Day: February 2, 2010

Should He Go Or Should He Stay #3

This is the final part of my series on why the Obama economioc team should get the Hell out of Washington…..

I have said in my other two parts that Geithner and then Bernanke should depart as the economic team in Washington…..but I would be remiss if I left out the actor in the wings…the guy backstage that is a :key” piece of the economic recovery team….Larry Summers.

In the beginning there was Larry Summers…Mister Magic was wanted as secretary of treasury but was left out because of his controversial time at Harvard when he made some unfortunate comments about women…..the future Prez and his handlers figured that Summers would be a huge distraction and that their proposals would go unnoticed by the sideshow of his nomination….so he became a behind the scenes adviser and let Geithner fade the heat because he was more easily nominated….

But to me there is more to this story than most know and because of that I say he needs to be yet another member of the Obama adviser corps that nbeeds to leave Washington and maybe the middle class would have a fighting chance with new economic leadership….

So of the stuff that was readily reported about Summers and his ‘expert’ economic leadership…….the website Exiledonline.com has an excellent anbalysis on the past economic endeavors of Larry Summers……

But let’s return to the Summers timeline. After his stint in the Reaganomics brain trust, he returned to Harvard to serve as one of the university’s youngest professors. In 1988, he was Michael Dukakis’s chief economic advisor, but when that campaign failed to bring Summers to power, he turned to America’s great rival, the former Soviet Union, to try out his economic experiments. In 1990, Lithuania, a restive Soviet republic seeking independence, hired Summers to advise on that country’s economic transformation. Poor Lithuania had no idea what it got itself into. This was Summers’s first opportunity to tackle a country in economic crisis and put his wunderkind theories into practice. The results were literally suicidal: in 1990, when Summers first arrived, Lithuania’s suicide rate was 26.1 per 100,000 and falling. Just five years after Summers got his hands on Lithuania’s economy, life became so unbearable under the economic transition that the suicide rate nearly doubled to 45.6 per 100,000, worse than any other ex-Soviet republic in transition. In fact, it was the highest suicide rate in the world, suggesting something particularly harsh and brutal about the economic transition in that country as opposed to the others, where suffering and pain were common. Things got so bad that in 1992, after just two years of Summers-nomics, the traumatized Lithuanians voted the communist party back into power, the first East European nation to do so–even though just a year earlier Lithuanians actually died on the streets fighting communism.

Fresh off his success in Lithuania, Summers moved to the World Bank, where he was named the chief economist in 1991, the year he issued his famous let’s-pollute-Africa memo. It was also the year that Summers, and his Harvard protégé Andrei Schleifer (who worked with Summers on the Lithuania economic transformation), began their catastrophic “rescue” of Russia’s crisis-ridden economy. It’s a complicated story involving corruption, cronyism and economic devastation. But by the end of the 1990s, Russia’s GDP had collapsed by more than 60 percent, its population was suffering the worst death-to-birth ratio of any industrialized nation in the twentieth century, and the financial markets that Summers and Schleifer helped create had collapsed in what was then the world’s biggest debt default ever. The result was the rise of Vladmir Putin and a national aversion to free markets and anything associated with Western liberalism.

In light of all of the corruption, cronyism and devastation that have marked his career, Summers’ statements about an under-polluted Africa or intellectually-inferior women no longer seem like provocative eccentricities but part and parcel of the Summers shtick. And now there’s talk that President-elect Obama may hand the keys to national treasury to Summers–meaning that he’ll be in charge of overseeing a trillion-dollar taxpayer bailout of the entire financial industry, a process already rife with conflicts of interest, cronyism and corruption.

Now I asked…after you guys have read this about Summers what part of his past would lead you to believe that he would have any successful answers to the recession?  What part of his past shows any concern for the plight of the middles class?

Now with the abysmal record and doings of the “big three’ of economic recovery, what part or which one of them seems to have a grip on what to do to improve our standings?  For the good of the country…ALL three of these people should be run out of Washington on a rail with tar and feathers applied….NONE of them has the interest of the middle class as a priority….they are ALL paid for by Wall Street and they function as Wall Street surrogates in Washington.

Obama’s First Budget

By now everyone has heard about Obama’s budget that came out yesterday…a$3.8 trillion package…..some think it is too high (which it is) and some will make political gain out of the opposition to this first budget….no matter what you believe or how you feel about the large budget…..do you know the process unknown as the budget process?

Let me help you out…would not want a mental overload to endanger your viewing capabilitiies for “Dancing With The Stars”….

1. PRESIDENT’S BUDGET REQUEST. After asking federal agencies how much money they need to get their work done, the White House compiles a budget request and submits it to Congress on or before the first Monday in February.

The budget request shows broadly how the president wishes to implement fiscal policy — how much he aims to raise in taxes, how much he wants to spend, and how much the gap between the two will add to the country’s debt.

2. CONGRESS DRAWS UP ITS PLAN

After the budget request is submitted, the House and Senate Budget committees develop their own “budget resolution” — a guide that states how much revenue the government expects to collect and how much it will spend.

Congress is supposed to approve this resolution by April 15, but it often misses that goal. Congress has failed to adopt a resolution at all three times over the past 10 years.

Spending totals are defined in two ways: authority, or how much money a federal agency is authorized to spend, and outlays, or how much that agency will actually spend in the coming year.

3. CUTTING THE CHECKS

After the budget resolution passes, the 12 appropriations subcommittees in each chamber set funding levels for individual government programs and write up detailed instructions for the agencies that oversee them — such as how to divide highway construction money among individual projects.

Lawmakers often insert “earmarks” into these spending bills, which ensure funding for specific projects in their home districts that are not requested by the president.

Earmarks have figured in several corruption scandals in recent years as some lawmakers have used them to steer money to supporters, and reformers often suggest banning them entirely.

Appropriators say earmarks are a necessary part of the process because they build support for the spending bills needed to keep government running and ensure that Congress exerts some control over the massive federal bureaucracy.

Ideally, Congress passes all 12 appropriations bills individually by October 1, the start of the fiscal year.

That’s all, folks!  It is just that simple, as a process goes, but now the fun starts….Congress gets involved……and we all know just how good these ass clowns are at being pathetic…..