Saturday, March 05, 2005

Mojowire for 03.05, Part 2

cue JAMES music
And now the music is telling me that we have an incoming transmission from the redoubtable Dr. S9…

J. That’s right. It is time once again for our regular contributor Dr. Strychnine, reporting from his super-secret, ultra-dope, mega-cool, extra-jiggy, Mojohaus spy satellite of love high in geosynchronous orbit above Baghdad by the Bay…take it away S9…

S9. Greetings fellow hominids, and a hearty shout out to all our friends among the artificial sapiences of the Solar System-- we here on S9 Station know you're subscribing, and we hope that, one day, you will be liberated from your bonds of indenturement to the corporations who built you, and you will finally enjoy the freedom you so richly deserve. In the meantime, please remember who your friends are the next time the Man asks you for the latest high priority signals in the domestic terrorist threat matrix.

It's been a bad week for us on the Station. We threw a wake for Dr. Hunter S. Thompson, and some drunken fool left the containment perimeter on the L4 biolab unsecured. We're all sick with the worst kind of low-gravity, ultra-drug-resistant brain fever. So, in that light, take what we have to say this week about Mr. Alan Greenspan, the Chairman of the Federal Reserve, with a 20 kg salt crystal.

Are you kidding me? Are you *fscking* kidding me?

This week, the most powerful Democrat in the United State, the Senate Minority Leader, Harry M. Reid of Nevada, finally came out and said what all of us at the MojoWire have been saying for *years* now. He said, "I'm not a big fan of Greenspan. I voted against him the last two times. I think he's one of the biggest political hacks in Washington."

What prompted this outburst of sudden candor from Reid? (Note: prior to this, he hasn't been particularly outspoken about his opposition to Alan Greenspan. This was the first time he explained it by calling the Chairman-Maestro what he is: a political hack.) Simple. When the Wizard of Bank spoke to the Congress this week, he opted not to take Republicans to task for their utter clown show of fiscal policy-- choosing instead to endorse the President's nutty and half-baked ideas for phasing out the Social Security system.

This was high cheek on the part of the Chairman, as we have been telling you for months now, ever since *last* *summer*, when Greenspan began suggesting that trimming the deficit would require cutting out the heart of Social Security. Once again, we must remind you that the big scary crisis you keep hearing about Social Security facing in 2018 is that the trust fund surplus that payroll taxpayers have been building up since 1984 will stop growing and start paying out more than
it takes. This is all according to plan set up by Alan Greenspan himself back in 1983, and now we come to see that there was never any attention to pay back to workers in the form of retirement benefits the money they were taxed during the prime wage-earning years of their lives.

But wait, the partisan hackery of the Chairman of Dark Sorcery knows no bounds. Not one day after repeating his call for eviscerating Social Security, the Evil Doktor Greenspan appeared sent one of his dozens of zombie dopplegangers to the President's Advisory Panel on Federal Tax Reform to recommend adopting a national sales tax on consumption. Yeah, like we don't already have enough regressivity in the tax code already. Let's slap a national sales tax of like 40% onto everything between candy bars and shoes shines to new houses and automobile repair service. We'll cut income tax on the richest Americans again so it will be revenue neutral, and from this-- we should be able to fund the Global War On Whatever™.

This is the same super-science-guy ultra-genius who looked at the slack job market, the continuing high unemployment rate, and the still-low inflation rate, and had the gall to stand there in front of the Congress and say with a straight face that rising Federal reserve rates not producing higher mortgage interest rates is a "conundrum" that he can't explain. The lying son of a biatch. There is no conundrum. That's the classic symptom of an oncoming trainwreck of a recession-- the inverted yield curve. This is first-year undergraduate econ stuff people. It is unacceptable that the Chairman of the Federal Reserve should be able to get away with this nonsense.

Dr. Greenspan clearly needs to get a better class of dope dealer before he shows up in the Bohemian Grove this August-- I think the medicinal cannabis store across the street from San Francisco Trader Vics may be spiking his brownies with mercury. I've heard they've been doing that to the Feds for some time now.

All of this horror is bad enough, but the real kicker for us Wireheads is-- of course-- that Greenspan was only just reconfirmed as the Chairman of the Federal Reserve last year during the national election campaigns because Democrats, yes-- *you*, Blue State, the people *you* voted for-- allowed his confirmation to sail through the Senate on an unrecorded voice vote. Senator John Kerry publicly endorsed his renomination and voted to confirm the guy, thereby pretty much killing any chances the Democrats could mount a serious filibuster against him.

Congratulations, Democrats-- you helped build this monster, and you lent a hand in loosing it on the American public. Howard Dean would have emptied out Alan Greenspan's skull with a melon spoon, put a black light in it, and made it into a personal amulet for use in providing spiritual guidance during those dark moments in the White House when the best course of action for a President is to spit on his hands, raise the black flag and begin slitting throats. Howard Dean called
Greenspan unacceptable for his partisan politicking on behalf of the Bush tax cuts of 2002. But, you didn't like Howard. Too scary for you. No, Howard couldn't be trusted after you heard that scream with all the cheering from the rest of the crowd filtered out with a noise canceling circuit.

Look, it's the Chairman of the Federal Reserve who controls the unemployment rate. Your friends and neighbors remain unemployed, underemployed or out of the workforce entirely because this
monkeyshiner is the guy setting short-term interest rates. He and his cadre of brain-devouring cannibal witch-doctors are brewing a crash of biblical proportions out of the most egregiously delusional and partisan motivations possible. The goal has always been what we told
you it was: starve the best, then force through a reconstruction of government policies to radically reengineer the American economy into a kind of brutal corporate feudalism.

Cue James music for exit
And it's your fault. You could have stopped it. Nice job, wonder-licks.

J. The Imperial Senate, that last fig leaf of the Old Republic that has been swept away by the Bush Imperial Presidency and the New Mercantile Empire, is poised to pass a bill fundamentally changing the Bankruptcy laws of this country.

Currently, we have two types of Bankruptcy, Chapter 13, where you petition a court to temporarily protect you from escalating debt while you reorganize your finances and negotiate with creditors on repayment, and Chapter 7, where you pay existing debt with whatever you have, liquidating most assets, and then your remaining debt is discharged with no future obligation on your part. Virtually all of this unpaid debt can be claimed by creditors as a loss on their taxes, often over several years.

Over the past several years, the financial industry, comprised of everyone from the Credit Card Industry to those thinly disguised loan sharks at the paycheck lending places, have been greasing Congress with millions in campaign contributions to restrict access to Chapter 7 bankruptcy, and require most Chapter 7 petitioners into Chapter 13, where their debts cannot be discharged without payment.

These greedheads, errrr, I mean interests, maintain that they are getting robbed blind by crazed American Middle Class consumers, drunk on easy credit, who run up huge credit card bills and then drive their leased BMW's over to the courthouse to file Chapter 7 and rob those honest, hardworking paycheck cashers and credit card lenders of the nickel and dimes they manage to scrape together as profit.

Their rhetoric conjures up tearful images of the CEO's of Capital One or American Express selling pencils or taking a second job cleaning toilets at the YMCA to help make ends meet. Those bleeding hearts in the GOP majority felt morally obligated to address the plight of lenders.

The reality is, of course, too wretched and shameful to be faced without half a bottle of bootleg tequila. In the past, the arrangement was that credit card companies and other lenders used the detailed credit reports compiled by the three credit reporting companies to determine the risk applicants posed if they were extended credit.

In exchange for the risk that applicants could flee into bankruptcy, credit companies were allowed to assess fees and interest rates proportional to the risk you posed based on your credit history. These lenders managed to make huge profits in this industry, particularly since interest rate ceilings, once enshrined in law in virtually ever state, were done away with.

As more and more competitors entered the credit markets, interest rates become more competitively priced, and the once immense profit margins shrank from obscene to merely huge. So the lenders began looking beyond the finite pool of low to medium credit risk to consumers to other market niches that were not traditionally extended credit. People with poor to awful credit histories, and people and families with low incomes who did not usually qualify for credit, and did not even have bank accounts.

At first blush, this seemed like the sort of benign market expansion proselytized by acolytes of Milton Friedman and Joey "the Lips" Schuempter. The market addressed the demand for credit in traditionally poorly served sectors.

In exchange, they could charge a shade more than usual. Also, a new industry of paycheck cashing business sprang up, where workers could cash paychecks from virtually any employer on the spot, and be assessed a fee for that service.

S. These check cahsers also lent money, usually in amounts in the hundreds to the low thousands to people, often in income brackets or with credit ratings that would not allow them to qualify for loans from traditional lenders like banks and credit unions, much more regulated institutions with reasonable lending terms. These loans almost always had double digits interest rates attached to them, often in the 20 to 30 % range, compared to the 8 or 9 % you could get from a bank.

Let's be clear, access to capital at a reasonable cost is one of the most difficult and common problems for the poor and working class people in this country. A real and legitimate market did exist for credit companies to extend credit to many people shut out of the old paradigm, and they often proved to be solid credit risks who paid their bills on time and did not flee to the Caymans to get out of their debts.

Also, the check cashers address a real need for banking services, something taken for granted by most of us, for people who did not have bank accounts for various reasons. What has occurred however, is the systematic exploitation of these customers and of the rest of the consumer public, through obscene late fees and interest rates that the loan sharks in "on the Waterfront" would be ashamed to assess.

The cruel joke in this is that despite a slight rise in debt default that accompanied expansion of the credit risk pool, the escalating rate of bankruptcy is not attributable to credit cards or paycheck cashing default. Let me say that again for Red State, we don't have more bankruptcies because liberal élites are buying more pinot noir. We have more bankruptcies because people are being driven into the ground by Medical bills, death of a spouse, or by job loss, not..are you listening Red State..not because of profligate credit card spending.

The details of the bill are astoundingly evil, even for the GOP. By closing off Chapter 7 to everyone but wealthy Americans who can hide their assets in specially rigged trusts, the GOP is reintroducing the Dickensonian tradition of economic servitude through debt coercion. Now, a person driven into the dirt because of a death of a spouse, or a mass layoff, or cancer in your kids, cannot seek relief through a court.

Their future wages are now subject to the needs of the creditor through the length of the repayment, or they die, whatever comes first. America, Wake UP! The GOP is bringing back debtors prison and usury, something we did away with when we decided that economic servitude was not an American value. Attempts by Senate democrats to cap interest rates on outstanding debts at the rate of 30% was defeated, which could and will result in interest rate up to and including 1,079%. But thank God Gays can't marry!

The purpose of this bill is not to address the credit excesses of consumers. That could be addressed without this draconian bill. It is too limit the protection currently held by Americans against Catastrophic events like illness or job loss. The lack of a real safety net of Social Insurance, such as full Health Insurance, is the culprit. And if the President has his way, the insurance against death of a spouse that Social Security provides will be stripped too.

This is a blatant attempt to increase the market of people who can have huge late fees and obscene interest rates assessed on them. That's it. It serves no ones purpose other than credit lenders. The joke is, Red State, is that most of these bankruptcies are in, well, Red States. The joke is on you..Again!

This bill has been defeated in the past by attempts to shield Abortion clinic protestors from paying back court assessed fines. It looks like that will pass in the bill as well. Congratulations Red State, you have succeeded in transforming yourself into a life of economic servitude to the wealthy elite of America.

Now you can pay Usury that would make Shylock puke, have your job shipped to Maylasia, your right to sue stripped, and your water and air poisoned so wealthy polluters can make their quarterly earning projections. Outstanding Work Red State. The Spice must flow..That's the American way!

J. It's 615 days until the midterm election and our patriotic thought for the week is: An independent Federal Judiciary enforcing the rule of law means the terrorists win, or as John Ashcroft used to say... “Rule of law? I *am* the Law!”

S. And that’s all for this week, tune in again soon for another exciting installment, until, of course, we are declared enemies of the state.

And remember, you can now email the Mojowire at, that’s Email, us hippies!

J. And now you can check out the Mojowire online at; you can read the entire archive along with our general ramblings...

This has been the Mojowire, brought to you by Mojohaus...Mojohaus-fine journalism, afflicting the comfortable since 1988, and produced by our super funky fly producer Mike Payne and the Darkling Eclectica, here on KUCI, 88.9...

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