Bailout nation

Wednesday, November 19, 2008

By Judd Grossman

Jackson Hole, Wyo.-The Nanny State extended it’s entangling apron strings further into our economy with the current bailout frenzy. Government interference in the form of massive bailouts for the banks has rewarded failure. The very existence of that pile of bailout money has encouraged a stampede of other entities clamoring for a piece of the pie. Market forces will always rule, so if the government is handing out money as a reward for failure, ambitious people will pursue failure with vigor in order to partake of the windfall.

Fannie and Freddie f-up
If you’ve been listening to NPR at the exclusion of all other information sources, it’s important you realize the mortgage meltdown was caused by a number of different factors not just “deregulation,” because if you don’t have a complete picture of the cause you might support the wrong cure. In 1992, Congress and the Clinton administration passed legislation that directed Fannie Mae and Freddie Mac to meet specific target percentages of mortgage loans to low-income borrowers.

Politicians used Fannie and Freddie as a tool for social engineering, and a cash cow for pandering to special interests, all the while taking kickbacks in the form of campaign contributions. By making a market for these riskier loans, Fannie and Freddie, aided by Alan Greenspan’s artificially low interest rates, set the stage for a housing bubble of historic proportions. Unscrupulous lenders and greedy banking executives joined the fray, and a broad range of our society jumped in as well, looking to make a quick buck.

The argument can be made that the if the government broke it they should fix it, but I’m deeply concerned that more government intervention will only dig us deeper into the hole. If bailouts provide any short-term relief, those gains will likely be overshadowed by the long-term damage inflicted on our free market system, and by the capital devouring expansion of our national debt.

Dole in the Hole
“Abby Rowen shook her head stubbornly. ‘I’ll not take charity. I’d rather die first.’” - The Mystery of the Old Clock - Nancy Drew - 1930

I was reading Nancy Drew with my son, and it struck me as remarkable how far we’ve come since 1930, culturally. There was a time when people were too proud to take charity, when success was to be admired, pursued, accomplished - not doled out. Over the years, our political class has inflicted on us occasionally good intentioned, but often cynical, power grabs through socialistic public policy initiatives such as the New Deal, and The Great Society. These bold interventions have inhibited the moral and financial development of those who were targeted for help.

This culture of entitlement has permeated every level of society from fat cat bankers to Jackson Hole ski bums. (Around here those two titles can apply to the same person.) I was reading with much chagrin a recent Planet JH article [The Buzz: “The off-season dole,” Ben Cannon, Nov. 12] about seasonal workers who go on unemployment to make it through the off-season. Isn’t it great that money can just appear to help us avoid those little inconveniences like actually taking care of ourselves?

Jackson Hole’s self-righteously hedonistic recreation-junkie culture is like Peter Pan (“I’ll never grow up”), but not as cute. At some point, adults begin to realize that money comes from somebody earning it, and when a business is forced to dole out cash to folks who aren’t producing anything, there will be less money for expansion and job creation.

 I was also puzzled by a sappy article in the Jackson Hole News and Guide regarding the closing of the Alpinist magazine, and the financial woes of some of it’s employees. It sucks to lose your job, but the proper reaction should be one of determined self-reliance.

It seems that our middle and upper middle-classes are desperate to play the role of the victim. There are truly disabled folks who need our help, but for the rest of us, I would like to see a little bit of pride exhibited and valued in our society, not just in old bedtime stories. PJH


PERMALINK:
Bailout nation | Planet JH News Article: Right Wing Local

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