Billy, I love that excerpt. Thank you.

But her actual account of the adoption of such policies throughout the Third World, and of their effect, is largely on the mark. Her book is an excellent reference source on that subject, a sort of economic version of Blum’s *Killing Hope*.

What’s more, she hardly denies that corporatism–the active intervention of the state in the economy to privatize profit and socialize risk–is a very bad thing. And I can’t imagine her objecting to the inclusion of the bailout in that general category.

So I think you’re attacking a strawman here.

Now, what were you saying?

What do you mean “heading toward”?!?!?!

Definition: Fascism — corporate/government partnership

Totalitarianism is where we’re headed, for you who still think under the statist paradigm. IMO, any government with authority over the individual is totalitarian.

You may have heard that the federal government is preparing to bail out AIG and other companies to the tune of about 800 billion dollars. [Actually, the AIG bailout is already a done deal.] The plan is to buy up their bad debts and then try to profit from them by selling these debts to a third party when the time is right. The government can do this, not only because it has become unacceptable and unpatriotic to criticize them but also because they are in charge of printing the money so basically, they can print as much cash as they would like. There is, of course, the unfortunate side effect of making the dollar more worthless than it already is. If the government prints dollar bills fast enough, we could find ourselves in an economy like the one Zimbabwe enjoys, where it takes a million bucks to buy a gallon of milk. This would fit in perfectly with the Bush administration which has been spending like drunken sailors, which is partly why the national debt is somewhere around 11 trillion- that’s 11,000,000,000,000- Dollars as of now. (If we play our cards right it can be twelve trillion by the time you’re done with this article. Have faith!)

But since, as I mentioned, it is considered unseemly to say no to our Dear Leaders, might I make a small suggestion? You seem determined to spend money we don’t have. I don’t only mean money on the Iraq war (which may become the Iran war and then the Syrian war) but also on such delights as the $600 per household tax rebates of a few years ago. It fit in perfectly with the Republican vision that government is a monstrous evil that must be starved of funding. (Left unsaid is why Republicans want so desperately to be in control of an entity they despise.) Also, throwing a nearly-trillion dollar lifeline to companies who are near bankrupt due largely to their greed and bad business decisions, seems a bit at odds with the bootstrapping, responsibility-first philosophy of a Republican party which recently called Americans “a nation of whiners.” And so, allow me to propose an alternative- one that’s not only almost as economically foolhardy as your bailouts but will also take the wind out of the sails of John Edwards and other leftist populists who talk about “two Americas.”

True, John Edwards is a liar, an adulterer and a champion of the poor who gets four hundred dollar haircuts, but his central message can’t be ignored- not when, just before Lehman Brothers went down the tubes, its top executives were paid somewhere around twenty million dollars each. This, along with the “nation of whiners” crack- and the attitude it betrays- leaves many to rightly wonder what happened to the American Dream, the idea that we live in a meritocracy where everyone can make it with a bit of determination. The fact that this dream was always at least partially false and self serving is not the point. The point is that many who hear of these bailouts- and who hear about the amazing level of corruption inside certain corporations which preceded the need for these bailouts- are left shaking their heads in disbelief that we have so much in resources and elect to use them so poorly.

In addition, we don’t have that much by way of resources any more- not since we decided to bend over for every third world nation who is willing to be a source of cheap labor and also not since we decided to spend gazillions of dollars we don’t have. (Reaganeconomics anyone? If I told you, in 1979, that we can increase government spending and at the same time decrease th revenues the government spends, you would have thought I was nuts- and not only because I was a two year old Hungarian infant at the time.) The above-mentioned eight hundred billion dollars is probably coming from Beijing, not D.C. And before we throw that money at a slew of bad debts, hoping irrationally that throwing good money after bad is a sound economic policy, maybe we should consider an alternative.

The basic idea behind capitalism is that everyone makes their own decisions- on a levelish playing field- and will succeed or fail on their own merits. Of course, most capitalists merely pay lip service to this idea. Anybody out there who thinks that George W. Bush got to where he is based on his own smarts, grit and ambition raise your hands. Now slap yourselves. And he is not alone. If Donald Trump’s daddy hadn’t been a famous developer, he may never have had a tower named after him. I’m not even getting into the fact that about 13% of this country’s population descended from people who built this nation from scratch, did so for free, and usually at gunpoint. So its safe to say that we have probably gotten away from that wonderful idea of what capitalism is. It may even be safe to say that we never really gave capitalism a fair shot. But now we can. Here’s how.

Currently, about three hundred million people live in the U.S. legally. Taxpayers or not, they are all American citizens living in the land of the free and the home of the brave. And they need moolah- most do anyway. So I propose the mother of all rebates. Every American, here or abroad, gets a million dollars. It doesn’t matter who you are or where you are from or what your lot in life is. If you are legally entitled to it as an American, you get the cash. All told, this would be monstrously expensive if done in one shot but the savings will be invaluable. The second every American gets this cash infusion, we can say goodbye to bailouts, social security, grants based funding and so forth. Lobbyists, while not eradicated, will be vastly reduced. The drug war, which is essentially about economics not public health will be fought far less ferociously. Public health will feel the impact as well- addictions, often born of desperation [show me a well fed lottery player or a self-assured alcoholic] will decline. A diet high in carbs (because carbs are cheap) will be altered. Republicans will be happy (or will profess to be happy) since government will shrink. Democrats can finally stop talking about two Americans, thus freed to look for actual ideas and an actual platform that goes beyond a desire to be inoffensive to imagined swing voters in Omaha. Whats more, it will be an instant guilt reliever. In a society where 99% of human interactions and emotions revolve around cold hard cash, we will finally be equal. Of course this will force us to treat each other accordingly: whether your name is Donald Trump or Donald Smith, you are all granted an equal platform from which to achieve. After that, the guy uses that platform to reach the highest peak wins. Which is how capitalism is supposed to work anyway.

If your point is that sub-prime, fixed-rate, no-money-down, 30-year mortgages are a horrible idea, then I wholeheartedly agree. However, your example misses some details. First, bankers can’t just renegotiate your mortgage because your property value goes up. Second, you don’t have to pay capital gains on your primary residence. So, the couple in your example could have sold their house after the financial crisis and ended up back to even, and hopefully bought a cheaper house the next time.

I think the lesson to be learned from this is that we (well not me personally) vastly overestimated the value of home ownership, especially homes that are overpriced/beyond your means.

Sullivan: So you are in favor of real capitalism?

Klein: Well, I just want to see… where is it?

Sullivan: You don’t believe the government should be socializing all these industries?

Klein: This is socialism for the rich. Look, if we’re socializing things, let’s nationalize something profitable. Let’s go for Exxon. They’re socializing junk.

Hey, how about about that global warming crisis?!?

I got an approving nod on Klein’s book from a liberal friend of mine, but I can’t bring myself to buy a copy and read it; it seems like dreck and I don’t want to take a chance she’d make any money off it. Or spend a precious minute of my life on it.

>In principle, they’re the same thing.

I thought they were only the same thing in practice. At least that’s what all the advocates of socialism I’ve talked to have told me — socialism is awesome, it’s just never been done right.

Getting Answers From D.C.

In principle, they’re the same thing.

As a sarcastic jab at Klein, I agree with Radley completely. Klein is a complete farce and Radley’s point with respect to her is well made.

(For a minute, I thought I was in the wrong thread. :))

Wait, so this couple got an car, boat, and truck for an extra $10,000? Not bad. ;-)

I agree that the mortgage interest deduction is bad social engineering (if you’ll forgive the redundancy). It might be okay if the interest deductions were more even-handed, but having a special deduction just for certain kinds of mortgage interest creates a distortion and it is responsible for some of the instability we’ve seen in housing credit. (I tend to think that lending rules and the implicit guarantee that the fed would bail out Freddie and Fannie were more destabilizing, though.)

In addition to incentivizing debt, it has become one of the biggest obstacles to income tax simplification and reform. Many of the best reform plans would get rid of that deduction, but that is unpopular because it is hailed as the great middle-class tax loophole.

You can call me crazy if you want. If you pay attention to what is going on, it’ll drive you a little crazy. It’s that or ignorant bliss and denial. Don’t worry, I don’t want anyone to confuse me with you either.