Recovery Summer IV Results

Economy: After his embarrassing failure on the foreign policy front, President Obama decided to tout his success managing the U.S. economy — just as the historically weak recovery shows fresh signs of weakening further.

In a speech marking the fifth anniversary of the Lehman Bros. collapse, Obama ticked off a laundry list of alleged accomplishments since taking office: I stopped another Great Depression, saved the auto industry, put people to work, etc.

“We cleared away the rubble from the financial crisis,” he said, “and we’ve begun to lay a new foundation for economic growth and prosperity.”

Unfortunately, it’s a foundation built on quicksand.

Just last week we learned that retail sales have softened, consumer sentiment hit a five-month low, job growth in August was still tepid and the number of job losers posted its biggest jump since 2010.

All are signs the economy isn’t going to live up to expectations in the final months of the year.

This comes after 50 months of sluggish growth that has left 4.3 million out of work long-term, helped drive 10 million out of the job market, pushed the labor participation rate to 35-year lows, boosted food stamp rolls by 14 million and pushed nearly 3 million into poverty.

Just 13 states have employment rates above their pre-recession peaks (all but four of them, by the way, voted against Obama in 2008).

Thanks to Obama’s sluggish growth, real median household income remains 4.4% below where it was when his “recovery” started.

The day Obama gave his remarks, the AP reported that the unemployment rate among low-income families is at Great Depression levels of 21%, but among upper-income households it’s 3.2%. That, AP’s analysis found, is the widest gap on record.

AP also found that middle-income workers are increasingly ending up with lower-wage jobs, forcing lower-skilled workers out of the job market.

Meanwhile, a survey out of the University of Chicago finds that a record 8.4% of Americans consider themselves “lower class.”

Here’s another way to look at it: Had Obama’s recovery merely been average, there would be 7.4 million more people gainfully employed today, and the economy would be $1.3 trillion bigger.

Even the left is noticing that, despite Obama’s endless blather about building prosperity from the ground up, his recovery has had the opposite effect — concentrating whatever gains there have been at the top.

The Huffington Post called it “the most uneven recovery in at least several decades” — which would include the Reagan, Clinton and Bush recoveries.

Among the evidence presented: Workers in the bottom 20% have seen their real average hourly wages decline steadily under Obama, compared with gains at the very top. And while 60% of the jobs lost in the recession paid mid-wages, only 22% of the jobs gained in Obama’s recovery did so.

Incredibly, amid all this, Obama claims to see “progress across the board.”  Then again, Obama thinks his foreign policy adventures have been a success, too. (IBD)

“Are some of these folks really so beholden to one extreme wing of their party that they’re willing to tank the entire economy just because they can’t get their way on this issue?” Obama said in a speech at the White House. “Are they really willing to hurt people just to score political points?” (Townhall)

WELL, we know HE IS. He’s been doing it for 5 years now! 🙂

Obama conceded the problems. “As any middle class family will tell you or anybody who’s striving to get in the middle class, we are not yet where we need to be,” he said.

And never will be, with Progressives in charge because they depend on making people poor and dependent on them and making rich people less rich and demonic to keep them them there.

“After all the progress that we’ve made over these last four and a half years, the idea of reversing that progress because of an unwillingness to compromise or because of some ideological agenda is the height of irresponsibility,” Obama said.

Which is why he won’t compromise on anything that has been done or will be done. But he’s not ideologically rigid… 🙂

After all, it’s “Congress” (Read: Republicans) Fault!

He’s not partisan. 🙂

Political Cartoons by Gary Varvel

Political Cartoons by Steve Kelley

Political Cartoons by Michael Ramirez

 

 

The Light

Once again, the President likes to blame everyone else for the lack of success he has seen when it comes to Obamacare.

“But until then, when we’re getting outspent four to one and people are just uncertain about what all this means for them, we’re going to continue to have some polls like that,” Obama said. “And me just making more speeches explaining it in and of itself won’t do it. The test of this is going to be is it working. And if it works, it will be pretty darn popular.”

Even with a new PR blitz (costing $700 Million Dollars), the President can’t win over the public opinion:

“Over the course of six months to a year, as people sign up, and it works, and lo and behold, the people who already have health insurance are not being impacted at all other than the fact that their insurance is more secure and they are getting free preventive care, and all the nightmare scenarios and the train wrecks and the ‘sky is falling’ predictions that come from the other side do not happen, then health care will become more popular,” Obama said.

And when the train does wreck, naturally, it will be someone elses fault! 🙂

The New “Cash for Clunkers”…

Way back in 2009, President Obama’s Treasury Department launched the Home Affordable Modification Program, a massive authorization to help homeowners struggling with their mortgages in the wake of the financial crisis. 1.2 milllion people participated in the program at a cost to taxpayers of $4.4 billion.

A report [pdf] dropped this week from the Office of the Special Inspector General for TARP (SIGTARP) that HAMP has a stunning failure rate. Of the 1.2 million HAMP participants, 306,000 have re-defaulted on their mortgages, at an additional cost to taxpayers of $815 million. What’s more, another 88,000 homeowners in the HAMP program have missed payments and are at risk to re-default.

Twenty-two percent of homeowners who have re-defaulted on their HAMP permanent mortgage modifications have moved into the foreclosure process. The Administration’s stated goal for the housing initiative was “to help as many as three to four million financially struggling homeowners avoid foreclosure by modifying loans to a level that is affordable for borrowers now and sustainable over the long term.” However, since 2009, during each year of the program, an increased number of homeowners redefaulted on HAMP permanent mortgage modifications. Redefault rates of the oldest 2009 HAMP permanent mortgage modifications have continued to increase as they age at a redefault rate of 46%. The 2010 HAMP permanent mortgage modifications are redefaulting at a rate of 38%. Treasury’s data continue to demonstrate that the longer homeowners remain in HAMP, the greater the chance that they will redefault on their permanent modification and fall out of the TARP program. For the substantial number of homeowners who redefault, their modification was not sustainable. It is crucial that Treasury recognize this problem and take proactive steps to ensure that HAMP lives up to its promise and potential.

HAMP has been re-authorized to be in effect through 2015. (Townhall)

Gee, that mean through the mid-term election and that a lot of people who were going to default before because they couldn’t afford it have defaulted again. NO! that’s shocking… :

But at least it’s safe until after the election. Just like the employer mandate. Fancy that…

Detroit

As Detroit enters the federal bankruptcy process, the city is proposing a controversial plan for paring some of the $5.7 billion it owes in retiree health costs: pushing many of those too young to qualify for Medicare out of city-run coverage and into the new insurance markets that will soon be operating under the Obama health care law.

Detroit wants insurance exchanges to cover retirees like Thomas Berry, a former police officer.

“There’s fear and panic,” said Michael Underwood, an ailing Chicago Police Department retiree.
Readers’ Comments

Officials say the plan would be part of a broader effort to save Detroit tens of millions of dollars in health costs each year, a major element in a restructuring package that must be approved by a bankruptcy judge. It is being watched closely by municipal leaders around the nation, many of whom complain of mounting, unsustainable prices for the health care promised to retired city workers.

Just dump all those poor bastards on the rest of us. It will save the city and make ObamaCare costs skyrocket and of course, more popular….

Say, isn’t that sort of a Bailout?? 🙂

The light at the end of this tunnel is a bullet train!

 

Moral Hazard

Ineptocracy (in-ep-toc-ra-cy)- a system of government where the least capable to lead are elected by the least capable of producing,and where the members of society least likely to sustain themselves or succeed,are rewarded with goods and services paid for by the confiscated wealth of a diminishing number of producers.

THE $7 Trillion Dollar Secret

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.
‘Change Their Votes’

“When you see the dollars the banks got, it’s hard to make the case these were successful institutions,” says Sherrod Brown, a Democratic Senator from Ohio who in 2010 introduced an unsuccessful bill to limit bank size. “This is an issue that can unite the Tea Party and Occupy Wall Street. There are lawmakers in both parties who would change their votes now.”

The size of the bailout came to light after Bloomberg LP, the parent of Bloomberg News, won a court case against the Fed and a group of the biggest U.S. banks called Clearing House Association LLC to force lending details into the open.

The Fed, headed by Chairman Ben S. Bernanke, argued that revealing borrower details would create a stigma — investors and counterparties would shun firms that used the central bank as lender of last resort — and that needy institutions would be reluctant to borrow in the next crisis. Clearing House Association fought Bloomberg’s lawsuit up to the U.S. Supreme Court, which declined to hear the banks’ appeal in March 2011.

$7.77 Trillion

The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

“TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing.”

Bankers didn’t disclose the extent of their borrowing. On Nov. 26, 2008, then-Bank of America (BAC) Corp. Chief Executive Officer Kenneth D. Lewis wrote to shareholders that he headed “one of the strongest and most stable major banks in the world.” He didn’t say that his Charlotte, North Carolina-based firm owed the central bank $86 billion that day.
‘Motivate Others’

JPMorgan Chase & Co. CEO Jamie Dimon told shareholders in a March 26, 2010, letter that his bank used the Fed’s Term Auction Facility “at the request of the Federal Reserve to help motivate others to use the system.” He didn’t say that the New York-based bank’s total TAF borrowings were almost twice its cash holdings or that its peak borrowing of $48 billion on Feb. 26, 2009, came more than a year after the program’s creation.

Howard Opinsky, a spokesman for JPMorgan (JPM), declined to comment about Dimon’s statement or the company’s Fed borrowings. Jerry Dubrowski, a spokesman for Bank of America, also declined to comment.

The Fed has been lending money to banks through its so- called discount window since just after its founding in 1913. Starting in August 2007, when confidence in banks began to wane, it created a variety of ways to bolster the financial system with cash or easily traded securities. By the end of 2008, the central bank had established or expanded 11 lending facilities catering to banks, securities firms and corporations that couldn’t get short-term loans from their usual sources.
‘Core Function’

“Supporting financial-market stability in times of extreme market stress is a core function of central banks,” says William B. English, director of the Fed’s Division of Monetary Affairs. “Our lending programs served to prevent a collapse of the financial system and to keep credit flowing to American families and businesses.”

The Fed has said that all loans were backed by appropriate collateral. That the central bank didn’t lose money should “lead to praise of the Fed, that they took this extraordinary step and they got it right,” says Phillip Swagel, a former assistant Treasury secretary under Henry M. Paulson and now a professor of international economic policy at the University of Maryland.

The Fed initially released lending data in aggregate form only. Information on which banks borrowed, when, how much and at what interest rate was kept from public view.

The secrecy extended even to members of President George W. Bush’s administration who managed TARP. Top aides to Paulson weren’t privy to Fed lending details during the creation of the program that provided crisis funding to more than 700 banks, say two former senior Treasury officials who requested anonymity because they weren’t authorized to speak.
Big Six

The Treasury Department relied on the recommendations of the Fed to decide which banks were healthy enough to get TARP money and how much, the former officials say. The six biggest U.S. banks, which received $160 billion of TARP funds, borrowed as much as $460 billion from the Fed, measured by peak daily debt calculated by Bloomberg using data obtained from the central bank. Paulson didn’t respond to a request for comment.

The six — JPMorgan, Bank of America, Citigroup Inc. (C), Wells Fargo & Co. (WFC), Goldman Sachs Group Inc. (GS) and Morgan Stanley — accounted for 63 percent of the average daily debt to the Fed by all publicly traded U.S. banks, money managers and investment- services firms, the data show. By comparison, they had about half of the industry’s assets before the bailout, which lasted from August 2007 through April 2010. The daily debt figure excludes cash that banks passed along to money-market funds.
Bank Supervision

While the emergency response prevented financial collapse, the Fed shouldn’t have allowed conditions to get to that point, says Joshua Rosner, a banking analyst with Graham Fisher & Co. in New York who predicted problems from lax mortgage underwriting as far back as 2001. The Fed, the primary supervisor for large financial companies, should have been more vigilant as the housing bubble formed, and the scale of its lending shows the “supervision of the banks prior to the crisis was far worse than we had imagined,” Rosner says.

Bernanke in an April 2009 speech said that the Fed provided emergency loans only to “sound institutions,” even though its internal assessments described at least one of the biggest borrowers, Citigroup, as “marginal.”

On Jan. 14, 2009, six days before the company’s central bank loans peaked, the New York Fed gave CEO Vikram Pandit a report declaring Citigroup’s financial strength to be “superficial,” bolstered largely by its $45 billion of Treasury funds. The document was released in early 2011 by the Financial Crisis Inquiry Commission, a panel empowered by Congress to probe the causes of the crisis.
‘Need Transparency’

Andrea Priest, a spokeswoman for the New York Fed, declined to comment, as did Jon Diat, a spokesman for Citigroup.

“I believe that the Fed should have independence in conducting highly technical monetary policy, but when they are putting taxpayer resources at risk, we need transparency and accountability,” says Alabama Senator Richard Shelby, the top Republican on the Senate Banking Committee.

Judd Gregg, a former New Hampshire senator who was a lead Republican negotiator on TARP, and Barney Frank, a Massachusetts Democrat who chaired the House Financial Services Committee, both say they were kept in the dark.

“We didn’t know the specifics,” says Gregg, who’s now an adviser to Goldman Sachs.

“We were aware emergency efforts were going on,” Frank says. “We didn’t know the specifics.”
Disclose Lending

Frank co-sponsored the Dodd-Frank Wall Street Reform and Consumer Protection Act, billed as a fix for financial-industry excesses. Congress debated that legislation in 2010 without a full understanding of how deeply the banks had depended on the Fed for survival.

It would have been “totally appropriate” to disclose the lending data by mid-2009, says David Jones, a former economist at the Federal Reserve Bank of New York who has written four books about the central bank.

“The Fed is the second-most-important appointed body in the U.S., next to the Supreme Court, and we’re dealing with a democracy,” Jones says. “Our representatives in Congress deserve to have this kind of information so they can oversee the Fed.”

The Dodd-Frank law required the Fed to release details of some emergency-lending programs in December 2010. It also mandated disclosure of discount-window borrowers after a two- year lag.
Protecting TARP

TARP and the Fed lending programs went “hand in hand,” says Sherrill Shaffer, a banking professor at the University of Wyoming in Laramie and a former chief economist at the New York Fed. While the TARP money helped insulate the central bank from losses, the Fed’s willingness to supply seemingly unlimited financing to the banks assured they wouldn’t collapse, protecting the Treasury’s TARP investments, he says.

“Even though the Treasury was in the headlines, the Fed was really behind the scenes engineering it,” Shaffer says.

Congress, at the urging of Bernanke and Paulson, created TARP in October 2008 after the bankruptcy of Lehman Brothers Holdings Inc. made it difficult for financial institutions to get loans. Bank of America and New York-based Citigroup each received $45 billion from TARP. At the time, both were tapping the Fed. Citigroup hit its peak borrowing of $99.5 billion in January 2009, while Bank of America topped out in February 2009 at $91.4 billion.
No Clue

Lawmakers knew none of this.

They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one-tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible.

Mark Lake, a spokesman for Morgan Stanley, declined to comment, as did spokesmen for Citigroup and Goldman Sachs.

Had lawmakers known, it “could have changed the whole approach to reform legislation,” says Ted Kaufman, a former Democratic Senator from Delaware who, with Brown, introduced the bill to limit bank size.
Moral Hazard

Kaufman says some banks are so big that their failure could trigger a chain reaction in the financial system. The cost of borrowing for so-called too-big-to-fail banks is lower than that of smaller firms because lenders believe the government won’t let them go under. The perceived safety net creates what economists call moral hazard — the belief that bankers will take greater risks because they’ll enjoy any profits while shifting losses to taxpayers.

Moral hazard arises because an individual or institution does not take the full consequences and responsibilities of its actions, and therefore has a tendency to act less carefully than it otherwise would, leaving another party to hold some responsibility for the consequences of those actions. For example, a person with insurance against automobile theft may be less cautious about locking his or her car, because the negative consequences of vehicle theft are (partially) the responsibility of the insurance company.

If Congress had been aware of the extent of the Fed rescue, Kaufman says, he would have been able to line up more support for breaking up the biggest banks.

Byron L. Dorgan, a former Democratic senator from North Dakota, says the knowledge might have helped pass legislation to reinstate the Glass-Steagall Act, which for most of the last century separated customer deposits from the riskier practices of investment banking.

“Had people known about the hundreds of billions in loans to the biggest financial institutions, they would have demanded Congress take much more courageous actions to stop the practices that caused this near financial collapse,” says Dorgan, who retired in January.
Getting Bigger

Instead, the Fed and its secret financing helped America’s biggest financial firms get bigger and go on to pay employees as much as they did at the height of the housing bubble.

Total assets held by the six biggest U.S. banks increased 39 percent to $9.5 trillion on Sept. 30, 2011, from $6.8 trillion on the same day in 2006, according to Fed data.

For so few banks to hold so many assets is “un-American,” says Richard W. Fisher, president of the Federal Reserve Bank of Dallas. “All of these gargantuan institutions are too big to regulate. I’m in favor of breaking them up and slimming them down.”

Employees at the six biggest banks made twice the average for all U.S. workers in 2010, based on Bureau of Labor Statistics hourly compensation cost data. The banks spent $146.3 billion on compensation in 2010, or an average of $126,342 per worker, according to data compiled by Bloomberg. That’s up almost 20 percent from five years earlier compared with less than 15 percent for the average worker. Average pay at the banks in 2010 was about the same as in 2007, before the bailouts.
‘Wanted to Pretend’

“The pay levels came back so fast at some of these firms that it appeared they really wanted to pretend they hadn’t been bailed out,” says Anil Kashyap, a former Fed economist who’s now a professor of economics at the University of Chicago Booth School of Business. “They shouldn’t be surprised that a lot of people find some of the stuff that happened totally outrageous.”

Bank of America took over Merrill Lynch & Co. at the urging of then-Treasury Secretary Paulson after buying the biggest U.S. home lender, Countrywide Financial Corp. When the Merrill Lynch purchase was announced on Sept. 15, 2008, Bank of America had $14.4 billion in emergency Fed loans and Merrill Lynch had $8.1 billion. By the end of the month, Bank of America’s loans had reached $25 billion and Merrill Lynch’s had exceeded $60 billion, helping both firms keep the deal on track.
Prevent Collapse

Wells Fargo bought Wachovia Corp., the fourth-largest U.S. bank by deposits before the 2008 acquisition. Because depositors were pulling their money from Wachovia, the Fed channeled $50 billion in secret loans to the Charlotte, North Carolina-based bank through two emergency-financing programs to prevent collapse before Wells Fargo could complete the purchase.

“These programs proved to be very successful at providing financial markets the additional liquidity and confidence they needed at a time of unprecedented uncertainty,” says Ancel Martinez, a spokesman for Wells Fargo.

JPMorgan absorbed the country’s largest savings and loan, Seattle-based Washington Mutual Inc., and investment bank Bear Stearns Cos. The New York Fed, then headed by Timothy F. Geithner, who’s now Treasury secretary, helped JPMorgan complete the Bear Stearns deal by providing $29 billion of financing, which was disclosed at the time. The Fed also supplied Bear Stearns with $30 billion of secret loans to keep the company from failing before the acquisition closed, central bank data show. The loans were made through a program set up to provide emergency funding to brokerage firms.
‘Regulatory Discretion’

“Some might claim that the Fed was picking winners and losers, but what the Fed was doing was exercising its professional regulatory discretion,” says John Dearie, a former speechwriter at the New York Fed who’s now executive vice president for policy at the Financial Services Forum, a Washington-based group consisting of the CEOs of 20 of the world’s biggest financial firms. “The Fed clearly felt it had what it needed within the requirements of the law to continue to lend to Bear and Wachovia.”

The bill introduced by Brown and Kaufman in April 2010 would have mandated shrinking the six largest firms.

“When a few banks have advantages, the little guys get squeezed,” Brown says. “That, to me, is not what capitalism should be.”

Kaufman says he’s passionate about curbing too-big-to-fail banks because he fears another crisis.

‘Can We Survive?’

“The amount of pain that people, through no fault of their own, had to endure — and the prospect of putting them through it again — is appalling,” Kaufman says. “The public has no more appetite for bailouts. What would happen tomorrow if one of these big banks got in trouble? Can we survive that?”

Lobbying expenditures by the six banks that would have been affected by the legislation rose to $29.4 million in 2010 compared with $22.1 million in 2006, the last full year before credit markets seized up — a gain of 33 percent, according to OpenSecrets.org, a research group that tracks money in U.S. politics. Lobbying by the American Bankers Association, a trade organization, increased at about the same rate, OpenSecrets.org reported.

Lobbyists argued the virtues of bigger banks. They’re more stable, better able to serve large companies and more competitive internationally, and breaking them up would cost jobs and cause “long-term damage to the U.S. economy,” according to a Nov. 13, 2009, letter to members of Congress from the FSF.

The group’s website cites Nobel Prize-winning economist Oliver E. Williamson, a professor emeritus at the University of California, Berkeley, for demonstrating the greater efficiency of large companies.
‘Serious Burden’

In an interview, Williamson says that the organization took his research out of context and that efficiency is only one factor in deciding whether to preserve too-big-to-fail banks.

“The banks that were too big got even bigger, and the problems that we had to begin with are magnified in the process,” Williamson says. “The big banks have incentives to take risks they wouldn’t take if they didn’t have government support. It’s a serious burden on the rest of the economy.”

The Moral Hazard.

Dearie says his group didn’t mean to imply that Williamson endorsed big banks.

Top officials in President Barack Obama’s administration sided with the FSF in arguing against legislative curbs on the size of banks.
Geithner, Kaufman

On May 4, 2010, Geithner visited Kaufman in his Capitol Hill office. As president of the New York Fed in 2007 and 2008, Geithner helped design and run the central bank’s lending programs. The New York Fed supervised four of the six biggest U.S. banks and, during the credit crunch, put together a daily confidential report on Wall Street’s financial condition. Geithner was copied on these reports, based on a sampling of e- mails released by the Financial Crisis Inquiry Commission.

At the meeting with Kaufman, Geithner argued that the issue of limiting bank size was too complex for Congress and that people who know the markets should handle these decisions, Kaufman says. According to Kaufman, Geithner said he preferred that bank supervisors from around the world, meeting in Basel, Switzerland, make rules increasing the amount of money banks need to hold in reserve. Passing laws in the U.S. would undercut his efforts in Basel, Geithner said, according to Kaufman.

Anthony Coley, a spokesman for Geithner, declined to comment.
‘Punishing Success’

Lobbyists for the big banks made the winning case that forcing them to break up was “punishing success,” Brown says. Now that they can see how much the banks were borrowing from the Fed, senators might think differently, he says.

The Fed supported curbing too-big-to-fail banks, including giving regulators the power to close large financial firms and implementing tougher supervision for big banks, says Fed General Counsel Scott G. Alvarez. The Fed didn’t take a position on whether large banks should be dismantled before they get into trouble.

Dodd-Frank does provide a mechanism for regulators to break up the biggest banks. It established the Financial Stability Oversight Council that could order teetering banks to shut down in an orderly way. The council is headed by Geithner.

“Dodd-Frank does not solve the problem of too big to fail,” says Shelby, the Alabama Republican. “Moral hazard and taxpayer exposure still very much exist.”
Below Market

Dean Baker, co-director of the Center for Economic and Policy Research in Washington, says banks “were either in bad shape or taking advantage of the Fed giving them a good deal. The former contradicts their public statements. The latter — getting loans at below-market rates during a financial crisis — is quite a gift.”

The Fed says it typically makes emergency loans more expensive than those available in the marketplace to discourage banks from abusing the privilege. During the crisis, Fed loans were among the cheapest around, with funding available for as low as 0.01 percent in December 2008, according to data from the central bank and money-market rates tracked by Bloomberg.

The Fed funds also benefited firms by allowing them to avoid selling assets to pay investors and depositors who pulled their money. So the assets stayed on the banks’ books, earning interest.

Banks report the difference between what they earn on loans and investments and their borrowing expenses. The figure, known as net interest margin, provides a clue to how much profit the firms turned on their Fed loans, the costs of which were included in those expenses. To calculate how much banks stood to make, Bloomberg multiplied their tax-adjusted net interest margins by their average Fed debt during reporting periods in which they took emergency loans.
Added Income

The 190 firms for which data were available would have produced income of $13 billion, assuming all of the bailout funds were invested at the margins reported, the data show.

The six biggest U.S. banks’ share of the estimated subsidy was $4.8 billion, or 23 percent of their combined net income during the time they were borrowing from the Fed. Citigroup would have taken in the most, with $1.8 billion.

“The net interest margin is an effective way of getting at the benefits that these large banks received from the Fed,” says Gerald A. Hanweck, a former Fed economist who’s now a finance professor at George Mason University in Fairfax, Virginia.

While the method isn’t perfect, it’s impossible to state the banks’ exact profits or savings from their Fed loans because the numbers aren’t disclosed and there isn’t enough publicly available data to figure it out.

Opinsky, the JPMorgan spokesman, says he doesn’t think the calculation is fair because “in all likelihood, such funds were likely invested in very short-term investments,” which typically bring lower returns.
Standing Access

Even without tapping the Fed, the banks get a subsidy by having standing access to the central bank’s money, says Viral Acharya, a New York University economics professor who has worked as an academic adviser to the New York Fed.

“Banks don’t give lines of credit to corporations for free,” he says. “Why should all these government guarantees and liquidity facilities be for free?”

In the September 2008 meeting at which Paulson and Bernanke briefed lawmakers on the need for TARP, Bernanke said that if nothing was done, “unemployment would rise — to 8 or 9 percent from the prevailing 6.1 percent,” Paulson wrote in “On the Brink” (Business Plus, 2010).
Occupy Wall Street

The U.S. jobless rate hasn’t dipped below 8.8 percent since March 2009, 3.6 million homes have been foreclosed since August 2007, according to data provider RealtyTrac Inc., and police have clashed with Occupy Wall Street protesters, who say government policies favor the wealthiest citizens, in New York, Boston, Seattle and Oakland, California.

The Tea Party, which supports a more limited role for government, has its roots in anger over the Wall Street bailouts, says Neil M. Barofsky, former TARP special inspector general and a Bloomberg Television contributing editor.

“The lack of transparency is not just frustrating; it really blocked accountability,” Barofsky says. “When people don’t know the details, they fill in the blanks. They believe in conspiracies.”

In the end, Geithner had his way. The Brown-Kaufman proposal to limit the size of banks was defeated, 60 to 31. Bank supervisors meeting in Switzerland did mandate minimum reserves that institutions will have to hold, with higher levels for the world’s largest banks, including the six biggest in the U.S. Those rules can be changed by individual countries.

They take full effect in 2019.

Meanwhile, Kaufman says, “we’re absolutely, totally, 100 percent not prepared for another financial crisis.”(Bloomberg)

Feel better now? 🙂

Political Cartoons by Henry Payne

Political Cartoons by Jerry Holbert

 Political Cartoons by Michael Ramirez

The Ruling Elite Exposed

One of the biggest scandals in American politics is waiting to explode: the full story of the inside game in Washington shows how the permanent political class enriches itself at the expense of the rest of us. Insider trading is illegal on Wall Street, yet it is routine among members of Congress. Normal individuals cannot get in on IPOs at the asking price, but politicians do so routinely. The Obama administration has been able to funnel hundreds of millions of dollars to its supporters, ensuring yet more campaign donations. An entire class of investors now makes all of its profits based on influence and access in Washington. Peter Schweizer has doggedly researched through mountains of financial records, tracking complicated deals and stock trades back to the timing of briefings, votes on bills, and every other point of leverage for politicians in Washington. The result is a manifesto for revolution: the Permanent Political Class must go.
For the Palin Deranged, let it be known he has worked for her and shares her ideas so you may want to consult your Thought Police Manual before continuing…Thank you.
Political Cartoons by Lisa Benson
The Point is not that it’s the Democrats or The Republicans doing it, it’s both!
The fact is NEITHER of them should be doing it is the point!
Martha Stewart went to Jail for “insider trading”.
Congress does it as matter of course. It’s a normal part of the day. Nothing special.
Perfectly Legal. They wrote the laws that say so! 🙂
They get opportunities that would send us normal people to jail, they can do it with abandon.
It turns out that it is not illegal for member of Congress to make stock trades using inside information they learn while working on legislation.
So they can use, say, the passing of Health Care Laws to buy and selling stocks that would be effected by it to enrich themselves.
Or an earmark for a major road to be built conveniently near property you just bought.
They could get out of the Stock Market before it crashed in 2008.
You could buy IPOs not available to normal people (Nancy Pelosi).
Conflict of Interest is not illegal for Congress. Everyone else, yes, Congress, No.
Political Intelligence groups data mine and gather the non-public info in Congress and sell it to Wall Street so they can all make money.
Yes, that evil Wall Street that is so “evil” and so is the subject of so much hypocritical demonizing.
Thus you may surmise that a political opposition to Big Brother Obama was psychologically necessary in order to provide an internal enemy posing a threat to the rule of the Party; the constantly reiterated ritual of the Two Minutes Hate help ensure that popular support for and devotion towards Big Brother is continuous.
So it’s Orwell’s  Hate Week is an event in George Orwell’s novel Nineteen Eighty-Four, designed to increase the hatred for the current enemy of the Party, as much as possible but now they have 24/7/365 newscasts and cable channels along with newspapers to keep it going ad infinitum!
But again, it’s Both Republicans and Democrats.
The Democrats tell the masses to hate Wall Street, but they are using Wall Street to get rich.
Rich people are evil.
Then they use info that would be a normal person a prison sentence to get rich.
They are the Political and Economic Elite.
They are in fact, the very thing they are saying is evil and that the class warfare is supposed to be about but they have re-directed it.
Class Warfare is a fraud. It’s a Diversion. It’s an Orwellian Hate ploy.
Fascinating. Disgusting. And perfectly Legal, for them.
One set of rules for the Ruling Elite. One set of rules for the peasants.
Is that Democracy?
No.
This is both Republicans and Democrats!
By the way: Mr. Warren “tax me more” ‘Darling of the Left’ Buffet is one of the major influences. Aw shucks…
One of the most damaging things reported by Schweizer is how Warren Buffett profited with millions from the government bailout programs he helped design. Wynton Hall, writing in Big Government says: In the wake of the $700 billion TARP bailout, Warren Buffett apparently shaped a plan to clean up toxic assets that Treasury Secretary Tim Geithner later adopted–resulting in massive profits for Buffett.
Buffett proposed something he called a “public-private partnership fund.” For every $10 billion the private sector invested, Buffett said the government should put up $40 billion.
As the political debates surrounding the proposed $700 billion TARP bailout bill heated up, Buffett maintained an appearance of naivete, an “aw shucks” shtick that deferred to the judgment of politicians.  “I’m not brave enough to try to influence the Congress,” Buffett told the New York Times.
During the meeting, Buffett strongly urged Democratic members to pass the $700 billion TARP bill to avert what he warned would otherwise be “the biggest financial meltdown in American history.”
That soundbite sound familiar? 🙂
After Paulson’s exit, incoming Treasury Secretary Tim Geithner tweaked the plan and rolled it out in March 2009. But according to quarterly reports from Buffett’s holdings company, Berkshire Hathaway, between the time the billionaire crafted his plan and Geithner adopted it, Buffett quietly purchased 12.4 million shares of Wells Fargo stock and 1.5 million shares of U.S. Bancorp. Once the government unveiled its “Public-Private Investment Program,” bank stocks jumped, resulting in large profits for Buffett.
In September of 2008, Buffett invested $5 billion in the over-leveraged investment house of Goldman Sachs, having obtained impressive terms: Berkshire Hathaway would receive preferred stock with a 10% dividend yield, and the option to buy another $5 billion at $115 a share.
Buffett had a strong financial interest in the bailout’s passage, says Schweizer. “If the bailout went through, it would be a windfall for Goldman. If it failed, it would be disastrous for Berkshire Hathaway.”

Yet Buffett had little reason to worry; his insider political connections afforded him two guarantees. First, many members of Congress were themselves investing heavily in Berkshire Hathaway throughout the bailout talks–a move that may simply have been a good investment in an unsteady time, or else a shrewd exploitation of unique information. Senator Dick Durbin (D-IL), for example, snatched up $130,000 worth of Berkshire Hathaway stock.  Senator Orrin Hatch (R-UT) also bought shares in Berkshire Hathaway, as did Senator Claire McCaskill (D-MO), who purchased half a million dollars’ worth just days after the Wall Street bailout bill was signed.  Second, Buffett knew he had an ally in the surging Barack Obama. Buffett had backed Obama in 2008. And as Obama has himself conceded, “Warren Buffett is one of those people that I listen to.”

When the TARP bailout passed, Berkshire Hathaway firms received a staggering $95 billion in bailout cash from U.S. taxpayers. In total, TARP-assisted companies made up almost a third (30%) of Buffett’s entire publicly disclosed stock portfolio. The payoff:  by July 2009, Buffett’s Goldman bet and his congressional jawboning had yielded profits as high as $3.7 billion.

Incredibly, in a breathtaking public relations move, Buffett publicly complained that the government bailouts had put his company at a disadvantage,  because funders “who are using imaginative methods (or lobbying skills) to come under the government’s umbrella–have money costs that are minimal.”  Rolfe Winkler of Reuters best captured Buffet’s audacity: “It takes chutzpah to lobby for bailouts, make trades seeking to profit from them, and then complain that those doing so put you at a disadvantage.”

Still, despite Buffett’s apparent, and brazen, display of crony capitalism and political manipulation to produce billions in profits, Schweizer says that the most egregious part is that his behavior appears to have been entirely legal. Buffett merely leveraged his unique and powerful political connections to turn taxpayer money into massive private profits.

Now, with the 2012 presidential election right around the corner, Buffett plans to back President Obama again. In August 2011, the two men vacationed together in the plush surroundings of Martha’s Vineyard. Shortly thereafter, Buffett hosted an Obama fundraiser in New York City where contributors spent $35,800 for VIP tickets and the chance to discuss the economy with the Berkshire Hathaway CEO.

If Buffett’s political track record is any indication, his time spent alongside President Obama was an investment intended to yield a high rate of return–at taxpayers’ expense. (Big Government.com)

Aw shucks, Tax me More Warren is part of the disease, what a shock. And of Course, Obama has his ‘full support’ $$$$

In January, Obama specifically said, “But at a time when our discourse has become so sharply polarized – at a time when we are far too eager to lay the blame for all that ails the world at the feet of those who think differently than we do – it’s important for us to pause for a moment and make sure that we are talking with each other in a way that heals, not a way that wounds.”

We were told to change our rhetoric, to have a new “tone” of civility free of violent references.

Fast forward to now, and Obama’s Vice President Joe Biden, is telling unions they “fired the first shot” at a campaign events.

“Folks, you fired the first shot. It’s not about Barack Obama. It’s not about Joe Biden. It’s about whether middle-class people are going to be put back in the saddle again – because you are the people who make this country move,” Vice President Joe Biden said at a campaign event in Ohio today.

Thanks for leading by example, Biden.

But then again, The Unions are the Brownshirts, the army of this Adminstration and as has been chronicled in this blog many times, the incestuous $$ partners of Democrats.

So the Circle of Sleeze continues. But don’t worry, it’s <fill in the blank>’s Fault! 🙂

Pay no attention to the men behind the curtain…

Political Cartoons by Michael Ramirez
Political Cartoons by Glenn Foden

Political Cartoons by Chip Bok

 Political Cartoons by Bob Gorrell
Political Cartoons by Gary McCoy

Occupy Hollywood

More Hope & Change: 🙂

Political Cartoons by Bob Gorrell

More hilarity for “99% er” Millionaire Michael Moore. Who seems to want some media attention more than anything else. Any publicity is good publicity.

Too bad he’s gone so Hollywood. Roger & Me is deeply cynical and hilarious. But we come from the same town and the movie was about the same time I was growing up there, so I understood the humor and the sarcasm. Then.

In Denver: Moore, ever the populist $50 millionposeur, did not disappoint. “Everybody is a leader!” he insisted. “Wage slaves! That’s right. You know, historians — I believe that’s what they’re going to call us. They’re going to call us all wage slaves!” (would that apply to the little people who work for a guy who has $50 Million Dollars like he does?)

When Michael Moore told Piers Morgan that he was not among the hated 1 percent, he wasn’t lying. That’s because with a net worth upwards of $50 million he’s among the top 0.1 percent.

This story appears in the Nov. 11 issue of The Hollywood Reporter.

One of the many things that bug me about the industry in which I work is the large population of phonies who claim to be liberal, caring, green and unaffected by their wealth and fame but in reality are just as self-centered and addicted to their huge, over-air-conditioned living spaces and private planes as those at whom they point their fingers. And none is more phony and finger-pointing than Michael Moore.

But it looks good. And in Hollywood, Perception IS reality. And in Democrat Politics Perception is the ONLY reality they want.

Moore seems to be everywhere of late, talking about the “occupy” movement and fashioning himself its spokesmodel. I saw him on CNBC blowing hard and receiving kid-gloves treatment from Carl Quintanilla. On Piers Morgan Tonight, Moore said, “How could I be in the 1 percent?” When Morgan made the statement that Moore is “worth millions,” Moore responded with “No, that’s not true.” He went on to justify that comment by saying, “Even though I do well, I don’t associate myself with those who do well.” Although Morgan started off a bit confrontational, he, like most other interviewers, backed down fast. In my opinion, a lot of important issues are being brought up by the “occupiers,” but overall, this protest would be better served if those speaking on its behalf were of cleaner hands and less hypocritical than Moore, who has suckled mightily at the teat of “those who do well.”

In 2005, the Weinstein Co. set up financing of about $500 million to fund production and distribution. The investment vehicle was created and syndicated by a little firm called Goldman Sachs. One of the films that was produced by TWC using funds from that investment was Moore’s documentary “Sicko”. Given the success of his previous film, Fahrenheit 9/11, which he made with Harvey and Bob Weinstein, Moore was able to command a terrific deal for himself.

For which he is suing The Weinsteins for  alleged “financial deception” and “bogus accounting methods” in their production deal.

Apparently, the “wage slave” feels he’s owed more $$$ millions. 🙂

By 2010, TWC had burned through the capital raised in the Goldman Sachs deal. Investors were forced to restructure their arrangement, meaning some suffered a devaluation of their investment. Goldman also lost some money it put in TWC, but it could handle the loss in part because it was a recipient of the government’s TARP bailout. Some unlucky investors might never get back the money they put into funding TWC.

Not unlike other bad investments set up by Goldman Sachs and others during this period, some people did make out quite well, while others, often lower on the food chain, suffered. One of those who did quite well using the TWC funds was Moore.

While I don’t know for sure what Moore received on his movie, given his previous success, it likely was several million dollars. Sicko, produced by TWC but released in 2007 by Lionsgate, did not perform as well as Fahrenheit, earning $36 million at the box office. But Celebritynetworth.com pegs Moore’s net worth at more than $50 million, and Moore is suing TWC for $2.7 million more in profits from Fahrenheit. (Reports at the time of the lawsuit said Moore already had received $19.8 million from TWC for that film alone.)

If Moore really wants to be seen as someone outside the circle of those he is protesting, it would be great if he would disclose how much he has made off his TWC-backed movies and why he was willing to associate himself with financing set up by Goldman Sachs. Further, journalists should start showing more backbone in testing the veracity of statements made by those who use the media to disseminate a holier-than-though message.

Never happen. They are too dishonest and in-the-tank for that to happen. There are virtually no actual journalists left, the vast majority are just Propagandists.

There are many reasons our country is in financial trouble, and some do relate to misdeeds by Wall Street executives. Calling attention to such misdeeds and issues of income inequality is a good thing. But the true fault of what put us in this situation resides with the government that gave leeway to those who contributed to political campaigns and provided jobs to those who ran between the various administrations and the private sector. Having a hypocrite blowing hard about groups of people in whose number he himself should be counted diminishes the impact and validity of the message.

Ah, who cares, he’s a Liberal, so we’ll give him a pass…

Political Cartoons by Gary Varvel

Now this made me laugh:

“I have made it to the big time. I’m on MSDNC…”

http://www.youtube.com/watch?feature=player_embedded&v=vitn50hI0OA

 

The Excuse List

During an online “discussion” regarding Libya specifically, a fellow conservative asked how can the Liberals justify this that were talking about and clear out the blue I came up with this list.

This list applies to most, if not all, Liberal responses to most anything.

So with a few tweaks here it is.

You’ve heard of a Bucket List. Well this a bucket of a different kind for a different purpose… <<hint hint nudge nudge say no more…>>

I’m sure It will fall under:
a) children will starve
b) grandma will be eating dog food otherwise
c) well “the richest 1%/2%”….
d) class warfare
e) Threats, Intimidation and Union Mafia mouthing off
f) Whine and cry like a 2 year old
g) But Mommy, so-so non-Liberal did it first…
h) But It was done for the best of intentions…
i) You’re just heartless
j) you’re a rac*st!
k) wingnuts!
l) It was the Tea party’s Fault
m) it was Bush’s Fault
n) It was Halliburton’s/Corporate America’s Fault
o) Orwellian Doublespeak
p) So what?
q) Don’t do as I do, Do as I say!!
r) Damn that Fox News!
s) You’re just Lying!
t) It does not!
u) Well, I have this Liberal report from Media Matters/Huffington Post/Mainstream Media/Liberally Biased Poll that says…
v) They already have a hive-mind Talking Point
w) well, it runs out/starts in 2014 so why do you care?
x) it’s “fair”
y) It feels good….
z) zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

But rest assured…

a) it is never their fault

b) they are always the victim

c) They will fight the very drop of YOUR blood to be right every time.

That about covers it. 🙂

So on that note: Inflation.

It’s real it’s out there. And it’s not “corporate america’s” fault that Raw food commodity indexes, for example, have hit all-time highs. And the broader CRB Commodity Index, including food, energy and industrial commodities, has run up 32% the past 12 months.

It’s really government that causes inflation with actions such as:

• The $2 trillion in money created by the Fed under “quantitative easing” since 2008, an unprecedented shot of liquidity pumped straight into the economy.

• The $5.5 trillion in new debt added by our government in just three years — nearly a 60% rise.

• The Environmental Protection Agency’s move to regulate all stationary producers of carbon dioxide, which has led businesses to put off large investments.

• The surge in regulation at all levels of government, which has added to small-business uncertainty and reduced hiring.

• The record 29% jump in federal spending in President Obama’s first three years, which has crowded out private spending and business investment.

• Spending on TARP and “stimulus,” which could total nearly $2 trillion when all is said and done.

The list goes on. The point is, don’t blame companies like Wal-Mart (CEO of Wal-Mart’s U.S. arm last week he told consumers to get ready for a burst of “serious” inflation) , a proven price cutter, when inflation hits home.

Blame the federal government, which seems dead set on repeating the same errors it made in the stagflationary 1970s. (IBD)

And the Democrats want to whine about cutting 20 billion from 1.5 Trillion dollar deficit this year alone.

And the Republicans want to “compromise”.

I say, screw them both. After all, they are screwing us all in the end.

Political Cartoons by Chuck Asay

Political Cartoons by Steve Breen

Political Cartoons by Glenn McCoy

Welcome to The Future

Political Cartoon

The Most Expensive Congress in History: The 111th Congress.

http://video.foxnews.com/v/4476944/111th-congress-most-expensive-in-history/?playlist_id=86858

When Rep. Nancy Pelosi (D-Calif.) gave her inaugural address as speaker of the House in 2007, she vowed there would be “no new deficit spending.” Since that day, the national debt has increased by $5 trillion, according to the U.S. Treasury Department.

“After years of historic deficits, this 110th Congress will commit itself to a higher standard: Pay as you go, no new deficit spending,” Pelosi said in her speech from the speaker’s podium. “Our new America will provide unlimited opportunity for future generations, not burden them with mountains of debt.”

Pelosi has served as speaker in the 110th and 111th Congresses.

“Our new America will provide unlimited opportunity for future generations, not burden them with mountains of debt.”- Nancy Pelosi, 2007 inauguration speech.

At the close of business on Jan. 4, 2007, Pelosi’s first day as speaker, the national debt was $8,670,596,242,973.04 (8.67 trillion), according to the Bureau of the Public Debt, a division of the U.S. Treasury Department.  At the close of business on Oct. 22, it stood at $13,667,983,325,978.31 (13.67 trillion), an increase of 4,997,387,083,005.27 (or approximately $5 trillion). (CNS)

WHOOPS!

Some of the world’s strongest banks have profited from an emergency credit facility set up by the US Federal Reserve to shore up confidence in the global financial system, according to a Financial Times analysis of data released by the Fed.

More than half of lending under the Fed’s term auction facility – the largest of its crisis programmes – went to foreign banks. Details of the varied uses to which they put it may add to political criticism of the Fed.

The Taf was set up in December 2007 to provide one-month loans to creditworthy banks as markets dried up for lending longer than overnight. In August 2008, it began offering three-month loans as well.

Rabobank of the Netherlands and Toronto-Dominion of Canada, two of the only banks in the world with triple A credit ratings, used more than $20bn in cumulative Taf loans.

Ed Clark, TD chief executive, said that using Taf was logical even though his bank never had a liquidity problem. “That wasn’t how we made a lot of money. But you make a dollar here, you make a dollar there. What’s the spread you make on a billion dollars?” he said. (FT)

WHOOPS!

HAMTRAMCK, Mich. — Leaders of this city met for more than seven hours on a Saturday not long ago, searching for something to cut from a budget that has already been cut, over and over.

“We can make it until March 1 — maybe,” Mr. Cooper said of Hamtramck’s ability to pay its bills. Beyond that? The political leaders of this old working-class city almost surrounded by Detroit are pleading with the state to let them declare bankruptcy, a desperate move the state is not even willing to admit as an option under the current circumstances.

“The state is concerned that if they say yes to one, if that door is opened, they’ll have 30 more cities right behind us,” Mr. Cooper said, as flurries fell outside his City Hall window. “But anything else is just a stop gap. We’re going to continue to pursue bankruptcy until the door is shut, locked, barricaded, bolted.”

You mean the UAW is concerned. The UAW runs the State, or at least in Mafiaoso style they think they do. They have the politicians and media in their pockets and have for more than a generation.

They did when I was growing up in Michigan. Now with the Socialist Wheaties of the modern Liberals behind them I’m sure they are more Tony Soprano than Jimmy Hoffa.

And the last thing the UAW wants is to have their union busted by bankruptcies.

But the inevitable is coming. And THEY DON’T CARE!

Union pensions and benefits, not just the UAW, but Government Public Sector Unions also, and other private Unions have been sucking industry and the taxpayers dry for several generations but the cash cow is out of milk and endanger of dying altogether.

And you know what, THEY DON’T CARE!

Everyone must sacrifice for them. They are holy. They are sacrosanct.

They are untouchable.

So they believe. And since they have been buying Democrats for generations they will be the Pied Piper to all their slave rats.

Because THEY DON’T CARE.

And ultimately, that is the lesson of the last 3 years of Pelosi-Reid and Obama.

They said all the right things to get their hands on your throat and then they throttled you with debt to pass their 90 year old Socialist wet dreams and they are still at it and will be still at it with control of the Senate and the President.

THEY DON’T CARE.

They, and the Unions, are the ultimate in GREED and CORRUPTION.

Prichard, Ala., which stopped paying monthly checks to retired city workers when its pension fund ran out last year, is appealing a bankruptcy judge’s ruling that it did not qualify for Chapter 9 under Alabama law.

And they telegraphed it ahead of time, and no one cared.

A Liberals personal pursuit of everyone else’s money for their own benefit, economically or politically, is all they care about.

It’s all about THEM.

Screw you.

Now that’s your “kind”, “Compassionate” and “caring” Liberals who are always looking out for “the little guy”.

To crush them into slavery and steal everyone else’s wealth and power from themselves.

Officials in Detroit announced this year that they had for years overpaid Hamtramck in a revenue-sharing deal related to a General Motors plant that sits smack on the border of the two cities. The dispute is likely to be resolved, eventually, in court, but meanwhile, Detroit has stopped paying $2 million a year, and Hamtramck is watching a growing gap in its $18 million budget.

Could it be that these “overpayments” were ok until Detroit had to hide it’s own budget woes so they passed it on to another city?

Hmmm….

“Detroit is cutting police, lighting, road repairs and cleaning services affecting as much as 20% of the population,” the Guardian’s Elena Moya noted late Monday, writing about the 60 Minutes piece. “The city, which has been on the skids for almost two decades with the decline of the US auto industry, does not generate enough wealth to maintain services for its 900,000 inhabitants.”

BINGO!

City Manager Bill Cooper said the city of roughly 20,000 people is staring at a $3 million deficit.
California, which faces a $19 billion (some say as high as $26 Billion) budget deficit next year, has a credit rating approaching junk status. It now spends more money on public employee pensions than it does on the state university system, which had to increase its tuition by 32 percent.
“This is the state of affairs in Illinois. Is not pretty,” Illinois state Comptroller Dan Hynes told Kroft.  

Hynes is the state’s paymaster. He currently has about $5 billion in outstanding bills in his office and not enough money in the state’s coffers to pay them. He says they’re six months behind.

“The state’s a deadbeat,” Kroft remarked.  

“Yeah. I mean, the state of Illinois is known as a deadbeat state. This is a reputation that has taken us years to earn and we’ve reached, you know, the heights of, I think, becoming the worst in the country,” Hynes said. (CBS)

The home of our President, Done Proud. 🙂
Unions have a $3 Trillion Dollar appetite and it’s insatiable. And THEY DON’T CARE.
No one is talking about it now, but the big test will come this spring. That’s when $160 billion in federal stimulus money, that has helped states and local governments limp through the great recession, will run out.
You thought TARP was for the “economy”. No, it wasn’t.
It was for the state employee unions and foreign banks.
That’s running out.
Now the wheels of this Cadillac are about to go bald and flat.
Now this is driving a car into a ditch.
And I guarantee you, the Liberals and the Unions DON’T CARE!

Mr. Cooper, the city manager (of Hamtramck), says that everything else that could be cut already has been, while the city goes on spending 60 percent of its total general fund (of an $18 million dollar budget) to pay for its police and firefighting forces — 75 current police officers and firefighters and about 240 former workers and spouses now on pensions. Mr. Cooper said that an entry-level police officer costs the city about $75,000 a year in salary and benefits, and yet repeated efforts to renegotiate contracts have failed.

“They kind of have the Cadillac plan,” Mr. Cooper said, “and we’d kind of like the Chevy.”

Trust me, Unions of all types love Cadillacs.

Growing up in Flint,Mi the one-time home of 7 auto plants and an AC Delco Engine Plant. “Buick City” it was called (there was a billboard proclaiming this 10 miles south of town near Fenton off I-75).

It had a population of 250,000 when I was growing up. Last year it was 125,000 and everyone of those plants had closed years ago.

But growing up my friends and I always said that only 2 kinds of people drove Cadillacs, Pimps and Auto Workers. So no much difference there.

That was the 1970’s. In 40 years it hasn’t gotten any better.

(Found, Mr. Cooper says, posted on the wall of the firefighters’ barracks was his name — crossed out — on a list of former city managers and the word “Next?”)

So let the extortion begin. It’s the only tactic Unions use. Economic and political hardball extortion.

After all, dozens of Unions have been exempted from ObamaCare and their “Cadillac” Health Plans are exempt until 2018.

So it’s not like they care or anything.

“I’m not going to wait for two hours for a cop to show up,” said Shannon Lowell, the co-owner of a coffee shop. “We’ve trimmed every bit of fat. What else are we going to do? Borrow money from our dying grandmother?” (NYT)

Yep. That would also be the grandma who the government is going to pull the plug on because she’s a burden to society according to Medicare and Medicaid Director Dr. Donald Berwick.

Welcome to the Future.

“If you want a vision of the future, imagine a boot stamping on a
human face – forever.”— George Orwell

Michael Ramirez Cartoon

Political Cartoon