This week, House Republicans unveiled their alternative budget -- a wafer-thin proposal that contained no precise numbers. But the plan did have one big idea: a massive tax cut for rich people! Talk about being tone deaf to the times. While announcing what he called "The Republican Road to Recovery," John Boehner said, "Our economic plan amounts to less government, lower taxes and economic prosperity" -- forgetting, it seems, that the first two had been the GOP roadmap while in power the last eight years and had led to the exact opposite of prosperity. Elsewhere in the GOP, Michael Steele claimed that his many gaffes since taking over the RNC had actually been part of a master plan. "It's all strategic," he said. This coming from the guy in charge of strategy for the loyal opposition. Be afraid.
I'm guest hosting CNBC's Squawk Box next Tuesday morning and I'd love your suggestions, which you can put in the comments to this post.
When spending gets cuts to the point where we have a surplus again - then let's talk about tax cuts. Until then, just cutting taxes is nothing more than trying to buy votes.
Pease, please give some publicity to those economists who consider economics to be a social function not exempt from the common good.
2. The dominance of finance has seriously damaged democracy by its heavy influence on congressional campaigns. Do we want government with an active citizenship or an oligarchy of finance where ordinary Americans have no role other than passive consumer?
How about interviewing William Greider; this is his focus.
For your show
What do the small business owners, and one-person companies ,do for financial help when our clients aren't paying us, and are cancelling contracts and we can't pay our mortgages?
I am a 63 year old entrepreneur, with an 800+ credit score, and am almost finished paying off a 15 year mortgage, to which I've added extra principal every month. I have lost most of my business, have had to lay off my 2 employees, and my clients are either not paying or cancelling.
I've been trying to get Chase bank to lower my mortgage payment to interest only - since DECEMBER and am currently using my Pension to pay the monthly bill. When I speak with them, they tell me that I'm at the bottom of the list for call-backs because I've paid faithfully and am a good customer. They say if i don't pay they will lower my score and foreclose me.
And, because my income fell so dramatically last year, I can't even re-mortgage with a new bank.
Everyone talks about helping those who are being foreclosed because they can't pay. What about us folks who just want to change the terms of an existing mortgage, and are being ignored because we have been/and continue to be, good customers and must use our mortgages to pay?
Thanks.... Sharon Drew Morgen sdm@austin.rr.com
Geithner's plan
Currently, hedge funds will buy Bank toxic assets at less than book value. 6/7ths of the money will be a loan from FDIC insurance funds which will be lost if the Hedge fund walks away from a bad bet. Expect many losses because speculators are making bets knowing you bet 1 dollar to get 7 if you win. Also Geithner uses bailout money to become a partner in the bet with 50 to 80% ownership. Thus, the hedge fund puts up only 2.8 to 7.1 % of the money. Notice Banks will remain insolvent because they get much less than book value. This is why Krugman says the plan will not save the financial system.
Modified Plan
Let the homeowner buy the mortgage with the same deal the hedge fund would have been offered for the same home. The home owner would be more likely to pay back the loan from FDIC because they are motivated to have a place to live. The home owner would not need 6/7ths due to equity. The bank would get closer to book value than from a speculator. This maintains community home values by avoiding bankruptcy.
"We think we can have a successful U.S. auto industry. But it's got to be one that's realistically designed to weather this storm and to emerge — at the other end — much more lean, mean and competitive than it currently is," Obama said.
Note Obama's operative phrase is "much more lean". That means severe cutting of models and losing most of their loyal customer base to foreign cars. US manufacturer share of the US market is guaranteed to drop.
Not surprising but very disappointing. Obama has surrounded himself with the worst of Wall Street. Wall Street only sees short term solutions that include outsourcing as the way to profitability. Summers is the high potentate of "Free Trade" even though it is not free and it killed our jobs and caused the wealth to shift to China. (Obama how is that begging for a trillion dollars from China coming along?).
They weaken the auto industry by their failure to regulate hedge fund oil speculators ($5 gal gas) and worse, totally freeze up the credit market due to their Wall Strreet White House Fluster Cluck. Then they demand the auto industry dismantle until they can be profitable under the horrible conditions they created.
I was promised change I can believe in
Where is it?
President Obama on the other hand wants to shift as much of the private sector to government control as quickly as he can. This didn't work in Europe. It won't work here. I don't advocate out of control materialism or buying things on credit that you can't afford. I guess the President's ACORN buddies didn't get that memo. They harrassed bank execs to make loans when the odds were dubious that they'd ever be repaid. And now, with the President's palns,we stand to have a $9.3 trillion deficit with interest on that debt at just under $1 trillion. IF Republicans can cobble together a conservative coalition, the liberals should be concerned. http://theclosetconservative.com
This "Holier than Thou" attitude has to stop. We have to work together. We live on the damn planet together and we are destroying it together. Lets clean up our act. Giving our children a future is not buying the best and the brightest, its giving them a world that is clean, healthy and worth living on and opening their minds to better things and not just material things. Come on people, we are better than that.
MSNBC is the network I watch the most but I find that most of the Saturday’s and Sunday’s shows are quite depressing. I really do not like those so called reality shows such us “Locked Up”, “Catch a predator,” and “Predator Raw”. I understand that most criminals need to be locked up, I understand that pedophilia and child molestation are very serious crimes. Still, MSNBC / NBC should give us something more uplifting, in particular on Sundays. Why they do not produce shows that display the better side of people?
Anybody agrees?
I am a fan of Barack Obama and believe he is sincerey but Geither and Summer are both one day bringing down the Obama administration.
Also you may want to point out that the former Bundesbank works different as the FED.
http://en.wikipedia.org/wiki/Bundesbank
Example: The chief of the ECB's/Bundesbank have no links to commercial banks and never worked for them, the opposite of the Fed.
To Krugman: How would you rid the system of its toxic assets. What do you think of James Surowiecki's article in New Yorker about the Obama administration's plans.
pushing for the same cool-aide policy of less government, lower taxes and prosperity which ruined
world finance in the first place. It is very sad what this country has become. In Japan, they would all have committed Hari-Kari long time ago.
What we are seeing here is a total failure of this brand of predatory capitalism. Unfortunately, it seems it will bring US down if the administration continues it's juggernaut of lack of regulation and knee-jerk insistence on saving these banks at the expense of saving the real economy.
I'm appalled that the CEO of GM is forced to resign while the CEOs of these banks who committed fraud are let to go on with business as usual. Our $$ is probably in the hands of the tax havens already if not supporting the Medellin Cartel in Columbia. We just don't know where it is going.
I fear we have ALREADY hit the iceberg; we're just waiting for the water to rise to our feet.
And now, more military spending. I think American politicians have all gone crazy.
The GOP need to get their act together and set up a shadow cabinet and start acting like a responsible opposition. Can anyone tell who in the GOP is delegated to speak on Deffence, Education, Homeland Security and so on? Please let me know when you find.
I hope Obama listens to Krugman. If that does not work, then I hope the Chinese government will insist Obama cease wasting money by passing it to the corrupt Wall Street flim flam artists who own most the politicians. The Chinese government must be really pissed that the Banksters are going to destroy the American dollar by forcing the transfer of a trillion government dollars to the corrupt Wall Street insiders.
China has $1.3 trillion at stake in US government investments and the G20 meeting happens in a couple days. I can only hope they do us all a favor and make a credible threat to stop the Grand Ripoff or else they will pull the plug (They can also announce why and gain a lot of friends around the world ). Even though the US would lose a lot of stature by being forced by China to reform the corruption on Wall Street , at least they would be saving us from a depression with hyperinflation to boot.