So it confused me that now, almost three months since it was passed, NOW there is urgency on the part of the Republicans. Where was this urgency for the past three months when we all knew the original CARES relief funds were dwindling? Now the Republicans are saying they WANT it passed so let's hurry, hurry, hurry! They say the Dems are stalling it at the expense of the people of America who guys like McConnell, Trump, Mnuchin and Jay Powell care about so very much. As we covered in no uncertain terms last post. Is this what's REALLY going on, or are people playing politics with American lives? Is it the Democrat Heroes Act, or one that has been revised? I think you can anticipate the answer to that. But it's quite interesting! I've learned a lot through a few hours of research today! I like it when I use the internet for good instead of evil.
Let's go back to the beginning because I (and Inigo Montoya) believe that's the best place to start. But we're not looking for the Man in Black, we're searching for what might be the major sticking point in negotiations between the parties. So it would help to investigate the FIRST Coronavirus relief package, the Corona Aid Relief and Economic Security Act, or the CARES Act. It was the original 2.2 trillion dollar relief package passed jointly (and I doubt there is much else these two parties have done jointly in the entire administration) back on March 25, 2020. At the time it was the largest ever, but the new one could be more. It was divided thusly: 300 billion in one time cash payments to individual Americans; 260 billion in increased unemployment benefits, 350 billion in "forgivable" loans to small business (later increased to 669 billion but as we'll see, precious little actually went where it was meant) 500 billion in aid for large corporations who don't need it and 339.8 billion to state and federal governments who don't deserve it. I don't know how they come up with 2.2 trillion, but government math is always complete bullshit.
Here is a fantastic article by Kathryn Judge who judges (ar ar) that the major flaw in the CARES Act was that "too much support is going to large companies when it should be going to the small ones." Hardly a surprise when you consider that the Republican Senate agreed on it and Donald Trump affixed his cardiac arrest EEG autograph to it. The act authorized treasury secretary Steve Mnuchin to spend the 2.2 or whatever trillion bucks THROUGH the Federal Reserve. Did you know that? I didn't until just a few hours ago. The US FED. as they are known, are the (choke, cough, hablah) regulators whose job it is, ostensibly and nonsensically, to ensure that Steveyboy doesn't funnel the funds directly into the purses of the businesses that he or the Trump administration might favour, or, you know, have been bought by. I'm being fairly glib, but if you read on, you'll see why I, and Ms. Judge, think this is like telling Trump to distribute taxpayer's money fairly. Oh. Geez. That's not what it's LIKE, it's what it IS. Ha ha! I couldn't come up with a simile any better. If you had asked a fox to guard your henhouse, I could then say, "Well that'd be like asking Donald Trump to distribute taxpayer's money fairly," and it'd work. But the simile just doesn't have the hyperbole in reverse, does it? At any rate, you'll see what I mean. Read on McDuff.
Ms. Judge explains that small businesses (those with 500 employees or fewer) contribute 44% of GDP and are 49% of the private sector of America. These are the most vulnerable businesses in times of crisis like these, and will more likely have to declare bankruptcy if they run out of money. As we saw in 2008, some businesses and banks are too big to fail. They transcend pure capitalism. Small businesses aren't and they don't. Liquidation destroys good companies and good jobs. The better jobs in the country because small businesses pay better than the large corporations. This is how killing small business can be claimed by politicians (and always is) as "job creation." Kill a business where 500 people earned 30 bucks an hour and make 1000 new jobs for a larger company that pays 15 bucks an hour. Job creation. Seemples.
But even before the CARES Act was ratified, the FED allocated 750 billion of the 2.2 trill. for the largest corporations. Not just because they love them so much, but because through decades of strategic lobbying and legislation purchase, the FED has been able to establish bureaucratic rules and regulations that they can fall back on and say, "Can't help it. Legal constraints. Nothing we can do about it." Hannah Arendt had a great quote about this and I'll just paraphrase. She reckoned bureaucracy to be the worst kind of tyranny because in a bureaucracy, in which all are equally powerless, we have tyranny without a tyrant. Specifically, section 13(3) of the Federal Reserve Act says loans in "unusual and exigent" circumstances must be adequately secured and credit risks limited. Ironically, as near as my research can tell, the Federal Reserve Act, passed into law in 1913, didn't have these amendments until 1991 or possibly even 2008 when inadequately secured loans were positively in vogue! The banks were encouraged to make them, but the FED was seemingly the only entity legislating AGAINST them. Hmmmm….. that seems fishy. But let me stall my tinfoil hat reaching hand for a moment. Is there more?
Why yes! Aside from the serviceable argument that, "Sorry, we HAVE to give all our dough to the financially stable big boys," there was also the excuse that credit rating are "difficult" to assess for smaller firms, whereas they can be readily assessed for larger companies. Another provision was that, even where grants would be wiser, only loans were available from the FED.
And there is one more that I find fascinating! When a company declares bankruptcy, the company and the workers are the first to be protected financially, while the shareholders take their lumps. So in an emergency, to protect the Joe Average workers, a company going out of business in a crisis could declare bankruptcy, get some help from the Federal Reserve Emergency Relief Fund and not have their workers hurt so badly..... IF anybody gave a shit about the measly working worms. The FED also adopted a policy to never make loans to bankrupted entities. They were covering their asses and the asses of the (rich) shareholders. So who are these heartless fiends? Well, I'm glad I asked that. This is good!
Remember that name you may not have recognized earlier in this post, and if I can go ahead and flatter myself, you Googled as you read - Jay Powell? I hadn't heard of him before my research. He's the head honcho at the Federal Reserve. What they call the chair and has been since 2018. He's a Republican, big surprise, and was appointed, or I guess nominated, by Donald Trump himself. Before I tell you any of the bad stuff I found in my brief search (I'm sure there's LOTS more) I'll tell you one good thing I found about him: he was an MLB pitcher drafted by the Padres in 1990! SOOOO, if he ever becomes president, you ain't gonna get any embarrassing, hanging honorary first pitches. He'll offer up some sweet chin music! And to be more serious, even though he's GOTTA be a money-worshipping hawk of phlegm, I bet he's a really nice guy to talk to and you or I would have an easier time sharing a beer with him than swapping his eyes with his testicles.
Okay, now for the bad stuff. On March 11, 2020, he made the decision to print half a trillion dollars to provide short-term loans for "distressed borrowers" on Wall Street. The next day - another half a trill! Created out of thin air! Dollars are, after all, Federal Reserve Notes. They can DO this shit! That's why all the debt in the world is, to use a financial term, completely bankrupt of verisimilitude! It's just fake pictures on paper that are cranked out to give to, who else?, the rich. Well, I suppose there are a very few poor people on Wall Street trading stocks, but that percentage probably equates to the percentage of the globally super-rich who are the only people who are allowed to make the preferred trades, get the best free shit, and receive all the fake money the fake financial institutions can shit out, even though they need it the least.
And even though he raised interest rates (which I've recently explained, helps the poor, not the rich) and Donald and he exchanged hatred, since Covid, he hasn't enjoyed his job and, you guessed it, lowered interest rates to ZERO!
Steve Mnuchin - Republican. Another Trump flunky. Former investment banker, hedge fund manager and movie producer. With Goldman Sachs for 17 years. The third Goldman Sachs veteran to hold the treasury secretary position in recent years. Bought a bank. That's right, he bought a bank called IndyMac and changed the name to OneWest Bank. His bank became known for quickly foreclosing on borrowers who fell behind on their mortgages. Before that he was a partner in Sears and sued for "asset stripping." He is still embroiled in several pending lawsuits. One lawsuit that, luckily for him, timed out, was one over his involvement in Bernie Madoff's Ponzi scheme.
The very best of the bunch? His "Dune Capital" was one of a group of lenders, including Deutsche Bank, who were sued over the financing of a skyscraper in Chicago... by Donald Trump! He sued his own treasury secretary! Only Trump!
He was also Trump's finance chairman for the 2016 campaign, so he knows, maybe better than anyone, who financed Trump and who Trump owes.
He was instrumental in the 2017 tax "reform," a 320 billion tax cut for corporations that eventually totaled 1.125 TRILLION in net benefits. This added around 2.28 trillion to the national debt over the next 10 years.
Richard Clarida - Republican Vice Chair of the Federal Reserve. Probably another Trump appointee. Until 2018 was global strategic advisor for PIMCO, a global investment firm worth about 2 trill. Hedge funds, pension funds, corporations, etc. "Asset allocation." So he moves money around. Large amounts of it. Another advantage for the rich. It's better than working and far more lucrative!
Randy Quarles - Republican Vice Chair for supervision. Another Trump nominee. He is a private equity investor. Founder and head of Cynosure Group and former partner in the Carlyle Group. Former rep. for the US in the IMF. Dealt with financial responses to crises in Argentina and Turkey. Also in 2005 at the G7 meting in London, he negotiated an historic debt "relief" agreement for the world's poorest countries. So, a vulture capitalist.
Lael Brainard - DEM!!! Administrative Governor. Started with Mckinsey & Company, a financial advisor to corporations, governments and other organizations. This company is associated with many scandals including the Enron collapse in 2001 and the 2007/2008 financial meltdown.
And last, but not least, Miki Bowman - Republican. Trump appointee. Former Sr. staff position on the federal emergency management agency under president George W. Bush. That's FEMA folks. And George W? That's Hurricane Katrina. Member that clusterfuck? Well after that, you're promoted!
If you can, read that Kathryn Judge article again. Now that you know the people through whom the CARES Coronavirus relief money had to flow, is it any wonder Judge judged things the way she did? I had to use that gem one more time. So nice, I used it twice! ;-)
So, with that background, let's move on to the Heroes Act, which was passed in the House May 16, 2020. That's almost three months ago. The Dems who drafted it knew that the original CARES stimulus package would be running out by now for the average American. Especially if they were aware, which I'm sure they were, of the stuff I just wrote above. Not a lot of the 2.2 trillion landed in the hands of the people who needed it. What did most people get, 1200 bucks? And it had to last them 3 months? The country is BROKE right now! At least a large part of it. And they knew it would be if the virus lasted this long, so they came up with a 3 trillion dollar aid package for hazard pay for essential workers, postal service and local and state governments who still don't deserve it. One of the sticking points seems to be the extra money for local and state governments. I guess Dems feel that the politicians got enough with the first relief package.
But here are a few interesting things about this new Heroes package: It was called a "socialist giveaway plan" by Republicans; Mitch Blocker McConnell called it a "liberal wishlist," Trump and McConnell both say the Dems are "holding the relief hostage:" Trump said that the Democrats want stuff that has absolutely nothing to do with the Coronavirus; AND when he first heard about it (or had somebody sum it up for him) he threatened to veto it.
This is where we started. But now it may be a little more obvious what's going on, no? Let me throw another article link at you...
This article talks about the PPP, the paycheck protection program portion of the original Covid relief package that does not require routing through the FED. Here's what the erstwhile Ms. Judge had to say about that: The one important bright spot in the CARES Act is the PPP, a program designed to help small businesses and their employees which does not require the Fed’s involvement. The support takes the form of a low-interest loan, but it gets converted into a grant if the recipient uses the funds to retain employees. Yet even within PPP, shifting from conception to execution reveals some similar challenges. The program was massively underfunded from the start, so the full $350 billion allotted to it has been used up even though the great majority of small businesses—including many that were working hard to get a PPP loan—got nothing from the program. Making matters worse, 40% of the funds were used for payouts in excess of $1 million and many banks favored clients with loans outstanding, so much of the money went to larger small businesses that may have been better situated to get funds elsewhere.
A lot of the money ended up in banks, who don't need it. Not small businesses who did. Another one of these political shenanigans the average person just never sees. And it won't see the light of day in anything but the most honest, and probably most underfunded of media. Now read the beginning of the new link. "Extending the Paycheck Protection Program and expanding Federal Reserve lending facilities — could be on the table in negotiations with the Senate." Extending the PPP, which doesn't use the FED and gets money to small business, and expanding the FED lending facilities, by allowing them to lend to people other than the rich, could be on the table. This is what Ms. Judge suggested. If you continue reading the article there are other things that actually help the REAL people of the United States, not the rich.
Is it just me? Or does anyone else think that when Donald Trump accuses the Democrats for stalling and delaying much needed help it's the pot calling the kettle black?
Could it be Trump trying to LOOK like he's fighting the Dems to get the suffering citizens (who he doesn't give a crap about) some money a few months before the election to get votes? Could it be that he knows that about 4 months after the election taxes will be raised to pay for this relief? Even if he's miraculously re-elected, by then he'll have almost 4 more years for the people to forget this double-cross. It's a win/win! He's even threatening executive actions that he can't make! Does he really, REALLY give that much of a shit while he's putting out on the 13th hole at the expense of these people he's ostensibly fighting for?
I just don't think so. I think the issue is the same thing as party lines demand: Republicans are fighting for the Corona stimulus to be used to help the people who gave THEM money, and the Democrats are fighting for the Corona virus stimulus to be used to help those who gave THEM money... and maybe a little bit to the poor and middle classes.
I have to ask myself why the Dems don't just get this out into the open. Why do they seem to be keeping this desire to help the majority of the country while the Republicans are only trying to help the rich a secret? The answer is, THEY are probably not totally on the level either! If it were as one sided as I've suggested in this post, surely we'd know about it by now! I just haven't figured out the Democrat angle yet. They're usually less obvious than the easily predictable, money-grubbing GOP.
The sad, sad lesson to be learned here seems to be that even in a life or death situation, these two parties, which can't even legitimately be considered parties, are just interested in division and contradiction. That first Covid package was proof that it doesn't have to be like this. Too bad it takes a worldwide pandemic for these talking jackasses to put aside their party lines and help the country. But this is what happens when money takes control of politics.
What a shame!
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