The daily power grab is just breathtaking… As the gullible media and citizens whine about AIG and bonuses, the behind the scenes fallout of Obama’nomics is reaching unbelievable heights.
These include a proposed budget being short over a trillion A spending plan Obama appears unwilling to abandon.
Then there’s the first time that the UN and Euro nations have decided to officially recommend dumping the dollar as the world’s reserve currency…. a position they think is necessary with the spending and borrowed debt in the US future.
There’s the cap and trade bit, where Obama’s estimates of the costs to the gullible US voter is only a third of reality. The downpayment on healthcare reform is less than half of what it needs to be… and even that figure isn’t accurate.
Meanwhile Congress and Obama kick out laws like the Octomom kicks out babies…. each one a knee jerk reaction and an attempt to fix what they broke. For example the insidious 90% tax on bonuses for any recipient employed by a company that took over $5 bil in bail out monies. This, of course, includes the banks who didn’t want the cash, but were strong armed into it by the Obama admin economic thugs.
Not enough? There’s the Obama proposed “resolution authority” giving the Treasury Sec’y the power to seize other financial institutions if he/she thinks they are a threat to the US economy.
And to make sure he can shovel all this crap, and more, down the US taxpayer throats, he’s prepared to make vast use of the budget reconciliation process” that cuts out bipartisan input, and only requires 51 Senate votes to pass. This gives Obama a cushion of eight Democrat renegades, and still enjoy passage.
The O’faithful, determined to believe that Obama still governs “from the center”, don’t seem to be digesting all the events very quickly. So let’s pile on one more power grab… the latest and greatest chapter from the rapidly expanding Obama version of Mein Kopf comes from Steven Labaton at the New York Times today… Administration Seeks Increase in Oversight of Executive Pay.
Oh, but the O’faithful will say… if we are going to take over ownership… (but of course we’re told we aren’t “nationalizing” anything) … of institutions, we *should* control their pay. Afterall, any bank exec now has a cap of half mil if they took bailout cash.
But wait… this isn’t about bailed out companies. This is about any bank or financial institution. You might want to say that Obama supports not only minimal wages, but maximum wages. And the proposal can also be applied broadly to *all* publicly traded enterprises.
whoa…..
The outlines of the plan are expected to be unveiled this week in preparation for President Obama’s first foreign summit meeting in early April.
Officials said the proposal would seek a broad new role for the Federal Reserve to oversee large companies, including major hedge funds, whose problems could pose risks to the entire financial system.
~~~One proposal could impose greater requirements on company boards to tie executive compensation more closely to corporate performance and to take other steps to ensure that compensation was aligned with the financial interest of the company.
The new rules will cover all financial institutions, including those not now covered by any pay rules because they are not receiving federal bailout money. Officials say the rules could also be applied more broadly to publicly traded companies, which already report about some executive pay practices to the Securities and Exchange Commission.
Think this can be stopped in Congress? Think again… in fact, think back to CRA regulations rewritten by Clinton Treasury Sec’y Robert Rubin – aka master of the Citigroup demise. All was accomplished behind closed doors, in the midnight hours of the last days of Democrat majority in Congress. It was done specifically thru “regulations” in order to eliminate any opportunity for the incoming Republican majority to kill it via legislation.
Obama will be seizing this authority by regulation changes, *not* legislation. Congress? Why does a fuehrer need Congress when he has a Treasury Secretary czar?
A central aspect of the plan, which has already been announced by the administration, would give the government greater authority to take over and resolve problems at large troubled companies not now regulated by Washington, like insurance companies and hedge funds.
That proposal would, for instance, make it easier for the government to cancel bonus contracts like those given to executives at the American International Group, which have stoked a political furor. Under the proposal, the Treasury secretary would have the authority to seize and wind down a struggling institution after consulting with the president and upon the recommendation of two-thirds of the Federal Reserve board.
~~~Representative Barney Frank, the Massachusetts Democrat who heads the Financial Services Committee, said he believed giving the government new authority to take over troubled companies could be adopted by the House relatively quickly, particularly after the furor over the A.I.G. bonuses.
“This would give the government the same powers that you would get as if the company were in bankruptcy,” Mr. Frank said in an interview shortly after meeting with Mr. Geithner on the plan.
We already have a bankruptcy system… not good enough? Hang no. That is dependent upon the company making it’s financial decisions. This creates a separate system that has the government deciding FOR the company to declare bankruptcy … then stepping in as the trustees with the resolution authority.
If this continues unchecked, we may not be able to recognize America in the span of but a few years.
Vietnam era Navy wife, indy/conservative, and an official California escapee now residing as a red speck in the sea of Oregon blue.
This power grab is insane. They are going to keep taking, because no one can stop them at this point. The only chance the nation has is a GOP victory in 2010 or a long string of lawsuits questioning the legality and constitutionality of this abomination. We need to keep bringing this type of stuff to light so everyone knows.
http://franklinslocke.blogspot.com/
We get a reprieve, of sorts, on cap-and-trade. Nonetheless, let’s stay vigilant and active!
This is from George Stephanopolous’ “Bottom Line” blog at
http://blogs.abcnews.com/george/2009/03/scorpions-in-a.html
Dems Make Choice: Health Care Over Carbon Caps
March 20, 2009 11:20 AM
“When the White House released its budget, I said the president’s effort to reform health care and cap carbon emissions were ‘scorpions in a bottle’ — only one could make it through Congress this year.
This week, the White House and House Democrats made their choice: health care is the survivor.”
Ed Morrisey contemplates George’s comments at hotair.com:
http://hotair.com/archives/2009/03/21/cap-and-trade-traded-away/
Jeff V
Cap and trade is not gone, ruaqtpi2. It has temporarily been relocated and disguised. Mark my words… it will reappear.
Resident and/or transient Obamanauts dashing in to tell us this isn’t Socialism or Marxism in 3,2,1…..
Quite frankly I’m sort of hoping that the guy who wanted us to believe that Adam Smith believed in progressive income taxes will stop in and try to spin and parse an explanation for this.
Anyone seen Larry W?
Directive 10-289
It is in Chapter Six.
Godd job Mata, I’m gonna go kill myself now…..
I will be watching the Market closely tomorrow.
Not only do we have the things that Mata laid out above to be concerned about, Turbo Tax Timmy will be rolling out his Super-Duper Bank Rescue Operation tomorrow as well.
Breaking news for you, Aye… Paul Krugman at the NYTs says Geithner’s big plan has been leaked… and it’s virtually the same as it was before. The title of his little ditty? You’re gonna love this from a liberal… “Despair over financial policy”.
I’m glad that Obama is president for the following reason. The constitutionally ignorant people, including federal and state government leaders, will be forced to reconnect with the Constitution and its history in order to protect themselves from Socialist Obama’s misguided pen.
The bottom line is that constitutionally clueless Constitution “expert” Obama is exercising non-existent federal government powers with respect to trying to control financial institutions. This is evidenced by the fact that Thomas Jefferson, arguing against the establishment of a national bank, had noted that the Founding States had rejected the idea of a national bank at the first constitutional convention. See for yourselves.
“It is known that the very power now proposed as a means was rejected as an end by the Convention which formed the Constitution. A proposition was made to them to authorize Congress to open canals, and an amendatory one to empower them to incorporate. But the whole was rejected, and one of the reasons for rejection urged in debate was, that then they would have a power to erect a bank, which would render the great cities, where there were prejudices and jealousies on the subject, adverse to the reception of the Constitution.” –Jefferson’s Opinion on the Constitutionality of a National Bank : 1791 http://avalon.law.yale.edu/18th_century/bank-tj.asp
Again, the reason that the Constitution doesn’t expressly delegate power to the federal government to regulate banking as required for all federal government powers is that the Founders had rejected the idea. And since the states have never amended the Constitution to expressly authorize the feds to regulate banking, the 10th A. automatically reserves government power to regulate banking to the states, not the federal government. And that reflects what Jefferson wrote above.
Also, regardless that the Founders had reserved the lion’s share of government power to serve the people to the states, not the Oval Office and Congress, the reason that people now evidently regard the Oval Office as a throne room is the following, in my opinion. The Constitution-ignoring MSM long ago seized the opportunity provided by widespread constitutional ignorance to turn the Oval Office into a throne room, wrongly making the president a king in many people’s eyes. The MSM has been doing so since the days that Constitution flunky FDR and the likewise ignorant Democratic Congress started usurping state powers to establish constitutionally unauthorized New Deal programs, Social Security for example.
Sadly, the best that the constitutionally ignorant people do when the feds exercise non-existent federal powers these days is to “complain” about it as if complaining was actually their idea of the pursuit of happiness.
But noooooo, Buffoon. We’re already short handed on those that are enlightened…. Can’t afford to lose you. Sorry. You’ll just have to stick around with the rest of us.
Aye… ever the optimist, eh? Do you really think Turbo Tax Timmy (love that, BTW) will have anything of substance to say? Especially on the heels of the G20 telling him and Obama that they have no intention of following their spending spree with their own “stimulus” plans.
BTW, ruaqtipi2… forgot to mention INRE the cap and trade bit that should give you a heads up it’s not gone, but temporarily masked…
As the article points out, it’s just for “this year” they picked their poison.
But the big thing is Obama was counting on the big bucks revenue from the cap and trade in his budget.
Let’s see ’em reconcile the numbers now…. Considering the trillions over 10 years morphs up every few days, it’s unlikely we can believe the numbers out of the gate. Hang… ever!
Funny how the NYTimes is trashing their messiah.
I love it.
O’Dumbo is watching Chavez and running about 30 days behind him. Democrats will find out what they have done when it’s too late, like now.
I would say it’s not legal and it will be stopped DOA by the first lawsuit (what happens when the government gives a company notice that they’re “taking over” and the company files for bankruptcy protection, just one of many, many examples) but I fear nothing is certain any longer, even the sanctity of the judicial system (whatever you might think of it — nonetheless a resort of last resort). Can the administration issue a “regulation” that allows it to disregard a court ruling if the judge doesn’t agree with the government?
If this were a movie script, nobody would buy it — too preposterous.
Could we, just maybe, get this nation to wake the f*** up before it’s no longer a nation?
“Then there’s the first time that the UN and Euro nations have decided to officially recommend dumping the dollar as the world’s reserve currency….”
OK…I’m tracking this notion and I’m wondering if the UN and Euro nations have given up on us then can we PLEASE stop giving them our DOLLARS?! Really. If suffering Obama for four years is our course, why not get something out of it?!
Euro-weenies and UN Kleptocrats…bite me!
Mata,
I said a reprieve *of sorts*. Of course I read the articles I referenced, but I didn’t t ink I had to spell everything out (certainly not for you.) Maybe I am too cryptic for some, as Dave Noble said in a different thread.
So what’s the reality? Obama and his top advisers realized that they couldn’t pull off two ridiculously expensive “projects” (butt-f_cks) at the same time, so they chose to push through massive health care reform now, and put Cap-And-Trade (CAT) back into their bag of tricks for later action. After they’ve convinced themselves that they have their health plan in place, the dems will stir up another crisis so that they can let the CAT out of the bag (aww, look at the kitty.)
I’m really beginning to wonder if this country can survive another 22 months with Democrats in control of congress, much less 46 months of Obama on the throne. Does anyone else think that we might just need a sensible fiscal conservative to stage a military coup? Is the CIA going to throw me in prison for asking the question?
Jeff V
P.S. Mata, I promise to TRY to be a bit less cryptic, if you need me to do so. ;^)
Krugman is a Nobel prize winning economist. He may be a liberal in terms of believing that an elite should make important decisions, but that doesn’t mean he’s going to let a tool like Geithner tell him that 2+2=17.
The ability to take over failing institutions by fiat seems to already exist; isn’t this basically what happened to WaMu, via the forced sale to JP Morgan? Maybe they are trying to formalize the authority so that they don’t get sued next time. Or is it just that they want authority to take over institutions that aren’t banks? This doesn’t seem particularly more unreasonable than the powers already granted to the FDIC, though obviously defining the class of targets so broadly should make people nervous. Ultimately you can bet that exercising this power is going to end up with a Supreme Court case that revolves around the takings clause.
Ummmm bart, krugman has shown himself to be a hardcore obama
kool-aid drinker.
Folks, the NYT and others are not attacking the messiah. They are
trying to protect him by making Geithner the scapegoat. Krugman is
doing the same.
ruaqtpi2, you just be yourself. I expect you to call me out when I’m off base, and I’ll do the same with you. Please don’t alter your bad self in any way… LOL
But INRE cap and trade… not so simple since Obama’s projected budget relies heavily on revenue he counted from the emissions and increased taxes. As the WSJ points out today:
This means for these figures to work, he *must* implement the cap and trade program within the next year or two for the needed revenue. Mind you, this doesn’t even include his health care agenda…. also off by 50% in projected costs.
bbartlog, INRE your comment “…doesn’t seem particularly more unreasonable than the powers already granted to the FDIC” Indeed Obama patterned his resolution authority on the FDIC powers in the attempt to pick up the rest of the financial institutions. This broad sweep of intervention, deciding who gets liquidated and when, combined with placing wage caps on all publicly traded companies is nothing short of …. dang, it’s so mind blowing a power grab I can’t think of an adjective that is worthy of my shock and anger. Plus, to implement this power by regulations, dodging Congressional debate and review, is reminiscent of despotic regimes.
There is no sugar coating this move. You may believe it’s reasonable, and that – in itself – is frightening. There is nothing reasonable about it. If you can nod your head in acquiescence to this, coaxing you into even more nanny regulations and control over the private sector will be a piece of cake. Little by little the grab becomes acceptable to the public until you look around, and all you knew about this country is history.
Which brings me to Hard Right’s astute observation…. that Turbo Tax Timmy (H/T to Aye) will be Obama’s scape goat. Yes, in one way, but overall I’m going to disagree. Krugman make it quite plain in his article that this was a mind meld between Obama and Geithner. Obama, himself, has admitted on Leno that he’s virtually placed all decisions and plans of action in the hands of Geithner… needing only his final nod of approval. Since he hasn’t got a clue, he’ll defer to Geithner because, as he says, he has “full faith” in his pick for the Treasury god.
Obama will not be able to escape the backlash of Geithner’s master plan. He was his pick for the job, and he stands by him even now…. amid some calls for Geithner’s head.
To boot, he’s placing even more power in that position’s hands with his regulations change for control wages and seize all financial institutions and publicly traded companies. I’m tell ya, it may be time to elect Treasury Secy’s and have the POTUS an appointed position. He who controls the money and business truly wields more power.
Mata, you and I know the messiah will be to blame. However, the media will do everything it can
to spin into being ONLY Geithner’s fault. I too think that trick won’t fly. There WILL be blowback onto obama’s blue dress.
Only one thing I will quibble with, it was Pres Bush’s treas sec Paulson who strong armed the financial services sector to accept the bailouts, Pres Obama was a latecomer to that party.
Would pres Obama have done the strongarming had he been Pres last year? Probably, but still, credit where credit is due.
I can’t disagree, eaglewingz. I was livid at the Bush/Paulson/Bernanke doing this originally. However the Obama admin has compounded the Bush economic errors trifold. He inherited a problem, yes. But Obama has blown it up even more with the massive spending, jeopardizing the dollar and our status as the reserve currency of the world.
Rough times for Aye and all the other cheerleaders of collapse in the GOP today.
Fit fit, you’re so juvenile.
Have you ever heard of a fool’s rally?
Yeah, I guess you were waiting on the market to drop… oh, wait, the market went way up instead + 497 points up.
Personally I’m happy for any market rally. Do I consider this a permanent rally? Not yet.
But there was no way for them not to be happy with the Public Private Investment plan. Afterall, the government is taking the toxic assets off their hands. Why wouldn’t they be happy? But considering the TARP money is already drained, this is another $500 bil expense, on up to another trillion. Moody’s says it’s still about $400 bil short.
oh joy…. I’m thrilled to be a partner in overpriced promissory notes…
I don’t think it is a fools rally–I think it is people covering their shorts.
Let’s talk Thursday.
Like let’s talk global warming and cooling when we have enough data points to see if we turn the corner ten years agao. And know what Rdoubt will do for us.
And in this context, it should, I believ, be spelled “Ai, Chihuahua”
In a strange way, I actually admire the stance that the GOP (and supporters, such as Aye) are taking.
I can’t remember when the political stakes were higher. Usually politicians fudge and hedge their bets. This was certainly the case for the spineless Dems of the winter of 2003, who voiced misgivings, but who ultimately backed the Iraq invasion. This reminded me, at the time, of the Gulf of Tonkin resolution, where Wayne Morse and another Senator were the only ones who were willing to stick out their necks and vote against it.
Contrast this to the present situation:
On one hand, you’ve got President Barack Obama, taking bold actions and taking ownership of the economy. He’s gone on record as saying that, if he’s not successful, he’ll only be a one term President. His legacy shall have been a disaster for all minorities who aspire to the highest levels of government and business. But he’s on record as predicting success.
On the other hand, you’ve got the GOP, who are almost unanimous in opposing him — publicly — on record — no waffling.
If Obama succeeds, in the face of such withering opposition, the GOP will be truly dead for a generation. If Obama fails, the GOP will have a new lease on life.
I do admire political courage. I think that both Obama and the GOP body politic are currently showing political courage in spades.
Right now, we argue how it’s going to turn out. But it will turn out — one way or the other — and the way it turns out will profoundly affect the political landscape for the rest of my life.
– Larry Weisenthal/Huntington Beach, CA
Certainly it will “turn out” one way or another, Larry. But you could not be more correct in how it will profoundly affect not only the political landscape, but the American lifestyle for the future.
Obama may succeed in turning the US into a Euro-socialist nation, as is his desire. He may also accomplish the dubious honor of being the final straw that kills the dollar as the world’s reserve currency. When oil starts trading predominately in dollars and turns to a mixture of currencies instead… well, as one Saudi businessman told a friend of mine, that will be the start of turning the US into a third world country. We make nothing. We have no oil or valuable minerals to sell. Our appeal has turned on the success of the entrepreneurial spirit. Destroy that and the income/revenue, and we are left with nothing to offer.
Obama has not blown it it even more Mata. I tend to not agree with much of his approach (and the completely tone deaf manner in which the administration has operated), but honestly, the world economic conditions are the worst since WWII. The economy “blown up” took place beginning in 2007 and the pieces have not even fallen back to earth yet. Pres Obama’s program might not be the right fix long term, but he is either filling the holes with marshmallow fluff or firmer stuff… time will tell.
So you prefer to remain oblivious to the repercussions of the over spending, blast? Obama took a six foot deep hole, and bought 25 truckloads of fill on the nation’s dime to fill it up.
Yes time will tell. Unfortunately, instead of heading off the problem at the pass, you want to give it the time and will only start complaining when the dollar’s worth nothing, has been demoted in the world, and inflation or hyperinflation is upon us.
By then, it will be too late, and recovery will be either arduous… or impossible. You ask a hefty price in order to conduct a Euro-socialist experiment.
Hey Larry, now that you’ve shown up again perhaps you can answer the query that I made in post #3.
Maybe if this were the fact all along we would have done something about our energy independence years ago. We have been shipping our dollars off to the middle east and other enemies for what??? That “entrepreneurial spirit” you speak of should have been put at work a long time ago to solve our energy problems. Was it a surprise that our economy has fallen a part when we don’t make anything and we import most of our energy??? We have been gluttons stuffing our faces with no thought of tomorrow. Now tomorrow has come.
blast, what the hell fire are you babbling about, guy? It was not energy or health care that created this crisis. Nor can implementing it cure it.
But it just may be energy and health care that topples the dollar out of it’s coveted position. Do you have any idea what that means to this nation?
[Deleted by author]
With regard to weakening of the dollar as far as being the world’s reserve currency, this is no more predominately Obamas’s fault than is the Dow Jones falling from 14,000 to 7,000 being predominately Obama’s fault.
Take a look at this graphic, showing rise of the euro vis a vis the dollar. When precisely did this rise occur?
http://optionstradingtutorials.com/wp-content/uploads/2008/01/euro-vs-usd-weekly.png
The problem has been one of increasing debt to GDP ratio. The Presidents most responsible for a worsening of debt/GDP were Reagan and Bush. True enough, Obama is going to be increasing borrowing, but the determining factor will not be the amount of money he borrows but the amount that the economy grows (or fails to grow). If debt to GDP goes way up, and stays up, then this will definitely threaten the dollar’s role in the world economy. If the economy recovers and the the GDP grows in such a way that economists see the US working its way to reduce the debt/GDP ratio, then the dollar will remain attractive.
I just got back from a trip to Germany. The dollar has recently risen against the euro and we got some good meals and good gifts for very good prices.
The dollar may be weakening, but the question is whether or not betting against the dollar is a good bet, long-term. If Obama’s “investments” pay dividends in strengthening the economy, long term, the the question is whether it is more prudent to invest in the USA or to invest in a global “marketbasket.”
As I said, one way or the other, we’ll find out. But I don’t think that the answer is nearly as pre-ordained as Mata and others here seem to think it is.
– Larry Weisenthal/Huntington Beach, CA
Larry, now that you’re back from Germany, you’d better play catch up on this subject.
If you read the post and supporting news articles, you will see the reason the dollar is now on death watch is the impending massive debt proposed by Obama as “the cure”.
Has it been replaced by a basket of currencies yet? No. Has a world body ever put forth the recommendation that it does get replaced, backed by Russian and other nations? Nope… new event.
China, our largest financial partner, has already sent a shot over our bow on Obama’s spending as well.
So read and catch up before making too many uninformed predictions, please. This is news in the past week that you most likely missed.
BTW, those 25 truckloads of fill have left an even bigger hole than the 6 ft one.
If the dems go after universal healthcare and the cap and trade it’s a definite that our
economy will be in the toilet.
Ummmm blast, there are no economical alternatives to oil. If there had been, we’d be using it!
Not to mention everytime we tried NOT to rely on foreign countries for our supply of oil,
DEMOCRATS kept us from doing so and continue to do so. So take your self righteous bleatings and shove it.
Honestly, that is hyperbole at its worst. I have been a deficit hawk always. Trade AND budget deficits. Both of those issues directly affect the reserve currency status. If we were not in the midst of a free fall of the economy, I would probably be taking a hard line on what is going on. I think we missed our opportunity by cutting taxes and allowing the deficit to balloon during the last administration (not paying for what we consumed). Our position on being the reserve currency fell from 70% in 2000 to 63% in 2007 and I am sure once 2008 is tallied, it will be lower. Back in 2007 Greenspan even spoke about the dollar being displaced if we continued deficit spending and having imbalanced trade. Keep in mind that some 300-400 Billion dollars go out the door for foreign oil, add to that the trinkets we buy from China, it all has put us in a crapper.
So lets let GM and the auto industry collapse, lets allow our financial sector to collapse, lets just not run any deficits… not possible. Government (all of us) has a role in this emergency… this is not some dip in the economy. Once we have stabilized things, housing, job growth etc, we need to pay for this… yep, taxes where necessary and cuts in spending. We as a country need to look at the USA as a big business competing against other countries and find ways to support American economic interests FIRST! The ATM is empty right now Mata, and if the government does not turn on the presses, it would be worse. With that said… we will have to pay for it when things improve.
Apparently that’s a past tense trait you used to possess. Now you’re content to trade capitalist America for Euro-socialist America. How you figure you’ll reconcile your “deficit hawk” status to that in the face of reality ought to be a hoot.
Sad thing is, by the time you figure out the debt to “remake” America, plus the cost to maintain that new Euro-America, is so high – and far more oppressive than what you’ve grown up in so far – it will be nigh on impossible to reverse the repercussions.
BTW, no one has ever suggested “more of the same” INRE alternative energy. It was an “all of the above”.
And do try to get a grip on reality about the Pickens Plan please. Even if it weren’t thwarted by the sundry enviro lawsuits against wind mills and panels in environmentally sensitive areas, or running transmission lines thru pristine parks and land, it still will not live up to all the proposed expectations. Would be a good addition, yes. But a very expensive, long term and unstable proposition as a replacement source for oil.
There is no replacement for the stability of oil. One can supplement to use alternatives sources when available. But when the wind doesn’t blow, rain doesn’t fall and the sun doesn’t shine, oil and gas are the only stable sources of energy.
Mata, I’ve been following the “dollar as reserve currency” situation for years. The problem is precisely as I stated it to be: the US is taking on too much debt, relative to its economy. This is what the Chinese are complaining about. It’s not a new problem and the fault is currently not Obama’s fault. Bush weakened the dollar tremendously, by raising debt to GDP through outrageous and irresponsible tax cuts at a time of vastly increased spending. The dollar would be just as much under threat had the GOP won the election and if we were now proceeding with yet another round of irresponsible tax cuts as the “cure” for the economy.
What the world is saying is that it doesn’t like having the dollar as its reserve currency because it is the currency of a nation which is racking up too much debt. But it’s not debt in a vacuum. It’s debt to GDP which is the determining factor. If I borrow ten thousand dollars, but have a yearly income of $100,000, this is not a big problem. If I borrow ten thousand dollars, but have a yearly income of $20,000, it’s a big problem.
So what will determine the fate of the dollar, reserve currency-wise, is what happens to our debt as a ratio of our economy and what is the projection for the future and how does this compare with projections for the world currencies and economies, as a whole.
P.S. Contrary to certain impressions, both Internet and mainstream news media are readily available beyond the borders of the USA.
– Larry Weisenthal/Huntington Beach, CA
Larry, obviously you decided not to read the post, nor check out the links… but decided to depend upon your past observations instead. If you had, you would find that the Obama proposed spending is *precisely* the trigger for the UN recommendation. The chit chat about the reserve currency status has remained, heretofore, chit chat. We’ve now left the chit chat realm, and entered into the very real, and possibly imminent, recommendation stage.
But of course it’s about taking on too much debt. duh wuh That’s the point. But compared to Obama, the Bush admin is Ebenezer Scrooge. So don’t be blaming this on the Bush admin. This one’s on your guy’s shoulders alone. He’s chosen the path to spend everything quick, all at once, and on every Euro-socialist/Democrat dream for the past three decades instead of wise, cautious spending… and a wait for results.
Apparently the world’s other G20 governments have already told Geithner “no way, Jose” to following him and Obama into the stimulus spending world. They demonstrate no faith in the proposed spending as stabilizing the US economy, nor returning it to it’s lofty status. That’s why it’s left the “chit chat” stage. Not because of Bush. Because of Obama.
BTW, your assumption that we would be in the same boat with a President McCain is like gazing into a crystal ball and discovering that the price tag of his budgets and agenda would be as large as Obama’s. But then, you are talking to someone who didn’t want a POTUS McCain either. I truly was a political waif this year… more ostracized than ever.
So I shan’t be defending what McCain would or would not be spending, nor wagering guesses as to his handling of the economic crisis. It’s a moot point.
Nor do I think you should leave your cancer research speciality and start a career as a seer.
Dude, if we stick our head in the sand any longer we will be totally bankrupt. There are alternatives to oil, take one, Pickens Plan, using wind energy and natural gas, at least that could bridge us to newer technologies that must be invested in. And then keep in mind we don’t have an infinite amount of fossil fuels, and if the Iranians (or AQ) ever sunk a tanker in the Strait of Hormuz we would be out of fuel fast. Our national security is in jeopardy as well as our future economic freedom. How the hell are we going to be a great nation in 50-100 years if all we do is more of the same.
As to Democrats keeping us from oil in Anwar or off the coasts etc, who cares… it does not even dent our present needs, and does all of those resources only belong to this generation of gluttons? What about future Americans? Aren’t we going to leave a single drop in the ground for them? No? Lets just burn all of the shit now… it is ours huh? That is the type of thinking of leaving deficits for years and allowing trade imbalances etc. That is why the Oak Tree is hollowed out.
There are massive reserves of oil off our coastlines, in the Gulf, as well as in Alaska.
There are inland sources available as well.
Tapping into those sources would go a long way into making us energy independent for many, many years.
Getting people to stop being roadblocks to every proven alternative would go a long way as well.
As Mata says, there is no economic alternative. None.
Those who fool themselves into thinking that solar, wind, and natural gas will ever completely replace oil are just that, fools.
It’s amazing to see the two most vehement opponents of debt spin and twist for the fellow who will be raising our national debt to 80% of GDP.
I’ve read about human pretzels in the circus freak shows of days gone by, but never dreamed that I would actually get to see them in real life.
Aye. I’ve explained, again and again, that I wouldn’t have done it Obama’s way. But I do understand Obama’s way. I’m not “defending” it, but I am explaining it. And I do feel that it has a logic to it.
We got out of the depression by fighting WWII. It took raising debt to GDP to above 0.9 to do it. But we gradually paid this down to 0.32 by the time Reagan took office. Reagan perceived that he had serious problems with which to deal: he increased debt to GDP to 0.66 (doubling it). Maybe it was worth it, if you think that ending a recession and “winning the cold war” were a result of massive tax cuts amid massive military build up. Clinton cut the debt to GDP by raising taxes and growing the economy. With Bush, the ratio went up to close to 0.7, because Bush felt that he needed to cut taxes and expand Medicare and fight two wars, all at the same time.
So now, we are having what is unanimously considered to be the greatest financial crisis since the depression. We are faced with a broken health care system. We have had no energy policy, so that we need to jump start the transition to non-carbon based energy to deal with the end of cheap fossil fuel energy; we have a disgraceful public education system; we have crumbling infrastructure. Add it all up, and you can make a very good case for temporarily raising debt to GDP up to the levels currently projected, with plans in place to bring this back down (as we did after WWII and as we did again after Reagan), once these challenges have been met.
But I think that it’s great that Mata and Aye and all the other FA regulars, along with most of the GOP are coming right out in opposition to it all and forecasting abject failure. Before the Iraq War invasion, I publicly predicted that no WMD would be found. You guys are coming right out and predicting failure. Clear and bold. Obama is predicting success. Clear and bold. No mushy equivocating.
There will be one clear winner and there will be one clear loser.
And we’ll all get to see who is who.
– Larry Weisenthal/Huntington Beach, CA
Not to dash so far OT, but talk about apples to onions… Just who on this site predicted we would “find” WMD stashes when we all know Saddam had moving convoys traversing the borders for the months prior to our 2003 entry, Larry W? Or perhaps you think he was smuggling out the palace patio furniture? Maybe you should ask Georges Sada about those WMDs.
Then again, my guess is you don’t consider chemical stashes loaded atop the proscribed Scud missiles Saddam obtained and possessed post 1998 – then abandoned in a Netherlands junkyard prior to the US coalition entry – a WMD.
Another “it all depends on what the meaning of “is”… is” moment.
And as I said on another thread, Obama’s “win” to “remake” America into a Euro-socialist structure is a loss for the nation. There’s your winners and losers. It’s not political parties. It’s us… Joe and Josephine Blow.
Mata (#48):
On at least four separate occasions, including in his final “exit interview” President George W Bush told the nation that there were no WMD. He told the nation that the misperception that Iraq had WMD was the result of “bad intelligence.” Not once did he say, hint, or imply that Iraq really had WMD afterall, nor did he say they had been secretly smuggled out for “safe keeping” before the invasion. It is crazy to think that Syria would even accept such (imaginary) weapons, seeing what the USA was fixing on doing to Iraq.
We didn’t invade Iraq to find old chemical weapons which Reagan and Rumsfeld helped Saddam to acquire. We invaded Iraq to find biological weapons laboratories and nuclear weapons programs. We didn’t find them — because they didn’t exist. You consider odd lots of old, decaying chemical weapons left over from the Iran/Iraq War to be WMD. George W Bush did not. If you want to argue the meaning of “is,” I suggest you argue it with our newly-retired, ex-Commander-in-Chief.
I believe the then-President of the USA on this issue. I don’t believe internet conspiracy theorists and an old Iraqi general getting fat on the Right Wing True Believer lecture circuit.
Follow-up comment on the dollar as reserve currency issue. The announced Obama plan is NOT the reason for considering abandoning the dollar as reserve currency. The reaction to the Obama plan is just a “this may be the straw which breaks the camel’s back” warning. The Chinese are nervous that the US has borrowed way too much money. They are warning Obama that he’d better succeed, or there could be consequences — fair enough; he’d better succeed; I’m in agreement with that.
– Larry Weisenthal/Huntington Beach, CA
What part of “moved out of the country prior to our entry” did you not get, Larry?
I’m sorry, Larry… tell me again who’s borrowing all this money to pay for Obama’s plan? Especially in the wake of Hillary’s recent visit, begging for China loans?
Georges Sada… one of Obama’s top AF commanders.. is a “conspiracist”???? And “got fat”??
Obviously, Larry, you don’t own, nor read his book. He didn’t even want to write the dang thing. But let’s just throw out the inside voice because it doesn’t fit with what you want to believe… despite the obvious traffic on record prior to our military entry.
duh
And then there is the Cuban Healthcare plan …
Obammunism … it sucks before and it sucks after.
Does anyone wonder how the federal government acquires these powers to do as they please.
Remember, the goal of the Marxists is a classless money less society, with of course a ruler who lives in royalty.
WMD!
When you got Obama, what else do you need?
Reading all this he said no he said no he said crap is like listening to my uncles explain that the South had not really lost the War Between The States and they were holding on to their Confederate money and ….
Which all so yesterday.
We have a current crisis on our hands (in the sense that somebody with an untreatable and terminal cancer “haqs a crisis on their hands”).
I’m out,
Might I also suggest Larry W read the book by Mahdi Obeidi as well as the massive archives assembled on this very site by Scott and others.
After you’ve read all that perhaps you will cease beclowning yourself by trying to convince the rest of us regarding your alternate reality.
Are you saying we can drill enough of our own oil resources to be energy independent?? How many years are you speaking of???
With all due respect, do you think we have an infinite source? We have to look to the future and make solutions, and yeah, all of the above works for me, but if the #1 resource you feel is “stable” coming from the middle east and Venezuela??? Some believe we have used 1/2 of all of the oil deposits, lets even say they are wrong, and we have only used 1/4 or 1/3 of them, we are using these “stable” resources at an unsustainable rate. So do we have the right to use all the oil today and not leave any for the future… and run up the trade deficit shipping our dollars for oil? We need a new widget and one that does not rely on “stable” oil.
With all due respect, blast… just how much do you know about peak oil??
President George W Bush had every motivation in the world to tell the American people and tell the world that Saddam Hussein did, indeed, have WMD. Among other things, the rest of the world — including the Iraqis themselves — felt that the USA was really fighting a war to control the world’s oil spigot. This greatly eroded the support for the war effort, which directly harmed the safety of our troops.
Whatever massive archives have been assembled here and whatever books have been written by people motivated to write such books and give such lectures — none of it was enough to convince the Commander in Chief who, on four different occasions, said that his administration had been misled into believing that Saddam had WMD on account of — the President’s own words — “bad intelligence.”
Sorry — no disrespect to Scott, but I do believe the President and Commander in Chief on this issue, and not his loyal band of internet apologists. And it’s absolutely nuts/crazy to believe that the Syrians would go along with this. They saw what was going to happen to Iraq. They knew that they’d be next, were they to be the guardians of the (ultimately imaginary) WMD. The whole thing is conspiracy theory nuts, aided and abetted by people with every motivation to exaggerate, embellish, and lie. I’m not talking about bloggers here; I’m rather referring to the so-called inside Iraqi sources.
The day that George W Bush tells the world that Saddam really did have WMD after all is the day I’ll seriously consider this to be even a remote possibility. But, even in his exit interview, the outgoing President affirmed that the fanciful WMD were an illusion created by bad intelligence.
I share my “alternate reality” with the 43rd President of the United States. You guys share your alternate reality with much less credible sources.
– Larry Weisenthal/Huntington Beach, CA
Blast:
Oil comes form the Earths Magma and there’s plenty of it. What were experiencing is artificial barriers placed by government to prevent a secure flow of oil.
About Alternative energies. I construct and install hydrogen generators on autos to improve mileage. it’s a good supplement but NOT a replacement to oil. Maybe I can make my Suburban run on straight hydrogen but the government won’t like that because they miss out collecting their tax money from gas because I’ll be using less of it.
Wind energy when at it’s peak, works about 40% percent of the time and takes up massive amounts of acreage verses a single coal plant uses 15 acres. On top of that, ice builds up on the blades and flings off becoming a deadly projectile and dices up birds who fly into them.
Ethanol was a loser from the beginning. If it weren’t for farmings wanting to secure their crop(which I understand because it’s tuff) Politicians wouldn’t subsidize a failure of an alternative fuel that cost 50% more to make then gasoline.
Hybrid technology requires batteries that use nickle mined in Canada and has cost mores more to manufacture then a regular gas vehicle. The nonce the battery wears down and can’t keep a charge you will fork out $10,000 for a new one.
These are some examples exposing the downside to the above utopia dream of alternative energies proposed and being forced into society before the free market perfects them. If one or all should be a viable solution then the free market will welcome them in to ur main stream via our wallets.
When mandated by government then the solution is a failure before production begins.
Mata,
I don’t believe that cap-and-trade is really pushed that far back, either, precisely because the administration has no other way (other than funny money) to pay for the dem’s wish list (porkulus).
The whole thing is pathetic, and it kills me to see that otherwise intelligent people (like Larry W; I’m not so sure about blast!) have yet to see through Obama. He’s just like his campaign symbol: emplty inside.
So, I’ll keep being my “bad self”, as long as YOU don’t change!
Jeff V
I see you are using buzz words “peak oil”, I spoke about some say we have used 1/2 the resource and I even allowed for lesser amounts. I know one thing for sure the amount of oil we have is finite, that means it will run out or become impossible to extract from the ground. Also, when we speak of these supplies… we must be thinking about our economic security since much of the world’s oil resources are in places that are unstable and unfriendly. So coupling those two arguments is enough for me to know long term oil is not a solution. And also, I did not make any environmental arguments many make… it is dollars and long term security I am speaking of.
Sorry, I don’t buy the abiogenic theory formation of oil, and neither do the majority of geologists. Oil was formed from organic matter.
First, the oil business is not a free market enterprise as evidenced in how prices escalated and the fact that the cost of securing the supply routes (and the national security implications) are not factored in. That whole concern about the dollar being at risk for no longer being the international trade denominated is centered on oil. We have played the shell game long enough with tyrants and unfriendly nations all in order to secure more oil… that we need and are addicted to. That addiction must be broken. Even President Bush said we are addicted to foreign oil… and we are not going to get new supplies from the “Earths Magma” anytime soon.
Hard Right said:
“They are trying to protect him by making Geithner the scapegoat.”
Which dovetails with. . .
On Greta or Hannity tonight (can’t remember which), Dick Morris said that he believes that Obama does not want his TARP/TALF plans to work so that he will have the excuse he needs to fully takeover the banking system.
This is also supported by the Dems continued persecution of all things capitalist.
They expressly do not want private sector support so that he will have the impetus to avert the next so-called crisis by assuming the reigns of these financial institutions.
They are already talking about dictating executive pay for more than just bailed-out businesses.
What a bunch of mouth-breathing fascists.
Blast:
Doesn’t matter if “majority” of geologist think. This isn’t a pie eating contest or a consensus of the “flavor of the month” science. Most, if all buffalo run off the cliff. But answer this, how do prehistoric animals and vegetation just somehow pile themselves together and form a pool of oil?
The US has more then enough oil supply to sustain ourselves for at least hundreds of years. We don’t tap it because of artificial barriers placed by government and environmentalist in the form of regulation, they are the culprits.
“buzz words”??? blast, really now. The term peak oil is what you base your condensed, and erroneous conclusions of “running out” of oil. Peak oil – also referred to as Hubbert Peak Theory… is the curve used when people want to talk about when the world will no longer have oil.
What you think is a political “buzz word” is actually the method they are using to try and gauge the world’s oil supply. This is why I asked you, exactly what do you know about peak oil? The method of measurement, it’s flaws, what it includes and what it doesn’t include?
This isn’t based on the actual supply of oil the earth has to offer. It’s based on the existing individual wells and their outputs. Wells generally increase in output in the earlier period, then start declining. Altho there is even some dispute about that since individual countries have to report their estimates… and many make it seem to be declining to keep it’s value up higher in price.
This does not mean that the world is running out of oil: it means that we are running out of the cheap pumpable oil with the *existing* fields. This is based on “Proven reserves” and not EUR (Estimated Ultimately Recoverable) oil. Nor does it include other alternative sources like oil shale, oil sands, tar sands, bitumen, heavy and extra heavy oil, deep water oil, polar oil and natural gas condensates.
As Radford University points out, using current proven reserves is *not* a measure of future supply. There is no dearth of oil in the earth. The trick is what is easy to get at for the cheapest costs, and what has been discovered. Nor should unconventional oil sources (i.e. the shale tar sands, etc) be excluded from the mix. From their conclusions here.
Radford also has a page dedicated to uninformed journalists, too uneducated on the subject to question the world’s oil supplies.
Additionally, the costs of extracting oil have remained stable for decades with little increase. In fact, it’s now the converse – technology has actually reduced the drilling costs and environmental impacts. Exxon-Mobil’s fast drill tecnology can reduce the production drilling time for oil and gas wells by 35%.
Go to E&P Mag to check their various news categories and you’ll find countries are actively involved in E&P world wide, with discoveries of fields daily. All countries *except* the US, of course.
As I pointed out in a comment in June of last year, there is a vast shortage of deep water drilling rigs. After the discovery of the western hemisphere’s largest reserve in decades, Petrobras had to order $30 Billion of equipment… 40 ships and deep submersible rigs. All that equipment won’t get to them until 2017.
As Aye and I (tho many think Aye and I are the same person… LOL) try to tell you, the earth isn’t running out of oil. Getting the EUR’s has been politically blocked for personal big money alternative energy ventures. Remember, they (government AND the alternative energy suppliers) will make much more money than the oil tycoons off the American public. Talk about “big bad business”…. instead of “big oil”, you’ll be able to whine about “big alternative energy” corporations instead.
The author of the report you refer to is not “Radford University” speaking, but Bill Kovaik a journalist and teacher at that school.
There is no doubt that their is a finite not unlimited supply of oil (shale or sands too). We consume in the USA a majority of our oil from foreign sources. That means we give them our dollars at an unsustainable rate, while we gluttonously consume all of this limited resource. We use 7.5 Billion barrels of oil a year and 66% of that is FOREIGN oil.
When we consume a barrel of oil, it does not replenish itself naturally. It is gone forever. There may be much oil, but not unlimited supplies and much of our money is going to enrich people who are not friends of the USA. If Iraq or AQ blocked the The Strait of Hormuz or some other disruptions in our major supplies, our economy would be even more crippled. If we are to remain a great power, we need to have energy security.
blast, there is no getting thru to you on this. And I’m not going to waste my time arguing that the earth is in a constant state of creating oil reserves. You choose to buy into the peak oil theory, and refuse to accept that there is more oil in other parts of the world, including alternative options such as shale, etal, that are not included in the environmental lobbyists agenda. So be it.
Your opinion is your opinion. But it is not based on fact and logic, but emotion.