Regarding the editorial “After the fall” (Sept. 13): It should come as no surprise that the government is finding it difficult to step back from its increased role over the financial markets: The government has become the market in far too many instances. The government’s ownership of Freddie and Fannie, Bank of America and General Motors has placed a multi-billion-dollar albatross around the necks of taxpayers. The government’s bailout of Freddie Mac and Fannie Mae, the bailouts through the Troubled Asset Relief Program and the Fed’s dramatic lowering of interest rates are in many ways socialized financing.
Our current system, which forces banks to lend counter to true market signals, greatly increases the risk of failure. These bailouts and government takeovers simply are concealing the rot hidden within many sectors of the economy. Fed by bad economic and monetary policy, an artificial real estate bubble created a ticking time bomb that inevitably went off. By preserving many of these weaknesses instead of letting them naturally die off, we risk creating greater collapses down the road.
Matthew Glans — Chicago
Legislative specialist, The Heartland Institute