Chicken Little: The end is near

It seems Chicken Little was right after all. The sky really is falling...and has been falling for at least six months now. Chicken Little must have known that after 30 years of living like the sky was the limit, eventually it was bound to come crashing down. So he hunkered down and warned us.

We didn't believe. We spent and squandered. Now Washington and Wall Street want us to put up a trillion dollars to bail them out. We have to do it right now because the sky is falling...and quickly. Why are they so pressed? We're the ones with our you-know-what's in the air.

Who’s the real villain in the AIG bonus debacle?

Of course they took the money!

In all the congressional huffing and puffing about the $165 million bonuses given to AIG execs, Congress seems to ignore a basic of human nature: Nobody returns a $6 million bonus check from their boss, no matter how bad the business is doing. Ain’t gonna happen.

That said, I think it’s pretty safe to say that most Americans are outraged that AIG would pay bonuses to employees who engineered the current financial catastrophe. None are more outraged than Congress, however. Legislators, seeking a dramatic demonstration of their anger, are demanding that employees give back the money or have it taxed by 100 percent.

Seems to me that they are punishing the wrong villains. We know the employees don’t deserve retention awards or “bonuses” by any other name, but they were promised and paid.

If you are looking for villains now, how about Congress, who shoveled billions from taxpayer coffers to the banks. This same outraged Congress didn't ask basic questions about whether banks would be forced to actually loan money or if employees could scamper out the door with some of the bailout loot. How about the board of directors and senior management, who approved and disbursed the bonuses while they were still begging America for a handout. How about a Secretary of the Treasury, who had no clue that the bonuses were planned while selling the “rescue” plan. How about a complicit media, who didn’t report on the substance of the stimulus bills but rather focused on who was winning or losing the fight.

None of the true villains want to take responsibility, so they point at the employees who accepted the bonuses rather than the knuckleheads who paid them. Now they want the employees to voluntarily give them back. Who does that? Certainly none of the real culprits.

The $165 million question

What the hell were they thinking?

Sent from my iPhone.

What if the bailout still works without bipartisanship?

Republicans have been trotting around Washington for the last week warning that if Pres. Obama doesn't get bipartisan support for his bailout bill, the president alone will own the results. Republicans will be able to brand the president with the failure, since none of them had a hand in the decision.

Slipping past them, seemingly unnoticed, is the reverse argument. If it succeeds, Republicans would be on the wrong side of history yet again. Not only would they have owned the worst decisions of our generation, but they would be seen as erecting roadblocks on the road to recovery. Someone ought to point out that there's a fair amount of risk in that approach, too.

Sen. John McCain, in a deja vu moment for those of us who were finally beginning to put the campaign behind us, lectured Obama from the Capitol. You might get a bill signed, he warned, but it won't be bipartisan.

The Republican road to victory goes through a little town off the side of the road called Bipartisan. In unison, they've withheld their support from the House bill and all but about three for the Senate bill. The Democrats have the votes to pass the measures, but they won't be able to claim that the victories were bipartisan.

One thing guys...Americans don't need a bipartisan, they need a bailout. When you are drowning, you don't really care if the Coast Guard and Life Guard hold hands when they throw you a life raft. People are losing jobs at ridiculous rates. Families are losing homes. Life savings have evaporated in the market. And it's only getting worse.

Against this backdrop, Republicans think that it is important to hold out and deny the president bipartisanship because if the plan doesn't work, the Democrats alone will own the failure.

Again, another little factoid that slips past them in this argument; Republicans own the current failure. This isn't something we are trying to do; it's something we are trying to UNdo. To say that you can crap all over the place for eight years and tell the new guy to clean it up in two weeks or you own the pile is kind of ridiculous. We all know whose shit we are cleaning up.

All these arguments overlook a very real possibility, however. What if it works?

What if the economy is stimulated? What if people start going back to work? What if the rate of foreclosures stalls? What if banks begin lending? What if they created or saved 4 million jobs? What if any of those things happened? What if they all happened? What if they all happened and the victory wasn't bipartisan? What would Republicans say then? What would they do? I sure hope we have a chance to find out.

Republicans lose in a dramatic stand

This week the Republicans tried to send Pres. Barack Obama a strong message: you might be Michael Jordan, but we're still going to play defense.

Despite personally campaigning for an $819 billion stimulus bill, Pres. Obama could not raise a single Republican vote. In Obama's 244 - 188 victory, Republicans were unanimous in their opposition.

Just eight days after 2 million people gathered in front of the Capitol steps to welcome the new executive, Republicans, in the same building, staged an open revolt against the president's leadership.

To keep my basketball analogies going, I remember a quote that says 'if a guy is coming through the lane scoring on every possession, the next time he comes your way, clean his clock. He'll think twice before driving your way again.'

Bless their little hearts, the Republicans figured they'd make an early stand against the popular president, just to let Obama know Republicans won't be pushovers. They not only played defense, they tried to clean his clock. (Ok, no more basketball analogies.)

A couple issues, however... The bill still passed. As many of Michael Jordan's opponents learned, playing defense wasn't enough to ensure a win. (Ok.. ok... I couldn't resist one more.)

One other thing... they were opposing solutions for the future with arguments from the past. They opined that the bill consisted of wasteful spending rather than tax cuts. Once again, they told us that only tax cuts will rescue us from this disaster. The danger is in including unemployment insurance for all those Americans who lose their jobs in this economy. We don't need social programs. They are only a drag on the American economy.

Is it just me, or haven't we heard these arguments before? Isn't this the vehicle that took us straight into this ditch? Didn't Republicans promise us that a sole diet of tax cuts was the path to financial health? And didn't it end in the spectacular failure we now endure?

If we learned anything during the last eight years, it's that the Right won't be deterred by reality as long as they clutch to their core "principles." Slogans over substance all over again.

Here we are...a tad more than a week after a resounding repudiation of those "principles" and Republicans are still resisting based on the same failed theories.

Sometimes I'm glad they don't learn from their mistakes.

Bail out for porn? Come on...

Times are hard in the porn industry. They are so hard that Hustler publisher Larry Flynt and Girls Gone Wild CEO Joe Francis are planning to ask Congress for a $5 billion bailout of the adult entertainment industry.

"With all this economic misery and people losing all that money, sex is the farthest thing from their mind. It's time for congress to rejuvenate the sexual appetite of America. The only way they can do this is by supporting the adult industry and doing it quickly," said Larry Flynt.

I know... Congress will say this is too hard to do. This won't stimulate the economy, and the American people will have no desire to bail out porn. The thought will be enough to make your head throb. We'd rather go about life carelessly blowing Bubbles. But we must do it. We must bail out porn.

Think of the impact if we don't act. Men will be forced to look at their own wives. Wives will have to fend off increased advances from other women's husbands. Camcorder sales will increase dramatically. Children will wonder why their parents now go to bed so early.

Well the porn industry won't take this lying down. They refuse to swallow their pride and let the the economy stick it to them in such an impersonal way. After all, why should porn be brought to its knees? Congress will have to enter this debate, or the American people will get screwed.

Could this all be true, I wondered? I was getting all riled up when the thought occurred to me that this might just be a stunt. Who cares, though. If we can spend money to bail out crappy Chryslers, surely we can lend porn a hand.

Congress, cut em the check. Keep it coming, Larry.

When you wish upon a czar...

...makes no difference who you are

anything your heart desires

will come to you
-Peter Pan

I'm not sure who wished for the car czar first, but I'm willing to bet they won't get their heart's desire. I'm not expert in these things, but it just strikes me as a bad idea.

I'm going to sound Republican here, but stick with me. One of the follies of government is that it thinks it can fix everything itself, and two of Washington's favorite fix-it remedies are the commission and the czar. One buys time, and the other shifts accountability. Both tend to waste time and money.

The latest fix for the car industry is that we hand them a $14 billion check (the term officially morphed from bailout to bridge loan) that will come with a nanny to help the car companies make better decisions. No one can argue that automakers have some serious decision-making challenges...after all, these are the guys who make cars so crappy that they didn't even want to drive them to Washington. Only when they thought $25 billion...oops, I meant $34 billion, was at stake did they buckle up for the road trip. I'm not mad at them. It'd take about that much to get me to drive one, too.

So these guys who stunk at making decisions and drove their companies into the ditch, now beg us for a bailout, I mean bridge loan. We can't just hand them the money. We need some checks and balances. We need.... A CZAR. Here are four problems with the czar idea:

1) No business in government: Government doesn't think or operate like the private sector. Like it or not, the engine of business is capitalism. Companies are driven by competition and profits. We measure success by money and stock value. That's it folks. There is no other real report card for business as a whole. Government doesn't think that way. They are egalitarian. They are looking out for the greater good. To make everything right for the taxpayer. To establish justice. To ensure domestic tranquility. To provide for the common defense. To raise their poll numbers. Chrysler has a different agenda; they want to kill GM. They don't want the same opportunity as their competitor. They want a better one. That's the nature of business, and government doesn't get that. That brings me to my second reason.

2) The friend of my enemy: This one czar will open up the books of both companies to decide who needs and gets help...or how they should negotiate deals..or restructure loans?? That ought to make them both shudder. Companies guard their inner workings like Fort Knox because a leak in their strategic direction or technologies can set them back years in market share and profitability. Now you'll have the same guy/office poring through your books as well as your competitors. Can you ever trust that process, no matter how much they say it's safe? Did the mob ever trust the witness protection program? I know the government is there to help but please... That brings me to the third reason.

3) Money where your mouth is: The czar has no real stake in the outcome. Other than being able to add "successful car czar" to his or her resume, there will be no lasting impact like his job lost or her stock value plummeting. If the whole experiment fails, the czar will write a book and go nurse his or her credibility back to health in a think tank. People who were at his mercy will languish with the results. If you want to call the shots, you need some skin in the game. That brings me to my last reason.

4) It's not who you know, it's what you know: Will this person be required to have auto industry experience? What metrics will we use to determine Mr. or Ms. Czar's success? Do you really want the same guy who picked Mike "Brownie" Brown to run FEMA choosing someone to navigate Detroit through its storm? Would you be more inclined to buy a car from a Detroit company because a Washington suit was calling the shots? I think we all know the answer to that one.

Now you're thinking...we just can't hand money to auto execs with no accountability, can we? No we shouldn't, but accountability doesn't require us to micromanage the process. When a bank loans you money for a car, they don't send someone to the car lot with you to make sure you don't by a Buick with high mileage, but when the transmission falls out, you're on your own.

A guy named Arnold Berk spent $15,000 of his own money to place an ad with his proposal for "A Contract between Main Street and Wall Street." He has a couple provisions that tie very real accountability and consequences to any government help. Here's my favorite:

The CEO and top 25 officers must pledge their personal real estate as collateral for this loan. This includes property held jointly with spouse. Their principal residence as well as any other real estate they may own as an individual or with spouse.

No need to hire a czar when a guy's house is at stake. Now that's not just accountability, that's motivation. Go ahead and fly to Washington while we measure for drapes. You think that would get their attention?

But... we wish for a czar to build our cars. As one analyst commented, "that only delays the funeral."

If your heart is in your dreams
No request is too extreme
When you wish upon a czar
As dreamers do
-Peter Pan

Brother, can you spare a bailout? A conspiracist’s guide to the current crises

The line is beginning to form for those taxpayer bailout dollars. You mean you haven't heard? Say your business or industry isn't going very well. You're on the verge of losing everything if you don't do something drastic. What do you do? Let things go south and head to the government for a bailout.

It worked swimmingly for the banking and investment industries. They were on their way down the tubes. They weren't running out of money, mind you. They had plenty of cash, but we had a crisis looming they told us. Our homes were losing value, said the banks who helped determine the value most of them. Our stocks were going south, said the investment community who administered them. We don't have the confidence to loan to each other, said the banks who controlled loaning decisions.

What we need is cash, they gravely intoned. Lot's of it. Your cash. We won't lend you money, but we want you to lend us some. What a great idea! And so Congress, who funds their campaigns with donations from rich people like bankers and stock brokers went along. Things must be fixed. A crisis like this deserves all our attention, they cried in unison. More rapid than eagles, the statements they came. They forecast the doom and decried the shame.

The masses panicked on cue. Yes, give them our money, so they might loan it back to us. Write them a check with no collateral after they squandered theirs in a dramatic display of fiscal irresponsibility. Yeah. Let's give them $750 billion. Wait, they need $250 billion more. They couldn't have really asked for a trillion, could they? That would choke even the most concerned observers. How about we get that trillion it in two easy payments?

Whoa! The auto industry said. You mean you can run your industry into the ground and get some bailout cash? We want some of that action. Quick, let's don our long faces and swoop into Washington. How brilliant of us. Sure congress will initially castigate us and our management ability, but how bad can we be if we can score some of this cash. We'll then collude with the banks to charge high interest rates, and we can both make back this money and then some. Sweet.

But the knucklehead auto industry execs couldn't even get the begging right. We all had a good laugh that they flew into town on corporate jets whisking congressional testimony that told us how the bankrupt and begging companies had been so well managed. They make great cars. They have savvy managers. They employ efficient workers. It wasn't anybody's fault. Nobody in Detroit, anyhow.

Then they slipped congress the ransom note. Give us the money or the Detroit workers get it. Congress considered the demand but quickly realized they should feign some level of outrage and concern. Lawmakers sent the execs back to Michigan with some homework. Come back in December and bring us some political cover for goodness sakes. Do we really need to explain that to you?

The airline and travel industries looked on, green with envy. Our industries are going broke, too. We employ lots of Americans, too. Let's see what happens with the Detroit brethren. In the mean time, somebody write a ransom note.