As the Bush Administration prepares for the largest and unprecedented bailout of the banking system in History, the major economic players are no longer pushing the idea of laziez-faire Capitalism. This is because it doesn’t work.
Much like the collapse of Authoritarian Communism, the U.S. has proven that letting the market make up it’s own rules is as idiotic as trying to control every aspect of the market as well. While we gloated and celebrated the collapse of the U.S.S.R., we dropped our guard and rejoiced over our economic superiority. Regan’s philosophy of trickle-down economics became heralded as the end all solution and Bush, Clinton and Bush II began forcing this system on anyone they could. Banks and investors alike became riskier and riskier making more and more money with greedier and riskier methods.
It really was two-faced, because there is no such thing as unbridled Capitalism. Adam Smith’s Capitalist Manifesto, “The Wealth of Nations†is vastly outdated as the U.S. Government pushes and pulls the invisible hand with interest rates, controls monetary values, negotiates trade arrangements and uses the Departments of Agriculture and Commerce to manipulate supply and demand. In addition, many businesses are bailed out (ie: auto, aerospace, banking) many are subsidized (ie: farming, defense, dairy) and the largest employer in the United States is the Federal Government.
In other words, there is no invisible hand of the market. Free Market Capitalism doesn’t exist. It is the greatest myth in economics. The only thing deregulation accomplishes is allowing the CEO’s and greedy rich folk at the top to write their own rules, which is like playing basketball or football without a referee.
The recent damn-near collapse of the banking system proves that deregulation does not work.
People like me have been saying this for well over a decade. We have cited that income disparity is no good for markets, that trickle-down economics is a lie, it only makes the rich, richer, that sooner or later the whole damn thing will collapse with out help from the public sector. We noted that war super-heats economies, not expand them, that Iraq and Afghanistan would have little impact and that deregulation provides no investment in the nation’s people or infrastructure, setting the tables for another massive depression.
I hate to say I told you so and I really don’t need to, Europe is doing it for me. They are commiserating in the failures of unbridled Capitalism. Their regulated system has shielded them from the large scale credit catastrophe we are witnessing in the U.S. They better not commiserate too much, as the great potential for a depression would cause Europe great harm to their tourism sectors, their aerospace industry (ie:Airbus) their auto industry (ie:Diamler) and their commodities and stock markets.
The chance here for a massive collapse is not only possible, it now seems probable. All our hope now rests on the brilliant minds of Paulson, Bernanke and Bush. Uh Oh! These are the guys who thought Capitalism could fly blind, that markets can fix themselves, that the rich getting richer somehow translates into greater purchasing at the consumer level. I am not confident in the largest bail-out in history. I am hopeful it will save us from ruin, however it doesn’t help the middle-class enough and will only serve the rich boys at the top.
Besides it contradicts everything these guys stand for. It’s Socialism, pure and simple, just not very well thought out Socialism. Leave it to the fat, rich Republicans to finally contradict their last remaining ideal. They are now completely morally bankrupt and have shown their true colors to the fullest: all that matters to the Good ‘ol Boy network, is the Good ‘ol Boy Network. They are seeking to make the American Tax Payer pay for saving the rich in America and abroad from poverty.
Why must we always bare the rich on our backs? Why must we sacrifice everything to save the rich from ruin?
I don’t trust Republicans to create a Socialist system. It is likely to end up becoming some kind of aristocratic regime that takes the people’s money and spends on the wealthy. Haven’t we had enough of that already? With the subsidized defense spending, companies like Halliburton made a killing on the taxpayer’s dime and turned around and moved to Dubai to escape potential war crimes charges.
Unfortunately something has to be done. So let’s hope the Democrats can beat the living hell out of the Bush Regime’s potentially last great decision. Bush has done irreparable harm to this great nation of ours, and I trust the bastard as far as I can through him.
The failure to hold the economy up may result in utter collapse. Much like the Great Depression, all the indicators are there: Banking crisis, limits of capitalist expansion, large debt, incompetent leadership (namely Bush), unbridled Capitalism getting itself into trouble, over-obsession with the stock market, large scale foreign investment, deregulation’s failings, monetary value problems and more. All that’s missing is a stock market crash to make the failing economy abundantly clear to investors.
Of course, this is not 1929, it is 2008 and anything can happen. The economy is infinitely more complex than 1929. The stock market volume is 1000 times greater and many of the FDR era regulations still exist and can protect us from the Republican attempts to destroy them. We may weather this storm with little damage, or it could scar us significantly.
Maybe we will even learn our lesson this time:
1.) Republicans have nothing to offer anyone with an income less than $300,000 a year and are utterly incompetent on all things economic. If you want to live like a Republican, you have to vote Democrat.
2.) Deregulation does not work, it has come up a cropper.
3.) Productivity means nothing without higher wages.
4.) It is the Middle Class that matters the most. Higher wages means better spending.
5.) Free Market Capitalism doesn’t work.
6.) A high degree of Socialism is healthy for the markets. It regulates industry like a referee does a sporting event.
7.) Spending the people’s money in bailouts is a poor investment. We are better off spending the money on better roads, better rail, better schools and better jobs.
8.) Wars do not motivate the modern economy.
9.) Trickle-Down Economics doesn’t work.
10.) We know less about economics than we think.
We are basically at the mercy of the Republican machine, let us keep our fingers crossed they haven’t ran our great nation into the ground.
