Monday, September 29, 2008

I Hate The Bailout Bill - But I Support It

Yes, the bailout bill sucks. Yes, it sucks that Congress is going to throw $5000 of my hard-earned money at the Wall Street thieves that the Bush Administration let run wild over the past eight years.

But I support the bill. Why? Two reasons, mainly:

(1) I don't have a traditional pension, I have a 401(k) that is invested in the market, in bonds and stocks, in mutual funds and bond funds. I had a traditional pension 25 years ago, when my firm hired a smart MBA from Dartmouth who read the screw-the-workers financial papers and persuaded my employers that it would be cheaper to move the firm's pension plan into a 401(k) plan. Cheaper for them. Much more risky for me. So now I am exposed to the market. I'm in the market.

The bailout will cost me $5000, but a 20% drop in the market will cost me many times that.

(2) I don't know anything about macroeconomics except for a class I took in 1976. But Paul Krugman, an economist I respect, supports the plan. That's enough for me.

Side note, I turned on C-Span this morning to see my Congressman Jim McGovern running the House session from the floor for the Democrats. This makes sense; he's wildly popular in this liberal district and there's no way he loses his job for publicly supporting this hated bill. Plus he's got guts and does what he thinks is right.

No comments: