Wholesome Reading » Blog Archive » From the Comments…

From the Comments…

From the comments on Idle Musings: The Inflection Point below:

Of course we are here talking about an amount of money equal to 0.1% of the total amount of bailout money given to AIG… Maybe smart people should spend some time thinking about and discussing nationalization schemes that would allow the government to recoup some of the money given to the banks instead of engaging in cheap (and rather boring) moralism.

It isn’t about moralism, it’s about being stunned at the hubris. This isn’t Oliver Twist asking for more gruel, it’s Oliver Twist asking for more gruel AND the keys to the car AND a change of underwear, and seemingly being unaware or uncaring of the appearance of the thing and its consequences to themselves, to those keeping them in business, and to the bailout in general. I think the President actually put it well today when he said, “I think Mr. Liddy and certainly everybody involve needs to understand that this isn’t just a matter of dollars and cents. It’s about our fundamental values. All across the country, there are people who are working hard and meet their responsibilities every day, without the benefit of government bailouts or multi-million dollar bonuses. We’ve got a bunch of small business people here struggling just to keep their credit lines open. They are going without pay…. In some cases, they are mortgaging their homes, doing a whole host of things just in order to keep things afloat. All they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules. That is an ethic we must demand.”

That’s what I’m on about, not the small change. And here’s the funny thing… Maybe at the root of this, moralism is what it’s all about.

This entry was posted on Monday, March 16th, 2009 at 3:55 pm and is filed under The Political Mindscape. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

8 Responses to “From the Comments…”

Rob Says:
March 16th, 2009 at 4:28 pm
So if the government didn’t bail out the company, would these people have received their bonuses? That should be the question, IMHO.

I think the administration should take a very hard line and negotiate with the banks/AIG before giving them money. If the company breaks the contract, screw ‘em. I don’t understand why they didn’t do this in the first place. Welfare recipients/Unemployment recipients have to jump through a bunch of hoops for hundreds/thousands of dollars, but those receiving millions/billions of dollars don’t?
geraldy Says:
March 16th, 2009 at 5:25 pm
I just wish that 1/10 of the outcry about the tiny amount of bonus money we’re talking about here was directed against Republican politicians like Phil Gramm, Fed Chair Alan Greenspan, and Rubin-style Democrats — that is, those who believed that this kind of stuff wouldn’t happen within radically de-regulated financial markets. These politicians (and the Americans who supported them) were living in a fantasy world.

Sure, the AIG Financial Products Division (along with Moody’s, the banks, etc.) gamed the system, but what we need to ask now is why the system was so easily gamed.

What the AIG executives did wasn’t illegal and, if one thinks that strictures from “business ethics” can carry the load within capitalist financial markets, then I can get that person a good deal on some very cheap Lehman Brothers stock.
Shaun P. Says:
March 16th, 2009 at 9:02 pm
geraldy, I think you’ve got a great point, but the problem is that Gramm, Comrade Greenspan, et al. are out of the spotlight - and AIG is very much in it. And most people, sadly, aren’t going to take the time - or have the time - the learn about the root causes of the problem, and direct their anger accordingly. Nonetheless, you’re right, the structure of the system has got to be changed. Just another thing that was twisted horribly wrong over the last 28 years. I wonder how different things would be for the AIG execs right now if shareholder lawsuits hadn’t essentially been gutted as a way of bringing about change in publicly-traded corporations (thanks, Reagan-appointed federal judges!).

Steven, there’s a definite populist and moralist twinge to the outcry over the craziness in the bailouts, and I think that’s a good thing. If we’re lucky, it will be what leads to the serious reforms, and re-regulations, that the system needs.
DanLong Says:
March 17th, 2009 at 12:27 pm
What bothers me most about the comments made is the blame pointed at Republicans; reagan, greenspan, and the like. Please keep in mind that Clinton was a huge supporter of deregulation of financial systems.

I do agree however in blaming Greenspan, though i don’t necessarily see the point in tying him to the republican party. The republican party itself wouldn’t have a specific opinion on the matters that Greenspan most affected, but rather that is in economic spirit; If anything you are saying republicans are more pure capitalists, while democrats weigh more in as socialists?

Greenspan’s idea that liquidity would solve all financial woes was clearly faulty. it was inherently errant in that liquidity DOES solve most problems, but the amount of leverage that comes with increased liquidity can cause tremendous losses when there no longer is a market for an instrument, and said instrument may no longer be sold.

The truth of the matter is that Obama’s administration is trying to solve the problem by the hair of the dog, so to speak. the heart of the crisis comes from accessibility to credit in order to increase liquidity, through the process of deregulation. giving these tremendous “loans”, equity stakes, and revolving credit agreements to big corporations are providing just the same; I can promise you 8 years from now we will look back and find that providing MORE easily accessible credit will NOT be what solved the crisis.

These bailouts were a problem from the beginning, even the first one that passed under the Bush administration. Nationalization of business and increased spending are the LAST things this nation under crisis needs. instead, the government should be focused on cutting the budget and keeping the dollar from a deval. Instead, we should take a page out of the Book of William J. McDonough, Fed NY-branch President in 1998, during the collapse of LTCM. Instead of bailing out the hedgefund, or taking any active involvement in the solution, he brought together (without Greenspan, mind you) the heads of the major players in wall street to confer and find a solution amongst them. Similar should have been done with AIG, Bear Stearns, Lehman brothers, and CitiGroup, instead of the collapse/bailouts. the companies that could not or would not merge, cancel debt, or find ways to hold each other over would simply be left to fend for themselves, and the bad businesses, those that overleveraged, overcapitalized, or overextended their venture into risky assets, would collapse.
om-g Says:
March 19th, 2009 at 12:18 pm
of course, now we know that the brouhaha over AIG was a diversionary tactic to keep people distracted while the Fed moved to conjure up a trillion dollars (and spend thirty percent of it on government debt).
Soylent Green is Sheeple Says:
March 21st, 2009 at 3:37 pm
it’s a little hard to work up much outrage over millions when the government is spending BILLIONS like a drunken sailor on a weekend binge in Bangkok.

any time timmy and the big B spent on AIG bonuses was an obvious waste of time that they should have spent coming up with something other than the latest tired attempt to have the American people overpay for shitty bank assets.
LW Says:
May 28th, 2009 at 5:00 pm
of course, now we know that the brouhaha over AIG was a diversionary tactic to keep people distracted while the Fed moved to conjure up a trillion dollars (and spend thirty percent of it on government debt).
Pehmer Says:
August 9th, 2011 at 12:16 pm
Great One…

I must say, its worth it! My link, http://anitas11.livejournal.com/,thanks haha…

From the Comments…

8 Responses to “From the Comments…”

Leave a Reply