FW: New column: America needs debt counseling

A Conservative’s Viewpoint
By: Bob Steinburg

America needs debt counseling

“Dandy” Don Meredith, a former Dallas Cowboy quarterback and retired analyst from Monday Night Football, used to say: “If ‘ifs’ and ‘buts’ were candy and nuts wouldn’t it be a Merry Christmas?” I used that quote last week during a conversation with employees of the dealership servicing my car.

As is my custom, I use the waiting time to visit the showroom and talk to shoppers, sales personnel and management. My kids often joke I’d talk to an open mail box. On this day, I was the only customer. In fact, I noticed but a few employees.

“How’s business?” didn’t seem to be an appropriate ice breaker. I might have surmised everyone was out for lunch or that this was but a momentary lull. Given the time of day and our country’s economic morass, I knew better.

This is a very large Big Three automobile manufacturer’s dealership. I asked the general manager if the $3 billion federal “Cash for Clunkers” had been a success for him. He said the program was probably unnecessary at best and a bad idea at worst. He cited gas guzzling pickup trucks and SUV’s being traded in for newer models that increased mileage by only 1-3 miles per gallon; this in spite of a program that was not only to stimulate sales but to get the gas hogs off the road.

The manager discussed other negatives. Similar to the mortgage crisis where home buyers were “qualified” to purchase homes they couldn’t afford, some car buyers are finding themselves in the same boat. “What was I thinking of,” is a frequent comment. “I can’t afford these payments,” is another. What does that mean for economy down the road?

Many auto dealers now have to send their banks all of their financial information every day. Banks who floor plan (finance) dealer inventory used to visit the lots three to four times a year to count their cars. Some are now showing up three times a week. If the economy is beginning to turn around, this is hardly a sign of banker confidence.

With all of the so-called programs to loosen credit, it isn’t happening. I was told about an 80-year-old customer who had financed many cars through this dealership. Now she was unable to secure financing for her new car. Her credit score was exemplary (800 plus). She owned her own home. Her credit report didn’t have a blemish. Because she was not employed the bank required a 50 percent down payment before they would approve her loan. This isn’t only tough on the customer, but the dealer who is trying to survive.

Many attempting to refinance their home are trying to overcome similar hurdles. A friend with a credit score of 740 (very good) was unable to secure refinancing. “The banks didn’t even want to talk with me,” she said, “and I have a good job.”

Responsible taxpayers, both individual and corporate, many with good credit, had their tax dollars go toward bank bailouts. Yet now some of those individuals find the bank doors being slammed in their face. Either the banks have calculated that things are much worse than we’ve been told, or they are scrambling to pay back bailout money to escape further government scrutiny.

It’s not just the folks who are uneasy. The business community is equally anxious. Passage of the pending Healthcare Reform Bill and the looming Cap and Trade legislation can only further exacerbate a situation that has many businesses already wheezing from over taxation and regulation. Those struggling to retain old jobs and hopeful of creating new ones will only be further hampered by these two additional burdens, perhaps making both business objectives little more than an opium pipe dream.

As we reflect on Christmas past, we as a nation have experienced great abundance. While not all have shared equally in our national bounty, the lives and welfare of most Americans have improved with each succeeding generation. In my view, it’s a mistake for our leaders to risk all by further emasculating our capitalistic engine.

As a child, I awoke one Christmas to find a “Tinkertoy Construction Set”. This plaything was designed to inspire children to use their imaginations by taking their basic knowledge and common sense one step further. Dad said, “Son, you always start with what you know and then begin to build or rebuild from there.”

America’s done a pretty good job of adapting to that principle. In the process we created a template for commerce that has served us well. It’s only broken now because members of both parties of Congress haven’t always played by the rules. Yet instead of getting back on track, liberal and progressive Democrats are curiously abandoning the concept of individual and corporate freedoms, liberty and economic opportunity in exchange for conditioning citizens to become followers instead of leaders and in the process making us more dependent on the state instead of less.

We can “if” and “but” and try various purported spending cures for our malaise until the cows come home, when in fact the cure for what ails us is as obvious as the nose on our face. Freeze spending immediately which will axe any spending initiatives that are not fully capable of being self supportive from day one. We must address the debt that continues to chaff at the loins of our independence. China alone holds $1 trillion of our national debt and another trillion in dollar reserves. They already have us in a chokehold and if we continue to borrow, we’ll eventually fiscally blackout.

Unless we immediately begin acting as if our sovereignty and freedom depend on our financial independence, we will not only risk becoming wards of our state, but perhaps worse, wards of China.


gruaud said...

"Yet instead of getting back on track, liberal and progressive Democrats are curiously abandoning the concept of individual and corporate freedoms, liberty and economic opportunity in exchange for conditioning citizens to become followers instead of leaders and in the process making us more dependent on the state instead of less."

I had to wait for it, but sooner or later this
dingleberry was going to blame liberals.
It's like a reflex with these people.

The corporations (particularly the Wall St
financial houses) are already way too free,
and that's precisely why we are in this mess
in the first place.

And who deregulated any fiscal sanity out of
these institutions? BOTH democrats AND

But only democrats are held accountable, right?

This is why I can never take you guys seriously.

Anonymous said...

This guy sure is a slow writer. It took him almost 8 years to complain about the huge deficits that the federal government has been running up.

And according to who is "cash for clunkers" a bad thing for car dealers? Ford actually turned a quarterly profit because of the program. As for people buying too much car because of the program, perhaps he could let us know what caliber of gun was held to their heads to make them purchase a new auto.

I love the story about the unemployed lady who can't get a car loan. This whole time I thought the unemployed were bad credit risks! Its a no win situation: if they don't give her a loan its a sign that the market is bad. If they do then its just more irresponsible lending to bad risks. A lovely Catch-22.

Anonymous said...

BTW I love the BS title about credit counseling. Do you know what they do in credit counseling? They tell you to spend less and bring in more income in order to try and control your debt. Perhaps we could spend less on wasteful foreign wars and corporate handouts and tax the rich more, and that would solve our deficit problem right there, correct?

I don't anticipate this author would adopt this same view.

ferschitz said...

Phoning it in today: agree with the three prior posts. It's getting boring having to refute the same old corporatist Republic b.s., where the Democrats are reflexively blamed for everything.

Read Paul Krugman's editiorial in the 12/14/09 NYT: "...talk to conservatives about the financial crisis and you enter an alterntive, bizarro universe in which gov't bureaucrats, not greedy bankers, caused the meltdown. It's a universe in which gov't-sponsored lending agencies triggered the crisis, even though private lenders actually made the vast majority of subprime loans..."

Republics still don't want to regulate the banking industry, and news reports are out there about how three days before a House vote on Banking reform, Republic leaders met with more than 100 finance-industry lobbiests.

Spare me the incessant blaming of Democrats. It's done solely and only to put more money in the pockets of Republics, who could care less if the USA continues it's ongoing slide into being a 3rd world country.

Anonymous said...

Freeze spending immediately!

Oh yes, let's do that! By all means!

I have no doubt that government empoyees not getting their paychecks will have a wonderful effect on the economy! (Not to mention on the troops' morale - not having a paycheck or anything to eat will really support 'em!)

And the economy will get even better when stuff like public transportation, law enforcement, roads, bridges, tunnels, education, sanitation, food saftey, hospitals, emergency services, and god knows what else all implode without federal funding!

And those people on food stamps? No worries - they'll be content to quietly watch their children starve to death, and won't DREAM of trying to steal food - especially once most of the cops are laid off! The federal prisons? Why, the inmates can police themselves - who needs funding?

I'm also sure that the lack of safety regulations and sanitation will make people go "whew - at least we're not in debt!" as they watch family members die in workplace accidents and from contaminated food! And the loss of all public heath programs (what little we have) will help make America even greater, once a real pandemic hits!

Education? Pay for it yourself! You can't afford it? Well, then homeschool!

What do you mean, you both work? You're not paying any taxes! Surely the few thousand dollars you save should enable you to buy everything the government used to provide!

Of course, we'll "reinstate" those things that are "self-supporting". Which means what, exactly? Here's a newsflash for you: the reason we use tax money to pay for this stuff is because it's NOT "self-sustaining", and becuse it will cost a hell of a lot more to "pay for it yourself". Try paying for all of the above without taxpayer money - I dare you!

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