My view is that it's a free country and that free speech and the freedom to assemble are among the guaranteed rights provided by our Constitution. Thus, I can't protest against the protesters' right to speak, assemble and even protest.
In that spirit, I'm protesting the passivity of myself and my fellow taxpayers when it comes to enabling and then allowing politicians to continuously waste our money. But first, some background.
Four timely articles are relevant to my decision to speak out against "us" at this time. It's a Pogo moment, I guess.
The articles are (1) Student-Loan Debt Among Top Occupy Wall Street Concerns, (2) Wall Street's Gullible Occupiers, (3) Wall Street Shrinkage and (4) Populist Anger Over Economy Carries Risks for Big Business. They are all interesting, relevant and informative. {My favorite is #2.}
Highlights from each of the four follow:
(1) "Student-loan debt has continued to grow despite a financial crisis that constrained credit elsewhere, and the increasing burden amid high unemployment is driving at least part of the protests among the Occupy Wall Street movement.
Last year, Americans began to owe more on their student loans than their credit cards, with student debt reaching the $1 trillion mark. Many have flocked to higher education during the down economy, only to find themselves still unemployed or underemployed.
Zak Cunningham is a 22 year old who graduated from Earlham College in Indiana last spring.
He says he “doesn’t know how much student loan debt” he has, since he hasn’t bothered to count. He doesn’t have a job and wants to go to graduate school, but is worried about the cost.
Cunningham, tall, lanky and bare-chested with a red bandana around his neck and cigarette in hand, is among those flocking to the Occupy Wall Street demonstrations at Zuccotti Park. And while organizers say there’s no official “census” of who make up the protester base at Occupy events, the presence of student loan debtors and young, unemployed people, is noticeable. See a chart made by Mike Konczal, who parsed data from the related We Are the 99%.
In general, college graduates have held up better in this recession than those with only a high school degree. But the cost of education was at the root of many of the Occupy attendees’ complaints."
(2) "There is no mystery where the Occupy Wall Street movement came from: It is an offspring of the same false narrative about the causes of the financial crisis that exculpated the government and brought us the Dodd-Frank Act. According to this story, the financial crisis and ensuing deep recession was caused by a reckless private sector driven by greed and insufficiently regulated. It is no wonder that people who hear this tale repeated endlessly in the media turn on Wall Street to express their frustration with the current conditions in the economy.
Their anger should be directed at those who developed and supported the federal government's housing policies that were responsible for the financial crisis.
Beginning in 1992, the government required Fannie Mae and Freddie Mac to direct a substantial portion of their mortgage financing to borrowers who were at or below the median income in their communities. The original legislative quota was 30%. But the Department of Housing and Urban Development was given authority to adjust it, and through the Bill Clinton and George W. Bush administrations HUD raised the quota to 50% by 2000 and 55% by 2007.
It is certainly possible to find prime borrowers among people with incomes below the median. But when more than half of the mortgages Fannie and Freddie were required to buy were required to have that characteristic, these two government-sponsored enterprises had to significantly reduce their underwriting standards."
(3) "The report also underscores the delicate position some of the region's politicians find themselves in as anger at the financial industry takes the form of street protests like the Occupy Wall Street encampment. Many protests are backed by powerful constituencies like organized labor, but those politicians are heavily reliant on revenue from Wall Street to balance their budgets and avoid painful cuts and tax increases.
"Wall Street is on the defensive, having been painted as the villain in the overall economic scenario," Ms. Wylde said. "Unless we can figure out how to reposition the industry as a key to the solution for future growth, New York is going to suffer the results, suffer significant losses in both jobs and revenues.""
(4) "So what is hindering job creation? Unpatriotic corporate behavior, or a suddenly hostile business environment?
The full answers are much more complicated. The forces holding down job creation include many—a deeply flawed and uncompetitive corporate tax code, rising health costs, crumbling infrastructure, an inadequate education system—that transcend current problems. Those, in fact, are issues the White House jobs council's new report tries to address.
The danger for American business, though, is that it in a hothouse environment of rising populism, and absent a better job making its case, it can become the target of punitive measures—surtaxes, even more regulation, trade barriers and restrictions on the flow of capital—that would make job creation harder."
There we have it. 1,2,3,4. Each is worth reading in full.
With respect to each of the four, here are some takeaway questions for my fellow taxpayers.
(1) Why do we taxpayers trust government with our money to loan to "subprime" students so they can make rapidly increasing tuition hikes to taxpayer supported schools? Why do we fund loans for students who generally don't graduate? Why do we loan money to other low performers who graduate but apparently are not able to get jobs. Don't we know that this will leave taxpayers with one huge bill when the students default on their loans, as many inevitably will? In other words, why don't we have higher standards when granting government/taxpayer supported student loans?
(2) Why do we taxpayers trust government with our money to guarantee loans for "subprime" home buyers who often put no or little money down, receive low fixed interest rates for thirty years, and have the ability to walk away from these loans if they become underwater, thus leaving taxpayers with the bill when they default, as many inevitably will? What individual taxpayer would make such a foolish loan with his own money to the "subprime" borrower, and why does that same taxpayer when acting collectively allow the government to act so recklessly with his money?
(3) If as a result Wall Street has to reduce its workforce and fewer taxes are then paid to New York City, New York State, and the federal government as well, why is that a good thing for anyone, including protesters, labor unions, politicians, city workers and taxpayers? If the profits and payrolls on Wall Street go down, then tax receipts will go down, and if tax receipts go down, where will the money come from to subsidize members of the Occupy Wall Street movement and its sympathizers? And where will we get the money for student loans and home loans as well?
(4) If American sector businesses are going to be the scapegoats for populist and political punishment, how will that help those doing the punishing? Aren't businesses the ones who create the jobs, and if they are in a worse position to do so going forward, how does that help?
There are other questions that come to mind, but you get the gist.
Summing Up
As individuals the private sector fat cats, aka CEOs and other business leaders, will do fine, regardless of the vilification by politicians, protesters and others. Thus, let's not waste time on these people or how they feel about things. They can take care of themselves and will do so.
But what about the taxpayers--er--we the people? Who will take care of us? We never seem to get a fair shake from the 'fiduciary' politicians to whom we entrust our hard earned money.
Invariably, it seems that when money moves from taxpayer MOM to government OPM status, politicians inevitably do a poorer job with that money than we would have done ourselves. Politicians find lots of ways to waste lots of money.
But here's my real beef with us. Pogo teaches, and I agree, that it's up to taxpayers to take care of ourselves. Accordingly, we shouldn't turn over to politicians more than the absolute minimum of dollars necessary to conduct the minimum level of effective government operations. When we continue to do so, despite ample and ongoing evidence of their waste and disregard for our money, it's our fault.
We know that the more OPM politicians have at their disposal, the more money they will waste. And without vigilant oversight and transparency, OPM is a disincentive for them to do the right things.
Since the taxpayer money is free to the politicians, it will often be loaned to people who won't be able to repay what they borrow. Politicians are equally bad when investing taxpayer money, as Solyndra and other examples clearly demonstrate. So why do we taxpayers put up with this?
The Occupy Wall Street protesters with unpaid student loans should be encouraged to work harder to get a job--any job-- because that's the only way they'll ever be in a position to repay the student loans. Of course, taxpayers and politicians should want that outcome, too.
All of which brings us back to where we began--the proper role of government in a free society. Or if you prefer, the relationship between those who redistribute wealth and those who create wealth.
It's a simple choice between government OPM spending and taxpayer MOM spending. Collectivism versus individual freedom.
As citizens of a free society, these are always our choices to make. So let's choose to stop giving our own money to subprime politicians to waste on high risk subprime projects and borrowers.
To coin a phrase, MOM is a terrible thing to waste. But if even we choose for our money to be wasted, let's at least waste it all by ourselves.
Thanks. Bob.
No comments:
Post a Comment