Free Markets, Free People

Daily Archives: March 29, 2012


Economic Statistics for 29 Mar 12

The following statistics were released today on the state of the US economy:

The Commerce Department’s final estimate for 4Q GDP was 3% annualized, matching analysts’ expectations.

Initial jobless claims in the March 24 week fell 5,000 to 359,000 from a revised 364,000 in the prior week.

Corporate profits in the fourth quarter shrank to $1.494 trillion annualized, compared to $1.502 trillion in the third quarter.

The Bloomberg Consumer Comfort Index rose to -34.7, simultaneously a recessionary reading, yet the 2nd highest in four years.

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Dale Franks
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Ruminations about SCOTUS/ObamaCare

A lot has been said and written about the oral arguments before the Supreme Court concerning ObamaCare.  Many have claimed you can’t base much on such arguments.

Perhaps.  But it seems to me that you can get an indication of the mood of the court if you consider them carefully and keep them in context.

What I’ve surmised over the past few days is the law is in deep trouble.  I think, if nothing else, the oral arguments pointed out how dismally weak and poor the arguments “for” this law are.

Of course, depending on how they would like to see the court rule, each side has found ways to spin these arguments to support their hoped for result.  No huge surprise there.

But I think the one thing that is clear is the court is pretty well split down the middle and along ideological lines.  And, as we’ve said for some time, in reality the result will hinge on the vote of Justice Kennedy.

However, I think you have to keep in mind that it won’t be a single ruling but one which entails several votes.  One on the individual mandate, one on severability and possibly, depending on how the severability vote goes, if portions or the whole bill ought to be struck down.  If the whole law is struck down, of course the expanded Medicare portion discussed yesterday will go with it.

That leaves you wondering where Kennedy is in his deliberation of the case.  Again, if looking at indications to be gleaned from the oral arguments, one could assume he finds it true that the individual mandate would “fundamentally change” the citizen’s relationship with government – and not to the citizen’s favor.  I think it is also true that he is not satisfied that the government has successfully articulated a “limiting principle” – a critical and key point in the discussion.

Finally, I get the impression, from yesterday’s arguments, that Kennedy is leaning toward “paving over” the whole law.  In other words, giving Congress a “do over” since taking the mandate out would create a law and a consequence that it is hard to argue was Congress’s original intent.  What is also interesting is the developing opinion that striking down the entire law would actually be an exercise in judicial restraint, not judicial activism.

Justice Ruth Bader Ginsburg said Mr. Clement is asking the Court to conduct "a wrecking operation," before stating that "the more conservative approach would be salvage rather than throwing out everything." The Obama Administration didn’t say exactly that, but it did argue that the mandate is indispensable to its supposedly well-oiled regulatory scheme and if it is thrown out the insurance rules should be too.

But Justice Anthony Kennedy doubted Justice Ginsburg’s logic, since by taking out only the individual mandate the Court would in effect be creating a new law that Congress "did not provide for, did not consider." To wit, costs would soar without any mechanism to offset them.

"When you say judicial restraint," Justice Kennedy said, "you are echoing the earlier premise that it increases the judicial power if the judiciary strikes down other provisions of the act. I suggest to you it might be quite the opposite." Overturning the mandate alone, he continued, "can be argued at least to be a more extreme exercise of judicial power than to strike the whole."

This is a critical point.

I think it is clear the 4 justices traditionally identified with the liberal side of the court are fore-square for the law and will find some way to justify it’s egregious and unconstitutional over-reach.  And yes, no secret, I’ve always considered the law to be that and nothing I’ve heard in oral arguments has changed that.  I think Justices Thomas, Alito and Scalia are for finding the mandate unconstitutional and for killing the entire law.  I think Chief Justice Roberts is against the mandate although I’m not sure it’s a foregone conclusion that he wants to kill the entire law at this point.   However I think he’ll be persuaded eventually.

That would make Kennedy the guy … again.   No surprise for most who’ve watched the court for the past few sessions.  He often ends up as the swing guy.  You may disagree with my assessment of where he is in his decision making process, but his questions and comments, at least to me, seemed to indicate he was forming a particular opinion and that opinion favored both striking down the mandate and then striking down the whole law.

Should that be the case, and given the Democrats are unlikely to have an unassailable majority in Congress anytime soon as they did when they passed this monstrosity, this is indeed “the most important case in 50 years”.   That’s a “good thing” because the likelihood that a “replacement” will be passed in Congress becomes much less likely.   Kennedy’s vote could save America as we know it and protect us from a law that would “fundamentally” change our relationship with government and place us in a position of involuntary servitude to a government given license to run our lives in pretty much any way it see’s fit to pursue.

Here’s hoping.

~McQ

Twitter: @McQandO


Obama budget goes 0-414 in House

So let’s see, the two votes I’ve seen on the two Obama budgets that at least one of the houses of Congress has voted on in the past two year, neither has garnered a single vote from any legislator regardless of party.

Yesterday the House voted unanimously against President Obama’s current budget.  Last year the Senate went 0 for and 97 against his previous budget.

The House Democrats claim to have their own budget which closely mirrors the Obama budget deficits but differs in the details.

Oh good.

Meanwhile:

Senate Democrats have said they will not bring a budget to the floor this year, though Republicans in the chamber have talked about trying to at least force a vote on Mr. Obama’s plan there as well.

Thank you Harry Reid for your strong fiscal leadership.  What is it?  Well over 1,000 days and Senate Democrats have yet to produce a budget.

My guess is it’s Bush’s fault.

~McQ

Twitter: @McQandO


New UN IPCC report drops AGW as the cause of climate change

Roger Pielke Jr notes that the new IPCC report covering climate change seems to take the skeptical argument to heart and stick much more closely to actual facts and what is really known  empirically.  Says Pielke:

The full IPCC Special Report on Extremes is out today, and I have just gone through the sections in Chapter 4 that deal with disasters and climate change. Kudos to the IPCC — they have gotten the issue just about right, where "right" means that the report accurately reflects the academic literature on this topic. Over time good science will win out over the rest — sometimes it just takes a little while.

His examples from the report:

A few quotable quotes from the report (from Chapter 4):

-"There is medium evidence and high agreement that long-term trends in normalized losses have not been attributed to natural or anthropogenic climate change"

-"The statement about the absence of trends in impacts attributable to natural or anthropogenic climate change holds for tropical and extratropical storms and tornados"

-"The absence of an attributable climate change signal in losses also holds for flood losses"

The report even takes care of tying up a loose end that has allowed some commentators to avoid the scientific literature:

-"Some authors suggest that a (natural or anthropogenic) climate change signal can be found in the records of disaster losses (e.g., Mills, 2005; Höppe and Grimm, 2009), but their work is in the nature of reviews and commentary rather than empirical research.

Maybe he’s right.  Maybe, finally, science will “win out”.  And I also hope that the administration that has said it will use science in its policy making process will now actually do so. 

Hello, EPA?

~McQ

Twitter: @McQandO