11.14.08

Race towards the bottom

Posted in Society at 13:55 by RjZ

I don’t think we should be surprised at all when the government comes up with a 700 billion dollar sack of our money and suddenly everybody shows up with a hand outstretched to get a piece of it. Big investment banks, little investment banks, credit card companies, car manufacturers and energy providers all want a piece of the action. Lobbyists must be busier than bees in a spring meadow.

OK, I get it. If we don’t help out all the banks who made bad and/or predatory loans then many more houses will go into foreclosure and that will seriously damage our economy. I understand, if we don’t help out our neighbors who bought more house than they can afford, and a new car and boat to boot, then there will be foreclosures and the value of my house will decrease!

Anybody who didn’t make one of these poor decisions is faced with Morton’s fork. We either reward poor judgment and pay for it with our taxes, or we suffer the consequences of not doing so and pay for it with perhaps years of recession.

I’ve already complained about that though. The point I want to make here is familiar to anyone who’s sat through the 1168 pages of Atlas Shrugged. As soon as the government offers help, the race towards the bottom begins where company leaders and upstanding citizens alike scramble shoulder to shoulder on their knees begging for money. Imagine the overwhelming power it must imbue Treasury Secretary Henry Paulson with, to nearly single handedly decide who will receive the taxpayer’s money and who won’t.

Perhaps the best solution would be to bite the bullet and suffer the downturn while the world economy corrects itself from markets escalated to fantasy territories. It’s often said that the poor suffer the most from downturns and this will be a world-wide crisis so we’re talking about poor nations along with poor citizens. However, if were to resist socializing losses, it might give those poor nations a bit of a boost as they catch up to the rich nations suddenly taken down a peg by their own lack of judgment. Wouldn’t that be a truly social thing to do? Just a thought. What do you think?

4 Comments »

  1. Pat said,

    November 18, 2008 at 21:41

    I wish the ghost of Ayn Rand could comment on this. Consider some personal details about Hank Paulson. An Eagle Scout, much admired, was on the Nature Conservancy board for a number of years. An avid nature lover, he has pledged his >$700M fortune to environmental causes after his death. When he became Treasury Secretary a major goal of his was to address the growing gap between rich and poor. I don’t think anybody could question his altruism or good intentions, and yet the only thing more feckless than his $700B bailout plan is his “selling” of said plan–he inspires less confidence than W himself. Less good intentions, more competence, please.

  2. RjZ said,

    November 18, 2008 at 23:40

    I didn’t mean to pick on Mr. Paulson, per se, but your comments sure are in keeping with my Ayn Rand reference. She would likely not have been surprised to hear that his motivations were altruistic, a curse word to the the inventor of Objectivism. Thanks for taking the time to comment!

  3. Nomad said,

    November 26, 2008 at 12:48

    Sigh. I’ve had a “Who is John Galt?” bumper sticker on my car since W was re-elected. I was hoping that, now that the “Obama/Biden” sticker next to it translates to “I was right! I told you so!” I’d be able to find something more cheerful (”Visualize Whirled Peas,” perhaps?) to replace my cryptically snarky John Galt sticker. Then I learned more about the bailout. It looks like John will be there for the life of my car. Sigh.

  4. RjZ said,

    November 26, 2008 at 13:05

    Hey, I’ve got the very same sticker. Now where ever did I get that….?

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