Stiglitz: A Better Bailout

Monopoly Man is loving life right now.

Monopoly Man is loving life right now.

There is a great editorial on The Nation by Nobel Prize winning economist Joseph Stiglitz, professor from Columbia University.  This transcript from a recent Lou Dobbs show is crucial reading as well.

He basically has pointed out everything I wanted to say – but he is obviously much more qualified than I to discuss economics at any length, so I’m just going to suggest you read his column and learn.

I will put in my two cents though – the Emergency Economic Stabilization Act of 2008 is basically the worst open handed slap in the faces of working Americans.  Basically what it’s saying is that Mega Corporation can take continuous chances and risks on people they KNEW shouldn’t have been lent a thing (not just people like homeowners, but other failed businesses as well), and they can still basically wipe their hands clean of it….pass the debts onto us…..and still make a profit at the end of the day.

Think about this in totality.

This is absolutely nuts….and most people just shrug their shoulders like….”eh….I pay my mortgage” or “ small business is doing well….fuck it.”  This is seriously bad.  The one thing that holds businesses back, or anyone, is debt.  If you could suddenly not have any and keep trucking……

And our dumbasses are going to get pay for it, one way or another.  If you’re late on some car payments…they come and scoop up your Honda Accord, with the broken turn signal, while you’re sleeping.  But MegaBank, who loaned your broke, bad credit punk ass, the money (millions of you, in ALL shades of color, mind you) is going to just get off the hook for it ….AND will come out with a profit, so they can continue to lend more money.

…and we are literally going to allow ourselves to get dump trucked, instead of fighting for a plan that would be beneficial for everyone.  They should just get it over with, and put a fixed amount of inherited debt, staggered to each American’s income and have us pay it off.

Can’t get those mofos no ideas…

(I personally think, in an idealistic world, those megacorps and the market should just fail…they have these weird ideas that “they are too big to fail” but really we would’ve been better for it.  Why should we foot the bill because of obvious greed?  We really don’t even know exactly how the $700 billion would be used- the text doesn’t really lay this out – put THAT on your brain for a minute.  And note the wink wink relationship of our government and JPMorganChase – you know the history, you would know this is a scary thing.  And what about this plan explains the government’s culpability in all of this?)

I did read one idea in the Wikipedia article about MegaBailout ’08, that they should’ve thought about (but they wouldn’t have for obvious reasons):

Journalist Rosalind Resnick suggested allowing “consumers and businesses would be able to borrow at the fed funds rate at 2 percent, just like the big banks do. This means that every cash-strapped homeowner would be able to refinance his mortgage and cut his payments in half, saving thousands of homes from foreclosure. Consumers could also refinance their credit card balances, auto loans and other debt at interest rates they can afford.”  She says it “would cost U.S. taxpayers absolutely nothing.”

But you can’t have that can you?….where’s the win in that?

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