You have got to be kidding, this happened because ...
Here ...
http://www.thislife.org/Radio_Episode.aspx?episode=355
More here ...
http://en.wikipedia.org/wiki/The_Giant_Pool_of_Money
Your blaming the government but it was the banks and business that didnt want to be regulated, that the government was more then happy to let them do whatever they wanted, that caused the problem.
Oh course business doesn't want to be regulated- it hurts them, no one is arguing that. Of course it was also the businesses who made the risky moves. But, the question is why?
It all comes down to risk. High risk moves tend to pay higher, but obviously since they are high risk, if they fail the losses would be huge as well. Rational people, including businesses, understand this and depending on how risk averse the business/person is, they may or may not take part in a risky investment. During the build up of the housing bubble, the Federal government directly invested in and propped up these markets with the billions of dollars they put in it. This told these businesses that even if their investments failed, they would most likely be bailed out because obviously the government would have to bail its own entities- the GSEs- out. Profit being the primary concern of businesses, this insurance simply meant that they would make investments of very high risk because even if they failed, they would be bailed out. If that government guarantee wasn't there, they would not have made decisions that were so risky. This same behavior is apparent in the creation of the Asian financial crisis of the late 90s when investors knew of the moral hazard the IMF created. In the same way, the Fed and GSEs created a moral hazard in this crisis.
Bad decisions by businesses did play a role in this crisis, but that bad behavior was driven by the government. The individuals who bought houses they couldn't afford were also to blame for simply believing lenders when they said the market would continue to go up and equity would continue to pay mortgage payments. But again, the reason these lenders made those risky loans in the first place was because of the government's role in the market as they knew Wall St would buy up their loans and Wall St knew they could package those loans into mortgage backed securities and even if they failed, there was the government bailout waiting.
You can say regulation is needed, but in reality that will only hurt business, create more unstable markets, and create more moral hazards.
Not having unions is efficient, it also means a poor lifestyle for people.
Not spending time with your kids and working is efficient for the job but it leads to being a shitty parent.
Efficiency is one of many factors that needs to be balanced, its not an end goal, at least for anyone who wants a good standard of living it shouldnt be an end goal.
Just as with goods, there is a market in labor. If enough workers say they don't want to work 40 hours, then businesses would have to adapt to needs. If someone is willing to work long hours, then who is the government to place regulations on work just because some other people don't want to work as much or in those conditions?
Unions should be legal in my opinion, but not mandatory. Also, companies should be able to hire a new set of workers if a union goes on strike. In the end supply and demand would control the situation and set fair wages as well.
The u.s. is one of the least regulated places in the modern world *LOL* Americans can profess that this isent true but by the rest of the world, modern standards your country is still the wild west and companies do whatever they damn well please and your people suffer constantly for it, granted China has less health regulations then you.
We are quickly moving away from that and in some sectors we are very heavily regulated. Just because Europe or Canada may be more regulated, does not mean you are right- in fact, our economy is a lot more robust than yours. Also, look at Hong Kong and Singapore- often described the two most capitalist places on Earth. Look at their growth, economic stability, and prosperity. Markets create prosperity and well being, government does not.
Thats just not true, its the governments job to regulate business to make sure they dont trample on peoples rights, that they operate fairly, the mess you are in is because business was given way too much power.
Until you give me some proof as to how the businesses were not driven to do what they did by government, this holds no ground. As for it is the government's "job" to regulate business- that is your opinion. I would rather leave market conditions to supply and demand (the will of the people) than some politician any day. The market is far to complex for one person or a group of people to understand as there are limitless variables involved including emotion.
As for rights, no one is saying the government shouldn't protect the Constitution or basic rights. Ensuring you get paid $9/hour or holding your hand in getting what you want is not a basic right.
Its the same reason so many americans are convinced single payer health care wont work, because insurance companies and big health industry are spending millions to spread lies about the system, they dont want any competition.
Or maybe its the fact that America is the world's health care leader and maybe Canada/Europe has a good system, but we feel we can improve ours without sacrificing innovation by freeing markets. Currently, we are in a state of corporatism, not capitalism, especially in the healthcare market. Insurance companies are heavily favored through gov't legislation (such as not allowing purchase across state lines.) I am not for that- I am against such regulation and I am for free market healthcare, which would have to adhere to supply/demand.
I dont need to point to enron, worldcom etc do I ?
Fraud is a completely different issue- I am still against that. Regulation does not stop fraud though, oversight and improved information does.
Your business world is corrupt and its precisely because you gave business a blank cheque in the 80s and decided you didnt want to regulate them.
The "blank check" is the moral hazard which was created by GOVERNMENT. I am against that- the government should stay out and if companies fail they go bankrupt- simple as that. No crony capitalism- real capitalism.
You need to regulate business, their goal is to make money, if they could grind babies and sell them at a profit they would do it with a smile.
You understand capitalism and anarchism is different right? There would still be laws against murder and protecting the Bill of Rights and Constitution as well as property rights and contracts.
