Republicans fold

 Posted by at 19:11  Business, economy, Republicans
Apr 282010

The Republicans have finally recognized the futility of putting the interests of their billionaire buddies on Wall Street ahead of Main Street America…

GOP abandons blockade of banking regulation bill

Republicans abandoned their blockade against legislation to clamp tough new controls on Wall Street Wednesday, clearing a road to likely passage for the most sweeping rewrite of financial rules since the Great Depression.

Democrats and Republicans agree the Senate will ultimately pass landmark changes aimed at preventing a recurrence of the crisis that knocked the nation’s financial system to its knees in 2008, but the battle now begins over crucial details. The House has already passed its version.

Democrats said the Republicans had given in after three days of votes to block debate, realizing they were on the losing end of a battle for public opinion. GOP lawmakers said they would now switch to trying to change the bill on the Senate floor.

Sen. Sheldon Whitehouse, D-R.I., said, “There’s been immense pressure bottled up inside the Republican caucus through these last three votes. A lot of their members have been very deeply unhappy with the direction their leadership has been taking them. Better heads prevailed.”

Democrats had threatened to hold the Senate in session all night making their case that the Republicans were stalling legislation of importance to virtually every American. The Democrats also have been laying plans to make the legislation a major issue in midterm elections this summer and fall. The Republican retreat came one day after senior executives of Wall Street giant Goldman Sachs were denounced by lawmakers from both parties at a marathon Senate hearing.

It seems that all you have to do to pound some sense into their thick heads is threaten to keep them up all night.


Double Dips

 Posted by at 16:30  Business, Politics
Apr 062010

I don’t know about you, but I am more than just a little tired of big business in this country basing their profits on freebies from the government and then complaining and cutting their employees’ benefits when those freebies go away.

We Call That Double-Dipping

Republican critics are continuing to pummel health care reform. Their newest charge is that the elimination of one generous tax deduction for retiree benefits would take such a bite out of corporate profits that companies may have to cut back on hiring, drop that retiree benefit, and shift added costs onto the taxpayer.

What is really going on? It is true that, starting in 2013, the new law eliminates a corporate tax advantage on retiree drug benefits that amounts to double-dipping.

It is also true that accounting rules require that the present value of the entire additional tax that companies will have to pay over the next several decades be put on the books now. That led AT&T to declare a charge of about $1 billion in the first quarter of 2010 and Verizon to declare $970 million.

Those look like staggering amounts until one understands that they don’t require any immediate cash payments and that the added taxes will be paid out slowly — over perhaps 30, 40 or more years, depending on a company’s retiree plan…

The affected companies have already profited from an inequitable provision in the 2003 Medicare prescription drug law. At the time, many employers were already providing drug coverage for their retirees. And to keep them from dropping that coverage, the new law provided doubly sweet subsidies to corporations.

For every $100 the company spends on retiree drug benefits, Medicare sends it a subsidy payment of $28. On top of that, the companies got a rare double tax break. The $28 subsidy is tax-free, and the company was allowed to deduct the entire $100 as a business expense.

The new health care reform law has left the 28 percent subsidy intact and continued to exempt it from taxation. But companies will no longer be allowed to deduct the subsidy as if it were an expenditure of their own…

The unanswered question is whether — as the critics charge — the change will push a lot of employers into dropping their retiree drug plans. The remaining tax subsidy is substantial and many companies and their workers value the retiree drug benefit, so defections may be small. If some retirees do lose their company drug benefits, they can buy government-subsidized coverage in Medicare that may be just or almost as good and will be getting better as health care reform progresses. Willing employers could also help subsidize their retirees’ drug coverage in Medicare.

That’s the least they should do in return for the generous tax benefits they have been receiving.

Perhaps it is time for new management at some of these large American corporations — management that can make a profit without government giveaways and giant tax loopholes and still provide for the people upon whom their businesses rely.

(Note to AT&T: You are paying Randall Stephenson at least $20,000,000 per year. Perhaps it’s time to expect a little competence and leadership in exchange for all that money.)

Executive pay cuts

 Posted by at 21:32  Business, Politics
Oct 212009


U.S. to cut pay for bailed-out bosses

NEW YORK — The Obama administration plans to order companies that have received exceptionally large amounts of bailout money from the government to slash compensation for their highest-paid executives by about half on average, according to people familiar with the long-awaited decision.

The cuts will affect 25 of the most highly paid executives at each of five major financial companies and two automakers, according to the sources, who spoke on the condition of anonymity because the plan has not been made public. Cash salaries will be cut by about 90 percent compared with last year, they said.

The administration will also curtail many corporate perks, including the use of corporate jets for personal travel, chauffeured drivers and country club fee reimbursement, people familiar with the matter have said. Individual perks worth more than $25,000 have received particular scrutiny.

The compensation of these people should not even be an issue. They should be looking for new jobs.

Many on the right are screaming that these pay cuts are wrong because these highly paid executives will now seek “greener fields,” leaving these companies without their leadership. That’s actually laughable. If there were any greener fields available to these idiots, they would already be grazing in them.

P.S. Does this mean I have to trade my Bentley in for a Mercedes?

2010 Bentley Continental GT
2010 Bentley Continental GT


Jun 012009

This will be my first time participating in ‘Music Monday.’ I thought what better occasion stick my toe in the water than the demise of General Motors as we have known it all these years. So, in loving memory of the GM we all grew up with, Mr. Jerry Lee Lewis…

UPDATE: Here’s President Obama on “The Beginning of a New GM”:

The transcript of the President’s remarks is available following the break.

Continue reading »

Credit and guns

 Posted by at 16:46  Business, economy, Politics
May 202009

A piece of legislation that never in a million years would have seen the light of day under a Republican administration is on its way to the President’s desk to be signed into law…

House Passes Credit Card Bill, Sending It to President


The House today gave final approval to a bill that would prohibit credit card companies from arbritarily raising interest rates on existing balances and charging certain fees.

With a 361-64 vote, the House ensured that President Obama will be able to sign the bill into law by Memorial Day, as he requested.

The House had approved a more diluted credit card reform bill last month but chose to send the stronger Senate version to the president instead. The Senate overwhelmingly passed its bill, written by Banking Committee Chairman Christoper J. Dodd (D-Conn.), yesterday…

The landmark credit card legislation will force the $960 billion card industry to reinvent itself and consumers to rethink the way they use plastic.

The bill will prohibit card companies from raising interest rates on existing balances unless the borrower is at least 60 days late. If the cardholder pays on time for the following six months, the company would have to restore the original rate. On cards with more than one interest rate, issuers will have to apply payments first to the debts with the highest rates, which would help borrowers pay off their cards more quickly.

There is a dark side to every cloud, however. I don’t know what guns have to do with credit cards, but Republican Senator Tom Coburn of Oklahoma did the bidding of his NRA masters and attached an amendment to the bill that will allow people to bring loaded guns into national parks and wildlife refuges. The amendment was approved in the House by a vote of 279-147. President Obama has said he will sign the bill even with the Coburn amendment attached.

So much for our national parks and wildlife refuges. Can somebody explain to me why people need to carry loaded guns in national parks and wildlife refuges? Perhaps to protect themselves from all those terrorists President Obama is getting ready to release from Gitmo? Or maybe it’s the ants…



May 122009

Someone sent me a message via the contact form on this blog a few moments ago asking why I haven’t had anything to say about the whole Carrie Prejean Miss California fiasco. Well…

I guess I just haven’t found it worthy of comment. I think all the time and effort being spent on it by the news media (and a lot of bloggers) is time and effort wasted. The whole thing is ridiculous. (Except maybe for that part about how you can completely violate the terms of your contract of employment and still keep your job, for which we can thank The Donald.) I’ve said all I want to say on the matter. I’ll let Keith Olbermann summarize…

WTF? Could it be that we have stumbled upon the future Sarah Palin? 😉

Big Money Medicine

 Posted by at 17:11  Business, economy, Politics
May 112009

President Obama met this morning with representatives from Big Money Medicine (insurance companies, drug companies, hospitals, doctors, etc.) who are promising to cut two trillion dollars out of the increases in the costs for their services over the next decade. Perhaps someone can explain that to me. Health care costs in this country are already through the roof. These people are not offering to do anything to make it more affordable or more accessible for more people now. Instead, they are saying they are going to cut a couple trillion dollars out of their increases over ten years.

This is really nothing more than a grand gesture on the part of Big Money Medicine, folks. They have seen the writing on the wall. They know that President Obama has promised long overdue health care reform in the United States and they know it is going to happen. This is their way of making it appear that they are on board. The President did the right thing by meeting with them this morning. It gave him the opportunity to begin shifting the spotlight onto one of his key initiatives and, at the same time, made it impossible for Big Money Medicine to begin fighting him down the road without making themselves out to be complete fools and hypocrites.

Here is video of the President’s remarks following this morning’s meeting:

A key excerpt, and one which I am sure raised a few eyebrows in the group representing Big Money Medicine:

We, as a nation, are now spending a far larger share of our national wealth on health care than we were a generation ago. At the rate we’re going, we are expected to spend one fifth of our economy on health care within a decade. And yet we’re getting less for our money. In fact, we’re spending more on health care than any other nation on Earth, even though millions of Americans don’t have the affordable, quality care they deserve, and nearly 46 million Americans don’t have any health insurance at all.

This problem didn’t just appear overnight. For decades, Washington has debated what to do about this. For decades, we’ve talked about reducing costs, improving care, and providing coverage to uninsured Americans. But all too often, efforts at reform have fallen victim to special interest lobbying aimed at keeping things the way they are; to political point-scoring that sees health care not as a moral issue or an economic issue, but as a wedge issue; and to a failure on all sides to come together on behalf of the American people.

The complete text of President Obama’s remarks may be read after the break.

Continue reading »

Toyota posts loss

 Posted by at 17:47  Business, Politics
May 092009

I’m sure the Republicans will find some way to blame this on the United Auto Workers…

Toyota suffers stunning annual net loss — its first since 1950

Stung by declining auto sales, Toyota Motor Corp. said it lost $7.7 billion in the fourth quarter — leading to its first annual loss since 1950. And the world’s largest automaker said next year may be worse.

Chief Executive Katsuaki Watanabe said Friday that Toyota, battered by a strong yen and slumping demand, lost $4.4 billion in its 2009 fiscal year, compared with a $17.7-billion profit a year earlier.

For its current fiscal year, Toyota is predicting an even greater loss of $5.5 billion.

Toyota shares fell $1.07, or 1.3%, to $79.17 in trading Friday.

In addition to the dismal forecast, which was far more extreme than analysts had expected, the Japanese behemoth said it was expecting to sell at least 1 million fewer vehicles for the fiscal year ending in March 2010 as it tries to cut costs by slowing production.