mm503: The $700 Billion Fairy Tale

September 25, 2008
© Penguinn | Dreamstime.com

© Penguinn | Dreamstime.com

Don’t have the energy for a full fledged rant, but several stories and commentaries crossed the screen today, and made it clear that, in an administration that never stops scamming us, they’ve totally topped themselves.

The Yiddish term is Chutzpah, whose classic definition has a young man, caught with bloody hands after murdering his parents, asking the court for mercy, as he’s an orphan.

We begin with that stalwart bastion of progressive thought, Steve Chapman of the Chicago Tribune. Stalwart, yes, bastion, yes, progressive? Judge for yourself.

chitrib

The case against a federal bailout

Steve Chapman | September 25, 2008

The late comedian Jack Benny made a career of claiming to be a cheapskate. In one joke, a robber accosted him and said: “Your money or your life.” Getting no response, the thug repeated his demand. Benny replied, “I’m thinking about it!”

That’s the sort of dilemma posed by Treasury Secretary Henry Paulson and Federal Reserve chief Ben Bernanke in their proposed rescue of financial institutions. They predict dire consequences if they don’t get their way. But the consequences of letting them have their way are so awful that the alternative doesn’t look so bad.

What they prescribe is for the federal government to buy $700 billion worth of lousy assets from banks and other lenders, exposing taxpayers to a potentially crushing liability. This plan would nationalize the money-losing part of the financial sector, to the benefit of capitalists who have made spectacularly bad decisions—fostering more bad decisions in the future.

It would add to the liabilities of a government that is already living way beyond its means. It would give unprecedented power to a couple of officials who have proved highly fallible in trying to avert this alleged crisis. And it poses the risk of abuse and corruption because the government has no way to gauge the value of what it will buy….

Paulson and Bernanke say, and probably believe, that their program is for the good of us all. But remember what Thoreau thought of their 19th Century counterparts. “If I knew for a certainty that a man was coming to my house with the conscious design of doing me good,” he wrote, “I should run for my life.”

The case against a federal bailout — chicagotribune.com

Read a local media observer today who thought that this was the year that Chapman’s paper, the Chicago Tribune might endorse a Democrat for president for the first time. Ever. In over 150 years.

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