Washington's Intervention Addiction...Ron Paul
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Artist:
One problem with politicians is that when problems they create come to a head, they typically feel this irresistible urge to DO something, rather than to UN-do something, or to simply back off to avoid exacerbating the situation. Too often, that which they end up doing has very little connection to the cause of the crisis, but plays well in the press and superficially makes everyone feel better. Bills that are rushed through Congress under duress are never studied enough, providing too tempting an opportunity to quietly slip in unrelated provisions that erode freedoms in ways that would never pass as a stand-alone bill. We famously saw this with the PATRIOT Act, but Washington learned nothing from that.
The current housing crisis and the corresponding big government fix are another prime example. First of all, the so-called solution will actually make the problem worse. The problem stems from easy credit and a rush to flood the housing and mortgage markets with money. Relaxed or non-existent lending standards led many into mortgages and houses they could not afford. As more foreclosures hit, the lending institutions will continue collapsing like dominoes under the weight of all the bad paper they underwrote. Some are reacting and reintroducing lending standards. Thus the number of buyers in the market for homes is beginning to shrink back to its natural size, and hyper-inflated prices are falling back down to earth. In these ways, the market is trying to correct itself in the wake of the mistakes government intervention encouraged them to make through easy credit. However, this correction is causing pain, especially to Wall Street investors and those who bought homes at the top of the market bubble, never expecting it to crash, always assuming they would easily be able to refinance.
Some mistakenly identify the falling home prices as the disease instead of merely a symptom - which they plan to fix with more easy credit and more liquidity to push more unqualified buyers back into the market for homes they still cannot afford. This is akin to the drug addict identifying withdrawal symptoms as his problem and searching for another fix as his solution. The cycle continues and the problems compound themselves. The addiction deepens.
Addicts are told the first step to recovery is to admit their problem. To cure this addiction to intervention we have to honestly admit the problem and once and for all, kick the habit. That will involve some pain, without a doubt. There is no easy, painless solution to the mess the disastrous economic interventions of the past have wrought. The question is - do we allow some lending institutions to collapse, or do we allow the dollar to collapse? To extend the metaphor, do we endure the temporary discomfort of withdrawal, or do we continue on until there is a fatal overdose? We can delay the agony, but only for a little while, and then we will all end up paying the price for the mistakes of a few.
With the final passage of the Housing Bailout Bill quietly on a Saturday in the Senate, and the President's signature, our government has unfortunately chosen the latter…
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Comments (9)
I love this man . .. great read. too bad he's not in it for November, things could've really been different.
I'm writing his name in for my vote.
Not thinking about going for Bob Barr or some other third party?
Is he the Libertarian Candidate. Thought about voting for their candidate, but their a mix bunch. I'd have to checkout what their viewpoints are on each issue. I saw their presidential debate and remembering not agreeing with some of the issue's of some of them. They did talk about holding to a Ron Paul viewpoint. The only other parties I might consider is Independent, or American Independent. Thanks I'll checkout Bob Barr.
Just checked out Bob Barr, he's one to consider. I'd rather go with Ron Paul myself.
I would to, but in the absence of him actually running . . . Not that Barr has a chance, though. I can't say I agree 100% with everything he or the Libertarians are saying, but I figure I'm never going to find anything I do completely agree with. On the flipside, I at least like where the Libertarians are coming from, their whole philosophy concerning government.
I have to agree with you, on their whole philosophy concerning government.
How different would this be handled if it were the upper 1% with this problem. I am sure all resources would go to helping them
I kinda understand what the Govt. is doing. GWB once said that he wanted to treat the U.S. like a corporation. For one thing foreclosures equal more money for the government. They give corporate welfare to the big companies like the tobacco companies to help them out. I would say that's how they help the upper 1% that benefit them. From what hear there are less rich people today. One problem I think happening is that to many people are trying to give the appearance of being middle class/upper middle class and the Govt. uses that to their advantage. GWB encourages us to shop when the economy is doing horribly, then tells us we need to be more responsible with our money. I'll stop here, I can go on forever lol.