So we are spending HOW much now?

Well, the initial bailout for Bear-Stearns was $29 billion, Fannie and Freddie got $200 billion (initially, with freedom for the Fed to give as much as they wanted to), AIG got $85 billion, $168 billion additonally for stimulus, and now $700 billion dollars (plus who knows how much more)... so that is something like $1.3 trillion dollars for "stimulus" and "bail-outs". The ENTIRE federal budget this year was $2.9 trillion to start with... and the ENTIRE reciept from income taxes was $1.25 trillion. That means already this year we have spent more money trying to "fix" the economy in the short term than we have taken in from the top source of income to the federal government.

But what is causing this whole problem in the first place? Why are all these businesses failing? Well, most of them are banks. You would think banks would be plenty safe considering all of their regulation and income, right? Well, not really. People who are getting loans now are misrepresenting their income, even being ENCOURAGED to overstate their income to get bigger and better houses than they can afford, and in the end can't make their payments on their Escalades and 3000 sq ft houses on their meager incomes. Basically what happened is that 10 years ago, people complained that the poor people couldn't qualify for loans based on their bad credit and no income. So a law that was passed back in the day got repealed so that anyone could get a loan, the "sub-prime" thing everyone is talking about, and now we are seeiong the effects of it. Companies when they have to forclose on a property have to auction off that property... and knowing people that work in the forclosure sector, let me tell you that they ALWAYS lose money when they have to forclose. Banks hate forclosing, but it's just what has to be done. But that isn't even the real problem. At least there, money is backed by a property. The big issue is when the loans get overlent. It used to be that banks had to have money in the bank as a percentage of what they lent out. For every 10 dollars they lent, they had to have a dollar in the bank. This was the issue back during the depression when the banks had rushes on them and they didn't have anything on hand to deal with it. Banks went under because all of their loans failed and they didn't have ANY money to back it up. Of course now banks often loan 60 dollars to every dollar that they have on hand because it is just created out of thin air in a computer, or the loans are actually given from someone other than them. When you go get a car loan, often the loan is actually through someone else. Lots of banks are paid to give out loans and have to meet certain quotas, but those loans aren't even done through their banks, they are FHA loans or done through Fannie Mae and Freddie Mac even today... and there just isn't enough demand for them. A caller in to Rush Limbaugh the other day said this and said it isn't that there isn't money, because they have tons they need to loan (unlimited, because they create it out of thin air) but people just aren't getting loans. And now with the "crisis" the congress has actually cleared away ANY requirements to have cash on hand, and banks can basically create loans in an unlimited number without having anything at all to back it up. It's just created numbers in a computer system that gets transferred between banks. From 10% to 0%... and when you realize what this actually does (Indie Mac anyone?) it is a very scary thing.

At last count, there is only $900 billion dollars in actual physical US currency in circulation... and we owe 10 times that much. How much more do we have to print before people around the world realize that it is backed by nothing and it becomes completely worthless?

Disillusionment of politics

So it really makes me wonder if the powers that be in Washington, on both sides, actually care at all about the money they force us to send them every year. Both candidates for president are promising to spend more money, both candidates are promising that the government will do more things (which sounds nice to SOME people that actually get a benefit from what the government does), and both are promising that they will be the best person for the job. Neither the R or the D vice-president is superior to the other in my opinion after having watched them debate, just like neither the R or the D presidential candidate are superior to the other... but my biggest concern right now is Congress. While MY representative, Jeb Hensarling (who I am definitely a fan of) voted against the bill in the house, which didn't pass, BOTH Texas senators voted for it. 700 Billion Dollars. Billion with a B. That is nearly a trillion dollars, which it probably WILL end up being by the end of this. Now I for one did get my 600 dollar "economic stimulus", which didn't even make a dent in anything, but when I think about it, even if every single person in the US got that (which they didn't) that would be 305 million people getting it, for a total of 183 Billion Dollars. This bill is basically spending the equivalent of $2000 for every single person living in the United States... is that not insane? If you consider there are only about 170 million people that are actually working, that is $4000 per taxpaying person. I personally didn't intend to give banks and insurance companies $4000 of my income this year, did you?

So instead of doing something that would be helpful, like letting the lying, cheating, and stealing banks that have already been discovered to be commiting fraud at every turn, the government is giving them money. Couldn't smaller companies just pick up the slack? Or even larger ones. Bank of America and JP Morgan-Chase have been buying out the banks that are failing... there are plenty of insurance companies that could buy up the ones that are failing. Plenty of them make a ton of money and have it available to spend. So why in the world is the government trying to give them money? Well... a simple reason. Money. It's the biggest scam in the world, and nobody bats an eye. The companies that are getting bailed out are some of the biggest donors to political campaigns. And not just one side or the other.
Look at House Speaker Nancy Pelosi. From Banks and insurance companies, which this bill concerns, she recieved $228,000. That is about 10% of her TOTAL contributions. Crazy Democrats, right?
Well then lets look at my own two senators from Texas.
Kay Bailey-Hutchinson
$439,000 from banks and insurance companies. Closer to 5% of the total, but that is still a TON of money for a political campaign.
John Cornyn
$734,000 from banks and insurance companies. About 5% of his total.

The only people that donate more to political campaigns in general than banks, "wall-street" securities firms, and insurance companies are lawyers, and we can see the effect that has with nothing getting done in the court system for reform. It's the same thing with these huge corporate bail-outs. They allocate money and tax-breaks for the companies (I am not against the tax breaks), and they get their kick backs. Not directly of course, because that would be illegal. It is just "campaign contributions".

Well I for one am tired of it. With the exception of my own representative, who voted NO on the bill in the house, I have no incumbents in any position in government that I care to vote for ever again. I won't go so far as to just vote for any random Democrat that is going up against them, but I will certainly find a valid "third-party" alternative.

I am fed up with the people in government that probably don't even remember when they first sold their soul to the mighty dollar, it was so long ago.

Hensarling voted no, and my former district Rep Sam Johnson (who I am also a huge fan of) voted no, but there are a TON of representatives in the House even from Texas that voted yes, so there is no end to the level of my disappointment with the politicians in Washington that supposedly represent MY state right now...

Update: Johnson and Hensarling voted NO on the second go round in the House that actually passed. Still my heroes.