The Bailout

I am certain that I am going to step on some toes with this post. But there are times when toes must be stepped on. There are times when silent protest just isn’t enough to get the message across. There are times when we must speak up to those who are wrong and try to make them see the light.

Benjamin Franklin once said, “When people find they can vote themselves money, this will herald the end of the republic.” He had foresight to realize the potential of what the American public is now doing. Our leaders have voted massive amounts of money, money that must be borrowed, to bail out businesses that have followed lavish and unsound business practices. We, the People, were told that if these bailouts were not approved then the economy would tank. The bailouts were approved. And the economy continues its rapid decline. And, in part, some of the businesses are continuing the same lavish and unsound business practices that created their problems in the first place.

AIG, for example, has received billions in bailout money. But, they have been caught throwing lavish parties, golfing trips, and hunting trips for their top employees – on our money, after the bailout. Their excuse is that training seminars are needed in order to conduct business. That may be true. But training seminars can be held in corporate meeting rooms rather than five star resorts. And, they don’t have to include golfing and hunting or any other such activity. In fact, seminars can be held long distance with computer technology and web cams. AIG has been wasting OUR money. Others have been as well.

The $700 billion bailout has been approved. But there are no restraints on how the money is to be spent. It was approved on the basis of the Government taking on the bad loans that bank are holding due to the real estate decline. But, now it is said that this is not going to happen. We, the People have been lied to. Those in charge have the access to this huge piggy bank with no supervision. And, they have the right to ask for more. In fact, this has already happened. We, the People have been told about the $700 billion. But, the AIG funding is outside the $700 billion. And, what else have they done? It seems that We, the People are not given the right to know how OUR money is spent.

Now, the auto industry needs a hand. GM claims to be on the verge of bankruptcy. They say that it is just a matter of months before they fold. Ford and Chrysler are not far behind. Well, look at the way they conduct business. They continue to create cars that are not of the same standard as the foreign competition. Toyota, use they make them here but the profits go overseas, makes a better car than Ford, GM and Chrysler do. We have, and have had for a long time, the ability to make the same quality. But, they have not. Also, the big three have continued to make big, powerful cars of the 1970’s style, when more people have wanted the more efficient models. I am not advocating just making the little cracker box cars. But, to ignore the trends of the marketplace is a sure way for a business to fail. And, should We, the People have to pay for companies that do not pay attention to the marketplace? Should We, the People have to pay for the lavish contracts that have been offered to the workers of these companies? I say no, not with no restraints. These companies must be responsible for their actions. And, if they are allowed to go under, it will be a blow to the economy. But, if they are allowed to continue the way they are, it also will be a blow to the economy.

Corporate welfare, and this is what the bailout is, just does not work. Corporate welfare encourages the same bad behavior that got them into trouble in the first place. Corporate welfare eliminates fair competition. Companies who don’t get the bailout may be tempted to follow the bad practices as those who do get the bailout – just to get the bailout themselves. Corporate welfare is a waste of our money. Letting business with bad business fail, and allowing businesses with good business practices succeed is the American way. This is what has made America great. And returning to this practice is what it will take to return America to greatness.

We have just elected a President who has openly claimed that his administration would “Spread the wealth.” His own words are that he is going to tax the rich and give to the poor. He bought his presidency with his massive amount of funding (from unknown, questionable and perhaps illegal sources) and with his promises to cut the taxes of 95% of the people.

The problem with this statement is that the bottom 40% of the population does not pay any income tax at all. So, if they do not pay any taxes, how do they get a tax cut? It is simple. All we have to do is redefine the programs that are being given. There will be an increase in the number of people who are eligible for Federal aid. Food stamps, section 8 housing and free medical care will be defined as tax cuts. Offering this increased benefits bought Obama some votes.

But, remember that nothing is free. The funding for these programs is to come from taxing the rich. However, the bulk of the taxation is going to come from the middle class. You see, the rich can change their investment strategies and shift to tax free bonds and such. For the rich, these bonds will provide ample income for them. Also, there are other loopholes that the rich can use to shelter their assets and income. These loopholes will always be available. You don’t think the rich left is going to allow their funds to be taxed, do you. Remember, there are many rich liberals. The entertainment industry is filled with the ultra rich liberals, Oprah for one, but there are many others in the film industry. Do you think these people are going to get a big tax increase?

There are those who say that the “Evil Corporations are going to be taxes on their “Obscene Profits”. But, this is a fallacy. Corporations do not pay taxes. Sure, they may write the check, but do not think for an instant that they do not build the cost of these taxes into the price of their products and services. When their tax rate is increased, they will raise the price of their products to cover that increase. And, then the middle class will again pay the bulk of the new tax. But the poor, who have bought into the “lower income tax” mantra will also have to pay these taxes as well. (Yes, the rich will too.) We, the consumers pay all the tax for the corporations.

Here is an example. Suppose the new administration applies a special tax (they call it a windfall tax) on Exxon, what is Exxon going to do? First, they will raise the price of gas, oil and all the other products they produce to cover this tax increase. Perhaps they will even raise it more than the actual cost. They may even cut production in this country and shift their focus to other countries. There is nothing to say that they have to sell products in America. What would happen should Exxon pull out of America completely? How many jobs would be lost in drilling, refining and distribution of gas? What would happen to the price of plastics and all the other products they produce? And how many jobs would be lost in these industries? Remember, everything we consume involves oil at some point. Everything contains oil, or uses oil in the distribution.

Increased taxation on corporations cost jobs. HOWEVER, I am against tax breaks going to businesses.

No matter what is being said, the bulk of any tax increase is always paid disproportionably by the middle class and the poor. And remember, the rich already pay the bulk of the taxes in this country. The poor have no tax shelters available to them. They use all their income just to get by. The middle class may have a few options, but there isn’t much they can do to shelter income. Sure, there is investing for retirement in a 401K, but the coming administration has tossed around the idea of taking those over and allowing the Social Security Administration handles them.

And, we know how good the Social Security Administration has done at handling the funds they already have. There is no Social Security account. Social Security has been raided to pay for the multitude of unfunded mandates and social services that the Government is handing out. Offering these services to the illegal aliens is further bankrupting the system, as well as the nation. The fact is, the Federal Government needs these 401K accounts that we have saved for our retirements to keep the current pyramid scheme afloat.

It is sad that many of those who voted for Obama did so because of his proclaimed race. I am not against having a Black President. Nor Am I against having a Woman President. But the times we are facing demand a Great President. Race doesn’t matter. Sex doesn’t matter. Greatness is all that matters. And, for all his smoothness, for all the slick packaging surrounding Obama, he is not great. He, like most of the other presidents we have ever had, is nothing more than a puppet. His strings will be pulled by those who have contributed financially to his campaign, whoever they may be. He will be just like all the presidents before him who allowed outside interest to buy his office.

For those who voted for him to make a statement for their race, I fear that you will be disappointed. He can not make good on his promises, there isn’t the money to fund these programs without driving up the National Debt even more than it has been. Excessive taxation on profit takes away the incentive, and often the ability, for these companies to prosper and create new jobs. Excessive taxation on businesses is one of the factors that drive businesses to take their jobs offshore. Is this what you voters wanted? You may get your welfare check for a while. But, when more jobs leave, and the working class can no longer find jobs, there may be a backlash.

Or perhaps we can call it a revolution. Do you think that the middle class, the working class Americans will stand for a welfare class who has a better lifestyle than themselves? We are already seeing the beginnings of this happening. There hasn’t been an uprising yet. But that may be because the working class is too busy keeping a roof over their heads and food on their tables to realize that many of the welfare class are sitting in their Government owned homes, eating Government supplied food (often steaks and other foods that we, the working class can not afford to eat), smoking their cigarettes and drinking their beer that they could afford out of their welfare checks (often for disabilities that have come to light in the last decade such as ADD, ADHD, “depression” and other things that didn’t stop people from working in the past).

We need a change in the way the welfare system is run – both in reference to the banking bailout and the family down the street. The main problem is the waste in the system. Of course, in that these are Government systems, there is always waste in them. I don’t know what the current figures are, but I do have something interesting that I recently hear. This is from a speech that Ronald Reagan made on October 27, 1964. Remember, the cost of living has changed since those days. But, I would not be surprised if the ratio is the same, or maybe even worse than it was then.

“Now we’re told that 9.3 million families in this country are poverty stricken on the basis of leaning less than $3,000 a year. Welfare spending is 10 times greater than in the dark depths of the Depression. We’re spending $45 billion dollars on Welfare. Now, do a little arithmetic, and you’ll find that if we divide the $45 billion equally among those 9.3 million poor families, we’d be able to give each family $4,600 a year. And, this added to their present income should eliminate poverty. Direct aid to the poor, however, is running only about $600 a year. It would seem that someplace there must be some overhead.”

I would have to agree. The fact that it took, at that time $4,000 a year to give each poor family $600 of aid is a ridiculous waste of American Taxpayer’s money.

In the same speech, he was talking about a refugee from Cuba who disagreed that we were lucky. The Cuban’s point of reference was that he had a place to escape to, where (should our system fail) do not have anywhere to go. What are we doing to the country that has become the refuge of the world?

Another point Reagan made was about the cases of people, mostly women, who were getting divorces just because being a single mother they would receive more than their husbands were earning. This behavior is tearing the fabric of the American family. I do not imply that this situation is a Black problem. The reality is, this is a societal problem. It involves Whites, Blacks, Asian, and Native Americans. Welfare destroys families. Welfare encourages more welfare. Be it corporate welfare or welfare for the masses, welfare does not work.

Now, for those African Americans, not all of you – just the ones who carry the animosity toward Whites because some of you have descended from slaves. My people, the Native American side of my family, were enslaved just as you. We lost our land. We were forced to accept a foreign culture, language and religion. We were forced to take submit to a new and foreign legal system that did not allow us to bring suit against a White, or to testify against a White in court. We were not allowed to vote, until you were. And, you know in those movies about the Wild West in the late 1800’s where the Native American went into the saloon for a drink and was told “We don’t serve your kind.” It was the law. In fact, until 1953 Native Americans could not legally drink or possess alcohol. In California, during the gold rush days, any unemployed Native American was subject to slavery. And, it was common for Whites to murder the parents of children so the children could be sold as slaves. And, in other parts of the country, Native Americans were subject to either being enslaved, or killed for a bounty (scalps were worth $100 at times). And, it is not often discussed, but Whites were also slaves. There are even cases where Whites had Black Masters. And, as for the matter of treatment during the slavery days, I’ll ask this question. In that a good Black slave would cost as much as $1,000, and a White slave could be bought for as little as $50, who do you think got the dangerous jobs?

And to those African Americans I would say: look around you. Look at the way you live. And then look at the African countries where your ancestors came from. Look at how they live there. I am not saying this to excuse slavery. There is no excuse for slavery. What I am saying is, even the most poverty stricken person in America has a better standard of living than the average person in those countries. The big difference is, in America we have the opportunity to bring ourselves out of poverty. In America we have to opportunity to succeed. All we have to do is WORK at it.

Now, I believe, and always have, that slavery is wrong. Those countries who continue to enable slavery should be shunned. But, in America, it is also in the past.. But, there is nothing we can do about the past other than hoping to avoid repeating it. Repeating the past must be avoided.

Continuing to hate for what happened in history doesn’t work. Continuing to use the past for present failure doesn’t work. Continuing to demand reparation for harms done in the past doesn’t work. What it will take to restore America is to not only allow personal intuitive to work, but to insist that people work.