Stop the Madness: No More Bailouts!

In the few short weeks since Congress passed the $700 billion bailout bill we have watched helplessly as our tax money was diverted to everything but its intended use which was to save CRITICAL institutions from bankruptcy. We witnessed recipients take billions of dollars of bailout money to fund six figure executive vacations, line executive pockets with billions in bonuses and purchase other businesses with funds that were intended to reduce the red ink in their accounts. We, then, learned that, instead of buying up "troubled assets" from these institutions as promised, the government decided merely to purchase stock in the troubled institutions because, according to Treasury Secretary Henry Paulson, the original plan was "too difficult" to execute. He, then, addressed the country and told us that he was unilaterally changing the strategy, arrogantly stating, "I make no apologies..." for the change.

As soon as the election was over, House Speaker, Nancy Pelosi, and colleagues met and promised bailout money for everyone. And her words did not go unnoticed. Every group from realtors to credit card companies to the Big Three automakers began lining up for a piece of the action. President-Elect Barack Obama, showing a total lack of understanding of the economic effects of his plan, stated that the economic bailout would trump the budget deficit. In a recent "60 Minutes" television interview he stated the following:

The consensus is this, that we have to do whatever it takes to get this economy moving again, that we have to -- we're going to have to spend money now to stimulate the economy. And that we shouldn't worry about the deficit next year or even the year after; that short term, the most important thing is that we avoid a deepening recession.

Well, folks, there are potentially disastrous consequences to this plan that will, actually, DEEPEN THE RECESSION. First, our economy cannot handle the debt this bailout will cause. What was to be a $700 billion bailout has already become well over a TRILLION DOLLARS in a matter of weeks! And there is no end in sight. We are looking at, literally, TRILLIONS more dollars before this crisis is over! Once we start this process, we will have to continue bailing out companies when they ask for more because, then, we CAN'T allow them to fail. AIG has already petitioned the government for more bailout money because the funds they received did not do the trick. And, now, the Big Three Automakers are petitioning the government for another $50 billion! They already quietly received $25 billion the same day the $700 billion bailout package was approved and burned through it. This money was IN ADDITION to the $700 billion in the bailout package. And, as they sat before Congress with their request, they implied they would need more bailout money later on.

So what is the danger in providing trillions of dollars in a bailout? It will, very simply, bankrupt the government, leading to a TOTAL ECONOMIC COLLAPSE. Since we don't have that kind of money, the government will have to PRINT more. That will lead to RUNAWAY INFLATION and a WORTHLESS DOLLAR. How would you like to spend $50 or $100 for a cup of coffee? Sounds impossible, doesn't it. Well, in early October, the country of Iceland experienced a TOTAL ECONOMIC COLLAPSE. It CAN happen here!

The second dangerous consequence of a bailout is that it rewards incompetence and discourages businesses from instituting difficult cost-cutting measures and developing competitive new strategies. They remain fat, inefficient and void of initiative, expecting the government to continue to support and keep them going. This method has been tried and failed miserably in Europe. When a government supports businesses they lose the incentive to improve. FREE ENTERPRISE, the concept on which this country was built, demands that businesses stay competitive or be replaced by those that are.

The US Auto Industry is a perfect case in point. In 1979 Detroit owned the world. At that time, anywhere in the world you went, virtually all the automobiles on the street were made by the Big Three. The Big Three began to get fat. Chrysler developed financial problems and faced bankruptcy. Lee Iacocca secured $1.2 billion in loan guarantees from the Federal Government which saved Chrysler. Today, it turns out that was not a favor. Had Iacocca not secured those guarantees Chrysler would have had to reorganize and would have emerged much leaner and able to compete in the world market. Instead, it remained fat and began producing inferior cars in order to remain profitable. In order to compete with Chrysler, Ford and GM, which had also become fat, followed Chrysler's lead. Their production of expensive, inferior cars gave foreign auto manufacturers entrance into a world automobile market previously exclusively owned by Detroit. The rest is history. Today, as we know, the best cars are not produced in the US. Instead, Toyota, Honda, BMW and others have taken over the world market, and the Big Three have been struggling ever since. This crisis was NOT caused by the current financial meltdown. The Big Three have been slowly going out of business for the past 30 years! This week their CEOs traveled to Congress, asking for billions of dollars to support them with no plan to improve, cut back compensation or become more competitive. Despite their plight, their executives reward themselves with huge compensations (salaries and bonuses), fly on fleets of corporate jets, pay their employees $75 per hour and give them up to four years pay after a plant is shut down. If we bail out the Big Three now, they will be back in a few months with their hands out again. And behind them will be every other industry that has lost its ability to compete. There is no end to this kind of program!

So what is the answer? We need to let businesses (and people) sink or swim on their own. The Federal Government cannot not be the parent that bails out fat, inefficient industries or individuals that have lived far beyond their means. Industries and people must take responsibility for their own financial survival. Bankruptcy does not mean a company will go out of business. Most likely it will result in debt relief, restructuring and cost-cutting under the supervision of a bankruptcy court. The result will be a more viable company that is much better able to compete in the world market. Unlike the recent restructuring at UAL, to be fair, the bankruptcy judge must ensure that executives and management share in the cost-cutting and don't reap windfall profits while the rest of the company sacrifices to ensure the company's survival. And individuals who spend beyond their means must follow the same path and become responsible for their actions. Filing for bankruptcy will provide debt relief as they tighten up and learn to live within their means as the vast majority of Americans do.

There is no painless way out of this financial crisis. Let's not precipitate total economic failure by instituting measures that fool us into thinking there is. If we do not change our course, the consequences for this country and everyone in it will be disastrous. In the long run, a return to FREE ENTERPRISE will, both, save and create jobs as most businesses will survive and, then, become more competitive.

Veterans Day Tribute

Tomorrow, it is fitting we remember and honor those who served, fought and died to preserve the great American experiment and the freedom we enjoy, today. Take a moment to thank those that served and those who are serving, today. We owe them so much.

Click the link, below, for a moving tribute to the Vietnam Vets. The message is universal for all who served.

Tribute to Veterans

[My thanks to Linda Klink for forwarding me this video]

The Wizard of Washington

I think it's safe to say we all need a break from the stress of the election and the seriousness of the time. It's certainly not over, but a humorous take on these subjects can help. Below is a video that should give everyone a break and a few chuckles, too.

[My thanks to Phil Upman for forwarding this video]

First Glimpse of an Obama Administration

In my last article I stated that, although I had serious concerns, I hoped we would come together as Americans and that an Obama administration would rise above partisanism, move to the center and soften its socialist economic philosophy. Now, three days after the election, we are getting our first glimpses of what an Obama presidency will be like, and my optimism is fading fast.

I find Mr. Obama's selection of Congressman Rahm Emanuel as Whitehouse Chief of Staff very disturbing. Congressman Emanuel is one of the most notoriously combative and partisan members of the Congress. His choice as Chief of Staff in the new cabinet clearly calls into question statements made by the President-Elect in his victory speech just days ago when he said he wanted to rise above the immaturity of partisan politics. Americans are sick and tired of sending representatives to Congress to play a partisan chess game instead of caring for the nation and representing the people that elected them. If this first cabinet choice is an indication of things to come, we should be very concerned. James Carney said this in an article published today in Time Magazine about Congressman Emanuel:

Not everyone in Congress, or in Washington, particularly likes Emanuel, 49, the former senior Clinton White House official who just won his fourth term in Congress representing a portion of Chicago and who serves as the fourth-ranking Democrat in the House. Even some members of his own party (including members of the black and Latino caucuses) bear no affection for him, especially those who feel he has run roughshod over their prerogatives in pursuit of some greater goal — like wresting control of the House from the Republicans in 2006, a project Emanuel spearheaded. Others simply fear him.

Now it turns out that the money from the $700 billion bailout package did not go to the banks with government oversight as promised. The Fed merely purchased shares of the affected banks’ stocks. CEOs can, now, use these funds any way they want. They have already used some of these funds to purchase other banks; not an intended use for money allocated to reduce the red on their balance sheets. Another probable use will be to pay their legal defense costs when they are prosecuted for the wrongdoing that led to the financial meltdown. So the government and, therefore, the taxpayer, will be footing the bill to defend the criminals that got us into this mess using the $700 billion we entrusted to the government solely to fix the meltdown. Allegedly, the government FORCED Bank of America to take bailout funds when they didn’t even want them! And, now, everyone is in line asking for a handout, from the auto industry to the credit card companies to the realtors and construction industry.

At a meeting, yesterday, House Speaker Nancy Pelosi and a, now, unbridled democratic Congress were already promising bailouts for everyone. They were calling for an additional $300 billion bailout package on top of the current $700 billion package and $25 billion more for the auto industry which already quietly received a $25 billion bailout the same day the $700 billion bailout package was approved. Where does it end?

This country is going bankrupt! While those that caused this mess (greedy bankers, poorly run corporations and people that overspent on mortgages and credit cards) will now get TRILLIONS of bailout dollars from the taxpayer, responsible Americans that lived within their means will inherit a partisan, socialist government with their fingers in everything from the banking and healthcare systems to the auto industry, a broken, debt-ridden economy with a worthless inflated dollar, and empty 401k's from a failed stock market. I am very concerned!

Election 2008 Epilogue

Today, as we move forward from this presidential election, it is critical that we find closure and reunite as a nation. Obsessive coverage has dominated our attention for two years, now. The anger and divisiveness it has caused among Americans must be healed. For me it is therapeutic to acknowledge and understand the many emotions that this election has left in its wake.

First, the sheer length of the campaign (two years) has been a disservice to the people of this nation. ONE BILLION DOLLARS have been raised and spent by the candidates. This is an incredible amount of money. Imagine the social programs that money could have funded. And when one candidate outspends his opponent by a 3 to 1 ratio it gives him a huge unfair advantage. Some method must be devised that levels the playing field with regard to campaign spending. Further, the American people do not need two years of the divisiveness and anger that presidential campaigns create. I believe future presidential campaigns should be limited to one year. I think Congress should enact legislation to accomplish these objectives.

The next issue on my mind is the media. In my opinion, the news media failed the American people during this election. Along with the first amendment that guarantees us free speech and freedom of the press comes a huge responsibility. That responsibility is to provide the American people with RESPONSIBLE, UNBIASED reporting. The media have enormous power to mold the opinions of the people. Why do you think so many countries and dictatorships around the world control their media? If you control the media, you control the hearts and minds of your people. Hitler did it. The Soviet Union did it. Iran does it now. In the past, Americans were able to get unbiased reporting from the newspapers and the nightly news. During this campaign, however, the media overwhelmingly set out to mold the minds of the people in order to elect the candidate of THEIR choice. Of course the media have the right and the obligation to provide the people with commentary and editorials. But they need to label them as such. They did it in the past. Did anyone ever know Walter Cronkite's political leanings? I don't think so. How many of today's news anchors can you say that about? This year I found myself switching from conservative to liberal stations and newspapers in an attempt to get the true stories. Then I had to separate objective information from slanted. Thousands of Americans do not have the time or education to do that. Election outcomes should not be determined by the media. The people deserve better.

My third issue is campaign tactics. Each election the candidates and their parties let the American people down. Although they promise to stay on issues and not resort to smearing, they always do. The smear tactics and personal ridicule used against Governor Sarah Palin during this campaign, for example, reached a new low in presidential politics. Senators Obama and Biden, the Democratic Party and the media launched a personal smear campaign the likes of which I have never seen. I have no problem with them attacking a person's record or policies, but a hysteria campaign of this nature is just plain wrong. And both sides resorted to negative campaigning in the end. In addition, neither campaign laid out specific ideas and plans for their platforms. They continued the use of generality propaganda. How are we to decide which candidate has the better plan if they don't show them to us? I believe a contributing factor to Senator McCain's defeat was his failure to get the word out regarding the cause of the financial meltdown and why we went to war in Iraq (see my articles on the financial meltdown and why we went to war). That brings me to the subject of our outgoing president, George W. Bush.

The bashing of President Bush by both candidates has been grossly unfair. In my opinion, George W. Bush has been the most undermined president in the history of our nation. For partisan political gain, the Bush administration has been undermined since the last presidential election when Senator John Kerry began undermining efforts of the president and eroding the unity of the people while this nation was at war. And since that time, the Democrats, with the aid of the media, have undermined everything the Bush Whitehouse attempted to do, from the War on Terror to the reforming of Social Security, which everyone knows is bankrupt and in dire need of reform (again, read my articles on the financial meltdown and why we went to war).

The election is over, now. What's next? On January 20th, Barack Obama will take the reins as President. He will have an overwhelmingly democratic Congress behind him, resulting in nearly unbridled power. I remain seriously concerned about the same issues that concerned me during the election: Mr. Obama is one of the most far left members of the Senate with no history of bipartisan spirit, a man who wanted to pull our troops out of Iraq regardless of the consequences, who was against the surge and still won't admit it worked, who wants to cut military spending while we are at war, who voted to withhold funds for our troops at war, who does not understand how to deal with rogue nations and leaders that want to do us harm, who will redistribute wealth from some and give it to others who don't even pay taxes, who wants to increase corporate and capital gains taxes, who wants government run healthcare, and whose policies will abandon the principles of free enterprise that made this nation in favor of the socialist principles that have already failed in Europe and will cost the American taxpayer trillions of dollars.

In retrospect, now that Senator McCain has lost the election, I believe it may have been a blessing in disguise. You see, had John McCain won the election, he would have presided over an overwhelmingy democratic Congress that would have opposed and undermined every move and initiative he made, just as it has done with President Bush. Senator McCain would have had no chance of instituting any of the programs and changes he put before the Congress. He and his administration would have been blamed for the actions of the democratic Congress, just as George W. Bush has been blamed for the actions of the current democratic Congress. Now, whatever course our country takes over the next four years, the Democrats will have to take responsibility. I only hope that President-Elect Obama and his administration moderate some of their extreme left-wing, socialist principles when they take office.

I leave you with my final thoughts. The long campaign is over. It has angered and divided the American people. You have read my concerns and frustrations. I have serious concerns about our future. Our ability to objectively vote and determine who the leaders of our country will be is in serious question. Despite these issues we, now, need to put our differences aside, come together as Americans and fix what's broken. We have no other choice.