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The Student News Site of Stony Brook University

The Statesman

The Student News Site of Stony Brook University

The Statesman

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    Riches to Rags

    Like the other approximately 305,238,999 Americans in this country, I’ve been trying to come to grips with the current financial meltdown that’s been the headline story for some time now. Also like most Americans, I am neither an economist nor an expert of fiscal matters regarding how the “free” market functions. And like most of you reading this, I’m just another student trying to figure out what the hell’s going on and how it will affect me as a taxpayer.

    We’ve all been hearing and reading about $700 million government bailouts, bankrupt companies, and crashing stocks, but what does this all mean to the average everyday Joe-Schmo? Of course it means something, but the only thing I’m banking on nowadays is that I’m not the only one out there who’s not exactly sure what’s just happened.

    My basic understanding is that these huge companies posted huge profits, essentially at the expense of their consumers and self well-being. In a way this makes crystal clear sense. Isn’t the whole point of a truly free market economy to make as much money as fast as one can? Sure, maybe handing out high interest loans to people who probably won’t ever be able to pay them off in their wildest dreams is risky business, but isn’t it a good way to make bundles of bucks?

    This seems to me to be the one of the underlining causes of the country’s current economic woes, however it doesn’t seem to coincide with the idea that the government must buy these failed companies and bail them out with taxpayer money. Let’s stop and really think about this for a moment. So these mammoth corporations made billions based on premises that would doom their customers and companies.

    Now that they’ve all collapsed, where have these profits vanished to? Why is it now the responsibility of the average American taxpayer to make up the deficit? Shouldn’t I own stock or some sort of equity in these companies if my tax dollars are going to rise in order to resurrect Fanny Mae and Freddie Mac from the grave? How does this not feel like outright burglary to more people?

    It’s obviously a more complicated situation than that, however now that the fundamental flaws have been exposed, I’d like to know what the government’s going to do to ensure that I’m not getting completely screwed by greedy CEOs. Seems to me like this is the companies and their management’s fault anyways. If anyone, they should be the one’s to make up the money, not me.

    It’ll be interesting to see exactly what Congress passes in regards to their billion dollar bailouts. I’d like to know that there’s some sort of attachment that dictates oversight into the operations of future businesses in order to ensure that this kind of debacle doesn’t happen again.

    I have a sneaking suspicion, however, that by the time this article has run, the bailout will have passed, and a whole new debate will be roaring over how exactly we’re going to pay for this and who to really hold responsible. I’m not a betting man, but I’m guessing it still won’t be the one’s passing the laws or running the companies faults. After all, this is a free market economy that we live in.

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