What Government Intervention is Doing Wrong

Its been a while since my last post but after reading some of what is developing today I felt it was prudent to comment on it. First if you read the papers at all and read the business section you might notice that more companies are asking for bailout money. Not only that but many of these companies have already received money such as GM. AIG is another curious case, they were one of the first companies to have money thrown at them. They have already received 150 billion in bailout money, 60 billion in a loan 40 billion for 79.9 percent equity stake, and 50 billion for housing AIG's bad assests. Not only that but it looks like they won't even be able to pay back the 60 billion dollar loan that it said it would by selling off assests. The problem with this is that in todays economy it is to difficult to sell them and they aren't getting the price they want for them. As of right now they have only sold 2.2 billion dollars worth. Add into the fact that the 40 billion that the taxpayers paid for for equity is now worth 6 billion. So as of right now at the very best a quarter of the money given won't be paid back so AIG has sucked up 37.5 billion of taxpayers dollars with a high probablity of more to come. Another big company that needs more money is GM they are asking for an additional 16.6 billion more to stay afloat along with the 13.2 that they have already been awarded. This doesn't seem like the most sensible thing that the government can be doing right now from my point of view for a couple of reasons. First if they fail then we will have lost that money flat out so there goes another 40 billion. Second if we continue to supply GM and Chrysler then we aren't going to let them fail which could be even worse because the price would just keep on going up. You might ask well if we help them then they will recover and it will all be good. The problem is that they aren't going to recover very fast, they are burning through cash and losing money at a staggering rate. So when will it stop the giving of free money to GM because I feel like they are going to be asking for more money before the year is out. Those are just some things I have noticed while reading the newspaper the past couple days.
Now for why the government could be making a huge mistake having this bailout of over 1.5 trillion dollars. I'm not going to go into to much detail here because this post is already long but essentially it had been widely believed that America was pulled out of the Great Depression by FDR's new deal programs. In reality they prolonged the Depression longer then it would have been. The main reason for this is the fact that they threw money at the problem. The monetary base increased by 100% between 1933 and 1939. The problem with this is that that was the exact problem. The depression was triggered by all the malinvestment in the 1920's and all the easy money available. In essence FDR should have just allowed the liquidation of the overcapitalized companies. I feel like our government is doing the same thing now throwing money at a problem when the money might not even work and it is basically screwing over our later generations by casting us into a deep hole of debt. Now this problem isn't Republican or Democrat based I believe that the problem is our government as a whole and has gotten to the point that they just love spending to much money because its not theirs.