Well, the health care issue took a turn for the worst. Some people had thought that Obama would get how unpopular federal mandates are and reject this. I knew better, and I've posted as much. Obama is so convinced that Socialism is the way to go, that he thinks once Americans experience it, they will like it as much as he does. I don't fault him for this. I feel that conservativism is so good, most people will like it if they experienced it. Unfortunately, we keep getting Republicans that are not conservatives.
In terms of the game of politics, this was a good move for Obama. It gives him the ability to say he's actually accomplished something. And it gives him momentum. Of course, the health care bill isn't the end of the changes. It's going to get more and more radical as time goes on. They'll be tweeking it more until the Dems get voted out. What's somewhat unfortunate is that many of the Dems that voted for it, don't actually like it. They made a political gamble. That's pretty sad to think about it. I mean, this should be about what's best for the American people. But that's been lost. It's a game.
The Republicans are in a difficult bind here too. Though the overall bill is unpopular, many parts of it are well liked by most Americans, including Republicans. After all, the Republican health bill and Obama's did have some of the same goals. It reminds me of what happened during the Great Depression. FDR, who was also a Socialist, massively expanded government. The Reps ran against him, but supported many of the same ideas FDR was using to get us out of the Depression. The Reps had their hands tied. The "guy that got us into this mess," was Hoover. Hoover was a Republican who was not a Conservative. Hoover cut taxes, but didn't cut spending. In fact, Hoover greatly increased spending--Hoover Dam, for example. So despite actual real conservatives running against FDR, voters were still mad at Hoover (seeing all Republicans as all the same). And of course, FDR managed to stay in power, getting re-elected 4 times.
Fast forward to today, Bush cut taxes but didn't cut spending. Now people are mad at the Republicans and a socialist was able to get in the white house. Real conservatives are coming forward to oppose him. Will Newt Gengrich, Mike Huckabee, or Mit Romney be able to beat him in 2012? Or will we see more socialism until we're on the brink of collapse?
It's interesting that Dems often get unfairly labeled as "Tax and Spend Liberals," when there's a few republican presidents who've been spenders too like Hoover and Bush. The Rep and Dem labels, perhaps, aren't as important. Maybe we should be lumping people by conservative or liberal.
Now, I've been a Republican all my life. But if I saw a Conservative Democrat like JFK on the ballot against a Progressive Republican like Hoover... yeah, I think I'd have to go with the Conservative in that case.
Anyway, back to the health care thing. So Obama and the Dems gave the Congressional Budget Office a bunch of bad numbers and highly hypothetical cases and asked them to score it to see what the healthcare bill would cost. The CBO wasn't given the whole bill. That's too much to read. They were given "what the bill will do," crib notes. The Dems didn't like the answer, so they kept going back--not changing the bill each time, but changing the crib notes. Finally, they got an answer and now claim the bill will actually lower the national debt. Yeah. No one with a brain actually believes this. I highly doubt even Obama believes this claim. The CBO says the bill will cost almost a trillion dollars, but will save slightly more than it costs. Keep in mind, the Dems went to the CBO years back to get Medicare passed. The CBO scored what the bill would cost years later. The real numbers of what it really cost ended up being 13 times what the projected costs were.
Now, we spend 43 cents of every dollar paying off the national debt. Imagine it the Dems projections for the Healthcare bill is just as off from reality as it was for the Medicare bill. So instead of a trillion, the bill costs 13 times that. That would double our national debt.
So instead of paying 43% of tax dollars just paying off the debt, we'd be spending 86%. That would absolutely bankrupt this country. Now, of course even the Libs wouldn't want that to happen. So if they stayed in power, they'd have to do what Liberals always do when their grand utopia ideas end up not working in the real world--massively raise taxes, massively cut services, or commit genocide(as the most infamous of Communist / Fascist leaders have done).
Obviously, I don't think we're going to be committing genocide in this country(again). So where does that leave us? Let's look at a Conservative approach instead. Cut spending by a lot. Before FDR, federal taxes were around 5%. Now they're around 35%. 7 times more taxes, government spending has gone up more than 7 times. Here's what I think. Massively cut government spending by privatizing schools, medicare, and social security. Eliminate the Post Office too.
Elementary schools get paid money based on performance and attendance. Parents can choose which schools to send their kids to(it's free to them), so those schools had better make those parents happy if they want government money. Schools might even advertise on tv to attract more numbers. Imagine that. Opening up a well run school would even be profitable by the educators who were really good at it. Keep in mind, good neighborhood or bad wouldn't matter. The money comes from the government--not the community. This is important because a lot of intelligent, talented kids grow up in bad neighborhoods with little to no opportunity to escape poverty. This is why African Americans are disproportionately represented in sports, dance, and music. Not because they're not smart enough to be physicists and doctors--but because they either don't have the opportunity, or have lost hope to try, so they feel basketball and rapping is their only option.
Statistics now say that most newborns in this country are not white. This means if half our population will grow up feeling discriminated against, we're throwing away half our leaders, scientists, teachers, innovators, etc. Think of what well funded schools in poor neighborhoods could do for this country 20 years from now.
With a richer, better educated nation, we wouldn't need socialized medicine because more Americans would be able to afford it on their own.
Friday, March 26, 2010
Friday, February 26, 2010
Summit, spelled S. E. T. U. P.
So I watched the seven hour long, televised Health Care Summit yesterday. I actually thought it was fairly interesting. Although I agree with Republicans(duh, I am one) there, I thought the Dems did a better job at framing their vision and scoring political points.
The health care bill is vastly unpopular, despite the fact that most Americans want reform and really like some elements in the bills being discussed. Democrat voters generally highly favor the bill and are deeply irritated at Democrats in office unable to use their majority to make it happen. So the Dems needed to accomplish a few things at this summit. They needed to paint Republicans as obstructionists while building a case for why their bill was needed.
Republicans, on the other hand, needed to portray themselves as defenders of the people's will in fighting against an unpopular bill, while suggesting a different approach that will bring down costs and not raise taxes.
Again, I think the Dems did a better job. I still don't agree with them, but they were really well prepared and the Republicans just didn't shine. I'll give you an example. The philosophical differences between the two approaches are massive. Obama's plan raises taxes, forces people to buy insurance or they go to jail, and makes no clear promises to keep rates from increasing. Not to mention, the Government Option, which might lower consumer costs, could be massively expensive if manages by the inefficiencies of government.
Republicans don't want to force people to buy anything. They aren't raising taxes. And would clearly cause rates to go down. The catch; The Republican plan isn't going to do much to provide insurance for more people, other than to bring down costs. And because of this, Dems reject it. I could argue that the bad economy is the cause for why many Americans *choose* not to have health care. right now they're choosing stuff like food and car payments over insurance. But fix the economy and many of them will get coverage again.
Now, with such huge differences, you might find it weird that the Dems kept saying how close both sides were to agreeing. This is a ploy. It's a "We've made so many compromises to Republicans. We're just an inch apart. All they have to do is budge just a little bit, and pure magic will fall from the skies and everyone gets free ice cream and ponies," gimmick, and Republicans just didn't stand against that tactic. They just let the Dems get away with doing it over and over.
Obama even slipped in a comment that hinted at, "I guess you Republicans just don't care about all the people that die each year because they can't get coverage." Again, I was pretty disappointed the Dems would just wail on Republicans like that, and Reps wouldn't stand up for themselves. If I was there, I'd point out that it's true Americans might like certain elements of the Dem's plan and would like to see everyone get coverage. Then they are presented with how much it's all going to cost, then they're not in favor. After all, a major contributing factor to people not having insurance is because they can't afford it--not because it's too expensive, but because the economy has left less money in people's pockets, and has forced insurance companies to raise premiums to account for less costumers. The *last* thing Obama should be doing is passing a health care bill that hurts the economy. Let's not forget too, the benefits on the Dem's plan don't kick in for a few years, though the taxes start immediately.
Obama made one really good point against the Republican's plans, one they didn't have a counter for. If insurance companies are allowed to sell across state lines, they will relocate to the state that has the least restrictions on them, and they be able to get away with more things. Of course, nothing is stopping them from doing this now--a point no Republican challenged him on.
But in all, I would have rather Obama been more objective as a moderator. Of course, then he ran the risk of looking weak. He's already suffered politically with the belief that he let Congress do all the heavy lifting, crafting the bill in the first place, so to let his colleagues make his arguments for him, might have made him look bad. Obama needs to make his base happy. Republicans and Conservatives aren't going to like him no matter what he does. That, I think, is unfortunate. Not that I think Obama should be liked(in terms of his politics). But it's a sad reality that no president will ever be able to unite the country. We will always be polarized.
I've been thinking a lot lately of what the US would be like if you did split the country in half. Let's say we make all the left wingers move to the left half and the right, to the right. That means I have to move from California to somewhere else. Now, let's say that people don't have to stay on their side after the move, but that if people do move, they can't run for elections--thus, the leadership on each side remains.
Several things would change. Though some things, like Social Security, that might not have come about by Conservatives without Liberals creating it, will probably persist in Conservative Land. But I would bet that rulings like Roe v Wade will be over turned. In Conservative Land, Creationism will be allowed to be taught in some schools--something I would be pretty unhappy about, but that's for another rant. The big war would be between Progressive Republicans and Conservatives, but without Dems to support them, the Progressives would fail to win elections. Welcome Citizen McCain--politician no more. Conservative Land would have low taxes. Public schools would be phased out for charter schools and private run schools. Parents would get vouchers, thus forcing schools to compete for federal money. Competition would drive up efficiency. The poor would get poorer because they would get left behind without government hand outs. The rich would get richer because they'd have less taxes and restrictions. The middle class still make up most the voters, so politicians would have to be able to keep them happy, so government benefits wouldn't go away for them.
Meanwhile in Liberal Land, the country moves towards Socialized Medicine. Everyone is covered. Welfare is expanded. The poor and hungry are taken care of. Taxes sky rocket, especially for the rich, and executive salaries are capped. (sounds crazy, but Obama has been pushing for that--if you don't know that, you're not paying attention to the news.) Banks are already partially owned by the Government--that increases. GM Autos isn't the only large manufacturing company that gets bought out by the government when it fails. The Gov buys out more companies as they fail. Liberal Land has now passed every single definition of the word "Socialism"--something the US is already close to now.
Ok, what's inevitable? Well, the rich people in Liberal Land look at how awesome life is like for rich people in Conservative Land so they move there. Poor people in Conservative Land are jealous of how well poor people in Liberal Land have it, so they move. Now you have the rich and educated moving to Conservative Land, and the poor moving to Liberal Land.
Liberals, using rich tax payers as ATMs, are having a harder time doing that. This is compounded by the huge migration of the poor and uneducated that need more benefits. The economy is booming in Conservative Land, but Liberal Land is a different story. They are forced to do one of the things that every Liberal, big government has had to do through history. Russia built a wall to keep people in and committed genocide against the poor. Nazi Germany committed genocide. Communist China committed genocide at first, and slowly moved to Capitalism / Conservativism. Socialist South American countries commit genocide and wallow in poverty anyways. You get the picture.
Pure Capitalist countries haven't always fared well either. Someone might ask why Conservative Land doesn't fall back to Feudalism. We've seen many cases of countries with massive divides between rich and poor due to Conservative. This is true, but all of those situations lacked democracy. Democracy is the key.
In either case, we can see that my hypothesis isn't so far off. I live in California which is swimming in Liberalism. Despite having massive advantages over other states in terms of resources--farmland, ample port access, and huge population of skilled workers, we lag behind many other states. Oppressive taxes force businesses to often look elsewhere. Obsessions with making teachers unions happy and promising teachers job security without any incentive to be good at teaching or anything, coupled with massive salaries to super intendants and other school executives, which as far as I can see, don't actually do anything, makes California's school system one of the most expensive per student of any system in the world, and yet is dead last in terms of results among industrialized nations. Y'all know that? We're dead last. Most expensive. Worst results. Now you can see why Liberals piss me off so much.
Remember that special election Gov Schwarzenegger held to try and cut out all the crap we waste our money on? All the unions that get rich off tax payers blanketed the air with negative campaign adds and all the stuff that would have fixed the mess we're in got defeated. So now we're stuck with one of the worst economies California has ever seen. We're in a lot worse shape than the rest of the country.
Well, if I really had my way, we'd ship all the Liberals off to Europe where they can have all the socialism they want. The US is the country we are now because of Conservatism.
The health care bill is vastly unpopular, despite the fact that most Americans want reform and really like some elements in the bills being discussed. Democrat voters generally highly favor the bill and are deeply irritated at Democrats in office unable to use their majority to make it happen. So the Dems needed to accomplish a few things at this summit. They needed to paint Republicans as obstructionists while building a case for why their bill was needed.
Republicans, on the other hand, needed to portray themselves as defenders of the people's will in fighting against an unpopular bill, while suggesting a different approach that will bring down costs and not raise taxes.
Again, I think the Dems did a better job. I still don't agree with them, but they were really well prepared and the Republicans just didn't shine. I'll give you an example. The philosophical differences between the two approaches are massive. Obama's plan raises taxes, forces people to buy insurance or they go to jail, and makes no clear promises to keep rates from increasing. Not to mention, the Government Option, which might lower consumer costs, could be massively expensive if manages by the inefficiencies of government.
Republicans don't want to force people to buy anything. They aren't raising taxes. And would clearly cause rates to go down. The catch; The Republican plan isn't going to do much to provide insurance for more people, other than to bring down costs. And because of this, Dems reject it. I could argue that the bad economy is the cause for why many Americans *choose* not to have health care. right now they're choosing stuff like food and car payments over insurance. But fix the economy and many of them will get coverage again.
Now, with such huge differences, you might find it weird that the Dems kept saying how close both sides were to agreeing. This is a ploy. It's a "We've made so many compromises to Republicans. We're just an inch apart. All they have to do is budge just a little bit, and pure magic will fall from the skies and everyone gets free ice cream and ponies," gimmick, and Republicans just didn't stand against that tactic. They just let the Dems get away with doing it over and over.
Obama even slipped in a comment that hinted at, "I guess you Republicans just don't care about all the people that die each year because they can't get coverage." Again, I was pretty disappointed the Dems would just wail on Republicans like that, and Reps wouldn't stand up for themselves. If I was there, I'd point out that it's true Americans might like certain elements of the Dem's plan and would like to see everyone get coverage. Then they are presented with how much it's all going to cost, then they're not in favor. After all, a major contributing factor to people not having insurance is because they can't afford it--not because it's too expensive, but because the economy has left less money in people's pockets, and has forced insurance companies to raise premiums to account for less costumers. The *last* thing Obama should be doing is passing a health care bill that hurts the economy. Let's not forget too, the benefits on the Dem's plan don't kick in for a few years, though the taxes start immediately.
Obama made one really good point against the Republican's plans, one they didn't have a counter for. If insurance companies are allowed to sell across state lines, they will relocate to the state that has the least restrictions on them, and they be able to get away with more things. Of course, nothing is stopping them from doing this now--a point no Republican challenged him on.
But in all, I would have rather Obama been more objective as a moderator. Of course, then he ran the risk of looking weak. He's already suffered politically with the belief that he let Congress do all the heavy lifting, crafting the bill in the first place, so to let his colleagues make his arguments for him, might have made him look bad. Obama needs to make his base happy. Republicans and Conservatives aren't going to like him no matter what he does. That, I think, is unfortunate. Not that I think Obama should be liked(in terms of his politics). But it's a sad reality that no president will ever be able to unite the country. We will always be polarized.
I've been thinking a lot lately of what the US would be like if you did split the country in half. Let's say we make all the left wingers move to the left half and the right, to the right. That means I have to move from California to somewhere else. Now, let's say that people don't have to stay on their side after the move, but that if people do move, they can't run for elections--thus, the leadership on each side remains.
Several things would change. Though some things, like Social Security, that might not have come about by Conservatives without Liberals creating it, will probably persist in Conservative Land. But I would bet that rulings like Roe v Wade will be over turned. In Conservative Land, Creationism will be allowed to be taught in some schools--something I would be pretty unhappy about, but that's for another rant. The big war would be between Progressive Republicans and Conservatives, but without Dems to support them, the Progressives would fail to win elections. Welcome Citizen McCain--politician no more. Conservative Land would have low taxes. Public schools would be phased out for charter schools and private run schools. Parents would get vouchers, thus forcing schools to compete for federal money. Competition would drive up efficiency. The poor would get poorer because they would get left behind without government hand outs. The rich would get richer because they'd have less taxes and restrictions. The middle class still make up most the voters, so politicians would have to be able to keep them happy, so government benefits wouldn't go away for them.
Meanwhile in Liberal Land, the country moves towards Socialized Medicine. Everyone is covered. Welfare is expanded. The poor and hungry are taken care of. Taxes sky rocket, especially for the rich, and executive salaries are capped. (sounds crazy, but Obama has been pushing for that--if you don't know that, you're not paying attention to the news.) Banks are already partially owned by the Government--that increases. GM Autos isn't the only large manufacturing company that gets bought out by the government when it fails. The Gov buys out more companies as they fail. Liberal Land has now passed every single definition of the word "Socialism"--something the US is already close to now.
Ok, what's inevitable? Well, the rich people in Liberal Land look at how awesome life is like for rich people in Conservative Land so they move there. Poor people in Conservative Land are jealous of how well poor people in Liberal Land have it, so they move. Now you have the rich and educated moving to Conservative Land, and the poor moving to Liberal Land.
Liberals, using rich tax payers as ATMs, are having a harder time doing that. This is compounded by the huge migration of the poor and uneducated that need more benefits. The economy is booming in Conservative Land, but Liberal Land is a different story. They are forced to do one of the things that every Liberal, big government has had to do through history. Russia built a wall to keep people in and committed genocide against the poor. Nazi Germany committed genocide. Communist China committed genocide at first, and slowly moved to Capitalism / Conservativism. Socialist South American countries commit genocide and wallow in poverty anyways. You get the picture.
Pure Capitalist countries haven't always fared well either. Someone might ask why Conservative Land doesn't fall back to Feudalism. We've seen many cases of countries with massive divides between rich and poor due to Conservative. This is true, but all of those situations lacked democracy. Democracy is the key.
In either case, we can see that my hypothesis isn't so far off. I live in California which is swimming in Liberalism. Despite having massive advantages over other states in terms of resources--farmland, ample port access, and huge population of skilled workers, we lag behind many other states. Oppressive taxes force businesses to often look elsewhere. Obsessions with making teachers unions happy and promising teachers job security without any incentive to be good at teaching or anything, coupled with massive salaries to super intendants and other school executives, which as far as I can see, don't actually do anything, makes California's school system one of the most expensive per student of any system in the world, and yet is dead last in terms of results among industrialized nations. Y'all know that? We're dead last. Most expensive. Worst results. Now you can see why Liberals piss me off so much.
Remember that special election Gov Schwarzenegger held to try and cut out all the crap we waste our money on? All the unions that get rich off tax payers blanketed the air with negative campaign adds and all the stuff that would have fixed the mess we're in got defeated. So now we're stuck with one of the worst economies California has ever seen. We're in a lot worse shape than the rest of the country.
Well, if I really had my way, we'd ship all the Liberals off to Europe where they can have all the socialism they want. The US is the country we are now because of Conservatism.
Saturday, January 30, 2010
Recovery or Calm Before the Storm?
Some economists are now predicting a double dip recession. That means, a brief period of relief like we're starting to experience now, then a second, worse recession soon after. Why is this even happening in the first place? Well, like most things in macro economics, it's complicated.
Many blame Bush. And why not? The recession started around mid 2007. He was President at the time. Clearly, anything that goes wrong is the fault of who ever is president at the time. So what is it that Bush did that caused it? If you ask people, you'll either get a "i dunno" or people will tell you that Bush spent tons of money fighting two wars unpaid for and cut taxes across the board(that means for everyone poor to rich). So, he essentially hired tons more soldiers and pumped a lot of money into bomb, gun, and tank manufacturing companies increasing jobs then he cut taxes for all Americans so people had more money in their wallets. Well, I can certainly see how that results in deficit spending and increases the national debt(which is bad for the government). But that should actually HELP the economy, not hurt it. So how on Earth could that have possibly created the recession?
Ok, then how about the fact that the greedy wall street bankers... um... did something and got rich in some way I don't understand and Bush just let them do it? Huh? How about that?! See, what actually allowed banks to give so many loans to people that couldn't otherwise pay them bank was the lifting of restrictions that occurred during the Clinton administration. Of course, it's a stretch trying to blame Clinton for something that happened about a decade later. But that's the thing with macro economics, it's not just one thing that causes a problem. It's a chain of things.
I recently watched a couple of interviews from Ben Bernanke. In 2006, after recently replacing Alan Greenspan as Chairman of the Federal Reserve, he predicted that 2008 would see huge growth in the economy. Keep in mind, as Chairman of the Federal Reserve, this is the top and most respected economist in the world. Even if Bush was a rocket scientist, how could he possibly doubt what Bernanke was saying? Keep in mind also that the Democrats had taken over control of Congress by 2006 and everyone was predicting growth in the housing market.
Many Democrats, meaning well, wanted to see poor people that couldn't otherwise afford a house, be able to buy one now before homes increased in value. Banks were being subsidized(that means our government gives them tax payer dollars to do something) to give loans to people that couldn't otherwise pay. This was a crazy period of time. I knew a couple people that were buying multiple houses--people that wouldn't otherwise be able to buy one, now had several. Some banks made loans for no money down. That means literally homeless people could get loans they'd never be able to pay back. Banks didn't care. The government was giving out "free money" to make it happen. How can you argue with that?
Also remember, Congress does not need Presidential approval to sign off on the federal budget. In fact, if Bush wanted to stop the Democrats in Congress from doing whatever they wanted with the budget, he can't. Restrictions on banks had been lifted for a decade now under a Democrat president, and now Democrats in Congress were bankrolling loans to people that couldn't pay them back.
So what went wrong? The buying frenzy ended and houses plummeted in value. Instead of increasing, homes were now worth less than the money people paid for them. These same people that put no money down in the first place, had nothing to lose for walking away. That meant banks got stuck with the balance, owing a lot of money for homes that were no longer worth what they cost.
In short, banks lost their butts and went into survival mode. That means, they stopped loaning to anyone else, and just tried to hang on. When the banks stopped loaning, existing businesses could no longer expand and new businesses could no longer get the capital to start up. Meanwhile, the natural attrition of existing businesses collapsed meaning more lay offs with no new jobs for people to move to. This started driving up unemployment and thus, here we are now.
It's interesting how the recession has been blamed on Bush when, if you have even the slightest idea about what's going on, simply isn't entirely true. It's also interesting that Obama talks about how he didn't create this mess we're in. But he, and his Democrat colleagues controlled Congress at the time and they were the ones subsidizing banks to give out loans to people that couldn't afford them which created this mess. I can try and make the argument that Obama is actually more to blame for the recession than Bush was. Well, the Senate is half of Congress and Obama was just one of 100 senators, so that only made him 0.5% responsible for what Congress did. Heh, ok, so it's a really small percent, but still...
But who really knows? As I said, the truth is usually a lot more complicated. Not to mention, I'm obviously not able to go through all the bills and budget sheets that Congress votes on(some of which isn't always public), so I have to rely on what journalists say--and I've made a recent blog about how biased they are. I'm well aware that journalists push their agendas and cherry pick facts to make their stories more interesting even if it means object (boring) truth suffers. I highly doubt the issue is as simple as "The Democrats did it! Get 'em!" as I've made it sound. All I'm trying to say is that idiots who've barely done any research on anything need to stop going around like they have a clue. And all you damn Democrats in California, stop canceling out my votes! Heh.
Oh yeah, and Ben Bernanke, the top economist in the country that was so horribly wrong about predicting growth in 2008... Obama just appointed him for a second, four year term. It's very possible that Bernanke wasn't wrong. Rather all things considered, 2008 would have been prosperous only he didn't predict Congress(the Democrats) messing around with the banking system and causing the crash. I recently read that Obama's bail out of the banks, although eased the economic pain in the short run, might lead to the cycle to repeat itself in the near future. I mean, after all, the Democrats are still bailing out the banks and subsidizing them to make loans again. The banks know no matter how reckless they remain, Obama will still bail them out. This leads to another economic principle known as Tragedy of the Commons.
Normally ToC means a group of companies that share a common resource. Let's say timber logging companies that cut trees from the same forest. Take away all restrictions, and the faster a company cuts down the trees, the more trees they will get before their competitors get them. Now, if it was just one logging company, they'd be able to conserve the trees. But since it's many companies, going slow is economic suicide.
Now not all banks gave out loans recklessly. Many stayed responsible, but in this climate, being responsible is economic suicide. After all, if Bank A gives out loans to everyone with little restrictions, why would you go to responsible Bank B? Why would Bank A be responsible if they know Obama will just bail them out? Can responsible Bank B compete against banks like Bank A that can be as reckless as they want? Keep in mind, Obama isn't bailing out all the banks, just the big ones that gave loans recklessly are being "rewarded" with bail outs. Isn't that some messed up backwards crap?
It's like, we're never going to get out of this recession until the Democrats learn to leave Capitalism the hell alone and let it work on it's own, or we get Republicans in Congress again. I really don't care which party has the White House(that doesn't seem to matter that much), just get the damn Democrats out of Congress before we become a third world country.
Many blame Bush. And why not? The recession started around mid 2007. He was President at the time. Clearly, anything that goes wrong is the fault of who ever is president at the time. So what is it that Bush did that caused it? If you ask people, you'll either get a "i dunno" or people will tell you that Bush spent tons of money fighting two wars unpaid for and cut taxes across the board(that means for everyone poor to rich). So, he essentially hired tons more soldiers and pumped a lot of money into bomb, gun, and tank manufacturing companies increasing jobs then he cut taxes for all Americans so people had more money in their wallets. Well, I can certainly see how that results in deficit spending and increases the national debt(which is bad for the government). But that should actually HELP the economy, not hurt it. So how on Earth could that have possibly created the recession?
Ok, then how about the fact that the greedy wall street bankers... um... did something and got rich in some way I don't understand and Bush just let them do it? Huh? How about that?! See, what actually allowed banks to give so many loans to people that couldn't otherwise pay them bank was the lifting of restrictions that occurred during the Clinton administration. Of course, it's a stretch trying to blame Clinton for something that happened about a decade later. But that's the thing with macro economics, it's not just one thing that causes a problem. It's a chain of things.
I recently watched a couple of interviews from Ben Bernanke. In 2006, after recently replacing Alan Greenspan as Chairman of the Federal Reserve, he predicted that 2008 would see huge growth in the economy. Keep in mind, as Chairman of the Federal Reserve, this is the top and most respected economist in the world. Even if Bush was a rocket scientist, how could he possibly doubt what Bernanke was saying? Keep in mind also that the Democrats had taken over control of Congress by 2006 and everyone was predicting growth in the housing market.
Many Democrats, meaning well, wanted to see poor people that couldn't otherwise afford a house, be able to buy one now before homes increased in value. Banks were being subsidized(that means our government gives them tax payer dollars to do something) to give loans to people that couldn't otherwise pay. This was a crazy period of time. I knew a couple people that were buying multiple houses--people that wouldn't otherwise be able to buy one, now had several. Some banks made loans for no money down. That means literally homeless people could get loans they'd never be able to pay back. Banks didn't care. The government was giving out "free money" to make it happen. How can you argue with that?
Also remember, Congress does not need Presidential approval to sign off on the federal budget. In fact, if Bush wanted to stop the Democrats in Congress from doing whatever they wanted with the budget, he can't. Restrictions on banks had been lifted for a decade now under a Democrat president, and now Democrats in Congress were bankrolling loans to people that couldn't pay them back.
So what went wrong? The buying frenzy ended and houses plummeted in value. Instead of increasing, homes were now worth less than the money people paid for them. These same people that put no money down in the first place, had nothing to lose for walking away. That meant banks got stuck with the balance, owing a lot of money for homes that were no longer worth what they cost.
In short, banks lost their butts and went into survival mode. That means, they stopped loaning to anyone else, and just tried to hang on. When the banks stopped loaning, existing businesses could no longer expand and new businesses could no longer get the capital to start up. Meanwhile, the natural attrition of existing businesses collapsed meaning more lay offs with no new jobs for people to move to. This started driving up unemployment and thus, here we are now.
It's interesting how the recession has been blamed on Bush when, if you have even the slightest idea about what's going on, simply isn't entirely true. It's also interesting that Obama talks about how he didn't create this mess we're in. But he, and his Democrat colleagues controlled Congress at the time and they were the ones subsidizing banks to give out loans to people that couldn't afford them which created this mess. I can try and make the argument that Obama is actually more to blame for the recession than Bush was. Well, the Senate is half of Congress and Obama was just one of 100 senators, so that only made him 0.5% responsible for what Congress did. Heh, ok, so it's a really small percent, but still...
But who really knows? As I said, the truth is usually a lot more complicated. Not to mention, I'm obviously not able to go through all the bills and budget sheets that Congress votes on(some of which isn't always public), so I have to rely on what journalists say--and I've made a recent blog about how biased they are. I'm well aware that journalists push their agendas and cherry pick facts to make their stories more interesting even if it means object (boring) truth suffers. I highly doubt the issue is as simple as "The Democrats did it! Get 'em!" as I've made it sound. All I'm trying to say is that idiots who've barely done any research on anything need to stop going around like they have a clue. And all you damn Democrats in California, stop canceling out my votes! Heh.
Oh yeah, and Ben Bernanke, the top economist in the country that was so horribly wrong about predicting growth in 2008... Obama just appointed him for a second, four year term. It's very possible that Bernanke wasn't wrong. Rather all things considered, 2008 would have been prosperous only he didn't predict Congress(the Democrats) messing around with the banking system and causing the crash. I recently read that Obama's bail out of the banks, although eased the economic pain in the short run, might lead to the cycle to repeat itself in the near future. I mean, after all, the Democrats are still bailing out the banks and subsidizing them to make loans again. The banks know no matter how reckless they remain, Obama will still bail them out. This leads to another economic principle known as Tragedy of the Commons.
Normally ToC means a group of companies that share a common resource. Let's say timber logging companies that cut trees from the same forest. Take away all restrictions, and the faster a company cuts down the trees, the more trees they will get before their competitors get them. Now, if it was just one logging company, they'd be able to conserve the trees. But since it's many companies, going slow is economic suicide.
Now not all banks gave out loans recklessly. Many stayed responsible, but in this climate, being responsible is economic suicide. After all, if Bank A gives out loans to everyone with little restrictions, why would you go to responsible Bank B? Why would Bank A be responsible if they know Obama will just bail them out? Can responsible Bank B compete against banks like Bank A that can be as reckless as they want? Keep in mind, Obama isn't bailing out all the banks, just the big ones that gave loans recklessly are being "rewarded" with bail outs. Isn't that some messed up backwards crap?
It's like, we're never going to get out of this recession until the Democrats learn to leave Capitalism the hell alone and let it work on it's own, or we get Republicans in Congress again. I really don't care which party has the White House(that doesn't seem to matter that much), just get the damn Democrats out of Congress before we become a third world country.
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