Thursday, September 25, 2008

"Hell No" to Bush Billionaire Bailout

COAST calls on its members to contact their Congressmen and Senators immediately to oppose the latest $700 Billion bailout for America’s richest citizens proposed by President Bush. The vote in Congress presently is anticipated Thursday or Friday. To date, the actual language of the largest bailout bill in American history, which Brit Hume of Fox News says will be voted by the most unpopular Congress in American history at "historic speed," has not even been presented.

Jason Gloyd, COAST Chairman, called the plan "socialism for billionaires and the worst idea of our lifetimes," and said "it is the start of our fastest descent into a government-controlled economy in American history. Washington's interference in financial markets has created this crisis, and Washington's welfare for billionaires will just exacerbate the pain for middle class taxpayers and prolong the downward descent."

The new $700 billion requested by Bush would be on top of more than $415 billion already spent by the Treasury to bail out the failing businesses of billionaires: Bear Stearns ($30 billion), Freddie Mac and Fannie Mae ($300 billion), and AIG ($85 billion). With the new monies sought, the bailout total will exceed $1.1 trillion.

Auto Industry already seeks its (initial) bailout
COAST pointed out that if we bail out Wall Street, inevitably the auto industry, saddled with decades of poor performance, inflexible unions and horrible management putting out an inferior product, and will seek and obtain bailouts as well. See here how Nancy Pelosi and Harry Reid are already scheming for another $25 billion bailout of the poorest performing segment of the American economy. After them, other powerful segments of the economy, with expensive lobbyists handing out huge political contributions, will seek their Washington handouts as well.

Liberal, big-spending Democrats will correctly ask: "If we have $700 billion for billionaires, why can't we fund $1 trillion in new urban capital, why can't we fund $1 trillion in new healthcare spending, and why can't we spend $1 trillion on some new social program?”

Belief In Markets
COAST asserts that believing in free markets, believing in the strength of capitalism, means having the courage to allow poor performers to fail. "Admittedly, it is always a step of faith to allow the markets to find their own equilibrium," said Gloyd. "Bad businesses will fail, and smart businesses will succeed. But in the end, those who are hard-working, smart and thrifty will thrive. The only other option is allowing Washington politicians and bureaucrats to choose the winners and losers -- in exchange for political contributions and even outright graft."

Hear what others are saying about the Great Billionaire Bailout of 2008

COAST is by no means alone in attacking the horrible plan hatched by Bush bureaucrats:

"This is an appalling bad plan and an engine of corruption. It enriches some people by giving them more than they can get [in the market] and not enriching others. The idea that some bureaucrat in Washington is responsible for managing bad paper is socialism at its very worst. It's wrong in every way. It's wrong to take money and bail out Wall Street. It's wrong to give that kind of power to the secretary of the treasury. We don't know what the rules are. We don't know what the structure is. This is all going to be decided in secret by a handful of congressmen and the Secretary of the Treasury with no American knowing what's being decided, and yet it could shape this country for the next 20 years.” -Former House Speaker Newt Gingrich

“This massive bail-out is not the solution, it is financial socialism, it is un-American.” -Kentucky Senator Jim Bunning

"The government brought the economy down, they broke this, I don't think they can fix this. Forget this bailout and focus on pro-growth policies that help our free enterprise system work better. Lower our corporate tax rate, get rid of the capital gains tax. ... The government cannot manage this much money effectively without ineffeciencies and corruption." -South Carolina Senator Jim DeMint

"One of the perverse effects of this bailout proposal is that the worst-performing firms, and those who interjected themselves most deeply into mortgage-backed securities, credit default swaps, and special investment vehicles will be those who benefit the most from this bailout. As with the bailout of airlines in the aftermath of 9/11, those businesses who were the least efficient, least productive, and least concerned with serving consumers are those who will be rewarded for their mismanagement with a government handout, rather than the failure of their company that is proper to the market. This creates a dangerous moral hazard, as the precedent of bailing out reckless lending will lead to even more reckless lending and irresponsible behavior on the part of financial firms in the future." -Congressman Ron Paul

"Before we ask American families to make further sacrifices we need to make sacrifices of our own. Congress must learn the lesson of our current financial situation, which is that you cannot live beyond your means indefinitely. Congress has known about these problems for years, but we did nothing because we were so obsessed with short-term politics and earmarking to do the hard work of oversight and reform that was necessary to avert this mess....The answer now is not a mysterious formula known only to economists at the Federal Reserve, but a commitment among all national leaders to restore the fundamental market principles that made America the world’s leading economic power." -Senator Tom Coburn

"We are concerned that the plan could fundamentally change the role of government in the American free enterprise system." -Congressman Jeb Hensarling, Republican Study Committee Chairman

"The Club for Growth condemned the massive government bailout proposed by the Treasury and the Bush administration as unnecessary, unfair to taxpayers, and fraught with serious costs to the American economy." -The Club for Growth

122 Economists oppose the bailout for three reasons:(i) it is unfair, (ii) it's ambiguous, and (iii) it will have undesirable long term effects: "If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America's dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted." Read their letter here.

Read Walter Williams' editorial “Scaring us to death”

Read Republican Anger at Financial Socialism

Read here how the bailout will prompt inflation.

Politicians Rely Upon Fear
As always, politicians are attempting to instill fear in the citizenry to justify the massive increase in the size and scope of government. In Wednesday night’s speech, Bush said "we are in the midst of an historical financial crisis." Bush warned of “a long and painful recession” if Congress does not quickly enact his billionaire bailout proposal. He threatened taxpayers with “a distressing scenario,” including potential bank failures, job losses and inability for ordinary Americans to borrow money to buy cars or send their children to college.

“George Bush and the democrat Congress have cried ‘wolf’ too many times," said Gloyd. “We will not be cowed by fear time and time again to support Republian-sponsored socialism. We trust the markets.”

We have little time to have our voices heard. Please do not allow us to allow our direction to be dictated by fear. Please call your Senators and Representatives today to oppose the 2008 Billionaire Bailout plan:

Senator Sherrod Brown (D-OH)
(202) 224-2315 Washington office
(513) 684-1021 Cincinnati office

Senator George Voinovich (R-OH)
(202) 224-3353 Washington office
(513) 684-3265 Cincinnati office

House Minority Leader John Boehner (R-OH)
(202) 225-6205 Washington office
(513) 779-5400 Butler County office

Congressional Representative Steve Chabot (R-OH)
(202) 225-2216 Washington office
(513) 684-2723 Cincinnati Office

Congessional Representative Jean Schmidt (R-OH)
(202) 225-3164 Washington office
(513) 791-0381 Cincinnati office

Senator James Bunning (R-KY)
(202) 224-4343 Washington office
(859) 341-2602 Ft. Wright office

Senator Mitch McConnell (R-KY)
(202) 224-2541 Washington office
(859) 578-0188 Ft. Wright office

2008-09-29 Many thanks to everyone who took the time to contact their elected officials. Your efforts paid off. The vote in the house failed 228 to 205 and, unless they reverse themselves, we're not going to waste $700 billion propping up the losers who caused this mess.
Steve Chabot, Geoff Davis and Jean Schmidt all voted against it. John Boehner voted for it. The senate never got a chance to vote. Keep the heat on Boehner and be to sure to thank the others.

2008-10-03 We are eternally grateful to Congressmen Steve Chabot and Geoff Davis for holding fast and voting once again to torpedoe this terrible plan. Minority Leader John Boehner ignored his constituents for a second time and again voted for it. Jean Schmidt fell back into her old habits, breaking ranks from conservatives, and voted in favor of enlarging an already bloated government. Markets reacted to the news falling to their previous pre-bailout lows. We were going to have a recession either way. Only now we have a recession AND another $700 billion in public debt. Priceless.

Thursday, September 4, 2008

$75k Tax Gift - Pepper's "Sweetheart" Deal

When the liberal democrats took control of the County Commission in early 2007, one of their first official acts was to grant $75,000 to the Greater Cincinnati Film Commission. Many wondered why this institution, with only one fulltime employee, would warrant this largess from the Commissioners?

COAST of course sued to stop the expenditure, a suit the Commission fought for more than a year despite the clear illegality of the grant. Suddenly, in June of this year, lawyers for the Commission called and said they wanted to settle the suit, paying COAST's more than $30,000 in legal fees accrued to date. Why?

Just prior to that call, COAST had taken the deposition of Kristen Erwin, the Executive Director of the Film Commission. In that deposition she revealed why Pepper and Portune had bestowed this $75,000 grant: Erwin was the former girlfriend of Pepper. (Read deposition excerpts here.)

Even after their romantic relationship ended, Erwin remained close to Pepper. Erwin listed Pepper as one of her top five Facebook "Friends" (here) and threw a combination political fundraiser/Birthday Bash for Pepper in 2006 (here). Cozy.

It turns out that as a Councilmember Pepper also voted to give Erwin $25,000 of City funds in the very year in which they were dating and another $50,000 the following year.

Pretty nice gig, isn't it, when you can date a trust fund millionaire, and while you are dating you get a $25,000 City grant, and after you break-up get a $125,000 in grants to heal those old wounds? $150,000 in cold, hard taxpayer cash, and it did not cost the multi-millionaire Pepper a penny.

Almost instantly after the Erwin deposition, and before COAST could get Pepper's testimony, the suit settled. Coincidence? COAST thinks not.

There is no word what favors exactly Pepper got in exchange for the grants.

2nd Annual North COAST Picnic - Please Join Us!

You are invited to the Second Annual North COAST picnic on Sunday September 28th, 2008 at 4:00 PM, with dinner served at 5:00 PM at Blue Ash Recreation Center/Park, 4343 Cooper Rd.

Please RSVP to Kim Grant at (513) 479-8475. Fried chicken is provided, but plan on bringing your drinks and a side dish. We do not expect Kristen Erwin or David Pepper to be in attendance, but they have been invited.

Partners Submit 14,015 Red Light Signatures

On August 20, COAST joined its WeDemandAVote.Com partners in submitting 14,015 signatures to place a ban on Red Light Cameras in the City of Cincinnati on the November ballot. The NAACP and its President Christopher Smitherman initiated the effort in March of this year.

The issue is now certified to the ballot, and Cincinnati voters can strike a blow for liberty on November 4 by voting "yes." The issue number has not yet been assigned.

COAST Endorses Proportional Representation

On the same day as the turn-in of the Red Light Camera signatures, COAST joined its WeDemandAVote.Com partners in turning in petitions to place a new system for electing Council on the ballot - proportional representation.

Weeks earlier, COAST endorsed the proposal and joined the signature gathering effort. With P.R., COASTers hope that solid advocates of limited government can be more easily elected to Council. This issue number has also not yet been assigned.

Liberal Overspending Downgrades County's Bond Rating

Under Republican leadership, Hamilton County has consistently enjoyed a strong bond rating from Moody's Investor Service. In 2006, under Republican leadership, Moody's rated Hamilton County bond investments as a solid "Aa2."

On August 13 of 2008, after only 19 months of tax-and-spend democrat leadership of Todd Portune and David Pepper, Moody's downgraded the County's rating to Aa3, meaning Hamilton County will face higher interest payments on its debt obligations going forward.

Portune Two-faced on Butler County Contract

In the midst of the County's deteriorating financial picture, Commissioner Todd Portune has repeatedly blamed Republicans on "prior commissions" for entering into a contract with Butler County to house 400 inmates, costing the County approximately $10 million.

Portune, however, fails to mention that he himself voted seven times in favor of this policy and this expenditure that he now blames for undermining the County's fiscal health:

  • On April 5, 2006, Portune voted to direct the County Administrator to negotiate a contract with Butler County to house Hamilton County inmates.

  • Noting that the Sheriff also approves the expenditure, Portune voted in favor of a second resolution on April 19, 2006 to appropriate $3,181,750 for housing inmates in Butler County.

  • On April 26, 2006, Portune voted in favor of the contract with the Butler County Commissioners to house inmates there.

  • On September 13, 2006, Mr. Portune voted to approved a resolution authorizing a contract with even more bed spaces for Hamilton County inmates - now 300.

  • On March 7, 2007, after the democrats had taken control of the Commissioner Portune voted to approve an additional $3 million allocation for inmate costs.

  • On May 23, 2007, an additional $2,087,000 was allocated for this purpose. Mr. Portune again voted in favor.

  • On August 10, 2007, Portune and Pepper co-authored a further resolution to extend the jail contract for the remainder of 2007.

Port Authority Given Tax & Eminent Domain Powers

In joint enactments by both the Cincinnati City Council and the Hamilton County Commission, in August, the Port Authority of Greater Cincinnati was given broad authority to levy taxes and to exercise powers of eminent domain to take real and personal property from homeowners and businesses. Now, taxes for the "arts," the National Underground Railroad Freedom Center, the Olympics and other silly projects of Cincinnati's elite, that could never muster political support, are vested in the hands of appointed individuals unaccountable to the voters.

2008-09-10 UPDATE. A recent City Beat Article does an excellent job of clarifying the expanded powers of the Port Authority and why DeWine accuses Bortz and Berding of a power grab.

Arts Crowd Brings In Reinforcements for Tax Fight

COAST has been carefully covering the attempts by big-taxers to bring more government funding to the "arts" in Cincinnati and Hamilton County, read here, here and here. Now comes news that the Fine Arts Fund has hired a Washington lobbyist as its new Vice President of the Arts and Culture Partnership.

This City Beat interview highlights the responsibilities of Margy Waller in this new role, and it betrays, or at least hints at, the FAF's plans for pumping more tax monies for the "Arts."

City Beat confronts Waller with the COAST allegation that "Arts" advocates are angling for new tax. Waller refuses to answer the question directly, simply saying:
"The goal is to have a conversation that's not an argument but in fact resonates so much more than the anti-tax talk that this COAST stuff (Coalition Opposed to Additional Spending and Taxes) becomes irrelevant. If the question is "Do you want another tax?" people will always say "No." That's not how you want to have that conversation. It's all about what kind of community we want to live in and how we want our children to grow up."
Waller concludes that her goal is:
"Ultimately what we want is so much public demand that there's no question that these things get funded. And the way to create that sense of public will and public demand is to have a conversation that resonates with enough people that the public demand is there. In the end the bottom line is having that kind of public will that creates the political space for the decision-makers to provide resources and develop policy that's supportive of arts and culture as a critical part of a sustainable and viable community."
Precisely as COAST has said, the "Arts" community is pushing for more and more tax dollars from Hamilton County residents. Just how long will it be before Portune and Pepper, or the newly empowered Port Authority, placed a new tax before the voters for Ms. Waller's "Arts?"

COAST stands ready to continue its "anti-tax talk" on this topic, and relishes the chance to expose any tax-and-spend politician who backs such a proposal.