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International Seeds Day April 26, 2009

Posted by Daniel Downs in corporations, farms, free market, justice, news, politics, science.
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Organizations, activists and people from various professional and linguistic backgrounds will observe April 26 as International Seeds Day (ISD) advocating for patent-free seeds, organic food and farmers’ rights. ISD will be an educational day for the public to learn about genetically modified food and its health hazardous effects and the agribusiness of major US and European companies and their monopoly over the agriculture in Africa and Asia with emphasis on India, Iraq and Afghanistan. It will be a day of solidarity with farmers in countries devastated by war (Afghanistan, Iraq & others) and of resistance.

Why April 26?

Order 81 was signed on April 26, 2004 by Paul Bremer, the administrator of the Coalition Provisional Authority (CPA) in Iraq to control Iraq’s agriculture. The Order was a declaration of war against farmers. Article 14 of this law states “Farmers shall be prohibited from re-using seeds of protected varieties,” Order 81 mends Iraq’s original law No. 65 on patents, created in 1970. The most significant part of Order 81 is the subject of ‘Plant Variety Protection’ (PVP), which ensures not the protection of biodiversity, but rather the protection of the commercial interests of USA and European major seed corporations. In order to qualify for PVP, seeds have to be ‘new, distinct, uniform and stable’. Therefore, the sort of seeds being encouraged to grow by corporations such as World Wide Wheat Company (WWWC), Monsanto and others will be those registered under PVP. (Go to a href=”http://www.ineas.org/events.htm target=_new>http://www.ineas.org/events.htm for more info.)

Why Scientists Are Against GMO Seed Patents

The following statement was submitted by 26 leading corn insect scientists to the EPA protesting the problems created by allowing corporations to patent genetically modified food sources. These scientists, who work at public research institutions located in 16 corn producing states, represent all scientists have participating in federally recognized research in solving pest problem related to insecticides and other related issues. There independent research intersects that of international seed manufacturers promising seed products that reduce or eliminate the need for externally applied pesticides. The problem scientists have with international seed manufacturers is explained below:

“Technology/stewardship agreements required for the purchase of genetically modified seed explicitly prohibit research. These agreements inhibit public scientists from pursuing their mandated role on behalf of the public good unless the research is approved by industry. As a result of restricted access, no truly independent research can be legally conducted on many critical questions regarding the technology, its performance, its management implications, IRM, and its interactions with insect biology. Consequently, data flowing to an EPA Scientific Advisory Panel from the public sector is unduly limited.”

A more fundamental problem identified by the Institute of Science in Society is the effort of corporation to gain complete control of science. Our governments allowing them patents is more evidence that government are partners in their monopolistic agenda. (see ISIS article Corporate Monopoly of Science)

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Financial Bailout Alamode Topped with History and a Dash of Sarcasm April 23, 2009

Posted by Daniel Downs in economy, finance, free market, government, monetary policy, news, politics.
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In typical style, Bill Bonner, chef of The Daily Reckoning, serves us a tasty dish of bailout alamode seasoned with historical perspective and sprinkled with just the right amount of sarcasm.

______________________________

The year of our Lord 2008 died in disgrace. It was tossed in a hasty
grave…and mud was thrown on its face as though on a dead dictator. ‘Good riddance’ says practically everyone. But here at The Daily Reckoning, we’re going to miss and mourn it. It may have been the worst year in stock market history, but we can’t remember when we had such a good time. We barely broke a sweat the entire year; never were there more jackasses to laugh at or more con artists to admire. So, today, we hang black crepe…spread tea roses…and bid adieu.

Among the other milestones of 2008 came word that 1 out of 100 adults in the USA was in prison; but as the year progressed, that seemed like hardly enough. Each week brought new evidence that there were still many miscreants who should be behind bars. On January 11, 2008, when one of the nation’s biggest mortgage lenders – Countrywide Financial – went bust. On February 17, Britain’s Northern Rock was nationalized. Still, America’s rulers missed the calamity taking place right under their noses.

“I don’t think we’re headed to a recession,” said George W. Bush. “I don’t think I’ve seen any scenario where the American taxpayer needs to be stepping in with more taxpayer dollars,” added Henry Paulson. Then, on March 11th, the Treasury Secretary went on to explain that the fallout from sub-prime mortgages was “largely contained.” From the report in the Wall Street Journal:

“Paulson, a former chief executive of Goldman Sachs Group, repeated his view that the U.S. economy is fundamentally on sound footing and would dodge a recession.”

The very next day, Bear Stearns CEO Alan Schwartz told the world that his firm faced no liquidity crisis. In an exclusive interview with CNBC, he said the nasty rumors were unfounded: “We finished the year, and we reported that we had $17 billion of cash sitting at the bank’s parent company as a liquidity cushion,” he said. “As the year has gone on, that liquidity cushion has been virtually unchanged.” That same week, SEC Chairman Christopher Cox added that his agency was comfortable with the “capital cushions” at the nation’s five largest investment banks.

Four days later, the cushions seem to have mysteriously disappeared. Bear Stearns, faced bankruptcy brought on by collapsing sub-prime prices. In a desperate measure, the firm sold itself to J.P Morgan the next day for $2 a share – a 98% discount from its high of $171.

But by May things were looking up again. On the 6th of the month, Cyril Moulle-Berteaux, managing partner of Traxis Partners LP, a hedge fund firm, wrote in the Wall Street Journal: “…it is very likely that April
2008 will mark the bottom of the U.S. housing market. Yes, the housing market is bottoming right now.”

But by July, several things were clear: housing had not bottomed out, the subprime problem was not contained, the banks did not have enough cash, and every official – public or private – who opened his mouth was either a joker or a thief.

On July 16th Fed Chairman Bernanke told Congress that troubled mortgage giants Fannie Mae and Freddie Mac were “in no danger of failing.” The next day, ABC interviewed Fannie Mae CEO Daniel Mudd. Would Fannie Mae need a bailout, he was asked. “I think it’s very unlikely,” was the opinion of the top man. “ And I think everybody that has described it… [says it’s] a backstop in case things turn out different than everybody predicts.”

If anyone knew what was happening in the nation’s housing market, he
wasn’t sitting in the CEO’s seat at Fannie or the Fed. By September,
things were turning our different than everybody expected. On the 6th, the US government nationalized both Freddie Mac and Fannie Mac, wiping out the shareholders. On the 14th, Lehman Bros. went broke. Lehman’s main man, Dick Fuld, blamed the few people who actually seemed to know what was going on – those who sold the company’s stock: “When I find a short-seller, I want to tear his heart out and eat it before his eyes while he’s still alive.” The day after, Merrill Lynch ceased to be an investment bank; it was taken over by the Bank of America. And the following day, the Fed bailed out American International Group Inc in return for 80 percent stake.

But by the middle of September, the financial authorities – who neither
saw no evil nor heard any – were on the case. On September 18 the UK Financial Services Authority took the Dick Fuld approach; it banned
short-selling financial stocks. The next day, US Treasury Secretary
Paulson took aim at the problem he never saw, calling on Congress to ante up $700 billion. Whence cometh the $700 billion figure? “It’s not based on any particular data point, we just wanted to choose a really large
number,” said a Treasury Department spokeswoman.

Besides who had time to look for data points? “If we don’t do this, we may not have an economy on Monday,” said Ben Bernanke to the U.S. Congress. Mr. Bernanke was as wrong about that as about everything else. Monday came. Monday went. The economy never seemed to check its agenda. But then, the U.S. House of Representatives rejected Paulson’s rescue plan and stock markets all over the world crashed. The Dow Jones posted its largest point decline ever. “I believe companies that make bad decisions should be allowed to go out of business,” opined George Bush.

By early October, however, the world’s rescuers had their defibrillators
plugged in; Congress approved the acquisition of up to $700 billion of
Wall Street’s toxic assets and the UK government announced 400 billion pound bank bailout. “We not only saved the world…” began Gordon Brown’s victory speech, before he was drowned out by howls of Tories.

“I got to tell you,” said Paulson on November 13th “I think our major
institutions have been stabilized. I believe that very strongly. “ Two
weeks later, America’s largest bank and its largest automaker were on the verge of bankruptcy.

By yearend, the thieves had been blown up by their own debt bombs and the jokers were in control of most of America’s major industries – housing, autos, banking and finance. “…The lack of specifics [in the bailout legislation,” explained a Bloomberg report, “ gives President-elect Barack Obama plenty of leeway to decide who succeeds and fails…”

And as 2008 began its death rattle, America’s president managed to capture the zeitgeist of the whole remarkable period with just a few flagrantly absurd bon mots: we had to “abandon free market principles to save the free market system” said he.

Au revoir, 2008…sniff, sniff.

______________________________

To indulge in other tasty treats served by Bonner, visit the Daily Reckoning.

SCHIP : A Springboard to Fixing Our Political Economy January 14, 2009

Posted by Daniel Downs in children’s health care, Congress, Democrats, family, free market, justice, monetary policy, moral virtue, news, political economy, politics, Republicans, SCHIP, taxes, welfare, work.
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In a press release issued today, Republican Whip Eric Cantor offered to work with Congressional Democrats and President-elect Obama to revamp the State Children’s Health Insurance Program. He called on Dems to help the nation’s families provide quality health care for their children.

Seems like a reasonable goal that all people of all party affiliations could support, right? The problem is Democrats and their leaders promised to improve the middle class welfare prospects. That is what the conflict between the two parties has been about. Republicans like Cantor want to restore SCHIP to its original purpose: help low-income families who can’t provide health care for their kids–not adults, not middle class workers, nor anyone who already has insurance.

Now would be a good time for Dems to stop trying to make all Americans dependent on the federal government. They could do us all much good by actually fixing the political economy rather than stimulate to death.

The economy is already a rule based human activity of we humans. The first rule of Constitutional governance is less government is more liberty for everyone. This translated into terms relevant to a political economy means less bailout and more free market behavior. As financial advisors like Bill Bonner of Agora Financial, keeps saying, you can’t correct a credit/debt crisis by adding trillions more of the same. Can you help an obese man by giving him another helping of dessert, or cure an alcoholic by offering him free drinks? Of course not. The same applies to overspending, too much debt and bad credit.

In one sense, the underlying problem of the current economic depression is a moral one. More economic liberty without moral virtue regulating it produces much irresponsibility and corruption, which increases the dividends of injustice. Secularist may have great difficulty with a political economy that is strongly regulated by moral principles. Nevertheless, a morally self-regulated people would more likely regulate their own tendencies toward excesses, sexual and economic. They would be more apt to be less greedy and more just toward the less prosperous. They would be less likely to accept outrageous income at the expense of millions of fellow citizens. Persons not credit worthy wouldn’t get high interest loans. They would get a substantive economic plan to help them become credit worthy. Loan sharks couldn’t exist because greedy lawmakers and their corporate associates wouldn’t exist either. An unproductive vice like gambling wouldn’t have government backing because it would be much more difficult for corrupt politicians to openly justify preying on people with compulsive behaviors as a means to raise tax dollars. A moral economy would still reward entrepreneurs while assisting the less fortunate to work their way up to reasonable measure of economic independence. At least from the perspective of 18th century America, this would be expected because the primary source of morality is religion.

Helping poor families provide health care for their children should at best be a temporary aspect of an economy in which the principles of Jubilee are normative. This biblical law that makes helping fellow citizens through economic crisis to economic independence a legal obligation, should be the norm.

Punishing the poor with taxes, low wages, and high interest rates on loans they can’t afford is plain unjust.

Maybe God’s judgment is built into nature after all. The founders may have been right that it’s part of God’s natural law. It is apparent politicians can’t beat the system.

How to Reckon With Obama’s “American Recovery and Reinvestment Plan” January 6, 2009

Posted by Daniel Downs in Barak Obama, Congress, economy, free market, monetary policy, news, politics.
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President-elect Obama offers a new financial bail-out plan that must be reckoned with, and the following is how Bill Bonner of the financial investment newsletter Daily Reckoning reckons with it:

President-elect Obama is talking about relief on a Rooseveltian scale. He wants to spread unemployment and Medicare benefits around more freely, for example. But he knows he can’t just toss out a few dimes to bums on the street corners; he needs a stimulus plan that knocks peoples’ socks off.

“Economists from all across the political spectrum agree that if you don’t act swiftly and boldly we could see a deepening economic downturn,” he said recently.

We must be somewhere on the political spectrum. But he didn’t ask us. If he had, we would have explained that every penny spent on a bailout has to be taken out of the spending of the person who earned it. We’d add that there is no economic problem at all. The markets are doing what they’re supposed to do…clearing away the mistakes of the Bubble Epoch.

It’s a political problem, not an economic one. People don’t like to have to pay for their mistakes. So, they whine to politicians. And then the politicians make things worse…by trying to prevent the correction from taking place.

But, our “Head of State Hotline” has been silent, here at The Daily Reckoning headquarters. So we have to assume it was Barack Obama who was not calling – along with every other government leader on planet earth.

Mr. Obama figures he needs to do something spectacular … something that will give the impression of really turning things around. He calls his project the ‘American Recovery and Reinvestment Plan.’

Ahh…here are some question marks: What is it meant to recover? We don’t know…maybe the glory days of the Bubble Epoch. What is being reinvested? We can’t figure that out either. Typically, you reinvest a profit. But you have to have a profit to reinvest it. As near as we can tell, 2008 was a year of losses. You can’t reinvest losses.

Nevertheless, we know what American Recovery and Reinvestment Plan is…political claptrap. And now it’s expected to cost as much as $1 trillion. At least, that is what state governors are calling for. Congressional leaders say they want to stay below the “politically charged” one trillion dollar level. But they also say the bill won’t be ready for Obama’s signature until February. Congress needs time to pry open the pork barrel and spread it around – no question about that, either. By the time they’re finished, there’s almost sure to be $1 trillion work of grease in the package.

“US Debt Expected to Soar,” says the Washington Post, stating the obvious.

All this extra debt will do no good for the economy, but investors will probably feel like the good old days are back. And for a while, they will be…

The Rooseveltian-like plan mentioned by Bonner is described by others as mere socialism. In an article published by Redstate.com, Texas Congressman Louie Gohmert wrote:

When the country is facing dire economic straits, those who believe in free market principles must stand together behind proposals that steer us toward enabling the private sector to work as intended and away from socialism.

This is how Congressman Gohmert’s view of recent bail-outs as well as Obama’s Rooseveltian plan of socialism extraordinaire. He has presented an alternative solution. His bill, HR 7309, proposes to give each worker the first two months of 2009 federal tax free, which amounts to a 2/12 or nearly 17% reduction in income tax for 2009. he figures this would cover the $350 billion King Paulson should not be allowed to spend. Gohmert’s plan just might give workers and employers some money to spend. Gohmert went on to say in his article:

Our country needs help right now and we have to deal with Demo- cratic Congressional majorities and either a lame-duck GOP admin- istration advocating socialism or a new Democrat administration. The American people and the market are ready for an alternative to bailouts that just aren’t working.

He is right. As Bonner pointed out, if politicians and their whining constituents (I feel like whining too) would leave the market alone, the painful correction would take place, things would return to way it should be, and life would go on. The endless efforts of politicians to prop up the economy with their pop-sickle sticks to make the economy perceived as stable only prolongs the inevitable.

It seems to me that it is the secularist liberals that should grow up and stop trying to create a make-believe world that satisfying their perverse fantasies–uhhh, I mean utopia.

Sources: The Daily Reckoning and Rep. Louie Gohmert’s website.

Economic Recession : Connecting Candidates, Trends, Values and Voting November 3, 2008

Posted by Daniel Downs in Barak Obama, economy, elections, free market, God, John McCain, life, marriage, moral law, news, politics, voting.
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It’s a Bad Idea to Elect Candidates to Improve the Economy

Encouraging congregants to vote on Tuesday November 4, my pastor shared some very profound insights about how to view the issues. He said that we would be electing people who will be representing our views and our futures. Those we elect will make decision that will not only affect our own lives but our community and out nation He then followed with an insight applicable to all elections for all time.

The economy is constantly changing. The boom and bust cycles will continue no matter who is in office. We should not vote for candidates based on a troubled economy because it will eventually improve anyway.

Adding to his insight, I want to point out that our economy and its free markets are not some mysterious force operating outside the realm of human behavior. The economy is human behavior. The markets are the results of nothing other than human decisions. Intentionally or unintentionally, the problems and benefits of our economy are the results of human behaviors. The boom and bust cycles of our current economy are the results of policy decisions, trade and consumption practices, errors and neglect, as well as greed and irrational fears. Barak Obama and Congressional Democrats blame Bush for their own bad policy decisions and neglect of the mortgage markets that Congress created. And, Bush’s spending didn’t happen without their approval either.

The Obama Connection?

Cliff Kincaid, Editor of the Accuracy in Media Report, wrote an article on who is behind the economic collapse. To appreciate his argument, you must read the entire article. Here, I will try to summarize some of his main evidence to illustrate my point. Kincaid research points to Democrats as the primary actors suspected of generating the current economic crisis of New Deal proportions. His research ties US Treasury Secretary Paulson, who worked for a Democratic firm, Goldman Sachs to leading Democratic Party fundraisers, and to Barak Obama. Those suspected of creating the current economic crisis for political reasons would not be complete without George Soros, who has a reputation for creating national economic crises. Other writers have produced lists of former employees of Goldman Sachs who have filled leading positions in both Fannie Mae and Freddie Mac. Many others are being investigated, according to Kincaid.

Recession and Election Cycle Trends

If I remember correctly, the past four or five presidents were elected during an economic correction sometimes called recession. According to financial expert John Mauldin, President George W. Bush inherited an economy already in recession from Democrat Bill Clinton. Oddly enough, Americans elected Clinton as President in part to solve the recession that occurred during George HW Bush’s term in office. We voted Ronald Reagan into office because of his plans to solve the deep recession inherited from Jimmy Carter. Many Republicans voted for Democrat and Baptist Jimmy Carter because of they believed his faith was real and because of his plan to solve the recession-sized energy crisis. Like my parents, many Republicans were sorely disappointed.

Learning From the Past?

It must be questioned whether the most educated people in the world are capable of learning from the past. It is claimed that many Republicans again favor a Democrat for president. That is certainly their right. Many religious leaders have championed the cause of the Democratic Party its candidates. Again, that is their right. Yet, the Democratic Party is more socialistic, more pro-abortion, more opposed to traditional marriage than ever. Their presidential candidate does have religious credentials. However, the religious aura surrounding Barak Obama is a cloud of illusion. I think it is more of a smoke screen for the sole purpose of winning an election. Whether McCain is sincerely Christian is debatable as well. However, his VP choice at least gives us hope for a strong pro-life and pro-family influence in the Whitehouse.

I return to my original point borrowed from my pastor. Whether economic crises are the result of evil intentions or simply bad decisions, they are the product of human behaviors. They have occurred throughout our nation’s history. As now, they have always been corrected by appropriate behavior and policy decision. This corrective process is already in motion. Therefore, whoever we elect as the next president is mostly irrelevant.

Voting Decisions and Issues of Unchanging Importance

My pastor continued his political exhortation with another and even more important insight. Instead of making our voting decisions based on a continuously changing economy, we would find better representation in government if we made our decisions based on unchanging criteria. Going back to the biblical book of Genesis, he reminded us of source of our moral values, the sanctity of human life, and of human dignity. These are the most important criterion. As history teaches, the decline of morality in societies always results in that society’s end. Therefore, in this pivotal election, we will choose whether morality and the sanctity of life will be upheld and strengthened or whether morality will continue to decline.

Having done my own research, it is clear to me which candidate will defend the life of the unborn, the sanctity of traditional marriage, and the general morality our form of democracy has always required. Like the traditions of their respective parties, Democrat Barak Obama favors abortion and opposes defining marriage as one man and one woman because he supports the politics of sexual immorality. John McCain claims to be pro-life and favors overturning Roe v Wade because it was an erroneous ruling. He supports traditional marriage but believes it’s outside the power of federal government to decide on issues of marriage.

Voting Means Judgment—Of Candidate and Maybe of God

As Americans used to believe regarding disasters whether affecting national, state, and local communities, I too believe America is already experiencing God’s justice for the long official support for every form of immorality, for the brutal slaughter of millions of unborn children, for legitimizing unnatural and harmful behaviors of gays, and for many other crimes against God’s moral laws. If this assessment is correct, then this election is the most important and most pivotal of all elections in American history comparable to the election of Abraham Lincoln.

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(Note: The title of John Mauldin’s financial commentary referenced above presents the insightful and witty perspective of it gifted author; the title is “Electing the Janitor-In-Chief”. Mauldin’s work is profitable reading and can be accessed at his website www.fronlinethoughts.com)

A Private Sector Fund and Investor Market Solution Alternative to the Congressional Bailout September 26, 2008

Posted by Daniel Downs in Congress, economy, free market, inheritance tax, investment, mortgage, news.
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Times of crisis have often challenged Americans to demonstrate their practical problem solving genius. It is one of those good traits that has made America a leader in the world. I suspect Gary Palmer, President of Alabama Policy Institute, is another possessing such a nationally beneficial genius. But, I will let you make that judgment after reading his September 26 column titled “Bailout Isn’t the Only Option.”

Palmer’s Bailout Alternative should be read by all of our federal representatives before making their final plans.

It is evident that American taxpayers are angry about what it appears Congress is going to do: a $700 billion taxpayer bailout of the ailing financial and mortgage institutions. According to a September 24th USA Today/Gallup poll, 56 percent of the American people want a different plan. Unfortunately, this is very likely an article about what Congress could have done instead of what they will do to recapitalize our nation’s financial markets.

Apparently, the dire warnings from the Bush Administration and others that the economy is on the brink of failure is not enough to persuade American taxpayers that a bailout is the answer to the financial crisis. The perception is that the federal government is forcing the taxpayers to pick up the tab for the problems created by the mismanagement and corruption of greedy corporate executives and their enablers in Congress.

The fact is the bailout is more of a buyout. The package that Congress is considering would commit the federal government, i.e. the taxpayers, to spend hundreds of billions of dollars buying mortgages. This means the federal government will be in the real estate business, at least until it can sell its new real estate holdings, hopefully at a profit.

This action is supposed to result in the recapitalization of the financial industry. Could there be another way to unclog the financial arteries of the nation’s economy without adding $700 billion to $1 trillion to our federal debt?

The answer is yes.

Congress could create an opportunity for private sector funds to be used to recapitalize banks and the housing industry by using assets subject to the inheritance tax. It is estimated that between $1-1.5 trillion in assets will be transferred to heirs over the next ten years. In 2009, under current law, estates with assets worth more than $3.5 million will be subject to a tax of 45 percent on everything above the exemption. And, unless Congress renews the Bush tax cuts, in 2011 the exemption will decline to $1 million and the tax will increase to 55 percent on the amount above the exemption.

In order to get more private equity into the financial and mortgage markets, Congress should create a 12-month window in which anyone with assets subject to the inheritance tax could use those assets to purchase residential real estate or mortgages. The assets used within that time frame would never again be subject to an inheritance tax.

If the real estate purchase produces income, such as rental income or increases in value, the estate owner would pay the usual income and capital gains taxes. However, if the investment resulted in a loss, investors would not be able to deduct the loss on their income tax return.

A 45 or 55 percent tax is a hefty penalty for dying and there is a lot of incentive to try to avoid paying it. Because every dollar of private money infused into the real estate and mortgage markets would replace a dollar that the federal government would have to spend in a bailout, this option could significantly reduce the size of a bailout and save billions of taxpayer dollars.

Given the dire circumstances we face, members of Congress should be willing to consider this option. It will benefit all American taxpayers as well as those faced with paying inheritance taxes. Moreover, even though some portion of the inheritance tax would be eliminated, directing those assets into the financial and real estate markets gives it the effect of a tax in that the resources are being directed to a specific purpose.

There is another idea that also makes sense. Congress should create a six month window in which investors could purchase residential real estate and receive a tax credit of 20 percent of the purchase price as an incentive to buy. The tax credit could be taken in the first year or it could be carried over in successive years until it is used up.

Currently there are more than four million houses on the market nationwide. Given that the median price of a house is around $196,000, it would take about $400 billion to cut that inventory in half. Using the above figure as a baseline, by offering a tax credit of 20 percent of the purchase price, the cost to the federal government of the tax credit would only be $80 billion.

Perhaps the most important thing about a private sector solution is that it would help restore market discipline. A taxpayer bailout increases moral hazard, i.e. the likelihood that this will happen again. Keeping these transactions entirely within the private sector would not only stabilize the market, but would also help restore market discipline and enforce a degree of accountability and responsibility on those who created the crisis. As a result, those who made the really bad deals will still suffer some consequences for their actions.

These ideas will not totally eliminate the possibility of direct federal action. But, if the federal government eventually has to act, it would be at a significantly lower cost to the taxpayers and with significantly less danger of nationalizing the mortgage industry.

Clearly, Congress is going to address this problem. Will Congress pay attention to the American people and consider alternatives such as allowing the private sector to be a part of the solution? Unfortunately, it appears at this point that some Congressional leaders believe the only plan is a taxpayer bailout.

Gary Palmer is president of the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.

The Tate Plan on fixing the depression-sized economic crises September 26, 2008

Posted by Daniel Downs in Congress, economy, free market, legislation, monetary policy, news, politics.
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Continuing Ron Paul’s warning about the dangers of the Paulson and Bernanke bailout plan, John Tate, President of Campaign for Liberty, outlines how to solve the underlying cause of the dire economic crisis.

Introducing his recapitalization plan, Tate says,

We do know that our economy is in for a rough ride. These bad mortgage-related assets will have to be cleared out and the market will have to reset. The only question is how that will happen.

The easy way out is to continue the same practices that got us to this point. We can put $700 billion, for starters, in the hands of Treasury Secretary Henry Paulson (a former CEO of Goldman Sachs) and Federal Reserve Chairman Ben Bernanke, and let them spend the money on whatever they wish.

This option will only delay the economic downturn, which will only be worsened.

Or, we can take this opportunity to end the federal government’s interference in the marketplace, truly embrace free market capitalism, and return to a sound monetary system.

The Federal Reserve’s practices of easy credit and monetary inflation have crashed our economy, and now they’re asking us to trust them to fix it.

Tate proposes a better solution. He argues that his (read: Ron Paul) will restore our economy to a properly working capitalism. Tate’s four point plan is:

1.) End the Bailouts – Congress must revoke the Federal Reserve’s authority to bail out failed businesses at your expense.

2.) Cut Taxes and Curb Regulation – If we really want to stimulate businesses and revive the market, we need to cut corporate and capital gains taxes, spurring investors to come back to the market and making it easier to attract new workers and clients. It is also time to end failed legislation like Sarbanes-Oxley, which has crippled capital markets, diminished our competitiveness, and greatly harmed small businesses.

3.) Reduce Spending – We must freeze all non-entitlement spending by the federal government at current levels and eliminate wasteful spending both domestically and in our trillion-dollar overseas budget. Our debt has to come down, and it won’t until we start living within our means.

4.) Reform the Monetary System – If we are to have long-term economic progress, we must end the system of printing money out of thin air. The current laws limiting the circulation of gold and silver-backed currency must be overturned. We can no longer base our money on the empty promises of bureaucrats that it is sound.

Maybe the big corporate media and their Capitol Hill partners should take Ron Paul more seriously. Maybe all of us Americans should.

Source: From an email letter from John Tate on September 26, 2008.