Bailout
Obama to Announce Financial System Overhaul
Published June 16, 2009 @ 09:00AM PT
Later this week, President Obama will lay out a comprehensive plan to overhaul our nation's financial system. Will it deliver the vast regulation and reform we need to control the excessive risk-taking of the last decade? Will it curb irresponsible, freewheeling lending? Or will it be anemic or a non-starter, like a few too many of his big plans?
Treasury Secretary and Guy-With-Too-Much-Power economic advisor Larry Summers give us a sneak peak of what to expect:
- To stabilize the whole "system," capital and liquidity requirements for individual banks will go up, interconnected banks will be under "consolidated supervision" by the Fed, a "council of regulators" will keep an eye on the system.
- Originators of securitizations will have to retain a financial stake, credit agencies will no longer be as influential, and asset-backed securities will come with stricter reporting requirements. Derivatives will be regulated by people who can actually "enforce" the rules.
- This one concerning predatory lending may be the most vague, or maybe just the most vague using the least fancy terms. Either way, it's worrisome for the majority of us: "the administration will offer a stronger framework for consumer and investor protection across the board."
- Wait, this one's real vague too. Either Geithner and Summers ran out of steam, WaPo edited this, or they're really just thinking out loud on these. Concerning all the bailouts by the Fed, this will cease, to be replaced by "a resolution mechanism that allows for the orderly resolution of any financial holding company whose failure might threaten the stability of the financial system. This authority will be available only in extraordinary circumstances, but it will help ensure that the government is no longer forced to choose between bailouts and financial collapse." Didn't Paulson get down on one knee last fall begging Congress to take "extraordinary" measures?
- "We will lead the effort to improve regulation and supervision around the world." Because our credibility is strong. Good plan!
/snark.
Seriously though, what do you expect and what do you hope to hear? Let's stay tuned, shall we?
(Obama and his Economic Team, Press Conference from the Obama-Biden Transition Project)
"We were poor and we're still poor"
Published June 14, 2009 @ 08:23AM PT
I have to wonder if the presence of Barbara Ehrenreich in the NYT talking about the working poor and the recession will finally get people to pay attention to this notoriously invisible population:
...the outlook is not so cozy when we look at the effects of the recession on a group generally omitted from all the vivid narratives of downward mobility — the already poor, the estimated 20 percent to 30 percent of the population who struggle to get by in the best of times. This demographic, the working poor, have already been living in an economic depression of their own. From their point of view “the economy,” as a shared condition, is a fiction.
And as racial justice advocate Gihan Perera points out, our stimulus policies are not exactly poised to change anything.
Being Broke
Published June 07, 2009 @ 09:05AM PT
And so, as I try to put the furniture back where it was, and wake up a couple of sleeping party guests, we can return this site to Leigh pretty much as we found it (along with a note promising to replace the broken lamp). Since Greg and Diane and I couldn't apparently solve the poverty problem in a week, there will still be plenty for Red to write about.
Just to get Leigh started, I'll hand it back to her with a pressing issue Diane touched on yesterday - the growing sense that our economic crisis has become a state-level problem, bankrupting state budgets, and causing them to cut services... often to the neediest populations, at just the worst moment.
Make The Connections...
Published June 02, 2009 @ 12:09PM PT
Part of the challenge of a blog like this - and of working for change - is that the problems we face can seem so immense. There's so many things to do, so much that needs... well, change... that one can get very caught up in looking at problems, and not thinking about solutions, or, indeed, doing anything at all.
Yet, we still need the "big picture" - realizing that problems are interconnected, and complex, helps to understand, fully, why solving things that seem simple may not be, ultimately. Knowing the big pictures, the connected problems should give us pause... it just shouldn't stop us completely.
So before talking, in future posts, about taking action, I thought it might be worthwhile to look at some of the big picture - issues we face where poverty issues play a part, but not the whole, of problems we have (here in America, which is my focus, and elsewhere). As always, I hope you'll join in with comments about issues you see, and how you deal with the complexities of the problems we face. And yes, these are issues I care about deeply; I know there's so much more out there.
Credit Card Legislation Passes in Senate
Published May 19, 2009 @ 01:26PM PT
The Senate voted overwhelmingly on Tuesday to put new restrictions on the credit card industry, passing a bill whose backers say will make card-issuers spell out their terms in fewer words, using plain English, and treat customers more fairly.
This follows a similar House bill. After the differences between the two are worked out, a final bill goes to Obama for signature.
Frankly, I'm surprised it passed so quickly. This must be the give-away legislation for voters so as to distract us from the on-going bank bailouts and inadequacies in the housing rescue bills and stimulus. Not to mention the potential taxpayer subsidy behind this as well.
First, Principles
Published May 16, 2009 @ 09:00AM PT
Of all the lessons from our economic downturn, the first, most basic one has not really changed: unless and until we do something to solve the home lending and foreclosure mess, we can’t really hope to climb out of the hole we’re in.
Everybody knows that… right?
Of course, there’s knowing and there’s doing… and unfortunately, while the knowing we have a problem part seems a given, the doing is not so clear.
Inequality Makes People Cruel
Published May 11, 2009 @ 12:02PM PT
Discuss.
Fellow blogger Alana (h/t) comes to that conclusion, with the aid of a Twitter survey (Twurvey?):
...that explains the people on the bottom end of the pyramid forced into cruel actions and cruel choices, and the people on the top end, so far from poverty that poor people and their problems no longer seem real to them. It’s easy to be cruel when you can’t see your victims. Or when you think their problems are inevitable and can’t be solved. Or when you think poor people make themselves poor or even aren’t quite human. Inequality creates the kind of distance that makes that happen.
Or when you're motivated by greed or entitlement.
What's missing here b/w these poles is the middle-class countries like ours possess; what is their role here? I'd venture ignorance or worse, indifference. To be blind to how our world works, or for failing to advocate for change, whether at a micro, personal level or at a collective macro level.
What do you think? It's an interesting discussion in light of recent global survey findings and the increased importance of the federal (central) government right now:
