Any of you define yourselves as Libertarians?

[turbo]

Denying the obvious? Oh come on. Without the government policies which let those banks gamble with other people's money, they would have never acted as they did. The government was responsible to pay all of the "bets" the banks lost. The banks really had nothing to lose by taking advantage of the system. If they lost the bet, the government paid for it, if they won, they got paid, if the system collapses, they get bailed out. In all scenarios the government was a major player. Also, without the bail out, the banks would be MUCH more cautious in their "bets". Even if everything I just said is completely wrong, watch this video in which people who know more economics than you or I will ever know disagree with you. Even if you disagree with them, at least acknowledge the possibility of it NOT being a free-market collapse.

It was not a free-market collapse. It was a confluence of crooks and gamblers gaming the system while regulators looked away, PLUS Fed officials making sure that the crooks and gamblers could get access to our money for next to nothing. In return, people like myself who have saved all our lives and wanted to use interest on our savings to supplement our retirement were and are still getting screwed. Banks, credit unions, and investment firms pay next-to-nothing in interest because they don't have to. Unless the Fed tightens up the money faucet by increasing interest rates, we will still get screwed. The Greenspan/Bernanke philosophy of keeping money free for Wall Street is responsible in part for the concentration of wealth at the top and the pressure on the middle-class, poor, and retirees. Lest anyone make any idealogical inferences regarding my identification of culprits, BOTH major political parties are complicit in this pandering to the wealthy and powerful.

 

[nismaratwork]

Denying the obvious? Oh come on. Without the government policies which let those banks gamble with other people's money, they would have never acted as they did. The government was responsible to pay all of the "bets" the banks lost. The banks really had nothing to lose by taking advantage of the system. If they lost the bet, the government paid for it, if they won, they got paid, if the system collapses, they get bailed out. In all scenarios the government was a major player. Also, without the bail out, the banks would be MUCH more cautious in their "bets". Even if everything I just said is completely wrong, watch this video in which people who know more economics than you or I will ever know disagree with you. Even if you disagree with them, at least acknowledge the possibility of it NOT being a free-market collapse.

Oooooh... so in other words, "she was asking for it".

 

[ParticleGrl]

Denying the obvious? Oh come on. Without the government policies which let those banks gamble with other people's money, they would have never acted as they did.

What government policy "let" the banks gamble with other people's money? Either the banks are free to loan out/invest money as they see fit, or they are regulated. It was a failure of regulation that allowed the banks to be leveraged to the hilt. Even doing away with fractional reserve banking (an Austrian favorite) would be a government regulation.

Pension plans/commercial banks/etc knowingly invested in CDOs, etc, mostly because the market makers knowingly mislead their clients. Again, a failure of regulation to prevent simple fraud.

The government was responsible to pay all of the "bets" the banks lost.

No, it wasn't. Fanny and Freddie bought up SOME of the subprime mortgages. However, Goldman, Bear Stearns and Lehman bought up FAR MORE. Why do you think Lehman collapsed? It was holding bad bets, and the government didn't pay. It was only when everyone realized how terribly precarious the position we were in that the government stepped in.

Keep in mind that the derivatives that blew up (mostly swaps) happened on the over-the-counter market. This market is neither regulated, nor government backed. It represents, to my knowledge, the free-est market in banking

Also, without the bail out, the banks would be MUCH more cautious in their "bets".

Without the bailout, the world economy would have ground to a halt. Yes, I'd like to see those bankers which engaged in fraud investigated and arrested, but I understand why the banks were bailed out.

Even if everything I just said is completely wrong, watch this video in which people who know more economics than you or I will ever know disagree with you.

Nothing is stopping you from sitting down with some books and learning some economics.

Also, not all pundits actually know what they are talking about (in fact, most don't). The Cato institute is loaded with proponents of the Austrian School of Economics. Even other more mainstream libertarian economists point out their underlying theory is empirically wrong. See, for instance, http://econfaculty.gmu.edu/bcaplan/whyaust.htm

 

[Ivan Seeking]

Denying the obvious? Oh come on. Without the government policies which let those banks gamble with other people's money, they would have never acted as they did. The government was responsible to pay all of the "bets" the banks lost. The banks really had nothing to lose by taking advantage of the system.

Not true. Paulson struggled terribly with the need to maintain market discipline. He most of all wanted to allow banks to fail. But after allowing one failure [Lehman Brothers] and then seeing the markets start to crash in response, he recognized that global economic collapse trumps market discipline. At that moment he recognized the depth of the problem - it was systemic.

Note that in his testimony during the time of the crisis, he explicity cites the need for market discipline and that regulation and access was needed to avert systemic risk. This is from not only the Treasury Secretary, but a former Wall Street giant and iconic free-marketeer.

In a presentation to the US House Committee on Financial Services last Thursday in Washington, Henry Paulson, the US Treasury Secretary, said that “For market discipline to effectively constrain risk, financial institutions must be allowed to fail.”
Paulson outlined his proposals for equipping the SEC and the Federal Reserve to be able to avert events that posed unacceptable levels of systemic risk but reminded the Committee that regulation alone was not the answer. The Fed needed the authority to access necessary information - whether from a commercial bank, investment bank, a hedge fund, or another type of financial institution - and it needed the tools to intervene to mitigate systemic risk in advance of a crisis. But financial institutions had to be encouraged to exercise market discipline...

http://www.chasecooper.com/News-Regulatory_Regulation-2008-07-14.php

 

[Ivan Seeking]

It was not a free-market collapse. It was a confluence of crooks and gamblers gaming the system while regulators looked away, PLUS Fed officials making sure that the crooks and gamblers could get access to our money for next to nothing.

So it was a failure of the market and a failure to properly regulate the market, which again means a failure of the free market. How exactly do you arrive at your conclusion based on your statement? All that you've done is to reenforce my point that the free market failed and regulation is needed. When left to run amok, the markets turned into one big casino. And we all lost as a result.

There is nothing in a free market to prevent "too big to fail". In my view, this is the now painfully obvious achilles heel of free-market puritanism. No doubt, in the abstract, the market will correct itself. In theory, on paper, as an academic exercise - a gedanken experiment - the free market probably works. The problem is that in the real world, we can't afford to live with the market corrections!

I still believe markets should be as free as possible, but the incessant smokescreening of clear market failures is destructive. The tea partiers have made a religion of denying objective reality here.

 

[Al68]

So it was a failure of the market and a failure to properly regulate the market, which again means a failure of the free market. How exactly do you arrive at your conclusion based on your statement? All that you've done is to reenforce my point that the free market failed and regulation is needed. When left to run amok, the markets turned into one big casino. And we all lost as a result.

There is nothing in a free market to prevent "too big to fail". In my view, this is the now painfully obvious achilles heel of free-market puritanism. No doubt, in the abstract, the market will correct itself. In theory, on paper, as an academic exercise - a gedanken experiment - the free market probably works. The problem is that in the real world, we can't afford to live with the market corrections!

I still believe markets should be as free as possible, but the incessant smokescreening of clear market failures is destructive. The tea partiers have made a religion of denying objective reality here.

What do you call the religion of constantly referring to a government regulated market as a free market? Over and over and over?

There's no point in arguing the semantics of what the words "free market" mean, but the market that you point to as having failed was not in fact the same type of market libertarians advocate. No use or misuse of economic phrases will change that fact.

 

[nismaratwork]

What do you call the religion of constantly referring to a government regulated market as a free market? Over and over and over?

There's no point in arguing the semantics of what the words "free market" mean, but the market that you point to as having failed was not in fact the same type of market libertarians advocate. No use or misuse of economic phrases will change that fact.

Your obsession with semantics is both annoying, and annoying... neither of which forwards the discussion. Anyway, to answer, if you tell me the name of your religion, I'd spell it backwards and say that's the answer.

 

[OmCheeto]

Then I would suggest that you are interpreting the items in that list very differently from the way libertarians do.

Obviously.

I don't have much spare time lately during the week(sleep-work-sleep-work-sleep-work), so maybe I'll break this down into subroutines:

The 10 core principles of the classical liberal & libertarian view of society and the proper role of government:
1) Liberty as the primary political value
2) Individualism
3) Skepticism about power
4) Rule of Law
5) Civil Society
6) Spontaneous Order
7) Free Markets
8) Toleration
9) Peace
10) Limited Government

#6 & #10

Spontaneous Order & Limited Government

In every society on the planet, due to spontaneous order, a government forms.

Since according to Forbes, America has one of the lowest tax burdens in the industrialized world, our government must be, in relation to the other industrialized nations, more limited.

Ergo, we are more Libertarian than the rest of the industrialized world.

Ok then, time for bed. I'll be back tomorrow.

 

[Al68]

Since according to Forbes, America has one of the lowest tax burdens in the industrialized world, our government must be, in relation to the other industrialized nations, more limited.

Ergo, we are more Libertarian than the rest of the industrialized world.

I'm not quite sure if you intended this, but I agree completely that the U.S. is more economically libertarian, on average, than the rest of the world.

And the http://en.wikipedia.org/wiki/Index_of_Economic_Freedom" backs that up, too. It lists the U.S currently as 9th.

 

[OmCheeto]

I'm not quite sure if you intended this, but I agree completely that the U.S. is more economically libertarian, on average, than the rest of the world.

And the http://en.wikipedia.org/wiki/Index_of_Economic_Freedom" backs that up, too. It lists the U.S currently as 9th.

I'm quite sure I intended it, but I don't see Forbes listed there in Wikipedia. I was referring to the http://www.forbes.com/global/2009/0413/034-tax-misery-reform-index.html" .

And I'm supposed to be asleep at the moment, so I'll let this foment for about 24 hours.

 

[edward]

Denying the obvious? Oh come on. Without the government policies which let those banks gamble with other people's money, they would have never acted as they did. The government was responsible to pay all of the "bets" the banks lost. The banks really had nothing to lose by taking advantage of the system. If they lost the bet, the government paid for it, if they won, they got paid, if the system collapses, they get bailed out. In all scenarios the government was a major player. Also, without the bail out, the banks would be MUCH more cautious in their "bets". Even if everything I just said is completely wrong, watch this video in which people who know more economics than you or I will ever know disagree with you. Even if you disagree with them, at least acknowledge the possibility of it NOT being a free-market collapse.

And yet these people who supposedly know so much never mentioned that CDO's or CDS's were totally unregulated and over the counter. The private mortgage companies wrote 80% of the sub prime loans. You can only blame fannie and freddie for 20%.

http://www.cnbc.com/id/15840232?play=1&video=1145392808

Link is Boring for the fist 15 minutes then it cuts to the chase.

Just exactly who pumped Fannie and Freddie to help people with down payments?? BRB Edit:

 

[nismaratwork]

I'm quite sure I intended it, but I don't see Forbes listed there in Wikipedia. I was referring to the http://www.forbes.com/global/2009/0413/034-tax-misery-reform-index.html" .

And I'm supposed to be asleep at the moment, so I'll let this foment for about 24 hours.

Sleep Cheeto... turn off the computer and sleep, and thank you for the excellent link.

 

[edward]

The Libertarians never could get enough of a following to garner any major progress.

Don't look now but they have hijacked the Tea Party. Now they can really do some damage.

Arizona just dropped MEDICADE for any childless adult. That is about 280,000 people and includes people in nursing homes. (supposedly for budgetary reasons)

They are busy working on a new bill allowing concealed weapons on college campuses. They already approved carrying concealed in any public place that does not have a metal detector and armed guard at the door..OOPS forgot, the first thing that they did was to allow anyone to carry concealed without a permit or any training. (apparently just for the hell of it)

 

[OmCheeto]

Sleep Cheeto... turn off the computer and sleep, and thank you for the excellent link.

Sorry. Can't. The music's too loud!

https://www.youtube.com/watch?v=TaG9SDxwPBg

 

[Ivan Seeking]

The Libertarians never could get enough of a following to garner any major progress.

I wouldn't say that. Alan Greenspan was a dedicated Libertarian and the guiding force behind the economy for twenty years. Libertarianism was also the basis for Reaganomics. But there is a huge difference between a genuine Libertarian like Greenspan, and your typical tea partier. For example, I am quite sure that Greenspan isn't a Birther.

Greenspan may have been wrong, but I still have tremendous respect for the man.

 

[Ivan Seeking]

And yet these people who supposedly know so much never mentioned that CDO's or CDS's were totally unregulated and over the counter. The private mortgage companies wrote 80% of the sub prime loans. You can only blame fannie and freddie for 20%.

The CDO's and CDS's may be the best examples of a failed market. It seems ever so clear now: Unregulated markets will self-destruct. Listen to the guys who were writing the contracts. Even they know it was nuts. Many describe the situation as a big party that no one wanted to end. They were drunk with greed and having a great time. Damn the consequences!
http://www.pbs.org/wgbh/pages/frontline/meltdown/view/

In the housing sector, the attitude was "If we don't do it, someone else will".

It also seems that as much as irresponsiblity and unethical behavior, arrogance was a huge factor.

 

[OmCheeto]

Lets look at 3 and 8 on the list:

The 10 core principles of the classical liberal & libertarian view of society and the proper role of government:
1) Liberty as the primary political value
2) Individualism
3) Skepticism about power
4) Rule of Law
5) Civil Society
6) Spontaneous Order
7) Free Markets
8) Toleration
9) Peace
10) Limited Government

Skepticism about power, and toleration.

Why does it seem that people on the right of the political spectrum are tolerant of power in the private sector, but intolerant of power in the public sector? Why is it ok for hedge fund managers in New York to spend half a million dollars in an attempt to unseat an elected official in Oregon? Where is the skepticism of financial power?

Ah! Late for work.

Bye.

 

[Al68]

Lets look at 3 and 8 on the list:
Skepticism about power, and toleration.

Why does it seem that people on the right of the political spectrum are tolerant of power in the private sector, but intolerant of power in the public sector? Why is it ok for hedge fund managers in New York to spend half a million dollars in an attempt to unseat an elected official in Oregon? Where is the skepticism of financial power?

Ah! Late for work.

Bye.

The "power" referred to in that list does not refer to buying power, spending power, or any other figurative sense. It refers to the ability to use force against others. Certainly voluntary private transactions don't constitute power in that relevant sense.

There simply is no power in the private sector in the sense relevant to that list, since government has a legal monopoly on the use of (non-defensive) force.

So the difference isn't private vs public power, it's the use of force vs voluntary associations. The private sector relies on voluntary associations while the public sector may use physical force.