Free Enterprise?
I don't get it. This is supposed to be a free enterprise system, yet it seems that if you are big enough and get into trouble the government will bail you out. Doesn't free enterprise mean you go into business and take your chances?
In taking over Fannie Mae and Freddie Mac - who coined such childish names? - one of the things mentioned is that otherwise stockholders might lose everything. Isn't that what investing in stocks is supposed to be all about? When things go up you profit, when they go down you lose, or so I thought. If I buy a lottery ticket and it isn't the winning number, will the government step in to see I don't lose my money? Fat chance.
The entire mortgage loan business is a fiasco. That's OK, the taxpayers will fix things up. Otherwise they couldn't continue business as usual.
Now the auto manufacturers want $50 billion in loans from the feds. Only the American companies because the foreign ones won't need it. They've been doing things the right way all along. So who bailed out Packard and Studebaker and Auburn and Stutz and all the other fine car makers that went under? Nobody - but Ford and General Motors and Chrysler, the ones now asking for $50 billion, did everything they could to hurry them into the grave.
The economists would say I just don't understand. They're right, I don't.
Or maybe I do get it. If you're a little guy, you're out there on your own. If you're big enough, Uncle Sam is always standing by to take care of you. Is that what they mean by a free enterprise system? Maybe someone should explain to me the difference between capitalism, socialism, communism and all the other isms. When things get tough they seem to be remarkably similar.
In taking over Fannie Mae and Freddie Mac - who coined such childish names? - one of the things mentioned is that otherwise stockholders might lose everything. Isn't that what investing in stocks is supposed to be all about? When things go up you profit, when they go down you lose, or so I thought. If I buy a lottery ticket and it isn't the winning number, will the government step in to see I don't lose my money? Fat chance.
The entire mortgage loan business is a fiasco. That's OK, the taxpayers will fix things up. Otherwise they couldn't continue business as usual.
Now the auto manufacturers want $50 billion in loans from the feds. Only the American companies because the foreign ones won't need it. They've been doing things the right way all along. So who bailed out Packard and Studebaker and Auburn and Stutz and all the other fine car makers that went under? Nobody - but Ford and General Motors and Chrysler, the ones now asking for $50 billion, did everything they could to hurry them into the grave.
The economists would say I just don't understand. They're right, I don't.
Or maybe I do get it. If you're a little guy, you're out there on your own. If you're big enough, Uncle Sam is always standing by to take care of you. Is that what they mean by a free enterprise system? Maybe someone should explain to me the difference between capitalism, socialism, communism and all the other isms. When things get tough they seem to be remarkably similar.
posted by Dick Stodghill | 9/07/2008 11:44:00 AM
1 Comments:
We used to call them "corporate welfare bums". CN, CP, Air Canada, Canadaire, the lot of them...may as well be govunmint run...they are certainly govunmint funded! Yearly bailouts became the norm.
Fortunately, small businesses are 80% of the economy, and because of the huge voting base of small business...they have made it comparatively easy to run a small business in Canada. (note...I DID say "comparatively", you can still count on half your time being spent either doing paperwork or working to pay the taxes.) When you get to be a bit bigger...say employing as many people as a city newspaper, then the paperwork burden becomes onerous, and there are NO bail outs and no fall back. Medium sized businesses go under pretty regularly. And being big won't necessarily protect you either. Zoom airlines declared bankrupcy last week, along with some pretty big airlines like Alitalia! When you become really big...well then...it helps to follow the money. Who pays for the campaign?
No guarantees in this world.
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