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instead of bailing out....
we all have our opinions regarding what caused the crappy condition of the economy;its been covered ad nauseum. without going into blaming for the current condition, what are some viable options, according to you, to fix the current state of our nation's and world's economy?
this is a serious question. there is a ton of talk about what we shouldn't do. what should we do instead?
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Mercedes-benz w113
Last edited by precisionlabradors; 04-26-2011 at 03:22 PM.
This will be far to simplistic but at least in my head I have these for examples. I would like to buy a new car and I assume GM would like to sell me one. Rather than just giving GM the money and let them blow it in a few months and still not sell any cars. Why not give me a rebate large enough that I would go buy a car. The the salesman and people at the dealer make money as well as the finance people and maybe even GM who used to be a viable company. Example 2 Instead of giving banks money who are now doing squat to lend money or worse deny companies access to their line of credit so the can make payroll and pay bills and remain in business. Or home owners who have lost their jobs because of the bank crisis that give or at least help the home owner keep the house and repay the bank the money.
"Communism only works in Heaven, where they don't need it, and in Hell, where they already have it" Ronald Reagan
Great question!Originally Posted by precisionlabradors
First, we should know that throwing money at any problem is not the way to fix it. It will only prolong the problem and make it even bigger.
What we need to do is;
1) Let the chips fall where they may. If I have my retirement money in bad investments, then shame on me, I pay the consequences. A lot of innocent by-standers will get hurt but, not as badly as they will get hurt in the near future in our government doesn't address real issues with real solutions. Throwing money at the problem is not a real solution. If our Auto industry is inept, then let them fail. Same for banks, financial institutions, airlines etc. By doing so, only those with good business models will survive and those without good products will fail. Same for homeowners that bought more house than they could afford. We need to return to a free market economy.
2) We need to fire everyone on Capitol Hill and start over with non-career politicians. Then elect Senators and Congressmen who don't want or need to make a living off of productive Americans. Strict term limits of 4 to 6 years is a must!
3) Secure our interest. That means securing our borders because the illegal problem is the biggest problem facing many major cities and states. Lets take care of our own first! Securing our interest also means having the best military with the best equipment we can supply them with. A strong military not only helps secure peace but also allows us to implement "good" around the world. This 900 billion bailout will come largely at our military's expense.
4) Put a stop to the entitlement mentallity that has taken this county over. We were strongest when we knew we had to do it on our own. Entitlements only makes us weaker as individuals and as a country.
I would say this is a good start.
Last edited by Franco; 01-29-2009 at 02:28 PM.
Where do we go without great leaders for the defense of our liberties? Who will defend our right to live our lives _as we chose_ without others taking that from us? The answer is, as it should be, no one. We are the defense of our rights and should always remember that. Libertarian blogger
First I think you leave it alone and let it sort itself out. Yes some businesses will fail and people will struggle but thats the way it goes.
Second, don't ever believe that those that got us in could ever get us out by spending OUR money.
Third, if you want to help people then find a way to keep gas at about $1.50/gal. After a short time people will become more comfortable with that extra money in their pocket. They will travel, buy goods and start enjoying life again.
Some people dream of success, while others wake up and work hard for it.
"Five in the hole is better then 250 circling overhead." - Jase Robertson
$1.50 gas is not feasable. That is until we have an alternative source of energy. Oil companies, refieneries and gas retailers can't make a slim profit when oil drops below $50. a barrel. That's why there are so many layoffs now across the country in the oil field. $2.00 a gallon would be a win-win situation.
Exxon's profits have little to do $50. per barrel and more to do with the speculators driving the prices to above $70 per barrel. Remember, it wasn't long ago the the speculators drove the price to $145. per barrel!
Last edited by Franco; 01-29-2009 at 12:32 PM.
Where do we go without great leaders for the defense of our liberties? Who will defend our right to live our lives _as we chose_ without others taking that from us? The answer is, as it should be, no one. We are the defense of our rights and should always remember that. Libertarian blogger
Cut the capital gains tax for a year or two.
Nancy P
"We give dogs time we can spare, space we can spare and love we can spare. And in return, dogs give us their all. It's the best deal man has ever made." M.Facklam
If $2 is the magic number I could sure live with that. For me, during duck season alone that price saves me nearly $100 per week just in truck and boat fuel. That money won't sit in my wallet forever it will end up somewhere eventually.
Some people dream of success, while others wake up and work hard for it.
"Five in the hole is better then 250 circling overhead." - Jase Robertson
The answer depends on how severe you believe the problems are. If this is a normal downturn, there is no reason to do much at all. Things will work out in time. If you believe that problems are deeper and reflect a collapse of our credit driven economy, doing nothing will probably drive us into a full-fledged depression. In that case, there are no answers that are very good. It took a world war to bring us out of the depression in the 30's.
I believe that there are two fundamental problems with our current economy.
First, for about 20 years the growth in our economy has been financed primarily through debt -- governmental and personal -- rather than through current income. Effectively, we have been financing current consumption by liquidating assets that took decades to accumulate and by giving pledges against future revenues.
Second, we have become addicted, through the stock market, to a rate of profit growth that is many times greater than the rate of real growth in the economy. That is the economic equivalent of a perpetual motion machine and cannot be maintained.
Unfortunately, our deficit financing caught up to us. Two thirds of our economic activity is driven by consumer spending financed by debt that was based largely on home equity. That credit has disappeared and it is not coming back.
There is no long term way to return the economy to the level that was being financed by artificial debt stimulants since the stimulants are unsustainable. The process of adjusting to a life where we live within our means as individuals and as a society will involve some fairly severe adjustments.
A stimulus program can help. However, whatever is done in the stimulus program must be structured so that it promotes real future growth without incurring future recurring costs or losses of revenue. A short term capital project that produces current jobs and generates economic benefits in the long term can help. Spending money to increase an entitlement program or to institute a new permanent tax cut would be bad investments because they create recurring costs, adding to both current and future deficits. I also believe that efforts to stimulate a return past policies of easy credit will fail because the reality is that fewer and fewer people are actually credit worthy.
In conjunction with a stimulus program, we will inevitably continue the policies of the last several years to "stiff" investors in our debt. We will continue to see our currency devalued. Those owning our national debt -- primarily China and middle eastern countries -- will be repaid in discounted dollars. Their growth will slow and they will be less willing to give us future credit. The cost of imported goods will go up while the cost of goods that we export will go down with resulting increases in export activity.
In addition, investors in our financial services industry will end up taking a bath as billions in consumer debt has to be written off. The only reason I can see for "bailing out" financial institutions would be if, at the same time, they write off non-recoverable debts with negotiated settlements on bad loans. This is an area with lots of risks -- including moral hazard risks -- but may be needed to allow a future recovery.
It is alot worse than what we've been told. Maybe we've been kept in the dark to avoid a panic. I was meeting with a bank president Tuesday morning and we were having this conversation. It started because his bank is one of the few that won't accept the TARP bailout as they don't need it. He was showing me on FDIC.gov the banks in trouble that haven't made the news yet(the general public has access to FDIC.gov). I'll throw out a bank getting ready to go bellyup that hasn't made the news yet, Regions Bank. They are a large bank serving the southeast with many branches. They are just one of many in trouble and I would suggest everyone look to see the financial health of their own bank. One clue if your bank is in trouble is if the accepted TARP money. Not that accepting it means they will go out of business but, they are hurting. My point is that this financial mess is beyond repair. It's been going on since the mid 80's and it has caught up with us. My question is; Is it better to take it on now or throw money at it and prolong the inevitable?
Last edited by Franco; 01-29-2009 at 03:19 PM.
Where do we go without great leaders for the defense of our liberties? Who will defend our right to live our lives _as we chose_ without others taking that from us? The answer is, as it should be, no one. We are the defense of our rights and should always remember that. Libertarian blogger
I agree with you on the severity of the problem. I think we are going to "take it on now" whether we want to or not. However, massive job losses, while they might help a individual company, are going to make the overall economic problems worse.
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