“As the mortgage crisis unfolded it soon became clear that a different Bush was in charge. As late as the spring of 2008, only the Bear “hedge funds” and a bunch of mortgage originators had been all;owed to die. No institution with any prestige or political clout went under. Even Countrywide was saved by Bank of America, using cheap, laundered cash from Uncle Sam. The government had neither seized and shuttered any banks nor taken any responsibility for determining if the banks were actually solvent. Governments not only here but throughout the world remained utterly passive except for one thing- they all agreed to hand out cheap cash to the banks that had created the problem.”
“To blame a mere shortage of cash for the evils caused by incompetence and corruption is the favorite lie of socialists and crony capitalists everywhere. Socialists always say that there is no problem of inequality or poverty that can’t be solved with cash. It is cash alone that separates the rich from the poor- not talent or skill or hard work or thrift. Similarly in the socialist view it is access to capital that separates “greedy” and “monopolistic” (read “successful”) firms from the thousand flowers that would bloom if only the government would create a “level playing field” and “enforce competition.”
“After the socialists become the government and begin evolving into crony capitalists, their favored beneficiaries – Soviet state-owned factories, Japanese banks, Fannie and Freddie in the United States- are always described as faultlessly devoted, idealistic, and hardworking, or at least essential. If they underperform (and they always underperform), it is only because they are short of cash- which the government always provides in some form or another.”
From Panic- The Betrayal of Capitalism by Wall Street and Washington by Andrew Redleaf and Richard Vigilante
Recent Comments