Bipartisan Bailout Plan Isn't Playing in Peoria

[padren]

there is no clear consensus that a bailout bill would help, and therefore people don't know how to respond to it.

 

People want the government to be doing something, but there's no clear message on what that should be. Politicians are taking advantage of this, and the result will hurt us.

 

I think there's an emotional factor too - the people don't want the bail out to be an issue, and are angry it is. They are scared of signing off on it and getting screwed, or even having to sign off on it at all, and feel its not their fault - they work hard, why is this even happening? At the same time, a simple "bailout defeated" doesn't solve or alleviate any fears or problems, so simply defeating it doesn't make people feel better either.

 

I think the underlying message is that the public want answers, and plans that can demonstrate some sort of confidence in where we'll be going from here, and none of the representatives are doing anything to provide that.

[ecoli]

because they don't really know whats going on either. I can't think of too many politicians that are also economists.

 

However, economists aren't really coming to a consensus either.

[jackson33]

There is no reason for a consensus to form, while most don't understand just whom or what is being bailed out, or in fact from what they could be bailed from.

 

Fanny/Freddie are GOVERNMENT entities, Fanny set up in 1938 as an Agency in the Federal Government with both being set up in 1970 as privatized government enterprises, under the control of Congress to set up loan standards by any bank or lending agency in the country. There is no bail out possible but an obligation of Congress to correct, take control or figure out a means to convert their responsibility to private industry. Private industry or investors, which bought into the system are failing as well under the weight of bad debt created by falling (deflationary) values and no one is interested in new investments until the floor has been established.

 

The floor can't be established, certainly not by government and the general attitude that those that made loans are somehow going to maintain them in a falling value market with increasing cost, defies common sense, aside from the fact they have or are defaulting. This is not all poor people, but people in all ranges of income who simply over paid for housing. Even if values stabilized, other ownership cost HAVE to increase, to cover loses currently being sustained. Taxes, Insurance, Maintenance are other cost are continuing being paid by somebody or will be due if any one invest in any one property.

 

Many more people who have been making payment, paying taxes and maintain their own property are also being squeezed, probably half the total home owners in this country, at least to some degree. This is where frustration of the general public has come in: Knowing that one person will some how be assisted and knowing that person has already failed and that person will with out question fail again, while they have been paying the price for that one failure, want nothing to do with the next or the one after that...

 

As for the Senate Plan passed and the House expected to vote on Friday, its now 451 pages, with near 300 pages of 'extenders' to grant credit or remove grants (social engineering) or just pork spending, much of which has recently failed for a variety of reason and thought will please specific members of the House. Even the 'raising of National Debt Limits' to 11T from 9.8 Trillion (plus 1.2T) for a 700 Million Dollar plan, stinks with motivational agenda. Its my opinion, this is a massive step into socialism and beyond my understanding why this administration or the Republican Candidate (McCain) apparently have signed on to the plan.

[Pangloss]

Friend of mine just sent me this, it's straight from CNN's web site, though. It's a list of pork items from the bailout bill.

 

Creation of a seven-year cost recovery period for construction of a motorsports racetrack: Track owners currently follow a seven-year depreciation schedule and write each year's depreciation off their taxes. The IRS wanted to increase the depreciation timetable to 15 years, which would mean the track owner's depreciation would be cut in half. The measure in the keeps the seven-year depreciation schedule for two years and would cost taxpayers $100 million.

 

A refund of excise taxes to Puerto Rico and the Virgin Islands for rum: A $13.50 per gallon excise tax is placed on rum imported into the United States. The measure extends to December 31, 2009, a refund of $13.25 per gallon tax back to Puerto Rico and the Virgin Islands, which are both U.S. territories. The refund has been in place since the early '90s. The measure would cost taxpayers $192 million.

 

Income averaging for amounts received in connection with the Exxon Valdez litigation: The measure would allow the plaintiffs who won damages from Exxon Mobile for the oil spilled by the Exxon Valdez to average the award over three years rather than treating it as income in a single year. The measure was backed by Alaska Rep. Don Young and would cost taxpayers $49 million.

 

Secure rural schools and community self-determination program: The program replaces revenue rural communities used to enjoy from the sale of federal forest land. The measure is sponsored by lawmakers from Oregon and Idaho. The program would cost taxpayers $3.3 billion.

 

Deduction of state and local sales taxes: The measure allows citizens who do not pay state income taxes to deduct the amount of sales tax they pay over a year from their federal income tax for two additional years. States that benefit include Texas, Nevada, Florida, Washington and Wyoming. The measure would cost taxpayers $3.3 billion.

 

Provisions related to film and television productions: In order to keep movie production in the U.S., production companies would be allowed to deduct the cost of producing the films from their taxes. Rep. Diane Watson, D-California, has been one of the program's biggest supporters. The measure would cost taxpayers $478 million over 10 years.

 

Extension and modification of duty suspension on wool products, wool research fund and wool duty refunds: The measure helps U.S. worsted wool fabric makers and clothing manufacturers. The bill extends provisions through 2014 or 2015 that were originally sponsored by Reps. Louise Slaughter, D-New York, and Melissa Bean, D-Illinois, in 2007. The measure would cost taxpayers $148 million.

Extension of economic development credit for American Samoa: The measure would extend for two years provisions meant to help economic development in the U.S. territory of American Samoa. The measure would cost taxpayers $33 million.

 

Transportation fringe benefit to bicycle commuters: The measure would allow employers to provide benefits to employees who commute to work via bicycle, such as help purchasing and maintaining a bicycle. The measure would cost taxpayers $10 million.

 

http://www.cnn.com/2008/POLITICS/10/02/bailout.pork/index.html?eref=rss_topstories

[npts2020]

I just finished wading through one of the biggest piles of B.S. ever. After reading every word of HR-3997 or the Economic Stabilization Act of 2008 it seems like the only thing they did was add more spending on top of the already rejected $700B. While the bill has something for just about everyone to like, the totality is the biggest money grab in the history of the planet. What I don't understand, is if the real problem caused by all of this is credit availability, why doesnt the government do the lending on its own through the treasury, small business administration, or some other agency, especially since it is claimed that it is the overnight market mostly that is suffering? If that is in fact the problem, then government intervention should be very short term, a few months and not years. BTW the pork mentioned on the CNN site is only a few things seemingly pulled out at random and does not even comprise half of the giveaways over and above the original $700B.

[ecoli]

/me is pissed.

[Pangloss]

Well for what it's worth I had an interesting opportunity this afternoon. My friend who works for a congressman asked me to submit a written opinion on the bill, and I took the opportunity to point out the potential loophole in the executive compensation issue. I was told that it was bumped up to senior staff, so who knows, maybe we alerted them to something that hasn't been widely noticed inside the beltway just yet.

 

I passed along many of your concerns as well, from this thread. As busy as they are it all probably went right into a recycling bin, but hey, you never know.