A lot of virtual ink has been spilled over the on-going economic crisis in California. Lost in the uproar is the fact that 6 other states are also having budget crisis of their own.
Most ideas for solving California's fiscal situation involve draconian cuts and higher taxes. Both are unavoidable at this late date.
However, in every crisis there is opportunity for more radical, progressive, long-term ideas. I would now like to present an idea for comment.
China is at it once again, to remove the dollar as the world reserve currency and they are bringing their pals, India and Russia to join in.
China will push reform of the international currency system to make it more diversified and reasonable, and to reduce excessive reliance on the current reserve currencies, the People's Bank of China said Friday.
"To avoid the shortcomings of sovereign credit currencies acting as reserve currencies, we need to create an ... international reserve currency that can maintain the long-term stability of its value," the PBOC said.
It was the morning of January 22, 1932, in a quiet, middle-class neighborhood of the Bronx. A crowd was gathering in front of 2302 Olinville Avenue, near the Bronx Park.
City Marshals and Police had moved in to evict 17 tenants who were on a "rent strike". A crowd of 4,000 had gathered nearby.
When the marshals moved into the building and the first stick of furniture appeared on the street, the crowd charged the police and began pummeling them with fists, stones, and sticks, while the "non-combatants urged the belligerents to greater fury with anathemas for capitalism, the police and landlords." The outnumbered police barely held their lines until reinforcements arrived.
Every single reserve police officer in the Bronx had to be called in to prevent being routed by the rioters.
The recent increases in health care costs look a lot like what happens in a market when an oligarchy or monopoly raises barriers of entry to squeeze out competition. The reason for this may be accidental- they might all be using the best scientific statistics possible to set prices, thus making all their prices close to the same. But the end result is the same- increased cost to consumer due to a lack of choice, resulting in incredible profits being returned to stockholders, who then reward C-level executives with outlandish compensation packages.
So far, the reasoning is sound. But the solution seems to be novel: Add a low-cost/low-value public option to cover those who can't get insurance otherwise or for whom the low-cost option is sufficient, to add competition to the marketplace.
Where have we since this song before? Here is an AP video highlight of Federal Reserve Chair Ben Bernanke's testimony before the House Oversight committee, addressing whether or not the Federal Reserve pressured Bank of America to buy Merrill Lynch. (See this post for background and details).
I guess thou holy elected officials are getting a bit testy. They aren't accustomed to not getting their monuments on Mt Olympus. Apparently Maxine wants a new building named after her but they just won't give up the money.
How the heck are these people ever elected and even worse, re-elected.
We are so screwed! They don't care because it isn't their money and when more is needed they either print it or tax us.
" A plan by House Appropriations Chairman David Obey (D-Wis.) to ban “monuments to me” in this year’s appropriations bills has been sharply criticized behind closed doors by a senior Democrat who wants to direct $1 million to an employment center in her district bearing her name.
Thus within 18 months of taking office, Obama will likely have appointed five of the seven Fed governors . The central bank is designed to be independent from politics, so a president's best chance of influencing how the Fed will regulate banks or respond to economic changes is through these appointments.
The Federal Reserve acts independently of government, with pretty much only these appointments, each a 14 year term, and confirmation of each governor by the Senate.
Considering we cannot find out which institutions received Federal money or where the $12.82 trillion dollars of Federal Reserve financial commitments are, isn't this making the Democratic aspects of financial regulation even worse?
During the Bush administration we had then Treasury Secretary Hank Paulson, acting as CEO in Chief, strong arming banks and even Congress into passage and use of the TARP. No other ideas were seriously considered and Congress simply handed over the cash with a lot of scare tactic rhetoric.
It's Friday Night! Party Time! Time to relax, put your feet up on the couch, lay back, and watch some detailed videos on economic policy!
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