Another Government-Program That Works!

Mr. Shaman

Mr. Shaman

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Nov 27, 2007
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"The employees now worked for the FDIC. A public notice went up, which was the signal to a team of nearly 80 people to take over the bank.

They took control of the bank Web site, adding a notice that all deposits were safe. Then they started an inventory of all the assets and liabilities.

They broke the news to the media and prepared to reopen the bank Saturday morning as usual. Asked what she expected from the customers, Bates told Pelley, "I think the customers will, some of them will come in with a sense of fear."

Fear created the FDIC in 1933 after the Depression set off a panic that wiped out even healthy banks.

"We've been around for 75 years and nobody's ever lost a penny of insured deposits," FDIC head Sheila Bair told Pelley. "…which is why you need to make sure you are below the insured deposit limits."
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.....And, who'd know that, better than the Bush Boys.

:rolleyes:​
 
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Another? What was the first?

That said, you might actually have a point... sort of.

In truth, FDIC has done fairly well comparied to the lame crap I generally expect from a government program. However, only other government programs, you can't really compare the FDIC as far as I know. For example, FEMA you can compare to insurance companies they cover similar claims. In doing so, FEMA always sucks.

Does anyone know of another company that performs the same function as FDIC? I do not.

Not to mention the FDIC only has around $50 billion in their trust fund, while insuring over $4 trillion in bank accounts. So it's not like they could really handle in large scale crashes.

I'll look more into this.
 
Andy said:
Another? What was the first?

That said, you might actually have a point... sort of.

In truth, FDIC has done fairly well comparied to the lame crap I generally expect from a government program. However, only other government programs, you can't really compare the FDIC as far as I know.
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.....Besides the Post Office....

:rolleyes:​
 
Now I know you must be joking on that one. The post office is a bloated pig of a company. It has a complete monopoly on the entire country, and yet can't seem to stop raising the price of stamps, at the same time that has record profits over and over.

That doesn't even include it's amazing service they provide, where you go to the post office to find a dozens counters setup, with one Joe blow working, while three others sit in the corner chatting about nothing, while a line of people stretches out the door.

It's funny how liberals talk about monopolies can charge whatever they want and make massive profits, yet the post office charges whatever it wants, and yet is consistently, year after year, subsidized by tax payer money. That's on top of it running tax free.

No, the Post office is not an example of federal government success. More like federal governmen excess.
 
FDIC is running out of funds I understand.
Funny you brought this up as an example.
 
Andy said:
Now I know you must be joking on that one. The post office is a bloated pig of a company. It has a complete monopoly on the entire country, and yet can't seem to stop raising the price of stamps, at the same time that has record profits over and over.

That doesn't even include it's amazing service they provide, where you go to the post office to find a dozens counters setup, with one Joe blow working, while three others sit in the corner chatting about nothing, while a line of people stretches out the door.

It's funny how liberals talk about monopolies can charge whatever they want and make massive profits, yet the post office charges whatever it wants, and yet is consistently, year after year, subsidized by tax payer money. That's on top of it running tax free.

No, the Post office is not an example of federal government success. More like federal governmen excess.
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The post office seems to be able to compete with Fedex and UPS. I've sent packages using all three, and the post office is as good as any.

Last time I took a package to the Post Office, the clerk fed the zip code into a computer, and told me that the zip and the city on the address didn't match. It turned out I had mistaken the zip, so my package would no doubt have been delayed had the post office personnel not been alert and on top of things. Not only that, but I've never gone into our local PO and seen " one Joe blow working, while three others sit in the corner chatting about nothing, while a line of people stretches out the door."

Maybe your local post office is different.

Now, let's talk about the evil DMV, prime example of state government incompetence.

I had been renewing my driver's license by mail until my face and the photo no longer matched very well. The DMV sent me a renewal notice, and I had to come in.

I made an appointment, unlike most of the patrons sitting around waiting.

I checked my watch while entering the building. Two minutes before the appointed time.

I went in, got a picture taken, a vision test, a thumb print, paid my money, and left. The time: appointment plus three minutes.

Government doesn't have to be slow, bureaucratic and wasteful. Some departments do work.
 
The FDIC is just an insurance company.

Any company can appear to do well if they have a government monopoly and every potential customer is forced to do business with them.

So how much more fitting it is that the FDIC is not actually doing well. It really proves that the gov just can't compete with the free market even when they get to force people to use their services.


After the run on the banks in the depression the FDIC was created to safeguard the money so that if another run happened people would be able to get their money out.

So can the FDIC do what it was created to do? Do they have enough money in reserves to pay out if there is a run on the bank? We just saw anove that they have 50 bil with which to insure 4 trillion. Which means that .0125 of the banks in this country can make a claim before the FDIC is unable to do what it was meant to do.

Why have banks been paying into a system for 76 years and it is only able to handle a run on the banks that is .0125 big?

And who really paid all that money to FDIC? The banks are required by law to pay the premiums. To get you as a customer they entice you by paying you interest. Do ya suppose that they pay you less interest because they need to pay those premiums? Yep. You yourself have been paying premiums to fund the FDIC for 76 years so they could handle a crisis should it ever arise and there is no way that they could ever handle a crisis.

They can't do the very thing they were created to do.

Meanwhle the FDIC makes a list of troubled banks. Why wasn't IndyMac on that list before the gov bank went belly up and triggered the economic problems we are having now?
 
PLC1 said:
The post office seems to be able to compete with Fedex and UPS. I've sent packages using all three, and the post office is as good as any.
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It is illegal for UPS or Fed ex to deliver first class mail.

Take away the monopoly on first class mail and the post office would cease to exist (without a bailout) within a year.

Here is a quote:

"Federal law makes it illegal for FedEx, UPS, or any other private
company to provide first-class mail delivery. In addition, the quasi-
governmental agency is exempt from zoning laws, customs regulations,
and vehicle taxes that hinder private package-delivery companies, such
as FedEx and United Parcel Service."
http://www.umich.edu/~umisl/lnews/32602.htm

As I have often said: socialism is so bad that it can only exist when it forces people to buy it's product.
 
Dr.Who said:
It is illegal for UPS or Fed ex to deliver first class mail.

Take away the monopoly on first class mail and the post office would cease to exist (without a bailout) within a year.

Here is a quote:

"Federal law makes it illegal for FedEx, UPS, or any other private
company to provide first-class mail delivery. In addition, the quasi-
governmental agency is exempt from zoning laws, customs regulations,
and vehicle taxes that hinder private package-delivery companies, such
as FedEx and United Parcel Service."
http://www.umich.edu/~umisl/lnews/32602.htm

As I have often said: socialism is so bad that it can only exist when it forces people to buy it's product.
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No one forces us to use the PO to deliver packages, yet it seems to be able to compete with private companies in that area.

That said, of course the monopoly on first class mail is an outdated concept. It's time to open up that enterprise to private companies as well. If you're right about the PO not being able to compete, then it will simply fade away.
 
PLC1 said:
The post office seems to be able to compete with Fedex and UPS. I've sent packages using all three, and the post office is as good as any.

Last time I took a package to the Post Office, the clerk fed the zip code into a computer, and told me that the zip and the city on the address didn't match. It turned out I had mistaken the zip, so my package would no doubt have been delayed had the post office personnel not been alert and on top of things. Not only that, but I've never gone into our local PO and seen " one Joe blow working, while three others sit in the corner chatting about nothing, while a line of people stretches out the door."

Maybe your local post office is different.
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I've been to a number of different post offices for various reasons. One I had to go to because my job had picking up the mail, as part of my duties. Another was because I was mailing out a package of stuff I sold on Ebay. A third one was when a package I ordered was sent to the wrong place.

In all three cases, the results were very similar. Lazy pathetic service, with infuriating situations where employees stood around and talked, while 'customers' were waiting in large lines. I'm going to venture a guess that with multiple thousands of posts offices across the entire United states, the it is likely there are decent ones, run more customer friendly.

That doesn't change the fact that there are many that are not, and don't have to be because they are a government operated monopoly.

Consider this: The post office is mandated by the federal government. It operates tax free. It has an enforced monopoly across the entire nation. It is massively subsidized by the federal government. Despite all of this, the USPS can barely compete with the likes of FedEx and USP. Why?

Here's something to chew on. Wells Fargo, actually started in the mail carrier business. American Express was not originally a credit card, but rather a first-class mail service jointly created by Wells and Fargo.

When the first started out in New York city, they provided better service, and lower rates than the USPS. As a result the government started to arrest mail carriers. But the service was so popular and so needed, and USPS so awful in comparison, that the customers themselves, bailed out the carriers.

Now, let's talk about the evil DMV, prime example of state government incompetence.

I had been renewing my driver's license by mail until my face and the photo no longer matched very well. The DMV sent me a renewal notice, and I had to come in.

I made an appointment, unlike most of the patrons sitting around waiting.

I checked my watch while entering the building. Two minutes before the appointed time.

I went in, got a picture taken, a vision test, a thumb print, paid my money, and left. The time: appointment plus three minutes.

Government doesn't have to be slow, bureaucratic and wasteful. Some departments do work.
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I totally agree. There were two BMVs in my area. Both were absolutely horrible, with lazy people who would barely left a finger to give you a pen if the one on the counter didn't work. I walked in, and sat and waited, and waited and sat. Finely the long line of about 15 people snaked it's way to the front, and I met the most pretty lady that was completely uninterested in her job. After a brief run around on paper work that I didn't need, but now needed, she informed me that I owed more than a hundred dollars, and that their credit card thingy was not working and would be working till next week.

Since I didn't have $100 in cash on my, I had to go to a bank. So I did, and returned. At this point, I was informed I'd have to wait my turn in line.

There is a bit more to the story, but this is enough. I spent more than 2 hours for my license renewal.

But I still agree with you. A new BMV opened up, and for about two years, it was amazingly fast consistently. But then the word got out that that was the place to go, and now it's just as packed and slow as the others.
 
PLC1 said:
No one forces us to use the PO to deliver packages, yet it seems to be able to compete with private companies in that area.

That said, of course the monopoly on first class mail is an outdated concept. It's time to open up that enterprise to private companies as well. If you're right about the PO not being able to compete, then it will simply fade away.
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But even with the idea that they are "competing" ... it's not really competition, because the USPS is massively subsidized. I have heard that on many postal routes, the USPS only earns 1% of the total cost on running that route. Who pays the rest? Well us of course.

Competition is more than offering the same service for the same direct price. If you have to be subsidized, that's not the same price.
 
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Dr.Who said:
So can the FDIC do what it was created to do? Do they have enough money in reserves to pay out if there is a run on the bank? We just saw anove that they have 50 bil with which to insure 4 trillion. Which means that .0125 of the banks in this country can make a claim before the FDIC is unable to do what it was meant to do.

Why have banks been paying into a system for 76 years and it is only able to handle a run on the banks that is .0125 big?

And who really paid all that money to FDIC? The banks are required by law to pay the premiums. To get you as a customer they entice you by paying you interest. Do ya suppose that they pay you less interest because they need to pay those premiums? Yep. You yourself have been paying premiums to fund the FDIC for 76 years so they could handle a crisis should it ever arise and there is no way that they could ever handle a crisis.
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Some interesting things have occurred to me since my first post.

First, even before FDIC existed, banks that crashed, were always bought out by other banks. After all, every bank is interested in getting new customers, and of course, more deposits. During the great crash that ushered in the Depression in the 1930s, the worst hit customers still got back 85% of their deposits.

Second, the FDIC plans to double it's fees. This could be a very very bad move. By doubling the fees, this will undoubtedly reduce interest rates to savings and money market account. That undoubtedly will prompt people to pull their money and move them to investments with better returns, especially since inflation is on the raise. This could make the whole problem worse.

Third, this isn't the first time the FDIC has failed to meet needs without tax payer subsidies. In the 1980s, during the S&L 'crisis', the FDIC blew through $150 Billion in tax payer money. So another $150 Billion is not going to be a shocker to me.

Forth, it looks like FDIC is also violating the S.E.C. requirements that Fannie Mae and Freddie Mac were before. Namely that they must have capital funds to cover at least 5% of their liabilities. Of course I'm sure the FDIC doesn't have to follow the same rules as the rest of the country.

And finely, I realized that the FDIC is controlled by the government, which is part of the reason it's doing so badly. The government back in 2008, passed a law that arbitrarily forced FDIC to cover $250K in deposits, instead of $100K. Of course, the FDIC hasn't been collecting fees in proportion to the new $250K coverage for the past 10-15 years. So it's very logical they wouldn't have the capital to cover their liabilities, thanks to government.

A privately run institution, would never arbitrarily raise coverage without the capital, or the fee rates, to cover the new coverage. Especially during a time of mass bank failures. But of course in a situation where all economic screw ups, can be covered by an out of control government, this isn't a problem.
 
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