Primary Day Blues

David Prusky
50 Boatswains Way #114
Chelsea, MA 02150

Friday, October 02, 2009

To: The Editors
The Chelsea Record

HI

Laws without logic do not work well.

At least four recent major laws have had unintended consequences related to lobbying, partisanship, shortsighted thinking and arrogance.

The Troubled Assets Relief Program (TARP), otherwise known as the bailout bill was supposed to protect home values, college funds, retirement accounts, and life savings. It was supposed to preserve homeownership and promote jobs and economic growth. It was supposed to provide public accountability. It defined “troubled assets” as residential or commercial mortgages and securities, obligations, or other instruments that are based on or related to such mortgages. We were told that there would be transparency.

Instead foreclosures continue to this day. Unemployment gets bigger and is approaching double digits on average. In some parts of the country unemployment has already reached 17%. Regulators committed money while refusing to disclose loan recipients (banks) or reveal the collateral they took in return. Banks used the money for acquisitions (banks purchased other banks) and to stabilize their bottom line. We may never know exactly what happened to 350 billion dollars. The federal government is prepared to provide more than 7 trillion dollars on behalf of American taxpayers (that’s you and me that are on the hook) over and above TARP to corporations that helped cause the problem in the first place. — The bailout has cost more than the Marshall Plan, the Louisiana Purchase, the Race to the Moon, the Savings & Loan Crisis, the Korean War, the New Deal, the Invasion of Iraq, the Vietnam War. And the National Aeronautics and Space Administration, COMBINED. The only single American event in history that even comes close to matching the cost to you and me is World War II.

The stimulus package came next. 787 billion dollars in federal stimulus money would flow into the economy making things better. Yet authorities predicted that some of that money would land in the hands of swindlers. It’s impossible to say how much was lost to fraud, but Gregory Kutz, head of special investigations at the Government Accountability Office, thought the losses could be staggering—indeed, in the billions. Kutz said that improper payments could be about 10%. That might be as little as 9 billion dollars. Or it could be more. We know that at least 4000 prisoners got stimulus checks.

Barack Obama urged passage of a massive economic stimulus package, vowing that it would “create millions of jobs by making the single largest new investment in our national infrastructure since the creation of the federal highway system in the 1950s.” Yet only about 5 percent of the 819 billion dollar plan went toward infrastructure. The economists told us that for every dollar spent on infrastructure we would get back about $1.50. That would be a 50% profit if it were a private company. One dollar spent on tax cuts would give back $1.03 which would be a 3% profit. Congress in its wisdom allocated about $42 billion for infrastructure and about $165 billion for tax cuts.

The economists also told us that for every dollar spent on unemployment benefits would have a payback of $1.63. Congress allocated less than 100 billion for unemployment. But consider the logic. If all 300,000,000 Americans were unemployed (it could happen) and each was given one dollar in unemployment, the economy would get back 489,000,000 dollars without anyone having a job to pay taxes on. Of course the entire stimulus was paid for by printed and borrowed money.
Then there is Cap & Trade. Many scientists today urge caution on global warming. A growing accumulation of global cooling science and other findings signal that the science behind global warming may be too shaky to warrant cap-and-trade legislation. Yet the House of Representatives has passed just such legislation. The models of global warming accepted by congress are not only wrong, they are so far off the mark as to be laughable. Satellite and bathythermograph data do not match the theory, which means that the theory is incorrect. Fact is supposed to override theory. We now have a Carbon tax based on erroneous models. The trade portion of the law was supposed to auction what amounts to permission to pollute with Carbon Dioxide. Instead many permits were simply given away. Those lucky or connected enough to get those free permits can now sell or trade them at enormous profit while you and I pay the extra cost.

And now we are told that we need health care reform or more properly health insurance reform. House Resolution 3200 is longer than War and Peace and not as interesting. It is however instructive to read some of the bill. — “Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day of Y1.” — Y1 is the first year of the bill becoming a law. Now we ask, what does this paragraph say? It says that if you do not have health insurance before the first day of the law, you can’t buy it from an individual health insurance issuer. You therefore must use the public option. Purchasing health insurance will be mandatory. Yet the Federal Government does not have the authority under our Constitution to force you to buy apples, oranges, automobiles or health insurance. But congress is going to do this anyway.

You and I have certain unalienable Rights. Among these are Life, Liberty and the pursuit of Happiness. — To secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it. You and I have failed to take Government to task. Therefore the logical result will be the loss of our rights.

Yours
David Prusky