Archive for December, 2008

December 28, 2008

Serve the majority not the few

In the Sunday St. Petersburg Times two writings drew my attention. On the front page Double Dipping: Ire, but higher, by Times Senior Correspondent Lucy Morgan and in the Hernando Times section Guest column by C.D. Chamberlain, No Local preferences for contracts. Both deal with leadership decisions and their affects. Mr. Chamberlain addresses the issue from a psychological perspective, what is the intent of a policy, for whose benefit and at whose cost, where in economics we call it cost benefit analysis. The Double Dipping writing addresses the outcome of state policy making with a failed decision related to a cost benefit analysis.


Legislatures whether it is State or Local Governments continue to focus on the benefits for the few rather than the majority. We see this at the State Level when politicians, judges, administrators and anyone participating in the State Pension Fund are allowed to Double Dip because of a law written in 2001 by lawmakers, of which some are participating in this loophole. At the Local level in Hernando we see the same cronyism at its best in this new board of County Commissioners regarding Peck Sink. Favoritism for local firms would only be acceptable if that firm satisfied the three key factors in cost benefit analysis, or Social Return on Investment (SROI) something our local official should study when making future decisions. It is an approach to understanding and managing the impacts of a project, or a policy. It is based on stakeholders, the residents and all businesses not just real estate related, in Hernando County and puts financial values on the important impacts identified by stakeholders. The aim is to include the values of people that are often excluded from these decisions and not committees consisting of pre-selected campaign workers and political party supporters.

December 25, 2008

Bailouts- The Cost to Americans II,III

The numbers are in. Can you believe the Economy rescue plan keeps adding up in dollars. Here are some of the figures. Totaldollars allocated to various programs for stimulus or guarantees by our government. Economic Stimulus February 2008 $168 Billion Dollars (actually spent $168 Billion), Bear Stearns  bailout March 2008 $29 Billion (Actually Spent $29 Billion), Discount Window Loans March 2008 $148 Billion (Actually Spent $148 Billion), Fannie Mae and Freddie Mac bailout September 2008 $200 Billion (Actually Spent $13.8 Billion), FHA Housing Rescue October 2008 320 Billion (Actually Spent Unknown), Auto Industry Energy Efficiency October 2008 $25 Billion (Actually Spent $0.00), TARP October 2008  +- $700 Billion( Actually Spent $205) Billion, Money Market Guarantees October 2008 $659 Billion (Actually Spent Unknown), Commercial Paper Funding Facility October 2008 $1.4 Trillion Actually (Spent $303.9 Billion), Unemployment benefit extensions November 2008 $8 Billion (Actually Spent $8 Billion),  AIG November 2008 152.5 Billion (Actually Spent $117.2 Billion), Finally, November 2008 Citgroup loan loss backstop, Term asset backed Securities Loan facility, GSE (Gov Sponsored Enterprises) Mortgage Backed Security Purchases, Debt Purchases and FDIC bank takeovers + 1 Trillion unlimited (Actually Spent $56.7 Billion). This Totals Allocated 7.2 Trillion and Actually spent $2.6 Trillion tax dollars.

Wow, so much for conservatism. The big question is based on pure economics of transactions, for every winner there is a looser. We now know who the loosers’ are.  Who are the winners and where did all this money go? Lets see, if people are loosing their homes, that’s one looser, investors in retirement accounts and pension plans are loose rs, that two more, people are loosing their jobs because of  loss of sales and services, that’s one more, who is winning.

The winners are those who take value (dollars) out of the markets through various investment strategies developed by Wharton School of Business and other economic think tanks educated in these types of schools including Columbia University by developing economic models on specific investment products or pools of stocks designed for one purpose, money extraction to be placed in the pockets of Trading Managers, CEO’s, CFO’s all of which who do not have the slightest care for the American Economic Systems. The tool for execution are derivatives. The initial intent of derivatives was to reduce rick on investments not withdraw asset value out of the market place.

A simple analogy for the layman is this; A well of water (dollars) provided financial institutions with water to cook, drink, and wash. This well water is replenished when it rains (savings) and the rain water seeps into the ground and refills the source for the well to continued to maintain its water level. During droughts the level declines but the well never dries up. What has happened in our financial institutions began using the water to wash cars, water their lawns, and they started bottling it and sold it to others in different packages, and consumed by drinking the water (compensation). The over use drained the well and perpetuated a self created drought.  To the rescue is our Government via the tax payer who will fill the well with future tax dollars for generations to come.

December 20, 2008

The Bush Legacy


 I am amazed at the republican rights’ trying to build a positive image of the Bush Legacy after eight years of failure. Lets’ add up the republican conservative non intervention of government, deregulation, and any other right wing terminology which would define the Republican Administration destruction of the American way of life and dream.


Recently a slew of executive orders favoring multinational corporation to add to the destruction of the ozone layer, and continuing of our dependence on fossil fuels. More than 750 billion to Wall Street and National Banks, over 125 billion to AIG American International Group, with no conditions I may add, and 14 billion with conditions to take power away from unions and to seize limited  control of the three auto makers in this country so that foreign auto makers producing in America have a better advantage.


I know he was elected the president of this country but by his acts he represents the ultimate special interests, which leads me to the main point. Puppet W reminds me of Howdy Doody.  If you remember Buffalo Bob always pulled the strings. Does anyone think that W is capable of making a decision worth any value. He was a man over his head with very little ability to make rational choices. He was incapable to distinguishing between justice for all and just this for the few. He fertilized the greed mentality over the last eight years which has placed us in the crisis we are in today. His organization rivals any organized crime organization since the 20’s. He and his cronies have looted America.

He has violated his oath of office and should be punished for it. There is no excuse for what he has done.   



December 14, 2008

E-mail and the First Amendment

I must clarify a misconception by many who use the internet to communicate. The internet’s creation has been one of the most ingenious aids in complying with the First Amendment of the constitution of the United Sates. It provides the ability to all Americans to express their opinions to a wide range of individuals who choose to read such writings.


An e-mail had been sent to me concerning historical information related to a Nation’s historical growth and subsequent failure and demise. If the sender of this e-mail sent it accidently or intended to send it me, I do not know the answer to this question, yet I read the information and simply concluded that although I may not agree with all of its content I did see some similarities in my conclusions related to the subject. Since I felt that some of my conclusions were similar, I replied to all who had received this e-mail with a link to my Blog. I received a reply the next day from one of the mail recipients that my act was unethical. I apologized, but did not see the reason for the comment. My ethics are intact. If I had to respond in a like manner to all individuals, spam and junk mail sent to me I would have to remain awake 24 hours a day. It was apparent that he visited my Blog and realized that my writings were not in agreement with his thoughts on the subjects I have written about but needed to express a personal attach which leads me to question his principles.


Each day we receive in the US mail an array of opinions on many subjects from many sources. The daily papers are filled with opinions and thoughts that not everyone will agree with. This is what freedom of speech is all about. The sender of the original e-mail choose the group of recipients for a reason, the complaining party needs to contact the originator of the e-mail as well or not open e-mails from unknown senders by just deleting them.  




December 12, 2008

Educators and Legislators

When will our so called representatives become proactive rather than reactive? I wonder sometimes if the root of all of our failure stem from our educational systems of higher learning, systems of education, which have prohibited creativity and the learned ability to set goals and objectives for future planning, and systems where curriculums focus on the now rather than the future. Finally, systems of education which have taken away one of the most important learned abilities necessary for success in any vocation or avocation, teaching our men and women the necessity of moral decision making.


Today we are experiencing the failures of these systems at all levels of leadership in both Government, Services and in Industry, leadership whose main focus is on instant rewards personally rather than long term objectives and rewards for an organization. Rewards for the few rather than the majority.


Even during one of the most critical times in the history of the United States, our Senators and Congressmen are playing politics as usual with the livelihoods of millions of Americans, a congress willing to write a blank check to a corrupt administration for 750 billion dollars yet unwilling to give a loan to a vital industry with specific conditions, and possibly save millions of jobs of hard working Americans. At major fault is the leadership in the auto industry who have lacked the foresight and ingenuity to remodel their cars and industry to compete with the global markets.


Our systems of education need to redirect its emphasis on developing leaders, creators, and educators focused on the common good for all mankind. We need to stop producing politicians and we need to develop leaders with a vision which includes all people. All political science curriculums should be eliminated from all institutions of higher learning.

    Modern political science

The advent of political science as a university discipline in the United States is evidenced by the naming of university departments and chairs with the title of political science shortly before the Civil War. In 1857, Francis Lieber was named the first Professor of History and Political Science at Columbia University. In 1880, Columbia formed the first School of Political Science. The discipline established the American Political Science Association in 1903. Integrating political studies of the past into a unified discipline is an ongoing project, and the history of political science has provided a rich field for the growth of both normative and positive political science, with each part of the discipline sharing some historical predecessors.

In the 1950s and the 1960s, a behavioral revolution stressing the systematic and rigorously scientific study of individual and group behavior swept the discipline. At the same time that political science moved toward greater depth of analysis and more sophistication, it also moved toward a closer working relationship with other disciplines, especially sociology, economics, history, anthropology, psychology, and statistics. Increasingly, students of political behavior have used the scientific method to create an intellectual discipline based on the postulating of hypotheses followed by empirical verification and the inference of political trends, and of generalizations that explain individual and group political actions. Over the past generation, the discipline placed an increasing emphasis on relevance, or the use of new approaches and methodologies to solve political and social problems.

In 2000, the so-called Perestroika Movement in political science was introduced as a reaction against what supporters of the movement called the mathematicization of political science. Perestroikans argued for a plurality of methodologies and approaches in political science and for more relevance of the discipline to those outside of it (Chronicle of Higher Education 2001).

Retrieved from “


Just to note one important fact the 1950’s and 1960’s focused on individual behavioral and group behavior. The 20th century’s greatest invention besides the automobile became available to the American public in those two decades, television. As Edward R. Murrow said “The speed of communications is wondrous to behold. It is also true that speed can multiply the distribution of information that we know to be untrue”. Television has been used as a tool to alter behavior of people and specifically for political gain and not humanities gain.


We need a redirection of purpose in our educational and political systems. The new administration has inherited a morally corrupt financial wasteland. The path to renew our countries direction has many obstacles politically and morally. The solutions will not be simple, we as Americans have overcome much diversity since our independence, let us renew our faith in the American ability to solve any problem, and we can.




December 5, 2008

Bailouts- The Cost to Americans

Today is December 5th, 2008 and the Labor Department has reported that an additional 533,000 jobs have been lost in November increasing total losses for the year to 1.9 million. This brings unemployment to 6.7% as reported.


I have always questioned the statistics being reported for one reason. During my unemployment period from 1989 to 1991 and after six months of unemployment compensation what statistic did I fall under for an 18 month period when I didn’t receive any benefits? I was unreported.


I must question the approach to the initial stimulus and the recent 700 billion bailout package. We all know that Washington D.C. is the address for special interests and influence peddling. Lets first look at the Stimulus package earlier this year February 13th when the Bush, Chaney brain trust attempted an infusion of cash to the American public in hopes that we would spend or pay down our debt. This package was 152 billion dollars which included the approval of Fannie Mae and Freddy Mac limit increase on the number of mortgages they could purchase.  The Fannie Mae, Freddie Mac problems go back to 2005 Ronald D. Utt, Ph.D.  wrote Time to Reform Fannie Mae and Freddie Mac he summed it up as follows the major problems is “Although management’s unearned bonuses have generated most of the headlines, the real cost to the nation is not the tawdry looting of the company by its top management team. The real problem is the concentration of risk in the hands of two massive and privileged companies that now dominate America’s housing finance markets.” Hence their buy out when mortgages continued to default at an alarming rate by the U.S. Government sanctioned by Hank Paulson at the bequest of leading corporate CEO’s and CFO’s of all your major Banking and  Investment Banking Firms. The risk associated with these mortgage backed securities had been repackaged over the years into various forms of derivative products and sold to worldwide financial institutions. When the cash flows from mortgage backed securities ceased the cash flows on these derivative products could not be met. Subsequently, capital requirements governing these financial institutions could not be met because of two reasons. They were short the cash and the value of their assets and derivatives were becoming worthless. The administration publicized that there was a credit crunch. In realistic terms there was no cash to lend out. The money pit was dry because the corporate officers and traders around the world siphoned all the cash off the top in the form of performance bonuses based on theoretical mark to market pricing of securities. This was the method of looting. 


The second bailout of 700 billion although an attempt to fund these cash flows is just a drop in the bucket. It is unknown the value of the derivatives and the underlying asset cash values in this entire mess. The attempts are to throw enough cash around to re establish a credit market. This approach has guaranteed major depositor balances to prevent a run on the banks. It also protects the wealth of those who created this mess sanctioned by our outgoing administration and their supporters. Recently, you have heard some commentary that we need to bail out those mortgages being foreclosed on. Not to be critical of their thought process, but I always thought that you attack a problem at the source to fix it. Wait, they are Wall Street and Banking who loosened the rules for profits and bonuses. My point is that if these institutions wanted to help the common man they would refinance any troubled mortgage at lower rates and extend the amortization periods where their monthly payments would be affordable with no exceptions even if it takes 60 years. By than the markets would have stabilized, hopefully with in the next 10 years, and just possibly housing prices would have reached the same price level of this last surge therefore eliminating short sales. Than again there wouldn’t be too much profit in it for them?

I learned one thing many years ago in my economics classes, for every winner there is a looser in a transaction, in this crisis the common man is the looser and he didn’t even trade. What he is loosing is as follows: his home, his job, his savings, his family and finally his faith in his government to protect him from foreign and domestic enemies.

December 3, 2008

County Commissioners Need Guidance Counselors

Today’s St PetersburgTimes front page by Barbara Behrendt ” Officials Talk of action, then seek more talk”. From a constituents perspective, and one who understands leadership roles, I must question the ability of the County Commissioners, and their need to delegate, a key word, to other committees their thought process. Do any of them have the slightest idea why they ran for office? Did they think that their responsilities are to create as stated by Janey Baldwin, a second legislative body. One that wasn’t elected by the people of this county. Thanks for the reality break from Janey Baldwin, it seems she’s was the only logical one in that room. 

Mr Russell wants to model the Counties Governmental process after the States Model. That is exactly what Hernando County Government needs more bureaucracy.  He also suggests, that we need to have infrastructure projects ready for the promised state and federal stimulus packages. Now that was original!  The rest of the Commissioners sound like they are still running for office. 

I just wonder why we have this group of county commissioners? Sounds like they don’t want to make any decisions unless they were hatched from a committee. I believe the answer is, when recommendations are made by these “Standing Committees” and approved by a majority of the commissioners, no one will take responsibility for its failure. Therefore, the buck didn’t stop at their desk.

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