If the US government had not intervened at all in the events after the market collapse and the Banking crisis, what do you think would have happened to those same poor and the economy in general? Great Depression, part 2?

It's the lesser of two evils like most stuff in politics ends up being, although I do think more people should have gone to jail for ripping people off which led to the house of cards collapsin, but the rich and powerful have been screwing over the poor and middle class throughout history.

That's kind of the point ...

The Federal Government in the United States has taken on a heavy role in the economy, is picking winners and losers, and the rich and powerful elite who are close to the government are (surprise suprise) choosen as the winners; and the cost of this protection, and of these bailouts, is being passed on to the poor people who don't have the ability to avoid taxes.

If you look into the deals that have been made, you will see that the government was either remarkably inept or insanely corrupt being that they were so ham-handed that the friends of the administration stand to make billions at the expense of the citizens of this country. Just look into how George Soros will make money foreclosing on mortgages from Indy-Mac because the federal government has insured the mortgages at a higher level than he paid for them, and at a value greater than the current price of the house that secures the mortgage; essentially, he was charged $10,000 on a $15,000 car that is insured for $20,000 where he can do anything he wants to collect the insurance payout.

In some ways absolutely. But doing it just in the economic sector wouldn't be a good idea. No they need a complete transformation in their way of thinking rather than just the economic sector. And I really do think that could go with any country nowadays. Need to get priorities straight not just bickering on opinions discussing the "hot" issues of the time. Short term and simple fixes lead to simple and short-term success. Let's find the real source of the problem and start from there. I think a lot of that could be attributed just how we view a lot of these things.

And despite the hundreds of billions loaned, the banks are still failing. If the credit was insolvent due to bad practices, the loans didn't fix the problem. Bankers still got bonuses while the smart, decent, banks either didn't need loans, or repaid them very quickly.

Furthermore, do you think that the inflation caused by the wreckless practices of the US treasury won't have problems long term?

It would have been much more prudent to spend the funds AFTER the toxic assets had been dealt with at the private level before the government got involved, rather than before. That way, the government could have assisted the industry, and not merely the bad banks.

@ckmlb - If you jailed the people responsible for the mortgage problems, you'd have to arrest a decent number of government employees as well as congressmen and senators that allowed so many government-backed loans to go out to low-income people that defaulted.

Well yeah, I meant that both the heads of companies and politicians should pay the price and I'm not saying what the government did was a good thing just not as bad as what inaction would have resulted in. The bonuses are like shoving it in the face of people that they got their tax payer dollars, but I think both big parties haven't done anything to lower bonuses. Some of the bad banks that were helped were big ones and if they had gone down it would have resulted in panic (even though up to 100k dollars is insured by the government), it would have been a slippery slope towards a much worse economy as I see it.

But here's a question:

What exactly would we have lost if the banks went under?

It's not like every single bank participated in the atrocious behavior, and sold so much toxic assets. Many were left unscathed. Furthermore, the toxic mortgages would not have been forfeited and the houses would have been given to the bad purchasers for free. The debts would of been outstanding, still. Other banks would have come in and bought the toxic assets at discounts (as they always have done) and banks would have actually learned a lesson.

I know I'm going way off topic from the thread here, but this is my 2¢.

As an outside observer the main problem I can see with the United states government spending is not that it is too high, but that it is far too inefficiently spent.

For example. It seems as though regardless of how much money they plow into the school system, the results don't seem to reflect the investment. This graph shows that in 2003/04 the graduation rates were not consistent with the expenditure per students. It appears as though if this is the problem, then the question shouldn't be about how much is spent, but rather how efficiently and effectively it can be spent (With an eventual aim of controlling and limiting what is spent).

What the USA needs is rope to hang a few bankers from street lamps... the US government is literally selling the country's current and future taxpayers to bail out a few big banks which continue to engage in the same fraud and award themselves billions in bonuses while they're at it.

Welcome to America, Highway. I am glad you see this.

Even on a state level, it's very telling. Expenditures don't match results for students. Some states spend 30-40% less on education per student and provide the same results as a state that spends 20-30% over.

And here are graduation rates:

Notice there's no correlation between graduation rates and funding? Some areas spent much, get little (NY), some spend little and get much (UT) and some are in between.