Drug Testing for Welfare recipents

Mooseman

Isengar Tussle
. In fact, he fired the HUD director for supposedly being a racist based on a clip from some presentation, although it later turned out she wasn't.
Actually, Obama didn't fire her, the HUD director fired her in a knee jerk reaction to the edited video and incomplete story about it.
But if you want to say that he hired that director and is responsible for his actions, then ok.
 

Spiderman

Administrator
Staff member
True, but from what I read in the Washington Post, the director did it at the behest of the administration, which later apologized to her (both the administration and the director, I believe).

So yes, in this instance, it's pretty much the same thing.

And actually, I think I misstated - it wasn't the HUD, but the SBA or whoever helps out farmers.
 
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EricBess

Guest
I think Obama was stuck between a rock and a hard place. He either let the banks and the insurance firms go under or bail them out (I assume that's what you're talking about - if not, please clarify). He had financial advisors telling him (probably) that either solution sucked, but the bailout was the "least" painful. What would have happened had he chose the former?
Clearly, things would have been different had there not been the economic problems starting before Obama was in office. The bailout itself is shrouded in scandal. The fact is, there would have been banks go under, but the overall stability of most banks turned out to be better than people were being led to believe. Was the actual bailout a necessary evil? Definitely there are people that feel that way and it was presented that way to the American public.

Personally, I think that the bailouts were a mistake. It would have been a financial disaster in many ways to let a bank or two fail, but sending a message that you can have greed unmitigated by risk is just setting up for an even larger disaster in the future.

But dispite all that, it's not the whole picture. Given that we are in financial hard times to begin with, unemployment already high, introducing a ton of changes and trying to push through huge legislative programs. Changing the political landscape for small business is always going to hurt short term as businesses try to adapt and figure out the new rules. Until that happens, don't expect them to staff up.

So I guess what I am saying that IMO, the bailouts were bad. But if it were just the bailouts, we would probably be over it by now. Instead we have health reform, pushing of cap and trade, economic reform, etc. Obama is trying to put through as much change as he can while he has a supportive congress and all that change is keeping us in tough economic times.
I'm not sure where THAT came from, but I don't believe I nor anyone has claimed that your opinion is based on personal dislike.
Sorry, I didn't mean to imply that anyone here was claiming racism. You have expressed, however, that all we are doing is pointing out the negatives of the administration.

I guess the frustration comes in that DF and I have expressed disapproval and given a number of reasons for the disapproval and reasons why we think that the programs that Obama keeps introducing are bad ideas. The counter argument seem to be "but you don't know".

I have yet to hear anyone give a good argument for why they think Obamacare won't just be another huge tax burden that will bring a reduction in the quality of healthcare that we enjoy. Instead, we get a Pelosi-style "we have to sign it to know what's in it" answer of "wait and see". My concern with that is that if you wait and see and we turn out to be correct, it will be too late to do anything about it.

Medicare, for example, has huge problems, but you can't even suggest taking it away because people have now become dependant upon it.
 

Spiderman

Administrator
Staff member
Clearly, things would have been different had there not been the economic problems starting before Obama was in office.
Well, yeah, but things would have been different no matter who was elected, Obama or Bush. Given that one of them would have to face the economic problems when they were elected, the question is: Would Bush have done anything differently? Honestly, I'm guessing no. But whatever he may or may not have done AND the results/consequences of such actions are probably exploring the realms of "impossible-to-know".

Personally, I think that the bailouts were a mistake. It would have been a financial disaster in many ways to let a bank or two fail, but sending a message that you can have greed unmitigated by risk is just setting up for an even larger disaster in the future.
If that's your conclusion from watching the bailout results, then I'm not sure you're seeing the whole picture. Yeah, it sucks to see those in the suits and at the top seemingly rewarded (although it happens all the time in "normal" times, execs getting golden parachutes during takeovers and such). But what if the banks failed? What happens to a) the "regular" employees and b) the assets of the bank, particular mortgages? There's probably more but those are the top two I can think of. With the bailout, people keep their jobs and thus DON'T add to the unemployment and people's homes are safe.

I have yet to hear anyone give a good argument for why they think Obamacare won't just be another huge tax burden that will bring a reduction in the quality of healthcare that we enjoy.
Question: Those who have it and enjoy or those that don't?

Instead, we get a Pelosi-style "we have to sign it to know what's in it" answer of "wait and see". My concern with that is that if you wait and see and we turn out to be correct, it will be too late to do anything about it.
Isn't it too late to do anything about it now anyways? It's already done and signed. That's why at this point, it pretty much is a "wait and see".
 

turgy22

Nothing Special
Well, yeah, but things would have been different no matter who was elected, Obama or Bush. Given that one of them would have to face the economic problems when they were elected, the question is: Would Bush have done anything differently? Honestly, I'm guessing no. But whatever he may or may not have done AND the results/consequences of such actions are probably exploring the realms of "impossible-to-know".
I think you mean McCain. I don't recall Bush running in 2008.
 
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EricBess

Guest
If that's your conclusion from watching the bailout results, then I'm not sure you're seeing the whole picture. Yeah, it sucks to see those in the suits and at the top seemingly rewarded (although it happens all the time in "normal" times, execs getting golden parachutes during takeovers and such). But what if the banks failed? What happens to a) the "regular" employees and b) the assets of the bank, particular mortgages? There's probably more but those are the top two I can think of. With the bailout, people keep their jobs and thus DON'T add to the unemployment and people's homes are safe.
No one is claiming that there wouldn't have been huge problems and a lot of people out of jobs. Mortgages would have been bought up by the banks that were more solvent. Money in banks if federally insured to a certain amount, so that would have hit tax money, but no more than the bailout did anyway. Had there been runs on banks, things could have gotten worse for more banks, so if you want to talk gloom and doom, there are scenarios there also.

But banks have always taken some risks, but the posibility of failure keeps things in line and mitigates greed. With "too big to fail", what is going to mitigate the greed in the future? The government?

Question: Those who have it and enjoy or those that don't?
Have what? Obamacare doesn't actually give anyone anything that I'm aware of. Health insurance premiums are going to go up, not down. Yes, there are going to be people with diabetes or other long-term illnesses that benefit and I'm all for that, but there are other ways to address that. Obama touted numbers like 45 million without insurance, but what he didn't say is that a huge percentage of this number was college students in good health who didn't feel like they needed insurance. There are certainly going to be some people who genuinely couldn't afford insurance and they will get subsidies to purchase insurance. This will also drive premiums up as a third-party payer issue. The fact that a small percentage of the population is in a better position than they were doesn't offset the fact that overall health care quality will likely be reduced based on what has happened in other countries and with other programs.
Isn't it too late to do anything about it now anyways? It's already done and signed. That's why at this point, it pretty much is a "wait and see".
There are states talking nullification and there exists the smallest possibility of getting it repealed before it goes into effect. There has also been talk of not funding it from the Senate. I'm not saying I necessarily support any of these options, but it certainly isn't too late and next week's vote will be a pretty big indicator.
 

Spiderman

Administrator
Staff member
No one is claiming that there wouldn't have been huge problems and a lot of people out of jobs. Mortgages would have been bought up by the banks that were more solvent. Money in banks if federally insured to a certain amount, so that would have hit tax money, but no more than the bailout did anyway. Had there been runs on banks, things could have gotten worse for more banks, so if you want to talk gloom and doom, there are scenarios there also.
I just don't see what good alternative Obama or McCain would have had, if they had not done the bailout. Other banks buying up the mortgages? They weren't doing it during the crisis, I don't think they would have done it afterwards. And don't forget, it was also that huge giant insurance firm that was at risk and got the bailout - seeing how big it was, I don't think smaller insurance firms could "pick up the slack". And if it went out of business, a ton of people and places would be out of insurance also.

But banks have always taken some risks, but the posibility of failure keeps things in line and mitigates greed. With "too big to fail", what is going to mitigate the greed in the future? The government?
An argument to keep better regulators and to listen to the good ones watching for this kind of thing.

Obama touted numbers like 45 million without insurance, but what he didn't say is that a huge percentage of this number was college students in good health who didn't feel like they needed insurance.
How huge?

next week's vote will be a pretty big indicator.
I guess we'll see then.
 
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EricBess

Guest
I just don't see what good alternative Obama or McCain would have had, if they had not done the bailout. Other banks buying up the mortgages? They weren't doing it during the crisis, I don't think they would have done it afterwards. And don't forget, it was also that huge giant insurance firm that was at risk and got the bailout - seeing how big it was, I don't think smaller insurance firms could "pick up the slack". And if it went out of business, a ton of people and places would be out of insurance also.
When did they have a chance to do it "during the crisis"? The government stepped in immediately and didn't give a chance for things to happen naturally. Eventually, several banks were bought out by other, more solvent banks. The biggest problem is that there were International banks involved and bancrupcy laws aren't really clear in International situations.
An argument to keep better regulators and to listen to the good ones watching for this kind of thing.
Regulation doesn't always mitigate greed - it breeds corruption. Risk does a much better job of mitigating greed. The problems started because government got involved and changed the equation, reducing the amount of risk involved. This allowed greed to grow. Yes, increased regulation might have helped, but the better solution is to let the market do its job instead of trying to create artificial markets.
How huge?
Honestly, I don't remember exact numbers, but it was something like 20% of the uninsured couldn't afford it. Around 10% were temporarily uninsured (between jobs) and of the rest, about half were college-age and the rest had sufficient incomes, but chose to spend their money elsewhere. They didn't specify whether the college kids could afford insurance, but they showed interviews and the typical response was that they could get very inexpensive catastrophic insurance, but they did think they needed it.

With unemployment rates increasing, I would say that the 10% of "between jobs" people is probably higher right now and less "between".
 

Mooseman

Isengar Tussle
Regulation doesn't always mitigate greed - it breeds corruption. Risk does a much better job of mitigating greed. The problems started because government got involved and changed the equation, reducing the amount of risk involved. This allowed greed to grow. Yes, increased regulation might have helped, but the better solution is to let the market do its job instead of trying to create artificial markets.
The "market" is a nice fantasy, but a lot of the money made in the mortgage and derivative markets was already taken out of the market as salaries and bonuses for performances that turned out to be false. That money is gone and the risk is less or non-existent for those people. Also the lessening of risk was the reduction or removal of regulation for banks and investment firms. Their capitalization was lowered and thus their risk was lowered.
The biggest problem was allowing banks to become investment companies.

Also, there were no firms or banks that would have been able to "buy up" the failed ones and they wouldn't have tried, since the risk greatly outweighed the possible rewards. There was one that bought out Lehman or Wichita or one of them at the beginning and that was coordinated or forced by the government in 2008 and it failed miserably. The bailout was horrible, but to let those banks fail would have been catastrophic to world and US markets. At least now, with regulators breathing down their necks, some of them are actually paying back the bailout money.... can't remember which one, but they are pay 37 billion of the 100 billion they got and in only 2 years. The first TARP had no mechanisms in place for leverage to make them pay it back, but then regulations were put in place to pressure these entities to get out from under the governments yoke.....

Sorry I am not on these discussions much, but I get EB argument at work form a few of my Tea Party friends and I think it may be just some overload.
 

Spiderman

Administrator
Staff member
EricBess said:
When did they have a chance to do it "during the crisis"?
I'm pretty sure the banks knew what was going on before the government. And since at the time they couldn't be sure that the government would bail them out (since the government didn't know about it), I would hope they were exploring their option on how to save their bank. Being bought by another would have been one of those options.

Regulation doesn't always mitigate greed - it breeds corruption. Risk does a much better job of mitigating greed. The problems started because government got involved and changed the equation, reducing the amount of risk involved.
No, the problems started because the government DID NOT get involved when the derivative marketing and bundling of mortgages began. There was a whole series of articles on this in the Post some time ago. There was one head regulator who sounded warnings and thought this kind of trading should be regulated and was overruled by the other big financial heads at the time, Greenspan and the head of Treasury and a couple of others. So because this kind of trading went unregulated, it was unchecked and all sorts of tomfoolery occurred and brought about the financial crisis.

Honestly, I don't remember exact numbers, but it was something like 20% of the uninsured couldn't afford it. Around 10% were temporarily uninsured (between jobs) and of the rest, about half were college-age and the rest had sufficient incomes, but chose to spend their money elsewhere.
So this health insurance for all initiative doesn't provide for income levels, but just gives it to all if they don't currently have it?

Mooseman said:
Sorry I am not on these discussions much, but I get EB argument at work form a few of my Tea Party friends and I think it may be just some overload.
Jump in anytime :)
 
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EricBess

Guest
I'm pretty sure the banks knew what was going on before the government. And since at the time they couldn't be sure that the government would bail them out (since the government didn't know about it), I would hope they were exploring their option on how to save their bank. Being bought by another would have been one of those options.
I have a friend that had a game store. Recently, business has been bad and he was forced to go out of business. As part of this, he started liquidating his assets, selling off games at reduced prices because they hadn't been selling at full price. In some cases, he still made money, just not the markup that would have been necessary to stay in business. In some cases, he ended up losing money. But in all cases, he didn't reduce the price at all until he had stated that he was going out of business.

Clearly, the financial markets are more complicated, but a lot of the same principles still apply. Loans are assets that can be (and are) bought and sold.
No, the problems started because the government DID NOT get involved when the derivative marketing and bundling of mortgages began.
We may have to agree to disagree here. I certainly agree that the government could have done more when that started happening that the fact that they didn't was an case of dropping the ball. However, I strongly disagree with you that this is where the problems started. The problems started well before that. The government has kept interest rates artificially low for a very long time now. They also encouraged (through incentives as well as Fannie Mae and Freddie Mac purchasing such loans) loans that allowed people to get into homes with no money down and stated incomes. Since these were risky loans that the banks were encouraged to make, the bundling of mortgages started happening as a way of mitigating this risk.
So this health insurance for all initiative doesn't provide for income levels, but just gives it to all if they don't currently have it?
I don't understand your question. My only point was the president has been throwing around a "45 million uninsured" figure as a reason we needed to push healthcare reform. Certainly there are people that cannot afford healthcare. I suppose he could have more accurately said that 8 million cannot afford it.

Most of that 45 million are in a position where they are going to be forced to purchase something they don't really want right now. Taxpayer money will now pay for this for the small percentage of those who cannot afford it, and everyone else's premiums will increase.

But none of this addresses why insurance is getting so expensive. There is a huge third-party payer situation that just gets worse with Obamacare. There are already too few incentives to innovate and this makes it worse.
 

Spiderman

Administrator
Staff member
Clearly, the financial markets are more complicated, but a lot of the same principles still apply. Loans are assets that can be (and are) bought and sold.
But the point is, no one wanted to buy the "bad" or "toxic" loans that were bringing the banks down.

The problems started well before that. The government has kept interest rates artificially low for a very long time now. They also encouraged (through incentives as well as Fannie Mae and Freddie Mac purchasing such loans) loans that allowed people to get into homes with no money down and stated incomes. Since these were risky loans that the banks were encouraged to make, the bundling of mortgages started happening as a way of mitigating this risk.
We may well have to disagree :) I'm not sure what you mean but "artificially low for a long time" and what exactly "artifically low" *is*, but interest rates were in the double digits in the 80's. The bundling of mortgages did NOT start happening as a way of mitagating risk, they started to make money. And it was all in the early 2000's; again, the series of articles detailed exactly when it began and by what company. Bundling high-risk loans with some low-risk loans to make it attractive was not done before then.

In another thread, I provided a source that detailed default rates, which were no higher until the mid-2000's when the market started to crash and this all unraveled. Having people get into homes with no money down and stated incomes before that time did not have an adverse effect on such defaults; banks were still checking and making "reasonable" loans to such people.

So I'm not sure how you're getting your information, but I think it's causing some mistaken impressions.
 
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EricBess

Guest
But the point is, no one wanted to buy the "bad" or "toxic" loans that were bringing the banks down.
Not at the prices they wanted to sell them. My point is that there is probably a price point where someone would have been willing to buy. Were the banks unwilling to take a loss?



We may well have to disagree :) I'm not sure what you mean but "artificially low for a long time" and what exactly "artifically low" *is*, but interest rates were in the double digits in the 80's. The bundling of mortgages did NOT start happening as a way of mitagating risk, they started to make money. And it was all in the early 2000's; again, the series of articles detailed exactly when it began and by what company. Bundling high-risk loans with some low-risk loans to make it attractive was not done before then.
Mitigating risk and making money are two sides of the same coin. If you get greedy, you risk complete failure. The question is, did they come up with the scheme and then decide they could make more risky loans? Or did they make the more risky loans because of government incentives and then come up with the scheme as a way to mitigate the risk of those risky loans? My understanding is that the risky loans came first.

In another thread, I provided a source that detailed default rates, which were no higher until the mid-2000's when the market started to crash and this all unraveled. Having people get into homes with no money down and stated incomes before that time did not have an adverse effect on such defaults; banks were still checking and making "reasonable" loans to such people.

So I'm not sure how you're getting your information, but I think it's causing some mistaken impressions.
The government had been pushing programs of low-income housing well before 2000. If more people are able to "afford" housing, then demand is going to cause housing prices to increase. Because housing prices are increasing, the risky loans didn't matter because by the time they came due, people had enough equity to refinance. That didn't make the loans any less risky. Saying that no money down and stated incomes before that time didn't have an adverse affect as proof that the loans weren't risky is like saying that parachuting isn't dangerous because people do it all the time without problems. Risky doesn't mean failure. The problem is that the government programs created a spiral where such loans appeared less and less risky all the time until the market finally hit a point where it couldn't continue to inflate and then it all started to crumble.

Were there mistakes made in the mid-2000s that contributed to the problem? Certainly, but the root causes started much sooner.
 

Spiderman

Administrator
Staff member
Not at the prices they wanted to sell them. My point is that there is probably a price point where someone would have been willing to buy. Were the banks unwilling to take a loss?
Perhaps. Or the government found out and realized they had to take action because no one was taking it at the acceptable price point and they were going to fail before then.

The question is, did they come up with the scheme and then decide they could make more risky loans? Or did they make the more risky loans because of government incentives and then come up with the scheme as a way to mitigate the risk of those risky loans? My understanding is that the risky loans came first.
"Risky" loans have always been around, I'm not arguing that. But the schemes came about because the people took the existing risky loans, packaged them and sold them, and then said hey, we're making money, let's make more. The risky loan business exploded after that.

If more people are able to "afford" housing, then demand is going to cause housing prices to increase.
The program were available but banks weren't taking in anybody, they still did screening or their acceptance rate were still within "normal" parameters. Thus, demand was not substantially increasing and housing prices were not substantially increasing. Again, this only happened after the 2000's. Any chart on housing prices or loan acceptance rates will tell and show you this.
 
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DarthFerret

Guest
Gonna jump in here with my opinion of the entire problem. It is a false sense of entitlement. Generally speaking, society is leaning more and more toward the thought process: "I am an American, (or Illegal Immigrant living in America) and I am entitled to have a driver's license, home, computer, cable, fast food meals, etc...etc... without any strings attatched." It is this thought process that is inherently flawed and, in my opinion, a huge part of the problem. People have gone away from the true American Dream of working hard and reaping your own rewards. A part of this is the natural course of a "wealthy nation", but another part of this is trying to get the government involved in almost every aspect of a person's life. No, a person is not "entitled" to own a home. You have the right to work hard (or smart) and buy a home, or to learn and abide by the traffic laws and have a driver's license, or to follow the current laws and become a legal citizen. But there is nothing written anywhere (nor should there be) that by just existing in a location, you are entitled to have such things. For about 4 years I tried an experiment with myself and my wife. I shut off our cable service. At the time, my income was sufficient to afford it, but my wife was not working. I told her that if she wanted to have cable service, she would have to gather up her on money somehow (I was assuming by working) and have it turned on, and keep paying the bill. Guess what happened? She got a part-time job, and not only turned on the cable (after a few years), but also bought her own vehicle. Amazing how that works huh?

Same thing should apply to Health Insurance (hey its your life, take care of it!), Housing Loans (there are still apartments out there, I am living in one right now), and Luxury Items (T.V.s, Computers, Cell Phones, etc...). If you want it, get off your butt and work for it. Stop looking for a hand out. In the 60-70's most families (yes even the ones in nicer housing) had one T.V. I know in our society now, computers are becoming more and more neccessary (heck, most job applications are done over the internet now), but the local library, work-force center, etc, have computers that you can use. It is not a neccessity and people certainly should not be entitled to these luxuries.

Sorry, got long winded, but this bugs me more and more each day. This whole attitude of "I have the right to do this or that" where I really want to adopt the philosophy of Dennis Leary and shoot them and say "no you don't!" (slight exageration, not some psycho disgruntled postal worker here). Speaking of which...hmm...disgruntled postal worker. Many of you (if not all) know what that saying is implied to mean. Why a postal worker? Oh wait, a government run company (program, whatever), where the employees are so upset that they resort to this? It would not be a saying if it hadn't happened. So be prepared for the "disgruntled health insurance agent" coming soon to an America near you!
 

Spiderman

Administrator
Staff member
I think that's part of it, but a lot is also parents giving their children that stuff and thus the "entitlement" expectations begin. I'm sorry, but I believe that most immigrant, illegal or otherwise, *are* working harder than a lot of Americans because they aren't raised with that self of entitlement - they *know* they have to earn it.

As for your "disgruntled postal worker" - I had to laugh (since I work in the government too). You know there hasn't been any news stories lately (I'm talking years) about them... funny how something that happened in the 90's stays 15 or so years later. Yet of course, there's plenty of example of private company workers going in and shooting their fellow employees and workers... but I guess those companies' names just don't have the right ring to it. :)
 
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EricBess

Guest
Perhaps. Or the government found out and realized they had to take action because no one was taking it at the acceptable price point and they were going to fail before then.
Define "acceptable".

Thank you DF. I completely 100% agree. The government keeps going in a direction where more and more the "have nots" need to be "protected" by the government in the name of "equality". I have my own opinions about entitlement in the home, but the more entitlement programs we have in the government, the worse this problem gets.
 

Spiderman

Administrator
Staff member
I'm using your definition. Whatever the banks were asking for it and expecting to get (or the pospective buying bank were waiting for the price to fall to).
 
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EricBess

Guest
But that's exactly my point. If the bank was going to fail and no one was willing to purchase their loan bundles at the prices they were asking, they wouldn't have had any choice but to lower the price in an effort to reclaim as much as they possibly could. The government never really let that happen.

A business failing isn't an instantanious thing. There are processes for selling off assets and paying creditors.
 
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