1. Welcome! Please take a few seconds to create your free account to post threads, make some friends, remove a few ads while surfing and much more. ClutchFans has been bringing fans together to talk Houston Sports since 1996. Join us!

Newt: Slow down

Discussion in 'BBS Hangout: Debate & Discussion' started by basso, Sep 22, 2008.

  1. basso

    basso Member
    Supporting Member

    Joined:
    May 20, 2002
    Messages:
    30,623
    Likes Received:
    7,123
    i wasn't such a fan back in his hay day, but i find myself liking him more and more.

    i hope he finds a spot in a Palin-McCain administration...

    [rquoter]
    Before D.C. Gets Our Money, It Owes Us Some Answers [Newt Gingrich]

    Watching Washington rush to throw taxpayer money at Wall Street has been sobering and a little frightening.

    We are being told Treasury Secretary Henry Paulson has a plan which will shift $700 billion in obligations from private companies to the taxpayer.

    We are being warned that this $700 billion bailout is the only answer to a crisis.

    We are being reassured that we can trust Secretary Paulson "because he knows what he is doing".

    Congress had better ask a lot of questions before it shifts this much burden to the taxpayer and shifts this much power to a Washington bureaucracy.

    Imagine that the political balance of power in Washington were different.

    If this were a Democratic administration the Republicans in the House and Senate would be demanding answers and would be organizing for a “no” vote.

    If a Democratic administration were proposing this plan, Republicans would realize that having Connecticut Democratic senator Chris Dodd (the largest recipient of political funds from Fannie Mae and Freddie Mac) as chairman of the Banking Committee guarantees that the Obama-Reid-Pelosi-Paulson plan that will emerge will be much worse as legislation than it started out as the Paulson proposal.

    If this were a Democratic proposal, Republicans would remember that the Democrats wrote a grotesque housing bailout bill this summer that paid off their left-wing allies with taxpayer money, which despite its price tag of $300 billion has apparently failed as of last week, and could expect even more damage in this bill.

    But because this gigantic power shift to Washington and this avalanche of taxpayer money is being proposed by a Republican administration, the normal conservative voices have been silent or confused.

    It’s time to end the silence and clear up the confusion.

    Congress has an obligation to protect the taxpayer.

    Congress has an obligation to limit the executive branch to the rule of law.

    Congress has an obligation to perform oversight.

    Congress was designed by the Founding Fathers to move slowly, precisely to avoid the sudden panic of a one-week solution that becomes a 20-year mess.

    There are four major questions that have to be answered before Congress adopts a new $700 billion burden for the American taxpayer. On each of these questions, I believe Congress’s answer will be “no” if it slows down long enough to examine the facts.

    Question One: Is the current financial crisis the only crisis affecting the economy?

    Answer: There are actually multiple crises hurting the economy.

    There is an immediate crisis of liquidity on Wall Street.

    There is a longer time crisis of a bad energy policy transferring $700 billion a year to foreign countries (so foreign sovereign capital funds are now using our energy payments to buy our companies).

    There is a longer term crisis of Sarbanes-Oxley (the last "crisis"-inspired congressional disaster) crippling entrepreneurial start ups, driving public companies private, driving smart business people off public boards, and driving offerings from New York to London.

    There is a long term crisis of a high corporate tax rate driving business out of the United States.

    No solution to the immediate liquidity crisis should further cripple the American economy for the long run. Instead, the liquidity solution should be designed to strengthen the economy for competition in the world market.


    Question Two: Is a big bureaucracy solution the only answer?

    Answer: There is a non-bureaucratic solution that would stop the liquidity crisis almost overnight and do it using private capital rather than taxpayer money.

    Four reform steps will have capital flowing with no government bureaucracy and no taxpayer burden.

    First, suspend the mark-to-market rule which is insanely driving companies to unnecessary bankruptcy. If short selling can be suspended on 799 stocks (an arbitrary number and a warning of the rule by bureaucrats which is coming under the Paulson plan), the mark-to-market rule can be suspended for six months and then replaced with a more accurate three year rolling average mark-to-market.

    Second, repeal Sarbanes-Oxley. It failed with Freddy Mac. It failed with Fannie Mae. It failed with Bear Stearns. It failed with Lehman Brothers. It failed with AIG. It is crippling our entrepreneurial economy. I spent three days this week in Silicon Valley. Everyone agreed Sarbanes-Oxley was crippling the economy. One firm told me they would bring more than 20 companies public in the next year if the law was repealed. Its Sarbanes-Oxley’s $3 million per startup annual accounting fee that is keeping these companies private.

    Third, match our competitors in China and Singapore by going to a zero capital gains tax. Private capital will flood into Wall Street with zero capital gains and it will come at no cost to the taxpayer. Even if you believe in a static analytical model in which lower capital gains taxes mean lower revenues for the Treasury, a zero capital gains tax costs much less than the Paulson plan. And if you believe in a historic model (as I do), a zero capital gains tax would lead to a dramatic increase in federal revenue through a larger, more competitive and more prosperous economy.

    Fourth, immediately pass an “all of the above” energy plan designed to bring home $500 billion of the $700 billion a year we are sending overseas. With that much energy income the American economy would boom and government revenues would grow.


    Question Three: Will the Paulson plan be implemented with transparency and oversight?

    Answer: Implementation of the Paulson plan is going to be a mess. It is going to be a great opportunity for lobbyists and lawyers to make a lot of money. Who are the financial magicians Paulson is going to hire? Are they from Wall Street? If they’re from Wall Street, aren't they the very people we are saving? And doesn’t that mean that we’re using the taxpayers’ money to hire people to save their friends with even more taxpayer money? Won't this inevitably lead to crony capitalism? Who is going to do oversight? How much transparency is there going to be? We still haven't seen the report which led to bailing out Fannie Mae and Freddie Mac. It is "secret". Is our $700 billion going to be spent in "secret" too? In practical terms, will a bill be written in public so people can analyze it? Or will it be written in a closed room by the very people who have been collecting money from the institutions they are now going to use our money to bail out?

    Question Four: In two months we will have an election and then there will be a new administration. Is this plan something we want to trust to a post-Paulson Treasury?

    Answer: We don’t know who will inherit this plan.

    The balance of power on election day will shift to either McCain or Obama. Who will they pick for Treasury Secretary? What will their allies want done? We are about to give the next administration a level of detailed control over big companies on a scale even FDR did not exercise during the Great Depression. Is this really wise?

    For these reasons I hope Congress will slow down and have an open debate.

    And in the course of that debate, I hope someone will introduce an economic recovery act that makes America a better place to grow jobs. I hope the details will be made public before the vote.

    For more details on my action plan for getting the American economy back on track and building long-term economic prosperity, you can read this message recorded yesterday to American Solutions members.

    This is a very important week for the integrity of the Congress.

    This is a very important week for the future of America.

    If Washington wants our money, then it owes us some answers.[/rquoter]
     
  2. mtbrays

    mtbrays Member
    Supporting Member

    Joined:
    Jul 4, 2007
    Messages:
    7,936
    Likes Received:
    6,839
    I see what you did there...
     
  3. DaDakota

    DaDakota If you want to know, just ask!
    Supporting Member

    Joined:
    Mar 14, 1999
    Messages:
    124,958
    Likes Received:
    33,974
    A FANTASTIC article by Newt.....
    DD
     
    #3 DaDakota, Sep 22, 2008
    Last edited: Sep 22, 2008
  4. Master Baiter

    Master Baiter Member

    Joined:
    Jul 6, 2001
    Messages:
    9,608
    Likes Received:
    1,375
    Wow, a basso article that I actually agree with for the most part. I guess a blind hog does find a acorn every once in a while.
     
  5. DaDakota

    DaDakota If you want to know, just ask!
    Supporting Member

    Joined:
    Mar 14, 1999
    Messages:
    124,958
    Likes Received:
    33,974

    Fixed it for ya.

    ;)

    DD
     
  6. kpsta

    kpsta Member

    Joined:
    Sep 2, 2001
    Messages:
    2,654
    Likes Received:
    166
    I thought it was a blind pig finding the lipstick...
     
  7. thelasik

    thelasik Contributing Member

    Joined:
    May 9, 2005
    Messages:
    3,347
    Likes Received:
    72
    ahaha :D
     
  8. DonnyMost

    DonnyMost Member
    Supporting Member

    Joined:
    May 18, 2003
    Messages:
    47,827
    Likes Received:
    17,695
    Basso, since I rail on you for posting so much junk I really want to make sure you understand how much I appreciate a substantive post.

    *PROPS*
     
  9. A_3PO

    A_3PO Member

    Joined:
    Apr 29, 2006
    Messages:
    42,974
    Likes Received:
    6,474
    Newt is a great pontificator, theoretician and idea guy. Just don't give him any real power other than words. If he were one of the power brokers in Congress or at Treasury putting this package together, he wouldn't be any more trustworthy than anyone else.
     
  10. pgabriel

    pgabriel Educated Negro

    Joined:
    Dec 6, 2002
    Messages:
    42,898
    Likes Received:
    3,063
    well I hate to break up the love fest but this is just an op ed using the current crisis to push through the same old ideas. iow, most this has nothing to do with the crisis
     
  11. DaDakota

    DaDakota If you want to know, just ask!
    Supporting Member

    Joined:
    Mar 14, 1999
    Messages:
    124,958
    Likes Received:
    33,974
    Sarbanes-Oxley. has been horrible.
    DD
     
    #11 DaDakota, Sep 22, 2008
    Last edited: Sep 22, 2008
  12. JuanValdez

    JuanValdez Member

    Joined:
    Feb 14, 1999
    Messages:
    34,371
    Likes Received:
    13,939
    I started liking Newt after he left office. And, I appreciate his dissent here, where it seems the government is being remarkably swift to adopt a very radical plan in a very precarious time.

    But, I don't really agree with him. His Question 1 ignores or misjudges the intensity of crises. I disagree about SOX, which I want to keep (though I'm open to revisions); but even if I didn't like it, I'd have a hard time agreeing the "crisis" created by SOX is comparable to the credit crisis. If it is, everyone has overblown the current problem and we shouldn't be doing anything radical or quick.

    He doesn't connect the dots on why he thinks his 4-step private capital route back to liquidity would work. He's a smart guy so maybe it would, but I don't see why it provides the quality of mechanisms we need.

    His question about transparency is a good one. If we're ever going to get it, it'll only be if Congress demands it at the outset (and maybe not even then). As for Paulson's successor, that question just won't have an answer yet. I don't see that as a handicap to the plan, however. I'm sure Obama or McCain can find someone as capable as Paulson. Cemetaries are full of indispensable people. Or, if he's that great, keep him around; we don't have to bury him in the pyramid with Bush.
     
  13. Rocket River

    Rocket River Member

    Joined:
    Oct 5, 1999
    Messages:
    62,181
    Likes Received:
    29,521
    torture
    patriot act absorbing liberties
    lies to get america into a war

    Seems like Newt is ready to impeach the current Admin . . .like alot of folx

    Rocket River
     
  14. F.D. Khan

    F.D. Khan Member

    Joined:
    Feb 14, 2000
    Messages:
    2,456
    Likes Received:
    11

    This is a common mistake that people are discussing. This is not 1998 in which it was a crisis of liquidity, its a crisis of solvency.

    There is a big difference.
     
  15. basso

    basso Member
    Supporting Member

    Joined:
    May 20, 2002
    Messages:
    30,623
    Likes Received:
    7,123
    you're ignoring congress' role, and hence the people's role, in each of those (not that i accept the implied premise in any of them). if you're pissed, you should be pissed at us, all of us, and yourself. which is one reason why i support palin-mccain this year. not that they're an ideal ticket, but obama (who is his running mate again?) is far more in bed with the existing power structure in DC than McCain. once you remove the shiney veneer of his gleaming rhetoric, there remains an olde tyme chicago machine politician, beholden to special interests, and with a history of taking cash from some of the worst instigators of this mess. that's not change i can believe in- it's more of the same, and not who i want running this country.

    VDH also has a some salient observations as we figure out where to go next.

    [rquoter]We Have Met the Enemy and He Is...? [Victor Davis Hanson]
    In the sudden rush to blame the crooks in DC and on Wall Street, we should first take a long look in the mirror. For two decades, we — as in we Americans — expected to buy homes, flip them, and walk away with thousands — without much thought about what might happen to the johnny-come-lately at the bottom of the pyramid when the game was finally up and housing prices cooled or crashed. Walking away from a mortgage on a house with negative equity was "smart;" putting someone in one who had no ability to come up with a down payment, monthly payments, taxes, and maintenance was "fair"; borrowing unduly against equity for cash expenditures was "understandable."

    We deified the masters of hedge funds, derivatives, and subprime mortgages, forgetting that passé oil production, mining, farming, manufacturing, engineering and construction were the real sources of our material wealth.

    We assumed mega-returns on our portfolios, without a thought what Wall Street did to get them, or the effect on others who needed to borrow at such high interest to run their businessess.

    Ours became a culture that wanted larger cars but less drilling to fuel them, more stuff and more credit from — and more anger at — the Chinese; less taxes but even more government hand-outs; ever more electricity, but fewer icky coal and nuclear plants — and always more health-care, education-care, prescription drug-care, housing-care, and always less care how to pay for it.

    So by all means let us prosecute the lawbreakers, finger-point at the enablers, lecture the stupid, but at least spare us the sanctimonious "they" did this to poor "us." If there were not a Senate Banking Chairman like Chris Dodd without shame cozing up to the creeps at Freddie Mac and Fannie Mae, or a Richard Fuld playing casino roulette with someone else's money, we would have had to invent them.

    We should argue over the course of Paulson's unpleasant chemotherapy to deal with these symptoms of a metastasizing disease, but let us at least consider what were the catalysts for that deeper cancer.[/rquoter]
     
  16. rimrocker

    rimrocker Member

    Joined:
    Dec 22, 1999
    Messages:
    22,492
    Likes Received:
    8,584
    Greenwald writes well and his topic today fits with this thread...

    http://www.salon.com/opinion/greenwald/

    Here's a taste...
    Read the rest.
     
  17. basso

    basso Member
    Supporting Member

    Joined:
    May 20, 2002
    Messages:
    30,623
    Likes Received:
    7,123
    can you use the [rquoter] tag, or indent, or increase font size, or something if you want use to read these? the text is too small for these old eyes...
     
  18. bejezuz

    bejezuz Member

    Joined:
    Jun 26, 2002
    Messages:
    2,772
    Likes Received:
    69
    The purpose of Sarbanes-Oxley was to prevent accounting fraud. The current crisis has nothing to do with fraud. Everything was done out in the open, it was just done poorly.
     
  19. Major

    Major Member

    Joined:
    Jun 28, 1999
    Messages:
    41,446
    Likes Received:
    15,886
    I think the main concerns with Sarbox are more with its burdensomeness and costs. I think it does it's job pretty effectively - lots of people just think it's way too much. I don't know enough about the details to have a real stance.

    On the original topic, I don't agree with Newt here, but I think he's a great voice to have in the national debate. Ever since he left office, he's really come out as a very smart, rational conservative - the kind we need more of in government (and on this board!).
     
  20. Major

    Major Member

    Joined:
    Jun 28, 1999
    Messages:
    41,446
    Likes Received:
    15,886
    This is an odd claim to make when you look at the composition of money sources, advisors and campaign staff of each campaign (the people that will likely play key roles in an administration for each of the candidates).

    McCain won the nomination essentially by becoming the establishment GOP candidate - he essentially tied himself to all the power-players in the party and switched his views to fit those power-players.
     

Share This Page

  • About ClutchFans

    Since 1996, ClutchFans has been loud and proud covering the Houston Rockets, helping set an industry standard for team fan sites. The forums have been a home for Houston sports fans as well as basketball fanatics around the globe.

  • Support ClutchFans!

    If you find that ClutchFans is a valuable resource for you, please consider becoming a Supporting Member. Supporting Members can upload photos and attachments directly to their posts, customize their user title and more. Gold Supporters see zero ads!


    Upgrade Now