Saturday, September 6, 2008

A two rant weekend

Washington bureaucrats are fond, it seems, of wagging their finger at corruption, usually towards external countries. We Americans tend to take it for granted that our higher institutions are above the practice of tawdry, illegal behavior driven by greed. We tend to think that "corruption only happens in Banana republics and other third world countries. That is, until we are slapped in the face with an Enron, or a Worldcom, or Wall Street et. al. and the "credit crisis" that has evolved into a full blown global recession.

Speaking of Wall Street we all now know that crooked, deceptive practices there frequently gum up the works, but none of us were prepared for the scale of the heist involving the packaging of crap mortgage loans. However, to me the following emerging story takes the cake.

Citigroup, one of the biggest perpetrators/losers in the credit crisis, recently paid $18 million in refunds and settlement charges for stealing $14 million from customers' credit-card accounts. The bank had an "account sweeping program" that automatically removed positive balances from customers' credit-card accounts. If a customer double paid a bill by mistake or refunded a purchase, Citigroup took the positive balance without notification, in other words, outright stole it. In defense, Citi said it voluntarily stopped the program in 2003. In a statement, it added, "We take issue with the state's characterization of our conduct and the parties' voluntary settlement." More info

I have been trying really hard to learn to not get upset. I have been pelted with advise from my loving wife about "letting go" and "not sweating the small stuff". I can see a certain brilliance in this strategy. I really can. The result of my efforts at "anger management" have been pretty successful frankly. But the above story has my blood boiling. I am not just angry about yet another institution being caught with their hand in the till stealing from consumers too old or too debt sodden to figure out what is going on. I am also angry with California's AG (Jerry Brown) for letting them off the hook with a slap on the wrist fine plus restitution. I want the bastards at the top level of Citibank to do time. They are scumbags and deserve a jail sentence. If you or I were to reach into the till of a 7-11 store while a confused clerk wasn't looking, and were caught undeniably, we would do time, or at least end up with a conviction for a felony. (If you happened to be in Texas and were black, chances are that your time would be at least several months and you would do it.) As it is, about the only thing I can do is tear up my Citibank VISA and send it in. I will never, ever, do any amount of business with this bank again. That organization is definitely one of the evil ones. I urge you to consider the same if you have an account there.

When it comes to rants about Jimmy Durante used to say...I got a million of em, a million of em". But this one sticks in my craw more then most:

Recent projections by the Office of Management and Budget and the Congressional Budget Office reveal that the highway trust fund will run out of money during FY 2009. Unless the fund is replenished soon, federal spending on highways could decline significantly as the fund reverts to a spend-as-you-earn basis until a permanent remedy is enacted. Until then, one solution is to re-concentrate the fund's focus on highway investment and safety by abandoning the many low priority and non-transportation diversions that now encumber the federal program. The soon-to-be-empty trust fund is a direct consequence of recent congressional overspending in excess of the fuel tax revenues that replenish the fund as well as decades of congressional mandates allowing non-highway interests access to the highway trust fund. In FY 2008, these mandates are estimated to have diverted approximately 38 percent of trust fund spending to projects and programs of little value to the motorist's mobility needs.

Not surprisingly the leaders of the House Committee on Transportation and Infrastructure want total spending raised from the current $286 billion to nearly a half a trillion dollars. The siphoning off of funds for "pork" to pass around is just too good for them to miss the chance to increase the take. To achieve this rate of funding (which always equals spending) would likely require a doubling of the federal fuel tax from its current level of 18.3 cents per gallon. Ain't that a pretty sight? In the midst of the highest fuel costs Americans have ever paid, our "leaders" want to increase the funding to a level that will doubles the tax on fuel.
The Chairman of the house committee on Transportation & Infrastructure is James L. Oberstar. You can't write to him though because he uses a web site that only allows residents of his congressional district to send him email. WTF is that!!?? This guy oversees one of the most critical congressional committees in existence, affecting all Americans, and he only takes email from people living in his district? This guy sounds like a piece of work. He funds zero of his own campaign expenses, 56% of which comes from PACs. At $1.48M he raised approximately 40% more in campaign funds then the average congressman in the 2007-2008 campaign period.[source: Federal Election Commission]. By the way, it turns out that most members of congress restrict email reception to those from residents of their congressional districts. However, you can write snail mail. Here is a list of the committee members. A quick google on any name will yield an office address. Write to them and tell them to stick it. You'll feel better.. a little.

Special Note to my always supportive Veronica: I am going to have a big rum drink and get lost in a movie. I will relax. In fact, I've forgotten the above referenced rotten, dirtbag, sunzabeaches already...kinda.


Wordprefect said...

Too bad I just can't tear up my mortgage and send that to them. I didn't choose that bank by the way. Our mortgage was sold to them. Oh well, at least I've got a home now.

Anonymous said...

Raising the tax on fuel might seem to be an onerous burden to "fix" the outdated and collapsing highway system, yet how else would you propose to raise the money? Limiting spending just won't hack it as the deterioration of the system requires a gigantic overhaul.

Sure we could make the Federal Highway Budget immune to draining off to other needs but it wouldn't be long until a way around it was found.

I don't remember the specific numbers but something more than 50% of the Interstate bridges in New England are in dire need of repair. We are staring another major collapse, such as in the Twin Cities area, right in the face.

Americans have long enjoyed the 'minor' taxes on fuel when compared to most other industrialized nations.

Nothing ever happens until after the fact of a catastrophe. Yes, pork will remain a problem no matter who is in charge but usually that pork at least fixes the ills (at least in highway projects) in some fashion. Maybe we need another cabinet post. KING OF PORK would weed out the truly garbage stuff and distribute the pork in more reasonable ways.

Sadly we are bound to continue on a path of denial when it comes to infrastructure. We will learn when all of Asia and the Middle East have infrastructure that is far superior to the US. Then you'll hear the moaning and see the hand wringing about why are we so far behind.

Raising fuel taxes by a factor of 3 would accomplish a couple of things:

force a real thrust in developing new energy sources (remember JFK's commitment to going to the moon?);

Getting older gas guzzlers off the highways;

Provide real impetus to getting true mass transit systems in place;

AND fixing the highways.

The old adage of "The squeaky wheel gets the grease!" would drive all of the above. Yep, it would be painful but nothing ever gets done without some pain.

El Gibbon

"Simplifried" said...

Thanks for your comments. There is nothing in them I could disagree with. Actually my rant was about congress tacking on "mandates" that burden the highway trust fund with non-highway development. Just another way for congress to slip in a little "pork" here and there. To the tune of "In FY 2008, these mandates are estimated to have diverted approximately 38 percent of trust fund spending to projects and programs of little value to the motorist's mobility needs"

I don't see how we are going to avoid a raise in taxes. If McCain is elected I don't see how we are going to prevent that burden from falling to the already beleagured middle class. Yet both he and Obama's programs claim their plans will ease the tax burden on the middle class.

Like you I think America's infrastructure is in extremis. It deserves priority treatment. Sticking to the original intention of the highway trust fund would be a good start. Raising taxes is also something the candidates should be honest about. However, with each day bringing succesively worse economic news I am beginning to wonder what tax base will be left.