Re: [MLUG - DISCUSSION] why our economy is a mess

[Mike Miller <EMAIL:PROTECTED>]

On Mon, 3 Dec 2007, Brent Deterding wrote:

> On Dec 3, 2007, at 6:42 PM, Mike Miller wrote:
>
> > The government does not control greed (in the sense of preventing it), 
> > but it does control regulations.  The Republican attitude is that 
> > government regulation is bad and must be eliminated -- the free market 
> > can take care of itself.  Why not blame Democrats?  Well, when all this 
> > happened, the Republicans were in control of House, Senate and 
> > Executive, and this fits their M.O.!
> >
> > Greed is omnipresent and continually challenging.  We need regulations 
> > and enforcement to prevent greedy powerful people from destroying us.
>
> In all but the extreme cases of greed (read: monopolies) I think the 
> free market is the best approach. From my understanding of the matter 
> economic history supports this; government regulation tends to be "bad" 
> in many aspects (stifling innovation, eliminating freedom, associated 
> with traditional socialist and communist principles).

I'm sure that some kinds of regulations are bad, but we do have laws that 
regulate business and tax law is an important part of that.  I think that 
you will find some changes of policy underlying recent adverse events. 
When you see "financial innovation" it is probably because some recent 
policy change permitted new schemes (scams?) to flourish where they once 
were either illegal or unprofitable.


> I have mixed feelings on a bailout. On one hand there are cases were 
> (arguably) this has worked well to preserve a US industry. I'm 
> specifically thinking of big auto in the early 80s and Harley Davidson 
> around the same time. Note that in both of those cases the companies 
> benefiting from the bailout went back to the government and paid back 
> the loan or requested tariffs be lifted. However, out of principle I 
> think people need to live with the consequences of their actions. In the 
> two cases I reference it was relatively simple to bailout a handful of 
> companies, whereas here the answer of "who do we help" would be pretty 
> complicated!

I don't know what people are thinking about that issue.  Many banks are 
trying to do special things to keep people in their homes.  I'm sure we'll 
see lots of foreclosures though and I guess I don't feel too sorry for 
most of those people.  There was a lot of speculation, and when you 
speculate you accept the risk of losing.

Mike

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