Many many renowned economists wrote a letter to Congress, dated September 24, 2008, strongly opposing the Bailout plan as proposed by Treasury Secretary Paulson. Here's what these renowned economists said:
"As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson to deal with the financial crisis. We are well aware of the difficulty of the current financial situation and we agree with the need for bold action to ensure that the financial system continues to function. We see three fatal pitfalls in the currently proposed plan:
1) Its fairness. The plan is a subsidy to investors at taxpayers’ expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise.
2) Its ambiguity. Neither the mission of the new agency nor its oversight are clear. If taxpayers are to buy illiquid and opaque assets from troubled sellers, the terms, occasions, and methods of such purchases must be crystal clear ahead of time and carefully monitored afterwards.
3) Its long-term effects. If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America's dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted.
For these reasons we ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come."
As that dude from The Onion said on Charlie Rose last night: these are the same people who can't even deliver the mail, fer Chrissakes, and now we're asking them to run the entire Banking System?!
You can see the letter in full with the long list of signatories here: http://faculty.chicagogsb.edu/john.cochrane/research/Papers/mortgage_protest.htm
Showing posts with label bailout. Show all posts
Showing posts with label bailout. Show all posts
30 October 2008
Treasury Department Redacts Bailout Contracts
Meaning, there are huge chunks of these Bailout deals that are being blacked out before they are released to the public--as though they were CIA documents, or something.
Unredacted, these documents would allow the people to know just how their taxpayer money is being doled-out and spent. In our system of supposedly transparent government, this sort of secrecy is unacceptable, and outrageous even to the been-there-seen-that experts and commentators.
Currently at issue: Various law firms, accounting companies and stock management houses are going to receive money from the Bailout fund that we taxpayers provided. But much of that information has been redacted, so that the public can't know the details.
Here's a sample culled from these redacted documents:
The law firm whose rates have been redacted above once offered me a job as an Associate--Simpson, Thacher, Bartlett blah blah... Why their rates are suddenly such sensitive information, I have no clue. Because it doesn't jibe with what I remember.
And redacted documents are hardly new to me. But even I am rather shocked by this shroud of secrecy increasingly surrounding the way the Treasury Department is spending our desperately-needed taxpayer dollars.
You can watch CNBC's coverage of this story here: http://www.youtube.com/watch?v=XbYLf6lU55A
Unredacted, these documents would allow the people to know just how their taxpayer money is being doled-out and spent. In our system of supposedly transparent government, this sort of secrecy is unacceptable, and outrageous even to the been-there-seen-that experts and commentators.
Currently at issue: Various law firms, accounting companies and stock management houses are going to receive money from the Bailout fund that we taxpayers provided. But much of that information has been redacted, so that the public can't know the details.
Here's a sample culled from these redacted documents:
The law firm whose rates have been redacted above once offered me a job as an Associate--Simpson, Thacher, Bartlett blah blah... Why their rates are suddenly such sensitive information, I have no clue. Because it doesn't jibe with what I remember.
And redacted documents are hardly new to me. But even I am rather shocked by this shroud of secrecy increasingly surrounding the way the Treasury Department is spending our desperately-needed taxpayer dollars.
You can watch CNBC's coverage of this story here: http://www.youtube.com/watch?v=XbYLf6lU55A
28 October 2008
Bailout for U.S. Auto Makers?
Um... no. Not unless they can demonstrate that they actually deserve it. And won't fritter our money away. Again.
Because they want a bailout, and are lobbying Congress to give it to them. And but fast. Last month, Congress granted them $25 billion in guaranteed loans. U.S. automakers are now clamoring for $25 billion more. Already!
To follow is my case for why they maybe don't deserve it. Here's a blurb from an earlier posting of mine entitled Going Green To Make Some Green:
"Innovation is Capitalism's best friend. Which is why it boggles my mind that America, which invented the automobile, is now getting its ass kicked by Japan and South Korea in the production of those fuel-efficient cars every fashionable hipster (and responsible consumer) seems to want. What's up with that, Detroit?"
Well, here's what's up. Detroit has successfully lobbied Washington to keep their fuel economy standards ridiculously low. The standards in Europe and Japan are roughly 35 miles per gallon. Only in late 2007 did Congress finally move the U.S. fuel economy standard (currently 27.5) up to match that--but by 2020, twelve years from now. Even China (China!) has higher standards currently. Well. Why "innovate" when you can "lobby"... Right? It's certainly easier on the mind. (Although it explains why the world doesn't buy our cars--why would you buy a car you can't drive in your country?)
You know what else Detroit has done? They successfully lobbied Washington to label SUVs as "light trucks" so they'd only have to meet the standard of 20.7 m/p/g, rather than the 27.5 m/p/g required for cars. (Maybe we should stop calling them "Soccer Moms" and start calling them "Trucker Moms.") And their excuse for why they don't make more fuel-efficient cars? Here's General Motors' response: "We build what the market wants. If people want SUVs and Hummers, you have to give them what they want."
Really? Cuz that's not what I want! Personally, I like to walk... and have been very frustrated since moving out to L.A. County from NYC, where walking and an easily-accessible public transportation system are the norm. I'd really appreciate good public transpo out here in L.A., especially when I've been out-and-about, drinking and carousing, and I'm worried about the specter of drunk-driving. But in L.A., having a car is pretty much a necessity.
But it hasn't always been that way in L.A.--did you know that? Los Angeles once had a glorious cable-car system. But it was ripped out, thanks to those who favored (and I'm sure lobbied heavily for) cars-for-everyone and urban sprawl--you wouldn't believe the sprawl in L.A. And I've never seen so many strip malls in my life. I fled the suburbs of Chicago in large part to get away from the strip-malls. Oh the irony...
And see, our Addiction to Oil is very much related to our current woes--economic, military, environmental, political, and moral. (See my earlier posts if you need convincing). And the taxpayers hardly have $25 billion to waste on an industry that has very much contributed to our woes and seemingly refuses to innovate. Which is what Capitalism should be all about.
Here's the article that "fueled" this post: http://www.latimes.com/business/la-fi-autos28-2008oct28,0,1118586.story?page=2
And if it makes you as pissy/snippy as I'm currently feeling, start contacting your elected officials. Please.
Because they want a bailout, and are lobbying Congress to give it to them. And but fast. Last month, Congress granted them $25 billion in guaranteed loans. U.S. automakers are now clamoring for $25 billion more. Already!
To follow is my case for why they maybe don't deserve it. Here's a blurb from an earlier posting of mine entitled Going Green To Make Some Green:
"Innovation is Capitalism's best friend. Which is why it boggles my mind that America, which invented the automobile, is now getting its ass kicked by Japan and South Korea in the production of those fuel-efficient cars every fashionable hipster (and responsible consumer) seems to want. What's up with that, Detroit?"
Well, here's what's up. Detroit has successfully lobbied Washington to keep their fuel economy standards ridiculously low. The standards in Europe and Japan are roughly 35 miles per gallon. Only in late 2007 did Congress finally move the U.S. fuel economy standard (currently 27.5) up to match that--but by 2020, twelve years from now. Even China (China!) has higher standards currently. Well. Why "innovate" when you can "lobby"... Right? It's certainly easier on the mind. (Although it explains why the world doesn't buy our cars--why would you buy a car you can't drive in your country?)
You know what else Detroit has done? They successfully lobbied Washington to label SUVs as "light trucks" so they'd only have to meet the standard of 20.7 m/p/g, rather than the 27.5 m/p/g required for cars. (Maybe we should stop calling them "Soccer Moms" and start calling them "Trucker Moms.") And their excuse for why they don't make more fuel-efficient cars? Here's General Motors' response: "We build what the market wants. If people want SUVs and Hummers, you have to give them what they want."
Really? Cuz that's not what I want! Personally, I like to walk... and have been very frustrated since moving out to L.A. County from NYC, where walking and an easily-accessible public transportation system are the norm. I'd really appreciate good public transpo out here in L.A., especially when I've been out-and-about, drinking and carousing, and I'm worried about the specter of drunk-driving. But in L.A., having a car is pretty much a necessity.
But it hasn't always been that way in L.A.--did you know that? Los Angeles once had a glorious cable-car system. But it was ripped out, thanks to those who favored (and I'm sure lobbied heavily for) cars-for-everyone and urban sprawl--you wouldn't believe the sprawl in L.A. And I've never seen so many strip malls in my life. I fled the suburbs of Chicago in large part to get away from the strip-malls. Oh the irony...
And see, our Addiction to Oil is very much related to our current woes--economic, military, environmental, political, and moral. (See my earlier posts if you need convincing). And the taxpayers hardly have $25 billion to waste on an industry that has very much contributed to our woes and seemingly refuses to innovate. Which is what Capitalism should be all about.
Here's the article that "fueled" this post: http://www.latimes.com/business/la-fi-autos28-2008oct28,0,1118586.story?page=2
And if it makes you as pissy/snippy as I'm currently feeling, start contacting your elected officials. Please.
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