After Thaddeus disappointing me this week, I have to say I'm a little disappointed in myself for being less than active here over the last few weeks. The Thanksgiving holiday, illness, and other excuses come to mind... but, it's time to get back to business here and help readers in their resistance to government- and media-induced soma consumption.
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Tonight, Nicole and I attended our first Libertarian Party event here in Indianapolis. We saw LP VP candidate, Wayne Allyn Root, speak at a dinner at the Rathskeller, a great German restaurant and bar downtown. Mr. Root gave a pretty good speech discussing libertarianism, the Libertarian Party, Barack Obama, and bailouts. It was no secret that he has already begun his campaign to become the LP candidate for President in 2012. I like Root; I'm not sure how well he'll fare, but he brings charisma to a party that desperately needs it. At times, I fear he has too much charisma and comes across as a used car salesman.
Aside from the speech, the evening went pretty well. I am still struggling with the destination (if any) of my political affiliation. At another time down the road, I will address this topic in more detail. In the meantime, I plan on assisting the local LP and keeping my options open.
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As I type right now, I am watching the replay of the hearing before the House Financial Services Committee earlier this week (December 10). This week's hearing starred Gene Dodaro, acting Comptroller General, and Neel Kashkari, Interim Assistant Secretary of the Treasury for Financial Stability (fit that on a business card!). Kashkari received most of the questions as he has been responsible for administering the $700B bailout under the EESA/TARP legislation. This is a popular topic.
It amazes me, at least on some level, that the members of the committee are so surprised with the program to-date. Question upon question indicate a level of shock and disappointment with the use of funds under the program. But, at the end of the day, under the legislation, there was little or no direction given nor strict oversight required in the use of funds. There are complaints that the banks are hoarding money, or using the funds "inappropriately" - what?! The legislation gave almost complete and unilateral power to the Treasury Department. Now that they have acted upon such authority, Congress is grandstanding that they are not doing what they are "supposed" to be doing. Perhaps they should have spent a little more time crafting the legislation rather than giving in to Paulson's threats of martial law. Or, perhaps they should have voted against the legislation! I guess I'm not really that amazed...
On a side note, I have to give some props to Kashkari for his ability to answer questions like a first-rate politician... "Thank you, Congressman, for that question", "I appreciate your feedback, we take it very seriously"... he bobs and weaves with the best of them.
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That leads me to the auto bailout. Congress, the White House, and the incoming administration need to wake up and recognize that they cannot solve this problem with legislation. They cannot solve this problem with bad loans. I truly feel bad for those who have made their livelihood in the auto industry - or, even worse, bet their futures and retirements based on the vitality of the auto industry. But, these companies need to fail. The supply chain may need to fail. Voids will be filled. Life will go on. Time heals wounds. There is not an easy answer to this issue.
I found this article at mises.org which discusses the demise of the piano industry in the United States. It is not terribly analytical nor deeply rooted in economics, but it tells a good story that I feel is very relevant as we consider the auto industry.
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Finally, I'd like to (again) highlight some upcoming work that I will be posting on this blog. I'm getting closer in some of the analysis and think that I'll be able to begin providing some of it this week. My first series of articles will be a review of the financial markets, specifically the credit crisis and the effect of the EESA/TARP legislation.
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