G
overnment has been throwing all we’ve got at the economy – a stimulus package, mortgage relief programs, $700 billion bailouts, plans afoot for an auto industry bailout and another big stimulus, this one Obama’s own credit card-purchased gift to the American people.
Were government rational, driven by economic instead of political realities, Congress and the prez-elect would realize that everything they’ve tried so far has not accomplished the desired goals and would fix what’s broken before buying more broken stuff. But government’s not rational.
“An economic recovery plan will be the first thing out of the box,” Obama said shortly after his election. Since then he’s talked about infrastructure programs (as if the government isn’t already spending tens or hundreds of billions on infrastructure with no discernible effect on the economy), and $150 billion on renewable energy, as oil prices continue to drop. (Idiot alert: Yes, I know oil prices will go up again. Our focus during a crisis needs to be on the short term, however; the long term is a costly luxury we can fund once the economy is back to its fundamentals.)
I don’t know about you, but I feel like someone on Obama’s email list – hit again and again with pleas for more money, more money, more money, before I’ve had a chance to assess what he’s done with the money he’s got. Or, like the headline says, I feel more like I’ve been tasered than stimulated.
Before Congress and the prez (the waning Bush or the waxing Obama) fritter away any more, they need to assess how government’s done. Two stories this morning underline this. First, WaPo on earlier mortgage bailout programs:
Secretary of Housing and Urban Development Steve Preston said the centerpiece of the federal government’s effort to help struggling homeowners has been a failure and he’s blaming Congress.
The three-year program was supposed to help 400,000 borrowers avoid foreclosure. But it has attracted only 312 applications since its October launch because it is too expensive and onerous for lenders and borrowers alike, Preston said in an interview.
“What most people don’t understand is that this program was designed to the detail by Congress,” Preston said. “Congress dotted the i’s and crossed the t’s for us, and unfortunately it has made this program tough to use.”
That Barney Frank – chief i-dotter and t-crosser – is quoted in the piece placing the blame firmly on the administration shows how utterly inept and incapable of mature management government is. Steve Carell runs a better operation in The Office.
Whoever’s at fault, the numbers tell the tale: 400,000 customers anticipated; 312 customers in the door. In the real world, the program would be out of business, most of those working on it would be laid off, and no replacement programs would be underway until there was an understanding of what went wrong.
Part of that “what went wrong” scenario presupposes that government will be able to manage its operations, oversee its domain and fulfill its responsibilities. That’s pretty much a baseline expectation of an organization you’re going to give a few hundred billion bucks to, as we have, and as it appears we will again, and that brings me to today’s WSJ story on government’s shoddy performance in this regard:
The Securities and Exchange Commission will examine the relationship between a former official at the agency and a niece of financier Bernard L. Madoff, after the SEC’s chief admitted “apparent multiple failures” to oversee the firm at the center of an alleged $50 billion Ponzi scheme.
In an extraordinary admission that the SEC was aware of numerous red flags raised about Bernard L. Madoff Investment Securities LLC, but failed to take them seriously enough, SEC Chairman Christopher Cox ordered a review of the agency’s oversight of the New York securities-trading and investment-management firm. The review will include whether relationships between SEC officials and Mr. Madoff or his family members had any impact on the agency’s oversight.
“I am gravely concerned” by the agency’s regulation of the firm, Mr. Cox said.
Mr. Madoff’s niece, Shana Madoff, married a former SEC attorney named Eric Swanson last year. Mr. Swanson worked at the SEC for 10 years, including as a senior inspections and examination official, before leaving in 2006. Ms. Madoff is a compliance lawyer at the securities firm. …
Mr. Cox said an initial review of SEC oversight of Mr. Madoff’s firm found that “credible and specific allegations” made as far back as 1999 “were repeatedly brought to the attention of SEC staff, but were never recommended to the Commission for action.”
Mr. Cox wasn’t specific about the past claims that were inadequately investigated. But around 2000, Harry Markopolos, at the time an executive at a rival firm to Mr. Madoff’s, contacted the SEC with suspicions about Mr. Madoff’s business. “Madoff Securities is the world’s largest Ponzi scheme,” Mr. Markopolos wrote in a letter to the agency. Mr. Markopolos pursued his accusations for years, dealing with the SEC’s regional offices in New York and Boston, according to documents reviewed by The Wall Street Journal.
Holy. Moley. That’s eight years of Madoff scamming that might have been stopped if the SEC functioned as it’s supposed to function. And we’ve just handed over a few hundred billion to tihs same government to handle as it sees fit, with minimal oversight.
And worse, seeing no benefit from the first round of tasering, we’re prepping to re-charge the batteries and toss in another few hundred billion of bailout money, $20 billion of auto bailout, and another few hundred billion of Obama stimulus.
Don’t tase me, Bro! I’ve had quite enough stimulation already … quite enough:
The United States of America is bankrupt. Don’t believe it? Consider this: Federal obligations now exceed the collective net worth of all Americans, according to the New York-based Peter G. Peterson Foundation. Washington politicians and bureaucrats have essentially mortgaged everything We the People own so they can keep spending our tax dollars like there’s no tomorrow.
The foundation’s grim calculations are based on Sept. 30 consolidated federal statements, which showed that Americans’ total household net worth, diminished by falling stock prices and home equity, is $56.5 trillion. But rising costs for unfunded social programs like Medicare, Medicaid and Social Security increased to $56.4 trillion – and that was before the more recent stock market crash, $700 billion bank bailout, and monster federal deficits chalked up in October and November.
“Given more recent developments, it’s clear that America now owes more than its citizens are worth,” said Foundation president David M. Walker, the former Comptroller-General of the United States who has been trying to warn Americans of the coming financial tsunami for years, to no avail. So, after Uncle Sam bails out bankers, Wall Street gamblers, carmakers and over-their-head homeowners, who’ll bail out Uncle Sam? (DC Examiner)
Less than two weeks after Uncle Sam gave American International Group (AIG) an $85 billion loan – staving off financial collapse – execs from one of its insurance subsidiaries, AIG American General, gathered for a conference at the uber-swank St. Regis Monarch Beach Resort, billed as “California’s only Mobil Travel Guide Five-Star Resort,” where ocean-view rooms start at $565 a night and “world class luxury” is the rule.
Tables were draped with soft Tuscan-gold tablecloths that cascaded to the grass; elegant fresh flower centerpiece graced each table; and what appeared to be fine crystal stemware, at least from a distance, glistened in the fading light.
Two weeks ago, when the financial crisis hit home, the Senate Majority Leader, Democrat Harry Reid said that “no one knew what to do”. Since that time, proposals have been made to solve the problem.
