$700 Billion isn't enough...let's make it an even $1 Trillion

Gee whiz, the U.S. government has certainly been busy this weekend. Senators working close to the end of the fiscal year. Agencies scurrying trying to resolve issues. My goodness, it is looking like the federal government is working in overdrive and making overtime. However, the question of the day is -- will this economic package save the U.S. economy from the coming depression? No, it is not going to work. Recession is a part of the natural economic process. We have one every 7-10 years. However, this time around, it has been exacerbated by poor management and business practices by certain companies with mega-sized lobbying firms. So, why would you give your money to someone who has already mismanaged their own? These companies are in this mess because they screwed up their money, now the federal government wants to give them OUR money, just because. Why would someone think that they would be more careful with someone else's money to play with?

Some have lobbied for greater accountability which in theory is great, however, it will not come. Others have demanded new management for these entities, another theory which is wonderful, but will not work. In order for a corporation to function, those people at the top of the pyramid extend their reach all the way to the base of the aforementioned pyramid and create a certain type of culture. Sometimes this culture is successful and everyone is happy (i.e. Google and Microsoft) and other times it breaks down under its own excess, bloated ego and mismanagement (does anyone remember a company named Arthur Anderson). Regardless, when there is a change at the top, the underlying culture of the corporation does not change because such behavior is learned and then ingrained.

The CEOs can leave, but the reality is that even after they exit, their management will still be firmly in place. Their boards, their executives, their administrations will still be at these floundering companies. I think that people fail to realize that many of the executives and members of the various boards of directors are long time corporate and political cronies. The CEOs will receive their golden parachutes and the next person who takes the helm will be someone with a similar background, understanding and perhaps someone groomed by the person who JUST got a severance package. The policies will be the same because the structure that existed is the one that made them all that money in the first place. It is unfortunate, but CEOs and the BODs bounce around from company to company. Watch, the next thing you will hear is that the former CEO of Lehman or AIG is now the chief strategist/advisor for someone's political campaign, was elected to some company's BOD or is the NEW CEO of some other company that was doing just fine. It's trifling and pitiful, but the hallmark of our type of capitalism which is rife with favoritism and crony-ism.

Now, back to the money (as though I was ever really discussing anything else). $700 billion dollars seems like a lot of money to throw at these institutions, but it is not. Especially since the money may not be as valuable as the cotton blend paper it is printed on. So, I say let's make it $1 trillion. That number sounds much more impressive and probably closer to what it would take to fix some of the problems that cronyism has bought us...

Banking has the largest lobbying force in DC, so why are you surprised?

So this morning is more of a rant and less of a blog. So, forgive me in advance. However, in a previous life I was a regulatory advisor for one of those behemoth national banks and they work hard to keep make money and more money. Yes, they hire lobbyists help the politicians look the other way. And, yes, they hire law firms to block for them when the politicians choose to examine what is going on. My question is this -- why are people acting as though they are SHOCKED SENSELESS by the further consolidation of the financial sector?

I do not get it. I am genuinely perplexed why anyone would think there is anything amiss in last night's purchase of Wachovia by Citi. The writing has been on the wall since the late 80s after several financial institutions failed and then the subsequent scandal ensued. For those who do not know...there WILL be only a small handful of national banks by 2020 (perhaps 3) and there is not enough anti-trust legislation in the world to stop it.

Regional banks have long consolidated their positions in order to leave a larger footprint on their respective markets. Bank of America started doing this on the west coast more than 60 years ago and it really got into its stride under Hugh "Huge" McColl and now Ken Lewis is really hitting his stride with his growing leviathan. But, not to make BofA the bad guy, because they are not. Their acquisitions have helped their stock holders and their bottom line. Yes, it has had its snaffus, like several pesky investigations into its audit procedures or their handling of credit disputes or their questionable underwriting, however, that is to be expected. however, that will happen anytime a company consolidates its position. BofA stretched its tenacles to the east coast with their acquisition of NationsBank, their reach into the north with Fleet and into the midwest with MBNA and not to mention the other significant acquisitions of Countrywide or LaSalle or US Trust or of any number of brokerage houses. No one said a WORD.

Citi has been doing the same thing for a similar timeframe. They have eaten at the table of excess and are still sitting there grubbing. Why? Because Citi can and for that matter, so can BofA. The federal government cannot stop them because their bottom lines are healthier than that of the fed and they probably have better credit ratings. Now, Citi has acquired Wachovia and instead of saving a financial institution teetering on the edge because of the heaviness of its mortgage/real estate portfolio, people are getting a little worried. Why? Are people NOW concerned that credit will be more difficult to acquire by those without existing relationships? Is the American public concerned because they see that in the words of the Highlander, there can be only one (and by that I mean bank)?

I think that in the end, BofA and Citi will co-exist in a type of Nirvana of their own making. BofA will control individual banking and trusts and have a significant chunk of the credit world (and by that I mean a 20-25% share). Citi will own consumer credit (more than 50%) and further extend its reach into the international market where other nation states have even freer financial legislation. I say, go for it. Why not? They already have the lobbyists, the attorneys and the federal government on their side. They cannot possibly do anything worse than what has already been done. The federal government will not allow them to fail, so they are as safe a bet as any. The only thing is BofA, Citi, others of their ilk and their respective executives have a huge appetite, let us just hope it is not an appetite for destruction.

Lobbyists are just as real Santa Claus, the Easter Bunny and the Tooth Fairy

I remember there was a time when certain elected officials called for transparency at all levels of government, however, that time has now passed. It is with a sad heart that I write this entry because the news report I am citing proves that the lobbyists that he previously swore were no part of his campaign do indeed exist. Maverick, no more. Republican with an independent streak, no more. Honest politician, no more. While he was never my candidate of choice, there was a time when I respected him and believed him to be something that Washington needed more of, honest and upright politicians. However, let me state that this has been an erosion of my belief in him as opposed to an immediate epiphany.

So, I sat down to read one of the five papers that I try to read daily and staring up at me from the New York Times was a piece by esteemed writers Jackie Calmes and David D. Kirkpatrick titled (hold on to your seats) "McCain Aide's Firm Was Paid by Freddie Mac." But, it's not just SOME aid, the person in question was Mr. Rick Davis, the presidential hopeful's campaign manager. The Calmes/Kirkpatrick piece goes on to state that McCain's campaign manager's firm received $15,000 a month from one of the companies helped by the federal government in the past weeks, that the campaign manager's firm had been kept on the failing company's payroll "because of his close ties to Mr. McCain" and that "no one at Davis Manaform other than Mr. Davis was involved in efforts on Freddie Mac's behalf." While this $15,000 a month or $180,000 a year is a drop in the bucket when compared to the multi-million dollar salaries of some CEOs, one must realize that this is only ONE of the firms clients. How many other companies' interests are represented? How much does this firm take in from companies whose only interest is the owner's access to someone running for president?

Now, I may not know a lot, but I do know the rudiments of currying favor and it would seem that the behemoth formerly known as Freddie Mac, currently known as part and parcel of the U.S. Government, was doing just that. I expect that the tenacles of huge corporations spread throughout politicians on both sides of the aisle. What saddens me is that the once Maverick stumped on the other's ties to mortage/finance companies and now McCain is just like them. But, perhaps, he always was.

So, in the end, while there are those that say there are no lobbyists involved in electioneering, I invite you to the world in which we currently live -- where they run government, industry and perhaps even what we think and believe. Yes, readers, lobbyists are real.

References:http://www.nytimes.com/2008/09/24/us/politics/24davis.html?_r=2&hp=&adxnnl=1&oref=slogin&adxnnlx=1222267016-nxXDxNJQI4hubQ4WJafcuw

What do you mean? There are Christian Democrats...

In case I failed to tell all of you, I went to a conservative law school. Correction, not just conservative, but a Christian conservative law school awarded me my law degree. My time there was valuable, not just for the legal knowledge, but for the sharing of ideas and ideals. While I am what most would consider a liberal (women's rights advocate, environmentalist, conservationist), I am still a Christian. I place Christ above all and firmly believe that man has immutable rights that cannot be taken away.

Now, I know some of you may say, what do you mean "women's rights?" Well, let me just be clear for you, I believe that women are man's equal. That is why God took woman from man's side, so that she could walk beside him, not behind him, below him, in front of him or above him. And, I believe that there are some decisions that belong to women, and women alone. But, I digress on that point.

I am more than a little saddened and appalled that there are some who believe that if you are a Christian, you can only be a Republican. I don't understand this and I never will. I believe that as long as we have a two party system, we must all work together to try to get this thing we call democracy right, regardless of our personal political leanings. Perhaps that is what has gotten us to this morass we are in right now, partisanship. Maybe we should no longer care whether we are from a Red or Blue state or if we are conservative or liberal and focus on doing the right thing for our country and for our future. Hmm, that doing what's right sounds really Christian...

Perhaps we should teach something other than abstinence only...

Perhaps abstinence only does not work. Perhaps we need to teach children that they have alternatives. It is unfortunate, however, it is a reality of the hyper-sexualized times that we live in. Children need to learn that waiting is the right thing to do because the result can be unwanted pregnancy. Or it could be something much more devastating, like HIV.

I am a Christian and as a Christian, I think that God not only promotes abstinence, but also is an advocate of virginity. By that I mean maybe He wants us to be virgins when we enter our marriage bed. But, Christians sometimes fail. Sometimes we fail horribly. It a result of that pesky free choice of will thing that God decided to give the frail humans that He created. So because we have that free choice of will, we need to be responsible and part of responsibility means protecting ourselves and our families.

Abstinence is supposed to be “the voluntary self-denial of food, drink, or sex…abstinence is commonly taken to mean no sexual activity” (www.medicinenet.com). So, I swear I do not understand how someone who has preached abstinence and refused to pay for sexual education in the public schools now has a daughter who is knocked up. And, then to add to this morass, they issue a PRESS RELEASE that her CHILD who has not begun her senior year in high school is going to marry her boyfriend and I stress BOY. Perhaps I should use another colloquialism -- her “baby’s daddy.”

I advocate and appreciate that the children of politicians and their lives should be off limits. I think it is something we should all strive to because while the politician has chosen to have their lives on blast, their children have not made that decision. My only issue with that when you have a politician that advocates making decisions for other people’s children, somethings need to be examined and checked. Or perhaps someone should have not worried about putting press releases out about their children's mis-steps and focused more on the turmoil that comes with having a parent through not only themselves onto the national stage, but their entire family under the media's microscope.

Perhaps some parents have already gotten down on their knees and thanked God that the only thing that their children are not battling an incurable disease and that sometimes the only thing that comes out of unprotected sex and subsequent pregnancy is a press release. Hoever, now that it is done, perhaps some people will come to the realization that abstinence only does not work. Perhaps children need to be taught that if they are going to act like adults, they need to know the adult alternatives in order to protect themselves and their health. Perhaps we should get back to the fundamentals and teach our children that with free choice of will comes a responsibility to protect oneself. And, protection is what I am an advocate of...

http://www.cnn.com/2008/POLITICS/09/01/palin.evangelicals/index.html