Sentimental Value Is Not Lost on Us: What Does Your Insurance Company Do For You?

Recently We Received This Piece of Advertising Mail from a familiar source. In a previous era, we would not have thought much about it at all. But now that we all seem to be investors in this insurance company deemed to be absolutely essential to the well-being of the world financial markets, it was a hard advertising pitch to ignore.

“Sentimental Value is Not Lost on Us,” either. We never knew that $152,000,000,000 of our money could touch our hearts so deeply.

And As for the Big Question that that big, ol' sentimental insurance giant, AIG, asks us in that blue picture up at the top of the page—

Well, It May Be Best if we just keep our comments to ourselves.

Secretary Paulson Re-Strains Credulity

What in the World Can One Make of Treasury Secretary Henry Paulson? We mean this without rancor or sarcasm, and with all respect due to a member of the cabinet of a sitting president of the United States.

But What Can Anyone Make of It?

Back in September, Channeling Barack Obama™ addressed the confusion created when Secretary Paulson’s testimony before the Senate Banking Committee directly contradicted the contents of his short proposal for bailing out Wall Street. In that circumstance, the man said that his proposal did not try to prevent oversight of the Treasury Department. But the wording of the proposal clearly did just that.

See our previous posting, from 09/24/08, here:

“Treasury Testimony Baffles the Nation”

Either Secretary Paulson Lied, or he is incompetent at understanding the English language. (Which incompetence would beggar belief.)

Now Secretary Paulson, speaking yesterday before the House of Representatives, says that to use the Troubled Assets Relief Program (TARP) for limiting mortgage foreclosures “would violate the intent of the rescue approved by Congress.”

Congressman Barney Frank challenged Secretary Paulson on this statement, pointing to TARP language that allows Treasury to, “use loan guarantees and credit enhancements to facilitate loan modifications to prevent avoidable foreclosures.” [Source: The New York Times, 11/19/2008, p. A30]

So What’s Going On? Why does Secretary Paulson's testimony once-again seem to contradict the facts?

What Is the Difference Between capital injected into banks indirectly to encourage “loan guarantees and credit enhancements to facilitate loan modifications” and similar loan modifications made directly to homeowners to facilitate their staying in their homes and paying off their mortgages?

TARP Funds for Homeowners Rather Than to Banks

One Proposal for Mortgage Modifications would place a TARP agency in an intermediary position between homeowner and mortgage-holder. The agency would extend the term of the original mortgage to a greater length, lessening the homeowner’s monthly payments, while yielding a greater total payment over all. The agency would collect the homeowner’s monthly payment, add to it the difference between this payment and what the mortgage-holder gets, and make the full, original payment.

The Basic Premise Underlying this proposal is that, over time, the underlying value of the home will appreciate in value above what is owed, including any additional principal resulting from the TARP contribution. At sale or transfer, the American taxpayer is made whole—including a profit on the additional money.

This Proposal Allows More Americans to stay in their homes and protect their own financial interests, as well as those of the taxpayer.

The Fewer the Foreclosures, the higher the “floor” that is placed under the prices of American houses overall. Which leads to a shortening of the current economic recession and credit crisis.

How Does This Proposal Mesh with Secretary Paulson’s ideas for loaning funds to troubled banks, so that they in turn can buy up other distressed banks? Under the Paulson plan, housing prices will continue to go lower for quite a while, and it is the banks—not the risk-taking American taxpayers—who benefit the most from the taxpayers' risk.

We Are Looking for Some Guidance, some evidence of any kind, to show that current Secretary of the Treasury Henry Paulson is neither a flagrant liar nor a profoundly incompetent public servant.

Here, We Invite Secretary Paulson to contact us and explain the apparent discrepancies between his previous testimonies in relation to the Troubled Assets Relief Program:

Secretary Paulson, the Floor Is Yours.

And Regardless of Any Appearances to the Contrary, we appreciate your service efforts on behalf of the American people.

Style Over Substance: The Republican “Spread the Wealth” Plan

The Wall Street Rescue Plan Is the Republican Version of “Spread the Wealth.” The effects of the past twenty-eight years of Republican deregulation and Liberal-bashing have led to the greatest spreading of wealth in the Nation’s history. All 300,000,000 of us must “spread” our “wealth” to protect the McCain-named “greed and corruption on Wall Street.”

If “Spread the Wealth” Is Really the Republican Program, how can Senator McCain and Governor Palin get away with accusing Barack Obama? The answer is simple: it depends on John McCain’s sarcastic tone and Sarah Palin’s humorous barbs about “Joe the Plumber” and “Ed the Dairyman.” By pushing these false examples—of people who would actually gain in the wealth of Wall Street CEOs under an Obama plan—the Republican candidates exercise their own right to “Style Over Substance.”

“Style Over Substance” Is What the Republican Party Has Given Us for the Past Eight Years. Meanwhile, they have “spread the wealth” of middle-class American, to bailout the multimillionaires on Wall Street. $700,000,000,000 and counting: that’s how much taxpayer money the Republican “Spread the Wealth” plan has spread to rescue Wall Street. Where is the “trickle down” in that?

General Colin Powell Makes His Case for Barack Obama eloquently. While John McCain and Sarah Palin believe that being an Arab-American or a Muslim-American or a French-American or an American city dweller is a bad thing, Colin Powell points out the essential American point-of-view:

We Are All Americans. While Sarah Palin talks about “pro-America” parts of the country, nothing in the Barack Obama or Joe Biden record shows either leader categorically dismissing any American citizens as second-class.

“Style Over Substance”? “Second-Class Americans”? That’s the McCain-Palin approach, for which un-American positions they should be resolutely denied election to higher national office.

Style and Substance? That’s What Barack Obama Offers America throughout this long campaign and in presidential leadership to come. Now, early voting is begun in many states throughout the nation. One party in this election clearly seeks to represent all of America. We are one nation. United and indivisible.

Barack Obama and Joe Biden Ask for Your Vote. They need it now. America needs your vote now. It is time to show the “Spread the Wealth” Republicans that “Country First” means all the country. And “Hope” and “Change” represent the real American future, to end this long era that has put the failed policies of “Wall Street First” ahead of the safety and security of the greatest nation the world has ever known.


Thank You for Your Support

Vice-Presidential Debate Quiz, Part 2

[Our Series of Occasional Campaign Questions Continues:]

In 2003, Speaking on CNN, Senator McCain said:
“I Am a Deregulator. I Believe in Deregulation.”

Less than Two Weeks Ago on 60 Minutes, Senator McCain Said,
“I think the deregulation was probably helpful to the growth of our economy.”

Yesteryday Congress Voted Our $700 Billion Bailout of that same economy.

Democratic Vice-Presidential Candidate Joe Biden, speaking in last-Thursday’s debate, said that Senator McCain “recently wrote an article in a major magazine saying that he wants to do for the health care industry, deregulate it and let the free market move, like he did for the banking industry.”

QUESTION #3:
Should America Let Senator McCain Do for Health Care what he has done for the banking industry?

□ Yes
□ No
□ Now is not a good time to ask


QUESTION #4:
Would You Like the Arizona Senator to Deregulate Your Health Insurance?

□ Yes
□ No
□ I can’t afford health insurance


QUESTION #5:
If Senator McCain Ever Gets His Hands on Health Care, should the American people be expected to provide another $700 billion bailout?

□ Yes
□ No
□ Yesterday's bailout check hasn't yet cleared the bank



(Transcript source: http://www.cnn.com/2008/POLITICS/10/02/debate.transcript.
Italics in Govrenor Palin's comments are by Channeling Barack Obama™ )

NEWS FLASH! America’s Financial Crisis: Fortune 500 CEOs Respond

Channeling Barack Obama™ has received the following open letter to the American people:

Dear Fellow Americans:

We, the Undersigned CEOs of Companies on Fortune Magazine’s list of the 500 largest American companies, have stood quietly on the sidelines while Congress and the American people debate the solutions to the overwhelming crisis of our national economy. We understand that many citizens do not fully understand the exact nature the crisis, nor how we—each of whom makes a salary of tens of millions of dollars—screwed it up.

But That’s Just What We’ve Done. We’ve screwed it up.

And Now We Come to the American People with our hats in our hand. We need your help.

Treasury Secretary Henry Paulson, on Our Behalf, has asked Congress to put together a plan to take away the obstacles that are shutting down the credit markets and making it impossible for businesses to continue doing business, and for citizens to buy houses or cars, or to use credit cards.

If Congress Does Not Act—and Quickly—the entire credit system of the United States will stop. What we will have is a major disaster. And so we need Congress’s help, and the resources of the United States Treasury—which money ultimately belongs to you.

To Show Our Understanding of What the American Taxpayer Faces with such a large plan, we would like to make the following accommodation, out of respect for your great sacrifice:

Effective with the Signing of the Economic Rescue Package, we, the undersigned CEOs, will voluntarily reduce our own salaries to a number that is 14 times the average pay of each company’s salaried employees.

Whole Foods, Inc., the Nation’s Largest Organic-Grocery Market, has used this salary cap for years. It has served Whole Foods well. This cap serves as an ideal guideline for how American corporate leaders should be compensated in the future.

In the Meantime, All Salary Above This Cap, until our salaries are renegotiated, we will give to the United States Treasury, to be used as will best serve America’s financial needs right now.

America Is in Crisis. We, the undersigned CEOs, appreciate the willingness of the American people to step up. The extra millions of dollars that we CEOs have at our disposal are the least we can offer, in gratitude for the generosity of the American people.

To Our Fellow American Citizens, we say:

Thank you, and God Bless America.

(Signed)

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

_________________________ _________________________

Is Government Really the Problem?

Republicans Since the Days of Ronald Reagan have loudly insisted that “Government is not the solution. Government is the problem.”

With the Current Bailouts of the American Economy underway in Washington, it’s getting a little bit harder to make that sound convincing.

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, speaking urgently last week before the Senate Banking Committee about their Federal Bailout proposal, seem to believe that government actually may indeed have the solution to the current potential mortgage meltdown.

According to These Distinguished Republican Gentlemen, deregulation is the problem, government is the solution. And the time is now.

Government Can Be the Solution, even if the free-market Republicans want to deny it.

Presidential Candidate Barack Obama and Vice-Presidential Candidate Joe Biden ask for your vote on November 4th.

It's Time to Reinvest in the American Spirit.


Thank You For Your Support

A Man Rushes Out of a Burning Building.....

.....Carrying a Five-Gallon Can of Gasoline and a Lighted Match. He screams to the gathering crowd, “Quick! Quick! The barn is on fire! Everybody, quick! Give me all of your money so that I can go buy some water to put it out!”

Somebody Steps Forward and Asks, “But it's a fireproof barn. How can this be happening?”

The Man Shouts Backs, “Will nobody listen to reason? There's no time to waste! Hurry! Hurry! We've no time for mistakes!”

Someone Else Asks, “How about if we all bring our hoses and buckets out and put out the fire ourselves?”

“No, No, No!” Screams the Man. “I want to buy all your hoses and buckets. Then everybody turn around, and I'll put out the fire. But hurry! There's no time to waste!”

“But Why Should We Give You All Our Money, to buy our hoses and our buckets from us, so that you can go put out the fire......that you just started?”

Don't You Wish That All Analogies Were Better Than This One? The details don't match the current economic crisis facing the United States. And certainly neither Treasury Secretary Henry Paulson nor Federal Reserve Chairman Ben Bernanke created this "barn fire."

It Was “Free-Market” Ideology that failed in this situation. According to Republican testimony, the only way that Freddie Mac and Fannie Mae could get mortgages to poor people was to get rid of regulations that governed mortgages, and then sell to poor people mortgages that they could not afford.

Plenty of Ways Exist to Make Mortgages Available to low-income borrowers. But we took advantage of ignorance and greed, and put the entire American economy at risk.

As Chairman Bernanke Himself Has Not Said, “The American barn is on fire.” And we know who lit the match.

So Now What Do We Do?

What If We Guaranteed Troubled Mortgages by taking a shared equity position and extending the mortgage payments to compensate the Treasury's contribution? What could be simpler, and fairer both to the troubled homeowner and the underwriting American taxpayers?

Meanwhile, Back at the Burning Barn, government representatives of the folks that set the thing on fire are still out there, shouting:

“Hurry, Hurry, Hurry, Before the Barn Burns to the Ground, and There Is Nothing Left for Us to Sell.”

Treasury Testimony Baffles the Nation

In Secretary of the Treasury Henry Paulson's testimony before the Senate Banking Committee yesterday, he directly contradicted his “simple proposal”:

Secretary's Testimony Before the Senate Banking Committee on Tuesday:
“We gave you a simple, three-page legislative outline and I thought it would have been presumptuous for us on that outline to come up with an oversight mechanism.”

Secretary Paulson, Again in Yesterday's Testimony:
“If any of you [Senate Banking Committee members] felt that I didn’t believe that we needed oversight, I believe we need oversight. We need protection. We need transparency. I want it. We all want it.”

BUT:
Secretary Paulson’s Text of the Three-page Bailout Bill Presented on Friday, Just Four Days Earlier:

“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency...”

No Wonder So Many Americans Are Confused. What do we make of such contradictory statements? We don't like to believe that people lie, and yet such contradictory statements as Secretary Paulson made within a few days of each other represent either:

Lies or Senility or Merely Incompetence

How Can This Man Be Trusted? Whether the Secretary is senile or dishonest or merely incompetent, the contents of the United States Treasury should not be put at his disposal. We must not place our trust in this self-discrediting man.

Better Thinking Must Prevail. In terms of additional "bailouts" or other solutions to the current economic crisis, clearer thinking and more-responsible options must be examined—by more creditable people—and then pursued.

Congress Must Not Rushed Into Foolhardiness Yet Another Time.

As President Bush Himself Once Put It So Well, “Fool me once; shame on you. Fool me twice.....and you won't fool me again.”

In for a Penny, In for the Whole United States Treasury

At Least Federal Reserve Chairman Ben Bernanke had the decency today to say that he has made plenty of mistakes. Has anyone else in the Bush Administration ever apologized to the American people? Has anyone else in the Bush Administration said anything even close to this?

For the Rest of the Bush Administration, right now it's “Empty the rest of your wallets, step aside and shut up, or the whole ball of wax goes up in flames.” This may be as close to an apology as we citizens of the United States are likely to get. For any or all of these messes.

The Free-Market Ideology, the Great Experiment, is now the experiment that has failed. It has failed American Conservatives in particular, and it has failed the American people overall.

Over the Past Eight Years, We Have Seen what the decades-long dismantling of essential regulatory measures has done to the economy—from the savings and loan industry back in the 1980s, all the way through to the banking and mortgage and investment fiascoes of today.

President Bush’s Appointees, Treasury Secretary Henry Paulson and Fed Chairman Bernanke, offer absolutely no assurances as to why we should trust them now, in the face of their long series of failures. If a bailout is necessary, it seems prudent to look for someone different to give the thing a try.

It Is Common to Resist Changing Horses in the Middle of the Stream, even if the horse you’re on is crippled and drowning. That fear of changing “horses” is part of what re-elected President George W. Bush in 2004. As some Conservatives said, “He got us into it; he can get us out.”

Well, It Seems That This Horse Can’t Get Us Out, and indeed his people have continually made things worse. And now his people come to Congress, hat in hand, and beg for the American worker to bail the Wall Street bankers out.

Secretary Paulson Says That If We Try to Limit the Bailout, such as by asking for equity positions in the risky investments that we buy—or by limiting the multimillion-dollar CEO salaries of the companies involved—why, these firms—these CEOs—might just turn us down.

That’s Right: the CEOs of These Desperately Troubled Firms might just say to us, “Thanks....... But no thanks.”

And Then Where Would We Be?

If We All Go down the Financial Tubes Without Their Bailout, at least they won’t be taking $700,000,000,000 more of our money with them when we all go. At least they won't be “laughing all the way to the bank” without us.

The Good News: Exactly six weeks and counting until we vote the current, uh, Free-Market, Anti-Regulation Republicans out.

Citizen-Shareholder Bail-Out

[DISCLAIMER: The following post is not in any way associated with the Presidential campaign of Barack Obama and the Vice-Presidential campaign of Senator Joe Biden.]


The Proposal to Privatize Social Security made many Americans nervous. The current situation in the financial markets shows why. With the stock market down more than 25%, anyone relying entirely on investments for retirement right now would be facing hard times.

The Financial Institution Bail-Out Gives America a Unique Opportunity. As long as the American people are bailing out the mortgage companies—and the investment companies—and the banks—and the insurance companies—the right thing to do is to compensate the taxpayers for the risk that we are taking on. That’s why an Obama/Biden administration, once each of these companies has been restored to economic good health, can take the bold step of distributing stock shares of these companies to the citizen shareholders

President Barack Obama, if elected, can see to it that each American citizen receives an equal number of shares of stock in that company. Within a short time of balance being restored in the American financial markets, every single American will share in the benefits of stock ownership: regular dividends, as well as the value of the price increase of their shares.

Under an Obama “American Shareholder Plan,” each American will be able to sell his or her stock on the stock exchanges—or deposit it, tax-free, in their own private retirement account.

On Both Sides of the Political Divide, we say that we are eager to work together. Now, challenging times have shown us a way to make this a reality. We can bail out those troubled institutions whose failure threatens us all, while at the same time, we get compensation for the risk that we are taking in these bailouts.

It’s a Win/Win Situation. And under an Obama/Biden presidential administration, that’s the way it’s going to be.

One Nation, Indivisible, with Justice—
and Investments—for All!