Clintonomics Has Devastated Our Economy - AGAIN!

SO WHAT DO WE DO NOW?

Few would argue that it would wise to put an alcoholic in charge of a bar. So why did Bush put Henry Paulson, the former CEO of Goldman Sachs and one of Wall Street’s $38,000,000 a year hotshots and a definite insider, in charge of the financial meltdown? Paulson recently asked for $700,000,000 of taxpayer’s money, with no restrictions – just let him decide how much and when to hand our money over to any firm of his choosing. Bush should have fired him on the spot for requesting such a ridiculous arrangement. Yet Paulson is still suggesting and executing reckless blunders that are costing the American taxpayers hundreds of billions of dollars.

For example, Paulson foolishly put $85 billion of taxpayer money into AIG, and incredibly cited a warrant to purchase AIG shares as our protection. PROTECTION? You’ve got to be kidding! The bigwigs at AIG knew they had snookered Paulsen and went on a $400,000 vacation – at our expense. They knew that they would need more money AND that under the warrant arrangement, Paulsen would have to give them more of our money in order to protect the $85 billion down payment. And so it went; another $38 billion of our taxes was forked over to the AIG honchos who had just come back from their extravagant vacation.

Where is common sense? What Paulson should have done, and what he (or hopefully someone else) should do with the rest of these big lenders and investment firms, who bet wrong and lost a lot of money, is quite simple. Yes, the market must have liquidity and it must come quickly. Everyone can agree on that. However, the big question is: What is the best method of accomplishing that necessity?

There are six major factors that must be part of any proposed solution:

1. Lenders must have a dependable source of capital.
2. The American taxpayer must have total protection.
3. Any pain (there will be much) should be experienced by those who are responsible for the poor decisions and greed that caused the problem.
4. All of the Clintonomics BS factor must be squeezed out of the system in order for us to regain a sound financial foundation and return confidence to the markets. The phony subprime equity that has been pumped into the financial networks because of the repeal of the Glass Steagall Act and the gross (possibly criminal) misuse of Fannie Mae and Freddie Mac, must be pumped back out of the system. Until reality, accountability, and common sense are discernibly restored, the vast majority of American investors will not consider putting their money in the stock market, which is one of the main sources of new capital for the companies that make up our economy. As long as there is the perception of pockets of Clintonomics still in the financial markets the economy will not run on all cylinders.
5. Like the former blue chip stock and that was once a part of the Dow Jones Industrial Average, Penn Central Railroad ceased to make wise business decisions and went out of business. Good! That is how capitalism works; the best companies survive and prosper, and the poorly run companies fall by the wayside. The consumer wins. Other railroads bought their tracks and trains. Penn Central’s former employees went to work elsewhere. Good! Remember Pan Am, Eastern Airlines, and Nash Rambler cars? Those companies ceased to exist, but the market place filled the void. Well the same basic theory must be applied to this current chapter of the American business book. Some of these lenders and investment firms should not be “saved” by the American taxpayer.
6. The markets – not Obama’s socialism - must be the major part of the solution. The main culprit in this financial nightmare was an abuse of power by the Clinton administration – the government. Suggesting that a take over by the government of large segments of our economy is the best solution is absurd. George W. Bush is still reeling from the “Katrina effect” and is paranoid about once again being accused of not taking action quick enough. He is now ready to agree to anything and sign it as fast as he can – “Mr. Paulson, please tell me where to sign and take the $700 billion.”

THE SOLUTION

If an American citizen was in financial trouble, and he or she went to a bank for a loan, the banker would probably not lend them any money. However if a loan was offered, you know that every asset that person owned would be required as collateral, and that the loan would be for considerably less that the actual value of the pledges assets. The banker would want adequate security – and rightfully so - because the banker needs to protect the interests of his other clients.

Well now the bankers are in trouble and they want money from the taxpayers to bail them out of their poor decisions and greedy lending habits. Incredibly, with the help of Henry Paulson, George Bush, Nancy Pelosi and a long list of recipients of campaign contributions from the lenders in question, these risk takers who gambled and lost want handouts and expect us (the taxpayers) to pay good money for their worthless subprime loan “portfolios”. Thanks, but no thanks.

Here is the deal – take it or leave it! The lenders need liquidity. OK! We (the taxpayers) need protection. Say yes! OK! Our message to any lender who needs liquidity, but who can not get a loan through normal channels can come to the U.S. Taxpayer Bank. Bring the title, deed and certificates to all of your assets. We will lend 50% of the value of your hard assets (not the Clintonomics BS factor – subprime loans) as a line of credit. You will agree to forgo any protection from the bankruptcy courts. If you default, we will seize your operations and liquidate all of the hard assets. Like Penn Central some of our current financial institutions need to be given the chance to succeed or fail, and if they fail – OK! Other companies will buy their assets and their employees will work somewhere else. The taxpayers will get their money back, maybe make a little money, and one more pocket of the Clintonomics BS factor will have been purged from the system.

If the lenders don’t like this arrangement (they won’t – they like the idea of uncle Paulson’s handouts much more), then they need to call Warren Buffet, a competitor, or another hard lender other than the U.S. Taxpayer Bank. That should be their first choice. The U.S. taxpayer should be the lender of last resort and the toughest to bargain with. Squeezing the Clintonomics BS factor out of the market needs to be done quickly and completely. It will not be pretty and it will be painful for many. There is no shortcut or painless way to save a severely infected limb in order to avoid amputation. It must be done, and it must be done immediately! Our future depends on it!

As long as these lenders think that George Bush, Henry Paulson and Nancy Pelosi and their cronies will bail them out, they will not take the necessary action. We need leadership! Let’s get on with it and rebuild our national wealth, rebuild trust in the system and rebuild the confidence of the American people. Where is Ronald Kennedy?

Today, Paulson, Bush, Pelosi and their anti-American taxpayer buddies lifted another $250 billion out of our wallets and INCREDIBLY agreed to “invest” our money in these poorly run companies. Have they already forgotten the $85 billion and the additional $38 billion boondoggle at AIG? Why are they such slow learners? It wouldn’t matter if they were wasting their own money, but of course Henry Paulson’s Wall Street buddies wanted our money – not their own. Where can we hide our wallets? Barrack, George, Nancy, Henry and their friends are just getting started.