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Steps to REALLY fix the Economic Crisis

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Steps to REALLY fix the Economic Crisis

Old 10-06-2008, 10:17 AM
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Default Steps to REALLY fix the Economic Crisis

Since the $700 Billion bailout isn't going help given today's freefall in the DOW. Below are steps that I believe would get us out of our current economic crisis. They were writte by Larry Anderson on AmericanThinker.com today. Full article here -> ARTICLE

Assuming that this bailout plan was necessary and that it stabilizes our credit (at least for the short term), the time has come for a free market strategy to insure long-term capital growth in America. Here is a list of suggestions:

1. Privatize Fannie and Freddie. Every homeowner who reads this article will remember purchasing that first home. For most of us the process was daunting. A hefty down payment was required. We knew that homeownership was much more of a responsibility than it was a right.

There is no reason whatsoever to keep the corrupt and unnecessary GSEs Fannie Mae and Freddie Mac alive at taxpayer expense. Since their inceptions, both of these GSEs have served as little more than leftist utopian playgrounds.

Sleaze thy name is Government Sponsored Enterprise. The top executives of these two GSEs, politically appointed executives, have stolen hundreds of millions of dollars in so-called "performance bonuses" from Fannie and Freddie. Christopher Dodd, the chairman of the Senate Banking Committee, has received over a hundred thousand dollars in campaign contributions from the very GSEs he is supposed to oversee.

Owning a home is part of the American Dream. It should once again require thrift and saving. Homeownership is certainly not a constitutional prerogative.

2. Repeal the Community Reinvestment Act (CRA). Like Fannie Mae and Freddie Mac, this is another leftist quixotic nightmare. The CRA has put hundreds of thousands of low-income people into houses that they could not afford. It has forced private banks ("blackmailed" is more accurate) to put billions of dollars into risky "subprime" loans.

Ignored in the Fannie, Freddie, and CRA debacle are the middle-class property owners and investors who have played by the rules of the private market. These Americans have lost staggering amounts of money in the burst of the housing bubble -- a burst and a bubble caused, to a great extent, by the federal government's meddling in the housing market.[v]

3. Repeal the capital gains tax. If money is needed in the capital markets why tax it? Leave it there.

A lot of countries have dumped this tax in the last twenty years. Repealing the capital gains tax in the U.S. would free up around 100 billion dollars a year for the market.

4. Reduce the corporate tax rate. Corporations pay about 350 billion dollars a year in taxes. If they really need the money -- let them keep the capital that they already have.

5. Fix the mark-to-market ("fair value") rule. The SEC was given the authority to "study" current mark-to-market rules in the bailout bill. (See section 133 of the legislation.)

The government should alter its mark-to-market rules -- and soon. The "book value" of a stock is not the (arbitrary and external) mark-to-market value. Some sort of rolling market average should be used in place of the mark-to-market value. This would allow stocks to be traded at more realistic values.

6. Repeal the Humphrey-Hawkins Full Employment Act. Fed Chair Bernanke has admitted that the dual mandate (long term stability of the dollar and short term "full employment") of Humphrey-Hawkins is unachievable. The major effect Humphrey-Hawkins has been to destabilize the dollar.

7. Repeal Sarbanes/Oxely. The so-called SOX act was put into place to prevent exactly the kinds of abuses that have led us into this crisis. It hasn't worked and has clogged up the financial system with a myriad of obtuse accounting regulations. Start up fees for meeting SOX requirements (for private companies seeking to go public) run about 3 million dollars a year.

8. Drill. Drill. Drill. We send 1.15 billion dollars every day out of this country to purchase foreign oil. If we made this country energy independent we would pump almost that much money into the economy every year. We need to free up all access to domestic fossil fuels and deregulate the building of nuclear power plants. And we need to do it now.

Aggressively pursuing energy independence would add billions to our economy and provide tens of thousands of new, high paying, American jobs. More than anything else we can do, unleashing access to all of our fossil fuel reserves (there are plenty of them) and unharnessing the nuclear power industry would help provide the long term economic and energy stability this country so desperately needs.

9. Privatize Social Security. The Social Security system has to be fixed someday. Why not start now? The federal government collects nearly 20 billion dollars every day in SSI payments. This money is presently funneled into the world's biggest Ponzi pyramid.

A slow but steady shift of these funds into private retirement accounts would provide long-term stability for our capital markets.
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Old 10-06-2008, 10:30 AM
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Default Re: Steps to REALLY fix the Economic Crisis

Makes a lot of sense. And that is the reason it'll never happen.
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Old 10-06-2008, 10:32 AM
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Default Re: Steps to REALLY fix the Economic Crisis

Watch out, you'll be accused of being a right winger if you are not careful.
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Old 10-06-2008, 10:36 AM
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Default Re: Steps to REALLY fix the Economic Crisis

I like the idea of privatizing social security ALOT. Let me manage my own money. At least i'd get something when I retire. If i'm ever able to retire.
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Old 10-06-2008, 10:41 AM
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Default Re: Steps to REALLY fix the Economic Crisis

We should go to a breeder reactor economy and promote plug-in electric cars. Less pollution, energy independence and better for the environment all around. We will always need some gas/diesel vehicles but electric is the way to go for commuter vehicles.
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Old 10-06-2008, 03:19 PM
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Default RE: Steps to REALLY fix the Economic Crisis

Lively-Lines - 10/6/2008 1:17 PM

Since the $700 Billion bailout isn't going help given today's freefall in the DOW. Below are steps that I believe would get us out of our current economic crisis. They were writte by Larry Anderson on AmericanThinker.com today. Full article here -> ARTICLE

Assuming that this bailout plan was necessary and that it stabilizes our credit (at least for the short term), the time has come for a free market strategy to insure long-term capital growth in America. Here is a list of suggestions:

1. Privatize Fannie and Freddie. Every homeowner who reads this article will remember purchasing that first home. For most of us the process was daunting. A hefty down payment was required. We knew that homeownership was much more of a responsibility than it was a right.

There is no reason whatsoever to keep the corrupt and unnecessary GSEs Fannie Mae and Freddie Mac alive at taxpayer expense. Since their inceptions, both of these GSEs have served as little more than leftist utopian playgrounds.

Sleaze thy name is Government Sponsored Enterprise. The top executives of these two GSEs, politically appointed executives, have stolen hundreds of millions of dollars in so-called "performance bonuses" from Fannie and Freddie. Christopher Dodd, the chairman of the Senate Banking Committee, has received over a hundred thousand dollars in campaign contributions from the very GSEs he is supposed to oversee.

Owning a home is part of the American Dream. It should once again require thrift and saving. Homeownership is certainly not a constitutional prerogative.

2. Repeal the Community Reinvestment Act (CRA). Like Fannie Mae and Freddie Mac, this is another leftist quixotic nightmare. The CRA has put hundreds of thousands of low-income people into houses that they could not afford. It has forced private banks ("blackmailed" is more accurate) to put billions of dollars into risky "subprime" loans.

Ignored in the Fannie, Freddie, and CRA debacle are the middle-class property owners and investors who have played by the rules of the private market. These Americans have lost staggering amounts of money in the burst of the housing bubble -- a burst and a bubble caused, to a great extent, by the federal government's meddling in the housing market.[v]

3. Repeal the capital gains tax. If money is needed in the capital markets why tax it? Leave it there.

A lot of countries have dumped this tax in the last twenty years. Repealing the capital gains tax in the U.S. would free up around 100 billion dollars a year for the market.

4. Reduce the corporate tax rate. Corporations pay about 350 billion dollars a year in taxes. If they really need the money -- let them keep the capital that they already have.

5. Fix the mark-to-market ("fair value") rule. The SEC was given the authority to "study" current mark-to-market rules in the bailout bill. (See section 133 of the legislation.)

The government should alter its mark-to-market rules -- and soon. The "book value" of a stock is not the (arbitrary and external) mark-to-market value. Some sort of rolling market average should be used in place of the mark-to-market value. This would allow stocks to be traded at more realistic values.

6. Repeal the Humphrey-Hawkins Full Employment Act. Fed Chair Bernanke has admitted that the dual mandate (long term stability of the dollar and short term "full employment") of Humphrey-Hawkins is unachievable. The major effect Humphrey-Hawkins has been to destabilize the dollar.

7. Repeal Sarbanes/Oxely. The so-called SOX act was put into place to prevent exactly the kinds of abuses that have led us into this crisis. It hasn't worked and has clogged up the financial system with a myriad of obtuse accounting regulations. Start up fees for meeting SOX requirements (for private companies seeking to go public) run about 3 million dollars a year.

8. Drill. Drill. Drill. We send 1.15 billion dollars every day out of this country to purchase foreign oil. If we made this country energy independent we would pump almost that much money into the economy every year. We need to free up all access to domestic fossil fuels and deregulate the building of nuclear power plants. And we need to do it now.

Aggressively pursuing energy independence would add billions to our economy and provide tens of thousands of new, high paying, American jobs. More than anything else we can do, unleashing access to all of our fossil fuel reserves (there are plenty of them) and unharnessing the nuclear power industry would help provide the long term economic and energy stability this country so desperately needs.

9. Privatize Social Security. The Social Security system has to be fixed someday. Why not start now? The federal government collects nearly 20 billion dollars every day in SSI payments. This money is presently funneled into the world's biggest Ponzi pyramid.

A slow but steady shift of these funds into private retirement accounts would provide long-term stability for our capital markets.


You've got my vote for POTUS.

The reason this won't get done is that it takes micro-management levers away from government, and both Ds and Rs are loathe to do that.

Sox is the biggest exercise in form over substance ever concocted.

H-H - talk about arrogance. We wanted to wipe out the business cycle by fiat.

All of the policies we want to get rid of are leftist socialist junk that has never worked, whether introduced by revolution or in the case of the U.S. by devolution.

In a few generations, they are going to look back and see just what we have squandered away in the dual name of corporate greed and "progressive" social policy.

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Old 10-06-2008, 03:53 PM
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Default RE: Steps to REALLY fix the Economic Crisis

All good suggestions, but to really fix it, you MUST do one thing first. Retro-active term limits on all US Congress / Senate! When we get some lawmakers in Congress who care more about our country than they do about getting re-elected, these problems will be fixed. Maybe we could evenn get some sort of flat tax.
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Old 10-07-2008, 09:52 AM
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Default RE: Steps to REALLY fix the Economic Crisis

Back-in-Black - 10/6/2008 6:53 PM

All good suggestions, but to really fix it, you MUST do one thing first. Retro-active term limits on all US Congress / Senate! When we get some lawmakers in Congress who care more about our country than they do about getting re-elected, these problems will be fixed. Maybe we could evenn get some sort of flat tax.
I'm all for that! Make step #10.
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Old 10-08-2008, 05:53 AM
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Default RE: Steps to REALLY fix the Economic Crisis

One last step.
Require any person that runs for office to have made a payroll for at least a year in a profitable company with at least 2 employees not counting themselves.

Ban anybody on welfare and who lives in section 8 housing from voting.

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