We Can Fix That Too!


<>< Josh Rule : : 2008 MCPP Intern

Yesterday, I wrote about the Aerolineas Argentinas, which, although privatized for nearly 20 years, is now being nationalized again.  As I wrote the article, I was thinking to myself, “Why do governments always make the mistake of getting involved in private business?  At least nothing quite so blatant is happening in the U.S. right now.  We are all too focused on the election.”

I stand corrected.

BBC News reported today on the new Housing bill that is very close to passing.  President Bush is no longer threatening to  veto the bill which, in short, would yet again make government a central planning agency out to save the economy.  Perhaps one of the most troubling statements in the article was the following:

The bill hands the Treasury Department the power to extend Fannie Mae and Freddie Mac an unlimited line of credit and to buy an unspecified amount of their stock if necessary.

These are not the sorts of responsibilities government should be bearing.  Federal government is not a business or a private citizen, investing and creating portfolios of companies and bonds.  Neither is it a bank; it does not exist to write les cartes blanches for companies in order to keep them from bankruptcy.  The objection here, though, is that Freddie Mac and Fannie Mae, two of the most powerful companies in housing finance, are sponsored by the government and are not fuly private.  Yet instead of scurrying to increase funding and protection for these enterprises, the government should look for a way to relieve itself of Freddie Mac and Fannie Mae, as well as nearly every other government-sponsored enterprise it owns.

Federal government is not in the business of doing business.  It is in the business of governing.  The government has a right to exert force where necessary to accomplish ends necessary “to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity.” Those things, like business, which should be done through consent rather than through force or possibly even violence, should not be done by the government.  They should be done by private citizens.  They should be done under the influence not of regulation, but of the market, of the billions of decisions cast by the millions of people in our country every day.  They should not be left up to the 535 men and women in Congress.  Running a government and protecting a people is hard work.  They do not need to run its businesses as well.

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