Euro Crisis and Impact on Global Financial Markets

May 27, 2010

By Padmini Arhant

It originated in Iceland with the pervasive subprime mortgage factor and similarly affected other economies like Ireland, Greece, Portugal and Spain, referenced as PIGS.

Although, every nation in this category share the contaminated ‘derivative’ traded internationally, the lack of deficit control with the national budget exceeding the GDP growth also contributed to the meltdown and subsequently reflected in the poor credit rating.

More prominently, Greece identified with:

“Goldman Sachs between the years 1998-2009 has been reported to systematically helped the Greek government to mask its national true debt facts.

In September 2009 though, Goldman Sachs among others, created a special Credit Default Swap (CDS) index for the cover of high-risk national debt of Greece. This led the interest-rates of Greek national bonds to a very high level, leading the Greek economy very close to bankruptcy in March 2010.”

The culmination of internal and external mismanagement primarily led the Mediterranean economy to the brink of collapse seeking bailout from the European Central Bank (ECB), EU and IMF.

European Union was challenged with a predicament in the Greece bailout to either ignore the problem or address it to avert the contagion in Europe.

Since Greece is an EU member using the reserve currency euro in the 16 of the 27 states representing the eurozone, the former alternative would have had serious ramifications.

Besides, the euro being the second most traded currency in the world after the U.S. dollar; it has multifaceted impact on the financial markets dealing with high volume trading especially in the futures exchange.

The industrialized and emerging economies are in a bind with the euro value reduction, due to the competitiveness expansion in export trade. For example, the export oriented Germany is at a competitive edge with the United States, Japan and China irrespective of Germany specializing in high end industrial and heavy machinery equipments.

Hence, the euro crisis upside is the European nations gaining export affordability.

Accordingly, the emerging economy and the major U.S. creditor China is concerned about the potential split in global market share and availing the opportunity to reject the U.S. request for currency (renminbi) value adjustment, which has been set below the market determination despite China’s extraordinary trade surplus.

China’s currency, renminbi (RMB) or yuan (CNY) has been withheld from floating as the international currency in the foreign exchange market to protect the status quo.

At the same time, the positive aspect of the dollar appreciation is omitted in the evaluation and that being the foreign investments in U.S. dollars particularly the Treasury bills held by China is strengthened in value and guarantee long term security in futures contract.

Financial stability measures adopted by EU, IMF and ECB with approximately one trillion dollars of which a conditional rescue loan worth $110 billion to Greece is approved to reverse the negatives in the financial markets reacting to the euro downslide from the unsustainable government debts and deficit level.

Had the eurozone requirement on its union members to keep deficits below 3 percent of GDP maintained, Greece and other struggling economies need not have been subject to harsh austerity strategies that has resulted in protest among the mainstream population in Greece and Ireland.

Regardless, the current global financial crisis calls for wasteful expenditure elimination and the national budget review to direct investments in high value returns.

Appropriate actions involving tax hikes and spending cuts are necessary to balance the budget.

However, spending cuts targeting the fundamental programs inevitably generating revenues through productive workforce and consumers is counteractive.

Restoring essential programs and services for the job creation and preservation, youth education, citizens’ health care, social security, safe and clean environment nurture healthy and middle class society to ease the burden on the top 1% or 10% wealthy taxpayers in different economies.

Most importantly, the defense budget consuming a significant proportion of taxpayer revenue in the prolonged wars could be divested to peaceful and profitable opportunities benefiting the citizens at the domestic and international front.

The ideal solution for the European Commission and the monetary union to avoid rising deficits in Europe without compromising the member states’ sovereignty in their national fiscal policy decisions would be to establish an independent, non-partisan committee by the states to examine the individual spending and tax plan, rather than the centralized monitoring or the neighboring authority verifying it.

Further, the constitutional amendment by Germany to contain the deficit to 0.35 percent of GDP by 2016 provided the higher deficit not attributed to GDP decline is a trendsetter in curbing the economic crisis.

In concurrence with the economic experts’ advice – The ECB expediting the credit approval on government bonds used as collateral upon qualifying the self-regulated constitutional limit on deficits is prudent in deterring broad speculative lending activities.

Alongside, the EU sweeping financial reform with tough standards against the hedge fund managers including the two proposals by German Parliament:

Global financial transaction tax and Financial activity tax focused on CEO’s Personal Income & Bonuses are effective steps with the exception of the global financial transaction tax because it is eventually transferred to the end-consumer and may not be a viable option for all participants.

Nevertheless, international agreement on financial regulation by G-20 and other nations is crucial in order to emerge from the existing crisis and prevent the future economic recession.

The systemic risk in the multi trillion dollars ‘derivatives,’ that caused the financial debacle in Europe, Middle East (Dubai), North America, Asia and elsewhere demands stringent policies and independent investigations on fraudulent ventures.

The financial overhaul passed by the U.S. Senate last week has been under scrutiny by analysts with mixed response and elaborated in the article titled:

“New Financial rules might not prevent next crisis – Associated Press, Sun May 23rd. 2010 at 3.55 PM EDT. Reported by Jacobs from New York and contributed by AP writer Jim Drinkard.”

Unequivocally, closing the loopholes as detailed in the cited article and other reports is paramount to establish a financial system free of K street influence.

The apparent revolving-door relationship between Wall Street and Capitol Hill in which employees and consultants have moved in and out of high level US Government positions, with the prevalent conflict of interest is a hindrance to any legislation.

Only the electorates with the voting power in a democracy can remove the persisting obstacles by rejecting the special interest representatives in politics against meaningful legislation.

People as the consumers, taxpayers and voters are the ultimate force in achieving the progress for common good.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Business | Leave a Comment 

Popular demand for Universal Health care – Single Payer System

April 29, 2010

By Padmini Arhant

The special interests representing the insurance and the health care industry successfully thwarted the consumer demand for Single Payer System with aggressive lobbying and campaign.

It’s not hard to figure out the reason behind industry opposition to Single Payer system.

Single Payer system is the guaranteed health care for all citizens regardless of personal health and economic status.

With the 24/7 access across the nation, it effectively addresses the opponent’s claims against the ‘Universal Medicare.’

Issues such as waiting period and subsidized quality are eliminated with the promotion of Medicare payments and not cuts to the hospitals and the professionals across the health care spectrum.

Similar to the social security number assigned to every legal resident, the Medicare expansion with a standard Medicare card for 24/7 access at any medical facility is long overdue in the only industrialized nation restricting the provision.

Medicare is an established system in the United States.

Other federal programs that are operating in conjunction with Medicare are highly beneficial to the segments receiving the government administered health care service.

Programs such as Medicaid, CHIP, VA, COBRA along with Medicare are the salvation for the ailing and the unaffordable groups in the society.

Since these services are available only to specific segments, the vast majority are forced to endure the abusive conditions in the private insurance and health care industry.

Consolidation of the current federal programs into a ‘Single Payer system,’ would not only provide universal coverage in real terms but also contain the astronomical costs incurred by the taxpayers in the exclusively privatized national health care.

The irony in a democracy is, the people are expected to cast their votes to their representatives and they are forbidden from seeking the basic human rights like the national health care for their contributions through exorbitant premiums and tax dollars.

Contrarily, the campaigns funded by the relevant industries ensure they more than recover their investment in each candidacy from the local to the highest office on the land.

Otherwise, democracy is up for sale during the elections.

The largest donation recipient usually emerges the victor, and then onwards,

The campaign financiers control the legislative process, leaving the electorate with the actual power, a mere formality.

Citizens’ consciousness to the democracy abduction is devoid of vigor and often distracted by the corporate owned media and other outlets, ever dedicated to spin the facts into the concocted theory in obeisance to the sponsors.

When politics is governed by profit management, the democracy’s voice is silenced with massive propaganda and shenanigans.

As a result, the truth and the public trust are casualties in the so-called free and fair elections and the governance supposedly pledged to transparency and accountability.

Speaking against injustice by itself declared as injustice and condemned in the highest order.

Again, the condemnation varies with the target’s background.

The health care is a classic example where the public plight is subject to the industry and their representatives’ acknowledgment or the lack thereof evidenced in the health care legislation costing in excess of $35 trillion for the period 2010 – 2019 and,

Yet the estimated 34 million remain uninsured until such time.

In addition, the mandatory insurance purchase from the private sector expected to generate revenue in penalties through default by the 4 million struggling households.

Essentially, the electorate granting power through the ballots is rendered powerless in a democracy defined as the government of the people, by the people and for the people.

Changes do not occur voluntarily.

Throughout history, the grass roots movement has been responsible for the paradigm shift in politics, economic and social environment.

Their activism and relentless support has been instrumental in promoting economic and social justice, particularly political freedom in different parts of the world.

Sometimes human apathy is directly related to ‘individualism.’

Personal experience triggers instant reaction than passive exposure.

Health care bill like the other legislations, severely affects every citizen as a subscriber and a taxpayer.

Complacent to the recent legislation by denouncing the factual presentation is oxymoron, notwithstanding narcissism.

Standing with the power is an easier option and commonly displayed in the absence of courage.

Failure to amend the health care bill is declining the popular demand for ‘Universal Medicare,’ through Single Payer system –

The honorable and the best health care policy to end the population misery.

Denial eventually leads to cataclysmic outcome and in the health care matter,

It’s a choice between saving life and adhering to the political convention.

Citizens’ need compromised in the health care bill is a travesty and the inaction to reverse the course reveals the Washington reality.

People must come together and share their passion to restore democracy conspicuously lost in the special interests’ dominant legislative affairs, poignantly the health care reform.

Remember, the health care debacle is like the wildfire known for ravaging the entire habitat.

Reluctance to modify the health care legislation to ‘Universal Medicare with 24/7 access’ is an invitation to a colossal political defeat in the midterm elections.

Rationality never betrays at the crossroads of decision-making.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Health | Leave a Comment 

Health Care Scandal – Apocalyptic Forecast

April 28, 2010

By Padmini Arhant

Despite the candid presentation with facts and figures on the scandalous ‘Health Care reform,’ the issue is evaded with nonsensical representations by sources benefiting from the monumental fraud.

Perhaps, the notion among the authorities is the public have to be content with the policy that is unequivocally detrimental to the citizens interest, regardless of this being a life and death matter and,

Ignore the apocalyptic event arising from it – particularly with respect to,

The cost/value determination showing a significant rise in national deficit at $35 trillion for the period 2010-2019, without the much-acclaimed insurance coverage for the 34 million uninsured.

Details made available in the articles:

Health Care Reform – A National Scam – April 25, 2010.

Health Care Reform – Facts and Flaws – April 23, 2010,

Health Care Legislation Amendment – April 22, 2010 and

Thorough analysis of the components reveals the legislation is industry favored with the vulnerable population subject to predatory practices, otherwise the status quo extension granting exclusive rights to the private sector with an utter disregard for the public health and national debt.

Rejecting the legislation amendment call is a dangerous precedence in a democracy not to mention the constitutional breach, the latest trend in the abuse of power.

There is more chilling evidence that beckons unanimous action on the national debt.

According to the Washington Post article – April 27, 2010

Panel to meet on skyrocketing U.S. debt

If no action is taken, forecasters see fiscal crisis by decade’s end

By Lori Montgomery, Washington Post – Thank you.

Washington – A presidential commission will convene today at the White House to address what leaders of both parties agree is one of the greatest threats to the country’s economic future:

“The rising national debt.”

Official forecasts suggest that without sharp changes in federal spending or tax collections, the United States could enter into a downward spiral of indebtedness that by the end of this decade would erode the country’s ability to educate its children, care for the elderly or mount a robust national defense.

Republicans and Democrats alike say the fiscal challenges have been too long ignored.

But with the two parties feuding over health care reform, Wall Street regulation and a host of other issues – and the economy still uncertain after a deep recession – there is considerable doubt that they could join hands to fend off a still distant potential crisis.

“It would take a miracle,” agreed Senate Majority Whip Richard Durbin, D-Ill.

But “I believe in miracles.”

Durbin is the highest-ranking lawmaker among a dozen members of Congress on the commission, which also includes six presidential appointees.

The panel has until Dec. 1 to devise a plan to stop a federal borrowing binge that exploded during the recent recession and will only get worse as retiring baby boomers tap into federal retirement programs.

The gulf between the two parties is vast.

No budget commission has managed to spur action since 1983.

And a host of interest groups is lining up to rally the public against any solution that involves higher taxes or cuts to favored programs – particularly Social Security, which members of both parties consider the ripest target for compromise.

Even supporters of the commission are not optimistic:

House Majority Leader Steny Hoyer, D-Md, a vocal advocate, said the most he expects is,

“A good message with regard to the magnitude of the problem.”

But panel members from both parties say the experience of Greece, deeply in debt and begging other countries to help pay its bills, provides a vivid incentive to set aside ideological differences and work together.

“After stopping a terrorist with a weapon of mass destruction, this is the single most important issue we confront as a nation,”

Said Sen. Judd Gregg, R-N.H., a commission member.

That crisis seemed distant until the recession hit, causing tax collections to tank and federal spending to increase as policymakers scrambled to avert an economic collapse.

The public debt is forecast to rise from less than 40 percent of the economy to more than 60 percent by the end of this year, its highest level since 1952.

The debt will hit 90 percent by 2020 under President Obama’s budget, according to the nonpartisan Congressional Budget Office, a level last seen in the aftermath of World War II.”
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Grim Reality – By Padmini Arhant

It’s clear from the above WP article and the health care legislation costing $35 trillion for the decade 2010 -2019 under the private for profit health care with 34 million uninsured until 2020,

The United States fiscal crisis is a looming national and global financial disaster.

Failure to amend the health care legislation is a kamikaze action on behalf of those in power unwilling to acknowledge the inevitable catastrophe under the guise of health care reform.

U.S. Chamber of Commerce not surprisingly, considers the public option or the Universal Medicare disruptive in their televised forum on April 26, 2010.

Not long ago, their key representative proudly claimed to have influenced the Supreme Court decision in the ‘Citizens united vs. Federal Election Commission.’

With the cosmetic measures in the health care bill, the legislation is essentially a jackpot for the insurance industry due to the mandatory insurance purchase through federal aid and the regulation lapse extending beyond the decade.

Legislations espousing special interests’ agenda is not a revelation.

However, the ‘Hope and Change,’ campaign pledge was meant to transcend the culture in Washington through transparency and accountability, a misnomer at the political helm.

Continuation on this path projects the dismal economic conditions for the United States, similar to Greece forced to rely on external rescue for solvency.

There is an exception to the United States situation.

Unlike Greece, the United States shares the ‘Too big to fail,’ status and the major creditor China would be susceptible to the precipitous fall,

Notwithstanding the clichéd ramifications on the world financial markets.

CBO’s proclamation on the U.S. debt expected to hit 90 percent by 2020 under the current administration’s budget is not merely a national affair but an international calamity, seeking universal attention.

United States borrowings absorbing 90 percent of the national GDP with revenue on the decline and increase in federal spending is unsustainable.

The economic collapse that was averted in 2009 is effectively created through irresponsible legislations viz. the health care bill designed to escalate the national deficit.

National health care legislation was absolutely necessary to save lives starting immediately.

But not to promote the prospects for the flourishing insurance and the health care industry.

Medicare for all citizens with 24/7 access alongside the private insurance for the high end market as elaborated in the article Universal Medicare – Single Payer System, April 8, 2010, on this website is the ideal and the only viable solution to national health care apart from containing the national debt.

Since Medicare is already established, the cost control and the Medicare expansion to all citizens is no longer a request but a requirement.

Why would the authority in Power lead the nation to the ‘Death Valley’ and refuse to provide valid explanation on this bizarre decision that has been made into law?

Citizens’ disapproval and peaceful (non-violent) protest against the industry favored, private for profit health care is the only hope for democracy to survive.

As for those defending the health care bill and defying the burgeoning national debt from it are in denial.

Remaining complacent to the private for profit health care law at $35 trillion dollars in the absence of universal coverage is a huge burden on the baby boomers and the future taxpayers.

Perhaps, the self-realization that their tax dollars are transformed into the industry’s extravagant bonuses in the ‘business as usual’ environment could change their position and prompt them to be part of the solution rather than the problem.

National debt and valuable health care are inter-related and the health care law exacerbates both issues through preference for profit and politics over people.

The citizens action demanding ‘Universal Medicare’ with 24/7 access by health care bill amendment is imperative to protect life and the democratic system.

It’s incumbent upon the administration to do the needful for the nation or step down graciously.

Democracy is alive when the government of the people stands by the people and delivers for the people.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Ethics | 1 Comment 

Defining the Humanitarian Responsibility

April 16, 2010

By Padmini Arhant

I wish to define the specific purpose of my presence in the political debate that has caused immense anxiety and unnecessary turmoil in the political circle.

As stated earlier, I’ve been assigned a divine mission that I cannot possibly evade or decline in any format.

I am the protector of humanity. My goal is to help achieve freedom, economic and social equality for all in the world.

The commandment is straightforward and that being – the establishment of peace, progress and prosperity.

I’m not here to serve any particular political entity, party or the organization they might represent.

My political position is ‘Independent’ with the commitment towards public needs.

The primary tasks are:

Protect the people’s interest in the United States and across the globe.

Preserve the environment.

My role is to safeguard the people’s rights in a democracy, defend the truth and deliver justice regardless.

The major responsibility is to prepare the planet for a new era in coherence with the cosmic settings.

In terms of the legislative matter, the members of Congress and the Executive branch will be provided with the legislative content and reform details in public to benefit the people and the nation.

In fact, the practice to be continued since my involvement in politics, except the requests were ignored earlier and instead,

The legislations were prepared by the relevant industry and the Executive branch sponsors to suit their agenda.

I was then approached to rally the mass without any bill details.

As the voice for the weak and the vulnerable, my contribution is to enable people govern the nation rather than the special interests directing the legislation.

It would apply to the domestic and global policy.

Notwithstanding the legislative measures to amend the bills found inadequate or is against national interest.

In addition, it includes the call for investigation of the administrations’ policies responsible for deaths and destruction of lives in the United States and around the world.

If the legislation is flawed and potentially harmful to the citizens’ of the United States in domestic policy and likewise in the foreign policy, it’s incumbent upon the head of the Executive branch as the bill’s signatory and final authority to provide valid reasons for such measures.

Barring the ‘special interest’ dominance in the legislative process and the political campaigns is a priority.

It’s a monumental feat even with the divine intervention.

Therefore, the cooperation of the people, the press and the news media is instrumental to make the government run by the people and for the people.

Another effective democratic action would be to implement the ‘campaign finance reform.’

Public participation is crucial through relentless communication with their local representatives to vote for the fundamental changes in the electoral process.

Those who fail to heed to their constituents’ call would be replaced with the obliging candidates.

Citizens should bring them to public focus and seek a legitimate response for their inaction.

The Supreme Court rule has exacerbated the strong political-corporate partnership that has long undermined democracy.

The communication to the political figures from my end has been via on-line for public view.

Accordingly, I request the political authorities to submit their requirements in public to create the foundation for transparency and accountability.

The legislators on either side of the political factions willing to cast their votes to improve people’s lives, advance national and international cause will be guaranteed support for election or re-election.

Washington is broken. It is common knowledge.

However, when the administration, irrespective of the political party is defiant in their claim on legislations and decisions pushed forward against the will of democracy, it is essential to break the chain link.

The previous administration’s unspeakable crimes are forced to become a distant memory and the trend continues with the incumbent administration, refusing to recognize the public disappointment on the national health care legislation scandal.

Further, it’s deeply disturbing to insist that the people accept the issue as a done deal.

Mortgaging the health and lives of millions of people to a health insurance industry to secure the “Political Power” is regrettable especially with the mandatory insurance purchase introduced in the bill.

Exerting pressure on the dissent to fade away is undemocratic and leads the nation towards a wrong direction.

Constantly repeating that “Health care reform is passed” and time to move ahead by disregarding the voice of democracy – the press, media and the people’s concern is indicative of ‘organizations’ controlled political system.

During the 2008 Presidential campaign, the political slogan was – the nation would experience “More of the same” with the Republican Presidency in power, implying that it would be the continuation of Bush-Cheney legacy.

Having been in office for fifteen months, the Obama administration’s record in dealing with the special interests, wars and foreign policy exemplify the adherence to the predecessor’s principles that was vehemently criticized but not abandoned.

There are legislators in the system willing to transcend the culture in Washington. Some of them have admirably spoken against it and shared their grievance with the public.

When the majority is in contract with the “lobbyists” from the various industries,

Perhaps, the minority feels threatened with the possibility of being swift boated in the Congressional race through negative campaign ads.

Unfortunately, they succumb to the ‘special interests’ subversion or their allies in the political hierarchy.

Here are the problems and the solutions for it.

The political system needs reform due to the inherent ‘special interests’ influence in every legislation.

Remedy: Legislation will be conceptualized and presented for public review on-line.

Public prior approval will be sought with queries addressed diligently for clarity.

Queries may be submitted on the Congressional websites.

The legislation material will be precise to dissuade the opposition from rejecting the bill under the pretext of ‘volume.’

Lawmakers will be given sufficient time to study and evaluate the content.

Their input is to be presented in public via on-line on the new webpage – www.publiclegislation.gov, in extension of the existing Congressional website for the House and the Senate.

Legislators will be encouraged to debate and discuss the issue with their constituents and the media to conform to transparency.

I will work on the people’s side to ensure that the policies and legislations benefit the citizens at home and overseas.

The analysis and review will be published prior to the legislation approval, i.e. after receiving the legislators’ views and their exact position on the issue.

Legislation will have a deadline and the legislators would be required to meet the objectives within the given time frame so that the bills are passed with public consent.

Legislators’ voting record on every bill will be displayed on the Congressional web page.

Lawmakers’ brief comment for voting in favor or against it, would be enormously useful to the public.

Legislation is to begin with the Political reform:

Campaign finance reform restricting the sources – corporations, union, religious institution, foreign organization…except for the U.S. citizens, is to become the law.

Election expenses are to be limited and held accountable to the non-partisan election commission, preferably set up by the Public Policy Institute or an independent group non-affiliated to the private sector.

Any lawmakers receiving special interests funds are to be exposed and challenged with a candidate vowed to the public interest.

The news organizations and the media along with the public could play a major role in the political reform by restricting ‘special interests’ access in national legislation.

Health care legislation is to be amended with the guidelines detailed in the article “Universal Health Care.”

I look forward to working with the members of Congress, the news media and the public in reaching the political milestones.

We could consolidate our talent and resources as a nation and work in harmony to restore the magnificent image of the United States of America and bring peace to the world.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under United States | Leave a Comment 

Mortgage Refinance and Foreclosures

March 31, 2010

By Padmini Arhant

In the current economy, two major issues deserve urgent attention.

They are – unemployment and home ownership.

This topic will focus on the homeowners and the federal program under consideration to address the foreclosures arising from high mortgages.

Meanwhile, the following news report and editorial from other news organizations are presented for reference.

According to the –

1. New York Times report By David Streitfeld – Friday, March 26, 2010 – Thank you.

New help for homeowners – Revising Loan Modification

The Obama administration will announce today a broad new initiative to help troubled homeowners, potentially refinancing several million of them into fresh government-backed mortgages with lower payments.

The escalation in aid comes as the administration is under rising pressure from Congress to resolve the foreclosure crisis, which has put millions of Americans at risk of losing their homes.

A major element of the new program, according to several sources who spoke on the condition of anonymity, will be to encourage lenders to write down the value of loans for borrowers in modification programs. Until now, modification programs have focused on lowering interest rates.

Another major element will involve the government, through the Federal Housing Administration, refinancing loans from borrowers whose home value has sunk below what they owe on it.

More than 11 million homeowners are in this position, known as being underwater.

That aspect of the plan would apply even to borrowers who have not fallen behind in their mortgage payments.

Investors who own the loans would have to swallow losses but would probably be assured of getting more in the long run than if the borrowers went into foreclosure.

The FHA would insure the new loans against the risk of default.

Many details of the administration’s plan remained unclear Thursday night, including the precise scope of the new programs and the number of homeowners likely to qualify.

This much was clear, however:

The plan could put taxpayers at increased risk.

If many additional borrowers move into FHA loans, a new downturn in the housing market could send that government agency into the red.

The FHA has already expanded its mortgage-guarantee program substantially in the last three years as the housing crisis deepened, insuring more than 6 million borrowers.

Sources said the agency would receive $14 billion in funds from the Troubled Asset Relief Program, cash it could dangle in front of financial institutions as incentives to participate in the new program.

A third element of the White House’s housing program will require lenders to offer unemployed borrowers a reduction in their payments for a minimum of three months.

An administration official declined to speak on the record about the new programs but said they would “better assist responsible homeowners who have been affected by the economic crisis through no fault of their own.”

The plan would essentially supplant the government’s earlier mortgage modification plan, announced a year ago with great fanfare.

It has resulted in fewer than 200,000 people getting permanent new loans.

As many as 7 million borrowers are seriously delinquent on their loans and at risk of foreclosure.

The news was greeted with cautious enthusiasm by groups that have tracked the foreclosure crisis and tried to assist communities and underwater homebuyers.

“It sounds really good, and I’m not used to saying that,” said Kevin Stein of the California Reinvestment Coalition in San Francisco.

He said “the two main weaknesses” of the existing federal Home Affordable Modification Program were that,

It didn’t reduce the mortgages of underwater homeowners,

And, didn’t help borrowers who were underemployed or unemployed and would have difficulty qualifying for a loan modification.

“It seems they have taken these issues to heart,” Stein said.

“It’s unclear how many people will qualify – that’s the one hesitation. We’re not sure how broadly these initiatives will reach.”

Martin Eichner, with Project Sentinel in Sunnyvale, said the proposals sound good but he would like to see the details.

“It has to help significant numbers of people and there has to be enforcement,” Eichner said.

“These plans always look great in the first news release, but we’ve often been disappointed in the performance. To the extent that lenders write down principal balances, that would be a significant improvement,” he said.

Eichner said the home affordable effort also needs an enforcement mechanism.

“Without any real consequences, day to day we see lenders ignoring what we think are pretty clear rules under the current making home affordable program,”

While the number of foreclosure-related filings is beginning to flatten or decline, the number of borrowers who are seriously distressed is rising.

In the fourth quarter, the number of households at least 90 days past due on their mortgages swelled by 270,000, according to a report issued Thursday by the Office of the Comptroller of the Currency.

“The government is seeking to persuade people to stay in their homes by aligning the mortgage debt with the asset value, which is the only viable path to real housing stability,” said one person who was briefed on the government’s plans.

Several people who described the plans would speak only on condition of anonymity, since they had not been authorized to disclose details ahead of a White House briefing scheduled for this morning.”

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2. Editorial in the Bay Area News Group – March 29, 2010 – Thank you.

www.mercurynews.com/opinion:

Titled – Foreclosure plan has carrots but needs sticks –

“Eight million households are behind in their payments or in foreclosure. But the Making Home Affordable programs has modified just 200,000 loans.

Forgive us for not jumping up and down with delight over the Obama administration’s latest plan, announced Friday, to help stem the tide of foreclosures.

The changes will help those who are unemployed, underwater or both.

But they have come so late that it’s difficult to muster much enthusiasm.

Banks participation in solving this problem has been optional for too long.

The government must require those who caused this debacle to do more to end it.

Since the foreclosure crisis began three years ago, 6.6 million families have lost their homes, according to the Center for Responsible Lending.

The problem is not getting better.

Eight million households are behind in their payments or foreclosure, and

One in five are underwater – they owe more on their mortgages than their homes are worth.

The administration’s primary tool against foreclosures, the year-old Making Home Affordable partnership with lenders, has so far modified the terms of just 200,000 loans. It is not up to this enormous task.

But the changes announced Friday have the potential to improve that record.

The program will now be open to the unemployed, who previously couldn’t qualify but are a primary victim of foreclosures.

They’ll be eligible to get up to six months’ forbearance and to have their payments lowered to reflect their reduced income, at least for a short time.

Those who owe more than their homes are worth – in California, that’s more than a third of borrowers – may finally be able to get their loan principals reduced.

This much-needed shift in approach addresses another key driver of foreclosure.

Lenders will get incentives to reduce the amount owed.

Borrowers who are current on their payments but underwater – prime candidates to walk away from their mortgages and further weaken the housing market – could refinance into a cheaper government loan.

All of this will help. But the main problem with the government effort remains:

It’s all carrots, no sticks.

Consumer advocates have been pushing Congress for years to allow bankruptcy judges to modify loan terms for primary residences, which could reduce foreclosures up to 20 percent.

The financial industry’s army of lobbyists has managed to beat back that idea, known as “cramdown,” saying it can deal with the problem on its own and through Making Home Affordable.

That’s clearly not the case, because of malice or incompetence.

It would be wonderful if politicians gave the same consideration to desperate homeowners that they do to banks.

Most everyone facing foreclosure nowadays did nothing wrong – they’re simply caught in the cascading wave that began with the subprime mortgage crisis.

The same can’t be said of the banks that got us into this mess and then took billions of taxpayer bailouts.

Allowing judges to modify loans in bankruptcy would add structure to an overwhelmed system.

Reasonable compromises worked out in court would set precedents for lenders to follow.

If they didn’t, they could be forced to by a judge.

Judges have this power for second homes.

There’s no good reason they shouldn’t have it for every home.”
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Comment – Review and Analysis is in progress and will be presented shortly.

Thank you for your patience.

Padmini Arhant

Written by Padmini Arhant · Filed Under Economy, Featured | Leave a Comment 

National Health Care Legislation

March 29, 2010

By Padmini Arhant

Last week, President Barack Obama and the Democrats in Congress achieved a historic victory in passing the health care legislation.

The legislative components and the effective period are presented below:

According to the New York Times report March 22, 2010

By Robert Pear and David M. Herszenhorn – Thank you.

Source: Speaker of the House, Congressional Budget Office, Kaiser Family Foundation, MCCLATCHY – TRIBUNE

HIGHLIGHTS OF THE HEALTH CARE OVERHAUL LEGISLATION, WHICH WILL:

1. 90 days after enactment: Provide immediate access to high-risk pools for people with no insurance because of pre-existing conditions.

2. 6 months after enactment:

Bar insurers from:

Denying people coverage when they get sick

Denying coverage to children with pre-existing conditions

Imposing lifetime caps on coverage

Require insurers to:

Allow young people to stay on their parents’ policies until they turn 26

3. Within a year: Provide a $250 rebate to Medicare prescription drug beneficiaries who reach the coverage gap called the “doughnut hole”

4. Jan 1, 2011: Require individual and small group market plans to spend 80 percent of premium dollars on medical services; large group plans would have to spend at least 85 percent

5. 2013: Increase the Medicare payroll tax on dividend, interest and other unearned income for singles earning more than $200,000 and joint filers making more than $250,000

6. 2014: Provide subsidies for families earning up to 400 percent of poverty level ($88,200 a year for a family of four)

Require most employers to provide coverage or face penalties

Require most people to obtain coverage or face penalties

7. 2018: Impose 40 percent excise tax on high-end insurance policies

8. 2019: Expand health insurance coverage to 32 million people

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Late deals added to bill’s revisions – By Alan Fram Associated Press – March 22, 2010 – Thank you.

The latest changes to the bill include:

Tax-exempt insurers would have to pay a new fee levied on insurers on only half their premiums.

An Aug.1, 2010, deadline on new doctor-owned hospitals to apply to the government for eligibility to serve – and get paid for Medicare patients would be extended to Dec. 31.

A new 2.9 percent excise tax on medical devices would be lowered to 2.3 percent.

But it will be broadened to apply to some lower-cost devices it hadn’t initially covered, though hearing aids, contact lenses and other items would be excluded.
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Review and Analysis – By Padmini Arhant

There have been numerous questions by the anxious uninsured and they are being presented in this analysis.

Congressional Report dissection:

Clarification from the legislators would be helpful in understanding the criteria in the following categories:

1. 90 days after enactment: Provide immediate access to high-risk pools for people with no insurance because of pre-existing conditions.

From the concerned individuals – the uninsured with pre-existing conditions but are unsure of their acceptance in the high-risk pool due to variations in the health issue.

A. Who are the qualifiers under the ‘high-risk’ pool in the ‘insurers’ language?

B. Should the insured expect escalation in premium costs due to their ‘pre-existing’ diagnosis as compared to the healthy individuals?

C. If there is a difference in coverage costs; by what percentage will it affect them?

As per the Associated Press report, March 24, 2010 –

D. “But a provision to protect children in poor health has a gap. Insurers would still be able to deny new coverage to kids with health problems until 2014.”

Is it possible for these kids to access care under ‘high-risk’ pool, which is expected to be effective in three months from now, i.e. June 2010?

Therefore, specifics are required in this respect.
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2. 6 months after enactment – October 2010,

The legislative component reverses the status quo for those who are currently insured and,

A. Have difficulties on coverage during their illness including children with pre-existing conditions.

B. Parents are permitted to keep their adult offspring until age 26, on their policy.

C. It prohibits the insurers from limiting coverage and policy cancellation when the patients require treatment.

Unequivocally, it’s a crucial piece of legislation.

However, it could have been made effective immediately rather than a six months delay, due to the nature of the problem.

As it’s well known that in health situations, the cost and cure factor is dependent upon early intervention.
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3. Within a year i.e. in 2010 the legislation involves $250 rebate to Medicare prescription drug beneficiaries upon them reaching the ‘doughnut hole’ or the coverage gap –

Any financial relief to senior citizens and others dealing with enormous health care costs is a welcome change.

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4. Jan 1, 2011 – Enactment calls for ‘marketplace’ insurers to invest premium dollars on medical services by 80 percent for individuals and small plans, whereas the large groups by 85 percent respectively.

Monitoring is essential to ensure such practice among the insurers.

In the absence of oversight, the law would be redundant.

That’s why the independent and non-profit ‘National Consumer Health Rights Agency,’ would be ideal to deliver the service.

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5. 2013: Increase the Medicare payroll tax on dividend, interest and other unearned income for singles earning more than $200,000 and joint filers making more than $250,000

This was the proposal from the House of Representatives to generate revenue for the health care overhaul.

It appears to be preset to meet with the ‘PAYGO’ budgetary requirement to pay for expenditures with funds for the program in progress.

A prudent fiscal policy that is necessary to address the national deficit and approved by the Congressional Budget Office. It’s an important feature of this legislation.

The Republican opposition projected the negative implication of this particular rule on Medicare recipients quoting that ‘the Medicare quality would be affected.’ They need to explain their position.

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6. 2014: Provide subsidies for families earning up to 400 percent of poverty level ($88,200 a year for a family of four)

Require most employers to provide coverage or face penalties

Require most people to obtain coverage or face penalties

7. 2018: Impose 40 percent excise tax on high-end insurance policies

8. 2019: Expand health insurance coverage to 32 million people

In reference to Points 6, 7 and 8:

Perhaps, the funds from the Medicare payroll tax mentioned above are allocated for the subsidies and Medicaid beneficiaries.

Similarly, the 40 percent excise taxes on high-end insurance policies set up to eventually expand health insurance coverage to the targeted 32 million uninsured in 2019.

Again, the same reason stated under 2 C of the analysis, applies to these rules of law.

The people who can’t afford health insurance are most vulnerable to health problems that ultimately become the tax payer responsibility as experienced up until now.

Hence, the law being effective in 2014, four years away from the signed legislation and the reality of the 32 million people being covered in 2019 is a legitimate cause for disappointment among the uninsured.

The authorities owe a plausible explanation to the suffering population regarding the distant period setting for the effectiveness of the law, especially 2014 and 2019.

What is happening to this segment between now and then?

Are there provisions for tax credits to the middle class families and Medicaid expansion to cover the interim premium costs by the uninsured and the unaffordable groups in the society?

If so, how is it being paid for?

Since the revenue from Medicare payroll tax and the excise tax are scheduled in 2013 and 2018, to fund the federal subsidies to lower income families in 2014 and the 32 million uninsured in 2019 respectively,

The health insurance reform cannot be truly evaluated until after 2014.

Besides, the health insurance legislation based on ‘private for profit’ strategy is subject to market rates in 2014 and beyond.

Meanwhile, the legislation tackles the problems faced by the “insured” groups in the society that are significant and guaranteed to save lives.

According to the media reports, the House and the Senate leaders confirmed the available votes to implement a ‘Public Option’ in the health care legislation through reconciliation process within the year.

Indicating that – “We have the votes and we need the will to move forward.”

It’s the best hope for the average citizen in the health insurance reform, considering the anticipated changes becoming law not until 2014 and 2019.

Having passed the legislation, the lawmakers can amend the bill to accommodate the genuine requests from the average citizens for whom the reform was initiated.

It’s a matter of honoring the people’s will in a democracy.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Health | Leave a Comment 

Subliminal Attacks – A new wave Politics

March 8, 2010

By Padmini Arhant

I would like to thank the visitors to the website www.padminiarhant.com in the United States, India and around the world.

Your love and support makes the effort worthwhile.

As stated in the profile, the website objective is to promote peace, progress and prosperity for all with a major focus on protecting the environment, the only ideal habitat for living species in the universe, thus far.

It is depicted in the logo – Save the Planet,and Peace on Earth.

That being the goal, I express my gratitude and deep appreciation to the readers of my articles for taking the time to read and reflect on the topic.

In coherence with the paradoxical universe,

Success is greeted with genuine affection and enthusiasm for its representation – obviously from the supporters.

Likewise, it’s also subject to hostility, propaganda and rejection – by the opposition.

The purpose of the material on the website is to engage the like and the unlike minds in a serious thinking process beyond surface review in order to understand the self-created complexity largely responsible for the global status quo.

Criticisms are directed in many different ways. Constructive criticisms enhance quality.

Targeted criticisms often subvert facts with fiction and personal convictions.

Earlier on the element of truth was explained in a manner to allow rational thinking to prevail over confusion and distortion.

When viewed with an open mind, the articles on the website have invariably defended the weak, the oppressed, the disadvantaged and the victims of mass deception –

Dissenting authoritarianism against innocent population.

In many featured visual content, the protesters represented by the unarmed civilians and the monks were waving a white flag and a peace sign during their peaceful demonstrations for freedom and justice only to be mercilessly hurt and killed in response.

The individualism – “Me, Myself and I” restraints outreach to the less fortunate.

Saving humanity from a myriad of defiant forces is a horrendous task especially when the violators are powerful and immunized against reconciliation for common good.

Synopsis of requests made thus far:

Campaign Finance Reform – Public funded elections poignantly after the Supreme Court decision in Corporations’ favor.

Preserving American jobs by resurrecting the manufacturing sector and small businesses.

Universal Health Care for all – Single Payer System.

Tough Financial Reform – to protect average citizens from predatory and fraudulent practices, providing a safety net for the domestic economy and the global financial market.

Strong Environment Policies – fossil fuel and nuclear energy abandonment.

Public Education – Free higher education for students from average income families.

Economic and Social Justice – Gay rights and legalization of the undocumented workers in the country. Bridging the gap between the rich and the poor. Reviving the middle class in the society.

Nuclear Weapons – eliminating hierarchy prevalent under the pretext of the responsible factor and truthful disclosure on complete nuclear disarmament worldwide.

War and Military Base – Troop withdrawal, the prolonged military operations termination and defense budget divestment in the domestic economy including economic and social development in the war zones.

Being a reliable peace partner in international conflicts particularly Israel and Palestine,

Freedom for Tibet, Burma, North Korea, and Iran and curtail military coups like in Honduras, Haiti, vulnerable nations in Africa and Latin America on the United States watch.

Closure of Guantanamo bay and relinquish torture of terror suspects that’s in violation of the Geneva Convention.

Investigation of illegal invasion of Iraq war and judicial trial against the torture memo author Professor Yoo and others to prevent history repeating itself in the future.

Finally, the ordinary and the extraordinary have to leave this planet sometime in their lifetime in accordance with natural process.

Hence peace and empathy would make the world a better place for all.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Ethics, Politics, United States | Leave a Comment 

Universal Health Care – The Ideal Remedy

March 4, 2010

By Padmini Arhant

Health care reform has consumed significant time without any consensus on the important national crisis.

The last week bipartisan summit confirmed the status quo.

Now the discussion is held on passing the legislation in different format. Some advocating for piece meal legislation while others believe in the consolidated package approval.

Those who opposed the reform from the beginning remain steadfast in their opposition to saving lives for political and personal interest. The obstinacy speaks volume about their commitment to public service.

The back and forth exchange is counterproductive when an alarming proportion, an estimated 45,000 young and old people are dying every year.

Although, the Senate health care bill without public option is upheld as the ‘adequate’ measure, it continues to be an uphill battle in securing the Senate majority vote.

Despite the public testimonials sharing their harrowing experiences along with the facts on the escalating costs, the universal health care was never an option previously among the ‘Super Majority’ democrats with the exception of few legislators in the House and the Senate.

In 2009, when the democrats were a super majority, they lost a once in a lifetime opportunity to provide the American electorate, the deficit reducing and an affordable health care through universal Medicare.

Not all is lost, since the Democratic members and the administration are forced to consider the reconciliation process – an avenue used by the Republican administration and the members on numerous occasions in the past for the military and the corporate agenda.

However, it’s incumbent on the democratic members to serve the public interest by adopting the Single Payer system, when considering the simple majority rule.

Why is the Universal Medicare, an ideal remedy?

1. It’s simple and cost effective in every sense.

2. The system already exists for seniors via Medicare and the VA health care for the veterans. Further, Medicaid and COBRA are also federal funded programs.

3. Current Medicare coverage to seniors and the Federal funded VA programs are acknowledged as the phenomenal milestone in the national health care, even by the Republican members in the Congress. They appreciate it because they are entitled to the health care privileges as the members of the United States Congress.

4. Therefore, the Medicare expansion for all would resolve the disputed intricacies in the present health care debate.

5. Standard rules on the health care services would effectively address the excessive health care management costs attributed to the rising national debt.

6. Competition among the health care service providers promotes quality including the desirable choices for the insured in seeking the appropriate treatment.

7. Fraud and malpractice could be curtailed under the blanket rule for the industry.

8. Mandatory insurance for all under federal program would ease the burden on the society – the individuals, small businesses and the Corporations. It’s stipulated in the pending legislation, but in the absence of a federal run program the private insurers gain absolute monopoly leading to the ‘business as usual’ environment.

9. Negotiations with the pharmaceutical industry under universal Medicare would also substantially reduce the drug costs. Thus benefiting all.

10. Universal Medicare is a guaranteed protection for it would be available 24/7 regardless of the citizens’ health conditions.

The people of the United States deserve an efficient, cost saving, choice oriented health care system such as the Medicare for all.

Under ‘not-for-profit’ universal health care, otherwise the single payer system, the consumers would invest their premiums in their health rather than the insurance and the health care industry CEO’s wealth.

America should not agree to anything less than a Universal Medicare and it’s legislatively possible through the legitimate reconciliation method, currently decided by the democratic members for passing the unpopular Senate version of the health care bill.

Finally, Healthy People means Wealthy Nation.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Health | Leave a Comment 

Eulogy

February 16, 2010

By Padmini Arhant

The nation bid farewell to the two honorable members of Congress recognized as the veterans in national defense and politics.

Rep. John Murtha (June 17, 1932 – February 8, 2010)

John Murtha, a former Vietnam War veteran and then a Democrat in the United States House of Representatives from the 12th Congressional District, Pennsylvania, turned into a strong critic of the Iraq war.

Initially, Rep. Murtha joined the majority of the Democrats and voted for the Iraq war.

However, the Congressman reportedly remained confused about the premise surrounding the Iraqi invasion. Later, Rep. Murtha called for the troop withdrawal from Iraq.

Legislatively, the democrat representative served his constituents until the last moment and earned the reputation as the longest serving member in Congress for the state of Pennsylvania.

Like most public figures, Rep. John Murtha was criticized on ethics related to earmarks spending and receiving campaign contributions from the special interests.

Militarily, Colonel John Murtha appeared to have gained distinction for his service having won many Medals of Honor.

Appropriately, the Congress acknowledged Rep. John Murtha’s invaluable service to the nation.

The veteran Congressman will be missed in the strong dissent against the military presence in Iraq.
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Charles Wilson (June 1, 1933 – February 10, 2010)

Charles Wilson – Previously, a United States naval officer and subsequently a 12 term Democrat Representative in the U.S House of Congress from the 2nd congressional district in Texas is remembered in the U.S operation against the Soviet Army in Afghanistan.

Rep. Wilson was apparently a true celebrity in many aspects with positive and negative connotations.

Nevertheless, the Congressman’s contribution towards the U.S expulsion of the Soviet Union from Afghanistan is memorable.

Similarly, Rep. Charles Wilson as the naval officer deserves credit for his service in the United States Navy and later at the Pentagon in the intelligence unit.

We hope and pray for their soul to rest in peace.

Thank you.

Padmini Arhant

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Congressional Conservatives’ Legislation Blockade

February 10, 2010

By Padmini Arhant

In the preceding article “Progressive Policy for National Progress and Prosperity,” I emphasized on the need to intercept the Congress gridlock by electing the ‘Progressives,’ in the Democratic Party.

Following news articles reaffirm such recommendation.

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1. Congress trying to have it both ways on spending

Lawmakers lament rising deficits but fight for pet projects

By Carl Hulse – New York Times – February 7, 2010 – Thank you.

Washington – While Sen. Saxby Chambliss, R-Ga., said he was all for slowing federal spending , he has no appetite for the substantial cuts in farm programs proposed in President Barack Obama’s new budget.

Rep. Todd Akin, R-Mo, issued a news release simultaneously lamenting the deficit spending outlined in the new budget and protesting cuts in Pentagon projects important to his state.

And Sen. Jeff Sessions, R- Ala., a fiscal conservative and a senior Republican on the Budget Committee, vowed to resist reductions in space program spending that would flow back home.

The positions of these Republicans – and similar stances by dozens of other lawmakers of both parties – are a telling illustration of why it is so hard to control federal spending.

Every federal program has a constituency, and even lawmakers who profess to be alarmed by rising deficits will go to the mat to preserve money that provides jobs and benefits to their constituents.

“I am not a hypocrite,” Sessions said in reconciling his fiscally conservative credentials with his outrage over the administration’s proposal to essentially end the human space flight program and allow private enterprise to take on some of the load – an approach that Republicans typically favor.

Sessions said money taken from NASA would not be saved but would instead be directed to other Obama administration priorities that he did not support.

Others said that the annual tableau in which members of Congress criticize the spread of red ink even as they reassure voters back home of protection for popular subsidies and Pentagon projects exposed the high degree of cynicism and lack of conviction that colors the fight over congressional spending.

“It shows that in Washington, you can be firm on your opinions; it is your principles you can be flexible on,” said Rahm Emanuel, the White House chief of staff.

The Republican juggling act on spending comes after a legislative proposal for an independent commission to study ways to cut the deficit stalled in the Senate, partly because some Republicans who had originally backed the idea balked.

“There are not enough statesmen who will stand up and say, “Cut it even when it is in my district,” said Rep. Jeff Flake, R-Ariz., who has crusaded against spending by both parties on pet projects known as earmarks.

It is not only Republicans who are trying to have it both ways.

Conservative and moderate Democrats who have pushed against deficit spending also quickly protested the cuts in NASA, military and farm spending.

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2. GOP hammers Obama over jobs

Republicans oppose giving leftover bailout money to small banks

By Phillip Elliott – Associated Press, February 7, 2010 – Thank you.

Republicans sparred with President Barack Obama in their Saturday media addresses over proposals to create jobs, further evidence of the difficulty of bipartisan solutions to the nation’s pressing problems.

Obama pushed Congress to use $30 billion that had been set aside to bail out Wall Street to start a new program that provides loans to small businesses, which the White House calls the engine for job growth.

Republicans, meanwhile, taunted Obama with a familiar refrain:

Where are the jobs the president promised in exchange for the billions of dollars already spent?

The barb came a day after the government reported an unexpected decline in the unemployment rate, from 10 percent to 9.7 percent.

It was the first drop in seven months but offered little consolation for the 8.4 million jobs that have vanished since the recessions began.

“Even though our economy is growing again, these are still tough times for America,” Obama said.

“Too many businesses are still shuttered. Too many families can’t make ends meet.

And while yesterday, we learned that the unemployment rate has dropped below 10 percent for the first time since summer, it is still unacceptably high – and too many Americans still can’t find work.”

To help the recovery, Obama asked Congress to use leftover money from the Troubled Asset Relief Program, or TARP, to provide to small banks so they can make more loans to small businesses.

Republicans have criticized the move, arguing any money left over from the bailout should be used to reduce the budget deficit.

In the weekly GOP address, Rep. Jeb Hensarling of Texas chided Obama for proposing a 2011 budget last week that would increase spending, taxes and the national debt.

“Americans are still asking, ‘Where are the jobs?’ but all they are getting from Washington is more spending, more taxes, more debt and more bailouts,” Hensarling said.

The Republicans attack came even as key Democrats and Republicans in the Senate are working on a bipartisan jobs bill.

The senators hope to unveil legislation as early as Monday.”

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3. Obama seeks boost in business lending

Proposals draw fire from Democratic leader in House

By Christine Simmons and Marcy Gordon – Associated Press – February 6, 2010

Seeking to create more jobs, President Barack Obama on Friday asked Congress to temporarily expand two lending programs for the owners of small businesses.

But a Democratic House leader slammed the president’s proposals, saying they’re the wrong approach to creating jobs.

Obama said Friday he wants to bolster the impact of the businesses that are the chief creators of new jobs in a struggling economy.

Just hours before he spoke, the nation’s jobless rate finally dipped below 10 percent – to a stubborn high 9.7 percent – in the latest government figures.

The president said he wants businesses to be able to refinance their commercial real estate loans under the Small Business Administration and he wants that government agency to increase loans used for lines of credit and capital.

The truth is, the economy can be growing like gangbusters for years on end and it’s still not easy to run a small business,” Obama said as he visited a heating and air conditioning company in a Maryland suburb of the capital.

The White House said Obama’s plan would temporarily raise the cap on Small Business Administration Express loans from the current maximum of $350,000 to $1 million.

Obama’s plan would also expand the SBA’s program to support refinancing for owner-occupied commercial real-estate loans.

But even the Democratic head of a House committee wasn’t pleased about the plan to expand SBA lending.

Rep. Nydia M. Velazquez, D-N.Y., chair of the House Small Business Committee, said the SBA Express program has been criticized for underwriting loans that banks would have made without government backing and for carrying the highest default rate of any SBA program.

“With loan defaults on the rise, we should not base our strategy on increasing the size of the least stable SBA lending program,” Velazquez said.

The initiative to refinance commercial real estate debt may dilute it and draw away too many resources, she said.
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Food for Thought – By Padmini Arhant Feburary 10, 2010

It’s clear from the listed articles that, the priorities for the congressional conservatives’ on both sides are not the people i.e. the working class, the middle class and the small businesses.

If they were, they would not try to have it both ways as suggested in the article.

Evidently, the national interest is not the primary concern for the Congressional conservatives and moderates in both parties.

They are preoccupied in their faultfinding against President Barack Obama, instead of cooperating with the rest of the Congress in passing legislations especially,

The health care and health insurance reform where a staggering 46 million Americans are reportedly dying due to these lawmakers’ unwillingness to pass the much-required legislations to heal every American.

Notwithstanding, the credit crunch experienced by the small businesses from the ‘bailed out’ banks’ reluctance to facilitate lending.

Again the finance sector’s default in containing the worsening real estate crisis in both residential and commercial markets calls for immediate action through finance reform – conveniently rejected by the conservatives’ and moderates on both sides.

These legislators positioning them to be ‘fiscal conservatives’ and rebuking President Obama on the rising national debt that, they are contributing with their ambitious pet projects over the ‘average’ American plight, speaks volume on their lack of commitment to the people electing them to the office.

With respect to President Obama’s strategy on SBA lending to the small businesses, the Democrat House Committee response is irrational and confirms the legislator’s ‘out-of-touch’ with reality.

The President’s justification on this issue is right on target.

Since the bailed out finance sector is back in the game with “business as usual,” motto and focused on self-promotion with multi-million dollar bonuses culminated by their Washington representatives’ successful blocking of the finance reform,

The President’s proposal is the only viable option to stimulate the job growth in the most desperate segment of the economy – the small business.

Besides, in the absence of the banking industry long overdue lending activity, the investment risks in the small business is blown out of proportion compared to the risk exposure in the multi-trillion dollar bailouts to the banks still withholding credit to their creditors-cum-taxpayers and consequently restraining the economic recovery.

Time is running out for the conservatives on both sides in correlation with patience among the suffering millions in the economy.

If the Republican members are counting on their rebellious attitude towards the democrat President and the Congress to win elections in November 2010,

They are in for a serious disappointment for the American electorate would not reward the party with a victory in the face of their deteriorating economic conditions resulting from the Republican members’ blockade.

Somehow, if this were to happen, then it would be at the democracy’s peril.

Perhaps, it’s something, the American electorate ought to think about because they are responsible for the stalemate in Washington.

Having elected the ideological representatives for whom the people seem irrelevant – transparent in their obstinacy on legislative matter, the people are the ones who can undo the wrongdoing by voting the redundant representations out of power this November or even sooner.

Democracy is held hostage by the recalcitrant congress members defying the constitutional responsibility to serve the people and the nation as an elected official.

Washington hue shines through in these issues.

How can any President possibly achieve anything in such a hostile environment?

You decide.

Thank you.

Padmini Arhant

Written by Padmini Arhant · Filed Under Politics, United States | 1 Comment 

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