Bailout Insanity Continues

The sky’s the limit when it comes to government “stimulus” as per the Obama transition team.  Deficits?  That will have to wait.  There are ”jobs” to create:

A top economic adviser to President-elect Barack Obama said on Monday a U.S. economic stimulus program to revive economic activity would need to be bigger than first thought as the financial storm intensifies.

“We don’t have the exact number,” Austan Goolsbee said on CNBC television. “In the campaign he (Obama) was talking about $175 billion. The economy’s gotten substantially worse so we know it’ll be bigger than that.”

Meanwhile, the bailout insanity continues:

• Citigroup is getting an additional $20 billion in equity from the US Treasury (the Treasury purchased equity stakes in the biggest banks, including Citigroup for $25 billion, last month as part of the TARP) plus a Federal bailout on over $306 billion in toxic mortgage assets:

Terms of the asset guarantees mean Citigroup will cover the first $29 billion of pretax losses from the $306 billion pool, in addition to any reserves it already has set aside. After that, the government covers 90 percent of the losses, with Citigroup covering the rest from assets that include leveraged loans and so-called structured investment vehicles.

• Home builders are getting in line for their own bailout.  Somewhere in the neighborhood of $250 billion dollars:

The builders’ lobby is ramping up its sales pitch for a $250 billion stimulus package called “Fix Housing First,” arguing that financial markets won’t recover until home prices stop falling. They are calling for a generous tax credit for home purchases and a federal subsidy that would lower a homeowner’s mortgage rate.

• The ski industry is asking why it hasn’t been invited to the bailout party, becasue we just can’t go without our skiing vacations.  The industry’s concerns?  Global warming (so we can get more snow and people will continue to ski), immigration reform (so it can hire more cheap labor during the peak seasons) and economic “stimulus” (which allows people to afford more skiing vacations).

The deluge of government bailouts is obviously encouraging more fiscally irresponsible players to  hold their hands out, begging for money…OUR money.  Fiscal conservatism cannot be revived fast enough.  It is getting to the point of being embarrassing.  Government programs and entitlements have tallied in the trillions of dollars over the last 70 years, and the problems these programs were meant to eradicate have gotten worse.   New Deal policies and government handouts do not work, they only encourage failure.  And with President-elect Obama and a liberal Congress, government will be overreaching again.  As per Sean Paige:

The old American ideals of limited government and self-reliance are slumbering, if not dead. And that’s an alarming development, since American presidents aren’t meant to have such powers. The stage is set for either a dangerous (and possibly unconstitutional) expansion of executive branch powers (here there really may be a parallel with FDR) , or, more likely, an upsurge of dismay and disappointment (maybe even rage) when it becomes clear that the next president isn’t a super-hero or a saint, but a human being, with a limited capacity to deliver all that’s promised.

This is the logical result of American political campaigns that have devolved into little more than a litany of expensive and unrealistic promises, about what Washington will do for you, do for us, when this person or that party is in charge. Neither candidate can win if he or she acknowledges the limitations of the office, or of Washington’s capacity to cure all ills. So they spend the campaign writing checks they can’t cash.

The presidency is a potent office; but no president does or should have the power to do all the things Barack Obama is saying he’ll do; it’s contrary to the system of limited government and checks and balances the founders handed down to us. And the sooner Obama acknowledges those limitations, the better off he and we will be — since anyone who sets himself on such a high pedestal is bound to take a long and terrible fall.

 OTHERS

Malkin on Citigroup

WSJ’s Deal Journal

Allahpundit

Explore posts in the same categories: Government Bailouts

Tags: Barack Obama, Citigroup bailout, economic stimulus, Government Bailouts, homebuilder bailout, New Deal

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