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Publisher’s Notebook:

The Santa Monica Mirror chooses Barack Obama (D), John McCain (R), and Cynthia McKinney (G) for their respective party’s primary nominations for President of the United States. Obama because he brings the opportunity for a real break from the past and true change, McCain because what you see is what you get and he is not going to be kowtowing to Christian evangelists, and McKinney because she helps the Greens stay active by being yet another interesting candidate that provides a wholly different perspective (Kucinich, you listening?).

Vote Yes on Measure R; let’s secure additional local education funding.

Vote Yes on Propositions 94-97, Indian Gaming: This deal is not great and favors only the big casinos. It would be better to have the Assembly strike a better agreement, and force Indian gaming to allow unions. But…it is good enough.

Vote Yes on Proposition 93, Term Limits: We need fresh faces in the house primarily because there are no real choices for the electorate. Once elected, members have a 95 percent re-election rate, not a good thing. We like to see fresh faces and voices participate. That being said, we also must treat our politicians like professionals and give them the time to do their jobs properly.

Vote Yes on Proposition 92, Community College funding changes: Lower tuition fees bring more students with a big payoff for society. Not a perfect fix, as by decoupling it from K-12 mandates, lower grades may get hurt financially. Ultimately, the state has got to get its finances straight and fully fund all education.

Vote No on Proposition 91. Here is how the San Francisco Bay Guardian put it: “It should be clear to everyone at this point that the widespread overuse of automobiles is having far bigger impacts on California than just wear and tear on the roads. Cars are the biggest single cause of global warming, and they kill and injure more Californians than guns do, causing enormous costs that are borne by all of us. Driving a car is expensive for society, and drivers ought to be paying some of those costs. That should mean extra gas taxes and a reinstatement of the vehicle license fee to previous levels (and extra surcharges for those who drive Hummers and other especially wasteful, dangerous vehicles). That money ought to go to the state General Fund so California doesn’t have to close state parks and slash spending on schools and social services, as Gov. Arnold Schwarzenegger is proposing.”

 

Vote Yes in Los Angeles on Proposition S. It is a reasonable surcharge that will directly help police and fire. Plus, if Chief Bratton says it is good enough, who are we to argue.

 

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Last week I spoke with two “dads” and influential citizens who reminded me of how great their respective girls’ basketball teams were doing. Patrick McCabe told me we needed to make note of the New Roads team, and Chris Harding told me of a great upset victory by the team at Samohi. Somehow, I mixed the two teams up, so please pardon the mistake. Congratulations to the Samohi girls for their victory over Ayala High School, 66-44.

 

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Looks like the trees on 2nd and 4th Streets are not going to survive the city’s desire to cut them down. Right now, the vote on the council looks to be 6-1 in favor of saying bye-bye to at least half of our wonderful tree canopy. Only Kevin McKeown, the former Green party member, is in support of saving the trees.

 

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I find it amazing how little attention has been given to high interest rates charged by banks. If you really want to put money in people’s pockets, then revise the banking legislation that Hillary voted for, which allowed banks to charge up to 30 percent interest. I find that rate criminal, and am impressed that Barack Obama had the good sense to wriggle out of voting for it. If I loaned a friend money with a repayment schedule in the State of California, I would be restricted to 10 percent interest rates. How in the world did we let the banks get away with this usurious conduct? On top of that, they also have the ability to charge late fees and change the agreed-upon rate as a result. Then they protect themselves with new bankruptcy laws that restrict what can be discharged.

If the goal of national legislation is to put money back in the public’s hand, like a tax rebate check, which is really just our own money, how about forcing a bank moratorium on interest rates. THIRTY PERCENT is indecent; bring the rate back to rates that are reasonable. Otherwise we are heading down the same subprime mess on credit cards that we have found ourselves in with home loans. At least with subprime mortgage loans, cheap rates allowed people to buy homes. With credit cards, people are buying consumable items having nothing solid to show for it in the end. The old interest rate was 18 percent, which is still too high considering the banks are getting money at around three percent. How much margin does one need? Even 18 percent, however, would lower the extreme gouging. I would also forbid late fees, which, when calculated, are just another form of a high interest rate, and I would prohibit changing rates unless there was sufficient cause, like six months of late payments. Imagine the billions of dollars credit card holders would save if the banks acted reasonably. The banks have been enjoying a “bank holiday” the last several years, but they need to be reigned in.

As for the subprime market, I would legislate actively to prohibit foreclosures, by the simple act of allowing the original loans to remain constant for an additional 24 months. No rate conversions to exorbitant levels. That would buy people the time to work their way out of the mess, home values to stabilize, and the banks the time to provide mortgages that can work. There are plenty of sufficient workable fixes; they just need the political will to move on them.

The Federal Reserve is doing the right thing by lowering interest rates. The key question, however, will be if the banks pass those savings on to consumers and businesses. Key business borrowers will now see some relief in their bank loans, and it is possible, with pressure, to see long-term rates come down so home mortgage holders see relief on those loans as well. Auto loans can go lower, bankcard debt can be reduced, and all these items will be useful in stemming the harm caused by shaky real estate loans that never had any hope of being serviced properly. The government needs to enact policies that bolster home ownership with rules that keep values high and building up.

One thing that is important to getting the economy on track is reliable mortgage loans. It was good to see Countrywide actually starting to advertise again. Now that BofA has bought them, there will be legitimate and regular loans to be had. There is a lot of new housing stock going unbought for the simple reason that people are unsure of the future and are not being offered loans that help first-time homebuyers. I think there are plenty of ways to offer loans that help in this regard without putting lenders and homebuyers in jeopardy. One major influence is people’s faith that housing prices have hit bottom and what they do acquire will eventually rise in value.

In our community, the big task will be to combat fear and the mass hysteria to hold back on spending, hunker down, and be more timid in business expansion. If we can take our natural entrepreneurial drive and apply it to the businesses we own and manage, there are plenty of opportunities to work on. I would also recommend putting government infrastructure spending on the fast track. We have unspent bond funds and city projects ready to roll, and all go to help boost our local economies. Two big sectors of growth are education and health, and a lot of money is being spent at St. Johns and Santa Monica-UCLA. Let’s continue to encourage our medical industries to grow. SMC also has projects in the works, and if they fast track them, money can be pumped into our local economies. Same thing holds true with our local educational community and BB funds. The key is to act.

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