Free Markets, Free People
This week, Bruce, Michael and Dale discuss the events of the week.
The direct link to the podcast can be found here.
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A little delusion on a grand and dangerous scale:
The government, political parties and organizations of the DPRK solemnly declare as follows reflecting the final decision made by Kim Jong Un at the operation meeting of the KPA Supreme Command and the unanimous will of all service personnel and people of the DPRK who are waiting for a final order from him.
1.From this moment, the north-south relations will be put at the state of war and all the issues arousing between the north and the south will be dealt with according to the wartime regulations.
The state of neither peace nor war has ended on the Korean Peninsula.
Now that the revolutionary armed forces of the DPRK have entered into an actual military action, the inter-Korean relations have naturally entered the state of war. Accordingly, the DPRK will immediately punish any slightest provocation hurting its dignity and sovereignty with resolute and merciless physical actions without any prior notice.
You can read the whole thing here. Apparently Marshall Poppin Fresh, aka Kim Jong Un, is a little full of himself and feeling froggy. The mouse has roared. Unfortunately, this mouse had a nuke or two and is threatening to use them. Whether they’ll work or whether he can actually deliver them remain to be seen (and hopefully he’s just as delusional about that as he is actually going to war).
Another in a long line of attempts to use Nork threats to extort money from the West, or is this little fool serious?
Here are today’s statistics on the state of the economy:
Personal income rose 1.1% in February, while personal spending rose 0.7%. The PCE Price Index, an inflation measure, rose 0.4% at the headline level, and 0.1% at the core. On a year-over-year basis, personal income is up 2.6%, while spending is up 3.3%. The PCE Price Index is up 1.3%.
The Reuter’s/University of Michigan’s consumer sentiment index erased last month’s decline, rising to a strong 78.6 in March.
Over at RedState, Erick Erickson promoted a post in favor of legalizing same-sex marriage by “mjdaniels,” a Christian conservative and long-time lurker there. It’s a long post that makes a number of good points, but he ultimately makes a number of rhetorical errors that give his fellow Christian conservatives an easy way out, and they did fix on those errors. So it is that the people I see praising his argumentation with the fewest reservations are mostly not currently practicing Christians or self-identified conservatives.
Among those errors, the biggest was probably when he said, “Is Homosexuality a Sin? I. Do. Not. Care.” Christians are supposed to care whether others sin. The proper question is the duty others have to sinners. And behold all the RedState regular commenters saying that they’re called to rebuke sin and lead sinners away from sin, out of love. Many deny that enshrining these rebukes in legal exclusivity is tantamount to “hunting down sinful people,” and they claim that it isn’t them but same-sex marriage activists who are trying to “wield the power of the government to enforce my convictions on others.”
I’d sorely like to see how his fellow Christian conservatives would respond if they couldn’t focus on those errors. In particular, I wished “mjdaniels” had better focused on something he only said in passing at the end of his post: that opponents of same-sex marriage were essentially calling for “casting the first stone at” this set of sinners.
It seems to me that when persuading Christian conservatives, one should be absolutely clear that the status quo is coercion – discriminatory taxes and inheritance rules, and denying the right to contract, all of which conservatives agree is state coercion when it’s applied to them – and that when Jesus was challenged to support such coercion (stoning a woman caught in the act of adultery, according to Mosaic Law), he in turn challenged the teachers of law and Pharisees that the first stone should be cast by one who is without sin. When no one would stone her, he said he would not condemn her that way either, and he simply told her to leave her life of sin.
If even Jesus doesn’t think it’s humans’ place to punish violations of one of the Ten Commandments dealing with marriage, then it’s an uphill climb for a Christian conservative to argue that it’s their duty to uphold the use of such force based on moral strictures that are much less clear.
I find it baffling that conservatives think the government is capable of making a compact sacred by calling it a marriage, but there I see it in the RedState comments. Do they teach their children that the state’s refraining from coercion is an indication of societal approval of a behavior? No; what is not prohibited is merely left to be governed by the other aspects of civil society (the family, the market, churches, social pressure, etc.) and, if Christians are correct, God’s ultimate judgment.
Does a duck quack? Of course they were. Were politicians pushing an agenda involved? That’s a rhetorical question:
And yes, we told you so.
As Thomas Sowell pointed out, and I’m paraphrasing, how anyone thought that adding a layer of bureaucracy and regulation to the current system was going to drive costs down was beyond him.
And it was beyond most people who have even a modicum of common sense.
Medical claims costs — the biggest driver of health insurance premiums — will jump an average 32 percent for Americans’ individual policies under President Obama’s overhaul, according to a study by the nation’s leading group of financial risk analysts.
The report could turn into a big headache for the Obama administration at a time when many parts of the country remain skeptical about the Affordable Care Act. The estimates were recently released by the Society of Actuaries to its members.
While some states will see medical claims costs per person decline, the report concluded the overwhelming majority will see double-digit increases in their individual health insurance markets, where people purchase coverage directly from insurers.
The disparities are striking. By 2017, the estimated increase would be 62 percent for California, about 80 percent for Ohio, more than 20 percent for Florida and 67 percent for Maryland. Much of the reason for the higher claims costs is that sicker people are expected to join the pool, the report said.
Well done, Democrats — well done.
Here are today’s statistics on the state of the economy:
The final GDP estimate for 4th Quarter of 2012 came in at 0.4% annualized. The GDP price index, an inflation measure, rose 1.0%.
Initial jobless claims rose 16,000 to 357,000 last week. The 4-week average rose 3,250 to 343,000. Continuing claims fell 27,000 to 3.050 million, a recovery low.
The Chicago Purchasing Managers Index unexpectedly fell to 52.4 in March from 56.8.
Corporate profits in the 4th Quarter of 2012 rose 7.5% to $1.774 trillion annualized, up from $1.742 trillion in the third quarter.
The Bloomberg Consumer Comfort Index fell -1.5 points to -34.4 in the latest week.
The Kansas City Fed Manufacturing Index rose 5 points to -5 in March.
Despite the attempt by government and particularly Democrats, to blame the financial meltdown we’ve endured on banks and unscrupulous investment companies, the buck stops with them according to a new study just released:
Democrats and the media insist the Community Reinvestment Act, the anti-redlining law beefed up by President Clinton, had nothing to do with the subprime mortgage crisis and recession.
But a new study by the respected National Bureau of Economic Research finds, “Yes, it did. We find that adherence to that act led to riskier lending by banks.”
Added NBER: “There is a clear pattern of increased defaults for loans made by these banks in quarters around the (CRA) exam. Moreover, the effects are larger for loans made within CRA tracts,” or predominantly low-income and minority areas.
As we’ve mentioned previously any number of times, government policies can set and enforce preverse incentives. And that has nothing to do with a free market. That’s at best a mixed market. So no, the problem wasn’t a “market failure”, it was the usual result of government intruding and setting preverse incentives that are contrary to good business practices and would likely not survive or succeed in an actual free market.
Here’d the bottom line:
The strongest link between CRA lending and defaults took place in the runup to the crisis — 2004 to 2006 — when banks rapidly sold CRA mortgages for securitization by Fannie Mae and Freddie Mac and Wall Street.
CRA regulations are at the core of Fannie’s and Freddie’s so-called affordable housing mission. In the early 1990s, a Democrat Congress gave HUD the authority to set and enforce (through fines) CRA-grade loan quotas at Fannie and Freddie.
It passed a law requiring the government-backed agencies to “assist insured depository institutions to meet their obligations under the (CRA).” The goal was to help banks meet lending quotas by buying their CRA loans.
But they had to loosen underwriting standards to do it. And that’s what they did.
Not only that, they guaranteed the bad loans with your money. Why do you think so much money has had to be pumped into those two institutions?
You see the market had determined that certain standards protected their investments. The government decided to ignore reality and push a social agenda using “race” as the basis for throwing out those standards and using their coercive power to implement the social agenda they preferred.
The result was predictable.
And the coverup as well.
For those of you who like cars and motoring, I have some new content up on Medium:
If you like these articles, please be sure to recommend them. My entire automotive collection is available here, and more will be coming.