Fed up with the Fed
Okay, actually it's Paulson, who is Treasury, but I couldn't resist a good headline like that!
I was perusing blogs today, only to learn a couple terrifying facts about the proposed bailout.
1. $700 billion is a number the Treasury picked at random.
2. There are tons of better things we could do with the money.
- $180 billion would repair America's bridges
- $185 billion would fix the nation's rail system
- $150 billion would set each American up with private health insurance
Anyone else notice how we're still not at $700 billion yet?
Of course, the article doesn't say whether the insurance is perpetual or for one-year. But even assuming a single year cost $150 billion, that's just over 4 years' coverage.
This talk is all a little moot, since the Republicans walked out of negotiations tonight. (And you know the world has gone screwy when I start agreeing with the Republicans' concerns!)
But the proposal the Dems worked out was relatively more reasonable (compared to the random $700 billion being requested): $250 billion now, with a potential $100 billion more if Paulson can demonstrate it's necessary.
Still, it's placing a lot of undue stress on the taxpayers for businesses' mistakes. And this alleged urgent need is still kind of hard to see. I know people are still being foreclosed on. But how sure are we that throwing money into corporations will mean those same companies create better mortgages? (And isn't that just enabling/rewarding the people who got in over their heads?)
It seems to me like the free market, though in distress, is taking pretty good care of itself when push comes to shove. Everyone speculated that the government was going to bail out Washington Mutual. When that didn't happen, JP Morgan Chase took over.
Wednesday, Warren Buffett shoved a bunch of money into Goldman Sachs -- netting himself some great terms, but still keeping the company afloat. And there's talk that Goldman Sachs may use the capital to prop up other businesses.
So if the government is so edgy, maybe it can make a plan and keep it in abeyance. Then it's ready if things fall apart.
I'm wondering, though, if maybe the opportunism that got most businesses into this mess (greed to take everyone up on the subprime) will also get them out of it (other businesses will swoop in and buy them up when they're down).
Regardless of how this plays out, I think there is no longer any excuse for every American to have health care. Politicos carp about the cost. But they seem to generally agree to spend more than that on private enterprises.
Wouldn't health care have a better effect on the average taxpayer's bottom line? Think about it:
If every American had private health insurance
- Businesses would no longer have to shoulder the cost of employee health plans. This would free up more capital, which could mean fewer layoffs and maybe even raises.
- Employees wouldn't have to contribute to their own premiums through work. That would free up at least $100 a month for most insured Americans. This money could go toward debt.
- The standard of living would go up, as poor people didn't put off seeing doctors and actually got treated when conditions were still minor and non-life threatening.
- The government would save a ton on Medicare/Medicaid.
I think, in all, this would have a much bigger, more direct effect on the average citizen than to throw some money at banks and rely on the good ole' Trickle Down Theory.