Seething with incoherent monetary rage.

[DrEast]

NEW YORK (CNNMoney.com) -- The federal government is reportedly on the verge of taking over crumbling insurer American International Group in an $85 billion deal that could leave the company in the Federal Reserve's hands.

According to published reports late Tuesday, officials decided they must act lest the nation's largest insurer file bankruptcy. Such a move would roil world markets since AIG (AIG, Fortune 500) has $1.1 trillion in assets and 74 million clients in 130 countries.



That's MY MONEY you're diluting to purchase a share in this failure of epic proportions, you incompetent political HACKS.

And by failure, I mean the monetary system we're using these days that allow things like this to happen, not the poor people running AIG who just had the foolishness to believe conventional wisdom. They're going to get enough of a crudstorm as it is.

[Mozzes]

I wonder if this could form the foundation of an argument for why it's a bad idea for such a large slice of the pie to belong to one person.

[DrEast]

It's as if, instead of letting the stock market crash on Black Thursday, the government had bought it lock, stock, and barrel, and then taxed everyone 23.6% of their income, regardless of what that was, to cover it. Inflation is a much more elegant method of wealth redistribution. It's also brutal to the poor and elderly and the problem is still systemic!

[acyckowski]

It seems to me that politicians subscribe to the theory that a puppy chasing its own tail is DOING SOMETHING, and fail to grasp the point that the dumb dog isn't accomplishing anything.

Many large companies have survived bankruptcies, and the markets kept rolling along, why do they insist on screwing with these? Oh, that's right....they're doing such a bang-up job with public education and the department of motor vehicles, why not take over the financial sector?





acyckowski added to this post, 4 minutes and 14 seconds later...

....and so now they're pledging an $85M "loan" to prolong the misery. Oy, veh.

[DrEast]

....and so now they're pledging an $85M "loan" to prolong the misery. Oy, veh.

You had a typo there. It's $85B. How does the Fed even HAVE $85B? That's a little under a hundredth of the national debt!

Oh... that's right. It prints our money. Silly me!

[acyckowski]

My bad....only three factors of ten off, though. Pretty close.

[DrEast]

Eh, I'd made the exact same mistake when correcting yours.

[Krazy P]

That's MY MONEY you're diluting to purchase a share in this failure of epic proportions, you incompetent political HACKS.

And by failure, I mean the monetary system we're using these days that allow things like this to happen, not the poor people running AIG who just had the foolishness to believe conventional wisdom. They're going to get enough of a crudstorm as it is.

Oh my God! This is the biggest pile of shit I have every seen. The fed does NOT have the authority to bail out an insurance company. This is not in their charter. This is an amazing abrogation of power. Stunning, really.

So, if I get this right, our economic system is in such dire straights that in the last year, the Fed has had to intervene multiple times, in an unprecedented manner to avoid the vagaries of the free market from... what?

No public debate, no discussion. Decisions made and reversed by a handful of individuals in the matter of a few hours. Decisions affecting millions of people and billions of dollars.

My take is that these oh so smart people have no faith in the free market but ever so much faith in their own amazing genius. These beneficent and kindly sages have to tinker and "save us" from the evil wolf outside our door. Meantime, their machinations are making things much worse.

This is just amazing. I am almost at a loss for words.

[Tocsin]

The federal reserve bank was created to protect the banking interests, not the public. They are doing what they were created (in their own purposes) to do - to try and protect the wealthy from losing wealth no matter how bad their decisions were or how disastrous the results are.

Once the fed was created, it ceased being "our money" and became theirs, and the only people that matter to the fed are the people that run it - the people of wealth.

The rest of us will be screwed, in order for them to remain "comfortable" beyond our wildest dreams.

These actions, and these results, are the natural and logical results unregulated "free market" ownership society in practice.

In a society where the "owners" live in great comfort off of the interest made from the "workers-producers," while the workers-producers struggle to get by, it should come as no surprise that the amount of wealth skimmed off to non-productive ends eventually grows to the point where it cannot be sustained, and the system begins to collapse.

[DrEast]

The federal reserve bank was created to protect the banking interests, not the public. They are doing what they were created (in their own purposes) to do - to try and protect the wealthy from losing wealth no matter how bad their decisions were or how disastrous the results are.

Once the fed was created, it ceased being "our money" and became theirs, and the only people that matter to the fed are the people that run it - the people of wealth.

The rest of us will be screwed, in order for them to remain "comfortable" beyond our wildest dreams.

These actions, and these results, are the natural and logical results unregulated "free market" ownership society in practice.

In a society where the "owners" live in great comfort off of the interest made from the "workers-producers," while the workers-producers struggle to get by, it should come as no surprise that the amount of wealth skimmed off to non-productive ends eventually grows to the point where it cannot be sustained, and the system begins to collapse.

Your first three paragraphs were dead on. The last two devolved into some sort of pseudo-Marxist strangeness.

Government regulation CREATED the federal reserve. It was fraud by sleight of law. It was retarded. The free market had absolutely nothing to do with it... the federal reserve is the single most powerful state control over the market system we have. It was a way to enslave the markets from conception, and it was excessively unconstitutional to boot. So leave the "free market" out of this one... regulation is not the answer. Dismantling the banking system is the answer.

To put it another way... you want to solve government abuse by giving the government more power? I see government as a tool of powerful people and would like to shrink that tool as much as possible, to its minimum responsibilities.

[Tocsin]

To put it another way... you want to solve government abuse by giving the government more power? I see government as a tool of powerful people and would like to shrink that tool as much as possible, to its minimum responsibilities.

In a free market, the natural inclination for people who are successful is to leverage their power, wealth, and influence to gain more power, wealth and influence; therefore the most likely result of interaction without public regulation is that a few people will come to exercise much more influence than the rest, and that they will use that influence for their own benefit - and generally to the detriment of others.

The creation of the federal reserve is not an example of the evils of public government, it is an example of the corruption of public government into an agency serving private - not public - interests.

In the end, the only means the general public has to collectively insure that they are not abused by small but powerful private concerns is through the agency we call government.

The problem is that when people allow their government to become a remote system, with little public oversight, the people who operate it will eventually become, or be replaced by, people willing to trade the public trust for their own personal advantage.

I don't want to "solve government abuse by giving the government more power," I want to solve private abuse by giving the public more power - and using that power to restrain private abuse.

[DrEast]

In a free market, the natural inclination for people who are successful is to leverage their power, wealth, and influence to gain more power, wealth and influence; therefore the most likely result of interaction without public regulation is that a few people will come to exercise much more influence than the rest, and that they will use that influence for their own benefit - and generally to the detriment of others.


To a degree, yes. But you're missing the next step... overreaching their power, the powerful fail and fall hard. That's true in any conceivable system... true totalitarianism is just not possible in the human condition. Powerful men can't cheat death, and for every powerful man exists another who perceives him as an enemy.


The creation of the federal reserve is not an example of the evils of public government, it is an example of the corruption of public government into an agency serving private - not public - interests.


Fair enough, and a point I'll grant you. Government as an agent of evil is sloppy thinking, but government without corruption is simply impossible.


In the end, the only means the general public has to collectively insure that they are not abused by small but powerful private concerns is through the agency we call government.


This, on the other hand, is a point that I will have to argue against in two ways, by counterexample and from historical analysis in our own country.

By counterexample, a lynch mob is a non-governmental way to ensure that abuse is not exercised. So are private militias, assassinations, and various and sundry other non-governmental reprisal methods.

Historically, the American Revolution was fought against two agencies... the King of England, certainly, but also against the powerful private concerns that held great sway in that government. The Boston Tea Party wasn't directed at the King, but at the powerful shipping companies that, like the oil companies of today, utilized the government for private gain. A similar modern way to express the same sentiment would be to bomb oil refineries. Of course, the King of England saw that as an act of terrorism... as would the U.S. government today.


The problem is that when people allow their government to become a remote system, with little public oversight, the people who operate it will eventually become, or be replaced by, people willing to trade the public trust for their own personal advantage.

I don't want to "solve government abuse by giving the government more power," I want to solve private abuse by giving the public more power - and using that power to restrain private abuse.

Then the first step is to kick everyone currently in Congress out and dismantle the two-party system. Further, dismantling the Federal Reserve, a private concern that acts just like a government agency, is also a pretty crucial step. Concentration of power in one agency's hands, be it a person, a politic or a party, is simply too dangerous when fallible humans are at the helm.

[Tocsin]

But you're missing the next step... overreaching their power, the powerful fail and fall hard.

This is essentially the period in the cycle of an empire that we in the United States are just entering - the failure and collapse of the corrupt regime.

Imperial overreach and blowback in regard to foreign/military affairs is resulting in The United States loss of favor all around the globe.

In economic affairs, The United States devolution - from a manufacturing society that generates wealth by producing real goods into a financial services economy which tries to generate profit from interest earned on the good produced by others - is finally beginning to run its course, and the issuing of more and more paper currency without real wealth to back it up devalues that currency.

If it reaches a point where loss of faith in the American dollar reaches the same lack of faith that citizens in the Soviet Union had in the Ruble, then we could similarly see the emergence of "black market" and alternative economies as well as the collapse of national institutions of government.

...government without corruption is simply impossible.

If such is the case, then there may be little hope for the human race in the long run.

But even though government completely devoid of any corruption may be an unattainable goal, a popular democratic government capable of sufficiently reigning in private excess, and weeding out most of the people in government who succumb to it, does appear to be an attainable goal, considering the success of several modern European democratic socialist nations.

One key to such strategies is the level of democratic representation, which I will save for discussion at another time.

...a lynch mob is a non-governmental way to ensure that abuse is not exercised. So are private militias, assassinations, and various and sundry other non-governmental reprisal methods.

Popular uprising against corrupt regimes is indeed a valid means for defeating oppressive private interests which have grown too powerful and abusive. The founding fathers of the United States recognized the right and necessity of such an option being preserved for the people and embodied such ideals in our Declaration of Independence.

(For those who might have forgotten)
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

In essence, public revolution IS public government - at its most basic level. It is the people themselves reasserting their right to restrain excessive power and to prevent their own abuse, and to return the rightful exercise of power to themselves.

It is possible that it may even come to that again in the United States... time will certainly tell.


Then the first step is to kick everyone currently in Congress out and dismantle the two-party system. Further, dismantling the Federal Reserve, a private concern that acts just like a government agency, is also a pretty crucial step. Concentration of power in one agency's hands, be it a person, a politic or a party, is simply too dangerous when fallible humans are at the helm.

There are many things that we can (and should) do to reform our form of governance, including some of the things you have suggested.

Putting in all of the things that could be considered to reform our government, and our society, is a little more than I would want to try to get into this one post, so I will put if off for now, but hope that we continue to have much further discussion of needed changes to this nation somewhere on this forum.

[DrEast]

I do so enjoy a forum where you an actually have reasonable discourse.


If such is the case, then there may be little hope for the human race in the long run.


This is actually a central tenant of my theology. I won't go into any more depth here, theological discussions having already taken over the philosophy forum, but I will say that it's downright axiomatic for me. That doesn't excuse abuse of governmental power, by any means, just indicates an inevitability.

It is, however, that inevitability which leads me to strenuously resist government control beyond very defined limits. To place one's hope in government for humanity's salvation is to misplace one's hope. In a here-and-now sense, you and I may agree on much; for a long-term view of the future, my belief in the fundamental and total depravity of man will mean that you and I will diverge quickly in the best way to build a secure society.

Democratic oversight alone is not a sufficient answer. See Calhoun's "Disquisition on Government" for a very well-formulated (and time-proven) argument to that effect.

[Tocsin]

Democratic oversight alone is not a sufficient answer. See Calhoun's "Disquisition on Government" for a very well-formulated (and time-proven) argument to that effect.

Thank you for the reference. For anyone else interested, there appears to be an online text version here (To view links or images in this forum your post count must be 2 or greater. You currently have 0 posts.). I don't know if it is the complete text of the work in question.

In any case, there is more than can be read in only a few minutes, but gleaning what I could from the first dozen or so paragraphs, it seems that he is building a case based on the conflict between the competitive impulses of individuals vs. the cooperative impulses of people.

This certainly gets to the heart of human social interaction, and the nature of government.

If people are driven primarily by selfish impulses to compete to gain personal advantage, then the only type of government we can hope for is that of the oppressive big brother - a powerful entity needed to hold a club above the head of the individual to intimidate them into NOT acting out of their primal nature to take, swindle, or steal whatever they want from others.

I do not subscribe to that vision of humanity. Although it is a possibility, and even a likely probability (if ignorance and selfishness are the societal norm), there are other views of human nature that I prefer to accept, and hope for.

It is the ideal of the enlightened man; of a people educated enough to see the benefit of acting cooperatively rather than competitively, of a people who are mature enough to recognize not only when they have enough for themselves, but capable of recognizing the dangerous implications of the idiom "you can never have too much of a good thing."

Although such examples of human enlightenment have never existed in a distinctly pure form, I am still optimistic and idealistic enough to envision the possibility of a society in which people are educated and wise enough to see past acting purely out of personal ambition and gain, and willing to restrain their own desires in exchange for the potential rewards that can be achieved by acting in concert with others, rather than in competition with them.

[Avid]

Kevin G. Hall in the McClatchy Newspapers writes:
Why would the government bail out a company like AIG but let Lehman Brothers file for Chapter 11 bankruptcy protection?
Kevin answer: Speaking frankly, the world can do without another investment firm. If an investment bank fails, any remaining investment bank can hire more people and take their jobs. AIG is not an investment bank. As a principal insurer, it insures consumers, it insures businesses and it insures business ventures, so it's not just that your corner store needs insurance.
The best analogy I've been able to come up with is to use an automaker. When you think about putting an automaker out of business, you put tire makers out of business, you put seat makers out of business, you put all sorts of things out of business. It's the same thing with AIG. There are tentacles. They're just so connected to so many other parts of the economy that the government deemed it more dangerous and potentially more expensive to the economy to have it fail than to give them this loan.

Story of Stuff answer: Lehman will not affect shopping, AIG will!

Number of employees AIG = 116,00, Number of employees Lehman = 25,000
The Bank for International Settlements recently reported that total derivatives trades exceeded one quadrillion dollars – that’s 1,000 trillion dollars, cost of bailout 85 billion. I found that somewhere. I'm getting so overwhelmed trying to lay out all that is happening and how it affects everyone.....