23 September 2008

Viva la Bailout!

Some light entertainment below, courtesy of the pinstripe neosocialists in the White House and on Capitol Hill.

This is the actual draft text of the bailout plan -- a text which says all you ever needed to know about how totally these Goldman Sachs statists fail to understand the "economic freedom" they love only as long as they can rig it.

Notice, for example, how the Treasury Secretary is granted powers (no expiration date included) to spend $700,000,000,000 and to perform other astonishing feats, all in ways "non-reviewable and committed to agency discretion" and that "may not be reviewed by any court of law or any administrative agency."

Notice also that the Secretary, in executing this most exhilarating and very patriotic shopping spree, is committed to "take into consideration means for (1) providing stability or preventing disruption to the financial markets or banking system; and (2) protecting the taxpayer."

So, having taken these noble points "into consideration", I dearly hope that our beloved and tirelessly self-sacrificing Secretary will at least reward himself -- perhaps after spending the first $100,000,000,000 -- by using some of his ever-expanding "discretion" to treat his family and himself to a nice residence or two in the hills over Honolulu.

Like our dear Lenin after a hard day's work, he'll have earned it.

Text of Draft Proposal for Bailout Plan

LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY

TO PURCHASE MORTGAGE-RELATED ASSETS

Section 1. Short Title.

This Act may be cited as ____________________.

Sec. 2. Purchases of Mortgage-Related Assets.

(a) Authority to Purchase.--The Secretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Secretary, mortgage-related assets from any financial institution having its headquarters in the United States.

(b) Necessary Actions.--The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:

(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;

(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts;

(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;

(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and

(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.

Sec. 3. Considerations.

In exercising the authorities granted in this Act, the Secretary shall take into consideration means for--

(1) providing stability or preventing disruption to the financial markets or banking system; and

(2) protecting the taxpayer.

Sec. 4. Reports to Congress.

Within three months of the first exercise of the authority granted in section 2(a), and semiannually thereafter, the Secretary shall report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate with respect to the authorities exercised under this Act and the considerations required by section 3.

Sec. 5. Rights; Management; Sale of Mortgage-Related Assets.

(a) Exercise of Rights.--The Secretary may, at any time, exercise any rights received in connection with mortgage-related assets purchased under this Act.

(b) Management of Mortgage-Related Assets.--The Secretary shall have authority to manage mortgage-related assets purchased under this Act, including revenues and portfolio risks therefrom.

(c) Sale of Mortgage-Related Assets.--The Secretary may, at any time, upon terms and conditions and at prices determined by the Secretary, sell, or enter into securities loans, repurchase transactions or other financial transactions in regard to, any mortgage-related asset purchased under this Act.

(d) Application of Sunset to Mortgage-Related Assets.--The authority of the Secretary to hold any mortgage-related asset purchased under this Act before the termination date in section 9, or to purchase or fund the purchase of a mortgage-related asset under a commitment entered into before the termination date in section 9, is not subject to the provisions of section 9.

Sec. 6. Maximum Amount of Authorized Purchases.

The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time

Sec. 7. Funding.

For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.

Sec. 8. Review.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

Sec. 9. Termination of Authority.

The authorities under this Act, with the exception of authorities granted in sections 2(b)(5), 5 and 7, shall terminate two years from the date of enactment of this Act.

Sec. 10. Increase in Statutory Limit on the Public Debt.

Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof $11,315,000,000,000.

Sec. 11. Credit Reform.

The costs of purchases of mortgage-related assets made under section 2(a) of this Act shall be determined as provided under the Federal Credit Reform Act of 1990, as applicable.

Sec. 12. Definitions.

For purposes of this section, the following definitions shall apply:

(1) Mortgage-Related Assets.--The term “mortgage-related assets” means residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before September 17, 2008.

(2) Secretary.--The term “Secretary” means the Secretary of the Treasury.

(3) United States.--The term “United States” means the States, territories, and possessions of the United States and the District of Columbia.

21 September 2008

American myths remembered

By Eric Jansson
Published by Financial Times, 20 September 2008

To begin to understand how tenuous modern America’s grip is, physically, on the West once won, you only need to drive east from Los Angeles.

You go from the sprawling city, all asphalt and lawn sprinklers, through outlying areas dustier and more ramshackle by the mile, and before long the desolation of genuine desert. In under 90 minutes, you pass from a metropolis into a wilderness where nature’s inhospitality seems to militate against human habitation.

We left without a plan, just an outline: seven days in the desert and a rented Chrysler, our toddlers buckled into the back.

The American frontier is mythic, but it is no myth. It has been updated over the past century – horses traded for cars, gaslight for electricity, wooden planks for corrugated metal sheeting – and made more habitable by air conditioning. But it endures, not far from where people have forgotten it.

We first reached the frontier in a little roadside town just a couple of hours from Los Angeles, near the spectacular Joshua Tree National Park. Next door to the jail, a shop advertised “Bail Bonds, Open 24 Hours”. And not much else.

Such settlements look terribly precarious, as if a big wind could blow them away, and the New World would be virgin again, unknown to humankind. Yet the further we drove into the desert, eventually covering 2,500 miles in seven days, the more we discovered this impression was wrong.

The ancient, huge, weatherworn landscapes surrounded us, preaching continuity from the primeval to the present day. But vacant, unpeopled continuity this was not: 400 miles from Joshua Tree, we visited Saguaro National Park to see the iconic cacti. Striking as the cacti were, far better were the petroglyphs we found atop a rattlesnake-infested pile of boulders. Rock drawings, they were made by the Hohokam people, an agriculturally adept civilisation that flourished here 1,200 years before Columbus “discovered” America.

A sign suggested we look down from that boulder pile, to survey the giant valley below and imagine a patchwork of Hohokam farmers’ fields. If the sign is correct, humankind is less populous in the valley today than it was a millennium ago. This was the first of many startling reminders that the Old West of popular myth was never genuinely old. It was just early modern.

Frontier myths crowd the landscape, with white gunslingers and prospectors winning the hearts of some, and native nations attracting the sympathy of others, while forgotten ancients such as the Hohokam ask us to consider different narratives.

Contradictory myths do not mix neatly. We got a taste of this at Saguaro National Park’s splendid visitors’ centre. The film that welcomes visitors to the park suddenly launches into a telling of local O’odham spiritual traditions. Native religion gets spliced into a script that otherwise belongs wholly to modern America. The jarring edit, an attempt at balance, only reminds us who won the West and who lost it.

Less nuanced takes on the southwest, on whomever’s side, come off more successfully. In the old ghost town of Tombstone, for example, we found the unadulterated gunslinger myth in full commercial bloom. Tombstone tips its 10-gallon (hat) almost crassly to just one version of a deeply complex history, yet it was irresistibly fun.

South of Tucson, we came across the amazing 17th-century mission of San Xavier del Bac – a place unknown even to most devotees of the south-west.

In the joyously colourful mission church, one sees how the Tohono O’odham followers of Father Kino, a Tyrolean missionary who went to Bac in 1692, embraced the iconographic traditions of Rome as folk art. The church is crammed with visions simultaneously profound and na├»ve – a Baroque masterpiece in adobe and wood, set on the Arizona sand.

The church has meant much to the Tohono O’odham over the years, yet the scene around it felt strained. Next to the parking lot sat 20 or so members of the tribe. Slow-moving, speechless and bundled in blankets, they sold soft drinks and “Indian tacos”. We bought lunch and moved away, fleeing the wasps swarming around the stoves but also, frankly, the vendors who silenced us with a blank aversion to conversation.

We reached Chiricahua National Monument, deep in the wilderness, in the late afternoon. This astounding park of echoing canyons, bizarre rock formations and 60-mile vistas was the ancient home of the Chiricahua Apache nation, the people of Geronimo, whose long, bitter war against US federal troops, ending in 1886, was one of the last gasps of native American resistance. We had reached the heart of ancient Apache territory, a maze of hiding places, the guerrilla warriors’ base from which Geronimo and the Chiricahua, once defeated, were exiled.

We hiked to a lookout. Across a canyon, on a craggy ridge, we saw a natural formation resembling the profile of Cochise, a warrior chief who came before Geronimo. Our two-year-old son yelled out into the canyon. His shrieks echoed back like avian chatter.

There was no evidence of another soul in the immense park, yet I felt more exposed than alone. Dusk closed in on us. The silhouetted rocks appeared like human figures, marching purposefully out of the canyon.

Bound for some New Mexican motel, we drove into a black desert landscape devoid of man-made light. Turning out of the park, our headlights flashed over a herd of pronghorn antelope.

When we crossed a cattle grid at speed the car shuddered violently and somehow this caused the electrics to fail. The windows danced madly up and down. Cold night air blasted into the car. Alarmed, I braked sharply and turned off the engine, now spooked myself.

For a moment I felt desperately far from civilisation. I felt the size of the land, the unplumbed depth of its past and my vulnerability within it.