The song remains the same!

Throughout the week, we have been bombarded with news of the bonuses given to employees of AIG. Though I will certainly address that; there are a few other details that remind us that “change” is nowhere in sight. Today, the deficit soared to $1.8 trillion while the California unemployment rate rose to 10.5%, it’s highest since 1983. One can only imagine what those stats are going to do to the market today. My original optimism is slowly waning. All I see is business as usual. The promise of Congressional oversight and the numerous bailouts and stimulus plans have, so far, accomplished zip. I have preached patience and will continue to do so but there are those in key positions who are performing as if they took a seminar put on by the Bush administration.

I am referring to Treasury Secretary Geithner and Democratic chairman of the Senate Banking Committee, Sen. Dodd of Connecticut. These two misfits have more to answer for than those greedy suits at AIG. Dodd, the highest ranking member of banking oversight community, claims that he had no knowledge of these bonuses. If that is true; then he truly is an idiot. I actually hope that he’s lying so he can blend in with the rest of them instead of being perceived as a moron. Treasury Secretary Geithner, an old Wall Street boy himself, seems to have shown complete indifference to the situation. Since the Fed now owns 80% of AIG, where was its fearless leader while this travesty was unfolding? Thanks in part to these two do-nothings; it is President Obama who now has egg on his face, and justifiably so.

AIG-where do I begin? First and foremost; I question the moral turpitude of any individual associated with AIG who accepted these bonuses because there were those who declined. $165 million to a group of people who are as responsible for our economy’s demise as anyone. The present and past CEOs of the company are now playing the blame game as far as who is responsible for these rendition bonuses. Who gives a damn who is responsible for creating this system-flush it!! While all this is happening, Geithner and Dodd both confess to being concerned about the possible legal implications of refusing to give out these bonuses. Who the hell are they going to sue? The government is the “chief stockholder.” Which brings me to my next question. As “chief stockholder”, shouldn’t we have had a say in the dispensing of these bonuses? Apparently not since no one stepped up to the plate. Oh yeah-I forgot that they were unaware.

As previously stated; Obama is now the one who looks the fool. His only salvation seems to be the House vote to levy a 90% tax on these bonuses. Now if only the Senate would step forward and impose a fine for misappropriation of funds. Though this may sound counter-productive; the way things are going this may be our only way to get any of our money back. I apologize for the tone of this article but I am pissed.

Urgency-I'll give you urgency!

In a past article, I pointed out how impressed I was with the way the President carried himself and maintained an air of optimism throughout the majority of his speech. What I neglected to mention was that he may have overemphasized the fear portion a bit. Many analysts commented on the same thing and criticized him for attempting to scare Americans into being more receptive to his plans. I felt that perhaps by focusing too strongly on the urgency; he was looking for a way to justify some of his perceived excessive spending. Well, if anything, he did not focus on the urgency enough.

The Washington Post commented that the President lacked the enthusiasm necessary in some of his previous speeches. Former President Bill Clinton publicly criticized him on that very thing. Some of the President’s detractors pointed out that he focused primarily on economic issues with not enough attention given to foreign affairs. For that, I applaud him. For too many years, Bush cloaked the eroding economy with a barrage of patriotic rhetoric centered on Iraq and Afghanistan sprinkled in with the threat of a nuclear presence in North Korea and Iran. In no way do I mean to trivialize these dangers, however, they were not the greatest dangers facing our country.

It is time to step off my soapbox and provide some sobering numbers to hammer home my point. As reported by MSNBC News; the U.S. Department of Labor and the Commerce Department had the task of delivering these harbingers of doom. I will attempt to encapsulate these statistics into 3 categories: housing, unemployment, and manufacturing. Beginning with housing; new home sales are at an all-time low and home resales are at the lowest they have been in 12 years. The value of homes is quickly dropping far below the amount that was borrowed. The Housing Bill only provides relief for those whose value falls 5% or less. And still he smiled.

Grouping unemployment and manufacturing is simple enough. I will start with the most startling statistic I read. People receiving unemployment benefits, coupled with those who are receiving additional funds due to an extension granted by Congress, is 6.5 million!! The figure at this time last year was 2.8 million which we felt was alarming. And still he smiled. New unemployment claims last week alone totaled 667,000-the worst since 1982. The current rate is an unbelievable 7.6%. And still…all right, all right.

Regarding manufacturing; the Commerce Department reported that big ticket item sales fell for a record 6th straight month. This is also a reflection of the state of the global economy. Consumers have simply cut back on purchases of any size which, of course, leads to increased job cuts. As an example, though not a manufacturer, J P Morgan Chase&Co. has recently announced that it plans on eliminating 12,000 jobs. Economist Zach Paul stated that corporations, regardless of size, have been forced into “working with the minimal work force possible”. Believe me; I have more but for your sake and mine we will concede that the point was made. To be kind, I didn’t touch on the banking industry.

Maya MacGuineas, President of the Bipartisan Committee for a Responsible Federal Budget (quite a title) was quoted as saying: “They’ve painted the worst-case scenario in order to make it as easy as possible to improve on”. There is NO WAY she said that with a straight face. Other detractors point to the excessive spending in the new bills and budget as merely adding to an already ridiculously high deficit. To them I say: I couldn’t care less. To quote the late inspirational football coach George Allen: “The future is now!” Given these numbers, drastic measures are imperative. We must keep in mind that the President inherited these problems and is being as aggressive as possible to resolve them. I respect the man for even running for the presidency considering the state our nation is in. And still he smiled.