A Philosopher's Blog

Tarping

Posted in Business, Politics by Michael LaBossiere on December 11, 2012
American International Group

American International Group (Photo credit: Wikipedia)

While TARP was controversial and some folks still claim it was a massive failure, the government recently sold off its AIG stock at a nice profit. At this point, the state has gotten back $380 billion of the $418 billion that was distributed through TARP. This is about 90%.

As might be imagined, some people will still be concerned that the government is still about 10% shy of breaking even on TARP. Naturally, it is also worth considering the possible benefits of TARP. After all, if it helped prevent a total meltdown and the state has gotten about 90% of its expenditures back, then it seems like it was a pretty good deal.

Naturally, I expect people to give reasons why TARP was horrible.

 

 

Enhanced by Zemanta
About these ads

10 Responses

Subscribe to comments with RSS.

  1. T. J. Babon said, on December 11, 2012 at 7:17 pm

    I thought TARP was bad by because it was a Bush initiative, and everything Bush did was bad.

    Also, remember the Dem claim that the Bush tax cuts only benefited the wealthy? Now we find out that the middle class benefited from the tax cuts, too. Who knew?

    • Michael LaBossiere said, on December 11, 2012 at 7:50 pm

      When I got my Bush era tax refund, I knew it was benefiting me-at least in the short term. But, there turned out to be a price for cutting taxes while increasing spending. As I deposited the refund, I remember thinking that we’d all pay for this someday.

      • T. J. Babon said, on December 11, 2012 at 8:48 pm

        So how much of the trillion dollar deficit do you think is due to insufficient taxation, and how much to excessive spending?

        • Michael LaBossiere said, on December 11, 2012 at 8:52 pm

          That is an excellent question. In fact, it is the trillion dollar question.

          The easy answer is that taxation should equal the expenditures that we should make as a society. That is, we should pay for what society should provide. The devil, as always, is in the details.

          I would say that there is probably a greater overabundance of spending than an under-abundance of taxation.

          Like most folks, I would rather pay less taxes. But, like most folks, I also like what the state provides (defense, police, fire, roads, schools, and so on).

          To also state the obvious, we need a serious conversation in this country about the matter. Unfortunately, what we mostly get is partisan politics and foolishness.

      • magus71 said, on December 12, 2012 at 8:46 pm

        <<Face-palm…..

  2. T. J. Babson said, on December 12, 2012 at 4:07 am

    Seriously, the big problem with TARP is the idea that certain companies are too important to be allowed to fail. I don’t see much public good in companies that keep their profits in good times and socialize their losses in bad times.

    • WTP said, on December 12, 2012 at 10:07 am

      Isn’t this an example of the corporate welfare that Mike rails against?

    • Michael LaBossiere said, on December 12, 2012 at 3:33 pm

      True-privatizing profit and socializing loss is not a fair system.

      While I am against wealthfare, a case could be made that the state had to intervene to keep the economy from failing worse. Of course, a case can also be made that the companies that failed should have been allowed to collapse into ruin, perhaps dragging the entire world economy into the pit with them.

      You are right to be concerned about “too big to fail.” After all, if a company is so big that its failure can wreck the world, then it is probably too big. From the standpoint of protecting civilization, limiting size could be justified on these grounds.

      It also makes sense to split the traditional banking from the financial gambling to compartmentalize the damage. In general, I favor regulation that is aimed at preventing the economy from being crippled. That seems just as sensible as having laws against traditional crimes that harm society.

  3. Selecting the Right Tarp Size | said, on January 4, 2013 at 3:44 pm

    [...] Tarping (aphilosopher.wordpress.com) [...]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow

Get every new post delivered to your Inbox.

Join 2,018 other followers

%d bloggers like this: