Wednesday, October 01, 2008

Hamilton's beats Jefferson!

With today's manufacturing numbers, it looks like the credit freeze is a stop, breath, and think response to changing reality and not something as easily addressed as a panic. So why assume that international banks, once their balance sheets are generously shored up, will jeopardize their second chance at life with shaky loans to companies doing business in the United States?

The solution is obvious: rather than giving money to banks in the hope that they will lend money to United States consumers and industry, the TARP should lend money directly to consumers and domestic industries. The original Paulson plan would have allowed this, but the modified Paulson plan will be an ineffective solution to an already ever-expanding problem. In two short months, the Chinese and Russian State capitalist systems have gone from historical curiosities to role models: the American gift has always been assimilation and improvement, so let's hope we can out-do them!

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