Posted by
Larry Gee on Wednesday, September 17, 2008 7:16:40 AM
Recently the US Government has decided to spend large amounts of our money on bailing out high profile businesses on Wall Street, and I for one am not happy about it. Sure, I'm disappointed when any business fails, but as a tax paying citizen, I'm not happy about being the majority partner in a failing business. If AIG couldn't manage it's business properly, and was in danger of failing, the MARKET should determine their fate, and NOT the US taxpayer. The management of AIG should concentrate on keeping their customers. Those concerned policy holders that remained unconvinced will take their business elsewhere. That is the nature of the business.
The great thing about capitalism, is that you benefit by your hard work, risk taking, timing and many other factors that contribute to a successful business. It does have a down side. Some businesses fail. They fail because they didn't take care of their customers. They fail because of poor products. They fail because they didn't plan sufficiently for 'rainy days/' They fail because they chose to take risks that they shouldn't have. In such instances, they SHOULD fail. When they fail, if they provided a necessary function, the vacuum created by their failure won't stay empty for long. Other companies seeking to expand, or new companies will enter the now vacated space. That's how it is.
So, now we're all in the insurance business together, thanks to some poor decision makers at AIG, and some worse decision makers in the federal government. What's next? Airlines (constant troubles), autos (GM is hinting it needs 50B), computers (HP just announced 24K job cuts), or some yet unseen problem. If it was OK for Worldcom and Enron to fail without government intervention, so should other businesses. I think we should heed the old saying not to pour good money in after bad.