As if we’re allowed to believe otherwise, Wall Street’s continued surge is all but sure to continue to rise toward a closing bell figure of 10,000. And there are plenty of examples of news to keep those faint of pocketbook from being fearful of losing their skivvies after their pre-recession wealth has already been stripped of their greenbacks.
The second quarter 1% decline in the Gross Domestic Profit was better than expected by one-half a percent point, a vast improvement over data released by the Commerce Department for the previous two quarters that showed declines of 6.4% January-March and 5.4% October-December 2008.
Looking ahead, an anticipated 2% increase in GDP for the period July-September is based on the assumed affects from the $787B stimulus plan and the Cash for Clunkers program. If this fails to materialize, expect to hear the words “market correction” as financial news commentators continue to grin in front of the camera to no one’s joy but for their own paychecks.
A hopeful sign for economic recovery was the announcement that only 247,000 jobs were lost in July, the smallest figure in nearly a year. It could have been worse and may still spike higher on the chart of the unemployed, but the outlook on the Street is a view of a clear road ahead to a higher Dow Jones Industrial Average. Consumer spending declined a mere 1.2% during the same period. Not too dismal, huh?
A positive light in employment figures show that state and local governments have added 110,000 jobs since the recession began, along with their above free market salaries and overly generous benefits. But Jon Shure, deputy director of states’ fiscal policies of the Center on Budget and Policy Priorities, is realistic in saying, “Crunch time is still to come for the states.” What a killjoy!
In May, the savings rate among Americans reached the highest level since 1993 at 6.9%, keeping nearly $770B from circulating through the economy, the highest rate since 1959 when statistics were first gathered. Not only that, in April borrowers slowed down their buying power with a 16.5% decline in credit card purchases, or 16.5B on $1 trillion of total debt. This is no way to spur an economy that thrives on ever-increasing consumer debt.
According to international lender ING Direct, European Union members have cut back on using plastic money by 10-20% while 46% Americans say they have refrained from adding to credit card debt. Meanwhile, with high unemployment, foreclosure figures, tight credit and reduced consumer spending….
The Conference Board, an independent research group, released information last week that the Consumer Confidence Index (CCI) rose from 47.4 in July to 54.1 in August, quite a bit better than the expected 47.9 that had been forecast. Still, the index is well below 90, the minimum level indicative of a healthy economy. There’s a lot of boom to go before the economy is deemed revived.
As a reference, the significance of historical data of the CCI, it stood at 109.4 (August 1996); 82.2 (October 2001, after 9-11); 110.3 (January 2007).
The Expectations Index, taken from the same sampling of 5,000 households and measures a 6-month view on economic conditions, rose from 63.4 in July to 73.5 in August.
On the flipside of consumer view of economic recovery, the Reuters/University of Michigan Consumer Sentiment Survey, also taken of 5,000 participants, decreased from 66.00 to 63.2 from July to August although economists surveyed had expected an increase to 69 so, although the news isn’t good, it’s not as bad as feared, so it’s actually good news. Right?
The benchmark for the Confidence Survey is 1985; the Reuters/UM Sentiment Survey is referenced to 1966 with both having a base figure of 100.
As if to confuse matters, a third sampling of 1,000 participants conducted by telephone, the ABC News Consumer Comfort Survey reflected a rating of –45 (yes, that’s a negative sign on a scale of –100 to +100). Putting this in perspective, the 23-year average is –12. Only 8% rated the economy in a positive light, maintaining a single-digit trend for 43 of the past 46 weeks. By all measures, not very comforting.
And let’s not ignore the 77% decline of funds held by the FDIC from $45.2B a year ago. The current $10.4B balance would be considerably, and alarmingly, less but for the $9.1B in higher deposit fees garnered from banks in the first quarter. Not to worry, your banking account balances are still covered up to $250,000. The FDIC can draw on its no-limit credit line with the Treasury Department as it did in 1993.
Sales of new one-family homes increased 9.6% in July (plus or minus 13.4%) over June figures but 13.4% below July 2008 figures (plus or 12.9%). The plus or minus figures leave a don’t add up to anything but confusion and doubtful significance.
On a truly positive note, August figures show an increase of 4.9% for durable goods over July, and upward swing for three out of the past four months.
Who’s to say our economic future is anything other than what is portrayed by the wooly bullies on Wall Street? Anybody?
Sunday, August 30, 2009
UBS, IRS and Swiss Cheese
Goody! Goody! Relishing in other peoples’ misfortune might seem a little devilish but with the unfolding battle between the U.S. Justice Department and Swiss bank UBS there’s a childish delight in me that wants the wealthy Americans who have gotten away with fraud and tax evasion for decades may get their just deserves.
The chapters that have taken place to identify those sly dogs of greed began in earnest in February when UBS agreed to pay the IRS $780M to avoid criminal charges for making it possible for a select class of Americans to avoid paying taxes on nearly $20B they have tucked away in offshore accounts. The initial 285 names provided by UBS were just the tip of the fraud claims as the U.S. sought to have nearly 52,000 Americans names divulged.
While negotiations were being held between UBS and the Justice Department, the Swiss government had been steadfast in swearing allegiance to hidden account holders, stating they wouldn’t allow the bank to hand over the names because Swiss secrecy laws specifically prohibits client disclosure. Since then, talks have been held to avoid the U.S. from filing suit against the Swiss government and taking the matter to court.
Earlier this year Jeffrey P. Chernick, owner of a New York-based company that represents toy manufacturers in China and Hong Kong, pleaded guilty to a charge of filing a fraudulent tax return in 2007 by concealing more than $8M in reportable income.
John McCarthy, who set up a manufacturing business in Hong Kong in 2003, funneled $1M in Swiss accounts. Both men face up to five years in prison, a $250,000 fine, back taxes, interest and penalties.
The Justice Dept. is clients the opportunity to “turn themselves in” by a Sept. 23 deadline to lessen the criminal charges against them. Penalties will be reduced to a maximum of 20% of their value while those who don’t disclose their assets by the deadline could face penalties of up to 50% of their average account balances held over the past three years. Fines are expected to be in the range of $4B.
The drama that befell Mr. Chernick unfolded when transactions were traced to a former UBS manager who had set up accounts with NZB, a smaller private bank in Zurich, with the belief that by doing so would subject clients to less scrutiny by the IRS. There was a tinge of espionage going on with many of the transactions done with bank officials traveling to the U.S. as tourists rather than consultants.
A Swiss lawyer and a director at NZB, who had worked as a private banker for UBS until 2002, have been indicted for conspiring to defraud the IRS. This will prove to be just the beginning of a long process to prosecute participants of the financial institutions that have taken part in tax evasion not only in the U.S. but many of the 27-country European Union. Italy and Germany have also initiated an amnesty program while the EU has negotiated a 35% tax rate to bank accounts in Swiss Banks.
In an agreement announced this past week, UBS will turn over to the Swiss Federal Tax Administration the names of 4,450 U.S. major accounts suspected of holding undeclared assets, giving the clients an opportunity to appeal to the Swiss courts before their names are released to the IRS, a process that may take years before full disclosure is realized.
The Organization for Economic Co-operation and Development website lists 38 ‘Jurisdictions Committed to Improving Transparency and Establishing Effective Exchange of Information in Tax Matters’. As of August 14 there are no longer any countries on the ‘Uncooperative List” although Costa Rica, Malaysia, the Philippines and Uruguay were recently removed from the list but have yet to pass legislation to achieve that status.
So, according to the OECD, there are longer any tax havens but the International Monetary Fund, Tax Research Org and the U.S. Stop Tax Havens Abuse Act have their own lists as does the Tax Justice Network and taxresearch.org, all of which are in dispute with the OECD claim. In 2005, estimates of offshore tax havens held $11.5 trillion in funds globally. Hit by the worldwide recession, the figure is now approximately $7 trillion socked away.
Still, smaller Swiss banks have been brash in an attempt to assure foreign clients that new strategies are being developed to keep their accounts hidden from future scrutiny. As thousands of account holders are moving huge amounts of funds out of Swiss banks and seeking legal representation from tax consultants.
As the IRS focuses on identifying tax evaders through a program called the Offshore Identification Unit, the names may not be well known but my spiteful joys will nonetheless be forthcoming.
The chapters that have taken place to identify those sly dogs of greed began in earnest in February when UBS agreed to pay the IRS $780M to avoid criminal charges for making it possible for a select class of Americans to avoid paying taxes on nearly $20B they have tucked away in offshore accounts. The initial 285 names provided by UBS were just the tip of the fraud claims as the U.S. sought to have nearly 52,000 Americans names divulged.
While negotiations were being held between UBS and the Justice Department, the Swiss government had been steadfast in swearing allegiance to hidden account holders, stating they wouldn’t allow the bank to hand over the names because Swiss secrecy laws specifically prohibits client disclosure. Since then, talks have been held to avoid the U.S. from filing suit against the Swiss government and taking the matter to court.
Earlier this year Jeffrey P. Chernick, owner of a New York-based company that represents toy manufacturers in China and Hong Kong, pleaded guilty to a charge of filing a fraudulent tax return in 2007 by concealing more than $8M in reportable income.
John McCarthy, who set up a manufacturing business in Hong Kong in 2003, funneled $1M in Swiss accounts. Both men face up to five years in prison, a $250,000 fine, back taxes, interest and penalties.
The Justice Dept. is clients the opportunity to “turn themselves in” by a Sept. 23 deadline to lessen the criminal charges against them. Penalties will be reduced to a maximum of 20% of their value while those who don’t disclose their assets by the deadline could face penalties of up to 50% of their average account balances held over the past three years. Fines are expected to be in the range of $4B.
The drama that befell Mr. Chernick unfolded when transactions were traced to a former UBS manager who had set up accounts with NZB, a smaller private bank in Zurich, with the belief that by doing so would subject clients to less scrutiny by the IRS. There was a tinge of espionage going on with many of the transactions done with bank officials traveling to the U.S. as tourists rather than consultants.
A Swiss lawyer and a director at NZB, who had worked as a private banker for UBS until 2002, have been indicted for conspiring to defraud the IRS. This will prove to be just the beginning of a long process to prosecute participants of the financial institutions that have taken part in tax evasion not only in the U.S. but many of the 27-country European Union. Italy and Germany have also initiated an amnesty program while the EU has negotiated a 35% tax rate to bank accounts in Swiss Banks.
In an agreement announced this past week, UBS will turn over to the Swiss Federal Tax Administration the names of 4,450 U.S. major accounts suspected of holding undeclared assets, giving the clients an opportunity to appeal to the Swiss courts before their names are released to the IRS, a process that may take years before full disclosure is realized.
The Organization for Economic Co-operation and Development website lists 38 ‘Jurisdictions Committed to Improving Transparency and Establishing Effective Exchange of Information in Tax Matters’. As of August 14 there are no longer any countries on the ‘Uncooperative List” although Costa Rica, Malaysia, the Philippines and Uruguay were recently removed from the list but have yet to pass legislation to achieve that status.
So, according to the OECD, there are longer any tax havens but the International Monetary Fund, Tax Research Org and the U.S. Stop Tax Havens Abuse Act have their own lists as does the Tax Justice Network and taxresearch.org, all of which are in dispute with the OECD claim. In 2005, estimates of offshore tax havens held $11.5 trillion in funds globally. Hit by the worldwide recession, the figure is now approximately $7 trillion socked away.
Still, smaller Swiss banks have been brash in an attempt to assure foreign clients that new strategies are being developed to keep their accounts hidden from future scrutiny. As thousands of account holders are moving huge amounts of funds out of Swiss banks and seeking legal representation from tax consultants.
As the IRS focuses on identifying tax evaders through a program called the Offshore Identification Unit, the names may not be well known but my spiteful joys will nonetheless be forthcoming.
A Quote on Health Care Please
The mean and vicious dialogue from those with insurance coverage is so intense that you have to question the compassion of their religious convictions, if there is any. Their perceived selfishness in promoting health care benefits for the uninsured lead me to also question if those with defined benefits have a concern even for friends and relatives without coverage.
What of a parent not yet eligible for Medicare or a grandchild, an adult son or daughter faced with insurmountable expenses? Do those with coverage have the disposition, “Good luck, but you’re on your own.”? Seeking ER care as a last resort may be a final, fatal course of action. Seeking medical attention from a general practitioner requires ‘Full Payment Due At Time of Service”.
Not everyone is fortunate to work for, or retire from, a large corporation that provides company-subsidized health benefits. Unions have successfully fought long and hard for such coverage but people working for small businesses don’t qualify for group rate ‘discounts’.
Although having taken early retirement from the Bell System with a pension that puts me near poverty level, the most important benefit is medical coverage. With modest deductibles and payment of 90% toward doctor and hospital visits, there are still recommended treatments that are ignored because of unknown expenses. I feel fine. Still, I see a family physician occasionally to keep cholesterol and blood pressure levels in check. (When medications brought the levels within normal range, I suggested the medications might not be needed any longer. My ignorance was kindly acknowledged.)
Before a mechanic performs work on a car, the customer is given an estimate and any additional expenses must be authorized by the owner. When dental work needs to be done the costs are reviewed with the patient and provided with a printed predetermination of patient responsibility. A consultation may result in alternative options such as having a tooth removed because the root canal is cost prohibitive.
Generally, quotes on medical procedures aren’t provided unless requested, especially in an emergency room.
A friend was recently involved in an automobile accident. Although not seriously hurt, after four days when neck and back pains developed the family physician sent him to the Brooksville Regional Hospital ER. The charges incurred were in excess of $15K. The automobile medical coverage was $10K. The Coordination of Benefits form submitted to Medicare may pick up the remainder.
It would have been unwise to ignore symptoms that could have proven to be a lifetime problem, but all of the x-rays and scans proved negative. Had the full charges been disclosed he may have opted out of scans of the pelvis and abdomen or declined the Comprehensive Metabolic Panel because he experienced no discomfort whatsoever in these areas.
Those tests alone accounted for over $5,000 in charges. Two x-ray views of the hip came at an additional cost of over $500. The $353.87 fee for the cervical collar is questionable – it was only used momentarily because it caused extreme pain. Perhaps another patient will be charged the same fee for the use of the very same device? I stayed with my friend through the whole ordeal and listened to vague explanations of what tests were being administered but no mention of the whys. It cost $862 just to enter the ER Department.
You have to question if having insurance determines the extent and number of tests that are performed, not for the benefit of the patient but for the monetary gains of the facility.
Of course, the patient is supposed to have faith that a healthcare facility and its doctors and technicians will perform the tests necessary to treat the indicated ailments. In this case, some of the tests were definitely frivolous.
My friend’s experience has greatly affected my view toward seeking emergency room services. Unless totally incapacitated, they won’t like me very much with my mindful concern of both body and pocketbook. The medical profession has the responsibility to promote procedures for the betterment of the patient’s health but it’s also the patient’s right of self-determination to weigh the benefits of any treatment. Without symptoms, what’s the point?
I seldom question the capabilities of doctors and other trained professionals in the medical field, but in the future they may have a hard sell to peddle procedural wherewithal. I doubt a Tony Robbins motivational seminar will help their cause.
Cost containment for the patient’s pocketbook is another important consideration in the healthcare debate. Or is this something else to get nasty about? Oh, yeah, it’s the sharing of healthcare benefits with the uninsured that makes the headlines. That attitude is enough to make some people angry.
What of a parent not yet eligible for Medicare or a grandchild, an adult son or daughter faced with insurmountable expenses? Do those with coverage have the disposition, “Good luck, but you’re on your own.”? Seeking ER care as a last resort may be a final, fatal course of action. Seeking medical attention from a general practitioner requires ‘Full Payment Due At Time of Service”.
Not everyone is fortunate to work for, or retire from, a large corporation that provides company-subsidized health benefits. Unions have successfully fought long and hard for such coverage but people working for small businesses don’t qualify for group rate ‘discounts’.
Although having taken early retirement from the Bell System with a pension that puts me near poverty level, the most important benefit is medical coverage. With modest deductibles and payment of 90% toward doctor and hospital visits, there are still recommended treatments that are ignored because of unknown expenses. I feel fine. Still, I see a family physician occasionally to keep cholesterol and blood pressure levels in check. (When medications brought the levels within normal range, I suggested the medications might not be needed any longer. My ignorance was kindly acknowledged.)
Before a mechanic performs work on a car, the customer is given an estimate and any additional expenses must be authorized by the owner. When dental work needs to be done the costs are reviewed with the patient and provided with a printed predetermination of patient responsibility. A consultation may result in alternative options such as having a tooth removed because the root canal is cost prohibitive.
Generally, quotes on medical procedures aren’t provided unless requested, especially in an emergency room.
A friend was recently involved in an automobile accident. Although not seriously hurt, after four days when neck and back pains developed the family physician sent him to the Brooksville Regional Hospital ER. The charges incurred were in excess of $15K. The automobile medical coverage was $10K. The Coordination of Benefits form submitted to Medicare may pick up the remainder.
It would have been unwise to ignore symptoms that could have proven to be a lifetime problem, but all of the x-rays and scans proved negative. Had the full charges been disclosed he may have opted out of scans of the pelvis and abdomen or declined the Comprehensive Metabolic Panel because he experienced no discomfort whatsoever in these areas.
Those tests alone accounted for over $5,000 in charges. Two x-ray views of the hip came at an additional cost of over $500. The $353.87 fee for the cervical collar is questionable – it was only used momentarily because it caused extreme pain. Perhaps another patient will be charged the same fee for the use of the very same device? I stayed with my friend through the whole ordeal and listened to vague explanations of what tests were being administered but no mention of the whys. It cost $862 just to enter the ER Department.
You have to question if having insurance determines the extent and number of tests that are performed, not for the benefit of the patient but for the monetary gains of the facility.
Of course, the patient is supposed to have faith that a healthcare facility and its doctors and technicians will perform the tests necessary to treat the indicated ailments. In this case, some of the tests were definitely frivolous.
My friend’s experience has greatly affected my view toward seeking emergency room services. Unless totally incapacitated, they won’t like me very much with my mindful concern of both body and pocketbook. The medical profession has the responsibility to promote procedures for the betterment of the patient’s health but it’s also the patient’s right of self-determination to weigh the benefits of any treatment. Without symptoms, what’s the point?
I seldom question the capabilities of doctors and other trained professionals in the medical field, but in the future they may have a hard sell to peddle procedural wherewithal. I doubt a Tony Robbins motivational seminar will help their cause.
Cost containment for the patient’s pocketbook is another important consideration in the healthcare debate. Or is this something else to get nasty about? Oh, yeah, it’s the sharing of healthcare benefits with the uninsured that makes the headlines. That attitude is enough to make some people angry.
Health Care Deformity
Back off, you bugaboos! Take a break. Take in a great big breath. Not only is this a proven method of relaxation but it also provides a good dose of oxygen for a healthier brain, thus a positive prognosis for the all too contentious debate on healthcare reform.
All of the knee-jerk reactions on the debate of providing medical coverage to the uninsured have gotten everybody’s panties in a bunch. The hate factor among all the interested groups won’t resolve the issue to anyone’s satisfaction, except possibly President Obama and a number of die-hard Democrats. Currently, there is no dialogue that will provide a cure-all for what ails uninsured Americans.
For years, the high cost of providing health insurance through employer-based coverage has made American business at a frightful disadvantage for competitive product pricing in the broadening realm of globalization.
Corporate medical contributions to employee benefits come to an annual expense of about $15,000 – for government employees the un-taxed benefits are even more obtuse at $19,000. These costs continue to be a prominent reason for the outsourcing of jobs to foreign lands. We’ve painted the survival of American enterprise into a corner, but there are steps that can be taken to correct this poor state of affairs.
Before providing “universal” coverage, the cost factors of health care must be addressed.
Three years ago Massachusetts enacted the most comprehensive subsidized insurance fee-for-service public offering and cut the rate of uninsured residents from 8% to 2.6%, the lowest in the country. Although an addition 428,000 people were given affordable coverage, it has resulted in an insurmountable budget crisis. The state is on the hook for an additional $595,000 than it was in 2006, a 42% increase.
Enacting universal coverage in Maine in 2005 resulted in a 74% increase in premiums, pricing many of the uninsured out of the market and dropping coverage. The uninsured rate is 10%, the same level as before legislation was passed.
Neither Maine nor Massachusetts bothered to address a means to implement cost-cutting measures of medical pricing. For decades, private insurance companies have maintained what could easily be considered price fixing since in-state health options are generally restricted to two or three major providers.
This lack of competition defies the intent of the free market system. The self-interest of insurance companies, service providers and drug companies is too impressionable on elected officials. The inherent power of lobbyist groups set up by former legislators are too influential on the course of action of Congress. They know the ropes. They have the contacts. The have access to funds for campaign contributions. And they have too tight a grip on the health of Americans.
Rather than accuse Obama of promoting a death forum for the elderly, the feeble and the less-than-productive members of society, put the blame on insurance companies for limiting and denying medical procedures that would otherwise enhance the lives of the unfortunate.
Pharmaceutical companies are major culprits in themselves. When the Medicare Drug Plan was enacted in January 2006, they raked in an additional $8B in profits in the first six months alone. The industry has promised an $80B sacrifice over a ten-year period as a buy-in to healthcare reform, a minor contribution toward the health of the country considering their huge profit margins.
The U.S. has the most profitable pharmaceutical business in the world with revenues of $315B in 2007. As a comparison, the illegal drug industry has profits of approximately $300B in revenue per year, globally speaking.
What could be considered an unethical tactic of pharmaceutical companies is the “pay-for-delay” scheme that keeps generic drugs off the market by providing attractive monetary incentives to maintain an extended monopoly over less expensive drug manufacturers. The FTC estimates Americans are cheated out of about $3.5B per year. Then there’s the practice of putting “name brand” generic versions on the market for drugs whose patents have expired, affectively making it unprofitable for true generic companies to offer competitive pricing for an additional six months
Pharmaceutical companies and insurance companies are keeping Red Bull Republicans and Blue Dog Democrats at bay, caged in dollar signs of influence.
It’s understandable that Americans are leery of healthcare reform. Obama claims his efforts will be deficit neutral. Even if an attainable goal, through higher premiums, increased deductibles and restricted coverage, a redistribution of health wealth will help some but will come at a great cost to the currently insured. Town Hall Brawls are not the answer.
Containing costs in all aspects of providing ‘universal medical coverage’ must be addressed before continued debate gets out of hand and people’s health conditions deteriorate. Is this an orchestrated script by insurers and providers to further increase profits? Depending on whether or not you have health insurance, you can bet your life or death on it.
All of the knee-jerk reactions on the debate of providing medical coverage to the uninsured have gotten everybody’s panties in a bunch. The hate factor among all the interested groups won’t resolve the issue to anyone’s satisfaction, except possibly President Obama and a number of die-hard Democrats. Currently, there is no dialogue that will provide a cure-all for what ails uninsured Americans.
For years, the high cost of providing health insurance through employer-based coverage has made American business at a frightful disadvantage for competitive product pricing in the broadening realm of globalization.
Corporate medical contributions to employee benefits come to an annual expense of about $15,000 – for government employees the un-taxed benefits are even more obtuse at $19,000. These costs continue to be a prominent reason for the outsourcing of jobs to foreign lands. We’ve painted the survival of American enterprise into a corner, but there are steps that can be taken to correct this poor state of affairs.
Before providing “universal” coverage, the cost factors of health care must be addressed.
Three years ago Massachusetts enacted the most comprehensive subsidized insurance fee-for-service public offering and cut the rate of uninsured residents from 8% to 2.6%, the lowest in the country. Although an addition 428,000 people were given affordable coverage, it has resulted in an insurmountable budget crisis. The state is on the hook for an additional $595,000 than it was in 2006, a 42% increase.
Enacting universal coverage in Maine in 2005 resulted in a 74% increase in premiums, pricing many of the uninsured out of the market and dropping coverage. The uninsured rate is 10%, the same level as before legislation was passed.
Neither Maine nor Massachusetts bothered to address a means to implement cost-cutting measures of medical pricing. For decades, private insurance companies have maintained what could easily be considered price fixing since in-state health options are generally restricted to two or three major providers.
This lack of competition defies the intent of the free market system. The self-interest of insurance companies, service providers and drug companies is too impressionable on elected officials. The inherent power of lobbyist groups set up by former legislators are too influential on the course of action of Congress. They know the ropes. They have the contacts. The have access to funds for campaign contributions. And they have too tight a grip on the health of Americans.
Rather than accuse Obama of promoting a death forum for the elderly, the feeble and the less-than-productive members of society, put the blame on insurance companies for limiting and denying medical procedures that would otherwise enhance the lives of the unfortunate.
Pharmaceutical companies are major culprits in themselves. When the Medicare Drug Plan was enacted in January 2006, they raked in an additional $8B in profits in the first six months alone. The industry has promised an $80B sacrifice over a ten-year period as a buy-in to healthcare reform, a minor contribution toward the health of the country considering their huge profit margins.
The U.S. has the most profitable pharmaceutical business in the world with revenues of $315B in 2007. As a comparison, the illegal drug industry has profits of approximately $300B in revenue per year, globally speaking.
What could be considered an unethical tactic of pharmaceutical companies is the “pay-for-delay” scheme that keeps generic drugs off the market by providing attractive monetary incentives to maintain an extended monopoly over less expensive drug manufacturers. The FTC estimates Americans are cheated out of about $3.5B per year. Then there’s the practice of putting “name brand” generic versions on the market for drugs whose patents have expired, affectively making it unprofitable for true generic companies to offer competitive pricing for an additional six months
Pharmaceutical companies and insurance companies are keeping Red Bull Republicans and Blue Dog Democrats at bay, caged in dollar signs of influence.
It’s understandable that Americans are leery of healthcare reform. Obama claims his efforts will be deficit neutral. Even if an attainable goal, through higher premiums, increased deductibles and restricted coverage, a redistribution of health wealth will help some but will come at a great cost to the currently insured. Town Hall Brawls are not the answer.
Containing costs in all aspects of providing ‘universal medical coverage’ must be addressed before continued debate gets out of hand and people’s health conditions deteriorate. Is this an orchestrated script by insurers and providers to further increase profits? Depending on whether or not you have health insurance, you can bet your life or death on it.
Ben Barnanke, A Has Been?
Politics aside, or not, Ben Barnanke, Chairman of the Federal Reserve, is on a campaign trail to reassure investors that his monetary policies of the past, present and future have and will continue to guide us out of the recession. His messages aren’t meant to save the economy, but to save his job when his four-year term comes up for re-selection in January.
He’s faced Congress to substantiate, or defend, his worthiness. His words have appeared on editorial pages in newspapers across the nation. He’s done TV interviews on ‘60 Minutes’ and ‘The News Hour with Jim Lehrer’.
During his confirmation hearings in 2006, Bernanke espoused his views on economic theory and policy, stressing the importance of communication and transparency. But he also said the final say on government debt and deficits lie with the President and Congress.
Having written numerous books and articles, he frequently focused on limiting inflation to no more than 2% over any given two-year period. For now, there appears little concern. As a matter of fact, many economists feel the risk of deflation is more worrisome. Deflation occurs when consumers hold off buying big-ticket items with the belief that during an economic downturn prices will continue to fall. The result is lower demand so job losses increase, employers then curtail investments because demand is low resulting in higher unemployment, foreclosures and bankruptcies.
Synopsis: no spending = no demand = no need to increase supply = fewer jobs, and so forth. The spiral ends when inflation appears.
Other economists are fearful that actions taken to fight deflation in the long term will result in runaway inflation. This would be the beast that puts the economy at risk for many years to come. A couple of indicators suggest we’re on our way. In January the 30-year fixed mortgage rate climbed from 4.96% to 5.12% within a week’s time. It stabilized in May just below 5.0% but it as of July 29 it stood at 5.56% per Bankrate’s weekly survey. This is a vast improvement from 6.77% a year ago, bringing down monthly payments by $158 on a $200,000 mortgage, but it may turn out to be short-term relief.
The Fed is printing more and more stimulus money, which means increased government borrowing, resulting in an ever-growing portion of tax dollars being paid toward interest. This could mean more printing of money and an increase in debt. Another stimulus package would exacerbate the situation.
Since Sept. 2007 the Fed interest rate has been cut nine times from 5.25% to near zero in Dec 2008, significantly adding to the prospects of deflation. There’s nowhere to go but up, which will certainly bring down the stock market.
To worsen matters, this past week China, which holds an estimated $1.5 trillion in Treasury securities, sought a guarantee that the U.S. will cut its debt. Timothy Geithner gave his assurance that, as economic recovery strengthens, debt reduction will follow. As consumer confidence continues to wane, the prospects are anything but positive.
Alan Greenspan, whose actions are said to have been a large contributor to the current recession, admitted he “made a mistake” in opposing regulation of derivatives and acknowledged that financial institutions didn't protect shareholder investments as had been expected. He said that he and other economists are in “a state of shocked disbelief”… “that regulation in the banking industry led to meltdown of U.S. credit markets”.
Greenspan was supportive of sub-prime lending practices that led to the housing bubble. He was also at the helm of the Fed when the dot-com bubble burst.
And yet he says the Fed was blameless for the housing bubble that began in 2006. It’s a little hard to accept since he was Chairman for 18 years, going back to his appointment in 1988 by President Reagan up until the appointment of Bernanke in 2006, at which time the President Bush said, “Ben Bernanke is the right man to build on the record Alan Greenspan has established." This should have rung a few bells that the economy would continue to sputter, falter and come to a near standstill.
Where does that leave Bernanke? With President Obama’s tendency to recycle past Democrat influences, odds are that he’ll appoint Director of the National Economic Council Larry Summers. This is the same guy that, as Treasury Secretary during the Clinton administration, had supported the 1999 Gramm-Leach-Bliley Act. This bill repealed the 1933 Glass-Steagal Act, which had taken actions to correct the conflicts of interest and fraud in banking institutions that had allowed them to own other financial companies. See where we are now? There’s plenty of blame from every which way you choose.
There’s an excellent possibility that Barnanke’s campaign scheme to keep his job as Fed Chairman will be for naught. Ben may become a has-been.
He’s faced Congress to substantiate, or defend, his worthiness. His words have appeared on editorial pages in newspapers across the nation. He’s done TV interviews on ‘60 Minutes’ and ‘The News Hour with Jim Lehrer’.
During his confirmation hearings in 2006, Bernanke espoused his views on economic theory and policy, stressing the importance of communication and transparency. But he also said the final say on government debt and deficits lie with the President and Congress.
Having written numerous books and articles, he frequently focused on limiting inflation to no more than 2% over any given two-year period. For now, there appears little concern. As a matter of fact, many economists feel the risk of deflation is more worrisome. Deflation occurs when consumers hold off buying big-ticket items with the belief that during an economic downturn prices will continue to fall. The result is lower demand so job losses increase, employers then curtail investments because demand is low resulting in higher unemployment, foreclosures and bankruptcies.
Synopsis: no spending = no demand = no need to increase supply = fewer jobs, and so forth. The spiral ends when inflation appears.
Other economists are fearful that actions taken to fight deflation in the long term will result in runaway inflation. This would be the beast that puts the economy at risk for many years to come. A couple of indicators suggest we’re on our way. In January the 30-year fixed mortgage rate climbed from 4.96% to 5.12% within a week’s time. It stabilized in May just below 5.0% but it as of July 29 it stood at 5.56% per Bankrate’s weekly survey. This is a vast improvement from 6.77% a year ago, bringing down monthly payments by $158 on a $200,000 mortgage, but it may turn out to be short-term relief.
The Fed is printing more and more stimulus money, which means increased government borrowing, resulting in an ever-growing portion of tax dollars being paid toward interest. This could mean more printing of money and an increase in debt. Another stimulus package would exacerbate the situation.
Since Sept. 2007 the Fed interest rate has been cut nine times from 5.25% to near zero in Dec 2008, significantly adding to the prospects of deflation. There’s nowhere to go but up, which will certainly bring down the stock market.
To worsen matters, this past week China, which holds an estimated $1.5 trillion in Treasury securities, sought a guarantee that the U.S. will cut its debt. Timothy Geithner gave his assurance that, as economic recovery strengthens, debt reduction will follow. As consumer confidence continues to wane, the prospects are anything but positive.
Alan Greenspan, whose actions are said to have been a large contributor to the current recession, admitted he “made a mistake” in opposing regulation of derivatives and acknowledged that financial institutions didn't protect shareholder investments as had been expected. He said that he and other economists are in “a state of shocked disbelief”… “that regulation in the banking industry led to meltdown of U.S. credit markets”.
Greenspan was supportive of sub-prime lending practices that led to the housing bubble. He was also at the helm of the Fed when the dot-com bubble burst.
And yet he says the Fed was blameless for the housing bubble that began in 2006. It’s a little hard to accept since he was Chairman for 18 years, going back to his appointment in 1988 by President Reagan up until the appointment of Bernanke in 2006, at which time the President Bush said, “Ben Bernanke is the right man to build on the record Alan Greenspan has established." This should have rung a few bells that the economy would continue to sputter, falter and come to a near standstill.
Where does that leave Bernanke? With President Obama’s tendency to recycle past Democrat influences, odds are that he’ll appoint Director of the National Economic Council Larry Summers. This is the same guy that, as Treasury Secretary during the Clinton administration, had supported the 1999 Gramm-Leach-Bliley Act. This bill repealed the 1933 Glass-Steagal Act, which had taken actions to correct the conflicts of interest and fraud in banking institutions that had allowed them to own other financial companies. See where we are now? There’s plenty of blame from every which way you choose.
There’s an excellent possibility that Barnanke’s campaign scheme to keep his job as Fed Chairman will be for naught. Ben may become a has-been.
Making A Heroic Correction
In response to last Sunday’s ‘Where have all the heroes gone?’ there were a fair number of email and on-line reader comments that were as valid as the stamp of a Notary Public. I gladly accept criticism for not everyone has the same views as myself. In this instance, my errors warrant a recant as others deserve recognition for their exceptional critiques.
As delivered by email from Mr. Vlasto, a point of inaccuracy in the ‘heroes’ column claimed President Dwight Eisenhower had received the Congressional Medal of Honor. In actuality General Eisenhower had refused the Medal as he felt it should be reserved for servicemen and women for bravery and valor. As if his wartime contributions were anything but!
Of the other comments, a most deserving on-line remark from ‘stopthespending’ put into question my reference to the ineffectiveness of the troop surge under the command of General David Patraeus. The writer emphasized the General’s worthy attributes that make him “a hero and deserves a Medal of Honor he secured Iraq and is a great man”. The writer made me pause again with a final statement, “I could name many more but why should I you only disagree.” I bow my head, partly in shame but also in respectful appreciation for the sacrifices and loss of lives of so many soldiers who have been steadfast in honoring the American Flag so that we may all live safe and free from harm in a world too dangerous for us soft-shoed citizens to truly comprehend.
Two other emails were unexpected with each providing a phone number as an offering for a moment of discussion.
The first was in agreement America’s working men and women are, or should be recognized as, the real heroes who can bring America around from these days of near economic ruin. The gentleman posed the question, “I wonder what the government is doing to set them up for success?” He answered, “Not much.”
He also made a correction that he “did not take on Dave Patraeus.” I immediately checked it out through my fairly trusted search mechanism, Google, and realized I had indeed made a grievous error that made me the goof. He, and the other 20 Generals I identified in the column, had actually chastised then-Secretary of Defense Donald Rumsfeld and the failed strategy of the Bush Administration in Iraq.
When I called the gentleman I was taken aback that he answered simply, “John Batiste.” I couldn’t possibly address him but with the respectful title of “General Batiste, this is Ron Rae…” with a reference to the column on heroes. When I expressed regret on my reference to General Patraeus, he kindly brushed it off.
From there the exchange of words were conversational. As a civilian and President of Klein Steel, Inc., he has seen a major turnaround in business since the first of the year. I made mention of a 30 second spot he had made on behalf of VoteVets with the theme that “Mr. President, you did not listen”. It was because of the Commander-in-Chief’s policies that led General Batiste, and others, to protest with early retirement.
The General no longer associates himself with VoteVets, which ‘Aims to put Iraq and Afghanistan veterans in Congress who are critical of the execution of the war in Iraq’, because it has become too centered on politics. Mr. Batiste, I mean General Batiste, is not a political pundit in the slightest.
The other email was from Retired Major General Paul D. Eaton who was justifiably critical of my “misrepresenting” his views and strongly suggested that “not critiquing” him further should be my only action. Not only was there a reference to the aforementioned error in regards to comments about General Patraeus, but General Eaton also informed me that he has been objectionable of Chairman of the Joint Chiefs of Staff General Peter Pace for having said that “this country is exceptionally well served “ by Donald Rumsfeld. Vice Chairman General Richard B. Meyers was also criticized for what I might say has been a misbegotten game of ‘follow the leader’. I needn’t say more out of respect for what was truly an unforgivable misrepresentation of General Eaton.
I stand corrected as I stand in salute for the sacrifices of each and every American hero who has defended these great United States of America from not only branded enemies of the past but also today’s enemies wear no uniform but have a uniform goal of terrorizing those with opposing ideologies, including innocent civilian bystanders.
As delivered by email from Mr. Vlasto, a point of inaccuracy in the ‘heroes’ column claimed President Dwight Eisenhower had received the Congressional Medal of Honor. In actuality General Eisenhower had refused the Medal as he felt it should be reserved for servicemen and women for bravery and valor. As if his wartime contributions were anything but!
Of the other comments, a most deserving on-line remark from ‘stopthespending’ put into question my reference to the ineffectiveness of the troop surge under the command of General David Patraeus. The writer emphasized the General’s worthy attributes that make him “a hero and deserves a Medal of Honor he secured Iraq and is a great man”. The writer made me pause again with a final statement, “I could name many more but why should I you only disagree.” I bow my head, partly in shame but also in respectful appreciation for the sacrifices and loss of lives of so many soldiers who have been steadfast in honoring the American Flag so that we may all live safe and free from harm in a world too dangerous for us soft-shoed citizens to truly comprehend.
Two other emails were unexpected with each providing a phone number as an offering for a moment of discussion.
The first was in agreement America’s working men and women are, or should be recognized as, the real heroes who can bring America around from these days of near economic ruin. The gentleman posed the question, “I wonder what the government is doing to set them up for success?” He answered, “Not much.”
He also made a correction that he “did not take on Dave Patraeus.” I immediately checked it out through my fairly trusted search mechanism, Google, and realized I had indeed made a grievous error that made me the goof. He, and the other 20 Generals I identified in the column, had actually chastised then-Secretary of Defense Donald Rumsfeld and the failed strategy of the Bush Administration in Iraq.
When I called the gentleman I was taken aback that he answered simply, “John Batiste.” I couldn’t possibly address him but with the respectful title of “General Batiste, this is Ron Rae…” with a reference to the column on heroes. When I expressed regret on my reference to General Patraeus, he kindly brushed it off.
From there the exchange of words were conversational. As a civilian and President of Klein Steel, Inc., he has seen a major turnaround in business since the first of the year. I made mention of a 30 second spot he had made on behalf of VoteVets with the theme that “Mr. President, you did not listen”. It was because of the Commander-in-Chief’s policies that led General Batiste, and others, to protest with early retirement.
The General no longer associates himself with VoteVets, which ‘Aims to put Iraq and Afghanistan veterans in Congress who are critical of the execution of the war in Iraq’, because it has become too centered on politics. Mr. Batiste, I mean General Batiste, is not a political pundit in the slightest.
The other email was from Retired Major General Paul D. Eaton who was justifiably critical of my “misrepresenting” his views and strongly suggested that “not critiquing” him further should be my only action. Not only was there a reference to the aforementioned error in regards to comments about General Patraeus, but General Eaton also informed me that he has been objectionable of Chairman of the Joint Chiefs of Staff General Peter Pace for having said that “this country is exceptionally well served “ by Donald Rumsfeld. Vice Chairman General Richard B. Meyers was also criticized for what I might say has been a misbegotten game of ‘follow the leader’. I needn’t say more out of respect for what was truly an unforgivable misrepresentation of General Eaton.
I stand corrected as I stand in salute for the sacrifices of each and every American hero who has defended these great United States of America from not only branded enemies of the past but also today’s enemies wear no uniform but have a uniform goal of terrorizing those with opposing ideologies, including innocent civilian bystanders.
Where Have All The Heroes Gone?
Where are today’s heroes? Are there any? Who might they be?
In this month of July we honor the independence of our nation for the contributions of our Founding Fathers, without whom there would be no heroes of these United States of America. Let us all remember to give thanks to the vast number of heroes of the Revolutionary War for we are a free country unto ourselves that goes beyond the 4th of July.
John Hancock, president of the Continental Congress, commissioned George Washington as Commander in Chief of the United States Colonies, the only president to be voted unanimously to lead the country. A true hero by all measures in American history.
Paul Revere one April 18, 1775, accompanied by William Dawes and Dr. Samuel Prescott, who rode through the night from Boston to Lexington with a two-lantern signal advising John Hancock and Samuel Adams the approach of British soldiers and, by his own account, cried out as he entered towns along the 16-mile route, “The regulars are coming out!”
The Congressional Medal of Honor is bestowed upon military personnel who distinguish themselves for “…conspicuously by gallantry and intrepidity at the risk of his life above and beyond the call of duty while engaged in an action against an enemy…”
President Lincoln established the Navy Medal of Honor Dec 21, 1861. The Army Medal of Honor followed on July 12, 1862. The first recipient of the medal was presented to Pvt. Jacob Parrot and five other members of Andrew’s Raiders in 1863 for disrupting the advance of the Confederate Army by rail from Atlanta to Chattanooga. A total of nineteen medals were issued for this act of gallantry, although their capture resulted in the failure of the intended result.
There are three medals each for the Army, the Air Force and the Navy/Marines/Coast guard. The self-descriptive word “Valor” appears on both the medals issued by the Army and Air Force.
Per the Congressional Medal of Honor Society, there have been a total of 3447 Medal of Honor recipients. Eighty-seven were African Americans. The first and only female to be awarded for her contributions is Dr. Mary Walker for her medical services during the Civil War. Her medal was revoked in 1917 due to a revision by Congress to award those involved in “actual combat with the enemy”. Refusing to return it, she wore it until her death. President Carter reinstated the medal in 1977.
The most recent recipient is Pvt. 1st Class Ross A. McGinnis on June 5, 2008, for having sacrificed his life by throwing himself on a live grenade, thus saving the lives of at least four other soldiers in combat in Iraq.
Five-star Generals include General Douglas MacArthur and Dwight Eisenhower; four-star Generals include Ulysses S. Grant and Alexander Grift. Other Generals include James Doolittle and Theodore Roosevelt Jr.
Who are our top-ranked military heroes today? None have yet, nor may they ever, receive the Medal of Honor.
Four-star General David Patraeus was affectively criticized in the fall of 2007 when over 20 Generals, including John Batiste, Gregory Newbold, Paul D. Eaton, John Riggs, Wesley Clark and Wayne Downing, spoke out about his handling of the conflict in Iraq.
Patraeus was inappropriately likened to a traitor in 2007 for a progress report supportive of success for the troop surge in Iraq under the guidance of the Bush Administration. In October 2008, four-star General Patraeus was chosen Commander of the U.S. Central Command, overseeing military operations throughout the Middle East region, including hotspots Afghanistan, Iran and Pakistan. Patraeus’ record may become a campaign issue if rumors materialize that he will seek the Republican nomination in the 2012 presidential election. By any definition of the term, will he be remembered as a hero?
Although not of military rank, the heroic actions of the civilians on that day of infamy, September 11, 2001, deserve more recognition than an on-site memorial at Ground Zero. If nothing else, Congressional Gold Medals would be appropriate.
The Congressional Gold Medal is the highest civilian award as an appreciation for distinguished achievements of achievement to individuals, institutions or events. To date, there are 149 acknowledged contributors including George Washington, the Dalai Lama, Rosa Parks, John Wayne, Bob Hope, Irving Berlin, Robert Frost, Winston Churchill, the American Red Cross, the entire 650 U.S. 1980 Summer Olympic Teams (650), Pope John Paul II, Charles Shultz, Thomas Edison, and on and on…
I ponder again, Who are today’s heroes?
Neither President Obama or Democrats nor Republicans. Ben Barnanke, Chairman of the Federal Reserve? Treasury Secretary Timothy Geithner? Or his predecessor Henry Paulson? The defense of their actions in Congressional hearings supports the impression they are heroes unto themselves.
It appears that Goldman Sachs, with a never before seen quarterly profit of $3.4B and JP Morgan with $2.7B in earnings, may be perceived as champions of Wall Street, which is also having a heck of a lot of hay days in recent weeks. Investor profiteers and those with propped-up bonuses are the ones who are able to increase the overall savings rate among Americans. It ain’t you or me. There golden eggs are again leaving the rest of us with cracked shells and empty nest eggs.
In this month of July we honor the independence of our nation for the contributions of our Founding Fathers, without whom there would be no heroes of these United States of America. Let us all remember to give thanks to the vast number of heroes of the Revolutionary War for we are a free country unto ourselves that goes beyond the 4th of July.
John Hancock, president of the Continental Congress, commissioned George Washington as Commander in Chief of the United States Colonies, the only president to be voted unanimously to lead the country. A true hero by all measures in American history.
Paul Revere one April 18, 1775, accompanied by William Dawes and Dr. Samuel Prescott, who rode through the night from Boston to Lexington with a two-lantern signal advising John Hancock and Samuel Adams the approach of British soldiers and, by his own account, cried out as he entered towns along the 16-mile route, “The regulars are coming out!”
The Congressional Medal of Honor is bestowed upon military personnel who distinguish themselves for “…conspicuously by gallantry and intrepidity at the risk of his life above and beyond the call of duty while engaged in an action against an enemy…”
President Lincoln established the Navy Medal of Honor Dec 21, 1861. The Army Medal of Honor followed on July 12, 1862. The first recipient of the medal was presented to Pvt. Jacob Parrot and five other members of Andrew’s Raiders in 1863 for disrupting the advance of the Confederate Army by rail from Atlanta to Chattanooga. A total of nineteen medals were issued for this act of gallantry, although their capture resulted in the failure of the intended result.
There are three medals each for the Army, the Air Force and the Navy/Marines/Coast guard. The self-descriptive word “Valor” appears on both the medals issued by the Army and Air Force.
Per the Congressional Medal of Honor Society, there have been a total of 3447 Medal of Honor recipients. Eighty-seven were African Americans. The first and only female to be awarded for her contributions is Dr. Mary Walker for her medical services during the Civil War. Her medal was revoked in 1917 due to a revision by Congress to award those involved in “actual combat with the enemy”. Refusing to return it, she wore it until her death. President Carter reinstated the medal in 1977.
The most recent recipient is Pvt. 1st Class Ross A. McGinnis on June 5, 2008, for having sacrificed his life by throwing himself on a live grenade, thus saving the lives of at least four other soldiers in combat in Iraq.
Five-star Generals include General Douglas MacArthur and Dwight Eisenhower; four-star Generals include Ulysses S. Grant and Alexander Grift. Other Generals include James Doolittle and Theodore Roosevelt Jr.
Who are our top-ranked military heroes today? None have yet, nor may they ever, receive the Medal of Honor.
Four-star General David Patraeus was affectively criticized in the fall of 2007 when over 20 Generals, including John Batiste, Gregory Newbold, Paul D. Eaton, John Riggs, Wesley Clark and Wayne Downing, spoke out about his handling of the conflict in Iraq.
Patraeus was inappropriately likened to a traitor in 2007 for a progress report supportive of success for the troop surge in Iraq under the guidance of the Bush Administration. In October 2008, four-star General Patraeus was chosen Commander of the U.S. Central Command, overseeing military operations throughout the Middle East region, including hotspots Afghanistan, Iran and Pakistan. Patraeus’ record may become a campaign issue if rumors materialize that he will seek the Republican nomination in the 2012 presidential election. By any definition of the term, will he be remembered as a hero?
Although not of military rank, the heroic actions of the civilians on that day of infamy, September 11, 2001, deserve more recognition than an on-site memorial at Ground Zero. If nothing else, Congressional Gold Medals would be appropriate.
The Congressional Gold Medal is the highest civilian award as an appreciation for distinguished achievements of achievement to individuals, institutions or events. To date, there are 149 acknowledged contributors including George Washington, the Dalai Lama, Rosa Parks, John Wayne, Bob Hope, Irving Berlin, Robert Frost, Winston Churchill, the American Red Cross, the entire 650 U.S. 1980 Summer Olympic Teams (650), Pope John Paul II, Charles Shultz, Thomas Edison, and on and on…
I ponder again, Who are today’s heroes?
Neither President Obama or Democrats nor Republicans. Ben Barnanke, Chairman of the Federal Reserve? Treasury Secretary Timothy Geithner? Or his predecessor Henry Paulson? The defense of their actions in Congressional hearings supports the impression they are heroes unto themselves.
It appears that Goldman Sachs, with a never before seen quarterly profit of $3.4B and JP Morgan with $2.7B in earnings, may be perceived as champions of Wall Street, which is also having a heck of a lot of hay days in recent weeks. Investor profiteers and those with propped-up bonuses are the ones who are able to increase the overall savings rate among Americans. It ain’t you or me. There golden eggs are again leaving the rest of us with cracked shells and empty nest eggs.
Conservative? Liberal? Who, Me?
Reader comments on this column have labeled me ‘conservative’ and ‘liberal’ but the most accurate claim might be ‘stupid’. One overly sensitive reader vowed never to waste another morning reading this dribble, disgruntled with my audacity to kindly request that the forwarding of multiple emails be discontinued because they were too frequent and the conservative views too easily predictable.
And yet, I’m never dissuaded from submitting another piece of literary babble on whatever topic flashes before my farsighted pie-eyed vision.
Let me assure you, not all of the submitted columns find their way to Hernando Today’s Voices page. There are times my ranting is justifiably trashed for they contain senseless, inconsiderate and/or a less than knowledgeable bunch of words. On a really bad day, nasty is a fitting description.
So, I wish to reinforce reader conclusions that I am indeed a flim-flam apolitical bumpkin.
Let me get Barney Frank out of the way. Did someone say, “Please!”? During the bizarre exchange between Bill O’Reilly and Sen. Frank, when the Senator was picking his fingernails, O’Reilly’s fears that universal healthcare reform would lead the nation into bankruptcy were not unexpectedly simply dismissed by Frank.
During a previous confrontation between the two, Frank denied the fact that prior to the collapse of Fannie Mae and Freddie Mac he had said the two home mortgage lending giants were “fundamentally sound” “not in danger of going under” and future investment prospects were “… going forward – very good”. This was prefaced with Frankism hindsight that Fannie and Freddie were “not the best investment these days – going back”. Today, potential cost to taxpayers is $400B in bailout funds.
If guilty of anything, South Carolina Governor Mark Sanford is justly criticized for refusing $700B in federal stimulus funds unless they could have been used to pay down state debt. When denied, the same fate followed his request to pay down $577M in school bonds. Subsequently, a unanimous state Supreme Court ruling forced him to accept the funds, saving over 7,000 teaching positions, 700 prison guard jobs and stopping the early release of 3,400 prisoners. Upset, he did a disappearing act.
Sanford’s habit of trysting the nights away to satisfy carnal cravings is a personal matter. Besides, since when is there a separation of politics and morals? Ask Bill Clinton, John Edwards, Mark Foley, Gary Hart, Eliot Spitzer and Strom Thurmond. Think too of Larry Craig’s leg. They sing in harmony, “If you can’t be with the one you love, Love the one you’re with.”
A not-so-interesting topic on the Internet are discussions that claim President Obama is the ‘anti-Christ’ with a key reference to the Chicago Republican campaign headquarters Zip Code 60606. Based on the prophesies of Nostradamus, previous interpretations have made the same claim of George W. Bush, Hillary Clinton, Rush Lambaugh, Vladmir Putin and Bin Laden. It’s all piddle prattle.
I gave up on psychic predictions forty years ago when, as foreseen in the ‘30s by the Sleeping Prophet Edgar Cayce, the Great California Earthquake failed to happen in 1969 just as Atlantis didn’t pop up out of the Atlantic Ocean in the vicinity of the Bimini Islands.
Should I now be concerned that the world as we know will end on 12-21-2012? I’ll have to ignore the predictably horrible movie ‘2012’ to be released on Friday the 13th in November.
NASA has actually stated there will be a magnetic polar shift in 2012 – of the sun, as happened in 2001. Not so scary when you read the official NASA website. Of course, you can’t trust the government. We never landed on the moon!
Of entertainers, Michael Jackson’s tragic end was unfortunate but with all the TV coverage, I hadn’t watched a single program that honored the troubled child-man until I happened upon the mainly staged memorial tribute when 11-year-old Paris Jackson gave the sweetest tear-filled farewell to her daddy.
I’ll listen to Michael’s music throughout my life but I haven’t been enticed to follow the prescribed tendency of others to overkill playing his music catalogue. The tunes of the King of Pop will endure time as surely as those of Elvis, The King.
Speaking of music, I had a conversation with a young lady at Discover Card handling a balance transfer to a lower than 14% interest rate to cover a $5K charge to replace the engine in my 14-year old truck. After listening to music-on-hold, I forewarned her that I was about to fill her ear with my personal choice of music – a clip of the techno-dance song ‘And She Said’ by Lucas Prata. She laughed with appreciation and said, “I needed that!” She wasn’t aware there’s a good 30-year difference in our ages. She didn’t know it, but it was the Rae way to make it a nicer day.
And yet, I’m never dissuaded from submitting another piece of literary babble on whatever topic flashes before my farsighted pie-eyed vision.
Let me assure you, not all of the submitted columns find their way to Hernando Today’s Voices page. There are times my ranting is justifiably trashed for they contain senseless, inconsiderate and/or a less than knowledgeable bunch of words. On a really bad day, nasty is a fitting description.
So, I wish to reinforce reader conclusions that I am indeed a flim-flam apolitical bumpkin.
Let me get Barney Frank out of the way. Did someone say, “Please!”? During the bizarre exchange between Bill O’Reilly and Sen. Frank, when the Senator was picking his fingernails, O’Reilly’s fears that universal healthcare reform would lead the nation into bankruptcy were not unexpectedly simply dismissed by Frank.
During a previous confrontation between the two, Frank denied the fact that prior to the collapse of Fannie Mae and Freddie Mac he had said the two home mortgage lending giants were “fundamentally sound” “not in danger of going under” and future investment prospects were “… going forward – very good”. This was prefaced with Frankism hindsight that Fannie and Freddie were “not the best investment these days – going back”. Today, potential cost to taxpayers is $400B in bailout funds.
If guilty of anything, South Carolina Governor Mark Sanford is justly criticized for refusing $700B in federal stimulus funds unless they could have been used to pay down state debt. When denied, the same fate followed his request to pay down $577M in school bonds. Subsequently, a unanimous state Supreme Court ruling forced him to accept the funds, saving over 7,000 teaching positions, 700 prison guard jobs and stopping the early release of 3,400 prisoners. Upset, he did a disappearing act.
Sanford’s habit of trysting the nights away to satisfy carnal cravings is a personal matter. Besides, since when is there a separation of politics and morals? Ask Bill Clinton, John Edwards, Mark Foley, Gary Hart, Eliot Spitzer and Strom Thurmond. Think too of Larry Craig’s leg. They sing in harmony, “If you can’t be with the one you love, Love the one you’re with.”
A not-so-interesting topic on the Internet are discussions that claim President Obama is the ‘anti-Christ’ with a key reference to the Chicago Republican campaign headquarters Zip Code 60606. Based on the prophesies of Nostradamus, previous interpretations have made the same claim of George W. Bush, Hillary Clinton, Rush Lambaugh, Vladmir Putin and Bin Laden. It’s all piddle prattle.
I gave up on psychic predictions forty years ago when, as foreseen in the ‘30s by the Sleeping Prophet Edgar Cayce, the Great California Earthquake failed to happen in 1969 just as Atlantis didn’t pop up out of the Atlantic Ocean in the vicinity of the Bimini Islands.
Should I now be concerned that the world as we know will end on 12-21-2012? I’ll have to ignore the predictably horrible movie ‘2012’ to be released on Friday the 13th in November.
NASA has actually stated there will be a magnetic polar shift in 2012 – of the sun, as happened in 2001. Not so scary when you read the official NASA website. Of course, you can’t trust the government. We never landed on the moon!
Of entertainers, Michael Jackson’s tragic end was unfortunate but with all the TV coverage, I hadn’t watched a single program that honored the troubled child-man until I happened upon the mainly staged memorial tribute when 11-year-old Paris Jackson gave the sweetest tear-filled farewell to her daddy.
I’ll listen to Michael’s music throughout my life but I haven’t been enticed to follow the prescribed tendency of others to overkill playing his music catalogue. The tunes of the King of Pop will endure time as surely as those of Elvis, The King.
Speaking of music, I had a conversation with a young lady at Discover Card handling a balance transfer to a lower than 14% interest rate to cover a $5K charge to replace the engine in my 14-year old truck. After listening to music-on-hold, I forewarned her that I was about to fill her ear with my personal choice of music – a clip of the techno-dance song ‘And She Said’ by Lucas Prata. She laughed with appreciation and said, “I needed that!” She wasn’t aware there’s a good 30-year difference in our ages. She didn’t know it, but it was the Rae way to make it a nicer day.
Budgeting I.O.U.s
In a recent edition of The Economist there appeared a picture of a woman holding a protest sign that read ‘A Fair and Balanced Budget Does Not Mean Cut, Cut, Cut’. If placed in front of a mirror, the word ‘austerity’ would have reflected a more realistic view of the dire state of affairs of the worsening economy.
From the presumable designer sunglasses, dangling gold earrings and a golden necklace hanging pretty around the neck, the woman appeared to be a well to do resident who doesn’t seem to grasp the frightening circumstances that face California’s economy, necessitating years of spending cuts.
With her mouth wide open as if ready for dental work, in all likelihood she was spewing hot air with a possible risk that her complexion may turn to as deep a purple hew as that of the blouse she was wearing. In protest, she could continue her stance all day long without taking a breath but it wouldn’t do any good.
California, with an astounding $26B budget deficit that grows by about $25M every day, has had to resort to issuing IOUs, an undisciplined action that will continue through September. This includes moneys due for services provided by private sector businesses plus income tax refunds due to the state’s residents.
This is no way to run a business, but there’s no business like government business and it’s no business I know of that can run up such astronomical sums of debt and continue to function – which it can’t. Just like the foolish consumer who looks in his or her wallet and sees a shortage of cash, the state has for too long resorted to increase its debt on a credit line beyond its incoming revenues.
Entrepreneurs need cash to keep their businesses afloat at a time when their very existence is already in jeopardy from the deeply troubled recession. Right on down the line, from owner to employee, these providers of services to the state government rely on a steady income to cover loan agreements, make mortgage payments, satisfy credit card debt and sustain the basic necessities for their families – namely food and electricity.
A marginal increase in bankruptcies, foreclosures and credit card default rates can be expected between now and when the IOUs are satisfied. California is out on a shaky limb but when the bow breaks Washington has said it won’t be there to catch the fall.
This past week, large banking institutions, lead by Bank of America, announced they would no longer cash the vouchers by the end of July, if not immediately. The primary reason for the policy shift is the fear that Sacramento may yet default on the payment of the registered warrants when they’re set to mature in October.
To limit the fraud potential to recipients of the IOUs needing immediate cash from third-party speculators, including offers over the Internet, the SEC stepped in to require traders be registered dealers.
California residents demonstrated how they’re fed up when they voted down measures that would have increased or extended tax hikes approved in February for another two years beyond 2011. Of the six measures on the ballot, only one passed – preventing lawmakers and public officials from receiving pay raises when the state is running a deficit.
In addition to an earlier announcement that 2000 workers would lose their jobs, another 4600 may join the ranks of the unemployed in September. Budget negotiations may also see a 5% pay cut to many state workers and furloughs of up to three days per month, which would result in a 14% loss of wages.
California is the prime example of the worsening economy and the piling up of debt, but nearly every state in the union is faced with similar budget deficits. According to the National Conference of State Legislatures, states currently have an accumulative $121B of debt, next year about $166B and a forecast of up to $180B in 2011.
The Center on Budget and Policy Priorities identifies 48 states facing budget shortfalls in 2010. Montana and North Dakota are the exceptions. Twenty-five states have increased taxes; another twelve may follow suit. No! No! No! This is exactly what deepened the severity of the Great Depression!
California debt will represent about 58% of its 2010 budget. Of the 50 states, at 22.6% of its budget, Florida isn’t expected to fair as badly as ten other states. Reduced funds for healthcare, local governments and a wide variety of services provided by states will require years of unfairly balanced budgets. And that means cut, cut, cut.
May Floridians not be California bound.
From the presumable designer sunglasses, dangling gold earrings and a golden necklace hanging pretty around the neck, the woman appeared to be a well to do resident who doesn’t seem to grasp the frightening circumstances that face California’s economy, necessitating years of spending cuts.
With her mouth wide open as if ready for dental work, in all likelihood she was spewing hot air with a possible risk that her complexion may turn to as deep a purple hew as that of the blouse she was wearing. In protest, she could continue her stance all day long without taking a breath but it wouldn’t do any good.
California, with an astounding $26B budget deficit that grows by about $25M every day, has had to resort to issuing IOUs, an undisciplined action that will continue through September. This includes moneys due for services provided by private sector businesses plus income tax refunds due to the state’s residents.
This is no way to run a business, but there’s no business like government business and it’s no business I know of that can run up such astronomical sums of debt and continue to function – which it can’t. Just like the foolish consumer who looks in his or her wallet and sees a shortage of cash, the state has for too long resorted to increase its debt on a credit line beyond its incoming revenues.
Entrepreneurs need cash to keep their businesses afloat at a time when their very existence is already in jeopardy from the deeply troubled recession. Right on down the line, from owner to employee, these providers of services to the state government rely on a steady income to cover loan agreements, make mortgage payments, satisfy credit card debt and sustain the basic necessities for their families – namely food and electricity.
A marginal increase in bankruptcies, foreclosures and credit card default rates can be expected between now and when the IOUs are satisfied. California is out on a shaky limb but when the bow breaks Washington has said it won’t be there to catch the fall.
This past week, large banking institutions, lead by Bank of America, announced they would no longer cash the vouchers by the end of July, if not immediately. The primary reason for the policy shift is the fear that Sacramento may yet default on the payment of the registered warrants when they’re set to mature in October.
To limit the fraud potential to recipients of the IOUs needing immediate cash from third-party speculators, including offers over the Internet, the SEC stepped in to require traders be registered dealers.
California residents demonstrated how they’re fed up when they voted down measures that would have increased or extended tax hikes approved in February for another two years beyond 2011. Of the six measures on the ballot, only one passed – preventing lawmakers and public officials from receiving pay raises when the state is running a deficit.
In addition to an earlier announcement that 2000 workers would lose their jobs, another 4600 may join the ranks of the unemployed in September. Budget negotiations may also see a 5% pay cut to many state workers and furloughs of up to three days per month, which would result in a 14% loss of wages.
California is the prime example of the worsening economy and the piling up of debt, but nearly every state in the union is faced with similar budget deficits. According to the National Conference of State Legislatures, states currently have an accumulative $121B of debt, next year about $166B and a forecast of up to $180B in 2011.
The Center on Budget and Policy Priorities identifies 48 states facing budget shortfalls in 2010. Montana and North Dakota are the exceptions. Twenty-five states have increased taxes; another twelve may follow suit. No! No! No! This is exactly what deepened the severity of the Great Depression!
California debt will represent about 58% of its 2010 budget. Of the 50 states, at 22.6% of its budget, Florida isn’t expected to fair as badly as ten other states. Reduced funds for healthcare, local governments and a wide variety of services provided by states will require years of unfairly balanced budgets. And that means cut, cut, cut.
May Floridians not be California bound.
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