I recently listened to Peter Schiff on MSNBC on the direct that the government was taking and that it was the wrong thing to do.  I was interested in what he had to say and did a little research (yes, I Googled).

He wrote a piece in the WSJ in January of 2009 in which he said:

Governments cannot create but merely redirect. When the government spends, the money has to come from somewhere. If the government doesn’t have a surplus, then it must come from taxes. If taxes don’t go up, then it must come from increased borrowing. If lenders won’t lend, then it must come from the printing press, which is where all these bailouts are headed. But each additional dollar printed diminishes the value those already in circulation. Something cannot be effortlessly created from nothing.

By borrowing more than it can ever pay back, the government will guarantee higher inflation for years to come, thereby diminishing the value of all that Americans have saved and acquired. For now the inflationary tide is being held back by the countervailing pressures of bursting asset bubbles in real estate and stocks, forced liquidations in commodities, and troubled retailers slashing prices to unload excess inventory. But when the dust settles, trillions of new dollars will remain, chasing a diminished supply of goods. We will be left with 1970s-style stagflation, only with a much sharper contraction and significantly higher inflation.

The good news is that economics is not all that complicated. The bad news is that our economy is broken and there is nothing the government can do to fix it. However, the free market does have a cure: it’s called a recession, and it’s not fun, easy or quick. But if we put our faith in the power of government to make the pain go away, we will live with the consequences for generations.

If this were a free market economy that is exactly what would be happening in Washington.  I cannot remember who said this, and I apologize, but if a company is too big to fail then it is too big to exist.  I have said in the past, somewhere, sometime we have got to stop all this bailout stuff and just let somebody actually fail and then we can begin to see a recovery.

I found his approach very Libertarian and in some way very true……I also found that he was running for US Senate for the state of Connecticut.  I then wondered if his tone would change considerably if he was elected to the office.  There is a wealth of people with opinions on the economic crisis but they seem to give up those principles and fall in line with the party that they embrace.  Will a smart guy like Schiff be any different?