Re:Rewarding Neglect and Punishing Investment in Struggling ...
by omegaworks on Saturday March 16, 2019 @01:32AM
(#19406508)
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The solution is to keep those people in the hot seat, and put in a couple of new rules?
Absolutely not. I believe that executives at some of these institutions should have been held criminally liable for fraud. I also believe that people with the least amount of power shouldn't be the ones to take a haircut.
You're focused on the moral hazard of bailing out the pension system, but what about the moral hazard of promising a stable retirement income to working class people, signing a contract to that effect, and just having it disappear.
What does that say about the social contract between businesses and their employees, that a corporation or government be able to make a promise and not keep it?
Who faces the consequences then?
I am? When did I do that? It is none of my business what happens. I'm not advocating anything to do with pensions.
I'm just pointing out that printing money is a tax, not an immediate death sentence to the currency.
> After the bailout, the banks swallowed new regulatory burdens, new capitalization requirements, effective caps on their size and interdependence.
So we've got a class of people who were trusted with vast amounts of power, and they mucked it up and destroyed a bunch of wealth.
The solution is to keep those people in the hot seat, and put in a couple of new rules?
That isn't a sensible response. When people muck up at that magnitude, they should go broke and be ejected from positions of financial power. Let someone else step up and try being in charge. Cushion the blow on households, sure, but the institutions should not be propped up. Change the rules too if that makes sense, but the important thing is to try out new people.