Soviet Socialist Republic of Wall Street
ILLUSTRATED: To explain how we'd handle Wall Street, just make the sports analogy: you need referees to play the game. Sports are still exciting with records broken.
What a ten day stretch! We have a federal takeover of the secondary mortgage market (Fannie Mae and Freddie Mac) and now the Federal Reserve has an 80% stake in A.I.G., the global insurance and re-insurance giant. Well it took over 28 years, but George H.W. Bush is vindicated: Voodoo economics is now exposed as pooh pooh economics.
Points to get across:
-75 years ago, FDR was called a socialist with his banking reforms. What he did was set up capitalism to be self-sustaining.
-The key to reducing government's bad influence on markets is not necessarily cutting regulation, is it cutting the deficit. Then the government doesn't compete with business for borrowed capital. Bill Clinton and Robert Rubin understood that.
-Democrats set up a process to properly allocate resources throughout the economy. Sure on April 15 the rich a bit more in taxes, but it is an investment in a lower deficit,...which leads to lower interest rates (Wall Street's tax, or the price of money). So pay more out of pocket to Uncle Sam, and we stop swiping the national credit card. By running deficits, we either pay more in taxes eventually or higher interest rates.
What a ten day stretch! We have a federal takeover of the secondary mortgage market (Fannie Mae and Freddie Mac) and now the Federal Reserve has an 80% stake in A.I.G., the global insurance and re-insurance giant. Well it took over 28 years, but George H.W. Bush is vindicated: Voodoo economics is now exposed as pooh pooh economics.
Points to get across:
-75 years ago, FDR was called a socialist with his banking reforms. What he did was set up capitalism to be self-sustaining.
-The key to reducing government's bad influence on markets is not necessarily cutting regulation, is it cutting the deficit. Then the government doesn't compete with business for borrowed capital. Bill Clinton and Robert Rubin understood that.
-Democrats set up a process to properly allocate resources throughout the economy. Sure on April 15 the rich a bit more in taxes, but it is an investment in a lower deficit,...which leads to lower interest rates (Wall Street's tax, or the price of money). So pay more out of pocket to Uncle Sam, and we stop swiping the national credit card. By running deficits, we either pay more in taxes eventually or higher interest rates.
posted by Teka Thomas at 6:51 PM
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