It seems to me one of the major problems we’ve got is credit drying up. So we bail out the banks, yet they still don’t extend credit. They seem to think expensive trash cans for CEOs are a bigger priority. Perhaps we need banking – in some way – to become a federal concern. That way you extend credit and have the federal government absorb and back the risk. Of course the downside is you add federal bloat to the process, and while you might want to make it temporary, that sort of thing has a tendency to become permanent when the feds get involved.
Its not an idea I’m wild about, but so far the solutions seem to be lacking otherwise. I certainly don’t trust the banks to come around, they were one of the engines that drove us into this ditch to begin with.
I have it on good authority that “the government will take over and do it better and for less money.” No worries, mate!
This is an example of why Democrats tend to lose me when it comes time to vote, and why it’s ironic when you guys claim to be ‘reality’ based.
Oliver posts this:
http://www.oliverwillis.com/2009/01/26/too-bad-mortgage-industry/#comments
whose net effect would be to add risk to the business of lending for housing. Then he makes this post, saying, hey, those dirty banks aren’t doing what I want them to do, the government should nationalize them! Hmm.. Do you think maybe the regulatory and lawmaking environment has made lenders think that maybe lending is about to get a lot more expensive in the future, so it might be a good idea to hold off? No way! That’s crazy talk! Laws and regulations impose costs. I have never understood why non politician people seem to think they can ignore those costs. (Politicians I can understand, because talking about costs does not get them votes.)
>That way you extend credit and have the federal government absorb and back the risk.
Just to be clear, what you really mean is that taxpayers (current and future) absorb and back the risk.
So Oliver, anything else that doesn’t seem to be working right in your opinion that you can apply your brilliant nationalization solution to? Oil industry maybe? How about those Wall Street robber barons? Hate those guys for making more money than me. And the Willis train of naivety rolls on..
What does history say? Let’s see, great depression. That spawned heavy federal regulation over the banking industry. The banking industry lobbied for seventy years to lose those regulations. When achieved, the industry went on a looting spree that has nearly wrecked the national economy. The bank welfare money that was supposed to put the credit markets back in shape has instead gone to maintain the crazy profiteering banking lifestyle. And you think re-regulating them or nationalizing them is out of the question?
Eliminate the middle man
Yeal, oil industry, definitely. Exxon-Mobil just reported a $200 billion profit. That’s a quarter of the stimulus package right there, and not even operating costs.
I still think the oil industry should offer help to the auto makers.
How about those Wall Street robber barons?
Public flogging in Battery Park.
So nice of you guys to come to the defense of people who wouldn’t piss on you if you were on fire.
Haplo=champion of the uber rich.
>So nice of you guys to come to the defense of people who wouldn’t piss on you if you were on fire.
I’m pretty sure you wouldn’t piss on me if I was on fire, so I kind of suspect that them being rich has little to do with it. That said, it’s good to hear an admission that your ideology is at least partly based on envy.
>Yeal, oil industry, definitely.
Do you ever wonder why you are called “statists” or “collectivists”? Wonder no more!
it’s good to hear an admission that your ideology is at least partly based on envy.
Oh, and your’s isn’t?
Do you ever wonder why you are called “statists” or “collectivists”? Wonder no more!
And? Your point is what, exactly?
>Oh, and your’s isn’t?
Nope. You want to penalize people that have done better than you because.. well apparently because it makes you feel better. I’d rather emulate someone who has done better than me.
>And? Your point is what, exactly
That statists and collectivists have a very bad track record throughout history, whether in an Israeli Kibbutz, Chavez’s Venezuela, or Soviet Russia. At worst those ideas lead to totalitarianism, at best they lead to a stagnant stasis. And yet you continue to be enamored of these ideas. It’s sad to see.
Midder,
Would you be referring to the Glass-Steagall Act? If not, which regulations that were gotten rid of would make everything better if brought back?
The bailout funds were designed to secure markets and allow banks to loan again. Minimal levels of oversight would have helped to accomplish that goal?
Instead, the rushed bill enacted by Congress and signed by the President (last fall) had few requirements for the financial houses to show how they were using the money.
The answer is to proceed slowly and thoughtfully. STOP, THINK, and then legislate.
100% irrelevant to this post, but since at some point in comments on this blog, I was wondering why on earth Bristol Palin and her fiance weren’t getting married before the baby arrived (consider that the Republican view that it was all OK was based on the baby’s not being born to an unwed mother), I felt obliged to come back here and note that it’s the fault of the Republicans:
If Miss Palin had gotten married, she no longer would have been a dependent, and would have lost the excellent health insurance given to the families of state employees like Gov. Palin. She and Mr. Johnson wouldn’t be able to afford their own health insurance, at a time when they had to cover her prenatal care and delivery expenses. So the next time you hear a Republican arguing against universal health care coverage, point out that the lack of it had made being an unwed mother an economically rational choice for Miss Palin.
Nope. You want to penalize people that have done better than you because.. well apparently because it makes you feel better.
Wow, I had no idea I felt that way. No, I don’t want to penalize people, I want all people to do well. It seems like the ones who want to protect the status quo are mostly on your side of the aisle, my friend.
That statists and collectivists have a very bad track record throughout history, whether in an Israeli Kibbutz, Chavez’s Venezuela, or Soviet Russia.
Well, that’s a load of crap.
Show how Venezuela under Chavez has been SOOOO bad, considering what the Chicago Boys did to that country for years.
What, do you think I’m in favor of hippie communes and dismantling the intelligentsia? Um, no.
The answer is to proceed slowly and thoughtfully. STOP, THINK, and then legislate.
Luckily, we elected someone who can do that.
That’s one, Futures Trading Practices Act of 1992, Commodity Futures Modernization Act of 2000. As well as 30 years of rule changes in the SEC, CFTC, FedReserve, Treasury Department, accumulated lobbying to several congressional committees, appointments in several key departments and lastly shifts in priorities at the FBI. A combination of law changes loading the stage and removing the Sheriff so the stage can be robbed.
To quote Atrios:
Stebe: Instead, the rushed bill enacted by Congress and signed by the President (last fall) had few requirements for the financial houses to show how they were using the money.
At that is one of the major failings of the bailout.
– What, specifically are you going to use the money for?
– How are you going to manage to pay the money back?
– What expenses do you have?
– What assets do you have to use as collateral?
If I walk into a bank to get a loan I expect to provide solid, reasonable answers to all of these questions if I want the bank to consider loaning me money. Especially the first two.
If I’m declaring bankrupcy (which is essentially what the banks did) I expect the lender to take a lot of interest in the third question as well. Do you really think I’d be allowed to continue to spend significant (or any) money on non-essentials?
Instead Congress and Bush just handed over hundreds of billions with essentially no conditions attached and no plan for how it would be paid back.
In a crisis brought on by loans being made without any of the aforementioned questions being asked of borrowers, Bush/Congress figured they could fix it by making a loan without asking any of the aforementioned questions.
Brilliant!
I’m not Midder, and I don’t know exactly what regulation(s) this involves, but whatever changed which encouraged lenders to lend money to people who couldn’t afford to pay back the loan if anything went wrong in their life or in the economy sure seems like a bad idea in hindsight.
- What, specifically are you going to use the money for?
- How are you going to manage to pay the money back?
- What expenses do you have?
- What assets do you have to use as collateral?
And what did we get?
“Badges? I don’t got to show you no steenking badges!”
Duros62: And what did we get?
“Badges? I don’t got to show you no steenking badges!”
And a Congress that now says they are “Shocked. Shocked!” that it didn’t work.
Doesn’t President Obama want this $800,000,000,000 stimulus plan passed as quickly as possible? He hasn’t been in office for two weeks, yet is getting ready to commit to nearly $1,000,000,000,000 in additional spending. The bill which passed the house was 680 pages long, and we’re expected to believe that everyone who voted for or against it proceeded in a deliberate and thoughtful manner? It’s like the Obama Administration looked at the bailout package the Bush Administration tossed out there and thought “Man, I could make an ever bigger boondoggle happen”.
Goddamn socialist statist commie redistributionist hippie fags…
Oh, wait…
“I’m not Midder, and I don’t know exactly what regulation(s) this involves, but whatever changed which encouraged lenders to lend money to people who couldn’t afford to pay back the loan if anything went wrong in their life or in the economy sure seems like a bad idea in hindsight.”
That wasn’t a regulation, or at least not an imposition of a new regulation on lenders. Rather, it was the creation of the mortgage-backed security. Once lenders no longer had to hold the loans in their own portfolios, but instead could repackage them into securities and sell them to entities that never saw the loan application, there was no reason for the lenders to be careful about lending. There was a great WSJ article about a woman with a *shack* in Arizona, that she’d bought for less than $4k, getting a $103k mortgage on it. The appraiser estimated it at a worth twice as much as any house in that area had sold for, but why not? The loan got diced into various securities, which a credit rating agency declared to be AAA, and then those securities were sold to various teacher’s pension funds and other investing entities.
Hurray for the private sector.
Here’s the WSJ article: http://online.wsj.com/article/SB123093614987850083.html
That sort of thing, multiplied by a million, gives you a massive financial crisis once mortgage payments aren’t getting made and housing values aren’t continuing to rise.
If you’re not familiar with the whole mortgage-backed securities problem, I highly recommend the shows that NPR’s This American Life has done on the topic — you can listen to them for free.
SFC B: The bill which passed the house was 680 pages long, and we’re expected to believe that everyone who voted for or against it proceeded in a deliberate and thoughtful manner?
I’m curious, did you have the same objection to the 342 page PATRIOT Act?
Part of the bill’s length is due to tax provisions that will be good for a limited time only. Anything that messes with the Internal Revenue Code is going to be really long and detailed even if it could be explained in four words (”reducing withholding in paychecks”) because the Code has so many internal cross-references, and when the change is only for a short time, that makes it even more difficult to ensure that it doesn’t affect more than it was intended to do. For example, if there’s a $500 credit for individuals and $1000 for couples, how does that affect the Alternative Minimum Tax? The sheer number of pages for a law that changes the tax code isn’t much of a measure of how much time you need to understand the basics of what it does.
In contrast, the PATRIOT Act had little to do with taxes, but a great deal to do with changing our intelligence apparatus, empowering law enforcement and the executive branch, and affecting our Constitutional rights.
SaveFarris says: “I have it on good authority that ‘the government will take over and do it better and for less money.’ No worries, mate!
Canada has better results when it comes to health care, and we spend less.
But don’t let facts get in the way of your political philosophy. That would be harmful to your ego.
Haplo9: “I’m pretty sure you wouldn’t piss on me if I was on fire, so I kind of suspect that them being rich has little to do with it.”
No, it has everything to do with you being you.
Enron is making massive profits while hurting the economy. Meanwhile you have record deficits. But you think making Enron pay extra taxes is punishment brought on by envy, instead of being angry that someone isn’t paying their fair share.
If the Fed bails out any bank then it should get a return on its investment. Call it ownership or stewardship or whatever, but it would be irresponsible to bail out a bank and _not_ nationalize it, at least temporarily until it becomes solvent again.
That’s the thing though — Wall Street want the money, but they don’t want to take any responsibility for it. Republicans _hate_ responsibility, personal or otherwise.
I did as a matter of fact. Anything which could have such a deep effect on our rights and civil liberties shouldn’t be rushed through in the heat of the moment. And something which is going to result in increasing our government spending by nearly $1,000,000,000,000 probably shouldn’t be forced through in the first couple weeks of a new president’s term. I’m glad you agree with me that this is something which needs a lot more work and development.
Gee, could Strowbridge mean “ExxonMobil?” I bet he does, because Enron is history.
Strowbridge being sloppy? Who’da thunk it?
Anyway, yes, ExxonMobil just announced record profits.
Also, over the last three years, ExxonMobil has paid an average of $27 Billion each year in taxes.
This year, that’ll probably go up (based on those record profits) and push their four-year total to over $110,000,000,000.
So, how much is enough?
Tell us, Strowbridge, why do you hate capitalism so much? Why do you hate success? Why do you hate those who provide a vital service, pay their taxes, and still manage to make a tidy profit?
J.
Tidy? TIDY?!
$450 Billion in PROFIT isn’t tidy.
That’s half of the stimulus bill right there.
Don’t they owe us (meaning the country) a little something in return on OUR investment?
Chill, Duros. You added a zero in there. (Hey, has someone seen Jaim? Duros found a zero, and it might be him…)
45 billion, not 450 billion. Try 5% of the pork package.
And ExxonMobil (NOT Enron) will pay about 30 billion in taxes already.
I repeat: how much is enough?
In 2004 (last numbers I can find), ExxonMobil paid more in taxes to the federal government than the bottom 50% of taxpayers (65 million tax returns) COMBINED.
Exxon’s tax rate in 2006 worked out to 41%.
The best numbers I can find say ExxonMobil makes about a quarter on every gallon of gas they sell.
The government makes about 46 cents in taxes on every gallon of gas.
Obviously, the problem here is that the government is not taking enough money.
J.
The government makes about 46 cents in taxes on every gallon of gas.
Jay Tea, since you’re talking about Exxon’s Federal taxes, you wanna balance out the comparison here–or do you not see anything a little off about the above statistic?
PG: Anything that messes with the Internal Revenue Code is going to be really long and detailed even if it could be explained in four words (”reducing withholding in paychecks”) because the Code has so many internal cross-references, and when the change is only for a short time, that makes it even more difficult to ensure that it doesn’t affect more than it was intended to do. … The sheer number of pages for a law that changes the tax code isn’t much of a measure of how much time you need to understand the basics of what it does.
No, but it is a measure of the time needed to make sure it actually does what you want it to. As you noted, even simple changes to the tax code can have lots of ramifications.
SFC B: I did as a matter of fact. Anything which could have such a deep effect on our rights and civil liberties shouldn’t be rushed through in the heat of the moment. And something which is going to result in increasing our government spending by nearly $1,000,000,000,000 probably shouldn’t be forced through in the first couple weeks of a new president’s term. I’m glad you agree with me that this is something which needs a lot more work and development.
Thanks. But note that where I asked about your view, you end by telling me mine. Let’s not go that route.
I would see a difference between the PATRIOT Act which was rushed thru in about a month and the current bill where “What should be done” has been discussed for 5 times as long. Is that still insufficient time? That is debateable. But let’s not take as a given that the two situations are the same.
IF there are objections to what the bill does, focus on those more than making the speed with which it is passsed the crux of your complaint.
Jay Tea: Obviously, the problem here is that the government is not taking enough money.
To an extent, that’s true. Gas in the US should cost a lot more than it does.
Sean:
Yes, but working out the ramifications of tax legislation can be turned over to the executive branch’s agencies (specifically, the geeks at Treasury and the IRS). I’m hoping it’s not just Democrats who believe rejiggering our Constitutional rights — particularly those protecting us from government invasions of privacy — is something that every Congressperson has to think through, whereas alterations to tax policy are appropriately left to tax experts. Do you really believe that every Republican who voted for the 1986 tax reforms had read and understood every page of it? especially, do you believe that Reagan did before signing it?
Every American should know his or her Constitutional rights in order to defend them (the number of people who don’t realize they can say “No” if the police say “Can I look in your trunk?” is astonishing). It’s really not necessary to the health of the Republic for every American to be familiar with IRC 162(m) and how it was affected by the first bailout bill.
Gas in the US should cost a lot more than it does.
Boggle.
When gas was over $4.00/gallon, that was a national crisis because it was too high.
Now that it’s just under $2.00/gallon, it’s a concern because it’s too low.
Tell ya what, Goldilocks — what is the “just right” price? And how do you wanna divvy up the profits between the government and the companies that actually do the work to generate those profits?
Let’s screw around with energy, economic, and national security policies just to meet YOUR idea of “justice.” That’s a surefire recipe for prosperity.
Then, kindly explain under what authority the government can just take control of a hunk of our economy.
And explain what would keep, say, ExxonMobil from saying “Screw this, we’ll move our headquarters out of the USA. Sorry, Texas!”
J.
Jay TEa: When gas was over $4.00/gallon, that was a national crisis because it was too high. Now that it’s just under $2.00/gallon, it’s a concern because it’s too low.
Ah, so you would support the idea that national policy should be set by Chicken Little? Anytime someone runs around yelling “crisis, crisis”, especially during an election year, that’s all the evidence we need to confirm there actually is a crisis?
An increase in the tax on gasoline would have to be carefully thought out, certainly, to make sure those of lower income who would be most adversely affected aren’t affected more than they could bear.
But the government uses taxes to adjust public behavior all the time. Charitable giving is encouraged by making it deductible. Tax policies are put in place to encourage saving for retirement, paying a mortgage instead of rent, paying for education, investing in municipal bonds and many, many other things which are viewed as desireable by the government.
Higher gas prices would encourage the development of alternate fuel sources, help clean the air, be a step toward ending our dependence on Middle East oil, etc. THE answer to any of those? Of course not, but there are benefits to getting people to use less gasoline.
As for the rest of your post, meaningless rantings and straw men. ANY tax is the government playing a role in how profitable a company is. “Screw”ing around with energy, economic, and national security policies to meet MY idea of Justice was never suggested but all in all would not be a bad thing IMHO, but I defy you to find anyone who says following there advice would be a bad thing so that was really kinda a stupid point to make, wasn’t it?
Jay Tea: And explain what would keep, say, ExxonMobil from saying “Screw this, we’ll move our headquarters out of the USA. Sorry, Texas!”
And explain why we should really care? Wherever they settle their headquarters, they’re still going to do business in and with the US which is really what counts.
“statists”
Because you don’t know how to spell “statistician”?
Israeli Kibbutz
Why do you hate Jews so much?
The bill which passed the house was 680 pages long, and we’re expected to believe that everyone who voted for or against it proceeded in a deliberate and thoughtful manner?
If people can read through a Harry Potter book in less than a day, I think 680 pages should be no challenge to people who have experience read and drafting bills.
Look, I know you ultra-cons want to destroy this country at all cost, but you lost your chance. It’s our turn to set things right.
When gas was over $4.00/gallon, that was a national crisis because it was too high. Now that it’s just under $2.00/gallon, it’s a concern because it’s too low.
Good thing we had that McCain-Clinton gas tax holiday last year. Would have been a REAL national crisis.
Jay Tea: And explain what would keep, say, ExxonMobil from saying Screw this, well move our headquarters out of the USA.
it is of corse only tax rates that keep companies here. that explains why haiti and afghanistan has so many large successful corporations– their low tax rates.
J.G.Thayer: “And explain what would keep, say, ExxonMobil from saying ‘Screw this, we’ll move our headquarters out of the USA. Sorry, Texas!’”
We would respond, “Screw you. You lose drilling rights in the States.”
You don’t pay taxes here; you don’t do business here.
CSS: You don’t pay taxes here; you don’t do business here.
Which is really the point. Where their headquarters is located is of minimal concern. They would continue to do business in the US so they would continue to pay taxes in the US.
Does JT really think a company moving it’s headquarters outside the US means they are going to cease all US operations?