With its coming bailout of homeowners and mortgage lenders, the federal government refortifies its role as daddy for the American people and the people’s role as child-adults who are dependent on their daddy to take care of them.
The bailout, while strengthening the federal government, makes the American people weaker than ever. A people who look to the government for their sustenance and to protect them from their own mistakes and from the adverse vicissitudes of life will inevitably be a weak people.
The economic question is: How long can these paternalistic programs continue? Is the final day of reckoning just being delayed? After all, don’t forget that these programs of unfunded liabilities stretch all the way back to the New Deal in the 1930s. Every few years, a new crisis materializes, only to be jerry-rigged by the feds. Most everyone assumes that the process can go on forever.
Uncle Sam is running out of options to bail out overextended debtors but insists on rushing to the rescue one more time.
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