The Libertarian Party of Pennsylvania - Forum

I called Tim Holden's office to day and requested that the bailout be shot down! I also commented that prosecutions need to occur all the way up to the federal reserve!

I got this email today.  I think it captures the essence of bailout with just the right degrees of ridicule and sarcasm. 

Mark

---------------------------

Dear American, 

I need to ask you to support an urgent secret business relationship with a transfer of funds of great magnitude.

I am Ministry of the Treasury of the Republic of America. My country has had crisis that has caused the need for large transfer of funds of 800 billion dollars US. If you would assist me in this transfer, it would be most profitable to you.

I am working with Mr. Phil Gramm, lobbyist for UBS, who will be my replacement as Ministry of the Treasury in January. As a Senator, you may know him as the leader of the American banking deregulation movement in the 1990s. This transactin is 100% safe.

This is a matter of great urgency. We need a blank check. We need the funds as quickly as possible. We cannot directly transfer these funds in the names of our close friends because we are constantly under surveillance. My family lawyer advised me that I should look for a reliable and trustworthy person who will act as a next of kin so the funds can be transferred.

Please reply with all of your bank account, IRA, and college fund account numbers and those of your children and grandchildren to wallstreetbailout@treasury.gov so that we may transfer your commission for this transaction. After I receive that information, I will respond with detailed information about safeguards that will be used to protect the funds.

Yours Faithfully

Minister of Treasury Paulson

Here's another recent email attributed to an economics professor (I did not check this).  This, too, seems to summarize the state of taxation in the US today in terms many can understand.

Mark

-------------------------------

Bar Stool Economics

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. 'Since you are all such good customers, he said, 'I'm going to reduce the cost of your daily beer by $20. Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?' They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now paid $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

'I only got a dollar out of the $20, declared the sixth man. He pointed to the tenth man,' but he got $10!'

'Yeah, that's right', exclaimed the fifth man. 'I only saved a dollar, too. It's unfair that he got ten times more than I!'

'That's true!!' shouted the seventh man. 'Why should he get $10 back when I got only two? The wealthy get all the breaks!'

'Wait a minute,' yelled the first four men in unison. 'We didn't get anything at all. The system exploits the poor!'

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics, University of Georgia

Bill Steigerwald of the Pittsburgh Trib interviewed Ron Paul about the bailout.  The brief interview is on-line.

Mark

http://www.pittsburghlive.com/x/pittsburghtrib/opinion/s_590327.html

I'm delighted that the Democrat bill didn't pass.  As it turned out, it wasn't very "bi-partisan", as made clear by Pelosi's speech before the vote.

The Republican Study Group has come up with a decent alternative which many Libertarians can support:

http://www.talkingpointsmemo.com/docs/RSC-Alternative-bailout-Plan/

I read last evening in some blog that the bailout (Troubled Asset Relief Act or Emergency Economic Stabilization Act or whatever it's called when passed by the Senate) has a particular global implication. Unfortnately I can't find the link and I'm going from memory here, so take what I write with a grain of salt.  This needs to be confirmed.

Here's the issue.  Banks with branches in both the US and other countries can transfer their troubled assets to one of their US banks.  Bad assets could be concentrated in that bank.  Once here they are eligible for purchase by the Treasury.  Thus, the US Treasury might be buying bad assets worldwide.  The taxpayer could be paying for bad assets from all over the world.  And I thought being the world's policeman was bad.

If anyone finds confirmation of this, please post it. 

Mark

These are a bunch of youtubes out on that very subject. I just did a quick search and this short video was the first one that came up

http://www.youtube.com/watch?v=7i5ozAhwnlw