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Friday, October 26, 2012

Our Economy is Collapsing. The Liberals will Now Institute Some Kind of Neo- Fascism or Socialism or Some New Blend to Maintain Power.




8.06.2009

Despite numerous warnings and other signs, our economy is slowly collapsing and the liberals just plod onward in their greedy quest for bigger government, higher taxes and more power. [1][2][3] Our federal government is slithering down the same latrine as California[4][5][6]—heading for bankruptcy. They can do nothing more than tax and spend thus they share the same mentality and outlook as those in Sacramento although they cannot print money yet. They can issue IOUs. Both governments refuse to cut anything. Those who stooge for liberals (like Paul Krugman) drone on and on about higher and higher taxes and nationalization of banks and socialized medicine and more government control of everything.[7][8]  Such allied political groups may soon be incorporated into something resembling an amalgam of the New Fascists, Marxists, Leninists and the New Socialists and perhaps other oddities yet to be invented. All this is beginning to look like an opportunity to grab wealth and power by the left using a fusion of Fascist and socialist political systems. The left apparently want to carve out some new, vast and all-powerful government from the chaos of depression and inflation. Their lust for power is unquenchable. They are driving us into that maelstrom.

Debt

We are busted. Our debt levels are so high that even the Chinese complain about the stability of our currency.[9] People cannot seem to think about GM in anything but political terms. GM had lost a total of $80 bln dollars and to make that up with a 10% profit they would have to sell $800 bln dollars in cars, more than the current bailout. $800 bln dollars in autos would mean 20 million cars at $40,000 per car or in they can only make 1% then that would require a sale of 200,000,000 cars. GM expects $50 bln in bailouts for the first round[10] as some of their models are shut down and their market share drops below 19% of the auto market in the US. In the Chrysler bankruptcy Obama called the bond holders ‘speculators’ and forced the bankruptcy judge to give away this secured debt to the unions [political allies] and some  obscure Italian carmaker who makes lousy cars. Thus, the federal government adjudicates debt and equity allocations and shifts ownership of assets to political allies.

Fannie Mae and Freddie Mac, poorly run historically by government people and their friends, hold half the nation’s mortgages for a sum of about$ 3.19 trillion dollars, much of that in worthless toxic assets and defaults rose from %1.3 to % 3.68. They will need a bailout.  Just less than 2 hours ago they fell prostate and begged for money![11] Now they want “$10.7 billion in new US aid after posting $15.2 billion second-quarter loss.” Isn’t that swell.  Their total holdings are now reported as $5.4 trillion which is roughly half of the US mortgages. How much of this disaster comes from the CRA [the phony Community Communist Reinvestment Act]?[12][13] Didn’t Barney Frank and Maxine Waters tell these political freak shows were sound?

Our net worth is down to some $57 trillion dollars and the combined national debt, Social Security, the national and foreign debt and Medicare now project spending of are now projected to be about $54 trillion dollars. That is broke.  By 2011 48% of all US homeowners will have negative equity in their homes thus erasing any credit from that asset.[14]

Incoherent Spending and Tax Lust

Idiots[15] in California[16] now run a 26% budget deficit[17] and with some accounting tricks and moans they can borrow and put off payments for a while and rob the cities of their scarce cash and what happens next year? They will have another such deficit!

Every trillion spent is a new tax liability for those who work and pay taxes [only about half of the work force pays federal income taxes] of $16,000 per trillion owed on average. [18] There is no way workers can pay this back in 20 years as the total of all debts now exceeds $600,000 per taxpayer above the median.  The 2009 Obama deficit will soar beyond $2.87 trillion as it now stands.[19]  That is more than $45,000 in new debt this year alone per taxpayer who pays taxes. We now have 34 million or %11 of the population on food stamps. About 5 million illegal aliens [this exact number is disputed] have subprime mortgages[20] and many are in default. They can vote in many states but do not file federal or state tax returns. Citibank was accepting tax ID numbers instead of Social Security numbers. [21]

Our tax revenues are sinking fast:

“The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.”[22] – AP Enterprise: Federal tax revenues plummeting By Stephen Ohlemacher, Associated Press Writer – Mon Aug 3 [Emphasis is mine in all quotes
unless specifically indicated as in the original.]

“The last time the government's revenues were this bleak, the year was 1932 in the midst of the Depression.”-- By Stephen Ohlemacher, AP – Mon Aug 3, 2009

“Is there a way out of the financial mess?

A key factor is the economy's health. The future of current programs — not to mention the new ones Obama is proposing — will depend largely on how fast the economy recovers from the recession, said William Gale, co-director of the Tax Policy Center.”-- By Stephen Ohlemacher, AP – Mon Aug 3, 2009

“President Barack Obama has said he wants to tackle Social Security next year, after he clears an already crowded agenda that includes overhauling health care, addressing climate change and imposing new regulations on financial companies.”-- By Stephen Ohlemacher, AP – Mon Aug 3, 2009

Well, there are no examples of the government “streamlining a federal program” or “saving money” if we examine the histories of education, Head Start, welfare, Amtrak, Social Security, Medicare, the Postal Service and the military. Can some of us recall the War on Poverty, Great Society, HUD, and some other failures? What happened to their promises on those? They have NEVER been able to cut out waste and inefficiency because they refuse to fire incompetents. Amtrak, established in 1970 has never made a profit in a single year to date.

And in a sinking economy they talk not of cutting but taxing and spending more:

“Rep. Richard Neal, D-Mass., chairman of the House subcommittee that oversees fuel taxes, is working on a package to make the fund more self-sufficient. The U.S. Chamber of Commerce, which doesn't back many tax increases, supports increasing the federal gasoline tax, currently 18.4 cents per gallon.”-- By Stephen Ohlemacher, AP – Mon Aug 3, 2009

They now expect to add in Cap and Trade energy taxes that will increase costs everywhere in the US. The proposed Cap and Trade taxes would be world wide.[23] Some even call for a second ‘stimulus’ even thought the first one did nothing we can see as yet.[24]

Power from Chaos

This is really insane: they either think they can spend their way out of this mess OR they think they can make out politically from a complete collapse of our economy and that is what looks to be the case in Washington.  That would require a new form of authoritarian government and that would be some blend of Fascism or Neo-Fascism in this case and socialism or Leninism.

Fascism was invented by Benito Mussolini who was editor of the biggest socialist newspaper in Italy and he states quite clearly in his autobiography[25] that he hated capitalists. Hitler ranted on about capitalists but was forced to make a deal with the Junkers for money to finance his political campaign.  The old definitions of Marxism, socialism and Fascism are too rigid to describe what is happening. We need to select parts and pieces of each system and fit them into a new puzzle to describe what is going on the US today.  Racism, as usual, plays a dominant role in leftist politics. [26] The only people now remaining on the true ‘right’ are the followers of William F. Buckley, Jr., Ronald Reagan, Michael Savage[27], Mark Levine[28] and Rush Limbaugh[29] among several others. None of these persons ever wanted or even suggested bigger government or any ‘socialized’ government ‘program’ of any kind  and stated this negative position against the left  loudly and clearly for decades. Their calls for tax cuts infuriated the left because all they have or can get derive from taxpayers, business owners or landowners or salaried workers above the median income. The left cannot be forced to believe that tax cuts encourage economic growth. They view tax cuts as an expense. Except for a growing number of Americans who sense that things are not going well and that the obvious promises of President Obama have not been fulfilled, the Democrats have full power to do anything they want and they clearly want more power. We have to worry how this new system might act if we have some more financial crises. A major crisis might perturb the food supply or transportation ‘or energy supply  and cause a panic.

Here, in this new blend of socialism and control of business—similar to the People’s Republic system that mixes totalitarianism with 16th century mercantilism—the government would control business by takeovers and replacing management along with canceling equities and nullifying bonds and nationalize only the banks and other selected businesses. Bond holders[30] in the auto industry were recently deemed “speculators” [read greedy] by Obama.[31] Perhaps stock holders and pension funds that buy bonds are “speculators.”  Are homeowners with paid-up mortgages “greedy?” It appears that anybody with assets is a target of the left. Maxine Waters[32] threatened to nationalize [socialize in her words] the oil companies[33]during one of her tirades.

The association with the process where government directly runs businesses is old hat in modern terms and there is no reason to match the new Neo-Fascism with the right wing. Socialism strictly requires[34] that the government controls state-owned and tolerates private businesses and controls access to such services and products but that never works. Marxism is much worse. What I see is a new symbiotic relationship between socialism and Fascism, both elements of the left—not the right—to form a new system. For clarity, the Nazi party was far left and was called The National Socialist German Workers' Party (German:  Nationalsozialistische Deutsche Arbeiterpartei , abbreviated NSDAP), commonly known in English as the Nazi Party.[35] What Hitler got in a democratic procedure  was an enabling act that gave him permanent powers very similar to what Treasury Secretary Timothy Geithner attained by law and who has unlimited powers to print money and restructure banks  and who knows what in our economy without any interference or opposition from the courts or anybody else. Think about this. Did Hitler have this much power?

The path forward put forth by Congress and the White House is so brainless that I now believe that the ‘plan’ is to let the economy go down in flames by printing money as fast as they can so that our bank accounts will become worthless. Then the government can step in and declare capitalism a failure, ‘restore order’ and seize tangible assets to later be ‘spread around’ for the ‘poor’ and the dream of redistribution of wealth by the rabid left will become a reality. Greedy speculators and bond holders and those who are debt free thus become of enemy of the New State and their holdings such as 401(k)s, homes and businesses might be subject to seizure. This is what the Bolsheviks did in 1918-1919 and what they tried to do in Germany, Spain and Italy.  It is interesting that Bolshevism was halted by an internal squabble among leftists.  There is no such division among those players now.

We have major problems approaching and very soon. It is becoming more difficult to believe we can trust our government. They want to pass laws before the elected representatives have had the opportunity to read the legislation.

rycK

Comments: ryckki@gmail.com


[11] Fannie Mae seeks $10.7B in US aid after 2Q loss

Fannie Mae seeks $10.7 billion in new US aid after posting $15.2 billion second-quarter loss By Alan Zibel, AP Real Estate Writer On Thursday August 6, 2009, 7:25 pm EDThttp://finance.yahoo.com/news/Fannie-Mae-seeks-107B-in-US-apf-3979081619.html?x=0&.v=10
[12] “Bear Stearns made the first public securitization of Community Reinvestment Act (CRA) loans started in 1997.[6] Editorialists in some American newspapers[7][8] and US Congressman Ron Paul[9] say the CRA loans were lent to otherwise un-credit-worthy consumers in the name of ending discrimination, although an analysis of actual lending patterns does not generally support this conclusion.[10][11][12]
On June 22, 2007, Bear Stearns pledged a collateralized loan of up to $3.2 billion to "bail out" one of its funds, the Bear Stearns High-Grade Structured Credit Fund, while negotiating with other banks to loan money against collateral to another fund, the Bear Stearns High-Grade Structured Credit Enhanced Leveraged Fund.[13] The funds were invested in thinly traded collateralized debt obligations (CDOs) found to be worth less than their mark-to-market value. Merrill Lynch seized $850 million worth of the underlying collateral but only was able to auction $100 million of them. The incident sparked concern of contagion as Bear Stearns might be forced to liquidate its CDOs, prompting a mark-down of similar assets in other portfolios.[14][15] Richard A. Marin, a senior executive at Bear Stearns Asset Management responsible for the two hedge funds, was replaced on June 29 by Jeffrey B. Lane, a former Vice Chairman of rival investment bank, Lehman Brothers.[16]
During the week of July 16, 2007, Bear Stearns disclosed that the two subprime hedge funds had lost nearly all of their value amid a rapid decline in the market for subprime mortgages.

[13] http://en.wikipedia.org/wiki/Community_Reinvestment_Act
Community Reinvestment Act (or CRA, Pub.L. 95-128, title VIII, 91 Stat. 1147, 12 U.S.C. § 2901 et seq.)


[14]“ NEW YORK (Reuters) – The percentage of U.S. homeowners who owe more than their house is worth will nearly double to 48 percent in 2011 from 26 percent at the end of March, portending another blow to the housing market, Deutsche Bank said on Wednesday.
Home price declines will have their biggest impact on prime "conforming" loans that meet underwriting and size guidelines of Fannie Mae and Freddie Mac, the bank said in a report. Prime conforming loans make up two-thirds of mortgages, and are typically less risky because of stringent requirements.” http://news.yahoo.com/s/nm/20090805/bs_nm/us_usa_housing_deutschebank

[15] No other word exists to my knowledge to describe these drug-crazed loons in Sacramento who profess that they are ‘progressive. Well, maybe parasites describe some of their actions, but clever parasites do not kill off the host and then die from starvation.

[16] Arnold Makes a Noble Stand. We will See if He Can Fight Off the Hoards of Barbarians at the Gates.
http://rycksrationalizations.blogtownhall.com/2009/06/30/arnold_makes_a_noble_stand_we_will_see_if_he_can_fight_off_the_hoards_of_barbarians_at_the_gates.thtml

Copulating with Coprolites: The Unveiled Mechanism of Governance by Progressive Liberalism in California
http://rycksrationalizations.blogtownhall.com/2009/06/23/copulating_with_coprolites_the_unveiled_mechanism_of_governance_by_progressive_liberalism_in_california.thtml

The Benefits of a Depression to the Tax Payers: Some States Will Have to Cut Away Many of their Phony Jobs. Illegal Aliens will Leave.
http://rycksrationalizations.blogtownhall.com/2008/10/21/the_benefits_of_a_depression_to_the_tax_payers_some_states_will_have_to_cut_away_many_of_their_phony_jobs_illegal_aliens_will_le.thtml

[18] The Upcoming Depression Explained: The Path Downward Outlined
http://rycksrationalizations.blogtownhall.com/2009/01/09/the_upcoming_depression_explained_the_path_downward_outlined.thtml

From an edited  previous blog: “Only half of the 130 million workers in the US pay taxes so a trillion dollars winds up to be $16,000 in tax liability for each worker who pays taxes. [18] Note that 20 trillion in debt becomes $320,000 in tax liability per worker who makes over $50,000. That means that the total equity [and more] of the homes of the average worker is in jeopardy.  The only people who can pay high taxes are those with wealth and property and they will be asked, or forced, to pay for most the new spending, debt service and new social programs. This debt is so large that it impacts the 401(k)s now so popular since Social Security is a grim  joke. The temptation by government is to seize the 401(k)s and blend this money into some federal retirement system patterned along the same lines as the USSR plan. All that wealth vanished in inflation by 1990.” [18]



[20] “Regional reports across the country have decried the subprime meltdown's impact on illegal-immigrant "victims." A July report showed that in seven of the 10 metro areas with the highest foreclosure rates, Hispanics were at least one-third of the population; in two of those areas - Merced and Salinas-Monterey, Calif. - Hispanics comprised half the population. The National Council of La Raza and its Development Fund have received millions in federal funds to "counsel" their constituents on obtaining mortgages with little to no money down; the group almost succeeded in attaching a $10 million earmark for itself in one of the housing bills passed this spring.” http://www.nypost.com/seven/09242008/postopinion/opedcolumnists/illegal_aliens__the_mortgage_mess_130482.htm

[21] “Citibank has been offering illegal aliens mortgages by using Taxpayer ID numbers instead of Social Security numbers to bypass the fact that these people are illegal aliens. On top of this they are actually giving these illegal aliens special treatment they wouldn't even extend to US citizens. This is an outrage. To the millions of Americans who cannot afford a home this is simply indefensible.”http://www.diggersrealm.com/mt/archives/001610.html

[22] AP Enterprise: Federal tax revenues plummeting By Stephen Ohlemacher, Associated Press Writer – Mon Aug 3 [Emphasis is mine in all quotes unless specifically indicated as in the original.]http://news.yahoo.com/s/ap/us_plummeting_taxes

[25] My Autobiography by Mussolini, Benito Charles Scribner's Sons, New York, 1928. First American Edition.
[32] Some form of protosimian sarcoma or a mass that acts like one.
[34] “Socialism refers to any one of various theories of economic organization advocating state, public or common worker ownership and administration of the means of production and distribution of goods, and a society characterized by equal access to resources for all individuals with a more egalitarian method of compensation”
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