Treasury: "We just wanted to choose a really large number."

[bascule]

http://www.forbes.com/home/2008/09/23/bailout-paulson-congress-biz-beltway-cx_jz_bw_0923bailout.html

 

In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy.

 

"It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."

 

Are you kidding me? The $700,000,000,000 figure didn't actually come from any sort of calculation? They just pulled it out of the air? "What's the biggest number you can think of?" "$700 billion?" "Sounds good to me!"

[Phi for All]

The $700,000,000,000 figure didn't actually come from any sort of calculation? They just pulled it out of the air?

Wow, that stinks. It stinks so bad, I don't think the air is where they pulled that number from.

[Realitycheck]

It's a sales pitch, an advertising gimmick. "Yeah, you better believe we know what we are doing, you betcha ..." (as McCain bails out of the cockpit shaking his head in disbelief )

[Phi for All]

It's a sales pitch, an advertising gimmick.

Excuse me? What's a sales pitch, the number itself or the spokesperson saying the number is arbitrary?

 

I can tell you that neither is a good sales pitch (I know you didn't claim it was good). Mentioning price up front is never a good idea, and admitting your numbers are arbitrary erodes trust.

 

If they really wanted to sell it to me, they should start out telling me how much this will help the economy, then tell me how much interest the taxpayers are going to earn from this "loan". Then tell me what the duration of the loan will be, and only then tell me it's just a mere $700B. I might be impressed with such a plan.

[john5746]

Well, whenever I have been asked to work or advise on budgets, I always inflated my numbers, provided fudgey details to back them up and hoped prying eyes weren't too informed to know a difference. They always want to give you less anyway, so might as well hit them with more up front.

[bascule]

Well, whenever I have been asked to work or advise on budgets, I always inflated my numbers, provided fudgey details to back them up and hoped prying eyes weren't too informed to know a difference. They always want to give you less anyway, so might as well hit them with more up front.

 

Something tells me your budget wasn't $700,000,000,000

[Pangloss]

It's bad if we think of it in terms of how estimates of the Iraq war went. But these are economists, not war planners. I'm not so sure this is a bad thing.

 

I guess I'm more concerned about what may be overlooked in the mad rush to solve a problem that even they haven't fully wrapped their heads around.

[Phi for All]

I guess I'm more concerned about what may be overlooked in the mad rush to solve a problem that even they haven't fully wrapped their heads around.

Unwrapped heads lead to jerking knees.

[iNow]

I guess I'm more concerned about what may be overlooked in the mad rush to solve a problem that even they haven't fully wrapped their heads around.

I, too, am very concerned with this same thing. I'd MUCH rather something be done correctly than quickly, especially on something like this.

 

It appears that constituents are flooding their representatives with letters and emails along these same lines. Let's hope that yet another bad policy doesn't get forced down our throats. This is too important to screw up...

[bascule]

Doing my usual "catch up on this week's Daily Show in a single night" thing I was intrigued by Bill Clinton's suggestion:

 

Charge interest?

[Pangloss]

Yeah they're doing that with AIG and it does make sense with future bailouts -- treat them as investments, Warren Buffet-style. That won't work for things like bad mortgages, but it could work for businesses that are basically sound.

[ParanoiA]

Doing my usual "catch up on this week's Daily Show in a single night" thing I was intrigued by Bill Clinton's suggestion:

 

Charge interest?

 

Heh, I liked seeing Bill again. And I liked that take too. It's kind of weird hearing democrats talk about big profits as a good thing.

 

A buddy of mine from work, an Alaskan libertarian no less, had the idea that we should write the bill to force the profit, from reselling these loans back to the private sector, to go straight to funding social security in lieu of that crisis.

 

Also, are we going to tax ourselves at a higher rate when we enjoy these windfall profits we're being promised?

[john5746]

A buddy of mine from work, an Alaskan libertarian no less, had the idea that we should write the bill to force the profit, from reselling these loans back to the private sector, to go straight to funding social security in lieu of that crisis.

 

That is a great idea - it should go to pay off something, not to be used as a stimulus check.