We’ve been bailed
By: BJ Lawson
When I started this campaign last November, the national debt was tipping the scales at $9.3 trillion. Today it is over $10.1 trillion.
To add insult to this obvious injury, our Senate and then House just passed a juiced-up bailout package that includes an additional $150 billion of random acts of fiscal irresponsibility beyond the $700 billion revolving credit line to be used by our Treasury to buy questionable assets from troubled banks.
The vast majority of Americans were against this bailout, and for good reason — it is not going to work. Economists and those who understand the banking system understand that the administration’s plan will not fix the underlying problems of trust and solvency. Instead, it simply allows our Treasury secretary to pay above-market prices for troubled assets to bailout out foreign and domestic banks. It creates no jobs, gives no significant relief to struggling homeowners, and severely threatens our sovereign credit rating.
Why, then, did Congress commit this act of gross negligence? Why did our incumbent vote twice to support a measure that is ineffective, unconstitutional, and overwhelmingly despised?
He, and they, just followed orders.
I happened to be in Washington this past Wedensday, and was attending a breakfast with a number of other “conservatives” (whatever that means). Among the people at this breakfast were fresh-faced twentysomething staffers playing the power game, including staffers from the White House as well as various political campaigns and think tanks. These staffers know nothing about economics or banking, yet they are sent on a mission to amplify the administration’s message. In particular, they each stood up to address the group and said that the bailout plan was “as good as it was going to get,” and that everyone needed to get behind it for the “good of the country.”
Of course, attempts to engage in discussion were futile — the staffers don’t know the topic, they’re just carrying a message.
Keep in mind that our twenty-year incumbent also voted for this bailout — twice. Yet despite his expressed disagreements with this administration, he continually takes orders from them on critical issues like the bailout and our declining civil liberties.
What conclusion can we draw from these troubling events? We do not live in a Constitutional Republic. At this point, we do not even live in a totalitarian democracy, as the overwhelming majority of constituents were vehemently opposed to this trillion-dollar boondoggle. At best, we are living in a mild form of corporate socialism with a ruling oligarchy that is completely unresponsive to the people.
So where does this leave us?
We’re in a tough spot, and Friday’s economic data left little to the imagination. We had our ninth straight month of job losses, and further corporate consolidations and layoff announcements show further challenges ahead.
Our challenges don’t end in Washington, either. States like California and New York are approaching insolvency, to the point that California is asking for a $7 billion rescue package from the federal government so they can make payroll. More locally, I had the opportunity to interview our North Carolina auditor, Les Merritt, to discuss our state’s situation:
If you live in North Carolina, pay attention to this interview — especially Auditor Merritt’s warnings about so-called “COPs”, or Certificates of Participation. It seems that our state legislators have figured out how to violate our state Constitution by using a means of debt financing for pet projects that avoids the hassle of getting voter approval.
COPs are troubling, as our state Constitution in North Carolina requires that all debt (such as general obligation bonds) be specifically approved by voter referendum. How have they done this? Like our federal representatives, they apparently just don’t care. Unfortunately, things are about to get rough as we continue to live beyond our means in North Carolina, as well as the United States. It’s up to us to remind our representatives at every level how important it is that they follow the rules.
Finally, I’d like to make one more observation about this “new and improved” bailout that was railroaded through the Senate and then passed back through the House. Not only were there $150 billion in new enticements, but CNET is reporting that the bailout bill expands and makes permanent IRS surveillance capabilities, as well:
IRS undercover operations: Privacy invasion?
The bailout bill also gives the Internal Revenue Service new authority to conduct undercover operations. It would immunize the IRS from a passel of federal laws, including permitting IRS agents to run businesses for an extended sting operation, to open their own personal bank accounts with U.S. tax dollars, and so on. (Think IRS agents posing as accountants or tax preparers and saying, “I’m not sure if that deduction is entirely legal, but it’ll save you $1,000. Want to take it?”) That section had expired as of January 1, 2008, and would now be renewed.Starting with the so-called Anti-Drug Abuse Act in 1988, the IRS has possessed this authority temporarily, with occasional multiple-year lapses. A 1999 internal report said the IRS had 126 “trained undercover agents” working in field offices at the time. This is the first time that such undercover authority would be made permanent.
Sens. Max Baucus (D) and Chuck Grassley (R) have been pushing to make it permanent for a while, claiming (PDF) in April that: “Undercover operations are an integral part of IRS efforts to detect and prove noncompliance. The temporary status of this provision creates uncertainty, as the IRS plans its undercover efforts from year to year.”
There’s another section of the bailout bill worth noting. It lets the IRS give information from individual tax returns to any federal law enforcement agency investigating suspected “terrorist” activity, which can, in turn, share it with local and state police. Intelligence agencies such as the CIA and the National Security Agency can also receive that information.
The information that can be shared includes “a taxpayer’s identity, the nature, source, or amount of his income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments, or tax payments, whether the taxpayer’s return was, is being, or will be examined or subject to other investigation or processing, or any other data received by, recorded by, prepared by, furnished to, or collected by the Secretary with respect to a return.”
That provision had already existed in federal law and automatically expired on January 1, 2008.
What’s a little odd is that there’s been little to no discussion of the IRS sections of the bailout bill, even though they raise privacy concerns. Treasury Secretary Henry Paulson said this week: “I will continue to work with congressional leaders to find a way forward to pass a comprehensive plan to stabilize our financial system and protect the American people by limiting the prospects of further deterioration in our economy.” He never mentioned the necessity of additional IRS undercover operations.
Last week was a historic, but bad, week for our nation. It’s time to Be the Change, vote Lawson for Congress, and insist on principled representation in Washington.
October 6th, 2008 at 1:56 pm
Lawson,
Thank you for the insight about the IRS portion of the bill. I would have never known. Also it was interesting to hear about the twentysomethings that are so urgent to bring about a declaration from the higher-ups without any knowledge about the actual situation. We need someone like you in Congress who looks deep into each piece of legislation and demands accountability. David Price needs to go.
http://www.davidcarlsonpolitics.com
October 6th, 2008 at 4:41 pm
Lawson,
I too knew nothing about the IRS implications. I agree with your stance and have gone so far as to call my representative, who was instrumental in getting this atrocity passed (Roy Blunt), my senators, Washington, anyone I could. No one listened. The American people are getting tired of not being listened to. Although you wouldn’t help our state directly, we need more people like you in Congress.
October 6th, 2008 at 5:17 pm
BJ,
One thing that would be a tremendous help for small businesses would be to remove the barriers to selling equity to the public. If you want to start any kind of business today, your only choices are to get the money from relatives, from your own savings, or from a bank. You can’t sell shares to your neighbors and customers without very quickly running into horrendously expensive regulatory requirements.
I’m convinced that this is no accident. If we could invest in new businesses in our own communities, that’s a lot of money that we wouldn’t be entrusting to Wall Street. Of course, the SEC and other bureaucrats will insist that they’re only there to protect us from predatory businesses, but did any of this over-regulation protect any of the shareholders of Enron or any of the other massive failures of the last decade or so?
-jcr
October 6th, 2008 at 5:36 pm
John - you’re exactly right. Raising money to start a business gets into “accredited investors” and lots of paperwork straight out of the gate. Nothing that a few thousand dollars in legal fees can’t cure, but it’s certainly not a chip shot, and the pool of “accredited investors” is somewhat limited.
There are, however, a number of creative options for “customer financed” growth, especially for existing businesses. Here’s an interesting book:
Rethinking our Centralized Monetary System: The Case for a System of Local Currencies (http://www.amazon.com/gp/product/0275953769)
… among other options, this book talks about companies using discount coupons to expand. For example, a sandwich shop that sold “futures”: a certificate good for $1.25 in merchandise for $1.00, redeemable in the future. The immediate cash they received was used to fund an addition to their shop, and the processs gave the purchasers a greater sense of loyalty to the business.
October 6th, 2008 at 7:26 pm
Our entire banking system is a classic “ponzi scheme”, and to add insult to injury, they just passed this “bailout” thet only puts the American people further down the road to nowhere.
The Federal Reserve was enacted at the same time as the IRS, this was no coincedence, so no suprise that these new provisions would be added. The IRS was/is the strong-arm division to make sure the Federal Reserve collects on it’s profits. We’ve all been duped into believing it’s our “patriotic duty” to “voluntarily” give up our hard earned wages to a private banking system. Wow….
The book “The Creature From Jekyl Island” should be required reading for, not only every high school student, but every member of Congress so they can be educated to actually discuss why we are in this mess.
Like BJ mentioned above, I’d love to be able to ask each member of Congress how a dollar bill is created, who creates it, how it is put in circulation, and how each dollar bill puts each American citizen in a debt that can (financially and mathematically) never, EVER, be paid off. That’s right, the national debt was designed (by the crew at Jekyl Island….) to put the American people in never ending debt,ulitimately, leading to the bankruptcy of this country. We are almost there now, unless honest people like Ron Paul and Lawson are willing to finally tell the truth and refuse to be whores to the secret power brokers who operate behind the scenes.
Fight the good fight….
October 6th, 2008 at 7:35 pm
I hope you will win your congressional district. It would be a victory for the people. Maybe than you and Dr. Paul can get the IRS to stop spying on WE THE PEOPLE let alone getting the IRS of all of our backs.
I’ll contribute tomorrow on your money bomb.
October 6th, 2008 at 8:08 pm
Mr Lawson,
I’m glad to see so many contributing. I count as part of the $44,000 and I hope that my contribution looks stupidly small compared to what you get in the next 24 hours. We need more revolutionaries in the House and Senate. That is how change happens, not the voice of one man or two men, but the chorus of many men. There was more than one signatory to the Constitution of the USA, and we’ll need more than one signatory for bills that need to be passed now and in the future.
I have written your name on the inside of my Guy Faulkes mask, along with Dr Paul’s name, and I hope soon to have no room left to write more names. Thank you for standing up, for fighting for the rest of us.
Z, Texas
October 7th, 2008 at 10:30 am
I proudly contributed and give what I can because I fully support you and wish I could vote for you, but as of right now I’m stuck in the very liberal state of Maryland and of course my state representative and senators don’t listen to me (They all voted yes for the bill)!!
Having Ron Paul and now hopefully you representating liberty in Congress gives me hope especially as a young person that we can see this country turn around!!
October 7th, 2008 at 12:39 pm
I want to congratulate you for standing up for liberty in this most trying time. I have donated a small amount twice already. In fact you got more than Dr. Paul… but I want you to know, even though you are not “my” representative, you are still my KIND of representative. There for the more men like you in office, the better off this country will be. One office at a time, one campaign at a time, we must place responsible liberty minded men and women in places of officialdom that will bring true peace, prosperity, and liberty back to this great nation before she falls under the waves of tyranny.
October 7th, 2008 at 5:37 pm
I have to say Barry, I haven’t laughed this hard in years. If a plain jane countryboy from the midwest saw this coming, why didn’t our delightfully incompetent leaders?
October 7th, 2008 at 6:00 pm
I feel like I should be asking “where’s my kiss?” I mean talk about getting @#$%#$! The list of bad things in the bail out are tooooooo numerous to list. That last section on the IRS just takes the cake.
B.J. if you get elected……ONE THING I would like to see changed is that the so called “little” items that get woven into these bills…can NO LONGER be woven, tagged on, added to, or whatever the language used to describe a buried item.
We the people get screwed over and over again by these “little” pearls! Between these add ons and Bush’s presidential directives that he blantantly throws in our faces…….it is enough to make one more than physically ill!
Sorry, I’ll quietly climb down off of my soap box now ~~~….
October 8th, 2008 at 9:33 am
The sudden shift from an atmosphere of paternalistic “things are fundamentally OK” to “TIME TO PANIC” seems designed to stampede this bailout through. They must have had this plan written up over the past year or so, and, realizing they could be running out of time befor the election, they used this strategy to get it through, together with liquidating WAMU to punctuate the urgency. Now, after screwing WAMU stockholders, they are trying other means to buoy the markets. Oops, panic mongering worked all too well, and things are tanking. If dollars and stock are not to be trusted, real estate values should be doing better, reducing that fear of people walking away from their mortgages. Politicans’ answer, of course, is more and/or faster government “help”. Unfortunately, Ron Pauls voters will be dissipated among Ron Paul write-ins, Chuck Baldwin, and Bob Barr, and their voting power may be lost. I read but have not confirmed that Dr Paul endorsed Baldwin. Glad to see more potential politicians who consider their job to be rigidly defined by the Constitution, which is all too unusual in spite of their formal oath. Major decisions of government being subject to direct voter referendum might help. Perhaps a way to referendum criminal inditement of office abusers would also help.
Thankyou for running, Lawson! I am writing everyone I know in N. Carolina about you.
October 10th, 2008 at 2:08 pm
“What conclusion can we draw from these troubling events? We do not live in a Constitutional Republic. At this point, we do not even live in a totalitarian democracy, as the overwhelming majority of constituents were vehemently opposed to this trillion-dollar boondoggle. At best, we are living in a mild form of corporate socialism with a ruling oligarchy that is completely unresponsive to the people.”
I don’t think I’ve ever heard it put better than that. I just wish you were representing Nebraska, or better yet, the USA!
October 24th, 2008 at 12:32 am
We are IN a revolution.
In 1962, John F. Kennedy famously said, “Those who make peaceful revolution impossible will make violent revolution inevitable.”
BJ, please, win this election, and all of us together might just make it a peaceful one.
I believe.
JtP