Merely two weeks after Ben Bernanke announced one more round of quantitative easing (QE3), the results are already becoming apparent. And once again, it shows how the culture of “too big to fail” is both immoral and economically devastating.
The immorality of QE3 can be summarized by this quote, from Businessweek: “It’s very good to be a mortgage originator right now,”
Gosh, I wonder why? Is it perhaps because QE3 is benefiting banks/bankers…to the detriment of everyone else? But I thought our president wanted the top 1% to “pay their fair share”! So how do bankers and loan originators end up cashing in on yet another bailout? Yes, I realize I shouldn’t be shocked by a politician saying one thing…and doing the opposite. But I am.
Since images often speak louder than words, here’s an illustration of why it’s “…very good to be a mortgage originator right now”.
This is what Bernanke imagines QE3 is doing:
And here is what is ACTUALLY happening:
I rest my case.
An article from Suffolk, VA came to my attention on my Facebook page this weekend. It was about how Supplemental Nutritional Assistance Program (SNAP) aka food stamp use has nearly doubled in that area since the beginning of the economic downtown in 2007. We also had announced last week that the US Department of Agriculture was recommending “food stamp parties” to target seniors into enrolling in the program.
“Throw a Great Party. Host social events where people mix and mingle,” the agency advises. “Make it fun by having activities, games, food, and entertainment, and provide information about SNAP. Putting SNAP information in a game format like BINGO, crossword puzzles, or even a ‘true/false’ quiz is fun and helps get your message across in a memorable way.”
This “food stamp party” idea is an addition to other advertising campaigns going on across the country to increase enrollment. The results of this advertising have been very clear:
In the 1970s, one out of every 50 Americans was on food stamps. Today one our of every seven receive the benefit. After the recession, the ratio is expected to hover around one out of every nine, according to the Congressional Budget Office.
The USDA even promotes the food stamp program as economic stimulus:
It’s official: the New York Times’ resident Nobel Prize Laureate/Loony is delusional. He wrote on his blog Monday about “how right he was”:
We’re coming up on the second anniversary of my piece “Myths of Austerity“, in which I tried to knock down the simply insane conventional wisdom then gelling among Very Serious People. Intellectually it was, I think I can say without false modesty, a huge win; I (and those of like mind) have been right about everything.
But I had no success in deflecting the terrible wrong turn in policy. Moreover, as far as I can tell none of the people responsible for that wrong turn has paid any price, not even in reputation; they’re still regarded as Very Serious, treated with great deference. And the political tendency behind that terrible economic analysis has at least a 50% chance of triumphing in America.
“Oh well” is right.
His first problem is that he says he has “been right about everything.” When one looks at the stimulus programs that have been enacted since this recession began, and the high unemployment that has persisted, the evidence is blatantly clear: Krugman is an idiot.
His second problem is his statement that “I had no success in deflecting the terrible wrong turn in policy.” Um, lest I am living on a different worldline than Krugman, the man’s main policy prescription has been stimulus, and we’ve had a lot of it:
Phil Kerpen is president of American Commitment, a columnist on Fox News Opinion, chairman of the Internet Freedom Coalition, and author of Democracy Denied: How Obama is Ignoring You and Bypassing Congress to Radically Transform America - and How to Stop Him.
The Hill newspaper named Mr. Kerpen a “Top Grassroots Lobbyist” in 2011. His op-eds have run in newspapers across the country and he is a frequent radio and television commentator on economic growth issues.
Prior to joining American Commitment, Kerpen served as vice president for policy at Americans for Prosperity. He also previously worked as an analyst and researcher for the Free Enterprise Fund, the Club for Growth, and the Cato Institute.
Kerpen blasts out spirited, pro-liberty tweets @Kerpen.
What all the GOP candidates are after, are so-called ‘delegates.’Elected officials that will broker the convention of either party this fall. Officials are parcelled by the amount of votes, the candidates receive in the primary.
During Michigan’s primary recently, for instance, there were 30 official delegates, state-wide. Two were ‘at-large’ candidates, which meant they could be assigned individually to any winning candidate. The other 28 were ‘proportional’ ones, alotted through 14 congressional districts. During the push for the nominations in Michigan last night, Mitt Romney and Rick Santorum spent millions of dollars to influence the voting population; with TV ads, pamphlets, media, interviews, rallies, stickers, and much more. Michigan’s grand sum of politcal expenditure was near six million bucks.
Delegates are what really counts at the GOP convention. What looks to be happening, is that no clear winner will come out victorious. There’s a righteous number: 1444 delegates will win any nominee the victory-nod of the Republican National Committee. Nationwide, 2169 delegates are extended for contestation, until the RNC celebration in Tampa, Florida. From the RN Committee, an additional 117 delegates are added into the mix, ostensibly to keep debate lively and clear-up dead locks. So what appears, on first looks, to be a rather hot-headed and fast paced Republican rocket-launch to the RNC, is more like a jammed or misfired pistol in a duel.
Momentarily, Mitt Romney is in the lead, with 167 total delegates. Rick Santorum is second with roughly half, at 87. Newt Gingrich won only one state and has 32, while Ron Paul has 19 carefully collected delegations. The count may reshuffle at any moment, since constitutionalism and populism together, ring alarm-bells in states such as Arkansas, Kentucky, Tennessee, Texas, Oklahoma and New Mexico.
It’s not often that the media give Ronald Paul (R-Texas) a chance to speak.
There were reasons, why I didn’t watch the second GOP debate on Sunday.
Ronald Paul cleared the field on Saturday, he was the last man standing! After some initial tampering with his microphone, and pitch, he opened his arguments by restating his offensive tactic on “big-government Republican”, Rick Santorum. The only two real Tea Party contenders: Ronald Paul and Rick Perry, were left to languish on stage for the better part of 15 minutes, until allowed to join the discussion.
Mitt Romney was busy arguing how many jobs were, lost and gained under his CEO leisure. Newt Gingrich quoted the New York Times. Paul smoothly stepped back, blocked Santorum’s smugness by raining down: “he voted to raise the debt [ceiling] five times.”
Rick Santorum let loose liberal counter-attacks, naming sources “leftist”, and calling Mitt Romney class-consciously dangerous. In so doing, Santorum looked less Republican, more like a blue-state lawyer from the Northeast. Neither Paul nor Romney delved deep into his attacks, mostly picking up on their own strengths. Santorum was a negative force, not a positivist in this debate, Saturday night January 7th.
When Ronald Paul raised his hand for a response, the slick Stephonopilis retorted back to Paul (his senior by quite a few years): “we’ll stay with the subject, don’t you worry.” Brilliance in public debate rarely comes to the fore, especially on television. Paul showed it by counterstriking first Santorum, then defecting the attack from Rick Perry, onto Santorum and Newt Gingrich.
Jon Huntsman decided not to attack. Mitt Romney largely left the debate unscathed. Only because Ronald Paul made no concerted effort to attack the former Massachusetts blue-state Governor. It was easy for Paul to slice-down the cryptic schizophrenity of Gingrich, whose attempted slur of Ronald Paul on “style”, many see as hearnestness.
Everyone seems to be proposing fixes for our country lately, whether it’s amendments to repeal the First Amendment or ban gays or whatever. I have a few ideas of my own that I think will go a long ways towards restoring some sanity in government and fixing what’s wrong with our society. Some of these will require constitutional amendments, and I don’t expect the entire list to actually get enacted unless magic somehow returns to the world and we resurrect Barry Goldwater, F.A. Hayek, and George Washington all at once.
I originally drafted a list of some 23 ideas, but I figured that it would be way too long for a blog post, so I shortened it to 14, a baker’s dozen. None of these are simple or light fixes, they are not tweaking around the edges to ensure a marginally better outcome. Judging from the situation our government and economy is in, from the horrific hard place our civil liberties are wedged behind, and the unmanageable mess that is Washington, I don’t think that “moderate” or “conservative” changes will do anything. We cannot pussyfoot around the issue; we need radical alterations to how our government works if we’re going to get us out of this morass. Again, most of these may never pass, but that’s to be expected.
Certainly, if you wish to hear my entire list, let me know and I’ll write it up, but for now, here are my 14 ideas for fixing our country:
1. Establish Approval Voting
I’ve already talked about this idea at length here, so I will not bore you again. In this post, all I will say is that I believe if we are to get anything done—and I do mean anything—we need to systematically reform how people actually get into office. That’s the foundation upon which any democracy stands, and when you’re up to your eyeballs in tar, the only way to get that fixed is to drain the swamp and start at the beginning.
Rick Perry, looking to get back on top of the GOP primary, has unveiled a new reform plan that will “uproot, tear down and rebuild Washington, D.C. and our federal institutions,” as he puts it:
Blasting the congressional “creatures of Washington” for being overpaid and detached from the struggles of the people outside the Beltway, Texas Gov. and GOP presidential hopeful Rick Perry vowed Tuesday to eliminate federal agencies, set term limits for federal judges and push for a part-time Congress where both members’ pay and office budgets are sliced in half.
The three-term governor, speaking on a campaign swing in Bettendorf, Iowa, said he would lead by example by cutting his salary as president until the federal budget is balanced, and said that lawmakers who use information to profit from stock trades should go to jail — in what appeared to be a clear reference to recent news reports alleging insider trading involving House Minority Leader Nancy Pelosi.
“I do not believe Washington needs a new coat of paint, it needs a complete overhaul,” Mr. Perry said, according to prepared remarks. “We need to uproot, tear down and rebuild Washington, D.C. and our federal institutions.”
I’m reading his actual plan right here, and I have to say, there are some good ideas here, and one very bad one.
Everyone else has already said my thoughts on this OWS silliness. There is only one small part of it I want to comment on, brought to my attention by George Scoville:
With much of the nation’s attention on Occupy Wall Street and the protests that have sprung up around the country, one group taking notice is landlords responsible for the spaces where the protests happen, The New York Observer reports.
Some would like police assistance in moving the protestors out, as the Wall Street Journal noted, while others want to use the event to change the rules so that owners are given more leeway.
Privately owned public spaces, or POPS, are part of New York’s incentive zoning program, under which buildings are granted additional floor area or related waivers in exchange for providing these spaces. Zucotti Park in Manhattan is one such location.
Brookfield Properties, which owns Zucotti Park, pointed out that the plaza there hasn’t been power washed since the day before the protests began, nearly four weeks ago, the Observer reported.
The Real Estate Board of New York’s president, Stephen Spinola, told The Observer that his trade association may consider asking the Department of City Planning for new rules on the city’s POPS, perhaps allowing the private owners to close the spaces at a set time, which, he claims, would add to security and allow maintenance.
Not washed? Ewww.
Federal Reserve Chairman Ben Bernanke just announced Operation Twist, a new combat operation that will supposedly fix our market woes. Supposedly. (Hey, pass the vodka, will you? I need a drink before I listen to this guy.)
I am not a financial markets expert, and I have not heard that much on the actual details of Operation Twist, but, courtesy of CNN, here’s a brief explanation:
NEW YORK (CNNMoney) — The Federal Reserve announced “Operation Twist” Wednesday, a widely expected stimulus move reviving a policy from the 1960s.
The policy involves selling $400 billion in short-term Treasuries in exchange for the same amount of longer-term bonds, starting in October and ending in June 2012.
While the move does not mean the Fed will pump additional money into the economy, it is designed to lower yields on long-term bonds, while keeping short-term rates little changed.
The intent is to thereby push down interest rates on everything from mortgages to business loans, giving consumers and companies an additional incentive to borrow and spend money.
So basically, they’re selling bonds and buying bonds. Nothing exactly Earth shattering here. And definitely not anything that will get us out of this rut.
Interestingly, some members of the FOMC agree with my assessment, and one of them had a speech about it. Mr. Richard W. Fisher, president and CEO of the Federal Reserve Bank of Dallas, had this to say about recent monetary policy, using a Nordic weather station as a metaphor: