2008 Woodie Awards
Economic bail-out
Ted Trevorrow
Issue date: 9/29/08 Section: Op-Ed
If you haven't been watching the news, listening to the radio, or reading a newspaper lately, you may not have heard; apparently, the United States economy just jumped off a cliff.
Suddenly, all those banks, private investment firms and large mortgage companies stopped making boatloads of money and found out all that the money they were making wasn't really there. To put it another way, they kind of got a bit of their own medicine; ironically, just like the subprime mortgages they were selling to customers, the deals turned out to be too good to be true.
Now all those companies find themselves in one of three positions. Scenario one: they failed and either went bankrupt or were bought out. Scenario two: they are in big, big trouble and are worried they are about to become obsolete dinosaurs. Scenario three: they were the smart ones who either got out just in time to avoid the worst part of this mess, or never got too involved in subprime loans and are either buying the failing companies or trying to avoid getting touched by any of their toxic death. Unfortunately, for everyone involved at all with these companies, even the Scenario three crowd is saying everyone will be affected by their toxic death unless congress does something.
And by something, these companies mean give them money, a whole bunch of money, as in about 23 percent of our nation's total budget. Now, granted, this number is if you don't include discretionary spending (as if anything in this category is actually "discretionary"). By discretionary, we can be made to think of other endeavors like the Iraq war, special emergency spending like relief funds for natural disaster victims, and other 'discretions' like that. Including those numbers, the money the banks are asking for is roughly 20 percent of our nation's budget. Now that seems like a huge amount, but in reality it is little compared to the trillions in debt we have already essentially bought from when the government bailed out AIG, and assumed control of Fanny Mae and Freddy Mac over the last few weeks.
Suddenly, all those banks, private investment firms and large mortgage companies stopped making boatloads of money and found out all that the money they were making wasn't really there. To put it another way, they kind of got a bit of their own medicine; ironically, just like the subprime mortgages they were selling to customers, the deals turned out to be too good to be true.
Now all those companies find themselves in one of three positions. Scenario one: they failed and either went bankrupt or were bought out. Scenario two: they are in big, big trouble and are worried they are about to become obsolete dinosaurs. Scenario three: they were the smart ones who either got out just in time to avoid the worst part of this mess, or never got too involved in subprime loans and are either buying the failing companies or trying to avoid getting touched by any of their toxic death. Unfortunately, for everyone involved at all with these companies, even the Scenario three crowd is saying everyone will be affected by their toxic death unless congress does something.
And by something, these companies mean give them money, a whole bunch of money, as in about 23 percent of our nation's total budget. Now, granted, this number is if you don't include discretionary spending (as if anything in this category is actually "discretionary"). By discretionary, we can be made to think of other endeavors like the Iraq war, special emergency spending like relief funds for natural disaster victims, and other 'discretions' like that. Including those numbers, the money the banks are asking for is roughly 20 percent of our nation's budget. Now that seems like a huge amount, but in reality it is little compared to the trillions in debt we have already essentially bought from when the government bailed out AIG, and assumed control of Fanny Mae and Freddy Mac over the last few weeks.
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lou
posted 10/06/08 @ 9:45 AM EST
and where are we supposed to get the money for this, we are already living paycheck to paycheck, let them clean up their own mess!!!
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