No matter your opinion, is it necessary is it not, the recent government conservatorship of Freddie Mac and Fannie Mac is just another bailout in a long line of recent bailouts that have me wondering, are we still living in a free market society?
Granted, we can go on and on all day about if the government seizure of the 2 mortgage giants was even necessary however, that isn’t my point. I am just wondering why it seems lately that our government has decided to spread the losses of an industry among the people however, when that industry was riding high, the government didn’t step in and spread the wealth. In other words, when a company, giant or small, starts to fail, our government shouldn’t be stepping in and making the population pay for it’s poor decisions. This action sets up a dangerous precedent that has me wondering, do we live in a free market?
If you haven’t heard yet, you will soon but, when this huge bailout of Freedie Mac and Fannie Mae was still just a rumor, the car lobbyist in Washington were all a buz! Swarming around and positioning themselves to be the next in line for their government handout. Oh yes, make no mistake, the automobile industry saw this as a perfect opportunity to remind the government that what is good for the goose is good for the gander. You see, they to have been feeling the pinch of the credit crunch as well as a sluggish economy and not to forget those dreadful high gas prices. The argument they will have is going to be the same as everyone else and that is, “we are too big to let fail.” Well, I say, don’t let the door hit you where the sun don’t shine on the way out. No industry is too big to fail, no company is too large to let go. In my humble opinion, it is the rise and fall of companies that ensues only the best survive, much like a corporate survival of the fittest. Now, Freddie Mac and Fannie Mae are another type of beast, this is true because of the monopolist nature of their current mortgage holdings and yes, that couldn’t go ignored however, this is a prime example of Washington insiders run a muck! High paid lobbyist and close relationships with Congress and the Senate enabled these companies to do something no one has done in a long time and that is create a monopoly that now holds our entire economy hostage due to poor management.
So, lets do what we need to do to de-monopolize this section of the real estate industry, diversify the risk, create some regulation and move forward with a stronger, robust and better equipped yet smaller mortgage guarantor industry versus having 1 or 2 giants that with one mis-step can shake the very foundations of our entire US Economy!