There Are 19 Million Vacant Homes In The US from Consumerist

19 million homes are currently vacant and for sale, either through foreclosure or bank seizure or just because no one feels like living there — and 19 million is a record.

From Bloomberg:

rest http://consumerist.com/5145628/there-are-19-million-vacant-homes-in-the-us

Idiot: Joe the Plumber: ‘I don’t know if the American public deserve me.’ from Think Progress

Yesterday, the ubiquitous Samuel Joseph Wurzelbacher — aka "Joe the Plumber" and "Joe the War Correspondent" — became "Joe the Economist" when he went and spoke to a House GOP breakfast on the economic recovery package. The New York Daily News caught with Wurzelbacher and asked about the meeting:

"It's not politically incorrect to say you're Republican or conservative," Joe said. "They need to dig their heels in and fight for what needs to be done." […]

One thing that needs to be done, he said, is killing this stimulus package, because it's just another example of "American government" — Republicans and Democrats — "kicking our butts left and right." He also called it welfare.

rest http://thinkprogress.org/2009/02/04/joe-plumber-stimulus/

Madoff whistleblower: SEC “abject failure” from Politics in the Zeros.

Harry Markopolos, who told the SEC about Madoff in 2005, will testify before Congress today. (prepared statement PDF)

From financial journalist Gary Weiss

It is absolutely devastating. Among other things, Markopolos says that because of the SEC's "abject failure" to do anything, because of its "investigative ineptitude and financial illiteracy," he was in fear for the safety of his family.

No. It was not incompetence. It was quite deliberate. SEC was headed by free marketeer zealots who quite methodically set out to insure that nothing would "interfere" with the markets.

Of course there was certainly ample opportunity for corruption too. Not to mention Markopolos being, probably quite justifiably, scared for his life. "If Mr. Madoff was facing life in prison, there was little to no downside for him to remove any such threat," he said.

So Markopolos apparently thinks Madoff is quite capable of having someone killed. Tell me, just who is this Madoff fellow and most especially, who are those, still hiding in the shadows, that helped him pull this off?

This is an infuriating document. Infuriating to me personally, because I can tell you that if Markopolous had come to me or to anyone at Business Week — which at that time (May 2000) had editors who could actually understand such things — he'd have been taken seriously and his allegations would have been investigated thoroughly.

rest http://polizeros.com/2009/02/04/madoff-whistleblower-sec-abject-failure/

TARP Recipients Paid Out $114 Million for Politicking Last Year from Capital Eye

The companies that have been awarded taxpayers' money from Congress's bailout bill spent $77 million on lobbying and $37 million on federal campaign contributions, Center finds. The return on investment: 267,208 percent.

 
WASHINGTON--The struggling companies whose freewheeling business practices have contributed to the country's economic woes are getting a lucrative return on at least one of their investments. Beneficiaries of the $700 billion bailout package in the finance and automotive industries have spent a total of $114.2 million on lobbying in the past year and contributions toward the 2008 election, the nonpartisan Center for Responsive Politics has found. The companies' political activities have, in part, yielded them $305.2 billion from the federal government's Troubled Asset Relief Program (TARP), an extraordinary return of 267,208 percent.

"Even in the best economic times, you won't find an investment with a greater payoff than what these companies have been getting," said Sheila Krumholz, the Center's executive director. "Some of the companies and industries that have received payments may now consider their contributions and lobbying to be the smartest investments they've made in years." 

While the Treasury Department, not Congress, doles out TARP funds to specific institutions, congressional lawmakers had to authorize that money in the first place, and lawmakers will determine in the future whether to release more funds to prop up the U.S. economy. During the bill-writing process, members of Congress were able to specify to some extent where the money should go, and they have lobbied regulators to urge them to inject funds into specific banks and financial institutions, including those in lawmakers' own districts.  

"Taxpayers hope their money is being allocated entirely on the merits, but with Congress controlling how much money the Treasury gets to hand out, it will be impossible to completely exclude politics from this process," Krumholz said.

Some of the top recipients of contributions from companies receiving TARP money are the same members of Congress who chair committees charged with regulating the financial sector and overseeing the effectiveness of this unprecedented government program. They include Sen. Chris Dodd of Connecticut, chairman of the Senate Committee on Banking, Housing and Urban Affairs (he received $854,200 from the companies in the 2008 election cycle, including money to his presidential campaign) and Sen. Max Baucus of Montana, chair of the Senate Finance Committee (he received $279,000). In total, members of the Senate Committee on Banking, Housing and Urban Affairs, Senate Finance Committee and House Financial Services Committee received $5.2 million from TARP recipients in the 2007-2008 election cycle. President Obama collected at least $4.3 million from employees at these companies for his presidential campaign.

Some, Not All, TARP Recipients Hired Lobbyists

Of the more than 300 companies that have been aided by TARP, 25 paid lobbyists a total of $76.7 million to represent them on Capitol Hill in 2008. Treasury Secretary Tim Geithner said recently that institutions collecting these funds won't be allowed to lobby the federal government going forward. In the 4th Quarter of 2008, when Congress was crafting bailout legislation, these companies spent $17.8 million on lobbying--less than what they spent in the prior three quarters, probably because they were strapped for cash.

rest http://www.opensecrets.org/news/2009/02/tarp-recipients-paid-out-114-m.html

Welcome America to Your Sizzlin’ Larry Summers Shitburger from Firedoglake

visual stylings by phoenix woman

Yum.  Get 'em while they're hot:

Instead of taking a single approach, the Obama administration plans to divide assets and other loans into three categories, each with its own solution, according to sources familiar with the discussions, speaking on condition of anonymity because the details are not finalized.

The government would buy and hold on to those assets whose falling prices are putting banks under the most pressure. Officials want to limit these purchases because of the vast expense.

The centerpiece of the plan would be a guarantee to limit losses on a second group of troubled assets that can be kept by the banks because they have more stable prices.

And it would allow banks to retain and profit from their healthiest assets.

Which means you, America, get shit.  Do you get to have better healthcare, more public transit, clean air, better schools or more jobs if the banks you've invested so heavily in make money?

No!   The bankers who built this shitpile get to keep that.  You just get the losses.

rest http://firedoglake.com/2009/02/04/welcome-america-to-your-sizzlin-larry-summers-shitburger/

A Bit More on Obama’s Executive Compensation Stand from The Washington Independent

Following up on Mary's post, it's also worth noting that the $500,000 executive-pay limit for bailed out banks to be unveiled today by the White House seems to apply to total compensation — meaning salary, bonuses, stock options, everything.

That would be a sharp break from the Bush administration's Wall Street bailout bill, which did very little to rein in the enormous pay packages enjoyed by Wall Street executives, even after they'd run their companies into the ground. Under TARP, for example, the limits on golden parachute retirement packages applied only to the five top-paid employees of the bailed-out firm — and only if the firm accepted more than $300 million of taxpayer funding.

The Obama team's limits also seem poised to go further than the TARP-reform bill passed by the House last month. That proposal, which the Senate never considered, would have limited executive bonuses and incentive-based pay, but not salaries — a loophole that would have allowed bailed-out firms to pay their executives anything they pleased.

rest http://washingtonindependent.com/28902/a-bit-more-on-obamas-executive-compensation-stand

Republican Lobbyists Kill Michigan Foreclosure Relief from Political Affairs Magazine

GRAND RAPIDS, Mich. – The same Republican-owned law firm that may have tried to help Michigan Republicans hand an electoral victory to John McCain here in the November presidential election may also be blocking effective foreclosure relief legislation.

GRAND RAPIDS, Mich. – The same Republican-owned law firm that may have tried to help Michigan Republicans hand an electoral victory to John McCain here in the November presidential election may also be blocking effective foreclosure relief legislation, the news Web site Michigan Messenger reported this week.

Michigan Messenger broke a story last fall quoting state Republican Party officials as saying they planned to use a list of home foreclosures to challenge voters at the poll sin the Detroit area. The Web site further reported that such a list may have been obtained from Trott and Trott, an area law firm whose owner, David Trott, who had given thousands to the McCain campaign.

Trott and Trott, located in a suburb of Detroit, handles the paperwork for "thousands of foreclosed homes," the Michigan Messenger reported.

After the story about the Republican Party plan to use a foreclosure list possibly obtained from Trott and Trott broke, Republican Party officials denied the published quotes and threatened to sue the Web site. The threatened suits never materialized and heavy coverage of the incident forced Republican Party officials to back away from their plan to challenge voters.

Now, it appears the Trott and Trott firm may be intervening in Michigan state politics to singlehandedly weaken or block legislation that will help troubled homeowners renegotiate the terms of their mortgages, keep their homes and pay their bills, the Michigan Messenger has reported.

A bill, Home Foreclosure Prevention Act, introduced in the Michigan state legislature by Gov. Jennifer Granholm last December would have helped homeowners negotiate a new settlement with lenders before foreclosure proceedings. The bill, approved by the Democratic-controlled state House, was blocked in the Republican-controlled state Senate.

Democratic leaders in the state legislature blamed the failure of the bill on the lobbying efforts of Trott and Trott, which gives thousands to the Republican Party and enjoys a hefty business from foreclosure proceedings.

Further, the Michigan Messenger reported, one Democratic leader said that he was told by a Senate Republican leader that the Senate version of the bill was actually authored by Trott and Trott lawyers. Other Democrats in the state legislature also to that news Web site that Trott and Trott lobbyists helped kill previous foreclosure relief efforts.

rest http://politicalaffairs.net/article/view/8081/

Obama moves to limit TARP exec pay from Congress Matters

Some welcome news:

The Obama administration is expected to impose a cap of $500,000 for top executives at companies that receive large amounts of bailout money, according to people familiar with the plan.

Executives would also be prohibited from receiving any bonuses above their base pay, except for normal stock dividends.

It remains to be seen how well this holds up, of course. If there's one thing at which Wall Street excels, it's finding alternative methods to pipe money around regulations. But it's a step in the right direction, and one you would never have gotten out of the Bush "administration." And frankly, as recently as four days ago, we weren't so sure we were going to get it out of this one, either. (Are you keeping tabs on your source's track record, WaPo? He could certainly have been right at the time, of course. But keep score somewhere. Just a suggestion.)

I think it's fair to guess that lots will be said about this quote -- truly one for the ages:

"That is pretty draconian — $500,000 is not a lot of money, particularly if there is no bonus," said James F. Reda, founder and managing director of James F. Reda & Associates, a compensation consulting firm. "And you know these companies that are in trouble are not going to pay much of an annual dividend."

Mr. Reda said only a handful of big companies pay chief executives and other senior executives $500,000 or less in total compensation. He said such limits will make it hard for the companies to recruit and keep executives, most of whom could earn more money at other firms.

"It would be really tough to get people to staff" companies that are forced to impose these limits, he said. "I don't think this will work."

It's true. It is pretty draconian.

rest http://www.congressmatters.com/storyonly/2009/2/4/94511/26834

The "Make Him Do It" Dynamic In Action: Obama to Back Sanders' Crackdown on Executive Pay from Open Left

This week, I wrote my syndicated newspaper column about what I called "The Make Him Do It" Dynamic - that is, how congressional progressives - with the help of the progressive movement - were having success pushing President Obama to take much stronger stands on issues than he seems inclined to take. And yesterday, I noted that Sen. Bernie Sanders (I-VT) has been working with the progressive movement to push a legislative crackdown on executive pay at banks taking bailout money. Well, today, President Obama finally responded, announcing his support for such a crackdown.

Though we don't know the full details of Obama's plan, it is a pretty clear reversal of his administration's earlier declaration that it would oppose limits on executive pay.

rest http://www.openleft.com/showDiary.do?diaryId=11349

Wells Fargo Cancels Execs’ Las Vegas Mega-Party from Firedoglake

Wells Fargo, which received $25 billion in bail out money, hastily canceled a 12-night ultra-post Las Vegas getaway for the company's top mortgage officers when the media--both bloggers and MSM-- and Washington lawmakers  expressed deep-seated, pitchforks-and-torches outrage.

Reports the Wall Street Journal:

Initially, a spokesman for Wells Fargo said in a statement, the bank wasn't going to back away from holding the conference. Just hours later, as television networks and bloggers pummeled the bank, Wells Fargo began backpedaling.

rest http://lafiga.firedoglake.com/2009/02/04/well-fargo-cancels-execs-las-vegas-mega-party/

Democratic Senator Ben Nelson May Oppose Stimulus Package Because Of Pell Grant Funding from Think Progress

from http://thinkprogress.org/2009/02/02/nelson-pell-grants/

College students sought financial aid in record numbers last year, leading even Bush administration officials to call for an increase in Pell Grant funding — "the most important form of aid to needy students."

Yet Sen. Ben Nelson (D-NE) is arguing against the House version of the economic recovery package because of its funding for Pell Grants. Nelson says he wants to eliminate "non-stimulative" and non-"job creation" items in the bill:

Even some Democrats are speaking out against including popular programs — such as an almost $15 billion increase in funding for Pell grants for higher education — in legislation that is supposed to spark an economic recovery. "You don't want to be against Pell grants," said Sen. Ben. Nelson (D-Neb.). "But the question is: How many people go to work on Pell grants?"

Increasing Pell Grant funding is a key way to preserve jobs in this tough economy. As grant recipients pay tuition and buy books, college faculty and staff will stay employed at a time when the education sector is experiencing widespread job cuts.

And with unemployment rising, Pell Grants provide workers with greater access to higher education — boosting their prospects for gaining employment. CAP's Will Straw notes:

Improving the skills of unemployed American workers and providing funds to allow lower-income students to work their way through college would provide a boost to the economy and improve the workforce skills needed when businesses begin to hire again as the economy improves.

Furthermore, because the recession has forced colleges to raise tuition and cut aid, students receiving Pell Grants will quickly spend their loans, providing a short-term stimulus to the economy. In the long-term, increasing access to higher education is an investment that will help alleviate a human capital-starved economy.

Although Nelson has certainly championed Pell Grant funding in the past, he is echoing right-wing talking points in labeling parts of the bill as "non-stimulative." Putting off the Pell Grant shortfall for a later date is something the economy cannot afford.

Scandal: Tom Daschle Is Rich from Gawker

How Washington works: pay your dues as a Senator, then your rich friends get you a consulting gig and free car service! Then you forget to pay your taxes and it complicates your cabinet nomination.

That is the story of Tom Daschle, the former Senator and Obama's pick for Secretary of Health and Human Services. He is the guy who will fix health care, once his embarrassing tax issues are dealt with. All because a rich friend of his gave him millions of dollars to sit on the board of his media company that, oddly, had no business with the government. And also his friend let him use his Cadillac and driver for free, whenever he was out of town, and Daschle didn't pay taxes on that, because who knew?

And so Daschle's accountant finally told him that he owed $150 grand in taxes, on that car, but he can afford it because his rich friend's investment firm gave Daschle $2 million to raise money and sit on the board, with other former lawmakers and random notable political types.

rest http://gawker.com/5144360/scandal-tom-daschle-is-rich

Romer responds to distortions of her research: GOP analysis is ‘flat wrong’ and ‘absolutely incorrect.’ from Think Progress

from http://thinkprogress.org/2009/02/02/romer-gop-analysis/

Last week, House Republicans offered a tax-cut heavy alternative economic recovery plan that they claimed would create 6.2 million jobs. The conclusion was based on a distortion of past research done by Council of Economic Advisers Chair Christina Romer. Over the weekend, Berkeley economist Brad DeLong obtained Romer's response to the GOP's misuse of her work. "Romer's view is that the House analysis is absolutely incorrect," said the White House talking points:

Question: The House claims that based on the research of CEA Chair Christy Romer, their plan would create 6.2 million jobs. Isn't that a more effective way of jumpstarting the economy?

Answer: The Republican House analysis is flat wrong in its claim that the House Republican stimulus is more effective. No matter what your analytical assumptions, as long as they are consistent the plan the President supports would result in substantially greater job creation than the House Republican plan.

As CAPAF Senior Fellow James Kvaal has pointed out, the conclusion of the Romer paper that the GOP is quoting was "that the economic environment complicates the assessment of policy changes, not that tax cuts are the most effective way to create jobs." A more recent analysis by Romer and Jared Bernstein concluded that government investment creates more jobs than tax cuts.

The Financial Community Reinvestment Act from Dealbreaker

from http://dealbreaker.com/2009/02/the-financial-community-reinve.php

Much as it pains us to point out that it was government pressured lending that got us here in the first place, it was government pressured lending that got us here in the first place. Having absorbed exactly zero from the last bubble's explosion...

President Barack Obama will require banks to boost lending to consumers and companies in return for taxpayer aid from the $700 billion bailout fund, in a departure from Bush administration policy, a key lawmaker said.

"You're going to see the Obama administration," learning lessons from the first phase of the program, "push for much more lending," House Financial Services Committee Chairman Barney Frank, who helped write the financial-rescue law, said yesterday on ABC television's This Week program. "There are going to be some real rules in there."

If there is a formula to load the balance sheets of institutions with more bad loans, this probably looks a lot like it.

We can't really say we want to see banks doing all that much lending at the moment. Debting our way out of the current crisis is simply not a solution. It merely delays the problem, and pays it back later- with interest.

The United States enjoyed an eye-popping period of largely artificial growth the last two or three years (if not the last five), and one thing that never seems to sink in is that many of these "losses" are merely the evaporation of as much mist under the harsh sunlight of reality. This is a short way of saying that there is no escape from the pain but to endure the pain for awhile- you never had those assets anyhow, unless you sold them for cash. They were an illusion. Your only way to capitalize on them was to unload them on a greater fool before the sun came up. If you missed the boat, that's too bad but those are the breaks.

Certainly, the present administration is under a lot of pressure to produce "results" and press the magic button under the President's desk to make everything all-better. This is a self-inflicted wound, since they got themselves elected by setting expectations high. Very high. Unfortunately, it doesn't work that way, and until someone points out that more debt (particularly that issued by decree) is not exactly an answer, we are all in a lot of trouble.

Obama to Require Banks Receiving Aid to Boost Lending [Bloomberg]

Joe Scarborough: Obama’s Trying To ‘Buy Off People’ With ‘Pure, Straight Socialism’ from Think Progress

from http://thinkprogress.org/2009/02/02/scarborough-stimulus-socialism/

MSNBC's Joe Scarborough went off on a tear against President Obama's proposed stimulus plan this morning, slamming tax credits for people who, according to him, "don't pay taxes." "It's not even welfare!" he shouted, and accused Obama of trying to "buy off your constituents":

SCARBOROUGH: You're not going to get Republicans to line up and support tax cuts for people who don't pay taxes. That's taking you to a position now where you have the federal government — and this is very dangerous — just writing checks to people for doing nothing. It's not even welfare. … If you want pure straight socialism, if you want to buy off people, do that.

Watch it:http://www.youtube.com/watch?v=R4NElRfIVwU

Popout

There are enormous problems with this analysis. First, Americans benefiting from the tax cut do pay taxes — sales taxes, payroll taxes, social security taxes — even if they don't pay income tax. In fact, those in the lowest income bracket pay about 4.3 percent of their income to federal taxes.

The tax credit isn't some kind of charity; it's one of the most effective kinds of tax cuts in terms of stimulating the economy. Moody's chief ecomomist Mark Zandi showed that the refundable tax credit gives the economy a far greater "bang for the buck" than non-refundable tax cuts, corporate tax cuts, or making Bush's tax cuts permanent, the "solutions" proposed by conservatives:

What's more, as Center for American Progress Action Fund President John Podesta pointed out to Scarborough minutes later, these tax cuts were something that "Barack Obama campaigned on all year long" — and he encountered the exact same fearmongering accusations of "socialism" from conservatives. If Americans didn't support Obama's tax plan, they wouldn't have voted for him.