Simplicity

As I sit here listening to the House debate the bailout bill on C-SPAN, I'm struck by two thoughts. Maybe I'm blissfully naive, or maybe I'm just too simplistic, but it seems so clear to me how to fix this mess.

(1) Save money. Don't spend everything you have, and that will leave you with CASH reserves. If you stick to your budget and don't overspend, you won't NEED to borrow money and therefore the credit markets won't need saving.

(2) Will these companies really learn a lesson if the government fixes their problems? Seriously? How many times has that worked for people? You never learn if you don't have to learn hard lessons the hard way. If my kids do something wrong, I let them work it out. Forget your homework? Deal with the consequences. Hit your brother? Deal with the consequences. Sign a mortgage you cannot afford? Tough. I never put pen to the paper if I don't fully understand something. It's your fault that you can't pay for your house, because you chose to sign your name to something YOU DID NOT UNDERSTAND and therefore CANNOT AFFORD. Home ownership is not a God given right. You have to be able to PAY the PAYMENTS, Jack.

On the 3rd day of my freshman year at the University of Alabama, I got the overwhelming urge that I didn't need to be there anymore. I called my mom and she told me to come home. I went home and cried with her and talked to her and she made it very clear that if I wanted to quit UA, I had to take care of the withdrawal process on my own, as well as find a new school and get myself enrolled ASAP. She didn't do a lick of that for me, and I'm glad she didn't. I was scared stiff, but I am a stronger person because I bailed myself out. Anytime I wanted to quit something from that day on, I actually thought through the difficulty of removing myself from the situation vs. seeing it through. I LEARNED from having to take care of my own messes. I was 18. How old is Lehman Brothers? See what I mean?

Now, I know that there's a huge fear of the economy collapsing. But I think it would be a sort of financial cleansing. My mom's dad was a teenager when the stock market collapsed in 1929. Having to live through that time in our history made him a very frugal man. He was very careful with his money and eschewed borrowing money; I'd go out on a limb and say that the majority of the people from that generation were scared to death to lose it all because they remembered what it was like to have nothing. I think it would be a defining moment in our history to let the bailout bill fail again, letting the chips fall where they may. It would surely make us stronger as a country.

But that's just my two cents' worth.