Friday, September 26, 2008

House Republican Plan: Bizzaro World Capitalism

Talk about the bizzaro backwards world of the House Republican's idea of free market capitalism.

Here is the basics of the Republican bailout plan: instead of buying assets from institutions and getting an equity stake in exchange for any premiums, the government would simply write insurance on toxic mortgages, then pay insurance claims as those assets go bust.

So instead of having the government *invest* the 700 billion - with the possibility that taxpayers might make some money (or lose some money) on their investment - the Republicans want the government to just pay out the 700 billion in insurance claims as the banking system blows up. So we'd just let the economy slowly go down the crapper and throw 700 billion of taxpayer money after it.

Huh? How is this conservative? How is this free enterprise? Oh, because the government wouldn't "own" anything.

Under the Paulson-Dodd compromise plan, the government would be acting like a homeowner or someone with an IRA, putting money to work in the markets, taking risk but getting reward if the risk pays off.

Under the Republican plan, the government is acting like a castrated nanny state, paying out insurance claims, unable to do anything but watch assets go bust, and gaining nothing in return.

Under the guise of ideological "free market" purity, Republicans want to create the biggest nanny state deal ever created. Are their heads screwed on backwards?

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