Back for More Trouble

I took a few days off and went to the beach, and tried to forget about all of the trouble the economy is in right now. Mostly it worked. That is, until I came back home...

Geithner wants to spend more tax money, this time in an effort to rescue banks from their toxic assets. The plan overview is simple:

1. Let private investors borrow 85% of the money needed to buy these "undervalued" assets (the 85% is taxpayer money)
2. If the markets go up the private investors get the profits
3. If the plan fails (which I believe is likely) taxpayers eat the loss

The philosophical struggle I am having is this: I hate the idea of nationalized health care, which the Obama administration seems very ready to do. However, the same administration seems to be completely opposed to nationalizing banks, which I would prefer to loaning private entities a bunch of risk-free cash. I'm confused!

The other troubling factor is that the toxic asset plan Geithner is proposing is not new. Instead, it is a slightly different version of what Hank Paulson (Bush's Treasury guy) proposed six months ago. And unfortunately, Paulson was an idiot, so the appearance of returning to his schemes is extremely bothersome. Paulson was a Wall Street insider (former investment banker) who heavily favored his old buddies. I was hoping for something better with Geithner.

The bill for all of this? Well, if we allow private investors to borrow up to 85% of their purchases of these toxic assets then the taxpayer is on the hook for another $850 billion. We just doubled down on the stimulus package. Spend, spend, spend.

Thanks for the debt, guys. I really appreciate it. Idiots.