While the mess unfolded, there were a couple of thoughts that popped up in my head. No, I don’t want to get into whose fault it was - I think that’s pretty much both sides at this time. Instead, there are a couple of things that are just worth considering.
How come the Feds are injecting $630 billion without any bill or congressional oversight? If they can do that anyways, why do we need a bill?
This whole thing smells like the story of the guy who cried wolf.
Politicians, and especially our current administration, have lied to the American public so often that we won’t believe them if they tell us there’s a grand emergency. After everything we’ve been through in the last few years, most Americans doubt their word there’s a need for this. To them, it’s just a ‘fat-cat’ bailout, so they’re overwhelmingly opposed. Or at least the vocal minority that calls their elected representatives is. (Looking at my 401k, I tend to disagree. But I’m not an economist, so what do I know…)
What’s up with the strange voting pattern?
One explanation that makes a lot of sense is that both parties played games - commit enough votes that it passes, but not enough that the public sees your party as the offending party. And at the last moment, a lot of Republicans got cold feet and backed out. Passing or not passing a bill like that based on political calculus is sickening, so I really hope I just have an overactive imagination.
Overall, I’m not certain blocking the bailout isn’t a good thing.
If you’re going to spend $700 billion, you might want to think things through. And as I understand it so far, the ‘compromise’ bill the Democrats achieved wasn’t much of a compromise.
There are plenty of armchair economists who have ‘better plans’. Can we instead get some people who really understand the issues? And that certainly excludes Paulson and Bernanke - it was their job to see this coming. Pretty much every financial predicition they made was wrong since they’re in office.
How much are $700 billion?
Beats me - but there’s a nice graphic showing a stack of $315 billion
So $700 billion is the price tag to save our economy? Where can we get that kind of money?
Well, if you look at the 400 richest Americans and they all gave half their money, we’d be set. And even the poorest of them would still have around $650 million left over - probably enough to survive. I’m not proposing this as a solution - but maybe we should think a bit about the fact that we have a society where 400 people can make or break our entire economy.
Oh, and if you want to learn more about this whole thing, here are good starting points:
Oh, and this is crossposted to my blog.