Update:  We don’t have to accept this just because the Senate passed it.  Michelle Malkin has Operation Hold the Line in effect.

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The Senate passed the huge bailout yesterday, meaning now the House of Representatives will essentially get a second crack at this bill that is so dedicated to converting America to socialism.

Operating under the Jeffersonian rule that more government necessarily produces bad government, this couldn’t be much worse for America.  FDR said the only thing we have to fear is fear itself, and it sounds like the “fear itself” is what is allowing the Democrats to exploit this crisis for expanded government power.

Those who do not learn from history are doomed to repeat it.   We are so forgetful that we have already passed giant bailouts within the past year, they failed to alleviate the crisis, and now we want more.

In other words, we have proof that huge bailouts won’t solve the crisis, and the solution is HUGER bailouts?!

According to Jeff White’s article “Bailout marks Karl Marx’s comeback,” we learned nothing from the Great Depression, either:

The rationale for intervening always seems to centre on the fear of reliving the Great Depression. If we let too many institutions fail because of insolvency, we are being told, there is a risk of a general collapse of financial markets, with the subsequent drying up of credit and the catastrophic effects this would have on all sectors of production. This opinion, shared by Ben Bernanke, Henry Paulson and most of the right-wing political and financial establishments, is based on Milton Friedman’s thesis that the Fed aggravated the Depression by not pumping enough money into the financial system following the market crash of 1929.

…
Friedman — who, contrary to popular perception, was not a foe of monetary inflation, but simply wanted to keep it under better control in normal circumstances — was wrong about the Fed not intervening during the Depression. It tried repeatedly to inflate but credit still went down for various reasons.

Some government officials are trying to assuage fears about government takeover of all this capital by explaining these investments might actually make the government money in the long-term.

I don’t care.  The government has a bad record on “what it makes money on.”  The more jobs you create, the more payroll taxes the government earns.  It makes money from obscure fees and unnecessary DNR fishing licenses.  Heck, the government can print money whenever it wants.

We’re already living under some of the principles of Marxism.

In his Communist Manifesto, published in 1848, Karl Marx proposed 10 measures to be implemented after the proletariat takes power, with the aim of centralizing all instruments of production in the hands of the state. Proposal Number Five was to bring about the “centralization of credit in the banks of the state, by means of a national bank with state capital and an exclusive monopoly.”

If he were to rise from the dead today, Marx might be delighted to discover that most economists and financial commentators, including many who claim to favour the free market, agree with him.

The U.S. already adheres to at least two other tenets of Marxism:  the progressive income tax and free public education for all children.

Just because the conversion happens slowly doesn’t mean it’s not happening.  Democrats are even talking about this massive buildup of government power by saying it includes tax breaks for the middle class, or something like that.  They love talking about those tax breaks because it sounds like they’re not supporting burdensome taxation.

Artificial prices and a government emphasis on homeownership contributed to this crisis.  Will throwing more money at the problem help?

As Friedrich Hayek wrote in 1932, “Instead of furthering the inevitable liquidation of the maladjustments brought about by the boom during the last three years, all conceivable means have been used to prevent that readjustment from taking place; and one of these means, which has been repeatedly tried though without success, from the earliest to the most recent stages of depression, has been this deliberate policy of credit expansion. … To combat the depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about …”

The confusion of Chicago school economics on monetary issues is so profound as to lead its adherents today to support the largest government grab of private capital in world history. By adding their voices to those on the left, these confused free-marketeers are not helping to “save capitalism”, but contributing to its destruction.

The reason busts happen after booms is because prices and credit can’t be sustained.  The government stepping in and throwing in a liferaft artificially inflates prices and credit instead of allowing them to bottom out and correct itself.

When we’re still in a financial crisis even after this bill is passed, don’t say I didn’t warn you.

By the way, if you believe in the principle that power corrupts, how could you be for this bill?  For curiosity, I looked up the Decline of the Roman Empire and found this (bolds added):

Historian Michael Rostovtzeff and economist Ludwig von Mises both argued that unsound economic policies played a key role in the impoverishment and decay of the Roman Empire. According to them, by the 2nd century A.D., the Roman Empire had developed a complex market economy in which trade was relatively free. Tariffs were low and laws controlling the prices of foodstuffs and other commodities had little impact because they did not fix the prices significantly below their market levels. After the 3rd century, however, debasement of the currency (i.e., the minting of coins with diminishing content of gold, silver, and bronze) led to inflation. The price control laws then resulted in prices that were significantly below their free-market equilibrium levels.

According to Rostovtzeff and Mises, artificially low prices led to the scarcity of foodstuffs, particularly in cities, whose inhabitants depended on trade in order to obtain them. Despite laws passed to prevent migration from the cities to the countryside, urban areas gradually became depopulated and many Roman citizens abandoned their specialized trades in order to practice subsistence agriculture. This, coupled with increasingly oppressive and arbitrary taxation, led to a severe net decrease in trade, technical innovation, and the overall wealth of the empire.

What does that sound like?

Those who do not learn from history are doomed to repeat it.

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