Who amongst us even understands the bailout? I mean the actual A+B=C part. How money will be distributed, to whom, what it means short term, long term, how it translates to me, the individual consumer, mortgage holder and taxpayer? Show of hands. Is there a cricket in here?
I want to understand. In my gut, I’m outraged that it has come to this conclusion. So it would be nice to be able to articulate the reasons for my outrage. I guess I could just use the lingo W and congressional leaders have offered and keep saying the same key phrases over and over. Key phrases like “predatory lending”; “golden parachutes”; “the end result of de-regulation”; “collapse of the markets”; “dire consequences”; etc. But I don’t think I’d be any more convincing of my understanding then they are.
So it has to be done, fine. No point discussing it I guess. Little ol’ Amy in Ohio sure isn’t gonna make a difference in this discussion and since I’m vastly under-qualified on financial topics such as this, I guess that makes sense.
But this wouldn’t be a post worth posting if I left it at that, so please indulge me while I make just a few observations:
1) WHY is this suddenly a crisis? There have been a massive amount of foreclosures over the last thirty-six months (that’s THREE YEARS, not THREE WEEKS). Why is it only when the millionaires are affected does it become a “historic crisis”. I’m sure the families that lost there homes pre-crisis would disagree.
2) For two years now, I’ve endured the talking heads from the right labeling my candidate a socialist, and me a socialist for supporting him. Why is it that it’s socialism when you want to take tax dollars to ensure children have access to health care, but it’s NOT socialism when you’re handing faulty corporations BILLIONS of taxpayer’s dollars because they didn’t do their jobs very well. In my company, when you perform below expected standards, guess what happens? You get to clean out your desk, you don’t get a 700 billion dollar bonus.
3) Why in the world is W and his camp of cronies sticking to the idea that the de-regulation put in place by people like Phil Gramm (who still has the ear of McCain on such things as the ECONOMY) isn’t a major part of this problem? And if the shotty regs that remain on the books had been enforced, this historic crisis might be a little less historic, a little less of a crisis.
Don’t get me wrong, people borrowed beyond their means, no doubt. But a company lent the money to them and in doing so likely did not adhere to the federal regulations put in place to protect both the corporation and the consumer from these doomsday scenarios. So the lack of enforcement is part of this perfect storm tri-fecta Georgie, start warming to the idea. Fiscal conservative indeed. What a joke.
If the reports are to be believed, this bailout is going to go forward, for better or for worse it appears there is no way out. The right and left come together and give away the farm. Our farm. Our children’s farm.
I just hope that the lessons this historic crisis offers us aren’t lost in all the check-writing. Speaking of check-writing, take a look at what your money could have bought and then make sure you vote in November.
CHANGE WE NEEDED FOUR YEARS AGO
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September 29, 2008 at 11:40 am
Insta-mom
My husband and I were talking about this on Thursday. I don’t totally understand the bailout either. I honestly feel like we could resurrect someone like Adam Smith and even he would look at it and say “What the heck is this?!” It truly saddens me that we live in a country where it is okay to bail out faulty financial conglomerates even when there is so much poverty, so little funding for health care and education, so much research to be done, so many families who are barely scraping through each month, so many families losing their homes–good families, like the people down my street who moved out yesterday because they lost their house. And yet, because I don’t understand this completely, it’s difficult to speak up. Thank you, Amy, for saying something for all of us.
September 29, 2008 at 1:20 pm
Maura
I don’t understand it much better, and certainly not enough to speak about it, but I find myself feeling resigned rather than angry. I’ve worked in enough companies where the quarterly earnings were all it was about that I can see how this all came to pass, and really it boils down to greed and wanting to make sure the stake the richest people in a company had in companies stayed valuable. Yet you don’t see them reaching out to the guy who has worked there for 10 years but will probably be the next one to go when they do their next RIF — “reduction in force” which is Silicon Valley-speak for layoff.
It’s maddening, really, but it has become such a part of corporate America that I don’t even know if the change we want will do everything that needs to be done.
September 29, 2008 at 5:56 pm
genuinechris johnson
Ah, the ‘de regulation’ that caused it. It’s honestly and actually the other way around. Regulations that permit some banks to suck at the fed’s teets and not others, that make business practices no longer necessary are to blame. The bigger and more powerful a government can get, the worse off everyone is.
It’s the power of the government that is the problem. Bush and his vile minions should not have the power to: federalize education, perscription drug benefits, create a PATRIOT ACT, etc. Should not. Not in the constitution, not anywhere. They did.
Havinh FNMA and FCLMC as lenders created an artificial situation where we had loony loans (NINJA) and made this stuff a serious problem.
September 29, 2008 at 11:30 pm
MissyK
Backin’ you up here, sister. Unfortunately, I do not have the expertise to either give you answers, or to speak out myself. Even my Rep., fiscally conservative husband is suggesting things like, “if people and corporations would take responsibility for their actions…” and “what exactly would the harm be in letting some of these corporations fold? That would open the market for the more responsible corporations, who made good decisions, to prosper.” I don’t understand much about economics, but I know this bailout smells bad and makes my stomach hurt. That seems a bad sign. Thanks for the informative posts, Amy.