An Unheeded Stimulus Warning And Ignored Financial Lessons

I ran across this article via HotAir.com.  I would suggest reading the entire article (a news release, really).  Interestingly, the release, entitled “FDR’s policies prolonged Depression by 7 years, UCLA economists calculate“, is from 2004 (long before “stimulus” became a hot political topic).  Here’s my favorite quote, however:

“Why the Great Depression lasted so long has always been a great mystery, and because we never really knew the reason, we have always worried whether we would have another 10- to 15-year economic slump,” said Ohanian, vice chair of UCLA’s Department of Economics. “We found that a relapse isn’t likely unless lawmakers gum up a recovery with ill-conceived stimulus policies.”

I also find it interesting that everyone is having a coniption about the AIG bonus money.  The architects (Barney Frank and Chris Dodd) of the financial crisis threw money at them, one of which (Senator Dodd) made sure their bonuses were protected by law (especially since they are one of his big contributors).  We were told, at the time, that the whole point of the money was to keep the ‘lucky’ institutions from bankruptcy.  By so doing, contracts must, by law, be honored – which would not be the case in bankruptcy.  Ed Morrisey sums this up well – I highly recommend reading his post, especially, his concluding statement:

In the future, we can avoid having taxpayer dollars go to Wall Street bonuses by not bailing out private companies with taxpayer dollars.

Ultimately, AIG is a distraction from the true culprits of this mess.  We would be better served by getting rid of those who instigated this and those who supported the poorly enacted bailout and stimulus packages.

So far, however, everyone is focused on AIG while it is clear we haven’t learned our lesson and are pushing to repeat the same lending mistakes.

UPDATE: The Fed, and Treasury knew about the bonuses since December.  Merry Christmas!

UPDATE 2: Michelle Malkin also chimes in and provides more details on Dodd’s amendment with a very appropriately titled piece: The Kabuki Theater of AIG Outrage

Kabuki theater, indeed: Obama, Congress knew about AIG bonuses for months

FINAL UPDATE: The “hits keep on coming”.  Freddy Mac has a nice bonus plan too.  Go to HotAir for further information/updates on this issue.

Advertisements

Stimulating Pork: The Stimulus Package And TARP II Warning (Update)(Update: House Vote)

The massive bill, now hovering around $900 Billion, appears hard to grasp in terms of how much pork is in the bill.  Those attempting to dig into the bill are finding the massive amounts of waste and pork within the bill.  However, I was unable to find a comprehensive list of all the pork as everyone continues to find more in it.  The Wall Street Journal has a very good article on the waste and list of pork but misses a couple of projects (they, likely, were not aware of them, at the time – such as $75 million for smoking cessation).  The WSJ also notes that only 12 cents on every dollar is spent on anything that can, arguably, be considered stimulus.  That means that 88 cents/dollar (or 88%) of the bill is waste.

I was going to try to compile a list of all the waste, thus far, but with the continuing stream of “new finds” it would be rapidly obsolete.   As such, go to the above linked Wall Street Journal Article – it provides a good, baseline list.  Then, go to Michelle Malkin and Hot Air as they are doing a good job of reporting on the waste, check their sites frequently for updates.

Finally, be sure to contact your Respresantative and Senators – politely ask them to oppose this bill.  Be sure to watch your local officials, many are happily jumping on the pork bandwagon, including Davis County officials.

Now the warning.  Remember TARP (the $700 Billion bank bailout)?  There is talk about a separate TARP II.  I first heard about it via an Allahpundit post on January 20th.  The information is being confirmed.  Better fight now and fight hard.

UPDATE: The Heritage Foundation also has some information here, here, and hereThe Swine Line has more on the pork (which includes $1 Billion for ACORN).  It is also no wonder that the NEA and UEA support the bill – both would benefit from around $142 Billion expansion of the Dept. Of Education.  That, too, would stick with the aforementioned 12 cent formula, producing hardly any arguable economic stimulus.  Apparantly, it’s ok to strap the kids in the educational system with massive, new debt.  And don’t forget the $335 million in STD prevention.  Good luck keeping up with the waste in the bill…

UPDATE:  The bill has passed the House (244-188).  However, as surprising as this may be, not a single Republican  voted for it and 11 Democrats voted with the Republicans (ie a bipartisan vote against the bill!).  In terms of Utah’s Representatives, Bishop and Chaffetz voted No while, unfortunatley, Matheson votes Yes on “porkulus”.  Click here for the House vote list.  Now it is on to the Senate…will Hatch and Bennett find their spines or cave?  Plan on calling their offices tomorrow.   While you’re at it, if your Representative voted no, call and thank them.

UPDATE: Go to Key Senators To Call On The Stimulus (Updated Pork List) for the most up-to-date pork list (note, however, that, too, isn’t comprehensive).