Entries Tagged as 'Economy'

Mr President, now is the time to be a president.

There is a good article on CNN.com by Donna Brazile on what President Obama could (and should) do to get the economy back on track.

I think she’s got the right idea, but I think she really stops short of just outright saying that the problem isn’t necessarily Obama’s failed programs, it’s his failed leadership.

Now is not the time to sit on the fence Mr President; you’ve tried to build a consensus with congress (you failed to do that when your party had control of both houses, and you’ve continued to fail to do that now that your party doesn’t)… it’s time for you to lead — or to step aside and let someone else do so.

The problems this country has are solvable; but every day we wait to start moving down a path that is likely to put us on the road to get American’s working and to pay down the enormous debt that Republicans and Democrats alike have saddle the current (and future) generation(s) with we simply make the problem harder — and at some point there will not be a solution, the US will simply drift into the fray of third world countries never likely to regain it’s position as a real world leader again.

So, Mr President — be the president; make the hard choices; and move this country forward… it’s not the time to be a politician or a two term hopeful, it’s time to be a president.

 


4 ways Obama can take control to get America back on track by Donna Brazile on CNN.com

Originally posted 2011-08-17 02:00:42.

Tea Party

The Tea Party has been holding a number of rallies to make people aware of how government is misusing their tax dollars…

Damn straight!

Remember, the wars in Iraq and Afghanistan were not in the budget; the wars were entered into based on lies told to the American people (and the House and Senate — which you would have hoped would have been a little more savvy than the average taxpayer and ask for proof).

So let’s start by getting that nearly trillion dollars that was misappropriated ack; from the defense budget (after all — gotta cut to pay, right Tea Party — and best to cut from the same programs that used misappropriated money than a program that didn’t).

Am I serious… well, I’m as serious as the Tea Party.

If you want to look for places to get money to help this country make ends meet; here’s the short list.

  • Wall Street
  • Banking
  • Oil & Gas Industry
  • Defense

Seems like these are the areas which have taken far more than they have put in for the past several years…


And honestly, no, this isn’t the way I’d try and balance the budget.

I’d look at fixing what’s broken…

Health Care — the Obama health care plan is a waste; let’s move to a single payer system (much like our neighbors to the North) that _all_ US citizens are a part of; and that government employees and elected officials have no option but to use (and have no special access).  Of course any business or individual could elect to pay for private insurance, but that would be using after tax dollars.  Medicare and medicaid would simply be a part of the national health system; and the only difference would be that very low income individuals would get at least some number of co-pay waivers per year.

Social Security — definitely needs to be looked into, but a program that many Americans over 50 have been expecting to be there when they retire cannot continue to change…  I’m not sure how to fix this, but we probably need to view all the different parts of the Social Security system separately and deal with solutions based on the needs of each.

Defense — definitely needs to be trimmed.  We simply cannot spend 20% of every tax dollar for defense (40% of what the world spends on arms — six times that of China)… and that money doesn’t need to be wasted on weapons programs that aren’t needed (or wanted by most Americans).  Let’s keep it in perspective, military spending is what caused the implosion of the Soviet Union, the US need not continue to escalate the arms race.

Taxes — there’s a simple solution, throw out the old tax code (and the IRS) and institute a simple code.  Something like: no tax on earnings to poverty level,  5% on everything above poverty level to say 2x poverty level; add 5% percent on each 1x poverty level beyond that to a maximum rate of 50%.  That’s it, no other Federal tax (everything comes out of one tax stream).  No American entity pays 50% of their earnings in tax; and very few pay anywhere near that.  If the tax rate is too high, just adjust the single 5% number on each band, and instantly the earnings amount the cap applies to goes up.  Plus, as poverty is eliminated, the tax bracket broadens.

Term Limits — any elected official needs to be bound by the same term limits as the President; no more than two terms in the same office.  And we need to make sure that these officials are paid the US median salary — after all, they should represent the views of an average American, and that they have the exact same safety net as the rest of America (Social Security)… no special retirement plan.  Now I would certainly agree that they could be considered government employees, and count their time in office toward a retirement — the same as the clerks in their offices do.

Education — we definitely need to consider education as a national issue, not a local one.  Standards need to be more consistent and graduates need to be functional in our society (if you don’t think education is closely tied to economics, you’re living in a cave).


None of this is what’s being talked about — the Tea Party is completely politically motivated, and are only interested in imposing their regressive (misguided) Christian ultra-right views on the process; and don’t want to work towards any real solution since they view failure as the way to gain control.

The first step to fixing the problem is change — and I subscribe that change starts by sending the signal that we as Americans just won’t put up with the way in which business has been done too long.

Perhaps the American Spring isn’t far off.

Originally posted 2011-09-26 02:00:49.

Volcker’s views being echoed by Obama

Paul Volcker for years has been adamant that banks should not be allowed to use federally insured money to gamble on the market.

Hard to deny that we need to make changes in the way Wall Street and Big Banking does business; remember, we’ve done nothing but bail them out and allow them to make record profits using tax payer money.

I personally believe the right solution is to tax big banking and to make it more profitable for them to break up into smaller (more easily regulated) business units.  This would also make small banks and credit unions much more capable of competing as well as prevent an economic collapse when one or two banks make bad investment decisions.

Originally posted 2010-01-27 01:00:33.

Spending chill…

Obama may propose a discretionary spending freeze for three years.

Hopefully he’ll fully define what discretionary means; I remember the budget surplus (you know, “extra” money when the country had a trillion dollar debt) so I don’t make any assumptions what politicians in Washington mean by any term that they don’t have a clear track record using.

Of course, he’s already exempted the departments of Defense, Homeland Security, and Veterans Affairs (sound like he’s playing to the political right) from the freezes.

I think it’s great to implement “new” ideas to reign in government spending — of course I’d like to see some the “old” ideas (you know — those campaign promises Obama made that got him elected) implemented.

In the back of my mind I see this a yet another failure looming for the Obama presidency.

Originally posted 2010-01-25 20:00:46.

Tax on the super rich.

There is a good read in The Fiscal Times, an article by Bruce Bartlett that looks at the argument over Warren Buffet’s statement about raising taxes on the super rich.

It’s a one-dimensional argument; but it does bring into question the pillar of the argument has been used to support lowering the tax rate on the super rich.

One thing I will note before sending you off to read this — it’s not the tax rate so much we should be thinking of, but the effective tax rate.  When large corporations and wealthy individuals pay their taxes they often take advantage of numerous deductions that ordinary people cannot (so called loop-holes)… so their effective tax rate ends up being near zero.

I personally think that a tiered flat tax (with no deductions/exemptions), or a value added tax (assessed at each point a good or service is transferred) are the better solutions to creating a tax system that is far less expensive to implement/enforce, and much fairer overall to everyone.

If the current system is kept, not only do the tax brackets need to be changed (as well as the way they work), but the entire tax code needs to be overhauled to remove the loop-holes (and simplify it).

Buffet May Be Right, but the Top Tax Rate is Wrong by Bruce Bartlett, The Fiscal Times

Originally posted 2011-08-20 02:00:28.

The Nightmare Continues…

With the bailout of Fannie Mae and Freddie Mac continuing to drain tax coffers, the first quarter 2010 reported a substantial increase in home owners who missed at least one mortgage payment.

Below are three articles by The Associated Press (with complete links to NPR).


Mortgage Delinquencies, Foreclosures Break Records
by The Associated Press

The number of homeowners who missed at least one mortgage payment surged to a record in the first quarter of the year, a sign that the foreclosure crisis is far from over.

More than 10 percent of homeowners had missed at least one mortgage payment in the January-March period, the Mortgage Bankers Association said Wednesday. That number was up from 9.5 percent in the fourth quarter of last year and 9.1 percent a year earlier.

Those figures are adjusted for seasonal factors. For example, heating bills and holiday expenses tend to push up mortgage delinquencies near the end of the year. Many of those borrowers become current on their loans again by spring.

Without adjusting for seasonal factors, the delinquency numbers dropped, as they normally do from the winter to spring.

More than 4.6 percent of homeowners were in foreclosure, also a record. But that number, which is not adjusted for seasonal factors, was up only slightly from the end of last year.

Stocks slid Wednesday as investors remain concerned with the European debt crisis. The rising number of mortgages also drew some attention. The Dow Jones industrial average fell more than 160 points in early trading.

Jay Brinkmann, the trade group’s chief economist, said the foreclosure crisis appears to have stabilized. Seasonal adjustments may be exaggerating the change from the previous quarter, he added.

“I don’t see signs now that it’s getting worse, but it’s going to take a while,” he said. “A bad situation that’s not getting worse is still bad.”

The number of American homeowners who have missed at least three months of payments or are in foreclosure has surged to around 4.3 million, Brinkmann estimated.

The Obama administration’s $75 billion foreclosure prevention program has barely dented the problem. More than 299,000 homeowners had received permanent loan modifications as of last month. That’s about 25 percent of the 1.2 million who started the program since its March 2009 launch.

About 277,000 homeowners, or 23 percent of those enrolled, have dropped out during a trial phase that lasts at least three months.

Economic woes, such as unemployment or reduced income, are the main catalysts for foreclosures this year. Initially, lax lending standards were the culprit. But homeowners with good credit who took out conventional, fixed-rate loans are now the fastest growing group of foreclosures.

Those borrowers made up nearly 37 percent of new foreclosures in the first quarter of the year, up from 29 percent a year earlier.

The risky subprime adjustable-rate loans that kicked off the foreclosure crisis are making up a smaller share of new foreclosures. They made up 14 percent of new foreclosures in the January-March period, down from 27 percent a year earlier.


Fannie Mae Seeks $8.4B From U.S. After $13B Loss
by The Associated Press

Fannie Mae has again asked taxpayers for more money after reporting a first-quarter loss of more than $13 billion.

The mortgage finance company, which was rescued by the government in September 2008, said it needs an additional $8.4 billion from the government to help cover mounting losses.

Fannie Mae says it lost $13.1 billion, or $2.29 per share, in the January-March period. That takes into account $1.5 billion in dividends paid to the Treasury Department. It compares with a loss of $23.2 billion, or $4.09 a share, in the year-ago period.

The rescue of Fannie Mae and sister company Freddie Mac is turning out to be one of the most expensive aftereffects of the financial meltdown. The new request for aid will bring Fannie Mae’s total to $83.6 billion. The total bill for the duo will now be nearly $145 billion.

Late last year, the Obama administration pledged to cover unlimited losses through 2012 for Freddie and Fannie, lifting an earlier cap of $400 billion.

Fannie and Freddie play a vital role in the mortgage market by purchasing mortgages from lenders and selling them to investors. Together the pair own or guarantee almost 31 million home loans worth about $5.5 trillion. That’s about half of all mortgages.

The two companies, however, loosened their lending standards for borrowers during the real estate boom and are reeling from the consequences.

With the housing market still on shaky ground, Obama administration officials say it is still too early to draft any proposals to reform the two companies or the broader housing finance system.

But Republicans argue the sweeping financial overhaul currently before Congress is incomplete without a plan for Fannie and Freddie. They propose transforming Fannie and Freddie into private companies with no government subsidies, or shutting them down completely.

The legislation “touches nearly every corner of the economy,” Alabama Sen. Richard Shelby said in the GOP weekly radio and Internet address over the weekend. “But these major contributors to the crisis are left unscathed,” he added, singling out Fannie Mae and Freddie Mac.


Freddie Mac Seeks $10.6B In Aid After 1Q Loss
by The Associated Press

Freddie Mac is asking for $10.6 billion in additional federal aid after posting a big loss in the first three months of the year. It’s another sign that the taxpayer bill for stabilizing the housing market will keep mounting.

The McLean, Va.-based mortgage finance company has been effectively owned by the government after nearly collapsing in September 2008. The new request will bring the total tab for rescuing Freddie Mac to $61.3 billion.

Freddie Mac said Wednesday it lost $8 billion, or $2.45 a share, in the January-March period. That takes into account $1.3 billion in dividends paid to the Treasury Department. It compares with a loss of $10.4 billion, or $3.18 a share, in the first quarter last year.

The company, however, cautioned that new accounting standards make it difficult to compare the most recent quarter with the year-ago period. In the first quarter of this year, Freddie Mac was forced to bring $1.5 trillion in assets and liabilities onto its balance sheet, causing the company’s net worth to plunge by $11.7 billion.

Nevertheless, the company’s CEO Charles Haldeman said, “We are seeing some signs of stabilization in the housing market, including house prices and sales in some key geographic areas.”

He cautioned, though, that the housing market “remains fragile with historically high delinquency and foreclosure levels, and high unemployment among the key risks.”

Created by Congress, Freddie Mac and sibling company Fannie Mae buy mortgages from lenders and package them into bonds that are resold to global investors. As the housing bubble burst, they were unable to raise enough money to stay afloat, and the government effectively nationalized them.

Freddie’s new request will bring the total taxpayer tab for both companies to about $126 billion.

With the housing market still on shaky ground, Obama administration officials argue that it is still too early to draft any proposals to reform the two companies or the broader housing finance system.

But Republicans argue that the sweeping financial overhaul currently before Congress is incomplete without a plan for Fannie and Freddie. Senate Republicans propose transforming Fannie and Freddie into private companies with no government subsidies, or to shut them down completely.


The deficit was $1.2 – $1.3 trillion when Obama took the reigns; some projections put it to be as high as $10 trillion in 2020… and while I’m not a fan of Obama, much of that was set in motion before he tripped over his own feet.

Originally posted 2010-05-20 02:00:51.

Boeing

I’ve seen a number of initiatives from Boeing that are targeted at trying to get a US DOD contract for supplying tankers to the US Air Force.

I don’t think there’s anything wrong with Boeing as a potential supplier for tankers (though I would like everyone to review why we need to build tankers period); but Boeing seems to be forgetting that with government contracts, it’s the lowest bidder who wins.

Boeing talks about American jobs, know-how, unfair competition from Air Bus (well, Boeing probably thinks any competition is unfair)… but they don’t highlight the fact that they simply aren’t competitive.

Welfare capitalism to large is just another form of socialism — and part of the “trickle down” philosophy (the question is how much get’s skimmed of with huge executive bonuses and how much really does trickle down).

We need to think global; and keep moving forward to creating a global economy and global society rather than trying to make sure the grass in our own yard stays the greenest (of course we can talk about this on a state-by-state basis just as easily as a nation-by-nation basis).

I say, the the low bidder win; and let’s make sure that the defense budget is treated with the same scrutiny and cuts that other budgets are — waste is waste, and “saving” our troops (who were put in danger by a lie by George W) just isn’t a reasonable excuse to keep spending on destruction.

Originally posted 2010-04-29 02:00:45.

All the news fit to print…

Hmm… maybe that should be all the bs that can be gotten away with!

When you read news articles or when people relay to you “facts” be sure and do your homework; read accounts of the same events on multiple un-related sources.  In fact it’s often good to get a perspective from an international source.

Take a look at any of the facts, figures, and claims — try and verify those against an authoritative source.

If the information reported is important to you; check to see if any of the “facts” it’s based on, or claims it makes are updated over time.

Most journalists report the news impartially from their perspective; but it is from their perspective.  Many journalists and news organization like to sensationalize the news or majorly spin it to suit their agenda.

Question everything.

Originally posted 2009-02-12 01:00:46.

The Eve…

It is the eve of a new year.

It would be interesting to know who future historians will characterize the first decade of this millennium; and what they will have to say about the causes of our plights.

Today; however, we don’t have the advantage of hind sight on today — nor can we really have good perspective on the recent events that have gotten us to where we are.

Each generation looks to it’s time as a decay of what was, and longs for the “good ol’ days”… and for us it’s hard to imagine that these will be the “good ol’ days” of another generation — and much as we lament about today with dwell on fond remembrances of our past so will our children’s children.

Well, that is if the light at the end of the tunnel isn’t an on coming train.

Originally posted 2009-12-31 01:00:25.

Black Friday

It’s Black Friday… though I suspect with this economy most retailers will continue to see red rather than black on the balance sheets this year…

Oh, and just because the retails “report” good numbers – keep watch for the “revisions” for the sales numbers that are likely to follow.

Reality sucks almost as much as the economy.

Black Friday on Wikipedia

Originally posted 2010-11-26 02:00:58.