The irony is staggering. Chris Pummer, from the pro-business website marketwatch.com, wrote, "As free-market-loving Americans, we all know overregulating an economy amounts to socialism. We're now discovering what happens when you underregulate -- communism. The $85 billion federal loan guarantee for insurance giant American International Group is being characterized as a bailout when it's actually a buyout -- with the government taking an 80% stake in the world's 18th largest company. The brutal irony: A conservative GOP administration has essentially nationalized the country's largest insurer."
Just ten days ago, the Wall Street Journal editorialized that raising taxes in California and New York would lead to slower growth and hurt the economy. At the same time, the "Bush administration is already forecasting that the federal deficit will hit a record $482 billion next year. Analysts say the bailout costs mean a $1 trillion annual deficit is not out of the question. " Where does the WSJ think this money is going to come from, if not tax increases? Apparently, the WSJ is opposed to taxes for schools and health care, but using tax dollars to prop up entire economic sectors -- whose failures are the direct result of corporate malfeasance -- is OK. Now, even builders and developers -- the most anti-tax, anti-government, anti-regulation group in modern politics -- are begging for government intervention in order to prop up their industry. If the WSJ wants to restrain government spending, perhaps they could start by looking in the mirror.
The only thing that would make me feel a little bit better would be if some of these corporate criminals were actually held accountable. I couldn't agree more with the editorial board of the News Tribune:
"...[F]ederal officials have little choice but to pay the price for past failures to regulate... Only one problem: The bill will be sent to American taxpayers, who – aside from foolish homebuyers – have been innocent bystanders in all this... Taxpayers won’t see many dividends from their 'investments' in bad debt, but they do deserve to see some justice... Watching CEOs walk away from failed companies with millions of dollars in their pockets has been the single most grating thing about this debacle. Others may be guilty of outright thievery. The safer banks are probably rife with personal accounts filled with ill-gotten gains. That money belongs in the U.S. Treasury. "
Amen. -- Dennis