Wednesday, September 24, 2008

Gambling with Blank Checks

Edgy is a careful consumer. He won't buy something if he can't "look under the hood" and find out what he is getting. NPR Marketplace has been emphasizing today that Congress is being asked to sign over $700 billion for a Wall Street bailout without being told in detail exactly why the money is needed or how it will be used. Kudos to everyone in Congress who is at least pretending to stand up to this political thuggery.

This (proposed) $700 billion is US taxpayer money. (And also has an effect on all the governments and individuals around the world who own US dollars.) Since we, and not some abstract voting entity called "Congress," will be actually footing the bill, doesn't it seem reasonable that the US public should also be briefed on the specifics of why the bailout is needed, and where the money is going?

If our money is being used to bail out Wall Street, shouldn't we get a detailed estimate of how the money will be used, and a detailed report of where it went? Edgy gets that much information when he takes his car to the dealer. Why not for Wall Street?

How can we know if the government/Fed will use our money wisely? Surely we are not being asked to trust our government on faith? And given the staggering cost, waiting ten years to see how things turn out isn't very satisfying either. All the crooks will be long gone by the time their mismanagement is revealed.

Frankly, Edgy thinks that any company which wants taxpayer assistance should be required to post its entire set of assets and obligations publicly, including the "off-balance sheet" trickery that hides the real financial state of a firm. But that's another story.