Monday, March 23, 2009
The Battle Over CA-10
Wednesday, March 18, 2009
AIG Bonuses are a (green) Herring
This week, hordes of Americans wore green and got wasted. Just like St. Patrick’s Day is a good excuse to get hammered at lunch time, as the Royal Exchange bar near my work was a testament to Tuesday, the $165 million in bonuses doled out to AIG employees this weekend is an excuse for a media blitz to galvanize populist sentiment. Both of these blitzes will likely leave the public with hangovers.
President Obama was right calling the bonuses, to paraphrase, ‘insulting to our common sense and values’. His voice rang loudest in a chorus of Politicians calling for the heads (or the intestinal bowls, in the case of Senator Grasley) of AIG and demanding a list of the bonus recipients in order to ostensibly lambaste and publicly ridicule them. Yesterday Barney Frank,Chairmen of the House Financial Services Committee, demanded from AIG CEO Edward Liddy said list, or threatened a subpoena. Manhattan Attorney General Andrew Cuomo has already started an investigation into the matter. While Liddy, who was appointed by former Treasury Sec. Hank Paulson (along with some Goldman Sachs/Geithner advice) last year to lead the ailing business has reportedly asked for those receiving more than $100,000 to give back the money, this will little assuage the bloodletting that politicians are calling for.
Indeed, along with House Democratic leadership, Congressman Steve Israel called the bonuses “… a mugging on Wall Street. And when you get mugged you want two things to happen. You want justice, and you want your money back.” So what is Congress’ plan? Tax the bonuses, as soon as possible. Congress really gets moving when the populist crowd is frothing. Meanwhile, Secretary of Treasury Tim Geithner offers an executive solution to the problem: to take out $165 million from the upcomming $30 billion that Treasury plans to support AIG with, increasing Federal shareholder value to over 80% of AIG ownership. Taking back $165 out of $30 billion is still a drop in the bucket. It’s like taking a drop of alcohol away from the drunkard who’s grabbing for the whole bottle. This is neither justice, nor will it get our money back.
What is really needed is a more permanent solution that puts greedy drunkards of the public money into rehabilitation and creates huge incentives to move us away from the riskiest moral hazards. This kind of talk may leave many running to do the toilet seat prayer: but unless we sober up to the reality that unfettered greed, political showmaking and bandage solutions will get us no-where, we’ll continue to find any excuse we can to binge on toxicity in the name of green.
Monday, March 16, 2009
Reposting: Immigration Reform, Not Raids, Will Restore Dignity in Meatpacking Jobs
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Sunday, March 1, 2009
Rise of the Childish Cynics
Monitoring the Eruption
Republican Majority Leader John Boehner (OH) called the Stimulus plan a down payment on a "socialist experiment" . Last Friday, in response to the Obama budget, Senator DeMint (SC) went as far as calling President Obama a "salesman of socialism". This from the party that has twice mushroomed the deficit larger than it was when its party took office?
Indeed. But hypocrisy only leads to childish antics with the GOP these days.
The up and coming Governor Piyush (pronounced PEE-ROOSH) "Bobby" Jindal got in line with his party in his response to Obama's address to Congress last Tuesday. While candidly admitting that the GOP deserves its banishment into the political wilderness, he nonetheless went on a tirade to try to frame Republican posturing in terms of 'socialist big government Dems' vs 'the gatekeepers of taxpayer money Repubs' when he said: "While some of the projects in the bill make sense, their legislation is larded with wasteful spending. It includes $300 million to buy new cars for the government, $8 billion for high-speed rail projects ... and $140 million for something called "volcano monitoring." Instead of monitoring volcanoes, what Congress should be monitoring is the eruption of spending in Washington, D.C."
As CNBC's Keith Olberman and Paul Krugman rightly pointed out - the Volcano monitoring is needed to save lives in case of massive erruptions. High speed rail projects? Well, considering that most of the developed world already uses them because they are great for business and decreases our foreign oil consumption: maybe they are not all that bad.
- Make money from it. Whether you are Joe Sixpack or Donald Trump, the climate is rich to invest in opportunities that the administration will surely support. While there is no disagreement that some public money is wasted, there is also little argument against government's ability to spur success in the private sector. From the successes of lots of companies that utilized NASA technology (like Olympic swimsuits and Lithium batteries) to ARPANet that lead the way to the internet as we know it, the goverment has proved to be a catalyst that drives, not hinders the private sector. I am willing to bet that investments in contractors that build schools, companies that manufacture alternative fuels and successful firms that are working on digital health records will all see profitable returns in the near future.
- Follow the money. The President has promised to make his administration one of the most transparent. So far, he has been good to this promise, creating recovery.gov - a website to monitory the stimulus money. If you are a little skeptical of the administration to watch itself, check out StimulusWatch - a site started by researchers and coders. You can use these resources, and presumably ones that will follow them, to advocate your approval or disapproval of how your money is spent.
- Advocate GAO and CRS perform analysis. The General Accounting Office and the Congressional Research Service are both non-partisan research services located in the legislative branch. As citizens, we should remind our representatives and the Comptroller General to ensure analysis and accounting on government programs. Since the Stimulus includes $25 million for the GAO, we need to make sure that the Watchdogs properly report impact and return on investment analysis of the budget and the stimulus package.
The childish cynics and the tired old arguments of a "creeping socialism" need to stop. While opposition within Government is fair, it needs to be more than a slogan hypocritically left to the way side when in power. Critics of the President's fiscal spending need to offer real specifics, not ideological wedges or child speak. The GOP should cease in calling real fiscal stimulus "pork" and cut the political bull. After all: who needs beef in a time of national unity?
