Nouriel Roubini, the famous economist who long ago predicted the financial meltdown about to occur in the US and who has been right on the money on practically every prediction he has made in the last six or eight years has something to say today about the Fannie Mae and Freddie Mac bailouts.
Perhaps sensibility will sink into some of the so called brightest and best minds, whose hollow shells for brains are in fact filled with nothing but wild ideology, who subscribe to a belief system just as obscene, if not more so than the brutal ideologies of Germany in 1933 and Russia in 1917, and they will finally come around to sanity and realize that socialism indeed works in some segments of a civilized economy, provided it is tempered with incentives for everyone to have the opportunity to exercise initiative and entrepreneurship in a capitalist economy that has a soul.
But I doubt that we have many leaders in our midst who have that kind of insight and ability. Only honest and upright men and women who govern a country can be counted on to look out for the interests for all of the citizens of that country, particularly the least of these among us. And that kind of leadership has sadly been lacking in this country since at least 1980, if not long before then.
What I fear most is that most of our citizens have been indoctrinated with the same kind of ideology since the era of Ronald Reagan, and many of them long before that era. It may be impossible to turn this nation around to honest and sensible government policies, and this country may indeed be a lost cause on the world stage. Without further ado, what follows is part of Mr. Roubini’s rant of the day — although Mr. Roubini seldom rants — since I just took my turn at having mine. And I didn’t even get into the debt we're adding every day by continuing to borrow billions monthly from the Chinese, Saudis, Russians and other world governments. Maybe Moe Blues, who has much more experience in this topic than I do can fill us in on that and more on what we, our children, and their children’s children may have in store in the coming decades.
So now Comrades Bush, Paulson and Bernanke (as originally nicknamed by Willem Buiter) have now turned the USA into the USSRA (the United Socialist State Republic of America). Socialism is indeed alive and well in America; but this is socialism for the rich, the well connected and Wall Street. A socialism where profits are privatized and losses are socialized with the US tax-payer being charged the bill of $300 billion.
This biggest bailout and nationalization in human history comes from the most fanatically and ideologically zealot free-market laissez-faire administration in US history. These are the folks who for years spewed the rhetoric of free markets and cutting down government intervention in economic affairs. But they were so fanatically ideological about free markets that they did not realize that financial and other markets without proper rules, supervision and regulation are like a jungle where greed — untempered by fear of loss or of punishment — leads to credit bubbles and asset bubbles and manias and eventual bust and panics.