The Smoke Break

You want some brie with that whine?

Maybe They’re Starting To Notice?

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So many Americans have been raising their voices in a chorus ranging from displeasure to outright anger for a year now but time and time again the administration simply ignores them.  Even when a million-odd citizens gathered on the Mall on 9/12 to protest the ever-increasing size of the federal government, the administration claimed they didn’t notice.  Indeed, President Walking Eagle made it a point to leave town.

It’s discouraging, to be sure, when phone calls go unanswered, mail responses are simply canned campaign-like responses, and face-to-face encounters go unacknowledged except as an excuse for the mainstream media to show off the more vulgar side of their limited vocabulary.  But there may be hope.  For not only was the Massachusetts special election just too big to be ignored, but the reasons behind it may actually start to be sinking in.  Though not exactly in a straight, forward direction.

David Axelrod stated that “in this weird political season, we have become accustomed to unusual outbursts” in the House during presidential speeches. 

I suppose that if you’re of the opinion that Government Knows Best, then having your self-proclaimed authority challenged might very well be considered unusual.  But I personally find it incredibly refreshing that ordinary citizens, like you and me, are finally beginning to participate more fully in the grand old glory that is the process of governing the Republic.  Our unique system of checks and balances provides for debate and there isn’t a damned thing wrong with an honest rebuttal.  But I suppose the key word there is “honest”.  As we, the people, slowly regain our insight into the workings of our government, it is clear that honesty is decidedly lacking and the main purpose of debate has been reduced to little more than posturing for position.

His Transparency has even resorted to avoiding press conferences for fear reporters will ask questions that we, the people, want answered.  The official spin is that the TOTUS prefers to instead give “interviews” (aka campaign ops).

And that spells not only Waterloo for His Transparency, but for all the progressive liberals in government and their dangerously socialist ideology.

Tainted TARP Tingle-Tales

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So you know what your government is doing? If you only listened to the mainstream media you’d think we were almost out of the woods. But the SIGTARP’s quarterly report to Congress was released this morning. And in direct contrast to President Walking Eagle’s tingle-tales about the program’s effectiveness in saving America from the mess he inheirited because of the actions of his predecessor and the Congress of which he, himself, was a part, Neil Barofsky, the special inspector general for TARP, didn’t have anything good to say.

The long story short is that TARP has provided little more than a taxpayer-funded safety net and basically nothing has been done to curb the underlying causes of the recent financial meltdown. The program is fraught with abuse and fraud and bailouts have, as many of us predicted, simply encouraged the continuation of the wrong kinds of risk-taking and, in Mr. Barofsky’s educated opinion, even more dire straits lay ahead.

“Even if TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car.”

Some highlights from the report itself:

It is hard to see how any of the fundamental problems in the system have been addressed to date.

Many of TARP’s stated goals, however, have simply not been met. Despite the fact that the explicit goal of the Capital Purchase Program (“CPP”) was to increase financing to U.S. businesses and consumers, lending continues to decrease, month after month, and the TARP program designed specifically to address small-business lending — announced in March 2009 — has still not been implemented by Treasury. Notwithstanding the fact that preserving homeownership and promoting jobs were explicit purposes of the Emergency Economic Stabilization Act of 2008 (“EESA”), the statute that created TARP, nearly 16 months later, home foreclosures remain at record levels, the TARP foreclosure prevention program has only permanently modified a small fraction of eligible mortgages, and unemployment is the highest it has been in a generation. Whether these goals can effectively be met through existing TARP programs is very much an open question at this time. And to the extent that the Government had leverage through its status as a significant preferred shareholder to influence the largest TARP recipients to carry out such policy goals, it was lost with their exit from TARP.

• To the extent that huge, interconnected, “too big to fail” institutions contributed to the crisis, those institutions are now even larger, in part because of the substantial subsidies provided by TARP and other bailout programs.
• To the extent that institutions were previously incentivized to take reckless risks through a “heads, I win; tails, the Government will bail me out” mentality, the market is more convinced than ever that the Government will step in as necessary to save systemically significant institutions. This perception was reinforced when TARP was extended until October 3, 2010, thus permitting Treasury to maintain a war chest of potential rescue funding at the same time that banks that have shown questionable ability to return to profitability (and in some cases are posting multi-billion-dollar losses) are exiting TARP programs.
• To the extent that large institutions’ risky behavior resulted from the desire to justify ever-greater bonuses — and indeed, the race appears to be on for TARP recipients to exit the program in order to avoid its pay restrictions — the current bonus season demonstrates that although there have been some improvements in the form that bonus compensation takes for some executives, there has been little fundamental change in the excessive compensation culture on Wall Street.
• To the extent that the crisis was fueled by a “bubble” in the housing market, the Federal Government’s concerted efforts to support home prices — as discussed more fully in Section 3 of this report — risk re-inflating that bubble in light of the Government’s effective takeover of the housing market through purchases and guarantees, either direct or implicit, of nearly all of the residential mortgage market.

…the Government has done more than simply support the mortgage market, in many ways it has become the mortgage market, with the taxpayer shouldering the risk that had once been borne by the private investor.

Treasury’s failure to discover the scope and scale of AIG’s executive compensation obligations, in particular at AIGFP, potentially resulted in a missed opportunity to avoid the explosively controversial events surrounding the AIGFP retention payments and the considerable public and Congressional concern that followed. Although SIGTARP saw no indication that Secretary of the Treasury Timothy Geithner (the “Treasury Secretary” or “Secretary Geithner”) had personal knowledge of the AIGFP bonuses until shortly before they were paid, this too suggests a failure of communication. In light of the political sensitivities associated with the bailout of AIG, in his role both as then-President of FRBNY and subsequently as Treasury Secretary, it was necessary that Secretary Geithner be informed by his staff, in a timely manner, of such sensitive and significant information so that he could have sufficient time to explore possible solutions.

Through December 31, 2009, SIGTARP has opened 86 and has 77 ongoing criminal and civil investigations. These investigations include complex issues concerning suspected TARP fraud, accounting fraud, securities fraud, insider trading, bank fraud, mortgage fraud, mortgage servicer misconduct, fraudulent advance-fee schemes, public corruption, false statements, obstructionof justice, money laundering, and tax-related investigations.

On October 22, 2009, the Special Master, who was appointed without the advice and consent of the Senate, made determinations concerning executive compensation within AIG, Bank of America, Chrysler Financial, Chrysler, Citigroup, GM, and GMAC. …on November 2, 2009, SIGTARP requested from the Chief Counsel of OFS an explanation of Treasury’s legal position regarding the constitutionality of the position of the Special Master. A copy of that request is included in Appendix G: “Correspondence.” Treasury has not yet responded.

Although Treasury has projected an overall profit from CPP , any such profit will be diminished by billions of dollars in losses in certain CPP investments in which the banks have closed or reorganized. Three TARP recipients — CIT , UCBH, and Pacific Coast National Bancorp — have declared bankruptcy. Although there were two different paths to the organizations’ bankruptcies, the result for taxpayers appears to be the same — total or near-total loss of their investment.

As detailed in prior quarterly reports to Congress, one of SIGTARP’s most important recommendations with respect to PPIP has been that Treasury require strict information barriers or “walls” between the PPIF managers making investment decisions on behalf of the PPIF and those employees of the fund management company who manage non-PPIF funds trading in the same kinds of securities. For various reasons, Treasury has decided that requiring such walls “is simply not practical in the context of PPIP,” and has refused to adopt this recommendation. …a series of unusual trades undertaken in one of the PPIFs just weeks after trading began has highlighted the problems that can arise in the absence of a robust conflict-of-interest wall.

Of the $84.8 billion invested in Chrysler, GM, and their finance companies, $3.3 billion has been repaid. …According to the TARP Financial Statements, Treasury projected that, as of September 30, 2009, the AIFP investments will result in a $30.5 billion loss to U.S. taxpayers.

On November 9, 2009, the Federal Reserve announced that, of the 10 bank holding companies identified through its stress testing as needing additional capital, only GMAC failed to raise enough funds to meet the requirement.

From its inception, SIGTARP’s most fundamental recommendation with respect to basic transparency in the operation of TARP has been that Treasury should require all TARP recipients to report periodically on their use of TARP funds. …For the first time, Treasury will be collecting and publicly reporting this data on an institution-by-institution basis. Although regrettably delayed, SIGTARP believes that Treasury’s decision to provide this basic transparency will give meaningful information to the public and to policymakers on whether the TARP programs have met their goals and, as a result, may enhance the credibility of TARP. If implemented as described, Treasury’s plan on this front will constitute an adoption of SIGTARP’s recommendation and will finally give the American people the basic transparency they deserve in these investments.

On December 30, 2009, Treasury announced that GMAC met its SCAP capital requirement upon receipt of an additional $3.8 billion from AIFP. Treasury received $2.5 billion in trust preferred security plus $1.3 billion in MCP in exchange for this investment. Treasury also received warrants to purchase $127 million of trust preferred securities and $63 million of MCP, which it exercised immediately. In addition, Treasury is converting $3 billion of the MCP it acquired under previous TARP investments to common stock. As a result of these transactions, Treasury’s ownership of GMAC’s common stock increased from 35.4% to 56.3%, and it holds an additional $2.5 billion in trust preferred securities and $11.4 billion in MCP.

…infusions to AIG are linked inextricably: more than half the total amounts paid to counterparties in connection with the CDS portfolio retired through Maiden Lane III did not come about through the Maiden Lane III CDO purchases, but rather from AIG’s earlier collateral postings that were made possible in part by the original FRBNY loan, which was, in turn, paid down with TARP funds. Because of this linkage, the ultimate costs to the Government and the taxpayer cannot be measured in isolation. Stated another way, regardless of whether FRBNY is made whole on its loan to Maiden Lane III, the ultimate value or cost to the taxpayer cannot be calculated until the likelihood of AIG repaying all of its assistance can be more readily determined. Treasury’s recent suggestion to the contrary is, at best, incomplete.

…simply by purchasing comparatively tiny thrifts, Hartford and Lincoln [insurance companies] — companies whose primary businesses (unlike other CPP participants) have little to do with lending to consumers and businesses — gained access to more than $4.3 billion in taxpayer funds, an amount that is many multiples of the thrifts’ total assets.

It’s time to throw in the towel here. Oops. I mean, the TARP.

Michigan Taxpayers Subsidize Michael Moore’s Anti-Capitalism

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As a poster child for Democratic compassion, the state of Michigan, long known as the home of the auto industry, continues to show little signs of recovery.  Despite massive infusions of taxpayer money (that will never be paid back) and business plans created by those “best and brightest” affirmatively-graduated Ivy Leaguers, the only American auto company that is turning a profit is the only one who didn’t knuckle under the government’s spell in the first place.  Ford.

Michigan’s unemployment rate was the highest in the country at 14.6% as reported for December 2009, with the metropolitan Detroit area at 15.4% in November.  Of course, the underemployed and those who’ve simply given up looking for work mean the real numbers are much higher.

So what does a true-blue state do when faced with such dire straights?  They follow the lead of other lame-brain losers like California.  In this case, by courting the film industry.  So what, you say?  Sure, jobs are jobs and everyone needs the escape provided by a movie every now and then.  But unfortunately, the only escape with this feel-good endeavor is its disconnect from reality.

The Michigan Film Incentive is a state economic development program whereby state government offers large tax credits and outright cash subsidies to filmmakers who make some portion of their films here. The program rebates up to 42 percent of a filmmaker’s Michigan expenses. The amount that exceeds the filmmaker’s state business tax liability is reimbursed by a check from the Treasury and signed by John Q. Taxpayer.

Now guess who has directly profited from this?  You guessed it, Michael Moore.  That raving anti-capitalist who went rabid against big business in his last film apparently has no problem sticking his hands into the pockets of the taxpayers on Main Street to pad his personal coffers.  Just like those big, evil firms on Wall Street.

He is a current member of the Michigan Film Office Advisory Council, a state organ created to advise the Michigan Film Office, which is responsible for approving applications for Michigan’s film incentive program.

There’s a whole lot of other “perceptions of impropriety”, aka old boys’ network and cronyism at work here as well, which in the end makes it little more than yet another Democratic grab at the wallets of the very people they claim they are trying to help while the only ones making any real money are they and their buddies.

Recently, Michigan Film Office Director Janet Lockwood was given a role in a movie — “Wild Michigan” — that had been approved by her office for subsidies.  Lockwood blithely dismissed conflict of interest questions from my colleague, Kathy Hoekstra*, by arguing that the she had not been paid.  But as an actress she was in fact paid; paid with the opportunity to appear on the Silver Screen – an honor for which many actors would themselves pay.

Former state Rep. Bill Huizenga (now a congressional candidate) helped shepherd the Michigan film incentive program to passage in the Legislature.  He did so while sitting on the Board of Compass Film Academy, a Grand Rapids-based film school.  Lockwood called Huizenga — who was apparently given the moniker “Hollywood Huizenga” for helping muscle the film incentive through the Legislature — “our hero.”

But, but, but it can’t be all bad because regular people in Michigan worked on these films, right?  Sure.  Yet what they received in pay was merely another insidious transfer of wealth:

Michigan hiked taxes $1.4 billion just months before creating the film program to redistribute a portion of it to lucky filmmakers.  At best, this creates a jobs wash, not new economic growth.

We’ve said before that Michael Moore is an insufferable hypocrite who should be shipped off to someplace like Venezuela.  But the truth is that he and his kind continue to be enabled by the compassionate Democrats running the state of Michigan.

 

 

 

* no relation to Michigan State representative Pete.

Who’s Laughing Now?

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It was a big deal in the entertainment world when NBC decided to can Tonight Show host Conan O’Brien.  Personally, I found Conan’s final week hilarious and reminiscent of its good old days with Johnny Carson and “Coco” was very gracious as he said his goodbye.

And why shouldn’t he be?  Under the terms of the separation contract, NBC is paying O’Brien $45 million to not work for the next eight months, and he got them to give another $12 million to his staff of 200.

Not bad for a 7-month stint, eh?

But the one question no one is asking is:  exactly how can NBC possibly afford to pay out all this money?  Well, dear readers, the joke’s on you.  Via the government’s bank bailouts last spring.

I know, I know.  NBC isn’t a bank.

But in the Obamanation, that’s just a little legal technicality when your parent company is GE.

General Electric, the world’s largest industrial company, has quietly become the biggest beneficiary of one of the government’s key rescue programs for banks.

At the same time, GE has avoided many of the restrictions facing other financial giants getting help from the government.

The company did not initially qualify for the program, under which the government sought to unfreeze credit markets by guaranteeing debt sold by banking firms. But regulators soon loosened the eligibility requirements, in part because of behind-the-scenes appeals from GE.

As a result, GE has joined major banks collectively saving billions of dollars by raising money for their operations at lower interest rates. Public records show that GE Capital, the company’s massive financing arm, has issued nearly a quarter of the $340 billion in debt backed by the program, which is known as the Temporary Liquidity Guarantee Program, or TLGP. The government’s actions have been “powerful and helpful” to the company, GE chief executive Jeffrey Immelt acknowledged in December [2008].

—

Banking companies are regulated by the Federal Reserve and not allowed to engage in commerce, but federal law has allowed a small number of commercial companies to engage in banking under the lighter hand of the Office of Thrift Supervision. GE falls in the latter group because of its ownership of a Utah savings and loan.

Unlike other major lenders participating in the debt guarantee program, including Bank of America, Citigroup and J.P. Morgan Chase, GE has never been subject to the Fed’s stress tests or its rules for limiting risk. Also unlike firms that have received bailout money in the Troubled Assets Relief Program, or TARP, GE is not subject to restrictions such as limits on executive compensation.

What was that again about “too big to fail”?

A Stunning Week For American Liberties

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It has been a rather incredible week.  In a real “two fer”, the election of Republican Scott Brown to represent the state of Massachusetts as a United States Senator has sent both the ghost of Ded Ted and the unholy trinity’s health care “reform” back down to the hell hole from which they rose.  And then the Supreme Court, voting on straight progressive vs. conservative ideological lines, struck down most of the McCain-Feingold campaign finance act as unconstitutional.

All of which finds the left staring bug-eyed and slack-jawed.

As the shock wears off, in their anger at being told that their attempts to create a socialist dictatorship out of the Republic of the United States is now seen clearly for what it is and that the American people want no part of it, the spin begins.  His Transparency, in particular, is being, well, rather more transparent.  And it’s not comforting.  Attempting to capitalize on what is being labeled “populist” anger, he went on the stump this week and has started talking “tough”.  But, frankly, it sounds more like stupid to me.  He told George Stephanopoulos:

“The same thing that swept Scott Brown into office swept me into office.   People are angry, and they’re frustrated.  Not just because of what’s happened in the last year or two years, but what’s happened over the last eight years.”
 
Yo, put on some clothes, there, Emperor.  This time it really is all about you.  Those last “eight years” you continue to casually toss around as your sole reason d’etre now includes the first year of what sensible Americans have been praying is your own lame-duck presidency.  What happened in Massachusetts is, indeed, the sensible reaction of a free people to your lies and your ideology.  We were angry at the growing deficits and intrusions of the federal government in 2008 and we’re angry at the Obama-led Democrats’ neck-break race to socialism that continues to increase them now.
 
But no matter.  Obama got himself all wee-wee’d up and told a crowd in Elyria, Ohio (where unemployment is now at 10.9 percent — up from 10.6 last month):

“Now, we’ve gotten pretty far down the road, but I have to admit, we’ve run into a bit of a buzz saw along the way….”

“…I am not going to watch more people get crushed by costs, or denied the care they need by insurance company bureaucrats, or partisan politics, or special interest power in Washington.”

Astute observers will note that referring to a majority of the citizenry at large as a “buzz saw” when they disagree with him shows again this inexperienced bubble boy hasn’t a clue or, more likely based on other statements, just doesn’t care about the checks and balances foundation of government in this country that secures the power in the hands of the people.  And it is not only my jaded eyes that turn up at the corners from the humor of the blatant hypocrisy contained in his statements.  What we saw, particularly exposed during the month of December, made it quite clear that the Chicago machine of “partisan politics” and the “special interest power in Washington” was gunning at full throttle to create both the House and Senate versions of health care “reform”.  (Corn husk, anyone?)
 
This fighting stance continued as the ramifications of the Supreme Court decision on the upcoming 2010 Congressional mid-term elections quickly began to sink in.
 
 
 
Tip what?  Drown out what?  Certainly Massachusetts just proved the progressive liberal’s need to stifle free speech on behalf of those chosen to be their pet victim de jeur is not only wrong, but unnecessary.  Martha (“Curling Iron”) Coakley flew from Massachusetts to Washington, D.C. to attend a fundraiser for her Senate campaign, and both hosts and attendees included lobbyists for “Big Pharma” and the health care industry.  Monies raised were used for negative attack ads against Scott Brown, but we all know what happened next.  It didn’t work.  The American people knew what was at stake and threw their nickels and dimes at Scott Brown; and the good people of Massachusetts, equally tired of Washington’s special interests, raised their collective middle fingers and gave the Democrats and their lobbyists and their unions a loud and clear salute by sending Brown to Washington to kill the health care Senate bill.
 
It may be too difficult a concept for affirmatively-graduated Ivy League progressives, but it doesn’t take a rocket scientist to understand that freedom of speech is our most powerful means of controlling special interests and bringing hidden agendas to light.  So what if corporations or the unions now no longer need a middle man (in the form of PACs) to donate to a candidate or a cause?  The Supreme Court did not strike down disclosure and therefore any business that decides to spend their profits on campaigns that go against America’s liberties or against Her best interests will soon find their profits gone MIA as the people cast their votes not only at the ballot box but with their dollars.  Those companies who decide to try and hide behind PACs will continue to be outed by an newly-awakened citizenry who is sick and tired of lies, no matter what the source.  Where the agenda of unions goes against America’s sensibilities, they will lose even more members than they have to date.  Frankly, those who would want to pursue campaign reform in light of this ruling would do better to simply put more transparency into the whole process. 
 
But in a free market economy, advertising can be a form of corporate suicide and where campaign financing is concerned the left believes that this a bad thing.  What they can’t accept, because it threatens their power, is that real equality means the freedom to fail as well as the freedom to succeed.  It is not up to the government to selectively and partisanly choose who may speak and when.  At least it is not up to the government in these United States.  It is the kind of activity belongs in despot regimes like Venezuela, Cuba, and Iran.  That the Obama administration and its progressive liberal supporters are already seeing how to write new laws to corral free speech yet again is yet more straightforward evidence they do not accept the Constitution as it was written and sets the stage for the 2010 mid-term elections to be a bloodbath, ending with Democrats picking up their teeth with the stubs of their elbows.
 

Quote Of The Day

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Today’s pithy comment, courtesy of particpants on Ed Morrissey’s blog at HotAir about Ralph Nader announcing that we need to amend the 1st Amendment because of the Supreme Court ruling striking down parts of the McCain-Feingold campaign finance legislation.

Dear Ralph Nader,
GO TO HELL.

Sincerely, George Washington, Thomas Jefferson, James Madison, John Adams

cc:  King George III

Obama’s Waterloo Begins

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Yes, Mary Jo; there really is a Santa Claus.  He may be almost a month late, but he brought one hell of a present to not only the state of Massachusetts, but to all of America:  the “41st vote”, aka newly-elected United States Senator Scott Brown.

‘Tis another shot heard ’round the world.  How serendipitous that it has come from Massachusetts, the birth place of the American Revolution.

Dems Lose – No Matter What

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Today’s special election in Massachusetts is historical, yes, but even though there are still a few hours to go before the polls close today, a loser has emerged and I dare say it’s ranking at the bottom of the political landfill will be a long stay.

Watching how the campaigns are handling the fever-pitch race that is, effectively, a referendum on the Obama administration and the progressive liberal Democrat majority has laid bare one thing:  those liberal progressive Democrats are truly nasty, evil people and the unintended consequences of their actions over the last year is going to keep them in a world of hurt for a very, very long time.  There are endless reports coming in about campaign signs for Martha (“Curling Iron”) Coakley right at the doors of voting precincts (illegal within 150 feet of a precinct in Massachusetts).  There are losers hanging around precincts .  She has union members (from New York’s UFCW Local One, no less) manning one of her offices, kicking out a reporter and calling them a Nazi. 

By 3:45 p.m., the Massachusetts Secretary of State had received two separate reports of voters being given ballots already filled out for them.

 Then the markets closed higher today on hopes of a Scott Brown victory, which is hysterically funny when you remember that among the hosts of Coakley’s D.C. fundraiser last week were Eli Lilly (up 4.4percent at $37.41), Humana (up 7.1 percent at $51.94). 

And while His Transparency “was both surprised and frustrated” with what he apparently sees as needless fuss over Ded Ted’s replacement, White House press secretary Robert Gibbs, however inadvertently, actually called it correctly:  “In many ways we’re here because of that upset and anger.”

A Democratic Scholar’s Version Of History

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Speaking at a rally for Massachusetts senatorial candidate Martha Coakley last Friday, former president and Rhodes scholar Bill Clinton, said:

“I came here to tell the people of Massachusetts this:  This country’s revolution was born in Massachusetts.  The Revolutionary War was first won here.  The war was over here years before it was finally finished.  It started with the Boston Tea Party, and the right wing Republicans have appropriated that on the premise the tea party was against government.”
 
Clinton added, “What they were against was abuse of power.”

Perhaps distracted by someone in the audience wearing a blue dress, Clinton conveniently forgot that the American Revolution was against GOVERNMENT abuse of power.

But somehow I don’t think the American people, particularly those heading out to vote tomorrow in Massachusetts, have forgotten.

Quote Of The Day

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Gun Control: 

The theory that a woman found dead in an alley, raped and strangled with her own pantyhose, is somehow morally superior to a woman explaining to the police how her attacker got that fatal bullet wound.