In 2008, Candidate Obama promised to filibuster any FISA bill which included amnesty for the telcos assisting President Bush’s illegal spying on American citizens without a warrant or anything near the probable cause it should take to get one. He then turned around and not only did not filibuster it, but actually voted for the bill.

As President, Obama has promised only to “review” this activity and the use of the states secrets excuse to avoid having to face accountability in court to defend the shredding of the Fourth Amendment.

In arguments in the Jewel vs NSA case, the Obama Department of Justice has gone even further. Besides invoking the states secrets privilege claim, the DOJ argues that the Federal government is IMMUNE from ever being sued for violating privacy laws. They claim that the Patriot Act grants the government immunity from lawsuits filed over violations of the Wiretap Act and the Stored Communications Act.

Franklin Roosevelt said “the only thing we have to fear is fear itself”. Be afraid – be VERY afraid. The Hope and Change seem to be forgotten, but Fear Itself remains. We had to bail out the perps who wrecked our economy (and don’t stop to think about what we are doing, or Fear Itself, Banking Edition will catch you) and we have to give up our freedom and security or Fear Itself, the Terrorist Edition, will kill you.

“All this has happened before and will happen again.” Unless we do something differently (you know, actually Change).

Remember the days when it was legal to read a book to your kids? Apparently those days are gone, if you believe the position of the Authors Guild. They contend that if you buy a book to read with your eyes, you need to pay for it again if you want to turn it into a spoken word performance.  Amazon apparently believes it too.

April 7th, about 300 blind people, plus dogs and kids, gathered outside the Authors Guild headquarters in New York to protest their bogus copyright claim and the fact that Amazon caved into it and disabled the text-to-speech capability found in the original Kindle when they released the Kindle 2.

The Authors Guild is showing the usual short-sightedness typical of the media industry, as it will cost their authors sales in what could have been a way to open up the market without the expense of producing Braille books. Amazon’s willingness to throw their customers under the bus shows where their loyalty lies as well. I’ve worked in distribution much of my life, and siding with your vendor against your customer is just bad business.

By the way, you have my permission to read this article to your kids, and anybody else who will listen. Then email your Barnes and Noble receipts to Amazon along with a copy of it.

I really should have made this number one. This is the place where we can have the biggest impact on economic growth, job creation, the environment, and national and international peace and security. Even if you think global warming is a myth and/or there really were WMDs in Iraq, there is still enough here that makes reducing fossil fuel usage and replacing it with clean renewable energy a good idea.

Last summer, I drove out to Arizona for business, stopping in Albuquerque to visit my sister on the way back. Along both I-20 and I-40, I saw some windmill farms, but I also saw lots of empty space where many more could be. As I got closer to my home, I really wanted to turn around and head back out West. Heading east through Mississippi and Alabama, on any part that is elevated, you see a nasty brown cloud in the sky. Welcome to Georgia Power, a Southern State. They don’t even bother with the delusion of “clean coal”. Only with action at the Federal government level is that ever going to get cleaned up. The Georgia Legislature point of view is “we’re keeping power as cheap as possible even if it kills you.”

That’s the problem, isn’t it? Changing our energy infrastructure means we have to pay more today to get a benefit in the future. It’s not just big corporations who are stuck on making this quarter’s financials look good at the expense of sustainability. We all do it. We have become a nation whose largest product is debt. Too many of us look at purchases not as “Do I have the money in the bank to pay for this?” but as “Do I have enough room under my credit limit to pay for this?”

The way to overcome this is to change the cost structure via taxes, tax credits, and government spending habits. The same Congressmen who decry bailouts as socialism had no problem giving Big Oil tax credits during the years they were making record profits. The US has the lowest gasoline taxes of any developed nation. Companies get special tax treatment for purchases of pickups and truck-based SUVs, the least fuel efficient vehicles out there. We sort of have tax incentives to buy hybrids, but there is a cap on the number of vehicles sold that qualify. All this is backwards!

When gas prices hit $4.00 a gallon last year, we finally started to see a change in car buying habits. Adding $1.00/gallon tax would raise $127 billion dollars in a year, based on Energy Information Administration statistics. Use this money to increase the tax credit for hybrid purchases. As hybrid production increases, the difference in price between hybrids and standard versions will decrease. (The research and development costs are the same whether you sell 1,000 or 1,000,000. The R&D cost per car changes drastically.)

The other piece of this is in the generation of electricity. The technology exists for large scale solar and wind generation. What is needed is the infrastructure to store and distribute power from areas where it can be generated most efficiently to areas where it cannot. We need large scale production and investment in a “smart grid” that can do efficient distribution.

This investment can come from the market, but only if there are clear and consistent policies that investors can rely on for years to come. You can’t expect people or companies to invest in something if they have to fight with Congress each year to keep the rules from changing. There is a company in Ohio that developed a cheaper solar panel suitable and economical for use on private houses. They are doing well and have built a new plant that created lots of new jobs. But it’s not in Ohio. It’s in Germany, where their customers are. Why is it there and not here? Because the German government requires utilities to buy back your excess power from your solar panels at the same rate it costs them to generate electricity.

These tax policy changes are not socialism. This is not “redistribution of wealth”. This is “We the People” acting in concert to prevent individuals from escaping paying for the environmental and health care costs of fossil fuel pollution. As oil usage decreases, the profits of oil producers decrease. On a national security level, this reduces terrorist capital. Oil money is what keeps the House of Saud in business, and splinters of the House of Saud form both the financial and ideological backbone of Al-Qaeda. Oil money funds Iran, which uses the same ideology to promote its national self-interest. If we didn’t need to meddle in the Middle East in the name of securing our energy supplies, we would further undercut terrorist propaganda and recruitment. This in turn would reduce our defense spending requirements, and let us use that money instead to pay down debt and invest in production, not destruction.

“All this has happened before and will happen again.” Unless we do something differently.

It used to be that the term “Bank Heist” meant a gun, a mask, and handing the teller a note that said “Your money or your life.” Now it means bank execs who have been totally reckless in their pursuit of this quarter’s income statement with no regard for what happens next quarter going to Washington and handing all of us a note that says “Your (bailout) money or your economy.” And like the bank robber of old, you still might get shot anyway.  In this case, it means that the banks who took our money under threat of imminent economic collapse by the extinction of credit will still refuse to lend money to the small businesses that drive the innovation that will create the next recovery.

The millionaires will still get their bonuses and their new luxury box offices. The best and brightest whose greedy fraud started this whole mess and wrecked the balance sheets of not only their own companies but every homeowner and everyone with a 401k or IRA as well won’t suffer at all.

The current economic downturn is largely tied to the bubble in the mortgage and housing industries. It started innocently enough. Washington felt that mortgage companies were refusing to lend to blacks based on race, not on statistics. Fannie Mae and Freddie Mac were set up to back up and insure the banks for mortgages they would not have made otherwise. The banks still weren’t comfortable with the idea. So an industry evolved where new companies originated the mortgages and then sold them to other companies who had to actually collect the payments. The originating companies worked on ways to get creative and making people appear to be qualified, and didn’t care if they went too far because they wouldn’t have to collect the payments. The banks were happy to buy the mortgages because they could honestly tell Washington that they had no say in who got approved and who didn’t, and there was insurance for the defaults anyway.

So for awhile, everyone was happy. Since more people than ever were being qualified to get a mortgage, housing prices were rising fast. Builders were in heaven, because the price of housing is not a function of the cost of construction. The same leaky, energy-inefficient piece of crap that was profitable to build at $150,000 was now immensely profitable at $300,000.

Competition in the mortgage industry led to ever more creative ways to get less qualified people into ever more expensive homes lead to even more creativity on the banking side. Subprime mortgages (read: “We know there’s no way in hell these people will be able to keep up with what these payments will be in year two, but they believed us when we told them they could afford it.”) were packaged into derivative securities so opaque even financial professionals had a hard time figuring out what they were buying, but everybody else was making money off of them, so we might as well too. The came the “credit default swaps” designed to protect against the first derivatives being the 2000’s answer to junk bonds. Except that they were ultra junk bonds, because a huge percentage of the gimmicky mortgages either are or will be in default. They are loans that should never have been made.

This grand pyramid scheme started to unravel as early as 2006. But the builders kept building, and those local banks that had most of their business in loans to those builders didn’t adjust quickly enough either. Eventually, the credit default swaps started to be called in, and AIG and other companies could not make their payments either.

Congress and state legislatures keep talking about “stimulating the housing industry” as though we could go back to January 2006 just by throwing dollars at the problem. The problem is that just about every house purchased in the last five years was NEVER worth what was paid for it. The mortgage and mortgage-backed securities scams created an artificially high demand that created artificially high prices.

As for builders: if you didn’t put away anything from the glorious profit years, then you’re as dumb as Congress was during that time running deficits during an economic boom. Tip: use your down time to figure out how your company can make energy efficiency improvements to existing structures a better investment than with anyone else. That’s going to be the next bubble. If you get there before it becomes a commodity, you can become very profitable and make the world a better place.

As for the banks: “Too big to fail”? No, too big to succeed. “The best and brightest”? Not likely. More like the greediest and most selfish. By propping up the dinosaurs, we are making it harder for smaller companies with innovative ideas to get the space they need to grow the right way: by helping to create real wealth, not just paper gains.

So who should we help? The companies that invested heavily in instruments they did not understand? The companies that created those instruments precisely because no one could understand them because anyone who did understand them would never buy them? The people who bought homes they should have known they could not afford? The mortgage “professionals” who told them they could afford them?

Personally, I am tired of bailing out the perps and not the victims. There is a group that is not talked about in all this – the people who bought houses in the past five years who can afford them (even though the scams did make them pay more than they should have) who can’t refinance now at the low interest rates because they owe more than the current market price of the house. These people should be able to have their current mortgage holder adjust the rate/terms on their mortgage without going through thousand of dollars in fees. You should just have to document current employment, and not have ever been behind on your payments. If you have been keeping up current payments, then obviously you can afford LOWER ones. Banks could go a long way toward earning their citizenship back by doing this on their own rather than waiting for Congress to drag this out of them kicking and screaming. This savings for middle class families would then go back into the economy in other ways, like art classes for talented child or seed money to start a new business.

“All this has happened before and will happen again.” Unless we do something differently.

There is much debate at the moment over President Obama’s budget proposal and what it would do to the budget deficit.

First off, some basic economic theory that I haven’t seen mentioned by politicians of either party or any of the alleged “news” media. Capitalism has up and down cycles. It always has, and it always will, because each cycle gets exaggerated by a different bubble or bubbles.  The Cylons have a saying:  “All this has happened before and will happen again.”

So how do these bubbles start?

They start with a new idea that works, which then gets copied enough to become mainstream, at which point it is no longer wildly profitable unless you come up with a marketing twist that adds no actual value to the world other than to move money around. Eventually enough people realize that the emperor has no clothes, and the bubble bursts. It happened with the dotComs, it happened with the Enrons and MCIs. Those were traumatic to a few people and industries, but the economy as a whole recovered quickly enough because the middle class in general was not threatened by those scams. When it happened with gimmicky mortgages, the whole world got screwed. This will be a whole article on its own very soon.

What should government’s role be?

Government’s role in these cycles should be to move “anti-spinward” to try to keep the cycles from going too far off center. When the economy is booming, government should be running at a surplus, so that when a down part of the cycle is reached, there is money available to pump into the recovery. At that point, government runs at a deficit until the economy recovers, at which point government should then pay down any overall deficit incurred and resume building a surplus for the next cycle.

The problem we face now is that during the prosperity of the mid 2000′s our government ran at a deficit instead of a surplus. Never before in history has a country fought two wars while cutting taxes. We gave tax breaks to oil companies while they were recording record profits on historically high oil prices in part caused by the wars we were fighting with borrowed money.

So we are now faced with a situation where the government should be running at a deficit to alleviate the worst economic downturn in a long time. We should be coming together to fix things. Instead we have politicians who would rather things got worse as long as they can’t get credit for fixing them. And a media and public who can’t seem to tell the truth from the blame game (I am referring to the Republican response of “See, he’s being partisan” to Obama stating “I inherited this mess”.)

So we bail out the “too big to fail” corporate perps who got us here, and debate moving forward vs business as usual under the guise of people vs small business. That’s the biggest PR lie since “trickle down economics”.  Senator Judd Gregg (R-NH) said “It is the individual American who creates prosperity and good jobs, not the government.” What he should have said was “It is the individual American who creates prosperity and good jobs, not the government or the large corporations it works for.” Because the rest of his platform calls for business as usual, which means people and small business get to keep subsidizing bonuses for committing fraud.

The Georgia Legislature continued to show its contempt for its citizens and support for its corporate sponsors by passing HB 480.  This bill will eliminate the sales tax and the annual ad valorem tax on cars purchased in Georgia after the end of 2009.  In its place, a 7% fee will be charged for titling the vehicle, with a cap set at $2000.

What’s wrong with this?  For one thing, it means that cars costing $28,571 and up all pay the same fee.  So the biggest tax breaks go to the most expensive cars, and luxury cars and SUVs are the worst offenders in terms of gas mileage and pollution.  Great public policy!  Of course this should be expected from one of the states where the Governor is considering rejecting Federal stimulus money because he doesn’t want the state to be held accountable for how it is spent.

Secondly, this new title fee would apply to private sales of used cars.  Currently no sales tax is charged. Who benefits from this?  Car dealers, and only car dealers.  When you sell a used car to a dealer, you pay less than it is worth.  When you buy a used car from a dealer, you pay more than it is worth.  Private sales benefit both parties involved,  but they rarely involve anyone in a position to buy votes, so guess who’s side the Georgia Legislature is on?

Some have expressed concern that this will cause more dealerships to fail because people wait until 2010 to buy new cars.  Probably part of the plan.  The largest dealerships will have the best chance of riding out the year, and in 2010 there will be less competition and higher prices for everyone.

One law for the rich is alive and well in the state of  Georgia Power.

There is new voice advocating a part of the Legislative Accountability Amendment:  www.readthebill.org

It’s common sense really – if ignorance of the law is no excuse for those who have to follow it, how much more important is it that those who vote on creating the law have actually read what they are voting on.

It is also important for concerned citizens to have an opportunity to read and contact their representatives on the details of a bill, not just the (usually misleading) title and the ten second sound bite of what the bill’s sponsors (and/or anti-sponsors) claim it will do.

Publishing the complete text of each bill for 72 hours before debating/voting will make government more transparent and more responsive to the will of the people.

To those of you who say “Who cares?  I haven’t got time to read that stuff anyway”, then support my idea of limiting bills to no more than 2 pages.  Much easier to read and much harder to hide special interest catering.

It appears that the opposition to bailing out the “Big 3″ in Congress was really about coming up with a way to make it look like some changes would be forced on the automakers.  However, the strings are really more like very frayed threads designed to make sound bite level excuses for “why I had to vote for the bailout”.

First of all, the money will come out of the funds that were supposed to be used to make more fuel efficient cars.  So the strings on that money are now gone entirely.

Secondly, look at this statement from an AP news story:

“Pelosi was seeking a provision that would bar the automakers from using any of the funds to pursue a legal challenge to states seeking to implement tougher auto emission standards.”

Using any of the funds?  So as long as its not this particular serial numbers on the dollars paying the lawyers its OK?  This is one of those things that makes me consistently want to ask our elected officials “Are you really that stupid or do you just think I am?”

If taxpayers are going to bail out failed corporations with failed business models (and make no mistake about it, between the grossly overpaid and underproductive management and the grossly overpaid and underproductive union workers that is the case), there should not be threads attached.  Not even strings.  There need to be chains.  Serious, thick, lawyer-lobbyist-and-Congress-proof ones.

Like these:

• A Maximum Wage restriction:  no employee or individual working as an indepent contractor can be paid more that $100,000/year including bonus, commission, benefits, stock, stock options and deferred compensation.  This should also apply to anyone being paid by the UAW or any other union involved.
• All “golden parachutes” are made null and void by accepting the bailout money.  No bailout funs will be made available to the company until and unless each and every employee and/or officer with such an agreement signs their consent to this.  Bankruptcy law is amended to state that “golden parachutes” get paid last in a bankruptcy proceeding, regardless of any wording in them designed to go around bankruptcy law.
• Any auto manufacturer accepting bailout money surrenders the right to “pursue a legal challenge” to any emissions requirement of any governmental unit within the United States for the next ten years.
• The UAW agrees to negotiate immediately to reduce wages and to loosen restrictions on firing unproductive employees.  The union is to provide a plan for increasing average worker productivity by at least 10% per year for the next three years.
• Public disclosure of detailed financial statements each quarter by each company accepting bailout money, and the UAW, until such time as all bailout funds have been repaid.  Even privately held corporations like Chrysler.

It truly amazes me how we don’t money for education or health care, but we have money to bail out incompetent manufacturers and fraudulent banks.

Congress and the President told us that the $700 billion bailout for banks and Wall Street was necessary to help Main Street, and it had to be done RIGHT NOW.  No time to stop and think about doing something actually useful – if we don’t give the financial industry all our money RIGHT NOW the whole economy will grind to a halt.

Well, the stock market is still falling, more layoffs and plant closings have been announced, and government officials are actually using the word recession as something more than a vague concept that could be rendered obsolete merely by throwing money at banks.

So what is going to get done with this $700 billion?

Suntrust announced better than expected profits, but says it still expects to take advantage of the bailout money.  PNC is using our money to buy up National City.  So far, the bailout is being used for the big banks to get bigger.  How does this help the economy?  How does reduced competition in the banking industry help consumers and small businesses?

It doesn’t.  It only helps the big banks.

Does it help those of us actually paying our mortgages on property that was overpriced due to the artificial demand for housing created by a mortgage pyramid scheme that separated those who generated the loans (and collected their commissions) from those who had to actually collect on them?

It doesn’t.  The bubble has burst and our equity is gone.

On the other side, we have politicians calling for the government to step in and let people keep homes that they were never able to afford and should never have bought in the first place.  When did “life, liberty and the pursuit of happiness” become “you owe me a house and a car”?

Maybe the entire working middle class of America should go to Vegas, keep gambling until all the credit cards and home equity lines are completely maxed out, and declare bankruptcy.  It seems to be working for the banks and for Congress.

The latest attempt at Welfare for Wall Street is underway in the Senate, with a new bailout bill, not restructured to get taxpayers more for their money, but with other, totally unrelated, items added to it.  Apparently, Harry Reid thinks a spoonful of sugar will help the bailout go down.

The bailout now appears as an amendment to a bill requiring health insurance to provide mental health coverage that is no more restrictive than general medical coverage.   Also packaged in with this is another one year patch on the Alternative Minimum Tax (how about a permanent fix for this indexing it to inflation,  boys & girls?), the extension of tax breaks for alternative energy and conservation (should have been passed on its own months ago), and tax relief for disaster victims.

These are all separate issues that need to stand (or fall) on their own, not be used as excuses to waste taxpayer money on insulating banks from their own bad business decisions, and further proof of why we need the Legislative Accountability Amendment.