Economy – Bailout – Bust

ONE TRILLION BUCKS AND COUNTING

Hank Paulson, huffing and puffing, sweating and frazzled, convinced Bush, Congress and the public that the sky was falling.  He shouted to the heavens that we had to act NOW or the bottom would fall out.  And so, like the sheep they are, Congress filed into their chambers and determined that the bailout was too simple, not big enough, and hey, this is an opportunity to clean out our desks and get rid of all those old ear marks clogging up our files!

And so the gluttonous sheep of Congress filled the trough with dough and the corporations bellied up to wait their turn for the dole-out.  Paulson, the proverbial fox guarding the sheep, has managed to ‘take care’ of just about all of his Wall Street cronies, bringing a whole new definition to ‘cronyism.’ 

But it gets worse.  Now enters the former Secretary of the Treasury, John Snow, and the auto industry.  We know that the auto industry has a few billion due them in the pre-bailout bailout.  Those funds too have not been released, but before they do, GM indicates it won’t make it to January under the present picture, and has asked for more.  Chrysler too.  And now there is talk of GM and Chrysler merging soon, which would reduce overhead because they would close many plants and lay off many workers between them.

But wait!   Cerebus Capital Management, whose Chairman is John Snow (the former Secretary) has acquired controlling shares of both companies!  Cerebus will fare very well indeed, as have the CEOs of each of the companies in the bailout(s).  While Congress assured us the CEO’s would not get golden parachutes or outrageous severance packages, most of them already got their hundreds of millions of dollars BEFORE this bill passed! 

The bottom line – the bailout has served to swell the coffers of those few and their companies, but it has not stopped the bleeding on Wall Street with investors, nor freed up bank lending, or sparked a recovery in the housing market, or improved prospects for average Joe’s around the country.  Paulson’s crisis call for action can be debated on its merits, but seems that most of America felt him wrong.  Actions since the bailout have showed that it has not helped at all.  We were right, and now we get to pay the price for their collective bungle.

The economy teeters with indecision and anxiety, investors weary and wary.  Likely we have a long haul to some degree of recovery, but it might never happen if Obama has his way.   Socialism will NOT spark recovery.  Rather it will establish a flatlined status quo that we will be forced to accept as the new norm.

Or so it seems to me.

Oh yes and on Pelosi – I think it is important to point out just who she is.  Consider the following:

Speaker of the House Nancy Pelosi’s home district includes San Francisco .
 
Star-Kist Tuna’s headquarters are in San Francisco , Pelosi’s home district.
 
Star-Kist is owned by Del Monte Foods and is a major contributor to Pelosi.
 
Star-Kist is the major employer in American Samoa employing 75% of the Samoan workforce.
 
Paul Pelosi, Nancy ‘s husband, owns $17 million dollars of Star-Kist stock.  As a couple they also own a vineyard  in the CA wine country, a lot of SF real estate and a huge stock portfolio.  She is regarded as one of the most wealthy of all Members of Congress.
 
In January, 2007 when the minimum wage was increased from $5.15 to $7.25, Pelosi had American Samoa exempted from the increase so Del Monte would not have to pay the higher wage.  This would make Del Monte products less expensive than their competition’s.
 
A few weeks ago when the huge bailout bill was passed, Pelosi added an earmark to the final bill adding $33 million dollars for an “economic development credit in American Samoa “. 
 
Pelosi says …Republicans are corrupt .. 
 
She should know.  And she is for the little guy?  Right!

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