Why no bailout for California?
Perhaps it's because I don't live there anymore, but I'm amazed by how little attention this has received - so I could be wrong and maybe it's receiving plenty of attention. While many, I think, agree that CA should not get a bailout (and I'm not saying either way; that's not my point in this entry) I'm wondering why the inconsistency in logic and policy has not been discussed. Here's what I mean: we've bailed out financial firms for instance because they were "too big to fail." As one of the largest economies in the world, wouldn't you say "California is too big to fail?" So why has the Obama administration chosen to give a firm no (the political equivalent to the "bird" - aka, middle finger) to CA? It further boggles the mind when you realize how much the administration has helped businesses, including nearly socializing the auto industry (instead, he gave it over to the corrupt labor unions). Indeed, the Obama admin's budget is enormous! And people are just now, according to polls, starting to lose faith in Obama over policy (whereas before, though a majority disagreed with his policies, they still gave higher approval ratings). Wow.
Let's face it, America; the US government is corrupt. Both parties are corrupt. Democracy - all around the world - is being trumped by powerful interests. Democracy the world over is failing - powercrats have seized control: leaders in business, special interests, lobbies, unions, propaganda houses, religious groups, you name it because everyone wants a share. Government is the biggest business and propaganda organization there is; each government the world over is inflating itself by giving itself more money, more power, more control over press, and sending its propaganda - all of them. The common person has little political clout and losing more each day; so yes, many play the game and try to get some slice of the pie, but even when you get a little larger one - at what cost? You might get a few bucks for an arm, a leg, and your children's financial future and I'm serious. A little extra now for a lot of cost down the road; it's like using a credit card to buy a $100 item. After TRUE interest is calculated - which includes if you only paid the minimum payment - you could end up paying $300-1000 for that because you can literally pay hundreds (100s!) of percent of interest over the lifetime (decades) it took for you to pay it back! With each little step like this, the people are losing more and more power the world over. As an aside, I mean how could Iran have counted so many PAPER ballots in hours? It's obvious there was fraud, but "what can be done?" It's that apathy that allows it!!
When the US government panders to business and when both parties are funded by the same organizations, you should have a big alarm bell ringing. Seriously, I've said this time and time again: follow the money (government, media/press, business, etc). So why is CA not being bailed out? Simple, it's more profitable for the state budget to fail. In fact, I would not be surprised if that were not a goal - if not back-up plan - of the Obama admin on the federal budget. Bankruptcy is a powerful tool that many of the wealthy know how to leverage. Did you know that? Yes, if you know how, bankruptcy can actually help you not only to get out of debt, but to help you on a way to wealth. It's not so much the process or bankruptcy itself, as it is being able to risk money, lose it, and then not have to pay it back - as long as you can keep your assets safe (which is why smart investors don't risk their money, they risk imaginary money: seriously). So run up a massive debt and let your investors take the hit - but not the powerful ones (like foreign governments or business), but the people: the masses, you and Joe Shmoe taxpayer. What the media doesn't tell you is that the massive, record debt is not so much China's bill, but yours. Don't worry China, I'm sure the American people will foot your investments too since we couldn't risk angering you!
Consider the CA situation again specifically. Within 2 months tops, there is no solvent budget. That means no (or less) money will be going from the state to certain programs, funds, institutions, county/local governments, and possibly for welfare programs (hopefully you are not unemployed or disabled!). Currently, federal regulations prohibit a state from declaring bankruptcy. And no matter what the state does, there's no resolution on the table - or even on the horizon - that would not only 1) solve the massive crisis, but also 2) pass the state legislature (where neither Dems or Repubs will work with each other and instead play politics while the people are going to suffer; neither party has your interest at heart - their main interest is power and in how many seats and who among the party leaders will have those seats). So what happens to CA? Well, for one the credit agencies get to massively charge CA and downgrade their credit score, inflicting more penalties, higher interest, and CA will have a harder and more expensive time getting credit in the future. This means you, the taxpayer, get to shoulder more burden for the state for many years to come while the credit agency and the lenders/investors get to make money off you. Sure, they will junk their bonds and other holdings now - they have in fact been selling them like crazy - which means that even if the Obama admin wanted to help CA, it would be like throwing money down the drain. The investors won't buy them anyway. But someone is! Essentially you. The problem is, it's the savvy investors and insurers who will get their money back by having you pay for them (those people who buy cheap today and hold on to them for many years until they eventually get 100s of times their investment - a huge ROI). You pay, someone else will profit years from now. Fun right?
And of course, no one is talking about it like this. Why? Well, first of all, most people aren't interested in, let alone educated, on economics. And second, do you really think the media and the Obama admin or CA want you to know what's really going on? Even if you agree with partisan politics and their opinions, it's all blaming and anger: not resolution nor a real discussion on the problem (rather just "who to blame" when the problems and causes are more of the point). If people riot when the Lakers win for goodness sakes, what do you think they'd do if they found out what's happening: how they are being lied to, manipulated, cheated, used, and stolen from? Besides they'd say, no one knows what will happen. Economics is all prediction that's primarily based off the faith of the people in the economy. That's why it's not a science; it's too tied in with sociology and psychology. So it's true, no one really knows what will happen. Everything could keep going "just fine."
I don't know what will happen even though I spent years studying economics and worked in the banking and lending industry; and I could be wrong in my perceptions. But I can try to give you insight into why. And it baffles me that people act like, "well, there's nothing we can do." Apathy is the single most deadly attitude towards democracy. It allows tyrants and bully's to beat you up, take your lunch money, and do with it as they please. Sure, they're the popular kids and they're nice to their crowd, but you know they pick on you - and you know they don't really give a rats ass about anyone but "number 1." So you go eat in the corner and watch them throw food around the cafeteria like it was paper, laughing the whole time. If you don't want these bully's picking on you anymore you don't even need to fight back or take a stand by yourself. All you need to do is go around to the majority - like you - and refuse as one. 20 people will not try to beat up a massive crowd. Sure, if you stand up by yourself, you might get beaten and starting a fight isn't going to help anyone. If you didn't get that analogy, I mean this: "VOTE!" Vote out the corrupt politicians, stop spending money at businesses that are benefitting from your rotting corpse of a bank account, and disband from lobbies and special interests. And please seriously, no rioting or violence: that would make things worse for everyone and wouldn't necessarily change anything anyway (it usually causes the same messed up system to rise out of the ashes! If only more people cared for and learned about history and not online, but from books and multiple/conflicting sources!). The minority who have the majority of the money only have it because you freely choose to give it to them (albeit, you've been lied to, manipulated, and frankly have way too much other crap going on to probably be able to really investigate this for yourself).
Obama's admin is no agent of change. Well, let me rephrase - not in the ways you wanted. Rather, he's going forward with what all US admins have done which is take more power for the Executive office and government, spend more money, rack up an ever skyrocketing debt, and continue to be so inconsistent (for example, N. Korea can't have nukes, but then Obama says that he can't stand in the way of a sovereign nation - Iran - from pursuing it! What?!) that I seriously wonder how people don't immediately see the corruption? Oh, that's right, because you're given 2 - sometimes 3 - points of view in the news media; and it's all meant to make you angry at the "other." It's all blame-game politics. Wake up, America. Forget your talk show & news commentators - all of them. Its time you flex your power. While the ultimate power is in paying taxes, the next best things again are: vote out all these bozos, write letters or stop dealing with certain businesses & lending institutions that are taking your money, and stop donating to lobbies and organizations. Bring back power to the people, not institutions.
Posted by Shomer Tiferet at 18 Jun 2009, 7:14 AM 
Categories: Solutions,Politics,Economy,Liberty,Consumerism
Categories: Solutions,Politics,Economy,Liberty,Consumerism
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