The funny think about markets is that they work only when allowed to. The crappy thing about politics is politicians rarely let markets work. President Reagan put it best when he said:
Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.
The government is like a fat guy at a morning meeting sitting at the end of the conference table near the box of donuts and the free-market is the box of donuts. He can’t control himself, he has to keep reaching into the box. Politicians can’t help but meddle in the market in an idiotic attempt to spare us from its cyclical nature. But their efforts end up making things much worse in the future.
We didn’t get to this point from too much deregulation, as many in the media and on the left (as if there’s a difference) would have you believe, we got here because of regulation, threats of more regulation if bad loans weren’t made and threats of more government intervention through civil action.
Also to blame are the people who were specifically exempted from guilt in last night’s VP debate, the people that took the loans. “Predatory lenders” gives the impression of some sort of land-shark roaming the countryside looking for dupes to give money to, but these people have offices. Just because someone got a flier in the mail promising them loans doesn’t mean the idiot who thumbed through the Val-Pac had to take one. Joe Biden said last night that he and Barack OBama want to lower the principle for people who bought more house than they could afford. Don’t you feel like an idiot for having lived within your means these last few years, especially since you’re going to have to pay someone else’s mortgage now.
Back to the bailout. The need to do something is common in politics. Just watch any politician at a townhall meeting. Someone will stand up and tell their sad tale of woe, lost their job, no education, can’t afford this, that or the other thing and they want to know what the government is going to do for them. Never will you see an elected official say, “Nothing, you’ll have to help yourself.” That’s what the Constitution demands, but it’s looked upon simply as a piece of animal skin with quaint scribbles from old dead, white guys on it now. Its bastardization led us not only to this crisis but to every “crisis” in the last 100 years. It was written to limit the power of the government, on that there is no debate, but has been reinterpreted to allow whatever the whimsy of the moment is, especially meddling in the market.
So we find ourselves picking up the $700 billion check on meal we were force-fed, and while we’re getting screwed, it’s not the type you might actively seek. Wall Street wants our money, but they want our money because the sun rose, everyone wants money. But this bailout is not needed, mostly because no one knows what will happen next. As an anchor on CNBC put it the other day:
Let’s not be careful, let’s ride this out, not kick the can down the road for someone else to deal with. Let’s not make it worse. Right now a small portion of taxpayers are caught up in this, don’t involve everyone.
Anyone who votes for this bailout is a douchebag of epic proportion. All this will do is cloud any investigation into how we got here, if one is even launched. Right now there are millions of documents sitting in Fannie and Freddie’s offices that could be destroyed legally because they are not under subpoena. The longer it takes to launch an investigation into the largest scam in the history of the Earth the fewer of those documents will survive.
For voting for a bailout rather than to launch an investigation, every single Member of Congress who votes in favor of the Frank-Dodd-Bush-Bernake plan is our Douchebag of the Week.
PS – A funny thing happened on the way to the bailout…a carbon tax provision found its way into the bill.