Sometimes there is not a yes and not answer to polls. The current poll “Do you think taxpayers should have to bailout the banking industry?”
With the options of a yes and no, leaves a lot out. We need not make a knee jerk decision.
Banking is the backbone of almost everyone in the United States. I just don’t see how financial transaction could occur without them.
How many individuals could survive the sudden call in of our mortgages, car loans, home improvement loans and credit card loans?
Many individuals would have to liquidate assets in bargain basement sales to meet the debt or to find a new lender or gain time to liquidate the equity in assets. Retirement funds with their early withdrawal tax penalties would be the sacrificed cow for many individuals. And then there would be many individuals that would just lose the asset they have financed and gain the financial and legal cost created by repossession.
I would not like to see the employees be unemployed, insurance policyholders to all at once be without insurance, business and personal mortgages to be called in and the country to go into a depression, because the snowball effect of failures of a few companies like AIG that could not find financing to stay in business. We all saw the affect of Enron, when only investors and employees were the biggest losers.
So we taxpayers loan AIG money at 11% interest, as long as it is paid back and the corporation survives, everyone wins. We taxpayers did this successfully before with Chrysler.
We need some protection and oversight for this investment however.
We do not willingly go into the finance business. All salaries and compensation of board members and officers must be tied to success of corporation to repay taxpayers and return to higher liquid assets.
I hate to see our corporations become foreign owned as in the case of Lehman Brothers sell to British owned Barclays. But, at least the taxpayers are not being hit with another bailout and the British are a democrat country.
The Communist country of China is trying to advantage of financial institutions crisis and desired to “help bail us out” by buying up some of the debt. Surely American Taxpayers would prefer our direct involvement in a bail out to the sell to a communist country.
To bail out the likes of an Enron, I say no.
To bail out the likes of AIG (Fannie Mae and Freddie Mac), I say yes. So my answer to the poll would be maybe, if I had that option.
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