Yeah, look at the success the govt has been with

• Dems Target Private Retirement Accounts - see link inside
  • take my guns AND take my money??? - no way!! sm
  • Is this real? - cnh
  • Thanks for posting this - see message - New Englander
    • Yeah, look at the success the govt has been with - Social Security... not! nm

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Glad to see you made it.  This board was very confusing for me when they changed it.  Wasn't sure for a while where I was going to end up half the time!!!

I'm kicking myself because I didn't see that interview you described above.  And I'd been watching O'Reilly a little bit more often than usual, too.  Have been much busier with work lately.  Maybe I could visit the website and find the transcript, although your description of it upset me enough, and I'm not sure I want to be upset today.  To me, there are just some people who are off limits to attack, and families of soldiers who were killed in Iraq (especially mothers) are those people!  I've seen parents in the past who were still supportive of the president after their child was killed, and I totally respected every single word they said.  Then there are also parents like Ms. Sheehan and Kesterer, whose opinions I also respect. 

If anyone has a right to object to this war, it's the mother of a slain soldier who has made the ultimate sacrifice.  O'Reilly should be suspended like Novak was.

Anyway, it's really nice to see you here, and I hope you find this a safer, more pleasant place to be than the Conservative board (sans the obvious posters who are only here to insult and harass).

Have a great day! 

A war is not a success until it is over.  While it is continuing, it is simply called a war.

Welfare Reform Reauthorized

Healthy Marriage, Fatherhood Initiative Approved; Work Requirement Strengthened

Today, President George W. Bush signed the Deficit Reduction Act of 2005, which reauthorizes the Temporary Assistance for Needy Families (TANF) program administered by HHS’ Administration for Children and Families (ACF).

"The reauthorization of the TANF program takes the next step in welfare reform by strengthening work requirements and providing the assistance families need to climb the career ladder," HHS Secretary Mike Leavitt said. "Welfare reform is helping millions of people climb out of poverty. Now, we want to go the next step and help them climb the job ladder by creating more opportunities for education and job training."

The new law maintains the same 50 percent work participation requirement for states as before. However, prior to today’s reauthorization, a caseload reduction credit allowed states to reduce their work requirement by their caseload decline since 1996. As most states experienced dramatic caseloads declines, the credit had virtually eliminated the work participation requirements for most states.

Today's reauthorization recalibrates the base year for calculating the caseload reduction credit and also closes a loophole to include separate state programs in the work calculation. These changes effectively re-implement a meaningful state work participation rate requirement as envisioned by the architects of welfare reform back in 1996.

"The reauthorization of welfare reform, with its strengthened state work participation rate requirement, supports the Bush Administration's goal of ending the crippling cycle of welfare dependency," said HHS Assistant Secretary for Children and Families, Wade F. Horn, Ph.D. "Welfare reform is a success because more families and individuals are working and entering the economic mainstream and fewer children are growing up in poverty."

Today's reauthorization includes $150 million to support programs designed to help couples form and sustain healthy marriages. Up to $50 million of this amount may be used for programs designed to encourage responsible fatherhood. In its welfare reform law of 1996, Congress stipulated three of the four purposes of the TANF block grant to states be related to promoting healthy marriages.

"A key component of welfare reform is supporting healthy marriages and responsible fatherhood," Dr. Horn added. “Approval of these funds will help to achieve welfare reform's ultimate goal: improving the well-being of children."

The Healthy Marriage Initiative, administered by ACF, was created in 2002 by President Bush to help couples who have chosen marriage gain greater access to marriage education services, on a voluntary basis, where they can acquire the skills and knowledge necessary to form and sustain a healthy marriage. Funding for responsible fatherhood includes initiatives to help men be more committed, involved and responsible fathers, and the development of a national media campaign to promote responsible fatherhood.

The welfare reauthorization provisions also made several improvements to the child support enforcement program, including a change that will provide more support directly to families, especially those who have left welfare.

For more information on the Healthy Marriage Initiative, view: http://www.acf.hhs.gov/healthymarriage/.

So what are you saying?  That it is fair for them to admit incompetence, whine for help and take the people's money, but its nobody's business what they spend it on?  Corporate welfare has got to stop!

This is no different than if a relative came begging for help making their house payment, you gave it to them, then instead they blew it on caviar and a cruise - and expected/demanded more money from you in the future.  Would you feel you had the right then to tell them what to do with it?  Or would you refuse to give them another cent and let them crash and burn?

In this society, when an individual admits their incompetence and declares (or has concerned others prove) they are unable to handle their affairs, they are made a ward of the court with a guardian or a committee of guardians to tell them what to do with their money and their lives.  This is not a temporary situation (such as individual welfare is supposed to be), the government has more huge payments to AIG scheduled.   Yes, there should be strings attached to the money - BIG ones.

My first real job some 30 years ago was a CETA job. That was Comprehensive Employment and Training Act. This was doing medical transcription for a county health department.  I worked as a CETA employee for a year, they trained me and paid me, and I have worked in transcription for 30 years, of course moving on to hospital stuff. Made big bucks for quite a few years and now here I am, strangely enough, I think back to the same money I made all those years ago.  You've got to keep your sense of humor. 

The Federal Reserve (Fed) has gone beyond playing with fire, and may have indeed set the house on fire. It’s one thing to push interest rates to near zero to stimulate the economy; it’s another to “monetize the debt” by printing money to buy government debt. In recent weeks, the Fed has broken outside even those boundaries and become actively engaged in managing the private sector beyond the core banking system. Worse still, the steps taken may be difficult to reverse and as such may shape the U.S. economy for a long time. These steps are taken with the best of intentions, to “save” the economy. The only trouble is that we may be on a slippery slope to destroying capitalism on the way. In “doing whatever it takes” to get the economy back on its feet, the Fed risks destroying the foundation of why the U.S. has been able to establish itself as the world’s leading economic force. Actively participating in credit allocation within the private sector, the Federal Reserve (Fed) jeopardizes the capitalist foundation the U.S. economy is built on. As a result of these actions, the U.S. may be on its way to becoming a modern incarnation of a planned economy.

Why these harsh words? To understand what is so frightening with recent Fed activity, consider that most central banks focus on interest rates, inflation and money supply to promote price stability (and maximum employment in the Fed’s case). Generally, they all influence credit creation by managing the cost of borrowing. Central banks may employ slightly different levers and targets; and while some central banks are better than others at achieving their goals, what they have in common is that they traditionally focus on government debt, mostly short-term Treasuries, to achieve their goals. This is very much by design as good central bank policy leads to an environment of price stability fostering long-term economic prosperity. On the other hand, bad central bank policy may lead to inflation, wide swings in economic activity or unnecessarily high unemployment. However, free market forces will push the private sector to make the best of it. It’s when policy makers start subsidizing ailing sectors of the economy that distortions are created that will come back to haunt us. Traditionally, for better or worse, elected officials decide on the socio-economic fabric of society. Now, the Fed decides which areas of the economy need to be propped up.

Creating Hysteria To Pursue Policies

The hysteria that has been created by policy makers and the media has allowed the Fed to pursue its recent unorthodox policies. In late September, the world financial system looked rather dire; the government was able to play a role to avoid a disorderly collapse; but the government’s role should have been limited to allowing an orderly adjustment of the excesses of the credit bubble. Instead, the latest salvo to promote the bailouts is that payrolls have dropped by the largest amount since World War II. This may be the case in absolute numbers as the population has grown, but more jobs were lost as a percentage of the workforce in a twelve month period in each of 1982, 1961, 1958, 1954, 1948/49; in many of the cases more than twice as many. Recessions are no fun, neither are personal or corporate bankruptcies; but they may be the cure needed to weed out the excesses of the boom. In contrast, today, hedge fund managers that ran their funds into the ground are raising hundreds of millions of dollars to start anew. Some of the folks that ran Long Term Capital Management into the ground in 1998 started fresh only to have another massive failure in the current credit crisis. We don’t expect the new breed of second chances to be any better. And while the blame lies with the managers, excessively low interest rates contribute to irrational risk taking: all of the bailouts focus on those who have been over-leveraged. What about the group of responsible savers that rely on income? With interest rates near zero, many are tempted to engage in highly leveraged strategies to meet their required income objectives. Pension funds “must” return 6% per year, leaving them little leeway but to give money to hedge fund managers to magically turn 1% yields into 20% returns; the way to achieve this is with leverage. Actually, there is another way: the Swiss public pension fund system just announced that it will scale down its long-term return objective to 4% from its current 6% per annum.

Giving Credit Where No Credit is Due

In late December, the Fed Board of Governors approved GMAC’s application to become a bank. The vote was 4-1, and the one board member with experience as a bank regulator, Elizabeth Duke, dissented. There was another hurdle: GMAC, General Motors’ finance arm, did not have sufficient capital to be a bank. That problem was solved, too, in early January, as the Treasury injected $5 billion into GMAC; the Treasury also GM $1 billion, so that GM could inject that money into GMAC. Equipped now with a minimum capital base, GMAC is able to operate as a bank, go to the Fed to access the TARP program, as well as other regular and emergency Fed windows.

In December, car sales fell off the cliff. But it wasn’t only GM that had problems; even Toyota that had access to credit and introduced zero percent financing, recorded a 37% plunge in sales (unlike other car makers, Toyota has traditionally not offered zero percent financing). Shell-shocked consumers are worried about their jobs and have lost a substantial amount of their net worth in 2008; further, incentive programs prior to the bursting of the credit bubble lured consumers into 6-year loans with zero percent financing. Consumers simply don’t want or need a car right now. Policy makers take this as a reason to provide money to GMAC that pursues a business model proven to be ruinous: it simply doesn’t make sense to offer cars at 0% if interest rates are above that, even if they are “close to zero” as they are now. GMAC takes money from the Treasury to be able to request more from the Fed. And the first course of business for GMAC is to extend zero percent financing to consumers with lower credit ratings than had traditionally qualified.

Difficult to Unwind: Long Term Inflation Likely

The Fed is only ramping up its mission to allocate credit where the Fed – rather than the free market - deems it appropriate. A major program announced in the fourth quarter, but rolled out in early January consists of a $500 billion program to buy mortgage-backed securities (MBS). The perceived positive is the plummeting of mortgage rates. Consumers with superb credit now qualify for 30-year mortgages at less than 5%. One problem with such programs is that the Fed intentionally inflates prices (lowers the yields) on these securities; in turn, rational market participants may abstain from buying them. As a result the Fed risks replacing private sector activity, rather than encouraging it. Furthermore, the Fed jeopardizes the dollar as foreigners may be discouraged from buying U.S. government and agency security debt; given that the U.S. has become dependent on foreigners to finance its spending needs as well as the unprecedented debt that will be financed in 2009. This is a very dangerous road to be on.

The Fed may be able to phase out its commercial paper subsidy program or drain liquidity from the TARP program over time; however, the $500 billion MBS program may be difficult, if not impossible to unwind. Indeed, the design of the MBS program calls for holding of the securities until maturity. For practical purposes, this means that the Fed’s balance sheet is not just “temporarily” inflated, but that the Fed will permanently keep more money in the economy. Traditionally, the Fed’s balance sheet is $900 billion. Therefore, even if one gives the Fed the benefit of the doubt that the current escalation to over $2 trillion is temporary, there will be a significant hangover as not all additions can easily be removed. This doesn’t even consider that, quite likely, the MBS purchase program may need to be extended beyond the 6-month period it was put in place for. Watch for bond manager Bill Gross this June, calling for the Fed to continue buying MBS, preferably the ones he has on the books, to save the economy from collapse. Incidentally, his firm, PIMCO, is one of the firms managing the Fed program.

To counter the effects of this added money in the economy, the Fed would need to keep interest rates permanently higher. One realistic alternative, however, is that the additional money will stay in the economy as draining it would cause too much economic hardship. This may well embed inflation into the U.S. economy for years to come. Importantly, note that there is little, if any, accountability at the Fed monitoring its actions; no one is there to ensure that the Fed will, at some point, phase out its programs or added powers.

Live Free Or Die

By engaging in credit allocation to specific sectors of the economy, the U.S. is stepping into a territory traditionally left to governments with a socialist or communist brand. Communism has shown us that planned economies don’t work. New Hampshire in 1945 added the slogan “Live Free or Die” to its state emblem, a quote stemming from a general in the Revolutionary war. Translated to the economic crisis, this should mean that a severe recession ought to be the lesser evil than a planned economy. And to continue the parallel, when communism swept Eastern Europe, the standard of living for everyone dropped. In today’s world, we already see that the “re-failure” rate of those who defaulted, then renegotiated their teaser rate loans, is above 50%. Yet all taxpayers have to pay the price for the bailouts.

To be sure, we are a far cry from communism. But we must keep our eyes open and not be blinded by the perceived “help” of money printed by the Fed. Debt is the origin, not the solution to the problems we face. The Declaration of Independence’s “life, liberty and the pursuit of happiness” may be difficult to achieve when drowned in debt; building sustainable wealth without the shackles of debt may be the more appropriate path. It’s not by mistake that the Founding Fathers be backed by a precious metal that cannot be inflated to give in to the temptation of the day.