"There is no Santa Claus folks"

I’ve taken Economics 101. That means I know next to nothing about economics. I do know that the “bailout” (perhaps the better term would have been “sell-out”) failed, and I cannot say that I am disappointed. Again, I am not an economist, and I have not totally grasped the reason(s) for this collapse. I do, however, understand that $700 billion of taxpayer money is an astronomical figure, and to hand it over to the very people who have helped create the mess in the first place does not compute. Even had I taken Economics 201 I still don’t think the bailout (in the form which was defeated) would have made any sense.

For my rabidly conservative friends, I’m talking about those who believed the bailout was the right thing to do just because the President was pushing it, please understand that 133 of 199 Republican representatives voted against the bill. This was not Democrats shooting down Republicans; this was Republicans versus Republicans. House Minority leader John Boehner (R-OH) may have endangered his already precarious leadership position by pushing for this legislation.

Would the bail-out been the corrective measure the economy neeeded? I’ll state it again: I am not an economist; however, an economist that I highly respect was not in favor of the bailout. Thomas Sowell, whose columns frequent my “Shared” list on this blog, in an interview with newsmax.com said that the $700 billion Wall Street bailout could have signaled “the end of the free market.” Click on the link and read the interview. I believe it is a sane analysis and commentary on this fiasco. Here are my favorite excerpts:

Sowell said economic losses are just as important to capitalism as profits, because losses help people learn to make better decisions. Bailout plans “don’t take into account that people learn from paying the price for their mistakes,” he said. A bailout would encourage an entitlement mentality in which people seek to earn profits while being protected from losses. People need to take individual responsibility for their decisions instead of looking for taxpayers to cover the losses, he says.

The interview ended with the quote that provided the title of this post.

“Go to the American people and tell them, ‘There is no Santa Claus folks. If you want to take risks you are going to pay for it,’” Sowell said, adding, “Compassion should extend to taxpayers as well as everybody else.”

Another person whom I admire and respect is Rep. Mike Pence (R-IN). He is from Indiana’s 6th District, which includes a portion of Dearorn county; my home county. Rep. Pence voted against the bill. He had this to say:

Economic freedom means the freedom to succeed and the freedom to fail. The decision to give the federal government the ability to nationalize almost every bad mortgage in America interrupts this basic truth of our free market economy. Republicans improved this bill but it remains the largest corporate bailout in American history, forever changes the relationship between government and the financial sector, and passes the cost along to the American people. I cannot support it.

I understand that something needs to be done, but I’m glad that this something wasn’t done.

(HT to Doses of Reality for the linked articles.)

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About Travis

I am married to Dianna, and we have three boys: Luke, Noah, and Ethan.
This entry was posted in Bail-out, DEMS, Economics, GOP, Politics, Ridiculous. Bookmark the permalink.

2 Responses to "There is no Santa Claus folks"

  1. Philip says:

    I’m pretty sure the “rabid” conservatives are with you on this one (like me). This bailout is atrocious. Hopefully, the House Republicans call put something better on the table for next time.It would also help for the Senate Republicans to grow some spines. We’ll see tomorrow . . .

  2. Travis says:

    Be assured, my friend, that was no reference to you. (Even though you are rabidly conservative!) From your many posts on the topic I knew where you stood on the bailout, and I agree with you. Recently, however, some very conservative friends of mine were making what I thought were mostly silly assertions about this quagmire, the cause of it and the remedy for it. Half of this country hates President Bush, but much of the other half thinks he is always right. As for me, while I’m glad that he and not Al Gore or John Kerry is President, I’ll be happy when his term is over.

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