The Financial “Crisis” Produces An Unwelcome Shift In Power
Monday, January 26th, 2009The Davos summit is going on–you know the place where self-important celebs fly in on their private jets and lecture the little people about incandescent light bulbs. In past years, the important people had the luxury of talking about such silliness. Now, the economic situation is serious and the maneuvering at this summit has huge implications for you and me.
Here’s what’s happening via the International Herald Tribune:
Politicians, not corporate titans, are poised to be the big draw this year, echoing the broader power shift away from the free market as one government after another tries to prop up its sinking economy.
This time, the prototype of the jet-setting “Davos Man” may well be Gordon Brown, the dour British prime minister, who spent last week staving off another round of bank failures in London.
And with much of the financial system in Britain and the United States edging toward a possible government takeover, the 2009 agenda at Davos, “Shaping the Post-Crisis World,” seems to have concentrated minds on the here-and-now more than past themes like climate change and globalization.
“The pendulum has swung and power has moved back to governments,” said Klaus Schwab, the German-born economics professor who founded the World Economic Forum in 1971 and has been its impresario ever since. “This is the biggest economic crisis since Davos began.”
I have written before both here and for Pajama’s Media that global warming and dealing with climate change is a luxury. That is, when everything is going relatively well, those in power need to create a crisis of some sort in order to feel useful. Climate Change is an indulgence both financially and emotionally. It distracts from real, existential issues before us–like the Iranians sending a ship full of bombs to Hamas on inauguration day.
So banks teeter on collapse! Debt is at unprecedented levels! The government wants to help! The sky is falling! Only problem is that the millions they want to spend to get us out of the mess is not going to help. The stimulus package will stimulate nothing besides funding leftist groups like Acorn that Obama intends to pay off.
But really, this panic is about seizing control. While the U.S. isn’t bankrupt, it does need to right the ship. Not that Congress or the unions or even bailed out banks (this link will get your blood boiling) are acting like any change is necessary.
Essentially, the government wants to take tax payer dollars and give it to companies who have been irresponsible. And businesses have lost any sense of pride and are lining up with hands out. But more than that, the ones getting pay-offs are the ones who have bought influence before. So money is being taken from those who have little influence and given to those who do.
There has been a shift in power, alright. Since money equals power, power is now concentrated in the hands of government. Individuals and businesses with little in the way of influence get nothing. Big companies who can afford to buy favor grovel before their new masters. You and I sit on the sidelines, helplessly.
Obama is turning out to be different alright. He’s even more consumed with consolidating power and wielding it to make the little guy submit. But that’s okay, right? He’s a Democrat and a liberal so he’s only doing what is necessary.
Cross-posted at RightWingNews.com
Mark Steyn:
Sunday, January 25th, 2009United States of Emergency
Declaring an emergency to get money to Obama inauguration.
Government Can’t Save You: Just Live Your Life
Wednesday, January 21st, 2009The government can’t save you. But you can save you. Is life really that bad out there? I still don’t believe America is anywhere near the misery of the 1920s and 1930s.
I actually think Americans are still relatively wealthy. Even with cutting back, people have accumulated so much stuff, unnecessary stuff, that a couple year recession could take hold and people could maintain their currently obscene standard of living.
So, when there is talk of government bailouts and stimulus packages, what needs to be stimulated, exactly? People who are given something for nothing aren’t usually grateful for it. To quote Rihanna and TI:
Some move away to make a way not move away cause they afraid.
I’ll go back to the hood and all you ever did was take away.
Much to the chagrin of my friends, I enjoy hip-hop. This song is about making it, seeking after fame and money and the vagaries within. So a guy makes it, goes back, and people take. He counsels gratitude for what they do have, but no. They “chase paper”.
You know, the government will receive no more gratitude than a flush friend who’s generous should it decide to be the new Mommy Givebucks. People tend to be a whole lot more thankful for what they work for than what they’re given, no strings attached. This is not always the case. I’m reminded of the one (out of 10) blind men who came back and thanked Christ for restoring his sight. That ratio seems about right. Maybe 10% are grateful for what they’re given.
It is important for us, as citizens, to decide exactly when and how the government should be involved with being a safety net and what form that takes. A system that implodes under the weight of largess or steals from the next generation is not being generous but immoral. In order for there to be something around for later, those given to now should be deserving and actually helped, rather than be enslaved.
There are a whole host of government social programs, art funding, research projects and ego-enhancing public works. We don’t get something for nothing. Someone, you, is paying. What do you want to pay for?
Citizens Against Government Waste and this site have some lists of things to cut. More from the Heritage Foundation. What do you think should stay and go?
Cross-posted at RightWingNews
Print More Money! Oh wait…. UPDATED: Now, With Zombies
Friday, January 16th, 2009Here is your brain on liberal fiscal policies:
California’s controller says he will begin a 30-day delay on tax refunds and other payments starting Feb. 1 because the state is running out of money.
The solution, of course, isn’t to cut spending, scale back on largess and live within one’s means. The solution is to print more money. Why won’t the Feds do this? Oh right, they are printing more money. They print it and now own the banks that house the money they print.
You know what’s great about this? We are becoming just like Europe. Maybe they’ll like us now.
UPDATED:
From Business Week, this scary scenario:
Zombies. Seen one lately? If not, you may soon, because they are about to menace the U.S. economy. In financial lingo, zombies are debtors that have little hope of recovery but manage to avoid being wiped out thanks to support from their lenders or the government. Zombies suck life out of an economy by consuming tax money, capital, and labor that would be better deployed in growing companies and sectors. Meanwhile, by slashing prices to generate sales, zombie companies can drag healthier rivals into insolvency.
Sometime in the past few months, zombies went from being a latent risk to a genuine threat—one that is likely to increase in the months ahead. The Bush Administration has already ladled out billions of dollars in assistance to weak banks and automakers. As the economy goes into what may become the worst economic downturn since the Great Depression, the Obama Administration will come under even more pressure to prop up sick financial and nonfinancial companies to save jobs. The debate will center on wounded giants such as Citigroup (C), General Motors (GM), and insurer American International Group (AIG). Other sectors with their hands out include steel, airlines, retail—and homeowners, who may be the scariest zombies of all.
It will get worse. No one, it seems, wants to endure the pain that comes from undoing trouble that took a long time to create.
What We Need Is More Government Opacity
Thursday, January 15th, 2009The problem is, see, that Americans are too concerned about where their tax dollars are going. It’s none of their damn business. Please note the irony of Barney Frank being the chairman on this committee when it was his stupid policies that caused the bank implosion to begin with. But that’s ancient history. Today, he sits, without shame, questioning a Fed official who, without shame, thinks it better that Americans don’t know exactly which institutions have received 1.2 trillion dollars since September.
It’s Okay To Be A Slutty Feminist
Monday, December 22nd, 2008It’s Okay To Be A Slutty Feminist
As long as you don’t get paid for it and you’re ugly. [Linked fixed]
The Sky Isn’t Falling Quite Yet
Wednesday, December 17th, 2008So I put up a link that makes it seem like the United States is bankrupt–like bankrupt now. Turns out that the data The DC Examiner reported on is manipulated and essentially crap:
The United States of America is bankrupt. Don’t believe it? Consider this: Federal obligations now exceed the collective net worth of all Americans, according to the New York-based Peter G. Peterson Foundation. Washington politicians and bureaucrats have essentially mortgaged everything We the People own so they can keep spending our tax dollars like there’s no tomorrow.
The foundation’s grim calculations are based on Sept. 30 consolidated federal statements, which showed that Americans’ total household net worth, diminished by falling stock prices and home equity, is $56.5 trillion. But rising costs for unfunded social programs like Medicare, Medicaid and Social Security increased to $56.4 trillion – and that was before the more recent stock market crash, $700 billion bank bailout, and monster federal deficits chalked up in October and November.
“Given more recent developments, it’s clear that America now owes more than its citizens are worth,” said Foundation president David M. Walker, the former Comptroller-General of the United States who has been trying to warn Americans of the coming financial tsunami for years, to no avail. So, after Uncle Sam bails out bankers, Wall Street gamblers, carmakers and over-their-head homeowners, who’ll bail out Uncle Sam?
They palmed a card, actually two cards: the first one is they’re using household net worth … but that leaves out corporate net worth, so they’re ignoring, eg, Exxon. The second is that they’re comparing future obligations to pay with current assets, so it’s like saying you’re “bankrupt” because the total of your expected future living expenses exceeds your net worth.
I wrote about the same comparison in PJM early in the year — can’t link it usefully, PJM has hosed something — making the correct comparison of total US assets per person versus total US obligations per person, and it was about $300K assets vs $160K obligations, or over the whole population, about $90 trillion versus $48 trillion. Most of that wealth is real stuff — land, houses, factories, etc — and hasn’t gone away in the last year.
You know, things are bad enough right now. Much of the economic stall these days is because companies are just sitting and holding. That is, they aren’t taking risks to grow, expand and innovate because they don’t want their cash tied up if the whole shebang is going to implode. Well, it starts to become a self fulfilling prophecy.
There is no question that people have lived beyond their means and some have gone so far that they can’t get it back. It is going to take some time to correct this cultural problem. People are going to have to cut back and pay off debt.
There is no question that the banking industry and the people on Wall Street played with funny money and in some cases outright defrauded people. It is important to remember that stocks and funds are only as good as the businesses they back and the people who are in those businesses. The pressure to perform and profit at all costs creates an environment ripe for fraud.
Even with these problems, it does not help the economy or the American psyche to find problems where there aren’t any. This behavior causes more problems and its irresponsible.
Cross-posted at Right Wing News
The Day Of Reckoning?
Wednesday, December 17th, 2008The Day Of Reckoning?
When the chips are called in…..
Even Houston Has Pension Woes
Thursday, December 11th, 2008Even Houston Has Pension Woes
Houston’s economy is good. What’s the deal?
