Hang on: Things are getting ugly

Maybe it was necessary, this establishment-endorsed, fear-driven, hastily constructed $700 billion bailout gamble meant to avoid a devastating credit crunch. But whether it was or wasn’t, it is towing something politically perilous in its train.

Again and again, this Wall Street package will be used as an excuse to try to take freedom out of our markets, to throttle them with excessive regulation and leave them shorn of the innovation and energy that add up to prosperity. It will be used as an excuse for something else, too — the creation of a European-style welfare state.

We’re already seeing Barack Obama and other leftists yelping about deficient regulation, not just of those financial institutions that seemingly went bonkers, but of our system as a whole, as if there are too few rules and too little enforcement, as if the discipline of the market is a fiction and as if wealth creation is finally the consequence of blessedly wise, even omniscient bureaucrats.

A chief argument on behalf of a commercial police state will be that it was regulatory laxity that gave us the moment’s pandemonium when, in fact, the main instigating factor was Democratic-sponsored social engineering abetted by the Federal Reserve’s easy-money policies, ultimately leading beyond a doubt to irresponsible executive behavior in private institutions.

Vociferously and loudly, Democrats and some Republicans sought for years to push banks to give more mortgage loans to people who could not afford them, even going so far as to twist arms at quasi-governmental Fannie Mae to let up on the credit constraints of mortgages it would later acquire. The policies were big-hearted but small-brained, as some critics were pointing out years ago, saying that the government might eventually have to ride to the rescue.

Contrary to Obama mythology, the Bush administration has been trying since 2001 to bring Fannie Mae and Freddie Mac under control, warning about some of the very problems we are now seeing. As a Heritage Foundation analyst tells us, the administration was also increasing the country’s regulatory burden, though we are hardly bereft of rules and regulators. James Gattuso reports that more than 50 agencies are presently charged with enforcing 145,000 pages of the dictates.

Some rules of the road are obviously needed to keep traffic moving and avoid collisions, and it would have been nice if we had had the foresight to keep our financial institutions from doing what they did, although you can bet none of them is going to engage in similar behavior anytime soon, regulations or no regulations. The bigger question is whether we are going to ignore the Heritage and other studies that have shown how low levels of economic freedom have constant company — low standards of living.

Besides the call for regulatory vengeance against the corporations that mostly serve the common good, we are already hearing that if you can bail out the Big Boys on Wall Street, you can initiate all manner of new social programs. The first and most obvious point in response is that any program ought to be evaluated on its own merits, not by making reference to some other policy intended to save us all from catastrophe, and the second is that expensive, new social programs can be antithetical to the welfare of those they are intended to help.

Obama wants all manner of such programs on top of the $40 trillion in unfunded liabilities owed to Social Security and Medicare. As another Heritage analyst recently pointed out, that obligation could eventually bring us to the equivalent of a yearly Wall Street bailout. The financial bailout necessitates economizing, not spendthrift merriment that could bring us to economic ruin, but it also gives the left a pretext for social action.

Watch out, everyone.


(Jay Ambrose, formerly Washington director of editorial policy for Scripps Howard newspapers and the editor of dailies in El Paso, Texas, and Denver, is a columnist living in Colorado. He can be reached at SpeaktoJay(at)aol.com.)


  1. frank verismo

    Despite the best efforts of a dying corporate media, a great awakening is taking place. The blame is being placed where it actually belongs in daily increasing numbers.

    “It will be used as an excuse for something else, too — the creation of a European-style welfare state.”

    Of course, this was the plan all along. The road to global feudalism is paved with such delights:

    Rowan Gaither was at that time president of the Ford Foundation. Mr. Gaither had sent for me when I found it convenient to be in New York, asked me to call upon him at his office, which I did, and on arrival after a few amenities, Mr. Gaither said: “Mr. Dodd, we’ve asked you to come up here today because we thought that possibly, off the record, you would tell us why the Congress is interested in the activities of the foundations such as ourselves.”
    Before I could think of how I would reply to that statement, Mr. Gaither then went on and said: “Mr. Dodd, all of us who have a hand in the making of policies here have had experience operating under directives, the substance of which is that we shall use our grant-making power so to alter life in the United States that it can be comfortably merged with the Soviet Union.
    ” Norman Dodd, Congressional investigator.

    With the great levelling now truly underway, it’s no longer difficult to see exactly what Rowan Gaither meant. World Government by the elite banking interests. Utopia for them – dependency and serfdom for us.

  2. Malibu

    Absolutely! The One World Government has been a secret agenda for many years. It began to surface after WW2. Anyone in government can easily get the bug of world leadership as it goes with the great American dream. It surfaced under President Bush 41 who openly talked about his One World Global Governance. The Platform under this President called out for America to push Democracy in the Middle East and other areas of the globe.

    He lost his reelection and we waited to see what his son would use for an agenda. He changed the GOP into the party of White Evangelical politicians. This led naturally into the One World Order with a participation of the “end of times.” This was obvious to me but I had no place to discuss it as the internet was divided up into Socialistic Liberals and Social Conservatives.

    We may be seeing the truth here this morning with this Commentary by Jay Ambrose and a reply by Frank Verismo.


  3. Malibu

    Frank Verismo, I just checked your link of Realityzone and I am very familiar with the writings of G. Edward Griffin. I heard him lecture in Pasadena years ago.


  4. neondesert

    Amazing story, Jay.

    Even as we watch the results of unregulated financial entities piss away the retirement and pensions of 90% of citizens and drag down the entire U.S. economy – and possibly that of the world – YOUR big worry is that regulation will lead to a European welfare state.

    Watch out, everyone? We’ve been watching, and we’ve seen what happens when society allows the reckless manipulation of its currency and credit. And we recognize how a priviledged few screwed with the books, tossed middle America the bills, and ran off to a carefree retirement with hundreds of millions of dollars. The only thing you recognized was that all the activity going on around you created the opportunity to refer back to your Phil Graham playbook of paranoid economics prognostication and author another column of Grimm-like fantasy.

    Your column is as big a waste of space as this comment.

  5. Cailleach

    Neondesert, thank you! It is always heartening when someone calls out the doomsayers on either side. Your comment is not a waste of space. The regulations put into place after the Great Depression worked for more than fifty years until greedy, self-serving, voracious, gluttonous wolverines like Phil Gramm got in positions of power. Country first? My ass! Bill the bailouts to the fat cats! And yes, Jay Ambrose is an idiot. I am an artist and a designer. This crisis has made it almost impossible for me to stay alive, much less use my creativity for my small but not useless benefit of the country my ancestors fought to establish. Many, many other creative people are now blocked from contributing as well. The country is suddenly much poorer in creation and innovation and the rest of the world is leaving us in the dust.

  6. Kibitzer

    Thanks, Jay, for broaching this subject, and thanks, Frank (in particular), for responding to it. Jay is right to point out that it was liberals who brought pressure to bear for more mortgage lending for lower-income people. (Well, after all, that’s their sort of job.) But there were people who saw this as Opportunity to further their agenda. Now if we can get them hooked…and then raise the rates…and then package this stuff in such a way that it brings about systemic Crisis…voila! The makings for takeover.

    It’s called predatory lending practices, and there is an interesting school of thought that it was involved in the political assassination of NY Governor Eliot Spitzer. Google these words and you should find a video that lays out the case: how some weeks before the honey trap that took him down, he wrote an op-ed column for the Wash. Post pointing out how the Bush admin was responsible for not bringing proper oversight to bear on this practice, and he was going to organize various states’ attorneys general to address the pending problem. Can’t have that. Piece of a larger picture. Take him out.

    The people behind this are not interested in European-style welfare statism, Jay. They’re interested in corporate-government control of the planet. Aka fascism. It’s not socialists behind this; unless one means socialism for the wealthy. Aka crony capitalism.

    Which is what such founding-father stalwarts as Thomas Jefferson was worried about, and opposed, at an earlier time in the history of this republic. But that’s another story, for another blog, and thread…although: Here we are. In his worst case scenario. Coming true, before our very eyes.

    I hope we are men and women enough to rise to this occasion and dismantle this particular incarnation of that beast of old: hubris, and greed.

  7. griff

    Although it may not register with our morally superior colleagues on the left, thanks for giving credit where it is due. Most people can’t seem to grasp (or flat out refuse to) the true causes of this fiasco, and seem content to remain short-sighted and simple in their partisan blame game. Couple that with the emotional roller coaster that dominates this election cycle, and you have a recipe for more disasters in the future.