The Perfect Storm

Rarely do you see The Daily Kos, Michelle Malkin, Red State, and U.S. News and World Report agree on something. So when all of these are arguing against a Democrat sponsored bailout of the International Monetary Fund (IMF), we should probably take a minute to hear them out.


This started with a commitment by President Obama to send $108 Billion to the IMF. Now Rahm Emanual and Nancy Pelosi are trying to bully House Democrats into voting for a war funding bill with an amendment attached to provide $108 Billion to bail out the International Monetary Fund. Nancy Pelosi wants Democrats to sneak this bailout through becuase no one believes a bill bailing out the IMF could make it on it's own. The American public has reached their limit of bailouts. Strategists on both sides are predicting losses for elected officials voting for bailouts in 2010.


The funny part is the coalition lining up to defeat this. Red State has listed the names and contact info for the Democrats most likely to be flipped. Eric at Red State is encouraging everyone to call them. Peter Roff writing at U.S. News and World Report has listed the top ten reasons to vote against this. The Daily Kos has gone so far as to write supportive profiles of Democrats likely to defeat those Democrats who might vote for this bill.


In this age of new politics, Republicans and Democrats can unite together to tell Rahm Emanuel and Nancy Pelosi Americans are tired of bailouts. We are tired of bailouts, and we don't want to bailout European banks. If Pelosi thinks this is important, let her put this bailout on a bill by itself. If she can't get the votes for it by iteslf, don't try to sneak it through.

Godfather Obama and the UAW

This past week has shown us that President Obama will do anything to protect the UAW. The President is willing to break the law, strong arm banks with TARP money, and use the "…full force of the White House press corp…" to destroy any dissent. The President isn't interested in doing what is right, or what is legal, but what protects the UAW.

As Chrysler heads into Bankruptcy court, we should all pay attention. GM (commonly referred to now as Government Motors) is likely to head the same way, and we may see more TARP companies or banks go into bankruptcy before it's all over. Whatever happens to Chrysler is going to set precedent for future bailouts and bankruptcy's.

President Obama attempted to force a bankruptcy down the throats of Chrysler's creditors that violated contracts those creditors had in place. He hasn't given up on this and is actively working on it. Secured creditors loaned money to Chrysler with a contract that stated if Chrysler sold off its assets, these secured creditors would be paid back, dollar for dollar, before any other creditor is paid back. President Obama is attempting to violate this contract simply because it suits his political will. He believes these creditors should only get 28 cents for every dollar they loaned Chrysler. The UAW would get 55% of the entire company.

In a related story, you may have read that some of the banks that received TARP money want to pay it back to the Government. President Obama won't let them. Why? The stated reason is that these banks need to pass a "stress test" to prove they are sound enough that they don't need the money. This is way above and beyond simply bailing out banks. When last I looked, President Obama has no experience running a bank, or a company. Who is he to decide when a bank can or can't pay back the money? More importantly, this money isn't the President's money. The money loaned to these banks, and to the auto industry, is tax payer money. The President is suppose to be a steward of the tax payer's money. Right now, he is failing at that job. Instead of protecting the tax payer, President Obama is controling these banks so they won't object to his version of Chrysler's bankruptcy. Imagine if President Bush, Vice President Cheney, and Karl Rove had cooked up a scheme like this...

Perhaps the most disturbing part of this entire story is the threat by President Obama to destroy Chrysler's creditors in the press if they don't submit to his will. This is the classic Chicago political move of "making them an offer they can't refuse". One creditor has gone on the record stating they were threatened by the White House. How many more creditor's have been threatened and are afraid of President Obama, Press Secretary Gibbs, and the Democratic PR machine? These thug style political manuevers got him elected in Chicago, and he is trying to use them to get what he wants now.

President Obama's tinkering with the auto industry threatens property and contract law in our nation. The precedent it starts is that if you have a contract, its only valid as long as the current President says so. This is not the way our government is allowed to operate under the U.S. Constitution.

There are a number of good articles covering this. I have provided links below to the most recent ones I have read.

The Big Business of Big Labor from the Washington Examiner

Chrysler Bankruptcy Exposes Dirty Politics from CBS News

An Offer You Can't Refuse by the Economist

If you think I am simply a crazy conservative, go read those three articles and see if you still think so.

Why I go to the Tea Parties

There have been a lot of comments on here and in an assortment of media outlets regarding the people who attend Tea Parties. Some of the worst comments are those like Jeanine Garofolo saying that Tea Party attendees are only protesting a black man being President. The racist comments are uncommon, but not as uncommon as they should be. What seems more prevalent is the belief that the Tea Parties are organized by Rush Limbaugh, Sean Hannity, Glenn Beck, and Fox News and that the goal is to overthrow the government. Anyone who says this hasn't spent any real time talking to those who attend the parties.

While kooks are often attracted to protests (both on the left and the right), the majority of people I have seen at the Tea Parties are there because they are upset by the spending going on in government right now. Many were mad at President Bush and the previous Congress for TARP and the bailouts of GM and Chrysler. They are also mad at President Obama and the current Congress for continuing these bailouts, and for the ever increasing budgets and spending programs. Many of the attendees realize there is no way to continue this level of spending without dramatically raising taxes on everyone. The chart below was published originally in the Washington Post, and has been researched and defended by the Heritage Foundation. It shows the deficit under President Bush and the projected deficit under President Obama.

Whether you believe the White House or the Congressional Budget Office, neither of the above estimates are good. The spending in Washington is way out of control. Every idea in Washington revolves around funding a program, spending money on research, or buying something. There are very few elected officials arguing to cut the budget, and not enough officials arguing to stop the bailouts (auto, credit, or bank). My biggest fear is that the bailouts are going to make things worse, not better. By propping up these industries, we are delaying the day they go through the reforms they need. As painful as those reforms are now, they are going to be much more painful down the road.

I go to the Tea Parties to protest the current levels of spending by our government. This includes President Obama's spending and Congresses spending. I am not there to protest just President Obama. If the protests were about Global Warming or some of the other silly idea's this administration has, I probably wouldn't attend. While these ideas are worthy of debate, and I do debate them here, they aren't as dangerous as the continued spending by Washington. If we continue on the pace the chart above shows, our economy is going to get so bad, cap and trade and national health care won't matter. I can't speak for everyone at the Tea Parties, only myself. I can say that many of the people that I have spoken with at these parties have the same concerns I do, and are worried about the same things. The Tax burden on the American Worker is already too high. Spending like we are seeing in Washington is going to make that tax burden much worse.

I also go to the Tea Parties because I don't believe it is the role of our government to do these things. I don't believe our government should bailout financial companies and car industries. I don't believe we should step in and fire private CEO's. I don't believe the government has a right to interfere in how business pays their employees. Every time the government interferes in these areas, all of our freedoms are diminished. Anytime the government is allowed to save a bank, or a car company, or to fire private employees, it represents a time when the government gets to take control of our lives. I think Americans would be much better off without the government telling them what to do. Do we need some boundaries for companies to operate within? Sure. Do we need the constant intervention created at the end of Bush's term and perpetuated under President Obama? Absolutely not.

As I said, I can't speak for every person at these Tea Parties. I can say most of them are every day Americans who work and send their kids to school. These Americans deserve our respect and they deserve to have their voice heard in Washington. I , and many of the Tea Party attendees, believe Republicans and Democrats have stopped listening to voters. That's not good for anyone.

This post was published at Tea Party Patriots and Political Friends.

I Support AIG Employees

“The vote by Congress to tax Wall Street bonuses out of existence was economic populism run amok. This was legislating by rage, fear, and panic.”

-New York Daily News Editorial

Yesterday was a dark day in the history of the U. S. Congress. Our Congress voted to write a law that would retro-actively attack a small group of private citizens. These are the very tactics our country fought against in the Revolutionary War. Our Founding Fathers specifically outlawed this behavior in the U. S. Constitution. The thugs in Congress have decided they don’t have to play by the rules of the Constitution (assuming any of them still know where to find it to read). Our Congress has ignored the example of Washington, Jefferson, and Adams, and instead have chosen the example of King George during the 1700’s. One Republican even joked that these employees should kill themselves. Every single Republican and Democrat that voted to tax AIG employees at 90% yesterday should be forced to leave in disgrace.

According to varying news accounts, AIG paid out some $165 million in bonuses to between 73 and 463 employees. Most stories report the 73 number; I have seen one that reported the 463 employees. Pelosi, Barney Frank, and Chris Dodd want these people burned at the stake in the public square. Why? Because they had a contract with AIG, and they were arrogant enough to believe their employer would honor it. The employees fulfilled their end of the bargain, and expected AIG to pay them for it. I don’t know how many of you go to work and give your employer the option of paying you. I expect to be paid when I go to work and I know Congress expects the taxpayer to pay them.

Pelosi and other Democrats have stoked popular anger to the point that AIG employees are receiving death threats. According to the International Herald Tribune, “The Connecticut Working Families party, which has support from organized labor, was planning a bus tour Saturday of A.I.G. executives’ homes, with a stop at the company’s Wilton office.” The Democratically controlled Congress and Senate, in conjunction with some Republicans, and with the approval of President Obama are trying to steal money from private citizens simply because they have stoked public opinion against these people. Our elected representatives should be ashamed of what they have done, and we as citizens should be embarrassed by their behavior. Should anything ill happen to these employees, the blood will be squarely on the hands of Pelosi, Frank, President Obama, and their partners in this, “…populism run amok.”

More Surprises from the "Stimulus" Package

If you are supporting the Democratic Spending Bill before the House and Senate, perhaps this paragraph from Bloomberg (authors Mark Pittman and Bob Ivry) will make you think twice:


The stimulus package the U.S. Congress is completing would raise the government’s commitment to solving the financial crisis to $9.7 trillion, enough to pay off more than 90 percent of the nation’s home mortgages.


I hope you read that very carefully. The money involved would pay off more than 90 percent of all home mortgages, not just troubled ones. I have written a number of times regarding the insane cost of these plans. However, another Bloomberg author has found another reason to oppose these plans. Betsy McCaughey explains that the stimulus package, as currently debated, will usher in a new world for you and your health care.


In her article, Mrs McCaughey references the exact page number each of these provisions are contained in. For brevity, I have not reproduced the page number. To start with, the stimulus package with digitize your medical records. This sounds innocent enough and is even billed as a way to save your life if you are traveling and need medical attention. The doctor will have access to your medical records via a federal website. Assuming you are confident these records are secure, and there can't be any breach at the federal level, we will continue on. If this worries you, don't read any more because the rest of this will terrify you.


Now that your medical records belong to the federal government, a new entity called "The National Coordinator of Health Information Technology" will begin reviewing your files and the treatment your doctor provides to ensure that your doctor is doing what the federal government deems appropriate. If your doctor isn't, and is trying to treat your specific circumstance, or is trying some sort of experimental treatment on you (even with your consent) then your doctor can face very serious repercussions. The exact language of the bill is vague on this, and will create a separate federal group to decide what that penalty is. According to Mrs. McCaughey, most of these recommendations are out of recent Health and Human Services nominee, and non-tax paying Democrat, Tom Daschle's book. In his book, Daschle says our health care should be more like Europeans. We should slow down the development of new drugs and experimental treatments because they simply cost to much. We should also be willing to accept "hopeless diagnosis". In laymen terms this means if it costs to much to keep you alive, the doctor shouldn't be doing it. To quote the article:


Daschle says health-care reform “will not be pain free.” Seniors should be more accepting of the conditions that come with age instead of treating them. That means the elderly will bear the brunt

Medicare now pays for treatments deemed safe and effective. The stimulus bill would change that and apply a cost- effectiveness standard set by the Federal Council (464).


If the stimulus package is signed into law, then a person and council named by the Democrats will decide what treatments you should or shouldn't receive, will be able to penalize your doctor or hospital for not following those treatments, and will decide how much it should cost to keep you or a loved one alive. If it costs too much you shouldn't get the treatment.


Consider this fact from Mrs. McCaughey: the bill provides more funding for these provisions than for the Army, Navy, Air Force, and Marince Corp combined.


You may believe this new Health Care system should be implemented. I think it will be a dark day in our country if it ever happens. I also believe our country could be permanently damaged by this. However, either way, it should outrage all Americans that the Democrats and President Obama are trying to sneak this in. This shows that Nancy Pelosi, Harry Reid, and Barack Obama know the American people will not support it. The Democrats control the House, the Senate, and the Presidency. If they really thought Americans wanted this, they would create a separate bill and pass it. The Republicans would be powerless to stop it.

I encourage you to contact your Senator and tell them to vote against this. Ask them to defend these Health Care provisions to you and explain why they support them. If you don't know their contact info, look it up here. Don't let them sneak in legislation that could affect how, and how long, you and your loved ones live.

No New Economic Stimulus Package

In a speech today, President Elect Obama tried to gain support for an almost $1 Trillion economic stimulus package. "I don't believe it's too late to change course, but it will be if we don't take dramatic action as soon as possible," Obama said. Writing on the Real Clear Politics Blog, Marie Cocco argued against tax cuts in the new package, but also noted, "Without question, a large and quick stimulus is urgently needed." I wish to question the need for a government bailout that adds more money to the insane amount we have already wasted in hopes that something new will happen.

According to CNN Money, the United States allotted $7.2 Trillion in rescue funds for the failing economy during 2008. As of December 2008, $2.7 Trillion had already been spent, and the economy doesn't look any better today. These numbers don't include the FDIC Temporary Liquidity Guarantee Program. This program has an unlimited budget, and it is unknown how much it has spent. We have already spent Trillions of dollars and we have allocated Trillions more, and now the President Elect wishes to spend another Trillion. The President Elect intends to spend a portion of this money on alternative energy, updating federal buildings, converting paper medical records to an electronic format, expanding broadband networks, and updating schools and universities. All of those are separate issues that are worthy of their own debate. None of them are going to spur our economy.

We have heard a lot about the infrastructure spending in the new economic stimulus package. Some states are planning their own infrastructure packages. None of our elected officials have bothered to look at Japan's economic infrastructure spending. The Heritage Foundation notes that from 1992 to 2000, Japan took the road most of our elected officials want the United States to take. The massive increase in government spending on infrastructure has caused Japans per capita gross national income to fall to 74 % of that of the United States. The Heritage Foundation notes that between 1992 and 2007 the Japanese economy was almost flat. Yet we are now expected to spend more money than the Japanese while not having the same terrible results.

"We have to do something!" seems to be the motto of today's politician. In any situation there is always the "do nothing" approach. Perhaps the U.S. government should simply get out of the bailout business and let our businesses solve these problems for themselves. Some will fail, others will succeed. That is the nature of a free market. People and business should be allowed to succeed or fail based on their own efforts, not the will of the government. Massive Government spending didn't help the Great Depression, and it won't help our economy either.

Should We Trust Democrats with Cars?

The Democrats in Congress and President Bush have been working on a bailout for GM, Ford, and Chrysler. Many of the arguments that have been used to justify this bailout were the same arguments used to justify the $700 Billion bailout of the banks and home lenders. That bailout passed, but we have seen an increase in the percentage of home's being foreclosed on. In the last few weeks it was revealed that even while the Executive and Legislative branches were hammering out a bailout, Secretary Paulson was intending to use the money in different ways than what we were told he would use it for. Congress set up an oversight group to keep an eye on how the money was spent. However, as of this writing, Congress and the President have yet to name any members to the board. With this in mind, is there any reason we should trust the government to pass emergency legislation to bail out the auto industry? Is there any reason we should trust a Democratic Party majority to try and bail out the auto industry?

If we examine the beliefs and goals of the Democratic Party they don't match up well with the interests of auto companies. The Democratic Party believes in man made global warming. They believe it is the crisis of our time. They also believe using oil and gasoline are bad. How many times have they campaigned on taxing big oil? The DNC is the party of the Unions. While Unions aren't the only reason GM, Ford, and Chrysler are in trouble, they are a big reason. No one has ever accused unions of being "pro-industry". Why would they start now? Looking at the planks to the DNC one would question why they would want the big three to survive.

The Democratic Party was trying to force the auto industry to drop lawsuits against California's fuel regulations as part of any bailout. The Democrats in Congress are still trying to force "greener" cars on the auto industry while preventing them from bringing the higher fuel economy vehicles they make overseas into the United States. Why? Because Democrats want the environmentalist and the union members happy with the party. They have never really cared how the auto companies might fare with their laws. Why should they start now?

If Congress really wanted to save Detroit, there are other more meaningful ways of doing it. They could do away with the CAFÉ standards. They could lower taxes in general on both industry and workers. They could allow Detroit to bring in the vehicles they make in Europe. I believe any sort of loan is just going to delay bankruptcy by these auto companies. Perhaps other solutions might work. But either way, why would we expect Democrats to help the auto companies?

Quick Notes -- Holiday's & Bailouts

Welcome to another edition of Quick Notes. I am sorry for the lack of posts over the last week or so. The holiday and the job that keeps the roof over my families head have kept me busy. I was able to catch my breath for a minute or two today, and I thought I would spend some time with my readers. Let the Quick Notes begin!

Bailouts -- The Big Three auto exec's are heading back to Congress to beg for money. Instead of private jets, they are driving hybrids this time. I still believe that it would be a terrible idea to give these companies the billions they are asking for. If the government bails them out, they won't make any of the changes they need to make to stay in business. These companies didn't suddenly discover they were out of money. This has been coming for a long time. If we bail them out, it will only delay the end. These companies have made some pretty big mistakes to get to this point. They, and not the taxpayers, need to fix those mistakes.

The conventional wisdom seems to be that a new Congress working with President Elect Obama will give the auto executives the loans they are looking for. However, most people believe these loans will come with strings. GM, Ford, and Chrysler will be forced to make more hybrids and more "green" auto's in order to get the money. Hybrids and green technology isn't going to pull these companies back from the brink of bankruptcy. It may be that nothing will save these companies. However, Toyota, Kia, and other foreign companies are making and selling cars in the United States. Maybe Ford, GM, and Chrysler should leave Congress alone and research what the other car companies are doing right.

State Government Bailouts -- The Governors of 48 states have now gotten into the bailout act. They met with President Elect Obama today to discuss a bailout package for state governments. Many of the governors are trying to avoid the term "bailout". Instead, they are asking for a "$100 billion aid package" to go with a purposed $136 billion infrastructure package. I believe Congress, Obama, and many states governors hope that we can throw money at the recession and it will go away.


California represents about half of the total projected budget shortfalls that 31 of the states are facing. California, and many of the other states, should examine their current budgets. Dump the items that aren't critical and then reevaluate your budget. Tough times require tough decisions. Governors are elected to make those tough decisions, not pass the buck to someone else.

Of Cars and Bailouts

I once heard Joss Whedon discuss the themes of his Buffy the Vampire Slayer series. He said that the one lesson he tried to explore through the entire series was that our choices have consequences. This is a lesson managers of GM, Ford, and Chrysler, as well as Congress and the UAW would do well to learn. Upper Management at GM, Ford, Chrysler, and the UAW are all begging Congress for a bailout. They are looking for a loan of around $50 Billion in addition to the $25 Billion Congress has already made available for them in the form of loans for changing equipment at their factories.

I own a GM vehicle. Today I received an email from GM asking me to contact my representatives and ask them to vote for a bailout package for the auto industry. It is important to point out, there are a number of car manufacturers here in the United States that aren't looking for a hand out, and don't want their competitors getting tax money these better run factories have paid to the government. I think they have a good point.

GM, Ford, and Chrysler aren't looking to change their practices. They are looking for free money. Imagine if a company came to your house one night and asked to borrow money from you because they were on hard times. The company had a history of not turning a profit, said it stood behind its management team and their decisions, insisted on making no major changes to their operations, and wanted you to give them $75 Billion to let them keep their doors open for a few months. What would you say?

Some have argued that the big three are in this situation because of the Unions. I agree that the UAW has some share of the blame, but so does Congress, and the car manufacturers themselves. Congress has long believed they are automotive engineers and have mandated an assortment of standards that they themselves probably can't explain how to obtain. Congress is good at throwing money at problems, but not so good at coming up with real solutions.

George Will points out today that there is a very good solution for these automakers: Bankruptcy. The companies would be forced to restructure and reorganize. They would be able to renegotiate the bad contracts they have currently have with labor. As Mr. Will points out people who have retired from these companies, but are too young for Medicare, might lose their health insurance. That is OK. If they are that young, they can probably find new work. Some argue these automakers are too big to fail. Mr. Will points out they have already failed. The thing to do now is to see if the auto makers can restructure their company for success.

Throwing More Money Away

As our government continues to spend money like it grows on trees, I continue to believe that our elected officials have no idea what they are doing. Pelosi, Reid, Obama, and many Republicans seem to believe if the government throws enough money at a problem the problem will suddenly be solved. They aren't changing any of the laws that got us into this crisis, and they aren't asking business to change any of the practices that got them into this problem either.

The latest chapter in this tragedy started playing today. Treasury Secretary Paulson today said that the original, authorized, use of the $700 Billion bailout wasn't working fast enough. No the Treasury Secretary is going to focus on, "…direct capital injections into the struggling financial firms." The government is just going to buy pieces of these firms. This is the same Federal Reserve that refuses to identify how it has spent $2 Trillion in emergency loans already. Does anyone really feel comfortable with our government spending this money as fast as it can without any real accountability? The government does two things well: make war and waste money.

Today I saw an article where a number of different industries are going after the big bailout. The automakers are getting the biggest play on the news, but other groups like credit card companies, auto dealers, boat dealers, and several Hispanic business groups. The Hispanic business groups want to manage the homes the government might own as a part of this bail out. Pelosi and Reid are talking about using part of the bill for the auto industry, and there are signs the details of qualifying for help under the bailout may change under an Obama administration. This coupled with Paulson's desire to spend the money in a different way is probably the worst thing our government can do right now. They are creating more uncertainty. The Great Depression went on as long as it did because business had no idea what FDR was going to do next.

So far, there have been no talk of changing any of the practices that got us here, or making any changes in the way our government does business with financial institutions. If we really want to improve the economy, the government will stop issuing bailouts, and start cutting taxes. We will stop adding clauses and requirements to the auto industry, and start cutting the requirements we have on their manufacturing.

There is some small hope. Some Republicans are against more bailouts. Richard Shelby (Republican Senator from Alabama) has said, "I do not support the use of U. S. Taxpayer dollars to reward the mismanagement of Detroit-based auto manufacturers…" Amen.