Do We Need The Bailout?

It's a valid question. There are two schools of thought on it.

The first school is that government intervention in the market brought about this disaster in the first place. From a strictly Libertarian point of view, the successive bailouts and intervention by the Fed only delayed what in and of itself is an unsustainable system. America is basically far past bankrupt at this point and has only been operating by the power of an increasingly arcane system of smoke and mirrors and the Chinese and Saudis buying up our debt, since it was such an awfully good deal for them. Not anymore. We're tapped out, our neighbors are tapped out. We've got no fuel in the tank.

We're to the point now where the first school, myself included, say that paying the piper now is better than later. If we let the chips fall and manage the collapse, we might be able to dig ourselves out in a number of years. No bailout now, take the pain, recover from it. If there's a bailout, the collapse that will result from the cure (hyperinflation) will be fatal. The bailout itself is fatal for America.

The second school believes the first paragraph, but argues that the bailout is necessary now or that the whole house of cards comes down in a systemic collapse without it. In other words, bailout now, or the game ends. The lack of bailout is fatal for America.

This is not the discussion we're having in Washington right now. It's the debate we should of had last night but didn't.

One side says the bailout will kill us. The other side says the lack of bailout will kill us.

Who is right?

Shouldn't we be asking that this election?