Barney Frank has never run a business in his life. He's never had to create a desirable product or spitshine a service that attracted customers to it. He's a lifelong politician, from the moment he emerged from Harvard in the 1960's. Regarding AIG, he says that "it's time for us to take over the company." Frank wants the government, which thanks to the $170 billion bailout issued to AIG last fall has an 80 percent stake in the company, to assert its ownership rights. There are a few problems with that:- When the government has "ownership" in a company, it writes legislation that protects that company - until it becomes a monopoly in its industry. It uses taxpayer dollars to prop up the company when it fails to make money. Fannie and Freddie are stellar examples of this very problem. How solvent are they?
- Very, very few politicians have a track record in succeeding at business. Most are lawyers (government is all about law, after all) and have no idea how to succeed at banking, retail, insurance, etc.
- The more businesses they "take over," the more businesses they're likely to "take over." See Venezuela.
This whole purported outrage over AIG in Washington is a deflection. It's an attempt to get people to ignore how politicians greased the skids for what's happening right now. Fannie and Freddie started this mess by giving out bad loans and ballooning the housing market, AIG was given money by Bush and Congress, and Obama and Congress want to continue this doomed-to-failure enterprise of government meddling in private business.I don't want Barney Frank taking over anything. He hasn't proved himself to be competent at anything. Nor has he proven to act transparently, honestly, or in the best interests of the American people. Instead, he's excited for acquiring more power in this great experiment of his and his comrades in DC. That's where our anger ought to be placed, and not at AIG. Big deal. If the company fails, it fails. Let it go bankrupt. Let it fold, if necessary. Let its competitors step in and take care of its customers. That's healthy. Throwing taxpayer dollars at a failed business is not healthy. But the more that Barney Frank and his comrades convince you that you own the company, the more likely they are to take this insurer and nationlize it with your blessing. And what do you think that will lead to? ETC: King Barney, where everything he touches turns to debt.  |
