It's becoming increasingly clear that both the elected and appointed Democratic leaders at the helm of the world's largest financial ship of state, responsible for navigating us out of a spiraling economic crisis, have forfeited the common sense and commitment to the principles of a free market -- the most basic of which is the freedom of business to succeed and the freedom to fail -- which have formed America's economic compass for over two hundred years.
Confidence in the ability of our national leaders to restore stability to our financial markets is the most crucial factor to encouraging the investment of private capital and incentivizing growth in our financial markets again. But with government leaders performing like this, one can't blame the markets for continuing to lose faith.
As for the executive bonuses, unfortunately these contractual obligations are binding and it remains unclear as to whether there is any clear and constitutional method for the government to recoup the $165 million it allegedly never intended to give to the AIG executives. Over two hundred years of common law precludes the imposition of retroactive taxation or a politically-motivated tax aimed at specific individuals, let alone the dangerous precedent that would be set by such action.
But hardworking taxpayers should not lose sight of the bigger picture. The unfortunate reality is that $165 million is a mere drop in the bucket when one considers that they are actually being left on the hook for nearly $200 billion in bailout funds AIG has been allocated at taxpayer expense.
The AIG bonus fiasco only signifies the much larger problem of government intervention in the private sector, whether in the mortgage industry, credit markets, or any other aspect of our free market economy. Those of us who have voted against each of the consecutive government bailouts starting in September 2008 cannot help but believe that our commitment to preserving the principles of our free market has now been vindicated.
If we're to effectively "plug the holes" in the deflating balloon of consumer confidence, the Democratic leaders in government must commit to returning to the simple principles of personal responsibility, transparency, and integrity which they're demanding of everyone else, whether individuals or financial giants like AIG. Looking forward, the only viable response to incentivizing real economic growth and bringing true stability to our ailing financial markets absolutely must include an exit strategy for the growing government monopolies of private financial assets.