There's room at the top, they're telling you still...

[tiurin]

I have no idea why the Democrats aren't attacking Bush continually over the state of the economy and the US Dollar. The two reasons that come to mind are that they're either utterly incompetent or disgustingly pusillanimous. Neither's a good option.

Really, I don't know why there's no liberal party in this country that's not afraid to start pushing the slogan that there are now two types of people associated with the Republican Party: millionaires and suckers. In fact, I'd even say that the Republicans have swerved so far from the "limited government" idea that traditional conservatives espouse that it's hard to classify the party anymore. Let's take a look at a few numbers.

The war in Iraq has already cost $500 billion. Joseph Stiglitz and Linda Blimes have estimated that the Iraq war will eventually cost $3 trillion. I believe this is one of three things that will eventually cause another Great Depression-scale period for this country. The $500 bil that's already been spent is absorbable, barely- though I think it would've been far better spent on darn near anything else, whether it was investing in alternative energy infrastructure(I also am amazed by Bush's ineptitude regarding the Strategic Petroleum Reserve) and research or paying down the other $9 trillion of national debt.

The Dems should also be hammering on the Republicans on the Bear Stearns bailout. Having the Fed guarantee $30 billion of Bear Stearns' assets...well, this is, to put it bluntly, corporate welfare. Heads JP Morgan Chase wins. Tails the American taxpayer loses, to the tune of about $100 each. $30 billion is a fuckton of money. By comparison, Temporary Assistance for Needy Families(TANF)- what's commonly known as welfare- costs about $16.5 billion a year. The next time any "compassionate conservative" opens his or her piehole about welfare, they should be hammered with the Bear Stearns bailout. The Republican management believes that the free market is the best allocator of resources...until it's their own that takes it in the nuts.

Bear Stearns is only the beginning, of course. I'm not exactly impressed by what I've been hearing about the Lehman Brothers' portfolio, for example. By the time the smoke clears, I expect at least one and possibly as many as three major investment banks requiring federal intervention. The taxpayer, of course, will foot the bill. If I didn't think massive inflation was going to be an issue and if I had more of a bankroll, I'd seriously consider buying puts.

The Republicans wanted deregulation. They got it. And now the subprime debacle is giving them all the deregulated market they want. The next time deregulation comes up, the Democrats need to bring up the subprime meltdown.

Finally...the tax cuts. The class warfare nature of the tax cuts has been discussed in tons of outlets. I've also mentioned how Bush departed from the usual taxation pattern during wartime. But given that our Idiot-in-Chief wants to make his cuts permanent...that'll hit us for another $1 trillion a year over the next decade. What slight chance we'd have of avoiding the complete collapse of the USD would be gone. The Democrats should be emphasizing this every time tax cuts are mentioned.

Why can't we have a _real_ liberal party in this country, not these cowardly, idiotic Democrats?

Comments

[londo.livejournal.com]

I'd be more pleased with the Bear Stearns bailout if the Fed, in return for taking any potential loss, also demanded increased profit from JPM.

As it is, every time the Fed does something like this, they send a signal to aggressive bankers that they'll do it again next time, which is of questionable value.

[dolohov.livejournal.com]

You do realize those are my initials, right? You confused the hell out of me for a second.

I'm pretty convinced that this isn't going to act like that kind of signal. BS was pretty much destroyed, and the people involved were not really rewarded for taking those risks. I just can't see any other investment bank looking at what happened and considering that a viable safety net. When push comes to shove, BS shares went from $130 to $2 in less than a year: that's just not a win for anyone. (OK, the takeover bid's up from $2 now, but presumably someone pointed out to JP Morgan that BS's building alone is worth more than that)

But just to be a wiseass, let's think about the message it sends home buyers and mortgage lenders if the Federal government is willing to step in and save them from foreclosure. Is that going to change the behavior of predatory lenders or irresponsible buyers? If the sheer volume is what triggers it, all that tells the lenders is that if they're going to screw up, they'd better screw up REALLY BIG.

[tiurin.livejournal.com]

If the sheer volume is what triggers it, all that tells the lenders is that if they're going to screw up, they'd better screw up REALLY BIG.

I think that kind of thinking has already been ingrained- just look at Long Term Capital Management. It goes back to what I said before about the idea "If you owe a bank $50,000 and can't pay it back, you have a serious problem. If you owe a bank $50 million and can't pay it back, the bank has a serious problem."