Let’s start adding things up. The war has cost somewhere between $600 billion and $3 trillion depending on whether you find the administration or Joseph Stigletz, the Nobel economist, more credible. The Bear Stearns bailout was accomplished by the Federal Reserve using Great Depression procedures of the 1930’s. The cost was reported to be around $30 billion. The Los Angeles Times reports additional commitments:
[We are] committed to investing up to as much as $200 billion in preferred stock of the loss-plagued finance giants Fannie Mae and Freddie Mac and at least $5 billion in their mortgage securities; and agreed to provide an emergency loan of $85 billion to American International Group Inc. in return for an ownership stake of as much as 80 percent in the stricken insurance giant.
That brings the total over $300 billion so far this year. There are still several institutions that will require help, so the total will inevitably climb.
As our commitment to saving the advocates of lower taxes and free markets continues we will approach a total near the administration’s estimate of the cost of the Iraq War. The war has been a well documented drain on our financial system and has greatly impacted our national debt. We are in a short period of time undertaking to double that amount of debt.
McCain and his camp, icons of deregulation, are now piously advocating for regulation. This is madness! McCain, like Bush on the war, does not feel the slightest sense of owing us an explanation. What was he thinking in giving free rein to financial institutions? What was he thinking while he was telling us over the last year that there was no serious problem? Now without any explanation he is trying to sound like a reformer of the system he created.
Remember McCain advocates a substantial increase in the budget for defense spending and reducing revenue through reducing taxes. His foreign policy calls for spending the defense budget on greater military activity.
How can he do anything but drive us deeper into debt? I understand that this has to do with securing petroleum assets but is this the best way to proceed?