So Obama took the podium today to talk about the Chrysler bankruptcy announcement. CNN writes:
The president also blasted a group of investment funds and hedge funds for holding out for an “unjustified taxpayer bailout.”
Several financial institutions, led by J.P. Morgan, agreed to reduce Chrysler’s loan repayment obligations by as much as two-thirds, Obama said.
But “a group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout” Obama said. “They were hoping that everybody else would make sacrifices and they would have to make none.”
Heyyyy, welcome to the real world, buddy! Why should they take the risk if you’ve made it quite clear you’re willing to have everyone else (e.g., the taxpayers) assume the risk. This is exactly what fiscally conservative folks were predicting would happen. Once you make it clear that the government’s going to step in and bail people out, there’s no reason for private investors to bail themselves out. They’ll just wait for Uncle Sam’s tit to be presented and suck it dry.
If Obama and his predecessor weren’t both so completely ridiculously stupid when it comes to economic realities (and the human/social realities that go with that), then this could all be avoided. Instead, they both set a precedent of “you don’t have to actually TRY to succeed, we’ll bail you out with taxpayer funds if it gets too bad”, and now you and I, the taxpayers, foot the bill.