Tuesday, March 3, 2009

A Pattern of Stupidity

One thing I've noticed is that our "leaders" keep making the same damned mistakes, despite knowing what happened the week before. And we're not even talking history. We're talking current events.

Take Ron Kirk, Obama's nominee for U.S. Trade Representative. He has tax problems. Now, after Geithner, and Daschle, and whatever others, wouldn't you overhaul your vetting process on the double quick? Guess not. Or is this just an attempt to fly tax cheats under the radar because they'll be good little minions? Doesn't really matter. It's dumb. And it also requires I slap "Change We Can Believe In" in mocking quotes.

We see the same with the entrenched GOP. They'll make a statement, piss someone off, then break out those linguine spines when it matters, forgetting that leadership is taking a principled position and sticking with it. The most recent example is RNC (Recalcitrant Nipple Creamers) chairman Michael Steele. First he dismisses Rush Limbaugh as just an entertainer, then, when Rush issued a retort, he changed his tune. My advice, Mikey: Pick a position and stick with it. If you don't like Rush (now that you're RNC chairbitch) then when he calls you out come back with a big GFY. You might look like a leader.

And that brings me to the inspiration fort this post. Stupid bailout mania, AIG specifically. Come on, folks, haven't we thrown enough money out there? More money for them. More money for the banks. More for the automakers. More here. More there. More money everywhere.

And I'm not just screaming about the amount Obama is wasting. The bailout concept is not shiny and new here. But even as recently as 1979 (the Chrysler bailout), it was expected that this money would be paid back and that it was an isolated move.

Not anymore. Starting with the Dastardly Bastardly Bailout (a bipartisan abomination under Bush), we began throwing assloads in applecarts of cash at anyone who fell under the nebulous "too big to fail" moniker. And take AIG for example, they're on round four!!!!!!!!

Yes, AIG is on their FOURTH BAILOUT!

Okay, time to puke. And sit mindlessly and wait for my damned bailout. I'm sure the administration will get around to me eventually.

So here's the question: When what you're doing is NOT working, do you keep doing it?

28 comments:

jameswolfer said...

Hey Patrick,

I am finding I am starting to actually agree with you about 50-60% of the time. And that percentage grows. I am a registered republican, but I think I've become a left leaning moderate.

I've found myself growing disgusted with the GOP, however. I don't like the "trickle down" mentality. It hasn't worked. The GOP has been in power for all but one presidency in the last 29 years, and we haven't seen a lot of the trickle down.

Where I agree with you is on the bailouts. Its not working. Why are we allowing it to continue?

In my opinion, we should stop bailing out the companies that are failing. I know it will cost jobs, but we are just delaying the inevitable. Maybe a fair compromise would be just ONE bailout. If that doesn't work, then let the failure die.

Its a little darwinian economically, but if those companies can't make it, then something else can spring up and replace the failures and be successful, and then new jobs will be created. By letting old, dying giants live on, we are squelching the companies and industries that should be taking their place. Look at microsoft and apple: The computer age came in, and has invaded just about every other industry. What are we squelching while injecting a little more life into dying industries?

Back on to the left-leaning moderate thing, you should check out this article. Its got a few good things to say.

http://www.nytimes.com/2009/03/03/opinion/03brooks.html?_r=3&ref=opinion

Toad734 said...

I agree, if you can't do it with 4 bailouts and you are still sending execs to corporate retreats time to pull the bucket from the well. LET THEM FAIL! This will only mean new business for their competitors which would be widely welcomed. Most of the people who get laid off can go work for them. The Execs are rich anyway so they don't need a job.
While we are at it, let one of the big banks fail too.

Time to flush that turd.

Gordon said...

If I'm understanding what I'm reading about it all, the government expects to get back most or all of the money they've put into AIG, Citi and BoA. It might take a while to get it back, though.

AIG is a big, big company. Apparently nearly all of it is profitable. Insurance companies make money by investing premiums, and there was this one little investment division based in London that invested in credit default swaps and CDOs. They made huge profits doing that--until the housing market crashed. Now that little division is tanking the rest of the company.

So the bailout of AIG is similar to the bailout of the banks. Geithner et al believe that having them fail would start another chain of failures that would have a devastating effect on commerce.

The lesson to take from this is, I guess, is that perhaps economy of size has its practical limits.

Dave Miller said...

Jimmiebob, welcome to the show.

Good points, but we all know no president is going to support openly a policy that directly leads to losing jobs.

It is political suicide. This is what keeps countries like Mexico from moving into the technological society.

But one month is hardly enough time to judge the effectiveness of the "War on Poverty!"

dmarks said...

The AIG is broken. Time to stop trying to put Humpty Dumpty back together again.

Dave: War on poverty? How about Obama's war on the poor? His budget ends vouchers to help educate poor children in Washington, DC. I guess his SCHIP health care funding for well-off adults is much more important.

Patrick M said...

JW: First of all, welcome. Now to the reaming: :)

I am finding I am starting to actually agree with you about 50-60% of the time. And that percentage grows. I am a registered republican, but I think I've become a left leaning moderate.

Wait. If you're agreeing with me more, you can't be leaning left. That's Bush/McCain/Obama territory. I'm leaning Libertarian, almost.

The danger of leaning moderate is that it cedes the issues of the debate to the left, meaning conservatism has to be addressed in liberal terms, with the words 'free market' duct taped on to differentiate it.

Democrats want to reform health care, the GOP wants to do the same, except with 'free market' solutions. Same for Social Security. Same for bailouts. Same for education.

The way we look at government in general has been altered so that we look at the problems through a broken prism. And the solutions, though better than what the Democrats vomit out, are still bad.

And if David Brooks is the model of opposition you're looking for, we can look forward to Democrat rule for a long time.

Toad: Strange. You usually disagree with me, but when it comes to Big Business, even you see the folly of throwing money at problems.

This is something that Washington is famous for, and absolutely something that is at the heart of liberal philosophy: Government control and manipulation of industry.

LET THEM FAIL! This will only mean new business for their competitors which would be widely welcomed. Most of the people who get laid off can go work for them.

Glad to see you finding your conservatism. :)

Gordon: If it were a one-time thing with a good chance of success (and not throwing bad money after good money after bad, etc, I wouldn't be as pissed.

There are also market forces and government processes designed to handle these kinds of situations. The only reason the government has to get this entangled in bailouts is if they want to exercise control over the companies and industries.

Dave: ...we all know no president is going to support openly a policy that directly leads to losing jobs.

If the president had balls (and was conservative), he would.

However, that's not the debate. The debate is whether or not it's the government's role to prop up a company to falsely maintain jobs that are already gone.

But one month is hardly enough time to judge the effectiveness of the "War on Poverty!"

Is 80 years? Because that's how long we've been doing it. And it makes Vietnam look like a shining victory in comparison.

Dmarks: I have nothing to add to your comment. Just didn't want you to feel left out.

jameswolfer said...

Patrick,
Thanks for the welcome. What I meant was that although I am left leaning, I find that you make a lot of sense to me on around 50% of your posts, especially stuff like the fourth bailout of AIG. Ridiculous.

I agree with Toad. Now that they've receieved three bailouts and haven't succeeded, let them fail. Something else will take their place.

Dave: I know its political suicide. Obama would do much better if he just did it though. He might not be reelected, but he would be looked at better by future americans as the president who made the hard decisions and realized the problem couldn't be fixed in four or even eight years. Too many politicians just want reelection. I know, its their career, but c'mon. We need some people of intregrity here. Just an empty wish, but I still wish it were so.

TAO said...

Slowly, Patrick is becoming a leftist. He doesn' realize it yet but he is starting to see the light! :)

AIG is already planning to spin it self apart, they are already running ads for car insurance under "21st Century Insurance" seen them today.

What they will do is spin off their home, auto, and business insurance and leave AIG with all the toxic crap, life insurance, and the bailout IOU.

Thats their plan. We actually bailed them out because of the effect their collapse would have on the world markets

Realistically the U.S. Government should have bought their healthy business from them and left them with the toxic stuff and then seen how well these titans of business could operate.

SBA announced today that they only guaranteed less than half the small business loans in 2008 that they did in 2007. I think the SBA should go into the loan business directly rather than subsidizing our banking system to give out SBA loans.

I think the U.S. Government should have pumped money into the small community and regional banks that are not hurting and let them grow and let Wall Street solve their own problems.

Would have achieved alot more with a lot less than what we are going to get out of these trillion dollar bailouts...

But, our government does not work for the people.....

Jennifer said...

Patrick.....a leftist? Don't make me laugh...Ha, Ha, Ha (Vinny Bobarino style)

I don't understand why they keep throwing money at AIG. How many times do they have to throw it in our faces before we realize that it is a WASTE of money. Seriously, fool me once, shame on you, fool me twice, shame on me....fool me four times????

The problem is that it's republicans and democrats both doing this. Who the hell is representing us? Standing up for us?

TAO said...

Jenn,

They keep bailing our AIG because their credit default swaps total 55 trillion dollars. If they fail then you have THAT loss to deal with.

Needless to say a 55 trillion dollar loss will SHUT DOWN our economic system totally.

Everything would just stop.

Where government failed was when they allowed businesses to become too big for their own good.

Once you start to realize that our economic system is crumbling like a deck of cards and that our government is trying to prop the system up because the assumption that if you let firms fail others will pop up to take their place is false because it assumes a healthy economy which we do not have.

Once you start questioning not government policy but economic systems then you becoming a leftist.

The issue is why did we allow AIG to take the risk that they did without expecting them to have the resources to meet that risk?

Why did we allow banks to issue mortgages without expecting 20% down?

Why did we allow credit card companies to issue credit limits well beyond an individuals ability to pay?

Why did we allow an economic system to develop that allowed the decisions of a few to effect everyone?

Capitalism may be the most creative force known to mankind but it can also be the most destructive.....as we are finding out.

Once you start worrying about your own livelihood, your own mortgage when you know that you are hard working and have always played by the rules and once you open your eyes you end up thinking like a leftist.

As long as you keep harping about lower taxes and less government then you are not focussing on the real issues we are facing.

Bob said...

Yes folks, we are now being ruled by a absolute Idiot.
Socialism would have been a far less devastating choice.
Even Communism has higher moral standing

dmarks said...

Bob: You are exaggerating a bit I think! I'd much prefer Obama over a real socialist like Stalin or Pol Pot.

dmarks said...

Tao: "As long as you keep harping about lower taxes and less government then you are not focussing on the real issues we are facing."

Overtaxation and government meddling (such as causing the mortage mess with Fannie-Mae, etc) ARE real issues.

TAO said...

Sure they are dmarks....

Sure...that is why we are bailing our AIG.

Thats why Wall Street needs to be bailed out because Freddie and Fannie did what?

That is like blaming FDIC when a bank goes belly up.

Toad734 said...

Patrick:

Yes in principle I agree. Yet I also agreed with the Feds loaning money to Chrysler in the 80s. I don't mind that type of support but yes blindly throwing money at a problem isn't going to fix it. To be fair, Obama isn't blindly throwing money, that was Bush. Obama has actually asked to see their game plan and "asked" them to reign in expenses such as CEO pay and stupid corporate spa retreats...A lot of good asking did.

However, we shouldn't let all of them fail. We just need to thin the herd. When you thin the herd you make the herd stronger.

And the difference between you and I and why I am not a conservative is that I actually realize that the problem here is the free market with not government intervention which allows these guys to do what ever they want and cook the books for short term profits and CEO payouts. We shouldn’t Nationalize the banks or most businesses (besides utilities and other things relating to our security) but we shouldn't let them give loans to homeless people, or pull some S&L Junk bond, deregulate depression era policies, Enron, shit just for short term profits.

You would still contend that even though with this, the great depression, Enron, etc. that the free market is the only way to go. Saying that the Free Market doesn't solve all problems is still very liberal and realist, which are usually synonymous anyway, although some liberals do tend to get a little too idealistic. Not idealistic in the sense that we should run our country according to old testament laws and that maybe Man used to ride dinosaurs to church, you know, that’s for the conservatives but idealistic none the less.

Toad734 said...

Jameswolfer:

You said we haven't seen much trickle down??? We haven't seen any. The middle class has stayed stagnant, the poor have gotten poorer and the rich have gotten richer. The rich havent been spending their money, they have been hoarding it and then when they do gamble it away in the stock market and they loose, the working man has to come in and bail him out. Trickle down is the biggest joke on the planet.

However, I have a new plan; a new kind of trickle down policy that just may work. It's called Forced Trickle Down Economics.

What you do is get a bunch of Teamsters whose jobs have been sent overseas by rich people and you hired them to break rich peoples shit. So, you steel the metal out off their houses, break the windows out of their cars, burn their homes down, pour sugar in their gas tanks, clog their toilets, bust their pipes, pop their tires, spill wine on their suits, spray paint their purse dogs, etc. Then these rich people will have to hire mechanics, plumbers, carpenters, etc. buy more cars more clothes etc which will give working people more money and keep them working.

That is about the only type of trickle down economics that will work. When you cut their taxes all you do is divert money away from social services, state governments, highways,etc. which also provide working people with jobs.

TAO said...

One day conservatives will just have to face the fact that supply side economics did not lead to anything trickling down and rather led to a concentration of wealth....

And history shows us that a concentration of wealth leads to upheavel and socialism...

But for now we will grow complacent with beating our drums to lower taxes and less government....

dmarks said...

Tao: "That is like blaming FDIC when a bank goes belly up"

If the FDIC demands that the banks make bad loans to undeserving people, then your analogy matches. And they are to blame, in that case.

"But for now we will grow complacent with beating our drums to lower taxes and less government...."

Because that moves us away from socialism.

Toad: "What you do is get a bunch of Teamsters whose jobs have been sent overseas by rich people and you hired them to break rich peoples shit"

That is similar to what happens at Teamster's strikes. Except the Teamsters are throwing their own jobs away themselves, and instead of breaking rich people's shit, they assault the actual workers and break the workers' shit.

Pasadena Closet Conservative said...

And the Libs are too afraid to see it all for what it is. That would mean that we conservatives are right, which they would never, ever admit.

TAO said...

dmarks,

Exactly how did Fannie Mae and Freddie Mac "demand that banks make bad loans to undeserving people"

Lower taxes and less government can also lead us away from capitalism and toward fuedalism also...which is not a good thing either.

Its kind of like after the Roman and Greek periods we entered the dark ages...those were not socialistic times nor did they represent an advancement but actually a return to a state of nature that represented a regression.

Toad734 said...

For the last time:

No mortgage lender was ever forced by the government to give loans to homeless unemployed people.

No Bank was ever forced to buy these sub prime loans from these mortgage companies and count bad debt as profit.

Fannie Mae and them did give loan guarantees and the feds did lower interest rates to make homes more affordable for the masses.

After Bush took office and the economy slowed and Wall Street was slacking, the only safe investment was real estate. Wall street, seeing this trend and watching the housing bubble grow, decided to buy those loans and sell them with their financial products. They encouraged Country Wide to give more loans which they could buy. Country wide, having a buyer for a loan given to someone with poor credit, went ahead and issued the loans and sold them to the Banks just like the banks asked them to do. The banks thought they could get away with another massive wealth transfer like they did in the depression where they repossessed middle class houses and were able to concentrate even more wealth at the top. This time it backfired and the values of these homes plummeted and their plan was foiled. Now, we are still transferring wealth from the middle class to the wealthy, just now they are using my tax money and giving it to rich people instead of rich people just taking my home and equity and selling it off for profit.

I am going to donkey punch the next person who says "Democrats forced banks to give bad loans". Its almost as big of a lie as the creation story.

TAO said...

Ah, Toad....

Don't donkey punch me but are you telling me that Adam is not my daddy? :)

Patrick M said...

I had more comments, but I got too distracted. Still...

Toad: I am going to donkey punch the next person who says "Democrats forced banks to give bad loans". Its almost as big of a lie as the creation story.

As long as there's no donkey show involved, punch away.

It's not as though the government (mainly Democrats) forced companies to take on bad loans. No one articulate is saying that. But this is where your dim-assed understanding of capitalism shows through.

All businesses and management operates in their own self-interest. In a purely free market, they seek to spend as little as necessary to make the most they can while everybody else is doing the same. It's not always perfect, and there is dishonesty sometimes, but it means everybody has a relatively level playing field.

Add government to the mix. They make decisions based on lofty political goals like "everyone becomes a homeowner" and "Internet in every nudie booth." To do this, they create conditions that appeal to a certain group (subsidizing risk, like Fannie and Freddie). And if they want more movement, they create programs and rules (the CRA) that indirectly force (through threat of punishment) companies to make more of these loans if they want to operate in certain areas.

And as those rules, and many others, get rewritten over and over, the conditions change and eventually, companies that were taking advantage of the market in one set of circumstances find themselves teetering in another. And if it coincides with something like the housing bubble, pop.

I'm not defending a single CEO for what they did. But the conditions had to be there to create this mess and those conditions don't occur naturally.

Toad734 said...

They are still free not to give loans. They don't have to take the carrot. If banks had their way interest rates would be at 20%. I am thankful, and I am sure everyone here is too, that the government lowered interest rates which allowed me and probably most of the people here, to be able to afford their own home. Is home ownership a right? No, should everyone own a home,is everyone qualified? no and the government would say the same thing but the problem is that Wallstreet didn't agree. They were the ones who coninued to buy bad assetts.

Now, they may have subsidized some of these companies or threatened to not subsidize them to give loans to the homeless but again, that isn't the free market to begin with so the government should have never had any power to hold over these companies in the first place. You act as if it ok for these guys to suck on the government tit, write laws our politicians enact and then its only bad when the government asks them to give a loan to a black guy. What they did was give loans to every black, white, mexican, immigrant guy they could find; that isn't what the government asked of the them and they should have never been reliant enough on the government, or owed any favors to politicians, to have let themselves be put into those situations.

Patrick M said...

Toad: Do you always disagree by agreeing with me?

If banks had their way interest rates would be at 20%.

Considering the mess we're in was caused by lower and lower interest rates.

One of the things I've been saying is that credit needs to dry up a little for a while to clean out the crap. But the government is trying to make the market do the exact opposite.

You act as if it ok for these guys to suck on the government tit, write laws our politicians enact and then its only bad when the government asks them to give a loan to a black guy.

Cite it, or shut up. Because I've been hitting everybody with a government tit in the mouth.

dmarks said...

Tao: "Lower taxes and less government can also lead us away from capitalism and toward fuedalism also...which is not a good thing either."

Lower taxes and less government (compared to what we have now) lead is toward capitalism and away from feudalism. As it means that the feudal overlords (government) are less rich and have less power.

"Its kind of like after the Roman and Greek periods we entered the dark ages...those were not socialistic times nor did they represent an advancement but actually a return to a state of nature that represented a regression."

It was socialistic in that it still represented a strong, abusive government. Regressive in thought, compared to those Greek and Roman philosophers, but still overpowerful and rapacious.

Toad734 said...

Are we deleting comments now or is my computer just junk?

Patrick M said...

You're computer's just being a bitch. I make it clear in the rare instance I delete a comment.