Atlas Shrugged: The Mocking

Monday, September 29, 2008

The House Always Wins

Superstitious folk like to say that the most clever thing the Devil ever did was convince the world he didn't exist. That's not true on many levels, but the basic principle does work: Get people to argue about irrelevant details and they will totally overlook the big picture.

We should not be bailing out Wall Street. Giving more money to the people who already lost billions is the height of stupidity. Liberals are arguing with great passion about the details of the bailout, hoping to "win" by putting their slant on it, but they are not saying that the bailout mustn't happen. If you are arguing on the other side's terms, you have already lost.

From Angry Bear:

Joseph Stilgitz asks tough questions at The Nation:

The champagne bottle corks were popping as Treasury Secretary Henry Paulson announced his trillion-dollar bailout for the banks, buying up their toxic mortgages. To a skeptic, Paulson's proposal looks like another of those shell games that Wall Street has honed to a fine art. Wall Street has always made money by slicing, dicing and recombining risk. This "cure" is another one of these rearrangements: somehow, by stripping out the bad assets from the banks and paying fair market value for them, the value of the banks will soar.

There is, however, an alternative explanation for Wall Street's celebration: the banks realized that they were about to get a free ride at taxpayers' expense. No private firm was willing to buy these toxic mortgages at what the seller thought was a reasonable price; they finally had found a sucker who would take them off their hands--called the American taxpayer.

The Bonddad Blog:

This isn't too hard people. If you're going to do this you should set a few basic guidelines. One -- those who made really stupid decisions in buying this paper without analyzing it should not be able to dump it at an above market rate. Letting them do so subsidizing that mistake on the backs of taxpayers.

Michael Hudson, former Wall Street Economist:

What it can do is provide a one-time transfer of wealth to insiders who already have been playing the debt-credit system and siphoning off its predatory financial proceeds to themselves. The Wall Street bankers, brokers and fund managers to whom I’ve been speaking for many decades all know this. That is why they pay themselves such large annual bonuses and large salaries each year. The idea is to take as much as you can. As the saying goes: “You only have to make a fortune once in a lifetime.” They have been salting away their fortunes year after year, mainly in hard assets: real estate (free of mortgages), fine furniture, boats and trophy art. One last $700 billion heist and they can make their getaway.

Naomi Klein:

What Gingrich's wish list tells us is that the dumping of private debt into the public coffers is only stage one of the current shock. The second comes when the debt crisis currently being created by this bailout becomes the excuse to privatize social security, lower corporate taxes and cut spending on the poor. A President McCain would embrace these policies willingly. A President Obama would come under huge pressure from the think tanks and the corporate media to abandon his campaign promises and embrace austerity and "free-market stimulus."

We have seen this many times before, in this country and around the world. But here's the thing: these opportunistic tactics can only work if we let them. They work when we respond to crisis by regressing, wanting to believe in "strong leaders" - even if they are the same strong leaders who used the September 11 attacks to push through the Patriot Act and launch the illegal war in Iraq.

So let's be absolutely clear: there are no saviors who are going to look out for us in this crisis. Certainly not Henry Paulson, former CEO of Goldman Sachs, one of the companies that will benefit most from his proposed bailout (which is actually a stick up). The only hope of preventing another dose of shock politics is loud, organized grassroots pressure on all political parties: they have to know right now that after seven years of Bush, Americans are becoming shock resistant.

But we aren't. We'll do what we're told, close our eyes, and hope for the best. We will do nothing to save ourselves, because to do that will be to admit that Americans are not the best and brightest, our ideals are a thin veneer created to hide the greed and naked callousness of our ruling class, and, at long last, we can no longer force others to suffer so we that can prosper.

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