Remember late in September, Congress had to pass a $700 billion dollar rescue plan to keep our economy from financial ruin? Well, that emergency plan eventually passed on Oct. 2nd. It grew from its original 3 pages to 450 pages. It also grew in scope: no longer was it a $700 billion blank check, it now included lots of pork!  

In the month and a half since passage, the stock market continues to head downward. More companies, states, and cities are lining up with their hands extended for bailout cash. Every week it seems the bailout bill morphs into something other than its original purpose: (My emphasis throughout.)

Originally intended as a program to largely mop up bad debt related to the home mortgage crisis, Paulson last week redefined the program so that it focuses more direct capital injections into banks and consumer-related debt.

Watching Treasury Secretary Hank Paulson Explain[s] the Financial Crisis is not at all reassuring. (The following are some excerpts, not word for word, but pretty close to what was said. Time stamp notes that section.)

Paul Gigot asks: What can you tell taxpayers they have received for their $700 billion?

What I can tell taxpayers is that the financial system has been stabilized. We never promised that this rescue package would solve all the ills of the economy or that the govt. could push a button. ...it was passed on Oct. 2nd ...by 10 days later we had $115 billion out the door to those banks. ...the system is stabilized...

5:00 You will make an adjustment in your rescue plan to no longer buy those troubled bank assets.Those toxic assets on the balance sheets are still a problem, aren't they? 

They sure are and this was a good idea when we conceived the plan, and it is still a good idea...

By the time Congress passed the law, it was pretty clear that the situation was more severe...the best way to use these funds is to focus on capital and so we announced... to hold back more funds so they would be available for capital.

6:50 ...some of those $700 billion into consumer finance areas like, auto loans, student loans, and credit cards.

This isn't a firm proposal. In our economy 40% of consumer lending takes place outside of banking industry.
...The concept here is a federal reserve liquid pool.

[8:38 Paulson gives the example of an investor coming to the Fed. with a AAA rated student loan paper ...]

11:00 That is not the intent, it is not to be all things to all people. It is to deal with the financial situation. Perhaps that Department of Energy bill passed by congress of $25bil for auto industry, perhaps that could be modified to help.

11:32 How long is the govt. going to be a share holder in a lot of these institutions and the danger of politically directed credit. As you look at this into the next presidency, how long do you think the government should try to keep a stake in these things? 1 year, 5 years, 10, forever?

11: 50 Certainly not forever. No longer than is necessary. We've structured this program to be not obtrusive. We've structured it to not crowd out private capital. We've taken preferred shares and the warrants in common wont be voted...and hired asset managers. This is about getting capital into banks, to help the US economy and stabilize the system.  This is anything but a program to come in and nationalize or have the government be there for a longer term.  It is very different from other programs you've seen described  that have taken place in other countries around the world and some of the programs designed in Europe.

I don't know about you, but I don't feel all that assured that Paulson even knows what this bailout is supposed to be. Do I trust him that these bailouts aren't nationalizing our banks and other industries? Remember How Paulson forced bail-out on the banks?

...US Treasury Secretary Hank Paulson strong-armed America's big banks into signing up for the bail-out plan.

... Why was this necessary? he [Wells Fargo's Kovacevich] asked. Why did the government need to buy stakes in these banks?

Paulson, who yesterday made clear his own distaste for the bail-out plan, told the Wells Fargo chief and his fellow bank bosses that it was for their own good, and the good of the country

So who decides where the money is used, the Congress or Paulson? The bailout bill congress wrote and approved gave Paulson control of the project*. So why is the Congress discussing auto bailouts for the $700 billion if Paulson isn't in favor? 

One thing that is clear: Secretary of the Treasury Paulson is a very powerful man right now, and it seems he thinks he is king. And why wouldn't he?

We are venturing into uncharted waters right now, hang on mates, there be rough waters ahead.

*It is much the same when voters last spring gave Elmbrook $62.5 million for the referendum. We approved it, the board decides how the money is to be used. 

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Elmbrook enrollment down by 103 students, but no need to worry...now. "The state exempts districts from fluctuations in enrollment for one year."

I first learned about this delay at the April 8th school board meeting when they discussed the 2008-09 budget. There was mention that although the 4K pilot program was discontinued, Elmbrook's budget would still be based on their higher 2007-08 enrollment numbers*. It was a boon--a bit of free money.

In other words 2008-09's budget included about $165,000 in extra state aid money, because the state based their funding on approximately 196 4K kindergarten students no longer enrolled in school. (Kindergarten students count as half a student in the state aid formula since they attend half day.) This money was free in the sense that there were not teacher expenses associated with it, because the 4K program no longer existed.

If memory serves me correctly, Board member Glen Allgaier asked if that extra money should be used to offset the coming budget shortfalls. That idea was quickly dismissed. (Thanks, Glen, for trying.) 

Anyway, this year, Elmbrook School District shows a 103 student enrollment decline since last year (97 resident, 5 non-resident) not counting the 196 4K students.

This came as no surprise though to the administration. The trend toward declining enrollment was "projected:"

Superintendent Matt Gibson said the decrease was on track with projections. He believes a decrease in the birth rate and slowdown in the housing market have contributed to the decrease in students.

Next year, though, the drop will be included in a three-year rolling average that is used to calculate funding for the district. This average figures into Elmbrook’s total revenue cap, the amount it is allowed to collect in aid and taxes.

As such, a drop in enrollment can mean less state aid and higher taxes to make up the difference.

Parents who homeschool or send their children to private schools often send their children to public school in the higher grades. But even at the high school level enrollment dropped by 57 students.

Voters just approved a $62 million dollar high school referendum last spring to expand and improve facilities. Guess we needed that extra room to accommodate those 57 fewer students?

Speaking of the referendum, remember how our additional yearly tax contribution was calculated on a 2% increase in tax base? That 2% has fizzled too.

No need for Elmbrook’s administration to worry though. All budget shortfalls, whether caused by an increase in referendum expenses or declining enrollment will be made up by us, the Elmbrook taxpayers.

*I had not thought about this before: If Elmbrook can collect state aid for students no longer enrolled (because of that enrollment fluctuation delay) does this mean Elmbrook calculates their tax levy on us based on students no longer enrolled too? Remember, Elmbrook taxpayers pay about $10,000 per student / per year for each resident student. I must ask about that!    

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I first heard about the U.S. Chamber of Commerce ads on Mark Levin's Friday, Oct. 24th broadcast. (About at the 40 minute mark.) Mark also discussed socialism and floated the possibility that Obama somehow considers his spreading the wealth as reparations.

Mark characterized the business community as being "officially horrified" at the prospect of being under a Democrat majority House, Senate, and presidency. From the Wall Street Journal, Business Finally Fights Back The U.S. Chamber of Commerce throws its weight against a filibuster-proof Senate: (My emphasis)

Ten days to election, and they are pouring millions into ads, canvassing neighborhoods, making calls, getting out the vote, enraging Democrats -- all in an effort to turn around a dire political situation. The Republican National Committee? No. The U.S. Chamber of Commerce.

The business community is back in politics. After years of contented political gridlock, American companies are now officially horrified at what an all-Democratic Washington intends to inflict on the U.S. economy. The Chamber is throwing its extensive resources at denying the left a filibuster-proof Senate. In doing so, it has stuck its finger in the Democratic leadership's beehive, and is facing retribution.

It says something about the momentousness of this race that the Chamber doesn't care. While the trade group has always been a force, over this decade many businesses have inched back from in-your-face politics. They felt comfortable with Republicans in charge. They felt comfortable with Democrats running Congress, since divided government rarely brings change. They felt comfortable not offending either political party, and not inviting attack by liberal activists.

They do not feel comfortable now. The Democratic Party once respected the need for a healthy U.S. business community. That was in part because business was ferocious enough to demand respect. But a resurgent labor movement has asserted control over the party. And business has been more concerned with PR than principle. This, and the recent financial crisis, has emboldened Democrats to pursue a pure antimarket agenda.

Their "card check" legislation means thuggish unionism. Their tax policies would squelch American capital. They'll reverse tort reform. Their antidote for today's financial mess is a super-Sarbanes-Oxley. Trade? What's that? Energy? What's that? Henry Waxman will start so many witch hunts, he'll need a lottery to see who goes first...

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Brookfield7, Fairly Conservative, Betterbrookfield, Jay Weber, Mark Levin,  Vicki Mckenna

Joe the plumber sure put a face on the problem with taxing small businessmen and giving it to workers paying little or no Federal income tax at all.

Now we learn that Joe isn't Joe, he isn't a licensed plumber*, and in actuality, is not in such a high tax bracket**.

This Joe's real name is Samuel Joseph Wurzelbacher. But whether he goes by Sam or Joe, there are plenty of small businessmen in the same very real tax situation that Joe asked Obama about.

Joe may not exactly be the "Joe the Plumber" we thought he was, but Barack Obama's tax give away answer is very real and sincerely believes in the ideology of spreading the wealth around.

If it were not for "Joe" would Americans have heard from Obama's own lips that, (My emphasis)

"It's not that I want to punish your success. I just want to make sure that everybody that is behind you, that they have a chance for success, too. I think that when you spread the wealth around, it's good for everybody."

There isn't anything really new about Obama's "spread the wealth around" message. It just never got much national coverage. Real Clear Markets spelled it out well back in February:

The Obama spend-o-meter is now up around $800 billion. And tax hikes on the rich won't pay for it. It's the middle class that will ultimately shoulder this fiscal burden in terms of higher taxes and lower growth....

Obama would like voters to believe that he's the second coming of JFK. But with his unbelievable spending and new-government-agency proposals, he's looking more like Jimmy Carter. His is a "Grow the Government Bureaucracy Plan," and it's totally at odds with investment and business.

Obama says he wants U.S. corporations to stop "shipping jobs overseas" and bring their cash back home. But if he really wanted U.S. companies to keep more of their profits in the states, he'd be calling for a reduction in the corporate tax rate. Why isn't he demanding an end to the double-taxation of corporate earnings? It's simple: He wants higher taxes, too.

The Wall Street Journal's Steve Moore has done the math on Obama's tax plan. He says it will add up to a 39.6% personal income tax, a 52.2% combined income and payroll tax, a 28% capital-gains tax, a 39.6% dividends tax and a 55% estate tax.

Not only is Obama the big-spending candidate, he's also the very-high-tax candidate. And what he wants to tax is capital.

...

Obama believes he can use government, and not free markets, to drive the economy. But on taxes, trade and regulation, Obama's program is anti-growth. A President Obama would steer us in the social-market direction of Western Europe, which has produced only stagnant economies down through the years.

Joe certainly got his minutes of fame. He was on the Mike Huckabee show and greeted like a hero.  It took Joe the Plumber to put a face on the problem and bring it to the forefront. Why haven't we been talking more about this before?

Thank you, Joe. Sorry your life has become an open book.

*Many people in the trades do not have an actual license themselves but work under the license of an owner or boss.

** " Wurzelbacher never claimed to be making $250,000 a year. He told Obama that he might be 'getting ready to buy a company that makes about $250,000, $270,000' a year. His simple point was that Obama's punitive tax proposals would make it more difficult to realize his dream."

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The Senate bailout plan passed Tuesday night. The bill went from the 113 page house version to 450-something pages! How could the Senators even read 450 pages?

This travesty of a bailout bill epitomizes everything wrong with Washington: Dire problem...Don't fix problem...Load on the pork...Make problem worse.

What is in there? I heard some tax breaks. The oddest was for children's wooden arrow manufacturers. I call that the good part because at least it probably does not amount to much money.

This bill is probably everything Congressman Paul Ryan feared. Certainly the Senate version did not get that month long, or even a week long committee meeting process that Congressman Jim Sensenbrenner wanted. Instead they rushed this pig through.

Michelle Malkin posted 3 pieces Tuesday: Kill the baliout: The vote draws near, and The Senate votes, and Read the Senate bailout bill here, which included the bill's language. They give a flavor of the night and bill. Nays include: Brownback, Bunning, Dole, DeMint, Feingold, Inhofe, Johnson, Sanders, Sessions, Shelby, to name a few. The votes are recorded at end of Malkin's The Senate votes posting. (I will have to thank Feingold, which does not happen very often.)

Correction: Hold the phone, the following did not make it into the final bill: The bill included an amendment from Senator Sanders for a 10% income tax surcharge on incomes above $500,000, $1million for couples. That will hurt some small business owners.

It goes back to the House Thursday, with a vote possibly on Friday. If you are a praying person, pray the House would have wisdom.

The most important piece, the repeal of the Community Reinvestment Act I think is still sadly lacking. Without that piece of the pie, I think we are doomed to just keep repeating the cycle.

Seems that additional 340-some pages were pure lard.

Sickening. 

We have a model that worked pretty well when the government stepped in with the Savings and Loans. Why didn't they do that?  What about the Republican model of lending institutions purchasing insurance? Another possibility comes from frugal Dave Ramsey.

Post Script bright spot: "The bill also reaffirms the Securities and Exchange Commission's authority to suspend so-called mark-to-market accounting, an issue that gained surprising traction among lawmakers looking for less costly alternatives to the Bush plan. The practice, adopted in the aftermath of the savings-and-loan collapse in the 1980s, pegs the value of assets to their current market price, rather than the price paid for them.'

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I heard both Congressmen Paul Ryan and Jim Sensenbrenner interviewed on Jay Weber's radio show this morning. (Hour 4 Part 2). Since I trust the opinion of both of these men, I was curious as to why Ryan voted YES and Sensenbrenner NO on the latest bailout bill. 

First Congressman Ryan, who does have a degree in economics. The following are some notes I took from the interview--they are not direct quotes. Listen to the podcast if you can.

Ryan said the bill yesterday was the Paulson plan with quite a bit of tweaks.

The original Paulson bill was 3 pages: Give me a blank checkbook with $700billion.

We wrote a [Republican] alternative. Ours said, Let's make the firms buy insurance.

We rewrote the bill, added stock options--warrants to taxpayers, so the taxpayer is first in line to get money back (if there are profits--that means ACORN would not be getting funding as the orig. Paulson bill stated.) Executives won't get a Golden Parachute.

This bill was $350 billion: $250b immediately and $100b later. An additional $350b would need to be voted on in the future.  

Over the weekend, credit markets went crazy. The problem is not just on Wall Street. Credit markets are shutting down. [That means cash flow for payrolls is unavailable.] There is a fear of recession.

"I'm now sincerely worried this could lead to recession."

Jay Weber: Can we move slowly or do we need to move quickly?

Ryan: Tax money goes out the door either way, this way (bailout) or from FDIC (if banks fail.) Paulson mishandled this so badly.  We added 107 pages to his bill. 

I have never seen things like this [credit freezing up]--ever. Businesses won't be able to cash flow payrolls.

Weber: There is a deep distrust of Congress.

Ryan: 2,300 calls [to my office] almost all against the bailout. [That is changing a little now.] We have to corral Wall Street so it doesn't spill to Main Street.

Weber: Why aren't Republicans hammering this?

Ryan: I am. Since 2002 I have voted against Freddie and Fannie every time.

I think Paul Ryan voted for this measure because he is genuinely worried about our economy shutting down. He knows that if businesses cannot get credit to meet their payrolls, that means workers do not get paid. With many Americans just a paycheck away from being broke, we cannot afford to let that happen. Businesses also use credit to purchase supplies and equipment for future production.

Then it was Congressman Jim Sensenbrenner's turn:

Paulson [Barney Frank] plan fatally flawed from the beginning. That money all came from taxpayers.

The word was, $700billion would not be enough.

America can't afford this. We are wealthy, but there is a limit. 

All of this is inflationary. Interest rates will shoot up. [Remember] 20% prime rates during Carter? 

We should go back to the regular order [of crafting legislation] with committee meetings, rather than Paulson saying we have to do this.

Weber: We're racing against the clock.

Sensenbrenner: When markets opened [today] they were up 200, so hopefully the markets have calmed down.

Paulson is pushing for now. It bailed out the people who caused the problem.

I'm prepared to go back when Pelosi calls us back.

This is a case of Congress serving the people. 

Weber: What angers people is Frank and Dodd in charge of the fix. Is there any mechanism to say when you failed the people, get off the committee!

Sensenbrenner: The Community Reinvestment Act was a significant factor [to what is going on.] 

The process worked yesterday. The speeches like from Pelosi need to stop. She also knew there were not the votes to pass. Why did she bring the bill to the floor? [To fix blame on the Republicans]

Weber: Would you change the Community Reinvestment Act?

Sensenbrenner: Repeal of that law should be in the new package now.

The Security and Exchange Commission dropped the ball--enforcement was not vigorous. 

The Justice Department should investigate if any fraud was committed. [Imprisonment would serve as a deterrent.]

So there you have the Yea and the Nay. Where is Solomon when you need him? 

Conservatives would hope the next version of the bailout bill would be better for taxpayers, that it keeps money from ACORN and repeals the Community Reinvestment Act. With this crew I don't have much hope.

My fear is that the next version will included ACORN funding again or worse. The Democrats will vote for it, and President Bush, who is really over a barrel here, will have to sign it.

Calls from Americans running 500 against, to 1 in favor, of the bailout might be the only thing that saving us from an UGLY pig of a bill.

Post Script: Along the lines of Sensenbrenner's request that they craft this bill carefully, 165 Economists rip bailout plan:

The economists say they are well aware of the current financial situation and agree there's a need for bold action but ask Congress "not to rush."

They urge lawmakers to hold appropriate hearings and "to carefully consider the right course of action." 

Right now the market is up 307 points from yesterday's close. You can check anytime on USAToday. (If you leave it open, it automatically refreshes.) 

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Our present market woes and the Freddie/Fannie mess did not come out of nowhere. They are not George Bush's fault. They started a  l-o-n-g  time before either Bush.  Watching the house burn down: What caused our economic crisis? gives a good run down of the chain of events leading up to this crisis.

First thing this morning, I checked to see if Rep. Paul Ryan and Jim Sensenbrenner were on board with the bailout bill. If so, then I felt it might shore up the market with the least harm. Thankfully, ACORN funding has been removed from the present version.

Rep. Paul Ryan doesn't like the bail out but agrees we are painted into a corner and must do something. Jim Sensenbrenner it seems will not support it at all. GOPUSA says it is still a Train Wreck.

The House Bailout failed to pass 228-205. Seems Pelosi gave a pre-vote speech that did not warm the hearts of Republicans by blaming Bush for all of this. Democrats were not enthusiastic either. Democrats against: 95, Republican NOs: 133. Wisconsin Representatives voting NO: Jim Sensenbrenner - R, Tom Petri - R, and Steve Kagen - D.

Roughly 4/5ths of Americans do not favor a bailout, which is why democrats were hesitant to sign on. Some want the free market work as in Citibank buying Wachovia today.

The market closed at 777 points down today. The price of oil went down to $96/barrel, gold closed up about $8 at $898/oz. One thing saving our bacon is that world wide markets are jittery too. If you are a foreign investor, who do you trust with your money? Don't know how long foreign investors will stay with us though.

I have no idea what is the right thing to do regarding the bailout bill. I think Ryan voted for because he knows this could go way south.

At the very least, it is time to put an end to no money down and little money down mortgages!

Vicki McKenna talked today on her radio show about how she* is in the process of buying a home. When she first started looking months ago, she was told she needed 20% down. This is consistent with what a Realtor friend told me--that people were getting mortgages if they had 21% to put down. But now Vicki was told she could get a mortgage for 3% down, if she did it before the end of the year!

I believe the little or no money down policy of the Community Reinvestment Act started us down this fiscally irresponsible path. Without the cushion of 20% down, for those times when home values falter, these no/little money down loans became upside down.

So the American taxpayer is asked to bailout out the lenders, and Congress is drilling more holes in the boat by not reforming down payment requirements? Pretty typical.

PS Did you see that the House passed a $25 billion bailout for automakers?

*CORRECTION: It was not Vicki herself, but someone in her building. The point remains the same regardless who got the loan. 

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There is lots of chatter today about how Sen. John McCain squashed the soon-to-pass bail out plan. (So much for the Dems. calling him Bush 3)**

Hmm, the Democrats are in the majority, why don't they just pass it on their own?*

Because they don't have the votes in their own party.

Truth is, the bail out bill the media said was near passing, was NOT anywhere near approval. House Republicans were not consulted on the Paulson bail out bill.

In addition, Senator Lindsey Graham was on Fox last night and explained that part of the bail out money would go to ACORN! From Hot Air:

House Republicans refused to support the Henry Paulson/Chris Dodd compromise bailout plan yesterday afternoon, even after the New York Times reported that Treasury Secretary Henry Paulson got down on one knee to beg Nancy Pelosi to compromise.  One of the sticking points, as Senator Lindsey Graham explained later, wasn’t a lack of begging but a poison pill that would push 20% of all profits from the bailout into the Housing Trust Fund — a boondoggle that Democrats in Congress has used to fund political-action groups like ACORN and the National Council of La Raza

Would you want that to pass? 

Most Americans are not in favor of a bail out. Most Republicans do not favor a bail out. Newt Gingrich has not favored a bail out to save our economy. (Emphasis mine) 

Newt Gingrich:  Well, the last time we were promised they were going to save us, it was $300 billion; it was a housing bill.  And what liberal Democrats in Congress did, for example, was add $500 million a year for a left-wing activist group called Acorn.  Now, I can’t imagine why we’d want the taxpayer to give $500 million a year to a left-wing activist group, but it’s in the bill which the Bush administration signed and that was only back in July and that was going to solve everything.  That was $300 billion ago.

Now we have a brand-new, liberal Democrats, many of whom, for example, Chris Dodd, was the largest single recipient of money from Fannie Mae and Freddie Mac and he is the chairman of the Banking Committee.  So the guy who got the most money is now going to write a bill to give taxpayers money to the people who gave him money.  Somehow, I am not reassured.

The House GOP (Republicans) have presented a plan of their own. It is more of a Work Out than Bail Out. Gingrich also favors a Work Out that would include borrowing at 2% not bailing.

I may just be a Home Economist, but I know we need to do something. If the average American was in better financial shape, not carrying around $8,000 debt on their credit card and not one paycheck away from financial disaster, I might be inclined to just tough it out.  

Gingrich recommended that Republican leaders like Boehner, DeMint, Shelby, and McCain meet to put together a proposal Americans will support. Then the people will put the pressure on the Democrats in Congress to pass it, much like public pressured Congress to drill for domestic oil. But since Harry Reid just stuck a ban on domestic oil shale drilling onto an appropriations bill, while this crisis is going on, so much for listening to the will of the people and doing what this country needs.

Heaven help us. I mean that literally.

Read more: Market Rescue Dos and Don'ts  from the Heritage Foundation

*Observation courtesy of Nick Reed interjecting on the Jay Weber show this morning. 

**Observation by a caller on Rush's show today. (The car radio does make running errands more tolerable!) 

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The Democrats present the Trojan Drilling Bill, the stock market is in major jitters, investors look for safe places to put their money. Hence oil, gold/silver/precious metals go up. Pretty simple.

With the Democrat's no-drill oil bill, prohibiting drilling in most areas, there will be little change in our domestic oil supply. If we don't get a real Drill Here bill, we will be dependent on foreign oil for years and paying higher prices. It is supply and demand...the price will go up.

Anyone wondering if the Democrats are trying to create such an oil price crisis that the government must come in and take that industry over too? I am hard pressed to explain the Democrat's stance any other way.

The other factor involved in precious metal and oil price increases is the fall of the dollar. It had been improving since about July. But the Freddie and Fannie / financials bail outs cause the United States to expand the money supply. That is inflationary, resulting in the value of the individual dollar to fall. Again, it is supply and demand.

From the Financial Times: The Short View: Oil and the Dollar: 

By late morning in New York on Monday, the price of oil had climbed by 20 per cent in barely five days and scarcely anyone had noticed. Then it went into overdrive, hitting $130 at one point before settling at $120.92. Last Tuesday, it traded at $90.51 – a swing of 44 per cent from bottom to top.

This had little to do with the supply of and demand for oil and everything to do with the fallout from the “Paulson plan” – the proposal to risk $700bn of US public money in a bail-out of toxic securities held by banks.

Oil rose as doubts surfaced about the plan.

When people are nervous, they look for tangible products to invest in. 

A key variable is the dollar. So far, it has fallen in response to the possible huge rise in the US deficit. The markets seem to have gone a step further and assumed that this step will be be inflationary and cause financial assets to lose value.

In that situation, the thing to do was to head for real assets, led by oil, although other commodities, led by silver, also had a strong day. Unfortunately for the Paulson plan, the inverse relationship between oil and the dollar is one of the few financial constants to have survived the past few days.

I heard this morning that oil settled down to about $108/barrel in Asia. People are nervous worldwide. The US money supply is expanded beyond thin.

The last thing we need is another check writing spree by the government in the form of a Democrat 2nd $50billion stimulus package or a $1,000 energy rebate based on a windfall profit tax to oil companies as Obama is touting. (That tax would be passed onto consumers, making oil prices higher.)

Even the Federal Government can only print so much money if it is to be worth more than the paper it is printed on! 

Brookfield District 7 Info meeting, Wed., Sept. 24, 2-3pm or 6:30-7:30pm City Clerk Kris Schmidt will be in attendance to answer questions or concerns regarding recent news about the Van Hollen lawsuit against the state elections authority.

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Sunday we returned from a few days in Dearborn Michigan touring the Henry Ford Museum, Greenfield Village, and The Rouge Ford Factory. The Rouge Factory Tour was new to us. There was Bill Ford, the great grandson of Henry, up on the BIG screen telling us how Ford created this new Rouge factory to be friendly to the environment.

Much like our proposed Fountain Brook Crossing, The Rouge Ford Factory* has Gone Green. The roof is a garden roof, planted with sedum plants to absorb the rain water. They are increasing plantings wherever possible on the grounds; nets are strung up on the factory exterior for climbing vines.

Even their parking lots are water permeable. No more run-off. The paving material looks like asphalt but is a porous material that has sand and gravel below. The guide said that the water that runs through the pavement is filtered and very clean. It requires vacuuming twice a year to keep pores open and calcium chloride must be used instead of sodium chloride in winter.  The porous pavement is more expensive to install and maintain but lasts twice as long as conventional asphalt. Plus, no detention pond is needed...and it's good for the environment.

It seemed everything about The Rouge Factory was good for the environment or good for the employees. You could watch some of the assembly line in action. The workers were poetry in motion each doing their specific little jobs. While they are always under the time constraint of the moving line, it did not seem any were really hustling to keep up the pace. Some workers were on the cell phone, playing a hand held game, or even had newspapers there to catch a snippet of an article.

I asked a tour guide how much money these people made. She did not know specifically but said from what she read in the paper, it was around $20.00 per hour for new hires. Workers with more seniority were higher.

Another guide told us that Ford recently closed 2 other factories in other states, I believe, and now consolidated all of the work here at The Rouge. That sounded efficient. The Rouge's specialty was trucks**. Wonder where the other cars are made?

Monday's Investor's Business Daily answered part of that question: Movin' To Mexico!:  (My emphasis)

Ford's investment of $3 billion in two auto plants near Mexico City is the largest foreign company investment ever in Mexico. As oil prices soar and new climate-change rules are readied in Washington, Ford must shift from its reliance on trucks and SUVs to lighter, more energy-efficient vehicles.

This should be something that workers in Michigan and other Midwestern states with decades of automaking experience should excel at doing. Instead, Ford and other automakers are pushing more and more investment abroad — especially to Mexico.

The editorial cites reasons for an auto sales slump and the US losing jobs--mainly the UAW forcing higher wages and benefits--but increasing climate change rules and higher oil prices aren't helping the industry.

Like a coyote caught in a trap, U.S. automakers have been desperately gnawing off a leg to escape certain death. They're closing plants and slashing jobs in Michigan, Ohio and other U.S. union havens, in favor of non-union, foreign places. Like Mexico and China.

Meanwhile, foreign companies have no problem making cars here. They do it in the non-union South, where the UAW is weak.

So foreign companies can get around our high wages by being non-union, but even they and their products are subject to U.S. emission standards for factories and cars.

You would think that with our ailing auto industry our government would be doing all it could to help encourage instead of hinder. Yet Washington continues to hamper oil exploration and increase auto emission standards (i.e. new diesel emissions will be cleaner than intake air.) 

Add to automakers woes, both U.S. and foreign made here, the latest millstone around the neck: Cap-and-Trade, and I think we have the recipe for outsourcing more industry of all kinds.

Ford may have greened up its Dearborn plant and created an ideal work environment, but if more industry follows suit in exporting jobs to countries that don't care about workers or the environment, what good paying jobs will be left in America?

This was written before Tuesday's post Kohl, Feingold, and Doyle's reaction to GM closing Janesville plant

Related articles: Toyota workers in Kentucky plant made more than UAW members last year

More handwriting on the wall, GM closing Janesville assembly plant by 2010 

*The Rouge Factory was named for the Rouge River in Dearborn. The banks of the river were red clay, hence the name Rouge (French for red). 

**A guide told us this was the last year they would be making Mercury trucks. 

Links:

Last night I heard Senator Inhofe (R-Oklahoma) on the Mark Levin Show.  They were discussing S. 2191, the Senate "Lieberman/Warner Global Warming Bill and the disastrous effect this would have not on just the country as a whole, but the individual." (My emphasis throughout post.)

Wall Street Journal referred to Cap-and-Trade as Cap and Spend

As the Senate opens debate on its mammoth carbon regulation program this week, the phrase of the hour is "cap and trade." This sounds innocuous enough. But anyone who looks at the legislative details will quickly see that a better description is cap and spend. This is easily the largest income redistribution scheme since the income tax.

The Washington Post said, Just Call It "Cap-and-Tax" 

"...One of the bad ways [to control greenhouse gas] is cap-and-trade. Unfortunately, it's the darling of environmental groups and their political allies.

The chief political virtue of cap-and-trade -- a complex scheme to reduce greenhouse gases -- is its complexity. This allows its environmental supporters to shape public perceptions in essentially deceptive ways. Cap-and-trade would act as a tax, but it's not described as a tax. It would regulate economic activity, but it's promoted as a "free market" mechanism. Finally, it would trigger a tidal wave of influence-peddling, as lobbyists scrambled to exploit the system for different industries and localities. This would undermine whatever abstract advantages the system has.

...Call this "environmental pork," and it would just be a start. The program's potential to confer subsidies and preferential treatment would stimulate a lobbying frenzy. Think of today's farm programs -- and multiply by 10.

After listening to Senator Inhofe, I think we could also refer to it as Cap-and-Raid! If it passes, it will raid every worker in America's wallet!

Senator Inhofe said, Senator Barbara Boxer insists this is not a tax bill. But if you have looked into the bill itself and at the linked articles, it is difficult to understand how this could not be considered a tax bill.

Inhofe then quickly listed some points to ponder. He mentioned the Wall Street Journal referring to it as the most extensive reorganization since the 1930s. He called it worse than the Kyoto Treaty for the economy. Cap-and-Trade will need 45 more Big Government Bureaucracies to enforce the standards.

Using Boxer's figures, Inhofe pointed out that Cap-and-Trade would collect $6.7 Trillion dollars from industry (those costs will be passed onto us!). The maximum rebate to customers is $2.5 Trillion dollars. Do the math: That means $4.2 Trillion goes where?

That sounds like a tax to me!

He went on to remind us that the Democrats have killed every domestic drilling bill. The US relies on coal for 53% of all of its electricity production. Cap-and-Trade will tax coal fired electricity production. Consider that China "cranks out a new coal electric plant" every 3 days (?). (I think he said 3 days, which fits with this - certainly between India and China it would be true.)

Manufacturing jobs will go where there is (cheap) energy/power, Inhofe said. This is also what Congressman Sensenbrenner talked about at his Town Hall Meeting when he called Cap-and-Trade "Catastrophic for Wisconsin". I would add that manufacturing jobs will also go where environmental regulations are more lax.

Senator Inhofe suggested people take a look at Liberman-Warner Opposition Resource Center; Impacts of Costly Climate Bill Exposed  It is chock full of quotes, links and articles.

The Senate is debating this bill this week. While some say the bill will not pass, as you know, once the foot is in the door, the issue will not go away.  Considering all 3 Presidential candidates support the concept of Global Warming, I would just say, the bill probably won't pass...yet.

Our Senators' response to my emails: Not much hope of a NO vote here--unless they feel the heat from constituents.

This is important! Please contact them both: Senator Kohl (Phone: (414) 297-4451, (202) 224-5653) and Senator  Feingold (Office of Senator Russ Feingold | 202/224-5323) and let them know what you think about this bill.

More reading:

George Will's Cap-And-Trade: A Devious Tax Plan

Good chart of key players and terms explained at end: Senate taking up key climate-change bill 

The Heritage Foundation's Morning Bell: Carbon Capping in Bizarro World 

Links:

If you've ever planned a road trip, mapping your route ahead of time makes a big difference: which way will allow you to travel with the least amount of traffic, major city rush hours, or road construction? Often a little planning ahead can save hours being stuck in a traffic jam. Certainly there is no sense to chart a course leading to a bridge closed for repairs. No reasonable person would say, the only bridge ahead is closed, but we'll make such good time before the bridge, we'll pick that route anyway.

Yet this is what our government is doing by ignoring the coming Social Security/Medicare crisis. Politicians don't want to deal with that reality. They know it is going bankrupt, but their attitude is, we'll cross that bridge when we come to it. "There is a growing, bipartisan consensus about the greatest threat to our nation's long-term economic prosperity: the explosion of entitlement spending." (Ryan)

Last week, Congressman Paul Ryan proposed his "Roadmap for America"--a very practical and pretty painless way to shore up Social Security, Medicare, and the tax code. Ryan is planning the future path for America that allows us to make good time and still cross that bridge in the future, and he does it without massive tax increases. He said in an interview:

I am raising the same rate of tax revenue as today, but I am preventing them from doubling in the future. I am proposing to tax 18.5 cents out of every dollar to run the government as opposed to 40 cents out of every dollar. Spend the money more intelligently. The 1st $39,000 (after deductions) for family of 4 is tax free. After that, the first $100,000 is taxed at 10%.

Ryan also bravely addresses Health Insurance and Medicaid in addition to Social Security, Medicare, and Tax Reform. Simply ignoring these pending problems will not make them go away. Ignoring these entitlements just increases the problems and costs. Hopefully Ryan's route will Not be A Road Less Traveled:

There is no threat to our nation’s fiscal health greater than the coming deficits from unrestrained growth in Social Security, Medicare, and Medicaid. Already Social Security and Medicare consume 7.5% of our GDP. Unless changes are made that figure will jump to 13% by 2030.

Bravely stepping in to offer a policy solution, Rep. Paul Ryan (R-WI) has introduced a plan he calls “A Roadmap for America’s Future.” 

Read through Congressman Paul Ryan's plan in the Wall Street Journal: How to Tackle the Entitlement Crisis for Health Insurance, Medicaid and Medicare, Social Security, and Tax Reform.

We cannot afford to ignore this any longer. Our children are the ones who will pay for our failure to deal with these growing problems. Ryan writes:

According to the Congressional Budget Office, Social Security, Medicare, Medicaid and the rest of government will consume nearly 40% of the economy by the time my [Paul's] three young children reach my age (38). This will require more than doubling the average tax burden of the past 40 years just to keep the government afloat. Continuing down this path will eventually strangle our economy.

Once we come to that "bridge", there is no easy way to cross it. The time to deal with it is NOW! The question is: Do we have any politicians brave enough to do the right thing?

Congressman Paul Ryan is a member of the Congressional Budget Committee and the Ways and Means Committee.

Don't forget the Music Concert to Benefit Chinese Quake Victims, Saturday, May 31st, 10AM - 1PM, Brookfield Civic Plaza

Links:

Congressman Sensenbrenner brought up Senate bill S. 2191, the Lieberman/Warner "America's Climate Security Act of 2007" at his Town Hall meeting Sunday. He described it as a "disaster for Wisconsin."

Information on S. 2191 from Congressman Sensenbrenner's website:

“S. 2191 proposes a nationwide cap-and-trade program for the emissions of greenhouse gases, like carbon dioxide, an important component of the manufacturing industry.  By setting a limit and capping carbon dioxide emissions by businesses, the Lieberman/Warner bill would thrust a highly regulatory regime on our nation’s economy, making electricity more expensive for businesses and consumers.  In Wisconsin, which relies heavily on the use of coal for electricity, this bill would have a catastrophic effect as we would be especially hard hit.

“This point is underscored in a study commissioned by the National Association of Manufacturers to assess the potential impacts of S. 2191 on Wisconsin’s economy…and the results are scary.

The Congressman discussed that study at the meeting and on Charlie Sykes show. The predictions were "scary."

“According to the study, electricity rates in Wisconsin could increase by as much as 163% in 2030 - nearly tripling today’s costs - and gas prices could increase by as much as 176% in 2030, again, almost tripling today’s cost of natural gas.

Not only will we be paying more for utilities, a figure of a 145% increase in gasoline prices was also given on Charlie Sykes show Monday, April 28, Ready for $10 a gallon gas?

So not only do we get to pay for higher energy costs for our own use, but we will pay more for every item and service produced in Wisconsin too.  

Who would ever want to live in Wisconsin or locate their business here if that is the case?

The National Association of Manufacturers report estimated that by 2030, 74,000 jobs would leave Wisconsin and a whopping 4 million jobs would leave our nation, because businesses naturally seek the cheapest and easiest place to manufacture their products.

What exactly is a cap-and-trade and why does it have such a negative impact on Wisconsin? 

Cap-and-trade is another term for Carbon Credit (or indulgences). Congress or bureaucrats set a cap or maximum on greenhouse gases that can be emitted by a company--be it a corporation or a utility company. Companies that do not comply with the standard must then have to purchase carbon offsets from companies that do comply. It is like a type of stock market that deals in these special credits.

According to Congressman Sensenbrenner, since Wisconsin gets 2/3 of its electrical power from coal fired plants, but Illinois obtains 60% of its electric power from clean nuclear power plants that emit 0 CO2, we will have to purchase these carbon offsets from Illinois just to keep producing our needed electricity! Illinois in effect gets their energy costs subsidized by Wisconsin residents. Wisconsin ends up paying 176% more for our electricity. OUCH! (At present, only 20% of Wisconsin electric comes from nuclear plants.)

Think no one in their right mind would agree to a system like this? Think again. Europe has been doing this for nearly 3 years now. Europe's greenhouse gases continue to rise as do their electricity rates. It has done nothing to lower emissions according to a publication from Sensenbrenner's office. I believe Australia just signed on to a system of carbon credits too.

Since businesses will just relocate to third world countries to manufacture their goods, these carbon credits will do nothing to lower CO2 emissions worldwide. The pollution will just move to the far east.

The increase in costs due to cap-and-trade fees are estimated at $1,300 a year / household for Wisconsinites.

Please contact Senators Kohl (Phone: (414) 297-4451, (202) 224-5653) and Feingold (Office of Senator Russ Feingold | 202/224-5323) and let them know what you think about this bill. 

Representative Zipperer informed the Town Hall meeting atendees that the Wisconsin Assembly recently passed legislation that lifted the moratorium on nuclear power plants last session. The Senate however did not. He said they would try again next time. 

Contact your state representative and senator about the moratorium.

State Representative Leah Vukmir, Republican, 14th District
Rep.Vukmir@legis.wisconsin.gov  608-266-9180

Representative Rich Zipperer, Republican, 98th District
Rep.Zipperer@legis.wisconsin.gov  608-266-5120

Congressman Sensenbrenner's contact info:Email  Telephone: (262) 784-1111, (202) 225-5101  

Links: Upcoming events in Brookfield

4th Annual Weed Out, May 3rd, Mary Knoll Park

I attended Congressman Sensenbrenner's Town Hall Meeting Sunday. Attendance was light--maybe 2 dozen people (mostly men). Perhaps the early start time kept people away?

Wisconsin's Representative Rich Zipperer was also there to answer questions.

I missed the first question. The second dealt with Common Ground, a group that has been appealing to churches for support. Is it truly bi-partisan?

Both Congressman Sensenbrenner and Rep.Zipperer expressed their doubts of bi-partisanship since Common Ground did not seem to be interested in tax relief, school choice, etc.

A reader had emailed me about this group 2 weeks ago after Vicki McKenna talked about Common Ground on her radio show. The reader was "taken aback" that their St. John's church bulletin urged people to attend the Common Ground conference. Many people might be surprised to learn their church supports Common Ground.

Energy and taxes were the topic of the remaining questions.

One man inquired if the direct donation from retirees' IRAs to a charity option would be renewed (this would then satisfy the distribution requirement). Mr. Sensenbrenner said that there would be an effort to bring that donation option back since donations to charity support groups that often help others without any additional government funding.

The next question asked about the Congressman's opinion of nuclear power. He said he was "All for it--it emits 0 greenhouse gas." He added that Chernobyl's defective design for nuclear power plants has never been used in the U.S. There was more discussion about Wisconsin's rising energy costs, which the Congressman also discussed on Charlie Sykes show Monday morning. It is a subject all unto itself, so I will get to that in a later post.

The last question was on Ethanol. Mr. Sensenbrenner said it was "Bad stuff--not energy efficient, and the blend reduces gas mileage." He also mentioned that there is engine damage and increased pollution because of it, and the 51 ce