Category Archives: Politics

April 28, 2009 · 6:38 pm

Earth Day

As I write this another Earth Day has come and gone. It began in Philadelphia in 1970, supposedly started by Wisconsin Senator Gaylord Nelson and has, over the years, grown into a worldwide movement. I say supposedly because a man by the name of Ira Einhorn, a sixties radical–hippie, guru, anti-war activist and darling of the left–claimed to be the founder himself. He was at least a key organizer and MC of the first event, but was later disowned by the movement for his inconvenient killing of his girl friend, Holly Maddux. This was discovered 18 months after he had stuffed her body in a steamer trunk and stored it in his apartment. The neighbors finally complained about the smell and liquid dripping through the ceiling. Talk about an environmental issue. Ira had plenty of defenders on the left and managed to get out on $40,000 bail whereupon he promptly disappeared. In the 80s he turned up in France and avoided extradition until the late 90s when he was convicted and sent off to jail.

I would be the last to dispute that Earth Day and the raising of concern about the environment has done a lot of good over the decades. Much has been accomplished: the air and water have been cleaned up, sewage issues dealt with, spills of noxious chemicals stopped, mining waste controlled and landfills better managed. Although from the crap you see strewn along the highways and the graffiti on every flat surface in major cities (like this river in Manila), you get the feeling that not everyone has gotten the word.

I have always thought of myself as a “conservationist”. Indeed, my major in college (marine biology) fell under the supervision of the Conservation Department at Cornell. But, who doesn’t support clean air and water as well as the wise stewardship of our natural resources? I would not like to be called an “environmentalist” however. They have gone off the deep end with another agenda. As Stephen Hayward of the Pacific Resources Institute and author of the annual “Leading Environmental Indicators” states, “The environmental movement has been taken over by anti-capitalists and extremists. The agenda is now pulling down market economics, raising up central planning for egalitarian goals, forced lifestyle changes and the vilification- in hopes of eliminating- signs of wealth. Ironically, the creation of wealth allows the resources to invest in clean up.”

Indeed, the constant drumbeat that the environment is in grave danger from the left and the media has been effective. A poll commissioned by Habitat Heroes and conducted by Opinion Research found that 75% of blacks and 65% of Hispanics believe the planet will be irrevocably damaged by the time they reach adulthood. The schools have been drenching the children in eco-propaganda, laments Meghan Cox Gurdon in a piece for the WSJ (Taste Page, 4/17/09). This, she asserts, “causes stress that their smallest decision could have catastrophic effects on the globe.” [Another great article by the same author.]

She points out that children’s books have gotten in on the act. One of my favorite funny authors, Carl Hiaasen, has written several children’s books (Hoot, Flush, Scat) that feature eco-themes where young eco-warriors thwart fat, evil businessmen who damage the environment. Trite, but effective.

Mark Levin in his runaway best seller “Liberty and Tyranny” explains the motivation of the modern environmental movement in clear concise terms. He calls them “enviro-statists”. BTW, everyone should read this book… even my liberal friends (maybe especially my liberal friends). He explains a great deal about where we are and how we got there.

While the “Green” movement has followed the trajectory of many other fads and been championed to the point of nausea, the radical environmentalist have clearly gained the upper hand in promoting their agenda. Obama has loaded his cabinet with true believers starting with “Energy Czar”, Carol Browner. She served as a Gore protégé and once worked for Ralph Nader. She was also one of 14 leaders of Socialist International’s Committee for Sustained World Society that calls for “global governance”. Ken Salazar at Interior is slowly but systematically shutting down any hope of drilling for more oil. Stephen Chu, Energy Secretary and Lisa Jackson at EPA are both global warming firm believers and are actively promoting the proposed Cap and Trade legislation and/or advocating the restrictions on carbon emissions through EPA mandates.

They are not much interested in this just in from the four agencies that track the Earth’s temperatures: Hadley Climate Research Unit in Britain, NASA Goddard Institute for Space Studies in NY, Christy Group at the U of Alabama and Remote Sensing Systems in CA. All four report that the Earth cooled in 2007 by 0.7C, the fastest drop on record. There has been no warming for the last 9 years. Last week Gore testified before Congress still claiming that the oceans will rise 20 feet and we are all doomed. Geeze, Al, get a grip. According to the latest poll, only about 30% of the US populace now believe that human activity has any impact on climate change.

Despite predictions from government and private sources that draconian restrictions on carbon emissions will result in huge increases in electricity and energy costs with concurrent job losses, the Administration persists in promoting their “renewable energy” (Solar and wind. Nuclear does not count even though it emits no CO2) program. Conservative estimates show that electricity prices will increase by 30% by 2020 and 101-120% by 2030. Job losses come in at 1.5 million by 2020.

Obama touts Germany as the poster child on how we should employ a renewable energy program. OK, let’s take a look.

Alex Alexiev in a NR article (“Green Bubbles Bursting”) points out that Germany achieved 15% of their electricity needs from renewables by offering that source seven times the wholesale price from conventional producers. Electricity prices went up 38% in one year. (2006-07) This, of course, does not include the infrastructure cost borne by the government. Part of the problem of renewables is the intermittent nature of the wind and sun. (News flash: the sun does not shine at night). These sources need to be backed up by conventional, usually gas fired, plants to provide energy to the grid.

There are other examples of European countries trying the green route but seeing the costs and irrationality, are now backing off. In Spain, another example cited by Obama, the Universidad Ray Juan Carlos calculates that for every “green job” created by their renewable program there were 2.5 jobs destroyed elsewhere in the economy.

There are also significant signs that Europeans have cast off their anti-nuclear hysteria and are planning on relying on nuclear energy for their future. Sweden has changed course, as has Italy that plans to get 25% of its future power from 8 new nuclear reactors. Great Britain will build 10 new reactors and even the Ukraine, site of the infamous Chernobyl disaster, plans 11 new reactors by 2030. Poland, Finland, Bulgaria and Romania are either planning or building new reactors. India plans to go from 3% to 45% nuclear with 40 new reactors, China plans a seven-fold increase and Japan wants to double from 30% nuclear.

Meanwhile, here in the USA nuclear is off the table while the agenda remains controlled by the hysterical environmental lobbies. Even as the Republicans timidly promote nuclear they know their suggestions fall on deaf ears. The primary tool of the environmentalists is litigation and the “citizen lawsuit provisions” of environmental law allow well-funded groups to bring lawsuits in the public’s name. They can and will hold up any project that does not fit their narrow theology.

A few Democrat Senators have been getting cold feet over the Cap and Trade legislation. As Duncan Currie points out in his NR piece, “Robbing Bismarck to Pay Boston”, many states get most of their electricity from coal fired plants, from a high of 97.8% in W. VA to 85% for many Midwestern states. Some states like CA get none or nearly none. These Senators realize that their states will be disproportionately impacted. Not good for re-election to vote for this turkey. The recent decision by the EPA declaring CO2 a hazard to health is meant to browbeat these reluctant Senators into line. Senator Boxer recently declared that if the Senate does not pass C & T, she would urge the EPA to act to regulate carbon.

Just what we need: economic and energy policy by fiat.

2 Comments

Filed under Cap and Trade, Czars, Earth Day, Environmentalism, Global Warming, Obama, Politics

April 18, 2009 · 7:39 am

Tea, Sir?

If you get all your news from the networks–ABC, NBC, CBS, otherwise known as the Main Stream Media, or MSM to those of us gamely holding the right flank–you might have missed that about one million pissed off citizens showed up at “tea parties” around the country on April 15th, tax day. You might have missed it because the MSM tried to pretend it wasn’t happening.

If a handful of Cindy Sheehan’s Code Pink fruitcakes set up somewhere for a peace protest or fifty lesbian bikers decided to ride down the streets of Fargo to promote gay marriage, the media would be all over it. Not this though. It didn’t fit with their liberal mindset and their mission to do no harm to the Obama Administration.

Although this was truly a grass roots movement inadvertently set off by an impromptu rant by CNBC’s Rick Santelli, and demonstrated coast to coast resistance to the policies being promoted by President Obama and the Democrat Congress, the MSM decided it was not news worthy. CNN and MSNBC, long since having given up any pretense of being anything but cheerleaders for Obama, ridiculed the event calling the participants “tea baggers”. This term, I later learned referred to a homosexual act. I hate to admit this since I have gone to college, been in the Navy and attended several county fairs, but I was unfamiliar with the term. Google to the rescue.

What cut ups Olbermann and the folks over at MSNBC are! And, thanks to them we have enlightened million of otherwise ignorant youngsters around the country on this important piece of gay trivia.

The Democrats, of course, poo-pooed the whole thing, calling it a Republican inspired non-event. Nancy Pelosi said it was not a grass roots movement but an “Astroturf” event. Amusingly, this term originated with David Axelrod, Obama’s campaign manager and advisor, who routinely ginned up non-movements to deflect and confuse his opposition. It reminds me of Hillary and her “politics of personal destruction” charge when she and her cohorts actually invented the practice. Pelosi went on to make herself look even more foolish by saying the people involved were all “rich people trying to get out of paying their taxes”.

These “tea parties” were not about simply taxes any more than the original Boston Tea Party was about the British Tea Tax. It reflected a real and growing concern that the policies of this Administration and Congress were leading the country in a dangerous, socialist direction with massive spending and intrusion in the economy. Democrats were quick to spout the campaign fallacy that 95% of Americans are getting a tax cut and, in any event, no one’s taxes had been increased. (Yet.) Everyone knows tax increases are coming, although the Dems hope that delaying them until after the 2010 elections will keep them in power.

I believe these protests also indicate a growing concern about Obama. Although he, like Clinton, schedules an event daily to keep him as the lead story on the evening news, there have been some disquieting indications that BHO may not be the messiah everyone hoped. A few examples:

· Bad mouthing the USA in Europe. (We are arrogant?)

· Bowing to the Saudi King.

· Sucking up to the Iranians.

· Firing the head of a public company (GM).

· Appointing a tax cheat as head of the IRS.

· Saying he supports the 2nd Amendment but quietly pushing for gun restrictions.

· Pushing a huge carbon tax to finance the takeover of the health care industry.

· Jetting around on Air Force One (he calls it his “cool ride”) and living the luxurious life. (Hauling his wife’s hair stylist and make up artist on AF-1 to Europe. Flying in a pizza chef from St. Louis. Flying to Chicago for Valentine’s Day. Lavish parties in the White House.) These are not great examples for the leader who moans about the financial circumstances of the electorate. (Let them eat cake?)

· Talking about nuclear disarmament while North Korea is firing rockets and re-starting their nuclear program and Iran keeps those centrifuges humming.

In a curious coincidence, while the tea parties were getting fired up, the “Washington Times” unearthed a confidential Department of Homeland Security document sent out to the FBI and law enforcement warning them to be on the lookout for “right wing extremists”. You might be surprised to learn that if you are an opponent of abortion, an advocate of state’s rights, a supporter of the 2nd Amendment, object to high taxes or are a returning military veteran, you are a potential threat to the security of the USA. The government thinks they better keep an eye on you just in case. That’s comforting.

This amazing pronouncement comes on the heels of the same DHS wizards proclaiming that henceforth the word terror will be banished. Terrorism will now be dubbed “man caused disasters” and the war on terror will now go by the newspeak term “overseas contingency operations”. I feel safer already knowing we won’t be offending any terrorists and keeping an eye on those dangerous pro lifers.

The big losers in this tea party protest business is the MSM who have further damaged the remaining shreds of their claim to credibility and the Democrat Party. Once again, and in explicit fashion, the leaders of Congress have demonstrated their distain for the American people. The question remains whether the voters will turn out in 2010 and throw a lot of these fools out of office.

Fox News covered the events extensively and I think are big winners here. It’s all the more reason for the Democrats to push hard to shut Fox and talk radio the Hell up.

Leave a Comment

Filed under Fox News, Obama, Politics, Tea Party

April 13, 2009 · 8:40 pm

‘Til Death Do Us Part

The other day while spending some time in the “contemplation room”… the place with all the porcelain equipment… I got to wondering how many years the leaders of Congress have served. This is the kind of stuff that bubbles to the surface of my brain when suitable reading material is not near at hand.

We know the current President is a little short in the experience department, but what about the Congressional leaders? And perhaps more importantly, what sort of experience outside of politics do they have?

Once again I tip my soggy cap to the Internet. I set my chubby fingers to work on Google and came up with some interesting statistics. I picked 20 well known leaders in Congress who are committee chairmen or simply well known. They are:

Joe Biden (Of course, he’s now VP and no longer in the Senate but hey, it’s my list.)
Robert Byrd
Ted Kennedy
John Dingell
Henry Waxman
Nancy Pelosi
Harry Reid

David Obey
Pete Stark
Pat Leahy
Chris Dodd
Ed Markey
Carl Levin
Richard Durbin
Steny Hoyer (Unknown but, Majority Leader)
Chuck Schumer
Daniel Inouye

Yeah, I know. These are all Democrats. But, they are in charge now. I’m confident many politicians on the other side of the aisle have similar backgrounds except, of course, all on my list are liberals.

The average amount of time served in federal office for the above list is 36.5 years. This does not include time served in elected office in their state legislatures. Robert Byrd, for example, has served 50 years in the Senate, seven years in the House and before that, 13 years in the West Virginia Senate. Harry Reid, the current Majority Leader only served 27 years in the House and Senate, but logged 15 years before that in the Nevada House. Hoyer only has 28 years in the House but did 15 years in the MD Senate first. John Dingell, the longest serving member of the House, has been re-elected every two years since 1955, two years after he graduated from Georgetown Law School.

These folks have spent virtually their entire working lives in the surreal world of Washington politics having their egos and bank accounts burnished and far removed from the day-to-day struggles of the average taxpayer. Chuck Schumer, who has 28 years in Congress and 6 in NY state government, never worked a single day outside of elected office. Only one (Pete Stark) has any business experience and only a few ever worked at a job in private enterprise at all except as lawyers. Of the 20 on my list all but two are lawyers. If you’ve ever wondered why Congress cannot bring itself to stop the runaway tort problem in the US, there’s your answer. They are all lawyers themselves.

The primary job of Congress is to spend money to run the government and to levy taxes to pay for it. Of course, over the years these professional politicians have come to believe that they can dictate nearly every aspect of our lives. From telling us how to educate our children to what labels must be on cereal boxes, from forbidding us to pray in schools to how fast we can drive, from how far a car must go on a gallon of gas to who can own a firearm, the politicians want to manage everyone’s life. And, with the above group in control, they want even more power. They want to tell corporations how much money they can pay their executives, what kind of toilets and light bulbs we have to use and how much carbon dioxide we can exhale. They want to take over and run major industries like banks and auto companies.

The question in my mind is: are these guys that smart? OK, nearly all graduated from law school so they must be smart. Well, Joe Biden actually graduated from law school so maybe that’s not a good test. Anyway, smart is not enough in my mind. How about a little practical experience?

Let’s face it, their primary objective in life has always been to get re-elected and they’re obviously pretty good at that. About 95% of them get sent back for another kick at the can every election cycle. Over the years they’ve re-giggered the Congressional electoral districts to create “safe” districts through gerrymandering to insure that either a Democrat or Republican automatically gets in. And, let’s not forget their control of the purse strings garners them substantial contributions for their campaigns. Think earmarks.

The current crop of Democrats in control wants to take it a step further. They already have the union, environmental and black vote locked up, but now they want to get as many people as possible on the government payroll and dole. They would also like to give amnesty to 12 million illegal immigrants who will likely vote for Democrats too. If they succeed you can pretty much bet the farm that they will be in control for generations to come. If you like the way Germany and France operate you might be happy with that development. On the other hand, you might want consider that the power of the US military backed by its industrial and technological vibrancy has been defending the socialist democracies of Europe against tyranny since WWI. Who’s going to do it when the US can’t?

And don’t kid yourselves; with all their social commitments, increases in government and anti-business policies, the US won’t be able to afford to be the protector of freedom for much longer.

2 Comments

Filed under Congress, Politics

March 31, 2009 · 6:15 am

Going Postal

In 1965-66 while bobbing around the North Atlantic and Mediterranean aboard the USS Casa Grande, LSD-13, mail service was, as you would expect, a little slow. Four decades later things have not improved, even without the handicap of being in the middle of some ocean. Turning a first class letter over to the gentle ministrations of both the USPS and Canada Post is a bit like tossing the letter in the ocean and hoping the tides will eventually get it to its destination. It can take ten days to get a letter from Seattle to Whistler, about the same amount of time you would require to walk it up there yourself. You can imagine what kind of problems this creates when you are trying to pay a bill to a US company.

Postage rates go up every year while the service gets worse. In 1975 the cost of a first class stamp was $.10. By 1981 it had doubled to $.20 and then between 1985 and 2008 had doubled again to $.44. Despite these increases and the USPS monopoly position, this government owned corporation manages to lose money nearly every year and require a government “bailout”. This year the USPS expects to lose $2.9 billion and anticipates even bigger losses next year. They are proposing cutting delivery to five days to save money.

The USPS is the 8th largest corporate entity in the US with over 900,000 employees. Make that government union employees, meaning no Democrat in his right mind would ever vote to privatize this turkey. And, despite running this hopelessly inefficient and money losing operation, the USPS awarded its executives $197 million in bonuses last year. After demonizing every bank and corporate executive in recent weeks about pay and bonuses you’d think someone in the media might have brought this up. Not likely. And, I doubt the class warrior foot soldiers at ACORN will be sending any busloads of protesters out to the homes of USPS execs to chant and wave signs or threaten them with hanging.

The problem with the USPS is the same as with any monopoly: the lack of competition and the absence of any real motive for profit or efficiency. Even where the USPS competes with private companies like UPS or FedX they get their asses kicked and that’s even with the various restrictions the USPS places on them. You can read more at:
http://www.blogger.com/www.i2i.org/articles/4-2001.PDF.

The whole post office thing bubbled to the surface of the fevered swamp of my brain as I listened to President Obama explain today how the government was going to take over and fix the auto industry. In other words, turn it into another post office. You may have noticed that the stock market responded to this news by dropping 254 points today.

The first step in this program was the firing of GM CEO Rick Wagoner. Does GM have a Board of Directors? Of course. But, the nameless wizards appointed by Obama to “oversee” the automobile business have decided that ol’ Rick must go or the administration will shut off the bail out money. If the board had a lick of sense or courage they should have said, “Screw you” and immediately filed for Chapter 11.

Silly me. I thought we had settled this debate about free enterprise and government micromanaged economies long ago.

Have we forgotten about the collapse of the former USSR? Or, the perfect comparison of the success of West Germany over East Germany? Or North Korea vs. South Korea? So, with these real world examples fresh in our mind we now think that the Obama Team with the combined business experience of the average high school senior can effectively run the auto industry? Absurd.

I have suggested in previous posts that I believe that the unions and various government mandates imposed on the auto companies (CAFÉ mileage standards) have contributed significantly to the difficulties at the Big Three. Can you imagine what the politicians will do to these firms when they have complete license to meddle in the day-to-day business decisions? You should be able to easily picture these anti-business, environmentally besotted types demanding that the auto boys produce cars that meet the “green” standards but that no one wants to buy. Do you believe that the Democrats who have the unions in their pockets are going to play hardball with them? Get real. Like the post office, the auto companies will need a bailout every year.

Obama had all the CEOs of the nation’s largest banks over to the White House for lunch this past week. I’ll bet they got a spanking from BHO and left with a silent vow to send the TARP money back as soon as humanly possible. That is, if they can. Mr. Geitner plans to subject them to a “stress test” that may require them to take more TARP funds whether they want it or not, keeping them under the thumb of the politicians and bureaucrats.

The Obama team is moving swiftly to take over as much of private industry as possible before the honeymoon ends: First the auto companies, then the banks, health insurers and perhaps the oil companies. When all major American industries are run by the government and managed with the cheerful efficiency of the US Postal Service the “Change We Can Believe In” will have truly arrived. Welcome to East Berlin.

1 Comment

Filed under Obama, Politics, USPS

March 21, 2009 · 4:08 am

Fred’s Tossin’ and Turnin’

Next month marks the 65th anniversary of the publishing of Friedrich Hayek’s classic The Road to Serfdom. He wrote it as World War II drew to a close to warn Europeans of the dangers of socialism. At the time, the leading intellectuals in England and elsewhere strongly favored pushing their societies toward the warm fuzzy embrace of socialist utopia. Hayek pointed out that for socialism to function, the government must become more and more coercive. (Think of the IRS and the heavy fines meted out by government agencies to bring citizens to heel.)

Eventually, Hayek observed, this power over the individual falls into the hands of a despot with disastrous results. His prime example of this phenomenon was Germany. They had embraced the National Socialist Party, granting it absolute control over German society. When Hitler took over, the NSP morphed into the Nazi Party and Germany became a military dictatorship. (“Nazi” by the way, is Bavarian slang, which roughly translates into “dummy” or “dunce”.)

Hayek rightly made no distinction between the terms “fascist” or “communist” as is so common today in intellectual discourse from the left and right. For the average citizen the realities of living under either one is identical with the loss of individual freedoms such as speech, assembly, property and the likelihood of getting a fair trial when you piss off some bureaucrat.

It would be hard to deny that the current Obama Administration and Democrat controlled Congress is pushing us rapidly into the direction of socialism. Indeed, “Newsweek” magazine on its Feb. 26th cover proudly proclaimed “We’re All Socialists Now”. They accept that the era of bigger government is coming and that we should embrace it. Ol’ Friedrich is turning in his grave.

Hayek was an economist first and often did intellectual warfare with John M. Keynes during the Great Depression. Keynes believed in an activist and expansive government and favored fiscal stimulus (big government spending). Hayek believed in free markets, limited government, stable monetary policy, low taxes and appropriate regulation. (Ebenstein, National Review, 2/23/09). The politicians of the day followed Keynes’ prescriptions and the depression lasted from 1929 until after WWII. In short, it did not work out well.

Hayek was a “monetarist” meaning he favored actions by the Federal Reserve to create stability in the money supply and interest rates to direct the economy independent of political influence. “Fiscal policy” is the responsibility of Congress.

In past blogs I have asserted that the current mess precipitated by the housing bubble was caused by “easy money” for far too long and the interference by Congress in the housing market with the Community Reinvestment Act. To understand how this worked out let’s look at what the Fed under Greenspan (Fed. Chairman ’87-2006) did and see the results on the economy of his ministrations.

Between 1998 and 2000 Greenspan gradually ratcheted up interest rates to 6.5% causing a recession in 2001. (Note: This is the Federal Funds Rate as opposed to the Prime Rate, which is generally 3% higher.) He began lowering rates until they hit 4% just before 9/11. Immediately after 9/11 he dropped them to 1% and kept them there until 2004. Hayek argued that, “…if interest rates are too low they will attract resources to areas of the economy not otherwise attractive to investment.” Like real estate? Housing prices were skyrocketing and the mania was in high gear. Sensing trouble, Greenspan then jacked up rates to 5.25% by 2006. Adjustable rate mortgages started kicking in and that pinprick caused the bubble to burst. Many economists now call this whole mess “The Greenspan Bubble”.

From this it should be clear that the Democrat strategy to blame the economic crisis on Bush, while effective, is totally bogus. The politically independent Fed gets the lion’s share of the blame for this debacle, with honorable mention to House Democrats who pushed to get unqualified buyers into houses and then resisted all efforts to rein in Fanny and Freddie.

The 2006 elections brought in a Democrat controlled Congress and the 2008 Presidential election gave us the thinly qualified Obama. Rewriting history and elevating FDR to sainthood have resurrected Keynesian theory.

Money in incomprehensible numbers is getting tossed out the door in frantic spending to try to stem the tide of recession. At the same time the Fed cut the interest rates to essentially zero. And, yesterday while House Democrats were looking for the addresses of the AIG employees who got bonuses so they could string them up on the nearest light pole, the Fed quietly created $1.5 trillion dollars out of thin air. They’re gonna print it, folks! Did I hear someone say “smoke screen”?

In the most blatant display of hypocrisy I’ve ever witnessed, politicians called for the heads of AIG executives for receiving bonuses that were agreed to in the very “stimulus” legislation they had just passed!! Of course, they had an excuse: none of them had actually read the damn thing. Latest news on this is that Geitner, Obama’s Treasury Secretary, now admits that he insisted the “Dodd Amendment” authorizing the bonuses be added to the stimulus bill. Dodd had only the day before denied he knew anything about the amendment carrying his name. Today they passed a bill to tax these 71 individuals to get the bonuses back. It’s probably unconstitutional. How can anyone have any confidence in these clowns?

But, I digress. Feel better though having gotten that out of my system.

OK, what does all this mean? It seems the latest move by the Fed coupled with the massive spending by the Obama Team will likely jolt the economy into a mild recovery. Most likely we will dip back into recession when the cap and trade taxes, individual tax hikes and card check kick in. In any case, almost everyone expects that the next ice burg in our path will be unprecedented inflation. In a year or two the US dollar might look a lot like the Zimbabwe currency.

Fred, climb out of the grave. We need ya, man.

1 Comment

Filed under Economy, Keynesian theory, Obama, Politics

March 8, 2009 · 8:12 pm

Let’s Have the Debate

Journalist Peter Foster reports in the “National Post” today that he is heading off to New York City to attend the 2009 International Conference on Climate Change. Dubbed the largest ever gathering of climate change skeptics, the title of the event is: “Global Warming: Was it Ever Really a Crisis?” Dozens of presenters from the scientific community will offer papers disputing the conventional wisdom that global warming exists and that, in any event, is not a threat to humanity. Presumably, (and hopefully) they will discuss the economic folly of promoting drastic measures in the midst of a worldwide recession.

I suspect that this conference will not get even a passing reference in the mainstream media. That would prove embarrassing to the media and Obama Administration as they push forward with their plans to impose a $650 billion cap and trade regime (carbon tax) on the American people. Even Obama and his fellow socialists admit that energy costs will skyrocket, while they are less forthright in admitting that this war on CO2 amounts to a huge tax increase on everyone. No one in support of this scheme wants to confess that poorer citizens will be hardest hit. That famous 13 bucks a week in tax breaks (falling to $7.10 in 2010) for lower income Americans will quickly evaporate as the cost of everything goes up…. except the stock market, of course. That will be going down and so will the job market as industries flee the country. You really have to wonder if these guys have a clue. Or maybe, (and God I hate to say this) it’s intentional. Can it be possible that they hate business so much that they would intentionally destroy the American economy? When ideology trumps reason and science you have to wonder.

Meanwhile, on the other side of the pond in Merry Old England where they are still seething over the dissing of PM Gordon Brown by the White House, another conference is taking place. This one at the University of the West of England in Bristol brings together psychologists, sociologists and eco-gurus and will explore the Mental Disorder of “climate change denial”.
Yes indeed, the 650 certified meteorologists and climate scientists on the US Senate compilation of climate cataclysm skeptics and the 32,000 scientists who signed the Oregon Petition saying they dispute that humans are causing climate change are certifiably nuts. Hold on while I see if I can find a straight jacket on eBay.

Foster dubs this group climate true believers adherents of a “global state religion” or “eco-shariah” and anyone disagreeing with accepted dogma in need of serious psychological treatment. Like the medieval Christianity, Islamic fundamentalists or communist dissenters, non-believers need to be tortured (re-educated?) until they accept the true faith. Perhaps a little electro-shock therapy would do the trick?

This sort of thinking lends a lot of credence to the late Michael Crichton’s contention that modern society has embraced environmentalism as a secular religion. Only a true believer refuses to look at scientific evidence with an open mind.

One thing remains clear, no one in the Obama Administration wants to have a debate about the validity of global warming. (Al Gore doesn’t want to debate anyone on the science either.) And, they certainly don’t want to have a vote on this massive tax increase. They can avoid that messy confrontation by simply imposing cap and trade through the regulatory auspices of the EPA and/or regulations under the ESP (Endangered Species Act. Remember those “endangered” polar bears?) Having a debate would expose millions of people to the scientific evidence and raise the question of whether this is about saving the planet or simply a massive tax and power grab.

Can you say taxation without representation?

Leave a Comment

Filed under Global Warming, Obama, Politics, Tea Party

February 18, 2009 · 4:21 am

Prognostications

Despite my busy schedule of swimming, golfing and soaking up the sun here in Hawaii, I have been keeping abreast of developments back on the “mainland”. (We’ve got TV and the WSJ here. Internet too.) While it has been amusing watching the Obama Administration floundering with their tax dodging appointees, the serious business of the economy and the fate of the “stimulus package” keep the laughter in check.

Obama and the Democrat Congress have been moving quickly on several fronts and I have noted that they are working their way down my list of predictions of what they would do once they had control of the levers of government. One of my three faithful readers once said we would have to wait to see the accuracy of my predictions. So, I thought it might be useful to go back through my blogs and make a comprehensive list so you could keep score at home. Maybe print out a copy and put it on the fridge? Run a yellow hi-lite through the correct ones and red through the misses? Just a thought.

In a piece called “Elections 2006” written prior to the ’06 Congressional elections, I predicted that the Democrats would takeover Congress but, that Bush vetoes would slow their worst instincts. Careful readers will note that this piece is not on the blog. Hey, I don’t show you everything. I sent it to a selected list of friends. So too with a 11/12/06 piece called “Now What?” In that piece I predicted the following:

· The election of a Democrat as President.
· The election of a veto proof Democrat Senate.**
· A recession.
· Closing down of Guantanamo and release terrorists.
· Restrictions on intelligence gathering with possible disastrous consequences.
· The raising of taxes.

Looking pretty good on the above ’06 predictions. (**With the three RINO Republicans, it looks like they have it.)

In case you missed it, Obama has ordered Gitmo closed and already dismissed charges against the mastermind of the USS Cole bombing (Ali A Kaboom?). While everyone was looking the other way Congress also reversed the estate tax reduction and increased tobacco taxes. But hey, BHO and the Dems have only been in power for less than a month. They’re just getting warmed up. Like I said, I did not post those predictions but if you want the pieces, send me a polite email.

In blogs I did post I made the following predictions:

· The Democrats would enact the “Card Check” legislation making it easier for unions to organize. · Pass the “Fairness Doctrine” to stifle conservative talk radio.
· Return the restrictions on drilling for oil and natural gas on public lands and offshore.
· Give more money to the auto manufacturers.
· Not allow the construction of nuclear power plants.
· Enact Cap and Trade carbon emission limits through the EPA, which will cripple coal-fired electric generating plants.
· Toss huge amounts of money at solar and wind power.
· Abandon missile defense and reduce our nuclear arsenal. (or upgrade it).
· Enact restrictions on private gun ownership.
· Appoint “living constitution” proponents to the Supreme Court.
· Squelch school choice.
· Abandon any efforts to enact tort reform.
· Attempt to make illegal aliens citizens.
· Put the government in charge of health care.

In less than a month BHO and his comrades Nancy and Harry have made an impressive start on that list. New Sec of the Interior, Ken Salazar has already cancelled 77 drilling leases in Utah (Bob Redford is thrilled) and is now “reviewing” the opening of drilling off the coasts. Right.
One thing I did not anticipate… that the White House would be audacious enough to take over the US census. With that power play they get to fiddle with the numbers that determine Congressional districts and distribution of money to various groups.

Of course, the biggie is the so-called “stimulus” package that passed Congress on Friday. This massive spending bill was enacted before anyone could actually read it. At 1078 pages it would take more than a few hours, so no one knows for sure what’s in it. The scant details revealed so far indicate that the Democrats loaded it up with massive cash to their favorite constituent groups. My personal favorite is the $8 billion for a high-speed rail connection between LA and Las Vegas. In case you’ve forgotten, Nancy Pelosi is from CA and Harry Reid is from Nevada. As Craig Ferguson would say, “Coincidence?” Sure. The $4 billion to community groups like ACORN comes in a close second.

As I predicted, this stimulus will not work. Recessions usually last 18 months and despite Obama’s characterization of this one as the worst since (and maybe worse than) the Great Depression, the economy was actually in more trouble when Reagan took over from the hapless Jimmy Carter. Unemployment was 10.8% in 1982 and is 7.6% at latest count. It was 25.2% in 1932. GDP actually grew in 2008 and the Congressional Budget Office predicts a drop of 2% in 2009. That’s about the same as 1982 and a far cry from the 30% drop in the period 1930-32. But, BHO and the Dems needed a major crisis to ram this hard port tack into socialism down everyone’s throat. And, with popular support fading, they had to quickly pass the thing late on a Friday before anyone had a chance to see exactly what’s in it.

Obama and the Democrat leaders in over-hyping this economic “crisis” are actually making it worse. One of our biggest problems right now is fear and a lack of confidence. Running around the country on Air Force One telling everyone the sky is falling is not going to encourage anyone to purchase a new Chevy or invest in a share of stock. Reagan solved the recession of the early ‘80s by cutting taxes and exuding confidence and optimism.

Keynesian spending has not worked in the past and, from what we know of this package so far, will have little impact on the demand side that the proponents hope. Also, it remains to be revealed how much protectionist language is included in the bill. Historians note that FDR’s massive spending and the protectionist measures of that era prolonged and deepened the depression of the 30s. But, just because it didn’t work before does not mean that liberals won’t try the same thing again. For the Left ideology always trumps fact and previous experience.
Few are giving much consideration at this juncture on the inflationary impact of this legislation or the tax implications on future generations that will have to pay for it. The voters will eventually figure all this out. Look for big gains by the Republicans in the 2010 Congressional elections and the end of the Obama love affair in 2012.

Leave a Comment

Filed under Keynesian theory, Obama, Politics, Predictions, Stimulus

January 27, 2009 · 2:20 am

Change I Can Believe In

With the economy tottering the new Obama Administration is pushing for another “stimulus package” of some $850 billion to perhaps one trillion. This on top of the one trillion already tossed out the door at various struggling entities such as banks, insurance companies and auto manufacturers. Together these two incomprehensible amounts of money will increase the national debt by a whopping 20%.

The bad news is that this reprise of Keynesian Theory will work no better than it did during the Great Depression when FDR was throwing money around or in the ‘90s when Japan tried the same thing. All together now…. “Here we go again.”

The latest news on the results of the TARP (Troubled Asset Relief Program) has just come in. This was the grand scheme for the government to ship off $148 billion to the top banks in the faint hope that they would start lending again. The bad news: Bank lending went down some $48 billion since they got the money. None of the money from TARP got loaned out and the banks made even fewer loans with their own cash. Why? Because their balance sheets are a mess, that’s why. They have a pile of assets that are worth essentially zero because of the “mark to market” accounting rules enacted after the Enron fiasco. The Congress could help the banks shore up their balance sheets at no cost to the treasury by simply reversing this rule. It was political overkill anyway and under the present circumstances, a big hindrance.

The Obama team has proposed massive amounts of infrastructure spending with the hope of jump-starting the economy. They’re talking about highways, fixing up schools, tossing cash at solar and wind power programs and building new transmission lines to carry all this new electricity. One of the big problems with this kind of thing is that a lot of time elapses between the decision to build something and when someone actually turns a shovelful of dirt on the project. Most of money allocated for this kind of stuff won’t help the economy for a year or more.

If the Obama team insists on massive infrastructure spending, the least they can do is suspend Davis-Bacon. This act, passed in 1931, requires that “locally prevailing wages” be paid on all federally-funded projects. The phrase is shorthand for construction union wages. Because of this requirement and the red tape involved in federally funded projects, many companies refuse to bid on them, raising the cost of these projects as much as 40%. Suspension of Davis-Bacon during emergencies has been done many times before. Nixon, Bush I and Bush II have done it, the latter during Katrina. Even FDR did it. While it makes perfect sense now, I doubt Obama will take this sensible step. He owes the unions too much for their help in getting him elected.

As I’m sure you already guessed, I have a few additional suggestions. As already discussed above, they could reverse the Mark to Market accounting rules. It’s a freebie. Only problem: Politicians hate to admit they made a mistake. I suspect this is why they have not already taken this simple step.

A few weeks back a Texas Congressman made a suggestion to put money quickly in the hands of Americans so they could start spending again. (I forget the guy’s name. I could probably look it up but hey, I am in Hawaii and there are other things to do) [Editor’s note: Louie Gohmert (R-TX)]. Elegant in its simplicity, the Congressman’s idea was: If you are going to spend $350 billion in stimulus why not just stop deducting taxes from everyone’s paycheck for three months? For one thing, doing it this way avoids the inefficiency of having the government dole out the money. Anytime you run money through a bureaucracy you are assured of losing a pile of it with inefficiency. Remember the last stimulus package? Writing and mailing out a $600 check to everyone had to cost a ton. (I never got one, by the way. Big Brother, are you listening?)

The Bush Administration doled out some $13 billion to the auto companies out of the TARP funds. They will certainly be back hat in hand looking for more cash in the months to come. I would tell them “NO”, and then “HELL NO!” if they misunderstood. They should be allowed to go bankrupt. Hey, Chapter 11 is not the end of the world. They need to restructure, to renegotiate their labor and distribution contracts and to develop a business model that makes sense.

To balance this tough love Congress should give them some breaks on the CAFÉ standards by allowing them include their whole fleet in their calculations and by not imposing even tougher mileage standards in the near term. They could offset any perceived loss of fuel efficiency by allowing the importation of autos made by the Big Three in their overseas plants… especially small diesel cars. The chances of this happening?

None. The UAW will never allow the Democrats to do it.

Obama and his Democrat controlled Congress could do much to ease the minds of investors and business owners by voting to make the Bush tax cuts permanent. The fear and uncertainty of tax hikes continues to put a damper on the stock market and anyone thinking about starting a business right now has to be skeptical. Again, the chances of this happening are remote at best. Despite ample evidence to the contrary, the Left doggedly sticks to the myth that the Bush cuts were a sop to the “rich”. (One of my earlier posts has some specific numbers.)

Finally, I think it worthwhile to devote some thought to the revenue side of the equation. Eventually, someone will have to pay for all this massive government spending. The only idea that bubbles to the surface of a left wing brain involves raising taxes. Little credit is given to the drag that excessive taxation places on an economy or the degree to which it prevents a country from growing its way out of debt. (Think France and the other socialist economies of recent history.)

Besides taxation there is another way to raise revenue and many countries have become quite wealthy in this fashion. The Middle Eastern countries, Venezuela and Russia have exploited their oil resources to good advantage. Canada too. The US has plenty of oil. It also has 250,000,000 automobiles on the highway according to the DOT (2006). The US could raise billions of dollars in royalties, not to mention improving its balance of payments, drilling for oil and natural gas in currently restricted areas. I’ve read that many wells could be brought into production swiftly by utilizing existing offshore platforms and the new drilling techniques. As an added benefit, new supplies from domestic sources would help retard price increases when demand returns.

There are those on the conservative side who believe that Obama and the liberal Democrats want to use this economic crisis to move the US further toward socialism, just as FDR did during the Great Depression. They opine that moving more middle class folks off the tax roles and into receiving checks from the government will make them Democrat voters. Perhaps.

One thing is clear, unless they make intelligent, common sense decisions to let the American economy absorb the asset bubble and encourage the private sector to grow, this mess will persist.

A long recession (depression/stagflation) will impact everyone, regardless of your position on the economic ladder.

1 Comment

Filed under Keynesian theory, Obama, Politics, Stimulus, TARP

December 8, 2008 · 7:44 am

Stupid is as Stupid Does

The great American philosopher, Forest Gump uttered those memorable words. He also said, “Life is like a box of chocolates, you never know what you will get.” I can’t help but think of these two gems when I ponder what the new Obama Administration and the new solidly Democrat Congress will do in the coming year.

From the appointments we’ve seen so far it seems the “Change We Can Believe In” amounts to rehiring all the guys from the Clinton team. If memory serves Clinton was quite radical in his first two years… until the alarmed electorate voted in a Republican Congress in 1996. Clinton then got religion and governed more like the centrist he claimed to be.

Observers have tried to be optimistic that BHO, Pelosi and Reid would show some restraint with the economy in a shambles, but recent comments from the anointed ones do not inspire confidence. On the economic front it looks like the only idea anyone has is to throw more and more money at the problem. Damn the torpedoes of inflation or the ice burgs of government ownership of major industries. Don’t worry about the distant shoals of debt. Open the valves of spending. Full speed ahead!

Once the new Congress gets sworn in and get their furniture rearranged we should expect quick action on two Democrat pet projects: the Employee Free Choice Act and the Fairness Doctrine. These two turkeys could only have been named by Orwell’s Ministry of Truth for there is no “free choice” in the former or “fairness” in the latter.

The EFC Act is a sop to the unions who love the Democrats unconditionally and give them millions. Better known as the Card Check bill it makes it substantially easier to organize a union shop. Less than 10% of the US workforce is currently unionized, mostly government employees and workers in major industries. Union shops like automobile manufacturers and airlines have been falling like flies lately and entrenched unions rightly deserve a lot of the blame. Government unions produce no measurable product and even if they do (like the teachers unions) and the product is crap, they persist. This does not suggest greater unionization is a wonderful idea in this time of economic trouble.

The Fairness Doctrine is only designed to put conservative talk radio out of business. The left already controls the mainstream media…. TV, Hollywood and the major newspapers. This violation of the 1st Amendment would silence any dissent of the left wing agenda.

While some of Obama’s economic team may have convinced him that raising taxes during a recession is a formula for financial disaster, he seems determined to push ahead with his fight against global warming with his Cap and Trade program. He said recently, “[we] will establish strong annual targets that set us on a course to reduce emissions to their 1990 levels by 2020 and reduce them an additional 80% by 2050.” Remember, Obama promised during the campaign to bankrupt anyone who attempted to build a coal fired power plant.

VP candidate Biden in one of his memorable gaffs said, “We’re not supporting clean coal” and “…no coal plants here in America.” Harry Reid, Senate Majority Leader and dipshit buffoon, once said, “That is, coal makes us sick, oil makes us sick; it’s global warming. It’s ruining our country; it’s ruining our World. We’ve got to stop using fossil fuel.” Harry and BHO probably never bothered to check, but the US gets 85% of its energy needs from fossil fuels and 50% of the US electrical power is supplied by coal plants. Do they really believe that they can replace fossil fuel with solar and wind power? Does anyone believe that the radical environmentalists will ever allow the Democrats to build a single nuclear plant? Their only hope of replacing coal is nuclear and they can’t go there.

The significant phrase in Obama’s quote above is “strong annual targets”. That suggests to me that he plans to use the EPA to regulate greenhouse gas emissions and implement his Cap and Trade dreams through that behemoth. The EPA has already prepared an 18,000-page Advanced Notice of Proposed Rulemaking (ANPR) document regulating every emitting source from coal plants to lawn mowers. It amounts to a tax on energy, will cost trillions and wipe out jobs by the millions. Estimates from the Heritage Foundation suggest net job losses (that’s after you add in the “green” jobs created) at 500,000 per year and a cost of $5000 per household. American companies will be leaving the country in droves.

While this madness continues to rumble down the tracks we get this update on global warming from the US National Climatic Data Center. Seems the global temperature went DOWN in 2008 with some parts of the world seeing snow for the first time in memory. 2008 saw record snowfalls in China and Canada (Toronto’s Feb. snowfall the most since 1950). Sea ice build up in Antarctica was the largest in 30 years and even the much-discussed Artic saw increases of 10 to 20cm of ice. Nothing in yet from the polar bears.

[Editor’s note: In April 2007, the news release about the dire situation of the Polar Bear was exposed by an Australian journalist as a hoax. The photo was not taken by Canadian environmentalists, but taken by a marine biology student more than two years before in the month of August–when ice caps are naturally melting–and the bear was within easy swimming distance of larger chunks of land; it was released by the AP along with the introduction of the UN’s Global Warming Report.]

[Also, there are more reports from a group of international scientists on the global warming nonsense.]

According to Kenneth Tapping of the Canadian National Research Council, solar activity is way down. “The last time the sun was this inactive, Earth suffered the Little Ice Age that lasted five centuries and ended in 1850.” Gee, maybe the sun has something to do with global warming? OK, one winter does not an ice age make. But, it should give everyone a reason to look a little more critically at the absurd contortions of the global warming fanatics. More importantly, it should give our politicians pause before imposing an economy destroying policy on North America. You’d think, but I’m not betting on it.

Don’t count on the Democrats allowing any more drilling for oil or gas either. That’s way too logical.

1 Comment

Filed under Cap and Trade, Clinton, Fairness Doctrine, Global Warming, Politics

November 20, 2008 · 6:46 am

Where’s the Bottom?

Another very bad day on Wall Street… the Dow down 427 points, closing below 8000. More bad news out of the banking industry, the Big Three execs in Washington begging for cash to stay alive and Paulson zigging and zagging over what to do with his $700 billion. Not the kind of news to send folks out to the auto mall to purchase a new set of wheels or give the broker a call to pick up a stock or two. Everyone is waiting for the next shoe to drop. Actually it reminds me of that recent TV ad where it’s raining shoes. (Funny. I can’t recall what they are selling.)
Frankly, I think Paulson would like to punt the whole $700 billion TARP thing down the road to the next administration and let Obama’s new Treasury Secretary figure it out. That way he could sneak out of town and not take the blame when it doesn’t work. The whole thing smells like they have no clue.
The Big Three automakers were operating on a flimsy business model before they got whacked by the duel tsunamis of the spike in gas prices to over $4.00 per gallon and then the credit meltdown. Decades of increasing concessions to the UAW and the accumulated deadwood of their own management and distribution network (they have way too many dealers) placed them at a big disadvantage to the foreign manufacturers. They have huge liabilities for their retirement and health care programs and they must pay nearly full wages to tens of thousands of laid off workers. The sum of all this means that their cost of producing a car is some $1600 to $2000 more per car than their Japanese competitors. Their loaded cost per worker hour is $72 vs. $42 for Toyota. Some business model.
In addition, Congress has placed some formidable obstacles in the way. As pointed out in an excellent piece in the Wall Street Journal today, Congress imposed the CAFÉ fleet-mileage standards that forced the Big Three to produce low mileage cars at a loss to sell their profitable and popular SUVs. Bowing to the green lobby, Congress will not allow the automakers to include in their CAFÉ calculations the autos they make abroad. This simple change alone, says the WSJ, would likely save Chrysler from bankruptcy. Nor will the greenies consider allowing the car companies to sell in the US their highly efficient, small diesel cars so common in Europe. Anyone who has rented a car in Europe has likely driven one of these little beauties. Quiet, peppy and non-polluting, they get great mileage. The environmentalists won’t permit the increase in the supply of diesel either. That’s why it costs more than gasoline. Never used to, and now it’s killing the trucking industry.
So, with all this against the auto industry does it seem like a great idea to throw $25 billion more at them? I think not. It’s only the beginning. Unless the Big Three can restructure their labor and distribution costs they are never going to be viable. And, unless Congress acquires some common sense about the penalties they impose with their mileage standards, even restructuring may not do the job.
Unfortunately, it looks like the incoming Obama Administration may make it worse. Bush refused to grant California a waver to impose a 23% reduction on greenhouse gas emissions from autos by 2012 and a 30% reduction by 2030.
That would have required the automakers to produce special cars for the California market. A killer. Obama promises to reverse the Bush policy. If he’s going to do that, sending the auto guys any amount of money is pissing it down a rat hole.
I believe, however, that Detroit will get the money, if only because the politicians are afraid to let them fail. Besides, the Democrats owe Michigan and Ohio. Bush will go along because he won’t want the demise of the US auto industry to happen on his watch. He’ll think, “Let the Democrats deal with it after January 20th.” Thus, the problem will be postponed and until the auto industry gets sorted out and banking stabilized, guessing where the bottom is can only be a WAG (Wild Assed Guess).

Leave a Comment

Filed under Auto Industry, Economy, Obama, Politics, TARP