"Why are House Democrats so eager to give away taxpayer money without considering these alternatives -- such as the Republican insurance proposal that eventually made it into the bill, but the Republicans voted down anyway?"
Of the possible alternatives offered, the republican insurance proposal got significantly worse economist reviews than the bailout, ranking only slightly above the views on doing nothing and letting the industry tank. The bailout was a bad plan, the insurance proposal was worse.
"Why are House Republicans against the bailout proposal (which only rewards financial firms for bad behavior), but also oppose judicial rewrites of predatory loan terms that will stem the foreclosures that caused this crisis in the first place?"
This is one heck of a good question. The answer is that House Republicans are sticking tenaciously to free (read unregulated) market principles which, many argue, are what got us here in the first place. Their arguments are becoming more and more ridiculous by the day and they are losing some serious points in the opinion polls over this and other clearly failed or failing stances they are taking. Perhaps this is precisely the solution we will end up with. Curiously, the firms would be required to write down the value of the assets before they could sell them to the government in the buyout. This exact same effect could be achieved by renegotiating the terms of the mortgages in the first place. The question is how long will it take to get there. But we don't want to tie the hands of our wise financial executives or reign in the free market which has served so well to stabilize our economy.
I've given some answers, but they aren't all satisfactory and the ones I haven't answered are definitely still outstanding issues to be addressed.
My one real question to the Republicans is that Keynes and every economist after him has believed that while lassez faire economics work in general, there are very obvious moments when they fail. So why do we still cling to the vain hope that it will right itself on it's own? I think it has as much to do with the economically uneducated populous (from both sides of the aisle) who still believes the market will just fix itself in all cases if we let it.
The Republicans need to budge on this, and the Dems have to stick to their guns. It is completely ridiculous that they will not stand by the mortgage refinancing provision. Any other solution is incredibly short-term. This thing can't have legs without it. If they don't insist now, they won't have any leverage later.
They MIGHT be able to wait until after the election, but by then it might be too late. How many more people are going to default in the next four months with interest rates rising and driving up ARM rates...?
Of the possible alternatives offered, the republican insurance proposal got significantly worse economist reviews than the bailout, ranking only slightly above the views on doing nothing and letting the industry tank. The bailout was a bad plan, the insurance proposal was worse.
"Why are House Republicans against the bailout proposal (which only rewards financial firms for bad behavior), but also oppose judicial rewrites of predatory loan terms that will stem the foreclosures that caused this crisis in the first place?"
This is one heck of a good question. The answer is that House Republicans are sticking tenaciously to free (read unregulated) market principles which, many argue, are what got us here in the first place. Their arguments are becoming more and more ridiculous by the day and they are losing some serious points in the opinion polls over this and other clearly failed or failing stances they are taking. Perhaps this is precisely the solution we will end up with. Curiously, the firms would be required to write down the value of the assets before they could sell them to the government in the buyout. This exact same effect could be achieved by renegotiating the terms of the mortgages in the first place. The question is how long will it take to get there. But we don't want to tie the hands of our wise financial executives or reign in the free market which has served so well to stabilize our economy.
I've given some answers, but they aren't all satisfactory and the ones I haven't answered are definitely still outstanding issues to be addressed.
My one real question to the Republicans is that Keynes and every economist after him has believed that while lassez faire economics work in general, there are very obvious moments when they fail. So why do we still cling to the vain hope that it will right itself on it's own? I think it has as much to do with the economically uneducated populous (from both sides of the aisle) who still believes the market will just fix itself in all cases if we let it.
Meep
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They MIGHT be able to wait until after the election, but by then it might be too late. How many more people are going to default in the next four months with interest rates rising and driving up ARM rates...?
~Sean
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