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Christianity Today, September (Web-only), 2008 |

Q & A: Dave Ramsey

The popular Christian financial adviser on why he thinks the bailout is a disaster.

Interview by Sarah Pulliam | posted 9/26/2008 11:13AM

The government has rushed to aid several corporations in recent months, hoping to contain an economic crisis. President Bush urged Congress to pass a proposed $700 billion plan for the government to purchase ...

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Tim	Posted: October 05, 2008 9:13 AM

Dave Ramsey is a smart and wise individual financial counselor who has helped many. But if he thinks that removing the capital gains tax and providing mortgage insurance is going to unfreeze the credit markets and reduce the unwillingness of banks to loan money in this downward moving economy, I think he'd better go back and study macroeconomics again. While I agree that the bailout of the mortgage markets will not necessarily normalize bank lending practices, it might remove some of the anxiety of bankers so they'll provide the lending that businesses need to build inventory for the Christmas season of buying. Since 25% of annual retail buying takes place during the Christmas season, can you imagine what would happen if businesses could not provide the array of products necessary to feed the demand? Jobs would be lost, inflation would sky rocket, and GDP for the last quarter would plunge. The resulting recession could become a depression.

Gregg

Posted: October 01, 2008 2:28 PM

Grumpy is right that the Defense Department has a large budget, fy 2008 with supplementals may reach 700 Billion. The base budget for 2009 is estimated at 515 billion. Perhaps he meant "trillion" but getting facts right goes both ways. The idea of being responsible, spending less than you make and having a good reserve is a wise course of action. Not expecting the government to fix everything is also a wise statement.

Jim Lagnese

Posted: September 30, 2008 3:18 PM

What you left out Dave was getting rid of the CRA. If it wasn't for that, we wouldn't be here. Secondly, banks (or any other individual or entity) that make bad decisions should not be rewarded. In the free market sometimes a correction is needed and we'll be better off for it. What is the fear here, that you won't have cable for a year? Operating out of fear usually produces bad results. Slow this train down and lets have some rational talk. Jim http://www.therightguyshow.com

J~Sull

Posted: September 30, 2008 1:14 PM

I really don't understand all of what is going on and it is very hard to find information that explains this so I can have an opinion except that I don't think the people that got us into this position should be the ones making a plan to get us out and I feel like there is a lot of fear being advertised. I read a lot about the big rush to fix this mess or else.....but $700 Billion isn't an amount I would want to sign over in just a few days so my wish and my prayer is for enough time to do what is right and what is best and this feels like impulse and panic not well planned thought out spending. Telling me that our economy will fall apart because there were parts of this bill that were an issue is like the car salesman that tells me I have to buy it today or else....If our economy is so fragile that it will fall apart in two days then we have a huge problem and I am not sure more money will change anything. If I can't balance my checkbook more money won't fix the problem.

DInBama

Posted: September 29, 2008 2:45 PM


Dave is right on the money!! It's so easy for the rich to cluck their tongues at the poor who got in over their heads and say "there should be no help for you"...well now, big business, big banks, big money...the shoe is on the other foot. If you SUPPORT the bailout, you have no right to talk bad about ANY entitlement program EVER again.

James

Posted: September 27, 2008 11:40 PM

Dave Ramsey doesn't believe that we ought to pray to God to fix the economy, instead of doing something about it? "[Re: voting] As a believer, I think that's a mistake. I think we're taught that God is to be our source. We've really got to stop looking to Washington to fix our problems. It obviously doesn't have the ability to do that." We trust God. We don't vote? Yes, God is our source. In God our world consists. God holds up the human beings and things that make any economy. Let's not make this a zero-sum game and think that our trust in God negates our activity in economic politics.

Grumpy Deacon

Posted: September 27, 2008 10:00 PM

"It's the largest government department ever formed in the history of man" Perhaps you should interview some one that knows what they are talking about. This is such a ridiculously wrong statement. The US Defense budget totals more that $1.4 billion, easily more than half of the proposed bail out additionally, its also extremely unlikely (if not improbable) that they will hire more people that the military. Seems if he can't get the easy stuff right, how can his financial advice be very helpful?

Jason

Posted: September 27, 2008 1:47 PM

Unfortunately the US has not been a democracy for many years - corporations and special interest groups like AIPAC manipulate and control the politicians, not the voters. The media are owned by corporations and special interests and they play a beautiful (wink! wink!) spin ballet with the two main corporate-interest-controlled parties, which is why the illegal and catastrophic 3-trillion dollar Iraq war (http://www.mcclatchydc.com/homepage/story/28891.html) happened, not because of (wink!wink!) "WMD". Which is why Bush chose his bailout of the fatcats against the needs of the voters. The voters, their families, the soldiers (men and women) and the people of oil-rich countries are the losers, often paying with everything they have and their very lives. Only the people can break this vicious Babylonian system, and not by voting Democrat or Republican..

Tom Fay

Posted: September 27, 2008 8:41 AM

I am afraid David is like most people: he believes the "spin" of Washington. Not one penny of the $700 billion will go to buy the mortgages. All the money is going to buy the Credit Default Swaps. We have Fannie and Freddie to buy the mortgages. This is just a bail out to Wall Street for the Ponzi scheme in selling $62 trillion of these swaps and $1,300 trillion in derivatives. This is the bailout and I am against it.

Ed B	Posted: September 26, 2008 10:32 PM

I think you need to take some courses in basic economics. You have no idea what you are talking about. You say "Only 7 percent of them are in foreclosure, while 93 percent of them are paying, so why are we buying them all". Exactly, that is why if the U.S. gov't buys these illiquid investments they will get the money back (and it won't cost the taxpayer anything). But, the banking system needs the liquidity right now. The U.S. gov't can provide that liquidity. Yes, people made huge mistakes and should be held accountable. But, we need to get out of this mess now.

Paul H

Posted: September 26, 2008 5:50 PM


To quote a wise piece of advice: "Cursed is everyman who trusts in the arm of flesh". This includes Washington D.C.

Kim	Posted: September 26, 2008 5:16 PM

Thank you, Dave! Several years ago, I began doing the Financial Peace steps without knowing that I was due to catastophic illness, destroyed credit and no other choice. Today, I now know that's what I was doing because I bought the book (at a used book store cause it cost less, sorry, Dave!) Anyway, I have little debt (my house) and can fill up my car because it's paid for and 10 years old but going strong. We are a spoiled lot, thinking we need it all yesterday and selling our very souls to get it. Corporations are the large examples of our individual greed. Less is actually more in my book. Less debt that is. Frankly, I don't want to pay for corporations that didn't manage their resources wisely. Cut exec pay and bonuses cause they didn't do their jobs well to begin with apparently.

MerryKate

Posted: September 26, 2008 4:24 PM


As usual, Dave Ramsey speaks with wisdom and insight. I wish more people would follow his recommendations and plan ahead. This is the first comment I've heard questioning the wisdom of the bailout, and it is sobering.

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