It seems like forever since we've heard anything from the gentleman from Clute, but Janet Yellen's confirmation hearings brought him out of hibernation and into the following interview with CNBC. He actually sounds somewhat optimistic about the choice of Yellen for the job, but his warnings remain the same about a system designed for continual boom and bust cycles and he doesn't have much good to say about a Fed tapering scheme that looks pretty toothless. It makes me wonder sometimes, as a libertarian. Should a single person or organization be managing the US economy? Absolutely not. But have they managed to produce the outcomes they were looking for over the past five years? Well, yeah, they kinda have. I wonder if Paul ever considers that, or if he only ever thinks in terms of century-long time frames.
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"But have they managed to produce the outcomes they were looking for over the past five years?"-Eddie we will need to wait and see what happens after full taper/fed exit in order to really determine if the outcomes they were looking for are accomplished. And i am not so sure they have, even the FED acknowledges the unemployment rate is faulty/misleading and their price stability mandate, ie inflation is lacking. So, yes they did save the banks/financial system from a complete meltdown, and yes majority of asset class prices are much higher, but what are their stated outcomes? Unemployment/price stability? In that case they haven't succeeded.
Having a fiat currency and a Fed is supposed to smooth the economy out. Stimulus in a downturn, higher rates and restrictive policies when things are overheated. If this is what our "smoothed out" economy is like I would hate to see it free wheeling.
Very much in agreement, while i do believe the real economy is shit, signs everywhere for this, and small-mid size business owners i speak to, (and i do this every chance i get) have all said business has still not recovered. But at the end of the day the fed did get asset prices to all time highs, so yes they won the battle, but its not over have 75 Bill a month to stop, and 4 trillion to wind down. good luck.
If only I could point at computer screen and say, "You see those bits there, they are now worth 4 trillion dollars."
Eddie, I'm concerned by your statement about what 'we' are looking for. What exactly are we looking for? Going off their dual mandate of price stability and employment... those are pretty suspect. Lower unemployment rates with a declining participation rate isn't really that great and price stability... well. Lol.
I guess what they were really looking for was the ability to prop up illiquid banking institutions as well as most of an insolvent US population by backing up the mortgage and bond markets. Fair enough. They fought off deflation which you can argue is either a great or awful thing but in doing that they have begun inflating bubbles again. I mean it is clear to see that every system at times needs to simply flush itself out and continue on going. Economies, to me, are really no different. The issue nowadays is that there are so many vested interests and people have gotten so overleveraged that such an event would be devastating.
At this point Ron Paul has so much invested in his opinion he can't see clearly. All he can do is hope there's a recession, somewhere, somehow, to try to add some correlational 'proof' to his view so he can prance out shouting "SEE HOW MUCH THE FED SUCKS!!!!!!". This is not unlike Meredith Whitney's approach to calling the markets at this point: even a broken clock is right two times a day.
I totally agree with some of the things he says. We could see a bit of an equities bubble right now, especially if earnings stay low or they dip into their cash reserves. Taxes are too high, the gov't spends too much money, welfare's incentive system needs adjustment, the fed is definitely not the only thing that could be used to grow the economy, gold isn't entirely worthless, and so forth. My problem with Ron Paul and his supporters is that they are so much more interested in "ideological purity" than actual leading or using their heads that I just can't take them seriously. They're like cartoon characters at this point.
What they don't see is that YES, fiat+Fed prevent much more massive swings, total collapses, and extremely uneven growth...and by extension the massive social upheavals that accompany such swings. We need a strong military (note: strong =/= large). Unemployment benefits are a really, really, really good thing. Welfare is in need of upgrades and better auditing and charity is great but the public system is designed to help people that those with the resources to run a charity historically don't care to help. The gov't can farm out services (see: ACA, military contractors) to the private sector and provide a structure for business to make money while serving a public good. It's time to actually start working along the lines of "health care" instead of it's current disease management incentive structure. Infrastructure is pretty fucking necessary and America is starting to fail at it. Paul and libertarians refuse to see that 1+1=3 isn't limited only to business, and that the gov't has FAR more resources to change things at the national and global levels.
Listen, if business fixes something or innovates, then I'm all for it. I'm also in agreeance with Addinator that there is a large amount of inbreeding in the system that needs disposal. Where I break with libertarians is that when a large social problem festers, I'm 100% OK with the gov't stepping in to deal with it. Ideally, the gov't will become more proactive but American culture in general is pound poor and penny wise, so that's unlikely to change...ever. I like maximizing my money and personal freedom, but there's so much more to running a country than that and if the libertarians don't want to deal with them then yeah they're never going to have any large amount of durable power.
Let's not forget, if you have people saying we are in a bubble we aren't in a bubble. When you are in a bubble people don't question if there is a bubble.
I fail to see how the Fed has prevented any massive swing. It was the Fed keeping rates too low for too long that led us to the tech bubble and the RE bubble.
Or maybe this is bubbe inception, where we're in a bubble and think that because we know it's a bubble that must mean we're not in a bubble, thus we think we can't be in a bubble even though we are, creating the situation that we don't realize we're in a bubble?
call it whatever the fuck you want, asset prices go up bec fed policy, qe and easy money, will crash, buy again and fed will repeat. easy as sin
Which leads me to think maybe they're on to something, lol...
Yes, called the wealth effect. I was stupid enough to leave market early, did buy fear (not enough) in 08, sold about 300 points ago (s and p). learnt my lesson, buy the fucking dip, fed will bail you out, ie bail wealthy out, or wealthy enough to own stock "According to Gallup's annual Economics and Personal Finance survey, which was conducted in April, just 52% of Americans are personally or jointly with a spouse invested in the stock market. This is the lowest level since at least 1998."
Read more: http://www.businessinsider.com/us-stock-ownership-at-record-low-2013-12…
This is what the Fed was hoping to accomplish?
Scale the chart back to the 30's and observe. This was the worst recession since then. The crash of 1948...most people haven't even heard of it. By "massive" swings, I mean systemic failure akin to what we see in African and some South American nations with weak/corrupt governments. In the shorter run there are boom and bust cycles, but in the bigger picture the financial system has prevented the total collapses typical before then. To some people this means that we must REALLY be overdue for a total crash, but to me it says that a superior technology has made life, on average over time, better for the majority.
Dealing with people whose ideological presets won't let them acknowledge this is kind of useless, hence why Ron Paul and his son are marginalized. They just can't see the larger picture.
I agree with you that Paul and his pseudo-Austrian gang are floating in an overly pessimistic boat. I consider myself to be thoroughly optimistic by almost any measure, and I despise these sorts of doomsday prognostications. Liberated people are remarkably adaptable and will be able to deal with a broad array of economic situations in a far more efficient and expedient manner than did our 1930s counterparts.
That said, I think the suggestion that the Fed has "accomplished its goals" to be at least mildly dubious. I've been aghast to the policy reaction to the 2008 meltdown, and it would be incredibly hard to convince me that QE programs, fiscal expansionism, etc. have, in any way, helped our situation.
Just because recency bias prevents us from recalling the full extent of these previous crashes doesn't negate their intensity - the data reveal just how bad they were! The claim "things would have been worse without QE and fiscal spending" is a scapegoat at best. To put it plainly, I'm not convinced.
Given the steeper downturn and more rapid recovery of the less regulated parts of our economy vis a vis the more drawn out crevasse and return of more regulated sectors, I'm much more willing to watch the market organically recover should we face a similar situation in the future.
Simply put, this is my greatest fear in recanting everything economic I've believed my whole life and tipping my hat to the Keynesians. Recency bias is a very real thing, and I wonder if that's all I'm enthralled by. But the fact remains: I'll be 45 this year. If I'm lucky I'll see another 30 years, but I wouldn't bet on it. The Keynesians were in place for the majority of my life and I don't see that changing. Nor do I see the catastrophic failure of our economic system in the next 30 years I expect to be alive; if anything, I think we'll persist in a zombie economic state for at least that long a la Japan.
So if it doesn't happen in my lifetime, was I wrong? I'm starting to think I might have been.
I mean, I've never considered a tenant of Libertarian philosophy to be "all mixed economies are doomed to fail within the span of a human lifetime". In fact, countries possessing established wealth on the scale of the USA or Western Europe are almost certainly carry no near- or medium-term risk of total catastrophe. It would take decades upon decades of stagnant economic growth for developing markets to overtake the Western world.
If, tomorrow, the USA were to relinquish all belief in free markets, begin taxing the wealthy at 60-70%+ rates and squeeze the economy to a halt in dramatic fashion, I have no doubt that the country would continue to dominate the global economic dialogue for decades to come.
As a matter of policy, all of this is utterly irrelevant. The question is not "can we maintain economic primacy by instituting xyz policy?", but rather "what is the optimal economic policy to produce best outcomes for the average American on the average wage?" If nearly a century of Keynesian economic policy hasn't convinced you that fiscal expansionism isn't the optimal economic tool, I don't know what can.
The facts of economic growth remain (and, in truth, continually reproved to be) crystal clear:
If something about the course of human history over the last several centuries has convinced you that central economic planning is virtuous policymaking, I'm all ears. Until then, I will be unendingly mystified by the fact that this is still a matter of debate. Something that has been so unequivocally empirically demonstrated and is, decade after decade, vindicated by the progress of global society.
I'm an optimist and am so confident in the power of human ingenuity; if anything shakes that confidence, it's our dumbfounding inability to recognize such a simple reality.
This doesn't make a lot of sense...
Thanks for that.
I would be happy to expand on this a little bit...
My problem with your post is that you operate with very poorly defined terminology, which lends itself well to slogans, but not to an in-depth examination.
For instance, what are "free" markets exactly? Are countries like Denmark and Sweden which ARE, in fact, taxing their wealthy at very high rates (maybe not quite 60 - 70%, but close) practicing "free markets"?
What metric are you using to convince yourself that a "century of Keynesian economic policy" isn't optimal? I can sense counterfactuals, but I would love to understand the specific logic here a little better.
I am not that familiar with Hong Kong, but I am pretty familiar with Singapore. When you call Singapore one of the "freest" economies, what metric are you using? 'Cause, from where I am sitting, it's, in many ways, not very free at all.
What are "liberal economies" exactly? Singapore and Sweden, are they equally liberal?
The main point that I would make isn't that central economic planning is virtuous policymaking (although the example of China might actually tempt one to think this way even). The point is that, at the current stage of our development, some degree of central planning is required. This is a fact of reasonably basic economics/mathematics. Assuming this is true, it's a question of what particular central planning arrangement is, on a relative basis, more optimal than the others. I would suggest that a central bank is, generally speaking, a more optimal arrangement than, for example, monetary policy conducted by the elected politicians. It's also more optimal than many other alternatives I can imagine. If you can imagine and propose a better arrangement still, pls don't hesitate.
Apart from the points made by UFO, my main issue with Ron Paul is that all his concepts are, simply speaking, utopian. Yes, of course, some of his criticisms of the current system are valid, but, even after the most shallow examination, his "alternatives" are simply not viable. Moreover, I sometimes marvel at the self-contradictory nature of some of the grander views Ron Paul embraces.
It's easy to criticise. It's much more difficult to find solutions - even to the more obvious flaws in the current system.
In reality none of us are Fed chairmen so lets all go back to drinking shots of fireball.
Just because Ron Paul can't get the majority of mouth breathers in this country to buy into his concepts doesn't mean they are bad. We can't have a serious economic discussion because idiots vote based on small time social issues.
And yeah, lets go back to the great depression. Was it the Fed and monetary policy or was it a manufacturing based economy and a world war that got us out of the crisis? I am sure dying on Normandy was so much more preferable than the bread line.
Little tweaks have major ripple effects. The smartest people in this country/world do not full understand the ramifications of their actions. Yeah, QE "saved" the economy. If by saved you mean inflated equities and millions switched from unemployed to permanently disabled, then yes, 3 cheers. We also have no real plan to unwind the Fed's ridiculous balance sheet.
Humans are dumb. All of us. The sooner we realize this the better we will be.
Ron Paul's concepts, when examined critically and without resorting to utopian assumptions, are, in fact, bad. Calling people who disagree w/Ron Paul "mouth breathers" and "idiots" isn't a particularly strong argument in favor of his views.
How many of the people dissenting with Paul and providing a thoughtful critique vs. those that could spell economics if pressed. My comment wasn't direct at anyone who wants to provide an intelligent argument for or against his policies.
Man, you need a vacation.
I'm not sure if this thread is an actual policy discussion or grumpy bitchfest among jaded former republicans.
Any economic policy that involves any sort of restrictive control can be technically proven wrong. Even things like no work on Sundays can and do skew the path of the system. So it doesn't matter what camp you buy into you are in one way or another wrong. So instead of developing carpal tunnel arguing about the validity of a system that is so fucked up no one could figure it out in a million years lets talk about getting hookers and blow.
Good luck convincing people on this board that "no work on Sundays" is an economic policy.
I disagree that the system is not-understandable: it was built by humans. As an analogy, maybe the construction of a huge building could seem beyond comprehension, but rest assured that there's a blueprint in some architect's office somewhere. The political, financial, international, and cultural systems we live within don't have one central planner and it's not possible to...but they do have key architects and knowledge bases explaining what is going on. Well, at least the rationalle. Life changes, people do different things, and there are so many facets of life that one person/group can't keep track of it all. But if you look at concentrated areas of decision making power and pay attention to what they're thinking, saying, and doing, you can get a pretty rough idea of the larger picture. Then, just fill in the blanks where you specialize. For most of us here, that's the financial area and the specialized sub sector we work in.
Ramanunja (I think) said that understanding reality is like blind men feeling different parts of an elephant and our experiences are very subjective. However, I take the analogy further and say that those blind men all talk to each other and can figure out much more when they argue/converse and put their heads together.
As much as I argue with people on this site, I've actually learned A LOT these last couple of years. When Ron Paul supporters stop asserting that they have the answer for everything in their neat little theory, then I can take them seriously. Until then, they're like anyone else peddling a belief system....anyone can get a few things right but I really take issue with looking at all of life through an impossible point of view.
I said no one person can understand the entire system. Can a person understand a small part? Sure. Can a large group of people pool their knowledge to better understand the system? Sure.
But believe me, in no way can anyone or any group fully understand every bit and bob of any economy at any given point in time 100%. The fact that you can not with 100% certainty know how every person and system involved will react in every situation with every possible set of circumstances.
Notwithstanding the follies of the construction metaphor (engineering and physics vs. behavioral psychology), you're still missing the bigger picture of your own metaphor.
A blueprint merely represents the schematic structure as a system of physical loads, tensions and compressions. Knowing the architectural design of the building, however, falls well short of comprehending the structure itself. For example, the architect, who drew up the blueprint, doesn't know how to fell trees properly for the wood trim for which his design calls; he doesn't know how to mine bauxite, he doesn't know how to mill, desilicate, digest, clarify and calcinate that bauxite into alumina; he doesn't know how to smelt alumina into aluminum; he doesn't know how to engineer the fasteners needed to assemble that aluminum into a window frame or understand the glassblowing process to fit architectural glass into his aluminum frame to finish a curtain wall; he doesn't know how to mix aggregates, mine metallurgical coal, refine iron ore into steel, or amalgamate these ingredients to yield steel-reinforced concrete. More mundanely, he doesn't know how to mine graphite needed to put the lead in his sketching pencil, or how to yield paper from cellulose pulp, or how to design an internal combustion engine for the dump trucks at the construction site; he doesn't know how to draft up the legal documents needed to proceed with construction; he doesn't know how to structure the financing package for the developer; etc.
In truth, the blueprint reveals precious little information about the totality of superstructure. Worse still, reading or drawing up a blueprint endows you with an illusion of comprehension - a false sense of confidence and expertise. In much the same way that the architect confidently pontificates about the structural integrity of his building only to have to collapse due to metallurgical impurities, the economist often mistakes his understanding of the economic skeleton for comprehension of the economic system.
Experience and study have taught the architect much about design, the engineer much about loads, the aluminum smelter much about electrolysis, all of which come together in magnificent fashion in the modern skyscraper. Each of these specialties combines scientific theory and empirical observation to refine comprehension. Unfortunately, human behavior is often intractable relative to physical laws, which means that the study of economics leans more heavily on theory with a healthy dose of empirical observation.
Many of RP's ideas, if a bit arcane, are rooted in a sound understanding of the central principle that has driven the whole of economic development across the world: that by liberating individuals and leaving them to their own initiative, society benefits immensely from specialization and exchange. This is the principle that builds superstructures through the collaboration and exchange of ideas inherent in smelting, engineering and architecture; and it is this principle that has been inexplicably threatened by recent fiscal and monetary policy.
I much prefer a somewhat misguided, but admirably non-partisan and principled Ron Paul to a host of the politicians we have actually elected to office. A great deal of them ignore the central principle of economics, which has been vindicated and revindicated over the course of centuries, in favor of their own prowess of central planning. It's the result of that very same illusion of comprehension; the belief that as long as we they are smart, people in Washington can better engineer the economy than can hundreds of millions of independent and autonomous actors.
What they do not appreciate is that their superstructure is far more complex than their blueprints suggest, and that without the collaboration of hundreds of thousands (millions?), the grand edifices of modern America would never have been possible, despite their self-declared ingenuity.
A building is dealing with math and physics. Economics is a social science. When we come up with an equation that predicts and maps how humans react then we will know. Until then it is a best guess.
Yah, for sure, otherwise the index charts would basically be straight lines.
Maybe that's why we're seeing these large swings since +/-2000. People are acting with utter certainty due to their worldviews and the march up and then down and then up again has been uniform. A few voices see things more clearly, but apparently people who truly understand the larger picture are few and far in between.
I didn't engage you in any conversation, not sure what you are talking about.
LOL I completely agree with you. What I'm getting at is that people aren't even looking at the blueprints for most of the aformentioned structures. You're completely right in pointing out that a lot, probably most, of the political, economic, and definitely cultural structures basically run off of "best guess of what morons around the world will do". I'm pointing out that most people, and a shocking number of relatively smart folks, haven't the faintest clue of why or how or when major decisions are made by politicians and business leaders.
Easy example is the construction of highways and infrastructure. It's there to make the country run better overall. Same with the post office. Same with police, firemen, and teachers. Same with the military. Without these things, it gets pretty nasty pretty quickly. Yes there are inefficiencies, yes it's partly about control, and yes a private company could maybe do better in some cases. In the big picture, it's a different story. People supported the politicians who put these things into place. People sign up for jobs like police and fire where they make far less than say, a banker, in exchange for risking their lives. I actually know a former banker trying to become a fireman. They do it voluntarily. And as far as privatizing the fire dept....do you really want to create a situtation where they let someone's house burn and people die in it on the off chance the guy forgot to pay his bill? Think about that. The gov't will answer to the voters and public opinion at large...do you think shareholders will care about such an incident if their returns are 20%? Probably not.
A more nuanced structure is gov't contracting or a requirement forcing people to go to an industry. ACA is apparently still debated, but defense contractors are a really easy example. The gov't really couldn't build a plane or gun as efficiently as a company like, say, Boeing. On the flip side, without a dedicated customer, Boeing would not be nearly as large as it is and their economy of scale would suffer. That and they'd be hawking F35's to every petty dictator willing to loot his country and front the cash. So, everyone here comes out ahead. Issues of who's in control, is the right plane from the right company being deployed to the right warzone....debateable, and rightly so. But the underlying mechanism is pretty clearly defined.
A more debateable example I can think of on the fly is when the gov't took over AIG. It wasn't 'socializing it' for the sake of controlling things. That's an ancillary feature. The overarching point was to prevent the company's explosion from progressing to complete collapse, the effects of which were feared to ripple outward and compound an already grim situation. A lot of people, especially in finance, saw this as government overreach and whatnot, or point out Paulson's position in the dynamic as helping GS. There's plenty of validity to these claims but it's not what I'm looking at. I saw it as triage. Let a dozen huge banks collapse, let the economy collapse, do nothing and let nature take it's course is what we heard from the libertarians. That's insanity. Tell several hundred million people their country is going down the shitter because a few morons bid up housing prices and underwrote a lot of bad loans to facilitate this and you're looking at a civil war or total anarchy. Sounds good in theory, but if you've ever camped out in your own house with a rifle, prepared to use it against your neighbors and a horde of looters heading in from a different region, you start to rethink that position when the simple solution is to do what works NOW.
I can concede that private industry could be utilized in many ways that would make life better, but a libertarian is so unreasonable they can't acknowledge the above points, so they leave no room for negotiation and turn everything into a zero sum game. They do this, IMO, out of ignorance of human nature and how things work, things that while variable, are pretty well understood in a general sense. That's all I'm really getting at.
Personally, I look at gov't and Michael Jackson's estate the same way: both are highly dysfunctional entities that people, for some reason, keep throwing money at long after the actual founders have died. The very act of me turning on a TV and watching a movie where Jackson's music is played in a movie generates income for his estate and I can't even stop it. Taxes, yeah it would be nice if they went down, but until people make an effort to be reasonable the gridlock will continue.
A debate about which public utilities and services ought and ought not to be privatized is beyond the scope of this thread. That said, nowhere in this thread is anyone suggesting that the fire department be privatized. There are plenty of reasonable arguments on either side, you've brought up many in favor of keeping these basic services public - wonderful, consider me signed off.
These public vs. private debates for basic protective utilities are inane. I much prefer to simplify: the public demands central services to protect its property rights against primal threats. In return, it is willing to part with a certain percent of its income in the form of taxes. We willfully abdicate concerns re: price discrimination (the rich pay more for these services, sure), and accept them as necessary evils. Could these functions be better performed by private entities? Perhaps, but this is a fruitless dialogue: people have their minds made up already, and they operate under intellectual frameworks that prevent them from conceiving of their opponent's worldview.
One thing is certain: the Leviathan was one of the primary forces leading to the pacification of the globe over the past several thousand years. Even authoritarian, despotic governments were successful at reducing death rates and violent crime (even if you include their own ruthless slayings). As primal concerns like homicide and intertribal skirmishes were tossed to the wayside, people began to focus more on their own prosperity and surplus. It is this transition that laid the foundation for liberal economies and democracies, which, in turn, pacified the world a further hundredfold.
Forget all of that.
What I argue against is the unequivocal excess of Western governments. Industries are hyper-regulated, welfare programs abound and multiply, military spending is unconscionable, education is being thoroughly mishandled - these are simple truths with which anyone can agree. We have a great deal of progress to make on those fronts before we need any serious discussion of privatizing the police force.
No one is upset about high taxes because they hate paying those pesky firemen to - gasp - put out housefires. They are upset about unquestionably wasteful spending programs like those listed above, regulatory mismanagement and budget overflows.
Let's take the fire department as a straw man, since you brought it up. That the fire department is operated by the government bothers me little; but spending over the past few decades is unbelievable! Even as the number of fire incidents has fallen dramatically, spending on the fire department and the number of career firefighters has shot skyward. And lest you think they are the ones preventing fires from occurring, the reality is that firefighters responding to medical calls has replaced actual firefighting.
None of this is to say that the fire department is a primary concern of mine; but it should be illuminating that the random example of necessary public service you mentioned is so emblematic of the broader problem with government today.
FWIW, this part of your post is an absurd straw man. A fact of which I'm certain you're aware. And the fact that you presuppose less central intervention would have led to total apocalypse indicates that you're unwilling to entertain an argument to the contrary. I'd offer you examples of how it was precisely this central intervention which helped precipitate the collapse in the first place, but it's outside the scope of this thread and I'm not sure it's an argument you're willing to hear anyways. Especially considering that - of all people - Ron Paul convincingly made the argument that central policymaking was spurring a housing surplus many years before the 2008 crisis.
Also, it's ironic to hear you talk about concerns of violence, when the liberal economy is one of the primary mechanisms that has allowed for such historically unprecedentedly low levels of violence.
Hold on a second, we're sort of talking in the same direction and I agree that gov't needs to be run more efficiently. My issue here is with hard core Texas libertarians, not you or your analysis. The majority of Americans agreed with, more or less, the gov't taking things over during the financial crisis until things stabilized. They did not like it, but they acknowledged that the alternative was worse.
Not the libertarians. They called for letting everything collapse. Think about that for a second. What do they think will happen if the gov't lets the entire banking system fail? Or that it even could? Why would the gov't not protect the value of its currency, GDP, or citizens? In a case where too much of the system fails, I see people basically saying "fuck it" and grabbing what they can while they can before all hell breaks loose. The libertarian mind says, "things will work out on their own". Cute, and true in maybe the very long term. But no. And what if it doesn't? Who's to say that we'll recover from total destruction of the financial sector? And why would someone even toy with the idea, let alone actively promote it? Both extreme situations are ruled out by the gov't taking action in that case. Imperfect, totally. Less than ideal, yes. Fixing a situation partly of their own doing, absolutely. But staving off a much worse and needless chain of events? I say definitely yes. The libertarian won't acknowledge that, they only argue for their idealized scenario and blame the gov't for everything.
They ignore that business allowed themselves to be drawn into such a bad position in the first place: actually, they ran into underwriting mess head first and had no problem accepting help. Point this out and all you get is "would have, should have, could have" but the real world doesn't run on that. I really just can't take libertarian though seriously beyond applying it to my own actions.
Look, you're being pretty dismissive here and painting a mockery of your opponent's viewpoint for your own comfort.
A more intellectually honest portrayal of your opponent's belief might go something like the following:
You and I both know one cannot solve structural problems by coercively transferring wealth or printing currency. Understanding that principle, we can easily agree that the Treasury could not have solved any underlying systematic issues by fiat. (Believing that it could would lead you to the obviously dubious principle that the Treasury should bailout any company facing problems, since it can create wealth at no cost!) It's interesting, then, to listen to you bemoan the unacceptable systemic risks posed by large financial institutions, which, of course, continue to exist only because our government refuses to let them fail.
I don't think you'll find any Libertarian anywhere - including the "hard core Texas Libertarians" (aren't Texans supposed to be conservatives??) - who would espouse the belief "allowing the banks to fail would have been no problem." On the contrary, they argue it would have been much, much worse than the bailout alternative! But they also rightly point out that whatever "solution" was offered by the Treasury in 2008 merely postponed the onset of that underlying problem. Indeed, I think this is what you'll find Ron Paul suggests: someday, the bell will toll and we will have to face the underlying reality of our financial issues.
There is a base of real and financial assets that compose the intrinsic value of our economy; printing currency, transferring wealth, pulling Keynesian levers, etc. cannot alter that tangible value. Whatever structural problems existed in 2008 still exist today, and there is no ethical justification that permits you to continue a life of false wealth at the expense of future generations.
Enormous industries have come and gone throughout recent (and distant) history without derailing the march of human progress. The 2008 collapse would have entailed a steeper decline had the Treasury not stepped in, no doubt. But that collapse would have permitted us to actually address the structural problems with large financial institutions by placing them into receivership. Considering the Treasury actually profited from its TARP investments, one might suggest that the extent of the tangible financial damage was overstated and a full recognition of its costs would have been less apocalyptic than you are led to believe by the media.
In any case, that's a much more reasonable portrayal of your opponent's argument.
However, I'm not going to sit here and go back and forth with you about the 2008 demise, you clearly have your mind made up, and it's hardly the point here. The crux of the debate here is illustrated by two opposing value judgments:
Ignoring all of this tangent, you're still not addressing the Libertarian arguments as they stand today: the bailout happened, that cannot be changed. Are you willing to entertain progress on other initiatives, including, but not limited to curtailing welfare and defense spending, reducing regulatory bloat, etc.?
NorthSider, it's been a crazy day, so I apologize for not responding. I will, in the next few days.
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