Not this bailout

When you add the interest, because this make and sold $700B money is borrowed from the banks, and then add in the fees they'll charge to figure out what home values are relative to their toxic mortgage, the cost will be $3T.

Gas prices by raising costs 25% pushed stupid negatively amortized keeping-up-with-the-jones families over the edge on the outer rings of sprawl nation. And as these home compete in the foreclosure market, and future gas prices and related food and energy prices rise, the effect of increased poor quality inventory, will continue to be felt in declining home values.

So if a bailout is to occur it should change the way we do business, particularly the fossil fuel economy of the warfare state, that brings us to this stage, with incentives for walkable cities and penalties for a jobs housing imbalance. Interesting to see that houses on the outskirts of the driving economy, like Modesto, Merced and even the suburbs of Sacramento, if you google foreclosure and put in a destination like North Fairoaks, will show houses in the 50ks which is no where near where housing prices are in San Jose or SF, are, an equivalent price decline putting values at 220k; while Cheney is still having wet dreams over sending our kids to Iran. The papers are full these days about hedge funds. If I draw up a list of the first hundred people I'd care to talk to tomorrow not one is in a hedge fund. So who are we bailing out and why not do something useful to help people get local jobs and walking access to services and food.

We actually have affordable housing these days. And 5 to 7% unemployment is not horrific. And there are many good solutions out there. For example the government could take a house before foreclosure and negatively capitalize it. i.e. take the loss in value plus 10% (for a down payment if necessary)and park it, until the house is sold (the same way a senior can borrow from a house until they die and then the sale pays back the loan). Simultaneously reduce the mortgage by the parked value and fix the rate to the new mortgage less 10%. Very little out of the government's pocket, it keeps people in their homes, and when the market stabilizes (not recovers, because just as pets.com is not coming back, so this housing bubble is not going to realize the same high prices as before in our life time; and on another topic its all relative) the government can share the loss with the lending authority. Amortize and defer in other words.

There are other more complicated schemes out there like this one by Stiglitz who projects in addition that the $3T cost of the Iraq war will hamper future generations for decades.

The majority of the "market drop" is not related to the fundamentals but to hope that this administration's scorch and burn policy can once more allow their funders on Wall Street, of what Norman Solomon in Made Love Got War calls the Warfare State, to once more bank on their irresponsible actions.

This looks like the Japanese Economy (which looks like it foretells us by about 5 years), the bubble in the late 80s and 90s was similar to the 1920s. Many sane heads have been saying for twenty years that we should reduce debt and address the consequent ecological problems like dead seas and fish stocks and poisonous air, and depleted resources like oil and water, which lead to conflicts like Iraq, and Darfur.

population consumption and equity

Paul Ehrlich and other population experts debate the consequences of a crowded world, and how a McCain administration could set back decades of progress.

Its good that in the beginning they all agreed that the problem is consumption not population and in particular the type of consumption. Connell solution of living in larger households was mentioned by the Archbishop of Cantebury. And they all agree on the need for women's education.

The most interesting aspect of the discussion, is this kernel of equity, that floats through the discussion and is not really fleshed out. That challenge is before the world community today- that a workable climate treaty must bridge the gap between the affluent and the aspiring. Erlich hits on equity on page 2 of the salon article, but from a charitable standpoint- the generous american "We need to see that all the people have enough to eat and have decent shelter, water and medical care."

The third world is far more aware that the imperial consumption of the west brings resource supplying dictators and storms and droughts into their part of world and creates poverty by displacing sustainable systems for resource annexation. Charity is not what they need with the coddled Musharraf's of the world; they need an equal share of the resource basins, like air, which sustain life. If the cost of polluting (i.e. development) the biosphere (i.e the sum total of resource basins) were equitable, then we have a solution to Erlich's followup posit: A much tougher problem is what to do about everybody wanting to consume like Americans, and have an SUV.

The rest of what they say on education etc is just more details, but without bridging the gap, its not going to work, because some will make money of poisoning someone else's food or water or air basin and in the process offer the wrong model of development for the survival of the species.

Erlich comes across as a rabid right wing social engineer and Connell as a leftist pro human rights social engineer. Without equity you have an imbalance that requires engineers! And its also where these guys go overboard- instead of preserving the natural wealth (benefits of wild lands) in the resource basins of subsistence societies with an ownership model, like ILO 169, they see poverty and want their development model imposed on it. Though to their credit they don't quite say that- I'm reading it in between the words wealthiest and subsistence- when they agree to "take the wealthiest lawyers and bankers and send them to subsistence societies."

Erlich's defense of the Population Bomb was very forceful- applied to the US. Don't preach, practice. A home grown solution to a domestic problem. It put Connell on the defensive- and arm chair quaterback who though that the study was his end all. At which point the discussion actually turned into a debate.