.
According to the morning news, General Motors CEO Rick Wagoner has been asked to resign by Obama and his administration as a condition of accepting more of your tax money to "rescue" the automobile maker.
I for one would not argue that Wagoner has managed GM so well he should stay. Nor would I argue against the idea that he should have long ago been dismissed from his position with GM.
But isn't that the job of the company's directors? For that matter, why doesn't Obama fire the board of directors as well. After all, they have oversight responsibility of the actions of the CEO.
For that matter, isn't the resignation of a CEO the expected outcome of a bankruptcy reorganization? Could we not have saved a great deal of taxpayer money by simply letting GM endure the usual course of free market action -- a bankruptcy?
If any readers thought for one minute we have not de facto nationalized the auto industry, the fact that the president can, by whim or design, terminate the employment of the CEO of an ostensibly private corporation should change your mind. The action further has to lead us to the conclusion that every banking and insurance CEO now serves at the pleasure of the president of the United States rather than for the benefit of the shareholder.
While we desperately need regulations and oversight to ensure that boards of directors really act in the best interest of the holder of common shares, instead we get a powerplay to nationalize heavy industry.
Oh, this doesn't affect you? If you participate in a union pension plan it probably does. If you own a 401K with a broad stock mutual fund, it likely does. Basically, the chances are high that this action affects you both in your retirement prospects and in future much higher taxes to pay for this nationalization.
In fact, this action casts the specter of government interference and control of any business which employs you, if not now then sometime in the future. Consequently, we need to conclude that we are now a socialist nation if not by law, then by the fact of the actions we so meekly let this president take.
By the way, the Obama administration has also discovered that Chrysler is not a viable stand-alone corporation. Odd this should be discovered after handing it tons of your money. But not to worry, the administration says it 'stands behind' Chrysler warranties. So I guess if you have problems with your Charger, or 300M, you should drive it over to the Post Office for repairs.
It is hard to be enthusiastic about these events.
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Monday, March 30, 2009
Saturday, March 21, 2009
Are We broke?
.
According to several news reports, the proposed Obama Federal budget will lead the United States into an additional deficit of $9,300,000,000,000; that's over $9 trillion dollars.
The current national debt is $10.9 trillion dollars.
Summed up, the national debt in 2018 would be $20.2 trillion dollars.
Our CIA fact book says the United states total GDP (i. e. "the economy") is just a bit over $14 trillion.
If the government borrows money, via bonds, at 3.5%* interest, we are currently paying just over $381 billion in interest** to carry our existing national debt. We will need to add to that another $325.5 billion just to pay to borrow enough to cover the overspending of the Obama administration.
There are approximately 170 million tax filers, so on average we would need to pay an additional $1,915 each during the year to pay for the Obama spending deficit bringing our average tax load per filer to $4,159 each year just to pay interest on debt.
With a total debt of over $20 trillion and an economy sized by the GDP at $14 trillion, are we broke?
*TreasuryDirect indicates that in 2008 the total interest on national borrowing averaged 3.89%.
**TreasuryDirect shows that the total interest payments in 2008 were over $451 billion
.
According to several news reports, the proposed Obama Federal budget will lead the United States into an additional deficit of $9,300,000,000,000; that's over $9 trillion dollars.
The current national debt is $10.9 trillion dollars.
Summed up, the national debt in 2018 would be $20.2 trillion dollars.
Our CIA fact book says the United states total GDP (i. e. "the economy") is just a bit over $14 trillion.
If the government borrows money, via bonds, at 3.5%* interest, we are currently paying just over $381 billion in interest** to carry our existing national debt. We will need to add to that another $325.5 billion just to pay to borrow enough to cover the overspending of the Obama administration.
There are approximately 170 million tax filers, so on average we would need to pay an additional $1,915 each during the year to pay for the Obama spending deficit bringing our average tax load per filer to $4,159 each year just to pay interest on debt.
With a total debt of over $20 trillion and an economy sized by the GDP at $14 trillion, are we broke?
*TreasuryDirect indicates that in 2008 the total interest on national borrowing averaged 3.89%.
**TreasuryDirect shows that the total interest payments in 2008 were over $451 billion
.
Wednesday, March 18, 2009
What hath the Fed wrought?
.
Today's announcement that the private corporation called the Federal Reserve Bank (affectionately, the FED), which has the power to create money, will buy up to $300 billion worth of so-called "bad" mortgages, and United States Treasury bonds probably doesn't mean much to Joe and Jane six-pack.
People who follow the esoteric study of economic policy call it "monetizing the debt." What the heck does that mean?
Simply put the U. S. government, or its sponsored enterprises like the Federal National Mortgage Association (FannieMae), borrowed money which was created by issuing government bonds. OK so far that is like borrowing $30000 for an automobile and only being liable for the interest until you sell the car. So the "load" on your income is only the annual interest -- at 10% that would be $3,000. On a year to year basis -- you can afford the interest payments so nothing much changes in life.
What the FED has done is create some additional money to purchase the bonds. They are directly devaluing the greenback in your pocket. If you believed it buys a dollar's worth of goods today, after the FED action it buys maybe 90 cents worth of goods, simply because there are more of them, those which were created to buy the debt (bonds, mortgages, etc.).
In the case of your car loan, discussed above, it is as if you decided to pay it back with "personal consumer dollars" which you created all by yourself at home maybe on your computer. Now you can't really do that, but if you could, people would demand more of your personal "consumer dollars" because they would know you had just monetized your car value, or created more of them to buy the car.
That is what the FED is doing, and there are rumors that the bank plans to keep this up into the trillions of dollars.
Its called the "Zimbabwe solution" because it leads to enormous inflation.
I hope you are prepared. Here is a January 30, 2009 headline from the Sydney (Australia) Morning Herald: 231 million per cent inflation: Zimbabwe dumps currency. Are you ready for this?
Today's announcement that the private corporation called the Federal Reserve Bank (affectionately, the FED), which has the power to create money, will buy up to $300 billion worth of so-called "bad" mortgages, and United States Treasury bonds probably doesn't mean much to Joe and Jane six-pack.
People who follow the esoteric study of economic policy call it "monetizing the debt." What the heck does that mean?
Simply put the U. S. government, or its sponsored enterprises like the Federal National Mortgage Association (FannieMae), borrowed money which was created by issuing government bonds. OK so far that is like borrowing $30000 for an automobile and only being liable for the interest until you sell the car. So the "load" on your income is only the annual interest -- at 10% that would be $3,000. On a year to year basis -- you can afford the interest payments so nothing much changes in life.
What the FED has done is create some additional money to purchase the bonds. They are directly devaluing the greenback in your pocket. If you believed it buys a dollar's worth of goods today, after the FED action it buys maybe 90 cents worth of goods, simply because there are more of them, those which were created to buy the debt (bonds, mortgages, etc.).
In the case of your car loan, discussed above, it is as if you decided to pay it back with "personal consumer dollars" which you created all by yourself at home maybe on your computer. Now you can't really do that, but if you could, people would demand more of your personal "consumer dollars" because they would know you had just monetized your car value, or created more of them to buy the car.
That is what the FED is doing, and there are rumors that the bank plans to keep this up into the trillions of dollars.
Its called the "Zimbabwe solution" because it leads to enormous inflation.
I hope you are prepared. Here is a January 30, 2009 headline from the Sydney (Australia) Morning Herald: 231 million per cent inflation: Zimbabwe dumps currency. Are you ready for this?
Thinking about the bailout
.
I don't really know how to react to this data.
The combined value of the financial system bailout / stimulus in the Bush and Obama administrations is, as popularly reported, $1.2 trillion dollars. That is a number so big it is difficult to comprehend.
According to the Tax Foundation (which summarized IRS data), approximately 32% of US tax return filers owe no taxes. The balance of the 138 million filers bear the total burden of taxation.
Putting those two data groups together, if you in fact do pay taxes, the Bush-Obama adminstrations have just committed you personally to perpetually borrowing $12,632 with no intention of paying anything other that the interest each year. You had already been committed to a debt load of about $120,000. Now you are personally in debt through your federal government by something close to $135,000. That means that your "national" net worth - whatever it is - is lower by the same amount.
Assuming you, being the government, pay 3.5% (by issuing bonds) your federal taxes have just increased by $442 each year (in addition to approximately $4,500 you already owed each year to pay interest on your share of the national debt). As far as anyone can tell, this is the load you will pass on to your children, grandchildren and beyond. When the principal amount of the bonds come due, you - again being the government - will just issue more bonds. The principal, the national debt, will never be repaid.
The IRS numbers indicate the average taxpayer owes about $10,000 in federal taxes each year, so the added burden from the stimulus interest is an added 4% in taxes. Those are averages, and misleading, because the top 1% of taxpayers pays five times that amount according to the Tax Foundation.
Those are the numbers. Is the added debt load and annual cost worth it?
I don't really know how to react to this data.
The combined value of the financial system bailout / stimulus in the Bush and Obama administrations is, as popularly reported, $1.2 trillion dollars. That is a number so big it is difficult to comprehend.
According to the Tax Foundation (which summarized IRS data), approximately 32% of US tax return filers owe no taxes. The balance of the 138 million filers bear the total burden of taxation.
Putting those two data groups together, if you in fact do pay taxes, the Bush-Obama adminstrations have just committed you personally to perpetually borrowing $12,632 with no intention of paying anything other that the interest each year. You had already been committed to a debt load of about $120,000. Now you are personally in debt through your federal government by something close to $135,000. That means that your "national" net worth - whatever it is - is lower by the same amount.
Assuming you, being the government, pay 3.5% (by issuing bonds) your federal taxes have just increased by $442 each year (in addition to approximately $4,500 you already owed each year to pay interest on your share of the national debt). As far as anyone can tell, this is the load you will pass on to your children, grandchildren and beyond. When the principal amount of the bonds come due, you - again being the government - will just issue more bonds. The principal, the national debt, will never be repaid.
The IRS numbers indicate the average taxpayer owes about $10,000 in federal taxes each year, so the added burden from the stimulus interest is an added 4% in taxes. Those are averages, and misleading, because the top 1% of taxpayers pays five times that amount according to the Tax Foundation.
Those are the numbers. Is the added debt load and annual cost worth it?
Thursday, March 12, 2009
What's in it for you and me?
.
I can only shake my head sadly for the United States. Why? You can perform the "experiment" yourself. Just 'google' the phrase "Stimulus Package: What's in it for you?"
Ten or twelve years ago we seemed to be on a course of common sense. In those ancient days we thought that a tax and government spending program should be likened to knocking on your neighbor's door and demanding money. It had better be a very good reason the separate the friend next door from his or her money -- and should only be done sparingly.
If we applied that logic today, a number of folks seem to think its acceptable to knock on the door of the person living next door and demanding money to help pay for one's own personal mortgage, or any other of the thousands of pork items attached to the stimulus bill.
In fact, according to an article on this subject in the most recent AARP Bulletin, we are going next door and demanding our neighbors pay the state and local taxes on any new automobile we purchase in 2009. In fact, for those of us who are retired, the author of the item seems to think its OK for us to walk over to the neighbor's house and demand $250 each, cash on the barrel head, so that we personally can stimulate the economy at our discretion.
Do you remember when neighborliness was helping the person next door? Now Congress and this president have seemed to redefined the term more along the lines of shaking down that individual.
Have we become a nation of financial leeches on a personal level? Is all we ask "What's in it for me?"
The previous administration at least kept the focus on rescuing the banking industry - for a while. Confidence in the banking system -- meaning trusting that the bank will have money there when you need to withdraw it -- is a societal essential. But that administration did not seem sure which banks should fail and which should survive, leaving the perception that there were "personal favorites" within the industry. Then when the problem of unregulated derivatives (a kind of insurance in some ways) was understood, the rescue moved to investment banking and insurance companies like AIG.
Yes, that administration effectively printed money which did not exist to fund the initial TARP plan. That plan tossed our neighbor's money at some in the banking and insurance industry. How simple would it have been to use the money to shore up FDIC and simply protect each individuals bank account, while letting the weak fail no matter who they were?
The new administration and its Congress have done that twice more and House Speaker Nancy Pelosi is already hinting that another batch of money needs to be printed to give out in pet projects under the rubric of "stimulus." What are some of the things we are demanding our neighbors pay for? A list from SelfInvestor:
Dear Neighbor: We demand you pay for these things!
I can only shake my head sadly for the United States. Why? You can perform the "experiment" yourself. Just 'google' the phrase "Stimulus Package: What's in it for you?"
Ten or twelve years ago we seemed to be on a course of common sense. In those ancient days we thought that a tax and government spending program should be likened to knocking on your neighbor's door and demanding money. It had better be a very good reason the separate the friend next door from his or her money -- and should only be done sparingly.
If we applied that logic today, a number of folks seem to think its acceptable to knock on the door of the person living next door and demanding money to help pay for one's own personal mortgage, or any other of the thousands of pork items attached to the stimulus bill.
In fact, according to an article on this subject in the most recent AARP Bulletin, we are going next door and demanding our neighbors pay the state and local taxes on any new automobile we purchase in 2009. In fact, for those of us who are retired, the author of the item seems to think its OK for us to walk over to the neighbor's house and demand $250 each, cash on the barrel head, so that we personally can stimulate the economy at our discretion.
Do you remember when neighborliness was helping the person next door? Now Congress and this president have seemed to redefined the term more along the lines of shaking down that individual.
Have we become a nation of financial leeches on a personal level? Is all we ask "What's in it for me?"
The previous administration at least kept the focus on rescuing the banking industry - for a while. Confidence in the banking system -- meaning trusting that the bank will have money there when you need to withdraw it -- is a societal essential. But that administration did not seem sure which banks should fail and which should survive, leaving the perception that there were "personal favorites" within the industry. Then when the problem of unregulated derivatives (a kind of insurance in some ways) was understood, the rescue moved to investment banking and insurance companies like AIG.
Yes, that administration effectively printed money which did not exist to fund the initial TARP plan. That plan tossed our neighbor's money at some in the banking and insurance industry. How simple would it have been to use the money to shore up FDIC and simply protect each individuals bank account, while letting the weak fail no matter who they were?
The new administration and its Congress have done that twice more and House Speaker Nancy Pelosi is already hinting that another batch of money needs to be printed to give out in pet projects under the rubric of "stimulus." What are some of the things we are demanding our neighbors pay for? A list from SelfInvestor:
$20 billion for school renovations and $79 billion to avoid education related layoffs
$87 billion for Medicaid
$30 billion goes to road projects
$27 billion to continue unemployment insurance benefits
$20 billion for food stamps
$20 billion to digitize medical records
$8 billion for renewable energies
$7 billion for modernizing federal buildings
$6 billion for mass transit
$5 billion for for the construction and repair of public housing
$4 billion for community activist programs such as ACORN
$2 billion for child care subsidies
$650 million for coupons for digital TV conversions
$400 million for global warming research
$335 million for STD prevention
$50 million for National Endowment of the Arts
Dear Neighbor: We demand you pay for these things!
Friday, February 27, 2009
Are Obama and the Democrats fair?
.
I see many folks consider the BHO Democrat administration to be more "fair" and "equitable."
Here's wordnet's definition of "equitable": fair to all parties as dictated by reason and conscience; "equitable treatment of all citizens."
And their definition of "fair": free from favoritism or self-interest or bias or deception.
The BHO administration wants to raise taxes on FAMILIES making more than $250,000 in spite of his campaign promise that it would be on INDIVIDUALS making more than this amount -- the so-called "rich."
Is that action "fair"? Are those who support the administration's position being "fair."? Are they "free from deception" in this position? Free from favoritism?
Is it "equitable" by this administration to treat one class of citizens, a group they describe as "rich," differently from the rest of the citizens? Are those who support the administration's position on this issue being "equitable"?
I see many folks consider the BHO Democrat administration to be more "fair" and "equitable."
Here's wordnet's definition of "equitable": fair to all parties as dictated by reason and conscience; "equitable treatment of all citizens."
And their definition of "fair": free from favoritism or self-interest or bias or deception.
The BHO administration wants to raise taxes on FAMILIES making more than $250,000 in spite of his campaign promise that it would be on INDIVIDUALS making more than this amount -- the so-called "rich."
Is that action "fair"? Are those who support the administration's position being "fair."? Are they "free from deception" in this position? Free from favoritism?
Is it "equitable" by this administration to treat one class of citizens, a group they describe as "rich," differently from the rest of the citizens? Are those who support the administration's position on this issue being "equitable"?
Thursday, February 26, 2009
Unintended Consequences
.
This is part of a short article in the Boston Herald online.
Perhaps we should all contemplate this a little. Congress and the Executive branch are unable to see much beyond the next election - thus the actions our government take initiate a kind of "law of unintended consequences."
Can there be a better rationale for firm, enforceable term limits?
This is part of a short article in the Boston Herald online.
Fidelity’s Edward “Ned” Johnson jumped into the controversial debate over President Obama’s “New Deal II” and what Johnson called government “make-work projects.”
Without naming names, Johnson praised the administration’s effort to make economic recovery its top priority, saying it was “admirable.”
But Johnson, sounding like he’s never been a big fan of the original New Dealers from the 1930s, warned of too much government involvement in the economy and indicated Fidelity is beefing up its government-affairs unit to fend off possibly burdensome new regulations.
“We can only hope that the government’s cure doesn’t further sicken the patient,” Johnson wrote in his annual update on Fidelity’s performance over the past year.
“During the ’30s, Congress - with guidance from the president and the same kind of good intentions - shifted the country’s cash flow away from productive businesses to government make-work projects, which most likely prolonged the Great Depression,” wrote Johnson, arguably Boston’s most powerful business executive.
As for the financial-system crisis, Johnson also took a somewhat anti-government conservative view toward its causes, saying “this climate was caused by many well-intentioned policies - stimulated by individuals at high levels in government and sanctioned by regulatory structures.”
Those policies helped make “money ridiculously easy to obtain and business people eager to comply with the policies,” Johnson wrote.
Perhaps we should all contemplate this a little. Congress and the Executive branch are unable to see much beyond the next election - thus the actions our government take initiate a kind of "law of unintended consequences."
Can there be a better rationale for firm, enforceable term limits?
Friday, February 20, 2009
Heard 'round the world?
.
Have your heard CNBC reporter Rick Santelli's heartfelt blow-up?
Santelli clip.
Based upon the response - after 24 hours over 1.5 million hits on the CNBC website, over 100,000 views on YouTube, coverage by Matt Drudge, coverage by Rush Limbaugh, just to name a few - Santelli's comments struck a blow. It was about fairness by the current government which is using our money - reaching into our pockets and taking our money - to pay off mortgages for those who could not afford them in the first place (largely under rules established by the Clinton administration by the way).
Was it well-intentioned? Maybe.
Perhaps it is time for the people who paid off their mortgages, or were very careful to only take mortgages they could afford, to stand up and be heard. Has the fire against socialism been set in your mind? Are you one of the water carriers? Or do you just want to sit back and drink the water others carry for you?
Is this the shot of the 21st century which will be heard around the world?
Have your heard CNBC reporter Rick Santelli's heartfelt blow-up?
Santelli clip.
Based upon the response - after 24 hours over 1.5 million hits on the CNBC website, over 100,000 views on YouTube, coverage by Matt Drudge, coverage by Rush Limbaugh, just to name a few - Santelli's comments struck a blow. It was about fairness by the current government which is using our money - reaching into our pockets and taking our money - to pay off mortgages for those who could not afford them in the first place (largely under rules established by the Clinton administration by the way).
Was it well-intentioned? Maybe.
“It does not require a majority to prevail, but rather an irate, tireless minority keen to set brush fires in people's minds."
- Patriot Samuel Adams
Perhaps it is time for the people who paid off their mortgages, or were very careful to only take mortgages they could afford, to stand up and be heard. Has the fire against socialism been set in your mind? Are you one of the water carriers? Or do you just want to sit back and drink the water others carry for you?
Is this the shot of the 21st century which will be heard around the world?
Friday, February 13, 2009
Mortgage Subsidized
.
Lets see if I have this straight.
One of the reasons we are in this mess is because irrational mortgages (interest only, or no credit check) were made, mostly because of pressure on lenders from the Clinton administration. So we had a lot of people buying homes they could not afford under any kind of prudent lending policies.
These mortgages were repackaged at several levels into financial instruments that are now called "toxic." People cannot pay their mortgages which should not have been made to them in the first place. Houses go into foreclosure, thus depressing the entire housing market.
As a result, banks and other buyers of these derivative instruments, hold assets which they cannot sell at anywhere near the price they paid for them. Consequently, these institutions have to reserve money for "bad debt," thus reducing the amount of money they have available to lend for any reason (commercial loans for example).
The tie-up of liquidity in bad debt reserves causes at best a reduction in economic growth and at worst - since the institutions do not have sufficient funds for reserves - causes the failure of the bank.
So the solution being pushed by Democrats is to use taxpayer funds -- my money, your money -- to subsidize the payments (via interest rate subsidies) to these people who should not have been granted a loan in the first place.
Consequently, those of us who figure out how to live within our means must pay for those who do not or cannot prudently manage their personal finances.
This is a bad deal and a slap in the face by Democrats. It must be stopped.
Lets see if I have this straight.
One of the reasons we are in this mess is because irrational mortgages (interest only, or no credit check) were made, mostly because of pressure on lenders from the Clinton administration. So we had a lot of people buying homes they could not afford under any kind of prudent lending policies.
These mortgages were repackaged at several levels into financial instruments that are now called "toxic." People cannot pay their mortgages which should not have been made to them in the first place. Houses go into foreclosure, thus depressing the entire housing market.
As a result, banks and other buyers of these derivative instruments, hold assets which they cannot sell at anywhere near the price they paid for them. Consequently, these institutions have to reserve money for "bad debt," thus reducing the amount of money they have available to lend for any reason (commercial loans for example).
The tie-up of liquidity in bad debt reserves causes at best a reduction in economic growth and at worst - since the institutions do not have sufficient funds for reserves - causes the failure of the bank.
So the solution being pushed by Democrats is to use taxpayer funds -- my money, your money -- to subsidize the payments (via interest rate subsidies) to these people who should not have been granted a loan in the first place.
Consequently, those of us who figure out how to live within our means must pay for those who do not or cannot prudently manage their personal finances.
This is a bad deal and a slap in the face by Democrats. It must be stopped.
Tuesday, February 10, 2009
Health Care in Stimulus Package
.
There are a lot of troubling items being shoved through Congress in the name of "Economic Crisis." One of most concern is the National Healthcare Information Technology Chief, who will be granted the right to determine if physicians and hospitals are "meaningful users" of the Federal Government's health information about you. From Bloomberg News (page numbers refer to the pdf version of HR 1):
A key word here is "atypical." It is my observation that most healthcare is delivered on a probability basis. Your symptoms are analyzed and compared to a curve of probable distribution regarding what the appropriate treatment should be. For sake of argument, lets say the recommended care will result in medical correction about 2/3 of the time. If your medical problem falls outside of the normal distribution central area (maybe plus or minus two standard deviations), your medical case is considered "atypical."
In a case of an atypical medical problem, your physician (or dentist for that matter), will have to take the time to delve into your symptoms much more thoroughly. That will consume more time - and cost more money. I have experienced just such a situation personally.
It looks like what the government is telling us is that some bureaucrat in Washington will insist that your physicians, surgeons, and dental practitioners stop your care (under the rationale that it will be "costly" as they define it) if your medical situation cannot be resolved using some middle ground on the curve of likely results distribution.
We need to make sure this is removed from the Economic Stimulus package for many reasons, not the least of which is that you - the American citizen - deserve the right to have your medical condition thoroughly diagnosed should you choose to have it done.
There are a lot of troubling items being shoved through Congress in the name of "Economic Crisis." One of most concern is the National Healthcare Information Technology Chief, who will be granted the right to determine if physicians and hospitals are "meaningful users" of the Federal Government's health information about you. From Bloomberg News (page numbers refer to the pdf version of HR 1):
Hospitals and doctors that are not “meaningful users” of the new system will face penalties. “Meaningful user” isn’t defined in the bill. That will be left to the HHS secretary, who will be empowered to impose “more stringent measures of meaningful use over time” (511, 518, 540-541)
What penalties will deter your doctor from going beyond the electronically delivered protocols when your condition is atypical or you need an experimental treatment? The vagueness is intentional.
A key word here is "atypical." It is my observation that most healthcare is delivered on a probability basis. Your symptoms are analyzed and compared to a curve of probable distribution regarding what the appropriate treatment should be. For sake of argument, lets say the recommended care will result in medical correction about 2/3 of the time. If your medical problem falls outside of the normal distribution central area (maybe plus or minus two standard deviations), your medical case is considered "atypical."
In a case of an atypical medical problem, your physician (or dentist for that matter), will have to take the time to delve into your symptoms much more thoroughly. That will consume more time - and cost more money. I have experienced just such a situation personally.
It looks like what the government is telling us is that some bureaucrat in Washington will insist that your physicians, surgeons, and dental practitioners stop your care (under the rationale that it will be "costly" as they define it) if your medical situation cannot be resolved using some middle ground on the curve of likely results distribution.
We need to make sure this is removed from the Economic Stimulus package for many reasons, not the least of which is that you - the American citizen - deserve the right to have your medical condition thoroughly diagnosed should you choose to have it done.
Monday, February 9, 2009
Does stimulus money really exist?
.
Today, in Elkhart Indiana, President Obama said something along the lines of: If people don't have money, people can't spend money.
Assuming for a moment that is a correct statement, it begs the question to be asked: can government spend money it does not have?
He did not answer that, to my knowledge.
Today, in Elkhart Indiana, President Obama said something along the lines of: If people don't have money, people can't spend money.
Assuming for a moment that is a correct statement, it begs the question to be asked: can government spend money it does not have?
He did not answer that, to my knowledge.
Saturday, February 7, 2009
The President votes "Present"
.
One of the campaign issues raised concerning Barack Hussein Obama was that his record, both as a junior Illinois legislator and as a junior Illinois senator, was his overwhelming record of voting "present."
We learn today that with his version of an economic "stimulus" in some trouble in Washington (as you read in a previous entry, he defines stimulus as government spending, whether it has the money or not), Barack Hussein has decided it was imperative - after a mere two weeks in DC, to head to Camp David.
This was a NYT headline reported on Google: 'Put This Plan in Motion,’ Obama Urges Lawmakers.
Let them do it, he seems to be saying. I will vote 'present' - but from a distance.
Given his rapidly diminishing poll approvals - it looks like America is beginning to realize they were sold a pig in a poke regarding "Hope and Change."
Too bad.
One of the campaign issues raised concerning Barack Hussein Obama was that his record, both as a junior Illinois legislator and as a junior Illinois senator, was his overwhelming record of voting "present."
We learn today that with his version of an economic "stimulus" in some trouble in Washington (as you read in a previous entry, he defines stimulus as government spending, whether it has the money or not), Barack Hussein has decided it was imperative - after a mere two weeks in DC, to head to Camp David.
This was a NYT headline reported on Google: 'Put This Plan in Motion,’ Obama Urges Lawmakers.
Let them do it, he seems to be saying. I will vote 'present' - but from a distance.
Given his rapidly diminishing poll approvals - it looks like America is beginning to realize they were sold a pig in a poke regarding "Hope and Change."
Too bad.
Obama and McCain clash?
.
George Bernard Shaw wrote that "England and America are two countries separated by a common language."
In my working career I found that what appeared to be disagreements over an issue almost always ended up sourced in the definition of terms. I would joke that I failed to understand how anyone understood anyone else because we were separated by a common language.
Yesterday Sen. John McCain spoke out against the Obama administration stimulus, arguing for tax incentives to stimulate the economy, Obama, on the other hand, dissed Republican criticism of his plan being nothing more than spending by arguing that spending was the definition of stimulus.
So there we go again -- using the same terms to describe different things.
To conservatives, the less intrusive government is - especially in terms of taxation - the more business, notably small business which is the largest employer in aggregate, flourishes.
To liberals, nothing but the right the spend taxpayers money - in today's case wealth that the government does not have - will stimulate "the economy."
The discussion will no doubt continue ad nauseum. When you listen to it, remember that each side is defining terms differently.
George Bernard Shaw wrote that "England and America are two countries separated by a common language."
In my working career I found that what appeared to be disagreements over an issue almost always ended up sourced in the definition of terms. I would joke that I failed to understand how anyone understood anyone else because we were separated by a common language.
Yesterday Sen. John McCain spoke out against the Obama administration stimulus, arguing for tax incentives to stimulate the economy, Obama, on the other hand, dissed Republican criticism of his plan being nothing more than spending by arguing that spending was the definition of stimulus.
So there we go again -- using the same terms to describe different things.
To conservatives, the less intrusive government is - especially in terms of taxation - the more business, notably small business which is the largest employer in aggregate, flourishes.
To liberals, nothing but the right the spend taxpayers money - in today's case wealth that the government does not have - will stimulate "the economy."
The discussion will no doubt continue ad nauseum. When you listen to it, remember that each side is defining terms differently.
Stimulus Projections
.
As many of you have read, the Congressional Budget Office (theoretically non-partisan) states that the Obama stimulus will have a negative effect on the gross domestic product. Others report that over 50% of the $800 billion Obama package is solely for the benefit of unions, although I do not know the details of that assertion.
Nevertheless -- is this what we are in for?
As many of you have read, the Congressional Budget Office (theoretically non-partisan) states that the Obama stimulus will have a negative effect on the gross domestic product. Others report that over 50% of the $800 billion Obama package is solely for the benefit of unions, although I do not know the details of that assertion.
Nevertheless -- is this what we are in for?
Friday, February 6, 2009
Unemployment
.
The labor department just released unemployment figures. The media outlets scream: MORE UNEMPLOYED SINCE 1992, NEARLY 598,000 JOBS LOST.
So I looked at the Department of Labor's website.
Sure enough: their press release lead paragraph is:
Then I took a look at Table A-1. Table A1
If I read it correctly, 5.643,000 people would like a job out of a non-institutional labor force of 153,716,000 workers.
I make that to be just under 3.7% of the workforce is seeking employment.
A year ago 3.3% of the non-institutional workforce was seeking a job.
It seems to me there is a difference between not choosing to work, and wanting to work.
Why does the DoL want to dramatize the higher number?
Something about the "Lying liars that lead them" maybe?
The labor department just released unemployment figures. The media outlets scream: MORE UNEMPLOYED SINCE 1992, NEARLY 598,000 JOBS LOST.
So I looked at the Department of Labor's website.
Sure enough: their press release lead paragraph is:
THE EMPLOYMENT SITUATION: JANUARY 2009
Nonfarm payroll employment fell sharply in January (-598,000) and the unem-
ployment rate rose from 7.2 to 7.6 percent, the Bureau of Labor Statistics of
the U.S. Department of Labor reported today. Payroll employment has declined
by 3.6 million since the start of the recession in December 2007; about one-
half of this decline occurred in the past 3 months. In January, job losses
were large and widespread across nearly all major industry sectors.
Then I took a look at Table A-1. Table A1
If I read it correctly, 5.643,000 people would like a job out of a non-institutional labor force of 153,716,000 workers.
I make that to be just under 3.7% of the workforce is seeking employment.
A year ago 3.3% of the non-institutional workforce was seeking a job.
It seems to me there is a difference between not choosing to work, and wanting to work.
Why does the DoL want to dramatize the higher number?
Something about the "Lying liars that lead them" maybe?
Obama Popularity
.
The February 5th Rasmussen poll website reports that Obama's approval rating is slipping, and in fact is lower than George W. Bush's was at the same point in his presidency.
What is striking to me is not the high approval among people who consider themselves Democrats, nor the low approval among those who self-identify as Republicans ... it is his surprising low rating of about 30% among the non-aligned.
Obama likes to throw his weight around by telling those who oppose his ideas "I won," implying of course that somehow all American voters totally support any cockamamie idea he comes up with. While his attitude shows his arrogance, and hints at the totalitarian approach the left wants to take (Sen. Harry Reid and Speaker Nancy Pelosi are also good models of this attitude), it simply does not "play in Peoria" with common Americans who still seem to be slightly right of center in outlook.
Remember this is a president who as a legislator built a reputation on voting "Present" - and accumulating political power through associations with former radicals.
The February 5th Rasmussen poll website reports that Obama's approval rating is slipping, and in fact is lower than George W. Bush's was at the same point in his presidency.
What is striking to me is not the high approval among people who consider themselves Democrats, nor the low approval among those who self-identify as Republicans ... it is his surprising low rating of about 30% among the non-aligned.
Obama likes to throw his weight around by telling those who oppose his ideas "I won," implying of course that somehow all American voters totally support any cockamamie idea he comes up with. While his attitude shows his arrogance, and hints at the totalitarian approach the left wants to take (Sen. Harry Reid and Speaker Nancy Pelosi are also good models of this attitude), it simply does not "play in Peoria" with common Americans who still seem to be slightly right of center in outlook.
Remember this is a president who as a legislator built a reputation on voting "Present" - and accumulating political power through associations with former radicals.
Thursday, February 5, 2009
U. S. Economy
.
Yesterday's business news coverage was about the Madoff situation - and it certainly sounds like a Ponzi scheme. That's where the principal invested by new buyers is used to pay previous owners a "return on investment." Obviously at some point there are not enough new investors to keep the scheme going. If you ever thought your bank was a conservative place for storing your wealth, just notice that some of the big names who bought into the Madoff scheme were UBS, and Bank of America.
Hidden somewhat in the day's coverage were reports that the housing price collapse may have more distance to travel. I found this chart on the internet and added some trend lines.
With Congress in a mood to toss money at the problem, $900 billion in addition to the previous $700 billion, with all of the attendant pork Washington infamously adds to such legislation, its hard to see how we can work ourselves out of this problem in less than a year. Precious metals trader James Sinclair has written that Obama will very soon realize he has been "had" -- that there is no easy way out of the economic collapse and with the added "stimulus" he will "own the problem" politically. That may mean he is - at best - a one term president.
That will still leave the question open of 'where was the SEC during the Bush administration.' Many of us prefer a minimum of government interference in finances, but that does not mean we expect the regulatory arm in Washington to be asleep while predators like Madoff roam the markets. As one person told me: that's like having a room full of three-year olds without any discipline. Free markets should not be undisciplined markets.
Just how big is the $1.6 trillion dollars we have created from whole cloth to toss into the fray as stimulus? As Sen. Mitch Connell said, if one spent a million dollars a year since the birth of Jesus, we would only have totaled something just over $770 billion through 2,009 years. In short, the size of the so-called stimulus is mind-boggling.
U. K. Prime Minister Gordon Brown during Parliament's question time slipped and probably accurately said that the entire world is entering a depression. The scary thing is that with all the world-wide money being thrown out to solve the crisis, we may also be facing a period of hyperinflation similar to that of the Weimar Republic.
I'm making no investment suggestions here - I'm not qualified to do so - but I would suggest we all hang on to our hats for this ride over the next few years. As the Cole Porter tune goes "now I suppose, anything goes."
Yesterday's business news coverage was about the Madoff situation - and it certainly sounds like a Ponzi scheme. That's where the principal invested by new buyers is used to pay previous owners a "return on investment." Obviously at some point there are not enough new investors to keep the scheme going. If you ever thought your bank was a conservative place for storing your wealth, just notice that some of the big names who bought into the Madoff scheme were UBS, and Bank of America.
Hidden somewhat in the day's coverage were reports that the housing price collapse may have more distance to travel. I found this chart on the internet and added some trend lines.
With Congress in a mood to toss money at the problem, $900 billion in addition to the previous $700 billion, with all of the attendant pork Washington infamously adds to such legislation, its hard to see how we can work ourselves out of this problem in less than a year. Precious metals trader James Sinclair has written that Obama will very soon realize he has been "had" -- that there is no easy way out of the economic collapse and with the added "stimulus" he will "own the problem" politically. That may mean he is - at best - a one term president.
That will still leave the question open of 'where was the SEC during the Bush administration.' Many of us prefer a minimum of government interference in finances, but that does not mean we expect the regulatory arm in Washington to be asleep while predators like Madoff roam the markets. As one person told me: that's like having a room full of three-year olds without any discipline. Free markets should not be undisciplined markets.
Just how big is the $1.6 trillion dollars we have created from whole cloth to toss into the fray as stimulus? As Sen. Mitch Connell said, if one spent a million dollars a year since the birth of Jesus, we would only have totaled something just over $770 billion through 2,009 years. In short, the size of the so-called stimulus is mind-boggling.
U. K. Prime Minister Gordon Brown during Parliament's question time slipped and probably accurately said that the entire world is entering a depression. The scary thing is that with all the world-wide money being thrown out to solve the crisis, we may also be facing a period of hyperinflation similar to that of the Weimar Republic.
I'm making no investment suggestions here - I'm not qualified to do so - but I would suggest we all hang on to our hats for this ride over the next few years. As the Cole Porter tune goes "now I suppose, anything goes."
Sunday, February 1, 2009
Why Not Buy American?
.
A clip from the San Francisco Examiner:
"Buy American" is one of those phrases that sound right, but the world's Free Traders don't like it at all.
Lets face it - Free Trade means finding the lowest cost producer in many cases. Its why we no longer have a textile industry in the United States. Labor was cheaper elsewhere in the world. So we put Americans out of work, in order that other Americans buy products which has a greater profit margin to corporations.
Instead of a open-ended free trade policy, why wouldn't we say that those countries who support our political objectives world-wide are automatically free trade partners, and those who oppose it are not. Oh yeah, we want Hugo Chavez's oil and gas.
We in the United States are allowing these policies to weaken our superpower status.
A clip from the San Francisco Examiner:
House Democrats insisted on including “Buy American” provisions in the $825 billion economic stimulus bill. The provisions — which are mirrored in the Senate Democrats’ version of the legislation — require that federal funds for stimulus projects can be spent on steel and iron only from domestic producers.
That’s another way of telling foreign producers to keep out. Such trade barriers damage economic growth just like tariffs that make goods imported from overseas cost more
"Buy American" is one of those phrases that sound right, but the world's Free Traders don't like it at all.
Lets face it - Free Trade means finding the lowest cost producer in many cases. Its why we no longer have a textile industry in the United States. Labor was cheaper elsewhere in the world. So we put Americans out of work, in order that other Americans buy products which has a greater profit margin to corporations.
Instead of a open-ended free trade policy, why wouldn't we say that those countries who support our political objectives world-wide are automatically free trade partners, and those who oppose it are not. Oh yeah, we want Hugo Chavez's oil and gas.
We in the United States are allowing these policies to weaken our superpower status.
Thursday, January 29, 2009
The Democrat Majority
.
Yesterday the House of Representatives, along strict party lines, approved the expenditure of nearly $900 BILLION of our tax dollars (which do not exist by the way) to be used to 'rescue' the economy. While $335 million of that is for STD prevention, clearly unrelated to any economic issues facing us, we need to think about just how big this Democrat majority is.
Obama won the presidential election by a vote of 54% to 46%. How big was that majority?
Imagine yourself in a room with 50 people. 27 of them voted for Obama, and 23 of them voted for an alternative. If THREE people had voted the other way, the alternative, John McCain, would have prevailed by 52% to 48%.
So our country's financial future is being determined by three people in fifty. These three voters in our room of fifty are the reason this deficit spending plan is being steamrollered through Congress.
Three in fifty.
Is that what we wanted?
Yesterday the House of Representatives, along strict party lines, approved the expenditure of nearly $900 BILLION of our tax dollars (which do not exist by the way) to be used to 'rescue' the economy. While $335 million of that is for STD prevention, clearly unrelated to any economic issues facing us, we need to think about just how big this Democrat majority is.
Obama won the presidential election by a vote of 54% to 46%. How big was that majority?
Imagine yourself in a room with 50 people. 27 of them voted for Obama, and 23 of them voted for an alternative. If THREE people had voted the other way, the alternative, John McCain, would have prevailed by 52% to 48%.
So our country's financial future is being determined by three people in fifty. These three voters in our room of fifty are the reason this deficit spending plan is being steamrollered through Congress.
Three in fifty.
Is that what we wanted?
Saturday, January 24, 2009
Obama attempts to split Republicans
.
Some very interesting news reported yesterday.
During a conference on the bailout, Obama is said to have told the Republican conferees who objected to some points of his economic plan 'I won,' implying of course that they didn't. President Bush said something quite similar about spending political capital after his 2004 re-election. The press pilloried Bush, but has given Obama a free ride. Nothing new there, but worth pointing out -- as we know that at least MSNBC's political reporter Chris Matthews thinks the free press must do everything it can to make Obama successful.
The second point was that Obama told Republicans that if they thought they wanted to get anything into his economic recovery plan, they needed to stop listening to Rush Limbaugh. This too is getting plenty of press coverage.
Both of these points make a great deal of sense, and conform to the Republican malaise - the split between conservatives and Republican liberals like McCain.
Obama is merely doing what Democrats do -- he is trying to lead the consolidation of power not by cooperating with the opposition as far as possible, but trying to hasten its demise.
At the end of the month of January, Republicans will elect an RNC leader. They will demonstrate with their choice whether they wish to be conservatives, or what one pundit has called 'Democrats-lite." McCain is already signaling he will go along with some number of Obama policies.
Unfortunately, my view is that George Bush himself brought this split along in two areas: refusing to fund the War on Terror with even a symbolic tax surcharge, and ultimately (and more significantly) generating huge deficits by allowing the Treasury to print unbacked dollars to 'rescue' some companies, AIG - BAC - Citi - GM to name a few, and not rescue others, Bear-Stearns being the big name there.
If the Republicans choose to position themselves as Democrats-lite, it will leave many of us small government conservatives looking for a new home -- much as we did in 1992 with none other than George Herbert Walker Bush. Sometimes symmetry is striking, isn't it?
We await the end of January.
Some very interesting news reported yesterday.
During a conference on the bailout, Obama is said to have told the Republican conferees who objected to some points of his economic plan 'I won,' implying of course that they didn't. President Bush said something quite similar about spending political capital after his 2004 re-election. The press pilloried Bush, but has given Obama a free ride. Nothing new there, but worth pointing out -- as we know that at least MSNBC's political reporter Chris Matthews thinks the free press must do everything it can to make Obama successful.
The second point was that Obama told Republicans that if they thought they wanted to get anything into his economic recovery plan, they needed to stop listening to Rush Limbaugh. This too is getting plenty of press coverage.
Both of these points make a great deal of sense, and conform to the Republican malaise - the split between conservatives and Republican liberals like McCain.
Obama is merely doing what Democrats do -- he is trying to lead the consolidation of power not by cooperating with the opposition as far as possible, but trying to hasten its demise.
At the end of the month of January, Republicans will elect an RNC leader. They will demonstrate with their choice whether they wish to be conservatives, or what one pundit has called 'Democrats-lite." McCain is already signaling he will go along with some number of Obama policies.
Unfortunately, my view is that George Bush himself brought this split along in two areas: refusing to fund the War on Terror with even a symbolic tax surcharge, and ultimately (and more significantly) generating huge deficits by allowing the Treasury to print unbacked dollars to 'rescue' some companies, AIG - BAC - Citi - GM to name a few, and not rescue others, Bear-Stearns being the big name there.
If the Republicans choose to position themselves as Democrats-lite, it will leave many of us small government conservatives looking for a new home -- much as we did in 1992 with none other than George Herbert Walker Bush. Sometimes symmetry is striking, isn't it?
We await the end of January.
Thursday, January 22, 2009
Its time to criticize Obama
In a recent Wall Street Journal column, African-American political commentator Juan Williams made the following point concerning criticism of the Obama administration:
Williams' implication is clear - to treat Obama as a 'fragile flower' is in itself racist.
I hear too many, particular on the right, saying they must help this president, they must stifle their criticism of his policies.
I do not think so.
In fact, I think the political discourse should be as vigorous now from the right, as it has been from the left the past eight years.
“If his presidency is to represent the full power of the idea that black Americans are just like everyone else — fully human and fully capable of intellect, courage, and patriotism — then Barack Obama has to be subject to the same rough and tumble of political criticism experienced by his predecessors.”
Williams' implication is clear - to treat Obama as a 'fragile flower' is in itself racist.
I hear too many, particular on the right, saying they must help this president, they must stifle their criticism of his policies.
I do not think so.
In fact, I think the political discourse should be as vigorous now from the right, as it has been from the left the past eight years.
Tuesday, January 20, 2009
The re-education of reporters
.
In private discussions I often argue that reporters need to be re-educated in American government. This example is from a Wall Street Journal piece about the inauguration of Barack Hussein Obama as president.
Lets look at the paragraph.
1. Republican rule - In the United States our politicians govern, they do not rule. Monarchs rule, Presidents govern. Its that simple, and seemingly not understood by the Fifth Estate.
2. Bush's restrictions on federal funding for embryonic stem cell research - the Bush administration really increased funding for stem cell research. What they did do is restrict the harvesting of new stem cell lines from aborted embryos. There is a difference.
3. Restoring funding for family-planning overseas - while the question should be asked why the United States is funding actions in other countries, the fact is that the restriction was on using U. S. funding to support abortion.
We need accuracy in language which will lead to accuracy in reporting. But I doubt we will get it.
In private discussions I often argue that reporters need to be re-educated in American government. This example is from a Wall Street Journal piece about the inauguration of Barack Hussein Obama as president.
That's just one of the new policies symbolizing the change to come as Washington shifts from eight years of Republican rule under George W. Bush. Within days, Mr. Obama also is expected to issue executive orders to begin closing the prison in Guantanamo Bay, Cuba, one of the most controversial symbols of the Bush administration's war on terror; reversing Mr. Bush's restrictions on federal funding for embryonic stem-cell research, and restoring funding for family-planning programs overseas.
Lets look at the paragraph.
1. Republican rule - In the United States our politicians govern, they do not rule. Monarchs rule, Presidents govern. Its that simple, and seemingly not understood by the Fifth Estate.
2. Bush's restrictions on federal funding for embryonic stem cell research - the Bush administration really increased funding for stem cell research. What they did do is restrict the harvesting of new stem cell lines from aborted embryos. There is a difference.
3. Restoring funding for family-planning overseas - while the question should be asked why the United States is funding actions in other countries, the fact is that the restriction was on using U. S. funding to support abortion.
We need accuracy in language which will lead to accuracy in reporting. But I doubt we will get it.
Monday, January 12, 2009
Be open-minded
.
I see that George W. Bush is reported to have advised Republicans to be "open-minded" on the issues relating to immigrants.
Let me see if I get this straight:
- to oppose illegally entering this country is closed minded?
- to suggest some sort of amnesty for those who are here illegally is open minded?
- to think that we need a "time out" on even legal immigration to determine just what our future policies should be is closed minded?
- to fail to secure our borders is open minded?
There is a limit to the resources available in the United States. We cannot allow legal immigration to stress those resources, let alone allow illegal immigration to overwhelm them.
Thanks George, but I'll just stay closed-minded -- as you see it. Your record on the economy is far from stellar anyway.
I see that George W. Bush is reported to have advised Republicans to be "open-minded" on the issues relating to immigrants.
Let me see if I get this straight:
- to oppose illegally entering this country is closed minded?
- to suggest some sort of amnesty for those who are here illegally is open minded?
- to think that we need a "time out" on even legal immigration to determine just what our future policies should be is closed minded?
- to fail to secure our borders is open minded?
There is a limit to the resources available in the United States. We cannot allow legal immigration to stress those resources, let alone allow illegal immigration to overwhelm them.
Thanks George, but I'll just stay closed-minded -- as you see it. Your record on the economy is far from stellar anyway.
Saturday, January 10, 2009
Why Franken Won
.
As you probably know, after a long "recount" Al Franken holds the lead by some 225 votes in the Minnesota senatorial election. While Coleman has legally challenged this result citing something in the neighborhood of 2,500 ballots which were not counted, I have a theory about why the citizens of Minnesota would vote for a person as unqualified for office as Franken.
It is this: They thought they were voting for Garrison Keillor.
'Nuf said.
As you probably know, after a long "recount" Al Franken holds the lead by some 225 votes in the Minnesota senatorial election. While Coleman has legally challenged this result citing something in the neighborhood of 2,500 ballots which were not counted, I have a theory about why the citizens of Minnesota would vote for a person as unqualified for office as Franken.
It is this: They thought they were voting for Garrison Keillor.
'Nuf said.
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