Bailout Bonanza

*Originally published on 3/17/09



On the off chance you weren't aware, our economy isn't doing so well at the moment. Newly elected president, Barack Obama, has been doing everything in his power to get things turned around. His first course of action was to pass an $800 billion dollar bill. A lot of it goes towards job creation, researching new energy sources, infrastructure and the like which is fine. There is also some tax cuts and, of course, some pork spending.

This ginormous spending bill comes hot on the heels of the $700 billion dollar TARP that Bush signed into fruition at the twilight of his presidency. Where did that money go? Well, only half of it has been spent, they are still trying to decide what to do with the other half. The first half went directly to the banks to, supposedly, get some money flowing and loosen up credit. Did it do that? Not really, actually it didn't really do anything. Why? Because the corporate execs spent it all on lavish getaways and parties.

The car companies got their bailout, though not as much as they wanted and with much stricter regulations. They complained, asking why the congressmen weren't so strict with the banks. It's funny because they were asking in an attempt to get free money, but they raise a legitimate question. Why the heck did we just give the corrupt execs who drove their companies into the ground free money to piss away as they pleased?

Companies asking for government assistance isn't unfamiliar territory. The airlines needed help a few years back (speaking of which why did they allow Hooters Air to go under? finally there was an airline worth saving and they do nothing, go figure) and the car companies took out a government loan. The difference is that they could, and would pay the government back. As of now, all the CEO's see these bailouts as free money. When asked what was going to stop the car execs from coming back in a few months to ask for more money, they flat out said that they were going to come back.

Back during the election, John McCain was saying that he was going to use the $700 billion to pay off the bad mortgages and wipe the slate clean. That seemed like a more logical solution. Even noted left winger Jon Stewart said that it would've been more effective to give the money to the working folk, who would then pay off their debts and free up credit. It's funny to hear pundits complain about that theory. They say that all people would do with the money is save it or pay down their credit card debt. I don't want to sound like a lame 90's sitcom character, but duh!!!!

Others complain that if you pay off the bad mortgages, you're still punishing irresponsibility. I'm not sure about that. I mean, if you paid off the whole thing in full, then yeah you've got a point. However, if they just knock a chunk off then that will make it easier for people to pay off the remaining balance. You could give money to people who haven't foreclosed or defaulted so that they too can get some relief. With all that money that's being thrown around, I don't see why you can't spread it around, especially since that was Obama's running theme throughout the election.

Of course that alone won't fix our economy. I think that it will go a long way to fixing it though. The banks will get their money so they won't tank, people will have a lot less debt weighing them down and credit will be freed up, making it easier to negotiate reasonable terms when buying a car or house. Banks will also go out knowing that it is better to deny a person a mortgage than it is to let them have a house they can't afford.

As I said before, one of the major facets of the bill is job creation. One major tag on the bill is new energy sources. This is good as it solves several problems at once. It creates jobs, gets us off foreign oil and cleans up the environment.

There is also infrastructure, fixing the power grid and roads etc. I'm OK with this for the most part, as Obama even says that one of the major goals of the bill is to provide a jolt to get the economy going again. However, RNC Chairman Michael Steele has a point when he says that this creates work but not jobs. I mean, yes people will be employed for a couple of years and it is work that needs to be done, but when it's all fixed, what happens to those people?

O'Reilly describes this bill as a roll of the dice. I'm giving Obama the benefit of the doubt as he seems fairly smart. I think the government learned from the first bailout so hopefully they manage this one better. You still have $350 billion in TARP money and the whole of the second package. Whatever you spend it on, make sure that at the end of the day we've got something to show for it. I know Democrats have a reputation for spending tax money with impunity, these bills certainly help perpetuate that stereotype, but this is not the time for wheeling and dealing. Spend, but spend wisely. We really can't afford to have you guys screw this up.

Also, if the government is going to intervene, make sure those incompetent rubes who call themselves CEO's get thrown out on the street. No cushy job, no golden parachute, they drove our country into a tailspin it can't seem to pull out of. Don't, I repeat, don't let them walk off into the sunset with a huge check. You have the IRS at your disposal dangit, repossess the money and use it to help fix our country.