Tag: bailouts

Categories
insider corruption national politics & policies

A Suicide-Inducing Congress?

Say you are president. You thunder about how your predecessor’s bailouts let corporate execs keep big bonuses at taxpayer expense. That won’t happen on your watch!

And then it does. AIG bigwigs take $165 million.

So you are angry at yourself, for signing that stimulus bill with its specific language permitting TARP recipients to pay bonuses if bonuses were part of contracts made before February of ’09.

Maybe somebody should have read the legislation. So who has that job? Besides you . . . I mean the president himself. Why, Congress, of course!

Iowa Sen. Charles Grassley said he would at least “feel better” were AIG executives to apologize and then either “resign or go commit suicide.”

Connecticut Sen. Christopher Dodd and New York Sen. Chuck Schumer advocate passing a special tax to confiscate all the bonus money ex post facto.

Dodd didn’t mention that he had authored the provision specifically permitting the AIG bonuses. He has now said he’ll return the $280,000 in donations he’s received from AIG executives. Schumer was mum about his $112,000 from those same execs.

Minnesota Sen. Amy Klobuchar said, “We’ve got to do whatever it takes to make sure people that basically ripped off the American people weren’t able to profit from it.”

So is she talking about AIG . . . or Congress?

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies porkbarrel politics too much government

Homeless Red Ink

I have a prediction.

Even though President Obama insists that all of the trillions in so-called “stimulus” spending will be expertly managed and masterfully allocated — of course, to only the most deserving and stimulating beneficiaries — lots of the hastily cobbled new spending will end up being wasted.

I’m afraid I cheated with this prediction. I already have an example in hand. The town of Union, New York, is slated to receive almost $600,000 from the Department of Housing and Urban Development. Why? To combat homelessness.

Problem? There isn’t one — that is, there isn’t a homeless problem in Union. Which is why the town does not have any programs for dealing with the homeless and it has no means of administering the money that’s been flung at it. Nor did the town request the funds. Town supervisor John Bernardo says, “We were surprised. We’ve never been a recipient before.”

A less honest man would have trucked in some homeless guys and warbled, “Thank goodness we’re finally getting these funds.” But what Union lacks, Washington provides: A HUD spokesman says the new grant recipients should employ “creative strategies” in figuring out how to spend the money.

So that more than half-million dollars will find a home somewhere — anywhere but the wallets it came from.

You see why I shake my head and say, “I could have predicted this.” This isn’t change. It’s more — way more — of the same.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies

A Dollar for Your Stimulus

Remember Robocop? The clobbering of the bad guys by the cyberonic cop was a tad too bloodthirsty for my taste. And the satire wasn’t exactly as subtle as Huxley’s or Orwell’s. Still, today’s economic news makes me remember that weird game-show line, horsily bellowed throughout the 1987 flick: “I’d buy that for a dollar!”

Fast forward to 2009 and dire economic times, and the question hangs there. What can you buy for a dollar?

Answer? Subsidy.

Washington state politicians have just sent hundreds of thousands of checks for . . . one dollar each — yes, just a buck — to the state’s poorest residents.

Lots of those residents have no bank account, and thus it will cost the recipients more to cash the check than the amount of the check. So what on earth are the Evergreen state politicians thinking?

Well, there’s method to their madness.

Remember the nearly trillion-dollar so-called stimulus package Congress just passed? Apparently, there’s some rule that says if you’re a food-stamp recipient and you get at least one dollar in energy bill assistance, this qualifies you for even more federal assistance.

So, Washington legislators mail out completely ridiculous, wasteful, dollar-each checks to “prime the pump” of the federal money machine — proving that the bailouts are not only lunatic themselves, but the cause of lunacy in others.

This is Common Sense. I’m Paul Jacob.

Categories
initiative, referendum, and recall national politics & policies

Santelli’s Stimulus Referendum & Tea Party

CNBC’s Rick Santelli struck one awfully big nerve last week. Reporting from the Chicago Mercantile Exchange, Santelli said things you don’t hear much on TV, from politicians or from talking heads.

Santelli said that “the government is promoting bad behavior” with all the bailouts.

He railed against Obama’s new mortgage bailout plan, asking workers at the Exchange, “How many of you people want to pay for your neighbor’s mortgage, that has an extra bathroom and can’t pay their bills?” None answered in the affirmative.

Santelli mocked the recently passed stimulus plan for providing people with “a whopping $8 or $10” and then banking on the notion that citizens won’t save the money, but rush out to spend it.

And he ridiculed “the multiplier that all of these Washington economists are selling us.” Using their logic, Santelli sarcastically concluded, “We never have to worry about the economy again. The government should spend a trillion dollars an hour because we’ll get $1.5 trillion back.”

Most working people understand that “you can’t buy your way into prosperity.”

That’s what I liked best about Rick’s rant. He knows the American people are smarter than the politicians.

I like it that he called for a national, online referendum over the bailouts. The government won’t provide it, but I will. Go to CitizensinCharge.org to cast your ballot.

Santelli also called for a Chicago Tea Party. See you there.

This is Common Sense. I’m Paul Jacob.

Categories
First Amendment rights free trade & free markets too much government

Absurdity Then, Absurdity Now

There’s a famous quip by one English intellectual about another. “Oh, you know what so-and-so’s idea of a tragedy is: A beautiful theory killed by an ugly fact.”

Well, don’t I know it.

I wrote a column, recently, for Townhall.com, entitled “The Buxom Bailout Babes of the Umpteenth Brumaire.” In it I noted that while the Great Depression was a tragedy, today’s economic debacle, though a repeat of it, is more farce. To demonstrate its farcical nature I noted that some people are seriously talking about bailing out the newspapers, which have hit hard times.

And nothing, I assured my readers, could be more absurd than that. The point of having newspapers is to be critical of government. To have government support them would turn them into worse propaganda rags than they now are.

The trouble with this? Well, FDR, way back in the tragedy, also subsidized newspapers. Well, at least one.

Bailouts weren’t exactly the main thrust of the New Deal, but they happened. And, like most political acts, they were politically motivated. FDR was worried about Philadelphia, which was solidly Republican. The Democratic newspaper was failing.

So he bailed it out.

Simultaneously he set the IRS on the publisher of the Republican newspaper. In the next election, the area turned Democrat.

Here’s one theory that won’t be disproven: In government, it’s politics that matters.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets

A Cato Alert

President Obama suggests that all economists agree that the best way to dig the economy out of its giant hole is to dig that hole faster and harder. Too much debt? Pile on more. Consumers not “buying enough”? Tax and borrow more to spend more to subsidize more buying.

I don’t get it. Were I Robinson Crusoe on a desert island I sure would want to consume. Berries and bananas, fish, maybe deer.

But I’d also want to produce. I’d make tools to help me to gather and hunt, and to prepare and store food. Desiring shelter, I’d realize that I can’t live in a hut unless I first build the hut.

On Crusoe’s island, there would be no politicians around to tax me to death before I could finish the hut. But here in our mixed economy, there sure is.

The Cato Institute, a D.C.-based think tank, has been spreading the word that not all economists believe that the best way to improve the economy is to nuke taxpayers and producers. At Cato.org I’ve heard economists insist that bailouts have NEVER worked to stimulate the economy. Further, Cato has taken out a full-page ad in major newspapers, like the Washington Post and the New York Times, disputing the notion that the solution to the recession is a massive government spending spree.

The Cato statement is signed by hundreds of economists. Many more signed it after the ad was published.

Will it help? I have the audacity to hope.

This is Common Sense. I’m Paul Jacob.

Categories
Accountability Common Sense free trade & free markets too much government

New Prez Pleads for Common Sense

I like a president who pleads for common sense.

Here’s the story, headlined in the New York Times: “Obama Calls for ’Common Sense’ on Executive Pay.”

The president announced a salary cap for top executives working for companies garnering the greatest gobs of booty under the most recent federal bailout. The cap? Half a million bucks.

President Obama allayed a few qualms, right away. He said that “This is America, we don’t disparage wealth. . . .” And he said, “we certainly believe that success should be rewarded.”

But he does talk about the “height of irresponsibility” in Bush administration bailouts, with execs taking huge bonuses after running their companies into the ground. Who wasn’t sickened by this? Obama sees it as common sense to make sure we don’t reward massive failure with the usual rewards of success.

Still, America is also about respecting contracts. Those corporations had negotiated very explicit contracts with their execs regarding the big bucks. And — surprise, surprise — Congress wrote up the law on the gargantuan bailouts without requiring those contracts be renegotiated.

And consider: Do we really want our politicians setting non-government salaries?

This is all a side issue, though. Take the bailouts themselves. Where’s the common sense there? They do reward failure. They will not help the economy. If our leaders had acted according to common sense, the whole salary issue wouldn’t even have come up.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies too much government

Trillions I Say

I hate to talk bailouts all the time. But the feds keep throwing more misallocated trillions at the problem.

What problem? Oh, you know — the predictable consequences of all the previously misallocated trillions.

We keep hearing about fresh piles of governmental largesse being devoted to making our troubles as long-lasting and burdensome as possible. Of course, the central planners in D.C. don’t admit the necessary effects of their wastrel social-engineering ways. They would rather call it, say, “investing,” or “economic stimulus.”

Economist Henry Hazlitt pointed out that government spending does nothing to “stimulate” the economy. It merely directs “labor and capital into the production of less necessary goods or services at the expense of more necessary goods or services.”

What politicians are really doing is buying votes, keeping themselves in office longer . . . while the bad times roll.

Our calculations of red ink should consider not only the federal debt on the books, which is now more than $10 trillion, but also the unfunded liability for Social Security and other programs. Adding all that, we get something like $70 trillion or more we’re on the hook for.

I did some quick math. A stack of 70 trillion one dollar bills would be close to 48 million miles high. More than half the average distance between the earth and the sun.

Just thought I’d mention it.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies Tenth Amendment federalism too much government

Unbefreakinlievable

Now what?

Well, now the governors are going to Washington to beg for bailouts. New York Governor Paterson and New Jersey Governor Corzine have schlepped their way up to the Hill to explain that they are “cutting all [they] can” from their bloated budgets, and to demand some “relief.”

I don’t believe that the notoriously corrupt governments of New York and New Jersey have pared their budgets to the bone. Or that the only way to cut another dollar is to throw some little old lady out onto the street.

I also don’t believe that the federal government has some magical way of getting money that state governments don’t have. It all comes from the same group of us taxpayers. Unless these governors are talking about taking cash from other states, where else would the money come from? Where but out of thin air — borrowing plus the trusty old printing press?

The feds are wearing the same blinkers as these gubernatorial guys. For example, the wizards at the Federal Reserve are struggling to bring interest rates to zero — as if cheap credit in the past had nothing to do with all the misbegotten easy mortgage loans spawning the present crisis.

Now, I put it to you: If fiscal irresponsibility can be increased from mammoth to infinity, will that, at last, solve the problem? If the Fed were to drop-ship crates of cash and credit cards onto every neighborhood in America, will that, at last, solve the problem?

Unbefreakinlievable.

We need some Common Sense. I’m Paul Jacob.

Categories
free trade & free markets

When Do We Become Adults?

What is being an adult all about?

Doesn’t maturity have to do with taking responsibility for your life, for your decisions?

Of course, it is often appropriate to ask for help, to underwrite dreams or salvage the shipwrecks of them when we screw up.

But even when seeking help, you do it like a grown-up rather than, say, a whining child. You ask for the help. Politely. As opposed to assuming that other people just owe it to you, to heck with their own circumstances and priorities.

Yet government now subsidizes every big-ticket project on our every wish list, hurling more money at us when we botch the job. It’s as if they’re paying us to be irresponsible.

No shock, then, when people do in fact act irresponsibly, buying homes or making loans they can’t really afford.

Ford, GM, and Chrysler — the Big Three of American automakers — now ask for a $50 billion low-interest loan from the U.S. government. Why? So they can modernize their plants to make more efficient cars. What, just $50 billion?

What about me? I need to re-shingle my roof.  Please, government, give me a million. Just take it from my neighbors, no problem.

You know, if Chrysler had been allowed to fail back in Iaccoca days, GM and Ford may have learned a lesson — grown up — and wouldn’t think to ask for handouts today. Or need to.

This is Common Sense. I’m Paul Jacob.