Someone asked me about the economic crisis. I am hardly an expert on this of course, but it is the most important news story going on right now. NOTE: dealing with this topic requires at least mentioning some political stuff, so if you are offended by possible discussion of politics, quit reading now. As a test I will allow non-baseball discussion in this thread, but please keep things civil and avoid flamewars.
Here's my take on the economy. DISCLAIMER: I am not an expert, and the Bush years have pushed me pretty far left ideologically.
I'm something of a permabear and have been saying for years that there was too much debt in the economy. Our manufacturing base has been hollowed out, and for a variety of reasons middle class incomes have been stagnant for years. This couldn't be sustained indefinitely, and it's coming home to roost now.
The Wall Street bailout being discussed these days pisses me off on numerous levels. What they are talking about basically is nationalization of the mortgage and investment banking industries to prevent a wider collapse of confidence. I can understand the motives behind it. You don't want the credit markets to seize up completely.
But the details of what the Bush Administration is asking for amounts to socialization of risk and privatization of profit: the investment houses dump their bad debt on the government and keep the good assets. The price tag is likewise obscene: $700 billion at least. I say "at least" because the Bush Administration is not known for the accuracy of their accounting statistics and financial projections.
Some bullet points:
**A bailout of some sort seems necessary to me, but the blank check being asked for is completely unacceptable. If Wall Street wants a bailout, there sure as hell needs to be stronger regulations and enforcement in place to prevent this shit from happening again. No golden parachutes for CEOs. Much more transparency in accounting practices. Restore regulations discarded during the 1980s and 1990s. People like Larry Kudlow may scream "socialism" when you talk about re-regulating the finance industry, but that's just hypocritical ideological bleating. You can't scream socialism on the one hand and ask for a bailout on the other.
**If we have the money to bail out Wall Street, why don't we have the money for national health insurance? This whole deal exposes the hypocrisy of right-wing economics. Trickle-down economics leads to plutocratic cronyism, socialism for the rich and well-heeled, but dog-eat-dog capitalism for the weak. It's bullshit. If we can afford to save Wall Street, we can afford to make sure that everyone has has good health coverage. There is no excuse not to. None.
**The government's balance sheet would look much better if we had gone with Al Gore's lockbox for the budget surplus instead of Bush's tax cuts. Elections matter.
Feel free to discuss this. Politics may be unavoidable in such a topic, but please stay civil.