16. December 2008 by David A. Peterson.

The view from the suburbs is that times are tough. Everyone knows that there are too many people chasing too few jobs at the moment.

 The government has stepped in, unemployment benefits are being extended. Medicaid programs at both the State and Federal levels are expected to grow dramatically over the next year. TARP’s and Automaker’s bailouts are all moving forward.

These types of social, jobs, economic, and entitlement programs will continue to balloon in the absence of serious job growth. The American taxpayer along with social and religious organizations will all step up to the plate to help those truly in need.

Suburbanites see the government trying to perform. You may agree with the government or you may hate every action being taken but you must admit there are a lot of people working overtime right now trying to arrest the economic problem.

What don’t suburbanites see in their viewfinders right now? The short answer is… trust. Especially trust in government.

Our stock markets and commodity markets are all built on the truth that economies expand. And if these future earnings and future prices don’t expand then the government has to help by using fiscal policy to keep the economy moving in the right direction.

But what happens if we can no longer trust those who we put in charge of our futures, our elected officials and those that they appoint to run the government? What happens when there is a lack of trust?

Look at Bernard Madoff’s $50,000,000,000 Ponzi scheme. Can investors really trust the SEC to actually regulate one of their own? How about Representative William J Jefferson (D-LA) and the cash in the freezer? Or Senator Ted Stevens (R-AK) receiving gifts and home improvements and not disclosing them.

Alaska has a tainted ex-Republican Governor, Illinois has one in jail. The list of those caught with their hand in the cookie jar just keeps getting longer. Democrats blaming the Bush Administration for the current economic plight while Barney Frank (D-MA) worked hard on getting lending rules loosened at a time when they should have been tightened.

Oh yea, let’s not forget about the ballots being found in a trunk of a car in Minnesota. How does Minnesota Senatorial candidate Al Franken sleep at night?

The McCain/Palin ticket may have missed the economic pitch this past election cycle but they hit the trust factor ball out of the park. Americans and the world as a whole are seeing and feeling the issue first hand with our shaky stock market and our shaky job’s market.

Trust in leadership?

 The American people are looking for a strong leader to get us out of this economic mess yet the President-elect already has strike one against him. Someone from his staff may have been in talks with Governor Blagojevich.  The Governor was just trying to sell the Illinois Senate seat and everyone knows that is no big deal for Chicago politics.

 Even if President-elect Obama and/or his entire staff had nothing to do with the current scandal in Illinois it still smells like they did.

What should the Republican Party do about this?

 Politically -nothing. This is normal Chicago politics. The view from the suburbs is “what do you expect?”  I don’t even live in Illinois but I expect that this is pretty much the way it is.  The FBI did its job and will prosecute to the full extent of the law. Rod Blagojevich will no longer be entitled to his governorship and may actually do jail time. Also, this scandal will dog the Democratic Party without any help from the Republicans.

 What should the Democratic Party do about this?

Politically -everything. Democrats have to realize that this smells. And if they allow it to grow by being secretive or not coming forward early with all of the facts it will dog the newly elected President. The country cannot afford a weak President right now. Democrats only need to look to the recent Republican past to find out what happens when the country doesn’t trust your judgment.

 The view from the suburbs is that times are tough. Suburbanites need to know that the government is capable of forming a plan without putting its individual members ahead of the taxpayers and the people who are truly in need.

 What else should the Republican Party do about this?

 The next national election cycle is only two years away. McCain and Palin correctly pointed out that there is too much corruption in government including the Republican Party. The RNC needs to find trustworthy candidates that are on top of the issues. I mean squeaky clean candidates that can bring a fresh voice to the issues and have innate problem solving abilities.

What else should the Democratic Party do about this?

For starters they could push for a special Senatorial election in Illinois. They could also do themselves a favor by not giving Caroline Kennedy her New York Senatorial birthright and showing the country that no one is entitled to an elected position.

 What will we be viewing from the suburbs?

Will the Democrats do the right thing? Reform government, stop the shady deals, stop political entitlements, and demand that regulators do their jobs? I doubt it, but luckily for the rest of us the next election is only 2 years away. Hopefully the people truly in need can hang on until then.

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12. December 2008 by David A. Peterson.

Who owns this problem? On who’s shoulders does this defeat of the $14 billion auto rescue bill fall on? Should there even be a rescue bill?

There are only 5 major players. They are:

1. The President
2. The Big Three Automakers
3. The UAW
4. The Senate
5. The House

That’s it - there is no one else hiding in the closet, so who owns the problem?

If you are watching TV or listening to the commentators on the radio  at any one moment in time you get a distorted view of the issues, the players, and last night’s outcome. Last night the $14,000,000,000 auto rescue bill was defeated 52 - 35. This was just a procedural vote (i.e. a vote that confirmed a predetermine outcome). Senators knew they didn’t have enough votes to pass the legislation, so they voted to make it official. 

This morning I turned on the TV news and at that moment in time I saw Debbie Stabenow the Democratic Senator from Michigan slinging sound bites with passion. She obviously believes in what she is saying and it appears that she can’t understand why others don’t see it her way. She was not very flattering to Senate Republicans. Here are the points I took away (you can see the complete speech on YouTube.com):

•  ”…as long as the the workers were willing  to take all of the cuts … before the negotiations…”
• “The only thing that matters (to Republicans) is that workers get paid too much”
• “…we are willing to sock  it to the workers…”

At another point in time, again this morning on CNBC, Senator Bob Corker (R-TN) was given his chance to tell the Republican side of the story. His points were:

•  ”…we were three words away….” from passing the bill.
• “…we were looking for a finite date,  to get wages competitive with the other foreign automakers.”
• The UAW was unwilling to give wage concessions even though they would be negotiated and certified by the incoming Secretary of Labor. Even though that Secretary would be appointed by President Obama.  
• “What kills me… we had a historic opportunity to get these companies healthy.”

Senator Corker was asked, “if this goes down badly don’t you worry about owning the problem?” He replied, “Do we own the problem?”

Regardless of the soundbites that are being slung, at the end of the day, no matter who you believe, the taxpayers are being asked to own the entire problem. The President may step in soon and give $14 billion of TARP money to the automakers. Either way, if the Congress passes legislation or if the President steps up to the plate - you and I are going to pay for it.

Who owns the problem? How about the automakers? I’m an ex-enlisted Navy guy. The thing you learn when you join the Navy is that the Captain is always in charge. What ever happens to that ship is the Captain’s responsibility. If the Ship wins the battle the Captain is a hero, if the ship loses the battle it’s the Captain’s fault - no exceptions - ever.

In this case all three automakers need to step up.  They each have a Captain and that Captain is not the American taxpayer.

The automakers can’t get private financing for a reason: Their current business model is in trouble. Do you think I’m wrong? I bet Google could get a private loan right now even though its own stock price is 50% less than it was last year.

At least two out of three of the automakers will go belly up in to Chapter 11. Chrysler may have to liquidate (just a guess since they tried to sell themselves like a whore this past fall) and GM, well GM is flat out of money.

The Captains of all three automakers need to save their own ships. Getting money from the taxpayers without already negoitiating with all of the parties was and still is a silly idea. $14,000,000,000 “bridge loan.” A loan is something that gets paid back. The current business model ensures that it could not be paid back.

The Captains of the automakers should have already negotiated their respective plans before asking for a “bridge loan.” The UAW (Ron Gettelfinger - President) should have already made concessions before stepping in front of the camera’s in the House and Senate hearings over the last few weeks. The suppliers should already be banning together to ensure an orderly way out of the mess.

Note to all of the Captains involved in this mess. If you want to survive as a growing concern you need to be at general quarters now. Not in March 2009, not waiting for some “Car Czar,” not just holding on, you need to know what to do now. If not then each of you “own the problem.” Don’t drop it on the taxpayers - I can’t fix it from my laptop, you have to fix your own problems.

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