Category: Government Failure

How Much Radiation Do Cell Phones Put Out?

On By southwerkIn Government Failure

How Much Radiation Do Cell Phones Put Out?

You carry one with you all the time. You may have more than one. Your cell phone is indispensable. It keeps you in contact. It is the center of your social life.

And it could be dangerous. Cell phones put out radiation. If you hear a computer, a radio, or a television set make strange noises, that’s some of the power the cell phone is throwing out.
How much radiation? Well, sometimes cell phone companies tell you. It can be on some inconspicuous place on the box or in the manual.

That’s really not fair. We have a right to know what we’re being exposed to.

One California legislator is trying to change that. Mark Leno has introduced a bill that requires disclosure of the radiation level. I like the idea. Other states, federal regulatory agencies and our fairly useless Congress ought to be protecting us.

Can The Free Market Help With Foreclosures?

On By southwerkIn Government Failure2 Comments

Can The Free Market Help With Foreclosures?

Yes, it can. Ira Hecht proposes the creation of an online market for troubled mortgages to be called: Mortgage Crisis Solution Program. The program would allow those with troubled mortgages to enter their data onto the database, (with privacy protections of course), and lenders would be able to find troubled mortgages worthy of re-financing. Obviously, this would not solve the mortgage crisis. But it would allow those who have short term difficulties to negotiate to keep their homes. Many people with good credit and properly valued homes deserve an opportunity to refinance.

This is an idea that should be developed. In this country much of the devotion to the free market is the most shallow of lip service. This would be government service to put lenders and borrowers together. If it’s socialism to put these people together, we need more of it. We should be encouraging this type of exchange, allowing individuals to profit while saving people’s homes.

Andrew Caplin has been writing about problems in the mortgage market for years. He is an economist and important author in the field. He thinks this is a good idea.

Let’s let the free market help this country in its time of need.

James Pilant

Small Business Needs A Consumer Protection Agency

On By southwerkIn Government Failure

Small Business Needs A Consumer Protection Agency

!!@@#dddddd444plate21-thConsumers continually suffer under the depredations of banks and credit card companies. But they are not the only sufferers. Margot Dorfman, President of the Women’s Chamber of Commerce, says that banks have cut lending to small business by 14 billion over the last year.

Small business often relies on credit cards, home equity loans and personal loans to finance their businesses. They are just as much as the mercy of the financial institutions as any individual.

Listen to what Ms. Dorfman has to say:

The Consumer Protection Agency

On By southwerkIn Government Failure

The Consumer Protection Agency

Currently in congress there is a bill passed by the House and now before the Senate that would create a U.S. Consumer Financial Protection Agency. The Senate at the behest of the financial institutions who have looted our treasury and destroyed the jobs and futures of millions of Americans is considering not having such an agency.

You see, there are wolves in the forest and the rabbits sometimes escape. Fortunately for the wolves they have powerful friends who continually corral and group the rabbits to make the hunting easier. For the rabbits to have a friend in the government would upset the rules of nature.

Let’s hear about the financial institutions from Elizabeth Warren, a defender of the rabbits.

I’m one of the rabbits and I resent that my Senators are unable to defend my interests.

James Pilant

Ethics and the Bank Bailout

On By southwerkIn Government Failure

Ethics and the Bank Bailout

President Barack Obama said Thursday he wants to tax banks to recoup the public bailout of foundering firms at the height of the financial crisis. “We want our money back,” he said.

Is it moral to tax banks to repay the public funds given them?

Is this a hard question?

If you run a restaurant, a filling station; if you sell insurance, automobiles, real estate; if you own a garage, a body shop or rent movies; will the government come and give you money to save your business in this time of troubles?

If you make particularly stupid and greedy decisions that result in your firm’s danger of failure, should this increase the probability of government help?

There is a Bible verse that may have relevance here. Psalm 37:21 The wicked borroweth, and payeth not again: but the righteous sheweth mercy, and giveth.

Well, the righteous have giveth and some may consider it just for the banks to pay back what they have received.

James Pethokoukis writing in reuters believes that the tax may very well pass.

Is that just? I hope it passes. A little justice may go a long way.

James Pilant

A Public Official Does His Job

On By southwerkIn Government Failure

A Public Official Does His Job

Phil Angelides is the Chairman of the Financial Crisis Commission. Yesterday during testimony he said this to Lloyd Blankfein, the CEO of Goldman Sachs.

“I’m just going to be blunt with you,” he told Blankfein. “It sounds to me a little bit like selling a car with faulty brakes and then buying an insurance policy on the buyer of those cars. It doesn’t seem to me that that’s a practice that inspires confidence in the market.”

(What the company was doing is explained in a McClatchy news article. Most simply it was a set of investments in which the contract created a situation that if the investements prospered, Goldman Sachs made money, but if the investments went sour, Goldman Sachs made even more money. The investor bore all the risk.)

For so much of the time after this unprecedented story of financial incompetence, greed and outright stupidity, public officials have said little but given much to the financial industry. Here is a different voice. Whether in the long term this proves sincere is still a question. But I liked the sound of it. Ethics tends to work well in an environment in which there are penalties for doing wrong. The wrong doers have profited from their actions. This is not the kind of example a country and developing civilization need. It is in fact quite dangerous when a large group of powerful Americans no longer share common interests or abide by the same rules as other Americans.

James Pilant

Heads I Win, Tails You Lose

On By southwerkIn Government Failure

Heads I Win, Tails You Lose

According to a McClatchy investigation, Goldman Sachs begin creating a new form of security in 2006. These “investments” were placed off shore in the Cayman Islands. The investments were high grade securities based on home mortgages but there was a catch. They insured these collateralized debt obligations so that the investors were on hook to cover their losses. The investors thought they were getting good investments but instead they were investing in the real estate bubble. If they lost as Goldman Sachs might have concluded was highly likely, the investors were required by contract to cover the losses. The contracts literally converted the investors into insurers. They insured that Goldman Sach would make money whether the investments did well or collapsed.

I recommend you give it a read.

Collateralized debt obligations are the chief weapon that destroyed the financial security of millions of Americans as well as countless others around the world. The McClatchy articles are an excellent way to begin to understand these strange forms of investments.

James Pilant

Bank Bailout Estimated Cost: 14 Trillion +

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Bank Bailout Estimated Cost: 14 Trillion +

According to a report by Nomi Prins and Krisztina Ugrin, the money paid out to save the banking industry is currently 14 trillion dollars while the money paid out in the stimulus and other responses to the economic crisis total almost 2 trillion dollars. So, the banking industry gets 14 trillion and regular Americans get a little less than 2 trillion scattered over hundreds of programs. Did you know that we can pay off every sub prime mortgage in the United States for 1.4 trillion? Did you know that our total exposure as a nation under the bank bailout could run as high as 23.7 trillion?
Are you feeling uncomfortable yet?

 
 

 

 

The Greatest Book Ever Dealing With Corporate Crime

On By southwerkIn Government Failure

 

The Greatest Book Ever Dealing With Corporate Crime

In 1908, Gustavus Myers, published History of the Great American Fortunes. It’s a very large work but much of what it has to say is as relevant now as it was then. For instance, he talks about the transfer of the public domain to private interests as quick way to personal riches. That has not changed.

Project Gutenberg has the complete work unfortunately mistitled Great Fortunes From Railroads. If you’re serious about the study of business ethics, you need to read it, all 712 pages of it.

James Pilant

A New Model?

On By southwerkIn Government Failure

EniacA New Model?

The impact of the new technologies, even something as ubiquitous as e-mail have only begun to be felt in many parts of society. For instance, take shareholder voting. Usually, this ratifies selection of the board of directors and takes place once a year. This is a reflection of the difficulty of getting all the shareholders together to vote or was. Really, it’s obsolete. Shareholders should be empowered by the new technologies and there should be multiple votes each year. For instance, the extravagant pay and benefits offered CEO’s and other officers of the company might require ratification by the shareholders instead of being chosen by a board of compensation often appointed by the CEO himself.

What about government? How many places could the government in this country empower citizens to make a difference in the decision making. Right now, floods of e-mails are fired in whenever a major issue appears. But we can do better. I believe right now we have the technology to eliminate fake e-mails and other nonsense from the process. If one of my websites can screen out spam and confirm my identity so I can download modifications to my video games, surely a congressional office can do the same. I don’t think they want to do this. Floods of e-mail enable a representative to vote anyway they like. Accurate e-mails reflecting the actual views of the citizens, particularly the most energized and interest citizens would likely reflect real public concerns and handicap a representative freedom to do any act they wish for any constituency for instance a corporation having made large campaign contributions.

We don’t think about these things. We act as if the world were connected by horse drawn vehicles from another age when people communicate with every part of the world in tenths of a second. Let’s start thinking and start building a society where people matter.

James Pilant