Just thought of this. What if in the late 1800's the federal government bailed out the the railway industry.
Oh wait! They did. They bought the whole kit and created AmTrack!
What good did that do? It kept a few people in jobs and stagnated the railway industry. Which enabled other nations who weren't limited to "status quo" to create new high speed trains (look at Japan and the EU for example). Now all of the sudden, we need it: why? Because air travel costs too much money, that's why. A 200 to 300 MPH train makes sense, especially for sprints between nearby cities. (Like SF and LA).
What about if the feds had bailed out IBM in the fifties? We'd all still be running mainframes. What if the feds bailed out Digital Equipment in the eighties? We'd still be running minis.
In each of those cases, bailouts would have stagnated development because it would discourage competition and innovation.
Forgive me for using the tech industry. I'm sure there are many non-tech examples.
It is necessary for companies who cannot cope to go out of business, to step aside for other industries to spring up. Sure, the change is difficult for those of us who cannot stand to have their cheese moved, but it must be this way if we are to progress, to become more efficient.
Someone actually proposed in an article that print media should be bailed out. Sheesh is that ridiculous. Imagine how that would stagnate media innovation.
This is why the motor companies should sink or swim on their own merits. This is why the banks should be allowed to croak. Protect people's assets as much as possible but allow the companies to learn from their mistakes. Or in the case of the those that go out of business, allow the employees to learn from their mistakes.
One thing that bothers me, and I'm not 100% sure this is true, but I believe it is based on what I've heard on NPR and read in the news. Wells Fargo was very thrifty with its loans and is financially sound, even with all the foreclosures because of their conservative practices. Instead of being rewarded for their frugality and level-headed-ness, they are effectively being punished for not making mistakes. They watch as other banks are floated by the government, while they are forced to take money they don't want and are then told they can't celebrate their good fortunes in Las Vegas because it looks bad to appear like they are spending tax payer money on celebrations. They didn't want the money in the first place. They were smart and would have been king of the hill, if the government hadn't screwed with the freedom of the market place to try and prevent "disaster."
Disaster. Honestly, we need that once in a while to tame our egos. It must come. It must. Because if we don't have the negative feedback, then we will make worse and worse mistakes. Sooner or later we must learn
Mark my words folks, we haven't averted this "disaster." We've merely delayed it and when it finally equalizes, its going to be worse. We must accept our comeuppance sooner or later. Better sooner in my opinion.
On a side note: the federal government has told farmers in CA's central valley that they can't have any federal water. That means (unless they change it, which is likely because of the rains over the last week) 300,000 acres will be feral this summer. Food will be more expensive and harder to get. I'm not saying it will be an emergency, but it will be a lot like gasoline last summer.
Causes Brian McKee Supports
I support the cause of peace via peaceful means.