Bailout Power Grab, Abuse of Power in New York and Rising Sea Level Panic
White House economic advisers plan to convert government holdings in bailed out banks to common stock, increasing direct government control.
New York State insurance chief Eric R. Dinallo launches an investigation into Allstate’s business practices.
Newspapers report that rising sea levels due to global warming are causing people to flee low-lying islands.
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1. BUSINESS
White House economic advisers plan to convert government holdings in bailed out banks to common stock, increasing direct government control.
CEI Expert Available to Comment: Special Projects Counsel Hans Bader on how the Administration’s plan could backfire:
“…there are big pitfalls in practice, since common shares, unlike preferred shares, vote on who manages the company. The government could use its votes to make banks waste money on ideological causes — the way it recently did with Freddie Mac, in order to promote mortgage relief for even high-income borrowers, and is now attempting to do with banks that lent to automakers, in order to bail out the United Auto Workers union. Or it could use its new power over corporate management to bail out politically connected Wall Street firms — as it did with the AIG bailout, gave billions of dollars to wealthy customers of AIG like Goldman Sachs, a wealthy Wall Street firm which was in little danger of going bankrupt.”
2. LEGAL
New York State insurance chief Eric R. Dinallo launches an investigation into Allstate’s business practices.
CEI Expert Available to Comment: Senior Fellow Eli Lehrer on why the investigation may be politically motivated:
“Dear Superintendent Dinallo: It appears that you are abusing your power. You should stop… Your actions raise the specter of illegality and we hope that some of the companies that you have taken to harassing will do the right thing and file a lawsuit against you and your department…Even if it is not illegal, your blatant retaliation is morally questionable and challenges the bedrock principles of our democracy. You should withdraw your threat to investigate Allstate and stop your efforts to intimidate other insurers.”
3. ENVIRONMENT
Newspapers report that rising sea levels due to global warming are causing people to flee low-lying islands.
CEI Expert Available to Comment: Senior Fellow Christopher C. Horner on the real state of sea levels:
“The rate of sea-level rise – which began after a period known as the Little Ice Age – proceeded steadily from about 1850 until 2007, without accelerating. Since then, satellite data have affirmed that the rate peaked in 2005 and that levels even have dipped slightly. Sea levels around the [island nation] Maldives have dropped appreciably in recent decades.”
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