Too Big to Fail? Persuasive Essay by Nicky

Too Big to Fail?
A critical analysis of the federal government's response to the current economic downturn.
# 151053 | 981 words | 5 sources | APA | 2012 | US


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Description:

The paper examines the bailouts in both the financial sector and the auto industry and highlights the massive benefits to stockholders and executives at the expense of the average taxpayer. The paper explains how although the bailouts may have forestalled an even greater recession, they did so without any real and immediate benefit to taxpayers.

Outline:
Introduction
Bailouts in the Financial Sector
The Auto Industry
Conclusion

From the Paper:

"The bailouts have been called a form of "'lemon socialism': taxpayers bear the cost if things go wrong, but stockholders and executives get the benefits if things go right" (Krugman 2009). It is very hard to refute this claim, especially given the current uproar regarding the cost of several proposed healthcare reform bills. In less than a year, the federal government has given over one trillion dollars to large corporations that pay many executives millions of dollars a year despite their failure to run the companies in a proper and sustainable fashion, and in most cases without any form of repayment or any compensation for the taxpayer's money. Meanwhile, discussion of spending less than a trillion dollars over a ten-year period to ensure that these same taxpayers have access to affordable quality healthcare is decried as undue government spending and intervention. In short, taxpayers can be used to support giant corporations and their executives who are cutting pension and healthcare benefits, but one tenth of that amount cannot be used to provide the same healthcare--and let's not even get started on the Social Security issue (Krugman 2009)."

Sample of Sources Used:

  • Business Week. (2009). "Auto bailout: Crunch-time for Detroit." Accessed 17 October 2009. http://www.businessweek.com/bwdaily/dnflash/special_reports/20090325auto_bailout.htm
  • Faccio, M.; Asulis, R. & McConnell, J. (2009). "Political connections and corporate bailouts." Journal of finance, forthcoming. Accessed 17 October 2009. http://74.125.155.132/scholar?q=cache:tD0HjtjNmR8J:scholar.google.com/+author:%22Faccio%22+intitle:%22Political+connections+and+corporate+bailouts%22+&hl=en
  • Krugman, P. (2009). "Bailouts for bunglers." The New York times. Accessed 17 October 2009. http://www.nytimes.com/2009/02/02/opinion/02krugman.html
  • Nankin, J.; Umansky, E.; Kjellman, K. & Klein, S. (2009). "History of US government bailouts." http://www.propublica.org/special/government-bailouts#savingsloan
  • Wiladsin, D. (2001). "Externalities and bailouts : hard and soft budget constraints in intergovernmental fiscal relations." IDEAS. Accessed 17 October 2009. http://ideas.repec.org/p/wbk/wbrwps/1843.html

Cite this Persuasive Essay:

APA Format

Too Big to Fail? (2012, May 20) Retrieved April 03, 2020, from https://www.academon.com/persuasive-essay/too-big-to-fail-151053/

MLA Format

"Too Big to Fail?" 20 May 2012. Web. 03 April. 2020. <https://www.academon.com/persuasive-essay/too-big-to-fail-151053/>

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