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- JenniferInMO, on 10/12/2008, -0/+12FTA:
"Two weeks after persuading Congress to let it spend $700 billion to buy distressed securities tied to mortgages, the Bush administration has put that idea aside in favor of a new approach that would have the government inject capital directly into the nation’s banks — in effect, partially nationalizing the industry.
As recently as Sept. 23, senior officials had publicly derided proposals by Democrats to have the government take ownership stakes in banks.
The Treasury Department’s surprising turnaround on the issue of buying stock in banks, which has now become its primary focus, has raised questions about whether the administration squandered valuable time in trying to sell Congress on a plan that officials had failed to think through in advance.
It has also raised questions about whether the administration’s deep philosophical aversion to government ownership in private companies hindered its ability to look at all options for stabilizing the markets."
This is the problem with hard core ideology. That kind of absolute, black and white thinking has no place in a diverse global economy or 21st Century governing decision. The issues are too complex to refuse to consider all options. - bgberger, on 10/12/2008, -0/+9the bailout was the economic equivalent of the war resolutions.
gwb truly exposed as the worst president in the history of the USA.
where was abortion when we needed it 60+ years ago.
now it's no surprise that markets tanked in the last several weeks - it/they knew plan would not work.
too bad stupidity is not an impeachable offense. - torgarman, on 10/12/2008, -0/+6The Bush Administration pissed away any chance of using the $700B effectively. Instead of using the $700B, they are using other tools that they had before the "economic stabilization" bill passed. They lit a fire under Congress to pass the bill, and then sat back and watched the market burn down. They must be laughing their asses off at our stupidity and complacency. The last paragraph of this article says volumes:
'Some experts said the delay in carrying out the Bush administration’s $700 billion bailout plan had only hurt its prospects for success.
“Even if it was adequate before, it’s not adequate now,” said Frederic Mishkin, a professor of economics at Columbia University’s business school who stepped down as a Federal Reserve governor at the end of August. “If you delay and create uncertainty, the amount of money you have to put up goes up.”' - JPHR, on 10/12/2008, -0/+2http://www.bloomberg.com/apps/news?pid=20601087&si ...
If you read between the lines the disappointment in the US "leadership" and its lack of action is clear. Read what Lagarde is saying and the way she is contrasting the meeting in the US with the meeting in Europe. - JPHR, on 10/12/2008, -0/+2After having caused this mess the Bush neocon ideology prevented the obvious step: recapitalization of banks by acquiring a stake. No wonder that the G7 meeting in Washington was an abysmal failure and that Europe arranged a meeting later this weekend. Be sure that the approach will be recapitalization by acquiring a stake. After causing this mess the US was still intent on buying bad debt. Acquiring a stake and recapitalization is through leverage much more effective. To say that the head of the IMF was disappointed in the US is the understatement of this century.
Letting banks simply fail exacerbated this mess and caused the credit crises. That failure may be welcomed by free market ideological purists but it has only succeeded in bringing the system to the brink.
So the US is now finally forced to follow the approach of for instance Britain, Benelux, Germany and even Russia. Took its time. But still look at the end of the article Paulson or the Bush administration still demonstrate their obvious conflict of interest. Corporatism or crony capitalism still is intent on shielding shareholders and management while the taxpayer has to foot the bill. So far for their free market ideology.
Nice to note for McCain Russia's Kudrin seems to have been welcomed. Russia has already implemented actions like Britain. Remember McCain intent on kicking Russia out of the G8?
JenniferINMo's comment with respect to ideology is spot on. Ideology invariably succeeds in producing frightening train wrecks. After the disaster of the last 8 years of Neocon ideology the US is in dire need some common sense, good judgment, respect for the interests of others, some compassion and even some real socialism (health care, progressive tax, access to education).
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