This morning I enjoyed the spectacle of Wall Street traders bitching about the Stimulus Bill. Apparently, bailing out banks is super-fine, but helping out homeowners on the brink of foreclosure is morally reprehensible. You may wonder, as I did, how seemingly intelligent people can be so irrational and hypocritical. What "logic" are they using?
You've probably heard the expression, "Too big to fail." When I first heard it used, to justify the $750,000,000,000 bank bailout, I reasoned that it was both a scam and probably a rational necessity at the same time. I'm not crazy about capitalism for reasons that I won't go into here, but I never expected a push to nationalize the banks (surprisingly there is talk that this may be done temporarily). So that means they had to let them fail or bail them out.
So before and after the election, scores of economists and market analysts appeared on television and spoke of how there really wasn't a choice for Bush or the incoming Obama administration; the banks had to be saved to rescue America. Otherwise, everything would fall apart and we'd have to eat our pets.
Hans Gruber from Die Hard had a good plan to get away with an obscene amount of money. I'm sure you all remember that. It failed, but only because of John McLane and that fat, black cop. That was Romper Room stuff compared to the "too big to fail" bank bailout. Here we have most of $750 billion just disappearing, with shockingly little oversight, from the government or the press.
Meditate on that for awhile.
Now we have the Stimulus Bill, recently signed by Obama. Part of which is a $75 billion foreclosure bailout program, headed by Shaun Donovan, formerly of HUD. The idea is that home ownership is highly desirable, and that the government should do everything it can to prevent millions of people from losing their homes, which are also the largest investments most people ever make. A worthwile endeavor.
Capitalists need to shut the fuck up, as they have the stink of failure all over them. Banking regulation, like most regulation, has been cut back over many years in a scheme to create an unfettered, vigorous market. Ironically, and clearly, the less regulation the quicker the system self-destructs and requires massive government intervention. A totally unregulated system would last about 8 seconds, which is good for a rodeo but not for an economy. The angry, self-righteous reaction to the homeowner bailout should raise a few eyebrows, at least. Classist? Yeah, I'd say so, and it shows how the most ardent supporters of capitalism see the system. The governing principles are the same for them as they are for any grifter; get yours, and fuck everyone else.
So it shouldn't have surprised me to see a bunch of douchebag traders complaining about the "injustice" of increasing the national debt. The bank bailout increased the debt 10 times more than the foreclosure program. But surprise me it did. It took balls upon balls upon balls, especially considering that beyond Fannie Mae and Freddie Mac, private banks also bear most of the responsibility for handing out "exotic" loans to people who couldn't pay them. Of course the individual borrower is partially responsible, but banks are in the business of providing financial advice. They are the experts, the professionals. The failure to properly assess the ability of a borrower to pay his or her mortgage is primarily a failure in the system.
Permanently nationalize the banks. Provide universal, socialized health care to prevent half of all personal bankruptcy. Arrange a takeover of the automakers, as well, and run them at cost through a non-profit corporation.
But nobody asks my advice, what with all the craziness.