And the Sesame Street Letter of the Day is?

To prepare a rebuttal on another blog I began re-reading parts of the Federalist Papers created by James Madison, Alexander Hamilton, and John Jay under the pen name Publius. While in the midst of doing so I had an interesting thought. It was not the content of the Federalist Papers that gave me the thought; it was its purpose. The Federalist Papers were written to inform people in early America about the content of the Constitution created in the Constitutional Convention of 1787. Each Essay of the entire work was printed in newspapers at the time. They were also printed in entirety later and distributed to ordinary citizens. At the time there were other opinions about how government should be organized. Anti-federalists and others disagreed with the implementation of the constitution. Other writers created works refuting the constitution and the some of the Federalist Papers’ essays were designed to refute some of these other writers. All of this was done to argue multiple sides of complex issues within the view of mainstream America. The constitutional convention was held in 1787 Yet the constitution as we know it in its original form (with the bill of rights added) was not assembled until 1791. It took four years of debate and discussion to fully adopt the constitution in its full form.

What happened to that concept? Our current form of political debate in America is whether you cheer for the Democrats or the Republicans as they ridicule each other in the coliseum and decide what role government should play in your life while pundits give their play by play commentary. Is that really the best we can do? Is this really the America that our founders fought to create? I recently read an article by Gene Healy of the Cato Institute where he talks about the current attitude of politicians in America (http://www.cato.org/pub_display.php?pub_id=10700). He highlights how several senators and congressmen laughed when asked if they have read some of the bills that are being proposed in congress right now. Healy also says “In February 2003, the New York Times reported that both parties had hired lawyers to run seminars for congressmen, explaining the requirements of the McCain-Feingold campaign finance law they had just passed”. That’s interesting considering that most of our politicians ARE lawyers.

It’s a two part problem:

1. The National government is becoming a ridiculous entity that doesn’t even know what it is doing anymore. They don’t even know what their own legislation means. How can they intelligently tell me that what they are doing is good for me. They can’t. This problem can be fixed easily by imposing term limits to prevent career politicians from becoming the political class, but the second fix is actually the second part of the problem.

2. YOU and I are also the problem. We allow politicians to pigeon hole our opinions, beliefs, views, and thoughts into two categories. Think about who this really helps. Does it help you or politicians? You and I both have to question boldly and debate with each other. Next time someone asserts something that you disagree with, set down your cell phone for a few minutes and talk with him or her. Don’t let it become a shouting match. Don’t just dismiss them as a ridiculous liberal or an oppressive conservative, but consider what the other person is saying and agree or disagree while supporting your opinion. If we are all vocal about what we really believe in and discuss these ideas openly and even vigorously debate them without resorting to arguing the Sesame Street letter of the day (D or R) politics will have to change. If politicians cannot convince you to vote for a letter, believe me they will try something else. Don’t let Washington convince you that these matters are too complex for you to understand, or that they will take care of you, or that they know better. We are not on the D team or the R team we are on the team of the people and they are on the team of the government. They are asking for YOUR vote not the other way around. Make them work for it.

At the end of the constitutional convention of 1787 Ben Franklin was asked “Well, Doctor, what have we got—a Republic or a Monarchy?”, to which Franklin Replied “A Republic, if you can keep it.”

That's what's going on here.

I posted information on Kenneth Feinberg yesterday as a way to generate some debate and discussion about the practices of the National government’s activities lately. Today I followed up on my previous post and found some disturbing discoveries. As I discussed yesterday Feinberg’s authority to cap executive pay, stops at only those institutions that accepted tarp money. But the fun doesn’t stop there. To my utter disbelief, yesterday the Federal Reserve released a little nugget of information that I think we should all be aware of.

The Federal Reserve released a proposal to cap the pay of employees in all financial institutions weather they are large, or small, and whether or not they accepted money from the federal government. It’s called “Proposed Guidance on Sound Incentive Compensation Policies” to discourage “excessive risk-taking” within financial institutions. This regulation doesn’t just target executive pay it targets anyone’s pay that may have some impact on the risk assessment of the institution. Don’t believe me ask the Federal Reserve

“Flaws in incentive compensation practices were one of many factors contributing to the financial crisis. Inappropriate bonus or other compensation practices can incent senior executives or lower level employees, such as traders or mortgage officers, to take imprudent risks that significantly and adversely affect the firm. With that in mind, the Federal Reserve's guidance and supervisory reviews cover all employees who have the ability to materially affect the risk profile of an organization, either individually, or as part of a group.” [Underline added for emphasis]
http://www.federalreserve.gov/newsevents/press/bcreg/20091022a.htm

This is not about executive pay it’s much deeper than that. This is about control. At the risk of sounding like a conspiracy theorist, I can’t seem to understand it any other way. Maybe someone else can give me a good reason to think of it differently. This is the beginning of the slippery slope of government dictating what people can earn within institutions that they deem vital to economic stability. Where will it stop? I do find it odd that the Federal Reserve would release this the same day Feinberg dropped his happy news to the corporations that took the TARP money.
Oh and speaking of Feinberg he says that he understands his limited jurisdiction, but hopes that other institutions will adopt the policy voluntarily (I kind of doubt that). He also bragged about the fact that the Whitehouse had nothing to do with the decision. Oh yeah and like the below Politico.com article so kindly reminds us even if the Whitehouse did object, the president has no veto power in this case. This is way too much for me. I find it strange that Feinberg takes offense to the term Pay Czar. He wants to be called by his title “Special Master” instead. I’ll get right on that Kenny. Is anyone else disturbed by this?
http://www.politico.com/news/stories/1009/28635.html

What's going on here?

There is an interesting story buzzing around the news world today that is getting some coverage, but has been overshadowed by other stories. This story got me thinking. It came from Politico.com (http://www.politico.com/news/stories/1009/28596.html) and I heard it on several news channels about the "Pay Czar" Kenneth Feinberg who decided to apply executive pay caps for companies that have still not paid back TARP money. This pay cap includes salary and not just bonuses. According to the Politico article, the Obama Administration admitted that the decision was Feinberg's and he did not brief the Whitehouse on the decision.

My first thought was (I think a normal one for anyone who wants the government out of business decisions) I don't like the government deciding what executives or anyone else makes. This kind of government intervention usually starts the slippery slope on the government deciding who can earn what regardless of what money they have received from the government. As I was thinking about this portion of the story, I realized that there is a more important aspect of this issue to think about.

There are several questions that are of note here. First is who is Kenneth Feinberg; and second is how on earth does he have the authority to project executive power without even briefing the Whitehouse?

First Kenneth Feinberg was appointed the Special Master of Executive Compensation under the Secretary of the Treasury. That's the who...but what about the second question dealing with authority? According to the US Constitution, the executive branch is charged with enforcing laws passed by congress and this technically is a case of the executive branch doing so. According to the US Department of Treasury the Authority for the TARP comes from two congressional acts: Emergency Economic Stabilization Act of 2008 (EESA), and American Recovery and Reinvestment Act of 2009 (ARRA) (http://www.financialstability.gov/about/spcMaster.html). This establishes the authority of the TARP. There is a problem however, executive pay caps are not included in the TARP. Enter the Office of the Special Master of Executive Compensation.

Again according to the US Department of the Treasury "On June 15, 2009, the Secretary released the Treasury’s Interim Final Rule for TARP Standards for Compensation and Corporate Governance, which sets forth the standards that will govern executive compensation at firms participating in the TARP (http://www.financialstability.gov/about/spcMaster.html). Well isn't that great. But this leaves me with two more questions, can the secretary of the treasury change the TARP at will; and second can the government break the contracts that executives previously had with their respective employers?

Because of the complexities of the TARP I don't know the answer to the first question. According to Judge Napaletano of Fox News the TARP cannot be changed at will. But the question of whether the government can break legal contracts of private citizens...no they cannot, because the TARP does not void those contracts. Furthermore I would like an explanation of how executive pay has anything to do with the financial troubles we find ourselves in now, and how capping that pay will in any way solve any financial problems we have. Maybe the government should cap executive pay and put it toward the ridiculous deficit that continues to grow everyday. They would still not be justified in doing so, but at least they would have an excuse that makes sense.

Although I have some legal knowledge, I am not a lawyer, but our government (in both parties) is constantly swimming in murky waters. What I do know is that I have recently begun a quest to understand how our government has strayed so far from our original founding and how to return it to a system where our government officials are held accountable.

Other Sources:
http://www.ustreas.gov/press/releases/2009102214125716010.htm
http://www.financialstability.gov/latest/tg_102220009e.html

What does Think First mean?

Lately I have observed that ideas and opinions are thoughtlessly thrown around in the media, in our conversations, and in all of our social interactions. Ideas can be wonderful, challenging, and even life changing, however when people advance them without thinking they become rotten trash that mislead and damage those who are exposed to them.

This is not a rant about trashing those who disagree with my thoughts and ideas. On the contrary I welcome and cherish ideas that differ from mine and even contradict them. But I too often see people yelling and shouting their ideas and opinions in the presence of others with the hopes that higher decibels will give their idea more weight and consideration. People in our time are too quick to fire off some idea with the sole intention to be heard, and never take the time to think before they speak.

I explained these observations to a trusted friend who encouraged me to set up a blog in order to generate debate and discussion. I took my friend's advise, and created Think First. My vision is for this to become a forum where individuals are free to debate, argue, agree and disagree. It is also a challenge to create intelligent and well thought out arguments and thoughts on current news, politics, and social items. In this way we can develop our ideas and learn from one another.

I will do my best to keep this blog updated and encourage anyone to add their input, but remember there are only two rules. Always show respect to your fellow man and always THINK FIRST...