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BGonline.org Forums
What's your opinion on the $700bn bill?
Posted By: Barry Silliman In Response To: What's your opinion on the $700bn bill? (Havard Raddum)
Date: Thursday, 2 October 2008, at 10:45 p.m.
In my utopian world of a perfectly functioning free market economy, government intervention is not necessary. In the real world the free market doesn't function perfectly, and what we are experiencing now is the bursting of a bubble because imperfect individuals participate in the free market. We thought we were smarter than the previous generations and had learned how to tame the down side of business cycles. I don't think we're as smart as we thought we were.
I'm ambivalent about the bailout. I'm opposed to this intervention philosophically, and for practical purposes I'd be more enthusiastic if I thought the government could actually do more good than harm. My guess is that the U.S. is going to have a moderate to deep recession no matter what is done, and then in time it will recover. The American standard of living is probably in for a long-term decline. (My father could buy a brand-new house in a nice neighborhood on a single income of a teacher's salary 40 years ago. I don't think this has been possible for many years now). This is an inevitable effect of globalization. There are a lot of people in India and China and other places who want and deserve a decent standard of living too. A few years back I visited Hong Kong for work and then some colleagues from Hong Kong visited us here. There is a lot of wealth in Hong Kong relative to mainland China, and when my guests from Hong Kong visited here I invited them to my house. I live in a typical middle class house (Little Boxes on the Hillside...), nice neighborhood, nothing special by our standards. My friends from Hong Kong said the size of my master bedroom was as large as the entire living space for a typical family of four in Hong Kong. My point is that our standard of living can afford to decline and it doesn't mean our country will be in squalor.
(Although, and this is an entirely different topic. My niece is a schoolteacher in inner city Baltimore, and let me tell you, we have large pockets of Third World all over the U.S., they're called inner cities).
I'll still take Capitalism's excesses over the excesses of Communism, which typically result in the the murders of tens of millions of people (see Stalin, Mao, Pol Pot, et. al.)
I suppose in many of my political posts I sound pessimistic and in a state of despair. I do feel that way at times. But long term I am bullish on America- people aren't trying to sneak across the border into Mexico yet. But things do need to change in this country. While we are all freaking out about the magnitude of this bailout, consider this- the amounts talked about now are less than 1 trillion dollars. There are currently over 40 trillion dollars in unfunded Social Security and Medicare entitlements looming on the horizon. Everybody wants something for nothing.
"We have determined that your whole system sucks"
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