Tuesday, March 31, 2009
The staggering spectacle of a sitting President effectively firing the CEO of a private company heralds the beginning of a new phase in the government takeover of free enterprise, according to shocked economic observers.
Obama’s decision to send GM CEO Rick Wagoner packing on Sunday afternoon stunned a previously buoyant stock market into a 250 point drop on Monday as traders struggled to digest the unprecedented move.
This is just the latest expansion of Obama and his administration’s power grab, using the economic crisis created by the central bankers that pull their strings as an excuse to pose as the saviors while completely sinking any chances of a real recovery by not allowing incompetent banks and corporations to fail.
“Remember, as bad as Wagoner’s performance has been over the years, it was the federal government — not shareholders or the board of directors — that threw him under the bus,” points out CNBC’s Larry Kudlow.
Sen. Bob Corker, who argued in favor of a government bailout of GM, called the Wagoner firing “a major power-grab by the White House on the heels of another power-grab from Secretary Geithner, who asked last week for the freedom to decide on his own which companies are ‘systemically’ important to our country and worthy of taxpayer investment, and which are not.”
He added that the move represents “a marked departure from the past,” “truly breathtaking,” and something that “should send a chill through all Americans who believe in free enterprise.”
Financial blogger Jeff Schreiber was similarly flabbergasted at the move, noting that the Democrats have taken the Republican’s murder of the economy and turned it into a “killing spree”.
“Today, the CEO of General Motors was fired. Tomorrow, will it be Chrysler? Will it be a bank? A retailer? A small business? Even worse, what of the effects upon individual workers who now find themselves, albeit unwillingly, under the government umbrella?” he writes.
Kudlow highlights the fact that the bailout has everything to do with regulation and centralizing control, and little to do with actually laying the foundation for an economic recovery.
“The big bankers say they are profitable. And with an upward-sloping Treasury yield curve and some market-to-market accounting reform coming from the Financial Accounting Standards Board (FASB), the outlook for banks should be getting better, not worse,” he writes. “So why is the Treasury jamming more TARP money down bankers’ throats, especially after announcing a new plan to use private capital to clean up bank balance sheets and solve the toxic-asset problem?”
“It kinda sounds like the Treasury doesn’t want to let go of its new uber-regulator status,” he concludes.
As we have exhaustively reiterated – the bailouts have nothing to do with providing the means for real economic recovery – they are simply the avenue by which the state is seizing complete control over private enterprise. That is why the Obama administration is demanding banks and companies accept more TARP money even if they don’t need or want it.
The Democrats have mimicked the Bush administration’s fearmongering about the war on terror and applied it to the economic crisis, making dire apocalyptic proclamations and guaranteeing they will happen if Congress and the American people don’t support every instance of government intervention.
In league with Bernanke, Geithner, and Paulson before him, they have also used intimidation and bullying tactics, threatening that martial law will be introduced in the U.S. unless lawmakers get with the program and fast-track every power-grabbing measure.
Meanwhile, every single government action has either had no effect or made the situation worse. Before the recent bounce, which is already losing steam, the Dow Jones had lost over 1600 points from the time of Obama’s inauguration to its low on March 9.
In reality, as Ron Paul, Peter Schiff and numerous others have stressed, the only thing that will turn the crisis around is if the government gets its nose out of the business of private enterprise, stops using taxpayer money to prop up zombie organizations, and allows competent banks and companies to pick up the pieces and set an example for a true and sustained recovery.
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