September 30, 2008

Stossel on The O'Reilly Factor: Free Market vs. Economic Bailout

 

By Roger Lempke
Platte Institute Executive Director


CLICK ON THIS LINK to watch John Stossel’s interview with Bill O’Reilly of Fox News. Whether or not you agree with him about the current credit and economic situation, you must admit that Stossel does not mince words.  Why do pundits have such abiding faith (his word) that added government involvement and oversight will resolve the current tight credit situation?  How do we know “the bailout,” which uses taxpayer dollars and drives the country deeper into debt, will actually stabilize the situation?  Why shouldn’t the government just “get out of the way” and let market forces work?


If the American public had known firms were buying bundles of high risk loans their investment decisions would have likely been directed toward safer alternatives.  A bemused O’Reilly commented: “I had no idea they (his personal investment firm) were buying bad paper!”  Had he known, his investments, as well as millions of others, would have been directed elsewhere.  Firms (and their CEOs) with high risk strategies would lose business and respond appropriately.   The market would have corrected itself quite nicely.


Maybe the problem today actually results from a lack of transparency.  Financial experts always seem to solve the last problem; like generals always prepare for the previous war.  Greater transparency is needed to reveal the workings of the financial market in clear and timely ways.  The public has a proven record for doing the right thing when it knows what is going on—individual freedom coupled with transparency is a steady and reliable economic model.   More layers of governmental involvement and oversight consistently fail to solve immediate problems and never predict future ones.


John Stossel believes in individual freedom—the government should get out of the way.  He will be in Lincoln on November 18 to speak at the Platte Institute Transparency in Government conference luncheon.  Early registration ends on October 15.  Sign up now to hear his cogent testimonials—you won’t be disappointed.