Posted on 02/09/2011 5:04:44 AM PST by RobertClark
We all know by now that Meredith is a witch: an unpatriotic, racist witch, who eats kittens for breakfast, who deserves to be grilled by Joe McCarthy's exhumated corpse for telling communist truths, pardon, lies (just a Freudian slip dear Department of Central Planning and Internet supervision), and who will soon be accused of having unprotected (yet arguably consensual) sex with a Swedish man. But just in case she is on to something, here comes the president's plan to bail out the (otherwise perfectly solvent and all, we promise) states. The NYT reports that "President Obama is proposing to ride to the rescue of states that have borrowed billions of dollars from the federal government to continue paying unemployment benefits during the economic downturn. His plan would give the states a two-year breather before automatic tax increases would hit employers, and before states would have to start paying interest on the loans." But where are the details you may ask? Patience grasshopper: they will be included in the latest budget proposal which has been delayed for nearly half a year now as the printer ran out of zeroes. "The proposal, which administration officials said would be included in the 2012 budget that the president is scheduled to unveil next week, was greeted coolly by Republicans on Capitol Hill, who warned that the plan would ultimately force many states to raise their unemployment taxes in the years to come." Ah yes, the Republicans - those paragons of sound financial judgment and sounder virtue. After all who can forget whole "Tea Party thing" which did so much to prevent the incurrence of a few hundred billion in additional debt over the next decade to pay for the latest Russell 2000 at 36,000 hairbrained ponzi scheme concocted by Rudolph von Bernankestein.
More from the NYT on why QE3.1 - the Muni Edition (not to be confused with QE3.7 the MBS edition, or the QE3.495 the ICE gold margin requirement edition, and most certainly not with QE3.495,440,559 the "Kill the David Einhorn shorts" edition) is just around the corner:
Administration officials will make the case that the plan helps the economy and states in the short run, while bringing overdue changes to the unemployment insurance system in the long run. And Republican lawmakers could find themselves under pressure from Republican governors, whose states owe the federal government billions of dollars.
The administration is also betting that employers will back the proposal, especially in states where their taxes would otherwise go up. Michigan, for instance, owes the federal government $3.7 billion it borrowed to pay unemployment benefits. Under current law the state would be forced to pay $117 million in interest to the federal government this fall, and the federal tax on employers would automatically step up each year to repay the debt.
The state’s newly elected Republican governor, Rick Snyder, has been lobbying for relief; his press secretary, Sara Wurfel, said that while they would need to see the details of the plan, they would “very likely welcome the much-needed relief.”
Robert Gibbs, the White House press secretary, said, “We are giving help to some states who have had to borrow and not been able yet to pay back.”
The states are in a tough spot. Many entered the recession with too little money in their unemployment trust funds, and they quickly ran through what little they had as unemployment rose and remained stubbornly high month after month.
So, uh, can we all drop the pretense and agree that while certainly scaring the children (who will all need PhDs in number theory in a few years just to count to the debt target, pardon, limit) and the idiots, Meredith has been pretty much spot on?
In fact, we can even forgive her for telling Congress to [back] off with their witch hunts:
Citing scheduling conflicts, Ms. Whitney has declined an invitation to appear before the panel of the House Oversight and Government Reform. But the subcommittee’s chairman, Representative Patrick T. McHenry, Republican of North Carolina, said that would not dissuade him from investigating her record.
“This isn’t a gotcha thing, but she’s going to be part of the hearing, whether or not she participates,” he said. “If she doesn’t want to come forward in a venue like this, that makes a statement.”
And some more details on how Obama will arrive in one of Blackhawk Ben's stealth Commanche gunships:
In his budget, officials said, Mr. Obama will call for deferring interest payments on the debt and postponing the automatic tax increases. Then, in 2014, to bring that money back into federal coffers, the administration proposes to raise the minimum level on which employers pay taxes.
Current law requires states to collect unemployment taxes on at least the first $7,000 of income; that minimum has not been raised in decades.
The president’s proposal would raise that minimum taxable wage base to $15,000. The rate of the federal portion of the unemployment taxes would then be lowered, so the proposal would not raise federal taxes on states that do not owe the federal government money. But it would speed the rate at which states that do owe money repay the federal government, and allow states to collect more unemployment taxes to rebuild their trust funds if they do not lower their tax rates.
It was that prospect — that the higher wage base would lead to higher taxes for states after 2014 — that drew rebukes from Republicans in Congress.
Don't worry children. It is for your own good. Plus if this plan falls through, the world will end. And yes, Meredith is certainly a witch and should be burned at the stake. Surely she will be able to fly away to safety due to the null hypothesis of her witchiness, and if she actually does burn: well, mistakes were made...
I guess I never really realized that now (well not now...technically soon...but not yet....maybe) our Federal Gov't is in the usury business bleeding our states. The Federal Gov't would then turn around and pay the banksters off for its loans. The situation the banks created through capturing federal employees to open their playgrounds, and the havoc it ultimately wrecks(ed), then turns what Hamilton did on his head. Instead of federal gov't clearing the way for states to survive by taking buzz cut loans onto the federal books, instead they would be on the hook so the federal gov't would survive. (who then in turn is on the hook so the banksters survive). Instead of the federal gov't as a force for enabling the American spirit, it would instead crush it. Again, for the banks. I'm picturing Spaceballs and the giant Vacuum.
Of course that's only if the federal gov't throws the states to wolves. They haven't yet, but it's all set up to happen at some point....just maybe not now.
If such a proposal is in the Obama budget that goes to Congress, it should be voted down. No bailouts to profligate states that refuse to get their state budgets under control by making the hard tough decisions. Any vote for such a proposal should be flagged by the voters in the next election and the Congressman who voted in favor of it should and must be voted out of office. Period. End of story.
As if their federal taxes won't go up? How about the employers in fiscally prudent states? Will they like seeing their federal taxes go up to bail out the spend thrifts in profligate States?
Whatever happened to exhumed?
When is Gibbs leaving anyway
So the states are forced to be bled white by the oppressors in D.C. and they have no say in the matter. They can’t leave this abusive marriage, either. So much for that “freedom” thing that the Founders thought they were instituting.
I don’t agree.
The Federal Government threw the States to the wolves when they extended unemployment. They threw them to the Wolves when the passed Medicare.
The States get screwed, they screw the Counties, and the Counties screw the residents.
The Counties go broke and they cannot pay their Bonds.
This lady see’s it coming, say’s it out in public and the Congress wants to hang her.
You have to search “Meredith Whitney” to understand what this is about
You have to search “Meredith Whitney” to understand what this is about
Yes, I guess a bit of background on Meredith would put this into perspective for those unfamiliar with her.
Meredith Ann Whitney (born November 20, 1969) is a banking analyst. She produces company-specific equity research on financial institutions and analyzes the sector’s operating environment.
Whitney wrote a particularly pessimistic, but accurate, report on Citigroup, on Oct. 31, 2007, which got her attention from many Wall Street analysts and the news media. She has since followed this report with similar reports and predictions, which have tended to leave the companies involved with lower stock prices as the market has taken her opinion seriously. One of her claims is that goodwill is built into a lot of companies’ share prices, and that as the market moves into dark times, this goodwill will dissipate.
More recently, Ms. Whitney has stated there will be between 50 and 100 counties, cities and towns in the U.S. that have “significant” municipal bond defaults in 2011 that total “hundreds of billions” of dollars in losses. This prediction was given during her appearance on the December 19, 2010 broadcast of the CBS program “60 Minutes.” Since the record amount of money lost in one year through municipal bond defaults is $8.2 billion, Ms. Whitney’s comments about hundreds of billions in losses drew a great deal of attention with much of it critical.
Thanks for posting. HOORAY to Tyler Durden and the great posters at zerohedge! The laboratories of democracy have become the stomping grounds for socialists...overlorded by a federal leviathan.
The politicians are too stupid to realize that there is a perfectly LEGAL way to avoid the taxes that fund unemployment compensation. It is to AVOID ADDING EMPLOYEES and to, if possible, AVOID having ANY employees at all.
Only by staying small, can a business truly have a measure of control over its own destiny.
In my own little business, for every reason I actually have to hire, there are two dozen GOVERNMENTAL, both state and federal, reasons NOT to hire.
I work 6 days a week, in a futile attempt to keep up, but will NOT put a target on my forehead. I will not become an “evil employer, taking advantage of the poor worker”. I will remain pure and noble, and small.
trying to soften us up for the BIG bailout that is coming down the pike
“This isn’t a gotcha thing, but she’s going to be part of the hearing, whether or not she participates,” he said. “If she doesn’t want to come forward in a venue like this, that makes a statement.”
Which means,yes,it is a gotcha thing. Doesn’t the ruling class despise when people don’t do their bidding?
I posted this previously, but it bears repeating here:
Mark Steyn, h/t to the author of a letter to the editor of the Wall Street Journal, had an interesting idea on this subject:
Allow states to declare bankruptcy, but one of the conditions is that the states then revert to territory (essentially receivership) status. Since the state would have demonstrated clearly that it is not capable of grown-up government, i.e. statehood, it has to let the grown-ups take charge and fix things.
Bankruptcy is supposed to have serious consequences, isn’t it? And chief among those is a restricted opportunity to get into more financial trouble.
No longer having state status, the bankrupt states also would at lesat temporarily lose their statehood rights to full representation in Congress. This would be part of the appropriate price for having squandered their chance at self-government and then, essentially, moving back in with the parents to sleep on the couch like losers until the grown-ups got their, the wayward child’s, affairs in order.
Steyn said he could think of one example in history where just such a process had occurred. IIRC, it was Newfoundland. Newfoundland had at one time been a sovereign nation (again, IIRC), but had to essentially declare bankruptcy—i.e., it did not effectively exercise self-government. So it then reverted to the British crown as a colony and, today, is a province of Canada.
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