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Angry Bitter Liberals

— Adam Levine of the band Maroon 5

Twitter user “Brock Boehlert” retorts: “Hey @adamlevine how much did you make from Fox when ‘Harder To Breathe’ was used on American Idol?”

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From CNBC:

Someone affiliated with the Department of Energy has been going back to make changes to press releases posted on the Internet weeks and months ago, CNBC has found.

The changes occurred in two press releases from the Department of Energy’s loan guarantee program.

Both were changed to remove the name of a company that has received negative press attention in recent days, SunPower, and replace it with the name of another company, NRG Energy.

In the April case, the Department of Energy loan programs office announced in a press release on April 12 “conditional commitment” to a $1.187 billion loan guarantee to support the California Valley Solar Ranch project, which it said was “sponsored by SunPower Corporation.”

But that release was later changed on one website to say the project was “sponsored by NRG Energy.” The date on the release remained “April 12, 2011.”

In a second instance of retroactive press release revision, someone changed a release from September 30 that announced the finalization of the California Solar Generation project. In an early version of the September 30 press release, the government said the project was “sponsored by SunPower.” That was later changed to “sponsored by NRG Energy.”

In a statement, a spokesman for the Department of Energy said that the changes were made by outside contractors for the department responsible for maintaining the Loan Programs Office website.

“The only website that changed was a separately maintained loan program webpage that is managed by support services contractors,” the spokesman said. “While updating the project fact sheet to reflect the changes in the ownership of the California Valley Solar Ranch project, those contractors inadvertently changed the news bulletins posted on the LPO website.”

UPDATE: On Wednesday evening, a Department of Energy spokesman said that the press releases had been returned to their original content as a result of CNBC’s inquiry about the changes.

 

The Government Accountability Office has just completed its second audit of the Federal Reserve. The report, a summary available here, focuses on “the enormous conflicts of interest that existed at the Federal Reserve during the financial crisis.”

Some of its findings:

  • The affiliations of the Federal Reserve’s board of directors with financial firms continue to pose “reputational risks” to the Federal Reserve System.
  • The policy of the Federal Reserve to give members of the banking industry the power to both elect and serve on the Federal Reserve’s board of directors creates “an appearance of a conflict of interest.”
  • The GAO identified 18 former and current members of the Federal Reserve’s board affiliated with banks and companies that received emergency loans from the Federal Reserve during the financial crisis including General Electric, JP Morgan Chase, and Lehman Brothers.
  • There are no restrictions on directors of the Federal Reserve Board from communicating concerns about their respective banks to the staff of the Federal Reserve.
  • Many of the Federal Reserve’s board of directors own stock or work directly for banks that are supervised and regulated by the Federal Reserve. These board members oversee the Federal Reserve’s operations including salary and personnel decisions.
  • Under current regulations, Fed directors who are employed by the banking industry or own stock in financial institutions can participate in decisions involving how much interest to charge to financial institutions receiving Fed loans; and the approval or disapproval of Federal Reserve credit to healthy banks and banks in “hazardous” condition.
  • The Federal Reserve does not publicly disclose its conflict of interest regulations or when it grants waivers to its conflict of interest regulations.
  • 21 members of the Federal Reserve’s board of directors were involved in making personnel decisions in the division of supervision and regulation at the Fed.

The GAO included several instances of specific individuals whose membership on the Fed’s board of directors created the appearance of a conflict of interest including:

Stephen Friedman, the former chairman of the New York Fed’s board of directors.

During the end of 2008, the New York Fed approved an application from Goldman Sachs to become a bank holding company giving it access to cheap loans from the Federal Reserve. During this time period, Stephen Friedman, the Chairman of the New York Fed, sat on the Board of Directors of Goldman Sachs, and owned shares in Goldman’s stock, something that was prohibited by the Federal Reserve’s conflict of interest regulations. Mr. Friedman received a waiver from the Fed’s conflict of interest rules in late 2008. This waiver was not publicly disclosed. After Mr. Friedman received this waiver, he continued to purchase stock in Goldman from November 2008 through January of 2009. According to the GAO, the Federal Reserve did not know that Mr. Friedman continued to purchases Goldman’s stock after his waiver was granted.

Jeffrey Immelt, the CEO of General Electric, and board director at the New York Fed
The GAO found that the Federal Reserve Bank of New York consulted with General Electric on the creation of the Commercial Paper Funding Facility established during the financial crisis. The Fed later provided $16 billion in financing to General Electric under this emergency lending program. This occurred while Jeffrey Immelt, the CEO of General Electric, served as a director on the board of the Federal Reserve Bank of New York.

Jamie Dimon, the CEO of JP Morgan Chase and board director at the New York Federal Reserve

Dimon served on the board of the Federal Reserve Bank of New York at the same time that his bank received emergency loans from the Fed and while his bank was used by the Fed as a clearinghouse for the Fed’s emergency lending programs. In March of 2008, the Fed provided JP Morgan Chase with $29 billion in financing to acquire Bear Stearns. During this time period, Jamie Dimon was successful in getting the Fed to provide JP Morgan Chase with an 18-month exemption from risk-based leverage and capital requirements. Dimon also convinced the Fed to take risky mortgage-related assets off of Bear Stearns balance sheet before JP Morgan Chase acquired this troubled investment bank.

You can read the the full GAO report here.

James Sinclair finds commonality.

.

Bailouts, subsidies, tax breaks, special rights and privileges, regulations designed to restrict competition—to name a few of the many ways the government protects and stimulates corporate interests, and those things are every bit as anti-free market as, not to mention directly related to, the high taxes and excessive bureaucracy that gets Tea Partiers riled up. In other words, aren’t these two groups—Occupy Wall Street and the Tea Party—raging against different halves of the same machine?

Plus this:

It’s a myth that big corporations are anti-government, right? They don’t want to have to compete in a free market, they want to “compete” in an artificially restricted market.

Read the whole thing.

Those wacky Californians are at it again, launching into their cap and trade program tomorrow to battle global warming.  Great timing, as The Wall Street Journal posts two headlines tomorrow:

“Japan Reconsiders Plan to Cut Carbon Emissions”

and

“EU Weighs Pullback on Cutting Emissions”

Steven Hayward comments.

 

So says Jon Huntsman:

More than three years after the crisis and the accompanying bailouts, the six largest American financial institutions are significantly bigger than they were before the crisis, having been encouraged to snap up Bear Stearns and other competitors at bargain prices. These banks now have assets worth over 66% of gross domestic product—at least $9.4 trillion, up from 20% of GDP in the 1990s. There is no evidence that institutions of this size add sufficient value to offset the systemic risk they pose.

The major banks’ too-big-to-fail status gives them a comparative advantage in borrowing over their competitors thanks to the federal bailout backstop. This funding subsidy amounts to roughly 50 basis points, or one-half of a percentage point in today’s market.

Read the whole thing.

The whole purpose of a flat tax, à la 9-9-9, is to lower marginal tax rates and simplify the tax code. With lower marginal tax rates (and boy will marginal tax rates be lower with the 9-9-9 plan), both the demand for and the supply of labor and capital will increase. Output will soar, as will jobs. Tax revenues will also increase enormously—not because tax rates have increased, but because marginal tax rates have decreased.

By making the tax codes a lot simpler, we’d allow individuals and businesses to spend a lot less on maintaining tax records; filing taxes; hiring lawyers, accountants and tax-deferral experts; and lobbying Congress. As I wrote on this page earlier this year (“The 30-Cent Tax Premium,” April 18), for every dollar of business and personal income taxes paid, some 30 cents in out-of-pocket expenses also were paid to comply with the tax code. Under 9-9-9, these expenses would plummet without a penny being lost to the U.S. Treasury. It’s a win-win.

But what about the poor?

A static revenue-neutral tax change requires static winners and losers. And this 9-9-9 plan has made certain that even on static terms those below the poverty line will be better off—period. Once the dynamics take hold, many of those below the poverty line will find good jobs and thus will rise above the poverty line and start paying taxes.

We’ve seen this philosophy before:

While the 9-9-9 plan has captured people’s imaginations at this moment, it’s not all that different from California Gov. Jerry Brown’s 13% flat tax when he ran for president in 1992. As you may recall, he came in second behind Bill Clinton in the Democratic Party primary.

In 1986, President Reagan passed a major tax-reform bill that lowered to 28% from 50% the top marginal personal income tax rate. The Tax Reform Act of 1986 also raised the lowest marginal income tax rate to 15% from 11% and closed many loopholes, making for a flatter tax structure. Reagan’s bill passed the Senate in a landslide 97-to-3 vote. Who says a flat tax can’t be a bipartisan proposal?

But many argue that elected officials can merely raise the 9% sales tax:

What they miss is that any tax could be instituted in the future at a higher rate. If I could figure a way to stop future Congresses from ever raising taxes I’d do it every day of the week and twice on Sunday. Until then, let’s not make the perfect the enemy of the good.

And finally:

This is the type of tax increase I wholeheartedly support. I support collecting more in taxes from people with high incomes who choose to actually pay taxes at lower tax rates than use lawyers and accountants to avoid taxes at higher tax rates. Some tax revenues at low tax rates is a heckuva lot better than no tax revenues at high tax rates.

Read the whole thing.

UPDATE:  Don Surber comments:

My doubts about the efficacy of Herman Cain’s 9-9-9 plan were eased when economist Arthur Laffer wrote a piece in the Wall Street Journal vouching for it. The key components are two things I like: eliminating most of the $1 trillion in tax deductions and tax credits. Hooray. The IRS tax code is socialistic and corrupt as politicians use its intricate and Byzantine system of deductions and tax credits to wield power, control the economy and pocket contributions (and even more, do-nothing jobs for relatives) from fatcats. Herman Cain’s plan would flush out the sewers of Congress and the White House.

Plus this:

Conservatives have wanted to simply the tax code for some time. This plan would do so, but it would also turn taxation toward it should be: On consumption and not production. If you tax that which you want to reduce, then why tax income? We should tax consumption. An economy based on consumption is limited. The American economy from the post-Civil War era up until the Great Society was based production. Since then we have done much navel-gazing. It’s time to get back to work, America.

If 9-9-9 is what it takes to do that, let’s get ‘er done.