October 29, 2009
Quote of the Day
But as I am listening to the hearing on executive compensation and TARP special master (how crippy is this title?), I realize we are now officially living in a world that resembles an Ayn Rand novel. One man, one unelected government official, not even a Cabinet member confirmed by the Senate, has the power cut the pay of executives in private businesses by 50 percent or 90 percent in the banks the government now “owns.” A single individual is given too much power without accountability. But more importantly, this charade masks the fact that the world we live in has nothing to do with capitalism. It’s nothing more than crony capitalism. The government went around bailing out out automobile companies that were producing cars that people didn’t want to buy, bailing out banks that were careless with their capital and assets, and bailing out homeowners that couldn’t afford the houses they were buying. -- Veronique de Rugy
Posted by John Kranz at October 29, 2009 12:24 PM
Crony capitalism indeed. More and more people are publicly acknowledging that Rand's prediction has come true in the "land of the free." But Veronique obfuscates the issue by using government bailouts as her evidence.
Last night I finally got around to watching Sean Hannity's 30 minute interview with Michael Moore from earlier this month. I wanted to strangle Hannity as he tenaciously blamed "irresponsible home buyers" for the mortgage meltdown against Moore's defensible argument that it resulted from profiteering banks making bad loans. Hannity, and Veronique, really should be emphasizing the causative effects of President Carter's Community Reinvestment Act and President Clinton's use of bank regulators to compel EVERY bank to make those bad loans. I almost thought Moore and Hannity could have agreed that the enemy is not capitalism, or low-income Americans, but egalitarian government policies and regulations.
Blaming capitalism for the failures of the American economic system is like blaming oxygen for forest fires.
Crony capitalism indeed. More and more people are publicly acknowledging that Rand's prediction has come true in the "land of the free." But Veronique obfuscates the issue by using government bailouts as her evidence.
Last night I finally got around to watching Sean Hannity's 30 minute interview with Michael Moore from earlier this month. I wanted to strangle Hannity as he tenaciously blamed "irresponsible home buyers" for the mortgage meltdown against Moore's defensible argument that it resulted from profiteering banks making bad loans. Hannity, and Veronique, really should be emphasizing the causative effects of President Carter's Community Reinvestment Act and President Clinton's use of bank regulators to compel EVERY bank to make those bad loans. I almost thought Moore and Hannity could have agreed that the enemy is not capitalism, or low-income Americans, but egalitarian government policies and regulations.
Blaming capitalism for the failures of the American economic system is like blaming oxygen for forest fires.
Posted by: johngalt at October 29, 2009 2:12 PMThank you JG for exposing Hannity as an idiot on this one, although this is my main complaint against what is now called "balanced journalism" where you simply hear from wing nuts on both sides and call it balanced. Thoughtful people in the middle would obvioiusly throw everything out of balance.
Blame capitalism for failure? Failure is an important part of capitalism, surely I am preaching to the choir here? The economic system did not fail, what failed was the finance system, or the system of capital and lending. A big part of any economy to be sure, but let's be clear about what failed. Government (insert good word between encouraged and compelled) banks to make more loans so as not to discriminate against the poor(!) Banks responded by creating a mechanism of derivatives to offset their risk. Many people profited from home buyers to banks and up through all the players in the insurance and derivative markets. The one "flaw" in capitalism took over, namely the boom and bust effect as everyone piled on the money train until it became unsustainable and went bust.
With no apologies to Hannity or Moore the problem is no real discussion of this underlying elephant of an issue, do we want to control the natural boom and bust cycle of capitalism, and if so, how much can we without destroying it's benefits?
Posted by: Silence Dogood at November 1, 2009 10:05 AM | What do you think? [2]