That's 700,000,000,000 US dollars. That's roughly $2,000 worth of new debt that each one of us Americans would accrue should this bail-out plan go through. So once again, Joe & Jane America would have to foot the bill for Corporate America's colossal blunder. Nice. Hope you all invested your $600 stimulus check wisely!
So who's going to bail out all those poor souls who lost their homes... ????
Uriel
I read somewhere that this could cost every American household ten grand. Ten grand! A la verga!
If I am not mistaken, deregulation was a big pet project of Ronald Reagan and his trickle-down bullshit -- the type of trickle known as Don't piss on my back and tell me it's raining, apparently! So this mess has been a long time coming -- we can't even really blame this guy or that guy or one administration or another. We can, however, marvel at how the party that is supposed to be all about fiscal conservatism and financial prudence has presided over an economic ass-fucking of truly John Holmes proportions -- pardon my French. Mybe some big government IS a good thing. Don't be whining now about tax-and-spend Democrats -- there is no way any taxes are going to go down for the next decade or so while we workers foot THIS bill. And libertarians? Don't even talk to me about libertarians. I always took a dim view of the idea that the free market would solve all ills and act as its own checks and balances, and I think now the worthlessness of that idea speaks for itself in the headlines!
Alan Greenspan must be jumping for joy that he retired just in time and left Bernanke holding this bag -- they used to call Greenspan the most powerful man int eh world, because he controlled the US economy, and wherever that goes, so goes the rest of the planet. He couldn't put a foot wrong in all those years -- and yet it's all come crashing down now? The seeds of destruction were sown in his tenure.
God, I miss Bill Clinton. Bring back our budget surplus, cheap gas, and oral sex in the Oval office, indeed!
KSa
As a socialist (please do not confuse it with a "communist") I'm kind of satisfied to see the triumph of the state's budget intervention and the total failure of the liberal, capitalist economy. Let us see how it's gonna develop, though...
Uriel
I find myself amused that the House has rejected the bailout. Probably that's my total lack of economic savvy at work, but I wasn't too thrilled about the public (i.e., me) having to foot the bill for someone else's private-industry mistakes. After all, I don't own any stocks, and I've never defaulted on my mortgage. Why is it suddenly my problem? Let the senior executives of these companies go a year without pay -- that should raise a little cash. They're making ridiculous money, and they are senior bankers and investors -- surely they have invested their earnings up to now wisely enough to get by, right? After all, these are their companies failing, due to their management decisions -- they broke it, let them buy it, as the saying goes.
I find it equally amusing that the Republicans have turned against this bill and its biggest cheerleader -- Bush. Which actually makes a lot of sense -- socializing the system is anathema to any red-blooded Repub. But to give such an overwhelming finger to their erstwhile boss -- that man is just going down in FLAMES! He can't even slink through his last three months in office quietly -- no, he's bringing the whole logpile down on his head with every increasingly desperate move. Talk about reaping the whirlwind -- he could not go out more humiliated than with the national debt at a staggering high (contrary to all tenets of fiscal conservatism), not one but TWO expensive wars going nowhere in a hurry (what happened to "Mission Accomplished" again?), the economy crashing down around his ears, and his own party pretending they don't know him anymore -- to the point where he's having to cozy up to the Democrats -- and even that's not working!
If he's not drinking again at this point, I can't imagine why not.....
greg in noord-frankrijk
Re: Bail-out or Bust
Elaine wrote:
$700 Billion...
That's 700,000,000,000 US dollars. That's roughly $2,000 worth of new debt that each one of us Americans would accrue should this bail-out plan go through.
If the overall figure does include governmental actual recapitalisation AND potential liabilities, then it's not that much, you know... Might be even worse in the near future. However, if 700 is the real cash injected so far, then you should start to worry a little bit indeed...
Loic
So the Big Three of Detroit are going cap in hand to the Government for a share of the TARP as well. It seems to me that bail outs do not just stop at finance titans such as AIG or Citigroup; it also includes the denizens of Motown as well.
Ford, GM and Chrysler are asking for $34 billion of (american) taxpayer-funded loans to help them stave off bankruptcy. That is a huge dollop of cash by any standards. This will however probably not discourage Congress from granting some form of relief. Less certain is whether help will come soon enough and whether even the gargantuan sums that the car companies are pleading for would be enough to save their hides. GM and Chrysler are already teethering on the edge of bankruptcy; Ford has a far healthier balance-sheet.
Honestly, it would be a shame if any of these great american companies are allowed to go. $34 billion might seem like a colossal amount, but if extending the credit line to them means accelerating the design and production of more fuel-efficient cars, this would not be such a bad thing after all.
Patrix
Detroit Big 3 can hardly make it through this time
I'd have to say that Workers Union of US Auto Industry (sorry I don't know its precise name) made a very stupid mistake by refusing to cut salary. The whole industry doesn't have a second choice--even if it accepted the salary reduction, the US auto industry can hardly make it through the crisis this time. Salvaging the auto industry by injecting funds into it is like putting out a fire by throwing money onto it. The Archilles Heel of US auto is its business mode--compared with its German or Japanese counterparts, the American auto industry seems more vulnerable to business climate changes, largely because it does not have its own competitive advantage that is truly valued by consumers. It'll be useless to save such an industry that lacks economic viability.
However, I do think that at one of the big 3 should and can survive the current economic winter under strong government support, partly because if all 3 die the American industry dies with them, more workers will be laid off, the situation will deteriorate, things will be even more unpredictable; and partly because the United States as a world leader in science and technology is capable of reviving an industry if it wants to, altho it takes time to create a new business mode, but it'll be a waste to split the economic resources supposed to be spent on R&D into 3 parts and let them burn them separately. As far as I can see, the US government should force the big three into cutting costs by pledging to bail out only the last one to fall. The market share of US autos will fall significantly and in a long time people will not see a rise, but by doing so the seed for potential revival will be planted and hibernation is not as good as the normal state but it's better than permanent slumber.
I still have faith in the American auto industry.
Patrix
Amazing!
KSa wrote:
As a socialist (please do not confuse it with a "communist") I'm kind of satisfied to see the triumph of the state's budget intervention and the total failure of the liberal, capitalist economy. Let us see how it's gonna develop, though...
You're a socialist? Are there still socialists in Eastern Europe? I have a stereotyped impression that all Eastern Europeans are radical capitalism and democracy advocates! Amazing!
Amazing!