Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: Dr. Id who wrote (2514)	7/18/2002 1:22:33 PM
From: stockman_scott	Respond to of 89467

What About Government Accountability? by Rep. Ron Paul, MD lewrockwell.com Accounting scandals dominated the headlines last week, and publicity-hungry politicians from both the House and Senate enjoyed acting self-righteous while grilling WorldCom executives. However, the message that Congress will clamp down on corporate accounting practices rings hollow with at least one journalist. Neil Cavuto from Fox News recently offered a very important question that desperately needs to be asked of Congress: "Who the heck are YOU to judge?" Given the incredible fiscal mismanagement that pervades the federal government, Congress is "throwing stones from a very big glass house," as Mr. Cavuto puts it. It’s refreshing to hear Mr. Cavuto point out the hypocrisy of politicians standing in judgment of executives whose misdeeds pale in comparison to their own reckless spending. This does not mean corporate America is innocent. Many big corporations soak taxpayers for billions in government subsidies every year, while using political influence to avoid fair competition in the marketplace. Criminal conduct by executives at Enron, WorldCom, or any other company should be prosecuted vigorously under state fraud laws. If these executives indeed lied to investors, presented false earnings statements, or otherwise stole from shareholders, they should return the stolen money and serve jail time. Yet Mr. Cavuto is absolutely right. No corporation on earth comes close to the accounting fraud practiced year after year by the federal government. In fact, there is no real accountability at all for the trillions in tax dollars raised and spent annually by Congress and our entrenched federal agencies. The official "accounting" that does take place is a sham. Every year Congress creates a meaningless budget, the Fed prints phony money, the Budget office issues false revenue forecasts, and the administrative agencies waste billions in the most unproductive ways imaginable. Literally tens of billions of dollars go unaccounted for every year, simply disappearing down bureaucratic black holes. This hardly represents a standard against which corporations should be judged! None of the free-market restraints against financial mismanagement apply to government. The federal government doesn’t need to raise money by meeting a market demand or raising investment capital – it simply takes what it wants through taxes, which can be raised at will. It never has to operate profitably or efficiently; witness Amtrak and the Postal Service. It also has no incentive to cut costs. In fact, federal agencies scramble to spend every last penny of their budgets to justify more the next year. There is no stock price to worry about, and nobody tracks government "performance" against earlier years. Nobody ever gets fired. Simply put, the money is not hard-earned, so it’s not well-spent. So why is there not more outrage about government financial accountability? Of course we read the occasional news article lamenting $400 hammers at the Pentagon, but for the most part Congress gets a free pass on its own fiscal mismanagement. What we hear instead are calls for more regulation of our already heavily regulated mixed economy. Few suggest that federal interference in the market, especially Federal Reserve expansion of credit, creates the distortions that make it possible for corporations to become so overvalued in the first place. No one mentions that market forces ultimately cut through the distortions, causing the stock prices of fraudulent corporations to plummet. Instead we hear denunciations of the free market, and calls for more regulations from the very career politicians who are so completely unfit to manage anything. Of course Congress could clean up its financial mess, but ultimately it is voters who must demand accountability for their tax dollars. Remember that you give government at all levels nearly half of everything you earn. If you invested that much into a private company, don’t you think you would keep a close eye on it and demand accountability as a shareholder? The only thing we know for sure about the federal budget is that it will go up each year unless and until voters remove the politicians who insist on taxing, spending, and borrowing us to death. July 18, 2002 Dr. Ron Paul is a Republican member of Congress from Texas. Ron Paul Archives _________________________________ Dr. Id: Welcome to this thread...we ask the tough questions here -- about our leaders, about our markets, about the economy, etc....of course we have some fun too...=)....BTW, I tend to agree with you about 'how It shouldn't surprise us anymore to have another corrupt Republican Administration'...Of course most administrations from both parties have some corruption -- IMO, the Bush Administrations could be one of the worst...I hope I'm proven wrong. Yet, I would be shocked if Bush and Cheney last more than one term...The mainstream media is starting to ask the tough questions and the market's heading south quickly -- folks won't forget whose running the country when they vote again.

To: Dr. Id who wrote (2514)	7/20/2002 4:56:36 AM
From: stockman_scott	Respond to of 89467

Don't expect Bush Inc. to cure this hangover By Ellen Goodman Syndicated columnist Friday, July 19, 2002 BOSTON — Here's the TV image I intend to freeze-frame for my "Summer of '02" album: an earnest George Bush assuring an Alabama audience that "our economy is fundamentally strong" while the streamer below him follows the stock market down the graph and into the tank. Our first MBA president, the man who once thought it was a compliment to be called CEO of the United States, now has a credibility gap on the economy as great as his predecessor had on fidelity. His words have no more impact on folks voting with the remnants of their 401(k)s than CEO John Sidgmore's promise that WorldCom was too big to fail. But even less credible than Bush's economic analysis is his moral analysis. "America," he said, "must get rid of the hangover that we now have as a result of the binge, the economic binge we just went through." Binge? This was America's binge? We dunnit? Is it possible that the head of Bush Inc. seems to believe that we lost our way in what he now describes as the make-believe land of "endless profit" and "no tomorrow"? The president spoke as if workaday men and women had let the bubble go to their heads like an overdose of champagne and needed a weekend at Betty Ford to sober up. He even implied that our passion for bubbly was the result of the Clinton era rather than the CEO era, with its weakness for stock options and funny math. And he spoke as if Bush Inc. had no hand in what Alan Greenspan called a time when "an infectious greed seemed to grip much of our business community." Whose binge was this anyway? In the "go-go" 1990s, the income gap between the rich and the poor kept grow-growing. In 1980, CEOs at the largest companies made 42 times what the average factory worker earned. In 2001, they made 411 times as much. Last year the Oracle chief took home $706.1 million. Today, the Who's Who of CEOs who run this administration ranges from a Halliburton vice president to a Searle secretary of defense to an Alcoa secretary of the treasury. In social policy-making, this group went on its own regressive binge. Last year, Bush pushed through a $1.4-trillion tax plan that bought off the middle class with a $300 check. Now the clock on the national debt has started up again and the deficit is headed for $165 billion. Whose binge? The White House cast of corporate characters wants to put some of your Social Security into the same tank as your 401(k). And just moments after he warned of a "hangover," the president was promoting an end to the estate tax, a windfall for the heirs of Enron etc. Doesn't this sound like what Greenspan called "an outsized increase in opportunities for avarice"? Yes, millions of Americans got high on the dot-com boom. They got hooked on the great-man theory of business. The New York Times once dubbed WorldCom's Bernard Ebbers as "A Long Distance Visionary." BusinessWeek put Tyco's Dennis Kozlowski on the cover as the man who has "managed to sail smoothly through the economic slowdown." For a while, you couldn't tell the best-seller list from the Fortune 500. Now, at least when Republicans swallow hard and talk about "personal responsibility," the target is CEOs and not welfare mothers. Now, when Congress rants and legislates against people who don't play by the rules, the subject is corporate fraud and not welfare fraud. But today, 60 percent of American households have (less) money in a market that has lost $6 trillion in value. The money, to paraphrase economist John Kenneth Galbraith, has gone the same place your lap goes when you stand up. That's going to translate into millions of Americans working into their "golden years" or helping elders on incomes no longer so fixed. This investment "hangover" that cuts across geography and ethnicity and age is also isolating. For every American angry at the con game, there is another one angry at herself, mad that she didn't sell high. This early — yes, early — in the scandal, it's not clear yet whether we'll think of ourselves as investors with separate crashing portfolios or as citizens with one joint account and accountability. Into this morass comes Bush with his binge politics expecting our trust. The same core group that got us into this fix now says they'll get us out. Bush Inc.? The cure for this hangover is going to be the hair of a very different dog. ______________________________________ Ellen Goodman's column appears Friday on editorial pages of The Times. Her e-mail address is ellengoodman@globe.com. Copyright © 2002 The Seattle Times Company seattletimes.nwsource.com