News Items 10/13/08

The Treasury has come up with some solution details.  First: purchasing troubled mortgage-back securities.  That’s okay, I guess.  Second: buying mortgages, particularly from regional banks.  That’s a lot better.  Third: insuring mortgages and mortgage-backed securities.  That’s a good idea too.  Fourth: purchasing equity in a broad array of financial institutions.  That’s a darn good idea.  If taxpayer money is being used to take assets off company books, taxpayers should be in line for any potential future gains.  Fifth: helping delinquent borrowers stay in their homes.  That’s kind of vague, but it’s a good summary statement.  I’d really like to see some details on just how they’re planning on achieving this goal.  [Update]: These details and weekend-long meetings among the largest economic powers had a positive effect on U.S. markets today: the Dow gained 936.42 today, as an example.

67% of Coloradans would rather protect pristine national forest lands and not increase oil and gas protection in them. 70% thought that the high number of already unused leases was reason enough not to grant the industry new ones on public lands.  56% were intelligent enough to recognize that opening drilling up in the lands wouldn’t lower gas prices.  Just one more reason why “Drill, baby, drill” isn’t working out West: we live next to the areas where the drilling would actually occur and we don’t think it’s a good idea.

Google has come out with a 21st century energy plan (ClimateProgess’ take) and it’s darn good.  Here is their top-level summary of goals:

Our proposal will allow us to reduce from the Energy Information Administration’s (EIA) current baseline for energy use:

• Fossil fuel-based electricity generation by 88%
• Vehicle oil consumption by 38%
• Dependence on imported oil (currently 10 million barrels per day) by 33%
• Electricity-sector CO₂ emissions by 95%
• Personal vehicle sector CO₂ emissions by 38%
• US CO₂ emissions overall by 48% (40% from today’s CO₂ emission level)

The cost of Google’s plan?  $4.4 Trillion!  Ah, but the savings of Google’s plan?  $5.4 Trillion!!  I’ve heard estimates of the cost of business-as-usual, but I forget what they are.  I’ll follow up on this in the future.

A Siegel also provides a take on Google’s plan.

The effects of climate change in Colorado are being assessed.  Among them: change in river flows through mid-century. Climates are expected to migrate upward in elevation.  Supplies of water will decrease.  Demand is likely to increase.  Guess what will happen to costs.  Or we could actually do something about our climate change forcings.  See the Google plan above.  It’s a step in the correct direction.

Help 350.org send 35,000 invitations to Sen. Barack Obama and John McCain to attend the December U.N. Climate Meetings.

The hysteria over Amendment 41 continues among wonky circles. It shouldn’t, as info from the Colorado Independent Ethics Commission came out last week. Scholarships, insurance policies and dinners are allowed, just like A41 supporters have maintained.  A41 banned gifts from lobbyists and anything over $50 in value from non-lobbyists.  The Colorado Supreme Court has refused to look at A41’s constitutionality until the law was applied or enforced.  I think the intent behind A41 was apparent to voters.  I don’t think the Commission will whittle away the intent, as opponents claim.

Arctic sea ice volume likely set an all-time minimum this year.  While the areal extent reached the second lowest value on record, the volume of the remaining ice was less this year than last.  It’s not hard to figure out why this is.  A record low areal extent last year meant the ice that formed last winter was new and thinner than ice that formed over decades or longer.  That ice melted easily this summer.  The small area of thicker ice?  It melted more this year because of the warmer ocean waters underneath it.  As those waters get warmer year after year, the ice above it has less long-term viability.  The NSIDC should continue to verify the final volume value for 2008.

Republicans have maintained their stranglehold on local and state politics with their GOPAC program – it trains folks how to push fringe policies to the public.  That’s how they’ve gotten so many extremists in positions of power.  Want to counter it?  Throw a little something toward Progressive Majority.

What does it mean to be fiscally conservative?  CONServatives certainly don’t know the answer.

Two Big Reasons the Financial Crisis … Isn’t

Well, well, well.  The more the financial “crisis” and the Bush administration-led “solution” play out, the more the whole thing stinks.  How much does it stink?  Enough so that there should be no way any member of Congress, Democrat or Republian, votes to give the Bushies the power they’re so desperately seeking.

First, it’s not so much of a crisis as Bush would have us believe.  Bush’s cronies have been sitting on this legislation for months.  Which would indicate prudence except they’ve been talking about how good the economy is doing and how stable it is this whole time.  This plan could have been sold faster if they said at any time that the economy was starting to look weak because of the housing and financial institution crises.  More to the point though, the Bush administration waited for months while the financial markets got slaughtered.  Why?  Because they didn’t want another one of their failures to go public prior to this year’s election.  Remember, many Republican Representatives and Senators came out over the weekend saying Democrats shouldn’t try to score political points with this crisis.  Their faux concern rings even more hollow now that the leader of their party did just that while allowing major corporations to fail and allowing our economy to sink further than it otherwise would have.  They should work on cleaning up their own house before looking into their neighbors’.

Second, not only does the Bush administration expect taxpayers to foot the bill of foreign banks with bad debts, they want tax dollars to go to banks who aren’t even in trouble!

You have to remember, these are not all weak or troubled firms that own mortgage-backed securities. A lot of them are very successful banks and investment houses that have done very well, have been responsible, are holding performing assets that have value. They were not necessarily irresponsible players, and so you have to be careful about how you deal with them.

Why does the Bush administration want American taxpayers to help banks who don’t even need it?  Because their solution doesn’t address the real crisis.  There isn’t a quick fix to the mess we’re in.  Banks don’t know how many of their assets are bad or what they’re actually worth.  The legislation Bush wants passed can’t fix a problem that remains undefined.  Democrats need to stand firm and wait for more solid information to become available.

What Do You Want?

As the Bush administration continues to expect taxpayers to shoulder the burden of the out of control gamblers on Wall St., maybe a small dose reality of the options being considered should be presented.  So here is my take.

You can believe the Bushies when they say Congress should do something about the crisis that Bush’s allies created without due consideration of the ramifications.  You can believe that this crisis is so big and so bad that nobody should have any oversight of the Treasury Secretary’s decisions on which bad assets taxpayers get to assume.  You can believe that Bush and his cronies have your best interest in mind as he saddles the country with up to $700 billion (for now) of additional debt and leaves irresponsible, untrustworthy executives in control of their firms.  You can believe these things while the Bush administration makes absolutely no attempt to protect the taxpayer or as it makes no attempt to improve the environment for homeowners or small business owners.  You can believe they’re protecting America by assuming foreign banks debt.

By doing so, of course, you then support the following.  You don’t want to shift our energy from fossil fuels to renewables.  You don’t want to address global warming.  You don’t want any investment in our country’s infrastructure.  You want the next generation to live under a system that pays billions of dollars per year on interest on the debts that you incurred.  You want Social Security to fail.  You want Medicare to fail.  You don’t want any meaningful change to our broken health care system.  You don’t want any improvements to our education system.  You don’t want America to move any further into the 21st century because we’ll still be paying off our 20th century debts.  You want to cover foreign bank mistakes as well as domestic bank mistakes.

Here is the thing nobody is talking about: if regular Americans are on the hook for multiple Trillion dollar games (i.e. Iraq, Wall St. rip-off, hurricane recoveries, etc.), there’s no money for anything else.  Republicans want government to fail.  They’ve purposefully created a culture where higher taxes are forbidden.  At the same time, Republicans have created the largest government spending programs in our history and now have overextended America’s financial obligations to such a degree that something has to give.  Do you think Republicans are going to allow the War (“defense”) budget to be cut?  It represents, by far, the largest expenditures of your tax dollars.  If the government doesn’t collect any more money, programs will have to be cut.  If “defense” is off the table, Republicans have been honest about their goal for years: no social programs.  A small group of extremists are working very hard to force those programs to be cut out of the budget.

So we can pay for Wall Street’s immoral gambling problem.  Or we can hold a small group of executives and government officials responsible for their long history of mistakes and get back to work ensuring America can continue towards a prosperous 21st century future.  What do you want?

***

[Update]: Barack Obama recognizes what I’ve described above.  Health care, energy, education and everything else will have to take a back seat if Bush’s immoral bailout goes through.

Front Seat: Economic Concerns

The big news continues to be the Bush administration’s response to the collapse of the U.S. financial sector and Americans’ response to that.  Yesterday, I outlined the “rescue plan” and offered some thoughts of my own and others’ as well.  Today, I’m reading disturbing things in the corporate media about the “rescue plan”.  In a nutshell, a number of overpaid economists who were dead wrong about the state of the economy leading up to the stelllar failures are presenting this as an either-or situation.  That approach is incredibly narrow-sighted, especially given some of the alternative solutions I wrote about.

Don’t get me wrong: we are all facing a crisis that could get a whole lot worse.  I duly recognize that fact.  What counts moving forward is how we deal with that crisis.  Adding $700 billion to the national debt and taking one point of economic growth per year away from the next five years is the wrong solution.  CNN’s Paul LeMonica’s view is we can choose between that solution and doing nothing.  Seriously, that’s all Paul (and others!) can offer?  How about enforcing some penalty on the gamblers responsible for this crisis?  Once again, the richest among us are perilously close to getting off scott-free after making the worst possible decisions and sticking the rest of us with their gambling debt.  The fact that folks like Paul offer up only two extreme solutions to this crisis is indicative of how scared they are of the monied interests of Wall St.  They should be afraid of the interests of Main St.

What’s most insulting about this offering of extremes is the warnings accompanying them.  Jobs might be lost, people might lose their homes, incomes could fall, blah, blah, blah.  Hey!  Wake up, pundits!  All that has been happening.  Bush’s Republican government has created the fewest jobs in 8 years’ time since WWII.  Foreclosures are occurring at record rates.  Real incomes haven’t increased in 8 years’ time.  Not doing anything about the Wall St. crisis won’t create some new economic reality for Main St.  It’s Main St. that has had to deal with their own economic crisis and now that Wall St. is feeling the pinch, suddenly it’s time to roll out the rescue plans.  On Main St.’s back, I might add.

Meanwhile, the markets contine to roil.  The dollar fell today, oil spiked by $20 per barrel (the highest one-day gain ever) to $130!!, and the Dow is down 370 points again, just to name a few.

2008 Economic Crisis – Conservative Economics Have Failed

The American taxpayer is being tapped for up to $700 billion (for now) to cover the bad bets of unregulated financial entities for the next two years.  There’s a lot to talk about in that one sentence.  I’m going to start by pointing out that too many companies were gambling.  They lost the bet, but taxpayers are being called upon to pay up.  Read this carefully: that is immoral.  It is even more immoral in the face of Bush’s administration refusal to offer homeowners any kind of possibility to keep their homes over the past two years.  It’s the main pillar of Republican ideology: you’re on your own.

I’ve heard and read that the government could recoup the money.  I have heard zero details on how that could happen.  It’s a vague request for trust by this Republican-led government that needs to demonstrate it’s worthy of that trust.  Remember, Bush’s administration has received everything it has asked for for seven years, from both Republican and Democratic Congresses.  That includes supplementals for the invasion and occupation of Iraq – totaling some $600 billion so far.  That includes tax cuts for billionaires and the largest corporations.  Now Bush and his cronies want Americans to assume the debt from Wall Street’s gambling habit.  What about what Americans want, including keeping their homes, their jobs, their wages, their health care, and their hard-earned money.  We’ve heard for years from conservatives that Americans should be able to keep their money.  Now conservatives want Americans’ money to prop up their irresponsible corporate allies?!  Even though conseravtives’ ideological economic policies have failed on every level, we’ll never hear them admit it, despite their greed for our money to cover for those failures.