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Posted on 10/20/2008 2:10:39 PM PDT by BGHater
In the midst of highly unpopular bailouts of Wall Street, many justifications have been given about why Washington feels the need to act. Some claim that capitalism and the free market are to blame, but we have not had capitalism. If you compare our financial capital to our aggregate debt, this would be obvious. In the same way, we have not had a truly free market. The monetary manipulations of the Federal Reserve, a complex tax code, the many “oversight” agencies and their mountains of regulations show that we are far removed from a free market economy.
Another unsatisfying argument is that certain entities have to be bailed out because of their economic importance. Supposedly, some entities can be so big, so important, that no matter what they do, citizens must perpetually sustain them.
Even limited government has a basic duty to defend against force and fraud. Some argue that force is somehow permissible just because the entity engaging in it is "economically significant." But one could use this reasoning to prop up slavery. It could be deemed unfortunate but economically beneficial, and indeed these arguments have been used historically to deprive people of their liberty. But slavery should never be tolerated regardless of any economic benefit, just as systemic fraud should not be tolerated. Some banks on Wall Street should fail. Fannie and Freddie should fail. They are perpetrating fraud against the people. Yet, government insists on rewarding behavior which should instead be investigated, prosecuted, and punished.
There has been much evidence of fraud at Fannie and Freddie, but when one man, Franklin Raines, defrauded the organization out of millions of dollars through illegal accounting tricks, and ends up agreeing to pay back just a fraction, one could argue that it was well worth it to him. Fannie went on to only get more deeply involved in subprime mortgages after this investigation. Several organizations are suffering right now precisely because the free market is trying to work and punish mismanagement, if only the government would get out of the way and let it. Perhaps banks are not lending to each other because they know that complicated accounting standards, created in part to defend against confiscatory tax policy, enables false fiscal pictures to be presented, which erodes trust. But this is not a time for the government to step in with more burdensome and complicated regulations, or more foolish liquidity injections. This is a time for some banks to fail, and remaining banks to deal honestly and transparently once again. More regulations will only result in more lies.
Just as economies that turned away from slave labor had a transition period, our economy would transition as well, but in the end, if we turned to honest, sound money and a truly free market, we would end up with a more just society, founded on truthfulness and decency, not subject to the violence of force or the whims of fraudulent institutions. Unfortunately, it seems we are headed into a new era of slavery, however, where all taxpayers will be forced to render to the Fed and big banking interests the bulk of the fruits of their labor, possibly through higher taxes but definitely through the eroding force of inflation.
Words of wisdom from a giant among pygmies.
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Too bad he’s a “truther” surrender monkey.
His campaign wasn’t too big to fail.
Ron Paul ping!
Sometimes you have to give up a little freedom in order to be more free. The financial derivatives market is 51 trillion dollars (or at least it was, people don’t know how much its worth now).
To put things into scope, a country’s assets are usually 5 times GDP. The US makes 13 trillion a year in GDP. Its networth is around 65 trillion dollars.
Sometimes in the short-run, market adjustments can be extremely deadly. If credit markets had been allowed to fail, we would’ve probably gone through a major recession if not depression.
That doesn’t make it any less palatable to us true-blue conservatives and we should be hopping mad that this bailout came with no conditions to ever prevent this from happening again. We’re going to see a neutered form of subprime lending in the future with the democrats in control. Count on it.
I’m sure he does. I’m sure he believes all the Arab/Muslim/Islamic terrorist attacks on Judaism/Christianity all down through the centuries are the fault of America’s foreign policy.
I am so sick of Paul. He cares more about playing rock star with his little truther buddies than he does about his country.
If not, he would have endorsed McCain and set his manic supporters against the Marxist tyros with the narcissistic personality disorder.
How long are you going to keep repeating lies?
Paul is not now and never was a ‘truther’.
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Mathematically, one of two things (or both) must almost certainly be true:
Consider Boris' Bank in Pottsylvania (no banking rules there). Boris sells $100 two-year CDs at 41.4% interest; after two years, they're worth $200. Initially, people are skeptical about Boris' offer, so few people invest at first. After people see that Boris is making good on his CDs, increasing number of people invest. What they don't see is that Boris simply pockets any money that won't be needed to pay off claims within the next three months. As long as the number of depositors doubles every couple years, Boris will continue to make good on his CDs. When deposits stop accelerating, and the three-month reserve gets nearly exhausted, Boris goes to the government and asks for a 'loan' to keep him afloat. Should the government grant it? What would be the effect?
A non answer. About what we expect from RNC stooges.
They're just p!ssed that Paul called this one right, and called it during the Primary.
You phrased that correctly by using the word totalitarian.
It seems that The neocons are pretty much fascists, while the Democrats are more Marxists.
"Meet the new boss, same as the old boss"
All you Ron Paul haters, don't say he didn't warn you!
The truther accusation was debunked long ago. Give it a rest.
And whatever else you have to say, you can rely on this- he’s dead right about the economy, and he’s been dead right for decades.
Adjust your investment strategy accordingly.
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