Tuesday, November 25 2008 10 p.m.
Recently, you may have heard the term "Too Big to Fail" (TBF). TBF is simply a euphemism for well connected. The company or industry being spoken about is too well connected and has too many lobbyists. Notice how the financial sector and auto industry both get bailouts, but the realtors and the builders get nothing. The reason for this is that realtors and the construction industry don't have enough lobbyists making laws for them in congress. Too bad for them. Even worse for the rest of us since we've committed our kids to paying off a few trillion dollars in debt. AIG is too big to fail but your kid is little enough to saddle with hundreds of thousands of dollars in debt.
Isn't it interesting how the government is willing to recapitalize the banks to the tune of "whatever it takes" but they won't give money to the person being foreclosed? This would solve the same problem from the other side and cause less pain to the little guy. Alas, there is no little-guy lobby. The person getting foreclosed on is an afterthought. Of course, if they just gave money to whoever owned a home, some people would say this is unfair. And they would be correct. When you do it that way it's obvious that what we're doing is wrong. But, package it under the guise that we must "do something" and season in a little fear until the aroma of panic is in the air... and now we've got freshly baked socialism pie.
I am now on the record saying that "Too Big To Fail" is offensively stupid. Every single person who said it and weren't mocking it are "Too Stupid For Government Work".
Let's make a little mental list of everything that some people consider TBF. AIG, Citibank, the U.S. Federal Government, but not individual states! If any of those are actually TBF I suggest to you that they are actually TBE... "Too Big to Exist". We should not allow anything to be that big. We should write our rules so that we never again allow any entity be so large so as to destroy "everything" if it fails. Whenever we determine something is TBE we should figure out how to break it apart.
What can we do now? I would suggest a tax protest but I'm not sure if it's legal to suggest that. In the meantime, we just have to wait for the unintended consequences of these bailouts to set in.
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