Debts, Bailouts and profound stupidity.
So, this morning the Today Show was speaking of the failure of the bailout plan as a failure of leadership as if somehow all of America was united around this plan and something weird just happened. They persisted in this fallacious argument by parading a series of their correspondents to advocate for the bill. I had never seen such an egregious violation of journalistic ethics on this station before. Fox News, sure, that is routine for them, but for NBC to do so was just shocking but I guess not unexpected since GE is their parent company and also a major bank with lots of loans out in the economy. So, they were advocating for their own corporate bailout at the expense of their viewers.
So here is part of the funny. The obvious one is that the "captains of finance" have spent the last 20 years complaining that government was the problem and now they are desperate for government to be the solution, so much so in fact that they are turning their NBC on-air talent into mouthpieces of a government bailout plan that violates the principles they spent so much money lobbying Congress for over the last two decades. Of course, this is not a unique or rare opinion so I will say nothing more.
Here is another ironic twist. The problem is that people can't pay their mortgages and are losing their homes. This leaves the banks stuck with homes and people not paying their debts, so what is the solution with the People's money? Give it to banks in exchange for that debt, thereby leaving the People indebted still further and without their homes which were the intial source of their initial debt. So the bailout plan is to leave the People doubly indebted. Wouldn't it make sense to give the People's money to the People who are having debt trouble so they can PAY their debt to the bank. It would amount to the same thing, the People's money going to the banks, BUT it would be mediated through the people and would have the accounting effect of allowing people to keep their homes. Heaven forbid we help regular people keep their homes as the WAY to keep banks from failing. I mean why would be bother to spend the People's money on the People?!
Here is yet another ironic twist. When Mexico went into debt crisis we gave them money. When Russia went into debt crisis we gave them money. Now we are in debt crisis and we are asking the American people to give the money. How about we ask the People's Republic- China- to cancel some of our debts or open up their cash reserves to keep our banks afloat? How about we ask Russia to buy some of our debt? That would give them a stake in our economy that would keep things more peaceful. China might be setting their sights on going to the moon and beating us in the Space Race but their significant dependence and investment in our economy has kept them much less belligerent than Russia towards us. If we can use this as a way to give Russia a big buy-in into our economy we can help forestall that looming Cold War. Another potential solution is to turn to our loyal oil friends in Saudi Arabia and the United Arab Emirates who are sitting upon millions of petro-dollars and ask them send some of that money this way to keep our economy afloat. I mean we've certainly earned their support through propping up their corrupt and anti-democratic regimes. Our country needs dollars and we don't have any, and they have an excess. The bailout would be financed by more borrowing those petro-dollars (among others) anyway, borrowing likely from foreign sources, but I have heard of no government attempting to offer us the financial help which we often offer to foreign nations in crisis. I am not even blaming those foreign nations, but an American government too prideful to ask for help from those who have all the dollars. Stupid. This is simply stupid, but this is Washington.
Our two-party system drives a system of asinine politics and banal stupidity. This is very much the reason for the collapse of our nation. There is definitely President Bush and the Republican Party to blame for their stupid political sense, which it turns out has done more harm to capitalism than sane regulation, but the Democrats are supposed to be the party of opposition and yet they've opposed NOTHING at all. If Bush gave away the store it is because the Democrats failed to lock the door and they failed to lock the door because they are a party of no principles. This is what our two-party system has come to, a party of stupid destructive principles and a party of no definite principles.
I am soooooo glad I will get to live to see a Chinese astronaut on the moon on TV while sitting my living room in a second class former world power. (yes I am being sarcastic, like any Patriot I want my nation to be first class, though perhaps a bit more humble about it)
Labels: homeowners bailout faillure banks China debt stupidity Paulson Bush Democrats Republicans
Bailing out Wall Street with the People's Money....
Amazing that the "People," that word attached to the names of so many Communist states we held in contempt, are now being asked to buy up the bad debt of banks, not the banks themselves which have failed spectacularly (which would amount to nationalization of course), but simply their bad loans. This is a horrible irony. For years American bankers and talking heads told us that our "flexible" financial system was the envy of the world. We witnessed accounting firms like Anderson collapse under bad "flexible" practices and still nothing happened. Nothing was done.
Now, after being told for months that the problem would be "contained," as in only the 'People' would suffer... thrown out of their homes etc, now the bankers and their "flexible" banks are in trouble. Please. They are the same ones who said welfare for the "People" was a drag on their State, their Capitalism, and now they are begging for a welfare program for their businesses that would dwarf any welfare program ever enacted to help the "People." They want $700 billion (no doubt the conservative estimate as these things always cost more... see the Iraq was which was supposed to be "FREE" of charge) to buy their debt so that free of that debt and with the People's cash in hand they can begin making loans again. Who would spend the People's money and buy this debt, why Private Contractors, the same guys who've done so well in Iraq for us?
Let us look a little deeper into this program. All this money would only be used to purchase the debt of US companies, leaving all those foreign creditors, by far the majority of our creditors, stuck with nothing. Let them suffer for bailing out the US, and wasting their capital keeping us solvent these last few stupidly wasteful years. Frankly I am none too sympathetic to them, but what this plan amounts to is a paydown to US-bank-owned debt while leaving a virtual default on foreign debt. You know, a default, the thing President Bush condemned Argentina for doing a few years ago and which Russia did a few years before that. Sadly this might not be the worst part of the program. China owns a big chunk of our debt (Japan too) and they have been a bit too cocky of late. We can help crash their banks by defaulting, which would be fun. Also the strong growth of Russia and Argentina since their defaults suggests that a default isn't all that bad. This of course brings me to a second and related point. If Russia and Argentina have done so well after their defaults, why don't we just default on everyone's debt?! Sure we'll lose a few banks (and more than a few bankers one would hope) but in the end we'd end up with banks who loan wisely and are more guarded in their assets. This is the Natural Selection law of capitalism (thanks Wharton School), invisible hand stuff. Banks with bad practices fail while those which operate wisely grow and prosper. Our currency might collapse naysayers would say. It already is I would answer.
Frankly we are the greediest nation on Earth- the biggest consumers. We are constantly taught that defaulting leads to creditors not wanting to loan us money. Garbage. We are the United States. Everyone will continue to loan us money because they have no other choice. Does China want to punish us by not lending us money? Well then I guess we won't have money to buy all those Chinese goods.... ahhh.... so yes China will continue loaning us money no matter what. They have no choice. In other words we can actually use the greed and selfishness that got us into this mess to get us out of it. It is not an ethical solution, but then again we aren't an ethical nation and well, China and Russia are far worse than us so who cares if we screw them over?! Realpolitik. Kissinger would be proud except of course he sits on the Board of a lot of the banks that are going to tank. Oh well. Kissinger taught us we shouldn't be sentimentally attached anyway so I am more than willing to bankrupt Kissinger for the good of the nation. Maybe he'll write more interesting books like Diplomacy if he is bankrupt and has to start working again for a living.
Labels: bailout greed China default Russia debt realpolitik banks
Automakers want Gov't Loans
An AP article by Ken Thomas filed today 9/7/08 is headlined thus:
Auto industry to press Congress for $50B in loans
So once again the corporate welfare which supposedly does not exist in the United States rears its ugly head. Car manufacturers are struggling now because Americans are no longer buying the stupid, impractical and selfish SUVs of yesterday. GM and Ford are both closing down factories and laying-0ff workers, and yet in 1998 on the strength of SUV sales, which any jackass would have known would not be a persistent trend, Ford made what was at that time the biggest profit in human history. (Did they invest this profit to insure future sustainable profits when the SUV bubble burst? No, of course not, they gave fat bonuses to their executives and built more SUV plants and lobbied for more tax cuts to deliver more profit) Of course at the moment it is Exxon that continues to hold and break that record and that likewise is not investing in future tech but instead lobbying to get a stranglehold on America's last untapped offshore reserves so they can hold us as energy hostages in the future when oil runs out.
So people like me knew in 2000 that this SUV trend would not last. Gas prices went up quickly after 9/11 and yet the auto industry did not begin re-tooling their factories or designing cheaper, more fuel-efficient cars. Instead they continued flooding our marketplace with stupid freaking SUVs as prices continued to rise for gasoline due to the fuel demands of those ridiculous behemoths. Of course, this is partially the fault of US citizens who kept buying them, but then again if there was nothing to buy then they would not buy them. So yeah, GM and Ford kept pushing out the SUVs without planning to make any changes to smaller vehicles even though the writing was on the walls for anyone with a brain and they were earning the profits to do so.
So why didn't they change? Well because they knew they could "maximize profit for their shareholders" as sociopathic corporations do, and when the bottom inevitably fell out as they knew it would, they would just fire thousands of hard-working Americans (not to mention Canadians, Mexicans and all those other places with US auto production facilities), to cut costs and then use the threat of increasing unemployment to convince the US government to give them money. This is exactly what is happening now. (Government policy either rewards stupid business planning or business leaders are more profoundly selfish, evil and manipulative than we dare think) If the automakers are turning to the US government for funding to make what citizens are now demanding, smaller and more fuel efficient vehicles, then that means either a) no bank would fund them because of their poor management and inability to anticipate trends- just like in the 1970s and/or b) they understand what most Americans do not which is that our US government always subsidizes and bails out major corporations for billions more than they ever bail out individual citizens in trouble. In the meantime the board of directors of these companies continue to receive 6 and 7 figure salaries on which they will pay a lesser percentage of taxes than the assembly workers in their plants.
This country is headed for financial collapse if trends continue this way, but the wealthy elites of this country don't care because their capital is mobile as they are as well. If they use up this country and suck it dry like the parasites they are then they can pull up stakes and move someplace else to begin the process again. I always thought those 1920s Communists who called business leaders (not small business owners who are basically just workers, but the corporate sociopaths and their "boards") blood-sucking parasites were just being dramatic and emotional, but as we observe today more and more, Communists were correct. These people are parasites. I am not saying Communism is even possible or correct, but to say the prescription is wrong is not to say that the diagnosis was wrong. The diagnosis in this case was truly accurate and as our big businesses go again with their hands open, begging government while bribing Congress we see again that our capitalist system is profoundly flawed and not even truly capitalist or "laissez faire." In a "laissez faire" system which might actually be better, the US government would just tell Ford and GM to kiss its ass and fail because being a good businessman is about reading trends and knowing that SUVs were unsustainable. However our government has always rewarded corruption and bad business practices at odds with the capitalist, "free market" principles which the same government always espouses.
So yeah funny enough in some ways I want more "free market." What we have in the United States is a charade. Whenever someone in the US says "free market" what they really mean is free to stomp workers' rights and disregard environmental concerns secure in the notion that when they completely screw up they will be able to screw their employees (while the government protects them from employee retaliation) and get a huge government bailout from the tax money paid by their now laid-off employees. It total bullsh&% and I can't take it anymore.
Labels: Corporatewelfare auto industry Congress taxpayers
Palin's Prego Daughter.
So Obama says that we are not even supposed to discuss it, and if I were not an angry bitter person I'd probably agree. What is most amusing about this is that Palin is a vocal proponent of Creationism, and those other "Christian" views like Abstinence-Only which we are told magically solves problems like say "teen pregnancy."
Sadly, Republicans who spent years dragging poor Chelsea Clinton through the mud always seem to act indignant enough to get people to back off though they are the first to slime family members of any Democrat opponent.
This highlights another important issue. Republicans are always the first to raise the standard for "family values" and what not, and yet they have a ticket led by a man who dumped his wife during his mid-life crisis for a younger, richer woman, getting a divorce eventually to marry the new blond, rich thing.
As if McCain as the champion of family values is not laughable enough since of course the Family Values crowd didn't approve of him anyway, he picks someone whom they WORSHIP, Sarah Palin, whose family values are just as soiled. She is likewise divorced and remarried, though loyal to her blood-family, as evidenced by her illegal firing of the Alaska Public Safety Commissioner who wouldn't fire her sister's ex-husband- a state trooper who probably cheated on her since Cops are among the most likely professions to stray on their wives. So, Palin will illegally try to punish a man who dumped his wife, because that wife happens to be her sister, but she'd be thrilled to join up on the ticket with a man who dumped his wife, and now also to force her daughter into a marriage because this daughter's never learned about birth control from her "abstinence-only" mother. I bring this up because I have a feeling that a marriage between a 17 year old and an 18 year old probably won't last which means that Palin is helping to make it that her grandchild will eventually be growing up in a broken household. Those are fantastic family values as the Republican crowd defines it for us. As the Palin family history shows, Palin herself, her sister etc, these women are not very good at keeping marriages together. What a fantastic standard-bearer for the "Family Research Council."
On a related note. The Palin story is a great illustration of why the supposed "family values" crowd are just idiots. Abstinence-only didn't prevent her oldest daughter from getting pregnant. Forcing her daughter to marry the guy doesn't make a happy household either. Teenage pregnancies happen, and what all the research (please look it up if you don't believe me) suggests is that girls who something to look forward to in life are less likely to get pregnant. There are other issues, like say women who get medically inaccurate health information are likely to get pregnant as well, you like the information furnished by these terrible BS 'abstinence-only' programs.
Obama pointed out that his mother had him when she was just 18 years old and he grew up without his dad. Democrats understand that these things just happen sometimes and are tolerant and understanding that life happens sometimes and vicious, judgmentalism does not help. The "Family Values" crown believes that vicious, judgmentalism does help, when clearly it does not, even with the wealthy daughter of the Governor of Alaska. The difference is that vicious, judgementalism is well VICIOUS and JUDGMENTAL. It adds nastiness and cruelty to the world and does not achieve the goals it is supposed to achieve. I don't blame Palin for having a daughter get pregnant. I blame Palin for tying herself to horrible and vicious people who would likely be denouncing her and her daughter were she not a Governor and VP candidate. I also blame her for having to confront the realities of the problem of teen pregnancy and yet still arguing for the stupid ideas which are not helpful. The issue is not her daughter. The issue is Palin. Why does she believe in such stupidity? Problems in Alaska might be simpler from her perspective but welcome down to the real world in the lower 48 where problems are not simplistic and everyone will find out about your pregnant daughter in days.
Labels: Palin pregnancy familyvalues hypocrisy
