Monday, November 17, 2008

Socialism For Who?

Another great letter by Alan, reinforcing my point that we are socializing the risk while continuing to privatize the gain.....

'Socialism for the rich'
11/16/08 20:10:40
The Associated Press story [Nov. 13], "Bailout course shifts abruptly," represents the third incarnation of how we bail out "free market capitalism" with "socialist underpinnings." This must be a free marketeer's nightmare.
Nevertheless, Reagan free marketers brazenly demand that ineffective government should just give them the money and then get out of the way, so the same free market concepts that got us into this mess can solve the problem. Someone said "Insanity is doing the same thing over and over again and expecting a different outcome."
Here are some of the terms of the bailout plan's third incarnation.
"The guidelines urge institutions to continue lending to credit-worthy borrowers and to work with mortgage borrowers to avoid defaults."
"The guidelines encourage the banks to set dividend payments for shareholders and compensation for executives with the current crisis in mind."
"The government hopes they will use (the money) to resume more normal lending operations."
When banks give you money, do they "urge," "encourage" and "hope" you use the money for its intended purpose? So far the money has been used to pay for dividends, bonuses and bank mergers. Aren't "free markets" really "socialism for the rich" in disguise?
Alan Cheah


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