From the Patriot Post, a compendium of quotes regarding the current credit & mortgage crisis, and the bailout being debated.  Quite a number of different takes on it, looking at it from different aspects. 

(By the way, the Patriot Post can come to your inbox 3 times a week.  It’s a good read.)

“Financial institutions are not being bailed out as a favor to them or their stockholders. In fact, stockholders have come out worse off after some bailouts. The real point is to avoid a major contraction of credit that could cause major downturns in output and employment, ruining millions of people, far beyond the financial institutions involved. If it was just a question of the financial institutions themselves, they could be left to sink or swim. But it is not.” —Thomas Sowell

“The credit crunch and foreclosure problems are failures of government policy. In fact, what we see now is a market correction to foolhardy government policy. Congress’ move to bail out lenders and borrowers who made poor decisions will simply create incentives for people to make unwise decisions in the future.” —Walter Williams

“[A]s lawmakers debate buying up hundreds of billions in assets, they should realize that the government’s aggressive meddling in financial decision-making is what got our economy into this mess in the first place. The long-term answer isn’t more federal control, it’s a return to free-market principles.” —Ed Feulner

“Crisis is the friend of the State. The politicians are desperate to be seen as ‘showing leadership,’ so we’re surely in for a new round of government interventions.” —John Stossel

“When the Forbidden Fruit was handed to Adam and Eve, they were allowed the moral choice to accept or decline. I know people who have refused to feast on the money tree. They live simply, within their means, and seem far more content than those who are trying to horde their wealth while clinging to the ladder of ‘success,’ terrified to let go. That isn’t real living. The Puritans rightly saw that as covetousness.” —Cal Thomas

…in a single two-panel cartoon at Red Planet Cartoons.  The problem seems to stem from folks defaulting on home loans.  It’s easy to label the lending institution "greedy" and go from there, but there’s a whole lot more to it than that.  One big-government program has spawned this new big-government bailout. 

Those with short attention spans will miss the larger picture.  The larger picture is the more important one.

…by Francis Cianfrocca, aka "Blackhedd", at Redstate.  His explanation of the situation that the Fed found themselves in with regard to AIG is, for the most part, readable by a non-financier. 

He also addresses the anger some are feeling about the government bailing out another huge firm, and against the top brass of that company.  In addition, he touches on how this affects free-market capitalists and the eggshells the government is now walking on in this regard.

A good read.

From Bruce McQuain at Q&O, comes a quiz:

1.  Who identified and tried to fix what presently ails Freddie Mac and Fannie Mae 5 years ago?

2.  Who opposed the plan, saying they were not in any kind of financial crisis?

McQuain gives a hint as to what the answer to #2 is; the same folks who say Social Security is just fine, and Medicare is doing well, too.  Bruce has a link to a contemporaneous New York Times article that explains the proposal and the smack down. 

Remember this when Dem…er, certain politicians try to place blame for this and try to use it as a campaign gimmick.

I was going to put a blog post together on this issue, but Dan Spencer at Redstate has done so, and with links to keep you busy for quite some time.

Among his list of things Palin has done on the earmark front, and contrasted with Obama:

• She ordered her administration to cut the number of earmarks (including the "Bridge to Nowhere").
• He consistently supported said bridge, even refusing to redirect funds for it to Katrina victims.
• She significantly reduced the number and dollar value of earmarks to the state of Alaska.
• She vetoed nearly $500 million in government spending over 2 years
• He has requested nearly $1 billion in earmarks over 3 years.

We need a President who understands that you don’t make citizens prosperous by making Washington richer, and you don’t lift an economic downturn by imposing one of the largest tax increases in American history.  Now our opponents tell you not to worry about their tax increases.  They tell you they are not going to tax your family.  No, they’re just going to tax "businesses"! So unless you buy something from a "business", like groceries or clothes or gasoline … or unless you get a paycheck from a big or a small "business", don’t worry … it’s not going to affect you.  They say they are not going to take any water out of your side of the bucket, just the "other" side of the bucket! That’s their idea of tax reform.

Fred Thompson, Republican National Convention, September 2, 2008

Poverty, as Glenn Beck notes, is an issue that unites us all, at least on the surface.  It’s not a political condition, he says; it’s a human condition. 

According to the U.S. Census Bureau, nearly a third of the residents in those cities [Detroit, Michigan and Buffalo, New York] are living beneath the poverty line, the highest rates among large cities in the entire country.

No matter what side of the political aisle you’re on, that is nothing short of appalling. Yet if you ask people what we should do about it, you’ll probably hear answers that inexplicably break down right along party lines.

Indeed.  Instead, we should see what works and do it.  Additionally, we should see what doesn’t work and stop doing it.  I mean, if providing the same solution for decades hasn’t helped, it’s time for a radically different answer. 

But as Glenn observes, there are some places that will stick with their solution through thick and thin (and failure).

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I’m currently on vacation in Ithaca, NY. My dad’s father, my dad, his 2 brothers, and a whole host of family in-laws and friends have purchases homes here and retired to the beautiful central New York region. Ithaca is home to Cornell University and Ithaca College, and over the years students from those schools essentially paid for the homes while they rented them during the school year. We would take our 3 weeks vacation here every year to mow the lawn (5 feet high by summer; students don’t typically mow lawns) and see our cousins. Because the brothers and their sister tried to coordinate vacations, we got to know our first cousins very well, as well as some second cousins and others of various once-removed or twice-removed situations.

Ithaca lives up to the stereotype of a very liberal college town, politically speaking. Obama will carry this town with greater than 95% of the vote. For a very long time, large, “big box” stores — Wal-Mart, Kohl’s, Home Depot, for examples — were kept out of town so as not to ruin the local town charm. The problem was, suburbs just outside the town were quite accepting of these stores, and they saw their tax revenues jump as the stores came in, while Ithaca found itself in a bit of a crisis. Money came in to the town, but it flowed out to the mall just on the other side of the town line or in burgs 20-30 minutes away. In the end, the “CAVE” people (liberal folks who were labeled “Citizens Against Virtually Everything”) had to relent to the fiscal realities. Ithaca now has a thriving shopping area for those that want the big stores, and after 5 or so years it still has The Commons where you can stroll around to find that corner bookstore.

What the CAVE people were worried about didn’t really happen, or at least not nearly to the extent that they predicted. The Meadow Court and the Grayhaven motels, longtime residents of Ithaca, have survived the introduction of the Hampton Inn chain. The Grayhaven caters to dog owners, one of the ways they stay competitive; defining their market. The local Wicks Lumber, which has a small hardware store attached, is still in business, even with Home Depot less than 2 miles away. The “mom & pop” establishments are essentially still here. The free market didn’t kill them off, and the CAVE people have grudgingly accepted it. (Well, some were simply out-voted. Acceptance isn’t always a given.)

In the end, capitalism worked. People got more choices, and the existing businesses survived, either by defining their markets, trading on their nostalgic or hometown quality, or enjoying customer loyalty going back decades. In Ithaca, both kinds of consumers — for the large and small businesses — exist, and businesses of both types can exist, side-by-side, in a capitalist society.

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If America falls into recession, Democrats will blame Bush, no doubt.  But does Dubya’s influence on the economy cover the entire continent of Europe?  Retroactively?

A mood of fear and pessimism is starting to descend on Europe. It now seems the region could head into recession even before the United States.

Many EU nations are in real trouble. In Spain, economy minister Pedro Solbes declared that the country was facing its "most complex crisis ever" following a collapse of the property market.

A leading Spanish property group, Martinsa-Fadesa, filed for bankruptcy earlier this week.

Like Spain, Ireland has suffered a housing market collapse and many people have run up huge personal debts. The Irish economy shrank earlier in the year and economists say that if it continues to contract, the nation will fall into recession by the end of 2008.

Despite this, the Irish Prime Minister or Taoiseach, Brian Cowen, has insisted his country is still doing remarkably well, despite the global economic downturn, and has rejected claims that he is personally responsible for the downturn.

Denmark is already in recession and shows no sign of emerging from it in the near future. The government there stepped in to rescue a failing bank, Roskilde, in early July.

Unlike the US economy, which still grew (albeit very weakly) in the first quarter, European countries are already in different degrees of economic retreat.  And the emphasis above (mine) notes that this is a global economic problem which we are weathering better than the countries Democrats keep holding up as examples we should follow.

Is Bush that all-powerful?  (Hint: No.)  But it’s just too good a glop of mud to sling at him for Democrats.  They just can’t pass up the chance, and they hope their followers aren’t paying attention. 

Technorati Tags: economics, recession, Spain, Ireland, Denmark

(Dan Trabue, frequent commenter on "Stones Cry Out", the group blog I run, in a comment here to my previous post on health care, referenced a think tank paper that predicts cost reductions without a loss of effectiveness with a single-payer system, and took issue with my terming this "socialized medicine".  I decided to put my response up as a post.)

From the Wikipedia entry on health care in Canada: "Health care in Canada is funded and delivered through a publicly funded health care system, with most services provided by private entities."  So in Canada, it’s not government-run hospitals but it is a government funded system.  While the writer of this Wikipedia entry insists it’s not truly socialized medicine, the article at the link to the words "socialized medicine" does concede, "The term can refer to any system of medical care that is publicly financed, government administered, or both", I suppose depending on who you ask.

But who’s in charge of the hospitals or what you want to call it is immaterial, as the outcome is the same.  Britain has government-owned hospitals and Canada doesn’t, but the result is still that bureaucracies make medical decisions instead of doctors and patients.  HMOs were the Left’s bogeyman for years, but their solution is to institute the nation’s, perhaps the world’s, largest HMO/insurance company to make our individual health care decisions.  This makes no sense at all.

From the think tank paper cited:

[The Lewin Group, "a nationally respected nonpartisan
consulting firm"] estimates the proposal would cover 99.6 percent of all Americans without raising total national health spending. It would also save hundreds of billions over time – more than $1 trillion over the next 10 years – in national health spending, according to Lewin.

The Lewin Group is inexplicably closing its eyes to the Canadian system, blue-skying his prediction.  The Canadian system uses both government- and employer-based payment system, utilizing private insurance/doctors/hospitals, and they are in crisis.  They are not saving money (Claude Castonguay, quoted in the original post, notes that rationing and "injecting massive amounts of new money" has not helped).  They most certainly do not serve effectively (Wikipedia cites a study showing 57% of Canadians wait 4 or more week to see a specialist).  And it unfortunately affects everyone (read the Wikipedia article sections titled "Government Involvement" and "Private Sector").

Are you really going to believe predictions on the efficiency and cost effectiveness of a massive government program.  No government program of such a size ever comes in under budget; not Medicare, not Social Security, not the Iraq War, nothing. 

The Lewin Group says that the government could bargain for lower costs, and yet Canada’s are skyrocketing.  They may have gone down at the beginning, but as The Acton Institute’s Dr. Donald Condit notes:

Resource consumption increases when people think someone else is shouldering the cost. Nobel Laureate Milton Friedman observed, “Nobody spends somebody else’s money as carefully as he spends his own.” More than 60 years of “someone else” paying for health care has led to medical expense inflation. Our predominately third-party reimbursement “system,” beginning after World War II for employees and after Medicare in 1965 for the retired, has resulted in out-of-control spending. Increasing the role of government will spur unbridled medical services consumption and further harm the underserved. Medical resources are limited. An expanded government role in health care will necessarily lead to rationing, shortages of health-care providers, delay in treatment, and deterioration in quality of care.

Medicaid is a socialized medicine microcosm. In that system, price controls and bureaucracy result in rationing by deterring provider participation and delaying treatment, with subsequent deterioration in quality of care. Affluent individuals are able to access better health care outside of any government system.

And this "Medicare model" is what the EPI plan wants to take the "best elements" of, which they only enumerate later on as the federal government administering it.  How can the Left possibly say they care more for the less-fortunate in one breath, and in the other hold up health care rationing as "caring"?  This makes no sense at all.

Canada’s system currently compares favorably to the US in terms of a couple of cherry-picked statistics, but that’s like judging a pyramid scheme based on the first few generations.  They are losing on other fronts, like a drain of doctors.  And they are now at the tipping point of that pyramid scheme, where the choice is either returning a bigger role to the private sector (what Castonguay called "radical" and what conservatives call "sensible") or sliding further down the slope to socialism.  The Left, not wishing to have their utopian vision challenged, will no doubt push for the latter.

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