Canada's CERB and CECRA have been doing wonders to keep ordinary people either afloat or employed, trickling up to small businesses all over.
(I don't mind your plan either, but it involves more per-company hand-holding than simply giving out generous unemployment and employment-support benefits)
Not saying he wouldn't have also signed the acts but the crisis was well underway by the time Obama was in the White House.
Why reward people who gambled and lost? Bust them out.
People will either buy the houses at more reasonable prices or (more likely in this case) the banks will renegotiate more reasonable terms with the original mortgage holders because they have too much supply and no buyers.
> instead of pouring money into banks and letting people suffer. Thanks, Obama.
That wasn't possible as liquidity also died. Solvent businesses couldn't give people paychecks because the banks had no cash. You had to bail the banks.
HOWEVER, what needed to happen was that the bank investors needed to get busted out. That was where Obama went wrong.
Why reward corporations and investors who gambled and lost? Bust them out.
>People will either buy the houses at more reasonable prices or (more likely in this case) the banks will renegotiate more reasonable terms with the original mortgage holders because they have too much supply and no buyers.
Other companies will buy the businesses at more reasonable prices or (more likely in this case) the banks will renegotiate more reasonable terms with the original mortgage holders because they have too much supply and no buyers.
And this was the issue with the 2008 fiasco. The government chose to save large financial institutions instead of breaking them up so the problems would be less likely to happen again. They chose to save large corporations over homeowners.
It is happening now with the pandemic response. I get the federal government wanted to dump a ton of money into the economy through PPP, but man, you cannot tell me the Catholic Church needed it. They are sitting on assets worth billions they could have sold/borrowed against to stay afloat. Same with large private educational institutions and public corporations.
The next round, and there will be a next round, will be more of the same. Carve outs will be rampant.
The USA should have looked at other countries providing direct income replacement to citizens. 70% income replacement sent to citizens and not force them through state's unemployment processes. Other countries did this and it worked.
Um, exactly?
As I said, the bank investors should have gotten wiped out.
The worst part is that a bank is probably the single business type that the Federal government can actually replace on a short timescale.
But it's often not a choice between letting entire swaths of our economy collapse, and dumping absurd amounts of our tax dollars to prop up these poorly-run companies. We can give them loans with strings attached, force them to go through bankruptcy, wipe out the shareholders but preserve the structure of the company, bail them out but subject the industry to much greater regulatory scrutiny, etc.
Personally, I wish we had a straightforward way to bail out a company and have the U.S. government take ownership in the company until the stake can be safely unwound, or the too-big-to-fail company can be broken up. Theoretically, with a controlling stake and the corresponding board seats, you could force out the lousy management that didn't take adequate precautions as well.
It'd kind of be socialism-esque nationalization of industries with extra steps, but Japan has been doing a similar-style thing since the 90s, and I can't imagine it would be any worse than the relatively strings-free bailouts we've seen, or the collateral damage and runaway collapse that would occur from letting a monstrous chunk of the economy fail all at once.