In this issue

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review Nov. 19, 2008 / 21 Mar-Cheshvan 5769

$350 billion bailout is on the table — and it would be smart to leave it there

By Robert Robb

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http://www.JewishWorldReview.com | The transmogrification of federal bailout efforts illustrates why the government should not be in this game.

Simply put, government has neither the wisdom nor the self-restraint to manage a bailout or ameliorate necessary market corrections, regardless of how large or painful they may become.

Free markets depend on failure. This is a hard concept for many people to understand or accept. But failure is how markets impose discipline and reallocate resources from less efficient producers to more efficient ones.

Bailouts are an attempt by government to interrupt and prevent market failures.

Initially, this was justified on the basis that government needed to act to prevent systemic risk. This is the fear that the failure of company A will lead to the failure of Companies B, C and D, and then we'll all be standing in bread lines.

So, to prevent feared systemic failure, the federal government forced the fire sale of Bear Stearns and took over the country's two largest mortgage firms and the country's largest insurance company.

Rather than deal with the fear of systemic risk one company at a time, the Bush administration proposed that the federal government get into the business of buying distressed assets from financial institutions, particularly mortgage-backed securities, thought to be the heart of the problem.

Congress allocated $700 billion for the program. Although the language of the bill was written irresponsibly loosely, it was clear to all that the purpose was to buy distressed assets directly. It was even called, legally in the legislation, the Troubled Assets Relief Program.

Now, Treasury Secretary Henry Paulson has announced that none of the money will be used for the purpose for which it was allocated. Not a penny.

Instead, Paulson has been using the money to buy preferred shares in financial institutions. He began by investing in nine large banks he described to the American people as healthy. In other words, they didn't need the money.

This was supposedly to reduce the stigma attached to participating in the program, so that the financial institutions that did need help wouldn't be reluctant to ask for it. Instead, a reverse stigma was created. Healthy smaller banks felt obligated to try to get federal funds as well, fearing being perceived as too weak to qualify.

So, presumably to try to restore "confidence" in the system as a whole, the government has purposely obscured from depositors and investors which banks are healthy and which need help. Remember that the next time you hear some government official pontificating about the need for more transparency in private markets.

It's clear that the Bush administration is no longer trying to do the minimum necessary to avoid systemic risk, the collapse of the entire financial system. In fact, Paulson has declared that that danger has passed.

Instead, the Bush administration is trying to use its pile of money to make more credit available on easier terms in an effort to goose the economy. So, Treasury wants to expand the program to include companies dealing with auto, student and consumer credit, none of which can be remotely described as representing a systemic risk to the financial system as a whole.

Democrats in Congress want to include the auto companies themselves, which is most accurately seen as a jobs program. Auto parts manufacturers want in on the action.

So, rather than a targeted program to avoid systemic risk, there's a $700 billion grab bag for whatever interests can politically muscle their way to the front of the line.

This isn't to say that government has to remain idle during economic downturns. The government is good at writing checks. It can increase income support to those most vulnerable during a slow economy.

However, the government is incapable of managing or ameliorating fundamental market corrections. If the country has overinvested in housing, housing prices have to come down. If the country has overborrowed, credit must become more scarce and costly. If auto companies have developed unsustainable cost structures, they need to pare their expenses through bankruptcy reorganization.

The federal bailout bill allocated an initial $350 billion, with Treasury able to trigger the second $350 billion subject to a vote of disapproval by Congress.

The sensible thing to do at this point would be to shut the program down. Paulson has indicated that he might not trigger the second $350 billion.

But that would leave $350 billion on the table. And that's a temptation I doubt the politicians can resist.

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JWR contributor Robert Robb is a columnist for The Arizona Republic. Comment by clicking here.

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