Boomers Disappoint Next Generation

A while back, a lovely young lady (very young…college aged) wrote to our local newspaper begging for real leadership from the adults running her world.  Here is my response…

Dear Ms. Scofield:

Since it is we Boomers who are the leaders right now, it is us who owe you the kind of thoughtful, quality leadership you so dearly want, and who have so disappointed you.

And ironically, you have asked of us the kind of leadership we asked of our leaders in our day.   It is our generation that began the environmental movement – “sitting-in” and demonstrating our little hearts out against “the man” and the status quo he represented (corporate greed, pollution, segregation, few rights for women – sound familiar?) when we were your age!

Yea us!

Except that once we became  “the man” we happily backtracked on all that we believed as youth: we have been the main polluters with our gas guzzling cars and 3 homes; we are the CEO’s of the companies that ran the economy into the earth’s core and made decisions based on fattening our wallets vs. caring for our customers/planet; we abandoned the equal rights bill  so women still make significantly less than men for the same job; we are many of the legislators unproductively growling dogma along strict party lines or to ensure our re-election rather than doing what’s best for the state/country and our legacy.  We are doing exactly what our leaders were doing that we so abhorred.

I am so very proud of you.  And I am so very disappointed by the failings of my generation after such a slam-bang start.

So you and your peers keep up the pressure – and add to it that no one knows better than Boomers what is needed to take care of our state and the world.  Remind us of that for which we once fought.  And don’t stop until we blush and capitulate.

It’s the least we can do after all these decades of betrayal to our roots.

What We Can Do to Keep This Great Obama Feeling Going

…and the beauty of my idea is its simplicity – note I didn’t say its ease… but it is quite simple.

Don’t be shrill.

You were McCain/Palin: it’s unfortunate your pick didn’t win; now get behind who did.

You were Obama (few really care about Biden….): that’s lovely but don’t gloat.

We want Obama to “not overreach,” the Democrats to “not let their increased majority go to their heads and and as result forward ideology rather than pragmatic solutions” and our national leadership to stop back-stabbing and start healing the body politick. 

None of this is possible with a shrill electorate.  Whether you believe it or not, your elected officials do, more often than not, follow your lead.  If you scream, they scream.  If you stay calm, determined and focused, they will, too.

Catch yourself overreacting, taking the election results as some sort of reflection on you personally (either “winner” or “loser”), fearmongering.

We have a huge role to play if this “new feeling of hope” we’ve clearly given the planet is to take hold and stay longer than a few months. 

Mr. Obama has led us to the well.  We decide whether we drink, or continue to thirst.

Top 6 Things President Obama Must Handle in the First 100 Days

We Boomers pretty much embody the nexus for the nation’s most pressing ills that must be made well if America is to once again be great.   As far-reaching as that sounds, it couldn’t be more true.

Using myself as an example, I am:

  • a business owner;
  • a mother of young adults in the work world;
  • a person who is nearing retirement;
  • a caretaker for elderly parents, and;
  • a person who is part of the generation that called for an end pollution and corporate bad behavior

These correlate to the following ills already identified as most pressing by voters and pundits alike (in order of appearance above):

  • Taxes and global trade laws
  • Job creation; adequate healthcare
  • Social Security & Medicare; retirement account capacity
  • ditto; plus Healthcare
  • Clean energy/energy efficiency

So, here is my guidance to our young and idealistic President Elect – the top 6 things to be handled in the first 100 days from a Boomer’s perspective:

  1. Economy: Ensure the proper handling of the immediate steps needed to begin meaningful economic recovery by seeking/receiving ideas from economists, not politicians, from both ends of the “how-to-fix-this” spectrum, then doing what falls in the middle-ground
  2. Healthcare: any form of “universal healthcare” is at best a long way off in this country (rightly or wrongly…) and at worst not going to happen at all in this country; ensure a first step response that will at least mitigate the outrageous costs of healthcare/health insurance, thus providing immediate relief that will go far to create a healthier populace (on which, after all, all else is dependent)
  3. Taxes: Immediately roll back or eliminate tax breaks for companies that cheat (off shore bank accounts to avoid taxes, for example), steal (eliminate jobs here in the US so their CEO’s can grab hundreds of millions of dollars in compensation), and pollute without care for the planetary result but to increase their bottom-line; rework the tax code to eliminate huge tax loopholes for those making over a certain amount (your cut-off of $250,000 is fine) so they are paying a fair ratio of income tax to income
  4. Social Security/Medicare: SS – move the cap at which SS deductions are taken, from the current $89K to $250K; Medicare – immediately establish a department that investigates/handles only Medicare fraud, as I can tell you from first hand experience that what we’re doing now is completely inadequate, and the money being greedily siphoned from this excellent program could pay for it and the department’s salaries, possibly 2X over
  5. NAFTA: do not eliminate this treaty, instead make it more effective and even-handed for all countries involved (including ours….)
  6. Job Creation through Clean Energy Sources (value added…Energy Independence): In addition to the aspects of #’s 3 & 5 above that will result in the creation of a certain amount of jobs, immediately invest in alternative energy projects and the job training needed to prepare unemployed/soon to be unemployed folks from last century industries, for those jobs.

And your foundation for all of this: Be unwavering on your determination that ideology will not trump reality, particularly within your own party.

My fellow Boomers and I were around in the heady days of the 60’s/70’s that America (if not the world…) is in process of reliving.  Unfortunately, we became “the Man” we so distrusted; we became the polluters and resource wasters we so derided; in essence, we got lost from our ideals, too busy making a living to remember the importance of sustaining life.

Do not get lost once in the Oval Office.  Keep your grounding.  Make sure that you and the youth you so inspire, don’t stop living your ideals as we did.

Build on our historic successes and don’t repeat our failures.  Then, maybe this time around America can finish what it started.

The Bail out…is a cop out

Why, you say, do I say that the wall street bail out, in essence, won’t work?  Here’s an excerpt from an article on this topic found in Money Morning, that explains it well.  To read the full article, go to: http://www.moneymorning.com/ppc/senate_agg.html?gclid=CKPn18iok5YCFQhdswodiCp_FA and subscribe.

Heads I Win, Tails You Lose: Why the Senate Bailout Bill Will Fail Taxpayers

 

In plain English, here’s what’s wrong with the proposed plan and what alternatives should be immediately vetted and constituted into a new plan.

The Treasury plan was originally predicated on buying $700 billion of collateralized residential mortgage-backed securities that banks could not unload. The idea was that the banks would get the money, which they could then turn around and lend to keep the credit markets open and credit flowing throughout the economy. In the meantime, the Treasury Department would sit on the securities until it is able to sell them, hopefully at a profit. The idea, from a theoretical standpoint,isn’t stupid. It is, however, impossible to implement to any degree that will result in its intended effect.

Here’s why:

  • There are more than $1 trillion worth of subprime collateralized mortgage-backed securities out there – and that’s just one type of problematic derivative security. The bottom line: $700 billion isn’t enough. Period.
  • The purchase plan is not limited to just residential mortgage-backed securities. Surprise! What else will Treasury buy?
  • Who’s going to fight off the lobbying groups out to influence the managers that the Treasury Department hires to direct money to their masters? Did we mention that $700 billion wasn’t enough?
  • The government plan is even more under-funded than people realize, for it doesn’t authorize the full $700 billion: Indeed, it starts with only $350 billion, leaving an even greater shortfall. Did we mention that $700 billion wasn’t enough?
  • Treasury is going to hire banking-industry managers to manage the process. Those managers are going to serve themselves – just as they served themselves to get us into the crisis.
  • There is no defined mechanism to determine what price the Treasury Department will pay for what it buys. For argument’s sake, even if Treasury were to only buy the problem securities its leadership speaks of in public – residential mortgage-backed securities – there are problems if it prices them too low: If that happens, some holders won’t sell them, taking the chance that if they hold them long enough they will be worth more than Treasury is willing to pay. How will those financial institutions regain liquidity if they won’t sell the securities needed to make this happen?
  • Since Treasury can’t buy all the problem securities, if it prices what it’s going to buy too low, all remaining holders will have to mark down their holdings and take more write-downs and losses. How will that create confidence and facilitate “liquidity”?
  • However, if the Treasury Department prices the securities too high, several problems quickly emerge: Hedge funds will rush to sell their current holdings, and may very well speculate by buying up more securities to sell them at a higher price (profit) to Treasury, meaning that the Treasury Department plan won’t necessarily be helping banks directly. What’s more, if those securities are priced too high, and the market for them continues to fall, taxpayers will eat the losses – a reality that likely will lead to an end to further program funding.

While the idea that taxpayers should get warrants and ownership in the entities that we buy securities from is theoretically a good idea, there are some issues. Let’s take a look at some of the biggest potential pitfalls:

  • Foreign banks aren’t going to be thrilled about that; yes, they are included in the list of whom the Treasury will buy from.
  • Are taxpayers going to be limited partners in hedge funds? What if those hedge funds implode?
  • The U.S. Treasury Department could end up in control of our banks. Considering how well they run the government’s fiscal house, is that what we want?
  • Who is going to decide when to sell any of government’s ownership interests, should they turn out to be profitable? Will we own these businesses forever?
  • Is government going to control private enterprise? Is this a ruse? Are we heading into an era under the stewardship of a socialist government?
  • There is no direct support for homeowners in the plan and no support mechanism for falling home prices. And yet, these twin evils are the root causes of what has happened.

This Boomer's Idea of the Perfect Bail-out Package

The sky is falling, the sky is falling!!!!

 

Or, more accurately:

 

The stock market’s crashing, the economy’s tanking!!!

 

The former, I think, is true only in that as we continue to pull lots of carbons out of the ground and spew them into the air, the sky falls ever closer to levels of damage beyond repair in this century.

 

The latter, I think, is more a matter of melodramatic, histrionic thinking seeded by failed but still very powerful bankers/corporations who don’t want to be held fully accountable for their bad behavior and exceptionally poor business practices like they will be if they have to handle this all by their weeny little selves.   They know that a “bail-out” will save their beautifully-clad asses and shield them from losing their personal shirts. 

 

They also know that the alternative will NOT cause the economy to collapse albeit the process won’t be pretty, for sure, but WILL force them to face and deal with the collossal pig-sty they created (my apologies to pigs…), with all the lost compensation that goes with it.  Over 200 very credible, highly regarded economists and scholars agree: this mess might get a little ugly, but will work itself out without one penny of government “bailing” money.

 

Finally, they are banking on (pun intended) the demonstrated m.o. of Americans these days, led by we Boomers (and unlike our parents); that we are not much for sacrifice on any level, are driven by the need for immediate gratification regardless of its long-term consequences, and therefore we will fall for anything that will keep us from the pain associated with atoning for our own glaring mistakes (making unabashedly bad if not somewhat greedy decisions to take on mortgages we couldn’t afford, with incomes that didn’t warrant the amount we borrowed, gambling on a big pay-off in a few short years as though our homes were a mini Vegas….).

 

Are they right?  Well, so far, they’ve completely underestimated the American public.  One point for us!

 

But the “bail-out” package is still worming it’s way through Congress (having at this writing won support in the Senate and now on its way to the House), and given Congress’ indebtedness to the bail-outees, will most likely pass.  One point for the bankers.

 

So, given that we Americans have a poor track record of holding our representatives closely accountable for their actions/lack thereof, an equally poor propensity for voting at all let alone voting anyone out of office for glaringly self-promoting performances, and our representatives’ certainty of this, what we want at this point really doesn’t matter. 

 

I guess you know that by now, given that an overwhelming majority of Americans are against the bail-out and it’s going to happen anyway.  Congress’ justification: we’re just too uninformed (read stupid) to know what’s really best for ourselves…and I have to admit they have a point as it relates to who we’ve chosen through our own apathy as our government leaders….  But they’re more than willing to accept our exceptional thinking prowess when we do vote and cast one for them, so I guess that’s where our brain power really lies…(?!)

 

Anyway, back to the bail-out.  Since it will happen, here’s a list of revisions to the provisions that I recommend Boomers insist upon when (and I hope it won’t be “if”) you call your Congressman today and tomorrow morning:

  • The amount not be a flat $700B with a phase-in component ( we know from experience that they will spend it all, and more…), but instead be authorized for only the first “phase in” amount of $250B: anything thereafter must be subject to Congressional vote, just like this was;
  • The “requirement that the Treasury Dept. make rules to prevent excess executive compensation” have a specific time-line by which that report will be due; the same goes for the President’s “established plan to recoup the cost from the financial industry if, after five years, there are any losses”;
  • “Cap deductibility of executive’s pay packagesfor firms that get $300M or more from the program…”?! I DON’T THINK SO….  Cap executive compensation period, at $500K for firms who get any bail-out money whatsoever
  • Oh, and the whole idea of raising the FDIC guarantee amount to $250,000 from the current $100K?  That is simply a ploy to get some folks to vote for this package.  It is not something that will ultimately benefit any more than 5% of Americans (personal or business), and it will simply increase what we’ll have to “bail out” when banks behave badly again…and I promise you, without serious regulation/oversight, they will – their historical track record proves it.  Eliminate this provision;
  • As for the ever-present and quite predictable throwing-in of all sorts of items that have nothing to do with the activity of “bailing” – inasmuch as I agree with most of them, particularly insurance coverage parity for mental illesses to physical ones, and tax breaks for clean, home-grown energy alternatives, they have no business in this bill and need to be handled separately, where they belong.

Well, that’s it, guidance from your Boomer Coach, whose job it is to provide you with all the relevant information you need to make a fully informed decision, do the research/compile the facts to that end, and be completely honest with you even when some of that feed-back isn’t a happy meal.

 

I’m Terri Benincasa, and I wrote this message.