Bailouts and Bull. Go John Go. Part One

Good day everybody.

Today I am passing along John Stossel’s special “Bailouts and Bull“(full segments here , you might have to dig after a week), ran during the 20/20 block on ABC. For years John has been the only member of the mainstream media to tackle lousy government policy, expose porkulus spending, and support libertarian ideas, and promotes free market capitalism.  His weekly 10 minute segment on 20/20, “Gimmie a Break” is probably the best reporting on TV each week it airs.  It’s a miracle his bosses at ABC haven’t fired him years ago, but my guess is they value his dedication to real journalism, and he brings in quite a bit of viewership.  Every once in a while he will get his own hour-long special, which are always fun to watch.

Milton Friedman once said of John “Stossel is that rare creature, a TV commentator who understands economics, in all its subtlety.”

Good enough for ya? Let’s get started.

**Part I**

The first segment deals with the bailouts.  The Obama administration and the rest of the government is using fear to spread their message that without a bailout, things are only going to get worse. Obama, Pelosi Biden and everyone else you can name that wants a buck has said we are in a crisis. A catastrophe that will get worse then the great depression, and if we don’t do something soon it will get there. F. U. C. Kayed!

Although the situation is bad, it isn’t that bad. The scariest part is the stock market plunge, but I have stated and even a few of my professors have said that a lot of that is due to uncertainty and poor expectations. Yeah the market took a huge hit with the bank failures, the cause of the recession. Markets need to readjust, it’s the capitalist system, and in our system no company no matter how large it is, is immune to failure. I’ve said it countless times that these banks should have just gone under, let the more stable banks buy their assets.  That sounds like a nightmare and it is for the thousands of people losing their homes. But we must remember these people couldn’t afford their homes to begin with, and it’s this climate of entitlment, and lack of regulation that put us all in this mess.

I know I just said something you would think contradictory to my previous preaching. Government shouldn’t regulate, but that not what I mean when I say things like that. Government must regulate where it protects people and businesses from getting a raw deal.  Whenever there is a possibility for someone to be cheated out of money, or freedom that is the job of government to act.  The Canadian banking system does not allow for people to walk away from debt as easily as in the US and the climate for issuing bad loans doesn’t exist as prevalently, if at all, as in the USA. So why are we in a recession, well if you are stupid enough to ask the question I might as well spell it out for you. The United States is Canada’s largest trading partner, and if the US is doing poorly Canada is always right along for the ride. If you need any proof, the biggest indicator that something is wrong in Canada, isn’t the banks, or housing market it was the fact that in December the country ran a trade deficit, for the first time since 1976.

Alright so back on topic. Stossel and the economists in this segment point out that unemployment is at 8 percent in the US, and that all the politicians seem to forget that it was worse in 1990’s when it reached 11% so how are things worse now than they were then?  The markets need to re-adjust, it needs to find the bottom, companies need to restructure and re-evaluate their plans and practices. The problem now is it isn’t happening. Companies are waiting for the check, before deciding what to do, and if they don’t get one, which most of them wont, they will have just wasted time. The stock markets are also waiting on the news; nobody wants to invest because everyone is waiting to see who is getting help and who isn’t. The Paulson Bailout and the Obama Porkulus, is interfering with the market’s ability to re-adjust. They are messing with the natural order. Everybody knows markets go through re adjustment, to fix its flaws. Recessions punish those companies that made bad decisions.  It is now a fact that the bailouts are extending the lifespan of this recession.  Until investors feel safe to re-enter the market, we aren’t going to get out of this, and the so called cure is really a self fulfilling prophesy. These bailouts are causing and will cause more problems than they solve. The ongoing failures of Paulson’s spending, the secretive treasury spending, and the Obama bailouts

This is just one big excuse for the government to spend on its pet projects, one big joke on the American people, which has allowed for more government spending and billions and billions of dollars in pork in both the stimulus bill and the budget. Hope and Change was the biggest lie in American history, I’m betting a lot of independent and moderate voters are wishing now they picked McCain instead.

John asks the question, as all of us are asking as well; if the problem is debt, how is more debt going to help us? He talks to Steny Hoyer and Maxine Waters, making them eat their own words and making general fools of them.

I ask how are wasteful spending, a ballooning government, pet projects and pork going to help the economy. Every time Obama opens his lying mouth the market tanks. Investors don’t want government solutions; they want them to stay the hell out of the way. Let them invest knowing that the other guy isn’t going to get a Monopoly Community Chest card(congrats you have poor business strategy and lost millions and might be a criminal, get out of jail free,  and pass GO a 50 thousand times). The government is going to have to print money to pay for a lot of this, and that means we are all well and truly Fudged. Over the next decade look for soaring inflation.  The sooner the government backs off the sooner we can get back on the road to recovery.
I’m going to call it quits for now, the rest of my commentary on “Bailouts and Bull” will be provided in subsequent posts. Take care everyone.