"Financial death spiral "coming soon for state and local Governments, to pay for fat public sector pensions

  1. You have chosen to ignore posts from ComingLiberalCrackup. Show ComingLiberalCrackup's posts

    "Financial death spiral "coming soon for state and local Governments, to pay for fat public sector pensions

    http://www.city-journal.org/2014/eon0710sm.html" rel="nofollow">http://www.city-journal.org/2014/eon0710sm.html


    Detroit was able to actually trim some outrageous costs of public pensions, under emergency state laws.. However, this is the exception...


    "In many states, by contrast, local laws and state court rulings have made it virtually impossible to cut back retirement benefits for current government employees, even for work that they have yet to perform. These state protections, which go far beyond any safeguards that federal law provides to private-sector workers, are one reason why so many states and localities are struggling to dig themselves out of pension-system debt, amid sharp increases in costs. It will take significant reforms to state laws—or bigger and more painful bankruptcy cases—to make a real dent in the pension crisis."


    "Many state courts—including those in Pennsylvania, Arizona, and Colorado—have been influenced by a series of California legal decisions (often referred to, collectively, as the “California Rule” on pensions) which hold that the pension contract begins immediately upon employment, and that the terms of a government worker’s pension can only change if the alterations are “accompanied by comparable new advantages,” or benefits. The California Rule, University of Chicago legal scholar Richard Epstein has written, “Neuters the power of local governments to alter and amend, by wiping out all government flexibility to correct prior errors in pension program design or funding.” One result, he observes, “is a financial death spiral” in many municipalities."


    Government cant reform pension plans, EVEN where the public worker has not yet earned such benefits?This "California Rule " takes sovereignty away from citizens to decide how to spend their tax dollars , and creates a privileged special class of public employees...we must increase taxes endlessly on the poor and struggling private sector workers to perpetually fund the gold plated pensions of our ruling class! These pensions can never be cut!


    "....where a number of municipalities entered bankruptcy in recent years, thanks in part to their inability to alter their unaffordable pensions. Courts, meanwhile, have short-circuited reform attempts. Voters in the city of San Jose, where pension costs have risen to $245 million, from $73 million in 2002, passed a ballot initiative in 2012 installing a new, less expensive pension system. But in December, a California judge invalidated the key changes, based on her interpretation of state court precedents.The decision leaves California municipalities facing a bleak future. From 2006 through 2013, local governments that participate in the giant California Public Employees’ Retirement System saw their annual pension costs double, on average. Last year, the CalPERS board voted to require an additional contribution increase of 50 percent, phased in over five years. “While there is time to plan for the increase, the most fiscally stressed municipalities could find the increases unmanageable,” Moody’s wrote."


    "In some cities, reformers are challenging these inflexible state rules. San Jose mayor Chuck Reed is promoting a ballot initiative to amend the California constitution and allow municipalities to alter their pension plans. He’s sure to face stiff opposition from government unions, which are likely to spend at least $50 million to defeat the measure."


    More proof that our "public servants" are our masters....they dont work for us, we work for them! And soon private sector workers will be toiling at low wages just to fund the absurdly fat pensions of coddled public sector employees, retiring young and in Florida, living it up.... 

     
  2. You have chosen to ignore posts from Hansoribrother. Show Hansoribrother's posts

    Re:

    I smell bailouts.....which is only going to shift the burden to the Federal Government. Of course they can borrow, print, etc. but eventually what they print will not have the buying power that it does now. At some point shiite is going to happen. 

    While it is easy to blame politicians, they are doing nothing because that is what we want them to do. We are just waiting for it to blow up. Then the party is over.

     
  3. You have chosen to ignore posts from ronreganfan. Show ronreganfan's posts

    Re:

    In response to Hansoribrother's comment:
    [QUOTE]

    I smell bailouts.....which is only going to shift the burden to the Federal Government. Of course they can borrow, print, etc. but eventually what they print will not have the buying power that it does now. At some point shiite is going to happen. 

    While it is easy to blame politicians, they are doing nothing because that is what we want them to do. We are just waiting for it to blow up. Then the party is over.

    [/QUOTE]

    I have several family members on public pensions, or looking forward to them.  They get all in you face when you talk about there. Not being enough money, AND most of them mistakenly claim that they put away for their pensions.  All this, and unheard of job security to boot.

    I just wish they were in it with us instead of taking it out of us.

    they are our overlords.

     
  4. You have chosen to ignore posts from high-road. Show high-road's posts

    Re:

    Ya'll are arguing constitutional contract law versus public policy.


    The California Rule is the proper interpretation of Constitutional law ... it might not make for good puplic policy but that is a seperate issue. If you don't like the consequences of the CA rule, then change the Constitution, don't gripe about it's proper application.


    That's always the problem with the self-proclaimed 'constitutionist' wingnut's ... when they run head-on into constitutional facts they think they can bend, mold or ignore the very thing they say they want to defend. Apparently their defense of the Constitution is based on their selective interpretation of what they want it to be ...  not the reality of what's actually contained in said Constitution.


    From the conservative and libertarian Federalist Society:


    The Contract Clause, which prohibits states from making laws impairing the obligation of contracts, is commonly used to challenge state and local public pension reform efforts....Thus, in states where the California rule applies, one can’t constitutionally increase employee contribution rates or reduce cost-of-living allowances.


    This rule is properly viewed either as an application of the federal Contract Clause, which usually defers to state law on the threshold question of whether there’s a contract and what it covers, or as an application of a more generous state Contract Clause. Thus, there’s nothing legally invalid about the California rule.


     


    http://www.fed-soc.org/publications/detail/overprotecting-public-employee-pensions-the-contract-clause-and-the-california-rule

     
  5. You have chosen to ignore posts from ComingLiberalCrackup. Show ComingLiberalCrackup's posts

    Re:

    In response to high-road's comment:



     




    Ya'll are arguing constitutional contract law versus public policy.




     




    The California Rule is the proper interpretation of Constitutional law ... it might not make for good puplic policy but that is a seperate issue. If you don't like the consequences of the CA rule, then change the Constitution, don't gripe about it's proper application.




     




    That's always the problem with the self-proclaimed 'constitutionist' wingnut's ... when they run head-on into constitutional facts they think they can bend, mold or ignore the very thing they say they want to defend. Apparently their defense of the Constitution is based on their selective interpretation of what they want it to be ...  not the reality of what's actually contained in said Constitution.




     




    From the conservative and libertarian Federalist Society:




     




    The Contract Clause, which prohibits states from making laws impairing the obligation of contracts, is commonly used to challenge state and local public pension reform efforts....Thus, in states where the California rule applies, one can’t constitutionally increase employee contribution rates or reduce cost-of-living allowances.




     




    This rule is properly viewed either as an application of the federal Contract Clause, which usually defers to state law on the threshold question of whether there’s a contract and what it covers, or as an application of a more generous state Contract Clause. Thus, there’s nothing legally invalid about the California rule.




     




     




     




    http://www.fed-soc.org/publications/detail/overprotecting-public-employee-pensions-the-contract-clause-and-the-california-rule" rel="nofollow">http://www.fed-soc.org/publications/detail/overprotecting-public-employee-pensions-the-contract-clause-and-the-california-rule" rel="nofollow">http://www.fed-soc.org/publications/detail/overprotecting-public-employee-pensions-the-contract-clause-and-the-california-rule" rel="nofollow">http://www.fed-soc.org/publications/detail/overprotecting-public-employee-pensions-the-contract-clause-and-the-california-rule" rel="nofollow">http://www.fed-soc.org/publications/detail/overprotecting-public-employee-pensions-the-contract-clause-and-the-california-rule




     





    Did the public employee unions and their partners in crime, the Democratic politicians bought and paid for by the unions, notify the taxpayers when they met to LOL..."negotiate", about what is good public policy???


     


     


    Did they tell taxpayers about this "California rule"? Every time you hire a public employee, that employee's future excess pension benefits....NOT PAID FOR, mind you....and not yet earned, mind you...


     


    Cannot ever be subject to fiscal reality? That the taxpayers literally must go broke and pay their last cent to the pension, and the public employee CANT be asked to contribute any more than they already have (nothing in most cases)???


     


    Did they? I dont think so.

     
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  7. You have chosen to ignore posts from ComingLiberalCrackup. Show ComingLiberalCrackup's posts

    Re:

    Your moonbat mind only works in a narrow focus... any outrage is acceptable, as long as you find some instance where some Republican did a similar thing....


     


    In this case, you are mixing apples and oranges...


     


    "Worst funded" public pension plan.....is a different issue than the absurd gold plated pension plans themselves, which politicians give away for future private sector taxpayerse to pay for...


     


    Not 'worst funded' ...but WORST pension plans...California takes the cake, their public sector is way out of control....


     


    You only care that Government coffers are engorged with taking as much loot from the hardworking private sector taxpayers...yes, States with absurdly high tax rate rates can better fund the outrageously high pensions.....slightly better, still will bankrupt most states..unless confiscatory taxes are imposed...

     
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  9. This post has been removed.

     
  10. You have chosen to ignore posts from ronreganfan. Show ronreganfan's posts

    Re:

    At some point, these public workers, at least those with high school educations, will realize that the taxpayer is their golden goose, and they are killing it

     
  11. You have chosen to ignore posts from high-road. Show high-road's posts

    Re:

    In response to ComingLiberalCrackup's comment:



    Your moonbat mind only works in a narrow focus... any outrage is acceptable, as long as you find some instance where some Republican did a similar thing....


    In this case, you are mixing apples and oranges...



    "Worst funded" public pension plan.....is a different issue than the absurd gold plated pension plans themselves, which politicians give away for future private sector taxpayerse to pay for...


    Not 'worst funded' ...but WORST pension plans...California takes the cake, their public sector is way out of control....



    You only care that Government coffers are engorged with taking as much loot from the hardworking private sector taxpayers...yes, States with absurdly high tax rate rates can better fund the outrageously high pensions.....slightly better, still will bankrupt most states..unless confiscatory taxes are imposed...


     



    Ya, ya I know ... it's always the libruls fault ... that not only did wingnut-led states negotiate gold-plated pension plans ... but the wingnut plans are so expensive that their states can't even afford to fund them ... despite being welfare states who can't survive without all the money from Uncle Sugar.... it's those dirty libruls and their Jedi mindtricks again ... and their subsidizing of the wingnut states again ... it's all the libruls fault again.

     
  12. You have chosen to ignore posts from ronreganfan. Show ronreganfan's posts

    Re:

    In response to high-road's comment:
    [QUOTE]

    In response to ComingLiberalCrackup's comment:

     

     

    [QUOTE]

     


    Your moonbat mind only works in a narrow focus... any outrage is acceptable, as long as you find some instance where some Republican did a similar thing....


    In this case, you are mixing apples and oranges...



    "Worst funded" public pension plan.....is a different issue than the absurd gold plated pension plans themselves, which politicians give away for future private sector taxpayerse to pay for...


    Not 'worst funded' ...but WORST pension plans...California takes the cake, their public sector is way out of control....



    You only care that Government coffers are engorged with taking as much loot from the hardworking private sector taxpayers...yes, States with absurdly high tax rate rates can better fund the outrageously high pensions.....slightly better, still will bankrupt most states..unless confiscatory taxes are imposed...
    [/QUOTE]

     



    Ya, ya I know ... it's always the libruls fault ... that not only did wingnut-led states negotiate gold-plated pension plans ... but the wingnut plans are so expensive that their states can't even afford to fund them ... despite being welfare states who can't survive without all the money from Uncle Sugar.... it's those dirty libruls and their Jedi mindtricks again ... and their subsidizing of the wingnut states again ... it's all the libruls fault again.

    [/QUOTE]

    YES!

    we are getting somewhere with you. It is obvious that the liberals made this mess, and now are trying to tell us alls well.

     
  13. This post has been removed.

     
  14. You have chosen to ignore posts from ZenArcher. Show ZenArcher's posts

    Re:

    In response to ronreganfan's comment:
    [QUOTE]

    In response to Hansoribrother's comment:
    [QUOTE]

    I smell bailouts.....which is only going to shift the burden to the Federal Government. Of course they can borrow, print, etc. but eventually what they print will not have the buying power that it does now. At some point shiite is going to happen. 

    While it is easy to blame politicians, they are doing nothing because that is what we want them to do. We are just waiting for it to blow up. Then the party is over.

    [/QUOTE]

    I have several family members on public pensions, or looking forward to them.  They get all in you face when you talk about there. Not being enough money, AND most of them mistakenly claim that they put away for their pensions.  All this, and unheard of job security to boot.

    I just wish they were in it with us instead of taking it out of us.

    they are our overlords.

    [/QUOTE]

    ron,

    I have lived both side of this equation. Grew up in a totally union household. After I had my own household, it has been all private sector. No job security. No pensions. Etc.

    Some unions are more reasonable than others. Some just fight for everything they can get. For example, some Teamster unions have one worker for every five about to retire. A disaster about to happen. The pension guarantee board about to step in in many places.

    Union people are in it to a certain extent of course. They still pay federal taxes, states taxes and city taxes if they apply. Their town or city can go bankrupt like some already have.

    However, IMO most union members see it as they want what they were promised when they started even if the promises were unrealistic.

    One obvious solution is to vote for politicians who will hold a stronger line with the public sector unions. Private companies need to do the same with their various unions.

    I do agree with high-road regarding the Cal. Rule. Like it or not, that is the law.

     
  15. You have chosen to ignore posts from ComingLiberalCrackup. Show ComingLiberalCrackup's posts

    Re:

    In response to high-road's comment:
    [QUOTE]

    In response to ComingLiberalCrackup's comment:

     

     


    Your moonbat mind only works in a narrow focus... any outrage is acceptable, as long as you find some instance where some Republican did a similar thing....


    In this case, you are mixing apples and oranges...



    "Worst funded" public pension plan.....is a different issue than the absurd gold plated pension plans themselves, which politicians give away for future private sector taxpayerse to pay for...


    Not 'worst funded' ...but WORST pension plans...California takes the cake, their public sector is way out of control....



    You only care that Government coffers are engorged with taking as much loot from the hardworking private sector taxpayers...yes, States with absurdly high tax rate rates can better fund the outrageously high pensions.....slightly better, still will bankrupt most states..unless confiscatory taxes are imposed...



     



    Ya, ya I know ... it's always the libruls fault ... that not only did wingnut-led states negotiate gold-plated pension plans ... but the wingnut plans are so expensive that their states can't even afford to fund them ... despite being welfare states who can't survive without all the money from Uncle Sugar.... it's those dirty libruls and their Jedi mindtricks again ... and their subsidizing of the wingnut states again ... it's all the libruls fault again.

    [/QUOTE]


    Highroad, Do you ever address the substance of an issue, or is it all your fantasy 'red state takers' spiel all the time?

    What should blue and red states do about the out of control union pensions? Do you support the rigid powerful unions, who refuse to compromise an inch and would seemingly kill the golden goose?

    Your endless spiel about the welfare red states seems to indicate you dont like the federal Government takeover of traditional state functions, and federal overspending and subsidies....except of course you do....

     
  16. You have chosen to ignore posts from 8101956. Show 8101956's posts

    Re:

    IMO it's the criminals on Wall Street that are the boogey men not public employees .

     
  17. This post has been removed.

     
  18. You have chosen to ignore posts from ZenArcher. Show ZenArcher's posts

    Re:

    In response to 8101956's comment:
    [QUOTE]

    IMO it's the criminals on Wall Street that are the boogey men not public employees .

    [/QUOTE]

    8101956,

    To look at this part of our financial problems, the point is the boogeyman are parents scared us with when we were children was not real...the "criminals' on Wall Street are but you cannot legally call most of them criminals.

    Most of us know very few Wall Streeters have been prosecuted over the years regardless of what they have done. They always seem to escape criminal charges. The phrase "too big to fail" is part of our lexicon.

     

     

    "The notion of too big to jail just got very serious as the nation’s chief attorney agreed with the idea that financial institutions are too large to prosecute.

    US Attorney General Eric Holder testified before the Senate Judiciary Committee on Capitol Hill today, and discussed the lack of criminal cases against financial institutions in the aftermath of the financial crisis.

    That’s been a point of irritation and frustration for many in Washington and across the country who feel big banks that were partially responsible for the credit and housing bubble yet went unpunished. Instead, they were given billions in federal bailout money because they were deemed too big to fail. And now while their stocks recover the rest of the economy is barely trudging along.

    Holder’s remarks today may add fuel to that fire.

    “I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” he said. “And I think that is a function of the fact that some of these institutions have become too large.”

    In other words, too big to fail has morphed into something more perverse. Not only are big banks bigger than they were during the financial crisis but now the Department of Justice fears bringing criminal charges against them because of the possible repercussions such proceedings would have on the greater economy.

    That’s not the first time we’ve heard about the Justice Department’s hesitation to prosecute big financial institutions. Most recently when going after UBS for its role in the global Libor scandal the Wall Street Journal reported that officials at the DoJ were “heartened by the lack of a negative reaction in the markets and among regulators around the world to UBS‘s guilty plea. Before the settlement deal, some officials had worried it could destabilize the bank.”


    That’s a very scary, very ugly way to run the country. Not only are financial institutions operating under the notion of too big to fail but now there’s room for them to behave as negiligently as possible without fear of a criminal case from the federal government.

    It’s no wonder then that big banks hate the idea of breaking up. Just about every big bank CEO that has publically pushed back on the idea of breaking up their bohemoth institutions. Here are some of their reactions to the idea:

    Morgan Stanley CEO, James Gorman: “This is a knee-jerk discussion that’s been going on. We need to just calm down, let this play out with the new regulation, the new capital rules, and at that point then figure out which businesses to accelerate, and which businesses to slow down.”
    Bank of America CEO Brian Moynihan: The universal banking model is the “most important” model there is because it gives consumers access to global information, capital markets, investment advice and basic banking all in one place. “We can’t be competitive if we can’t provide all those services to our consumers,” he notes.


    JPMorgan Chase CEO, Jamie Dimon: “There are huge benefits to size. We bank Caterpillar in like 40 countries. We can do a $20 billion bridge loan overnight for a company that’s about to do a major acquisition. Size lets us build a $500 million data center that speeds up transactions and invest billions of dollars in products like ATMs and apps that allow your iPhone to deposit checks. We move $2 trillion a day, and you can see it by account, by company. These aren’t, like, little things. And they accrue to the customer. That’s what capitalism is.”


    Former Citi CEO, Vikram Pandit: “[Citicorp is] a tried and proven strategy. Why did it work? Because it was a strategy based upon operating the business and serving clients and not a strategy based on dealmaking. That’s the fundamental difference.”


    It pays to be big and it also keeps you out of court."

     

    http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/

     
  19. You have chosen to ignore posts from ronreganfan. Show ronreganfan's posts

    Re:

    In response to 8101956's comment:
    [QUOTE]

    IMO it's the criminals on Wall Street that are the boogey men not public employees .

    [/QUOTE]

    Part of the same hypocrisy.

     
  20. You have chosen to ignore posts from ronreganfan. Show ronreganfan's posts

    Re:

    In response to ZenArcher's comment:


    In response to 8101956's comment:
    [QUOTE]


    IMO it's the criminals on Wall Street that are the boogey men not public employees .




    8101956,


    To look at this part of our financial problems, the point is the boogeyman are parents scared us with when we were children was not real...the "criminals' on Wall Street are but you cannot legally call most of them criminals.


    Most of us know very few Wall Streeters have been prosecuted over the years regardless of what they have done. They always seem to escape criminal charges. The phrase "too big to fail" is part of our lexicon.


     


     


    "The notion of too big to jail just got very serious as the nation’s chief attorney agreed with the idea that financial institutions are too large to prosecute.


    US Attorney General Eric Holder testified before the Senate Judiciary Committee on Capitol Hill today, and discussed the lack of criminal cases against financial institutions in the aftermath of the financial crisis.


    That’s been a point of irritation and frustration for many in Washington and across the country who feel big banks that were partially responsible for the credit and housing bubble yet went unpunished. Instead, they were given billions in federal bailout money because they were deemed too big to fail. And now while their stocks recover the rest of the economy is barely trudging along.


    Holder’s remarks today may add fuel to that fire.


    “I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” he said. “And I think that is a function of the fact that some of these institutions have become too large.”


    In other words, too big to fail has morphed into something more perverse. Not only are big banks bigger than they were during the financial crisis but now the Department of Justice fears bringing criminal charges against them because of the possible repercussions such proceedings would have on the greater economy.


    That’s not the first time we’ve heard about the Justice Department’s hesitation to prosecute big financial institutions. Most recently when going after UBS for its role in the global Libor scandal the Wall Street Journal reported that officials at the DoJ were “heartened by the lack of a negative reaction in the markets and among regulators around the world to UBS‘s guilty plea. Before the settlement deal, some officials had worried it could destabilize the bank.”



    That’s a very scary, very ugly way to run the country. Not only are financial institutions operating under the notion of too big to fail but now there’s room for them to behave as negiligently as possible without fear of a criminal case from the federal government.


    It’s no wonder then that big banks hate the idea of breaking up. Just about every big bank CEO that has publically pushed back on the idea of breaking up their bohemoth institutions. Here are some of their reactions to the idea:


    Morgan Stanley CEO, James Gorman: “This is a knee-jerk discussion that’s been going on. We need to just calm down, let this play out with the new regulation, the new capital rules, and at that point then figure out which businesses to accelerate, and which businesses to slow down.”
    Bank of America CEO Brian Moynihan: The universal banking model is the “most important” model there is because it gives consumers access to global information, capital markets, investment advice and basic banking all in one place. “We can’t be competitive if we can’t provide all those services to our consumers,” he notes.



    JPMorgan Chase CEO, Jamie Dimon: “There are huge benefits to size. We bank Caterpillar in like 40 countries. We can do a $20 billion bridge loan overnight for a company that’s about to do a major acquisition. Size lets us build a $500 million data center that speeds up transactions and invest billions of dollars in products like ATMs and apps that allow your iPhone to deposit checks. We move $2 trillion a day, and you can see it by account, by company. These aren’t, like, little things. And they accrue to the customer. That’s what capitalism is.”



    Former Citi CEO, Vikram Pandit: “[Citicorp is] a tried and proven strategy. Why did it work? Because it was a strategy based upon operating the business and serving clients and not a strategy based on dealmaking. That’s the fundamental difference.”



    It pays to be big and it also keeps you out of court."


     


    http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/" rel="nofollow">http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/" rel="nofollow">http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/


    [/QUOTE]

    So, where is the crime in this article? Other than your smear up top, I see no crime, just scale, which, like Walmart, really bubbles down not to size, but control. Union control.

     
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  22. You have chosen to ignore posts from ComingLiberalCrackup. Show ComingLiberalCrackup's posts

    Re:

    In response to WhatNowDoYouWant's comment:
    [QUOTE]

    In response to ComingLiberalCrackup's comment:
    [QUOTE]

    Highroad, Do you ever address the substance of an issue,

    [/QUOTE]

    Well, it's not really irony, but what do we call it? Hubris? Nerve? Projection?

     

     [/QUOTE]


    Cant recall anything of political substance from you other than snark, in months....

     
  23. You have chosen to ignore posts from ronreganfan. Show ronreganfan's posts

    Re:

    In response to WhatNowDoYouWant's comment:
    [QUOTE]

    In response to ComingLiberalCrackup's comment:

    [QUOTE]Cant recall anything of political substance from you other than snark, in months....[/QUOTE]

     

     

    Well, that's either because you are lying or because you simply do not read anything that doesn't agree with your hatred for all things not on the far right.

     

    Literally every one of your posts is some incoherent rant about moon unions and Obama cronies or whatever. So tedious.

    [/QUOTE]

    Moon unions?

    you have jumped the shark as a poster.

     
  24. You have chosen to ignore posts from ZenArcher. Show ZenArcher's posts

    Re:

    In response to ronreganfan's comment:
    [QUOTE]

    In response to ZenArcher's comment:

    [QUOTE]

     

     

    In response to 8101956's comment:
    [QUOTE]

     

    IMO it's the criminals on Wall Street that are the boogey men not public employees .

     

     

    [/QUOTE]

    8101956,

     

     

    To look at this part of our financial problems, the point is the boogeyman are parents scared us with when we were children was not real...the "criminals' on Wall Street are but you cannot legally call most of them criminals.

     

    Most of us know very few Wall Streeters have been prosecuted over the years regardless of what they have done. They always seem to escape criminal charges. The phrase "too big to fail" is part of our lexicon.

     

     

     

     

     

    "The notion of too big to jail just got very serious as the nation’s chief attorney agreed with the idea that financial institutions are too large to prosecute.

     

    US Attorney General Eric Holder testified before the Senate Judiciary Committee on Capitol Hill today, and discussed the lack of criminal cases against financial institutions in the aftermath of the financial crisis.

     

    That’s been a point of irritation and frustration for many in Washington and across the country who feel big banks that were partially responsible for the credit and housing bubble yet went unpunished. Instead, they were given billions in federal bailout money because they were deemed too big to fail. And now while their stocks recover the rest of the economy is barely trudging along.

     

    Holder’s remarks today may add fuel to that fire.

     

    “I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” he said. “And I think that is a function of the fact that some of these institutions have become too large.”

     

    In other words, too big to fail has morphed into something more perverse. Not only are big banks bigger than they were during the financial crisis but now the Department of Justice fears bringing criminal charges against them because of the possible repercussions such proceedings would have on the greater economy.

     

    That’s not the first time we’ve heard about the Justice Department’s hesitation to prosecute big financial institutions. Most recently when going after UBS for its role in the global Libor scandal the Wall Street Journal reported that officials at the DoJ were “heartened by the lack of a negative reaction in the markets and among regulators around the world to UBS‘s guilty plea. Before the settlement deal, some officials had worried it could destabilize the bank.”

     


    That’s a very scary, very ugly way to run the country. Not only are financial institutions operating under the notion of too big to fail but now there’s room for them to behave as negiligently as possible without fear of a criminal case from the federal government.

     

    It’s no wonder then that big banks hate the idea of breaking up. Just about every big bank CEO that has publically pushed back on the idea of breaking up their bohemoth institutions. Here are some of their reactions to the idea:

     

    Morgan Stanley CEO, James Gorman: “This is a knee-jerk discussion that’s been going on. We need to just calm down, let this play out with the new regulation, the new capital rules, and at that point then figure out which businesses to accelerate, and which businesses to slow down.”
    Bank of America CEO Brian Moynihan: The universal banking model is the “most important” model there is because it gives consumers access to global information, capital markets, investment advice and basic banking all in one place. “We can’t be competitive if we can’t provide all those services to our consumers,” he notes.

     


    JPMorgan Chase CEO, Jamie Dimon: “There are huge benefits to size. We bank Caterpillar in like 40 countries. We can do a $20 billion bridge loan overnight for a company that’s about to do a major acquisition. Size lets us build a $500 million data center that speeds up transactions and invest billions of dollars in products like ATMs and apps that allow your iPhone to deposit checks. We move $2 trillion a day, and you can see it by account, by company. These aren’t, like, little things. And they accrue to the customer. That’s what capitalism is.”

     


    Former Citi CEO, Vikram Pandit: “[Citicorp is] a tried and proven strategy. Why did it work? Because it was a strategy based upon operating the business and serving clients and not a strategy based on dealmaking. That’s the fundamental difference.”

     


    It pays to be big and it also keeps you out of court."

     

     

     

    http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/" rel="nofollow">http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/" rel="nofollow">http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/" rel="nofollow">http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/" rel="nofollow">http://www.forbes.com/sites/halahtouryalai/2013/03/06/the-real-reason-wall-street-always-escapes-criminal-charges-the-justice-dept-fears-the-aftermath/

     

    [/QUOTE]

    So, where is the crime in this article? Other than your smear up top, I see no crime, just scale, which, like Walmart, really bubbles down not to size, but control. Union control.

    [/QUOTE]

    ron,

    Where was the smear in my post? I do not see it. What I see is what millions of people have seen regarding these too big to fail institutions. They caused massive damage to our country yet have not and probably will never pay for any of it.

    As the article I quoted stated, "That’s been a point of irritation and frustration for many in Washington and across the country who feel big banks that were partially responsible for the credit and housing bubble yet went unpunished. Instead, they were given billions in federal bailout money because they were deemed too big to fail. And now while their stocks recover the rest of the economy is barely trudging along.".

     

     

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