Gov Brown and JP Morgan

[SmokinBBC]

Interesting perspective:

California Gov. Jerry Brown is worse than JP Morgan's CEO Jamie Dimon


By Michelle Selesky

Published May 15, 2012

FoxNews.com




With the startling news last week of JP Morgan Chase's $2 billion trading loss and the attention the bank has earned in the fallout from politicians, the news media, and even President Obama, it is all the more startling to notice, in comparison, just how little attention California Governor Jerry Brown has received for his $16 billion deficit blunder.

Even worse, Governor Brown's financial loss will foot the bill to California taxpayers, whereas JP Morgan's mistake was only a hit to the bank and its investors.

Following Thursday's announcement of the bank's massive trading loss, media coverage has been extensive.

JP Morgan CEO James Dimon joined host David Gregory Sunday on "Meet the Press" to account for his role in the mishap, confessing to "errors, sloppiness and bad judgment" that led to the massive loss.

Congressman Barney Frank, a sponsor of the 2010 Dodd-Frank financial reform bill, showed up Sunday on ABC's "This Week" to make the case for increased regulation of derivatives trading and to skewer Republicans for their carelessness and support of less regulation.

On Monday, even President Obama came out to say that the JP Morgan loss is an example of the need for more regulation of Wall Street.

All in all, the loss of $2 billion of investors' money by JP Morgan is dominating the news cycle, has put CEO James Dimon on the chopping block, triggered the resignations or "retirements" of high-ranking staff, and incited politicians from both the left and right to do battle over regulation.

Yet, at the same time, there was another news story over the weekend that has, in contrast, received much less attention than the J.P. Morgan circus. On Saturday, California Governor Jerry Brown announced that his state's projected budget deficit will not be $9 billion as he originally predicted in January, but instead $16 billion. That's a $7 billion accounting error.

To make up for this gap, Governor Brown is handing the bill to California taxpayers, proposing to raise taxes to pay for the deficit when Californians are already suffering from painful 11% unemployment.

To be clear, Governor Jerry Brown's miscalculation is costing California an additional $7 billion – an amount three times that of JP Morgan's recent loss. His total deficit, $16 billion, is eight times greater than JP Morgan's error.

But despite the failure on the part of Governor Jerry Brown, the usual suspects in politics and the media, who are seemingly always so concerned about accounting and regulation, are silent.

Where is the political scrutiny?

Where is the fallout?

Where is Barney Frank calling for more accountability on the part of Governor Brown when it comes to managing his state's budget?

When it comes to California's governor it is doubtful that he, unlike JP Morgan's top leadership team, is considering handing in his resignation on account of his irresponsible mathematical error.

 

[BBShark]

From WSJ

It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of the states. The not-so Golden State now has an incredible 2.4 million government employees

Welcome to the de-industrialization of the US. In 10 years, China will surpass the US as the largest economy in the world. At the current rate the federal government is borrowing money from China, more than half of our tax revenue will go towards just making the interest payment on the debt (it as already the second largest expense).

So California is probably just as irresponsible as the federal government. California is looking for a windfall from the Facebook IPO. Let me see, Facebook makes money on internet advertising. Buying products made in China so that they will have (what used to be our) money so that we can borrow (what used to be our) money from them.

The definition of crazy.

 

[big2bird]

Sounds like a lot, huh?
There are 37,000,000 people in California. If each one gave the state $1.25 a day for a year, the budget would be balanced. Just the sales tax on 2 gallons of fuel a day would pay that.
The fifth largest economy in the world was just dragged down the tubes with the rest of the country.
Government, like construction, is based on growth. It is painfull to adjust to any reversal of that growth.
I cannot wrap my head around blaming any one person/thing for the mess.
We just need to learn, adjust, and go on.

 

[SmokinBBC]

Bird, there is no learning, adjusting and moving on.......there is just more spending by the goverment. Why, because it is only a few cents a gallon or 1.25 per day per person for a year........

"You need to reduce your spending.....quit digging into my pocket to pay for your fiscal mismanagement" My favorite quote!

 

[BBShark]

Bird, there is no learning, adjusting and moving on.......there is just more spending by the goverment. Why, because it is only a few cents a gallon or 1.25 per day per person for a year........

"You need to reduce your spending.....quit digging into my pocket to pay for your fiscal mismanagement" My favorite quote!

AND....if the Cali gov't actually got the extra $500 per year from every man woman and child in the state, they would use up that money and spend some more (that they don't have).

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

"it's a spending problem, not a revenue problem"

 

[denpo]

I won't debate on numbers with you guys,
but I'm not sure you can compare a Bank and a State.

Bank's job is to maximise profits regardless of the social cost.
State's job is to balance budget to maximise social profits.

 

[big2bird]

Bird, there is no learning, adjusting and moving on.......there is just more spending by the goverment. Why, because it is only a few cents a gallon or 1.25 per day per person for a year........

"You need to reduce your spending.....quit digging into my pocket to pay for your fiscal mismanagement" My favorite quote!

AND....if the Cali gov't actually got the extra $500 per year from every man woman and child in the state, they would use up that money and spend some more (that they don't have).

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

"it's a spending problem, not a revenue problem"

I understand, and I agree. What I am saying is that the budget deficit is a direct result from reduced revenue, not new spending.
The state has lost that revenue due to people spending less, like 2 gallons a day, and that has caused the defecit.
The topic was $16 billion in shortfalls. All I pointed out was how little it takes to create that amount of money. Hell, if just 10 million people stopped playing the lottery for $1 every game, that would cause a 1 billion dollar loss in revenue.
Compared to what the military pisses away in one day, it's zippo. Nada.

 

[big2bird]

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

Just for fun, flip your logic of earlier. :idea:
We spend our money in China, which loans us the money, and we pay them.
If we spent more money on government, for employees, that would increase the money invested here, and decrease spending at Wal Mart, therefore decreasing the trade defecit.:tth:

So, what do we do without? Police? Fire departments? Parks? Road repair? Freeway expansion? Is there waste? Sure there is. But once a department has a budget, they always find a way to justify it.

Believe me , I don't like the system. However, I don't care for the blame game. Let's work the problem. It is just so overwhelming, I don't know where I would start.

Gene's solution is just to radical for me.

 

[big2bird]

"You need to reduce your spending.....quit digging into my pocket to pay for your fiscal mismanagement" My favorite quote!

Here is food for thought. Because 12 radical Muslims managed to pull off a horrible stunt, we now have a military budget unsurpassed, two wars we don't need, a new department of homeland security that gets WHATEVER they want, and TSA pats down little girls and old ladies in wheelchairs.

Talk about over reacting. The pendulum needs/must swing back in favor of sanity, or the terrorists have won, and we just live in fear.

 

[big2bird]

BTW, I just jumped into this to point out that no one could foresee what was going to happen, and how little it takes to make a big problem.
:devil:

 

[BBShark]

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

Just for fun, flip your logic of earlier. :idea:
We spend our money in China, which loans us the money, and we pay them.
If we spent more money on government, for employees, that would increase the money invested here, and decrease spending at Wal Mart, therefore decreasing the trade defecit.:tth:

So, what do we do without? Police? Fire departments? Parks? Road repair? Freeway expansion? Is there waste? Sure there is. But once a department has a budget, they always find a way to justify it.

Believe me , I don't like the system. However, I don't care for the blame game. Let's work the problem. It is just so overwhelming, I don't know where I would start.

Gene's solution is just to radical for me.

Californias budget problem is based on historical budgeting that forecasts 8-10% increases in revenue. That's nuts, revenue for California is down about 20% from 4 years ago. So they keep spending money at a greater rate regardless of whether the revenue will be there or not.

And as far as the government spending money vs. people spending thier money, there is no question that people spending money is better. 70% of the economy is consumer spending. Consumer spending creates wealth, government spending creates debt.

 

[big2bird]

Californias budget problem is based on historical budgeting that forecasts 8-10% increases in revenue.

I agree. My first statement was that government, like construction, is a growth industry. Steered by the Corporate "Committe" mentality, it reacts, versus plans. It's cover your ass, not my fault, not "vision."

As the baby boomers age, and retire en mass, the system will collapse, due to stealing from SS thru the years.

The American mentallity, of immediate satisfaction, versus the Asian mentallity of planning for the future, will be our downfall.

 

[BBShark]

Californias budget problem is based on historical budgeting that forecasts 8-10% increases in revenue.

The American mentallity, of immediate satisfaction, versus the Asian mentallity of planning for the future, will be our downfall.

I think the American mentality is entitlement, as stated before, we have become a nation of takers not makers.

Our downfall will be the governments deficit spending. We are putting the US dollar's status as the "reserve currency" of the world in serious jeopardy with this debt. If we lose that status, it will signal the complete collapse of the dollar and the US will become a second rate economy.

 

[mrvette]

I won't debate on numbers with you guys,
but I'm not sure you can compare a Bank and a State.

Bank's job is to maximise profits regardless of the social cost.
State's job is to balance budget to maximise social profits.

What 'social cost' vs 'social profit' are you thinking of???

there isn't any on either side, it's a figment of the PROGRESSIVE/Liberal/socialist mindset....


Honestly I too tired to respond this evening to the rest of the posts....

but ASSuming this goes on, I will.....today been a long day....fucking damn pickup trucks....

:shocking::crap:

 

[DeeVeeEight]

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

Just for fun, flip your logic of earlier. :idea:
We spend our money in China, which loans us the money, and we pay them.
If we spent more money on government, for employees, that would increase the money invested here, and decrease spending at Wal Mart, therefore decreasing the trade defecit.:tth:

So, what do we do without? Police? Fire departments? Parks? Road repair? Freeway expansion? Is there waste? Sure there is. But once a department has a budget, they always find a way to justify it.

Believe me , I don't like the system. However, I don't care for the blame game. Let's work the problem. It is just so overwhelming, I don't know where I would start.

Gene's solution is just to radical for me.

Departmental budgets are based on what was spent the previous year. If the department saves "X" dollars then they lose that amount of funding for the next year. It is a disincentive for any department to save money. All departments must spend all of their money and then some to ensure that they get fully funded for the upcoming year.

 

[SmokinBBC]

At this point in time, "fiscal management" will need to be about doing without...

The math doesn't work bird; don't know about the figures you quoted...37 million people of which 18 million could work....but 11% of them are unemployed? Sounds like the accountants Brown used:tomato:

There may be many solutions to the problem....think about your average family. What do you do if you lose some revenue stream? You have options...cut your food budget, eliminate the cell phone, reduce the number of times you go to the movies, sell some of your assets, tap into your savings fund, get another credit card....I could go on and on....just remember 3 facts, cash runs out, credit DOES have a limit and bankruptcy forces austerity.

How we got here? Well it's everyone elses fault....just ask any politician.

 

[mrvette]

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

Just for fun, flip your logic of earlier. :idea:
We spend our money in China, which loans us the money, and we pay them.
If we spent more money on government, for employees, that would increase the money invested here, and decrease spending at Wal Mart, therefore decreasing the trade defecit.:tth:

So, what do we do without? Police? Fire departments? Parks? Road repair? Freeway expansion? Is there waste? Sure there is. But once a department has a budget, they always find a way to justify it.

Believe me , I don't like the system. However, I don't care for the blame game. Let's work the problem. It is just so overwhelming, I don't know where I would start.

Gene's solution is just to radical for me.

Departmental budgets are based on what was spent the previous year. If the department saves "X" dollars then they lose that amount of funding for the next year. It is a disincentive for any department to save money. All departments must spend all of their money and then some to ensure that they get fully funded for the upcoming year.

All you all wooden believe me anyway, if I told the actual DeFacto budgeting and the internal spending controls in the typical FED.gov agency....I bet it's nearly identical for the states....

It's borderline criminal....

It is a RARE .gov agency that spends at an even rate, what happens is they spend less and less through Christmas season and through spring time, but by summer they know they have in FACT spent less to get their 'job' done, and so to use up their annual budget by approximately October, long come end of summer/September...they are dumping all the funds so that they look 'Good' for the next annual budget INCREASE....what a scam....

Don't forget, I spent 53 years in the Wash DC region, most all my friends were FED.gov workers, or married to one, as was I, and the stories at various parties and shit through those decades....were mind boggling, and greatly repetitive, from agency to agency....

:shocking::blush::crap:

OH, edit, MY solution has been far less radical in print than it actually would be....Jeff, you got NO clue.....I stone serious about firing 40% of the federal work force....and not touch DOD....

As in shut down the buildings, clean out the furniture, erase every disc they ever created, and dump the mainframes, sell to China for scrap....their entire functions are eliminated....the land of DIWK house hold incomes of +250k/years and 500k ~2000' houses comes to a close....

 

[big2bird]

Let's not forget. It would be better for the California economy for the individual to spend that $500 in the economy than give it to government which is wasting it.

Just for fun, flip your logic of earlier. :idea:
We spend our money in China, which loans us the money, and we pay them.
If we spent more money on government, for employees, that would increase the money invested here, and decrease spending at Wal Mart, therefore decreasing the trade defecit.:tth:

So, what do we do without? Police? Fire departments? Parks? Road repair? Freeway expansion? Is there waste? Sure there is. But once a department has a budget, they always find a way to justify it.

Believe me , I don't like the system. However, I don't care for the blame game. Let's work the problem. It is just so overwhelming, I don't know where I would start.

Gene's solution is just to radical for me.

Departmental budgets are based on what was spent the previous year. If the department saves "X" dollars then they lose that amount of funding for the next year. It is a disincentive for any department to save money. All departments must spend all of their money and then some to ensure that they get fully funded for the upcoming year.

All you all wooden believe me anyway, if I told the actual DeFacto budgeting and the internal spending controls in the typical FED.gov agency....I bet it's nearly identical for the states....

It's borderline criminal....

It is a RARE .gov agency that spends at an even rate, what happens is they spend less and less through Christmas season and through spring time, but by summer they know they have in FACT spent less to get their 'job' done, and so to use up their annual budget by approximately October, long come end of summer/September...they are dumping all the funds so that they look 'Good' for the next annual budget INCREASE....what a scam....

Don't forget, I spent 53 years in the Wash DC region, most all my friends were FED.gov workers, or married to one, as was I, and the stories at various parties and shit through those decades....were mind boggling, and greatly repetitive, from agency to agency....

Gene, that's really not a big secret.:amused:

 

[DeeVeeEight]

Governments' solution to all this nonsense will be to dump a couple of million dollars into a study that tells us what we already know, and/or puts such a dizzying spin on things that it requires a new multi-million dollar investigation.prrtt:

 

[mrvette]

Governments' solution to all this nonsense will be to dump a couple of million dollars into a study that tells us what we already know, and/or puts such a dizzying spin on things that it requires a new multi-million dollar investigation.prrtt:

:beer: Got THAT right, and Mitt would be just the RINO to do it too....

:shocking: