the voice of humility is too modest to claim to have called the meltdown over six years ago. In truth, it wasn't a prediction with precision. Rather a general pronouncement on the progression of government action,
The Iron Law of government: Everything eventually reduces to its absurd. If this is an actual law of physics that exists in nature is not known. In politics and government, it cannot be denied. Whereas in business a company can go bankrupt (unless it is publicly favored), in the realm of government, if (actually, when is more appropriate) a program attains absolute failure, it becomes a candidate for increased funding (e.g. DARE,).
This was first posted in our Short Dictionary of Politics in the old Spintech and reposted here.
Now there are some people who blame deregulation for all of our problems. Were there a few rules that were loosened so the high financiers could go to town? Possibly, if not probably. There were certainly rules like Community Reinvestment that denied reality. I knew when I heard ads for no doc mortgages that this could not end well, as the saying goes.
So what if a few regulations were let go. No one in our nation can say, "You know what, I'm getting scared we are in danger of a regulation shortage." If the current crisis doesn't get us, we've got a trillion dollar war, social security, medicaid, medicare. Sooner or later the denouement.
So I would take my chances and not support this bailout. You need other reasons?
1. Nobody can prove it will work.
2. It has all the flavor of a late night commercial,"Act now, before this valuable offer disappears forever!!!!!!"
3. The people who will most benefit are the people who screwed up.
4. Almost nobody in congress voting on it will understand what they are voting on.
Are those good reasons for opposing the bailout? Don't know. I am willing to change my mind if Messrs. Bernanke and Paulson are willing to bet all the assets they own against all I own that the plan will solve the problem for good.
Update: Commenter Gavin Andresen referenced an article by Tyler Cowen, Too Few Regulations? No, Just Ineffective Ones. As suspected, there was no dearth of regulations, but "with a growing loss of accountability and effectiveness."