Monday, December 28, 2009

THE NEW REPUBLICAN PARTY - TEA BAGGERS!

Before we give any credit to the “new” Tea Party, what apparently the Republican Party is destined to become, let’s remember just exactly who these people are and what their politics have historically been. Before your friends embrace this new political force remind them of what their actions have been in the past. At the core, they are against government, taxes, and they’re for war and U.S. bullying of foreign adversaries and allies. One might say they put the “con” in conservative. To be accurate, they’re fooling themselves as much as anyone else. I think they actually believe their hype. They’ve just really never examined the end game of their policies. They ignore history and reality.

These are the folks who labeled the Clinton 1993 Budget Reconciliation Act, which raised taxes on the wealthiest Americans, as government intrusion and the catalyst that would lead to a seismic recession (the sort we’re seeing now after the Bush tax cuts to the wealthiest in 2001). They are anti-government, anti-regulation (the kind that led to the financial meltdowns in too big to fail banks, and too big to fail corporations), the sort we’re now dealing with because of the excesses during the Bush free-market years. They were the same folks who were trumpeting the need to convert the Social Security Trust Fund into stock investments (just before the crash of 2007). They’re all for engaging in war (for any reason) in Iraqi, Iran, Viet Nam, Korea, Central America, South America…wherever there is a government (whether elected through a democracy or not) to illustrate that WE ARE the only military superpower. They are the champions of pre-emptive war. It’s good enough for them to justify an aggressive military action just because they conceive threat from any source, justified or not. “Walk softly and carry a big stick” has been replaced with “shoot first and ask questions later.”

The Tea Party has its roots in the South, where they believed slavery was worth initiating a civil war, where as late as the sixties and seventies they were standing in the doorways of public universities to prevent African-Americans from attending schools of higher learning with white students. They are of the political continuity of George Wallace, Lester Maddox, John C. Calhoun, Bull Connor (the Alabama Sheriff who turned fire hoses and dogs on civil rights protesters) and Dick Armey.

They have an unblemished record as being wrong on civil rights, evolution, stem cell research, climate change, and if we could transport them back a few centuries I believe they would have been the same people who thought the sun revolved around the earth, and that the world was flat.

They’re bad judgment has been duly illustrated to have been drastically wrong. Had they prevailed in redirecting the Social Security Trust Fund in the stock market in the George W. Bush second term millions of senior citizens who would have planned on retiring in the last three years would have had their futures irrevocably changed. They’re prediction that the fiscal policies invoked by the Clinton Administration would lead the country into a recession proved to be 180 degrees incorrect. Those policies led to the longest period of expansion in history. Whereas the free-market, laissez-faire, cut taxes for the wealthy policies of the Bush administration led to banks making ill advised loans and the payment of massive undeserved bonuses, along with the deepest recession since the Great Depression. By the way, only the last minute intervention of the Bush Administration, followed by the massive stimulus of the Obama Administration along with the vigorous re-installation of federal regulators like the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Federal Reserve prevented this “Great Recession” from becoming a “Greater Depression.”

As Nobel Economist Paul Krugman put it in his December 28, 2009 New York Times Op-ed, “now that their policies of tax cuts and deregulation have led us into an economic quagmire, their prescription for recovery is – tax cuts and deregulation.” Or, as a good friend of mine once described his hunting dog when he said, “he has lighting speed but, no since of direction.” If we ever follow these revisionists with their “charge backwards” philosophy we’re going to find ourselves in the same place. With the rich getting richer, the middle class disappearing, and the poor among us swelling. True, a rising tide lifts all ships…but, the rising tide is the base of the economy, not the apex. If we ever learn to lift the poor and middle class the wealthy will discover it will improve their lives too.

Before anyone joins this merry band they better recognize exactly where this group of drunken soldiers is leading them. And, it’s not to a better or higher standard of living that we’ve become accustom to. It’s a direct route to returning to the also-rans. These folks are as dishonest with themselves as they are with the rest of us. They ignore the benefits of an organized society where a democratically elected government oversees the activities of its members (citizens) to insure everyone plays fair and respects each other. If we didn’t need government regulations we could do without street signs, speed limits, air traffic control, paved streets…at least streets that weren’t controlled by trolls collecting tolls for passage.

What they purpose is to “water the tree of liberty with the blood of patriots”…but, to follow them will lead to something totally different!

Monday, December 21, 2009

SO YOU WANT TO BE A LIBERAL

I sympathize with my ultra left liberal friends. I’m not happy about the result of the healthcare bill in the Senate. I’m disappointed in the Democrats who allowed a few goofy Democratic Senators, and one goofy Independent Democratic Senator, to hijack what should have been…and, could have been the kind of healthcare reform that should have been on the mark from the very start. But, the stars weren’t in alignment.

But, truthfully, the President told us what to expect when he campaigned for the office he now holds. He said he wanted to change the culture in Washington. And, I’ve got news for you…he’s living up to that commitment that he made. If Lyndon Johnson were president rather than Barack Obama he (President Johnson) would have knocked some heads together to get this thing done right. But, that’s not what this president is attempting to create. This president is going to be, I think, two things…patient and persistent. That’s the new way.

If we’re going to be different as liberals than the R’s are as conservatives…we’re going to have to get tougher than our opponents are. And, I’m not talking about tougher the way Republicans were when they forced absolutely absurd policies on us as a country. The R’s forced a tax break for the rich on us that reversed what would have resulted in a $2.4 trillion dollar surplus which instead, resulted in a $10 trillion dollar debt. We are going to have to commit ourselves to this new culture. I think this new culture will have to possess the patience and persistence that the president is demonstrating. We’re going to have to act like adults rather than spoiled children. So, we didn’t get what we think we needed for proper healthcare reform. Rather than holding our breath until we turn blue, we need to commit ourselves to pressing for additional work on the bill immediately. I mean before the ink has ever dried. We need to make it clear to the Democrats who weren’t playing on our team that we’re going to run real Democrats against them. Lincoln, of Arkansas, Landrieu of Louisiana, Nelson of Nebraska, and Lieberman need to know we’re not taking their defection and deal making lightly. They need good strong competition for their sacred senate seats.


We cannot sit out any election ever again…ever. We’ve got to get those $10 and $20 internet donations back into action. We need our fellow bloggers to saturate the internet with the facts that the voters need to know in order to throw these Democratic actors out of office and elect real authentic liberals and progressives.

I love Kos, Fire Dog Lake, Ed Shultz, all those liberal voices and bloggers. But, we just got our foot in the door. No, we didn’t get what we needed…but, we got what we needed to get a good start. Now is not the time to stick our heads in the sand…now is when we need to prove we’re a force that’s not going away and is a force to be reckoned with.

If we don’t, there’s another group of radicals who will be persistence although not patient. The Tea Party…the “tea baggers” (How great a name for them is that?). Get tough! Be patient and persistent! We’re not going away and we’ll be at the voting booth and donation windows in every election from now on!

Friday, December 11, 2009

MAKING A DIFFERENCE

Things are happening regarding banking regulation. The most remarkable story emerged the week of December 7th regarding what I think is a very brave Georgia woman who worked for Bank of America, Jackie Ramos. Ms. Ramos was fired by Bank of America after she took a stand against the bank's policies regarding the workout of credit card loans. Her descriptions of the bank’s insincere efforts to act like they want to modify the loans of customers who are experiencing severe credit problems highlight the real intention, to generate more fees and keep the customer in debt.

She gives her, first person, experience in accessing $15 "convenience" charges and $39 over-the-limit fees on helpless customers. Then, of course, Bank of America (and, don’t fool yourselves…BOA is not the only abuser of these practices) will represent to the U.S. Government and bank regulators that they are “breaking their backs” to help these customers who find themselves service charged into oblivion and paying 30%...excuse me (as Ms. Ramos puts it) 29.99% interest rates on their credit card accounts.

Make no mistake about it…the only thing these “too big to fail” banks are breaking their backs doing is figuring out how to get themselves back to the position of paying obscene salaries to their top few executives, all the while telling their own, lower paid employees, that the economy won’t allow them to give good raises or hire additional workers, or get back to the purpose banks exists for…lending money to credit worthy borrowers. Regulators in Great Britain are onto this scam and have decreed that all bonuses over approximately $40,000 will be taxed at 50%. Having been in a position that paid large bonuses, I don’t see this as onerous on executives at all. It should encourage employers to construct the salary of their employees on the basis of a better base, but a fair reward for the performance of the employees work. However, I don’t see where the likes of “to big to fail” banks or large corporations who pose a systemic risk to the well being of the U.S. economy are in a position to demand an obscene bonus when many of their profits are only due to the bailout of AIG, a corporation who insured the risk these banks were taking and that ultimately failed.

If you haven’t seen Ms. Ramos’ YouTube video, I recommend you watch it at http://www.youtube.com/watch?v=a5E0WNO7e_Q&feature=player_embedded.

Then, five House Democrats called for a return to a Depression-era law, known as the Glass-Steagall Act, that separated Wall Street investment banking from commercial banking.If the law is enacted, it would give banks one year to choose between being commercial banks or investment banks. The nations biggest -- those now commonly referred to as "too big to fail" -- would be broken up. The reason this makes since is that commercial bank deposits are insured by the FDIC. Consequently, the blurring of investment and commercial banks provides a window for the investment bankers to have access to insured deposits to gamble in the stock market. A classic heads, I win, tails you lose scenario.

The amendment's five co-sponsors -- Maurice Hinchey of New York, John Conyers of Michigan, Peter DeFazio of Oregon, Jay Inslee of Washington, and John Tierney of Massachusetts - want to restore the Act which originally passed in 1933, which also prohibited commercial banks from underwriting stocks and bonds. The act was repealed in 1999 and unfortunately signed into law by President Clinton, although the energy behind the repeal was Senator Phil Graham, of Texas. Mr. Graham foresight into the economic future has been consistently wrong. He predicted the Budget Reconciliation Act of 1993 would send the economy back into a deep recession. The actual result was the longest period of expansion on record.

The amendment would seem to have the backing of former Federal Reserve Chairman Paul Volcker who is one of a number of financial experts that are suggesting a return to Glass-Steagall is necessary going forward. In addition, The Wall Street Journal's editorial page, much to my surprise, also endorsed the concept in a recent editorial as a way to "reduce moral hazard" and "limit certain kinds of risk-taking by institutions that hold taxpayer-insured deposits." Unfortunately the Wall Street Journal doesn’t realize that insured deposits aren’t tax payer funds they are premiums assessed on member banks with the “full faith and credit of the U.S. Government.” There’s a big difference.

As a result of the repeal of Glass-Steagall big banks began getting even bigger. The four largest in our country -- Bank of America, JPMorgan Chase, Citigroup and Wells Fargo - now hold more than half of the nation's mortgages, two-thirds of credit cards and two-fifths of all bank deposits.

Because the deposits of these banks are insured by the FDIC, there's growing concern that they would have little restraint in making risky bets through their investment subsidiaries because they know if they lose, the FDIC and potentially the U.S. Treasury will ultimately bail them out.

Volcker also admonished the financial community this week delivering a jarring message to high-level bankers and regulators at an exclusive meeting in Sussex, England. "Has there been one financial leader to say [executive pay] is really excessive? Wake up, gentlemen. Your response, I can only say, has been inadequate," he said, according to the Times of London.

Volcker, a veteran of the financial world and currently chairman of President Obama's Economic Recovery Advisory Board, spoke this past Tuesday at the Future of Finance Initiative conference, organized by the Wall Street Journal.
Amid throngs of bankers arguing that new regulations should not impede on financial "innovation," Volcker pushed back, accusing Wall Street's increasingly complex financial products as useless to economic growth. In demeaning the meager contributions of the big banks, he named the ATM cash machine as the most successful financial innovation in the past 20 years, the Times reported.

Financial reform is coming, and soon, because if it isn’t we’re going to go through this exact same exercise on down the road…only it’s going to be more severe the next time and every time thereafter.

Sunday, December 6, 2009

FOCUS ON THE MIDDLE CLASS

I’ve harped forever that the key to a robust growing economy is a simple formula. Focus on the middle class. Targeting tax cuts to the wealthy is fool’s gold, and not more than a deceitful ruse. If you want to grow the middle class with tax policies write them to reward creating jobs at the bottom and penalize large salaries at the top of the income charts. Tax cuts for a guy without a job doesn’t encourage anything, and targeting tax cuts for the upper 5% of income earners doesn’t create jobs…it just pads the bank accounts of the wealthy.

Elizabeth Warren (Chair of the Congressional Oversight Panel created to oversee the banking bailouts) wrote this past week about the shrinking middles class. She is well respected and her advice is worth paying attention to. She wrote, “In the boom of the 1960s median family incomes jumped by 33%. But the boom of the 2000s resulted in an almost-imperceptible 1.6% increase for the typical family. Wages of the average fully-employed male have been flat since the 1970s. But core expenses kept going up. By the early 2000s, families were spending twice as much (adjusted for inflation) on mortgages than they did a generation ago. They also had to pay twice as much to hang on to their health insurance. But higher housing and medical costs combined with new expenses for child care, the costs of a second car to get to work and higher taxes combined to squeeze families even harder. Even with two incomes, they tightened their belts. Families today spend less than they did a generation ago on food, clothing, furniture, appliances, and other flexible purchases.”

She goes on to say, “While the middle class has been caught in an economic vise, the financial industry that was supposed to serve them has prospered at their expense. Top executives kept their jobs and retained their bonuses. Even though the tax dollars that supported the bailout came largely from middle class families. Families understand with crystalline clarity that the rules they have played by are not the same rules that govern Wall Street. They understand that no American family is ‘too big to fail.’”

Ms. Warren is a Law Professor at Harvard in addition to serving as Chair of the Congressional Oversight Panel. She is an expert regarding public finance policy and her assessment is spot on. I know lots of us on the left are baffled at the cluelessness of the upper class to recognize that a growing middles class isn’t just good for those in the middle class but, it’s exactly what creates more wealth for the upper crust too. More customers…more business! How much easier can it be to see?

Unfortunately the sin that blinds the wealthy from learning this easy economic lesson is simply GREED. Greed leaves you completely without vision or imagination. Fortunately for us…a democratically organized government that combines the best of capitalism and socialism is the counter balance to blindness by a wealthy minority. A tax policy that will reward the creation of jobs and prohibit vulgar executive compensation can be the best medicine for curing an ailing economy and restoring a middle class that will once again leave us the envy of the world.

Everybody does better…when everybody does better!

Tuesday, December 1, 2009

WAR AND HONESTY

I don’t like our options in the war in Afghanistan. I, like most Americans, believed in what we did when we committed to engage the enemy after the events of September 11, 2001 in Afghanistan. However, that opportunity disintegrated when the last administration lead by the former weak excuse for a president, also with a vice president who can only be categorized as evil, along with a defense secretary who acted as any accomplice does in supporting a criminal who he serves, in this case the vice president. However, I believe the assessment given to our country this evening, December 1, 2009, was an honest message to what we as a nation face.

I am most interested in withdrawal. The fact that at least a date was set is the message I wanted to hear. Prior to this evening I told my friends I actually didn’t care if the president committed 100,000 troops if it meant that it was eventually going to lead to our withdrawal. So, I’ll give the President time to follow through on his strategy.

What I most appreciated most was his acknowledgement of my point of view. That I think there’s nothing to be served. My belief is that Afghani’s must fight for their destiny. I don’t think al Queda is likely to return to Afghanistan from Pakistan…because the nuke’s are in Pakistan. This President is a thoughtful guy. If I’d have ever believed, or been convinced, that Bush or Cheney were thoughtful I’d have give them some consideration. But, I like most of you always got the impression that I was never being told the truth. That whatever the reason for invading Iraqi after retaliating in Afghanistan was for a reason beyond the notion that Iraq was an imminent threat.

My preference is to pull out…but, the President convinced me to given him the consideration someone in authority deserves if they are approaching a problem thoughtfully.

I like it that he gave this fateful decision in the front of cadets at West Point. And, their reaction, after the address, leads me to believe they appreciated his approach too. They were intent, although some were clearly sleepy (not something anyone should hold against a college student especially one at a military academy). The picture I will be left with is one cadet who was reaching over a couple of lines of his classmate with his hand extended to shake the President’s hand…although this hand was trembling. I think that’s the way those of us who believe in this President are feeling. We are ready to follow him…but, we’re trembling at what may await us.

God’s speed Barack Obama.