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U.S. government promises to bailout the world
- Thread starter redrumloa
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Ne'er a truer word spoken in jest ?
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http://www.latimes.com/news/columnists/ ... 300.column
Hey U.S., welcome to the Third World!
It's been a quick slide from economic superpower to economic basket case.
Rosa Brooks
September 18, 2008
» Discuss Article (170 Comments)
Dear United States, Welcome to the Third World!
It's not every day that a superpower makes a bid to transform itself into a Third World nation, and we here at the World Bank and the International Monetary Fund want to be among the first to welcome you to the community of states in desperate need of international economic assistance. As you spiral into a catastrophic financial meltdown, we are delighted to respond to your Treasury Department's request that we undertake a joint stability assessment of your financial sector. In these turbulent times, we can provide services ranging from subsidized loans to expert advisors willing to perform an emergency overhaul of your entire government.
As you know, some outside intervention in your economy is overdue. Last week -- even before Wall Street's latest collapse -- 13 former finance ministers convened at the University of Virginia and agreed that you must fix your "broken financial system." Australia's Peter Costello noted that lately you've been "exporting instability" in world markets, and Yashwant Sinha, former finance minister of India, concluded, "The time has come. The U.S. should accept some monitoring by the IMF."
We hope you won't feel embarrassed as we assess the stability of your economy and suggest needed changes. Remember, many other countries have been in your shoes. We've bailed out the economies of Argentina, Brazil, Indonesia and South Korea. But whether our work is in Sudan, Bangladesh or now the United States, our experts are committed to intervening in national economies with care and sensitivity.
We thus want to acknowledge the progress you have made in your evolution from economic superpower to economic basket case. Normally, such a process might take 100 years or more. With your oscillation between free-market extremism and nationalization of private companies, however, you have successfully achieved, in a few short years, many of the key hallmarks of Third World economies.
Your policies of irresponsible government deregulation in critical sectors allowed you to rapidly develop an energy crisis, a housing crisis, a credit crisis and a financial market crisis, all at once, and accompanied (and partly caused) by impressive levels of corruption and speculation. Meanwhile, those of your political leaders charged with oversight were either napping or in bed with corporate lobbyists.
Take John McCain, your Republican presidential nominee, whose senior staff includes half a dozen prominent former lobbyists. As he recently put it, "I was chairman of the [Senate] Commerce Committee that oversights every part of the economy." No question about it: Your leaders' failure to notice the damage done by irresponsible deregulation was indeed an oversight of epic proportions.
Now you are facing the consequences. Income inequality has increased, as the rich have gotten windfalls while the middle class has seen incomes stagnate. Fewer and fewer of your citizens have access to affordable housing, healthcare or security in retirement. Even life expectancy has dropped. And when your economic woes went from chronic to acute, you responded -- like so many Third World states have -- with an extensive program of nationalizing private companies and assets. Your mortgage giants Fannie Mae and Freddie Mac are now state owned and controlled, and this week your reinsurance giant AIG was effectively nationalized, with the Federal Reserve Board seizing an 80% equity stake in the flailing company.
Some might deride this as socialism. But desperate times call for desperate measures.
Admittedly, your transition to Third World status is far from over, and it won't be painless. At first, for instance, you may find it hard to get used to the shantytowns that will replace the exurban sprawl of McMansions that helped fuel the real estate speculation bubble. But in time, such shantytowns will simply become part of the landscape. Similarly, as unemployment rates continue to rise, you will initially struggle to find a use for the expanding pool of angry, jobless young men. But you will gradually realize that you can recruit them to fight in a ceaseless round of armed conflicts, a solution that has been utilized by many other Third World states before you. Indeed, with your wars in Iraq and Afghanistan, you are off to an excellent start.
Perhaps this letter comes as a surprise to you, and you feel you're not fully ready to join the Third World. Don't let this feeling concern you. Though you may never have realized it, you've been preparing for this moment for years.
***************************
http://www.latimes.com/news/columnists/ ... 300.column
Hey U.S., welcome to the Third World!
It's been a quick slide from economic superpower to economic basket case.
Rosa Brooks
September 18, 2008
» Discuss Article (170 Comments)
Dear United States, Welcome to the Third World!
It's not every day that a superpower makes a bid to transform itself into a Third World nation, and we here at the World Bank and the International Monetary Fund want to be among the first to welcome you to the community of states in desperate need of international economic assistance. As you spiral into a catastrophic financial meltdown, we are delighted to respond to your Treasury Department's request that we undertake a joint stability assessment of your financial sector. In these turbulent times, we can provide services ranging from subsidized loans to expert advisors willing to perform an emergency overhaul of your entire government.
As you know, some outside intervention in your economy is overdue. Last week -- even before Wall Street's latest collapse -- 13 former finance ministers convened at the University of Virginia and agreed that you must fix your "broken financial system." Australia's Peter Costello noted that lately you've been "exporting instability" in world markets, and Yashwant Sinha, former finance minister of India, concluded, "The time has come. The U.S. should accept some monitoring by the IMF."
We hope you won't feel embarrassed as we assess the stability of your economy and suggest needed changes. Remember, many other countries have been in your shoes. We've bailed out the economies of Argentina, Brazil, Indonesia and South Korea. But whether our work is in Sudan, Bangladesh or now the United States, our experts are committed to intervening in national economies with care and sensitivity.
We thus want to acknowledge the progress you have made in your evolution from economic superpower to economic basket case. Normally, such a process might take 100 years or more. With your oscillation between free-market extremism and nationalization of private companies, however, you have successfully achieved, in a few short years, many of the key hallmarks of Third World economies.
Your policies of irresponsible government deregulation in critical sectors allowed you to rapidly develop an energy crisis, a housing crisis, a credit crisis and a financial market crisis, all at once, and accompanied (and partly caused) by impressive levels of corruption and speculation. Meanwhile, those of your political leaders charged with oversight were either napping or in bed with corporate lobbyists.
Take John McCain, your Republican presidential nominee, whose senior staff includes half a dozen prominent former lobbyists. As he recently put it, "I was chairman of the [Senate] Commerce Committee that oversights every part of the economy." No question about it: Your leaders' failure to notice the damage done by irresponsible deregulation was indeed an oversight of epic proportions.
Now you are facing the consequences. Income inequality has increased, as the rich have gotten windfalls while the middle class has seen incomes stagnate. Fewer and fewer of your citizens have access to affordable housing, healthcare or security in retirement. Even life expectancy has dropped. And when your economic woes went from chronic to acute, you responded -- like so many Third World states have -- with an extensive program of nationalizing private companies and assets. Your mortgage giants Fannie Mae and Freddie Mac are now state owned and controlled, and this week your reinsurance giant AIG was effectively nationalized, with the Federal Reserve Board seizing an 80% equity stake in the flailing company.
Some might deride this as socialism. But desperate times call for desperate measures.
Admittedly, your transition to Third World status is far from over, and it won't be painless. At first, for instance, you may find it hard to get used to the shantytowns that will replace the exurban sprawl of McMansions that helped fuel the real estate speculation bubble. But in time, such shantytowns will simply become part of the landscape. Similarly, as unemployment rates continue to rise, you will initially struggle to find a use for the expanding pool of angry, jobless young men. But you will gradually realize that you can recruit them to fight in a ceaseless round of armed conflicts, a solution that has been utilized by many other Third World states before you. Indeed, with your wars in Iraq and Afghanistan, you are off to an excellent start.
Perhaps this letter comes as a surprise to you, and you feel you're not fully ready to join the Third World. Don't let this feeling concern you. Though you may never have realized it, you've been preparing for this moment for years.
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redrumloa said:
Come on Red, we knew you're good for it. You'll pay up eventually even if China has to come over and pull each one of your toe nails as a reminder.
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First there should be no bail out.redrumloa said:
Second if there is a bail out it's completely wrong to bail out the fat cats. This firstly reimburses the failures of the millionaires encouraging them to do it again. Second it's still the 30 year old trickle down economic concept at work, or as rightly shown in the 20s and again now does not work. IF there's a bail out give it to the home owners to find banks that are worth it and have them move their mortgages.
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Among McCain's AIG connections.
Of course, we'd likely find a lot of connections to other politicians if we looked.
Of course, we'd likely find a lot of connections to other politicians if we looked.
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Here's a nice little graph that shows why the US Govt. CAN'T bail out the world...
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This is just the way it always goes; disaster is coming, do nothing: when it happens, pull out you favoured solution and pass it in a panic.
Intelligence agencies around the world warned the US about the impending attack on Sept 11, 2001. The US intelligence warned Bush very strongly about an attack inside the US possibly involving airplanes. Bush did nothing so that the attack could go ahead and then he could pull out the pre-prepared PATRIOT act (and when there were pockets of resistance, those pockets of resistance got anthrax in the mail) and try to go to war with Saddam (which didn't work out at first but they managed to leverage it in the end).
Anyone who knew anything about hurricanes was telling everyone in authority what the risks were. For years before that, engineers were pointing out the flaws in the levee system and Washington was withholding the money to fix them. When it did finally hit the neighbourhoods where all those poor (democrat voting) folks were flooded out and their properties so damaged they are still living in trailers far from home and being prevented from returning to their homes as their properties are "eminent domain"ed away for development.
People have seen this financial crisis coming for years. Even Greenspan. Housing was an obvious bubble by 2005/6. The credit system blew up in Aug 2007. Nothing got done. Instead it was allowed to get worse and worse and worse and now IT'S A PANIC... Paulson magically produces a plan - no time to talk, no time to discuss it, hurry hurry before the world ends. Paulson's plan is pretty much, "I can do anything I like and nobody can question this or take this to court". Wow. It's the PATRIOT act of finance.
Well, at least this time it seems the politicians are a little bit more wary of this tactic. Will we see anyone getting the financial anthrax mail soon?
Intelligence agencies around the world warned the US about the impending attack on Sept 11, 2001. The US intelligence warned Bush very strongly about an attack inside the US possibly involving airplanes. Bush did nothing so that the attack could go ahead and then he could pull out the pre-prepared PATRIOT act (and when there were pockets of resistance, those pockets of resistance got anthrax in the mail) and try to go to war with Saddam (which didn't work out at first but they managed to leverage it in the end).
Anyone who knew anything about hurricanes was telling everyone in authority what the risks were. For years before that, engineers were pointing out the flaws in the levee system and Washington was withholding the money to fix them. When it did finally hit the neighbourhoods where all those poor (democrat voting) folks were flooded out and their properties so damaged they are still living in trailers far from home and being prevented from returning to their homes as their properties are "eminent domain"ed away for development.
People have seen this financial crisis coming for years. Even Greenspan. Housing was an obvious bubble by 2005/6. The credit system blew up in Aug 2007. Nothing got done. Instead it was allowed to get worse and worse and worse and now IT'S A PANIC... Paulson magically produces a plan - no time to talk, no time to discuss it, hurry hurry before the world ends. Paulson's plan is pretty much, "I can do anything I like and nobody can question this or take this to court". Wow. It's the PATRIOT act of finance.
Well, at least this time it seems the politicians are a little bit more wary of this tactic. Will we see anyone getting the financial anthrax mail soon?
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Among those who saw it coming Merkel
And others in Europe would like to see some accountability along with the rescue.
And social havens like Sweden don't just write checks when banks fail.
And others in Europe would like to see some accountability along with the rescue.
And social havens like Sweden don't just write checks when banks fail.
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redrumloa said:
Then go vote Libertarian or Constitution Party. That would be a "none of the above" vote and if those numbers ever got big enough then maybe someone up top would have to stop and worry a little.