mediapro

CNBC's Specious Reporting on the Housing Plan

Those who like Santelli's, Cabrera's, and that stupid guy with the glasses that looks like an overweight chicken (what's his name?) all subscribe to the dangerous Chicago School and Uncle Miltie Friedman's failed supply side gambit that we have been playing for the past thirty years.

Remember the Laffer Curve?

It claimed that if income tax rates were cut, investment and production would be so stimulated that a fall in tax rates would increase tax revenue and balance the budget. When the budget was most emphatically not balanced, and deficits instead got worse, the supply-siders threw Laffer overboard as the scapegoat, claiming that Laffer was an extremist, and the only propounder of his famous curve.

If your memory is fuzzy on the path we've travelled since 1980, let me remind you:

Flash back to the neo-con's answer to 1970's stagflation and Milton Friedman's Shock Economics Theory he plied so well in South America for right wing fascists.

Roll tape a bit forward to the Gipper. Cut taxes, spend on defense out the wazoo, run record deficits, de-regulate markets and watch Uncle Milties' magic work.

While every right wing neo-con tape loop is buzzing with out-of-control GSEs, we all seem to conveniently ignore how all of this silly and frightening theoretical economic approach played out around the world through the likes of the IMF, World Bank, Halliburton, and their ilk.

Look at any country where this supply-side, trickle down, deregulated gambit has played and look at how eeiry is the similarity between those countries and this one:

1. The top 1% control 40% of all financial wealth in the U.S. The top 20% another 52%, leaving the rest of us (80%) America's financial wealth at a whopping 8%.

2. In terms of inherited wealth only 1.6% inherit more than $100,000. 91.9% receive nothing. Yet the "death tax" was/is the highest priority on the ultra-conservative agenda.

Now for some sobering reminders:

Under Clinton we enjoyed a $287 Billion SURPLUS that's now an ever-growing DEFICIT that at last peek was nearing $1.4 Trillion and national debt that has grown from $5.7 Trillion to $10.2 Trillion in just seven years.

Under Reagan the deficit increased to, at that time, a whopping $200 Billion from $50 Billion under Carter.

It wasn't because Clinton was an economic genious. He simply returned out-of-control revenue reduction (tax cuts) back to the Reagan rates and chose folks who shared his philosophy of government and its role. I'll put my money in the hands of the guys that believe that it's the government's job to invest in the 80% of us that need practical ways to grow our own wealth (smart energy policy, infrastructure development, education).

As for the free market to right the ship by itself "over time", I have a few tickets on the Good Ship Lollipop for those knuckle dragging leftovers that can't seem to get it through their heads that they lost the last two national elections trying to teeter on the same tired platform that got us into this mess.

The Stimulus Bill: Did the Government Break Our Leg and Offer Us a Crutch?

I agree that the author overall provides a decent analysis and some hard-to-stomach solutions. Though I disagree with the need for a fully balanced budget, I wish that the author had run through the economic thought that got us into this mess. That would have supplied some direction towards what needs to be changed. My two cents:

Flash back to the neo-con's answer to 1970's stagflation and Milton Friedman's Shock Economics Theory he plied so well in South America for right wing fascists.

Roll tape a bit forward to the Gipper. Cut taxes, spend on defense out the wazoo, run record deficits, de-regulate markets and watch Uncle Milties' magic work.

While every right wing neo-con tape loop is buzzing with out-of-control GSEs, we all seem to conveniently ignore how all of this silly and frightening theoretical economic approach played out around the world through the likes of the IMF, World Bank, Halliburton, and their ilk.

Look at any country where this supply-side, trickle down, deregulated gambit has played and look at how eeiry is the similarity between those countries and this one:

1. The top 1% control 40% of all financial wealth in the U.S. The top 20% another 52%, leaving the rest of us (80%) America's financial wealth at a whopping 8%.

2. In terms of inherited wealth only 1.6% inherit more than $100,000. 91.9% receive nothing. Yet the "death tax" was/is the highest priority on the ultra-conservative agenda.

Now for some sobering reminders:

Under Clinton we enjoyed a $287 Billion SURPLUS that's now an ever-growing DEFICIT that at last peek was nearing $1.4 Trillion and national debt that has grown from $5.7 Trillion to $10.2 Trillion in just seven years.

It wasn't because Clinton was an economic genious. He simply returned out-of-control revenue reduction (tax cuts) back to the Reagan rates and chose folks who shared his philosophy of government and its role. I'll put my money in the hands of the guys that believe that it's the government's job to invest in the 80% of us that need practical ways to grow our own wealth (smart energy policy, infrastructure development, education).


On Feb 09 02:00 PM Thomas J. Gordon wrote:

> kelm,
> good comments. write an article. tell us what your thoughts are
> about responsible financial regulation.
> insiderman, Concerning the Bush deficits. I have come to the conclusion
> that very few people vote for people who balance budgets. This leaves
> the Republicans in a position of being the constant and nagging naysayer
> if they insist on balanced budgets. I think this is what is really
> behind the famous Cheney comment that "deficits don't matter". Until
> something really bad happens that people can directly associate with
> deficits, deficits aren't something a politician gets rewarded for
> by paying attention to them.

Fannie and Freddie Did Not Cause This Crisis

I thought this was a financial discussion website.

Cybercorrespondent should keep his creepy (I won't even disgrace the word political) comments buried in the deep recesses of his troubled mind.

Fannie and Freddie Did Not Cause This Crisis

Ay, ya, yai!

Just look at all the swinging gates in this post. How can I be right when everybody's wrong?

To pin this mess on any one party or any one thing is foolish. But we can look at one key entry event that facilitated the whore mongers.

The Mess in fact did start with the 1999 repeal of a depression-era law (Glass-Steagall) that served to keep a check on commercial lending and re-packaging financial products into incomprehnsible paper that was constantly re-sold. Sound familiar?

If we want to pin the blame, McCain chief financial advisor, Phil Gramm, literally inserted in the middle of the night the key provision that allowed the financial industry waters to be muddied with no distinctions between insurance, banking and investing.

Do you really believe the lie that Fannie and Freddie CAUSED this crisis? If you really want to look at who was repackaging the clean mortgage paper into CSE's look no further than the same investment company that was the key reason for the passage of Glass-Steagall -- JP Morgan and the rest of the Investment Banking community. They were doing exactly the same thing they did in 1932 -- re-packaging debt into complex instruments and re-selling.

Though I agree with the premise of this article, there's enough blame to go around. This FIX does not solve the problem until we look at how the accounting rules, lax regulation and religious devotion to unfettered capitalism got us into this mess.

My one regret about the structure of the fix, as far as I can tell, is that the taxpayer still has no real skin in the game. Let's just look at this logically: If Warren Buffet offered to invest his entire wealth to help solve this problem by purchasing paper of unknown real value, do you think that he would exact majority control over the business operations of these companies in which he is literally investing?

We are simply left with the hope that someday about twenty years down the road, most of the honest borrowers will adhere to their debt obligations.

For now, the bankers get their money up front, and it's business as usual.

How Much Are Fannie and Freddie to Blame?

Ay, ya, yai!

Just look at all the swinging gates in this post. How can I be right when everybody's wrong?

To pin this mess on any one party or any one thing is foolish. But we can look at one key event that facilitated the whore mongers. The Mess in fact did start with the 1999 repeal of a depression-era law (Glass-Steagall) that served to keep a check on commercial lending and re-packaging financial products into incomprehnsible paper that was constantly re-sold. Sound familiar? If we want to pin the blame, McCain chief financial advisor, Phil Gramm, literally inserted in the middle of the night the key provision that allowed the financial industry waters to be muddied with no distinctions between insurance, banking and investing.

Do you really believe the lie that Fannie and Freddie CAUSED this crisis? If you really want to look at who was repackaging the clean mortgage paper into CSE's look no further than the same investment company that was the key reason for the passage of Glass-Steagall -- JP Morgan and the rest of the Investment Banking community. They were doing exactly the same thing they did in 1932 -- re-packaging debt into complex instruments and re-selling.

Though I agree with the premise of this article, there's enough blame to go around. This FIX does not solve the problem until we look at how the accounting rules, lax regulation and religious devotion to unfettered capitalism got us into this mess.

My one regret about the structure of the fix, as far as I can tell, is that the taxpayer still has no skin in the game. Let's just look at this logically: If Warren Buffet offered to invest his entire wealth to help solve this problem by purchasing paper of unknown real value, do you thin that he would exact majority control over the business operations of these companies in which he is literally investing?

We are simply left with the hope that someday about twenty years down the road, most of the honest borrowers will adhere to their debt obligations.

For now, the bankers get their money up front, and it's business as usual.

How Much Are Fannie and Freddie to Blame?

Read Naomi Klein's "The Shock Doctrine" for the clearest explanation of The Mess.

For all you Milton Friedman addicts, der Fuhrer has been stripped of his clothing.