FedUpUSA

Archive for March 8th, 2011

I guess this from Bloomberg should come as no shock, really….

A bipartisan group of U.S. senators is drafting legislation to delay debit-card “swipe” fee rules that banks say would cost them billions of dollars, according to two Senate aides with knowledge of the plan.

Senators Jon Tester of Montana and Tom Carper of Delaware, both Democrats, are working on the bill’s language with Senator Bob Corker, a Tennessee Republican, according to the two aides who requested anonymity because the talks aren’t public.

The Federal Reserve proposed capping debit-card interchange fees charged to merchants at 12 cents per transaction under a Dodd-Frank Act requirement to align them more closely with the processing costs. A bill to delay the measure, which may come this week, would be the first legislative attack on a rule that could cost lenders including Bank of America Corp. (BAC) and JPMorgan Chase & Co. (JPM) as much as $12 billion in annual revenue.

“There’s no question legislation is being looked at,” Corker said in an interview. “The question we’re dealing with now is, what’s the best way of approaching this issue?” The lawmakers discussed the shape of a bill on the Senate floor last night, Corker said.

Opponents of the rule have found supporters in Fed Chairman Ben S. Bernanke and Federal Deposit Insurance Corp. Chairman Sheila Bair, who questioned a provision exempting banks and credit unions with less than $10 billion in assets, saying it may have the unintended consequence of harming smaller lenders.

So, yet again, those who can pay for legislation, get legislation.

I’m going to post this chart until everyone gets it through their heads. 

This is now a fully-closed system.  You are not a part of it.  I don’t care if you are left or right or Republican or Democrat, conservative or liberal or red-white-and-blue striped - YOU ARE NOT PART OF THE SYSTEM ANYMORE.  Government of The People, by The People and for The People is history.  Kaput.  Gone.  Fini.  

What, it’s been all of two months since the Republicans were supposed to rescue us all?   Yet, just like the Democrats before them they are doing the work of those who put them into office – but I do not refer to the voters – I mean those that paid for their campaigns.  Republican = Democrat = Members of the Oligarchy, funded by those with very deep pockets, especially the banks.  You remember?  Those entities that we are continuing to fund with our taxpayer dollars, lest everyone find out that they are really insolvent.  Yes.  Those banks.

There is no rule of law; no equal protection.  Laws apply only to the ‘little people’ while the people who can fund legislation (lobbyists, big corporations, banks on Wall Street), get exemptions.  They write laws that allow them to commit criminal acts – legally.  They get to elminate usury laws.  They can charge exhorbitant fees.  They can force you to purchase things against your will.  They can skirt taxes.  They can somehow dodge criminal prosecution for direct (on tape) perjury before Congress itself.  They can foreclose on homes they do not have legal rights to.  They can even frighten Congress so badly that they will pass legislation to fund a revolving line of credit with no limits upon the heads of every American Taxpayer (TARP). 

However, perhaps most grievous of all, they can ‘print’ money by purchasing our own debt, thereby devaluing our dollars, and resulting in the massive price inflation in commodities (you know, goods you NEED to buy), at the same time depressing our wages, while simultaneously collapsing our asset values (homes, fixed income pensions) AND the margins of the small, businesses that provide for our production and our employment (but which are not wealthy or big enough to fund legislation).   And why all the money printing?  Refer to aforementioned ’insolvent banking institutions’ that…..pay for legislation favorable to them, and catastrophic to you.  Wash, rinse, repeat.

I’ll say it again:  YOU ARE NOT PART OF THE SYSTEM ANY LONGER.

On March 26-27, the National Constitution Center will host an interactive, interdisciplinary forum and workshop titled “Can We Talk? A Conversation about Civility and Democracy in America,” in which FedUpUSA.org has been asked to take part. 

Below is a response to last week’s question: “What can we learn from the budget showdown in Wisconsin about building the political consensus needed for long-term solutions?”

Unfortunately, this is reality when it comes to the subject of economics.  The time to build a consensus ended in 2003 just prior to the massive real estate bubble blown as a result of terrible economic policy.  Economics is not a partisan issue, although both sides of the aisle have made it so.

The biggest lesson to be learned from Wisconsin is that when there is no money, there is no money.  This is our reality, like it or not.  Partisanship has made Wisconsin into an argument over unions.  This is not the real issue.

To generate revenue, the nation must be productive, or generate GDP.   Because our economy was built on what amounts to a giant Ponzi scheme that relied upon private sector spending on consumer goods (like houses, cars and iPods), which accelerated in 2003, and collapsed in 2007, right now, the majority of our ‘GDP’ comes from deficit spending .

Quite frankly, this is the only thing that is keeping us from recognizing a full-on economic depression.  If you raise taxes, you subtract directly from what is left of private spending.  Refuse to raise taxes and the government is forced to continue to borrow.  For each cut in spending there is a corresponding cut in GDP.  The current House spending bill proposes to cut $61 billion from the budget, which would decrease GDP by 1.5 to 2 percentage points in the next quarter according to Goldman Sachs.

As a nation we took in approximately $2 trillion in federal tax revenues (source:IRS 2010).  We spent almost $4 trillion.  To spend only what was taken in, you would have to decrease government spending by 42%, or $1.7 trillion for calendar 2010. Removing that would result in a decrease in GDP of 50% !   (The definition of a depression is a contraction in GDP of 10% or more year on year.)  This is the mathematical fact of our situation and I am not the only one who realizes this.  Goldman Sachs came out with a report on February 23, 2010 that says much the same thing.

The United States no longer produces anything but debt.  You can’t get out of debt when it is all you produce.  We’re stuck in a box that is slowly being crushed.  The only thing we need to have a consensus about is the numbers on paper and the reality of our situation.

Stephanie Jasky is the Founder and Director of FedUpUSA.org.

National Constitution Center