Seven Sons

Coming out of home depot yesterday I was reeled in by a lady trying to get signatures for two ballot initiatives. Trying to be the informed citizen, I asked her what they were about. One would prevent a government employer from acting like a union and collecting dues for political purposes. The other would prevent the legislature from imposing “hidden taxes” by passing new fees with a 50% vote instead of the 2/3 majority required to raise taxes. I told her I would think about it, but she didn’t want to let me go, saying, “it doesn’t really matter what these ballot measures are about, your signature just gets it on the ballot! You need to sign this to help us get it on the ballot, then you will be able to do all the research you need!” I told her I wanted less initiatives on my ballot, not more, and she looked at me like I had two heads. I walked away.

Photo credit to liberalstreetfighter.com

It is the ultimate strategy used by these paid signature collectors – they insist that you are just helping get it on the ballot, you aren’t voting for it. And most people can’t argue with that half-baked logic. So we end up with 10 to 15 measures on the ballot every two years, many of them just plain dumb, some of them directly contradicting each other, most of them entirely or partially unconstitutional, and the whole collection running the length of a small novel in the ballot guides we get in the mail. The ones that pass have two things in common: A very compelling title that may or may not have anything to do with the measure’s effect or intent, and a high pro- to anti- funding ratio.

There are three initiatives I would consider signing to get them on the ballot. One would call a Constitutional Convention to possibly scrap the encyclopedia-sized Constitution that we currently labor under in our state. Another would encourage clean elections by providing public financing to candidates who vow not to raise private money or spend their own fortunes. Finally, I would sign a ballot initiative to amend the Constitution and get rid of the initiative process. Hand me a pen.

The CA HealthCare Foundation has a nice write up of the history of the ballot initiative in California and a long list of problems with the system in its current form.

And it will be pathetic.  “We want to ask the American people what their hopes and dreams are”?  Spoken like a guy wanting to get in a girl’s pants, but then again they are certainly out to fuck us.

Look at the list of losers that will be leading this effort and taking the GOP show to the people.  It’s the same pack of narcissistic jagoffs that have been running the GOP in Congress for the last 5 years.  Why would anyone think they are capable of new ideas and new thinking?  They are like GM in the 70’s, 80’s and 90’s–”OK, so what you are telling me is that Buick is a piece of shit?  Great feedback.  Now, what if we painted it blue?”

     Okay,  I think it is pretty safe to say that I have never agreed with anything that any of the aforementioned nitwit CNBC analysts have ever said.  While we are a pack of tempermental bastards, they are a collection of immature, short-sighted, opportunistic, conservative, well, nitwits pretty well names them perfectly.

     However, I guess that like monkeys with typewriters and infinite time, one of them gets it right once in a blue moon.  Today, CNBC’s Rick Santelli had  a brilliant take

This subject has been boiling in my brain for a few weeks.  My wife and I are lucky to have a very nice upper income.  Hoever, we choose to live beneath our means.  If you go to one of those sites that helps you calculate how much house you can afford, we can afford about 3 times the value of our current home.  Why should those who live within their means bail out those who don’t?  Further, what about the renters?  Why should they bail out (through taxpaying) those who shouldn’t be homeowners but somehow are? Now, some of those homeowners who are in trouble got in trouble through no fault of their own.  But I don’t see a realistic way of sorting out the wheat from the chaff.  And, unlike Mr. Santelli, I do see the danger to the 92% of homeowners who pay their mortgages on time that the collapsing housing market presents.    

     All that said, the bottom line is the Obama  administration’s first stab at this is completely wrong.  Santelli (and sadly, Rush) get this one right.  It is the government rewarding bad behavior.  Here is how to solve this.  A bailout now with a built in pay back later.  The current plan would reduce the mortgage payments of homeowners in trouble to no more than 31% of their monthly income. My plan is as follows.  Suppose this means that  the mortgage has to be reduced from $200,000 to $150,000.  The federal government would take a lien on the  house for $50,000.  Eventually, the housing markets across the country will recover and begin appreciating again.  When the property was eventually sold, the government would receive 1/2 of any appreciation from the $150,000 figure.  In about 5 or 6 years, I would also start charging a 1% annual interest rate to preserve some of the value of the government’s lien.  Each time the house was sold, 1/2 the equity of any amount of the previous lien would go to the government until the lien was fully paid off.

     In my example, the lien would be $50,000.  The family lives there another 5 years and then sells the house for $170,000.  Normally, they would realize a profit of $20,000 over the  the $150,000 value of the home at its government-backed refinancing.  Instead, the homeowner would keep $10,000 and $10,000 would go to the government.  The new property owner would have a house worth $170,000 that had an additional $40,000 lien on it.  When that homeowner eventually sold, half of that homeowner’s profit would go towards the lien.  The lien could be paid off early with no penalty.

     I am aware that this is rather simplistic solution and that I don’t know enough of the mechanics of the  real estate market to get all the details right.  You have to figure out how to get the second and third buyer to be will to by a house at the value of the home and accept the continued lien.  Still, I think you could create a reasonable fair system along this basis that wouldn’t leave the responsible folks feeling like they’ve been suckers.