Meeting their self-imposed deadline for figuring out how to waste 700 billion dollars of your tax dollars to bail-out the people and businesses who created our current economic ‘crisis’, the U.S. Congress and President George W. Bush (R) have reached a bailout agreement. Under the agreement, which is expected to formally become law this coming week, the government can use part of that $700b as free handouts and part as ‘investments’ where the taxpayers become partial ‘owners’ of some of these failing businesses.
Unlike Bush’s initial proposal, the new agreement would include limits on severance pay and other payments to the executives who created this mess. The bailout will be watched by two new government agencies charged with oversight, and the Department of Treasury is required to establish a government insurance program for the benefit of these failing businesses (with its costs coming out of the $700b figure).
In other news, largely ignored by the mass media, Congress has also passed a 25 billion dollar loan guarantee for failing U.S. auto manufacturers. This is the government’s largest intervention ever in the auto industry, eclipsing the 675 million dollar guarantee that saved Chrysler from its own idiocy in 1980. This is (potentially) more of your hard-earned dollars on the line trying to save American businesses that should instead be allowed to fail. Bad business decisions have consequences (or, at least, they should) and the government has no Constitutional or moral authority for intervening.