“Government Bailout” - What were they thinking?
The wording of something is SO IMPORTANT! People make emotional decisions and not logical decisions. Think about the last big purchase you made. You bought an expensive purse, expensive tv set, or an expensive car. The reason you bought it was because emotionally, you were attached to this product. After your emotional decision, your logical side justifies your decision: It was on sale; I can pay it off on my credit card; I just got a raise.
Ok, so people make EMOTIONAL DECISIONS; and yet, the government decides to name the bill a Government Bailout! If the government was pushing to make this bill pass, why on earth would they name it a “bailout?”
What do we think about when we hear the word “bailout?” We think of prison, jail, a bad person getting a break; people do not want to give bad people a bailout. Now, I know the banks and the financial system is all screwed up, but if you call the bill a “bailout” then people will naturally associate a negative connotation to the bill. We are emotionally negative to the bill because of the word “bailout”, so people make an emotional decision and oppose the Government Bailout. And how do we justify it? We say that the banks make a mistake, and they should pay the consequences. But what are the real repercussions of this?
Million of people in the US (and even globally) are going to be seriously affected because of the state in the economy. Just take a look at the Dow. It dropped a record breaking 778 points today!!!
My point is not that the bill should have passed or not. My point is that calling it a “Bailout” doomed it to not pass from the beginning. What do you think? Do you feel wording and emotion are as important as I’m saying they are?
I agree with you Jun that the branding of this was important, but I’m going to say they probably did the opposite: called it a “bailout” to tug at your heartstrings and want to help bail your good old buddy, the Big Banking Industry that you rely on, out of *undeserved* trouble.
If they had been honest with us, they would call this a loan we can’t afford to make, to an unqualified borrower.
Our economy is already suffering. We don’t actually have $700b to give to anybody, which means that money would most likely come from countries like China et al through more bonds (although our bonds are increasingly unattractive to foreign governments). Otherwise, it’s going to add $2k PER PERSON to your tax bill. So, while it is true that if we don’t do the bailout, some people will lose their jobs and it will affect the economy, if we DO pay the bailout, it still takes all that money away from OTHER companies and taxpayers.
Erica Douglass had a great history of the banks & credit crisis at erica.biz: http://is.gd/3itq
Thanks for the great comment Cody. My post didn’t cover whether the bail out was good or bad, but you bring up a good point that it could have ultimately lead to a very bad decision.
If they were thinking that “bailout” could have lead people to think that it was like bailing out their good old buddy the economy, then people were obviously wrong. I took it as bailing out a criminal that got away with a terrible crime.
Always good to hear from you.
- Jun