My Beauty Best Teacher

Although I am no expert in this, I have always felt that the 1930's were an interesting time period in our nation. The Victorian age had come to a bloody conclusion with World War One, and a whole generation of people were now being raised in a society that saw their parents as failures- their attempts to repress their sexual urges, their attempts to stick to the old ways, their attempts to put in place world peace, their attempts to build multinational nations- all had led to one of the most bloody and brutal and worthless wars of all time. Technology was changing fast- cars and telephones and radio and motion picture- and the children of the 1910's and 1920's thought that they had everything figured out- they thought that where other generations had failed due to their reliance on religion, traditional values, free markets, republicanism, and limited government, they would succeed by figuring out a third way of doing things, a practical way of doing things, a way of doing things that used the power of government to make society a better place to live. This new generation, horrified by WWI and mocking their parents lack of technology skills, had it all figured out, and ushered in an era of fascism and communism and World War Two.

In my post 1930's Are Root of All That is Wrong I cataloged all of the laws that were passed in the 1930's in America that are with us today- such as the Unemployment Compensation Tax (MI, 1936), Oil and Gas Severance Tax (MI, 1929), Social Security Act (USA, 1935), Fair Labor Standards Act (USA, 1938), Smoot-Hawley Tariff Act (USA, 1930), Hoover Tax Hike (USA, 1932), National Labor Relations Act (USA, 1935), Private Schools, Act 302 of 1921 (MI, 1921), Roosevelt moves traditional Thanksgiving Day (1939), Regulating Firearms, Act 373 (MI, 1927), US moves off gold standard (1933), Reapportionment Act (USA, 1929), etc. Looking through that list and thinking of how much America was changed by one generation, by one President, by one party, by one decade (mostly), I was always stunned, and wondered how people had let that come to pass.

As it turns out, the Republican Party of 1936 had put together a platform to oppose a lot of these fascist ideas, but people loved their hope and change and returned FDR to the White House instead, and so the Great Depression dragged on for another decade. Via Conservative Hideout, let's take a walk back in history and see just exactly what the GOP was offering as an alternative back then to the high taxes, high regulation, crony capitalism, fascist third way system that FDR was pushing our nation into. Here is a good chunk of the 1936 Republican Party Platform:

1936 Republican Party PlatformAmerica is in peril. The welfare of American men and women and the future of our youth are at stake. We dedicate ourselves to the preservation of their political liberty, their individual opportunity and their character as free citizens, which today for the first time are threatened by Government itself.

For three long years the New Deal Administration has dishonored American traditions and flagrantly betrayed the pledges upon which the Democratic Party sought and received public support. The powers of Congress have been usurped by the President... the rights and liberties of American citizens have been violated... regulated monopoly has displaced free enterprise.... it has intimidated witnesses and interfered with the right of petition... it has been guilty of frightful waste and extravagance, using public funds for partisan political purposes... it has promoted investigations to harass and intimidate American citizens, at the same time denying investigations into its own improper expenditures... it has created a vast multitude of new offices, filled them with its favorites, set up a centralized bureaucracy, and sent out swarms of inspectors to harass our people.... it has bred fear and hesitation in commerce and industry, thus discouraging new enterprises, preventing employment and prolonging the depression.... appeals to passion and class prejudice have replaced reason and tolerance.

To a free people, these actions are insufferable. This campaign cannot be waged on the traditional differences between the Republican and Democratic parties. The responsibility of this election transcends all previous political divisions. We invite all Americans, irrespective of party, to join us in defense of American institutions. We pledge ourselves:

...To preserve the American system of free enterprise, private competition, and equality of opportunity, and to seek its constant betterment in the interests of all.

The only permanent solution of the unemployment problem is the absorption of the unemployed by industry and agriculture. To that end, we advocate: Removal of restrictions on production. Abandonment of all New Deal policies that raise production costs, increase the cost of living, and thereby restrict buying, reduce volume and prevent reemployment. Encouragement instead of hindrance to legitimate business. Withdrawal of government from competition with private payrolls. Elimination of unnecessary and hampering regulations. Adoption of such other policies as will furnish a chance for individual enterprise, industrial expansion, and the restoration of jobs.

Society has an obligation to promote the security of the people, by affording some measure of protection against involuntary unemployment and dependency in old age. The New Deal policies, while purporting to provide social security, have, in fact, endangered it. We propose a system of old age security, based upon the following principles: 1. We approve a pay-as-you-go policy, which requires of each generation the support of the aged and the determination of what is just and adequate, 2. Every American citizen over sixty-five should receive the supplementary payment necessary to provide a minimum income sufficient to protect him or her from want. 3. Each state and territory, upon complying with simple and general minimum standards, should receive from the federal government a graduated contribution in proportion to its own, up to a fixed maximum....

...Nearly sixty percent of all imports into the United States are now free of duty. The other forty percent of imports compete directly with the product of our industry. We would keep on the free list all products not grown or produced in the United States in commercial quantities. As to all commodities that commercially compete with our farms, our forests, our mines, our fisheries, our oil wells, our labor and our industries, sufficient protection should be maintained at all times to defend the American farmer and the American wage earner from the destructive competition emanating from the subsidies of foreign governments and the imports from low-wage and depreciated-currency countries....

...We recognize the existence of a field within which governmental regulation is desirable and salutary. The authority to regulate should be vested in an independent tribunal acting under clear and specific laws establishing definite standards. Their determinations on law and facts should be subject to review by the Courts. We favor Federal regulation, within the Constitution, of the marketing of securities to protect investors. We favor also Federal regulation of the interstate activities of public utilities...

...We pledge ourselves to the merit system, virtually destroyed by New Deal spoilsmen. It should be restored, improved and extended. We will provide such conditions as offer an attractive permanent career in government service to young men and women of ability, irrespective of party affiliations.

The New Deal Administration has been characterized by shameful waste, and general financial irresponsibility. It has piled deficit upon deficit. It threatens national bankruptcy and the destruction through inflation of insurance policies and savings bank deposits. We pledge ourselves to: Stop the folly of uncontrolled spending. Balance the budget—not by increasing taxes but by cutting expenditures, drastically and immediately. Revise the federal tax system and coordinate it with state and local tax systems. Use the taxing power for raising revenue and not for punitive or political purposes.

We advocate a sound currency to be preserved at all hazards. The first requisite to a sound and stable currency is a balanced budget. We oppose further devaluation of the dollar. We will restore to the Congress the authority lodged with it by the Constitution to coin money and regulate the value thereof by repealing all the laws delegating this authority to the Executive....

...We assume the obligations and duties imposed upon Government by modern conditions. We affirm our unalterable conviction that, in the future as in the past, the fate of the nation will depend, not so much on the wisdom and power of government, as on the character and virtue, self-reliance, industry and thrift of the people and on their willingness to meet the responsibilities essential to the preservation of a free society.

The President of the United States fills a lot of important roles in our political system- Commander-in-Chief, Chief Executive, Chief Legislator, Chief Jurist, Chief of State, Chief Diplomat, Head of Political Party, Popular Leader, etc- and to the list of these roles we now apparently must add 'Investor-in-Chief.'

Head of executive branches, whether at the state level as Governors or at the national level with our President, increasingly believe that it is part of their job description to take the money that taxpayers send to them to perform important government functions and instead gamble that money away on risky investments- the more risky and uncertain the investment, the more it seems that these executives are likely to dump precious taxpayer money into them.

Here in Michigan, we had a Governor that won a second term of office believing that she was a good Governor because she dumped taxpayer money into 'green energy' and 'cool cities' and the movie industry; upon further review and looked at with a true eye for costs and investment gains, these investments all turned out to range from bad to poor to horrible. Taxpayer money was distributed in a corrupt manner based more on political favors and little to no lasting gains came from these investments, certainly not enough to justify calling these schemes 'investment' in the private marketplace.

At the national level, Barack Obama believes that one of his major roles as President is to direct investments for the future, in spite of his lack of experience, training, or record of success in investing. No one would ever hire him to direct their personal investments, and yet as President he is doing just this with our public money at a time when public money is in short supply and needed ever more vitally. And the process that these investments are awarded are corrupt, filled with political considerations and backroom deals that would put any private businessman in prison for their actions.

The Washington Post writes about this role of the President in its article Barack Obama, investor-in-chief. From the article:

Would you buy a used car from Barack Obama? Or would you want him managing your 401(k) investment retirement plan at work? The president, of course, isn’t in that business specifically, but in a larger sense he’s been investing our money, picking the businesses he thinks will fuel economic expansion, new jobs and the technology of the future, and rebuild the nation’s fraying infrastructure.

All it takes is money - ours - he says, and he’s been spending it as fast as he can in a failed attempt to get the economy growing again. The economic policy term for this is “central planning,” wherein the government tries to pick the winners and losers and dumps hundreds of billions of dollars into various business sectors in the belief that it will pay off in the long run.

The government isn’t very good at this business, as we’ve seen in the disastrously ineffective $825 billion spending stimulus plan that President Obama and the Democrats shoved through Congress in 2009. Much of that money went into the budgets of countless federal departments, agencies and other programs that spent it. Still more went to states, counties, cities and towns for infrastructure programs or to keep public workers employed. A lot of the money was given to businesses that Mr. Obama thinks will be good for the environment, though his investment decisions didn’t always work out the way he hoped.

Consider the White House-backed solar energy firm Solyndra Inc., which declared bankruptcy this week after pocketing a $535 million loan guarantee from the U.S. Department of Energy. Critics called the deal a “stimulus black hole.”

When Mr. Obama visited the Solyndra factory in May 2010, he called the company a success story that was “leading the way toward a brighter and more prosperous future.”

He was quite proud of his investment, boasting at the time, “Less than a year ago, we were standing on what was an empty lot,” but now here was this shiny, new factory that “is the result of those loans” backed by his administration.
It was later learned that the White House fast-tracked Solyndra’s loan application, rushing Mr. Obama’s pet project through without a lot of serious checking. Federal investigators said that the administration had bypassed procedures to safeguard the taxpayers’ investment.

Mr. Obama is big on the solar-panel industry and under his policies, the government has dumped a lot of our money into it in the past three years. But it turns out that the U.S. industry has not turned out to be the bonanza that he sold to the country. Prices for solar panels have fallen because of strong competition from China, making the fledgling industry precarious at best without heavy federal subsidies.

Evergreen Solar Inc. filed for bankruptcy last month after being forced to close its plant in Massachusetts that was built with state and local government subsidies.

Senate Energy Committee Chairman Jeff Bingaman, New Mexico Democrat, says the loan guarantee program “has not worked as well as we had hoped.” Sounds like a Wall Street investment banker defending a fat bundle of subprime real estate securities that went bad.

The solar-panel industry is not the only “investment” Mr. Obama has sunk a lot of our money into. While the plants build with his loans make for great campaign photo ops, the costly reality is that government is trying to pick the winners and losers in our economy instead of the private sector.

But Mr. Obama thinks he’s good at this investment business and now he is trying to convince us to buy into to a new federal “infrastructure bank” that will make off-budget grants and loans to rebuild “roads, bridges and ports and broadband lines and smart grids” with $30 billion of our money.

The bank would put “all those [unemployed] construction workers” back to work, he said. And it would provide Mr. Obama with lots of photo ops at jobsites, saying “look what I’ve done for you.”

If this sounds familiar, it was sold to us in the guise of the 2009 job stimulus bill that was supposed to put the construction industry back to work. Some short-term jobs were created but when the building projects were completed, the jobs ended. The construction industry today is in a recession.

Making Mr. Obama the investor-in-chief, deciding how and where the nation’s capital resources should be spent, hasn’t worked and isn’t going to work. Ask Japan, which has gone on a public-works spending binge though its economy has been in a slump for two decades.

Better to shift federal public-works spending decisions to the states, along with the gas tax money for highways, and let them - not remote federal bureaucrats - set their own priorities. Broaden the tax base by eliminating dozens of loopholes, then cut business and individual tax rates, and slash the capital gains tax to unlock needed, job-creating investment capital.

Let the marketplace make the investment decisions that have made America the largest and most successful economy in the world. Mr. Obama has got better things to do with his time, like trying to figure out why his job approval polls have fallen to 39 percent.

Not all national debt is the same. The total or gross national debt is the sum of the "debt held by the public" and "intragovernmental" debt. As of February 2011, the "debt held by the public" was $9.6 trillion and the "intragovernmental debt" was $4.6 trillion, for a total of $14.2 trillion.

Intragovernmental debt represents U.S. Treasury securities that are bought and held in accounts which are administered by the United States Government, and includes such accounts as the 'Federal Old Age and Survivors Insurance Trust Fund', 'Federal Employee Retirement Funds,' 'Federal Hospital Insurance Trust Fund,' and many others. The debt held by the public represents all federal securities held by institutions or individuals outside the United States Government, such as foreign nations that buy US securities, individuals who buy US securities, or banks/institutions that buy US securities. The debt held by the public represents in many ways a better measure of the amount of debt that the United States government owes to the outside world, and so let's take a look at the recent growth of this debt:

This picture shows the growth of the amount of debt held by the public from 1971 to today, with projections into the future. The source of the original graph was the Congressional Budget Office. I then went ahead and color-coded the graph to represent which political parties were in control of our national government at the time.

The conclusion that I have reached is that the party that controls Congress matters a lot more than the party that controls the Presidency in determining the amount of debt that our nation owes to the public. Under Republican Presidents, the debt went up and down by small amounts. Under Democrat Presidents, the debt decreased by a large amount and exploded by a large amount. But when you look at the party in control of Congress you see the largest changes in the amount of debt. Democrat control of Congress has been responsible for the most increases in the debt, while Republican control of Congress was responsible for the largest decreases and stability.

Based on this data, I suggest that next election you pay more attention to who you are voting for in Congress- we need to make sure that Republicans are in control of both the House and Senate by strong and sizable majorities. It is of lesser importance who controls the White House, although I would venture to guess that a Clinton Democrat is different enough than a radical Obama Democrat that in this upcoming election it does matter who is President, and it needs to be anyone other than Obama (a moderate Democrat or a Republican).

Via memeorandum, from CNSNews story March Madness: U.S. Gov't Spent More Than Eight Times Its Monthly Revenue:

The U.S. Treasury has released a final statement for the month of March that demonstrates that financial madness has gripped the federal government. During the month of March, according to the Treasury, the federal government grossed $194 billion in tax revenue and paid out $65.898 billion in tax refunds (including $62.011 to individuals and $3.887 to businesses) thus netting $128.179 billion in tax revenue for March. At the same time, the Treasury paid out a total of $1.1187 trillion. When the $65.898 billion in tax refunds is deducted from that, the Treasury paid a net of $1.0528 trillion in federal expenses for March....

....To help pay off its $1.0528 trillion in monthly bills on only $128.179 in monthly tax revenue, the Treasury turned primarily to new borrowing. During the month, according to the Treasury statement, the government sold $786.5 billion in new securities. It also drew down its cash balance from $190.6 billion at the beginning of the month to $118.1 billion at the end of the month. It also reaped $18 billion from the sale of assets in the Troubled Asset Relief Program....

Let's summarize what is happening under Democrat President Barack Obama's leadership with Democratic control of the Senate (currently blocking attempts by the brand-new Republican House):

• The federal government is not content to stay in massive debt, is not content to add to the debt at the levels that were unacceptable under Bush (except for his last year, usually under $400 billion), and the federal government is not content to simply add massive amounts of new debt simply during a time of 'crisis' or to 'stimulate' the economy- nope, they want to add ever and ever and every larger amounts of debt.
• This debt is not pretend play money- it is real money that has to come from somewhere. Last month, the federal government soaked up $785 billion in money. That $785 billion could have gone to building new factories, modernizing plants, investing in new technologies, paying off debt that consumers owe, investing in stock markets, bringing homes values back to past values, or as savings for the future. This whole crisis started because of a lack of liquidity- I'm no genius, but I fail to understand how the government soaking up larger and larger and larger amounts of money will lead to a more liquid environment for cash in the private sector.
• $785 billion is a lot of money that should be able to buy a lot of things... and yet, look at our nation. That money is just being burned away, piddled away with little to show with it. In my family budget, when times get rough, we cut out the fancy food and extra amenities and go back to the basics, and yet there is a belief that when times get rough for the government (and I would assert that historic and nation-altering debt levels are rough) it must spend more on extras and fancies and giveaways. Zero accountability with this money being spent.
• Treasuries continue to pay a yield. If the economy in the United States continues to struggle, I don't imagine many are able to buy US Treasury bonds, except the rich, so I'm guessing that most of these bonds are being bought up by non-US actors (banks and states and companies and foreigners), who will then own a piece of the United States. This will restrict and restrain our nation's ability to act according to its interests, and will mean that every month, US taxpayers will be sending taxes to DC, who will then send the foreign holders of our debt a check, which means that our taxpayers are working to provide funding to perhaps tyrannical and immoral governments.
• Democrats are responsible for this mess. On the ballot next year there are Democrats- for me, there is a Democratic President, Senator, and Congressman. I intend to hold them to account for this mismanagement of government, and I hope you do too.

Via Chron:

Diamond Offshore announced Friday that its Ocean Endeavor drilling rig will leave the Gulf of Mexico and move to Egyptian waters immediately — making it the first to abandon the United States in the wake of (Obama's) ban on deep-water drilling.

And the Ocean Endeavor's exodus probably won't be the last, according to oil industry officials and Gulf Coast leaders who warn that other companies eager to find work for the now-idled rigs are considering moving them outside the U.S.

It was unclear how many U.S. jobs could leave with the Ocean Endeavor, but typically more than 100 workers are on the rig at any given time, doing everything from drilling to cooking meals. Onshore, a network of businesses supplies the rigs with groceries, equipment, uniforms and drilling materials.
 
Dan Pickering, a financial analyst with Tudor, Pickering Holt & Co. Securities, said the legal uncertainties surrounding the ban - and the administration's plan to issue a new, revised moratorium - ensure that no companies will resume deep-water drilling in U.S. waters anytime soon.
 
"Are you really going to spend $5 million … getting ready to drill a well that someone would when probably block you from drilling?" Pickering said.

Are you going to invest money in doing something productive in America when Democrats are sitting around to talk bad about you, change the laws around, and tax that money away so that they can give it to their politically-connected friends? Are you going to work hard, knowing that Democrats can change the rules of the game whenever they want and whichever way the wind blows just so that they can pay back those who put them in office?

The answer to both of those questions is an obvious 'no', and demonstrates why Democrats shouldn't be running anything at all in our great nation. It is sad that their policies- the policies of Democrats like Pelosi, Reid, Peters, Levin, Obama, etc- have directly forced one company that employs hundreds producing a product that is high demand for a nice profit to leave our nation and go to Egypt because that country is more welcoming and accepting than ours. It is sad that these oil rigs are being forced to change their plans, and instead of making America a richer, more prosperous nation, are enriching a nation like Egypt instead.

Elections have consequences. This is what happens when you vote Democrat, anywhere on the ticket- businesses leave and our nation and society are a little bit less rich than we used to be.

Although Michigan's US House of Representatives 9th District has historically been a Republican district, in 2008 it elected a Democrat named Gary Peters. According to CQ Politics, in order to defend his seat, Peters has raised a whopping $2 million in receipts through the first quarter of 2010, which is considerably more than any of his GOP challengers (Raczkowski, Welday, Goodman).

People give money to candidates for two main reasons. One reason that people, businesses, and organizations give money to candidates because they believe in the candidate personally or support their policies. The second major reason that people, businesses, and organizations give money to candidates is because they feel that by giving the candidate money it buys them access to power or control over the candidate.

Although Gary Peters is one of the few elected officials who refused to take the Project Vote Smart Political Courage test (a test where a candidate makes known where they stand on important issues), and he has sponsored very little legislation in Congress, and has refused to meet with constituents or hold town halls, we do know some things about his positions on the issues.

As I discussed in my post Gary Peters Scores a 90% On the Pelsoi Index- A Vote by Vote Analysis of Peters Liberal Record in Congress, Peters has voted in favor of the stimulus bill, cap and tax, Obamacare, bloated budget bills, increased taxes, and raising the debt ceiling. He voted against Stupak's Anti-Abortion Amendment. With this information, we can now begin to look at who is supporting Peters in the 2010 election and think about what sort of policies they might be supporting or what sort of influence over the Congressman they might be buying.

According to OpenSecrets.org, the top industries that have currently donated to Michigan Democratic Congressman Gary Peters to support his re-election bid are (in order): Lawyers/Law Firms, Democratic/Liberal Groups, Industrial Unions, Real Estate Firms, Health Professionals, Building Trade Unions, Insurance Companies, Securities and Investment firms, Retired People, Public Sector Unions, Hospitals/Nursing Homes, Transportation Unions, Finance Companies, Lobbyists, Automotive Companies, Commercial Banks, and Finance/Credit Companies.

You make your own decisions, but my rough take on that is that Peters has consistently voted to support 'too big to fail' in a range of industries, and is getting paid back for that. Peters has voted to support government/industry/union partnerships in banking, healthcare, and automotive industries, throwing billions of dollars at the big politically connected firms to bail them out and protect them from competition from smaller, less connected companies.

That's wrong- Peters has got to go.

It has been a struggle for me to write about the financial reform bill, and I haven't commented before on it yet. But yesterday I came across an excellent article in the Washington Independent called A Guide to the Tangled Financial Reform Bill which breaks down each important provision of the proposed financial reform bill and attempts to give a balanced analysis of it. I urge you all to read this article before making any further thoughts or opinions on the bill- whether you are Republican or Democrat, liberal or conservative, it is important to look at the world around you with good information and analysis, which this article provides.

Here are the best pieces (edited and shortened by me) of the article A Guide to the Tangled Financial Reform Bill:

Audit the Fed. The Federal Reserve’s balance sheet is more than double its size before the financial crisis — swollen with $1.1 trillion in mortgage-backed securities purchased from Fannie Mae and Freddie Mac plus toxic assets from failed companies like Bear Sterns — and a bipartisan group of senators want to force a thorough independent audit of the Fed’s books. A strong provision did not make it into the final Senate legislation.

End too big to fail by capping bank size. Dodd’s bill as currently written gives the Federal Reserve and other regulators the ability to seize and break up financial firms it deems systemically important and systemically dangerous. But that is meant only as a “last resort,” and members of both parties consider the language too wan. Sen. Sherrod Brown (D-Ohio) and Sen. Ted Kaufman (D-Del.) last week introduced the Safe Banking Act, which they plan to offer as an amendment to the Dodd bill. It mandates hard leverage and size caps on banks and other financial firms; limits commercial banks’ assets to 2 percent of GDP and non-banks’ assets to 3 percent; and imposes a 16-to-1 leverage cap, among other provisions.

Reinstitute Glass-Steagall provisions. Another popular way to effectively limit bank size is to return to the Depression-era Glass-Steagall rules. The Glass-Steagall Act, mostly repealed in 1999, prevented banks from having both commercial and investment banking arms — as, for instance, J.P. Morgan Chase does today. Sen. Maria Cantwell (D-Wash.) and Sen. John McCain (R-Ariz.) plan to introduce an amendment reintroducing the rule and thus requiring big, diversified banks to split themselves up. Shelby, Sen. Johnny Isakson (R-Ga.) and Sen. John Cornyn (Texas) also support the measure.

An effectively similar, if functionally different, way of breaking up banks or limiting their size is by instituting the Volcker Rule — which bars banks from speculating with their own money by “prop trading” or investing in hedge funds. The current Dodd bill promises to institute something like the Volcker Rule, creating a commission to look at how to institute it down the road. But Sen. Jeff Merkley (D-Ore.) and Sen. Carl Levin (D-Mich.) have ready a measure introducing a more-stringent version immediately.

Fix the ratings agencies. The Dodd bill does little to fix the credit ratings agencies, whose profligate stamping of AAA ratings on collapsing subprime mortgage-backed securities helped to stoke the crisis. (The companies have a conflict of interest at the core of their business, in that they are paid by the companies whose securities they rate.) The Dodd bill creates a new office at the Securities and Exchange Commission to look closely at credit ratings agencies — but does little more to further reform them. Numerous Democratic senators have cited the issue as a major weakness in the bill, and Senate staffers say it is unlikely to go unchanged. Sanders has said he will introduce new language to strengthen oversight over and regulation of the agencies.

Guarantee no taxpayer money will go to bank bailouts. Republicans have derided the Dodd bill’s resolution authority fund — wherein the government will tax $50 billion from the banks, creating a pool of cash to be used by the Federal Reserve to shut down failing firms — as creating “permanent bailouts.” GOP politicians including Sen. Mitch McConnell (R-Ky.) have cited it as a major point of contention. But Senate staffers say that rather than killing the resolution-authority fund, Republicans want language explicitly guaranteeing taxpayers will not be on the hook for future bailouts.

Keep the Fed the regulator of little banks. Under the Dodd bill, the Federal Reserve would have oversight only of banks with more than $50 billion in assets. But Sen. Kay Bailey Hutchison (R-Texas) and Sen. Richard Shelby (R-Ala.) oppose this measure and want the Fed to have oversight of small banks as well — ensuring that the Fed does not become overly concerned with the business of big banks and ensuring that it keeps an eye on the small financial companies that can be the bellwether of bad economic times. Hutchison has said she plans to “certainly have an amendment that assures that state banks and community banks will be able to have access to be members of the Federal Reserve.”

Make the Consumer Financial Protection Agency truly independent. Sen. Jack Reed (D-R.I.) has promised to introduce amendment moving the Consumer Financial Protection Agency outside of the Fed.

Improve hedge fund reporting. Reed also plans to introduce an amendment closing a loophole in the Dodd bill that might let some private equity firms, venture capital firms, and hedge funds avoid registering with the Securities and Exchange Commission.

This is a reminder that whatever the original bill that the Democrats brought to the floor, what matters is the bill that is passed at the end (and I don't mean by 'the end' when it passes the House and Senate and is signed by the President- now that Democrats run things in DC, that outdated model of passing legislation isn't followed and instead they deem things passed and then our dear leader runs things, and that is what I men by 'the end').

In a vote analysis conducted by The Washington Post, liberal Gary Peters was found to have voted with his party and with liberal Nancy Pelosi over 96% of the time over the last 11 months.

That puts Peters in the same company with New York's ethically-challenged Charlie Rangel, California's "Big Three Killer" Henry Waxman, and Massachusetts' Barney Frank (who precipitated the mortgage-back securities meltdown).

How does he compare to all Democratic members in the House? Gary is MORE PARTISAN than the average Democratic members and MORE PARTISAN than average Republican member.

Who else is Peters more partisan than? Ironically enough, though he campaigned as an independent, moderate, pro-business fiscally conservative Democrat, Gary Peters has proven to be MORE PARTISAN than former Congressman Joe Knollenberg, whom Peters lambasted for supposedly voting in lock step with his party and with President George Bush.

According to The Washington Post, in his last term in Congress, Rep. Joe Knollenberg's voting record was SIGNIFICANTLY LESS PARTISAN than Gary Peters.' What's more, Knollenberg was less partisan than Peters over the course of his entire eight terms in Congress.

Peters' intensely liberal, partisan voting record isn't surprising given the fact that he was recruited, bought and paid for by the Democratic Congressional Campaign Committee, liberal environmentalist groups, and Big Union dollars.

This year, Peters has accepted nearly HALF A MILLION DOLLARS in special interest campaign contributions from LOBBYISTS and POLITICAL ACTION COMMITTEES. That’s money from unions, from trial lawyers, from health care lobbyists and from Wall Street. Peters is NOT an independent voice; he’s bought and paid for by his liberal special interest cronies. His voting record shows it.

For the record, I didn't support Peters but wasn't that enthusiastic about Knollenberg, but am very excited about Rocky Raczkowski, who hopefully will be the Republican nominee that challenges Peters in the 9th District. He is a solid conservative and a recent war veteran, and would be a much better legislator for Michigan's 9th than Peters has proven to be.

Hat tip to Michgan's 9th.

Emmanuel Ashong-Katai of Ghana's SEC writes:

...the unlisted securities market holds much promise for the private sector and the growth of the national economy. Its effective and efficient development will unleash the creative potential of the Ghanaian private sector by turning ideas and inventions into marketable products both locally and internationally. It will also induce efficiencies in the entire financial system - It will force commercial banks to improve their services and reduce their lending rates to the SME sector as the unlisted market provides them with an alternative and reliable source of long- term capital.

More here(PDF)
Read related article 'New securities market to rescue SMEs'
via PEF Ghana

The headlines today are shocking- our should be shocking to a country raised on freedom and liberty- a President, one person, acting as a tyrant, is forcing a major business- one of the biggest privately held companies in the world- to fire their CEO in order to gain more power and control over this company. What happened to America?

I'm too stunned, shocked, and saddened to write more, although read these editorials if you want to read some good analysis- the story Obama forces Wagoner out at GM which talks about the situation, this editorial Rick Wagoner's ousting had more to do with politics than his ability to revive GM which provides interesting perspective, and this one by Daniel Howes about Wagoner takes the fall for GM.

By the way, inspired by a comment in General Motors Situation Boils Over, I am going to try to call GM Federal Motors to convey the sense that our government is now the true master of this corporation.

UPDATE: Daniel Howes had a great column in today's Detroit News. Link to it here. Here are some of the better parts of it:

But what the president didn't say Monday, as he detailed his administration's prescription for Detroit's two sickest automakers, is what he actually did -- oust a sitting CEO, GM's Rick Wagoner, and begin the process of remaking a board of directors...

In one swift act, the president effectively overruled the oversight and fiduciary responsibilities of GM's directors, duly elected by the automaker's shareholders, because he could -- and the federal government, officially a lender of $13.4 billion to GM, doesn't own a single share of the automaker.

A chilling message?

"Firing a CEO is usually what a board does," says Peter Henning, a law professor at Wayne State University who worked in the enforcement division of the Securities and Exchange Commission. "We now have a CEO-in-chief ... overseeing large sectors of the economy. We are certainly in a brave new world."

And it looks like this: the federal government, in a bid to "save" companies determined crucial to the economy, is prepared to use whatever thin financial connections it has to them to broom management, void employment contracts, reload boards of directors and, if necessary, force bankruptcies.

The issue is principle and the lengthening arm of government into commerce. How can corporate governance and the fiduciary responsibility of directors to shareholders be so easily usurped to satisfy the political exigencies of the day? Stunning is too mild a word to describe the precedent set here.

Odhiambo Ocholla of Suntra Investment Bank writes:

Kenya desperately needs development capital, and current inflows from remittances are fast becoming a source of financial resources.I propose that a Diaspora Development Bond be introduced with appropriate incentives to attract investment from our nationals in the Diaspora.Such a bond can be structured in such way that it does not compete with traditional remittances, as this would be an investment vehicle.
Diaspora development bonds are typically long-dated securities, which a country has to redeem only upon maturity. Thus, Diaspora bonds are a source of foreign financing that is long-term in nature.The Diaspora purchases of bonds issued by their country of origin are likely to be driven by a sense of patriotism and the desire to contribute to the development of the home country...[continue reading]

Okay, so driving home I caught most of Bush's address to the nation about the proposed $700 billion bailout package for millionaire fat cats on Wall Street. Since it was a national address, my students probably will be talking about it tomorrow, so that means I need to have it addressed in my class too. Here is how I'm going to approach it.

In my government classes we just finished talking about the Constitution, and how it was built on several principles. One of these was limited government- in fact, our founding fathers believed very strongly in a limited government- that is a government that can only do those things which are written in the Constitution. Here is the question I am going to pose to my students tomorrow:

Where in the Constitution does the federal government have the power to speculate on financial markets by buying and selling ultra-risky mortgage backed securities? Which clause in the Constitution might be the basis for this power? Is this action something our founding fathers would have approved of?

By now, my students have already memorized the lesson that a government that has the power to do anything for you can do anything to you. Even high school students recognize that this bailout is not right. The $700 billion dollar bill will be shoved through Congress with very few people looking at it- imagine how much corruption will come pouring out of this. The same politically connected individuals that caused this mess are now going to having billions thrown at them. That's not fair.

Bush is not a conservative. Prescription drug coverage, massive expansion of the Departments of Education and Homeland Security, and now a revolutionary bailout- this is the best example of an unchecked, lame-duck second term President doing whatever he wants to do, now unconnected with reality, ideology, or party. Scary stuff.

UPDATE: This is really good article by David Warren- he's Canadian, but seems to understand what made America great once and what we have lost now. It's good- check it out.

"...The African Securities Exchanges Association (ASEA) is aiming for systematic mutual cooperation, exchange of information, materials and persons together with joint programs between its African members...it provides a forum for mutual communication, exchange of information, cooperation and technological assistance among its members, to facilitate the process of financial integration within the region for the effective mobilization of capital to accelerate economic development of Africa..."

Stock Market Nigeria reports on the guidelines for Nigeria Stock Exchange's 3rd Tier market for SME's:

The primary purpose for the setting up of the sub-sector is to encourage them to become quoted, have access to more capital and hence boost production activities in the country and beyond. Before now, the exchange consists only of the first-tier securities and the emerging market otherwise known as the second-tier securities market.

Frank Gyamfi-Yeboah &Nicholas Addai Boamah write about strengthening the mortgage market:

The main aim of a housing finance system is to provide funds to the producers and purchasers of housing both rental and owner-occupied. This simple description has spawned a broad array of institutional arrangements, ranging from contractual savings scheme, to depository institutions specializing in mortgage finance, to the issuance, sale and trading of mortgage securities. All of these arrangements have been created with the same purpose in mind, to channel funds from savers to borrowers. As economies develop, provision of housing finance often moves away from extensive reliance on special circuits towards integration of housing finance into broader financial markets. As populations continue to grow and urbanization accelerates, the necessity of providing adequate housing also mounts.

via GhanaWeb

Culled from the Financial Standard ,Nigeria Properties Online reports:

Property securitisation entails the raising of funds from the capital market for housing development, using the house to be developed as collateral security for the capital so raised. In other words, the houses to be developed serve as asset-backed securities (ABS) to which investors subscribe in the capital market. The investors are subsequently paid their 'dividend' when the houses are completed and sold by estate developers. In some types of property securitisation, the investors get annual dividends if the houses so developed are rented and the tenants pay annual rents...Through property securitisation, investors can trade shares held in properties built with their funds. This in effect means that an investor who wants immediate cash could sell off his shares in a securitised property. Property securitisation makes cheap and easy funding available for the housing sector.
This is because, through the capital market, individual investors could pool their resources together for development of property which would be sold or rented at market rates.
The scheme, if properly managed, could provide a positive turning point in housing development in Nigeria. It could lift the burden of housing finance off the government and private developers. Investors will now do it as a worthwhile venture, and housing development would no longer be seen as a social service which the government must shoulder. This implies that housing development would experience exponential growth, and the growing need for accommodation by teeming Nigerians would be assuaged.

Stuart R. Cohn wrote "...In most sub-Saharan countries there is so little history of successful investing in domestic enterprises, of capital raising through public offerings, and of stock market activity, that the mere inauguration of stock exchanges and the listing of former parastatals is far from sufficient to assure an active and growing stock market. Steps must be taken outside of the normal course of market development, beyond merely adding to the list of securities by new privatisations or the floating of government bonds. What is required is a change in how the government views the stock exchange as well as a commitment to capital growth..."