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  • Morning Bell: Preventing the Biggest Bailout of All

    The bailout parade is continuing unabated in Washington this week. On the heels of a $25 billion bailout for the automotive industry, the Bush Administration agreed yesterday to a $4.3 billion bailout of Massachusetts’ out of control health care spending. Apparently when numbers like $700 billion are being thrown around, numbers like $25 billion and $4 billion begin to sound like chump change. These “crises” all share one thing in common: they all could have been avoided if our politicians made relatively small but unpopular decisions today to avert disaster in the future. This failure is all too common among our current crop of leaders and it is sending our nation straight into a crisis 60 times larger than the proposed Wall Street bailout.

    Imagine a taxpayer bailout even larger than what’s proposed for Wall Street. Now imagine it recurring every year in perpetuity. That’s our fiscal future unless we fundamentally reform Medicare and Social Security. Combined, these programs expose taxpayers to $41 trillion worth of unfunded obligations over the next 75 years. According to the Congressional Budget Office, absent fundamental reform of these entitlement programs we will have to either: A) double all tax rates; B) eliminate every other federal program, including defense and education; or C) run massive budget deficits that would eventually collapse the economy. Every year of delay raises the final cost of reform by trillions of dollars.

    The financial world is watching. This January the international credit rating agency Moody’s said the United States is at risk of losing its top-notch triple-A credit rating. Moody’s lead analyst for the U.S., Steven Hess, told the Financial Times: “The combination of the medical programmes and social security is the most important threat to the triple-A rating over the long term. If no policy changes are made, in 10 years from now we would have to look very seriously at whether the U.S. is still a triple-A credit.”

    Heritage senior policy analyst Brian Riedl says now is not the time to run away from the problem:

    Today we are grappling with a very real financial crisis. While we cannot go back in time and fix it, we can start acting now to prevent the next, clearly visible crisis. It promises to be 60 times bigger than the Wall Street debacle. Is Congress paying attention?

    Quick Hits:

    • According to Rasmussen Reports, just 26% of American adults have even a little bit of confidence that the nation’s policymakers know what they’re doing when it comes to the current problems on Wall Street.
    • New housing reports hint at price stabilization in some markets. Atlanta, Boston, Dallas, Denver and Minneapolis all reported price increases during the May-July period.
    • According to Rasmussen Reports, 45% of Americans say Congress should take action, but 44% say Wall Street and the financial industry should take care of their own problems.
    • Cities, states and other local governments have been effectively shut out of the bond markets for the last two weeks.
    • For the first time since Rasmussen Reports began polling on the issue, more Americans believe the U.S. mission in Iraq will be viewed as a success in the long term than those who do not.
    Posted in Ongoing Priorities [slideshow_deploy]

    27 Responses to Morning Bell: Preventing the Biggest Bailout of All

    1. NLittle, charleston, says:

      Instead of FEDERALIZING the markets, why doesn't Congress give us OUR money — if there really is 700B to give, it must belong to us NOT THEM! — and let us pay our bills and invest — wouldn't that stimulate the economy????

      That Government governs BEST that governs LEAST!

      Stand AGAINST FEDERALIZED ANYTHING/EVERYTHING!

    2. Trudi Padgett, Visal says:

      Two more bail-outs — very disturbing news.

      Please send me information as to where I can locate a listing of the bailout items included in the whole economic package before Congress today.

      I understand they were going to give ACORN a big $$$$ amount. Is this still going to happen????

      I would like to see who else is on the list and what they are receiving. Why have all these 'earmarks' been added to the list — wasn't this only to bail-out the market and Main Street? Why was anything else placed on this ballot?

      I don't understand — and I'm also angry with a lot of other citizens.

    3. Eric Sweeney, Richar says:

      Not meaning to speak out of turn, but…

      Given the events leading to the mortgage crisis, what exactly is a Triple-A rating from Moody's worth anyway?

    4. Edwin Buck, Albuquer says:

      This atrocity of a bill is set up to get these theives in congress's a$$ out of a jam they've put themselves in to. This is so full of pork that they should name it "the oink bill". I'm so sick and tired of these people stealing us blind, that I'm ready to start a revolution.

    5. joe, chicago says:

      It seems to me that a large part of this problem is being totally ignored. The fact is that owning a home became one of the Democrats biggest entitlement programs. Something was terribly wrong with the fact that people could use welfare and unemployment benefits in order to show income and thus use those numbers to justify their ability to pay on a mortgage. We need to hear more about this and more about Franklin Raines and Jamie Gorelick's windfall personal profit while overseeing this 'entitlement program.'

    6. Karen, Florence, MT says:

      If this BAILOUT includes one thin dime for ACORN, we are going to have a revolt in this country. The demorats have driven this country into the ground and into 'socialism, communism'…

      WAKE UP AMERICA!!!! Obama, in Hugh Downs words, is a FLAKE!!! We can not afford a 'NOBAMA' presidency!!! Guess who will be in his cabinet???? Franklin Raines, Jim Johnson, William Ayers and all the rest of his thug buddies!!!!

    7. Duke Lynch Redding C says:

      Make the Social Security Trust Fund into a Portfolio Lender to single family homes at fixed rate 6% 40 years…pay the contributors 5% compounded interest added to each contributor account.

    8. Karen, Florence, MT says:

      I need to make a correction… Hugh Downs did not say Obama is a flake. In an article by J.R. Dunn of the American Thinker.com, published August 20, 2008, Mr. Dunn called Obama a flake. Great article, a must read for everyone. Lays out all the facts regarding 'Mr. Obama'!!!!

    9. Nate, Forestville MD says:

      Reaganomics 11 trillion dollar national debt bill is due. Fact 1980 national debt 711 billion dollars. Reagan to Bush 10 trillion dollars of debt. The market not the american people has decided Reaganomics is dead. Bush the Reagan zealot put the final nail in the coffin.

    10. Duke Lynch Redding C says:

      Notice the Obama campaign is using the exact formula Clinton used about "CHANGE" and the decade of finacial malfeasance with the S&L's in the 80's? Republicans the bad guys!

    11. Son of Liberty says:

      Imagine…

      Wall Street Crashed, Automotive fallout, foreclosed homes. What a wonderful lesson that this country dearly needs!

    12. Jeanne, Limerick, PA says:

      Instead of giving away billions to banks and financial companies, just give each home owner in the country a min. of 250,000 to a max of 1 million and let us pay off our mortgages and credit cards and then these institutions will have money again. The problem with our govt. giving away money is that it also includes "pork" for the senators and congressmen to give to their states. I am tired of my tax money be used to help others when I can really use the help.

    13. alice johnson seattl says:

      Let the bailout happen, only with reestablishing the Usury Laws on the books first. Executive session could do it in hours, if they really want to solve the crises & not have it be a worst problem in another few years. Only federal laws stopping people from taking advantage of less fortunate folks and repeating all this will work, if bailout happens. I personally would like to hold every law maker responsible for the damage if they allow this bailout without federal laws in place.

    14. alice johnson seattl says:

      Let the bailout happen, only with reestablishing the Usury Laws on the books first. Executive session could do it in hours, if they really want to solve the crises & not have it be a worst problem in another few years. Only federal laws stopping people from taking advantage of less fortunate folks and repeating all this will work, if bailout happens. I personally would like to hold every law maker responsible for the damage if they allow this bailout without federal laws in place. Me, small business owner thirty-eight years. Age fifty-nine.

    15. Blair LAW, Ft Myers says:

      Everybody who can think for themselves shoud OPPOSE the Bank Bail-out. Yes they are changing its name and addening "sweeteners" in order to try to fool a few more Legislators, and gullible constituants into thinking that this Bailout is good for America. But it's very flawed. It "saves" some financial institutions that shouldn't be saved, much less tolerated. It employs the "gang from the top" to handle the bailout, as if they weren't instrumental in getting into the mess. Overall it's a sick, sick situation. We should not depend on Big government to rectify this shortcoming of basically private businesses. If we leave it alone ( yes and have the int'l community lose faith for a while), it will sort itself out. WE SHOULD STAY OUT OF IT…(When did we Americans ever see gov't really win one–it's been a long time, hasn't it?) C B L

    16. Pingback: Next up — Social Security « PR on the run

    17. RickFromMichigan says:

      We have the dubious distinction of having Obama visit our city and talk out of both sides of his mouth to cover both sides of his butt.

    18. Steve McHenry IL says:

      This is why our "leaders" are trying to flood our country with uneducated third worlders. Of course the end result of that can be seen today in Europe. Yet, the 539 Fiddling Neros in our Congress will refuse to learn a lesson and our nation will die. Liberals will be the death of us all.

    19. Rob, Utah says:

      The answer to social security is government bonds. We should phase out the payments into social security, which is just a piggy bank for lawmakers to give themselves raises and to justify their pork barrel spending. As part of the phase out, each American worker would use their "old" social security funds to buy government bonds as their future form of social security. For those closer to retirement, the date of maturity would be lessened according to their approximity to retirement. This way, each American is entitled to the bonds with his/ her name on them.

    20. Rob, Utah says:

      In response to the gentleman that claims that Reaganomics is dead; I would like to say that we can't put a price on the end of the Cold War, but President Reagan did. I don't totally agree with all the principles of Reaganomics, but I do agree with supply-side economics. I believe there should exist a little of both, bail-out and free market activity. The "hand" concept by Adam Smith doesn't work fast enough in today's high strung economy, so the government has the duty to "force the hand". We blame government for their mistakes and we claim credit for their successes. A little contrary to the foundations of this country, don't you think?

    21. joseph serulle says:

      what can law abiding citizens do, about this bail out vote?

      I vote against it. I desire for the congress man and women that caused this problem and stole millions of dollars from the people be prosecuted to the full extent of the law. Why is this not been done?

      sign: frustated taxpayer

    22. Brad, Phx says:

      Just a thought: Couple relocates to Phx, AZ at the peak of the real estate bubble. One a business owner the other a college professor. Professionals capable and reluctantly willing to purchase a $850K home in an artificially inflated market. Mr. and Mrs. America now are asked to pay their fair share, (and oh yes the $3000 per person counts EVERY American…..however those poverty level, unemployed, etc. won't be paying, so the real cost will be much more for those employed)of the Bail Out of mortgage brokers that have already made their commissions on the inflated market they created. NOW…….within ten years Mr. and Mrs. America are planning to retire, possibly relocate. The mortgage on their over priced home exceeds its value. Now they realize that all real estate is a risk but the big Bail Out made every else whole. Mr. and Mrs. America have lost the down payment on their home and still owe $250K. Mr. and Mrs American will NOT pay that bill…….they will take what little savings and investments they have and walk away from that home! Does this not put us right back in the same situation?????

      thank you .

    23. Sherry Quick, Orange says:

      Bottom line, it's time for Henry Paulson to hit the bricks and get a job far far away from the Treasury; it's time for the American people to take note of their irresponsible senators and representatives…they need to be voted out of their gravy positions; AND it's time for Freddie Mac, Fannie Mae, and all the other greedy financial institues to stand up and get out of their problems just like We the People do each and every day! Painful, Yes, but not near as painful as the $750 Billion Bail Out with all it's Pork Barrel add-ons will be!!!

    24. IrishEyes2c, Alabama says:

      I think this election will create a civil war in our country, which will be about either race or liberalism. If Obama wins it will be about conservative being fed up with all liberal causes, their tax policies, and over spending issues.

      If McCain wins blacks and some liberals will charge voter fraud, racism and revolt. As time goes on and the deeper we get into this election the farther our points of views get wider and deeper apart. I cannot recall any time in our Nations history where political ideology and the separation between the two parties, is this expansive. Conservative wants morals and values to be returned to this country and recognize religion again. When religion was slowly removed from politics, the guilt that might have been there before was no longer a problem for liberals. I have nothing to feel guilty about my ideas are the right ones. Whatever held them back before no longer exists, they removed it and they are free to deport their policies which include abortions.

      But, they need to come clean and become responsible for the state of our society and its destruction. Liberals have changed everything in our society and none of it is good, at least for conservative. They view themselves as the moral compass of our society that most Americans are discussed with. As younger generations start to age, they become more aware and idolized these liberal democrats. But, they aren’t getting the full picture. Teachers are more liberal, television is clearly liberal focused, and movies are pushing liberal ideas. There is very little concentration of conservative ideas and values in our society. Conservatives has talk radio and Fox News to try to find people who’ll bring focus to our cause. And, Barack Obama wants to put sanctions, laws or total removal of those who are part of the conservative movement and mussel them, remove the outlets and force those same outlets to provide both liberals and conservative points of view. Will he do the same with NBC, ABC and CBS news outlets for conservative? Of course not and we all know this.

      Conservatives can not really get a break anymore, which is extremely frustrating for me and for many of you. Our court system, our entertainment, and our education systems are going farther left every day and conservative’s values are being left behind or eliminated. So, we can fight back by not supporting those who only provided liberal information. Keep our money away from far left entertainment industries. And, we are doing that, where networks and cable stations and their news outlets are all down in the ratings. Americans are becoming more and more angrier every day and liberals still don’t care. I think independents who are conservatives or moderates, and republicans who are conservatives or moderates need to come together and fight back, even if our elected officials don’t want to.

      We need to take back our Country from those who want to destroy it, piece by piece. And the way we can start is by using the tools our founding fathers gave us. They gave all Americans the right to vote, and we should use that to remove the dead weight by slowly removing the damage that liberals created. Remove liberal judges from our courts slowly and replace them with smart, intelligent judges who are either conservative or moderate. Entertainment is a lose cause, but we can hold onto our money and watch them go bankrupt. Remove liberal teachers from our schools, join the PTA in our area and let them hear your opinions and remove liberal school superintendents by voting them out and replace them with intelligent conservatives who focus should be about education instead of liberal ideology.

    25. dave, indiana says:

      I cannot believe that you spineless jelly fish, can even entertain the thought of voting yes on this massive liberal, socialist bail out bill. Grow some testicles, and tell president bush that the stock market can take care of itself. suspend capitol gains tax and lower corporate taxes. if this is such a dire emergency, why did they have time to add so much pork? the stock market will recover unless the government gets involved, their track record isn't all that impressive, I mean, with social security, and everything they have touched that has turned to crap: ie: fannie mae, freddie mac this problem was made by democrats, affirmative action, loaning money to people that could not afford to pay it back. cooking the books to get bigger bonuses. raines made 90 million dollars in 6 years, forcing loan institutions to stop red lines, which means no credit checks. 92% of these loans are being paid back, only 8% are not. so please somebody in washington please do the right thing and vote this down. in closing, somebody show me in the constitution where i am required by law to pay the bill for ignorance and ineptitude.

    26. Don says:

      Unfortunately, success in Iraq is not equal to success in the war against terror. Neither will "success in Afghanistan." We will not win the war on "terror" until we and the rest of the free world wake up to the fact that the enemy is Islam. Islamists, add "radical" if you dare to tempt the PC police, are waging their war militarily, demographically and politically and have already made serious inroads particularly in western Europe. Their goal is to spread Islam throughout the world and reduce all who do not assimilate to a status of dhimmitude, the Islamic word for slavery. While not all of the approximately 1.3 billion Muslims are radicals it is estimated that 200 to 300 million are and repeated assertions in the west that "Islam is a religion of peace" emanates from western religious tolerance and ignores the fact that, unlike Judeo/Christian religions, Islam has major geopolitical and judicial aspirations too. Consider their intolerance of any criticism whatsoever, their not so subtle efforts to implement Sharia law wherever they can, insistence on the acceptance of Muslim dress codes and religious practices, the abrogation of women's rights, honor killings, etc. and their increasing numbers in European countries; England, France, Denmark, The Netherlands, Germany, Australia to name a few. This war is going to go on for a very long time and America and the rest of the free world need to develop a coordinated and far more sophisticated strategy involving world wide intelligence, economic and political approaches in addition to our superb military efforts to ensure that the latter does not end up in the dust bin of history as yet another waste of precious human life. This is a unique enemy, with non-western morals or values, conducting a sophisticated world "Jihad," a war our military is not equipped, structured or designed to defeat on their own. We need to wake up!

    27. Sandra R says:

      Hi! I was surfing and found your blog post… nice! I love your blog. :) Cheers! Sandra. R.

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