[...] “Who’s Afraid of the Big Bad Bailout?” wonders [...]

Well I’m not for the bailout/rescue. Yes, bad things will happen. Bad things will happen with or without it, but I don’t believe the world will fall apart, it will just go through pain, like a really bad hangover.
Problem #1, is that we are too dependant on debt and too accustomed to 0% down. Whatever happened to saving? Layway?
Problem #2, is there $700 billion under the Congress’ couch cushions? Where is that money going to come from? How is social security and medicare and other social programs going to be funded? We can probably forget about any tax breaks for the middle class while we’re at it.
Problem #3, related to #2. Say the government taxes us and sells of several billion US bonds to China and Saudi Arabia, do you feel any better? Does this make the problem less worse?

Google “Stock Market History Chart” and look at 1929-1950 for Dow Jones. We didn’t have the safeguards that we have today. Mortgages were ballon payments, and the 30 year fixed was not a given. There was no Internet. Women had fewer options. We can survive whatever life throws at us provided we can get over our addictions to credit and oil.

As a mortgage-holder and taxpayer I am as angry as anyone. I am especially annoyed with the master of the universe syndrome that we have seen in the now-defunct investment banking industry.

But I believe the downward spiral scenario we have been given is real and THAT is what will hit Main Street in the face much harder than most Americans suspect. After all, this is a free-market Administration telling us that a market-engineering bail-out strategy is the best option to stave off an imminent and severe credit crunch across the US. They must be scared sh#&less to propose such an un-Republican plan.

The stock market is just an indicator – it’s not about that. And it’s not really about credit for Joe and Mary Anyperson, although that comes into it too. It is more about short-term and long-term credit for businesses (our employers), which is like grease in the wheels. If banks are afraid to lend money, then small and large businesses will literally start laying people off and shutting down operations when they cannot get regular credit to pay their everyday bills (as they wait for customer payments.) Not to mention lending for growth and investment. Suppliers of vital parts, wholesale goods and business services will start demanding cash up front before delivering to the corner store or factory, if they fear the bills will not be paid. This means they will sell less, and their businesses will suffer too.

My family will probably be okay. But what about all the people aged 50+ whose retirement incomes and assets are falling? What about those who are already struggling and without health insurance? It’s easy to say now that “we survived” the 1930s when “we” weren’t there to see the struggles that forever marked a generation of people (while many of the worried retirees actually were there.)

Putting it in perspective, while $850 billion will add a certain percentage to the national debt, it is just a portion of this country’s annual output. We’ll have to suck it up and pay it off. Or maybe we’ll get lucky and those bad assets being purchased on our behalf will turn out to be worth something some day. I’d rather take that risk than the one of doing nothing at all, or not in time. The Paulsson/Congressional plan may not be perfect, but nothing ever will be.

Well, if you stuck with me this far, thanks for letting me ramble.

Mari,

I think you are spot on. Congress right now is guilty of what a lot of Americans are…once you’re in the financial hole, why not just pile more debt on? At this point, they must be planning on paying for all of this with Monopoly money.

But, on the other hand…I’m not sure we have a choice. Both the current administration and Congress have so discredited themselves that it’s hard to know what to believe. Just because they’ve cried wolf before doesn’t mean there isn’t a wolf there now.

Allison, I agree with you that if Republicans are voting for it, we must be in deep sh*t. It just makes me *really* mad that the key to getting them to sign it was to spend more money. And I feel incredibly sorry for anyone who was just about to retire and now can’t. It’s completely inexcusable, what was allowed to happen, and a lot of innocent people are going to pay for it – literally – one way or the other.

Thanks to both of you for your thoughtful comments!

Mari,

I forgot to say that you made some good points about how different things are now from right before the Great Depression. I am very slightly in favor of the bailout – say, 60-40 – so I really appreciate your point of view.

Thanks again for stopping by!