Archives for the month of: October, 2008

This past Saturday (10/18) marked Michael’s 6 month birthday. No infant’s birthday is complete without a trip to the doctor to get weighed, measured, poked, etc.  Michael’s still in the 50th percentile for height, but he dropped from the 75th to the 50th for weight.  If it weren’t for his over-sized brain (head circumference = 80th percentile), he’d be exactly average.  Who wants an average child, though? Not us, especially if our kid is smarter than most.

Thanks to his intellectual prowess, Michael is capable of doing things most kids his age couldn’t even dream of doing. The videos and pictures below will show you what we mean.

Crawling

Talking & Whistling

Yoga

Meditating

With all the talk in the news about Sarah Palin’s disinterest in world affairs, as illustrated by her not getting a passport until she was in her early 40’s, we decided the surest way to help Michael’s political future was to get him a passport, NOW. Today we had his picture taken, and in a few weeks we should have his passport.

Today I came across a blog that linked to this article by Dean Baker, the co-director of the Center for Economic and Policy Research. I don’t normally take the time to comment on blogs, but since I strongly disagreed with Mr. Baker’s point of view, I made an exception. Below is the comment I left that summarizes some of my thoughts on the financial Rescue Plan being debated in D.C.

Overall I think a well-structured plan is far better than letting the market take its course, but I’m still researching and formulating my opinion on this issue. Please feel free to leave your thoughts, especially if you disagree. Or, if you’re like me and don’t take time to comment on blogs, you can just make fun of me for how naive I am behind my back. The choice is yours.

Enjoy.

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Interesting article, but I disagree. Like many who oppose the Rescue (not bailout) Plan, Mr. Baker espouses a very appealing populist notion that the plan rewards unethical capitalists whose greed has got them into this predicament. In his conclusion he states,

“In short, the bailout rewards some of the richest people in the country for their incompetence”

While this statement undoubtedly resonates with millions of Main Street taxpayers, it is simply not true. What’s more, it engenders a class warfare mentality where the “little people” want nothing more than to stick it to the corporate fat cats.

It’s undeniable that greed and unethical behavior were huge contributors to the sub-prime mortgage debacle, which is now wreaking havoc on the markets. To the degree that the executives and employees of the Wall Street firms and banks engaged in fraudulent activities, they should be punished. No one would argue with that.

The evil doers must be ousted and the corruption must be cleaned up. And the great thing is, we can do that at the same time as helping out these COMPANIES. It’s not the executives that will be rescued. Under the plan the funds will be used to buy the devalued securities from these COMPANIES, and there will most likely be some strings attached to those funds (e.g. the government requiring AIG to replace their CEO as a condition of the $85 billion loan).

We should not allow the proverbial “chips fall where they may” in this situation. Like it or not, the now demonized Wall Street firms and major banks play a vital role, not only in the U.S. economy, but also in the global economy. No one can predict what the impact would be if these firms fail, but it would likely be far greater than what Mr. Baker suggests and exceedingly more damaging to the little people than the fat cats. We can’t allow class warfare, or an unyielding commitment to certain political ideologies (e.g. free market economy), keep us from taking prudent steps to help mitigate the consequences of this crisis.

Don’t get me wrong, I’m as unexcited as the next guy about the government using my tax dollars for this plan. In theory I’m strongly opposed to the government intervening with the markets, but the reality is we don’t live in a completely free-market economy. Two of the biggest culprits in this financial crisis are Fannie Mae and Freddie Mac, quasi-governmental agencies who made a market for sub-prime mortgage. While the proposed bailout would be a big interference in the free-market, it most certainly isn’t the first time the government has ever stepped in to assist a company (e.g. Chrysler) or an industry (e.g. farming), and it won’t be the last.

Two points in conclusion:
1. The final bailout plan will be far from perfect, but if it contains some key provisions – specifying how the government will determine the price it will pay for the devalued securities, reforming of Fannie and Freddie, suspending FAS 157 (mark-to-market) accounting, etc. – I’m for it. In my view it will be far better than stepping back and letting the market take its course.

2. I am more than a bit skeptical of Mr. Baker’s views on this issue and others. As a guy who has written books entitled, “The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer” and “Social Security: The Phony Crisis”, he appears to have his own political axe to grind. He may not be the most objective source to site on this issue.