Pigs eating at the government trough

Listening to Fed Chairman Ben Bernanke talk to the Congress is like listening to a used car salesman trying to sell someone an untested used car the consumer does not need.

Treasury Secretary Henry Paulson sounds the same way. These two unelected bureaucrats have never found a problem they did not think they could solve. Their hubris has no limit.

Their friends on Wall Street call Ben and Henry and say, "The economy is going in the tank unless 'YOU' do something." So Ben and Henry saddle up and get on their white horse and start the ride to make their legacy one that will be remembered and talked about in all the future economic classes where monetary "theory" is discussed ad nauseum.

It is amazing that King Henry Paulson wants to print money the taxpayers will pay for later to buy mortgages from his friends on Wall Street that his friends cannot sell. Paulson thinks he can get the mortgages for 60 cents on the dollar and make money for the taxpayers by holding these mortgages until they are serviced later when the economy improves.

Why does Paulson think these mortgages are worth 60 cents on the dollar? Maybe they are worth only 30 cents on the dollar. If they are worth anything the market will buy them. The problem is the sellers of these "Junk" mortgages, some call them "Sub Prime", want a higher price than the market thinks they are worth. Who else to go to than the government feeding trough when you want something for nothing.

Paulson was the Chairman of Goldman Saks in 1999 when the Glass-Segal act was changed. The Wall Street crowd lobbied for this. They lobbied for easy credit to unqualified home buyers so the bankers could sell the junk mortgages to firms like Goldman Saks so they could sell them to your IRA managers. Now he wants us to believe he can solve this problem.

Chairman Bernanke was correct when he said the economy might go into a recession and cause government tax revenues to shrink. This is what they are all concerned about in Washington, D.C. If tax revenues shrink, the pigs feeding at the government trough will have to look for food elsewhere. The pigs will be angry if someone does not feed them.

One of the biggest enablers of the drive to bail out Wall Street is the media. Newspaper and TV news conglomerates get their revenue from advertising. They are already hurting from the Internet competition. If there is a recession there will be less advertising revenue for the media. This is why you hear pundits that work for the media calling the bad financial investments by overpaid Wall Streeters, a "crisis". If the media and other businesses' profits decline, their pay bonuses will disappear. To these senior executives this is why they are frightened, and why they try to frighten us with words like "collapse".

CBS evening news anchor Katie Couric asked VP Nominee Sarah Palin if she thought there was a risk of the U.S. facing a "Great Depression" if congress does not act. Palin answered, it may.

The U. S. economy is a 14 trillion dollars economy. The financial crisis will take 10% out of the GDP. This will leave an economy of 13 trillion dollars and millions of people working.

If the government really wanted to promote the economy, during the next two years they should; repeal the minimum wage laws for any new hire, repeal all EEOC rules, eliminate the employer's share of the payroll tax for the new hire, and eliminate any EPA or OSHA rules for any new business.

The States and cities can expand the economy if during the next two years they will remove all licensing requirements to start a new business.

When people blame the free market for the financial crisis I reply, "There is no free market to blame. The market is too regulated to be called free."

Warren Buffet said to invest only in something you understand. I doubt if congress understands what they are buying. Of course they are not using their money. They are using your money. If it goes bad the most they will lose is an election, where they will collect a nice retirement check and take a higher paying job with somewhere within the kleptocracy.

God bless the Federal Reserve and the U.S. Treasury.

Rapture me up, Scotty!

Charles Tolleson