Bush says sacrificed free-market principles to save economy

[ZDL]

http://www.breitbart.com/article.php?id=081216215816.8g97981o&show_article=1

SFW link


US President George W. Bush said in an interview Tuesday he was forced to sacrifice free market principles to save the economy from "collapse."

"I've abandoned free-market principles to save the free-market system," Bush told CNN television, saying he had made the decision "to make sure the economy doesn't collapse."

Bush's comments reflect an extraordinary departure from his longtime advocacy for an unfettered free market, as his administration has orchestrated unprecedented government intervention in the face of a dire financial crisis.

"I am sorry we're having to do it," Bush said.

But Bush said government action was necessary to ease the effects of the crisis, offering perhaps his most dire assessment yet of the country's economy.

"I feel a sense of obligation to my successor to make sure there is not a, you know, a huge economic crisis. Look, we're in a crisis now. I mean, this is -- we're in a huge recession, but I don't want to make it even worse."

At a G20 summit last month in Washington, Bush resisted some proposals for global financial regulation and argued free market principles still held true despite the global economic downturn.

And administration officials have also referred to the primacy of the free market when discussing a possible government bailout for the troubled US auto industry.

In the interview, Bush said that a "disorganized bankruptcy" of the carmakers could create "enormous" economic difficulties.

But the US president has yet to announce how his administration will proceed amid calls from Detroit automakers and Democrats for a bailout drawing on funds set aside for financial firms.

[bkb0000]

i have no problem with economic collapse... why do i feel so alone? let the financial institutions fail, let the auto industry implode, let them all burn. let the dollar go the way of the dodo. we're never going to strengthen our frail nation without something big. let it all fall, and we can rebuild the economy stronger than it was.

our economy is a gambling addict. like all addicts, it needs to hit rock bottom before it can muster the courage to come back up. if daddy keeps giving it money to stick in the video poker machine, it's just gonna keep on ****ing itself.

[Saginaw79]

BullSh*t!

What caused the last depression was government meddling to fix the problem


All this, is a calculated step toward socialism, just like when he sold us out at the UN meeting shortly after the stimulus, giving oversight to a UN committee in order to prevent such things from happening again

[EvilSpeculator556]

The trick of capitalism is socialism has been played on America. However I think the socialist scum are underestimating the american gunowner. The Bill of Rights has nothing to do with sporting purposes! Prepare for the inevitable history repeating itself BS.

[murphy j]

i have no problem with economic collapse... why do i feel so alone? let the financial institutions fail, let the auto industry implode, let them all burn. let the dollar go the way of the dodo. we're never going to strengthen our frail nation without something big. let it all fall, and we can rebuild the economy stronger than it was.

our economy is a gambling addict. like all addicts, it needs to hit rock bottom before it can muster the courage to come back up. if daddy keeps giving it money to stick in the video poker machine, it's just gonna keep on ****ing itself.

You're not alone. I'm right there with you, along with a few of my friends.

[Saginaw79]

The trick of capitalism is socialism has been played on America. However I think the socialist scum are underestimating the american gunowner. The Bill of Rights has nothing to do with sporting purposes! Prepare for the inevitable history repeating itself BS.

+1


And +1 to letting them collapse too!

[HES]

i have no problem with economic collapse... why do i feel so alone? let the financial institutions fail, let the auto industry implode, let them all burn. let the dollar go the way of the dodo. we're never going to strengthen our frail nation without something big. let it all fall, and we can rebuild the economy stronger than it was.

our economy is a gambling addict. like all addicts, it needs to hit rock bottom before it can muster the courage to come back up. if daddy keeps giving it money to stick in the video poker machine, it's just gonna keep on ****ing itself.
You'll get no argument from me at all.

[Jay Cunningham]

"I've abandoned free-market principles to save the free-market system," Bush told CNN television, saying he had made the decision "to make sure the economy doesn't collapse."

Finally, honesty!

:mad:

[AwaySooner]

What honesty? He's trying to save his rich friends. Let the free market work, failed banks would be replaced by other healthy banks, and use the fund to support those healthy banks.

[Jay Cunningham]

What honesty? He's trying to save his rich friends. Let the free market work, failed banks would be replaced by other healthy banks, and use the fund to support those healthy banks.

"I've abandoned free-market principles"

This.

[thopkins22]

Agreed that at least he's being honest...wrong but honest. However this cronyism isn't going to save the economy. It's simply going to set the stage for more and more, meanwhile our dollars are going to turn to crap once the demand is down from everybody going liquid.

I've said it before, new growth is a beautiful thing...but first the forest has to burn. If we had let the banks and the auto companies fail(for that matter any business that can't stay afloat on it's own,) there would be hard times for sure, but in five years we would have made the transition towards creating real capital by producing, saving, and exporting goods.

We're treating the economic illness with the same bad medicine that got us sick in the first place. Americans buying homes/cars/stocks that they couldn't afford, borrowing the money to do it, meanwhile producing nothing to pay off the debt.

It's not a sound theory, but according to the economists that are pro-bailout, nobody needs to save money...buy a house and let it save for you.

[Jim D]

So we've decided to give money to inefficient industries and businesses, that can't pay their own bills...so that they can continue to be inefficient, and go further into debt....and we're going to pay for it, by putting the entire country into (more) debt.

In all the econ classes I took, this never once came up as a "good idea".

Why are we letting this happen?

[thedog]

Relax, brothers. If it's not now, it soon will be Obama's Fault!!!

But I digress. I fear for our nation. I fear for my own family's future. God Bless the U.S.A. please, now more than ever...

dog

[Leonidas]

All this, is a calculated step toward socialism,

We've had socialism for quite some time, we're now taking that road towards fascism. Well, actually we've started on that road awhile ago, just starting to speed things up.

[SmokeGlider]

Socialism refers to a broad set of economic theories of social organization advocating state or collective ownership and administration of the means of production and distribution of goods, and an egalitarian society characterized by equal opportunities for all individuals and a fair or egalitarian distribution of wealth.

From where I stand, that doesn't describe the state of affairs in the US, at least not yet. But govt ownership of private industries like the financial markets and soon the auto industry is surely another step in that direction. This is some scary s#!t.

[czydj]

Relax, brothers. If it's not now, it soon will be Obama's Fault!!!


My educated guess? The Bush blame game will be used early and often in the next administration...

[Business_Casual]

The problem is that George Bush nor any other human cannot intervene to save an economic system.

All he has done is delay, and therefore make worse, the eventual manifestation of the root problems.

I think we could see hyperinflation and collapse of the dollar as the reserve currency of the world.

M_P

[bkb0000]

The problem is that George Bush nor any other human cannot intervene to save an economic system.

All he has done is delay, and therefore make worse, the eventual manifestation of the root problems.

I think we could see hyperinflation and collapse of the dollar as the reserve currency of the world.

M_P

hmm. delay it.... just long enough for the next asshole to take office? hahaha

[Shadow1198]

Complete and utter failure is plenty of incentive for businesses to curtail the use of unsafe and unethical business practices. That's capitalism WORKING. Yes, things in such a situation would be bad in the short term, but it would improve a hell of a lot quicker than it will now (assuming it even does). The government stepping in and saying "Well you're too big, so we can't let you fail" just lets them think they can keep getting away with it and the cycle continues. The worst part about it all is they are committing grand ****in' larceny with OUR money, the businesses that put us all in this economic situation in the first place are reaping the benefits, and the general population has to bend over and take it in so many different ways it's unbelievable. Basically, we are being forced into financial feudalism. In another decade or two our country will be so financially destitute that pretty much everyone will be working just to pay the bills, and no one will ever really "own" anything. Everything will be the property of the banks and the government.

[bkb0000]

In another decade or two our country will be so financially destitute that pretty much everyone will be working just to pay the bills, and no one will ever really "own" anything. Everything will be the property of the banks and the government.

dude... that's exactly how it is now. nobody pays cash for trucks and houses... nobody even pays cash for their guns/plasma tvs/boots/BILLS/gasoline/food/sex toys/breath mints... even contractors are getting POS systems and taking credit cards, now. I'm in the process of buying a system myself, in fact.

hah... the only reason i pay cash for everything is because i maxed out all my credit cards years ago.

[Submariner]

I think we could see hyperinflation and collapse of the dollar as the reserve currency of the world.

M_P

Oh, c'mon that's tinfoil stuff.;)

[Gutshot John]

I think we could see hyperinflation and collapse of the dollar as the reserve currency of the world. M_P

Actually deflation would be far more catastrophic and is a far greater economic threat. There was news that the Consumer Price Index dropped by the largest amount since 1932.

The bottom line is that Bush, once again, has proven that he's anything but a conservative. His statement about "sacrificing free market principles" to save the free market demonstrates how profoundly out-of-touch the man is.

I've no love for Barry O, but for cryin-out-loud, let's kick this pig.

[John_Wayne777]

With all due respect, I would correct Mr. Bush.

...We abandoned free market principles quite some time ago (like when we forced banks to start handing out loans to people who couldn't repay) and as a result many feel that we have to push further away from the "free market" to "save" the free market.

I'm not so sure that it's a good idea. Politics is a notoriously short-term business...and numerous decisions made for short term benefit often result in major disaster down the road.

Markets tend to do best when we don't screw with them.

....but when is the last time somebody got elected for promising to leave things alone?

[LOKNLOD]

Politics is a notoriously short-term business...and numerous decisions made for short term benefit often result in major disaster down the road.


Exactly... Politicians are not so much concerned with preventing bad things, as they are with preventing bad things on their watch.



....but when is the last time somebody got elected for promising to leave things alone?

I think you just summarized a huge part of the problem in the "fix the Republican party" thread.

[thopkins22]

Actually deflation would be far more catastrophic and is a far greater economic threat.
Deflation isn't a threat. The dollar has some strength right now purely because there is demand for them because everyone is liquid. There is lots of inflation going on now, and it is going to hurt us bad. What happens when short term interest rates go up, and all of a sudden we're paying hundreds of billions of dollars a year on the national debt? We either default, or crank the presses harder than they're running now.

[Gutshot John]

Deflation isn't a threat.

Virtually every economist in the world disagrees with that statement.

The dollar just fell, but that's not really the danger deflation really signifies.

Essentially demand falls to the point where goods are no longer worth what they cost to produce because people can no longer afford to buy them. Hence the largest drop in CPI since 1932...the last time we suffered from significant deflation.

Inflation by comparison is MUCH less of a concern.

[thopkins22]

Gunshot John, that's simply not true.

"What deflation does is provide a disincentive to borrow and an incentive to use current savings for purposes of investment. It means a reward for well-capitalized companies and individuals—a good thing all around.

Now we get to the crux of the matter: the Great Depression. The assumption is that falling prices somehow caused the economy to crumble. In fact, it was the after-effects of the boom combined with massive government intervention that caused the depression. The only silver lining in the entire period of the 1930s was precisely the falling prices that made the dollar count for more. Falling prices (a falling cost of living) are what Murray Rothbard has described as the "great advantage" of recessions. If you can imagine the Great Depression without falling prices, you have conjured up an image that is far worse than the reality.

Ask yourself whether during economic downturns, you want your money to grow or shrink in value? If your future job security is in doubt, do you want to pay more or less for goods? If your savings are meager, do you want them to have more or less purchasing power in the future? If you answer these questions rationally, you can see that deflation is wonderful for everyone, and the saving grace of a period of economic contraction. Throughout the 19th century, prices fell in periods of economic growth, which is precisely what one might expect. This is all to the good. "
Llewellyn H. Rockwell, Jr. http://mises.org/article.aspx?Id=1241



"It is true that without further government intervention there would be a deflationary spiral. It is not true that this spiral would be bottomless and wipe out the economy. It would not be a mortal threat to the lives and the welfare of the general population. It destroys essentially those companies and industries that live a parasitical existence at the expense of the rest of the economy, and which owe their existence to our present fiat-money system. Even in the short run, therefore, deflation reduces our real incomes only within rather narrow limits. And it will clear the ground for very substantial growth rates in the medium and long run.

We should not be afraid of deflation. We should love it as much as our liberties."
Jörg Guido Hülsmann http://mises.org/story/3231

[bkb0000]

It destroys essentially those companies and industries that live a parasitical existence at the expense of the rest of the economy, and which owe their existence to our present fiat-money system.

unless big daddy government keeps them alive.

[Gutshot John]

Gunshot John, that's simply not true.


If you say so.

[maximus83]

i have no problem with economic collapse... why do i feel so alone? let the financial institutions fail, let the auto industry implode, let them all burn. let the dollar go the way of the dodo. we're never going to strengthen our frail nation without something big. let it all fall, and we can rebuild the economy stronger than it was.

our economy is a gambling addict. like all addicts, it needs to hit rock bottom before it can muster the courage to come back up. if daddy keeps giving it money to stick in the video poker machine, it's just gonna keep on ****ing itself.

Exactly. What the hell are we so afraid of? When you have cancer, you gotta cut it out. When you have a limb with gangrene, you gotta cut it off. It's never pleasant, nobody likes pain. But trying to AVOID it infinitely in the sense that you avoid necessary treatment for the problem, eventually kills you.

The economy and country needs to "take its medicine" for the undisciplined borrow-and-spend binge, and the politically correct fiscal policies, that have put us in this condition. If we keep refusing to take our medicine, we will continue to weaken financially until we go into a slow, steady economic decline, if not an absolute and catastrophic economic crash. We need to let the economically unsound institutions and individuals fall--go bankrupt--in order to keep the ship of state and the economy from sinking. Our unwillingness to do that, and our attempt to "socialize" every individual loss and spread it out to the whole society, drags down everyone.

[automan]

Funny, FDR thought the same thing about his New Deal and only prolonged the misery into 1943.:)

[BAC]

With all due respect, I would correct Mr. Bush.

...We abandoned free market principles quite some time ago (like when we forced banks to start handing out loans to people who couldn't repay) and as a result many feel that we have to push further away from the "free market" to "save" the free market.

I'm not so sure that it's a good idea. Politics is a notoriously short-term business...and numerous decisions made for short term benefit often result in major disaster down the road.

Markets tend to do best when we don't screw with them.
Good stuff, all of this.


....but when is the last time somebody got elected for promising to leave things alone?
Public fear of deregulation has to be accounted for, first. Change the irrational fear of deregulation, and leaving things the hell alone, and you'll start to see real progress.


-B

[Saginaw79]

We are just sliding into more socialism, and Obama will accelerate the slide.

[John_Wayne777]

Public fear of deregulation has to be accounted for, first. Change the irrational fear of deregulation, and leaving things the hell alone, and you'll start to see real progress.


The reason they have that fear is because "deregulation did it!" has been the democrat talking point.

The financial sector is in the trouble it's in for a much simpler reason: They were handing out money to people who were a bad credit risk. Warnings about this were given repeatedly by Greenspan and others...and intellectual luminaries like Barney Frank told Greenspan he was off his rocker.

...yet Greenspan is gone and Frank is still in Congress.

The root cause here, of course, is the puzzling belief that government solves problems, particularly economic ones among the public. Government is damned good at creating problems (particularly when they try to "manage" the economy) but rarely has any useful ideas of how to solve them. This, of course, is lost on much of the public.

[thopkins22]

Gunshot John, I don't deny that deflation can cause some issues, but what you said about virtually every economist in the world disagreeing with me is patently false. Keynesian economists would certainly agree with you, however economists who argue for a true free market(Rothbard, Mises, Rockwell, and YOUNG Greenspan to name a few) agree with me.

Historically when you inject huge amounts of cash into a system, inflation is the result. And even if deflation really were on the way, it's not as terrible as our central bank would have us believe.

It's not just the people at Mises who agree with me, I can send you papers from Cato fellows who will argue the same.


Warnings about this were given repeatedly by Greenspan and others...and intellectual luminaries like Barney Frank told Greenspan he was off his rocker.

He may have warned us of the dangers, but he most certainly enabled it by taking the interest rates down to near nothing and leaving them for years. We would have had a recession early in this decade, but to avoid that they flooded the market with cheap cash...it was like leaving a kindergarten class alone with soda and candy...and warning them to not misbehave.

Greenspan openly acknowledges that as a nation we have an atrocious savings rate, and that this will really hurt us in the future, but refuses to admit that artificially low interest rates dissuade people/banks/companies from saving.

We as a nation are like heroin addicts. But rather than allow us to go through withdraw and get better, they simply decided to keep us high.

[Gutshot John]

Gunshot John, I don't deny that deflation can cause some issues, but what you said about virtually every economist in the world disagreeing with me is patently false.

I can't think of a single economist that thinks "deflation" isn't something to be concerned about and no it certainly isn't just Keynesians.

That the federal government is dropping interests rates to their lowest-rates ever and printing cash like there is no tomorrow, I'd say they're far more concerned about deflation than inflation.

You may disagree but you can take it up with them.

[thopkins22]

I can't think of a single economist that thinks "deflation" isn't something to be concerned about and no it certainly isn't just Keynesians.
Then you didn't read my posts...I quoted two of them, and even provided links to the papers I lifted the quotes from.


That the federal government is dropping interests rates to their lowest-rates ever and printing cash like there is no tomorrow, I'd say they're far more concerned about deflation than inflation.

You're right, Bernanke and crew have been correct literally every time they've made a decision in the past couple of years, let's take their strategy seriously and at face value.:rolleyes:

A perceived threat from deflation may be how they justify lowering the interest rates, but in reality they're simply trying to keep this whole phony economy rolling by providing cheap cash. It's a fundamentally unsound economy, Greenspan even talked about these very issues in "Gold and Economic Freedom."

[Gutshot John]

Then you didn't read my posts...I quoted two of them, and even provided links to the papers I lifted the quotes from.

No I did look at them but Lew Rockwell doesn't strike me as a reputable economist so I didn't really read further.

You're kidding yourself if you think deflation destabilizing currency is a good thing but you're certainly free to do so.

[thopkins22]

No I did look at them but Lew Rockwell doesn't strike me as a reputable economist so I didn't really read further.

You're kidding yourself if you think deflation destabilizing currency is a good thing but you're certainly free to do so.

I don't think it's a good thing, but it's certainly better than rampant inflation.

I've done quite well since moving lots of my money into commodities and foreign currencies, I don't expect the trend to last forever, but until we get some reasonable monetary policy I sure do. How much money have those who listened to "reputable economists" lost? Was Greenspan less than reputable in his youth?

[Gutshot John]

Was Greenspan less than reputable in his youth?

Whatever his professional reputation in his youth, your distinction qualifies your original statement.

[thopkins22]

Whatever his professional reputation in his youth, your distinction qualifies your original statement.

Fair enough, though I'm pretty sure if I look I can quote him recently saying that ideologically(though obviously not in practice) he still stands by his assertions in "Gold and Economic Freedom," but I get the sense that we'll still wind up going in circles.

We'll just have to agree to disagree on this.


ETA....To keep on topic, I found the video of W talking about abandoning free market principles to save the free market system. http://www.youtube.com/watch?v=UYdfvWVFmOY

[maximus83]

I can't think of a single economist that thinks "deflation" isn't something to be concerned about and no it certainly isn't just Keynesians.



Jörg Guido Hülsmann is a German economist and professor of economics at the University of Angers in France. He's also a senior faculty member of the Ludwig von Mises Institute. Bio details and publications on his web site (http://www.guidohulsmann.com/).

In an article titled Deflation and Liberty (http://mises.org/story/3231), Hulsmann writes, as a conclusion, that deflation is an important dimension of free markets, and thus, of our liberty:

"The present essay argues that this is a half-truth. It is true that without further government intervention there would be a deflationary spiral. It is not true that this spiral would be bottomless and wipe out the economy. It would not be a mortal threat to the lives and the welfare of the general population. It destroys essentially those companies and industries that live a parasitical existence at the expense of the rest of the economy, and which owe their existence to our present fiat-money system. Even in the short run, therefore, deflation reduces our real incomes only within rather narrow limits. And it will clear the ground for very substantial growth rates in the medium and long run.

We should not be afraid of deflation. We should love it as much as our liberties."