Congress and Big Business Responsibilities

October 2008: We the People are really upset about our government and corporate giants. Given our Financial problems in the USA, we must understand in simple, frank words, what we as a country, Congress, small businesses and Corporations must do to solve the lack of financial oversight by our Congress, greed of the financial institutions, and abysmal pork spending of Congress. I am an independent and I care only whether the next President, Senator Obama or Senator McCain, understands the financial storm they are walking into. The spending proposals both presidential candidates have made are not going to solve this problem. We must cut expenses and the people who are receiving free money are going to have to sever the umbilical cord. Technology must focus on Energy advancements, Corporations must bring jobs back to the USA, and the banks need to pull their Ostrich heads out of the sand hole. If you don’t free up operating capital, then the banks will be responsible for the slow choking of business in the USA, as well as the world!

The financial mess we are in was caused by a number of factors, but can be summarized with four major elements:

1) Liberal Congress members pushing hard to get Fannie Mae and Freddy Mac to support low income loans. 20 years ago, you had to have 20% down to get a home loan. 10 years ago, it went to 10% down, making it easier for people to get loans. 7 years ago, Freddie Mac and Fannie Mae pushed Congress hard to offer 0% down, and guess what? Many more people were able to buy homes, but their income was low and as the adjustable loans increased in rates, bankruptcy began. Barney Frank is the Democrat in charge of the House Committee on Financial Services in the House of Representatives. He was closely allied with Fannie Mae and Freddie Mac Directors some years ago. Sen. Frank and Sen. Dodd have oversight of Freddie Mac and Fannie Mae financial entities. Were they objective in their Congressional responsibilities? If they were monitoring as they should have done, this situation would have been alarmed to the American people by Frank and Dodd in 2002 – 2008. But all we heard are visual and audio presentations about how well things in Fannie Mae and Freddie Mac. We never heard the alerts from Senators Frank and Dodd. It is easy for them to deny any responsibility. Why then are they Committee Chairmen. If you want to play football, you better be able to pass and catch the ball.

Prior to President Clinton departing as President, Pres. Clinton signed into legislation, pushed through Congress by the Democrats and Republicans, a bill that significantly relaxed oversight and regulation of Fannie Mae and Freddie Mac. Barney and Dodd know this and were responsible for passing the legislation. So the combination of Congressional pressure to relax oversight and regulation on these two major banking guarantors, and the totally useless oversight of Barney Frank and his Republican predecessor, the housing melt down was allowed to happen. Up until 2006, everybody thought they were having a happy old time, but now the piper is at the front door. And there are no more bankers standing at our USA door to loan money to the USA.

2) The Banking Institutions used greed to sell to the low income customers, and then sold the bad loans to other mortgage brokers with a guarantee to the buyers, buying the bad loans that the bad loans were guaranteed for payment. The problem is that the guarantee was not regulated, (again our Congress at fault), and the liability of the bank was not documented in their accounting practices (our Congress at fault again). Thus these big banks had bank statements that showed how well they were doing, they had liabilities that were far greater than their cash on hand. and they were permitted to hide their liabilities from stock and bond buyers. They sold bad loans to “We the People” in the form of stocks, bonds, mutuals, much of what went into 401 retirement funds. What is worse, banks buying the bad debt, resold it with more bogus guarantees to other negligent buyers. So 5% of the bad loans compounded the 5% mess into a stock market reduction from 14,000 high (which was artificial and inflated) to about 9000 today. The financial market will likely drop to its real value of 8000 or 8500 by December 2008. The 5% bad debt has been amplified to a 35% or more total loss in home and financial value.

3) Home buyers were pushed into adjustable loans. The financial greed of the banks, combined with the home buyer’s ignorance of the ballooning mortgage bill, created possibly 2 million poor loans. The people who agreed to these ballooning home loans were at best negligent in their duty to know what they were getting into. Some were deceitful, some were ignorant of the hole they were digging for themselves.

4) Pork Barrel Spending of both Republicans and Democrats. The pig trough has been open for 8 years and how they spent our money. I want to keep this brief, so that is another story.


HOME: Just like in each of our homes, we can spend only what we get paid on a weekly basis. Oops, maybe I mis-stated that. Look at all the credit (cards) available to us for the last 10 years. How much Credit Card Debt do you have? Car loan debts? Mortgage debt? We have too much debt and that is precisely the problem. As in your household, we can only spend the money we make each month. Those credit cards are going to have to be paid off. A lot of people will say “the hell with it” and claim bankruptcy, making the total USA problem worse. Many of us will pay our debts. But, we as a country have to go back to a cash only society. The Banks and their credit cards are going to have to be drastically cut back; and we are going to have to cut back our household spending. If you don’t have cash, don’t buy it. The stores will hate it because they have gotten used to you buying on credit. Too bad, so sad.

Banking Industry must get an objective appraisal by an independent group of non-wall street thinkers on the faults of the last 6 years, propose a regulation solution that constrains their decisions based on greed, and supports banking decisions based on healthy, long term, financial gain. Banks, as we all do have a right to success, but not greed. The bank directors, board members, managers who allowed their people to drive our country into debt need to pay hard time in jail. The millions of dollars they received on greed needs to be taken from these board members and presidents. AIG, you better clean your act up and pay back the $430K you pigged out on after you got bailed out. Your directors and board members need to go to jail, have your bank accounts absconded, and you should be ran out of town. Amazing that you guys feel you are above everybody else. And then there is Fannie Mae and Freddie Mac. The directors and Board members should lose all their money, homes + cars + boats + investments of any kind purchased from the last 7 years, and be put in jail. Run them out of the country.

House Committee on Financial Services needs to be fired with the exception of Ron Paul, who has consistently stated for the last 6 years a financial storm was on the way. In the case of votes, each state who has a member on the congressional banking committee below, should replace that person with a new objective, congressional representative.

Chairman Barney Frank represents Massachusetts’ Fourth Congressional District. Barney, you are an embarrassment for your supposed financial wisdom and your lack of true concern for our country’s financial position. You the other Democratic and Republican members of the Financial Committee are:

Rep. Paul E. Kanjorski, PA
Rep. Maxine Waters, CA
Rep. Carolyn B. Maloney, NY
Rep. Luis V. Gutierrez, IL
Rep. Nydia M. Velázquez, NY
Rep. Melvin L. Watt, NC
Rep. Gary L. Ackerman, NY
Rep. Brad Sherman, CA
Rep. Gregory W. Meeks, NY
Rep. Dennis Moore, KS
Rep. Michael E. Capuano, MA
Rep. Rubén Hinojosa, TX
Rep. William Lacy Clay, MO
Rep. Carolyn McCarthy, NY
Rep. Joe Baca, CA
Rep. Stephen F. Lynch, MA
Rep. Brad Miller, NC
Rep. David Scott, GA
Rep. Al Green, TX
Rep. Emanuel Cleaver, MO
Rep. Melissa L. Bean, IL
Rep. Gwen Moore, WI
Rep. Lincoln Davis, TN
Rep. Paul W. Hodes, NH
Rep. Keith Ellison, MN
Rep. Ron Klein, FL
Rep. Tim Mahoney, FL
Rep. Charles Wilson, OH
Rep. Ed Perlmutter, CO
Rep. Christopher S. Murphy, CT
Rep. Joe Donnelly, IN
Rep. Bill Foster, IL
Rep. Andre Carson, IN
Rep. Jackie Speier, CA
Rep. Don Cazayoux, LA
Rep. Travis Childers, MS

Republican Members

Rep. Spencer Bachus, AL
Rep. Deborah Pryce, OH
Rep. Michael N. Castle, DE
Rep. Peter King, NY
Rep. Edward R. Royce, CA
Rep. Frank D. Lucas, OK
Rep. Ron Paul, TX (Ron Paul is a keeper for his steadfast warnings of this financial crisis)
Rep. Steven C. LaTourette, OH
Rep. Donald A. Manzullo, IL
Rep. Walter B. Jones , NC
Rep. Judy Biggert, IL
Rep. Christopher Shays, CT
Rep. Gary G. Miller, CA
Rep. Shelley Moore Capito, WV
Rep. Tom Feeney, FL
Rep. Jeb Hensarling, TX
Rep. Scott Garrett, NJ
Rep. Ginny Brown-Waite, FL
Rep. J. Gresham Barrett, SC
Rep. Jim Gerlach, PA
Rep. Stevan Pearce, NM
Rep. Randy Neugebauer, TX
Rep. Tom Price, GA
Rep. Geoff Davis, KY
Rep. Patrick T. McHenry, NC
Rep. John Campbell, CA
Rep. Adam Putnam, FL
Rep. Michele Bachmann, MN
Rep. Peter J. Roskam, IL

Rep. Kenny Marchant, TX

Rep. Thaddeus McCotter, MI
Rep. Kevin McCarthy, CA
Rep. Dean Heller, NV

If any of these people can show proof they stood up and yelled consistently about this problem, then they are a keeper. Notice, I do not care whether you are a Republican, Democrat or Independent. I care only about your objectivity and success in managing problems. If you can’t do your job, get out of the seat, and do not expect a retirement. We, out here in the real world, would get fired for the kind of performance the congressional clowns have provided. And then you have the gall to vote better retirements for yourselves, increased pay and expenses, medical benefits. How you people sleep at night amazes me. The home loans that have been defaulted need to be re-valued to their real home value, then a new mortgage be written at a mortgage pavement the default customer can pay. The banks were truly stupid for not realizing all they had to do was revise failed loans with the home owners. The banks sold the horse crap, adjustable loans to the home owners. You congressmen knew it, and allowed the bankers to walk away from the problem you and they caused.

Congressional Spending must be cut back to Taxes received. The Congress loves to make everything complicated so their speeches are hard to follow. But it is simple budget control, just like in our homes. We have a certain amount of money to spend and we do not have an endless supply of funds. When we run out for the month, that is it. The people who have the government money habit will have to get jobs. Add the financial numbers and stop trying to give us BS. You Congress members need to budget 25% less than what you take in, so that you can start paying down the national debt. A single sheet of paper summarizes where the funds are going to be spent, and we don’t need endless meetings to hear the endless, detail of why you need more money. It is not even thinkable that the debt will not be paid off, and if that means people have to get less and we have to stop supporting the world, so be it. No BS about how dangerous the world is. We ain’t Jesus! When you have a surplus, then you can act like Jesus again! Until then, suck it up and get to work.

1) Close the Iraq war within 12 months;

2) Stop giving free money to all these foreign countries;

3) Close the Pork trough and budget only what we have taxes available for;

4) Cut your salaries for the pathetic jobs you have done, reduce your expenses by 50% and prove both cuts are implemented; get our technology companies involved with Solar, Wind, Compressed Natural Gas, oil and nuclear power. Prioritize which is the best technology to implement first, 2nd, 3rd, etc. and get corporations involved. And by the way, since you are so gracious to yourselves, make sure you provide the same medical benefits to the people as you do your selves. That means you have to drastically cut your medical benefits and see how it really feels and costs. I know this is a major issue, but you don’t rate anymore than average Joe and Jane out here.

5) Get Corporations to bring production back to the USA! Read the tea leaves. They were greedy and thnking only of how to pay the directors, board members and stock holders. Listen to us you corporate Directors, if people don’t have a job, how do you expect they will buy your products. You have PhD’s up there and even I can understand this. You corporate people are the ultimate stupidity for long term business understanding.

6) The market will likely drop to 8000 or 8500, as this is the real value. Get over it. Be productive. Produce the best technology. Let’s get to work. We can solve this by getting good decision makers in the government and Corporations. Don’t permit these greedy directors in Corporations and Financial Institutions to be paid outrageous salaries; and let’s pressure our Congress to reign in their spending habits and pay off the debt in 20 years or less.

Regards, We the People,

8 October 2008

Updates in July 2010 – The Democrat House, Senate and President quietly passed laws in June 2010 allowing Fannie Mae and Freddie Mac to get funds automatically when needed, without approval of Congress and without resolution of the huge losses we are incurring every day. CONGRESS DID NOT SOLVE THE PROBLEM, BUT HID THE PAYMENTS TO THESE TWO GROUPS. In late July 2010, a new Financial Bill was passed focused on banks, but nary a word was directed towards resolution of Fannie Mae and Freddie Mac. So far since August 2008, $145 billion dollars has been sunk into Fannie Mae and Freddie Mac. People, can you imagine how many small businesses we could have helped to stimulate jobs? Who was behind the new Financial law? Senators Barney and Frank! Wow, go Figure! It is quite clear the Democratic House and Senate do not have the courage to make the hard decisions to solve our financial problems and focus on JOBS.

August 17, 2010

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