Kasich is wrong for Ohio Governor because he offers same rejected GOP plan

The 2010 election for the Governor of Ohio is a perfect example, on a smaller scale, of the Republican obstructionism and having no real ideas for governing. The GOP is also supporting a guy with a Mel Gibson short fuse.

John Kasich, the GOP candidate for Governor, served in the US House of Representives from 1983 to 2001 then left to cash in on his political connections as a contributor to FOX “news” and working for Lehman Brothers – the investment house that collapsed which led to our economy bombing in 2008. While in the House he was chair of the budget committee and helped craft a Federal budget that had a surplus for the first time since 1969.

Great news right? Well, not so much..

The surplus was based on financial deregulation, NAFTA, welfare reform, and first the dotcom bubble and then the housing bubble. Basically his “success” was based on the main GOP campaign tool box = pro-business policy, low taxes, and entitlement spending cuts.

Fast forward to 2008 and those “good” things led directly to the financial collapse. The bankers played their game and took their obscene paychecks, the housing bubble burst leading to millions of foreclosures, and the collapse of the economy took millions of jobs with it.

Kasich wants to do the same thing to Ohio. Yay!

Mr. Kasich, who held a “business roundtable” session in Lake Township on Tuesday, said the low ebb of the economy was made clear to him when he stepped out on the eighth floor of a downtown Toledo office building and saw nothing but vacant space.

“It was all empty, you know. The most important thing we can do here in this state is we’ve got to create a business-friendly environment so we can get some jobs,” he said.

Kasich says empty space is proof of tough times for city

A business-friendly environment is code for no regulations and no taxes – anything less than that doesn’t seem to work for him.

“I understand you have a very fine mayor here in Toledo, good guy, independent and all that, but he’s been saying he doesn’t like my program because I want to cut taxes. Well, how are we going to get anybody to come in here if we’re one of the highest-taxed states in the country?” Mr. Kasich asked.

Ohio has given away tax breaks like candy for decades. In fact major businesses in Ohio pay less income tax than many Ohioans. I wrote in a post in 2004:

Meanwhile the business inventory tax is being phased out, utility poll taxes were eliminated sometime ago, 81% of Ohio companies pay no more than $2000 a year in income tax, you are more likely to see tax breaks given to businesses for negligible requirements on their part, and Workers compensation taxes have been quite low for several years.

When it comes to community needs, Wachtmann and Gilb don’t care

That really hasn’t changed since then. The state has not added any income taxes and in fact had a 21% tax cut that was being phased in before the 2008 collapse forced the state to delay the last part of the cut. In 2008 Ohio’s corporate tax rate was 5.1% and yet the state is flirting with $8 billion dollars in red ink, cuts in dozens of programs and education among others.

In the current two-year budget, Strickland – and the General Assembly – reduced state general-fund spending by nearly $2 billion. In the previous budget, spending was cut by $1.5 billion.

CAMPAIGN AD WATCH: ‘Pulled’ – GOP anti-Strickland ad

As Strickland summed up Kasich as a candidate:

Bringing up Mr. Kasich’s claim that some 400,000 jobs were lost during his term, Mr. Strickland said, “what John Kasich and his cronies on Wall Street did was more responsible for job loss in Ohio than anything I’ve done.”

He said Mr. Kasich had voted as a congressman against a $1 billion veterans’ benefit targeted for treating head injuries and repeatedly voted for a bill to allow wealthy people to avoid taxes by renouncing their citizenship.

Strickland challenges Kasich to debate tax elimination plan

Strickland has it right. The so-called 400,000 job loss (really only 379,000 through June) was not Strickland’s fault. He also isn’t responsible for the Republican controlled Ohio Senate that offered no plan to balance the budget and tried to hold onto the final bit of that irresponsible 21% tax cut. He also isn’t responsible for banks holding their bail out money and not lending it out. Strickland isn’t responsible for the lack of sales keeping any recovery muted and he sure can’t force businesses to do anything in Ohio until the recession subsides.

Kasich doesn’t have any real solution to Ohio’s economic problems. They are much bigger than the Governor and simply “cutting taxes” isn’t going to work. If Kasich wins then Ohio will continue down the road of bad roads, worse education, and increased suffering of people not associated with the big banks like Kasich.

Kasich’s “business-friendly environment” plan is the same old same old screw regular people plan that a majority of Americans rejected in 2008 when they gave control of the national government to the Democrats. Why in the heck would we want that failed plan in Ohio.

Kasich is just wrong for Ohio. Not to mention he seems to have a short Mel Gibson type temper.

There really are two Americas

While writing about the current economic melt down, I’ve mentioned that the douchebags on Wall Street that ran the economy into the ground operated under different rules than what we regular Americans do. The fact that the bankers want the taxpayer to pay for their toxic assets for a value more than the paper they are written on should be a clue. Columnist David Sirota points out even a more obvious example and one that seems to have removed the rose colored glasses from the masses, who have acted like they’ve never noticed this before. His column talks about the foundation of business – the contract.

Last month, the same government that says it “cannot just abrogate” executives’ bonus contracts used its leverage to cancel unions’ wage contracts. As The Wall Street Journal reported, federal loans to GM and Chrysler were made contingent on those manufacturers shredding their existing labor pacts and “extract(ing) financial concessions from workers.” In other words, our government asks us to believe that it possesses total authority to adjust contracts at car companies it lends to, and yet has zero power to modify contracts at financial firms it owns. This, even though the latter set of covenants might be easily abolished.

A government of men, not laws

That’s right. Contracts to pay bonuses to the douchebags who ran the economy into the ground were off limits while there is nothing wrong in throwing out labor contracts as a condition for automakers to get a loan.

Sirota also mentioned this double standard applied to mortgages:

Congressional Republicans have long supported the laws letting bankruptcy courts annul mortgage contracts for vacation homes. Those statutes help the shower-before-work clique at least retain their beachside villas, no matter how many of their speculative Ponzi schemes go bad. But for those who shower after work, it’s Adams-esque bromides against “absolving borrowers of their personal responsibility,” as the GOP announced it will oppose legislation permitting bankruptcy judges to revise mortgage contracts for primary residences.

It was equally unfunny when some talking head on CNBC recently noted that you couldn’t get anyone to run the financial industry for less than $250,000 a year. He forgot that the ones making that cash didn’t do a good job of it either. That’s why they are trying to snooker us into a bad deal on those toxic assets.

What happens when rich elitists get to decide on a budget for all Americans? We get the Senate version of the stimulus bill. *sigh*

Well, this week, the political elites who live in the Senate decided that we didn’t need to help the states,. our schools, or our health. The Senate version of the stimulus plan, the one needed to keep this country from driving over a cliff, removed $86 billion dollars of spending that would’ve had an immediate effect in the country – money to the states and education. Yes, the bubble returns to Washington. Douchebags!

Some of the listed cuts in the Senate version include:

$40 billion State Fiscal Stabilization
$16 billion School Construction
$7.5 billion of State Incentive Grants
$5.8 billion Health Prevention Activity
$1 billion Head Start/Early Start
$2.25 billion Neighborhood Stabilization

What the Senate’s cut: Funds for states and schools

Or as Senator Claire McCaskill (D-Missouri) said on her Twitter: Proud we cut over 100 billion out of recov bill.Many Ds don’t like it, but needed to be done.The silly stuff Rs keep talking about is OUT.

Yes, funding the states and education is silly stuff….. classy!

Paul Krugman (remember – the guy who is actually an economist and who won a Nobel Prize) said in his New York Times column:

Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

What the centrists have wrought

And why did this happen? Krugman has an idea:

[C]entrism is a pose rather than a philosophy. And to support that pose, the centrists are demanding $100 billion in cuts in the economic stimulus plan — not because they have any coherent argument saying that the plan is $100 billion too big, not because they can identify $100 billion of stuff that should not be done, but in order to be able to say that they forced Obama to move to the center.

Appeasing the centrists

It is all about being bipartisan – you know where the minority party gets what it wants in full – even though they are in the minority. It’s the bizzaro Congress.

Meanwhile the Wall Street douchebags will be getting more money to spend on hookers and blow…. well does it really matter? They still don’t have any rules on the use of their bailout funds.

*sigh*

Why do Wall Street Bonuses cause complaints? It is simple math and common sense

Everyone knows about the bail out of the nation financial institutions after they risked too much on junk assets that failed to deliver. Most people also should know that after getting the tax payer funded bail out some of these same banks, investment houses, and insurance agencies used that money to pay billions of dollars in “bonuses” to CEOs and employees. Even though such pay outs look stupid and in this case they are, it isn’t because the workers may not deserve it but it is simple math.

Some business experts have tried to cast bonuses as commissions earned for sales. But again if there are no sales how can you justify a bonus. It is still simple math. If you have red ink on the books then you shouldn’t have any money to pay for bonuses.

The bigger question might be why there will be bonuses at all.

After all, even if bonuses fall 50 percent, that hardly matches the drop in profits and revenues plaguing Wall Street. At Lehman Brothers, the employees still left are expected to receive $3.5 billion in bonuses from the firm’s new owners, Barclays Capital and Nomura.

In a system where huge profits bring huge rewards and huge losses bring, well, smaller rewards, can you blame Wall Streeters for taking big risks in hopes of getting the brass ring?

Take a look at what happened to banks in 2007: Citigroup, for example, reported a profit of $3.6 billion, down 83 percent from the previous year. Many other firms saw similar declines. Yet bonuses across Wall Street declined only 4.7 percent from the year before. The payout was $33.2 billion, according to DiNapoli.

Open season on the Wall Street bonus

That’s why I get upset about Wall Street people like John Thain and others who still pay out bonus out of whack from reality.

I’ve been taught that bonuses are tied to the performance of myself and the company I work for, and all the places I’ve worked have done that it that way.

At my current job, there are certain benchmarks I have to meet in order to qualify for a monthly bonus and the size is set based on how I did, above that initial bar. The current maximum is 12% of my base pay if I hit 100% of all the benchmarks.

Our managers, on the other hand, get a bonus based on how all of us do in reaching certain goals for the company for that month.

At another job I worked, which was a retail company, bonuses were tied to the “Earnings Before Taxes” of the company. The amount you got depended on the percentage your department contributed to the EBT. At that job, I worked long enough to get one bonus and it was $600 after taxes. I still have the TV I bought with it.

The common wisdom is if you have lost money there should be no bonuses paid out. That’s why people are pissed off about Wall Street bonuses.

Rep. Jim Jordan clueless on Bailout issue

Jim Jordan cracks me up.

“It was a little bit surprising that we were able to prevail,” Jim Jordan (R-Urbana) said after the vote. He represents Ohio’s 4th District and was in Washington for the vote. Jordan, a Republican voted against the plan, which he said would have provided a government solution to a problem that would be best served by the free market. “I think members by the vote tally said loud and clear they want a different solution,” he said. “They want to do it the way America has always done it: with a free market, free enterprise solution.”

Jordan votes against rescue plan

I guess he isn’t aware how Wall Street got hold of those toxic assets. The Free Market!

Yes back in the 1990’s when the GOP was in charge they got rid of those nasty rules and regulations dating from the 1930’s. It was like giving booze and car keys to a teen and asking them to be safe….. and Jordan thinks the free market will help?

I feel bad for average people who will be really hurt if we just let the market collaspe. No credit, no money for growth, no money for new city projects, no money for school buildings etc….. if something isn’t done to bail out the frat boys on Wall Street.

I feel bad that Jordan and the GOP put themselves ahead of the country.