Life under gangster government: Obama’s $20 billion bank heist

May 19, 2011

And a bunch of states’ attorney generals looking to pander for votes are in on the job. Karl Rove blows the whistle:

At last Wednesday’s “CBS Town Hall,” President Obama said he was “trying to . . . figure out how we can get the banks to do more” on modifying mortgage loan payments. Perhaps, he said, people whose mortgages are underwater should get a “principal reduction, which will be good for the person who owns . . . the home.”

Mr. Obama has decided that taxpayers have no appetite for bailing out homeowners who don’t make their payments, or for rescuing those whose homes are worth less than their mortgages. Instead, he’s backing a proposal by his Department of Justice and state attorneys general to force major banks to cough up the dough.

The money would come from a settlement with JP Morgan Chase, Citibank, Bank of America, Wells Fargo and other banks accused of “robo-signing,” in which foreclosure documents were signed by bank employees or agents without properly certifying all the papers. The attorneys general admit that virtually no one was erroneously foreclosed upon because of robo-signing. The banks foreclosed on people who were on average 18 months delinquent, and after multiple attempts to modify the loan had been tried and failed.

But Justice and the state attorneys general are demanding $20 billion for sloppiness, which they will then be able to hand out to voters—and potential supporters. The money won’t come from the banks; it will come from their customers, millions of whom will pay more in fees and interest and will, in some cases, be denied credit.

This stinks. It’s not only corrupt, it’s bad policy.

As Rove points out, only a few people were hurt in the robo-signing “scandal,” and the proper solution would have been to make them whole with some additional compensation, including returning them to their homes.  Instead, Ali Obama and his 40 Thieves President Obama and the state AGs are abusing the law to extort billions from the banks –at the customers’ ultimate cost– that can then be used to plug state budget gaps or as bait for votes. Far from doing justice, the robo-signing problem has been an excuse to do a great injustice, both to the banks and to the original victims, whose cause has been forgotten.

Michael Barone called this “gangster government” and “thugocracy;” we know it as “The Chicago Way.”

It sure isn’t the Rule of Law.

(Crossposted at Sister Toldjah)


I love my hometown…

November 1, 2009

…But there are times I want to nuke Sacramento from orbit. Usually (and in this case) it’s because of some boneheaded move by the State government.  What did they do this time? Oh, nothing, really, except decide to take an extra ten-percent from our paychecks in the middle of a recession:

Starting Sunday, cash-strapped California will dig deeper into the pocketbooks of wage earners — holding back 10% more than it already does in state income taxes just as the biggest shopping season of the year kicks into gear.

Technically, it’s not a tax increase, even though it may feel like one when your next paycheck arrives. As part of a bundle of budget patches adopted in the summer, the state is taking more money now in withholding, even though workers’ annual tax bills won’t change.

Think of it as a forced, interest-free loan: You’ll be repaid any extra withholding in April. Those who would receive a refund anyway will receive a larger one, and those who owe taxes will owe less.

But with rising gas costs, depressed home prices and double-digit unemployment, the state’s added reach into residents’ regular paycheck isn’t sitting well with many.

“The state’s suddenly slapping people upside the head,” said Mack Reed, 50, of Silver Lake. “It’s appalling how brash that is.”

Brittney McKaig, 23, of Santa Ana said she expects the additional withholding to affect her holiday spending.

“Coming into the holidays, we’re getting squeezed anyway,” she said. “We’re not getting Christmas bonuses and other perks we used to get. So it all falls back on spending. The $40 gift will become a $20 gift.”

Sheer genius. We’re now over a year into a severe recession, and this Christmas is when the stores will really feel the pinch. The money the state takes will be unavailable to retailers big and small, who will thus have less money with which to pay for new employees or keep current ones. California’s real unemployment rate tops 17% at least, and many people rely on part-time seasonal retail jobs to help them make it, so every job counts. The last thing you want to do is divert money to non-productive expenses, such as a blueberry commission.

“But at least it’s not a tax!”

What a farce. In California, all tax increases have to be approved by a two-thirds majority of both chambers of the legislature, something that’s hard to get since the Republicans have just enough votes to hold the line.  We are already one of the most highly-taxed states in the Union, so any increases are very unpopular right now.  So the legislature and the Franchise Tax Board get around this by calling it a “loan.”

When Tiquon and Little Dog take a forced “loan” from a South-Central liquor store, it’s called “robbery” or “extortion.” But when Sacramento does it to the whole state, it’s okay, it’s just a loan.

You can call it what you want, Governor, but a tax is a tax.

But wait,” you say, “they promise to pay it back!”

Would you like to buy the Golden Gate Bridge, too? First, this is an interest-free loan. Whatever money you “loan” to California will be worth less when you get it back, because inflation isn’t accounted for. You are permanently losing money. The state gets the benefit of the current value, you have less when you get it back, ergo that forced exaction of value from our money is a tax.

Oh, and remember those IOUs from earlier this year when the state was running out of money? For years now, the government has not been able to accurately project revenues, consistently overestimating them. What makes anyone think they can get it right this time? How will you feel if (more likely “when”) your involuntary loan is repaid with an interest-free IOU?

Sacramento’s irresponsibility and unwillingness to face reality is appalling. These are people we elected to run the state for the best interests of all, yet they continually mortgage our future and dig an ever deeper fiscal hole, refusing to make the admittedly harsh spending and tax cuts needed to begin to restore California to financial health. Instead they pander to the public employees unions ( the prison guards, for example) and other left-wing single-interest groups that live off the taxpayer and in turn are big donors to legislators’ election campaigns. So they kick the can down the road, pretend that “this time, we’ve fixed the problem” and hope that no one remembers the next time it happens.

California’s political culture is sick, and its public servants instead constitute a ruling class. This is not a democratic republic: thanks to safe seats and special-interest donors, our state government is instead a self-perpetuating oligarchy of professional politicians. This farce with accelerated withholding is just another example of how out of touch with the average Californians the Mandarins of the Golden Dome have become.

If California is to have any Hope, it’s time for a major Change.

(hat tip: Hot Air)

LINKS: Gaius at Blue Crab Boulevard calls it outright theft. McQ puts it this way: “California – ‘We Need The Money More Than You.'” Sister Toldjah and Right Wing News.