So What Now AIG?

Image via Wikipedia

• Yes, I did hear most of Liddy's testimony, and I did hear the insistence that these were contracts. So, I ask: if AIG was left to go completely bust, what money would have paid the policyholders? Are those not contracts? Or is it because those contracts are with mere mortals they are somehow less important that those of the financial wizards? Because, taxpayers buy into protecting policyholders - that was the point of the bailout, or so we thought because so we were told. Taxpayers do not buy into big salaries, and cannot comprehend "bonuses" in this context.
  

• Yes, I did hear Senator Dodd say he was the one to allow the bonuses because it was a compromise with the Treasury Department. So I ask, who in the Treasury Department? And did that "who" act alone? Specifically, where was Tim Geithner? Don't these meetings have minutes? I hear the Fed knew? Which Fed? Tim Geithner's New York Fed that he was president of at the time?

• Yes, I did hear Congress up in arms. But I ask: Don't you read every line before you vote on it? I imagine given the public outcry surrounded this legislation, and Paulson's attempt to have no review, no oversight and unlimited power in the first draft that it might, just might, have been a good idea to read every word before you voted on it?

• Yes, I did hear the Republican members of Congress try to blame this Administration. So I ask: Which Administration presided over the free for all that created this mess? Wasn't the last President a Republican? Now I agree: please use conditions to try to do what you can. But when the horse is out of the gate, and the Republicans opened the gate and egged on the horse to move as fast as he can, can the Republicans really complain about the gate and the horse now?

• Yes, I did hear President Obama. And without being biased, he's really the one who's the most correct. He didn't sign those contracts, but he takes responsibility. Translation - ok, now that we know, prepare for strict rules and regulations. And then at his Town Hall at Costa Mesa he did a fantastic job of explaining this mess in plain english - you know, the language that us mere mortals speak - and why it has to be fixed. When I find the video, I will be sure to post it.

So where are we?

Well, Liddy has said he has asked for a portion of the bonuses to be returned, and we hear that some people are returning all of the bonus. I commend them for that.

For those who do not want to return any portion of the bonuses, and are really content with Congress taking up time tomorrow for the House to try to tax 90% of these bonuses, and the Senate to try to tax 70% of these bonuses, I humbly submit that you are making matters worse for yourselves, your professional future, and your own profession. Frankly, Congress has lots of work to do to fix the economy that all these exotic products destroyed. It doesn't really have the time to do something it really does not want to do ideologically - and that is impose taxes of this magnitude. Shockingly, neither party wants to do this ideologically. But they will.

Respectfully, you bonus recipients are missing the entire forest for the trees. When the Government gets "tax happy" - watch out!

If this wasn't so important, and so sad, this would be a real soap opera.

Dear President Obama: Can I Be Your Commerce Secretary?

Image via Wikipedia

Ok, so I'm not serious.

But I am seriously concerned about the fact that there is no Commerce Secretary after two tries. Bill Richardson had what we will call a "personal problem", and now Judd Gregg is having what's appears to be some version of a "conscience problem".

If you have followed this blog, you may have noted the post I dedicated to the announcement of the nomination of Bill Richardson - The Richardson Promotion. I invite you to have another look at it to see why I thought the job is so important today. It may not have been really important in the past, but in today's world it is getting more important by the second. In a nutshell, the Commerce Department exists to "promote, foster and develop the foreign and domestic commerce". With borders closing and joblessness rising in the US and worldwide, sounds like a pretty important job to me.

So President Obama, since you have not yet found a third candidate, let me volunteer. Here's why I'm asking to be your Commerce Secretary:

• I believe in realism and have limited patience for ideology. In fact, I'm getting allergic to ideology. Here's how I see the world: What is the problem? What are the options? What are the constraints? What is the best solution given the constraints? When are we going to do it? Haven't we fixed it yet?? Hmnnn.....no questioning ideology there.

• I believe even one more job is better than nothing. The more jobs the better. The faster we get the jobs the better. I do not support and cannot understand the school of thought that joblessness is not a monumental problem. The cost to society cannot be overstated. So, the stimulus bill that creates jobs - doesn't matter how much or what else is in it - is good enough for me as long as there are no constitutional violations

• I believe that immediate relief is critical or the economy will become paralyzed. People without jobs become desperate and filled with despair. People with jobs just waiting for the "bad" to become" worse" are unproductive. A stimulus bill that provides immediate relief is good enough for me - as long as there are no constitutional violations.

• States and infrastructure must get assistance to ensure that goods are produced and transported within the US and inside and outside the country. A stimulus bill that provides some form of assistance to states and infrastructure is good enough for me - as long as there are no constitutional violations.

• I believe in getting along with the world, and interacting with other countries and cultures on a basis of mutual respect. C'mon, I grew up in Jamaica - we have no external enemies. We get along with everybody.
  

• I believe in sustainable fair trade. Exploiting others is not only immoral, it only leads to diminished markets in the long term. Mutual opportunities for growth is the best way to proceed.

• I believe that commerce can be a valuable tool for peace because prosperous people would rather go on with their lives as they see fit as long as they can afford it, rather than live in fear and terror.

• I believe that the private sector is THE engine of growth. I did go to business school - twice (undergraduate and graduate). But I do believe that the Government must provide limited interventions where necessary, and more interventions if warranted to prevent complete market seizure or economic collapse. How long have we been talking about market seizure and economic collapse? And who was in power when the downward spiral started? Why Republicans are not in favor of Government interventions so that the private sector can quickly get back to its position of being THE engine of growth is just beyond my comprehension. Oh, wait - that would involve me taking time to debate ideology and we are just about running out of time for that luxury.
  

• I am excited beyond words at the prospects of change and transformation to a green economy. Hey, two degrees in the environment and being raised in a gorgeous tropical island - what else do you expect? I know the green revolution is a "need to have"; it is not a "nice to have"

So, that's why I would want to be considered. But, since I can't be considered - could we have someone who thinks like I do, or is that asking too much? :)

Obama On Banking Crisis: We Can't "Prolong The Agony"

Image by Mimi_K via Flickr

Well, it doesn't get much clearer than that.

And is that what they want to hear? I think not.

Is it what has to be done? I think so.

So, let's get on with it.
Read the Article at HuffingtonPost

Memo To Congess: Did You Catch This Bit Of News?

Image via Wikipedia

The Wall Street Journal ran an interesting article today. Although the title, says it all - the article itself is well worth reading. Nations Rush To Establish New Barriers To Trade

• Maybe it was the sheer number of countries reportedly erecting trade barriers
  
• Maybe it was the countries in particular that were reportedly erecting trade barriers
  
• Or maybe it was the special meeting the WTO feels it needs to have on Monday. Yes, this coming Monday.

Now, I have often criticized globalization. But I am not anti-globalization. Rather, I am pro-globalization that is fair and sustainable.

So now, we have a position of hostility developing. Is this supposed to be progress? Because I am not getting that impression.

So since the crash in September 2008, let's do an ideological check:

• Capitalism took a major hit - some say permanent, others say altered

• Democracy looked dicey when the Republican party had not one but two internal party revolts when it was in power. And, by the way, Democracy's not looking so great now with all this bickering and inability to find a compromise

• And now, Globalization is on thinner ice than it was before

And by the way, aren't these all the bedrock of American foreign policy?

So here's my question for the Republicans. Is it the tax cuts they are holding out for? Because, frankly if something does not happen ASAP, I really don't see the point of them.

• Because businesses have to sell and trade and have markets to make money to even have money to pay taxes. Barriers to trade make that kind of difficult

• And oh yes, business do need inputs, right? So, what happens when those prices go up because everybody is seeing who can erect the most barriers?

• And one more thing, when was the last time you looked at the data from the US Department of Commerce - the US depends on the world quite a bit.

Again, every time there is a delay the cost goes up. There has to be spending. There's no avoiding it. But why make the tag higher than it needs to be? No trade or limited trade or difficult trade means money has to come from somewhere. That's State Subsidization. And that ideology is somewhere along the lines of Socialism. And which party would honestly be responsible?

Ironic, isn't it?

Congress, if you missed that WSJ article, may I humbly suggest that you have a quick look at it?

Is America no longer at war? Did I miss the announcement?

Image by CS Muncy via Flickr

No, really? Is America still fighting a war in two countries, and fighting terror and facing international threats? That must be all over because I can see no other reason for this incessant delay in passing the stimulus bill.

Look, I get politics and politicians. I had the privilege of serving in the Senate. I understand the need, and the responsibility more importantly to be heard and to speak up. Making law is an extremely serious responsibility that can make or break a person's life, and an entire society. I understand the need to represent your constituents. But what is going on? Is this really what you are all doing?

Honestly, I am lost. Last I heard, America was at war. Economic instability cannot be helping your military strength. You need money to fight, and economic power to negotiate. If you have economic stability in a global interconnected world, there is more incentive to find peaceful solutions since all countries have a vested interest in find opportunities for their own economies to grow - i.e., markets and people who can afford to consume their goods and services. Maybe you don't remember when the world was more polarized and we were not so interconnected - when people did not see advantages of trade. Do you remember what they did? They just preferred to conquer.

I thought the internal bickering stops at the water's edge. I thought the country was united in the face of a foreign threat. Does no one make the connection between economic stability and ability to defend themselves?

You know what the problem is? Job security. Yes, the people with the power to pass the stimulus bill have job security. Unless there is a revolution, or they are found to be corrupt, they cannot be removed. They have to be voted out on a certain date in the future by law. And that's democracy and democracy is good. But somehow, there is a major disconnect between the people who are guaranteed monthly cheques for a number of years to come and those who have lost their jobs and others who fear every moment of every day if they are going to lose their jobs tomorrow or the next day. Somehow, Congress seems to be missing the day to day reality of the rest of the population they serve who do not have job security, and are becoming paralyzed with fear of the unknown. Every day that the Congress does not act, they are making the situation worse.

Congress needs to find something that it can live with and do it quickly. Bad law is worse than no law. But no law is worse than inaction. As long as you are not behaving in an unconstitutional manner and affecting the rights of your citizens, you can find middle ground. Law is never perfect, but it can be sufficiently effective. If you don't ever get pass round 1, how will you get to round 2? When will anything else get done if the economy becomes frozen?

Here's a video of President Obama explaining what is in the stimulus and what it is intended to achieve.

You have to be independent to have a Congress. Perhaps Congress should give some thought to whether its own job security is on the line.