Free Markets, Free People

Daily Archives: July 5, 2010


NASA’s new frontier – Muslim self-esteem?

It appears so.

Charles Bolden, head of NASA, tells Al Jazeera that the "foremost" task President Obama has given him is "to find a way to reach out to the Muslim world and engage much more with predominantly Muslim nations to help them feel good about their historic contribution to science, math, and engineering." Thus, NASA’s primary mission is no longer to enhance American science and engineering or to explore space, but to boost the self-esteem of "predominantly Muslim nations."

Seriously.  Watch the video at Powerline.  An 18.5 billion budget spent on self-esteem outreach?  Because, per the Obama administration, NASA no longer has a space exploration mission.  In fact, as Powerline points out, space exploration didn’t even make the top three priority missions Bolden is charged with:

The other two are "re-inspire children to want to get into science and math" and "expand our international relationships.

So essentially NASA’s new mission is a) muslim outreach and self-esteem bolstering, b) exciting kids about science and math and c) expand international relationships, obviously not for space exploration though.  Now that’s leadership.

And you wonder why we’re going broke, heading toward mediocrity and have clueless leadership engaged in misusing an expensive agency for self-esteem projects on your dime?

See the results of the election held in November of 2008.

~McQ


It isn’t rocket science, Mr. President

Seriously, by now just about anyone – to include the President’s panel of economic advisers – should be able to figure out why there are no jobs. The QoD below tells you why in so many words. Fareed Zakaria tells you why without mincing words:

The key to a sustainable recovery and robust economic growth is to get companies investing in America. So why are they reluctant, despite having mounds of cash? I put this question to a series of business leaders, all of whom were expansive on the topic yet did not want to be quoted by name, for fear of offending people in Washington.

Economic uncertainty was the primary cause of their caution. "We’ve just been through a tsunami and that produces caution," one told me. But in addition to economics, they kept talking about politics, about the uncertainty surrounding regulations and taxes. Some have even begun to speak out publicly. Jeffrey Immelt, chief executive of General Electric, complained Friday that government was not in sync with entrepreneurs. The Business Roundtable, which had supported the Obama administration, has begun to complain about the myriad laws and regulations being cooked up in Washington.

In other words, back off, get out of the freaking way, quit talking about massive new taxes and programs that deincentivize investment and employment, and let the 1.8 trillion in cash sitting on the sidelines in private hands do its job.

Wow, I wish I’d been saying that for, oh, 18 months or so.

It still astounds me, though, that I and others are still beating this drum this late into this economic disaster.  As the title points out – this isn’t rocket science.  Incentives work to increase behavior you want, disincentives work to discourage behavior  you don’t want.   If you talk about making it harder and more expensive to hire someone, you disincentivize hiring.  Same with investment.

And that’s precisely what’s going on.

One CEO told me, "Almost every agency we deal with has announced some expansion of its authority, which naturally makes me concerned about what’s in store for us for the future." Another pointed out that between the health-care bill, financial reform and possibly cap-and-trade, his company had lawyers working day and night to figure out the implications of all these new regulations.

The immediate implication is they’re sitting on the sidelines, sitting on their cash instead of investing it, and they’re not hiring.  And every reason you seen listed above has to do with government.  Not down markets, or lack of demand, or whatever else one might want to blame on “capitalism”. 

Of course, as an aside, I have little sympathy for many of these CEOs.  They’ve learned you get what you vote for:

Most of the business leaders I spoke to had voted for Barack Obama. They still admire him. Those who had met him thought he was unusually smart. But all think he is, at his core, anti-business.

Yet these titans of industry and banking apparently weren’t astute enough, or didn’t want to look under the veneer this “smart” guy presented.  Seems interesting to me that they never got it, but many of us out here in fly-over land saw through candidate Obama immediately. 

Now they – and we – are paying a pretty high price for voting for someone they see as “anti-business” and apparently clueless about how to do what is necessary (or, perhaps, unwilling) to settle the markets, help establish a positive business climate and provide incentives for flowing that 1.8 trillion (it won’t cost the taxpayers a dime) into the economy and spur expansion and hiring.

They must be so pleased with the regime they’ve helped put into place, given their current positions on the sidelines trying to figure out how to stay in business.

Brilliant!

~McQ


Quote of the day – jobless “recovery” edition

Great rant in the Las Vegas Review Journal by Wayne Allyn Root in which he points out the obvious – President Obama wouldn’t know how to create a job if his life depended on it.  However, it appears he certainly knows how to kill any incentives to create jobs.  Key graf:

I’ve polled all my friends who own small businesses — many of them in the Internet and high-tech fields. They all agree that in this new Obama world of high business taxes, income taxes, payroll taxes, capital gains taxes, and workers compensation taxes, the key to success is to avoid employees. The only way to survive as a business owner today is by keeping the payroll very low and by hiring only independent contractors or part-time employees provided by temp agencies.

There in a nutshell is why you see employers sitting on the sidelines – government has made it too expensive to hire new ones.  Literally.  So businesses are looking at ways to do the same thing they’re doing with fewer employees, and, if they need some help, looking to independent contractors (1099 hires) to fill the void.  They require nothing in terms of health care, social security, or other tax collections.  They can be let go at a moment’s notice.  They are, at least in my opinion, the way many small businesses will choose to “hire” in the coming years, or, as long as they are essentially penalized for hiring new employees.

Root goes on to call Obama the “great job destroyer”.  I’m not sure I’d go that far, but I think the policies he and the Democrats are putting in place (to include their obvious union preferences) are extremely damaging to the employment outlook and because of them, we’re going to see high single digit unemployment for a while.  In fact, because of the fact that employers are being penalized for hiring new employees, high single digit unemployment may become the new “norm”.

~McQ


Krugman and Pelosi – two peas in an economic pod

Remember a few days ago I pointed out how Nancy Pelosi was out and about claiming that unemployment benefits was the greatest job creator in the world?

Well guess where she probably got it from – Paul Krugman?

Wait: there’s more. One main reason there aren’t enough jobs right now is weak consumer demand. Helping the unemployed, by putting money in the pockets of people who badly need it, helps support consumer spending. That’s why the Congressional Budget Office rates aid to the unemployed as a highly cost-effective form of economic stimulus. And unlike, say, large infrastructure projects, aid to the unemployed creates jobs quickly — while allowing that aid to lapse, which is what is happening right now, is a recipe for even weaker job growth, not in the distant future but over the next few months.

I won’t bother you with the reasoning that says this is absolute nonsense – that was covered in the Pelosi post.  What’s surprising is how desperate Krugman is to have his way with increased deficit spending – to stoop to this level of argument.  Suffice it to say, this doesn’t increase “consumer demand” or support “consumer spending”.  Unemployment benefits are a fraction of what the household was making before so what it goes toward is the maintenance of necessities and not much else.

To see a Nobel prize winning economist reduced to this  – a political hack – is rather revealing.  It certainly, at least in my mind, makes everything he writes that is purportedly about his specialty suspect.  If this is his argument, then he hasn’t got an argument, and if you read the rest of his screed you’ll discover it is only an excuse to attack the GOP – falsely, of course.

Krugman has all but ruined his reputation as an economist with nonsense like this. Of course when a person becomes identified with the clueless, like Nancy Pelosi, and their arguments, the decent into full “hackery” is complete.

~McQ

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