Socialist ideologists just don't get it

The Federal Reserve has injected (loaned) dollars to provide liquidity for our economic system. That is not a bailout of corporations. It has nothing to do with businesses directly but provides funds to banking institutions that will be expected to make loans to corporations as needed.

The low liquidity was a result of a “drying up” of loan money because of the implosion of the market for sub-prime mortgages made during the time when interest rates were low (the Fed kept the discount rate too low for too long). Those lenders who now find themselves with “bad” mortgage loans should take their losses and maybe next time they will be more prudent.

It is appropriate for the government to intervene to avoid economic havoc which could lead to a recession or depression. The poor suffer the most during economic downturns. Economists generally agree that adding liquidity when the stock market crashed in 1987 prevented a serious disaster. The situation today is somewhat similar.

This is not using tax dollars to bail anyone out!

Business is what provides jobs and a living for the “poor” and it is very important that a recession be avoided in their best interest.

It is not a zero sum game whereby if someone gets rich others are poorer. In fact, it is just the opposite. When the more enterprising people create businesses and get rich, they create jobs for others; thereby, everyone is better off. It seems that those with a socialist mentality cannot understand that.

Statistics show that with the Bush tax cuts the highest one percent of taxpayers paid 35.7 percent of income taxes in 2004 with the top marginal rate at 35 percent, whereas they paid only 19 percent in 1980 when the top rate was 70 percent. The same relationship occurs when applied to the top five percent of taxpayers (56.2 percent versus 37 percent). (Data published in the August 24 Wall St. Journal.)

The best way to help the poor is to have a robust economy.

The socialist ideologists just don’t get it.

Glen Holzhausen