My first impression of this story in The Wall Street Journal was to think, Wow, talk about your ideological nut jobs…
Trader Makes a Quick $1.25 Million on Rescue, Then Slams It
William O. Perkins III says he turned a $1.25 million profit trading Goldman Sachs Group Inc. stock last week.You would think that would count as a pretty good paycheck for the Houston energy trader. Instead, the experience left him so angry about the demise of capitalism that he says he has decided to spend his profits on advertisements attacking President George W. Bush’s planned $700 billion Wall Street bailout.
The president has run into a wall of skepticism over his plan…. But the 39-year-old Mr. Perkins is putting cash behind his anger. He commissioned an African-American arts collective to draw a cartoon depicting Mr. Bush, Treasury Secretary Henry Paulson and Federal Reserve Board Chairman Ben Bernanke trampling on the graves of private enterprise and capitalism. Then he paid $139,104 to run the drawing as a full-page ad in the Tuesday editions of the New York Times. And he promises to spend a million more on ads before he is done….
Shades of Howie Rich, huh? I have long been fascinated — an appalled by people who hate government SO much that they’re seemingly willing to pay more to FIGHT the "growth of government" than they would have to pay in additional taxes to support it. It’s not rational. On some level, it violates the very notion of rational selfishness that your purest libertarians avow. It’s letting emotion overcome reason.
Mind you, there are plenty of things to dislike in the Paulson bailout plan — or in the lesser ones that have already occurred. But we are fools if we reject a proposal on ideological grounds, because it does or does not "grow government" or some other quasi-religious incantation. The question should always be, should the government (and that’s ALL we can decide through public debate, what the government should do) should do THIS particular thing in THIS particular way under THESE particular circumstances? Sometimes the answer should be yes, and sometimes no, but we’ve got to consider it dispasionately and without resort to intellectual prejudices. I think that in the case of the Paulson plan, a case can be made that this government action is NOT necessary, especially when you consider that Warren Buffet just put $5 billion of his own money into Goldman Sachs — isn’t that the Wall Street supposed to work, the players who make the right calls attracting investment, while the ones who screw up fail? And if that’s happening, is this crisis really as bad as it’s being painted?
But don’t reject something on the basis that it "smacks of socialism" or some such. I don’t care if it smacks of antidisestablishmentarianism, if it’s the wise thing to do under the circumstances — and that’s what we have to decide.
All of that said, once I read further in the tale of Mr. Perkins, I decided that there was something going on here that went beyond offended ideological sensibilities. He actually felt that there was something wrong, something unfair, about his having made that $1.25 million, on account of the government having changed the rules in the middle of the game. Call it a quirky sense of honor or sportsmanship or whatever. But if a trader on Wall Street can actually realize that he didn’t earn such a payday, and feel like "I’ve gotta give that money back," as he put it, that’s probably a GOOD thing. And all too rare.
Of course, there are a lot more constructive things he could do with that money, and that’s where the notion of throwing it away on ideology comes into play. But he seems to be doing what he thinks is right by his own stunted lights, and that’s something.
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Brad, you are willing to pay extortion money to the government rather than spend the money and effort to fight it, for the same reason cowardly shop keepers pay the Mafia.
Spending $1.25 million of his own money to prevent the government from spending $700 billion of other people’s money seems worthy of the Medal of Freedom in my book.
The more money and control we take out of the hands of politicians, the less likely these types of events can occur. It’s really that simple. They wouldn’t do it if there wasn’t a pot of gold at the end of the government rainbow.
A lot of liberal Democrats became very wealthy running government mortgage programs to sell overpriced homes to naive blacks and Hispanics.
our senator demint showed that he was not only a fool, but an idiot, at one of the hearings earlier today. rather than question bernanke and try to get information to make an informed decision, he speechified about the need to cut corporate income taxes and do away with capital gains taxes; this is all the government’s fault for wanting to put people in homes. nothing to do with greed by local real estate people, bankers inflating the prices of homes to a truly unreal level in some markets so they can get rich. Those ill gotten gains made it to the investment banks where they apparently invented derivatives, which i think are probably really nothing. Greed really IS the root of all evil.
Congressman Demint was making the very important point that this mortgage market crisis was brought about by crooked operations of GOVERNMENT agencies to sell overpriced houses with excessively large loans, to low-income minorities without the proper proof of income and credit.
The purpose was for individuals to become rich by using the charade of compassion for minorities to grab billions of dollars in fees, commissions and bonuses.
Mr. Perkins’ behavior is no less rational than any other with respect to how he might spend the money. I would feel a great deal more pleasure living in an economically free society than say, riding around in a private jet, and I imagine he feels similarly.
While its important to be pragmatic, history has demonstrated time and time again that under almost all circumstances individuals would be 3x-18x better off without government intervention. As such, the free enterprise system is worth of the respect paid to it by Perkins. In fact, were he successful in restoring capitalism to the American economy, his money would accomplish more for humanity than any other modern action.
I sometimes looked back at the new deal era and wonder how the people of the time could have allowed social security to be enacted. I now understand that the fiscally responsible citizens of today may not be able to defeat this bailout, but heroes like Perkins can at least say they did all they could.
You know, Brad, it’s amazing how pervasive government is, and it’s amazing how its deleterious effects roll off you like water off a Rain-X’ed windshield.
Government is like medicine. You take one drug to cure one set of symptoms, and another drug to combat the side effects of the first drug, and another drug to keep those two drugs from interacting, and pretty soon you can’t do without any of them, when you never could afford the price of the first drug, much less the other two.
We can’t use government to prop up everybody, else it will break us all without anyone ever having learned the hard lessons failure teaches.
A $ 700 billion plan in a $ 14 trillion economy isn’t “propping everyone up.” It’s an effort (well-designed or not) to provide enough lubricant to keep the economic gears turning. It offers nothing directly to my family, but we don’t need it. It WOULD bother us enormously if the economic engine suddenly seized up.
lpcowboy,
Social Security was enacted, like most socialism in a democracy, by starting small, with a tax of 1% and a few very old and poor beneficiaries.
FDR lied by calling it “insurance” and a “pension” and a “retirement plan”. It was just a welfare scheme from the beginning.
Now Social Security is a cancer which consumes 12% of every paycheck, money which could be saved and invested to make most working people wealthy, instead of worrying about welfare checks that will soon stop arriving.
>> I have long been fascinated — an appalled by
>> people who hate government SO much that they’re
>> seemingly willing to pay more to FIGHT the
>> “growth of government” than they would have to
>> pay in additional taxes to support it. It’s not
>> rational. On some level, it violates the very
>> notion of rational selfishness that your purest
>> libertarians avow. It’s letting emotion overcome
>> reason.
If the only problem in government is that people were forced at gunpoint to pay for programs which they thought were useful but not worth the money, government would be a much less malevolent monster than it is today.
The reality is that government programs do not just destroy wealth, they destroy lives. People die of poverty every day. Every single day. Most of this poverty is caused by government preventing people from producing.
A case in point is the latest welfare plan for Incompetent Bankers, in which the government first caused a bubble, through inflation and insane policy, and then used the inevitable collapse to aggregate more power to themselves, to pay off their friends, and to punish their enemies. This is bad enough. But don’t forget that these were just the intended consequences. The unintended (but predictable) consequences included people losing their homes, their jobs, and (potentially), their lives.
America is not the same country which weathered the Depression without much rioting in the streets. When this economic bubble really pops (not just the little preview we’re getting now, but a real collapse as the Chinese and others who hold increasingly worthless dollars and they flow back into America, causing massive inflation by their very presence, and a shortage of goods to boot), we will have entered a time when, as Shakespeare put it, “civil blood makes civil hands unclean”.
The deaths, like so many others, will be on the heads of our government. But what’s new? Almost 250million people were estimated to have been killed by their own government in the last century. And that doesn’t even include the indirect deaths caused by massive government induced poverty.
One would have to be a fool not to be willing to pay more than they pay in taxes to avoid this kind of bloodshed.
p.m., I’d respond to you with some devastatingly clever comeback, but the drugs haven’t kicked in yet…