Excerpts from Bush's speech on the economy last night (WARNING: foul language)

• Good evening. This is an extraordinary period for America’s economy.

• No sh*t?

• Over the past few weeks, many Americans have felt anxiety about their finances and their future. I understand their worry and their frustration.

• Oh yeah? Your net worth was somewhere between $9 and $26 million in 2003. I'm sure you can really relate to the average American. Side note: Cheney's net worth is somewhere between $30 and $100 million, McCain's is between $25 and $38 million. Yet the Republicans are largely supported by America's working class (well at least the Christian part). I don't get it. Well, I guess I kind of do, but I don't want to believe it.

• Financial assets related to home mortgages have lost value during the house decline, and the banks holding these assets have restricted credit. As a result, our entire economy is in danger. So I propose that the federal government reduce the risk posed by these troubled assets and supply urgently needed money so banks and other financial institutions can avoid collapse and resume lending.

• The government bailout will most certainly not "reduce the risk posed by these troubled assets" - rather, it will transfer that risk to the American people, and our government. Has no one thought yet, what if the bailout doesn't work? Then, not only are we stuck with a supremely f*cked economy, but we will have shown the world that our government is completely incompetent and powerless. And so the American empire declines...

• First, how did our economy reach this point? Well, most economists agree that the problems we’re witnessing today developed over a long period of time. For more than a decade, a massive amount of money flowed into the United States from investors abroad because our country is an attractive and secure place to do business.

• A decade, huh? As in, "It's not my fault!" Investors abroad, huh? As in, "Blame the foreigners!" Sigh. Haha, I won't even start on the irony of his "IS an attractive and secure place to do business" line - but...seriously?

• I’m a strong believer in free enterprise, so my natural instinct is to oppose government intervention. I believe companies that make bad decisions should be allowed to go out of business.

• Oh yeah? Clearly, your ideology is very important to you. That's why you're currently engineering the "mother of all bailouts". F*cking Republican hypocrites.

• Under normal circumstances, I would have followed this course. But these are not normal circumstances. The market is not functioning properly. There has been a widespread loss of confidence, and major sectors of America’s financial system are at risk of shutting down. The government’s top economic experts warn that, without immediate action by Congress, America could slip into a financial panic and a distressing scenario would unfold.

• Scare tactics. Sound familiar? Maybe because preying on the fear of average Americans has been the main route of this administration to doing whatever they want - i.e. Iraq, expansion of executive powers, the f*cking Patriot Act, and so on. There's some merit to this claim, but a bailout of this size is bound to extend weak economic growth through the very long term (have you looked at our national debt figures lately?) rather than a lot of lay-offs in the short term, which would hopefully be replaced by another economic growth engine (I will detail my general idea of how to revitalize our economy at the end of the post).

• And if you own a business or a farm, you would find it harder and more expensive to get credit. More businesses would close their doors, and millions of Americans could lose their jobs. Even if you have good credit history, it would be more difficult for you to get the loans you need to buy a car or send your children to college. And, ultimately, our country could experience a long and painful recession.

• FEAR! FEAR! FEAR! You're f*cked, America, unless you give us unlimited power and money.

• I also understand the frustration of responsible Americans who pay their mortgages on time, file their tax returns every April 15th, and are reluctant to pay the cost of excesses on Wall Street.

• No you don't. If you really did, you couldn't get up there and honestly ask the American people to agree to this ridiculous bailout. Liar.

• It would remove the risk posed by the troubled assets, including mortgage-backed securities, now clogging the financial system.

• Really, our economy is just one big toilet and someone took a massive dump in it.

• First, the plan is big enough to solve a serious problem. Under our proposal, the federal government would put up to $700 billion taxpayer dollars on the line to purchase troubled assets that are clogging the financial system.

• Note: In its original form, they wouldn't have access to $700 billion - they would have access to a $700 billion line of revolving credit. Meaning, Paulson could buy a bunch of bad mortgages, sell them at a loss, and buy more. Continue process. Continue to prop up failed businesses. That'll help restore confidence in America's economy. *saaaaaarcasm*

• Second, as markets have lost confidence in mortgage-backed securities, their prices have dropped sharply, yet the value of many of these assets will likely be higher than their current price, because the vast majority of Americans will ultimately pay off their mortgages. The government is the one institution with the patience and resources to buy these assets at their current low prices and hold them until markets return to normal. And when that happens, money will flow back to the Treasury as these assets are sold, and we expect that much, if not all, of the tax dollars we invest will be paid back.

• ...And peace and love and happiness will reach all the children in the world. Ok, this part actually makes some economic sense - HOWEVER, if it's true, then why can't healthy companies (there are still some!) buy them up? Plus SWFs? If it's true, why are we in this mess at all? Why go straight to the taxpayers? The truth is, a lot of this is psychological - which adminstrations like Bush's LOVE. Breeds fear. So watch out.

• Earlier this year, Secretary Paulson proposed a blueprint that would modernize our financial regulations. For example, the Federal Reserve would be authorized to take a closer look at the operations of companies across the financial spectrum and ensure that their practices do not threaten overall financial stability.

• Don't be f*cking fooled - the Fed played a BIG ROLE in the creation of this sh*tshow. Don't get me wrong, I think we need a huge revamp of our regulatory system. But what we really need is more transparency, not more shady Fed dealings (ever notice how the amount of money printed by the Fed isn't publicly released?). Just think how this whole crisis could have been averted if a simple piece of information was collected and disseminated, like, oh, household income maybe? Loan-to-value ratio? Information that should have been collected regardless of passing on the risk. A simple statistical analysis of the mortages bundled in a RMBS would have probably been enough due diligence then to prevent a stampede of subprime buyers. Or at least enough to keep Fannie Mae and Freddie Mac from buying them up, if HUD had done its job correctly...
• My main point - capitalism DOES work, if everyone has the relevant information. Buying up all that sh*t was not smart business - it was deliberate greedy ignorance and stupidity on the part of executives.

• In the long run, Americans have good reason to be confident in our economic strength. Despite corrections in the marketplace and instances of abuse, democratic capitalism is the best system ever devised. It has unleashed the talents and the productivity and entrepreneurial spirit of our citizens. It has made this country the best place in the world to invest and do business. And it gives our economy the flexibility and resilience to absorb shocks, adjust, and bounce back.

• WHAT?! First of all, I do still believe that democratic capitalism works -- it was the main driver for America's rise to a superpower. However, the Bush administration and its policies were pretty much entirely responsible for royally f*cking up American democratic capitalism - to invoke it here seems almost blasphemous. And that last line, I mean, seriously?!?!

• I know that Americans sometimes get discouraged by the tone in Washington and the seemingly endless partisan struggles, yet history has shown that, in times of real trial, elected officials rise to the occasion.

• Just like you did with Iraq, right? Oh wait...

• So here are just a few of my thoughts, mainly about how we can move our economy into the future, rather than seek to patch up our f*cked up past (apologies for all the cursing, by the way - I'm just so frustrated by the whole thing, being young, I feel like I'm the one who will be paying off the government's credit card purchases for, oh, my whole life). In the past, the one area of our economy that has kept recessions mild was housing. For example, during the early 1990s and after the tech bust, the one area of value creation in an economy that had lost its growth engine, was the re-financing/purchase of homes. The reason was, in recessionary times, the Fed lowered interest rates. Familes that had purchased homes at a time of higher interest rates could refinance, extract home equity, and do a bit of consumer spending (usually on home improvements, furniture, etc.). But this was always as a replacement for the then-defunct actual economic growth engine that was fueled by real innovation (like energy, finance, technology, etc.). Housing basically buoyed GDP growth in times of decline.
• In the housing boom years of 2003 to 2006, the housing market became the growth engine. Obviously, this had happened before, but never to this extent. Everyone believed home prices would never go down (ok, just for future reference, whenever everyone rushes to invest in the same thing, it's going to create a bubble that will overvalue the worth of the assets, and eventually it will burst - you f*cking morons) and made a lot of stupid decisions as a result.
• Now the housing market, usually a source of growth during a recession, is the thing at the very heart of the economic downturn. So, what does our government want to do? Rather than stimulate a replacement industry, they want to throw wads of cash at FAILED BUSINESSES. Did I mention the people you're giving money to WERE INCREDIBLY STUPID?
• So what do I propose as a solution? Actually, something very similar to what Barack Obama has proposed (thank you!). Take that money and instead, invest in jobs that we need (we don't really need investment bankers, though in normal economic times, they do serve a purpose -- although part of me believe Gordon Gecko/Michael Lewis/etc. may have ruined that profession) -- like jobs rebuilding America's failing infrastructure and jobs in renewable energy and healthcare. Industries that could actually produce value in the form of innovation, because our housing industry will not be producing value for a very long time. This bailout is meant to subsidize it in the meantime.
• What would happen if we invested money, instead, in growing industries? Well, people who lost jobs in construction, design, etc. could find work in these industries, which would produce less unemployment and more income growth. These businesses would attract foreign capital back to the U.S. Eventually, new financial firms would rise to help investors tap into these growing markets. The circle of life continues.
• Would it be easy? Oh hell no. A lot of job losses. Massive unemployment in the next year or so. But what worries me about the bailout, is that in order to actually restore capital at these banks, like enough capital to keep them from failing, the government is probably going to have to pay more than the securities could be worth. Meaning, taxpayers take the loss. Meaning, taxes are definitely going to be raised on us in the future. Meaning, it's going to be a lot harder to create wealth during my lifetime than it was during my parents, grandparents, etc. Meaning, f*cking forget about the American Dream.
• I hope I'm being overly negative here and that this all works and our economy is peachy again in 2-3 years. But I just don't know...

• Comments encouraged. And I know how militant I sound and I know my socialist friends are going to blame capitalism and if you do, I just want proof that something else would have worked better. Blaming without providing an alternative solution not allowed. Cool? Fingers crossed.
• Now I'm going to read the terms of the bailout (the agreement was just reached) and probably get angrier. Enjoy your day.