The same [Republican] politicians who guffaw at the idea of effective government have installed a regime in which incompetence is the rule. Nor will the country easily shake off the consequences of deliberate misgovernment through the usual election remedies.The idea that conservatives run up the deficit, sell of parts of the government, and run things into the ground. It sounds a bit cynical, but interesting.
Thinking about the latest fiasco: the global credit crunch. Look at the proposed solution. $700B of taxpayer money - to buy the toxic assets.
First, this is a great moral hazard - it lets the lenders off the hook for bad loans. Additionally, it completely bypasses any notion of individual responsibility - a staple of the Republican slogan.
Second, the issue with the assets is that nobody knows what they're worth. Republicans (and many other people), think the government is incompetent. So, why would Paulson want the government to take these over? An incompetent government is guaranteed to screw up pricing and selling these assets - so it's guaranteed to hurt the government. And, seriously, if the smartest folks at the biggest banks can't figure the value of these assets - how are some government number crunchers going to do it?
Third, buying the assets is completely reckless. It's guaranteed to fail - with no way to know the right price, the government is either over paying (losing tons of money) or under paying (screwing up the bailout). So Paulson was setting the government up to fail - even under the best of conditions.
Fourth, the original plan had no safeguards to preserve the taxpayers money.
Fifth, with all the hype about "socialism" and "fiscal responsibility" and "welfare" - this was (is) an obvious and direct redistribution of the money from the people to the financial institutions. It still boggles the mind that nobody talks about that.
So, with all these things (and others I'm sure I'm forgetting), Paulson (and the Bush administration), was putting forward a plan - trying to ram-rod it down our throats, that was guaranteed to weaken the government, and was poorly thought out. It was the epitomy of the horrible governing they always rail against.
I'm glad they're out of the office - it can't be soon enough.