Bailout A Bad Thing?
After thinking about this for awhile I can see the need for a bailout. I’m just not sure who should get it. The auto companies want one, wall street wants one, home owners want one. Heck, I think everyone wants a bail out. With that said, who should get one?
Looking back at the last great depression, the government grew to a huge size. It basically put programs in place to employ everyone that needed to be employed. There were government agency that paved roads, planted crops, made dam’s, and built anything they could. It was a huge bailout. Everyone got a piece of the action.
Looking at the modern bailout, I’m not sure people need to be employed by the government. Putting money into companies that create or hold jobs seems to be the right way to go. The automotive companies employee a ton of people. Their suppliers employee even more people. So if they fail, those folks go on the unemployment line. Nothing gets built or sold why those people are on unemployment. So does it make sense to give money to the auto companies. It is a definite maybe. If the money goes to creating and maintaining job’s in the United States. If the company takes the money and continues to build plants in Asia and closes them here, they should not get a dime. Possibly the government should just buy the auto companies and put them into receivership.
The wall street bailout continues to crack me up. What an utterly futile bailout. They want to free up credit they continue to say. What does that mean? The people who have good credit can continue to get it. People with bad credit will be less likely to get it. So how does it help anyone? I’ve said this before but it needs to be repeated. When did the stock market become a bank? It is a casino. If you put your money in your 401k and risk it. Then its gone. Now I know some companies contribute to your 401k via company stock. So if you had Ford or GM stock in your account, that could be bad.
I doubt wall street will go back to the same lending practices as before. With people in a worse financial situation, I don’t see the money going to them. Now the government makes a case that money will flow back into companies. What guarantee will there be that it will stay in the United States? None.
The oversight on all of these programs is a joke. In order to get any money each company should have to submit their business plan for congress and the public to review. If they don’t like it, don’t ask for money.
There is nothing in the latest round of bailouts that says anything about stopping foreclosures or helping the job market. Just that if the mortgage fails the government covers the debt. Oh yea. You can now get unemployment benefits longer. People want jobs, a home, and food. If money goes to some other purpose its wrong. I don’t particularly care if a CEO needs to fly coach instead of first class.