Strange Things Are Happening

Isn't it strange that so many people who have jobs and so many of those who don't have jobs seem to support the same political party this year?  Isn't it strange that people who have plenty of money and those who don't have nearly so much seem to support the same party?  And isn't it strange that people who have homes and those who can afford pay on their home mortgages are on the same political side as those who have lost homes and cannot afford to pay on their mortgages?   Something strange and troubling is happening.  

One would think that those without jobs would be thankful that condition have improved enough that their parents or siblings or children still have jobs and, as a consequence, can help them--maybe even provide a place for them to live--until things get better.  It's strange.

Ronald

Let Your Conscience Be Your Guide

October 21, 2010

To:  The Editor

     If you (Texas voters) had to let either Rick Perry or Bill White hold all of the money you possess, and did not intend to count it either when it was given or when it was returned, which one would you trust more to be custodian of this money?  Which would you trust more, Barack Obama or Newt Gingrich?  Nancy Pelosi or John Boehner?  Sharron Angle or Harry Reid?  Your Republican candidate for Congress or the Democrat?  If your plans are to vote for the candidates you trust less, will your conscience have been your guide or will it have died?

     I believe it has not died.  I believe that Republicans will likely take some seats in Congress, not because the polls suggest it is so, but because those who prefer the Democrat's agenda will choose to stay home on election day.  I believe that regardless of what voters have said in the polls, they will trust Democrats more to bring us through to a sustainable economic recovery.  President Obama has even said he will be willing to work with Republicans who may have managed to win only because his 2008 supporters are not so motivated this time.  

     But that cooperation will require that responsible Republicans be elected.  You'll remember, Obama tried to work with the present crop of Republicans with very little success, other than one or two Republican defections on a few very important occasions.  But where voters must choose between broadminded Democrats and Republican ideologues or less, Republican and independent voters (and the American people) would be better served if they helped elect Democrats who are willing to work with Republicans.

     The value of the Tea Party in this year's election is important in that it says to Obama and the Democrats that they have one more chance to get this thing right.  Most Tea Party members are smart.  They know that Republicans don't have a plan to bring about a quick recovery from our present economic condition.  They also know that Republican didn't have a plan to even bring us as far as Democrats have.  How do they know?  They know because Republicans never say specifically what they will do to hasten recovery if they are placed in charge.  Nor do they say specifically what they would have tried in 2009 to hasten recovery had they been in charge.  (Why Democratic candidates aren't emphasizing this on the campaign trail is a mystery to me.)

     The main reason why Republican can't fool all members of the Tea Party is because many (if not most) Tea Party members joined the movement and attended rallies only because they were invited to do so by employers, friends or family members whose invitations they thought they could not refuse.

     The news media and news analysts aren't can't seem to make up their minds why Republicans will or should win congressional seats in November elections.  They vacillate between the notion that Republican will win seats because a lack of enthusiasm by the Democratic base in an off year election and the desire of people polled to have the country move in in a different direction.  Both could be true, but neither might be.

     I don't believe people want a different direction for the country.  They want the same direction:  They want jobs and job security in the America they have known.  Democrats will not lose congressional seats in November because of the votes of the ten percent who are unemployed nor because of the fifteen percent who would like jobs:  Democrats will lose seats because of the anxiety of middle-class workers and the working poor who have jobs but fear they will lose them unless economic conditions improve.  Many of them seem inclined to place their hopes in the change of direction that Republicans would provide.  Many of these voters don't have the time to evaluate track records of political parties nor can they place slow economic progress in a proper perspective when rapid progress is what many people need and everybody wants.

     So Democrats will lose some seats, but not because they should lose them.  They will lose them because the combination of (1) voters who always vote Republican, (2) those who vote always Republican when there is no clear choice or reason not to, and (3) those who can be persuaded by reason, and are somehow are persuaded that Republicans will manage to get it right if they are only given another chance.

     But so much anonymous money has been poured into the campaigns this year to support Republican candidates that the process has been distorted and no longer necessarily nor properly reflects the will of the people.  The people--even those whose party is benefiting from this flood of financial contributions must decide if that's a fair advantage and whether it's an advantage they wish to retain.  A vote for a Republican candidate in this November election will be a vote that elections where outcomes continue to be determined by exorbitance amounts of money from unknown donors.  There have always been people who would not mind this practice.  But that had not be true of a majority of Americans.

    Many of us have already made up our minds how we will vote.  But there is a significant minority who are undecided and will be watching Fox and MSNBC more to help get a closer look at what is true (and claimed to be true) about the two parties and their candidates.  These most conscientious voters will have made the difference during this election.  

    I'm betting that on November 2 voters will prove that the American conscience has not died, that the ways we elect our representatives for government and the ways we pursue economic, political and social progress in the United States will confirm, again, that our sustaining American traditions and our deep-seated American values still matter.

Ronald

     

     

A Grand Partnership for America 2

October 4, 2010

To:  The Editor

     Everybody knows that needed progress on the economy has not been achieved primarily because businesses are not hiring, banks are not lending and too many consumers are choosing to save more and spend less.  Consumers are trying to offset their declining incomes by excessively using credit cards and home-equity loans.  If businesses hire consumers and if they stay hired and are paid equitably with higher salaried employees, these consumers will buy.   And if businesses promise to keep workers hired so long as profits increase, then workers will gradually consume more goods and services if they stay hired and paid equitably with higher salaried employees. even as they pay off debt and save.  

     Also, if people have secure jobs and equitable incomes, banks will be more willing to lend to such people.  If economic conditions warrant them companies would be expected to reduce the number of workers--or reduce the hours worked--and banks would be expected to reduce the number of loans they will approve in light of such declining incomes.  Renters would have an incentives to save so they can make the kinds of down payments that make them better risks in both good and tough times.   

     Some degree of certainly about the job market is necessary, but that certainty should have little to do with extending tax cuts for the wealthy.  When the workforce increases, increased purchasing power increases profits that offset the costs of doing business.  Wealthy investors benefits from rising stock markets and business profits.  Businesses and the wealthy have known for ten years that the tax cuts would expire in January.  Where was the uncertainty?  If our economy system has degenerated to the point where uncertainty renders that system no longer able to tolerate and eventually overcome reasonable risk, then its time to find out why.  

      Republicans say all the economy needs to reestablish that certainty is an extension of tax cuts for the wealthy for at least  two more years.  But if those tax cuts can do that much to help the economy during the next two years, why have the cuts not achieved that during the past two years, or for that matter, the past eight years?  What would wealthy do with their money the next two years that would generate jobs?  And if low taxes for the wealthy is so good for middle-class American workers, why not reduce their taxes for the wealthy to zero?  

      When Barack Obama campaigned about retaining the tax cuts for people earning less than $250 thousand per year, but allowing them to expire for those earning more, Republicans didn't complain.  Obama continued to express that intention after being elected president.  Republicans still didn't complain.  Republicans didn't argue against allowing the tax breaks for the wealthy to expire, even as they criticized all of the President's other attempts to end the Great Recession and establish for the long term a stable, energy independent economy.     

If Republican really believed that Obama's plans would not revive the economy, and that extending the tax cuts for the wealthy was necessary for that recovery, why were they not suggesting that tax-cut remedy much sooner?   

     The fact is that, if Republicans had requested as extenuation of tax cuts for the wealthy too soon, the President would have required Republicans to give Democrats something in return, such as support for a larger economic stimulus package, health-care reform with a public option, and more rigorous legislations on climate change, financial regulations, comprehensive immigration, education reform initiatives, etc.  And the President might have demanded passage of his legislative agenda before the November elections. 

     There had been indications that some kind of tax-cut compromise might be worked out between Democrats and Republicans before the November elections.  But significant political damage had already been inflicted on Democrats by Republicans, who criticized and refused to support Obama's initiatives despite most having had bipartisan input.  When they were not watering down Obama's plans, they were blocking them.   Now they want to compromise.

      One form of compromise would be to make the extension of the Bush tax cuts for the wealthy contingent (1) on Democrats retaining control of the House and a filibuster proof majority in the Senate, (2) on businesses showing good faith by increasing hiring prior to the November elections, (3) on banks promising to lend if businesses hire and (4) on extensions being limited to three-months intervals,  consistent with some prior established bench marks showing more banks lending, more businesses hiring, and more people working more hours with all workers receiving equitable pay rates.   Meeting benchmarks would merit other three- months extension of the tax cuts.       

     Democrats' decision to delay votes on the Bush tax cuts for those making less than $250 thousand per year until after the November elections should have the benefit of getting the base of the Democratic party out to vote.  The base will realize that if Democrats don't win in November with sufficient majority in the Senate, then Democrats, Republicans, nor Independents earning less than $250 thousand a year all will have their taxes go up in January.  And if tax cuts for the wealthy are as vital to economic recovery as Republican claim, then all Republican--even wealthy Republicans--should prove it by supporting and voting for Democrats, 

     At hand is another chance for Democrats and Republicans to work together, this time to establish time frames and benchmarks with banks and businesses that can enhance their confidence in the other, and to allow each to show that such reassurances can actually increase jobs and lending, and hasten economic recovery.

      Middle-class Republicans and Independents who had thoughts of voting for Republicans, and middle-class Democrats who had plans to not vote all but just sit back and continue enjoying their tax-cut extensions should consider changing their election-day plans.  

Ronald

     I was afraid of the boogey man when I was small, though I had never seen one.  I believe it because those whom I trusted told me he existed.  And despite the fact that they did not tell me how he looked or what he would do, for a while the possibility of his existence kept me quiet or in my seat.

     Obama and the Democrats are being portrayed as the bogey man by the real boogie man: Republicans.  Americans have been seeing the boogie man, and the damage he can do, for last ten years.  How could so many people not recognize him?  One reason is because they have the delusion that the boogie man must be black.  I alway pictured him as being black myself.  But if you check throughout history, bogey men have come in all shapes, colors, nationalities and genders.  Most recently, they happen to be Republican.  But the "Republican Tea Party" is saying, no, the boogey man is President Obama.

     Many Obama's supporters also are second-guessing the President on some of the decisions he has made.   Some say he should have been concentrating on the economy instead of health care and financial regulations.  

     Well, what else could he have done about  the economy and job creation?  Republicans and conservative Democrats would not approve a larger stimulus package.  Also, Republicans would have liked Obama to have been devoting all of his time on an economy and job-creation, because they were going to make sure nothing he tried worked.  He would have been criticized by Republicans for not being able to "walk and chew gum at the same time,"  and by Democrats,for acting as if he couldn't.

     Everybody knows that progress on the economy has not been made mostly because businesses are not hiring, banks are not lending and too many consumers are choosing to save more rather than spend too much.  If businesses hire, the people they hire will buy--if they stay hired.  If businesses promise to keep workers hired so long as profits increase, then workers will gradually consume more even as they save.  

     Also, if people have secure jobs, banks will be willing to lend to people with stable incomes.  If economic conditions warrant it, companies would be expected to reduce the number of workers--or reduce the hours worked--and banks would be expected to reduce the number of loans they will approve.  Renters would have an incentives to save so they can make down the kinds of payments that make them better risks.

     But there must be some degree of certainly about the job market.  That should have little to do with taxes.  When the workforce increases, increased spending increases profits that offset increased taxes.  If our economy system has degenerated to the point where uncertainty renders it no longer able to tolerate and overcome risk, then maybe its time to change the system.

      People say all the economy needs is to have the tax cuts for the wealthy extended at least two more years.,  If those cuts can do that much during the next two years, why have the cuts not done anything the past two years, or for that matter the past eight years?  What would wealthy do with their money in the next six months that they did not do the past six month?

      Barack Obama campaigned that he would retain the tax cut for people who earn less that $250 thousand per year, but allow them to expire for those earning more. Republicans didn't complain at that time.  

     Obama continued to express that intention after being elected president.  Republicans still didn't complain.  Republicans didn't argue against allowing the tax break to expire for the wealthy, even as they criticized all of the President's other attempts to end the Great Recession, and establish for the long term a stable, energy independent economy.     

      Which raised the question: If Republican really believed that Obama's plans would not cure the economy's ills, and that extending the tax cuts for the wealthy was necessary for economic recovery, why were they not mentioning that until recently?   The answer: If Republican had requested as extenuation for the wealthy too soon,  the President might have required them to support the implemention of some of his initiatives like a larger stimulus package, health-care reform, climate change legislation, financial regulations, comprehensive immigration legislation, education reform, etc.  He might have demanded passage of his legislative agenda before the November elections, and that they stop trashing the initiatives. 

     There is some hope now that some kind of compromise might be worked out between Democrats and Republicans before the November elections.  But irreparable political damage may already have been done to Democrats.  Republicans didn't help support Obama's programs despite most legislation being bipartisan in their composition.  And when they were not watering down Obama's plans, they were blocking them.   Now they want to compromise.

      Well how is this for compromise?  Make the extension of the Bush tax cuts for the wealthy contingent (1) on Democrats retaining control of the House and a filibuster proof majority in the Senate,  (2) on businesses agreeing to increase hiring prior to the November elections and on banks promising to lend if businesses hire, and (3) on three months extensions of the breaks after January 1, 2-11 producing more bank lending and business hiring, where the number of people working, the numbers hours worked, and pay rates of middle-class workers all increase.   If job and lending increase during the three-month period, extend them for three more months, and continue extending three-month periods every year for up to two years, or so long as there is significant job growth and lending accompany the extensions.

     Delaying the Bush tax cuts for those making less than $250 thousand per year until after the November elections would be an incentive to get the base of the Democratic party off their behinds and vote.  If Democrats don't win, then nobody get their taxes cuts extended.  If tax cuts are that vital to the economic recovery of the country, then Republican need to prove it by electing Democrats, who are the only party that can guarantee extension of the tax cuts since the President is a Democrat. 

      I'm still having trouble understanding how extending the tax cuts for the wealthy will help the economy recover.  But this is a chance for Democrats and Republicans to work together with banks and businesses to enhance their confidence and allow them to show that those reassurances can produce jobs.

      Middle-class Republicans who intend to vote Republican, middle-class independents who intend to vote Republican, and middle-class Democrats who had planned to not vote--and just sit back and wait for their tax-cut extensions-- need to consider changing their elections plans.

Ronald

Who is in charge during economic paralysis?

WHO MUST TAKE CHARGE, IF NOT GOVERNMENT, WHEN BANKS DON'T KNOW WHETHER, WHEN OR HOW MUCH TO LEND; BUSINESSES DON'T KNOW WHETHER, WHEN OR HOW MANY TO HIRE; AND CONSUMERS DON'T KNOW WHETHER, WHEN AND HOW MUCH TO SPEND AND SAVE?

Switching Homes to Address Crisis

         SWITCHING HOMES TO ADDRESS THE HOUSING CRISIS

     Why is it not possible--or of no consequence--to have families move out of more expensive homes which they cannot afford into lower priced homes which they can afford, and that exist within the same general areas or within distances which do not cause an reasonable travel inconveniences and expenses to workers and families?  

     For purposes of illustration, two methods are suggested, using the following simplified numbers and situations representing various home buyers:

    HOME OWNER                     MORTGAGE                              MONTHLY NOTE

               (1)                                      $800,000                                        $8,000    

           

               (2)                                        600,000                                           6,000

               (3)                                        400,000                                           4,000

               (4)                                        200,000                                           2,000

               (5)                                        100,000                                           1,000

METHOD I

     Suppose that home buyers (1), (2), (3), (4), and (5) are in homes they cannot 

afford but can afford one of the lower priced homes listed.  Each homeowner could be allowed to assume the mortgage of one of the less expensive home that the family can afford, maybe the most expensive home the family can afford.  Ideally, (2 )has a home and monthly payment (1) can afford; homeowner (2) pursues the home of homeowner (3); and homeowner (4) buys the home of homebuyer (5).  The point is to get families into homes they can afford at this time.  The home of home buyer (1) could be sold as described in METHOD II.

     All mortgages that are endangered would be identified, and arrangement made, with government help, to work out exchanges among the lending agencies and home buyers.  Government financial interventions may be used, where needed, to expedite the mortgage exchanges.

METHOD II

     Suppose home buyer (1) can no longer afford a monthly note of $8,000 but can afford the monthly payment of $4,000 on house that Homeowner (3) owns.  And suppose Homeowner (3), whose house is paid out, would like to--and can afford to--buy a larger house, maybe the one home buyer (1) or (2) is buying.  Let them switch homes, with (1) now acquiring a mortgage on the home owned by (3), who would use that money paid for his home as down payment on the larger home.     

     Why would these not be possible--and practical--within a defined geographical area? And why might it not be possible even over a wider area if homeowners are willing, and find it to their advantage to travel farther to work if they can keep and live in their own homes?  A tax credit for gasoline and toward the purchase of a new car for transportation might be offered.

     In each case there would be a problem of matching compatible homeowners.  But whatever can be achieved might be worth the effort.

     Something similar happens with renters:  When family incomes become less, families move to apartments where the rent is lower. 

Ronald C. Spooner

Starting Health-care Reform with Blank Sheet

I have tried to figure out what would be the process of starting over in developing a new, bipartisan health-care bill, starting with, as Republicans call it, "a blank sheet of paper." Would that also involve somehow starting over with blank minds.

Every attempt to change or replace an existing program, set of by-laws, or other guidelines for operation, some person or group decides that some process needs to be either initiated or changed. There is seldom, if ever, a group of people assembling to decide what is needed or what needs to be changed.

Now, in the case of Health-care reform, if blank sheet means that nothing has been written down by when those responsible for writing the rules or guidelines, I can understand that. But that would not mean that participants would not have ideas written down in their minds or on their own pieces of paper.

So let's suppose there is a blank sheet of paper on which the eventual plan is to be written, how would the discussion begin? With the chairman asking if anybody has an idea about what needs to be done or how the group should proceed?

Suppose someone suggest that the first item to be discussed in formulating a health-care bill would be those to be covered by the bill. One party likely would support one level of coverage, and the other party another level, especially if party member have previously discussed the matter among themselves. Would such prior discussions be appropriate. One would expect that some prior thought would have been given to ideas before they are recommended for consideration. Otherwise, how would a committee member be prepared to justify the recommendation.

It makes sense, therefore, that each member would come to the committee meeting with ideas and their implementations written down in their heads or on paper. It would help if these ideas were not previously discussed with other party members. Members would them feel less inclined to support ideas simply because the committee member is a member of his or her party.

But that is where the problem lies.