View From The Middle
By Charles Rogers
Last week in this column I was proud - no, happy - no, proud and happy - to announce our esteemed government in Washington determined we (you and I) would get a substantial rebate in the mail so we can get that bad old economy rolling again. Coupled with an interest rate decrease, the $800 and $1,600 rebate Congress and the Administration had been buffeting around to give us seemed pretty good.
The interest decrease was decided on by the Federal Reserve in the midst of the stock market turmoil so working businesses would be able to treat the working public like human beings. Hopefully, these prerogatives would be just the ticket to get us off the brink of the depths of poverty and back to the Yellow Brick Road to financial happiness.
According to all the pundits (I HATE that word!), Congress's joining of forces last week with the President and his economic advisers to come up with the plan was not too surprising. After all, we had to do something in order to prevent a recession, which, for all intents and purposes, is already upon us.
The thing is, why didn't these great minds in Washington see this one coming? I mean, it was great when people were able to go to a real estate dealer or a mortgage person or a bank and, without a deposit, actually receive a mortgage on a mansion that they knew they'd just barely keep up the payments on. (I know, I ended it with a preposition - sue me!). After the bank had the family firmly ensconced in the house...maybe having made two or three payments...they raised the interest rates - something they promised they'd never do - to maybe two or three times what the original contract stated.
"You can't do that," said the family who supposedly "owned" the home.
"We just did," said the mortgage people.
"You'll have to pay it or get out!" was the answer.
So, eventually, they got out. They went to live with other members of the family - or on the street. The mortgage people didn't care. They now had the house.
Oops! Whom were they going to sell the house to? Turns out, there are others involved, don'cha know, such as Wall Street brokers and investment firms, to whom banks had already sold shares in that original contract. Here's where the story, essentially ends. Here's where the buck stops; Bear Stearns, Merrill Lynch, etc. They all lost billions and billions of dollars because nobody saw this debacle coming.
And this is where our federal government comes in; our pretty damned shrewd government. The people we love to hate. These representatives we elected - including the Executive Branch - are coming through at this moment of need with some cold, hard cash. It might be too late for some home owners who have had the banks foreclose on them, but, despite the fact that they got off their behinds too slowly, the Feds are coming through, at least to a degree. We're not down the tubes yet.
Some pundits are saying it's too little, too late, and maybe they're right. If you remember, two weeks ago, they were saying the $150 billion they'd give out would be in increments of $800 and $1,600. Well, that's already down to $600 and $1,200. Who knows? By the time the papers get on the President's desk to sign, it could be half the original amount!
I heard at first that we could start getting our rebate checks in late April, but, no, that's the time the Internal Revenue Service will be busy sending and receiving their regular taxes and returns; so that's no good. How about May? Well, May is when we'll be getting ready for summer vacations, y'know. Can't do it then can we? Perhaps June might be better. School will be getting out and...Ah, but Congress will be starting its summer break at that time too.
I wonder what the weather is like in Switzerland this time of year....