Director Blue on the newest group to want a free handout:
Progressive communications group FreePress is lobbying President-Elect Obama for a $44 billion bailout aimed primarily at the telephone and cable monopolies (PDF). The money would ostensibly be used for various incentives to build out broadband connections to underserved areas such as rural locations.
FreePress calls the $50 billion in taxpayer money a “down payment on a digital future.” But what it really appears to be is a duplicate set of payments to the telephone and cable companies for infrastructure they promised to build years ago.
Given the fact that the carriers are government-regulated, possess virtual monopolies over their territories, and spend hundreds of millions lobbying, I like to call them the Fannie Mae and Freddie Mac of communications.
Oh, thats not it by a longshot either. Real estate developers want some of the action:
With a record amount of commercial real-estate debt coming due, some of the country’s biggest property developers have become the latest to go hat-in-hand to the government for assistance.
They’re warning policymakers that thousands of office complexes, hotels, shopping centers and other commercial buildings are headed into defaults, foreclosures and bankruptcies. The reason: according to research firm Foresight Analytics LCC, $530 billion of commercial mortgages will be coming due for refinancing in the next three years — with about $160 billion maturing in the next year. Credit, meanwhile, is practically nonexistent and cash flows from commercial property are siphoning off.
Unlike home loans, which borrowers repay after a set period of time, commercial mortgages usually are underwritten for five, seven or 10 years with big payments due at the end. At that point, they typically need to be refinanced. A borrower’s inability to refinance could force it to give up the property to the lender.
A recent letter sent to Treasury Secretary Henry Paulson, and signed by a dozen real-estate trade groups, painted a bleak scenario: “Right now, we believe there is insufficient systemic capacity to refinance expiring, performing commercial real-estate loans,” said the letter. “For many borrowers, [credit] simply is not available,” the letter noted.
Hey, I have an idea. Since we’re mortgaging the future of our great grandkids why not pay everyone off and we all start at zero. Great idea right?
Socialism here we come.