Bailing Out Wallstreet And The Rich

[WinePusher]

I hear a lot of liberals, progressives, socialist, occupy wallstreet protestors complaining about things like income inequality and how the top 1% is screwing over everybody else. Well, it's funny how these very same people seem to have no problem with government programs such as TARP and government institutions like the Federal Reserve bailing out wallstreet firms and executives.

In fact, it seems like the majority of people on the left supported government intervention because all these banks were too big to fail.

1) Isn't it ironic for the left to support the government bailout for wallstreet since they're constantly complain about wallstreet?

2) Was it a good idea for Congress and the Federal Reserve to bailout out wallstreet? Has the wallstreet bailout helped the economy recover?

[Furrowed Brow]

Back in 2007-8 I'm was a centre lefty and did not support the bail out of Wall Street or British Banks. But to be honest I don't think I fully understood what was going on. A deficiency I have since put considerable time and effort into correcting. With this research I have found myself driven ever more to the left to the point it is fair to say I sit somewhere on the radical left. Education is a great thing init. At the time I vaguely recognised that if some action was not taken we were likely to see an economic and social collapse of an order that would have been much more frightening. It is difficult to not offer support even it is tacit if there is a gun held to your head.

I'm not sure what is the liberal left you are referring to, but in the UK there has been pretty much a subdued conversation on the subject. Sure there are grumbles but for the most part folk lack a coherent way to express those grumbles. I suspect this is mainly due to economic illiteracy and the lack of a framework in which to understand what went on, and the media failing to inform and the petering out of Occupy.

I think the bail out has not helped the US economy to recover, it did stop it collapsing. And I think the reason it rolled that way is the cosy plutocracy and self interest of the political and financial elite, combined with a real fear that I guess envisioned something like what Greece looks like right now or worse.

I understand that if quantitative easing is stripped out of the US GDP figures ( as it is included) the US has actually seen something like a 20% contraction. (I may be a bit out on that percentage so please challenge me). The reason all the money printing has not resulted in hyper inflation is that the US (along with much of the rest of the world) is suffering serious deflationary forces.

On the margins there is a recognition that QE is only helping the richer classes.

I suspect the answer to your question is that many of those of who you are critical feel they need to dogmatically support Obama and/or they don't really understand the implications of what went on. Which is a way of saying there are likely folk (liberal and tea party) who are still pretty much close to being economically illiterate. but yes I agree there are those on the liberal left who are guilty in this respect.

[Goat]

Back in 2007-8 I'm was a centre lefty and did not support the bail out of Wall Street or British Banks. But to be honest I don't think I fully understood what was going on. A deficiency I have since put considerable time and effort into correcting. With this research I have found myself driven ever more to the left to the point it is fair to say I sit somewhere on the radical left. Education is a great thing init. At the time I vaguely recognised that if some action was not taken we were likely to see an economic and social collapse of an order that would have been much more frightening. It is difficult to not offer support even it is tacit if there is a gun held to your head.

I'm not sure what is the liberal left you are referring to, but in the UK there has been pretty much a subdued conversation on the subject. Sure there are grumbles but for the most part folk lack a coherent way to express those grumbles. I suspect this is mainly due to economic illiteracy and the lack of a framework in which to understand what went on, and the media failing to inform and the petering out of Occupy.

I think the bail out has not helped the US economy to recover, it did stop it collapsing. And I think the reason it rolled that way is the cosy plutocracy and self interest of the political and financial elite, combined with a real fear that I guess envisioned something like what Greece looks like right now or worse.

I understand that if quantitative easing is stripped out of the US GDP figures ( as it is included) the US has actually seen something like a 20% contraction. (I may be a bit out on that percentage so please challenge me). The reason all the money printing has not resulted in hyper inflation is that the US (along with much of the rest of the world) is suffering serious deflationary forces.

On the margins there is a recognition that QE is only helping the richer classes.

I suspect the answer to your question is that many of those of who you are critical feel they need to dogmatically support Obama and/or they don't really understand the implications of what went on. Which is a way of saying there are likely folk (liberal and tea party) who are still pretty much close to being economically illiterate. but yes I agree there are those on the liberal left who are guilty in this respect.

One of the main things most people are forgetting is that Obama did not sign the wall street bailouts.. Bush did. It was the The Emergency Economic Stabilization Act of 2008 , and was signed by George Bush in October of 2008. What Obama did was extend it to the automotive industry, which also, unfortunately , was needed at the time.

We need to reinstate glass-stegal, so banking is boring again, and banks are not doing risky behavior with Other People's Money.

[micatala]

I hear a lot of liberals, progressives, socialist, occupy wallstreet protestors complaining about things like income inequality and how the top 1% is screwing over everybody else. Well, it's funny how these very same people seem to have no problem with government programs such as TARP and government institutions like the Federal Reserve bailing out wallstreet firms and executives.

In fact, it seems like the majority of people on the left supported government intervention because all these banks were too big to fail.

1) Isn't it ironic for the left to support the government bailout for wallstreet since they're constantly complain about wallstreet?

I am not sure a majority of ordinary people on the left really thought this was a good idea. I do think the politicians on the left felt like they had no choice but to do a bail out or watch the economy entirely implode. I think they went into that for the most part knowing it was a 'devil's bargain.'

I don't fault those who promoted and enacted the bailout with thinking it needed to be done. I do think they did not do enough to prevent abuses, or take steps to avoid the situation in the future. Concentration of wealth in the top banks is now worse than it was prior to 2008.

2) Was it a good idea for Congress and the Federal Reserve to bailout out wallstreet? Has the wallstreet bailout helped the economy recover?

I guess I answered this already. I think we had to do it. I think it kept the economy from imploding. I think it was not enacted as well as it could have been, and I think the follow up regulations were not as strong as they should have been.

[chris_brown207]

I hear a lot of liberals, progressives, socialist, occupy wallstreet protestors complaining about things like income inequality and how the top 1% is screwing over everybody else. Well, it's funny how these very same people seem to have no problem with government programs such as TARP and government institutions like the Federal Reserve bailing out wallstreet firms and executives.

In fact, it seems like the majority of people on the left supported government intervention because all these banks were too big to fail.

1) Isn't it ironic for the left to support the government bailout for wallstreet since they're constantly complain about wallstreet?

Ironic? No, I don't think ironic, because I don't think you can find many liberals that actually "supported" the bailouts. Rather, I think most people who chose it did so as they felt is was the lesser of two evils. I was not one of those. I actually voted for the other guy, because for a second there it looked like he was going to allow banks to fail. However, at the end, both candidates voted to continue TARP.

2) Was it a good idea for Congress and the Federal Reserve to bailout out wallstreet? Has the wallstreet bailout helped the economy recover?

I don't think it was a good idea. I think it just ensured the same thing would happen again later. I also think that it extended out the pain, although made it less sharp over the short term.

[Nickman]

I hear a lot of liberals, progressives, socialist, occupy wallstreet protestors complaining about things like income inequality and how the top 1% is screwing over everybody else. Well, it's funny how these very same people seem to have no problem with government programs such as TARP and government institutions like the Federal Reserve bailing out wallstreet firms and executives.

In fact, it seems like the majority of people on the left supported government intervention because all these banks were too big to fail.

1) Isn't it ironic for the left to support the government bailout for wallstreet since they're constantly complain about wallstreet?

2) Was it a good idea for Congress and the Federal Reserve to bailout out wallstreet? Has the wallstreet bailout helped the economy recover?

It is a damn good thing that 172 Dems and 91 Repubs voted for the bailout, because it kept us afloat. It is funny how Repubs don't care about corporate subsidies, but they are not in favor of a bailout.

[help3434]

[Replying to post 1 by WinePusher]

Giving money with no strings attached to some of the same companies that help cause the problem in the first place was a dumb move I think.

[WinePusher]

Ironic? No, I don't think ironic, because I don't think you can find many liberals that actually "supported" the bailouts.

Fair enough. But just for consideration, about 49% of the occupy wallstreet protestors supported the wallstreet bailout while nearly every single free market libertarian I know of opposed it. I doubt there is any libertarian out there who actually supported the bailout.

Rather, I think most people who chose it did so as they felt is was the lesser of two evils.

Fair enough. But, I think the main point is that the criticisms being made by the occupy crowd are completely off base. They are all criticizing Capitalism for the wrong reasons. Under a purely Capitalistic system all of these banks would have failed and gone bankrupt. These investors, brokers and bank executives all made incredibly stupid mistakes and decisions and they would have paid the price for it had it not been for government intervention.

These occupy protestors shouldn't be up in arms about the way wallstreet is run. They should instead direct their 'anger' at the government for enabling wallstreet's stupidity.

[WinePusher]

I understand that if quantitative easing is stripped out of the US GDP figures ( as it is included) the US has actually seen something like a 20% contraction. (I may be a bit out on that percentage so please challenge me). The reason all the money printing has not resulted in hyper inflation is that the US (along with much of the rest of the world) is suffering serious deflationary forces.

I agree. If the federal reserve were to stop quantitative easing and allow interest rates to rise the economy would probably plummet again. I haven't looked at this in detail, but I think Britain's central bank (along with the other central banks of the world) is pursuing the same policy of money printing and it will end in disaster.

And what would these deflationary forces be? I think the reason we're not seeing hyperinflation is due to the fact that the economy and employment is shit. Inflation essentially represents an overheated economy with a lot of consumption and consumer demand. We are far from that, consumption is still relatively low in the economy, so businesses have no reason to increase their prices. But, the economy has become so dependent on the quantitative easing so I really doubt the economy will be able to survive on its own without the QE stimulus.

[bluethread]

I hear a lot of liberals, progressives, socialist, occupy wallstreet protestors complaining about things like income inequality and how the top 1% is screwing over everybody else. Well, it's funny how these very same people seem to have no problem with government programs such as TARP and government institutions like the Federal Reserve bailing out wallstreet firms and executives.

In fact, it seems like the majority of people on the left supported government intervention because all these banks were too big to fail.

1) Isn't it ironic for the left to support the government bailout for wallstreet since they're constantly complain about wallstreet?

2) Was it a good idea for Congress and the Federal Reserve to bailout out wallstreet? Has the wallstreet bailout helped the economy recover?

It is a damn good thing that 172 Dems and 91 Repubs voted for the bailout, because it kept us afloat. It is funny how Repubs don't care about corporate subsidies, but they are not in favor of a bailout.

That is the problem with the government doing things to effect the economy. Prior to the 1930's transfer payments were unconstitutional. Now they compose the majority of the federal budget. Corporate subsidies have been instated by people from both parties, generally as economic bailouts. Then those bailouts are not repealed or are extended, because someone somewhere will suffer. Therefore, there is no incentive to do anything but expand government spending. It was foretold some 150 years ago that a democracy can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship.