I opine

Socialization of Wall Street

Posted in Uncategorized by jaeminuf on September 16, 2008

For the past decade, much brouhaha has been made of privatizing social security, formally known as the federal Old-Age, Survivors, and Disability Insurance (OASDI) program. That private individuals will better manage their own retirement funds than the federal government can. That it doesn’t perform as well as private pension funds do. That, all in all, it is in the best interest of the individual to invest directly into the financial markets than to turn over that money for the government to safekeep until due time.

The present Bush administration has been a strong proponent of the privatization of social security. In general, they extol the virtues of the free market. That deregulation can only be a good thing.

Fast forward to September 2008

Treasury chief Paulson unveils historic government takeover of twin mortgage buyers. Top executives are out. – U.S. seizes Fannie and FreddieCNN.com


A.I.G., The New York Times

Acting to avert a possible financial crisis worldwide, the Federal Reserve reversed course on Tuesday and agreed to an $85 billion bailout that would give the government an ownership stake in troubled insurance giant American International Group. – Fed to Loan A.I.G. $85 Billion in RescueThe New York Times

I’m really confused…

Didn’t the current administration tout the superiority of the free market? Of the privatization of the federal insurance program for the old, the tired, the poor, the unemployed because – thanks to free market dictates that necessitate corporations to take a global view of production – jobs have gone to parts of the world with cheapter, better labor force? Of the virtues of privatizing the education system? And I thought, maybe I was mistaken, they were against big government? Against the socialization of various private sectors, such as the health insurance industry? Against bailing out people who knowingly got themselves into bankruptcies with unsound fiscal practices?

And I thought Wall Street wanted government to keep its hands out of private pockets…

So confusing… I could have sworn they really seemed to abhor the idea of a socialized state. Maybe I got it all wrong and they really do want a socialist state. Maybe they thought the proposed steps to move towards universal healthcare weren’t sufficiently radical enough.

I am sure of one thing. I’m so glad that, when I renewed my car insurance last month, I didn’t go with A.I.G. as the carrier. Or maybe I should have… After all, their tagline is “The Strength To Be There.” And other than the People’s Republic of China, who else would be stronger than the U.S. Government with its almighty dollar!!

Well, my carrier of choice is a part of Bank of America, so if it’s better for the government to be my insurance carrier, I’m sure sooner or later we’ll find that it too is not sufficiently capitalized, especially after buying Countrywide in July. But no worries since the US government will step in to bail it out. After all, once it acquires Merrill, Bank of America will be too big for the government to let fail…


2 Responses

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  1. Hans said, on September 16, 2008 at 7:23 pm

    you are not the only one confused! I am about to lose it when I think of everything going down currently starting back with Bear Stearns and then one domino after the other. It is so bad now, that they cannot even wait to hide it with a Friday “news dump,” two this week already and it is only Tuesday evening.

    Tie this together with McCain gaining in the polls and I am completely flabbergasted at the mere thought of “what are people actually thinking about?!” Based on the last election, this means there are at least 50 million Americans that a) either have their heads so far up the a$$es of Bush and the Religious Right or b) they are just too stupid to actually put 1 & 1 together to realize that 2 exists!

    Dumbfounded and extremely pissed off is the best description of what is going on in my head now! I’m going to have to seek Political & Religious Asylum in Russia the way things are going currently!

  2. echo said, on September 16, 2008 at 7:53 pm

    I know. All too sadly.

    I think an unfortunately large number of people are terrified and don’t think Obama/Biden will be able to protect them, especially since the latter are the ones actively campaigning for change.

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