- Joined
- Jan 2, 2006
- Messages
- 28,174
- Reaction score
- 14,270
- Location
- Boca
- Gender
- Male
- Political Leaning
- Independent
I believe the operative word there is "private" debt instead of taxpayer funded Federal Debt. In our economy there are consequences for poor choices and the problem is liberals want to bailout those people who make bad choices and therein lies the problem. Free enterprise operates on the basic principles of personal responsibility and individual wealth creation. If you take risk and succeed you are entitled to the "fruits of your labor" but if you take risk and fail there should be consequences for that failure.
I do not and never will support the bailouts of private business that fail thus I did not support TARP. I do not support the massive expansion of govt. under FDR and now Obama. Liberal social engineering by these two Administrations along with others has created the 13.4 trillion debt we have today. that debt is unsustainable.
Your argument is all over the place. First and foremost, Hoover and FDR allowed thousands of banks to fail following 1929. To eliminate bank failures spawned specifically from liquidity runs, the FDIC was created (and to a great success as there has yet to be another run on a US bank). Proper and necessary financial regulations were then put in place which (basically) disallowed a bank to operate (using deposits) as insurance companies (risk spreaders).
I will wholeheartedly agree that when a business implements a faulty strategy, it should pay the price (even if this equates to failure). For the sake of future confidence in any particular industry; spillover from a few faulty institutions cannot, should not cause responsible firms to fail. No single entity can pose systemic risk -it and of itself-, or else it will have a disastrous impact on long term risk taking (essential in a market system).
Had TARP not been passed, thousands of institutions would have failed (even the ones who "bet correctly" e.g. Goldman Sachs).
Had a proper stimulus been enacted (around $1.5 trillion focused primarily on infrastructure, health and education), current growth outlooks would not be as abysmal.