Where Does It All End?

December 27, 2008

I read today that GMAC has been declared by the government to be a “bank,” so that they can get some of the handout money.  No big surprise – if you’re going to bail out a car company, why not bail out the finance company that they own that loans people money to buy their cars?  As ludicrous as this is, the reality is that, if the recent history of the bank handouts is any indication, the money will go to executive’s pockets.  I especially like the so-called multi-million dollar “retention bonuses”  they are handing out to their executives, which is basically saying “We will give you fifty million dollars right now if you agree to continue to lead our company down the toilet for another year, for which we will pay you one hundred and fifty million dollars.”  Hell, give ME two hundred million dollars and *I* will run a company, pay my employees and suppliers twice what I should, and make products that nobody wants, but are greatly are over priced.

This holiday season was apparently the worst in a while for the retail industry.  So, some group in that industry (a “Retail Federation?”) has asked the government to allow them to have three days where they can sell products and not have to charge sales tax, to try to sell more products and make even more money.  The catch is that they want the government to PAY RETAILERS what they would have charged in sales tax!  If the retailers think that people will suddenly decide to buy crappy over-priced Chinese-made products just because they can get them for 3-7% less, then maybe the retailers should re-examine their pricing. 

The “National Bicycle Distributors” (or something like that) has asked for a handout, claiming that this would somehow allow them to sell more bicycles, which would then be used by more people to replace their cars, thus saving gas.  Before long, I expect the National Sneaker Importers to demand a handout so that people can afford to WALK.  Considering that some of the trendy sneakers cost more than the average bicycle, it can’t be far behind.

 If all of the multi-billion dollar companies have their way, the federal government will just take all of our paychecks and savings and hand them over to the companies.  If the companies can’t get our money by selling us something, then, by golly, they will just have someone steal it from us and hand it to them!



Social Unrest? That’s What the Media Wants Us to Believe

December 23, 2008

Alarmist or prophetic? I don’t know. Read it and see what you think –

Protectionist dominoes are beginning to tumble across theworld

This is about the fifth thing I’ve read in the past week that mentioned “global unrest” and riots. As with everything the media does, if the media constantly repeats the same prediction over and over for long enough, people start to believe it, and it eventually becomes true.

A better question is “should we allow the media to create our realities?” There is no real social unrest in this country as of now, at least not quite as much as there was during the Bush I and Clinton years, and certainly nothing to compare with the 60s and early 70s. I’m not sure why, since we still have the government passing unConstitutional laws, an unjust and unConstitutional war, and a greatly increased militarization of the “police.”

The “poor” are still there, in probably about the same percentages. Will they really care if the stock market drops even more? I doubt that it will affect their portfolio much.

Doctors and lawyers? Well, doctors will undoubtedly be on the government payroll shortly anyway, and lawyers are, well, lawyers. They file lawsuits. They may bury the court system in paperwork and bring it to a screeching halt, but is that really a bad thing?

Government workers who are “downsized?” They are lowly apparatchiks – they are part of the problem. What do they expect?

Now-jobless auto-workers? I must say I have little sympathy for them. When given the choice by Congress whether they wanted to save their companies and take a pay cut to more reasonable salaries, or risk having their companies close and thus be completely out of a job, their union refused to accept a pay cut. They don’t care what happens, as long as it doesn’t diminish their hefty paychecks, and thanks to Bush II’s Executive Order of dubious legality, even by their standards (but obvious unConstitutionality by ours), those appear to be secure, at least until the car companies squander this 15 Billion Dollars.

But, “widespread social unrest” and “massive riots?” I don’t see how instability in the stock market is going to cause Americans to break out in spontaneous riot. What I *DO* see as potentially causing serious problems, is the government’s response to the stock market “crisis.”

For example, the car companies claimed that they were losing something like 20 Billion per month, total (about 7 Billion a month for each car company, is the number I saw). In response, Bush II essentially took 15 Billion dollars of the 700 Billion dollars that the government stole from the taxpayers, and handed it to two of the car companies. If my math holds up, and the car companies really DO lose 7 Billion per month each, that means that the two car companies that got the gift can each last for another month before asking for another handout.

So, the government stole seven hundred billion dollars from the American citizens, with the promise that it was going to be given to the banks so that the banks would start lending money to the citizens again. As stupid, unConstitutional, and bizarre as that concept is[1], that isn’t even what happened. Instead, the banks took that money, used it to pay hundreds of millions in perks, bonuses, and benefits for their executives, and used the rest to purchase other banks. Then, the government took what was left, and handed it to the car companies, who ‘promise’ to make changes sometime in the future. Not only did the government steal from us, but they lied about what the money was going to be used for. And they expect us to not be pissed?

If THE GOVERNMENT starts to believe the media’s constant mention of riots and social unrest, they will do what governments always do: The Wrong Thing. They will increase regulations on speech. They will increase penalties for certain (sometimes un-named) crimes against The State. They will attempt to infringe gun owner’s rights. In other words, the government will, by its own actions, CAUSE that which they supposedly wish to prevent.

[1] I mean really – stealing 700 BILLION DOLLARS from the citizens to give to the banks, so that the banks will start to LOAN money to the citizens?? I would say that amounts to something beyond a bank executive’s wildest dreams. If Monty Python had done it, it would have been hilarious because of its absurdity.

Carl Levin, Credit Cards, Auto Makers, and Logic

December 19, 2008

The federal government recently passed a bill which places restrictions on how and when a bank can increase the interest rates on credit cards. It also requires that banks give customers 45 days notice before the rates are raised.

Sen. Carl Levin, D-Mich, an advocate of the bill, says this bill is “a good first step, but they don’t prevent a number of unfair, deceptive and predatory practices that saddle many American families with crushing debt.”

Oddly enough, this bill which so many congressmen says is vital and important step to protect citizens from capricious rate increases, which many fear will stem from the banks’ efforts to increase profits even more than they currently enjoy.

Levin says: “Every day, the taxpayer is being asked to foot the bill for our biggest banks’ irresponsible lending practices.” “America’s banking giants can’t be allowed to dig themselves out of the hole they are in by loading up American families with unfair fees and interest charges.”

Levin, you may remember, voted for the massive bank handout, and also championed the auto company handout, which will not only devalue our dollar, but place an enormous tax burden on every man, woman, and child alive today, in addition to every citizen for decades to come.

Here’s a link to the article:

Levin and federal bill to restrict credit card issuers.

I guess Carl is more concerned with his credit card bill than he is with multi-trillion dollar federal deficits and the stunning debt burden he has helped place on us and our descendants. While he may have saved us from a couple of hundred dollars of interest on our credit card bill, simultaneously, he was helping straddle us with the 700 BILLION dollar handout which was supposed to ‘buy’ bad debt from the banks so that it would free up their money so they could then start loaning to consumers again. Once the money was handed out, that goal changed, of course, and the banks immediately used the money to start buying up other banks. Once you’ve been rewarded for failure, it’s time to spread your failures to more and more institutions. Now, part of that $700 Billion is being given to the car companies who have run themselves into the ground. It is not technically a “loan,” since the government says it must be (ha ha) “paid back within three years” (nudge nudge). Of course, the auto companies claim that they are losing many billions of dollars EVERY MONTH, so paying back a multi-billion dollar loan in three years shouldn’t be a problem, eh?

If the car companies’ claims that they are losing a combined $21 billion each month is true, then the federal government is the definition of “fool” for being suckered into what will undoubtedly end up being a bad loan, if indeed it was ever intended to actually be a loan.

But, with a backdrop of this staggering situation, Levin and his ilk are concerned with rules regarding when your credit card company can raise its interest rates.

Anyone ever hear the term “Penny wise and Pound foolish?”