Friday, September 26, 2008

The Third Absolute Certainty In Life

There are only a couple absolute certainties in life. Death is one and taxes are the other. However I propose that there should be a third one to the list. Whenever congress gets together for a bit of bipartisan legislation like this $700 billion bailout, it is bad for you and me. We should tuck our money in mattresses and run with them screaming towards the hill. Bipartisan legislation is just a euphemism meaning everyone gets what they want and we the tax payers end up footing a bill so full of pork that it makes the Iowa State Fair look like a single hors d’oeuvre.

$700 billion is a lot of money. The current occupant of that big white house and the current occupants of the other big house with the gold dome toss it around so cavalierly. Let me put this in perspective. Let us pretend that you are in the U.S. mint and they tell you can keep every dollar bill that you initial. Let us for the sake of round numbers say you can initial a dollar bill in one second and you never have to take any breaks and won't get writer's cramp. It would take you 11.5 days to pocket your first million. It would take you almost 32 years to become a billionaire. In 717 years, you would pass Warren Buffett to become the richest person in the world assuming that he assets stayed the same between now and then. Finally in 8101 years, you would finally have $700 billion dollars in your name and due to inflation; it probably wouldn't even buy you a loaf of bread in the year 10109.

I fully expected that this would be a done deal by now and it hasn't. Evidently some people up on "the hill" have woken up and realized that we can't afford to spend $700 billion, the same as our national deficit for the entire last year, even if dire things will happen because we don't bail out these entities who made the bad loans. Almost no one is saying what would happen if this bailout didn't happen. Those that do talk about it do so in general terms like it would be bad. What bad actually means is left to the imagination. I guess since I saved for a rainy day and could survive with the economy much worse, I actually want to see what is over the abyss should the bailout not happen. But as I said in the beginning, this is bipartisan legislation so they are probably only fighting on who gets what, not what has been left out. We are certain to be fleeced over it. The only consolation would be to die before they had a chance to get it from me via taxes.


The Real Mother Hen said...

Ah don't get me going on this one. The Free market society has failed, and now the government has to "socialized" banks! Isn't it great? :)

The truth is - if they allow big corps to go Chapter 11, then pick up their assets later, the govt probably needs only 200 billion. Credit Crunch? No problem, set up another billion to deal with it. This way, you probably only need to spend 300 billion, instead of the 700 billion which would go no where. But of course, anxiety prevents them from doing that.

Another thing, where does this 700 billion come from? China and Saudi Arabia of course! Tax payers - nah, our tax will be increased just to cover the freaking interest rates! Tax payers alone can't save this nation, especially since the rich don't pay them :)

You've an Asian wife, hold on to her passport. And I'm not kidding.

R. Sherman said...

Unfortunately, what we're not told is why we're in this mess in the first place. That is, the Feds, with a big assist from Congress issued new regulations in the 1990's which pretty much mandated that lenders make these "subprime" loans. Now, when the chickens are coming home to roost, everybody's fleeing the scene of the crime and we're left to clean up the mess.


Murf said...

You should be proud of yourself for having a nest egg and being able to buy a minivan in cash but you shouldn't look down on those of us that would love to build up savings but can't currently and lump us with the ones that need all the newest gadgets and huge homes that they now can't afford.

Ed Abbey said...

Mother Hen - The dollar doesn't go as far as it used to in the Philippines either!

R. Sherman - ...and it certainly is a big mess to clean up.

Murf - I wasn't lumping anyone into a category. I hate being lumped so I try not to do it to others.

sage said...

this is a mess--I don't like the idea of $700 billion to bail out greedy folks--in fact, I'd prefer we start a public works projects and rebuilding things like roads and inter-city rail lines and sewage systems that create methane than doing this.

Beau said...

It is a mess; I thought they would have some sort of package together already. I don't like it either, but if we are to believe that it is necessary then they need to figure it out and get it passed. I don't want to see the abyss- too many would be hurt or left to struggle. It took almost a generation to move past the Great Depression, and some never recovered. I think we're better than that, and we can move forward.

Ed Abbey said...

Sage - I think the whole thing stinks. Perhaps this bill will produce some methane after all.

Beau - Yeah, I'm not sure I want to see the abyss either. It is easier to say it than to take the last few steps to peer over the edge.