Too Big To Fail, Next Stage
You’ve doubtless heard, by now, how Treasury secretary and famed tax evader Timothy Geithner wants Congress to grant him power to seize any big financial firm, if he and the president say the country’s financial system depends on it. The mantra “too big to fail” has morphed into “too big to stay out of government hands.”
Obvious question: Even assuming you buy the argument “Business X is so big it simply must not be allowed to fail no matter what,” why not simply break Business X into smaller entities, a la Ma Bell and Standard Oil, rather than dig our damned debt hole even further?
Obvious answer: Letting the government seize companies at will (namely, the will to say “I’m doing this for the greater good. Honest and for true”) makes for a more lucrative power grab.
The power to break up large companies is by far the lesser of two evils. Think of the War on Drugs: while I of course oppose all aspects of it, a government claiming merely the right to imprison drug users is preferable to the system we have now, where government claims the right to imprison drug users AND confiscate their worldly possessions. The last thing we need to do is provide more financial incentives for government to be corrupt.
Meanwhile, the national debt is over $11 trillion and President Obama’s proposed budget, with its three-quarters-of-a-trillion dollar deficit, will only make that worse. Of course, fans of the president might say the national debt’s nothing to worry about: as a percentage of America’s annual GDP, we owed far more after World War Two. Despite this (the argument goes), America enjoyed fantastic prosperity in the 1950s, so we needn’t worry now.
True, but today’s situation is different. America in the years following World War two enjoyed an advantage modern America does not: we were the only major industrialized nation whose infrastructure hadn’t been blasted to smithereens during the War. It’s easy to make money when there’s no competition. (America also was a net exporter of oil in those days; rather than depend on OPEC, we could produce all the oil we needed ourselves, and sell some for a profit, too.)
Do you care to make any predictions? Mine are all too nebulous to explain; the only detail I can make out is “We’re screwed.” I can’t describe it more explicitly than that, which is lucky for you because otherwise this post would be NSFW and I wouldn’t’ve remembered to point that out until the very end, as I did here.
Obvious question: Even assuming you buy the argument “Business X is so big it simply must not be allowed to fail no matter what,” why not simply break Business X into smaller entities, a la Ma Bell and Standard Oil, rather than dig our damned debt hole even further?
Obvious answer: Letting the government seize companies at will (namely, the will to say “I’m doing this for the greater good. Honest and for true”) makes for a more lucrative power grab.
The power to break up large companies is by far the lesser of two evils. Think of the War on Drugs: while I of course oppose all aspects of it, a government claiming merely the right to imprison drug users is preferable to the system we have now, where government claims the right to imprison drug users AND confiscate their worldly possessions. The last thing we need to do is provide more financial incentives for government to be corrupt.
Meanwhile, the national debt is over $11 trillion and President Obama’s proposed budget, with its three-quarters-of-a-trillion dollar deficit, will only make that worse. Of course, fans of the president might say the national debt’s nothing to worry about: as a percentage of America’s annual GDP, we owed far more after World War Two. Despite this (the argument goes), America enjoyed fantastic prosperity in the 1950s, so we needn’t worry now.
True, but today’s situation is different. America in the years following World War two enjoyed an advantage modern America does not: we were the only major industrialized nation whose infrastructure hadn’t been blasted to smithereens during the War. It’s easy to make money when there’s no competition. (America also was a net exporter of oil in those days; rather than depend on OPEC, we could produce all the oil we needed ourselves, and sell some for a profit, too.)
Do you care to make any predictions? Mine are all too nebulous to explain; the only detail I can make out is “We’re screwed.” I can’t describe it more explicitly than that, which is lucky for you because otherwise this post would be NSFW and I wouldn’t’ve remembered to point that out until the very end, as I did here.
posted by Jennifer Abel at 6:51 PM
6 Comments:
I've had enough of this "too big to fail" newspeak.
There actually are American institutions that require preservation: The middle class is too big to fail. The American working class is too big to fail. The future of our kids is too big to fail.
But these dirtbag companies who hoped to fantastically capitalize on crushing debt, and the Washington pimps who defend them? Let 'em tank. The American economy will suffer if they stay or if they go. Since we'll all be hurting anyway, let us be rid of them.
When they say "too big to fail" they are referring to the size of the campaign contributions given to congressional re-election campaigns.
I'm still confused. What I see is taking over industries, heavily regulating them, for the "good of everyone." Today, the govt is going to do a "controlled bankruptcy" in regards to GM, creating a government owned operation out of the bones.
In regards to this, socialism, per Merriam Webster, is defined thusly:
1: any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
Yet, I hear we're not socialist, and anyone that makes that comment is looked down upon and scourged.
Can someone explain to me how it's not socialist? Bush's mistakes would have taken 6, maybe 8 years to unclusterfuck. This stuff, we're talking generations, if ever.
Yet, people don't blame Obama for this shit. Amazing.
We as a nation are utterly fucked.
Yet, people don't blame Obama for this shit. Amazing.
Although, in fairness, it is "change."
Although, in fairness, it is "change."
Yeah - but we're still fucked - and permanently, or at least until the whole thing collapses.
You know, many of the "greatest generation" actually approves of Obama's policies and the government taking over the economy. It reminds them of FDR, their hero. They think it's going to be like the 30's and the 40's and "Happy Days Are Here Again." Many have fond memories of those years. There is, also, a bunch who think we have another Kennedy in the White House - they think it's "Camelot" all over again. As is usual with most fond memories, the really shitty parts have been forgotten.
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