This is both a positive and a negative for the government (but mainly good for the people). Wednesday evening the Senate voted to extend the first time home buyers tax credit AND unemployment benefits.

The positives are obvious for the people, but why is this decision a mixed bag for the government?

On the positives:

• The tax credit will help the GDP
• Unemployment benefit extension will keep money flowing for purchases, albeit small, and can provide politicians with votes

On the negatives:

• The money has to come from somewhere. Taxes anyone?
• Creating and extending a situation where there is a potential small home bubble once again
• People will end up on the official unemployment record longer

This will help a number of people but how at what expense to the nation long term?

11/5/09 UPDATE – Just an FYI, the House also approved. Unemployment will be extended an extra 20 weeks.

Just when you thought the horror show that is Illinois politics was coming to an end more information surrounding the appointment of “Senator” Burris, the replacement for the vacant Barack Obama Senate seat, has come to the attention of the public. Wouldn’t you know it, Roland Burris offered to write a check to then Governer Blagojevich.

Sen. Roland Burris was recorded on an FBI wiretap suggesting that he could write a check to former Gov. Rod Blagojevich’s campaign before the ousted governor appointed Burris to the Senate.

Sources say that on the tape, Burris suggests that he could contribute, or have associates contribute, money to the Blagojevich campaign. Burris also expresses desire to be appointed to the U.S. Senate.

Burris’ lawyer, Timothy Wright told CBS 2 that after that conversation, Burris decided against making any contribution. However, the Sun-Times reports that Burris never disclosed that information in an affidavit detailing his actions before he was appointed by Blagojevich.

Doesn’t anyone find it coincidental that Burris is doing exactly what the federal prosecutors accused Blagojevich doing –  Soliciting bids for the Senate seat. Burris is just as crooked as Blagojevich.  He knew exactly what he was doing when he made the offer, just like he was very aware of the fact that he “forgot” to disclose the information while the affidavit was being drawn up.

I’m waiting to hear Burris play the race card, just like I am waiting for him to come out and say that he was “misquoted” or “misunderstood”. The U.S. Senate Ethics Committee need to wake up and give this guy the ax.  He, and his placement by Blagojevich, is a disgrace to the political system.  I just hope someone has the balls to stand up and say enough is enough.

First, I love having Monday off.

I have the luxury of working “flex-hours” at my job, which allows me to have an extra day off per week as long as I still work 40 hours during the week.  The one side effect that I never expected was the reduced stress level.  If you find your stress level to be high due to your work schedule, I suggest you investigate a 4 day work week.

Taken

I have a strong desire to see the movie “Taken”.

Originally, I wasn’t sold on the movie simply because it seemed there was a really, really, strong marketing push for the movie.  Usually, that is a sign of a studio trying to dump a junk movie on the market.  Add in the fact that it was released in January, a dumping ground for bad movies, and it seemed like a mix for a bad release.

Over the weekend I did some reading up on the movie and it appears that there is the potential for a good, yet mindless, thriller on our hands. Rottentomatoes.com has this listed at 56% fresh, so I’m still taking a bit of caution, but I’m still looking forward to it.

Oh, and FYI, the movie was originally released in October, 2008, in the UK and finally found its way over to the United States.

Stimulus Bill H.R. – 1

Thanks to the miracle of Opencongress.org I’ve been able to really dig into the Stimulus Bill (HR-1) that passed the house last week.  In no way am I anywhere finished reading the entire Bill, but there are two initial thoughts that I have.

There a number of limitations that follow a distinct protectionism point of view, such as…

None of the funds appropriated or otherwise made available by this Act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron and steel used in the project is produced in the United States.

I am seeing a number of items that I would be hard pressed to believe would help stimulate the national economy, such as.. 

• $1,000,000,000 for periodic censuses and programs 
• $650,000,000 for the digital-to-analog converter box program 
• $400,000,000, for habitat restoration and mitigation activities. (NOAA)

Again, I am not close to finishing the bill but that is a large sum of funding for activities that would have very little impact on the economy at large.  Interestingly, $650,000,000, was set aside for: 

reconstruction, capital improvement, decommissioning, and maintenance of forest roads, bridges and trails; alternative energy technologies, energy efficiency enhancements and deferred maintenance at Federal facilities 

Now, I can see how that would start to pump funding into local and national markets, but I find it interesting that it’s the same exact amount for the digital-to-analog converter box program.  I just don’t see how they can justify those amounts. 

As for the idea of protectionism… while I understand the desire and need to keep the funding within the United States, protectionism during recessions/depression is a very dangerous idea. The United States had a protectionist viewpoint during the Great Depression which only worsened the economic climate due to a decline in global trade.   

It will be interesting to see how the Stimulus Plan plays out this week in the Senate.  Will the politicians in D.C. Get the idea that this bill is padded with activities, while maybe needed, are not intended for “stimulate” the economy as a whole?

Cars, cars and more cars…

I had an observation this weekend that I found, well, intriguing.  As I was out driving around I noticed 7 new cars on the road, as identified by the temporary plates on the cars.  Now I obviously don’t know if they were “new” or “used”, but I wonder if consumers are starting to feel better about about making these “large” purchases.

Ok, I’m off… until tomorrow.

As of roughly 4:38 PM central time, Rod Blagojevich was no longer the Governor of Illinois.  Almost immediately after, Democratic Lt. Governor Patrick Quinn was sworn into office.  Sure, Blagojevich, made a pointless hour long speech today, trying to say he did nothing wrong, but if he really wanted to prove his innocence… maybe he would have wanted to show up at the trial instead of running around New York making talk show appearances.

What I find really interesting to see is how quickly Senator Roland Burris threw Blagojevich under the bus – “it shows loud and clear that there were serious hurdles keeping the governor from doing his job.”  It didn’t keep him from doing his job when he appointed you to the vacant Senate seat, did it now Senator Burris?

I know that political machine of today seems to have corruption interwoven into all aspects of it, but when the corruption is finally stopped – when the blatant abuse of power is confronted – it’s a wonderful thing to see.  

See ya, Blago.

The Stimulus Plan

So I am having a hard time finding specific information regarding all aspects of the Stimulus Plan, and I don’t really have the time to read it line by line right now, but I may have to in order to dig up the facts.

The two things I did find, however, I am rather bothered by.

1. Undocumented immigrants who are not eligible for a Social Security number can file tax returns with an alternative number. A House-passed version of the economic recovery bill and one making its way through the Senate would allow anyone with such a number, called an individual taxpayer identification number, to qualify for the tax credits.
2. The Make Work Pay Credit also would be refundable, meaning that even tax filers without any income tax liability — typically very low-income workers — would receive one.

The point of number 1 could be seen a number of ways.  Being the cynic that I am, I see a large push by the Democratic party to buy the votes of hundreds of thousands of potential voters.  Why potential?  The “undocumented immigrants” is a nice way of saying “illegal”.  Eventually the Democratic majority will push to legalize “undocumented immigrants”, and they will be successful, and when the next round of elections comes calling they will remember who fought for, and successfully provided them, money.

As for point number 2…If you do not pay income taxes, you should not be getting income taxes back.  That is the whole point of a tax refund – you are refunded money you gave in the last year.  Kinda hard to refund something you didn’t pay, isn’t it?  In order to provide the capital for a refund to those who didn’t pay income taxes means the country will need to add additional debt and/or raise taxes.  

Let’s cut through the political speak and call it what it is: socialism.  

People should read up on Marx to see what comes after socialism.

Obama’s Letter to Iran

I find this to be very, very interesting.  

President Obama is drafting a letter to Iran, specifically to Ayatollah Ali Khamenei , in hopes of opening official US-Iranian relations.  I find the choice of Khamenei to be very interesting because the US administration is bypassing the President of Iran.  Could this be a political move to have the Ayatollah support another candidate, say like Seyd Mohammad Khatami, who happens to be seen as a reformer as well as a positive force in US-Iranian relations…

If this letter is sent, does this also mean the US foreign policy of not talking  (well, negotiating) with terrorist organizations?  If that is the case, I wonder what the impact of such a decision will be AND does the U.S. Department of State have a plan in place for any positives or negatives?

This has the potential to be a huge political win for President Obama… or a major embarrassment….

“We are hoping and praying that they will not be able to deny what the Lord has ordained,” 

Is Burris trying to say that Rod Blagojevich is God, seeing Blagojevich is the person who appointed him to the open IL senate seat?

I have no desire to go into the details of this circus, you can read about it here, I just think that Burris could have chosen his words with more care.

I’m curious – how does a company, or a person, simply get away with saying “Bankruptcy is not an option”? 

For the last several weeks that is exactly what General Motors has been saying.  Apparently the automaker has had several board meetings, which included input from lawyers and financial consultants, and everyone agreed that nope, bankruptcy is not an option.  Sorry, it just won’t work. 

 What?  Really?

The reality is that it is an option, a viable option; it’s simply that the automaker does not want to go into bankruptcy.  I’m guessing the company continues to say this is tied directly to the belief that if GM does slide into bankruptcy that will be the end of the storied American automaker.  What GM is really saying is “Having our company go out of business is not an option”

As of this writing, 9:30 PM on 12/11/08, the Senate was still attempting to hammer out a plan to provide a “loan” to the auto industry.  As of 10:20 PM on 12/11 the bailout died in the Senate.  Yes, I believe, be it today or tomorrow or the 20^th of January 2009, a plan will be passed. 

In the end, I still believe GM will end up going under at some point.  It may not be tomorrow, but the company is not sustainable with the way it is currently managed. So, guess what, bankruptcy is an option. Simply saying something “is not an option” does not make it so.  

Dear god, please don’t let it start like this.  That was my initial reaction when I found out the news about Blagojevich. 

Quick recap - Yesterday, Illinois Governor Rod Blagojevich was arrested by Federal Agents for:

Blagojevich put a ‘for sale’ sign on the naming of a United States senator; involved himself personally in pay-to-play schemes with the urgency of a salesman meeting his annual sales target; and corruptly used his office in an effort to trample editorial voices of criticism.”  U.S. Attorney Patrick Fitzgerald

 Almost immediately Obama came out and said the following:

“I had no contact with the governor or his office and so I was not aware of what was happening, ” Obama told reporters today in Chicago. “It’s a sad day for Illinois. Beyond that, I don’t think it’s appropriate to comment.”

U.S. Attorney Patrick Fitzgerald is not implying there is a connected between president elect Obama and Blagojevich. There is, however, a conflict between what Obama said yesterday about having no connection with Blagojevich and naming the next Senator.

Look at what David Axelrod, Obama political consultant, previously stated:

Axelrod also came out yesterday saying he previously misspoke and that Obama/Blagojevich had no discussion regarding the open Senate seat.

With all the other topics facing the nation, I hope the media does not make a scandal out of what appears to be nothing. More harm than good would come out of such a situation. If Obama did break the law the, yes, he needs to be held accountable but I would NOT want to see such a situation…

The question that continues to roll around my head is the one that no one seems to be addressing – where do we go from here?  

Go to the news website of your choice and do a little research.  See if you can find what the next steps are.  Will the bill be rewritten?  When does the house come back? What needs to change in order to pass the House?  If it passes the House how do we know the legislation will pass the Senate?  Where is the President?  Beyond him being “very disappointed” how is he working with the Congress move this forward.

Let’s forget the credit crisis and the impact the lack of liquidity will have for one second – what is killing the Market and economy now is uncertainty.  The longer direction is lacking, the longer the market is in the fog of uncertainty, major volatility can be expected which will only intensify the lack of credit available to the market.

Update

Bloomberg.com has the only “next step” I’ve been able to find.  The Senate will be back in on Thursday an may pass something and then send it back to the House.  

At this point even the politicians have no clue what is coming next and they admit it.