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Americans Fed Up

April 17, 2009

Americans Fed Up With Bailout Nation

By LAWRENCE KUDLOW | Posted Thursday, April 16, 2009 4:20 PM PT

Is bailout nation about to strike again? Sure looks like it. According to a bunch of front-page news stories, life-insurance companies are about to get TARPed. This is nuts.

The public is clamoring for an end to TARP and bailout nation. That’s a key message coming from the heartland tea parties that are cropping up spontaneously around the country.

This is turning into a real populist uprising against rising taxes (especially state, local and property taxes), TARP and all the federal bailouts — and the trillions of dollars of deficits and debt being used for financing.

If Team Obama ignores this uprising, it has a political tin ear.

While commercial banks of all sizes are increasingly profitable and want to pay back their TARP money, the Treasury Department is now proposing to extend bailout funds to life-insurance companies, most of which are in no danger of failing.

And for those that are in danger, surely it’s time for a bankruptcy proceeding instead of more taxpayer money.

We are already on the hook for banks, GM and Chrysler, and lube jobs for guaranteed government-backed GM warranties. And the banks themselves may go to war against an Obama administration that wants to maintain control over the big-bank sector and prevent these financial institutions from paying down TARP.

It’s as if Team Obama is saying: “Don’t worry about the taxpayers. Just keep expanding government control over the economy.”

And now comes life insurance. But when will this country stop saving losers and start rewarding winners?

Meanwhile, no one has proven that life-insurance companies constitute true systemic risk to the financial system. No one. This is nothing but a bailout. Actually, it’s a precautionary bailout, since none of these insurers has failed.

Despite the stock market rally and proliferating signs of an economic comeback, a new TARP regime is being prepared in case insurers lose more money in their stock portfolios, or their bond investments, or their residential- and commercial-mortgage purchases.

(By the way, corporate bondsare rallying big-time, with prices rising and yields declining.)

Just say no to expanded TARP for insurance companies or anybody else. That’s the real message of the homegrown tea-party revolts against bailout nation and the higher taxes, deficits and debt being used to finance it. Folks tried to tell Washington on the April 15 tax day that enough is enough. They can’t take it anymore.

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