Thursday, March 26, 2009
Republicans and their cheerleaders are incapable of ever telling the truth.
Now, having said that, the Obama administration's record of rolling back those same Bush power grabs is spotty at best, embarrasingly inadequate at some points, and at worst still completely unethical, if not qualifying as outright unjustifiable homicide.
We still have a hell of a long way to go to recover -- economically, ethically, legally, militarily, and diplomatically.
Bachmann is jumping on a claim yesterday by Tim Geithner, who temporarily seemed to suggest yesterday that he’s open to a Chinese proposal to replace the dollar as the global currency, before walking it back. She blasted out a release demanding that Obama come clean about his intentions and say whether he agrees with Geithner:Not only does the woman herself fail the apparently rigorous intellectual qualifications to successfully operate a pair of safety scissors, most of her staff should be immediately fired for the cardinal political sin of not preventing her constituents from having their reasonable suspicions about Bachmann's qualifications to legislate anything instantly transformed into the ghastly realization that she actually is that ignorant.
Bachmann Demands Truth: Will Obama Administration Abandon Dollar for a Multi-National Currency?
The thing is, though, is that Geithner has already clarified that he doesn’t foresee a change in the dollar’s centrality. And Obama himself flatly declared that he’s not open to such a change at his presser the other night.
Undeterred, Bachmann has even “introduced a resolution that would bar the dollar from being replaced by any foreign currency,” as her release puts it.
It appears Bachmann may have thought that Geithner was talking about being open to a change in U.S. currency, rather than the world’s reserve currency, which is what the China proposal was about. And as Matthew Yglesias notes, foreign countries partake in decisions about the world reserve currency.
So is Bachmann proposing legislation that would ban foreign countries from doing this? Can Congress really legislate the behavior of foreign countries?Nobody except the stupidest politician in Congress (which is like saying the hottest section of the sun or the wettest part of the ocean, I know).
No, it turns out. I checked in with Bachmann’s spokesperson, Debbee Keller, who reassures that this is only about American currency.
“She’s talking about the United States,” Keller said. “This legislation would ensure that the U.S. dollar remain the currency of the United States.” Of course, no one had been discussing any change in U.S. currency in the first place….
Take comfort in the fact that you are smarter than she is. All of you.
Go on. Guess.
(TAXEN CUTTEN UBER ALLES!)
Under the Republican plan, the top marginal tax rate would be slashed from 35 to 25 percent, facilitating a dramatic transfer of wealth up the economic scale. Anyone making more than a $100,000 would pay the top rate; those under would pay 10 percent.Yeah, that'll fix the deficit. The presser went like this:
"Are you going to have any further details on this today?" the first asked.The new Republican Party motto: Tax Cuts And Magical Thinking.
"On what?" asked Boehner.
"There's no detail in here," noted the reporter.
Answered Boehner: "This is a blueprint for where we're going. Are you asking about some other document?"
A second reporter followed up: "What about some numbers? What about the out-year deficit? What about balancing the budget? How are you going to do it?"
"We'll have the alternative budget details next week," promised Boehner. Minority Whip Eric Cantor (R-Va.) had wisely departed the room after offering his opening remarks. ("Today's Republican road-to-recovery is the latest in a series of GOP initiatives, solutions and plans," he had offered.)
A third reporter asked Boehner about the Republican goal for deficit reduction, noting President Obama aimed to cut it in half in five years. "What's your goal?"
"To do better," said Boehner.
"How? How much?"
"You'll see next week."
"Wait. Why not today? Because he asked you to present a budget."
"Now, hold on," said Boehner. "The president came to Capitol Hill and laid out his blueprint for his budget during the State of the Union. He didn't offer his details until days later."
"In general, where do you see cuts coming?" the Huffington Post asked.
"We'll wait and see next week," he said.
And people wonder why nobody takes these goons seriously anymore. Honestly, if you assume the rest of their budget is a spending freeze on everything but Pentagon spending, jack up Pentagon spending by 10%, and then add in this massive tax cut for the rich, you pretty much have to assume we're looking at what, doubling that $1.3 trillion deficit Bush gave to Obama?
So of course to make up for that tax cut, the GOP budget would have to either completely wreck the dollar and triple our national debt in ten years or on the other hand basically destroy every social program in the country during a huge recession, either way decimating America's economy.
Somebody needs to remind John Boehner that he is utterly irrelevant.
[UPDATE] Iggy discovers that the real problem with the GOP "budget" is the fascist European socialist central planning policies it contains. More deficit spending than Obama, more government control over the economy than Obama: the GOP playbook of "accuse your opponent of doing something unspeakably horrible and then make sure you're doing it doubly so" hasn't changed from the Rove days.
If everyone can find this much to bitch about over seven lousy questions, then it's not worth it. Leave the Village stupidity to the Villagers.
The proposed FASB rule, according to a release from the agency, "provides a framework for measuring fair value and a definition of fair value that contemplates an orderly transaction between market participants, not a forced or distressed sale."Once again we're asking for the ability to seize insolvent banks with one hand, and then denying ourselves the ability to determine the true financial status of the banks with the other.
It goes on: "In the current economic crisis, many constituents have requested additional authoritative guidance to assist them in determining whether a market is active or inactive, and whether a transaction is distressed. Proposed FSP FAS 157-e would provide this application guidance."
In other words, if a bank asserts that the market for a certain asset is "inactive," then it need not write the value of it down to market prices. Critics such as Grayson insist this change would allow banks to continue a fiction of viability when in fact they may be insolvent.
"I think the real reason this has come up now is because a lot of the institutions are genuinely insolvent and don't want to admit it," Grayson said.
Great. The banks of course will say that nearly all toxic assets are in inactive markets. Thus, all the assets are worth 100% of what the banks say they should be. So, now the Obama administration can say "Well, we can seize these banks, but as you can see here the banks say they are all solvent." These supposedly solvent banks will then get to participate in the Geithner Plan and get free money by selling these assets at the prices the banks want to sell them at to the American taxpayer.
Then we get stuck with billions of dollars spent on something really worth 20 cents on the dollar.
It's maddening, and yet there's nothing we can really DO about it.
“To address this will require comprehensive reform,” Geithner said in prepared testimony for a House Financial Services Committee hearing. “Not modest repairs at the margin, but new rules of the game,”I know just the guy he should hire for the role of Systemic Risk Regulator too, and he even likes Tim's plan, he just knows Plan N will have to come afterwards.
Geithner called today for a systemic risk regulator to oversee big financial institutions and federal authority to seize them if they run into trouble.
The administration’s regulatory framework would make it mandatory for large hedge funds, private-equity firms and venture-capital funds to register with the Securities and Exchange Commission, and it would require derivatives to be traded through central clearinghouses.
The SEC would be able to refer those firms to the systemic regulator, which could order them to raise capital or curtail borrowing.
Hopefully this is the start of the real work on the economy. All of these are badly needed oversight reforms that will have to be used to fix the problem.
Separately, the number of workers collecting state unemployment benefits rose to a record 5.56 million earlier this month, while new claims rose to 652,000 in the week ended March 21, the Labor Department said.Analysts polled by Reuters had expected continued claims to total about 5.48 million during the week ended March 14, the most recent data available. The number of new claims for the week of March 21 had been forecast at 650,000.But here's the killer number for the economy:
Private business inventories were revised to show a $25.8 billion decline, previously reported as a $19.9 billion fall, as business responded to the slump in demand by cutting output.That's a massive contraction in the business sector. Not the manufacturing sector or the service sector, the whole freakin' business sector.
Business investment, which is typically made when companies are planning production increases, fell at a 21.7 percent rate, the biggest fall since the first quarter of 1975, from a previously estimated 21.1 percent contraction. Residential investment fell 22.8 percent in the fourth quarter.
Just gonna get worse.
As more and more states and counties see falling home prices, growing foreclosures, empty shopping malls and unused office space, these locations will get less tax revenue, leading to difficult choices: either cuts in services, raising taxes, or both.
Like a dozen or so other cities across the nation, Fresno is dealing with an unhappy déjà vu: the arrival of modern-day Hoovervilles, illegal encampments of homeless people that are reminiscent, on a far smaller scale, of Depression-era shantytowns. At his news conference on Tuesday night, President Obama was asked directly about the tent cities and responded by saying that it was “not acceptable for children and families to be without a roof over their heads in a country as wealthy as ours.”
While encampments and street living have always been a part of the landscape in big cities like Los Angeles and New York, these new tent cities have taken root — or grown from smaller enclaves of the homeless as more people lose jobs and housing — in such disparate places as Nashville, Olympia, Wash., and St. Petersburg, Fla.
In Seattle, homeless residents in the city’s 100-person encampment call it Nickelsville, an unflattering reference to the mayor, Greg Nickels. A tent city in Sacramento prompted Gov. Arnold Schwarzenegger to announce a plan Wednesday to shift the entire 125-person encampment to a nearby fairground. That came after a recent visit by “The Oprah Winfrey Show” set off such a news media stampede that some fed-up homeless people complained of overexposure and said they just wanted to be left alone.
The problem in Fresno is different in that it is both chronic and largely outside the national limelight. Homelessness here has long been fed by the ups and downs in seasonal and subsistence jobs in agriculture, but now the recession has cast a wider net and drawn in hundreds of the newly homeless — from hitchhikers to truck drivers to electricians.
“These are able-bodied folks that did day labor, at minimum wage or better, who were previously able to house themselves based on their income,” said Michael Stoops, the executive director of the National Coalition for the Homeless, an advocacy group based in Washington.
The surging number of homeless people in Fresno, a city of 500,000 people, has been a surprise. City officials say they have three major encampments near downtown and smaller settlements along two highways. All told, as many 2,000 people are homeless here, according to Gregory Barfield, the city’s homeless prevention and policy manager, who said that drug use, prostitution and violence were all too common in the encampments.“That’s all part of that underground economy,” Mr. Barfield said. “It’s what happens when a person is trying to survive.”
You're going to see a lot more of these Hoovervilles spring up around the country over the next few years. Should Helicopter Ben's zero-interest rate policy, Timmy's bailouts and regulations, and Obama's budget fail to get the economy Bush wrecked going again, you're going to see them in your city or town.
You may see them anyway. Recovery will be a very long time coming. The happy face media says we've turned an economic corner and that we've hit bottom and are on the way back up now. Roubini says the bottom is still on the way.
U.S. stocks will fall and the government will nationalize more banks as the economy contracts through the end of 2009, said Nouriel Roubini, the New York University professor who predicted last year’s economic crisis.Given the track records of the last two years, I'd listen to Roubini. He's been right across the board since 2004.
“The stock market is a bit ahead of the real macroeconomic and financial news,” Roubini, a professor at NYU’s Stern School of Business and the chairman of consulting firm Roubini Global Economics, said in an interview with Bloomberg Television in London today. “We’ll have some major banks going belly up that will need to be taken over.”
We got a long way to go to daylight, folks.
- Tim Geithner takes his proposed new financial regulations to Capitol Hill today.
- It's the 4,800 calorie Fifth Third Burger as the ultimate ballpark "snack" in Michigan.
- The DEA's new surveillance planes are a total bust, costing taxpayers millions.
- Could an oil shock late this year sink any recovery effort?
- Canada rallies a premptive attack on the Conficker.C computer worm due April 1.