Constant Conservative

In response to Chet – yes, part of the huge “spendulus” package was a tax break – something like $13 a week right? I’d consider that one step forward. However, much of rest of the “spendulus” and the 3+ trillion budget soon to be passed are about 20 steps backward. The net result? Not good.

I dont’ think we’re completely a socialist republic just yet…there are just a few considerable pieces which now are – those companies now getting orders from the government. I’d say we’ve become about 5% socialist – just enough to set a bad precedent, but yet stay slightly under radar.

Like many liberal causes, we’ve not jumped head first into socialism completely, but just taken a number of little steps in this direction. Liberals know their ideas would be rejected, so they try to get there slowly, carefully, hoping not to take too big a bite at any one time so hopefully our apathetic and short-memory culture won’t notice.

The sooner we stop the stupid precedents, the easier it will be to correct the mistakes.

“How, exactly, can we be “moving towards socialism” if, in fact, the course of government has not substantially changed?”

What I was trying to say here is that the government hasn’t made one big move, one overall bill, to move toward socialism. Merely little steps here, a little slide there.

“What “little steps” have we actually taken under the Obama administration? We haven’t nationalized the banks or any other industry; the bailouts happened under Bush.”

I agree Bush began the bailout move, which was a bad idea. The companies should have been allowed to fail, and reorganize through bankruptcy as needed. Obama then continued and expanded this with further bailouts for banks, insurance companies, auto industry, etc. He essentially doubled down.

“What “little steps” have we actually taken under the Obama administration? We haven’t nationalized the banks or any other industry;”

An example of one little step under Obama is after the bailout, then going back to the company to comment on how they may use their funds in general. If it was not laid out in the bailout contract, then gov’t has no further right to say.

Another little step recently was President Obama essentially firing the CEO of a private company. This is government telling a company what to do, outside their contractual rights. This is not country-wide socialism, it’s just one little step, one precedent, in that direction.

Have we nationalized these banks/companies completely? No. Have we nationalized some decisions? Influence? Some aspect of how they run? Yes. That’s the “little step” I refer to.

” that would have caused the second Great Depression. (The first one was bad enough.)”

I highly doubt one company going through a bankruptcy would have caused a second great depression, even had they completely gone away. That said, they would more than likely have used forms of bankruptcy where the company doesn’t just dissapear, but corrects some things and still comes out the other side. There would definitely have been financial damage to various groups, no doubt. But there’s damage being done now anyway as government tries to “solve” it.

“Shareholders in a company have always been allowed to comment on how they may use their funds, since they have part ownership of those funds. Particularly majority shareholders. I don’t see how that’s “socialism”.”

I would agree that a shareholder has the right to comment on and influence a companies decisions. But the face that government is a shareholder, not to mention majority shareholder, seems to reinforce the point that these are “socialistic” moves. I think the point is govenment should NOT be a shareholder, and therefore NOT have that influence. When government owns something private, that’s a socialistic direction.

“it’s true that he set conditions for GM receiving Federal bailout funds. Again, any lender or bank or shareholder would be allowed to set the same conditions, since GM was completely free to reject the Federal government’s conditions…In what sense has any of this been outside the government’s contractual rights as a shareholder?”

If the lender, in this case gov., clearly lays out the specific conditions of their lending in a form of contract GM must agree to ahead of time, then yes I’d say they could make those types of requirements. I’m just against the method where there’s money flowing or agreements made first, and then if or when gov. feels like it they can go back and add/adjust conditions as they see fit. Case in point – AIG bonuses.

Again, if they become shareholders as discussed above, then gov. may do this. But again I think that’s a bad idea in the first place. If you’re going to be a lender, just be a lender. Lay out a specific contract, and that’s it.

“The next dominoes to fall would have been AIG, CitiGroup, Bank of America, Wells Fargo, and Goldman Sachs, as well as the entire American auto industry; and then all the industries that either provide services to or are themselves capitalized by those companies.”

…are you sure about that? Would it have gone exactly that way? I don’t believe that’s an established fact. That is the theory motivating much of the bailout moves, yes, so you’re not alone in that thinking for sure. Certainly some of those above may in fact have had trouble or a bankruptcy. But whether that whole doomsday scenario would have happened, is a point of not-unanimous opinion.

And as I mentiond above, a bankruptcy doesn’t mean these companies would just “go away”. They’d most likely be back reorganized or in slighly different form, minus some of the ‘toxic assets’ they couldn’t sustain. Those other servicing companies would still have a company to service in most cases.

” as well as the entire American auto industry”.

…probably some of it, yes. Some of them, however, would have just been able to cancel some of the unsustainable union contracts which are currently one of the anchors around their necks. Perhaps their contracts with workers would then come back to earth in relation to their competitors, and they could begin making vehicles at a profit again, and continue buying the parts from their servicing companies.
Would there be some pain and loss? Sure, but if they’re going to survive, there’s going to be one way or the other.

“If the government can legitimately buy a computer, can buy a pencil, or can buy any other item available on the free market, then they can certainly buy stocks.”

Gov. owning fixed-life items like your examples computer/car/tank/pencil, is quite different than buying an ongoing ownership in a formerly private company. Can they legally do so? Sure. It is a socialistic and generally bad idea? Yes.

(AIG) “…the government was not actually able to clawback any of the bonuses…”

They didn’t actually get it done, but were in the process of doing so with that 90% retroactive tax. Once Obama saw the huge constitutional blunder dems were making, he asked them to drop it I believe.

So no, gov. is not able to do that, but this group of legislators don’t seem too bothered by those rules.