Whats the role of government in ensuring the financial well-being of its citizens?

[PlanetFrnd]

government has the responsibility to ensure that everyone in America has an opportunity to succeed. it is not government's role to ensure that everyone succeeds. capitalism is formed on the assumption that there are winners and losers. not everyone can win.

in the op-ed piece this guy tries to go about figuring out who to blame for americans putting themselves in debt. he mentions hollywood, state govts, credit card companies, payday loans and even hedge funds (WTF do they have to do with a college kids credit card debt?) but mentions nothing of the people who make the decisions to put themselves in that debt. There is no hint of personal responsibility to be found. IMO the solution is pretty simple. start educating people about money in grade school. learning about basic money skills should be right there with learning how to read and write. It really isn't that difficult to understand how savings and debt works. it could be taught one hour a week in the form of a money class that gets more complex as kids get older. if we did this, we could raise a generation of financially savvy (or least not financially retarded) americans that won't get duped into hollywood, lotteries, credit card companies, no money down interest only mortgages etc etc. to tie this back to my original thought, this would kill demand for lottery, predatory credit cards and home loan companies and they would be the losers and would probably go away. all of this could be accomplished with no gov't regulation into business whatsoever.

Not to get too tangential, but personal fiscal responsibility was taught to me by my parents and grandparents... I didn't even need school for that.

 

[rocketman]

Agree with fourteenandoh. If there's anything the government should do, it should at least improve education on these matters. Unfortunately 'BustNative, a lot of kids' parents these days are precisely the people the author of the op-ed piece is talking about. If your parents are in debt to their eyeballs, chances are there isn't a whole lot they can teach you about being smart with your money.

 

[fourteenandoh]

[quote='BusNative;118256;6]Not to get too tangential, but personal fiscal responsibility was taught to me by my parents and grandparents... I didn't even need school for that.[/quote]

that was my original answer, but i thought i'd throw a bone to you liberals out there

rocketman has it right. it takes a generation of financially savvy folks to raise another. this generation ovbiously doesn't have it so we need to start from scratch. education is one of the main keys to succeeding in a capitalistic economy.

 

[ScriptOhio]

Isn't it "tax and spend" as much as possible?

 

[PlanetFrnd]

that was my original answer, but i thought i'd throw a bone to you liberals out there

education is one of the main keys to succeeding in a capitalistic economy.

Another bone thrown to the liberals?

 

[Mike80]

Role? for the individual - none.

however the government has a responsibility to maintain it's currency and to protect it's trade routes. But that's more of an over-reaching society at large type deal.

As for an individual - take me for instance. If I screw up and buy a $400,000 house when I should be buying a $150,000 house, max out my credit cards and get a 2nd mortgage when I can't afford the first, I don't see how or why bailing these people out of their financial problems should be the government's - or my - concern.

That said we'll likely see some sort of bailout starting in January/February of 2009. Just because.

 

[MaxBuck]

As for an individual - take me for instance. If I screw up and buy a $400,000 house when I should be buying a $150,000 house, max out my credit cards and get a 2nd mortgage when I can't afford the first, I don't see how or why bailing these people out of their financial problems should be the government's - or my - concern.

It's the government's concern only if the government believes more mischief would ensue in the economy if it did nothing than if it did some sort of bailout. Or such is my opinion.

 

[fourteenandoh]

It's the government's concern only if the government believes more mischief would ensue in the economy if it did nothing than if it did some sort of bailout. Or such is my opinion.

i'm of the opinion that more times than not when the gov't gets involved they either prolong the problem without solving it, or create a whole new set of problems that were completely unintended. when it comes to money and investing (which in a way is what a house is) its best to step aside and let the wreckless get what is coming to them.

 

[OH10]

It is a reality, however, that many U.S. citizens have overextended themselves, either through gross irresponsibility or negligent miscalculation. I'll pose the question to the economic experts, since I am certainly not one:

How is the general economic well-being of the average fiscally responsible citizen affected by the rampant poor decisions of others?

 

[MaxBuck]

i'm of the opinion that more times than not when the gov't gets involved they either prolong the problem without solving it, or create a whole new set of problems that were completely unintended. when it comes to money and investing (which in a way is what a house is) its best to step aside and let the wreckless get what is coming to them.

Sometimes yes, sometimes no. I think the creation of the RTC was both a good and a necessary thing, but Nixon's price controls were quite the opposite. Certainly when the Republicans do it, it usually turns out bad.

 

[PlanetFrnd]

i'm of the opinion that more times than not when the gov't gets involved they either prolong the problem without solving it, or create a whole new set of problems that were completely unintended. when it comes to money and investing (which in a way is what a house is) its best to step aside and let the wreckless get what is coming to them.

As I've said, I agree with regards to the housing issues and certainly credit card debt.

The problem now - and something the government will have to consider - may be whether or not an epidemic of foreclosures, for example, will cause other corrallated societal problems like homelessness or heavy increases in the number of people living below a certain basic quality of life, etc. These motives can and likely will be mixed up with political motivations, but a preventative "bailout" program may be a net benefit if it keeps, as a hypothetical example, 25 million people from becoming homeless. I'm not saying that will happen, just an example.

 

[PlanetFrnd]

How is the general economic well-being of the average fiscally responsible citizen affected by the rampant poor decisions of others?

I do believe we are witnessing it right now. Busted overextended home mortgages have caused alot of big headaches for people who are fiscally sound, whether it be recession-related job losses, loss of home equity due to the market, more limited access to debt capital (a new home mortgage), high rates of apartment occupancy and increasing rental rates in the bigger cities... probably more.

 

[Jake]

State-run lotteries are sufficient to demonstrate why the USA has no fucking business going to war with other nations on "moral grounds."

State-run lotteries, feeding dissidents feet-first into plastic shredders...same diff.

 

[Jake]

It is a reality, however, that many U.S. citizens have overextended themselves, either through gross irresponsibility or negligent miscalculation. I'll pose the question to the economic experts, since I am certainly not one:

How is the general economic well-being of the average fiscally responsible citizen affected by the rampant poor decisions of others?

When the government gets involved with rescuing people from their own financial mistakes, we all pay for it.

 

[PlanetFrnd]

When the government gets involved with rescuing people from their own financial mistakes, we all pay for it.

Well, yes. Literally.

Same as when Bear Stearns' assets are rescued (backstopped). Same as when Katrina victims are rescued (hypothetically, of course). Same as when Iraqi citizens are 'rescued' from tyranny. Same as when starving people in other countries are rescued from famine. Same as...