Geithner and the Administration want more control……..

Last week, Treasury Secretary appeared before Congress and asked that his department be granted unprecedented authority over failing U.S. companies. He compared what he wants to the authority given to the FDIC when dealing with failing banking institutions. This includes the power to seize control of institutions, take over their bad loans and other illiquid assets and sell good ones to competitors.

Geithner claims he needs these broader powers to protect the national economy from companies whose collapse could jeopardize it. White House spokesman Robert Gibbs said the White House wants "resolution authority to go in and be able to change contracts, be able to change the business model, unwind what doesn't work."

Geithner testified that the AIG debacle "highlights broad failures of our financial system. Our regulatory system was not equipped to prevent the build up of dangerous levels of risk . . . The U.S. government does not have the legal means today to manage the orderly restructuring of a large, complex, non-bank financial institution that poses a threat to the stability of our financial system." He acknowledged that the current climate of anger, including the rancor over the AIG retention bonuses, will complicate any effort by the Obama administration to get more bailout money from Congress. "We recognize it will be extraordinarily difficult," he said.

Here is what Geithner and most of the Congress doesn’t seem to get ---- they all live in America. We are not a socialist country, at least not yet. This country was built on a system of free market capitalism. The government should not be seizing companies and taking them over. It is not their job. Besides given their track record for running quasi government business units such as Freddie Mac, Fannie Mae and the United States Postal Service what would lead us to believe they could do a better job!

However, what Americans should fear the most is the fact that the government is suddenly buying into failing businesses with money they don’t even have. We are printing money, loaning it to ourselves and using it to buy failing businesses. You don’t have to have a degree in economics to figure out this is flawed thinking.

As Thomas Jefferson said, “A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor and bread it has earned -- this is the sum of good government.”

The free markets have been working for years. Companies rise and fall. Some declare bankruptcy and find their way back (see most of the airline industry) others don‘t. Why is this time any different? The only thing that has caused this time to be different is more government involvement and intervention! Involvement with Freddie and Fannie plus pushing home ownership to those who really couldn’t afford it. Intervention over and over by the Fed manipulating interest rates to avoid allowing the bubble to burst which help fuel credit spending and create false prosperity. Most advocates of free market economics and capitalism believe that this continuous manipulation and intervention by the government deepened the downturn in our economy.

So America, it is time to ask, how much control should the government have? Where will the Obama administration and Mr. Geithner like to go next? There has been talk of everything from limiting CEO salaries and setting limits on employee bonuses, cap and trade, nationalizing banks, national healthcare and redistribution of wealth.

Today, General Motors Corp. announced Chairman and CEO Rick Wagoner will step down immediately at the request of the White House, said administration officials. The news comes as President Barack Obama prepares to unveil additional restructuring efforts designed to save the domestic auto industry. Again, what happened to good old fashion bankruptcy and reorganization? Well in this case Obama supporters at the UAW would have to sacrifice as well and that doesn’t work for the President.

I don’t think this is what the founding fathers had in mind. The government bailing out and taking over businesses is not part of any of the blue prints they left us!

A few closing thoughts:

“The democracy will cease to exist when you take away from those who are willing to work and give to those who would not.” Thomas Jefferson

“A government big enough to give you everything you want, is strong enough to take everything you have.” Thomas Jefferson

“In my many years I have come to the conclusion that one useless man is a shame, two is a law firm, and three or more is a congress.” John Adams

“A government which robs Peter to pay Paul can always depend on the support of Paul.” George Bernard Shaw