Tim Geithner and Chris Dodd should either resign or be removed.

So much for the new age of transparency and change and while I am not going to blame Obama for this AIG mess – it’s happening on his watch and he is the big boss.

It has now become rather clear that Geithner and Dodd who once claimed they knew nothing about AIG bonus payouts are coming clean. Looks like Dodd’s amendment in the massive 787 billion stimulus bill contained language that opened the door for these bonuses to be paid out and since Geithner is writing the check he is responsible.

Dodd’s language specifically protected contracts before a certain date and it seems incredibly ironic and might I say stupid that a bill was passed today to tax the living hell out of these very same bonuses they allowed in the first place!

The entire concept of taxing 90% of these bonuses is ludicrous at it’s face and today they passed legislation that is allowing just that. While AIG’s executives most certainly do NOT deserve bonuses and frankly should be ashamed for taking money after sinking an entire company, letting our congress impose such harsh restrictions on ANY company receiving bonuses is a slippery slope at best.

First, there is always a constitutional matter, can congress really hone in on a specific group (in this case, executives of bailout companies) and levy special taxes on this little group? Secondly, what will happen to these companies if the incentives are now all sapped? Executives and other talented people will simply leave these institutions and what once used to be massive corporations will become government owned shells mired in corruption and waste.

Obviously the situation has become extremely messy, scary and frustrating. Still, in order to revitalize some semblance of public trust, the specific individuals that allowed these bonuses to be paid out and whose action caused the bill of taxing bonuses 90% to be passed – MUST RESIGN!

Do Red states get more funding than blue states?

The answer to this question on liberal websites is considered common knowledge; of course Red states get more federal aid and of course blue states fund the rest of America. Let’s look at the stimulus package and where the money is going to see if this piece of gospel lives up to it’s expectations. I am using this breakdown, downloadable here (state by state from Center on Budget and Policy Priorities);

The stimulus bill allocates $39.5 Billion for education and $8.8 billion for other services. There is also apparently another $5 billion for incentive grants, but this particular sum is not broken down yet. So we will use the $48.3 billion figure. All in all, these funds will be used to fund everything the states require including paying out all non-federal aid.

Some of the biggest recipients of funding are as follows:
(First number is from the education block grant, second number is the all purpose block grant)
Note: Blue States and Red States are being defined by how each state voted in 2008.

Blue States:
California $4,875.5 $1,084.8
Florida $2,208.8 $491.5
Illinois $1,681.1 $374.0
Massachusetts $813.3 $181.0
Michigan $1,302.4 $289.8
New Jersey $1,088.3 $242.1
New York $2,468.6 $549.2
North Carolina $1,161.9 $258.5
Ohio $1,463.7 $325.7
Pennsylvania $1,558.8 $346.8
Washington $819.9 $182.4
Total: 19.1B + 4.3B = $23.4B

Red States:
Texas $3,250.3 $723.2
Georgia $1,260.8 $280.5
Virginia $983.9 $218.9
Indiana $823.7 $183.3
Arizona $831.9 $185.1
Total: 7.1B + 1.6B = $8.7B

This snapshot alone indicates that blue states are lined up to receive almost 3 times as much as red states. In order to avoid skewing of results due to small samples, I have compiled a spreadsheet in Excel (email me if you wish to see it) and labeled each state as either D or R and ran summation functions.

Results:

Total Democrat: 27,468.90 – 6,111.60 – Total Money: $33,580.50
Total Republican: 11,525.60 -2,564.50 – Total Money: $14,090.10

The 3:1 ratio drops to slightly more than 2:1, but the gospel spread by liberal forums and bloggers seem to be nothing more than a myth.

Recovery.gov a lame attempt at stimulus transparency

Based on a campaign promise by Obama his administration is now utilizing technology to provide bleeding edge transparency to government in ways unseen before. Even before the stimulus bill found support in Congress, one of the very first provisions in the bill spoke about Recovery.gov as a means to provide transparency to the American public. Aim here is to let the people know where exactly our hard earned money is going and even give us a chance to participate, or in this case write about emotional stories of how someone else’s money changed our lives.

Given that a bill of this size passed through Congress in truly record speed, one would expect the website to be fully functioning and full of lip smacking goodness. Instead, the user is greeted with a bar chart that breaks down the money distribution in several sections. I was intrigued by the staggering figure of 288B for ‘tax relief’ considering $400 checks to those making less than 75k and an AMT patch cannot possibly amount to this kind of cash, so I clicked to learn more.

We are greeted with a colorful display

The first realization is that 81 Billion is going to ‘Protecting the Vulnerable’. No description or details of what this means, but it is a rather whopping number considering it certainly does not apply to me or anyone I know. I actually pay my mortgage every month so I am out.

Second realization is that 144 Billion is going into an all purpose state slush fund where states swarming with illegal immigrants will be eligible for money based on their needs. Rumors suggest that California, Nevada, Florida, Arizona and Michigan will be the top recipients taxpayer goodness. In case you thought the Florida and California illegal immigrant problem was not your problem, think again!

Finally and much more painfully is the realization of what 288 Billion in tax relief truly means. This can be seen as fine text below the pretty bubbles:

“Tax Relief – includes $15 B for Infrastructure and Science, $61 B for Protecting the Vulnerable, $25 B for Education and Training and $22 B for Energy, so total funds are $126 B for Infrastructure and Science, $142 B for Protecting the Vulnerable, $78 B for Education and Training, and $65 B for Energy.”

So Imagine this, tax relief is just an all purpose label that contains moneys allocated for other sections that are separately defined in the epileptic bubble display. 15B to infrastructure and science is tax relief? Since when? How does that work? If I buy a chemistry set do I get to write that one off? What the hell!?

In other words, the website designed to provide transparency and usher in a new innovative approach in informing the public does nothing more than to shuffle money where it looks best! How else can you justify creating specific sections called Energy, Education, Helping the Vulnerable, Science and then purposely take money designed for these sections and masquerade the moneys as tax relief? Even if there are some obscure energy tax credits, specific education tax credits and more unemployment extensions – it is NOT tax relief! As I have written before, there are NO tax cuts in this bill, period. Tax relief for some of us will come in the form of 13 dollars a paycheck.

How can our government rush the most expensive bill into law, but cannot even create a website displaying the most rudimentary facts? Then again, virtually nobody in Congress read the bill so I imagine it might be difficult to create a website detailing something nobody is even familiar with. One thing is clear, money is being circulated from one class of people to another and phony websites are used to mislead the American public into complacency.

Visit Recovery.gov to learn about WHERE your money is going! There is a fun video from our president! One stop shop for your stimulus needs.

Housing crisis a war on middle class America.

We have a housing crisis in this country, but the crisis is not rising foreclosure rates and rundown neighborhoods. After all, those elements have existed before and they are a natural part of the real estate market’s ebb and flow. There is another crisis unfolding, a crisis that the media will not report and the politicians will not acknowledge. War has been declared on every single American who in the past several years did all the right things and made all the correct decisions. Somehow it has been established that those suffering the impending housing doom are victims of greedy bankers and exploitative free marketeers unleashed upon America due to ‘deregulation’. It has been estimated that those suffering foreclosures number somewhere between 4 and 6 million people. For perspective, there are as many Facebook fans of Barack Obama. The remainder 295 million Americans due to sheer cunning shrewdness and genius escaped the prying clutches of money grubbing bankers and for this cunning mischief there will be retribution.

Retribution comes in the form of aid to those in need (sometimes), paid for by the lucky 295 million. Before delving into the “stimulus” bill passed yesterday, observe two perks being distributed, two perks passed by our Congress.

First is the 7,500 tax credit to new home buyers, assuming the new house was purchased after April, 2008. At first blush, this appears to be a clever incentive to promote new home buying and perhaps stifle the surging avalanche of falling prices and foreclosures. I am just a bit bitter perhaps, because my American dream began January 2008 and therefore I am not eligible for the gracious gift bestowed to us by Congress. But despite my bitterness, I want to ask the politicians a very simple question; If you are trying to stem the flow of falling house values why are you NOT helping the people who already own the home? How is rewarding people who are arguably getting a much better deal than those who bought homes in 2007 make any logical sense? House prices peaked in 2006, fell sharply in 2007 and slid some more in 2008. Why is the tax credit not being directed to those that suffered the sharpest and most dramatic house values declines? Why reward people who are clearly in a position to buy a house anyway and if they are not in a position, then is not creating an extra incentive for people to buy homes the very reason we got into this mess in the first place? Why are responsible Americans who are struggling to get by exempt from getting a credit?

Secondly, the opportunity to refinance directed at those at the brink of foreclosure is once again a practical approach. After all, if people are able to keep their homes then it probably benefits everyone including the owners, banks and the neighborhood. Yet refinancing loans is an expensive ordeal and banks are being rescued by the TARP plan, so somebody is floating the difference – notably, you the responsible taxpayer. What is mostly bothersome though, is that an opportunity to refinance is available to those risking foreclosure and those unable to make payments. What about the rest of us who dare not miss a payment (if we care about our credit history) and were responsible? We need not apply. As a personal story, my bank misplaced a credit card payment totaling a massive $55 and without much hesitation reported this egregious violation to both Transunion and Experian. After admitting the problem (after 4 phone calls), they refunded the late charges and apologized, but informed me that the credit agencies were my own problem now and I had clear up the issues. Great, thanks for the service after 4 years of timely payments. Long story short, my credit history dropped to a reprehensible 680 and I was informed by my mortgage broker than I should wait before refinancing or suffer up to .5 point deduction! So missing mortgage payments and being on the brink of foreclosure is a path towards refinancing, but a double digit missed CC payment renders me ineligible? Why are average Americans who are merely trying to get by so vilified in this country? But my personal qualms not withstanding, according to the Comptroller of the Currency, 58% of refinanced loans fell delinquent within 6 months anyway! Danger, government at work (thanks chris_bdba).

Lastly, let us take a look at all the provisions directed toward housing in the 2009 Economy recovery act, aka New Deal part Deux, aka the Obama presidency.

Public housing capital improvements: $3,000,000,000
Public housing renovations and energy conservation investments: $1,000,000,000
Native American housing block grants: $510,000,000
Community development funding: $1,000,000,000
Emergency assistance for the redevelopment of abandoned and foreclosed homes: $2,000,000,000
Additional capital investments in low-income housing tax credit projects: $2,250,000,000
Homelessness prevention and re-housing: $1,500,000,000
Assistance to owners of properties receiving section 8 assistance: $2,000,000,000
Grants and loans for green investment in section 8 properties: $250,000,000

13.5 billion directed to section 8 housing, low-income and public housing. 13.5 billion from American taxpayers and their children going to people who most likely pay no federal taxes anyway. 2 Billion of which is going to abandoned and foreclosed homes, courtesy of the very same 4 or 6 million who failed to avoid being bamboozled by vicious bankers and predatory lending practices (not sure how the other sneak 295M got away from them). I want to avoid sounding heartless and lacking compassion, there are probably many people who truly deserve and need public housing assistance. However where are provisions for those individuals making right decisions? We don’t need a tax break? We can’t lose our jobs? We are not hurting in this recession? Yet we are asked to foot the bill for these so-called stimulative measures? This is 13.5 billion alone that have as much to do with stimulation as this entry has to do with short. If we are being asked to rescue every single American who made a tragic decision, can we not at least receive some assistance in these hard times? Instead, the “tax relief” promised by Obama penalizes anyone making more than 75,000 – which in case you are not familiar is hardly a lot of money in the East and West coasts. To add insult to injury, the package contains a modified 8,000 tax credit for new home owners and a clause that this credit need not be paid back! Once again, not existing home owners that could use it, but those that are getting a much better deal than anyone in the past 2 or 3 years.

War is being waged on a majority of hard working responsible Americans. Call me old fashioned, but I do not believe that this country amounted to greatness due to punishing and robbing those that do everything right only to reward those that did everything wrong. A trend like this cannot continue and must not continue, America’s stability depends on it.

787 Billion Stimulus Package Details

People interested in the details of this package, the final number of 787 of which appears to be the final and set number can examine the following.  Since there is hardly any point in raving or ranting about the inevitable package I am instead providing resources for people that are interested in learning more information about the biggest spending bill in America’s history.

My work: I read the bill in parts and summed up important details here.  However some items and number of billions allocated may have changed.

Official website:  Recovery.gov according to the bill is the official website that will provide transparency and clarity to us all. 

Other websites:

National Review has a brief list in no particular order that they find objectionable/interesting.

ProPublica:  This is probably the most comprehensive list, but it lacks any details/wording of allocation or reasoning, I find this to be of limited use, but gives you a sense of who the big recipients are. 

Actual Bill:

Feeling brave and have lots of spare time on your hands?  Have a law degree?  Want to melt your eyeballs and fry your brain before Obama gets his hands on it?  Read the bill yourself!

First 496 Pages

Remaining 575 Pages (all the tax information)

GOP Stands united on 787 billion stimulus

UPDATE:  Senate passes the bill 60-38 and it will be signed next week.  After all the work and the passionate speeches, websites, facebook groups, awareness and general broo-haha this boondoggle finally clears the finish line.  Not much more we can do here, but prepare for the next spending project that is expected to come down the pipe shortly, the Omnibus.

Yet another impressive showing, albeit not as powerful as last time by the House republicans standing united against the “revised” stimulus. I say “revised” in jest, as there is not much difference in this bill from a fundamental standpoint. A bill that is entirely tailored to the spending interests of liberal groups, laughable tax incentives and senseless research projects cannot be supported by fiscally minded individuals. Even if the number is down from 819 to 787 B-b-b-billion.

There is just one difference this time, fewer Democrats stood with the GOP this time. Where as last time 11 brave souls broke rank, only 7 defected this time.

Senate is spending taxpayer money in a useless fashion and continuing to debate this bill for no apparent reason. I will post updates here.

House and Senate agreeing on Stimulus package

Congressional committee talks have resulted in what appears to be a deal reached between the two legislative bodies. The price tags keeps fluctuating between 780B and 834B and as of now it seems like it’s on the lower end of the spectrum. Differences that amount to 5% of the total package are not serious enough to sway one’s opinion, however what the actual bill contains seems to be different than the original House passed bill.

Because the actual provisions are still being ironed out and the possibilities of additional amendments being added still exists I will refrain from going over the recently added items. Fundamentally the original problem with the bill still remains, there is a significant lack of anything really stimulative. Even if we account for the expanded shovel ready money from 30 to 45+ billion, the impact is negligible. Tax cuts are still not existent and and as previously highlighted, tax rebates and an AMT patch are nothing new. In fact the rebate checks will not come in the form of one paycheck, but will be distributed through payroll such that most individuals will see $15-30 dollars added to their paychecks. I don’t think this will have any kind of impact on the consumption what so ever, looks like a feeble Keynesian attempt destined to fail.

The big winner as of now clearly seems to be the department of education receiving by far the most ranging from special education to administrative costs. Why that department exists despite the failure of public education is beyond me and why do people assume that throwing additional funds is some kind of panacea? Just how much longer can this madness continue and I will spare you the tired old cliches defining insanity.

Stay tuned for further updates on this slab of pork.

Stimulus or Nostimulus? Nostimulus passed today.

Due to yesterday’s cloture today’s vote was a mere formality, however the fight is not quite over. Due to the heavy modifications of the bill, a next step involves the bill moving to a conference committee. There they will have to once again compromise and after reaching a happy medium, this well done slightly salted slab of pork is moving to Obama for digestion.
Like me, you are probably somewhat exasperated and maybe called and wrote to many Senators this past week to no avail. But the fight is not over yet.

What can you do!?

Americans for Prosperity have setup a nostimulus website where you can sign a petition. Check out the website and when you are ready, in case you need further incentives sign the petition!

Remember, there are plenty of resources on the web available that dissect this stimulus bill blasting giant holes in both it’s original purpose and the rhetoric behind why America should support this pork sandwich. Send material to your liberal friends and urge them for the sake of this country to sign the petition. Conservatives cannot do this alone and frankly they should not, every American is going to be adversely affected if this stimulus bill package is signed into law.

Oh and chew on this for a while.

“Only government can break the vicious cycles that are crippling our economy.” – Barack Obama

Stock market rejects stimulus bill and TARP2.

There is no single better indicator of future economic projections than the stock market. Traditionally the market always signaled what direction the economy is heading by a good six to nine months. The market is talking to us and if we listen, the following has been said since late 2008.

1. The market did not like Barack Obama. Ever since the reality of him becoming president set in, the market shaved off a tremendous amount of value. Obviously September and October are traditionally bad months and that contributed to the sell-off, but if there was one mandate made in November, it was done by investors and traders.
2. The market continued to dislike Barack Obama with the worst post-election week sell-off in American history.
3. The market did not like the TARP. Since TARP most of the companies involved and the precarious $BKX (Banking index) are now lower than they were when TARP was announced.
4. The market does not like the stimulus bill nor does it like TARP2. Today the market shaved off close to 5% on all major indices.

S&P down 42.74 closing at 827.16.

Regardless of what your opinions on the stimulus package may be, America’s financial markets are feeling the ever growing pressure of the government’s probing hand. This means further damage 401K’s and a continued decline in confidence both domestic and international. While the market has always been a buy the rumor-sell the news creature, it is impossible to ignore the precipitous declines since the emergence of Barack HuSedGovtIsBad Obama.

Obama press conference, magic of a salesman

All the hype today was centered around Obama’s first press conference and whether or not he will be able to sell the need for a stimulus package. Unfortunately for Obama the level of ingenuity apparently tapered off as his campaign concluded. Recycling the same rhetoric over and over capitalizing on America’s willingness to give him the benefit of the doubt is starting to wear a bit thin.

Bush may be gone, but the constant reminder of his “failed policies” continues to ring on and begs the question, what is the statute of limitations on blaming the previous administration? Ironically of course, Obama is trying to sell America on the New Deal Part 2. It matters not that the first New Deal has now proven to be a disaster and may be largely responsible for prolonging the Great Depression. It matters not that FDR used Herbert Hoover (an interventionist much like Bush) as a scapegoat for years and years, and certainly it matters not that virtually every economist of that time got it all wrong. Consequently historians got it all wrong too and the pervasive misunderstanding of what both caused the Great Depression and FDR’s abilities have been greatly over hyped. Unfortunately for the president and many liberals the knowledge is still lurking in some dark corner of extremist thought. For those curious, Milton Friedman and many others since then have explained precisely how the Great Depression started and why the New Deal was a nagging malaise.

Instead, in 2009 we are treated to a press conference by the zealous Obama who insists that a failure to act would result in a catastrophe. Yet at the very same time a government agency called the Congressional Budget Office determined that our recession will be over by the end of this year! Furthermore Obama insists that this economy is the worst it’s been since the Great Depression, yet this is also a grandiose exaggeration. In fact both the recessions in the early 1970s and 1980s were deeper and more damaging.

Worse still, Obama pounds the theme of tired old policies and their demonstrable failures. What exactly is he referring to? It matters not once again, because the American public feels the hardship and naturally blame the Republicans as those last in control. Americans ignore the fact that Bush acquired a recession from Clinton and proceeded to pull us out of it by deep tax cuts across virtually all brackets. Sadly Bush in his infinite Keynesian wisdom spent like a drunken sailor, but the question remains; what failed policies? If Obama is referring to Bush spending as a malady to our current situation, then he is absolutely correct, but why is he proposing spending even more? If he believes that Bush’s rebate checks were a failed policy, then why is the main attraction of the stimulus bill’s rebate checks? If he believes that deregulation caused a surge in home buying why are there tax credits and give aways for new home buyers?

Obama’s press conference is a demonstration of an orator who is lost in a fog, constantly driving home the message that the previous administration is the bane of our existence – yet ironically, proposing agendas with no discernible difference. His campaign speeches were amusing only because they were effective and harmless, but he is now purposely misleading the American public. Scarier yet, there remains one other aspect about FDR and his cunning genius. Much of the New Deal was focused on areas that at that time were considered Republican strongholds. He cleverly funneled federal aid into areas where it was advantageous from a political standpoint in order to garner more support in upcoming elections. FDR was a man obsessed with power and since Obama’s only experience consists of rising for higher office, the analogies are unmistakable and hard to ignore. The stimulus bill is a litany of liberal spending agendas that traditionally and historically pass through appropriations, but as long as Obama continues to trumpet the alarms, he will get his way and then some.

Thankfully in this age of transparency and instant communication, Obama’s magic tricks may fizzle out and in 2010 America will respond, putting this magic show out of business.

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