Financial Bailout

So, there seems to be a lot of backlash concerning this proposed $700 Billion bailout the government is planning. They say 'let the companies fail' or 'why should we pay for it.' People are saying it is more big government and unnecessary intervention.

People are justified in their anger towards the financial institutions. After all, have we not learned from 1929 and 1989? Have we not learned anything in the last 80 years? It may be that we have learned, but there is one thing that remains constant; greed. It was greed once again that brought Wall Street to its knees.

Are we just going to let these companies fail? Is that was is best? I think the response of the ignorant politicians and citizens is quite ridiculous so far, and believe it or not I think Paulson, Bush, and those trying to solve this problem have it right.

What would happen if we just let the companies fail? Let Wamu and Morgan Stanley disappear. Severely hamper Citigroup and JP Morgan. Destroy the small struggling banks all across the county. Keep fear in the financial markets. Annihilate the faith people have in the financial institutions and financial markets all across the world. If you are worried about a recession, try dealing with a depression. That is what you will get.

What will happen if we just let the companies fail? The FDIC won't have enough funds to cover all the insured deposits. Thousand of people will lose everything they have saved for. Even if they get their money back it may not be for months. What about their mortgage payments? They won't have money to pay the bills, feed their families, drive to work, etc. It isn't just the rich and middle class that will suffer. The poor will lose what jobs they have. Prices will go up and incomes will go down. The government might not have the means to support millions more on welfare. Everyone will suffer, and the poor and middle class often suffer the most.

What will happen if we just let these companies fail? The stock markets around the world will crash. The good companies and the bad will all be tossed aside. Companies will suffer and companies will die. Companies will lay as many people off as they can, or just plain close their doors. People's pensions will be lost, health coverage gone, 401k's destroyed. Social Security will surely fail and all of our retirement plans will be shattered.

Is this what people want when they say 'let these companies fail?' I surely hope they don't. I hope it is just that they don't get it. I hope it is just they are plain ignorant. I hope our leaders are not part of this crowd.

This bailout will cost us all, but far less than the alternative. We must choose bad over worse. Will this mean our taxes will go up? Probably. Is that better than losing everything? Most definitely. We have learned something in the last 80 years. That is, we cannot let our financial markets collapse. Yes, sometimes the majority of people, who's lives are not directly impacted by Wall Street, call for the destruction of greedy companies and crooked executives. Punishment is warranted, but we must look past the vengeance and look to the consequences. We must look to the consequences that their actions will cause if we stand by and do nothing.

Let's think about this. Maybe Paulson and Bush are making the best decision and most important choice government has made in our lifetimes.