The people of this country have a brain. Each one has one. Each one can make a right choice in everything, it just takes common sense and experience. Now let me define experience for you.
Experience- as a general concept comprises knowledge of or skill in or observation of something or some event gained through involvement in or exposure to that thing or
event.
So look at these questions:
Now the common person can gain experience if he or she fails in a task right? Yes.
Now when that common person fails does it affected the whole country? No.
Now when the government fails does it gain experience? Well looking how history repeats itself, my answer would be No.
When the government fails does it affect the whole country? Yes
The government believes it can fix any problem . So let me give an example. An Economist (an expert in the social science of economics) comes into the NYSE and sees the stocks are down . Now the economist has experience and study in this field. Then the Government steps in and acts like it knows what it's doing and decides to take over the show and attempts to fix the problem. Now the government decides to pump a couple trillion dollars in the economy thinking that it will fix the issue. However, the economist says did you ever hear of the " business cycle", " laissez-faire",? And the government just shoves off the Experienced person and just basically adds more wood to the fire.
The thing is ,that the people are educated more than the government in these sort of affairs and they know best.
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Victor, I think you are making this seem a little too cut and dry. All economists are not in agreement that the bailout is bad. For example, in January 28, 2009 200 economists were against the bailout, in February 8, 2009 200 economists were for the bailout. Some Nobel-prize winning economists do not think Obama has done enough, while others think that he should stop. Economists are in no way of one mind when discussing the effects of the bailout.
ReplyDeleteAs for the business cycle, there is some debate on whether or not it should be managed (most governments have tried to manage it since the 40's), whether it is a cycle or a random fluctuation, and whether or not it is possible to prevent it. With different economists disagreeing on what is true.
As for laissez-faire, there is much debate over how useful it is. For example, the Government allowed the Banks to do whatever the Banks wanted and a recession occurred. For that matter, one of the duties of the government is to protect its people (right?) the economic crash that occurred (if not for government intervention [opinion]) could has resulted in a great(er) percent of the population losing their jobs, which would have resulted in the deaths of many people (it is impossible to know exact numbers). Also, laissez-faire capitalism would make it very easy for businesses to control/abuse their workers, since the government would not be able to restrict them.
Thank you for commenting. I know that economists were against and with the bailouts. Still some are against it and have good reason tp. You are correct that the business cycle has some debate over it, but if you look in history and compare when the government breaks the cycle ( even today) it just causes more problems, and more companies that were bailed out to become dependent on the government, and the government would have a part of the company which causes even more problems if it fails.
ReplyDeleteAs for laissez-faire, there is debate like you said. Now, Fannie Mae, and Freddie Mac, were made by the government, to give out low interest rates. This just caused a bubble to grow and these companies to take over the market. As you can see this could of all been avoided if we didn't make them in the first place. And these banks that were bailed out were made by government, by Roosevelt in the late 1930s. If really date back the problems, they all lead to the government made Banks, which shows government should not go in between the market.