The Ultimate Hostile Takeover

Posted by Larry Miller on June 17, 2009 under Why | Be the First to Comment

Some interesting news coming through the usual sources tells us that the Obama administration is drawing up plans to take over any company whose failure would represent a substantial hazard to the US economy. White House spokesperson Austan Goolsbee contends that there are companies that have become such a part of the economic infrastructure that their failure could bring down the entire system. One might look at this as an argument for less of the hyped interdependence promoted shamelessly by our “leaders”. It would be an outstanding reason to build some firewalls into the system.

The misguided arrogance of this plan is overwhelming. First because of the economic track record of our government in having any idea of what will happen down the road and second because of their supposed ability to fix such problems, should they actually exist.

We have seen the accuracy with which they predicted and fixed the the mortgage meltdown. They consistently reassured us that Fannie Mae and Freddie Mac were doing just fine until one fine day it all changed and we, the taxpayers needed to give them billions of our, or our grand children’s money. They kept driving down the standards for giving loans, then were astounded when these loans blew up in our collective faces. To be fair, this is not because of their lack of economic understanding. Their actions supporting the mortgage industry were based on give-away politics rather than than any kind of economic expertise. There were goals that needed to be attained that reached far beyond and around the good of the regular citizens.

It is precisely for this reason… that there are considerations other than the good of John Q. Public… that this is to be a recipe for disaster. We are looking at people who live in a world of lobbyists, back room deals and often outright dishonesty. They want to be the ones to determine which private companies should be snatched from their owners grasp without their consent. It’s like eminent domain on steroids. We have already seen where some major financial organizations were allowed to go under, some were forced to be absorbed by favored competitors, and yet others were deemed too big to fail and received boatloads of taxpayer dollars. The logic of the selections often exceeded the capacity of mere mortals to comprehend.

For those of us with a healthy distrust of positing too much power in any one unaccountable location, it gives us pause to wonder if we have any chance of an honest evaluation… even if we were to believe such a plan had merit – if we thought the government should be in the business of nullifying existing economic realities and creating new ones.

If we can get past our doubts about the ability of our government to make such determinations and the propriety of them going about attempting to tweak and twist our economic system, we end up looking at Washington’s ability to actually fix the problems.

We would find the fixes subject to the same impediments as the identification process. We have seen this in the stimulus spending where so much of it is not scheduled to take place until several years down the road, and only expands bureaucracies… not much use to the people currently hurting from the current economic reversals. Our Washington masters insist on pushing pet projects that often just don’t make sense outside the scope of the political system.

To make matters worse, the unaudited, unaccountable, private Federal Reserve is set right in the middle of the entire process playing a major regulatory role. This private bank, which itself should be regulated is being granted even more authority to fiddle with the controls of our economy. During their long and murky history, they have done their best to keep inflation low for the benefit of their member banks, but have done little for the American people… and they are now being given more keys to the kingdom. One has to wonder when the insanity will end. Where is Susan Powter when we need her?

We can write this off as just one more intrusion into our lives, or we can fight it. Some of our representatives who understandably grow weary from the constant battles tell us that we need to pick our fights. However we cannot forget that every assault on our freedom is an opportunity to stop the march to fascism and every time they succeed, they grow stronger and the fight becomes more difficult and more critical.