The Bailout: Aftermath
Alright, my energy is back up on this bailout fiasco, so let’s jump back in. Shall we?
As of right now, the Dow is below 9000, down more than 400 points on the day. Credit markets have seized up to the point that commerce, growth, and even everyday car loans are tougher to get. The economy is slowed down and injured because the fools in D.C., cloaked in their Ivy League wisdom, passed a bailout that didn’t fix the problem. Rather than lend surviving financial institutions money to supply a lending market, they throw it at leveraged sinking ships. One is reminded of throwing a rescue net at a fat man sinking into a tar pit, except the net is tied around your leg. Even if you save him, he’ll never be the same, not to mention the risk of getting pulled into the pit with him.
The futility of our current scenario is fueling the always dangerous over-reaction in our markets right now, and temporarily (hopefully) devastating retirement funds and nest eggs everywhere. Wasn’t the bailout supposed to fix all of this? Wasn’t a mortgage quarantine the absolute answer? Of course it wasn’t. It was never the real problem to begin with. What are the problems, then?
At the front of the line is our worthless government. Our government, through the auspices of over a decade of ACORN influence and all its racist undertones, has forced banks to lend to subprime borrowers if they wished to merge, via the Community Reinvestment Act of 1977. Then, our government leadership, led by Chris Dodd, Barney Frank, Barack Obama, Maxine Waters, et al. received financial contributions from Fannie and Freddie to deny any problem with the subprime/leveraging one-two punch. Several pleas and attempts were made to create an oversight board, or at least investigate the practices that led Franklin Raines, CEO of Fannie and Harvard Law graduate, to infamously declare that homes are a “zero risk” investment. Those who acted as shills and mouthpieces of Fannie and Freddie, Wall Street, and ACORN should lose their seats/jobs. They, who have such terrible judgment and/or character, have no place making decisions for us. I’d also like to suggest that any legislator who has been part of this bailout, the failed amnesty bill, the carbon cap and trade bill, or any other effort to force extremely unpopular laws down our throat (sometimes even in secret!)
Next up is the Wall Street firms, whose one time resolve against pressures to lower standards melted in the face of windfall profits. Leveraging horrid mortgages on world markets, and overvaluing assets due to perceived future value are just some of the strangely ignorant practices at these centerpieces of Wall St. Seriously, would you invest with a firm who told you to your face that they are on so much risk with so little actual cash that any problems at all would fell them instantly? How about if they told you that their actual assets were nowhere near what they claim, but its cool because they aren’t selling them yet, and they’ll certiainly be worth more later? What if they admitted that the CEO and the board really don’t care because they’ll get nine-figure packages regardless of the outcome? None of those things are dishonest admissions, but none of them inspire confidence either, do they? I read today that the company that rebuilt the Minneapolis bridge over the Mississippi won 27M in a bonus for being 3 months ahead of schedule. That story made me happy, but the dark cloud is that Franklin Raines made twice that for what he did to Fannie Mae. Was it worth what you caused, Frank? How many bedrooms are in a mansion built on the ruins of ten million financial futures and broken dreams? Its time to make these CEO deals public, so that the shareholders can sell off a stock the next time a CEO is in line to make 100M dollars to sink the ship. We can’t have the government messing with private contracts, but the shareholders are far more important than any Board of Trustees at a publicly traded firm, and they wield mighty sway when upset.
Last but certainly not least is the borrowers. The people who blindly (or not so blindly) signed on to loans they could never sustain bear a great responsibility for this mess as well. Buying into the hype of the entitlement culture, they began to believe that they “deserved” a home, as if there is a “right” to homeownership. Let me tell you, there isn’t. I don’t have the money to pay a mortgage, so I rent. I don’t believe I am owed any property by anyone, plus I don’t want that kind of debt on my name when I know I can’t handle it. Buying into the notion that we deserve a better lifestyle than our means is a dangerous road. I know people who live in large houses with three mortgages on them. Three! There is no equity or wealth to speak of in that property. There are millions in this country walking around with a negative net worth. To put it another way, they would profit if they passed away. Its shameful that these sad souls have forgotten the lessons of their elders, who knew how to save and sacrifice now for survival. Now, the borrowers must pay their debts. Foreclose their homes, liquidate their assets, and make them start anew. Its only fair, because the alternative is what our government is trying to do: spread the penalty evenly amongst the guilty AND the totally innocent.
All three culprits should feel real pain for this mess that has destroyed so much wealth in our world. Greed, ignorance, and corruption need to be exorcised from the system before the economy recovers. This bailout doesn’t remove any of those issues, and so it is a bailout, and not a fix or resolution. Our 10% approval rated Congress has certainly lived up to its name, hasn’t it?
A New Topic
Blech, the bailout bill has passed, and I don’t have the will to eviscerate it any longer. Onward, then!
We’ve known this for a long time, but the Global Warming/Climate Change debate has ceased to contain any real science, and has become a political talking point on both sides of the aisle. This absolutely needs to stop, for the good of our country and the world (in that order).
I do not have a huge stake in this debate, except that I am determined to fight against the tide of policies that will stem from the most recent hysteria in the media. I won’t spend a whole lot of time on the basics, as we all know them by now. There is some force(s), it is said, that is warming our planet beyond normal temperature cycles. This force, if we don’t take huge action, will destroy our planet enough to alter (and presumably worsen) our way and quality of life. We have to use the government of this country and the rest of the world to force new energy technologies and policies (using taxes and other pressures) to ensure our survival and the health of the planet. The force is man’s pollution, and we have to change it right now to save ourselves.
Now, there are several debates raging within those statements, such as whether man is the true force, or the Sun, or oceans, clouds, etc. Also, some say that global temperatures aren’t changing, and others still cling to the fear of the next ice age. Yes, there are still relics that believe our death lies in global cooling. Isn’t that odd, and instructive all at once? They urge many measures to increase our global temperatures so we might be saved from the coming crisis, all with the same ferocity of the newer warming scientists. And yet, two decades later, we’re arguing about the categorically opposite crisis?
I realize that pride and ego are huge faults in our society, and the problem is merely magnified in the government, where its members were literally chosen to lead their peers. Its hard for the government to self-evaluate at any point, or to look beyond the scope of about 12 months. Simply consider the war in Iraq:
The huge support for action after 9/11,
the huge support in Congress for the President and latest intelligence in Afghanistan,
the huge support in Congress for the President and latest intelligence in Iraq,
flagging support for Iraq after it wasn’t easy or quick, relative ignorance of Afghanistan,
lack of support for Iraq in quagmire status, complete forgetting of Afghanistan,
resistance, then support of Iraq based on surge’s success, rememberance of Afghanistan,
new focus on Afghanistan as “the real front” now that Iraq is likely drawing to a favorable close.
(Note: Not addressing any Iraq War debate right now. If you disagree, let it go this one time.)
Our politicians play a game of Panic Button every single day, it seems. The GW/CC debate is not different in that we are trading one crisis for another on a regular basis, and they also share in common that the debate has been completely displaced by a simple partisan attitude that replaces facts with party registration, and turns thinking citizens into likely voter statisctics. “Deniers” (as in Holocaust deniers, of all horrid things) are painted as George Bush clones and planet haters, and believers are painted as hippies and Sierra Club, drum-circle druggies.
Let me be the next (definitely not the first) to stand before you yelling “STOP”! The simple fact that we very recently thought an Ice Age would kill us is very direct evidence that we don’t understand how our climate works. Put another way: we trust meteorologists and climatologists to tell us what the entire Earth will do in 10, 20, even 50 years and beyond while they can’t tell us if its going to rain tomorrow? Can we just admit that we don’t know? It takes courage and confidence to remember that we don’t know everything, despite what the news and scientists tell you. I promise they wouldn’t be scientists if they knew it all, because there wouldn’t be anything to study.
Like I said, I don’t win or lose based on the fictionality/reality of GW/CC. Nobody does. A policy of running amok with legislation will not fix anything, however. What if Global Warming turned out to be worse than we’d feared, yet we had taken every measure prescribed during the Global Cooling “crisis”? Where would we be then?
I suspect some view this as an opportunity to use government to take freedoms and shift toward socialism, but this article is not about them. Most are simply swept up in the tide and fervor of partisanship, and they have forgotten what science is actually about. You make a hypothesis, and test it with experimentation. The results validate or invalidate your hypothesis. Then, you make another. Writing Armageddon scenarios in Time magazine based on computer models has little merit other than ginning up NSF dollars for more research grants on the matter. Model is a euphemism for theory, as in guess, or unproven. Also, there is no quorum at which theory becomes fact. 800,000 unproven theories amount to nothing without proof. One cannot overwhelm reality with superior numbers.
Drop your party’s platform and stop accusing those with differing viewpoints of lying. They are under the same spell you are. Let the scientific debate rage in the scientific community, and don’t let politicians ruin it again. Its hard, but admit that you don’t know. Remember the number of “coming calamities” that have never come to pass in our lives, and use that prism to remain calm when the next one comes out of the media factory. Its awfully difficult to sell papers or win viewers without crisis, so keep that in mind when the headlines claim our world is on the brink of sure destruction.
Its important to consider every theory on GW/CC, but also to remain impartial until the facts come out. Also, if the facts can’t be obtained (which may be the case), choosing one theory and fighting for it is as foolish as betting your entire savings in a horse race by choosing the horse whose mane is best trimmed. It may be the determining factor in how fast a horse runs, but it might not be, and the riskis high. Remember, our lives may be at stake one of these days, and BETTING ON THE WRONG SIDE WOULD SPELL CERTAIN DISASTER!
Just kidding.
A Failure in the Senate
The Rebublican Party is poised to lose a lot of ground in these coming elections, in the House and in the Senate. Trouble is, they completely deserve it.
Given a mulligan on the bailout bill (changing the name to rescue isn’t fooling anyone), Senators simply added tons of earmarks and extra spending to fulfill everyone’s crooked, ridiculous agenda, and added very little in the way of fixing the actual holes in the bill. This is especially damaging to McCain, whose run against this type of leglislating his entire career. The misguided Senate is telling us in no uncertain terms that we aren’t smart enough to understand what is happening, and so they go against the will of their constituents (and over 100 economists of all political persuasions) in pursuit of this disastrous bill.
Now, the House Republicans are the final bastion of resistance to this bill once more, and they must remain upright for the good of this nation. When other parties and sentiments fail, hopefully these men (and women) stick to their principles and defeat a bill that the Democrats are too cowardly to pass on their own, even though they have the votes by simple mathematics. Its even been reported that the Democrats allowed its members in tightly contested races vote against the bill! Doesn’t that scream “wildly unpopular”?
You cannot right a wrong simply by removing the consequences of faulty judgment. We don’t release murderers from jail if their victim is nursed back to health. We don’t forgive arsonists who fail to burn down the entire building, and allow them to roam free. We shouldn’t bail out anyone in this mess. Lenders should suffer, risky borrowers in over their head should suffer, and government officials (Dodd, Reid, etc.) who covered up this burgeoning crisis should suffer. Accountability is key, and this bill lets everyone off the hook without fixing the system.
The term bailout itself carries a little irony with it, actually. This bill is the equivalent of fervently bailing the water out of a sinking ship while it pours in through holes in the hull. All to keep the USS Status Quo afloat a little longer.
