What am I missing about the economy?

I'm not talking Freakonomics--that's some sort of trademarked, copyrighted, and otherwise protected nomenclature. I'm talking, literally, about Freaks and Economics.

My mind reflects back to the SNL skit of "Unfrozen Caveman Lawyer" where Phil Hartman played--get this--an unfrozen caveman lawyer, who was "unfamiliar" with technological advances (such as telephones) and had the knack of reducing his client's argument to a very simple message. Check YouTube for some of that fodder. On some levels, the general public is like the lawyer. We can't understand the reasons Congress and their minions ("advisers") have seen fit to make the financial decisions they have, basically without our consent.

As an unfrozen caveman myself, I can only get my mind around things like Supply & Demand. I can, on some levels, understand the competitive nature of business and that there is this little concept called RISK which is part of the business landscape. Anytime a business undertakes operation, there are inherent risks to that venture. For example, there is competitive risk (did American auto industry REALLY see Toyota coming?), interest rate risk (how much will it cost me to borrow money for my operation?), governmental (regulatory) risk (what sort of millstone will they hang around my neck this year?), labor risk (will I be able to find and hire the right people?), and many others. 

It's okay for businesses to fail, they do it everyday! For large, viable, economically relevant (think the Dow 30, for example) companies they seem to have more protection from this RISK than do small businesses. WHY?

It is difficult to sit on the sidelines(yes, I've emailed my congressman) and watch all the governmental bail outs happen to help fix the Free Market. Here's a little tidbit to our government "leaders"; leave it alone! In times of economic hardship there will always be opportunity amidst the swamp of woe. Yes, people lose their jobs, people go belly-up on their mortgages, and so forth. These are natural consequences. It was never the intention of our Founding Fathers to ensure the prosperity of the citizens of this great country--nor the prosperity of business entities.

Here are some other musings:

1-The economic abyss in which we find ourselves was started by a relatively few homeowners being overextended on their mortgages. This is insanity. Really?!?! We have a few thousand people who--all of the sudden--can't pay their mortgages? And this, in turn, melts our whole banking system down to a sliver of a wick...? Really?!?! Sounds to me like there is some spin and excuses being made on all levels of government and financial institutions about the nature and reality of the situation.

2-Whether or not #1 is true, there is an economic principle that has been violated by the very citizen's of this nation. That is, you cannot spend more than you earn and be a viable, contributing member of society. Just because credit is available, doesn't mean you should use it. Just because you CAN, doesn't mean you SHOULD. (Pick your own metaphor and place it here.) Americans have lived so far beyond their means that the average credit card debt has continued to rise and the average household savings rate has continued to decline. The age of gluttony, excess, and entitlement has sure caught up with us, hasn't it?!  I had a Finance professor once quip, "I would like to write a book that is entitled, "How to Get Rich Slowly." Indeed. 

3-If you are going to give borrowed money to a company, why would you give it back to the very crooks who got us in this mess to begin with? There is no reasonable person who thought reverse mortgages, interest only loans, packaged derivatives, and shareholder equity in homeowner mortgages was a good idea. Nevertheless, our grossly overpaid bank CEO's, fund managers, and everyone else in the investment pipeline couldn't see straight. They all saw dollar signs, to hell with the warning signs, "Curve up ahead." So, our fearless savior of a president decides to give some stimulus money right back to same nimrods that helped get us here. Thank you so much for that decision.

4-Now, to ease into the era of government control and regulation, Obama has "tightened the noose around the automakers' necks" giving them strict rules on what they should do be competitive. Who ever said making "green" cars was a competitive edge? Everything I've read suggests that any activities related to "green" just costs more money with very little payoff. Oh, wait, I guess it will cool the earth down a degree or two. Give me a break.