More Government Less Liberty
July 20, 2010
Usually I attempt to avoid national issues in this campaign, but another story has hit the financial markets that I need to discuss. This story actually filters into the local and state political arena. A simple example is municipalities prohibiting private liquor stores within their city and then building a liquor store to meet demand.
Apparently Uncle Sam learned no economic realities in the last two plus years. Here GM, 61% government owned, is purchasing a finance company with capital (not sure where the capital came from, but ultimately from taxpayers) to secure automobile credit for credit risky customers. The first problem is GM controlling more of the private market; the second problem is that GM will distort market sales demand in the auto industry by lowering the privately established credit levels for consumer qualifications.
This is exactly what Congress did to Fannie May and Freddy Mac in the housing market eight years ago, and the housing market burst. Economics 101 provides a natural ebb and flow of varying sales levels, good years and lean years, a Biblical principle established by our creator. Having government step in and alter that natural cycle is a disaster waiting to happen.