Tag Archives: retirement fund

First President Bush, then President Obama, have pursued a policy of “too big to fail.”  The first TARP, or Troubled Asset Relief Program set aside $700 Billion of your tax dollars to bail out AIG and others who had lost money investing on poor mortgages.  They were simply “too big to fail.”  Since then, the government has bailed out wall street investment firms, banks, and car manufacturers.  After bailing out General Motors, the government gave away ownership shares to union workers.  If GM had gone through normal bankruptcy first, those union contracts and debt would have been washed away the stockholders, such as your retirement fund, would still own the company.  But we spent $50 billion to bail them out, give the company to the union, then still had to have the go through bankruptcy.  All of the executives at these “too big to fail” organizations made more in bonuses than most of us will make in our lifetimes.

Unfortunately, most of us footing the bill for those “too big to fail” are small enough that our failure means nothing.  Most Americans who have pensions or investment funds have lost 40% or so of their net worth.  Last year 1.6 million bankruptcies were filed.  100,000 were businesses that were small enough to fail.  1.5 million were people small enough to fail.  Last year, 250,000 people lost their homes to foreclosure.  Did the banks lose money on those foreclosed homes?  Well, ninety percent was covered by mortgage insurance – which taxpayers bailed out the insurers because they were too big to fail.  The other ten percent would have hurt the banks – but you guessed it – they were too big to fail.

Meanwhile, the federal government annual debt now exceeds $1 trillion per year.  The government needs more money and more taxes for even more programs.  Why?  Because the federal government is too important and too big to fail.  Over 36% of federal workers now make over $100,000 per year while the average salary is over $76,000.  The average for taxpayers who pay for them is just over $40,000.  We selfish people who are small enough to fail need to pay for them so they can run our lives better than we would left to our own devices.  Those who have worked so hard to have nice things need to get rid of them and live on a smaller budget so that those like banks, investment houses and the federal government can spend all they desire.  Unfortunately, I am on the list of small enough to fail and I believe those who read this blog site are all with me in that same boat.