- The "Paulson Plan", or whatever you want to call it, is NOT a bailout plan.
- It IS legislation proposing a massive liquidity injection into the SYSTEM.
- The fat cats already GOT their ridiculously excessive compensation, they are not getting "bailed out", nor do "they" need to get bailed out. They are already rich.
- The plan is an "everything to gain, nothing to lose" plan. If housing prices continues to sink, the economy and the US$ will collapse COMPLETELY. With the "plan" (injection of liquidity), you at least have a shot of avoiding that outcome. Without it, you are almost assured a surreal ass kicking, i.e. massive unemployment, fuel and food inflation, credit deflation, political upheaval - really, really bad stuff.
- With all of that, even if the plan IS fully funded, it still might not work! The consequences of that outcome are almost unthinkable.
Friday, September 26, 2008
Democracy does not require competence
If you have been reading me for awhile, I hope you have a sense that I am a fairly apolitical, rabid Libertarian. I don't have a dog in the political hunt. I enjoy making fun of the Loonie Left and the Hypocritical Right as much as the next guy.
So I am going to lay out a couple of facts some of you will find hard to swallow:
The average American, and the average American politician voting on the plan on Capital Hill, has NO IDEA what the hell is going on - but, boy, do they have an opinion! (Not that I am always correct in my assessments, either. But if you are fighting a war, hire a General.) Hank Paulson might have been the BOSS at THE firm that demolished the credit market, but he is as competent as it GETS at this (nobody said he was perfect, noble, ethical, etc... just competent in the extreme). Obama or McCain? Not a clue. Not one. NAFC.
There are some unintended consequences, of course. One of these nasty consequences was pointed out to me by the Mad Scientist... Look for a $200 billion bailout, and this one REALLY will be a bailout, for Detroit. Now THAT will be about the dumbest thing we could possibly do, which means it will happen for sure. Can you imagine the Feds doing something intelligent, like using the $200 Billion to build electrified rail between the major cities on the East Coast? Again, NAFC.
Mentatt (at) yahoo (d0t) com
Posted by The Short Story Man at 1:51 PM