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01-25-2011, 11:58 AM   #1
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How Public Unions Took Taxpayers Hostage

Fred Siegel has an interesting piece detailing the history of the movement to unionize government workers in the wsj today.

FDR said it pretty clearly:
QuoteQuote:
And in a 1937 letter to the head of an organization of federal workers, FDR noted that "a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable."
And union leaders used to have a brain:
QuoteQuote:
Private-sector union leaders were also divided. George Meany, the president of the AFL-CIO from 1955-1979 who came out of the building trades, argued that it was "impossible to bargain collectively with the government." Private unionists more generally worried that rather than winning a greater share of profits, public-sector labor would be extracting taxes from a public that included their own workers.
Talk about turning a financial crisis into a real crisis:
QuoteQuote:
On July 1, 1975, New York sanitation workers walked off the job, allowing garbage to pile up in the streets of a Gotham already in the throes of fiscal crisis. In short order, cops objecting to furloughs imposed by the city's liberal Democratic Mayor Abe Beame shut down the Manhattan side of the Brooklyn Bridge, with marchers carrying signs that read "Cops Out, Crime In" and "Burn City Burn."
Fred Siegel: How Public Unions Took Taxpayers Hostage - WSJ.com

01-25-2011, 01:21 PM   #2
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More boogy men?????????
how about how the banks/credit cards took homeowners hostage.......
You know if there was a decent private workforce then all of this would be moot......
not related:
http://en.wikipedia.org/wiki/History_of_union_busting_in_the_United_States
Related;
http://www.democracynow.org/2011/1/6/crackdown_on_organized_labor_states_call
Related;
http://www.democracynow.org/2011/1/6/crackdown_on_organized_labor_states_call
QuoteQuote:
JUAN GONZALEZ: And isn’t it true also—because I’m old enough to remember that in the old days, 20, 30 years ago, pension funds, which were supposedly holding the money for the retirees that had already been paid into a system, were largely invested in safe securities, in bonds—you know, it was usually two-thirds in bonds, one-third in the stock market. But over the years, as governments reduced their pension contributions, they encouraged these funds more and more to invest in the stock market. So, precisely when the market crashes, all these pension funds, because now they are overwhelmingly exposed to the equities market, now suddenly find—reporting historic losses now in the pension funds that now have to be made up. So you’ve got the very politicians who pushed moving these pension funds into the equities market are now having to deal with the consequences, but they want the workers to pay for it.

Last edited by jeffkrol; 01-25-2011 at 03:08 PM.
01-25-2011, 01:48 PM   #3
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QuoteOriginally posted by jeffkrol Quote
.............
You know if there was a decent private workforce then all of this would be mute.......
.................
You mean moot?
01-25-2011, 03:11 PM   #4
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QuoteOriginally posted by Parallax Quote
You mean moot?
actually both may apply.......... IF the private sector was healthy, generally states have enough cash......

Of course it all goes back to our total lack of understanding of our economy.........
'New Captains of Industry' Hosts Economic Roundtable Focused on U.S. Budget and Trade... -- HOUSTON, Jan. 3, 2011 /PRNewswire/ --
QuoteQuote:
Jarkesy noted, "Listening to this discussion has inspired me to want to personally investigate the thoughts and theories shared during the show; and, if confirmed true, determine why the American public, our policymakers and the media appear to be so misinformed. In my opinion, the issues put forth by the panel challenge existing U.S. economic doctrines which Americans have long considered as 'truths' and have been acting on them as such. From this insightful discussion, our listeners may discover that fear mongering is indeed shaping U.S. economic policy; and we could all be victims of a misinformation snowball dating back to when our country was on the gold standard."
In other words it don't freaking matter unless you let it matter........
This is funny because Bernanke's comments can be taken 2 ways yet this article probably picks the wrong one.......
As Bernanke clearly stated:

“We need to think about making investments for the future as opposed to simply spending our seed corn on current needs. So thinking about government programs, we should ask the question, will this provide benefits in the future.” …
sonds like more spending on "real benefits" ie health and infastructure.......

“On the tax side, I don’t think it’s really very controversial among economists that rising rates, combined with a multiplication of exemptions, deductions, credits and so on, leads to a tax code which is very complex and can distort economic decisions.”
No mystery here........
also keep in mind net wealth on the lower and middle classes was zero to negative........


Last edited by jeffkrol; 01-25-2011 at 03:22 PM.
01-25-2011, 03:35 PM   #5
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QuoteOriginally posted by jeffkrol Quote
how about how the banks/credit cards took homeowners hostage.......
Bull. People wanted the houses. They didn't care that the values were overinflated and didn't care that they really couldn't afford them. Don't give me they didn't know, because it was damn obvious back in 2002 what was going on. It's not the bank's fault those people agreed to terms they knew deep down they couldn't abide by. What I will hold the banks responsible for is making such larger numbers of loans, that when the housing market bubble did finally burst, they were not in a position to still support themselves. That was about as dumb a move as the idiots that bought the houses.
01-25-2011, 05:19 PM   #6
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QuoteOriginally posted by Jodokast96 Quote
Bull. People wanted the houses. They didn't care that the values were overinflated and didn't care that they really couldn't afford them. Don't give me they didn't know, because it was damn obvious back in 2002 what was going on. It's not the bank's fault those people agreed to terms they knew deep down they couldn't abide by. What I will hold the banks responsible for is making such larger numbers of loans, that when the housing market bubble did finally burst, they were not in a position to still support themselves. That was about as dumb a move as the idiots that bought the houses.
you really should read more........ last time I bought a house the banks were pretty thorough in checking if I could afford it.. and the're really were THOROUGH..... your statements are blatantly false. That many people couldn't "CON" that many bankers without them cooperating.......THAT should really never need to be said.
BASIS one is that the housing market would not pop so they could afford them by refinancing when the mortgages reset.. problem was that never happened.. Financial gambles are what set us apart..... and what create successful companies...
SECONDLY many of these failures were from real estate speculators NOT mom and pop.......... Try reading some more.
[YT]http://www.youtube.com/watch?v=bNmcf4Y3lGM[/YT]


QuoteQuote:
The media has almost completely overlooked one of the most important aspects of the housing debacle. What has been disregarded is the key role that investors and speculators played in creating the housing bubble and exacerbating the collapseAn important 2005 survey taken by the National Association of Realtors (NAR) found that in 2004, 23% of the 7.7 million existing residences sold throughout the country were purchased as investments rather than to be owner-occupied. This was up from 22% the previous year. Later surveys revealed that in the three peak years of the house price bubble, investors bought 28% of all existing homes sold in 2005, 22% of all those sold in 2006, and 22% of those sold in 2007. This means that during the four bubble years of 2004-2007, roughly 7 million speculators bought existing residences for investment, not to be owner-occupied.

This speculative investing was heavily concentrated in 20 major metropolitan areas such as Chicago, Los Angeles, New York, Phoenix, Miami, Las Vegas, and Orlando. How frenzied this speculative home-buying became in these cities is best shown by Chicago. According to monthly sales figures revealed on trulia.com, an incredible 600,000 Chicago residences changed hands during the peak bubble years of 2005-2007. Because the average price per square foot for homes sold in Chicago is down 36% from the 2007 peak according to trulia.com, nearly all of these buyers are underwater now -- the outstanding mortgage debt exceeds the value of the property............As early as August 2007, the Mortgage Bankers Association had reported that investors accounted for 32% of all prime mortgage defaults in Nevada, 25% of defaults in Florida, 21% of defaults in California, and 16% for the nation as a whole. Real estate research firm Applied Analysis found that roughly 60% of all foreclosures in Las Vegas in 2007 were on residences owned by investors. Research by The Real Deal published in their May 2008 issue revealed that 60% of the 15,000 foreclosure filings in New York City in 2007 were on two-to-four family houses owned by investors and multi-family buildings. An important, well-researched article posted online in November 2009 by the St. Petersburg Times found that 44% of the 11,967 residential properties foreclosed in 2007-2009 in Hillsborough County, Florida were owned by investors who did not occupy these homes........................Foreclosure filings are now extremely concentrated in the 20 major metropolitan areas which had witnessed the most speculation in 2004-2007. Roughly 53% of the 938,000 foreclosure filings announced by RealtyTrac for the third quarter of 2009 were recorded in these large metropolitan areas. ..................This potential avalanche of foreclosed properties awaiting the housing market will put tremendous downward pressure on home prices. Until this foreclosure tsunami begins to subside, the housing market in those 20 major metropolitan areas which created the bubble will continue to erode.
http://www.realestatechannel.com/us-markets/residential-real-estate-1/real-e...-2010-2136.php

Last edited by jeffkrol; 01-25-2011 at 06:30 PM.
01-25-2011, 07:15 PM   #7
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Then let me rephrase. Affording, and safely and adequately affording within ones means, are two different things. I was referring to the latter. Banks really only look at the former, and that divide is where the problem begins. I don't dispute the speculation that was occurring from '04 or '05 on, but the bubble had already been in full force, and yes people were trying to take advantage of it. Speculation was not the cause of everything, but did speed up the inevitable.

01-25-2011, 09:01 PM   #8
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QuoteOriginally posted by Jodokast96 Quote
Then let me rephrase. Affording, and safely and adequately affording within ones means, are two different things. I was referring to the latter. Banks really only look at the former, and that divide is where the problem begins. I don't dispute the speculation that was occurring from '04 or '05 on, but the bubble had already been in full force, and yes people were trying to take advantage of it. Speculation was not the cause of everything, but did speed up the inevitable.
Many sides have to take blame...... americans trying to grab the "american dream" via real estate wealth accumulation is not exactly the people who should "have known better"........
Investors allege massive fraud by Countrywide - WSJ.com
QuoteQuote:
A lawsuit alleges Countrywide Financial and two of its former executives misled institutional investors who bought mortgage-related investments that they claim were portrayed as low-risk.

The lawsuit was filed Monday in New York State Supreme Court by investors who bought hundreds of millions of dollars in Countrywide's mortgage-backed securities from 2005 to 2007, before the housing market went bust. The list of a dozen plaintiffs includes New York Life Insurance and TIAA-CREF Life Insurance.

The complaint names Countrywide, various subsidiaries, two former company executives, and Bank of America, which bought Countrywide in 2008.

A Bank of America spokeswoman says it appears large, sophisticated investors are looking to blame someone for losses caused largely by the recession.

A spokesman for former Countrywide CEO Angelo Mozilo didn't immediately return messages
I am literally AMAZED that a bunch of dumb american homeowners could wreak sooo much havoc w/ people that should "know better".......
http://en.wikipedia.org/wiki/Countrywide_financial_political_loan_scandal
http://en.wikipedia.org/wiki/Bank_of_America_Home_Loans
funny sort of........
QuoteQuote:
On June 4, 2009, the U.S. Securities and Exchange Commission charged former CEO Angelo Mozilo with insider trading and securities fraud, and former COO David Sambol and former CFO Eric Sieracki with securities fraud for failing to disclose Countrywide's lax lending standards in Countrywide's 2006 annual report.[59][60] Despite these charges, Countrywide, and then its successor Bank of America, were awarded the Property Management contract with the Veterans Administration. A July 22, 2008 memo from Judith Caden, VA Director of Loan Guaranty Service issued this proclamation in Circular 26-08-10. Bank of America still retains this position with VA.
Feel free to keep blaming your neighbors though...... not the corrupt system...
QuoteQuote:
. In 2006, 45% of those mortgages were conventional non-conforming loans, loans too large to sell to Fannie Mae.[9] The company generally performs the ongoing servicing functions related to the mortgage loans that it produces. It also provides various loan closing services, such as title, escrow and appraisal.
Never bite the hand that feeds you eh........

Last edited by jeffkrol; 01-25-2011 at 09:10 PM.
01-25-2011, 10:14 PM   #9
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Not once have I ever seen a thread saying "Union members take your money elsewhere".Why is that?
01-26-2011, 05:19 AM   #10
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Uh, I'm not saying I'm not blaming the system. But I don't feel one bit sorry for those "neighbors" that lost out over getting in over their heads. I know some of them personally, work with some others, and one is even a family member.
01-26-2011, 06:14 AM   #11
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QuoteOriginally posted by Jodokast96 Quote
Uh, I'm not saying I'm not blaming the system. But I don't feel one bit sorry for those "neighbors" that lost out over getting in over their heads. I know some of them personally, work with some others, and one is even a family member.
In a sense your blaming the victim....
QuoteQuote:
The report does knock down — at least partly — several early theories for the financial crisis. It says the low interest rates brought about by the Fed after the 2001 recession; Fannie Mae and Freddie Mac, the mortgage finance giants; and the “aggressive home ownership goals” set by the government as part of a “philosophy of opportunity” were not major culprits.

On the other hand, the report is harsh on regulators. It finds that the Securities and Exchange Commission failed to require big banks to hold more capital to cushion potential losses and halt risky practices, and that the Fed “neglected its mission.”
http://www.nytimes.com/2011/01/26/business/economy/26inquiry.html?_r=1&hp=&a...terstitialskip
QuoteQuote:
“The captains of finance and the public stewards of our financial system ignored warnings and failed to question, understand and manage evolving risks within a system essential to the well-being of the American public. Theirs was a big miss, not a stumble.”

The report’s implications may be felt more in the political realm than in public policy. The Dodd-Frank law overhauling the regulation of Wall Street, signed in July, took as its premise the same regulatory deficiencies cited by the commission. But the report is sure to be a factor in the debate over the future of Fannie and Freddie, which have been run by the government since 2008.

Though the report documents questionable practices by mortgage lenders and careless betting by banks, one striking finding is its portrayal of incompetence.

It quotes Citigroup executives conceding that they paid little attention to mortgage-related risks. Executives at the American International Group were found to have been blind to its $79 billion exposure to credit-default swaps, a kind of insurance that was sold to investors seeking protection against a drop in the value of securities backed by home loans. At Merrill Lynch, managers were surprised when seemingly secure mortgage investments suddenly suffered huge losses.

By one measure, for about every $40 in assets, the nation’s five largest investment banks had only $1 in capital to cover losses, meaning that a 3 percent drop in asset values could have wiped out the firm. The banks hid their excessive leverage using derivatives, off-balance-sheet entities and other devices, the report found. The speculative binge was abetted by a giant “shadow banking system” in which the banks relied heavily on short-term debt.

“When the housing and mortgage markets cratered, the lack of transparency, the extraordinary debt loads, the short-term loans and the risky assets all came home to roost,” the report found. “What resulted was panic. We had reaped what we had sown.”

The report, which was heavily shaped by the commission’s chairman, Phil Angelides, is dotted with literary flourishes. It calls credit-rating agencies “cogs in the wheel of financial destruction.” Paraphrasing Shakespeare’s “Julius Caesar,” it states, “The fault lies not in the stars, but in us.”

Of the banks that bought, created, packaged and sold trillions of dollars in mortgage-related securities, it says: “Like Icarus, they never feared flying ever closer to the sun.
If you continue to blame the "small people" you will never see the true criminals.....
Of course none of this has to do w/ unions.......
01-26-2011, 07:38 AM   #12
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I don't see them as victims, and that's where we differ. They had just as much hand in it as the guy pushing the loan. If a pushy salesman gets me to buy something I could not afford, and I later regret it, it's my damn fault for being stupid, gullible, and not thinking it through well enough. Are you saying it's the dealerships fault my neighbors car got repossessed?
01-26-2011, 08:05 AM   #13
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QuoteOriginally posted by Jodokast96 Quote
I don't see them as victims, and that's where we differ. They had just as much hand in it as the guy pushing the loan. If a pushy salesman gets me to buy something I could not afford, and I later regret it, it's my damn fault for being stupid, gullible, and not thinking it through well enough. Are you saying it's the dealerships fault my neighbors car got repossessed?
Yes, there should be morality in business.......
to use your example if a dealer tells you a car will last a lifetime, knowing darn well it has a "bad tranny" that will fail in a few years and will cost you more then the value of the car they sell you yes he "should know better"......
Many of the people who "over leveraged" were not over leveraged at the time and the future predictions from the "experts" were that they would be fine (knowing that 1)it is supposed to be OK or 2)knew darn well they would be in trouble) and believing those experts, even possibly contrary to their own better judgment or thinking they were smart enough to get out in time went ahead w/ their purchase. NOBODY I know would find it pleasant to be thrown out of their house... and again many of these were speculators and second properties...
As a landlord I had 2 couples looking for a rental after they were in foreclosure.. One's payments went from $600/month to $1800/month when the ARM kicked in.. There plan (and what they were told) was that they could re finance before being put at risk.. Credit froze and they were SOL....... Both had jobs but were forced out. Were they "stupid"??? I don't look at it that way, and neither did they. Actually they weren't bitter but disappointed that things "didn't work out" as they were told they would.......
No the banks either knew better and didn't care because they "passed the buck" or were truely in denial that house prices would go down...... IF the "experts" couldn't get it right what hope was there for the "average joe".......
01-26-2011, 08:16 AM   #14
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I am cautious about believing anyone who wants to justify spending money on something ridiculously overpriced as an "investment."

Realtors try to do this
People with LBA try to do this
People who like to buy expensive clothes do this
Someone else was doing this last night...
01-26-2011, 08:22 AM   #15
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Before the unions, the guilds protected workers from exploitation, and eventually made their members wealthy people. The rich and powerful have always expected people to give up thier lives for their own wealth. There are no coulds or woulds or shoulds. That's the way it is. Workers will always band together to protect themselves. The rich have always attacked the unions and the guilds or anyone that doesn't make it possible for them to acquire insane amounts of wealth. It's the governements protection of those who caused the latest meltdown that is the biggest cave in in history. Where else do you have corporate powers milking the population for billions of dollars, and the governement just walking away.

What does the right really hate about unions? They can't con them. The government lets them walk away with billions in bonuses while ruining the economy. NO government has ever effectively reined them in. The right wing has the government regulator eating out of thier hands and feeding them huge bonuses and salaries. The only thing stopping them from making even more money is the untions. So of course you get threads from the tyrants saying "the unions are holding the government hostage." That's funny. The government bailed out the huge bonuses paid to all those bank execs with taxpayers money, and the hilarious part of that, was because execs ruined the economy, the unions had to agree to cuts.

The rich right honestly believes they are owed everything, and the peasants should be greatfull to them for letting them live. Unions are an incredible inconvenience to them and they will stop at nothing to bad mouth them and bring them under "control".

But think about it "the guy at the top says the guys who actually do the work.. are taking too much." Well it's more likely the guy making the charges is taking too much for doing nothing useful. In the world of the rich right, the flashlight never points both ways.
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