Sunday, September 21, 2008

The Great Swindle

The shock is beginning to wear off, which is bad news for the Shock Doctrine practitioners. These guys put it well:

Any member of Congress who looks at the plan to give [Treasury Secretary]Hank [Paulson] unchecked power to transfer $700 billion from the Treasury to his friends' companies and has any reaction other than "You've got to be fucking kidding me" does not deserve to hold office.

This loathsome bailout plan is a slap in the face to anyone who believes in either free-market principles or social justice.
Right now a corrupt and spent corporate class is on the brink of getting a corrupt and spent governing class to perpetuate its privilege by almost dumbfoundingly transparent means. Anyone with a soul needs to oppose them.
Jim Henley.

Update: 3:55 pm, Sept 21 -
There’s no institutional mechanism; there’s no logic to this bailout that could not apply to a future one. It not only culminates the previous era of Moral Hazard, it inaugurates the next one. It guarantees more of the same behavior that led to the current crisis.
More Jim Henley.

If millions of people take mortgages that they can't afford, and the ensuing mess threatens the stability of the financial system, the government can't bail them out --- some of them may have been ill-advised or rushed into bad deals by shady financiers, but it would destroy market incentives, and they just have to suffer.

If major financial institutions buy those mortgages, and the ensuing mess threatens the stability of the financial system, the government must bail them out --- they're getting off easier than they deserve, but the alternative is too horrible to contemplate.
Charles Dodgson.

[I]f this really happens, forget universal health insurance, aid to education, and middle class tax cuts as promised by Obama. The Republicans will have stolen the bank on the way out the door.
Jan in San Fran.



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