Last night, the Senate voted overwhelmingly to pass the $700 billion bailout bill. After reading the 400+ pages that were crammed with enough pork to make Jimmy Dean look like a vegetarian, they decided to go ahead and sell American freedom to such important interests as Wool Research (Section 325), Auto Race Tracks (Section 317), TV and Film Production (Section 502), and Wooden Arrows Designed for Use by Children (Section 503). Tonight, the House of Representatives will vote on the pork-laiden bill.
The stock market is showing us how it feels about the bill: before Monday’s Senate vote, the Dow Jones Industrial Average was down 100 points in the first hour, and 300 points by 1:30, ending the day around 700 points down from the previous close. The House killed the bill, and the next day the markets started to recover. After the Senate approved the bill last night, Wall Street reacted by shedding another 300+ points as of this writing. Wall Street is voting with their wallets: they are afraid of the economic impact of the bill, and the stock prices show it. Hardest hit are luxury goods manufacturers like Apple (-8%), gas & oil exploration companies like EOG Resources (-12%), and raw goods companies like BHP Billiton (metal mining, -10%) and Nucor (steel recycling, -11%). The message from Wall Street is that as the economy slows, people won’t be buying iPods, the demand for gasoline will go down as people lose their jobs or just drive less to save money, and since people are consuming less, the need for metals to make new goods goes down as well.
Rather than allow the bad companies to fail and allow the market to correct itself, Washington has decided to get involved under the pretense of “saving the economy.” As has become typical in Washington, they are doing it by spending money. Taxpayer money. Our money. And, like every other form of government “assistance” — welfare, Medicare, Medicaid, Social Security — it has only served to make those problems worse, rather than better.
The passage of this bailout bill will pave the way toward centralization of the banks and industry. This is one of the key tenants of Marxism: Karl Marx’s Proposal Number Five argued for the “centralization of credit in the banks of the state, by means of a national bank with state capital and an exclusive monopoly.” After this bailout, what’s next? Bailing out troubled farms? Automakers? Seizure of the energy industry?
All of these bailouts serve not to help the cause of the people, but instead to strip liberties away from us.
What you can do:
- Use The Mailbox to find out the name and contact information of your Representative in the House. Call and tell them to vote “NO”. If the line is busy, you can also fax them. (Be sure to include your name, address, and phone number on the fax.)
- Check the list of Senators who voted “NO” on the bailout bill. Then call your Senator. Thank them if they did vote no. Tell them how you feel about them selling our liberties in exchange for pork if they voted yes.
- All indicators point toward a massive recession or full-blown depression. Take necessary steps with your 401k, IRA, and savings accounts. If possible, move your savings to a credit union rather than a bank. Most people qualify to belong to at least one credit union. The easiest way to find one is to do a Google search for “credit union near 12345” where you replace 12345 with your zip code. Credit unions are much safer than banks, and typically offer better interest rates.
- As we learned in Hitchhiker’s Guide to the Galaxy, don’t panic. If you need money, by all means take it out of the bank. But if you have money in savings or a Certificate of Deposit, leave the money where it’s at. Without bogging you down with the details, just trust us that this is essential for the future health of the economy. The Great Depression was started by a run on the banks: everyone went to the banks and took their money out, and stuffed it under their mattresses. As a result, banks closed and neither businesses nor people could borrow money, and the economy imploded.
- Put together a series of plans. Sit down with your family and go over the “what if” scenarios. Know in advance what you’re going to do if you lose your job, your spouse loses theirs, or if you both lose your jobs. Decide things such as what unnecessary things get cut (i.e. cable TV, cell phones) and what takes priority. Having plans means less panic if the unthinkable happens.
- Get your financial house in order. Pay down debt, put off unnecessary purchases, and close revolving credit card accounts.
- Stock up. Once your financial house is in order, buy things you know you’ll need — clothes and food — but don’t need right now. This is especially important if you have children who will outgrow their existing clothes.
- Prepare The Fifth Box. Uncertain times are ahead, and it’s better to have it and not need it, than need it and not have it.