Thursday, September 25, 2008

boom to bust

factoring in the proposed new bail out, the government will be spending around 1.3 trillion dollars to try to patch up the gaping economic wound. this money would be handed over to the bush administration with almost no regulatory oversight and that may be the most frightening specter on the horizon. what got us into this mess in the first place was the republican deregulation frenzy which allowed for one big speculative bacchanalia. if we hand over this money to bush with no oversight, we are giving him a blank check to do with it as he sees fit. we, as americans, want to believe in the inherent good of our political leaders but we can no longer afford that kind of blind belief. we are facing a financial melt down. i am not an economist and so i am attempting to negotiate my way through the financial landscape and it really is an alice in wonderland sort of place. most economists agree that the bail out is integral in order to stave off a great depression. there are a few dissenting voices, who say that this crash needs to happen in order to clear the markets. i'm not going to sit here and pretend to have all the answers but, having said that, i have some suggestions. if we are to go ahead with the bail out, there needs to be some oversight into how that money is spent. i do not trust this administration to act in the good of the country. if we are to bail out these financial institutions, then we need to strip their top executives of the so called golden parachutes, where they dance away into a very comfortable retirement, unscathed by the damage they have caused. a part of the bail out package must include a good by to the days of deregulation. it does not work. greed overtakes and wild speculation ensues. all goes well for a while and then all hell breaks loose. enough. put back in the regulations that were so prudently instituted after the great depression. the other problem that we face is the deficit and that is where the tax payers come in. we cannot continue to borrow money, never saving for a rainy day or old age. we are running a deficit of around 482 billion and that is on top of a 9.5 trillion national debt. the american people are going to have to suck it up and start paying off this debt or learn to speak chinese. it is either guns or butter but you can't have both. you cannot give tax cuts in times of war. that is how you run a deficit. the economy cannot grow when more and more of our budget is goes to pay the interest on the debt. either way, there are some hard times ahead. i believe we can turn this crisis around but not without sacrifices and that means no tax cuts.

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