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Fed threatened bank CEO - Obama Thugocracy

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from Yahoo News
By Anne Flaherty
Associated Press Writer
Jun 10, 2009


WASHINGTON – The Federal Reserve threatened to force the ouster of Bank of America CEO Kenneth Lewis if he didn't follow through with plans to buy Merrill Lynch & Co., Republicans said Wednesday after reviewing internal documents.

Republicans also said there was evidence that the government tried to restrict information related to the merger from being publicly released.

However, none of the documents showed that the government explicitly instructed Bank of America to hide Merrill Lynch's losses from shareholders, they said.

The House Oversight and Government Reform Committee is investigating claims that top government officials, including then-Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke, urged Lewis to go through with the acquisition and not disclose to shareholders the details of Merrill Lynch's deteriorating financial state.

Lewis was scheduled to testify on Thursday before the panel, which is chaired by Rep. Edolphus Towns, D-N.Y.

Bank of America has received $45 billion from the government's $700 billion Troubled Asset Relief Program. As part of that money, the bank received $20 billion in January after Lewis requested it to help offset mounting losses at Merrill Lynch.

According to an internal memo prepared by the committee's Republican staff, Paulson and Bernanke "put a gun to the head" of Lewis and Bank of America's board of directors to force the merger even though Lewis "felt it was his duty to his shareholders to try his luck in the legal system and back out of the deal."

As proof, Republicans cite several documents including an e-mail by an employee at the Richmond Federal Reserve who said Bernake had made it clear that if Bank of America backed out and needed financial assistance, "management is gone."

Just a few weeks after the deal was completed, Bank of America's fourth-quarter earnings report showed the hit its balance sheet took on the Merrill Lynch transaction, making Lewis the target of shareholder anger.

In January, Bank of America reported a $2.39 billion fourth-quarter loss and Merrill Lynch disclosed a loss of more than $15 billion.

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More Empty Words and Political Showmanship

This is an excellent article from America's Right detailing Obama's absurd announcement admonishing fiscal restraint. As they say, you can't make this stuff up.
Rees

from America's Right
by Jeff Schreiber
June 9, 2009

I heard him make the announcement today, and tried as hard as I could not to laugh or cry.

What position is Barack Obama in to preach fiscal responsibility and restraint? My goodness, the hypocrisy is so gosh-darned thick here that even Al Gore, riding in his carbon-spewing private jet on the way to a "climate change" conference, is likely shaking his head.

Furthermore, what the AP piece doesn't seem to mention is that Congress already has a "PAYGO" rule in place, and has had that rule in place since 2007. The problem, contends the Heritage Foundation, is that it is "merely a congressional rule" and therefore can be easily waived by elected officials. In fact, such a waiver happened recently -- for Barack Obama's so-called "stimulus" bill.

From that same February 26, 2009 Heritage piece, a list of six problems with PAYGO:

•PAYGO Would Not Decrease the Growth of Federal Spending. PAYGO is not designed to reduce federal spending. It is not even designed to slow the growth rate of spending. It only limits the creation of new entitlement benefits above the spending growth baseline. In fact, entitlement spending grew faster after statutory PAYGO took effect in 1991.[2]

•PAYGO Exempts Discretionary Spending. Discretionary spending programs--which comprise nearly 40 percent of the federal budget--are totally exempt from PAYGO rules. In other words, Congress could provide unlimited budget increases to most defense, education, health research, justice, international, environmental, veterans' health, homeland security, and housing programs without triggering PAYGO. This loophole is a major flaw that substantially weakens PAYGO.

•PAYGO Exempts Current Entitlement Benefits. Under PAYGO, current entitlement programs can continue to grow on autopilot. Only newly created entitlement benefits must be offset. In short, PAYGO would not prevent (a) Social Security from growing 6 percent annually; (b) Medicare and Medicaid from growing 7 percent annually; and (c) Nominal entitlement spending from nearly doubling over the next decade. PAYGO could theoretically slow down the creation of any new entitlements. Yet the nation's main budgetary challenges stem from the $44 trillion unfunded obligation from Social Security and Medicare, as well as the growing costs of current entitlements like Medicaid. PAYGO would do nothing to reduce the growth rate of these programs.

•PAYGO Employs a Double Standard That Raises Taxes. Every few years, Congress must review and renew most entitlement programs and many tax cuts. PAYGO sensibly says that renewing an existing entitlement program is not "new" spending and therefore does not need to be offset. However, PAYGO applies a different standard to tax cuts. It classifies tax cut extensions as "new" tax cuts that violate PAYGO and must be offset. This makes no sense. PAYGO was intended to block the creation of new policies that increase the deficit. Simply keeping current tax policies in place should not be treated as "new" tax cuts. Additionally, the blatant double standard of allowing entitlement spending policies but not tax policies to be extended constitutes a major bias towards higher taxes and spending. For instance, PAYGO allows the extension of expiring SCHIP and farm subsidy laws, but it does not allow the extension of the 2001 and 2003 tax cuts or the Alternative Minimum Tax (AMT) to be patched without offsets. Even President Obama has criticized this double standard, and Congress should eliminate this baseline disparity from any PAYGO statute.

•Previous PAYGO Statutes Were Never Enforced--Even Once. Congress already had a PAYGO statute from 1991 to 2002. But this law was never enforced. Over the statute's 12 years, Congress enacted more than $700 billion in new entitlement spending and tax cuts--and then enacted legislation cancelling every single sequestration. Even if Congress had allowed sequestration, they had already enacted legislation exempting 97 percent of all entitlement spending--all but $31 billion--from being part of any sequestration. The law was practically designed to fail. Entitlement spending actually grew faster during the 12 years of PAYGO (1991-2002) than in the 12 previous years (1980-1991). The budget did temporarily achieve balance during that period. Yet PAYGO had very little to do with it. The budget was balanced by the combination of the dot com bubble revenue boom, defense savings after the Cold War ended, and declining net interest costs.

•Current PAYGO Rules Are Not Enforced. Congress has operated under a PAYGO rule since 2007. In that short period of time, Congress has already bypassed PAYGO to: (a) Enact a stimulus bill that cost $479 billion in new entitlements and tax cuts; (b) Enact a veterans' education entitlement bill costing $63 billion; (c) Enact a student loan expansion costing $15 billion; (d) Twice patch the AMT; and (e) Enact SCHIP and farm bills that used blatant gimmicks to hide tens of billions of dollars in new entitlement benefits.

This is not a fix. This isn't even substantial enough to qualify as a gimmick. Our spendthrift president calling a press conference and advocating PAYGO is merely an act of political gamesmanship born from West Wing worry about the perception of this administration's lack of fiscal restraint and meant to appeal to the lowest common denominator in terms of those who pay attention to the goings-on in Washington, D.C. It's meant for a soundbite to be heard by clueless people from coast to coast as they wait for the five-day forecast from their local news station. It's meant for a headline in Obama-friendly newspapers to be read by people, through the plexi-glass of the vending machine, as they wait on a train or bus or traffic light.

Then again, how is this any different than anything done by this administration so far?
Click to read the comments and other great articles at America's Right

Obama Triples Deficit then pitches pay-as-you-go plan! - What BS! - Has he no shame?

Obama more than triples the deficit, then pretends to be innocent of the whole process by offering this self-righteous "if you irresponsible people are going to continue to spend foolishly, I'm going to have to impose on you a "pay-as-you-go plan" to reign things in. He is unbelievable. He truly does believe that the majority of American voters are absolutely stupid. He'll find out how stupid we are all in 2010 and 2012.
Rees

Obama pitches pay-as-you-go plan for Congress
from Yahoo News
by Ben Feller
Associated Press Writer

WASHINGTON – President Barack Obama on Tuesday challenged Congress to pay for new increases in federal benefit programs as it goes rather than sink the nation deeper into a debt, calling it a matter of public responsibility. Republicans lashed back that Obama is no voice of fiscal restraint as the deficit soars.

The president's plan would require Congress to pay for new entitlement spending, such as health care, by raising taxes or coming up with budget cuts — a "pay-as-you-go" system that would have the force of law. Under the proposal, if new spending or tax reductions are not offset, there would be automatic cuts in so-called mandatory programs — although Social Security payments and some other programs would be exempt.

Not noted by the president: Tuesday's plan is a watered-down version of the so-called "PAYGO" rules proposed just last month in his own budget plan.

That version would have required, on average, all affected legislation to be paid for in the very first year. The new plan only requires such legislation to be financed over the coming decade. That mirrors congressional rules and reflects the likelihood that health care reform will add to the deficit in the early years.

Obama said the principle is simple: Congress can only spend a dollar if it saves a dollar somewhere else.

"It is no coincidence that this rule was in place when we moved from record deficits to record surpluses in the 1990s — and that when this rule was abandoned, we returned to record deficits that doubled the national debt," Obama said, flanked at the White House by supportive Democratic lawmakers.

"Entitlement increases and tax cuts need to be paid for," he said. "They're not free, and borrowing to finance them is not a sustainable long-term policy."

Republican leaders, critical of the Obama-championed $787 billion stimulus package and other deficit spending, called the president disingenuous.

"It's as if the administration and these Democrat leaders are living in an alternate universe," said House Republican Whip Eric Cantor of Virginia. "The quickest way to save money is to stop recklessly spending it."

The pay-as-you-go rules would not apply to discretionary spending — the portion that Congress decides how to spend each year — which accounts for almost 40 percent of the budget, said Peter Orszag, the administration's budget director.

Obama's call for binding legislation comes as a reward to moderate-to-conservative "Blue Dog" Democrats who are big believers in pay-as-you go. Their votes were crucial to passing a congressional budget blueprint that generally follows Obama's budget.

The House and Senate already have their own PAYGO rules, but have routinely found ways around them. For example, a bill to effectively double GI Bill education benefits was enacted last year because of a loophole in congressional rules.

Obama's "PAYGO" plan would also require future tax cuts to be financed by tax increases elsewhere in the code, though exceptions are made for extending President George W. Bush's 2001 and 2003 tax cuts, as well as other tax cuts that are scheduled to expire.

The federal deficit is on pace to explode past $1.8 trillion this year, more than four times last year's all-time high.

The deficit figures flow from the deep recession, the Wall Street bailout and the cost of the economic stimulus bill. Obama has defended the massive stimulus plan as essential to helping pump some life back in the economy, one that is still shedding jobs but showing more signs of life in recent weeks.

"The fact is, there are few who aren't distressed by deficits," Obama said. He said restoring a pay-as-you-go method under law would force lawmakers to deal not just with the politics and crises of the day, but also remain fixed on the nation's long-term financial health.
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Urkelnomics, Oops, Obamanomics Creating MORE Unemployment

from Flopping Aces
June 7, 2009
Posted by: Mike's America

So much for the promise of three million new or “saved” jobs!

Readers may recall that the Congressional Budget Office warned in February that passing the massive stimulus bill might actually damage the economy and in many ways was worse than doing nothing.

Democrats who cited the CBO as the gold standard of economic analysis when it criticized Bush Administration forecasts were quick to dismiss the CBO report.

Guess who was right?

Christina Romer, who now chairs the White House Council of Economic Advisors, put out this report as part of the incoming Administrations forecast of how Obama’s plan would save jobs. The following chart is taken from page 5 of the pdf of that report, with the actual unemployment numbers added in red by Innocent Bystander.


Sure does look like Obama’s plan is worse than doing nothing!

What’s worse is that the same bunch who brought you this obvious fiasco have published budget and spending forecasts that nearly all independent analysts criticize for being hopelessly flawed. The massive deficits, already at levels higher than at any time in our nation’s history, will cause even greater economic disruption.

Yes, Rosy Scenario is back in town in D.C. but she brought along her brother, Painful Truth. And the painful reality of the Obama Administration’s sheer incompetence on economic matters is already abundantly clear to the millions who are out of work due to Obamanomics.
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Obama wants a government takeover of American health-care, plain and simple

There’s No Doubt Now
from The National Review
by James C. Capretta

Those outside groups and interested parties who have held their fire in the health-care debate while waiting for the details to emerge — well, there really is no excuse now. Everyone should know what is coming.

On Tuesday, President Obama sent a letter to Senators Kennedy and Baucus outlining what kind of bill he wants and will support. And what he wants is a government takeover of American health-care, plain and simple.

Sure, the letter’s only three pages long (that constitutes a “plan” in this administration). But it was probably written to give the senators some political cover for the more controversial provisions they plan to pass, and thus it contains just enough coded language to confirm that all involved are planning to hand full control over American health-care to the federal government.

For starters, President Obama unequivocally endorses the creation of a new government-run insurance option for working age Americans and their families. For weeks, Senator Baucus has hinted that, well, maybe such an option isn’t necessary. That led many on the left to put pressure back on Democrats in Congress to deliver what they had promised — or else. With the president’s re-endorsement of the idea (he supported it during his campaign), it is now inconceivable that the Democrats won’t include a heavily price-controlled government-run plan in the bill they try to pass.

The Obama letter also endorses a so-called “individual mandate” — a requirement that everyone enroll in some kind of insurance or pay a penalty. During the 2008 campaign, then-Senator Obama made a big deal of opposing this idea — which was the centerpiece of Senator Hillary Clinton’s reform agenda. Now, however, he has flip-flopped — as Politico reported — and endorsed it, so long as “hardship” cases are exempt.

The individual mandate has long been accepted orthodoxy among most Congressional Democrats. For them, the real goal is to be able to say they passed “universal coverage,” and the only way they can say that they did is if they make those who would opt out enroll in something anyway.

Moreover, the individual mandate is the excuse for everything else they want to do. The government can’t make people buy insurance if they can’t afford it, so there needs to be an expansive new health-insurance entitlement program (Sen. Kennedy’s outline would allow everyone up to 500 percent of the poverty line qualify). And if there’s a mandate, the government must define what qualifies. And on and on.

The primary obstacle in the way of rapid passage of the emerging Democratic plan remains cost. The bill will be enormously expensive, at a time when the federal government is already running massive budget deficits. Despite all of the talk of “bending the cost curve,” the Democrats have offered nothing that would put a dent in rising costs. And many rank and file Democrats are likely to balk at Senatir Baucus’s push to tax employer-paid premiums.

So what’s their way out? A gimmick, of course.

The Obama letter floats the idea which has been making the rounds among Democrats for weeks. Instead of making tough budgetary choices themselves, they are now hoping they can simply require some unelected, unaccountable advisory group — the Medicare Payment Advisory Commission (MedPac) — to find the savings for them.

This is the worst of all possible worlds. Call it the black box of government-driven rationing of care. MedPac — or any other federal agency for that matter — would be working from the same laundry list of price-controls and fee cuts that Congress has always used to try to control costs in governmental health programs. The idea that somehow an existing or new agency will discover new ways to painlessly reduce costs is a fiction. They would end up doing what every other government around the world has done — impose artificial cost limits on providers of services, which will reduce the number of willing suppliers and lead to waiting lists and queues.

Perhaps in this sense President Obama’s letter is a blessing. It is now much clearer how the Democrats plan to impose bureaucratic rationing of care on the public. This should become the basis for determined opposition, inside and outside of Congress.

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Obama promised not to increase "ANY" taxes for 95% of Americans - Oops!

National sales tax debate begins to stir
from the UPI
Published: May 27, 2009

WASHINGTON, N.Y., May 27 (UPI) -- Some key U.S. economic advisers have said a federal sales tax should be considered an option to help balance the books and pay for healthcare reform.

An unthinkable political option in years past, a budget deficit projected at $3.1 trillion over this year and next and a trillion dollar extension of national health coverage proposed by President Barack Obama have pushed a so-called value-added tax closer to serious national debate, The Washington Post reported Wednesday.

The chairman of the Senate Budget Committee Kent Conrad, D-N.D. has declared that "a VAT and a high-end income tax have got to be on the table."

Former Federal Reserve Chairman Paul Volcker has expressed cautious support for a national sales tax. White House Budget Director Peter Orszag has hired Ezekiel Emanuel, a strong proponent of a value-added tax as a consultant on healthcare reform, the Post said.

Orszag spokesman Kenneth Baer said the system, considered a regressive tax, "is popular with academics but highly controversial with policymakers."

"People are beginning to recognize that the mathematics of the current system are just unsustainable," said Yale Law professor Michael Graetz.

"A VAT has got to be on the table if you want to do something big and serious," he said.

The Faces of Government-run Healthcare - See the Faces, Listen to the Voices

This provides an important perspective into universal healthcare. It's worth a few minutes to watch some of the videos and listen to their stories.
Rees

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