The Blog @ Spolitics

Democrats Not So Keen On Responsibility

The Democrats have refused to take any responsibility for the current financial mess despite the fact that their finger prints are all over it. If the election results were any indication, they’ve managed to pull it off so far despite the fact they’ve been running Congress for the past two years. Now that they have complete control over the federal government, they’re having to find new, creative ways to continue passing the buck to President Bush.

The latest: even though they’ve been shouting from the rooftops that we need to bail out the automakers, they apparently don’t want to actually pass a bailout bill that’s seen as theirs and not Bush’s.

The plan? Make it the Bush administration’s responsibility to give Detroit cash — namely by claiming after the event that the $700 billion rescue package for financial institutions was in fact a rescue package for auto makers. This was attempted with several hilarious “colloquys” — pre-scripted dialogues between members that were quietly inserted into the Congressional Record after the vote, all aimed at rewriting the “intent” of the law. Say, this one, from Oct. 1:

Michigan Sen. Carl Levin: “As Treasury implements this new program, it is clear to me from reading the definition of financial institution that auto financing companies would be among the many financial institutions that would be eligible sellers to the government. Do you agree?”

Connecticut Sen. Chris Dodd: “Yes, for purposes of this act, I agree that financial institution may encompass auto financing companies.”

Evidently, the Democrats still mistake commenting on events after they pass for leadership.

Was It Really Capitalism That Failed?

One annoying aspect of the current economic turmoil is the repeated claims that capitalism has failed. But when the Federal government subsidizes home buying through tax breaks and cheap interest rates, is that capitalism? When it pressures banks to make risky loans and then uses GSE’s to create a market for those loans, is that capitalism? Was it capitalism at work when the government bailed out Bear Sterns? Of course, not — one of the cornerstones of capitalism is to let bad companies fail.

In fact, the Bear Sterns bailout sent a message to Wall Street that Uncle Sam would be there to help save the day if needed. This dissuaded companies from cleaning up their act and encouraged continued risk-taking in a horrible economic environment. If one thing should be abundantly clear, all the various bailouts have done is encourage more bailouts. That’s not capitalism. Perhaps if we were more ruthlessly capitalistic, things might not have gotten as bad as they have.

Sure, the crisis has exposed flaws in our financial system. But many of these flaws have nothing to do with free markets and instead are the result of government interaction in the markets. You can’t pin it all on capitalism and we should question the motives of anyone who’s trying to.

Iran Calls Obama a Dangerous Phony

From WaPo:

Since 2006, Iran’s leaders have called for direct, unconditional talks with the United States to resolve international concerns over their nuclear program. But as an American administration open to such negotiations prepares to take power, Iran’s political and military leaders are sounding suddenly wary of President-elect Barack Obama.

“People who put on a mask of friendship, but with the objective of betrayal, and who enter from the angle of negotiations without preconditions, are more dangerous,” Hossein Taeb, deputy commander of Iran’s Revolutionary Guard Corps, said Wednesday, according to the semiofficial Mehr News Agency.

“The power holders in the new American government are trying to regain their lost influence with a tactical change in their foreign diplomacy. They are shifting from a hard conflict to a soft attack,” Taeb said.

Hopefully, this will be illustrative for anyone who thought electing Barack Obama would suddenly make everyone love us.