Mr. Geithner is quoted as saying, “Some on the left have fallen into a trap set by the Republicans, allowing voters to mistakenly think that the biggest part of the bank bailout had come under Obama rather Bush.” Mr. Geithner should know – as he spearheaded the saving of banks and other financial institutions under both Bush and Obama. In fact, it’s the continuation of George Bush’s policies by other means that really has erstwhile Obama supporters upset.

Geithner also suggests that his critics compare government spending on different kinds of programs under President Obama: “By any measure, the Main Street stuff dwarfs the Wall Street stuff.” This insults our intelligence. Wall Street created a massive crisis and we consequently lost 8 million jobs; any responsible government would have tried hard to offset this level of damage with all available means. This includes fiscal measures that will end up increasing out privately held government debt, as a percent of GDP, by around 40 percentage points. It’s not the fiscal stimulus, broadly defined, that is Mr. Geithner’s problem – it’s the lack of accountability for the bankers and politicians who got us into this mess.

and, most notably:

“we saved the economy but kind of lost the public doing it” No, Tim. They Saved the Big Banks But Kind Of Lost The Economy Doing It.

(Read more from baselinescenario.com)

Toyota’s global president has said he will testify to US politicians next week about the carmaker’s giant global recall programme.

Akio Toyoda said he was looking “forward to speaking directly with Congress and the American people”.

He had previously indicated he would not travel to Washington, instead wishing to lead the recall from Japan.

Mr Toyoda is now due to appear before a congressional committee on Wednesday of next week. (Read more from news.bbc.co.uk)

Now that our government is running GM (Government Motors), it’s hard to take bullying of their competitors seriously — the conflict of interest is horrendous.

Sarah Palin has been using her political action committee to buy up thousands of copies of her book, “Going Rogue,” in order to mail copies of the memoir to her donors, newly filed campaign records show.
Alaska governor’s decision to step down has many people puzzled.

The former Alaska governor and 2008 Republican vice presidential candidate had her political organization spend more than $63,000 on what her reports describe as “books for fundraising donor fulfillment.” The payments went to Harper Collins, her publisher, and in some instances to HSP Direct, a Virginia-based direct mail fundraising firm that serves a number of well-known conservative politicians and pundits. (Read more from abcnews.go.com)

Leviathan government requires companies to be politically connected if they want to succeed.

From businessinsider.com.

Jan. 29 (Bloomberg) — The idea of secret banking cabals that control the country and global economy are a given among conspiracy theorists who stockpile ammo, bottled water and peanut butter. After this week’s congressional hearing into the bailout of American International Group Inc., you have to wonder if those folks are crazy after all.

Wednesday’s hearing described a secretive group deploying billions of dollars to favored banks, operating with little oversight by the public or elected officials.

We’re talking about the Federal Reserve Bank of New York, whose role as the most influential part of the federal-reserve system — apart from the matter of AIG’s bailout — deserves further congressional scrutiny.

The New York Fed is in the hot seat for its decision in November 2008 to buy out, for about $30 billion, insurance contracts AIG sold on toxic debt securities to banks, including Goldman Sachs Group Inc., Merrill Lynch & Co., Societe Generale and Deutsche Bank AG, among others. That decision, critics say, amounted to a back-door bailout for the banks, which received 100 cents on the dollar for contracts that would have been worth far less had AIG been allowed to fail. (Read more from bloomberg.com)

Geithner addressed the campaign against too-big-to-fail banks during a recent interview with Politico. While Geithner said he understood the anger against bailed out banks and said that it was fair for bank customers to expect more, he did not explain why he thought that it was a bad idea.

Move Your Money is a project that seeks financial reform from the ground up. Account holders with money at bailed-out banks are encouraged to withdraw their money and deposit it into smaller, better-managed community banks and credit unions.

. . . .

Geithner’s comments about Move Your Money begin at 3:35.

This guy’s analysis is so wrong, and so insidious — blaming all the problems on liberty.

To learn more about the Move Your Money campaign, visit MoveYourMoney.info.

These are the REGULATORS which so many of my liberal friends consider guardians and saviors.

Again, and again and all day long — regulation does not protect the public from business. It protects business from the public.

The government shouldn’t reward liars. But that’s the effect of changes to the Obama administration’s failing program to help homeowners modify their mortgages.

Until recently the rules were clear: if you grossly understated your income to qualify for the program, you had to restart the loan modification process. It made sense. After all, we got into this housing mess partly because too many people were dishonest about how much they made.

Fast forward to today. The federally funded Home Affordable Modification Program was aimed at getting banks to rework mortgages for homeowners in order to slow the pace of foreclosures. The government set a goal of modifying up to 4 million mortgages over the next three years.

The program isn’t working like it’s supposed to. Since March, just 31,000 homeowners have won permanent relief. One big reason why is that lenders are doing what they should have been doing all along — requiring things like proof of income.

How’s the government responding? By letting homeowners who fudge their income numbers off the hook with little more than a wink and a nod. (Read more from news.yahoo.com)

Rewarding irresponsible people is horrible economics, not to mention morality, but in D.C., political expediency rules all else.

Michael Chertoff, Former Department of Homeland Security, is the head of the Chertoff Group, the lead cheerleader for what is being called the Full Body Scanner Lobby, reports the Washington Post and the Washington Examiner.

Ever since the Christmas Day Bomb Scare, Chertoff has been making the rounds championing the Full Body Scanners as a way to detect hidden explosive devices.

Here is a Chertoff quote from the New York Times on December 29th.“If they’d been deployed, this would pick up this kind of device,” Michael Chertoff, the former homeland security secretary, said in an interview, referring to the packet of chemicals hidden in the underwear of the Nigerian man who federal officials say tried to blow up the Northwest Airlines flight.

A few days later the Washington Post revealed that Chertoff represents Rapiscan – a maker of full body scanners drawing criticism of groups who oppose full body scanners (Read more from nowpublic.com)

The crooks have been in charge for a long time.

The Tax Prof[essor] Blog is one of a collection of blogs by law professors. I love the way Tax Prof Blog exposes the shamelessness with which the tax code is abused to favor the privileged, and the incompetence of our vast government bureaucracies.

Two recent posts:

IRS Cannot Verify Taxpayer Eligibility for 2/3 of $325 Billion of Stimulus Tax Benefits
The Treasury Inspector General for Tax Administration today released Evaluation of the Internal Revenue Service’s Capability to Ensure Proper Use of Recovery Act Funds (2010-41-011):

The Treasury Inspector General for Tax Administration today publicly released its review of the IRS’s ability to verify taxpayer eligibility for tax benefits and credits provided by the American Recovery and Reinvestment Act of 2009.

The Recovery Act contains 56 tax provisions with a potential cost of more than $325 billion that are intended to provide tax relief for individuals and businesses. These include 20 provisions for individuals that provide tax relief to working or retired Americans and their families. Thirty-six additional provisions provide tax relief and incentives for businesses, including provisions that encourage investment in sources of renewable energy and promote the hiring of unemployed veterans. They also allow for the sale of bonds to provide for construction, financing, environmental and manufacturing improvements.

TIGTA found that the IRS is unable to verify taxpayer eligibility for the majority of Recovery Act tax benefits and credits at the time a tax return is processed.

My thoughts: This is further evidence that government “help,” doesn’t. In pandering for support, our overlords have created an unwieldy bureaucracy that mostly helps only the privilege people who have the time, money and power to navigate it. It also keeps armies of tax lawyers and consultants employed in what Bastiat called rent-seeking, and rent-avoidance. If the gargantuan tax code was thrown into the garbage can, more people would employ their talents in the production of goods and services that society actually wants. Instead, time, talent, capital, creative energy is employed in fighting and manipulating the forceful hand of government.

Over 275,000 Federal Workers Are Tax Deadbeats

Over 276,000 federal workers and retirees owed more than $3 billion in back income taxes in 2008 (up from $2.7 billion owed in 2007).

The cabinet departments with the largest percentages of employee/retiree tax deadbeats are:

1. Housing & Urban Development: 4.05%
2. Veterans Affairs: 3.91%
3. Health & Human Services: 3.86%
4. Army: 3.76%
5. Education: 3.60%
6. Air Force: 3.25%
7. Defense: 3.16%
8. State: 3.14%
9. Navy: 3.01%
10. Commerce: 3.00%

The agencies and commissions with the largest percentages of employee/retiree tax deadbeats are:

1. National Capital Planning Commission: 10.42%
2. Advisory Council on Historic preservation: 9.26%
3. U.S. Office of Special Counsel: 8.65%
4. U.S. Election Assistance Commission: 8.51%
5. Federal Labor Relations Authority: 7.20%
6. U.S. Commission on Civil Rights: 7.14%
7. Federal Mine Safety & Health Review Commission: 6.82%
8. Government Printing Office: 6.29%
9. Federal Retirement Thrift Investment Board: 5.33%
10. Court Services & Offender Supervisors: 5.23%

Other departments and agencies:

* Federal Reserve Board: 4.32%
* U.S. House of Representatives: 4.17%
* U.S. Senate: 3.19%
* SEC: 2.56%
* U.S. Tax Court: 1.43%
* Treasury Department: 0.98% (the lowest delinquency rate among cabinet departments)

My thoughts: I wonder how these rates compare to national average for the 5/6th of us who don’t work for government. There is a class struggle, but it isn’t between laborers and owners of capital, it is between government workers and those of us who produce goods and services that society voluntarily consumes.

The wider public might view investment bankers as ‘vampire squid’, as one commentator put it, but the newspaper of the business world has made him its ‘person of the year’

. . . .

In the parallel universe inhabited by the FT, Blankfein is a hero – a “master of risk”. The FT accepts that Blankfein has struggled to find an effective rebuttal of a deluge of public criticism unleashed on his bank.

But it says the former gold trader from the Bronx has “steered Goldman adeptly through the crisis, betting correctly that the global investment banks would survive the turmoil (with government help) and not be dismantled by regulators”.

The FT’s John Gapper continues: “The bank has stuck to its strengths, unashamedly taking advantage of the low interest rates and diminished competition resulting from the crisis to make big trading profits.”

How charitable. This is the bank that intends to distribute about $22bn in remuneration to its employees this year – more than $700,000 each – at the height of the worst recession since the war. Money, of course, partly earned through government support of the US banking sector paid for with taxpayers’ funds. (Read more from guardian.co.uk)

See Also:

Goldman Head on report White House visitors

Banks whose executives served on Federal Reserve boards were more likely to receive government bailout funds from the Troubled Asset Relief Program, according to the study from Ran Duchin and Denis Sosyura, professors at the University of Michigan’s Ross School of Business.

Banks with headquarters in the district of a U.S. House of Representatives member who serves on a committee or subcommittee relating to TARP also received more funds.

Political influence was most helpful for poorly performing banks, the study found. (Read more from reuters.com)

There are over 34,000 registered lobbyists in Washington D.C. Movements to restrict the actions of lobbyists are very popular, but they are treating the symptom (not to mention possibly violating the 1st Amendment), not the disease. When every aspect of American life and prosperity is dictated by Washington D.C. people MUST lobby — it’s the only way we can get some of our money back. Even businesses who have no interest in gaining an unfair advantage through the forceful hand of government must lobby or be plundered.

“The more numerous the laws, the more corrupt the government.” ~Tacitus (ca. 56–ca. 117)

Isn’t this special!

In the first six months of 2010, about 6,000 employees of Goldman Sachs Group Inc. will take a break from their spreadsheets and move across the southern tip of Manhattan to a new 43-story, steel-and-glass skyscraper.

The building was a bargain — and not just because the final cost is expected to be $200 million less than the $2.3 billion price the company had estimated when construction began in November 2005. Goldman Sachs also benefited from the government’s determination to avoid losing jobs in lower Manhattan after the Sept. 11, 2001, terrorist attacks.

Building a new headquarters cater-cornered to where the World Trade Center once stood qualified the firm to sell $1 billion of tax-free Liberty Bonds and get about $49 million of job-grant funds, tax exemptions and energy discounts. Henry Paulson, then Goldman Sachs’s chief executive officer, threatened to abandon the project after delays in addressing his concerns about safety. To keep the plan on track, state and city officials raised the bond ceiling to $1.65 billion and added $66 million in benefits.

. . . .

Goldman Sachs, which set a Wall Street profit record of $11.6 billion in 2007 and may have earned $11.4 billion this year, according to the average estimate of 15 analysts surveyed by Bloomberg, won new and larger concessions from taxpayers in 2008. This time it was the threat of a financial meltdown that prompted the U.S. government, with Paulson as Treasury secretary, and the Federal Reserve to supply an unprecedented amount of aid to firms deemed critical to the financial system, including Goldman Sachs.

The 140-year-old company received $10 billion in capital, guarantees on about $30 billion of debt and the ability to borrow cheaply from the Fed. The Fed’s bailout of American International Group Inc., and its decision to pay the insurer’s counterparties in full, funneled an additional $12.9 billion to Goldman Sachs. (Read more from bloomberg.com)

EDINBURGH — The expenses racked up by U.S. lawmakers traveling here for a conference last month included one for the “control room.”

Besides rooms for sleeping, the 12 members of the House of Representatives rented their hotel’s fireplace-equipped presidential suite and two adjacent rooms. The hotel cleared out the beds and in their place set up a bar, a snack room and office space. The three extra rooms — stocked with liquor, Coors beer, chips and salsa, sandwiches, Mrs. Fields cookies and York Peppermint Patties — cost a total of about $1,500 a night. They were rented for five nights.

While in Scotland, the House members toured historic buildings. Some shopped for Scotch whisky and visited the hotel spa. They capped the trip with a dinner at one of the region’s finest restaurants, paid for by the legislators, who got $118 daily stipends for meals and incidentals.

Eleven of the 12 legislators then left the five-day conference two days early.

. . . .

Ever since a corruption scandal in 2005 led to restrictions on privately funded travel, legislators have been taking more trips paid for by the government.

The cost they reported for such travel abroad was $13 million in 2008, a 70% jump from 2005, according to a Wall Street Journal analysis of travel records. Lawmakers don’t have to report the cost of domestic travel when the government pays. The $13 million didn’t include the expense of flying on Air Force planes, which lawmakers don’t have to disclose.

Over the 2005-08 period, the cost of legislators’ privately funded travel, both domestic and overseas, fell 70%, to $2.9 million, according to LegiStorm.com, a Web site that tracks it.

Lawmakers must reveal only general information about the travel, such as countries visited. Several weeks after a trip, they report the overall cost, without a detailed breakdown. This account of congressional travel is based on trip itineraries provided by lawmakers, meeting schedules and what two Journal reporters saw. Mr. Tanner’s office and other lawmakers confirmed many details of the account and didn’t dispute the others.

The blending of business and pleasure on the trip to Scotland was typical, aides and lawmakers say. In August, two Republican senators, Richard Shelby of Alabama and John Cornyn of Texas, went to Europe with their wives and aides to meet with banking regulators and industry executives. Military officials picked up Mr. Shelby’s luggage at his office. A separate government car drove him and his wife to the airport. “That is typically how the military handles departures on congressional delegations,” said a spokesman for the senator. (Read more from online.wsj.com)

Isn’t that special!