"Thank God it passed!"

[adamuu]

Dem: We could have let economy fall and been in majority for 40 years
http://www.rawstory.com/rs/2010/12/dem-economy-crash-power-40-years/
http://thehill.com/blogs/blog-briefing-room/news/132021-dem-we-could-have-let-economy-collapse-and-been-in-majority-for-40-years

A departing Democratic lawmaker says his party is paying a political price for doing the right thing and working to rescue the economy from the financial collapse of 2008.

Baird insisted Democrats did the right thing passing TARP, which was signed by President Bush in the fall of 2008. Most Democrats in Congress backed it while it faced more resistance from the GOP.

However, allowing an economic crisis to cascade in order to blame the previous White House is a risky and debatable strategy. Baird, considered a conservative Democrat, has not shied away from controversial opinions.
Following his electoral loss in November, Baird lashed out at the leadership of his party.

Filed under : Department of Democratic Party regrets.

[Angry Dragon]

1. At the time I was in favor of the bank bailout

Looking back I think we should have let them fail and found out who was to blame for the fraud

[AlecBGreen]

2. I think we should have let them fail...

Part of me agrees, though the mess it would have created is hard to estimate. Even so I think we are only prolonging the inevitable by propping up this parasitic industry. People need loans to be sure, and an economy can survive for a time under debt. We, however, have created an insatiable debt monster that must be continually fed. How long before we have to face reality?

[Angry Dragon]

7. We would be facing it now

they crooks would mostly out in the open
Now we know it is coming but have no idea when and the
crooks will just walk away.

[LawnLover]

29. Yeah, that's would've worked.

:eyes:

[Taitertots]

10. At what cost?

If we let the banking system collapse, how is it going to effect the working class? Is a worse recession really worth it? We already know what caused the collapse, we don't need to shoot ourselves in the foot to find out.

[Angry Dragon]

13. What I see happening is that it is just a matter of time

until you or your children find themselves there anyway.
There will be such a demand for jobs that wages will go down, health care will be too expensive or non-existent, Social Security will be a joke, wars will continue, taxes will go up or services will go down, education will be controlled by corporations, and you better not be gay, and you better believe in a god.

[Taitertots]

16. It doesn't have to be that way

None of that would be made better if we let our financial system collapse.

Even in the worst case scenario where all of those things happen, the situation would still have been made worse by intentionally tanking the financial system when we could have prevented collapse.

[Angry Dragon]

20. Nothing has changed in the banking and wallstreet industry

We just put it off for awhile. Look at the foreclosure mess, nobody seems to want to do anything about it.

Unless a great leader comes along, a revolution of some kind, this country will continue down the slope of the ancient civilizations.
This is what I see. I hope I am wrong.

[Taitertots]

22. There is still a chance for positive change

How would pushing us down "the slope of ancient civilizations" make us better off?

Nobody want to do anything about it. But they still COULD do something about it. Destroying the financial system would exacerbate the foreclosure problems.

[Angry Dragon]

23. I do not want us to go down the slope

If nothing changes that is where we will go.
Do you see banks being reined in??
Do you see corporations being reined in??
Do you see any jobs being created??
Do you see health care getting more expensive??
Do you see unions being attacked??
Do you see education being reformed for the better??
Do you see hate increasing and being accepted in this country, hell the world??
Do you see that if you do not believe in the correct god you are looked upon as evil??

I do not need answers to these questions. These are the things I see as an attack on the people
on the bottom. All I am saying is this is what I see. These things will destroy this country.
Unless something happens, I see a very different future than what we have lived through.

[Taitertots]

25. Neither do I which is why I don't think we should run down it

How would destroying the financial system make any of those problems go away? It would push us further away from solving our problems.

[Angry Dragon]

26. What would you do to rein in the banks and wall street??

[Taitertots]

27. How much time do you have?

Long Story Short...
Ban Mortgage securitization. Ban Collateralized Debt Obligations. Impose a reserve requirement for ALL investment activities. Ban derivatives. Put all the Investment banks under government control, eventually shutting them all down. Strengthen the SEC...

Not Wall Street Related but good ideas.
Dramatically increase taxes on the rich. Dramatically reduce taxes for the working class. Have Universal Single Payer Health Care. End the wars of aggression.

[Angry Dragon]

30. There you go

you just saved this country
now if only there were enough people in DC
to see that

[Witan00]

31. I'm beginning to think that letting the country plummet into a full-scale depression...

might have been for the best. Maybe if things had gotten horrible enough, it would have finally triggered a massive populist uprising (which we so DESPERATELY need right now) to go and cut the rot and corruption out of our government, like the Eastern Europeans did in 1989. Short term pain for long term gain. Instead we passed TARP to keep things slightly less horrible and it's back to the usual "Situation Normal, All Fucked Up". The rethugs may be able to score political points by criticizing TARP now. I would like to have seen how they would have tried to spin it if the economy finally crashed and burned right as Obama took office. Perhaps then their wild attempts to shift blame would have finally caused the American people to see them for the outright criminal organization they are.

[Taitertots]

33. I have a different interpretation of how that would play out

Everyone would blame Obama and the Democrats for the collapse. Republicans scream bloody murder about how Obama caused the depression and we lose both houses at the midterm election. Any chance to make the economy better is lost as Republicans sabotage Obama. Palin and Beck become President and Vice President.


Think Wiemar Germany replayed in America. There is a good chance that the uprising won't have the results you expect. Especially if the problems are obviously our fault.

[Witan00]

41. And if that were to happen, then at least we would finally know with absolute certainty....

that the US really is broken beyond any hope of repair. It's just like Sarah Palin running for president. Most likely she won't win. But if she does, then at least we'll know the depth of how insane this country is and can act accordingly*

(*that is, seek asylum in Canada or Europe)

[Taitertots]

45. How would that make things better?

You would be intentionally destroying the economy in order to show that it is broken. If we didn't support the financial system it would be broken beyond repair and it would be OUR fault.

[Lorien]

3. A bailout with no strings attached was just a setup for delaying an economic collapse

not preventing one.

[femrap]

8. I think it was just the

'final heist.' The last transfer of taxpayers $$$ to the Banksters. They're using taxpayers money to trade on Wall Street. And Bernanke is giving them $$$ at no cost.

This is a Depression for Main Street. Eventually the debt will become overwhelming and it will all collapse...and I look forward to that....then Wall Street can feel like Main Street.

[Pale Blue Dot]

11. EXACTLY. +1 nt

[glitch]

34. Well said. nt

[bemildred]

4. Should be: "We could have let banks fall and been in majority for 40 years" nt

[adamuu]

6. Yes n/t

[Tierra_y_Libertad]

5. Baird was my rep. Good riddance to him.

[davidwparker]

9. No, save the economy and then PROSECUTE those who

were involved in the fraud.

Not prosecuting the banksters and Bush/Vadar is where the mistake was made.

[JackRiddler]

19. Saving the banks is destroying the economy.

They've merely been revived to keep doing everything that caused the problem in the first place.

The many trillions poured into useless bailouts that left criminal banks more powerful, and yet even more on the brink of disaster, could have instead bailed out the states and created a new system based on state banks, credit unions, and development funds for a truly new economy.

At the very least, saving the failed banks was the insane part. Save the ones who were solvent instead, at least. They actually gave the criminal banks (who haven't changed) a further competitive advantage over the chump banks who didn't bankrupt themselves.

[glitch]

35. Again, well said. nt

[davidwparker]

38. Makes sense.

And, PROSECUTE the banksters.

[Exilednight]

12. We should of let the banks fail. All we did was put off the .......

inevitable. If the banks were allowed to fail, many big names would of collapsed, and the big names that were left would of been too weak to buy out the fallen. And even if the bigger names did buy out the fallen, they would need to be much more prudent about it, or they would of dug themselves a deeper hole and put themselves on rockier ground.

In the meantime, many smaller and medium size institutions who ran their business in the proper manner would of been better positioned to snatch up parts of the fallen at pennies on the dollar.

Those same small and medium size institutions would of grown into larger institutions, but probably would of seen what happened to the big names and have grown at a much more conservative pace while keeping a solid footing.

With many of the big names gone, there would be no one left to hire lobbyists and it would have been easier to pass a Financial Reg bill with real teeth instead of the water-downed weak kneed legislation we currently have.

In the long run, if this had come to past, we would be seeing solid growth at this point.

[Angry Dragon]

14. Yes

[Odin2005]

18. Bingo!

[Tuesday Afternoon]

28. +1000

[BzaDem]

32. In reality, many smaller and medium size institutions who ran their business in the proper manner

would all be out of business. Because that's what happens in a depression with 25% unemployment.

[Exilednight]

36. We would of never hit 25% unemployment.........

the people who would of lost their jobs were people who were making the large sums of money. The FDIC insured all deposits, so the branches would of needed to be kept open, thus the lower level employees would of kept their jobs. A millionaire being out of work is not going to have much impact on the economy, they're not going to foreclose on their house, they're not going to collect unemployment or food-stamps.

Odds are, many more people would of kept their homes. With the medium and smaller banks buying the loans at pennies on the dollar, it would of allowed those banks to refinance those homes at much lower rates and still make tidy little sums from those loans. Even if they refinanced the house at half its value, and purchased the loan at 15 cents on the dollar, they would of still made a 20-25% profit after all other costs are subtracted.

This in turn would of freed up more capital for small businesses. In fact, most small business loans are being financed by small local banks who did run their business properly vs the large institution banks that are sitting on large sums of money.

[Name removed]

40. Deleted message

Message removed by moderator. Click here to review the message board rules.

[apocalypsehow]

43. You hit it exactly right. And, per usual when considering some posters, all you got in reply was

horseshit.

I've had that experience myself with **** **** ******, and the denouement filled my PM box with congrats on how easily it was handled. Same here. :thumbsup:

[apocalypsehow]

44. Changing the subject - per usual. n/t.

[Name removed]

39. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Greyhound]

15. There were plenty of alternatives to this disastrous abdication. n/t

[Name removed]

17. Deleted message

Message removed by moderator. Click here to review the message board rules.

[ProSense]

21. Baird makes no sense

Speculation about Democratic rule for the next 40 years was not worth an economic crisis that would have caused more suffering. Does anyone believe that would have made today's Republicans more cooperative?

The bailout was necessary, albeit a costly emergency action due to Bush's inaction.

Elizabeth Warren (PDF)

Through a series of actions, including the rescue of AIG, the government succeeded in averting a financial collapse, and nothing in this report takes away from that accomplishment. But this victory came at an enormous cost. Billions of taxpayer dollars were put at risk, a marketplace was forever changed, and the confidence of the American people was badly shaken. How the government will manage those costs, both in the specific case of AIG and in the more general case of TARP, remains a central challenge – one the Panel will continue to review.

The Obama administration managed to get most of the money back.

[GeorgeGist]

24. File under nonsense

The Financial system is still collapsing.

[adamuu]

46. It appears we traded a fast collapse for a slow one

transaction cost: total loss of the public favor.

[A HERETIC I AM]

37. It seems to me that many DU'ers don't really understand what was at stake in those frightful days...

in September of 2008.

Throughout all of the hand wringing on DU about this subject over the last couple of years, I have seen damned few posts that actually hit the nail on the head as to why it was so important to do what the Federal Reserve and the government in general did during those few weeks when the shit was literally hitting the fan.

It also seems to me that many members of this board just do not grasp how important credit is to business, ie: the ability for freely available money to be borrowed for short, medium and long terms.

The fact is, during the days and weeks of the latter part of September, 2008, a year after the DJIA peaked at 14,198 intra-day, the international credit market virtually collapsed. We still struggle with its aftermath today.

Du'er Lucky Luciano wrote an EXTREMELY informative post as a thread topic way back then. Lucky has admitted publicly that he works(ed) as a "Wall Street" type "Trader", the ones that DU'ers love to hate. But his post is well worth a re-read. Kindly get by the bits you don't like and read it for its information and insight. The thread itself is filled with vitriol and snark, but the man knows what he is talking about and his OP is filled with information that is invaluable to understanding what happened in just a few critical hours time.

Here's the thread

It is of utmost importance to understand how the complete collapse of credit would have devastated YOUR way of life.

I have been, for most of my adult life, an over the road tractor trailer operator. I have worked for numerous firms and not ONE of them handed me a stack of $100 bills to pay for my almost daily diesel fuel purchases. Almost every single gallon of commercial truck fuel in this country is purchased on credit.

So what would happen if they let the banking system completely and utterly fail?

Well, it almost did. What happened was almost over night......during the day, actually, people that lent money, even those for VERY short periods, like 12 hours or overnight LOST ALL CONFIDENCE THEY WOULD BE PAID BACK. No bank, credit underwriter, insurer...no one, all of the sudden, had any confidence that money they might give to someone else would be repaid.

All business to one extent or another runs on credit. If you are a manufacturer, you have to have the raw materials to make your product, put it together, get it shipped and then sell it. All that takes time and your suppliers are waiting for their money until the product you made finally gets sold and you finally get paid. If that system collapses, business grinds to a quick halt.

As a trucker, I can attest to how it would most directly affect the average American. If I pull into a truck stop with my fuel gage hovering around empty and my fuel card is declined, I'm screwed. I can't go anywhere. If I have a load of ....well...whatever I'm carrying, it moves no further until I can get either my card approved or some cash in hand. Since all of the above is tied together, I might be very well stranded until things get sorted out.

In September of 2008 we were literally within hours of such a circumstance. No one wanted to extend credit of ANY kind, be it short or long term.

If the entire system had collapsed, we would have seen the country literally grind to a halt, with truckers and trucking companies unable to fuel their trucks and therefore a cascading effect would have occurred. No food to grocery stores. No fuel to truck stops, etc. etc.

Although the "THANK GOD IT PASSED" thread was widely vilified on DU (and continues to be), the OP of that thread (who is no longer with us) had it ENTIRELY CORRECT.

Your god damned right "thank god it passed". If it hadn't who knows what would have happened.

Food riots, most likely, Within 2 to 3 days.


Bet on it.

Edited because I hit "post message" too soon as I was proofreading. Spelling, etc.

[Safetykitten]

42. Food riots, Goldman Sachs sleeping with cats and dogs!

Well we will never know what could of happened, as this controlled burn of the banking industry did nothing but entrench them.

The economy needs these wildfires. Things change from them.

Look what happened the last time. Quite a stable banking system that ran well instead of running over us.