Thursday, September 25, 2008

Let A Judge Set the Bail, Not the Congress

  Congress continues to debate how to bail out the speculators on Wall Street.   What's the problem?  Usually the judge sets the bail, and the family raises the money.  Why are we, the American people, involved?

  There are goat herders and taxi drivers who have been sitting in Guantanamo Bay for over seven years, with no bail set yet, let alone a trial date.  And surely not a one of them has caused as much destruction as the Masters of Wall Street, so far.   The only one at Guantanamo who did get a trial was tried on a crime that was made illegal two years after he'd been imprisoned. (This is a variation on the theme of this Congress, who made George W. Bush's felony of spying on the American people legal-seven years later).   Surely, if they can't come up with a crime that these titans have committed, they can retroactively make one that fits.

  The massive speculation that has been going on for the last few years has all kinds of names that I don't understand, like credit derivatives and such, but I can certainly understand what has happened.  It's a Ponzi scheme, gone wild.  And I can understand that Ponzi schemes are illegal and doomed to collapse.   (Follow the link I provided to get the official US government SEC statement on that).

   But the last ones to invest in a Ponzi scheme are the ones who are ripped off the most.  And that's why Henry Paulson is threatening Congress.  He wants the American people to be left holding the bag.

  And here's the thing.  Congress is going along with it!   Democrats posture by claiming to put restrictions on it.  Like limiting the salaries of the crooks to $73 million a year!  Are they joking?  Sadly, no.

  Some are sternly demanding "shares" for our money that we've invested.   "Shares" are pretty pieces of paper that corporations used to give out when people invested in them.  My mom showed me some that her father had bought.

  This shouldn't be that hard to understand.   Now they're working a shell game on us to get us to invest in the Ponzi scheme.

   Follow the pea.   This speculation was all based on MORTGAGE-BACKED securities.  These MORTGAGE-BACKED securities were repackaged and sold, again and again until the amount they were being sold for had absolutely no bearing on the value of the actual MORTGAGES that were supposedly BACKING them.  That's how AIG got involved.  Remember the insurance company that we bailed out last week?   They were insuring the worthless MORTGAGE BACKED securities. 

   These are the same MORTGAGES that are now coming due, and that Henry Paulson says are worthless, so the families that have been paying into them should be thrown out onto the street.    

    So the MORTGAGES that are so worthless that families deserve to become homeless are the same MORTGAGES that the American people are being forced into buying, (marked up trillions of dollars) from the investment speculators, because they are too big to fail.  

     No, they're not.  Some of them have already failed.   Some have already written off billions of dollars.   Henry Paulson is trying to save his old employer, Goldman Sachs, by putting one more layer of suckers into the scheme.   And he's probably got a back-up place on an island somewhere for when the American dollar fails.

     Lehman Brothers sold its mortgages for pennies on the dollar when it went under.   Let the others fail.  That's what a "free market" is.  But sell the mortgages back to the homeowners at reduced prices as part of the restructuring deal, whether a solvent bank or the government takes them over.

      That way people can stay in their homes.   Whoever buys the mortgages will have them paid off.   We won't have to deal with millions of homeless and hundreds of thousands of vacant houses in America.

     And we can throw the bums in jail and let their families bail them out!


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Saturday, September 20, 2008

Why Save Capitalism?

Most Americans are surprised at the collapse of capitalism.   I'm surprised it took so long.

I was brought up with 19th century beliefs, and Depression era values.   My parents suffered greatly as children in the Depression.   They expected another depression at any time, and passed that along to us children.

I was taught that capitalism couldn't work, because it relied on profits to continue, and that there would always come a time when profits would decrease, since the workers weren't paid the full value of their labor, and so were unable to buy enough back to keep profits coming to the capitalists.   

But the genius of capitalism that we keep hearing about has kept it going for a century more than expected by 19th century dreamers.   Two world wars and the great depression destroyed a lot of productive capacity, and the rebuilding after those disasters made it seem as if capitalism was booming.  All you have to do is disregard the human misery caused by these tragedies, and it appears that all was well.

The military-industrial complex created much "value" that didn't have to be bought back by the producers and brought foreign dollars eager to buy the weapons of mass destruction that Americans produced.  And the cheap labor and materials that America's military power provided the homeland made US worker's wages go farther.

Cheap foreign labor and endless credit seemed to work.  Even though people have been warning that this can't last, it certainly seemed to go on long past the time it should have collapsed.   Here's a warning from TWO years ago that it was all about to blow!

Now we're being told that the whole problem is greedy Americans who wanted to buy houses they couldn't afford.   No, that's not the problem.  

The problem is that Americans were given loans that were then packaged and resold again and again.   Obviously, a loan for, say, $500,000, which is resold to speculators until it is "worth" $5,000,000 isn't really worth $5,000,000, because even if the loan resets at a higher rate, the homeowner can't pay that much money.  Especially because half of working Americans make less than $40,000 a year.  But the world economy has been propped up by this creation of "wealth" for the last 8 years, at least.

Back to basics.  How can a people who make less than $40,000/year support the world's economy?  No matter how little the Chinese workers make, at some point America can't buy their products.

And how can Americans who can't pay their mortgages pay enough taxes to buy out AIG, Fannie Mae, Freddie Mac, etc, etc, etc?   The personal debt of Americans used to equal to the public debt (until last week).   

These government buyouts are pretending that people who can't pay their credit card bills or their mortgages can now pay all that, plus interest and million dollar salaries to the CEOs, to boot.

So will capitalism finally collapse?   And what will replace it?

I vote for cooperative sustainable peaceful relations among the people of this planet.  I vote for production for use, not profit and a system that lives lightly on earth, instead of exploiting and polluting it.  Our home planet, our only planet.

The alternative is mass misery, possible accompanied by war and/or famine, and a continued destruction of our ecosystem.

It seems like an easy choice.   Oh, wait.  There's no election that let's us decide.

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Wednesday, September 17, 2008

Nobody Ever Went Broke Underestimating the Stupidity of the American People

The American people are now underwriting the bad debts of the gamblers that control our country.  That's bad, but to add insult to injury, they are spinning it as our self interest.  How long can people be fooled?  As even Bush said,  Shame on you. We won't be fooled again.  

The US is the only industrialized country without a national health care system.  We are told that private is best.  So we pay middlemen upwards of 30% of our healthcare dollars to deny us healthcare.  It's great to be free!

In the 80s and 90s, corporations shed their pension plans to save them money.  Workers now had to provide for their own retirement.  It was sold as, yes, again, freedom.  You were free to put money into the mutual fund set up by your corporation in lieu of them taking responsiblity.

Then they tried to go after Social Security.  There was some pushback on this.  I think it failed because Congress needed those billions of dollars in our trust fund to balance the budget, so they refused to turn it over to Wall Street.   So they still owe us that money.

But now they're bailing out Wall Street, and they're doing it in the name of we, the people.  Yes, we must save Wall Street because our private pension funds were being gambled, along with the exorbitant profits they had been making.  

So, now we must finance our retirement, like our health care, by paying outrageous sums to middlemen to give us back that which we have invested.

Thanks a lot, Uncle Sam.   

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Tuesday, September 9, 2008

The wages of sin is death, but the profits on sin are fantastic

When did home prices rising yearly become a good thing?  In the 70s, it was recognized that housing inflation led to inability for regular people to buy houses.  This was considered a bad thing.  Rising home prices were bad even for people who owned their homes, because property taxes rose with property value, even if the wages or Social Security income of the owners did not go up.   It is absurd to tax people on their homes, instead of their income, but in a system that is dependent on property taxes, rising home prices with stagnant income is obviously a bad thing.  Why are real estate speculators and home "flippers" admired instead of condemned?

But in an economy which depends on speculation and debt to function, there are fewer people speaking out against housing inflation than speak out against apple pie or the flag.   Now we get talking heads announcing that bailing out Fannie Mae would lead to a rising housing market!  Yay!  

Gas prices rising, on the other hand, makes the talking heads use frowny faces.  Why?  Why are high home prices good and high gas prices bad?    Not everyone has a car, but everyone needs a place to live.  And there are people who have cars they can't afford because they can't afford to live close to where they work. TV news goes to the gas stations and listens to the sob stories of people filling their SUVs.  Why not go to people who are living 2 or 3 families per house, and listen to their stories?  

Usury and gambling used to be sins, and illegal to boot.  Now we have payday check cashing on every corner, and the government uses the tax code to enforce legalized gambling with our retirement money.  I even got a note from my employer stating that the Federal government was telling them to increase my "contribution" to my 401K (which I think is a farce), unless I gave them written notice not to.  Now how many people are going to get around to turning in that notice? (I haven't yet.  Procrastination works for them).

In the 18th century, drugs were legal and Coca Cola had cocaine in it.  But they had debtors prison for those who couldn't pay their debts.   It seems that fashions in sin change as much as hemlines.

America has over 2,000,000 people in prison now, and over half are there for the victimless crime of drug use.  Can you imagine the explosion in the prison population if we started jailing debtors?   I probably shouldn't suggest it, or CCA will start lobbying for it.

In the 1970s, increasing the supply of money led to inflation, and the Federal Reserve tried to stimulate the economy without increasing inflation.  In the late 70s four things happened. (OK, lots more than that, but to make this point, say 4). Saving and loans were deregulated, computers became much more common, the dollar went from being backed by gold to being backed by oil and the ruling class decided to break the deal with the working class made after WW2 where they shared more of the wealth produced with the actual producers.   Wages have dropped since then, the manufacturing base has been moved elsewhere, and the bottom 80% of the American population has gotten poorer.   How have they maintained their standard of living?  Like the guy in the commercial says, "I'm in debt up to my eyeballs".

I'm no economist, but it seems to me that part of the way that they are able to keep increasing the money supply without causing the runaway inflation you saw in Weimar Germany is that they used computers instead of printing presses.   It's all pretend, but if we just believe in it, the system works.  The increase in money supply is done virtually, and we don't actually get the cash and then hand it over, we use cards and computers.  We go to work and they give us a paycheck, which we can exchange for food, clothing,  shelter and trinkets.  As long as every pretends that it works, it does.  The farmers produce the food, the carpenters build the homes, and the workers in China produce the clothing and the trinkets.

And the rest of the money, the money that the capitalist class siphons off of the rest of us, is gambled away.  They gamble in the stock market, the money market and other markets that are way above our heads to understand.   The important thing is that the money gambled is not real money, so it doesn't matter to us.

Until it does.   Apparently,  capitalists in other countries are tired of playing the American dollar game, and want to call a halt to it.  Uh, oh, we're in trouble now.  So the US government steps in and takes over Freddie and Fannie and announces that the full backing of the US government is now behind them and we will create as much pretend money as is needed to protect the investments.    Will it work?  Maybe, because it is to everyone's benefit to continue pretending and not bring the world economy down around all our heads.

I keep pointing out that if we can take care of our needs with pretend money, we can do it without it.   We can produce food for each other, and housing, clothing and trinkets, and exchange them between ourselves without the whole siphoning off and gambling part.  We can do it without invading Iraq or Georgia to keep control of the oil, and we can do it without having homeless people while others have 7 or 8 houses.  

We can use the productive forces of our society for good instead of evil, to use George's frame. 

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Monday, September 8, 2008

McCain/Palin - the Alan Keyes of 2008

Calm down, Democrats. Let me tell you a story from Illinois.

In 2004, Barack Obama was chosen to run for the US Senate on the Democratic ticket. Opposing him was a good looking, fairly moderate Republican, Jack Ryan. He was an opponent who could have beaten Obama.

Then, there was a scandal! A sex scandal! And Jack Ryan was forced to make his divorce records public. I thought that was weird at the time, but I didn't understand the plan. Although he and his ex-wife, Jeri Ryan (of Star Trek and Boston Public fame) didn't want to release the documents, they were forced to, in the interests of public knowledge. (Yeah, unbelievable, I know, after years of governmental secrecy on important matters, we needed to know someone's sex life).

So, here's the sex scandal. He wanted his wife to participate in public sex. With him. Huh? Don't Republican sex scandals usually involve some guy caught snorting meth off the belly of a teenaged boy prostitute? How is a marital disagreement (that the wife won) grounds for disqualification for running for office? But before you could say Spiro Agnew, Jack Ryan was gone.

The Republicans replaced him with a crazy right wing Christian African American from Maryland! Talk about a ringer. There was no way that Alan Keyes could have won that election. Obama won by 70%. (Proving once again, that 30% of Americans are nuts. Those are probably the same ones that still think Bush is doing a good job).

So now, here we are in the 2008 election. Who have the Republicans put up this time? A man who the right-wingers hate. A man who isn't even ELIGIBLE to be President. The Constitution says that a President must be age 35 and born in the United States of America. McCain clearly is old enough, but he wasn't born in the US. He can't be President.

And now they've nominated a woman who abused power as the mayor of a town of 7,000. It's pretty bad when you know your neighbors and you still fire the librarian because she wouldn't ban the books you told her to. She also ran the town into debt. For Republicans, that should be a deal breaker. They're all about balanced budgets, or so they say. Will it really be enough for the base that she's a crazy right wing Christian who thinks that God wants the US to attack Iraq and to build a natural gas pipeline?

The media can play her up as a gutsy beauty queen all they want. I don't think many people will fall for this ticket. About 30%, I'd guess.

It doesn't really matter how people really vote. The voting machines are probably already set at a predetermined rate. I'm guessing 49% Obama, 48% McCain, just to make people think we're more closely divided than we actually are.

We are getting the close polls and the endless drama to keep our minds off the economy and the wars. It's all bread and circus, all the time.
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Saturday, September 6, 2008

The Wide Gulf Between Democrats and Republicans

Many have pointed out that while Americans can choose between dozens of brands of cereal or detergent, we are sternly restricted to two choices for President. Americans who refuse to pick one of the two are excoriated roundly by their fellow citizens, who accuse them of being responsible for every bad thing that happens in the administration of whoever won.

The differences between the two official parties were made crystal clear, though, in the recent convention proceedings. Truly, this is a choice we can believe in!

When Obama talked about offshore drilling and the need for clean coal and nuclear power, the Democrats didn't clap. But when Palin and McCain talked about offshore drilling, and the need for coal and nuclear power the Republicans did clap. This is a clear difference.

Of course, when Obama talked about the need for solar, wind and biofuel energy, the Democrats did clap. But so did the Republicans, when Palin talked about the need for solar, wind, geothermal and other alternative energy sources. So, that's a draw.

Both parties are for education! And both cheer when their candidates saber rattled - Obama against Afghanistan, Pakistan, and Russia, McCain against Iraq, Iran and Russia. Both, of course, against alQuaida, wherever they may be.

And, for some reason, both parties speak of individual embattled Americans by name, both to point out their misfortune and to announce that life should really be better for these people.

No major media covered the Green Party Convention, and only C-Span showed Cynthia McKinney's acceptance speech. But Cynthia McKinney didn't call for offshore drilling, or more coal, or more nuclear power plants. She didn't call for attacking Iran, or Pakistan, or for sending more troops to Afghanistan. She didn't make promises to go get Osama "in the cave where he lives". She is also for education, but not in a "laid off workers should educated themselves" kind of way. She calls for free education for all, including college education for qualified applicants. She sure isn't mainstream enough for Americans to vote for! We have to have bluster, and empty promises, or the candidate is not considered viable.
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Thursday, September 4, 2008

Chelsea is a Dog. Bristol is Off-Limits

My mom reminded me that the Republicans in the 90s, including Republican Presidential candidate, John McCain, amused their bullying fans by ridiculing Chelsea Clinton's looks. Rush Limbaugh and the other grown-up frat boy jocks were cruel enough to try to attack their political opponent by demolishing his daughter's teenaged self-esteem.

Everyone should know how fragile a teenagers ego is. It is truly beneath contempt for an adult to belittle someone's child for entertainment or political gain.

But the media which allowed without comment the pile-up on Chelsea, is sternly announcing that commenting on Bristol is off-limits. Now we're going to have some sensitivity, when it's a Republican teenager. And, of course, no one was attacking Bristol, just her mother's politics and religion, as illustrated by the results.

My mom told me that the Republicans did the same thing to Margaret Truman in the 1940s, as they did to Chelsea in the 90s. What is it with Republicans? Do you have to be a jerk to join the Party?

And what kind of a mother would hug and praise the monster that attacked her child so cruelly? Hillary betrayed her only child when she kissed up to McCain. And for what? She got dumped for Brzezinski's buddy Barack, and mothers throughout Afghanistan, Pakistan, Iran and Russia will be crying for their children when those boys are through.

Although, really, insulting someone's child is nothing compared to kidnapping and holding hostage pre-teen children to force their father to comply.
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Tuesday, September 2, 2008

The Personal is Political

High-minded progressives are supposed to ignore Palin's 17 y.o. knocked-up daughter, and the implications for the country and the world of Palin's politics. How polite.

Sorry. It may be rude, but I consider it important to point out that if a crazy right-wing fundamentalist Christian can't convince her daughter to keep her legs closed, no one can. As witnessed by the other right-wingers at the GOP convention, preaching abstinence only to your children frequently leads to teen-aged pregnancies. The biggest reaction to the news that the kid is pregnant is - yeah, we had that happen also!

Then they announce that their daughter will marry the father. Hello, the shotgun marriage is supposed to take effect soon enough to fake that the baby is premature! Calling the baby's daddy "my fiance" until the child is in kindergarten is a hallmark of the lumpen proletariat. Surely a future President shouldn't allow such conduct in her family, since she's holding it up as a model of ideal family values.

I couldn't care less how many babies they pump out, or who does the pumping. I care about the rest of us having the choice of whether or not to reproduce, and if we choose to reproduce, how many. I care about the poor in America and around the world having the same choices as the rich. I care about children being taught about sex in a scientific, not Christian moralizing, way. I want children to have information and access to birth control and abortion.

This is why the pregnancy of Sarah Palin's teenager should be on the table for discussion. Her personal problem is a political problem for us all.

And I loved this comment.
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