We came to this crisis through 7 years of continuous insane monetary policy by the fed coupled with irresponsible fiscal stimulus (deficit spending), and we try and recover how? by even more monetary shenanigans by the fed and even more deficit spending.

The Bush/Greenspan policies were bad enough, but the Obama Bernanke policies are actually even worse. The deficit under Obama is not only larger (2-3x as big as Bush’s), but proportionately less of it is paid for by real money. This is because the Chinese and other bond-buyers are starting to realize that not only will they not be paid back, but even if they do, it will be in devalued currency (made that way by inflation).

Whatever budget deficit that is not borrowed is paid for by the Federal Reserve, who is buying these bonds with printed money. This is inflation, and it’s happening faster than ever.

This is just the fiscal printing! Even without the budget shortfall being paid for with imaginary money, Bernanke has put Fed interest rates to the lowest they’ve ever been. The money they’re loaning out is printed as well, and they’ve printed TRILLIONS in the past few months.

The poor and the middle class, who tend to deal in the most cash and who are most susceptible to cost of living increases are effected most by inflation. Therefore, Obama’s policies are actually even more regressive than Bush’s. Even if Obama doubled his ‘progressive’ tax policy, it doesn’t come close to the regressive burden he’s putting on the bottom 50% of income earners through inflation!

Oh, and by the way: In spite of what Obama/Bernanke are saying, there are many economists far more reputable than Krugman who say the bailouts wont even work, but that’s really beside the point. The point here is that the issue is complicated, and there are strong economic arguments against this, many of which are from the standpoint of the average American.

Who could call any anti-bailout stance treasonous? If the stereotypes are true, it should be the DEMOCRATS who are on the front-lines against the bailouts, not republicans. We don’t know if the bailouts will work, but we DO know that the inflation they cause will hurt the poor. It’s a fact, there is no debate about this.

As Jeff Alson says in this article, this issue needs to be debated, not rammed through with name-calling and fear-mongering.