In a speech to a national audience Wednesday evening, President George W. Bush argued the economy is in serious danger and federal government intervention may be required to prevent the country from slipping into major panic.
“We’re in the midst of a serious financial crisis,” he said, and added that without looking towards the omni-present federal government to provide the stimulus that some in Washington believe will fix the nation’s economic woes, the nation may be lead into a “long and painful recession”.
“I’m a strong believer in free enterprise, so my natural instinct is to oppose government intervention. But these are not normal circumstances. The market is not functioning properly. There has been a widespread loss of confidence.”
Treasury Secretary Henry Paulson believes that blowing $700 billion dollars that our government does not have will restore “confidence in the market”.
The Paulson plan would allow the government to purchase debts from financial companies throughout the nation in an attempt to spark those company’s interest in engaging in new business with people. As the deal is debated within Washington, it may expand to cover other areas of our economy – along with much-needed oversight that the original plea from Paulson did not include.
Ken Rockwell of the Mises institute and an avid writer for SmallGovTimes.com and other publications believes the majority of the rhetoric amounts to little more than scare tactics. “I do not believe for one second that if the government fails to nationalize Freddie and Fannie, that the world as we know it will come to an end. Those who are saying that are trying to scare the population, the same as with every other major demand by the regime. It was the same with Nafta, the WTO, the war on terror, the war on bird flu, the nationalization of airport security, and everything else,” he wrote in a recent article.
In a speech before the Joint Economic Committee today, Texas Representative Ron Paul voiced his displeasure with the Paulson proposal and any government intervention. “We risk committing the same errors that prolonged the misery of the Great Depression, namely keeping prices from falling,” he said.
“As with the bailout of airlines in the aftermath of 9/11, those businesses who were the least efficient, least productive, and least concerned with serving consumers are those who will be rewarded for their mismanagement with a government handout, rather than the failure of their company that is proper to the market,” he continued.
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