The Automobile Task Force

Recently it was announced that part of a government approved restructuring plan Chrysler would be shutting about 25% of its dealerships and cutting its advertising budget in half. I can understand cuts, but cutting the availability of a product and the advertising for a product, doesn't usually help you sell MORE of a product.

But a better question is, who in the government negotiated and 'approved' this restructuring? In fact who has been working with the car companies on all of the bailout mess? Surely this must be some super group of former car company CEOs and execs who have successfully restructured and led car companies in the past, Lee Iacocca type figures.

Evidently not.

In fact the sum total of their car experience (a couple dozen people) is about... well... zero.

But don't worry, they all OWN cars... well, okay... maybe NOT ALL OF THEM OWN cars.

That's right.

They aren't even all car OWNERS. No dealers. No designers. No automotive engineers. No automotive execs. No car people on the automotive task force.

100 Days

President Obama will celebrate his first 100 days in office tomorrow. A modern milestone with little real significance but it is an opportunity for people to comment on his progress.

Personally I have a lot of issues with what has gone on in his first days as President. For that matter I have a lot of issues with what when on during the 120 days before he was President, from a fiscal perspective. I have been dismayed on almost every element of President Obama’s agenda accept for his troop build up in Afghanistan, which I think is necessary to restore order to that country and I believe Gen. Petreaus is exactly the man we need to oversee that conflict. On almost every other issue I can think of I would have to disagree with the direction the President is taking.

On foreign policy matters, the President has upset some of our most fervent and important allies, including, but certainly not limited to Israel. At the same time he has capitulated and apologized to nations who are bent on our destruction including Iran and Venezuela.

On fiscal matters he took the mistakes of the Bush administration and recommitted them on a whole new scale. During the campaign he talked about fiscal responsibility and stated that he would account for every cent of increase in spending with reductions in other areas. Unfortunately his first budget spends 90% more money than the government will see in revenue and quadruples the worst deficits of the Bush administration. He has already broken his promise not to increase taxes on those making under $250K a year by passing the SCHIP bill. He passed a stimulus bill laden with pork that has no hope of stimulating the economy, but rather paves the way for socialized medicine and completely strips away the welfare reform that was achieved under President Clinton.

On matters of life, that should concern every American, he has quickly removed restrictions on foreign aid for abortions, hinted at removing protections for doctors who have a moral objection to abortion, and opened up federal funding of embryonic stem cell research which requires the destruction of a living baby to ‘harvest’ the cells.

In all these first hundred days have been rough and will get worse. The main accomplishment of the administration is that they are moving at break neck speed, having the support of both houses of Congress.

In the near future there will be a big push for the following things:

- Health care reform. The goal long term is to put private insurance companies out of business and go to the single payer system. The first move will be a giant leap in that direction. If you don’t believe me, just listen to a Rep from the President’s home state.




- Cap and Trade. I know, I write about this one every day it seems, but it is an economic crusher. If this gets through it will put us into a depression that will take years and a complete reversal to bring us out of. Former Vice President Al Gore was on the hill this week testifying that this is the most important piece of legislation in our history and that it must pass. All for something that can’t hold up to scientific scrutiny. Shameful.

- Amnesty for illegal aliens. For years I have been hearing that there are 12 million illegal aliens in this country; people are pouring across the boarder and still there are only 12 million illegal aliens here. Hmm… sounds kind of fishy to me. Or the real number is really 2 or 3X the 12 million number that we are given. It won’t be called amnesty, it will be called “comprehensive immigration reform” or even something having to do with “refugees”. Immigration is great. Illegal immigration is, well, ILLEGAL! That’s the law! As the Chief Executive, our President should be enforcing it!

- Freedom of Choice Act. This is the anti-life bill that the President has pledged to sign. It will allow abortion at ANY POINT prior to actual delivery. It will remove parental notification laws, partial birth abortion bans, and will supersede any state restrictions that are in place. Tax dollars will fund it. It will undo years of incremental gains against abortion. It is sick and it is morally reprehensible… and it’s coming.

The first hundred days have been an expected mess. The next three years and 265 days aren’t going to be any fun either.

Remember your voice can make a difference. Call your Representatives, Senators, and the Whitehouse switchboard and tell them this is NOT the change you want to see in Washington.

Chris Dodd is an Idiot, So Now the House Wants to Throw the Constitution Out the Window

Okay, I understand everyone is upset about this whole AIG bonus mess. I am too. It’s Chris Dodd’s fault - blame him - he intentional took the measure that would have made these bonuses illegal OUT of the bill. Shocking I know.

The House is now passing measures that would ‘punish’ these executives by taxing the money by 90-100%.

One problem. That’s not constitutional. You cannot single out a group of people for taxable punishment under Article 1 Section 9 of the Constitution, “No Bill of Attainder or ex post facto Law shall be passed.” Even if the public is ticked off because their law makers are less than literate of their own bills, much less the constitution.

Sorry. The actual answer is for the government to STOP unconstitutionally using tax payer funds to bail out private institutions.

Outrage

There was a fury of outrage yesterday. Even being slightly sheltered from news on Mondays, I heard about the whole AIG bonus fiasco.

I wasn’t very surprised.

Don’t get me wrong, I was irritated. Not as much as the cash hungry swindlers at AIG, but at our government. This is what happens when the government plays in the private sector. Corruption and waste. When will we realize that a swelling federal government BREEDS waste like rabbits.

Now, I can almost understand the argument from AIG that they were obligated by contract to pay these bonuses which will actually top out at 400 million, and that after all they want to retain their top notch people. I would argue however that given the condition of their company, maybe these people really aren’t that “top notch” and really eliminating some of these people should have been written into the loan agreement in the first place.

Come to think of it, why weren’t a lot of things written into the $173 BILLION dollar loan to AIG? Are you telling me that the average Joe is having trouble getting a $30 thousand dollar loan to buy a car without copious amounts of paperwork, fact checking, and verifications, but our government is willing to hand out $173 BILLION dollars to a company that has a proven track record of mismanagement, without even specifying that certain measures would have to be taken and guaranteed? I would think things like executive pay cuts and rescinding all bonuses until a percentage of the loan is paid back would be REALLY high on the list of things to include?

How can we be irate with AIG with out first being furious with our own moronic and fiscally irresponsible government (not leaving anyone out here, it was the Bush Administration that bailed AIG out)?

Now think about this. We have bailed out AIG, Citigroup, Bank of America, and a host of smaller banks to the tune of a TRILLION dollars or more. Bailed out Freddie and Fannie for HUNDREDS OF BILLIONS of dollars. Allotted $787 BILLION dollars for a ridiculous stimulus package that has no hope of stimulating the economy, in fact would have been more beneficial to the economy in the long term if it were never passed. Signed up for an 8% increase in the federal budget for the rest of the fiscal year. Passed that same budget extension with over $7 BILLION in pork projects.

But OUR President is proposing a plan that will begin charging veterans for medical care through their private insurance.

Veterans, dealing with issues related to their service, having letters sent to their private insurance company for compensation to the VA hospital for their treatment.

All to save $540 MILLION dollars.

Now who is it that we should be outraged at again?

Uh Oh... this is where the bailout stupidity gets sticky

This is a bad idea on SO many levels!

First of all, if newspapers were actually reporting all of the news in an unbiased and legit way, people MIGHT be buying newspapers. Of course, if people can get the same info, in a better format, on-line, then they still may pass. Personally I prefer roaming through the DrudgeReport and a few other sites over combing through a messy paper that is thick with bias and filters the news down to what the editors WANT me to see.

Where does the bailout end?

Hey, the company I work for is leveraged up to their eyeballs and struggling with their cash position... why aren't they getting a bailout?

A bad idea gets better the more money you spend... right?

All of the craziness

While I have been out of the blogosphere for a while, I have not dropped off the map entirely. I have been busy. Crazy busy. Work, home, church… busy. Good busy, but busy none the less. Considering the current economic state of my company, I have recently taken to several job boards and joined linkedin, a career networking site.

With so many things to occupy my mind I have chosen not to listen to too much political commentary, although I have been following the news. I have paid vague attention to Obama’s cabinet selections so far and I have to say that for the most part they are a) not much of a change from past administrations or leadership positions, b) they aren’t quite as representative of the far left as I would have expected in fact some are even pretty moderate, and finally c) many of the positions seem to have been selected because of their prominence in the (Dem) party or for their faithfulness as supporters, rather than for their acumen for the position. Interesting move on Obama’s part. I’m not sure if this is an attempt to solidify his position as the head of the Dem Party and so shore up his influence in the rest of the Dem led government or if this is an attempt at a throw back to what Lincoln did in selecting his cabinet positions. Either way, it is pretty interesting.

The thing that concerns me most about the actions of the current, as well as the incoming administration is the handling of the financial mess. You would think that in any ‘crisis’ of this sort, the first thing that you would do is identify the real source of the problem and address it appropriately. Unfortunately that is not the course of action that Pres. Bush has selected and certainly not the one that the incoming Obama administration will continue. Instead of addressing the problem of political meddling in the mortgage industry and negligence by the SEC, the Bush administration pulled out a trillion dollar box of band aids and started applying as needed. The Obama administration, combined with the Dem congress has indicated that they will super size that box and add in a few rolls of gauze and maybe even some duct tape if things don’t improve (which they are already warning us that they won’t). In the process they are going to show the country that although the Bush administration and their compassionate conservatism (read NON-conservatism) spent money like drunken sailors and increased spending to unrealistically manageable levels in almost every area, the Democrats are the REAL money wasters and government interventionists.

Right now the solution to every financial problem that we have faced is to throw money at it. And if that doesn’t work, artificially lower interest rates and try and get the private sector to throw money at it. At best this will create a temporary and false bubble. The answer is that companies that are not operating in a solvent and efficient manner need to be shaken up. GM needs to go into bankruptcy. The UAW needs to be dismantled or at least completely reformed. If the TARP program is really going to be used it needs to be used in the manner that was intended. If it is just going to turn into a goodie bag for bad companies it needs to be stopped entirely. After the ‘TARP Junk Real Estate Gov. Coorporation’ buys up all of the ‘toxic debt’ that the government originally guaranteed through Fannie and Freddie, then it needs to transition and facilitate the break up and elimination of Fannie and Freddie.

Government needs to get out of the mortgage business. The shares of different industries that we have acquired during this ‘bailout fiasco’ need to be sold off as quickly as possible. Government should maintain the fair practice of business. They should prevent companies from behaving in a way that limits or endangers the free market, but they should have no vested interest in any part of the market. That is not the job of the government.

What we are looking at his a huge deficit that has no hope of turning around. Revenue to the government is going to plummet while the government just increases in size and cost. The answer is to DRASTICALLY cut spending while simultaneously making huge cuts in the tax rates. Yes, this will run a short term deficit, but it will light a fire in the private sector that will be the fuel for a sustained and healthy rebound.

As things turn around continue to cut government spending. Nancy Pelosi recently said that the congress is where businesses come to get a ‘hair cut’. I think congress needs to pull out the Bic and adopt my style of haircut on the federal government.

Pork and Mess in the Bailout Bill

I’ve just been through a good portion of the bailout. What was once 3 pages has swelled to 451 and that is before the House gets to it. New pork and changes could be added then. The actual text of what is set up and established to deal with the mortgage mess begins on page 3. Everything associated with the “bailout”, including regulations, oversight, lots of specific stuff is finished by page 113. A big bill, no doubt. But manageable on it’s own. The other 300 plus pages of this bill are total garbage that has been tacked on. Don’t get me wrong, some of them are good things that we should definitely do, but they should be proposed and voted on as separate bills. The bill writing and amending process has become absolutely ridiculous. We need to be pushing for a huge CONGRESSIONAL REFORM that limits what is included in a bill.

This is atrocious! Call you congressman and complain about that! Go to the websites of the presidential candidates and tell them to push for legislation reform!

If you think I’m wrong, then please read through what is included in this bill. Yes I went through it one section at a time and noted each one for the most part. Some of them were grouped into sections as I got tired, but you get the idea. I’ve put my favorites in BOLD print. Some that were so obscure I couldn’t translate were left in CAPS and are quoted. My comments and section numbers are in parenthesis.

- Tax credits, tax incentives, and bond measures for renewable energy. (Several sections in the 100s)
- Tax credits for steel industry fuel (seems to pertain particularly to coal). (Sec. 108)
- “SPECIAL RULE TO IMPLEMENT FERC AND STATE ELECTRIC RESTRUCTURING POLICY” (whatever that means) (Sec. 109)
- Multiple provisions to modify (from the number it’s a drastic increase) and expand coal projects and credits (Sec. 111)
- Increase in coal taxes to fund a black lung trust fund. (Sec. 113)
- “Special Rules” (I hate that language) to refund coal excise taxes for certain producers and exporters. (Sec. 114)
- Tax credit for “Carbon Dioxide Sequestration” (does this mean I can get a tax credit for planting those trees in the backyard that my wife has been begging me for?) (Sec. 115)
- “CERTAIN INCOME AND GAINS RELATING TO INDUSTRIAL SOURCE CARBON DIOXIDE TREATED AS QUALIFYING INCOME FOR PUBLICLY TRADED PARTNERSHIPS.” (anybody’s guess on the real point of this one) (Sec. 116)
- Investigating the magnitude of the effect of the tax code on carbon and greenhouse gas emissions. (no, I’m serious) (Sec. 117)
- “INCLUSION OF CELLULOSIC BIOFUEL IN BONUS DEPRECIATION FOR BIOMASS ETHANOL PLANT PROPERTY” (I’m guessing this means that people who produce ethanol from other plant matter, like the corn husks can benefit from the same pork that the people using the kernel get) (Sec. 201)
- Tax credits for biodiesel (Sec. 202)
- A clarifier that fuel incentives are designed to increase domestic production. (I guess they couldn’t even figure out WHY they were doing all of this!) (Sec. 203)
- Extension and modification of alternative fuel credit. (Sec. 204)
- Credit extensions for new qualified electric, plug-in vehicles. (Sec. 205)
- “EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING REDUCTION UNITS AND ADVANCED INSULATION.” (Sec. 206)
- Alternative fuel vehicle refueling property credit (I guess that’s good news if you want to open up a 7/11 that dispenses hydrogen) (Sec. 207)
- CERTAIN INCOME AND GAINS RELATING TO ALCOHOL FUELS AND MIXTURES, BIODIESEL FUELS AND MIXTURES, AND ALTERNATIVE FUELS AND MIXTURES TREATED AS QUALIFYING INCOME FOR PUBLICLY TRADED PARTNERSHIPS. (Sec. 208)
- EXTENSION AND MODIFICATION OF ELECTION TO EXPENSE CERTAIN REFINERIES. (Sec. 209)
- EXTENSION OF SUSPENSION OF TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR OIL AND NATURAL GAS PRODUCED FROM MARGINAL PROPERTIES.(Sec. 210)
- “Fringe benefits” to bicycle commuters (you can’t make this stuff up). (Sec. 211)
- Energy conservation bonds (Sec. 301)
- Tax credit for “Nonbusiness energy property” (Sec. 302)
- Tax deduction for energy efficient commercial buildings. (Sec. 303)
- Energy efficient home credits. (Sec. 304)
- Energy efficient home appliance credits (Sec. 305)
- “ACCELERATED RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS AND SMART GRID SYSTEMS.” (my smart reader is telling me this whole thing is a pile of POOP!) (Sec. 306)
- Defining sustainable design projects and green buildings. (Sec. 307)
- “Special” depreciation allowance on certain properties used for reuse and recycling. (Sec. 308)
- “LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS THEREOF.” (Do we want to be limiting deductions on DOMESTIC production? How does this help our dependency on foreign oil?) (Sec. 401)
- “ELIMINATION OF THE DIFFERENT TREATMENT OF FOREIGN OIL AND GAS EXTRACTION INCOME AND FOREIGN OIL RELATED INCOME FOR PURPOSES OF THE FOREIGN TAX CREDIT” (Oh, okay maybe this helps… or not)(Sec. 402)
- “PERCENT FUTA SURTAX.”(I have no idea what a FUTA surtax is)(Sec. 404.0.2 – no I’m not kidding)
- “INCREASE AND EXTENSION OF OIL SPILL LIABILITY TRUST FUND TAX.” (Sec. 405)
- Div. C contains all kinds of individual tax relief, extensions, extensions for business and restaurants. It includes increases in the “cover over” (whatever that means) of the rum excise tax to Puerto Rico and the Virgin Islands. Economic development tax credits for American Samoa. Mine rescue team tax training credit. Different bond measures. Several pork bones to Indian tribes. Railroad maintenance. Katrina tax breaks. Change of tax law for motorsports race tracks (Sec. 317 of Div. C). Tax breaks for investing in Washington DC (Sec. 322 of Div. C). Tax extensions and modifications on wool (Sec. 325 of Div. C)
- Tax breaks for film and television industry. (Sec. 502)
- Some obscure tax exemption for wooden arrows designed for use by children (seriously) (Sec. 503)
- Pages of tax law changes for litigants in the 1989 Exxon Valdez incident, Alaska (Sec. 504)
- Tax law changes for claiming farming equipment as property. (Sec. 505)
- Tax law change on penalties for the taxpayer on understatement of liability of tax payer by tax preparer (my head is spinning) (Sec. 506)

Oh, by the way this was all tacked onto a $3.5 billion measure intended to force health-insurance companies to cover mental illness as they do physical sickness, that included it’s own pork about rural schools, federal land, and national disaster relief.

WHAT A MESS!!!