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Obama Owns This Economy - Page 3

post #81 of 152
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Quote:
Originally Posted by john galt View Post

Understood. Only government has the resources to thwart the Apocalypse. As I wrote earlier, OK!

Look SDW, you're either an advocate for free market capitalism or you're not. You're either a rugged individualist or you're not. I don't have to ask which you are since you've already removed any uncertainty I may have had.



Though they were written over twenty years ago, I submit the above would be an apt description of AIG's collapse. May I assume you agree?

Here's more. It's from the same speech.



---

The above was written a long time ago. It is still relevant today. Given recent events it's only likely to become more relevant in the future.

You either agree with it you don't SDW. If not, you ought to turn in your Conservative card because you're not worthy of it.

To be clear: the current debacle was born way before AIG and the circumstances that led to its collapse. It was the predictable, inevitable, and direct result of government intervention in free markets. The path to prosperity is less intervention, not more. To (almost literally) paper over the systemic problems that still exist is no solution at all.

Enjoy your vacation from reality in Disneyland. Sounds like it began some time ago though.

...or am I just being an ass again?


You are not just being an ass, you're being a narcissistic ass. No one appointed you arbiter of the conservative movement. No one gave you the power to decide who is a conservative and who is not. No one bestowed upon you the ability to define conservatism one way, and dismiss anyone who has a view that varies even slightly.

This board is a place for discussion. It's not a place where you get to run around and be The Professor. You have stated your opinion that you don't agree with TARP and that you want government out of economy. You have further stated that government caused our current problems. Fine.

What you fail to understand, however, is that we are we are. Government intervention over the years may have lead us down this path, but we're still at the end of the path. The question with the 2008 crisis was whether the financial system could survive without immediate intervention. I do not believe it would have. By "not survive," I mean a situation far worse than the Great Depression. I'm not talking about a painful adjustment. I'm talking about full-blown civil unrest--the end of America and perhaps the world as we know it.

Now, we can debate government intervention and the role of government in general all day. You'll find we agree on most things. I, too, think government MUST shrink and get it tentacles out of the economy. But the time for that debate was not when we were facing collapse. We're not sitting in a classroom debating the pros and cons of government intervention and the history of free market systems. We came to a point in time where, in reality, a perfect storm hit. Your position was to stand on principle while Rome burnt to the ground. My position is that it was better to save the financial system and worry about the government involvement debate later---which is now.

I'd love to see you explain to the millions of homeless and starving people that we didn't act to save the system because we thought the government was getting too big and too involved. Sometimes principles cannot come first in crisis situations. It's not the way we'd like it to be, but it's the way the world is. I, for one, understand that. I do live in reality. As for you...you don't seem like you have any idea of what was happening to world financial system. While you were busy thinking your economic feces didn't stink, the rest of the world was burning.
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post #82 of 152
Quote:
Originally Posted by SDW2001 View Post

Sometimes principles cannot come first in crisis situations.



Crises are what tests one's principles SDW. They're of no use otherwise. Principles must "come first" in crisis situations. If you abandon your principles when they're needed most, then you never held them in the first place. They are useless.

Deep down I suspect you know this, yet you seem committed to justify a position that cannot be logically defended. Your shrill reaction to what I've written seems indicative of this unresolved conflict.

Quote:
Originally Posted by SDW2001 View Post

It's not the way we'd like it to be, but it's the way the world is.

Wow. The more you write SDW, the more you sound like one of Obama's senior advisors:

"We have to deal with the world as we find it" - David Axelrod, November 2010

My humble opinion of your alleged conservative stance remains unchanged.

The fact is you don't just live in the world SDW. You change it. Many effective leaders, most notably Steve Jobs, have said things similar to this. And, if you're a member of the President's cabinet, you're actually in a position to change the world by putting such thoughts and beliefs and principles into action. They're the ones who lead the world. Everyone else is a passenger.

Too bad that so many in government have chosen the latter position, while people like you give them a pass. So many opportunities - wasted. I suspect that, like you, they abandoned their principles when they were most needed.

In the case of the current Administration, it's more likely they never had them to begin with.

"If you make people think they're thinking, they'll love you; but if you really make them think, they'll hate you." - Don Marquis, US humorist (1878 - 1937)

Are you hating me yet SDW?
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post #83 of 152
Quote:
Originally Posted by SDW2001 View Post

You are not just being an ass, you're being a narcissistic ass. No one appointed you arbiter of the conservative movement. No one gave you the power to decide who is a conservative and who is not. No one bestowed upon you the ability to define conservatism one way, and dismiss anyone who has a view that varies even slightly.

This board is a place for discussion. It's not a place where you get to run around and be The Professor. You have stated your opinion that you don't agree with TARP and that you want government out of economy. You have further stated that government caused our current problems. Fine.

What you fail to understand, however, is that we are we are. Government intervention over the years may have lead us down this path, but we're still at the end of the path. The question with the 2008 crisis was whether the financial system could survive without immediate intervention. I do not believe it would have. By "not survive," I mean a situation far worse than the Great Depression. I'm not talking about a painful adjustment. I'm talking about full-blown civil unrest--the end of America and perhaps the world as we know it.

Now, we can debate government intervention and the role of government in general all day. You'll find we agree on most things. I, too, think government MUST shrink and get it tentacles out of the economy. But the time for that debate was not when we were facing collapse. We're not sitting in a classroom debating the pros and cons of government intervention and the history of free market systems. We came to a point in time where, in reality, a perfect storm hit. Your position was to stand on principle while Rome burnt to the ground. My position is that it was better to save the financial system and worry about the government involvement debate later---which is now.

I'd love to see you explain to the millions of homeless and starving people that we didn't act to save the system because we thought the government was getting too big and too involved. Sometimes principles cannot come first in crisis situations. It's not the way we'd like it to be, but it's the way the world is. I, for one, understand that. I do live in reality. As for you...you don't seem like you have any idea of what was happening to world financial system. While you were busy thinking your economic feces didn't stink, the rest of the world was burning.

He could care less about the poor or middle class I see from his writing.You are right I am a realist also not someone who exists in a fantasy world who loves Wall Street and large corporations and his plastic to boot.
post #84 of 152
Quote:
Originally Posted by marvfox View Post

He could care less about the poor or middle class I see from his writing.



I'm not sure to whom you're referring Marv, but if you think I'm defending investment banks then clearly you haven't read a word I've written. Congress and the President rescued AIG and the investment banks by raping the "poor and middle class," without a word of debate.

As if that were not unforgivable enough, they handed this untenable situation to the most underrepresented and disenfranchised class of society: generations yet unborn.

And as for "caring" I suggest that sentiment lies at the heart of the problem. What's needed is less "caring" and more thinking. Caring, the liberal's highest and most noble calling, accomplishes exactly nothing.
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post #85 of 152
Thread Starter 
Quote:
Originally Posted by john galt View Post



Crises are what tests one's principles SDW. They're of no use otherwise. Principles must "come first" in crisis situations. If you abandon your principles when they're needed most, then you never held them in the first place. They are useless.

It must be nice to look at the world as if you were standing in an ivory tower. In the real world, there are choices...sometimes none that are "good." In this case there was no good option, there just was what their was.

Quote:

Deep down I suspect you know this, yet you seem committed to justify a position that cannot be logically defended. Your shrill reaction to what I've written seems indicative of this unresolved conflict.

First..I post what I think. I don't need your pop psychology analysis. Secondly, what I know deep down is that all evidence points to that fact that the economy and financial system would have imploded without immediate action by an entity with the resources to do so. There is only one on Earth that has those resources...and that is the Federal Government.

Quote:



Wow. The more you write SDW, the more you sound like one of Obama's senior advisors:

"We have to deal with the world as we find it" - David Axelrod, November 2010

Do you mean to tell me that no conservative has uttered something like this?

Quote:

My humble opinion of your alleged conservative stance remains unchanged.

Frankly John, I don't give a shit what you think.

Quote:

The fact is you don't just live in the world SDW. You change it. Many effective leaders, most notably Steve Jobs, have said things similar to this. And, if you're a member of the President's cabinet, you're actually in a position to change the world by putting such thoughts and beliefs and principles into action. They're the ones who lead the world. Everyone else is a passenger.

Nothing but a platitude and a strawman wrapped into one. I've never claimed the world can't be changed.

Quote:

Too bad that so many in government have chosen the latter position, while people like you give them a pass. So many opportunities - wasted. I suspect that, like you, they abandoned their principles when they were most needed.

People like me? I really think you have no idea to whom you're speaking.

Quote:

In the case of the current Administration, it's more likely they never had them to begin with.

"If you make people think they're thinking, they'll love you; but if you really make them think, they'll hate you." - Don Marquis, US humorist (1878 - 1937)

Are you hating me yet SDW?

I don't hate you, I simply think you're being inflexible and pompous. You're also incapable of honest disagreement. You're shown this by attacking me conservative credentials, comparing me to an Obama advisor, and lecturing me on principles...all because we disagree on TARP. The fact of the matter is that you do not think TARP and and certain government actions were necessary, and I do. Never once have I stated I think all government regulation and intervention is bad. You, by contrast, seem to be suggesting exactly that. If that's what you think, then that's fine. But realize that your position is the extremist, absolutist one...not mine.
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post #86 of 152
Quote:
Originally Posted by SDW2001 View Post

But realize that your position is the extremist, absolutist one...not mine.

You say that like it's a bad thing.

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post #87 of 152
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Quote:
Originally Posted by MJ1970 View Post

You say that like it's a bad thing.

I do, because it is. Being principled is one thing. Being utterly inflexible and ideological to the point where one can no longer see reality and/or times where exceptions need to be made is another.

No one likes TARP. Even many of the banks that received direct capital injections didn't like it. But it was the "least bad" of the options. Think about those options for a second:

--Purchasing toxic assets (the original purpose of TARP) was too slow

--Truly nationalizing the banks was un-American and politically untenable.

--In the judgement of investment bankers, Treasury, the Fed, and international authorities and bankers, doing nothing would not only lead the collapse of the U.S. financial system, but perhaps the global financial system.

Now, I understand that--in the vernacular--you and a few others think the above was all complete bullshit. The implication is that TARP was a massive boondoggle intended to be nothing other than a massive transfer of wealth from taxpayer coffers to private investment banks. The issue I have with this is that there is no evidence whatsoever to support it.

Of course, your point (I think) is that we also don't know what would have happened without government intervention. That's a fine point. However, the attitude I've seen expressed here is that in the face of the crisis we faced, it was better to just go to bed and hope the sun came up in the morning. How is that logical?
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post #88 of 152
Quote:
Originally Posted by SDW2001 View Post

I do, because it is. Being principled is one thing. Being utterly inflexible and ideological to the point where one can no longer see reality and/or times where exceptions need to be made is another.




Quote:
Originally Posted by SDW2001 View Post

But it was the "least bad" of the options.

You say that like it is a fact.

The state is nothing more than a criminal gang writ large.

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post #89 of 152
Thread Starter 
Quote:
Originally Posted by MJ1970 View Post



So you're telling me one should stick to his ideology no matter what? I don't agree with that.

Quote:

You say that like it is a fact.

It's my opinion based on the facts I know. If there are facts presented showing TARP was unnecessary, or that it was all a boondoggle, my opinion will change. So far, no one here has presented any of these "new" facts. Not a one.
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post #90 of 152
Quote:
Originally Posted by SDW2001 View Post

So you're telling me one should stick to his ideology no matter what? I don't agree with that.

Of course I'm not saying that. But you haven't given a valid, compelling or convincing reason to depart from the principles that were outlined.


Quote:
Originally Posted by SDW2001 View Post

It's my opinion based on the facts I know.

Thank you.

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post #91 of 152
Quote:
Originally Posted by SDW2001 View Post

.. Secondly, what I know deep down is that all evidence points to that fact that the economy and financial system would have imploded without immediate action by an entity with the resources to do so. There is only one on Earth that has those resources...and that is the Federal Government.



You said. Armageddon and all that. Only government. O, please save us!

Clearly you believe "the government" has infinite resources, when in fact it has no resources, other than the power to tax and to borrow. Given that US debt is projected to reach 100% of GDP this year ought to enlighten you as to those limitations.


Quote:
Originally Posted by SDW2001 View Post

... However, the attitude I've seen expressed here is that in the face of the crisis we faced, it was better to just go to bed and hope the sun came up in the morning. How is that logical?

Now it's not logical to hope the sun will come up in the morning.

Quote:
Frankly John, I don't give a shit what you think.

OK!

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post #92 of 152
Thread Starter 
Quote:
Originally Posted by john galt View Post



You said. Armageddon and all that. Only government. O, please save us!

Clearly you believe "the government" has infinite resources, when in fact it has no resources, other than the power to tax and to borrow. Given that US debt is projected to reach 100% of GDP this year ought to enlighten you as to those limitations.

It's interesting...I've not seen many conservatives that insist on using strawmen like you. You tell me what I believe, then proceed to knock down those "beliefs." What I said...ALL I said...was that the government was the only entity on the planet that had the resources to provide the emergency funds necessary to avoid collapse. That is all. I'm not getting into purely academic arguments with you about from where the governments gets funding. I'm not going to list the differences in TARP as compared to the Porkulus-slush-fund bill. Both are nothing but obfuscation on your part.




Quote:
Now it's not logical to hope the sun will come up in the morning.



OK!


You know exactly what the expression means. Your "solution" to the 2008 crisis was to do nothing and hope the world didn't burn.
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post #93 of 152
Thread Starter 
Quote:
Originally Posted by MJ1970 View Post

Of course I'm not saying that. But you haven't given a valid, compelling or convincing reason to depart from the principles that were outlined.

OK, MJ. Lehman fails. Merrill is on the brink. Wachovia is on the brink. Credit markets are frozen. Healthy companies cannot fund their operations within a few days. The biggest financial insurer on the planet is about to declare Chapter 11. Are you really telling me your position is that the government shouldn't have intervened in some way? What would convince you...looting?

Quote:

Thank you.

I don't think I said anything that unusual, unless you know facts that I don't.
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post #94 of 152
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better. I therefore intend to oppose the effort to increase America’s debt limit.”

-- Senator Barack Obama on raising the debt ceiling, 2006

Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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post #95 of 152
Quote:
Originally Posted by SDW2001 View Post

Are you really telling me your position is that the government shouldn't have intervened in some way?

Yes, that's my position.

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post #96 of 152
Quote:
Originally Posted by MJ1970 View Post

Yes, that's my position.

Mine, too.

Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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post #97 of 152
A lot of these banks were trying to raise their own capitol when the government stepped in. Government money crowding out private money. Big surprise.
post #98 of 152
Thread Starter 
Quote:
Originally Posted by MJ1970 View Post

Yes, that's my position.

Quote:
Originally Posted by jazzguru View Post

Mine, too.

Humor me and please explain why you both take the position.


Quote:
Originally Posted by FloorJack View Post

A lot of these banks were trying to raise their own capitol when the government stepped in. Government money crowding out private money. Big surprise.


How was that going?
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post #99 of 152
Quote:
Originally Posted by SDW2001 View Post

Humor me and please explain why you both take the position.

I can only speak for myself. But my reasoning is simply that it is immoral for the government to take money from some to bail out others. It is wrong when it is "mortgage adjustment". It is wrong when it is GM or Chrysler. It is wrong when it is the banks and Wall Street. It is morally wrong.

Finally, on a practical level I don't agree with the Chicken Little predictions of armageddon.

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post #100 of 152
Quote:
Originally Posted by SDW2001 View Post

Humor me and please explain why you both take the position.

The state perpetuates itself by intervening in the free market, claiming to "fix" a perceived (or contrived) wrong. This meddling creates more problems than it supposedly fixes, which gives the state an excuse to intervene more while claiming to "fix" the problems it created in the first place.

No advocate of a free-market system claims it is perfect or that no problems will surface.

We claim the problems inherent to a free-market system are more manageable and not nearly as far-reaching or destructive as what we have now.

Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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post #101 of 152
Thread Starter 
Quote:
Originally Posted by MJ1970 View Post

I can only speak for myself. But my reasoning is simply that it is immoral for the government to take money from some to bail out others. It is wrong when it is "mortgage adjustment". It is wrong when it is GM or Chrysler. It is wrong when it is the banks and Wall Street. It is morally wrong.

Finally, on a practical level I don't agree with the Chicken Little predictions of armageddon.

Then why is it moral to give out welfare? Food stamps? Foreign aid? FHA loan programs? Any expenditure whatsoever?

As for "chicken little," you don't agree...but you also have no evidence whatsoever to counter the claims. These claims were made by some very serious people. We're not talking about Joe Blow here, we're talking about Republican and Democrat leaders, business leaders, banking leaders, the Treasury Secretary of the United States, and more. I already laid out what the sequence of events was, some of which had already started. Commercial paper was frozen. Consumer credit was grinding to a halt. These are facts. What evidence do you have that our way of life wouldn't have ended? I say again...this was already happening to a degree. G.E. reported to Paulson that it was about to run out of money to pay day to day bills. AIG was going to go under. People were having trouble getting car loans. Was this just going to fix itself?

Quote:
Originally Posted by jazzguru View Post

The state perpetuates itself by intervening in the free market, claiming to "fix" a perceived (or contrived) wrong. This meddling creates more problems than it supposedly fixes, which gives the state an excuse to intervene more while claiming to "fix" the problems it created in the first place.

No advocate of a free-market system claims it is perfect or that no problems will surface.

We claim the problems inherent to a free-market system are more manageable and not nearly as far-reaching or destructive as what we have now.

We're not talking about something that happens in the bubble of academia here, jazz. We're not talking about an actual or perceived "wrong." We're talking about the financial system of the United States (and likely the world) collapsing. No conservative/libertarian/free market-minded person wants more government involvement. We can absolutely discuss the government's role moving forward, what it should and should not be, etc. I'm all for that. But we were facing a crisis of epic proportions...one that had to be addressed. It was not the time to debate how much the government did or did not do to contribute to that problem. It was not the time to have a classroom debate on how involved the government should be in the economy. No, it was instead the fact that we faced not being able to buy homes, cars, consumer goods and within a few weeks...groceries. As I stated above, the response I've gotten so far on that is nothing short of "ahhh, heck...that wasn't going to happen, SDW! It would have been tough, but we'd be fine!" But every person in the know disputes the notion that we could go to bed and then everything would be fine when we woke up in the morning.
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post #102 of 152
Quote:
Originally Posted by SDW2001 View Post

Then why is it moral to give out welfare? Food stamps? Foreign aid? FHA loan programs? Any expenditure whatsoever?

I never said it was.


Quote:
Originally Posted by SDW2001 View Post

These claims were made by some very serious people.

OK. And you trust them and I don't.


Quote:
Originally Posted by SDW2001 View Post

I already laid out what the sequence of events was, some of which had already started. Commercial paper was frozen. Consumer credit was grinding to a halt. These are facts.

Perhaps. But the sequence beyond that is a speculation.


Quote:
Originally Posted by SDW2001 View Post

What evidence do you have that our way of life wouldn't have ended? I say again...this was already happening to a degree. G.E. reported to Paulson that it was about to run out of money to pay day to day bills. AIG was going to go under. People were having trouble getting car loans. Was this just going to fix itself?

I'm not saying there would not have been some serious and major adjustments to be made. There still are. All that's happened is they kicked the can down the road. They didn't solve the problem, they bandaged it...for a time.

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post #103 of 152
Thread Starter 
Quote:
Originally Posted by MJ1970 View Post

I never said it was.




OK. And you trust them and I don't.




Perhaps. But the sequence beyond that is a speculation.




I'm not saying there would not have been some serious and major adjustments to be made. There still are. All that's happened is they kicked the can down the road. They didn't solve the problem, they bandaged it...for a time.

I think it honestly goes beyond "serious and major adjustments." As you said a few weeks ago, I think we just disagree. The good news here is that since we're not jimmacian, we can do that and move on.
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post #104 of 152
Quote:
Originally Posted by SDW2001 View Post

As you said a few weeks ago, I think we just disagree. The good news here is that since we're not jimmacian, we can do that and move on.

Agreed.

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post #105 of 152
Quote:
Originally Posted by SDW2001 View Post

Then why is it moral to give out welfare? Food stamps? Foreign aid? FHA loan programs?

It is immoral for government to do any of these.

Quote:
We're not talking about something that happens in the bubble of academia here, jazz. We're not talking about an actual or perceived "wrong." We're talking about the financial system of the United States (and likely the world) collapsing. No conservative/libertarian/free market-minded person wants more government involvement. We can absolutely discuss the government's role moving forward, what it should and should not be, etc. I'm all for that. But we were facing a crisis of epic proportions...one that had to be addressed. It was not the time to debate how much the government did or did not do to contribute to that problem. It was not the time to have a classroom debate on how involved the government should be in the economy. No, it was instead the fact that we faced not being able to buy homes, cars, consumer goods and within a few weeks...groceries. As I stated above, the response I've gotten so far on that is nothing short of "ahhh, heck...that wasn't going to happen, SDW! It would have been tough, but we'd be fine!" But every person in the know disputes the notion that we could go to bed and then everything would be fine when we woke up in the morning.

I challenge the fundamental notion that only government could have addressed the problem it created in the first place.

And please quote me where I said that if government had not acted, we would have experienced no hardship and everything would have been fine.

Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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post #106 of 152
Thread Starter 
Quote:
Originally Posted by jazzguru View Post

It is immoral for government to do any of these.



I challenge the fundamental notion that only government could have addressed the problem it created in the first place.

Eh..it's a stretch to suggest the government created the problem. It may have had a hand in it over many. many years. And if you challenge the notion...fine. But what entity could have addressed it?

And please quote me where I said that if government had not acted, we would have experienced no hardship and everything would have been fine.[/QUOTE]

My point was that you suggested doing nothing and were willing to risk calamity as a result. I'm saying that I believe it was very likely that we'd have a lot more than "hardship." I say we'd lose our entire way of live. I say we wouldn't have been buying milk in three weeks or less. My question is whether principle alone is enough to justify that.

In that vein, there was a great quote from the film "Too Big Too Fail" that applies well here. Paulson (played by William Hurt) exclaims at one point "[we're not going to let the financial system collapse in order to avoid being the guys that nationalized a few banks."] It's just a movie--and I have no idea if he actually said something like that, but I found it interesting.
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post #107 of 152
AIG would have been better off filing for Chapter 11 bankruptcy protection instead of seeking government help. I stand by that conclusion, for all the reasons I've stated. Everyone would have been better off, for all the reasons I've stated. The taxpayer-funded "bailout" was the worst possible solution.
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post #108 of 152
Thread Starter 
Quote:
Originally Posted by john galt View Post

AIG would have been better off filing for Chapter 11 bankruptcy protection instead of seeking government help. I stand by that conclusion, for all the reasons I've stated. Everyone would have been better off, for all the reasons I've stated. The taxpayer-funded "bailout" was the worst possible solution.

It must be nice to look at single firms like that, as if they were in a bubble insulated from the rest of the universe.
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post #109 of 152
Quote:
Originally Posted by SDW2001 View Post

Quote:
Originally Posted by john galt View Post

AIG would have been better off filing for Chapter 11 bankruptcy protection instead of seeking government help. ...

It must be nice to look at single firms like that, as if they were in a bubble insulated from the rest of the universe.

Those aren't my words.

Hank Greenberg said them, months after the government's nationalization:

Quote:
... Thursday, he said the U.S. government's effort to prop up the firm has "failed." AIG would have been better off filing for Chapter 11 bankruptcy protection instead of seeking government help, he said.

Must be nice to think you know better than someone who ran AIG, profitably, for over thirty-eight years.
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post #110 of 152
Quote:
Originally Posted by john galt View Post

Those aren't my words.

Hank Greenberg said them, months after the government's nationalization:



Must be nice to think you know better than someone who ran AIG, profitably, for over thirty-eight years.

What's scary to me is that he is asserting the government knew better.

Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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Malo periculosam, libertatem quam quietam servitutem.

(I prefer the tumult of liberty to the quiet of servitude.)

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post #111 of 152
Quote:
Originally Posted by jazzguru View Post

What's scary to me is that he is asserting the government knew better.

He went far beyond asserting they knew better. Upon learning of Treasury's plan, he proposed a sound alternative, which ended with the plea:

The role of government should not be to force a company out of business, but rather to help it to stay in business, especially a company that has been the pride of its industry.

His plan was rejected.

No bankruptcy court on Earth would have directed a failed company like AIG to pay a creditor - Goldman in this case - 100% of its claim.

Quote:
When the government took over AIG, why did it insist that Goldman and other firms receive 100 cents on the dollar on their AIG exposure, while the terms of AIG's own bailout were so onerous as to force the firm into slow-motion liquidation?

Might it have had something to do with Hank Paulson, who was Goldman's CEO before heading the Treasury? While I'm at it, why was Lehman - one of Goldman's largest competitors - simply allowed to die? Oh, and what about Bear Stearns? J.P. Morgan picked up its pieces at a fire sale price, and the sun came up the next morning

Greenberg's answer:

Quote:
From his present perch, he sees only three ways the AIG mystery will ever be plumbed. "Either investigative journalists continue to add the missing pieces of the puzzle," he says. "Or, two, members of Congress call for an investigation and put people under oath. Or, three, if these two things fail, aren't there likely to be class-action suits that put people under oath in depositions and discovery?"

As long as people like SDW retreat to the warm cocoon of reassurance from Government that "the end of the world" was averted, we will never know.

Who else benefitted from the taxpayer-funded AIG bailout?

Quote:
Hedge funds are the hidden recipients of the taxpayer dollars flowing through AIG. The unregulated and exclusive trading houses bet against the housing market, reaping billions as that market tanked.

But because they did the deals through the banks, there is still almost no transparency about which funds were involved, or how much money they could receive.

At the end of Wednesday's House Financial Services subcommittee hearing into AIGs bonuses, Rep. Marcy Kaptur, D-Ohio, asked AIG CEO Edward Liddy for information about the hedge funds who they are and how much bailout money they got.

"They are not our customers," said Liddy. "What you are asking is 'What did they [the banks] do? Who are their clients?' I dont have any answers to those questions."

So far, those questions remain almost completely unanswered.

Get this: No one - not even AIG's CEO, in sworn testimony before Congress - really knows where our money went.

The whole sordid affair stinks to high heaven. There have been Congressional investigations into scandals that aren't one iota of this whopper, yet we were told the only solution was to throw billions of taxpayer dollars at the problem... to prevent "the end of the world!"

The fact that a sitting President, Congress, and probably millions of Americans simply rolled over on this is proof positive that the "big lie" theory is as effective as ever.

Quote:
"Let me be clear," Mr. Greenberg said. "AIG's business model did not fail, its management did."

To paraphrase, the free market didn't fail. Government failed by preventing existing free market remedies to function - in this case, Chapter 11 reorganization, completely open under the light of public scrutiny, in which all stakeholders are granted equal representation.
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post #112 of 152
Agree with regard to the AIG bailout. Let failed businesses go bankrupt.

With regard to AIG interested parties, the investors I couldn't care less about. All investment carries risk. If they had all their eggs in this basket, then it's their fault for being careless investors in the first place. As for the policy holders, some policies will be sold. Other people will lose coverage. That might teach us not to depend on insurance, and will teach insurance companies to be more conservative (a good thing) and will force another solution to the health care crisis (insurance is NOT a solution, be it mandatory or voluntary). Cut the cost of health care by cutting the red tape and by allowing competition. And then it won't be so costly for the government to offer universal aid, and the government can actually cut health care spending while increasing coverage. Win, win. If the government needs to spend money to save the insured persons affected by a failed insurer, then help the insured persons directly. Not the failed insurance company.
post #113 of 152
Quote:
Originally Posted by john galt View Post

To paraphrase, the free market didn't fail. Government failed by preventing existing free market remedies to function - in this case, Chapter 11 reorganization, completely open under the light of public scrutiny, in which all stakeholders are granted equal representation.

Chapter 11 is not a free market remedy. If it were a free-market solution, it wouldn't be chapter anything.
post #114 of 152
Quote:
Originally Posted by tonton View Post

Chapter 11 is not a free market remedy. If it were a free-market solution, it wouldn't be chapter anything.

This isn't necessarily so.

First, let's examine this from a pure anarchist perspective. Even in the total absence of the state, society does and would develop rules, standards, patterns and, you might say, traditions for dealing with all kinds of situations. Surely private courts, over time, would establish something similar to what we call Chapter 11 (and even Chapter 7). This is called common law. In fact, I suspect, these bankruptcy laws have their roots in English common law...law that is developed over time and eventually codified as situations presented themselves to be resolved. Provisions for these kind of situations would likely, over time, be built into the contracts when dealing with any entity that might go bankrupt.

But second, not everyone wants no government. Even me as a professed anarchist would settled for some amount of formal government that was structured to maintain order in society and protect the basic rights of life, liberty and property of its citizens. In such a state, its not inconceivable there would still be bankruptcy laws and you could still call the vast majority of what's going on in that society and the state's interaction with it a free market.

The state is nothing more than a criminal gang writ large.

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The state is nothing more than a criminal gang writ large.

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post #115 of 152
Thread Starter 
Quote:
Originally Posted by john galt View Post

He went far beyond asserting they knew better. Upon learning of Treasury's plan, he proposed a sound alternative, which ended with the plea:

The role of government should not be to force a company out of business, but rather to help it to stay in business, especially a company that has been the pride of its industry.

His plan was rejected.

AIG did stay in business. Did it not?

Quote:

No bankruptcy court on Earth would have directed a failed company like AIG to pay a creditor - Goldman in this case - 100% of its claim.

AIG didn't pay...we did.

Quote:



Might it have had something to do with Hank Paulson, who was Goldman's CEO before heading the Treasury? While I'm at it, why was Lehman - one of Goldman's largest competitors - simply allowed to die? Oh, and what about Bear Stearns? J.P. Morgan picked up its pieces at a fire sale price, and the sun came up the next morning

Greenberg's answer:


As long as people like SDW retreat to the warm cocoon of reassurance from Government that "the end of the world" was averted, we will never know.

Who else benefitted from the taxpayer-funded AIG bailout?



Get this: No one - not even AIG's CEO, in sworn testimony before Congress - really knows where our money went.

The whole sordid affair stinks to high heaven. There have been Congressional investigations into scandals that aren't one iota of this whopper, yet we were told the only solution was to throw billions of taxpayer dollars at the problem... to prevent "the end of the world!"

The fact that a sitting President, Congress, and probably millions of Americans simply rolled over on this is proof positive that the "big lie" theory is as effective as ever.

Bullshit. You have one man's thoughts, thoughts which you've extrapolated upon. Nothing more.

Quote:



To paraphrase, the free market didn't fail. Government failed by preventing existing free market remedies to function - in this case, Chapter 11 reorganization, completely open under the light of public scrutiny, in which all stakeholders are granted equal representation.

I maintain that AIG filing Chapter 11 would have had disastrous effects. You can continue to speculate that it would not have if you wish.
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post #116 of 152
Quote:
Originally Posted by SDW2001 View Post

I maintain that AIG filing Chapter 11 would have had disastrous effects. You can continue to speculate that it would not have if you wish.

You keeping saying things like that as if to imply that you're not speculating about what would or wouldn't have happened.

The state is nothing more than a criminal gang writ large.

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The state is nothing more than a criminal gang writ large.

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post #117 of 152
Quote:
Originally Posted by tonton View Post

Chapter 11 is not a free market remedy. If it were a free-market solution, it wouldn't be chapter anything.

That's a faulty presumption - the free market confers no guarantee of success. Freedom assumes as much freedom to fail as it does to succeed.

When inept, corrupt, or criminal mismanagement results in a business's failure, propping it up distorts the free market. It suborns incompetence. Why do you suppose there's so much of it?
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post #118 of 152
Quote:
Originally Posted by SDW2001 View Post

AIG did stay in business. Did it not?

Yes, as a nationalized entity, a zombie condition inconsistent with any free market conception of what it means to be "in business":

Quote:
This transformation of the USA into a country where there is socialism for the rich, the well connected and Wall Street (i.e. where profits are privatized and losses are socialized) continues today with the nationalization of AIG.

...

But if the action of the Fed are aimed at facilitating an orderly selling of AIGs assets how does the Fed ensure that its investment in AIG is safe? In a formal bankruptcy (Chapter 7 and 11) there is a stay on the claims of a firm creditors; thus a roll-off of their claims cannot occur. But in this government takeover of AIG how does one ensure that such roll-off of claims does not occur?

The only way to avoid such risk is to impose a stay like in a formal Chapter 7 or 11 on such claims. But if the objective of the government was to avoid a disorderly workout that a formal bankruptcy would have entailed how does one ensure short of an effective stay on all creditors claims that the public money provided to AIG (the $85 billion loan) is not used by the unsecured creditors of AIG to roll off their exposure and run out of AIG scot free? Short of such a stay the apparent seniority of the government claims implies that any short term creditor of AIG should cut off its exposure and run. And if instead (if because again the Fed has not given any details on this crucial issue) the government claims are ensured by an effective stay on such creditors roll off then why did the government intervene in AIG rather than letting it go into Chapter 7 or Chapter 11 bankruptcy court?

The transformation of the USA into the USSRA (United Socialist State Republic of America) continues at full speed with the nationalization of AIG
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post #119 of 152
Quote:
Originally Posted by john galt View Post

That's a faulty presumption - the free market confers no guarantee of success. Freedom assumes as much freedom to fail as it does to succeed.

When inept, corrupt, or criminal mismanagement results in a business's failure, propping it up distorts the free market. It suborns incompetence. Why do you suppose there's so much of it?

You got my meaning wrong. I'm not saying that in the free market there wouldn't be an arbitration-like equivalent to Chapter 11. I'm saying that it wouldn't be called "Chapter" something, which is its title under the legal code.

As it stands, Chapter 11 is codified in law, which makes it absolutely NOT a "free-market solution".
post #120 of 152
Quote:
Originally Posted by SDW2001 View Post

I maintain that AIG filing Chapter 11 would have had disastrous effects. You can continue to speculate that it would not have if you wish.

I began this by asking what "taken down the whole system" meant to you, and you responded quite clearly that it meant "the end of the world". You later defined this to mean looting, imposition of martial law, the end of America and perhaps the world. Literally.

The ultimate effects of nationalizing private businesses bring us far closer to all those possibilities than bankruptcy.
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