Single Payer health care Does Not Mean less Bankruptcies

E. Frank Stephenson over at Division of Labor notes the following: Single payer health care advocates have been claiming for some time now that a single payer health care system prevents bankruptcies due to medical expenses. A new study by the Fraser Institute (A Canadian think tank) finds that this claim is false. Bankruptcy rates are higher in Canada even though Canadians don't have to fret over medical expenses.

GM: Government Motors

The move to oust GM CEO Rick Wagoner by the Obama administration is yet another masterful stroke towards economic populism; the federal government will now apply copious political pressure to corporations and companies that bristled happily when it came time to accept bailout funds--har! har! har!--little did they know that were essentially making the federal government their hard taskmaster and overseer. The lesson is clear: Don't take tax dollars from the government. They will bend and twist your company to satisfy its political ends while making a public hanging of you and your management. Score one for Team Obama since this whole sorry episode is a clever cover for the White House to dump more public funds to the automakers with little public resistance or scrutiny. After all, getting rid of a bad CEO (aren't they all unpopular now?) in a very public manner appeases populist sentiment against the bailouts for a time.

I will repeat my call for no bailouts for auto companies: Let them go chapter 11. We could have avoided this whole mess if they were simply allowed to go bankrupt months ago.

More public funds for Bank of America

Bank of America has received another $20 billion from taxpayers to shore up their acquisition of Merrill Lynch. This should be an outrage to the average American taxpayer but since the country in under the swoon of the mantra that government must "do something" to get out of the economic doldrums, such massive transfers of taxpayer funds go with nary a protest. Didn't BOA vet the acquisition of Merrill Lynch properly?Or was it that the government implicit guarantee of billions of dollars made them drag their feet when it came to doing their due diligence? When government meddles, unintended consequences are always not far behind.

Some of the best posts I’ve read on the “Wall Street Bailout.”

From The Bobo Files:

There is an overwhelmingly clear majority in both the House and the Senate in Congress. If the Dems really wanted to pass a bill, they could do it on their own. I don’t buy their bullshit that they want to pass a partisan bill. They could care less about anything else, so why this? Could it be the fact that they are trying to siphon off 20% from the $700 Billion + to go to ACORN (the organization that Obama worked with) and other housing organizations? That 20% which is supposed to be going to pay down debt - they want to put it back in to the same kind of freakin’ organizations that caused this problem in the first place. They want to bail out stupid and/or unqualified homeowners on our dollar. They want to give money to an organization that is currently under investigation for voter fraud. Is it any wonder the Republicans won’t sign off on it?

From Shaving Leviathan:

Thanks to the creation and favored treatment of Fannie and Freddie, the CRA, the Tax Act Reform of 1986, and a host of other legislation, the mortgage lending market was severely distorted. Self-limiting free-market mechanisms that constrain bad investment decisions was thus removed. The Fed greased the wheels, and put the whole train on a roller coaster, through a years-long policy of artificial manipulation of interest rates.

(This is not to mention the ample funds Obama himself received from Fannie and Freddie. However, even at #2 on the list of recipients, $135,000 over three years isn't enough to make the case that he was bought, as is common currency on conservative blogs. It's chump change and a tiny percentage of the $150 million those two paid to politicians over the years.)

How the housing debacle really happened

HT: Liberty Pen

Some "speculators" lose too

NEW YORK (Reuters) - SemGroup LP declared bankruptcy on Tuesday after $3.2 billion in oil trading losses torpedoed the formerly 12th-largest private U.S. company.

The Tulsa-based company racked up the massive losses as oil prices ran up record gains, undercutting short crude futures positions SemGroup bought to hedge against its 500,000 barrel-per-day trading business.

To meet obligations, SemGroup plans to sell off oil and natural gas gathering, transportation, and storage assets worth an estimated $6.14 billion that were purchased in a whirlwind of acquisitions since it was founded in 2000. (Read More)

Semgroup was, according to Forbes, the 12^th largest private company in the U.S. The company overestimated the oil market and it has collapsed unto itself. Unlike what the popular media regularly portrays, sometimes the “speculators” will not be making a mint. They will instead make the wrong moves and they will lose spectacularly. Being an oil trader or a "speculator" does not automatically mean great profits and high returns.