Widgetized Section

Go to Admin » Appearance » Widgets » and move Gabfire Widget: Social into that MastheadOverlay zone

A different kind of bailout

By
November 13, 2008

With the government throwing money at a failing financial system, I suggest we are losing a unique opportunity to reform and restructure our economy. Rather than put our tax dollars in the hands of institutions to trickle down to the rest of us, we should make investments in our future and give the rest to citizens to spend so that our money rises up the financial ladder.

First, the growing consensus that massive infrastructure expenditures is one of the best ways to reinvigorate the economy makes immanent sense. We have neglected our public facilities for so many years we are in danger of seeing our systems which once set the standard for the world crumble as we descend to second-world status.

But this time around the emphasis should not be on highways and airports but rather public transportation systems. We need a complete rebuilding of our rail systems, both local, regional and nationally. California has once again jumped ahead with the recent passage of an initiative to develop a high speed rail connection running from San Diego to San Francisco. Such a move not only enhances transportation options but is environmentally sound.

Yes, we need to replace and repair many roadways and bridges, but even more we need to use our tax dollars to reconstitute the very nature of our large population centers. Investments in public transportation and infrastructure that emphasizes transit hubs will help us move away from the culture destroying suburban sprawl that has atomized our neighborhoods and led to isolation and decay of the communal fabric.

We need to plan ahead for climate changes that will undoubtedly make dramatic changes to our coastlines and agricultural areas. We must plan for the power, water and ecological needs of the next century to support an ever burgeoning population.

Amid the push for aid to every financially ailing institution and economic sector, we should rethink how this money will be distributed. Rather than give yet another bailout to General Motors, Ford and Chrysler, we should let them sort out their business model on their own. Giving money to people so they can afford the kind of vehicles mandated by stringent fuel economy standards would accomplish the goal or rescuing those companies that can adapt and produce vehicles that support our long range goals.

Providing much longer and more sustaining payments to our unemployed, including reaching back to those who are no longer counted in the government numbers system would do much to revitalize our economy. Putting money in the hands of consumers seems to me to be a no brainer in a consumer based economy.

What does not make sense is to pour more money into a financial system that is the cause of the problem in the first place. We have developed a very unhealthy dependence on debt and spending future earnings today. This is a sickness that needs curing, not enabling.

Let financial institutions reform themselves by returning to sound fiscal policies, don’t reward them and their management for bad judgment. The bailout should be to the people who need bailing out – we the people – not business and financial institutions.

Yes, if we are going to socialize our economy lets at least do it the right way. Socialize for the benefit of the average citizen, not big money interests.

11 Responses to A different kind of bailout

  1. mtnmopar

    December 3, 2008 at 11:03 pm

    The current crisis was caused when Bill Clinton forced the mortgage industry to make billions of dollars in “risky” loans mostly to people who had been turned down previously. MS Reno even threatened some mortgage CEO’s with prosecution if they didn’t make the loans. I don’t think it would be a good idea to let the government revamp a system that wouldn’t be in trouble if the stupid government hadn’t screwed it up in the first place. It is going to take a time for our economy to recover but allowing the liberal/socialists to interfere would only add to the time of recovery.

  2. raedawn

    November 14, 2008 at 8:35 am

    Very well stated, Phil. I have had a hard time comprehending using the term “socialism” as an epithet. “Welfare” used to be a handy epithet too, basically meaning the same thing … being on the slippery sloap to communism. Never mind that the rest of the western nations have policies that many Americans would view as “socialism.”

    I was once a welfare mom (like Whoopie, for example), and while I did not go on to fame and fortune, I was able to go to college and then build a good career in the nonprofit sector. What really galls me is that we have already had “socialism” … for the rich, for big business, and now for pharmaceutical companies (I can attest to this as I am currently in the “donut hole,” which can only be viewed as falling off a precipice that favors profits to pharmaceutical companies, and, in my case, having to make decisions about which medicines I will take, and which I will let go until the beginning of the year.

    The one saving grace of the financial meltdown is, I hope, a clear understanding that privatizing social security into individual market accounts would be draconian and not beneficial to the people, but only to wall street. Yes, let’s let the money trickle up for a change. Best ~ Linda in Lowell

  3. neondesert

    November 14, 2008 at 10:29 am

    Oh sure. On the surface that sounds like the logical way to fix our economic mess. But you’re forgetting about the most important component: The average citizen who would benefit from your plan doesn’t contribute the tens of thousands of dollars to the political parties like the corporations do.

    So, good common-sense idea, but totally inviable…

  4. Charlie Couser

    November 14, 2008 at 11:34 am

    I concur with your conclusions, Phil; but, I have one simple question: Who is going to pay for these massive expenditures? Our children’s children are already loaded to the gills with debt. To pay for this, Uncle Sam, would simply be forced to turn on the printing presses again. This, of course, means more debt – both public and private – and ultimately, more inflation.

    There is another problem — the 5% that currently own/control most of the wealth in this country today would ultimately end up with all of the new ‘trickle up’ money in the long run. So, will anything have been gained?

  5. rjf7r

    November 14, 2008 at 12:36 pm

    I don’t mind if the wealth “trickles up” and eventually lands in the hands of the wealthy as long as it starts off in the hands of us peons. Some of it will stick on the way up, and it will do lasting good before it rises.

    The other way (trickle down), it rarely gets here.

    Bob

  6. rjf7r

    November 14, 2008 at 12:39 pm

    As an example, why not bail out US auto makers by giving citizens big subsidies to buy US autos — and their choices, i.e., the marketplace, will favor the companies that are nimble and innovative. Make the subsidy bigger for vehicles with better mileage.

  7. John1172002

    November 23, 2008 at 12:15 pm

    I think you have most of a good idea,rjf7r. My ideas simply take your ideas a little further. Let’s nationalize the automotive Big Three. Re-tool, and offer for sale to the public a fleet of automobiles that are ALL diesel powered, with the conversion package already built-in so that these cars could be run on stuff like McDonald’s waste used french-fry oil.

    This would leave people like myself with obsolete gasoline using vehicles. Within ten years or so, every car on the road would be diesel powered, and we could tell the Arabs to eat their own oil. Lord knows, the have made trillions off of us.

    John1172002

    We have heard from the small town in Texas that was missing their idiot, and they offered to pay us to keep him.

    Sadly, some Texas village is missing its’ idiot.

  8. adamrussell

    November 15, 2008 at 10:23 am

    It sounds to me like we support a failed business as a way of disguising welfare. Would be better for the country and for those workers to find them new jobs even if it meant working make-work jobs supplied by the government.

  9. gazelle1929

    November 15, 2008 at 12:44 pm

    Why do we keep talking about bailout money as if it grows on trees?

    Seven hundred billion dollars split 300 million ways comes out to almost $2,500 a head. If we were to give that amount to every American, most of them would either waste it or would pay down some of their massive consumer debt. And guess where that money goes: right back into the banks and similar creditors, most of whom would have to use it to pay down their debts. It isn’t long before all that money flows overseas because that’s there the big creditors are.

    So we borrow money to pay off money. The only ones who aren’t broker are the brokers.

    As to the Big Three: screw them. And the slow white Bronco they rode in on. They could see the handwriting on the wall years ago. They knew where we were headed. So what did they produce? Hummers. HUMMERS! Bigger SUVs. More gas hogs. It was easier to do that than it was to put the money into development of fuel efficient cars. They lobbied and lobbied and lobbied even more to kill the fuel efficiency laws that Carter got through Congress. And people today have the balls to say Carter was a crappy President. He wasn’t top ten but he certainly deserves a better press than what he has gotten just for that move, which was later gutted by (oh my could it have been) Republicans.

    I suspect that if you went back and crunched all the numbers you would find a pretty good indication that the root of our problems today (or at least one of the main roots) is the fact that the Big Three was able to get around the fleet fuel efficiency law. Of course we the people did our part by allowing that to happen, but it could be that we have learned our lesson.

    If the Big Three fail we will see a New Big Three or Five, definitely Toyota and Honda, and possibly Mercedes or Subaru for the third of the New Big Three. Kia and VW are also in contention for a Big Five, I would think.

    And all those auto workers who lose their jobs when the current Bad Big Three fold will find jobs in stateside factories that buy American parts and put together cars designed overseas. It wouldn’t be the end of the world.

  10. adamrussell

    November 17, 2008 at 9:45 am

    Spend the money on our infrastructure. Our roads, bridges, and even waterworks have been neglected for too long. Better to have autoworkers working on things that matter than those crummy cars that no one wants.

  11. gaslaugh

    November 29, 2008 at 10:03 am

    Hello…does anyone here remember when this county had lots of factories making lots of quality items to export to other countries, oh…and to sale locally in out varying communities. The good old days some would venture to say. Now this county, nation and what ever else it has become has created (along with the rest of the globe) a financial industry with newly contrived “investment vehicles” such (default swaps, MBS, CODs) and the list goes on and on, hence the word DERIVATIVE. Approximately 6 to 7 hundred trillion created worthless crap out of thin air. Packaging debt of all kind (especially mortgage debt) and then chopping this debt generically perceived (again) as “investment vehicles” into thousands of pieces called tranches was the epitome of greed and deception.

    A financial global industry base on insanity topped off with tremendous amounts of greed and other nasty stuff.
    Trying to re-inflate this bubble (thank you Allen Greenspan) by handing out even more trillions of worthless dollars is nothing but insane insanity….a whole new level of stupidity for the thousands of individuals, corporations, and government entities (cities, counties, and stats) that bought this SUPPER CRAP.

    Something is not right and what is not right has already taken this nation and this world over the cliff into the abyss.