Looks like Europe is still more socialistic than we are:
The shame of it all is that we have done such a poor job of learning the right lessons from economic disasters in history. We should have learned from the Savings and Loan debacle that when government absorbs business risk for private players, the private players act as if there is no downside to their risk-taking. We should have learned from the same from the accounting scandals in the late 1990's. Lo and behold, we should have learned the same thing from the current mortgage-based mess.
But we haven't. We are still on track for a much larger mess in unfunded government entitlements (Social Security, Medicare, and state and local public employee benefits) that no bailout check is going to come close to resolving.
Our only hope is a radical restructuring of what we expect from government and dramatically less spending on new or current programs until we get the old obligations under control.
The handwriting is on the wall.
Monday, October 13, 2008
Cold comfort
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What we should have learned by now is that there is no human activity that doesn't need regulation, oversight and penalties. It doesn't matter if it's a football game or an economic system. That is the role of government.
You said: "Our only hope is a radical restructuring of what we expect from government…" We should expect fairness from government and regulation to ensure that all are playing by the same rules.
As far as adequate funding is concerned, we need only to implement Alexander Hamilton's proposal for raising taxes. In Federalist Paper 12, Hamilton wrote:
"The ability of a country to pay taxes must always be proportioned, in a great degree, to the quantity of money in circulation, and to the celerity with which it circulates. Commerce, contributing to both these objects, must of necessity render the payment of taxes easier, and facilitate the requisite supplies to the treasury."
The movement of all moneys needs to have a proportional system of taxation. The British have approached this piecemeal. They have a transfer tax on all stock transactions.
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