The State of California this week began hitting up it’s tax base for Payday loans. A little discussed change embedded in the crisis budget the State passed allows California to raise state withholding to 10%. This isn’t a tax increase though. Oh no, it’s a short term loan. California will refund your money in your tax return. Sure they will. They expect to pull $1.7 billion into the State Treasury thereby making California appear solvent (as if), and giving the state “wiggle room” during their current financial meltdown. All I can say is Kvatch and I got out in the nick of time. So long suckahs!
Back in March of 2008, I started the Blogs Against Kleptocracy series with a post about industries imposing ‘nonsense taxes’ on consumers, taxes that compensate an industry for either failing to make money or failing to adequately address fundamental changes to their business model. And to illustrate the point, I made up some examples of nonsense taxes including this:
Big Coal will lobby for a ‘green tax’ that compensates them for revenue lost due to consumers switching to green power generation, buying energy efficient appliances, and turning off lights. Reduce your electricity consumption by 20%, and BANG! the tax kicks in.
At the time it seemed like a joke, but a year later Xcel Energy is proposing just such a tax—in this case a fee for customers who have the temerity to install solar panels, cutting their energy consumption or eliminating it entirely. Don’t use enough of Xcel’s energy, and bang the fee kicks in. And to add insult to injury, Xcel describes this as a way of ‘leveling the playing field’ for their non-solar customers, arguing that solar customers are getting a ‘free ride’. Despite the fact that no non-solar Xcel customer pays extra to fund anything having to do with solar energy redistribution or energy efficiency incentives.
So now, in the Kleptocracy that this country has become, consumers will progressively be penalized for not consuming.
So-called ‘Payday Loans’ are one of the most pernicious, most destructive forms of lending. Pushed by an industry that preys on low and moderate income Americans, these loans can often be found with rates equivalent to over 400% annually. And just in case you’re wondering how that stacks up to common usury law in the United States… Of the states that have a defined limit, the most generous is Colorado’s at a comparatively puny 45%.
Now, after dumping millions of dollars of contributions on key congressmen, the payday loan industry is about to get a gift in the form of competing bills drafted by Luis Gutierrez (D IL), the ranking Democrat on the House Financial Services Subcommittee and Joe Baca (D CA). Gutierrez’ legislation will for the first time codify in federal law general limits on payday lending, although at an income crushing 391% APR.
Ironically the Payday industry opposes Gutierrez’ ‘bad-cop’ routine on the grounds that restrictions on suing and garnishing the wages of unlucky borrowers will ‘destroy’ their business. So the industry is supporting Baca’s ‘good-cop’ attempt to take regulatory power away from the states. In fact, Baca’s bill will not only supersede existing state limits on interest rates but will pave the way for payday lending in states where it’s not currently feasible.
In short, these two congressional ass-wipes are making it possible for a predatory industry to enrich themselves mightily during the the worst recession that most Americans have ever experienced—shining examples of the Corporate Kleptocracy in action.
Q: Why did the AIG execs return approximately 30% of the multi-million dollar payout that they got straight from taxpayers?
A: To keep their identities secret. (And here we all were thinking that they might actually feel guilty for fleecing their fellow citizens.)
(Had this thought yesterday morning, but didn’t post. Now Reuters has confirmed that enlightened self-interest apparetly rules over all.)
If you played by the rules—invested like a good little drone, didn’t over-extend yourself during the real estate bubble—the kleptocrats that run our government guided by the corporatists who really call the shots, are about to f*ck you as you’ve never been f*cked before.
Did you think that the biggest wealth transfer mechanism ever conceived, the Iraq War with it’s direct and indirect payments to the defense and energy industries, was the end-game? Think again. Bu$hCo has been planning the “real end-game” for probably 2 to 3 years.
As with the Patriot Act, rushed through Congress with no review or meaningful debate, the administration is poised to slam a $700B+ bailout of those who created the current financial mess, right down the throats of the those of us who had nothing to do with it. In other words, Bu$hCo wants the ability to take your money and give it straight to ailing Wall Street firms—robbing the poor to pay the rich. And…once we’ve given our permission, it can never be revoked because that’s the way BU$HCO WROTE THE F*CKING LAW!
“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.”
Oh…and this act is no longer just about the Treasury Department dealing with bad mortgage debt. Nope, the “Sunday surprise” expanded Bu$hCo’s demand to include any debt the government chooses to acquire.
Some things to keep in mind.
- Democrats won’t help us. As Glenn Greenwald put it, “When it comes to things the Bush administration wants, Congressional Democrats don’t say ‘no’ to anything. They say ‘yes’ to everything. That’s what they’re for.”
- The Wall Street firms that created the mess will be allowed to walk away. They will not be punished. Not one penny of their unprecedented profits will be used to ameliorate the huge burden being shifted to ordinary citizens …
- … Moreover, there is no reason Wall Street should not go right on concocting complex, high-risk financial schemes. They know that as soon as those schemes collapse, the US Government will step in to make them whole. You and I will be the ones left holding the bag, whether we play or not.
- If you’ve had any doubts that we’re living in a Corporate Kleptocracy, where the government works hand in hand with corporations to ensure that wealth is transferred to those who already have it, you need not doubt it any more.
For 8 years this crisis has brewed, and Republicans have made sure that nothing was done to stop it. For 4 years Democrats have had the power to take action on their own, and not only haven’t they done anything, they’ve rubber-stamped every initiative that Bu$hCo has handed them. Now, with the chickens coming home to roost, a plan to give the government unfettered authority to use your money to make the gamblers whole, magically appears?! How can anyone truly believe that this wasn’t the plan all along?
Sit back and enjoy the end-game. It’s entirely out of our hands now.
Oil’s sharp retreat in the last two trading sessions on the world commodity markets has revealed what everybody already suspected: The speculators are leaving the field having already made a bundle-o-cash.
Investors, like locusts, are opportunistic. They also move in swarms, descending on whatever is unprotected and likely to yield a bountiful harvest. This time around, hedge funds are widely blamed for leading the commodities frenzy, hiding behind what analysts call “supportive market fundamentals” while whipping up prices to the breaking point.
But hold on… If you think that unfettered speculation in energy futures is a danger to your well being, wait till you hear which commodity the ‘locusts’ are turning their attention to next:
Garden variety crop price manipulation has been going on for decades, but now speculators are turning their attention to what they call ‘owning structure’. In other words, owning the means of food production as well as the distribution system. Everything from farms to fertilizer, processing to packaging, all in the hands of multi-billion dollar hedge-funds. But…unlike agribusiness, where the outlook is somewhat longer term and profits comparably smaller, hedge-fund investors demand enormous short-term gains. And how do you engineer such gains? Well, as Jim Hightower puts it:
…If you can lock down production and stockpile the supply – you can control price. If corn prices are lower than what investors want them to be, simply store the corn and force prices up. Or, if corn prices are down in the U.S., ship it to Japan or wherever else might be more profitable
In short, engineer famine for the sole purpose of satisfying your investors, a situation that should not be tolerated in this, or any other country. This is the point where we transition from being a Corporate Kleptocracy to being just a normal kleptocracy.
While we wait for the Senate to cave to the administration on telecom immunity—we should take note of the fact that the whores at AT&T, Verizon, and Sprint have already been paid for servicing Bu$hCo.
Indeed, whether to help the telcos mitigate the financial danger of class action lawsuits or simply as a “Thank you for helping us build the surveillance society,” cooperative companies watched their federal contract income skyrocket in 2007, up to $1.3B in Sprint’s case. Whereas non-cooperative telcos, Qwest for example, watched their federal contract income drop by 100’s of millions of dollars.
But…not to be outdone by the industries they’re protecting, our congressmen have also watched their coffers fill as a direct result of flipping on immunity—typically a doubling of industry campaign contributions for those representatives willing to bend over for telcos.
So everybody gets paid in a perfect little circle-jerk. Bu$hCo pays the telcos with your tax dollars. Telcos put those dollars back into the pockets of representatives and senators who in turn pay off Bu$hCo by f*cking the American people.
Who would ever have imagined that monetizing the trashing the Constitution could be so lucrative.
As if all kinds of new charges on checked luggage weren’t enough to make you want to stop flying, we now find that TSA is in the business of putting a little extra money in the pockets of the airlines.
Any recent changes in the way you use or spell your name? Did you start using your middle name? What’s on your passport? And what about that ticket you just booked…didn’t use your nickname by any chance, did you? Well if you did, beware. TSA has a thing they call the “exact match rule” that allows airlines to deny you boarding if the name you book under doesn’t exactly match official documents like your passport or your US government approved identification (i.e., your driver’s license in this new era of Real ID.)
And just what do you do if the airline says “no”? Well that’s when this situation gets really egregious. TSA allows the airline to just let the whole thing slide for a $100.00 fee. In other words, the supposed reason for denying you boarding—the potential security risk of the inexact name match—becomes irrelevant if you agree to grease the airline’s palm. But what if you refuse? Well then…there’s extortion, officially sanctioned by TSA. “What do you mean you don’t want to pay us $100.00? OK. Rebook your damn ticket, chump!”
Another fine example of the Corporate Kleptocracy in action: Anything to help the corporations turn a profit at the expense of consumers.
Should have blogged about this last Friday but didn’t. So thanks to Abi @ 604 for reminding me.
Mary Gade was the head of the EPA’s Midwest Regional Office, and since 2006 when she was appointed by the Bush Administration she’s locked horns with Dow Chemical over cleanup of dioxin contaminated sediment in Lake Huron and Saginaw Bay. She’s invoked EPA emergency powers to force Dow to clean up three highly contaminated sites near its Midland plant, and last November she called for additional dredging after tests found dioxin levels of 1.6 PPT in a Saginaw park, the highest concentration ever recorded.
But last week, Gade resigned after being stripped of her authority by aides to EPA Administrator Stephen Johnson who told her that, if she did not resign by June 1st, she would be fired.
First rule of a Corporate Kleptocracy:
Remove regulations on, curtail oversight of, and block corrective action against predatory industries.
I purchased my first flat 4 years ago this month. By American standards, I waited a long time to own my own place. I was careful. Though I could have purchased more, I stayed well under what my finances could afford. When people all over Sodom by the Sea were taking out second mortgages to finance their down payments, I put down the conventional 20%. I was unlikely to be helped, or hurt, by any bill that Congress came up with to stimulate the US housing industry. I don’t need my government’s help. And yet the Senate has managed to come up with a bill that will hurt me and just about everyone else, while at the same time failing to do didly for the millions of Americans facing foreclosure. What are these f*ckers thinking?!
$6 Billion in tax breaks to builders. Builders!!! A huge giveaway that allows them to count current year’s losses against profits from as far back as 2004! $4 Billion to communities to help them buy up foreclosed properties. Though what-the-f*ck they’re going to do with those properties remains a mystery—because right now getting a loan is harder than getting Fed Chairman Ben Bernanke to utter the word “recession”. And for homeowners? A paltry $100 Million to fund efforts to have their mortgage situations reviewed. Not mitigated mind you—no actual relief—just a review that may or may not result in relief. In fact, the one and only decent proposal to help homeowners, letting judges reopen mortgage agreements as part of bankruptcy proceedings, got cut. Go figure.
So once again, we see the Corporate Kleptocracy—a government/business partnership designed to loot as much of the people’s wealth as possible—in action!