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Thread: Obama's Temporary Measures looking Permanent

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    Default Obama's Temporary Measures looking Permanent

    Obama and the Dems have worked overtime to mix and blend government and private capitalism. Whether it is called socialism or statism, Obama and the Dems have asserted politics to be primary over economics. Exhibit A is the non-stimulating "Stimulus" package , 85 % of which remains unspent. Exhibit B is "Cash for Clunkers" and the clincher was TARP for GM, Chrysler and AIG.

    Otherwise why did the Senate defeat Sen. Alexander's bill to distribute to 120 million taxpayers the stock that the government holds in GM and Chrysler ? And if they defeat Corker-Warner then it will be clear beyond all doubt that the Dems like Obama, Pelosi and Fwank really think it is their mission and purpose to "arrange'' things.

    Thanks to George Will who in his most recent column reminded me of Saul Bellow's novel "HUMBOLDT'S GIFT": " (Life) had to be arranged." The intelligentsia saw it as their duty to arrange life for everyone. "A man like Humboldt, inspired ,shrewd, nutty, was brimming over with the discovery that the human enterprise, so grand and infinitely varied, had now to be managed by exceptional persons. He was an exceptional person, therefore he was an eligible candidate for power."

    Today we have our own Humboldts like Fwank and Emanuel with their uncontrolled excitement at the crisis created opportunity to arrange American life.Remember what Emanuel said : "A crisis is a terrible thing to waste."

    Obama SAYS that Americans are "reluctant shareholders" of GM, Chrysler, AIG and Citigroup BUT he has also tried to tell us many other things that he obviously does not believe:" A public option will not injure private insurers; that cap and trade will raise energy costs without harming the economy; that 15% of the stimulus that actually got spent helped end the recession" etc. etc.

    When, not if,but WHEN their meddling becomes more and more counter-productive will the Dems be able to say: "STOP ! Fall back !' and let the private sector do it's job ? Doubtful. Cats don't bark.

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    Default Re: Obama's Temporary Measures looking Permanent

    by sheer coincidence, the following was just released by the Obama administration ...

    (snip)Aug. 25 (Bloomberg) -- U.S. unemployment will surge to 10 percent this year and the budget deficit will be $1.5 trillion next year, both higher than previous Obama administration forecasts because of a recession that was deeper and longer than expected, White House budget chief Peter Orszag said.

    The Office of Management and Budget forecasts that the U.S. economy will shrink 2.8 percent this year, worse than the 1.2 percent contraction the OMB projected in May. For next year, the budget office said the gross domestic product will grow 2.0 percent, less than the 3.2 percent expected in May. By 2011, the economy would be well on its way to recovery, growing at a 3.8 percent annual rate, according to the administration’s mid-year economic review, released this morning.

    “While the danger of the economy immediately falling into a deep recession has receded, the American economy is still in the midst of a serious economic downturn,” the budget office’s report said. “The long-term deficit outlook remains daunting.”

    Separately, the nonpartisan Congressional Budget Office today predicted that the jobless rate would average 10.2 percent next year, gloomier than the White House projection, and forecast the deficit for this year at $1.6 trillion, slightly worse than the White House estimate.

    Impact on Agenda

    The budget shortfall for 2010 would mark the second straight year of trillion-dollar deficits. Along with the unemployment numbers, the deficit may weigh down President Barack Obama’s drive for his top domestic priority, overhauling the U.S. health care system.

    “It throws a wrench in health-care reforms,” Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget, said in an interview before the report was released. “No matter the specific numbers, they’re a constant reminder that we’re in bad, bad shape.”

    House Republican Leader John Boehner of Ohio seized on the numbers to call for the Democrat-controlled Congress to impose “strict annual caps on federal spending.”

    The health-care overhaul “is just the latest in a long line of expensive Democratic experiments that will add to the deficit, raise taxes on families and small businesses and cost more American jobs,” Boehner said in a statement.

    Slower Growth

    The projected deficit for the fiscal year that begins Oct. 1 is higher than the $1.26 trillion forecast in May and reflects expectations that economic growth will be slower this year and next because of “the severity of the crisis in the U.S. and in our trading partners,” said Christina Romer, White House chief economist, who along with Orszag briefed reporters on the report.

    The administration said last week that the deficit for the 2009 fiscal year, which ends Sept. 30, will peak this year at $1.58 trillion before narrowing over next decade. That is less than the $1.84 trillion projected in May because budget officials were able to delete hundreds of billions of dollars that had been set aside for bank bailouts.

    Last year’s deficit was $459 billion.

    Over the next decade, the budget picture is darker, with the 10-year deficit reaching $9.05 trillion, up from $7.1 trillion forecast in May, the budget office said Aug. 19."(snip)

    from


    and this response from Senator Grassley ...

    (snip)"The economy could spiral into hyperinflation not seen since the early 1980s if the Federal Reserve does not tighten its monetary policy soon, Sen. Chuck Grassley (R-Iowa) warned Tuesday.

    Grassley, speaking about the renomination of Federal Reserve Chairman Ben Bernanke to a second term as head of the Fed, asserted that Bernanke's ability to hold down inflation would be the metric by which the Fed's success would be measured.

    "We won't know for a year if he's done a good job so far, because he shoveled money out of an airplane to save banks and the financial system," Grassley said in a conference call with Iowa reporters. "But shoveling money out of an airplane to solve problems can be inflationary — in this case, hyperinflationary — if he doesn't start mopping up some of the money that's out there."

    Grassley, the ranking member of the Senate Finance Committee, said that inflation as a result from government spending on bailouts could result in inflation rivaling rates in 1980, when it hit a peak of 13.5 percent."(snip)

    from


    I would add that a significant portion of the ( originally ) $787 billion in federal stimulus spending is actually being directed toward helping many states pay for unemployment insurance checks, medicaid benefits, school system payrolls, road / bridge repairs and other purely 'maintenance' work which are actually the responsibility of the states. This amounts to a wealth transfer from fiscally responsible states ( most of which are red ) to fiscally irresponsible states (most of which are blue). And because the welfare / medicaid / unemployment transfer payments are formula based, the actual cost of the federal stimulus package continues to rise above the originally approved $787 billion !

    I would also point out the announcement of a new clunkers-like program to subsidize appliance purchases with federal taxpayer money in a manner similar to the cash for clunkers program itself subsidizing new car purchases with federal taxpayer money. The kicker for both of these programs, of course, is that they are financed by the future income taxes of Americans who actually have to pay federal income tax ... which is barely a majority of those filing federal tax returns these days. As such, this amounts to another wealth transfer from productive Americans earning more than $40k a year ( or so ) to less productive Americans ( most of whom vote blue ).

    ~
    Last edited by Melonie; 08-25-2009 at 09:55 AM.

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    Default Re: Obama's Temporary Measures looking Permanent

    Quote Originally Posted by Melonie View Post
    by sheer coincidence, the following was just released by the Obama administration ...

    (snip)Aug. 25 (Bloomberg) -- U.S. unemployment will surge to 10 percent this year and the budget deficit will be $1.5 trillion next year, both higher than previous Obama administration forecasts because of a recession that was deeper and longer than expected, White House budget chief Peter Orszag said.

    The Office of Management and Budget forecasts that the U.S. economy will shrink 2.8 percent this year, worse than the 1.2 percent contraction the OMB projected in May. For next year, the budget office said the gross domestic product will grow 2.0 percent, less than the 3.2 percent expected in May. By 2011, the economy would be well on its way to recovery, growing at a 3.8 percent annual rate, according to the administration’s mid-year economic review, released this morning.

    “While the danger of the economy immediately falling into a deep recession has receded, the American economy is still in the midst of a serious economic downturn,” the budget office’s report said. “The long-term deficit outlook remains daunting.”

    Separately, the nonpartisan Congressional Budget Office today predicted that the jobless rate would average 10.2 percent next year, gloomier than the White House projection, and forecast the deficit for this year at $1.6 trillion, slightly worse than the White House estimate.

    Impact on Agenda

    The budget shortfall for 2010 would mark the second straight year of trillion-dollar deficits. Along with the unemployment numbers, the deficit may weigh down President Barack Obama’s drive for his top domestic priority, overhauling the U.S. health care system.

    “It throws a wrench in health-care reforms,” Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget, said in an interview before the report was released. “No matter the specific numbers, they’re a constant reminder that we’re in bad, bad shape.”

    House Republican Leader John Boehner of Ohio seized on the numbers to call for the Democrat-controlled Congress to impose “strict annual caps on federal spending.”

    The health-care overhaul “is just the latest in a long line of expensive Democratic experiments that will add to the deficit, raise taxes on families and small businesses and cost more American jobs,” Boehner said in a statement.

    Slower Growth

    The projected deficit for the fiscal year that begins Oct. 1 is higher than the $1.26 trillion forecast in May and reflects expectations that economic growth will be slower this year and next because of “the severity of the crisis in the U.S. and in our trading partners,” said Christina Romer, White House chief economist, who along with Orszag briefed reporters on the report.

    The administration said last week that the deficit for the 2009 fiscal year, which ends Sept. 30, will peak this year at $1.58 trillion before narrowing over next decade. That is less than the $1.84 trillion projected in May because budget officials were able to delete hundreds of billions of dollars that had been set aside for bank bailouts.

    Last year’s deficit was $459 billion.

    Over the next decade, the budget picture is darker, with the 10-year deficit reaching $9.05 trillion, up from $7.1 trillion forecast in May, the budget office said Aug. 19."(snip)

    from http://www.bloomberg.com/apps/news?p...d=aNaqecavD9ek


    and this response from Senator Grassley ...

    (snip)"The economy could spiral into hyperinflation not seen since the early 1980s if the Federal Reserve does not tighten its monetary policy soon, Sen. Chuck Grassley (R-Iowa) warned Tuesday.

    Grassley, speaking about the renomination of Federal Reserve Chairman Ben Bernanke to a second term as head of the Fed, asserted that Bernanke's ability to hold down inflation would be the metric by which the Fed's success would be measured.

    "We won't know for a year if he's done a good job so far, because he shoveled money out of an airplane to save banks and the financial system," Grassley said in a conference call with Iowa reporters. "But shoveling money out of an airplane to solve problems can be inflationary — in this case, hyperinflationary — if he doesn't start mopping up some of the money that's out there."

    Grassley, the ranking member of the Senate Finance Committee, said that inflation as a result from government spending on bailouts could result in inflation rivaling rates in 1980, when it hit a peak of 13.5 percent."(snip)

    from http://briefingroom.thehill.com/2009...ing-the-1980s/


    I would add that a significant portion of the ( originally ) $787 billion in federal stimulus spending is actually being directed toward helping many states pay for unemployment insurance checks, medicaid benefits, school system payrolls, road / bridge repairs and other purely 'maintenance' work which are actually the responsibility of the states. This amounts to a wealth transfer from fiscally responsible states ( most of which are red ) to fiscally irresponsible states (most of which are blue). And because the welfare / medicaid / unemployment transfer payments are formula based, the actual cost of the federal stimulus package continues to rise above the originally approved $787 billion !

    I would also point out the announcement of a new clunkers-like program to subsidize appliance purchases with federal taxpayer money in a manner similar to the cash for clunkers program itself subsidizing new car purchases with federal taxpayer money. The kicker for both of these programs, of course, is that they are financed by the future income taxes of Americans who actually have to pay federal income tax ... which is barely a majority of those filing federal tax returns these days. As such, this amounts to another wealth transfer from productive Americans earning more than $40k a year ( or so ) to less productive Americans ( most of whom vote blue ).

    ~
    This is why Obama and the Dems were racing to try and get their health plan passed BEFORE this economic news became public. They knew all along that the economic and budget numbers would be bad and knew that the American people would not accept another trillion dollars of debt. Not without a reversal of the budget trajectory which obviously is not going to happen.

    I haven't even touched on the grave Constitutional issues involved. For instance, where is Obama empowered to take over a car company ?
    Last edited by Eric Stoner; 08-29-2009 at 01:00 PM.

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    Default Re: Obama's Temporary Measures looking Permanent

    Do you have to quote in its entirety a previous post in this thread? It's not as if we can't scroll up for reference.

    About the auto companies aspect of this speculation: tell me again the choices you believe he had, and why the one he took was the complete inevitably wrong one.
    Last edited by threlayer; 08-29-2009 at 11:06 PM.
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    Default Re: Obama's Temporary Measures looking Permanent

    I admit I didn't read this whole thread but, since it's relavant I am currently doing loan mods and I will help anyone that needs to redo their mortgage (for free) by directing you to do it yourself if you are someone that I know and you PM me.
    XoXo Gia
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    Default Re: Obama's Temporary Measures looking Permanent

    Quote Originally Posted by threlayer View Post
    Do you have to quote in its entirity a previous post in this thread? It's not as if we can't scroll up for reference.

    About the auto companies aspect of this speculation: tell me again the choices you believe he had, and why the one he took was the complete inevitably wrong one.
    You can never read too much of Melonie's stuff.

    Obama could have and should have let GM and Chrysler go into bankruptcy without screwing the bondholders and without the government becoming a shareholder.

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    Default Re: Obama's Temporary Measures looking Permanent

    ^^ If I have to read it twice that is too much. It is already long enough.

    So the govt. could have let their employees and creditors goto hell so Obama's crew would have avoided making you think they really want to own auto manufacturers, over-burdenng them with management details and risking losing the entire mess?

    I guess some people here just cannot give any Democrat any credit for trying to do good things for the public at all. It seems well beyond their capabilities and concerns.

    It does make life just a bit more amusing to me, so that's OK. I just look at how thoroughly screwed up the last eight years have been and realize it's the outlook of those people who think that went pretty well. LOL
    Last edited by threlayer; 08-30-2009 at 09:22 AM.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Default Re: Obama's Temporary Measures looking Permanent

    ^^^ yeah, well, here is what a portion of the US taxpayer investment in General Motors is now being used for ...



    (snip)"Aug. 30 (Bloomberg) -- General Motors Co., China’s largest overseas automaker, formed a 50-50 joint venture with China FAW Group Corp. to make light trucks and vans in the country as it aims to offset plunging U.S. vehicle demand.

    The venture between Detroit-based GM and FAW has a total investment of 2 billion yuan ($293 million), GM said in a statement today. The companies signed a memorandum of understanding in November 2007 and received Chinese government approval in July, GM said.

    The partnership with FAW, called FAW-GM Light Duty Commercial Vehicle Co., will be GM’s third joint venture with a local automaker. General Motors is betting on China, its second-biggest market, for growth as demand for its vehicles tumbled 38 percent in the U.S. this year through July, compared with a 43 percent sales increase in China.

    “The competition in this segment is fierce, it’s not going to be easy to make this venture successful,” Zhang Xin, a Guotai Junan Securities Co. analyst in Beijing, said in a phone interview. “Neither GM nor FAW is that strong in light commercial vehicles.”

    Trucks and vans will be built at FAW’s factories in south China’s Yunnan province and Harbin city in the north east. They have a total capacity of 100,000 units. The construction of a new plant in Harbin is under way and will add another 100,000 vehicles to the venture’s total annual capacity by the end of next year, GM China President Kevin Wale said today.

    Sales Forecast

    The venture aims to sell between 80,000 and 90,000 vehicles this year and 100,000 next year, he added. It may export the products overseas should there be demand.

    GM now makes passenger cars in China with SAIC Motor Corp., China’s largest domestic automaker, in an equally owned joint venture. That partnership, Shanghai General Motors Co., boosted sales 26 percent in the first seven months to 345,332 vehicles, helped by government stimulus programs aimed at spurring auto sales.

    The U.S. automaker also makes minivans in a venture with SAIC Motor and Liuzhou Wuling Motors Co. SAIC-GM-Wuling Automobile Co. sold more than 600,000 units in the first seven months."(snip)

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    Default Re: Obama's Temporary Measures looking Permanent

    ^^^ The people who are still working in GM plants in the good ole USA might say...so what?

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    Default Re: Obama's Temporary Measures looking Permanent

    ^^^ well, the US taxpayers who are in fact financing this investment might have a different opinion. Future US GM workers may also have a different opinion when a plethora of foreign built models start being imported into the US market rather than domestically produced ( which is already the case with the Korean joint venture Chevy Aveo )

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    Default Re: Obama's Temporary Measures looking Permanent

    No matter where the money comes from, GM is still making mistakes with it. They've been doing that since before the early sixties in my opinion. But I guess they need to survive just the same.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Default Re: Obama's Temporary Measures looking Permanent

    According to the front page of today's New York Times : The Federal government is now America's biggest lender; insurer; automaker and financial guarantor.

    Government spending is now 26% of GDP. Larger than at any time since W.W. II.

    The government is now financing 9 out of 10 new mortgages.

    The government owns 60 % of GM and 80% of AIG

    When Clinton left office, the Federal government consumed 18.5% of GDP It is now 25%. Projections that it would be 45% by 2020 have now been revised. It will be 40% by 2012 and by 2019 total National Debt to GDP wil be 83%. That's just Federal spending. Add in 15% for state and local spending and by 2019 total government spending will be 60% of GDP.

    G.W. Bush took the total Federal budget from $1.8 trillion to 3.5 trillion in 8 years. Btw, that is NOT the "official" OMB budget number. If you want to read some hilarious fiction, go to the OMB homepage with all its talk of "fiscal responsibility " and "declining deficits". Both under Bush and now Obama. Neither administration used honest budgetary numbers as REAL spending numbers are much higher than those listed because of "off budgeting" among other trickery. ( Kudos to Melonie for her usual superb job of exposing Federal budgetary, fiscal and related economic statistical chicanery. The Bushies were bad with this stuff but the Obamanations are raising it to an art form.)

    The two scariest things to keep in mind are that actual spending is historically UNDERestimated and revenues OVERestimated. Especially early on in any President's term. Just trying to help everyone sleep better at night. No need to thank me.
    Last edited by Eric Stoner; 09-14-2009 at 12:30 PM.

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    Default Re: Obama's Temporary Measures looking Permanent

    Socialism has been accomplished.

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    Default Re: Obama's Temporary Measures looking Permanent

    this latest tidbit is based on public statements just made by the (apparent) bosses at GM and Chrysler ...

    (snip)"based on a speech by Chrysler boss Sergio Marcchione at the Frankfurt Auto Show, even the "conservative" 9.5 million SAAR that we estimated for September, after the 14.1 million number in August, is going to be an optimistic number. The Fiat/Chrysler boss warned that "we are going to see harsh reality in September." According to Bloomberg:

    Chrysler Group LLC, the U.S. automaker run by Fiat SpA, said nationwide industry sales are off 19 percent so far this month after a government purchase- incentive program ended.

    Light-vehicle sales in the U.S. last September ran at a seasonally adjusted annualized rate of 12.5 million, which was the lowest since March 1993. A 19 percent decline would equate to a 10.1 million annual rate, higher than any of the first six months of 2009.


    Even GM's Fritz Henderson has thrown in the towel, saying that September will be a "very weak" month. And as for that 10.1 million SAAR, we are happy to take the under.

    We are not sure yet how the MSM will prepare the public for the collapse that is now expected in auto sales when they are reported in the first days of October. The bigger surprise is why the auto industry is not following in the footsteps of Senator Isakson and demanding not only yet another extension to Cash For Clunkers, but also an expansion. At this point there is no point in the government pretending it is not subsidizing any and all industry. As David Rosenberg and other economists have speculated, the government accounts for 80%, if not more, of all the "growth" experienced in the economy. The issue is that, as any first year analyst at an investment bank will attest, all such comparable stimuli are considered "non-recurring" unless of course, they become, "recurring." But at that point the economy is effectively one based on central planning"(snip)

    from

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