Re-Thinking Economics

(A great article to remind us of the pre Obama period and the current state of the economy.Editor)

By Nicolas C. Petraglia

After seeing that the bail out bill finally passed on October 3rd, I could not help but remember an article published that same week on the CNN website which read,

“In the span of just 11 days, the Bush administration and lawmakers, seeing ominous warnings in the credit markets, rushed to create legislation to prevent a potential economic meltdown. The result: A $700 billion bailout package that aims to get financial institutions lending again by letting the U.S. Treasury buy up their troubled assets, most of which are tied to the housing market crash.”

diary of the dead online

While it sounds great that people will once again be able to borrow from banks (at least in the US), that the economy will be back on its feet, and that there are some measures that supposedly protect taxpayers from actually paying this exuberant amount of money, there’s no guarantee that such will be the case since all the money to be regained is left at the mercy of what the market will end up dong in the future. Furthermore, it was exactly the lending irresponsibility (and the oversight of government), which led to the market crash and thus the bail out bill to occur – let alone be required.

What seems strange is that time after time governments continue to bail out banks for their losses when the economy goes downhill. Now, while it cannot be denied that the financial sector is of great importance to a society and that this sector provides hundreds and thousands of jobs around the world (directly and indirectly), it is their sense of irresponsibility that lead to this sort of quagmire. In 1776 economist Adam Smith made the following observation, which was just as valid then as it is now,

“It is the highest impertinence and presumption, therefore, in kings and ministers, to pretend to watch over the economy of private people, and to restrain their expense… They are themselves always, and without any exception, the greatest spendthrifts in the society. Let them look well after their own expense, and they may safely trust private people with theirs. If their own extravagance does not ruin the state, that of their subjects never will.” wisegal divx download

Thus if government so easily splurges money, what will stop not only the financial sector to do so, but also private citizens. Which leads to the questions of, why is it that when politicians and the financial sector screw up the common taxpayer ends up paying? Why is it that when they make money only their stockholders and them make money? Here the game of debts becoming public assets while gains become private assets, for anyone looking in, will simply seem completely unreal.

Is it possible then, that after years of helping one specific sector of society in their screw ups, that society might learn that trickle down economics (where a select few play with everyone’s money enjoy the benefits, and their crumbs – should there be any – feed the bottom) is simply not working. This kind of intervention for the elite did not do anything for long term stability in the 80s, 90s and considering the batting average of such measures is certain not to work, again. The market (and irresponsibility of few) cannot be left alone to dictate the whims of society’s destiny. At the end of the day this argument is based on the fact that the market acts and exists on its own (the invisible hand of A. Smith) as though human beings have no say, nor are they the controllers of the markets. This is not the Big Bang or Creationist Theory or Newton’s perception of the universe, where it happened and now humanity simply watches in awe. This bail out is humanity proving the exact opposite, that the market cannot exist on its own; that human intervention is valid and needed, and that it must be done so responsibly. However, the solution is not handing out cash to the very people that got the US markets (and consequently the world) in this place. Giving $700 billion to this sector of society is like giving a sharp knife, a noose, directions and keys to the top floor of the Empire State Building and an unlimited amount of painkillers (all at once) to an attempted suicide victim that was unsuccessful to begin with, with a gun.

To add salt to the wound, one cannot help but look at the irony found in the fact that this money is meant to give banks liquidity so that they can once again lend out money. What of the people that lost their homes, when they needed money, where was their government then? As well, why are they getting money to lend, when it was their “expert” decisions, which created this whole mess? Any person with any sort of reason, can understand that this seems like lending money to someone so that they can turn around and lend it back to you and on top of that have the nerve to charge you interests.

Until when is this nonsense going to continue? Until when will human beings allow for this to happen? Until when will human beings refuse to learn from their past mistakes? And until when will the world allow for so-called experts to give advice on that which they themselves don’t seem to understand? One would hope that the 21st century becomes the time in where humanity learns and not unlearn; in where human beings evolve and come to a consensus that enough is enough and decisions need to benefit everyone and not just simply a select few.

It is time to re-think economics and how it is done and even taught. From an early age, people have been taught that gain over everything is correct, and it is situations of this sort that reaffirm the belief that although there is something wrong with this concept no one seems to do anything about it. Society continues to amount astronomical debts to fund wars, bail out banks, and give tax cuts that only few people will truly reap the benefits from. Thus, to conclude, challenge the economic norm, question those that say that’s just the way things are and there’s nothing that can be done, and most importantly be critical starting with the words you have just read.

filth and wisdom free download