Stop the Bailouts!

Yes, it is true, the economy is not in good shape. However, I am appalled and disgusted by the public's apathy toward the piss poor government solution of bailing out and buying up the private sector. The American public seems to have given the democrat-controlled congress and President Obama a blank check. Well, not entirely blank. The check looks to be to the tune of one trillion dollars. A trillion dollars! That's not petty cash. That is $300 billion more than the $700 billion that was already pumped into the market under TARP, and puts us down a path of spiraling monetary value, and endless debt.

(Government solution)

We are entering an age pervaded by a horribly defeatist philosophy of bailouts. And, what bothers me more than anything else is that the market now looks to Washington for help, instead of innovating and reinventing. But this was Washington's plan all along. It has fostered a cycle of dependency for years. On one hand it promises government backing for the likes of Freddie and Fannie, encouraging predatory lending, and then turns around and reprimands those same companies for practices it encouraged. How can we expect a problem that was in large part instigated and then exacerbated by the government to be solved by the government? If we continue to allow congress, the treasury, and Obama to buy up toxic assets and attempt to recapitalize the market, all we are doing is pumping the market with more instability. We are allowing the government to reward failures and cover its own backside when it has already failed royally.

There should be more outrage. I understand many are hurting, many are out of a job, but that is no reason to allow the government to spend, spend, spend. The effects are disastrous. The best one can hope for with such a strategy is a temporary rebound or a slight boost in morale, but the long term effects are irremediable. In no uncertain terms, what I am saying is the long term costs far outweigh the supposed short term benefits. Here is what all of this spending means:

1. The federal government, already submerged in massive debt, will go deeper into the abyss than ever. They are printing money with nothing but good will to back it. The dollar's value will plummet in the next months and years because of all the bailouts.

2. The federal government, despite its almost limitless debt, will position itself to control a huge part of the private market. It will be the biggest government expansion since the New Deal. It will create a new toxic asset bank, and numerous other bureaucratic arms that will supposedly maintain transparency and accountability but in reality will only further their own interests and limit investment opportunities, and market flexibility.

3. With government's part ownership of certain companies (namely the now state-controlled banks), and its demand for high prices for its involvement and money (taking preferred shares, and forcing companies to spend money the way that it deems most appropriate), investors will not help re-capitalize the banking industry and the financial sector. The government will have taken all the attractive parts of investment. Without private interest and investment, these state-controlled entities will stagnate or decline, and will end up needing even more bailouts to stay functioning.

4. The burden of all these bailouts does not fall on some mystical government entity that has endless supplies of cash. It falls on the taxpayer. The cost of this crisis from TARP to the trillions in infusions by the FED, to the latest Obama-Pelosi stimulus has reached stratospheric proportions. When all is said and done the government may well have spend upwards of 6 trillion dollars. That is nearly half the US GDP. And it also means that taxpayer will be saddled with these massive financial commitments for years to come.

5. If it were not bad enough that our dollar will be worth next to nothing, we will be digging ourselves deeper into debt, and the government will in large part be taking over the private sector and no new investment will be coming our way, the stimulus package proposed will throw money at terribly wasteful items. Some notorious examples are the mob museum in Las Vegas and Pelosi's birth control stimulus. Those are only the more notable worthless projects. Others involve vineyards and train rides and amusement parks in Alabama. 

I implore you. I exhort you. Stand up against this wasteful stimulus. It will not bring us back. The New Deal didn't work, and neither will this. The only thing all this spending accomplishes is building an ever-growing, less competent Leviathan. The government will tighten its stranglehold on the private sector, and its centralizing power will eventually consume every aspect of our lives (You might think that I'm exaggerating, but I'm not). This is the soft despotism that Tocqueville warned about. Call your congressmen and senators. Tell them to stop the bailouts. Tell them to come up with real solutions. Perhaps instead of bailing out and buying up, we could compromise. Half of that trillion in tax cuts, and half in bailouts. Let's see which strategy works better and gets the economy moving. 

Here the numbers for all of the US Senators:

ALABAMA

Jeff Sessions (R) - 202-224-4124

Richard Shelby (R) - 202-224-5744

ALASKA (202-224-6665)

Lisa Murkowski (R)

Ted Stevens (R) - 202-224-3004

ARIZONA

John McCain (R) - 202-224-2235

Jon Kyl (R) - 202-224-4521

ARKANSAS

Blanche Lincoln (D) - 202-224-4843

Mark Pryor (D) - 202-224-2353

CALIFORNIA

Barbara Boxer (D) - 202-224-3553

Dianne Feinstein (D) - 202-224-2841

COLORADO

Wayne Allard (R) - 202-224-5941

Ken Salazar (D) - 202-224-5852

CONNECTICUT

Joseph Lieberman (I) - 202-224-4041

Christopher Dodd (D) - 202-224-2823

DELAWARE

Joseph Biden (D) - 202-224-4041*

Thomas Carper (D) - 202-224-2441

FLORIDA

Mel Martinez (R) - 202-224-3041

Bill Nelson (D) - 202-224-5274

GEORGIA

Saxby Chambliss (R) - 202-224-3521

Johnny Isakson (R) - 202-224-3643

HAWAII

Daniel Akaka (D) - 202-224-6361

Daniel Inouye (D) - 202-224-3934

IDAHO

Larry Craig (R) - 202-224-2752

Michael Crapo (R) - 202-224-6142

ILLINOIS

Richard Durbin (D) - 202-224-2152

Roland Burris

INDIANA

Evan Bayh (D) - 202-224-5623

Richard Lugar (R) - 202-224-4814

IOWA

Charles Grassley (R) - 202-224-3744

Tom Harkin (D) - 202-224-3254

KANSAS

Sam Brownback (R) - 202-224-6521

Pat Roberts (R) - 202-224-4774

KENTUCKY

Jim Bunning (R) - 202-224-4343

Mitch McConnell (R) - 202-224-2541

LOUISIANA

Mary Landrieu (D) - 202-224-5824

David Vitter (R) - 202-224-4623

MAINE

Susan Collins (R) - 202-224-2523

Olympia Snowe (R) - 202-224-5344

MARYLAND

Benjamin Cardin (D) - 202-224-4524

Barbara Mikulski (D) - 202-224-4654

MASSACHUSETTS 

Edward Kennedy (D) - 202-224-4543

John Kerry (D) - 202-224-2742

MICHIGAN

Carl Levin (D) - 202-224-6221

Debbie Stabenow (D) - 202-224-4822

MINNESOTA

Norm Coleman (R) - 202-224-5641*

Amy Klobuchar (D) - 202-224-3244

MISSISSIPPI

Thad Cochran (R) - 202-224-5054

Roger Wicker (R) - 202-224-6253

MISSOURI 

Kit Bond (R) - 202-224-5721

Claire McCaskill (D) - 202-224-6154

MONTANA

Max Baucus (D) - 202-224-2651

Jon Tester (D) - 202-224-2644

NEBRASKA

Chuck Hagel (R) - 202-224-4224

Ben Nelson (D) - 202-224-6551

NEVADA

Harry Reid (D) - 202-224-3542

John Ensign (R) - 202-224-6244

NEW HAMPSHIRE

Judd Gregg (R) - 202-224-3324

John Sununu (R) -202-224-2841*

NEW JERSEY

Robert Menendez (D) - 202-224-4744

Frank Lautenberg (D) - 202-224-3224

NEW MEXICO

Jeff Bingaman (D) - 202-224-5521

Pete Domenici (R) - 202-224-6621

NEW YORK

Kirsten Gillibrand (D)

Charles Schumer (D) - 202-224-6542

NORTH CAROLINA

Richard Burr (R) - 202-224-3154

Elizabeth Dole (R) - 202-224-6342*

NORTH DAKOTA

Kent Conrad (D) - 202-224-2043

Byron Dorgan (D) - 202-224-2551

OHIO

Sherrod Brown (D) - 202-224-2315

George Voinovich (R) - 202-224-3353

OKLAHOMA

Tom Coburn (R) - 202-224-5754

James Inhofe (R) - 202-224-4721

OREGON

Ron Wyden (D) - 202-224-5244

Gordon Smith (R) - 202-224-3753

PENNSYLVANIA

Robert Casey (D) - 202-224-6324

Arlen Specter (R) - 202-224-4254

RHODE ISLAND

Jack Reed (D) - 202-224-4642

Sheldon Whitehouse (D) - 202-224-2921

SOUTH CAROLINA

James DeMint (R) - 202-224-6121

Lindsey Graham (R) - 202-224-5972

SOUTH DAKOTA

Tim Johnson (D) - 202-224-5842

John Thune (R) - 202-224-2321

TENNESSEE

Lamar Alexander (R) - 202-224-4944

Bob Corker (R) - 202-224-3344

TEXAS

John Cornyn (R) - 202-224-2934

Kay Hutchison (R) - 202-224-5922

UTAH

Robert Bennett (R) - 202-224-5444

Orrin Hatch (R) - 202-224-5251

VERMONT

Frank Lautenberg (D) - 856-338-8922

Bernie Sanders (I) - 802-862-0697

VIRGINIA

John Warner (R) - 202-224-2023

James Webb (D) - 202-224-4024

WASHINGTON

Maria Cantwell (D) - 202-224-3441

Patty Murray (D) - 202-224-2621

WEST VIRGINIA 

Robert Byrd (D) - 202-224-3954

John Rockefeller (D) - 202-224-6472

WISCONSIN

Rusell Feingold (D) - 202-224-5323

Herb Kohl (D) - 202-224-5653

WYOMING

John Barrasso (R) - 202-224-6441

Michael Enzi (R) - 202-224-3424

*Some of these Senators are no longer in office. 

The Government Bails Me Out

Well, I'm sure you're all well aware that the government bailed out AIG with 85 billion dollars of worthless paper, then came back and made it $150 billion. Then, congress passed the $700 billion dollar TARP (Troubled Asset Relief Program) initiative to bail out almost any bank and lender with a good enough reason to stick its hand into Uncle Sam's pocket. Well, the government has just bailed out Citigroup with another $300 billion, and Obama has said he will pump in another $300 billion in another recovery plan when he takes office. That brings the tally (not including the other money appropriated directly by the treasury that didn't get as much press) to $1,450 billion. That's almost 1.5 trillion dollars. And, most people are saying that no end is in sight. When all is said and done the government of the US may have pumped in over 5 trillion dollars. 

But here's the kicker. The government has now decided to bail me out. I will get $70 billion. They say it's the largest bailout of a private citizen in our nation's history. 

The reason I deserve it is because if I don't get this bailout I will not be able to remain solvent. I personally backed over 40,000 mortgages in the US with my steely grin and chutzpah. But, in these uncertain times that's apparently just not good enough. Some who own my mortgages were going to default (Edna and George, Jay and Carla, Betty and Fred I'm referring to you in particular you pansies). 

In exchange for the money I've given the government a 30% stake in me. Good news? I still own myself. Mostly.

And you thought your money was worthless before this economic downturn. Ha. Quickly, start buying up gold coins! Or go on a quest like Super Mario, Sonic, or play Zelda.

Bailout=FAIL.

I got word just now that the bailout proposal has been rejected by congress. I am elated. Federal funds should stop going to bailout private firms. They failed. I did not cause their failure. Neither did millions of other Americans.

Congress is just trying to cover their own stupidity. Since 1992 democrats have been pushing mortgage lenders to make high risk loans to the poor. Well guess what?! In a pinch, they can't afford them, and many of them were paying next to nothing anyway. We, as Americans need to think more about living within our means. If I cannot afford something I should not be able to buy it. But the government barged in and said credit scores don't matter, incomes don't matter, everyone DESERVES a loan. Well, we can see what happened following that mentality.

I am not holding the financial industry and mortgage lenders blameless, but it was DC that caused this problem, not NYC. NYC just exacerbated it on the false pretense that the housing bubble would never burst. Many saw this coming for years. Prices don't always go up, and debts have to be paid.

It's true, regulation is needed. We can't allow anymore high-risk loans. But, we must allow private firms to bailout the market, not the government. And short selling is not the problem. The idea that stopping short selling will help the market is asinine. Just enforce the laws on the books that call for transparency.

The Banking Crisis

Just about everyone has made reference as of late to the financial crisis, so I'm going to put in my two cents. 

Initially, as with everything, people wanted to blame Bush and lenient regulations that were promoted by his administration and party.  Then people started to get it right and blamed the money managers and CEOs of AIG, Lehman's, Freddie and Fannie for overextending themselves into risk averse loan situations without consideration of the ramifications. Then people went back to blaming Washington, which is a generic cop out strategy, to not put the blame exactly where it lies. Many factors were involved. Yes, it involves many greedy bankers, yes it involves the FED, and yes, it could have been prevented. However, I am horrified by the solution.

The US first bails out Freddie and Fannie, then it lets Lehman Brother's go bankrupt. The next day they bail out AIG, and now they have devised a plan to loan 700 billion dollars to ad liquidity and save the entire financial industry in America and the world. What that amounts to is a free ride for these companies. It's like saying, "Well I know you were irresponsible for more than a decade and a half, causing millions of people to lose their money, but we'll bail you out anyway and you can live happily off your 7-8 figure pension or severance." But, this bail out is not just helping American companies. Paulson has included foreign companies who have a lot at stake here as well, because as he correctly claims "It is a global problem." However, that being said, it should be a global solution, not the American taxpayers bailing all these companies out. We are marching towards socialism. We will soon have a completely state run financial system. And, the best part about it is no one consulted the American people. I suppose they didn't have to, but it sure ads insult to injury. 

Who really should get the help from this crisis are all the people who put money into this failed system, not the system. The lenders screwed up royally and can't pay back their debts, so why should we the people who lost our money to them, bail them out? I know some will argue, "desperate times call for desperate measures," but I would have stopped at Freddie and Fannie. 

Oh, and on another note, the former CEO of Fannie works for Obama, gave a load of money and picked his VP.