Living Within Your Means

Well, the bailout or I guess I should say “rescue plan”, has failed in congress. I’ve been reading the news stories reporting on it. The one comment I found very interesting was by Rep. James R. “Jim” Langevin, a Rhode Island Democrat. He said” any proposed legislation must ensure [that] hardworking people will have access to financing for mortgages, as well as auto, student and small business loans.” I’m not trying to sound unsympathic here, but isn’t lending to people who shouldn’t have been borrowing to begin with what got us into this mess in the first place?

Very few are advising individuals, businesses, or government to live within their means. Treasury Secretary Henry Paulson said, “that reduces the availability of credit that businesses across America depend on to meet payroll and to purchase inventories.” If you as a business owner have to borrow money to meet payroll, wouldn’t that mean you were already in serious financial trouble? Maybe Secretary Paulson should reconsider his words. This is a former chairman of Goldman Sachs? Wow! Whatever happened to good old fashioned fiscal responsibility?

I’m sure the president and his cronies will try to revive this bill in some form. I hope it goes down in flames again. One congressman commented (I can remember who just now) that he had been getting calls 10 to 1 against the bailout.  Rep. Paul Ryan, R-Wis said he really wanted the bill to pass, but didn’t really want to vote for it because he was afraid of “losing his job”. He did anyway. The people are mad. They should be. Government intervention has caused me to lose 31 percent of my investment portfolio this year alone. But I don’t want policies that are simply more of the same that will cause me to lose my entire investment portfolio. I hope they’re getting the message that we will require government to live within it’s means. Or else.

Bailout? Of Whom?

I’m sorry I haven’t posted for a while, but work in the last few months was keeping me from doing anything constructive in the way of blogging. However, I have more time on my hands now, so l suppose it’s time to get back at it.

I’ve been reading and listening about the proposed bailout, and I can’t believe what I’m hearing from the so-called experts. Does no one have an ounce of principle anymore? Ron Paul’s op-ed on CNN.com was right on as always.  Paul predicted this 5 years ago. Of course no one was listening, because the average “Joe” has been manipulated by the media to the extent that he believes big government is normal. Joe comes to expect that Sam will rescue him whenever things begin to get a little uncomfortable for him. Of course Big Wall Street Rich Man has come to believe it too. They all get in line to get what Sam has to offer. The problem is, Sam doesn’t have anything to offer. But Sam has a big ol’ printing press.

Here’s a link to a video of Ron Paul lecturing Bernanke about the the limited authority the Fed has.

Oh, the “experts” will try to reassure you that this really isn’t a bailout, the government is simply buying these securities (which ones we don’t know yet, that’s how subjective this proposed bill is) at a decent price and then just holding them until the market realizes their true value and buys them back. Why not let the market do it’s magic right now? Well, that might be a little painful to those Wall Street Execs that have their golden parachutes vested in those failing companies. We wouldn’t want that to happen now would we?  The legislators writing this piece of trash even have the audacity to put language in the proposed bill that would prevent their actions from being exposed to any kind of scrutiny.

Sec. 8. Review.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

The other day, I wrote about the bailout of AIG as being a thinly veiled attempt to nationalize our financial industry. I was met with skepticism as to whether that was truly the motive behind the government’s actions. I don’t know whether it is or not, but at the very least it sets a very dangerous precedent. It is so far removed from the authority the constitution grants the Federal Government that it borders on the ridiculous. But no one seems to even be paying any attention to that. The media is so beholden to their government benefactors that they turn a blind eye to anything rational and truthful it seems. Faux Snooze included.

Thank goodness we have this medium to get the truth out to those who are still willing to seek it. However, according to some, there is the danger of the internet being regulated also. But that’s a topic for another post.

According to Ron Paul, only about 15 percent of Americans have any concern at all about the constitution. That worries me. You may not like to talk “politics” with people you associate with daily, but you can certainly pass on facts that are relevent to today’s news. Forward relevant emails, read Mises and Rothbard and Paul and educate yourself beyond what the media gives you in easily digestible sound bites. That’s the beauty of the internet, all the information is out there, you just have to read it. Lew Rockwell’s site is a treasure trove of good information if you’re interested in reading the truth about politics and economics.

This issue goes much deeper than simply bailing out failing financial institutions. How the government reacts to this issue will ultimately set a precedent for the future. And that doesn’t look pretty if it continues to go the way it has been. Call your senators and congress persons and tell them to vote a big resounding NO to any more government intervention in private markets. Let the market do it’s thing. Will it be painful? Probably. But swallowing the bitter medicine today is much better than letting the disease fester until the body withers and dies.