If unregulated free-market capitalism is so wonderful, why is it necessary for the federal government to rescue "Wall Street" from so many bankruptcies and failures? For example, Bear Stearns, AIG, Fannie and Freddie.
The Republican Party mantras of "get the government out of the way" and "keep interest rates low" are clearly invalid and have gotten us into a lot of trouble.
Allen Spangberg, Cary
For years, I bought into this idea of "let the free market rule." I realize that if these companies are not bailed out, then millions of people will lose money. But, isn't that what the free market is all about? Why haven't the millions of Americans who have lost their houses been bailed out? Yep, let the billionaires be billionaires. Let's save all of George W. Bush and John McCain's friends so they don't have to suffer.On another note
I am still a fan of supply-side economics. I heard someone the other day, way off base, say the supply-side economic policies of University of Chicago and Milton Friedman are not working. This idiot clearly did not read Jude Wanniski's book The Way the World Works. If he had, he would have known that it was Jude Wanniski that coined the term supply-side economics, and that Milton Friedman comes out of the monetarist demand-side school of thought. Uncle Miltie is still a brilliant man so I won't dis him. Rest assured, this type of government involvement today would make him sick. Supply-side economincs basically says that tax rates should be set at a level that achieves the maximum possible revenue, theyby providing incentive to those with high incomes and the means of capital most likely to spur growth. It doesn't say anything about bailing out banks and oil companies. In fact, if those companies are acting irresponsibly, a true supply-side economist would be in favor of punishing those companies. Once again, providing incentive to do the right thing. One other thing that supply-siders are in favor of is a gold standard (aka The Bretton Woods system), which was, of course, abandoned by a Republican Richard Nixon. The gold standard would allow us to tie our currency to something finite versus other currencies that fluctuate. Anyways, enough about that. I encourage everyone to read the book. I just want to make clear that supply-side economics is not laissez-faire capitalism, nor is it trickle-down economics.
3 comments:
Marc,
This economic talk is way over my head. I say, save the innocent investor (401Ks, etc.)and throw the greedy bastards to the wolves (they should be given a small pension [say $30,000/yr] and forced to subsidize their transgressions with their accumulated wealth). It's obvious, however, that some government oversight is necessary. It always appears to be the case that the advocates of small government change their tune when it comes to their own issues (like same sex marriage, farm subsidies, or bailing out abusive corporations).
So AIG is basically privatizing the profits and socializing the losses. Sweet deal.
I know. It's bull shit.
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