Saturday, September 27, 2008

Bailout Prevents Great Depression 2.0

In a commentary on the National Review website, Newt Gingrich shows great skepticism toward the Mother of All Bailouts, advising that Congress "had better ask a lot of questions before it shifts this much burden to the taxpayer and shifts this much power to a Washington bureaucracy." He also presents several other actions government could take: 1) suspend the mark-to-market accounting rule; 2) repeal the Sarbanes-Oxley law; 3) eliminate the capital-gains tax; 4) undertake an "all of the above" energy plan to keep at home $500 billion of the $700 billion we currently send overseas for imported energy.

Count me as "all of the above" for Gingrich's ideas. (Toss in a corporate tax cut while you're at it.) But what would have been a smart, free-market plan in August 2007 or March of this year isn't enough for right now. Just as government created the environment for the credit crisis, it failed to enact quick solutions. The situation has gone critical. It's time for shock and awe.

From: Bailout Prevents Great Depression 2.0 by James Pethokoukis

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