Free Markets, Free People

Politics

Closing Dealerships Via Barack-Foolery?

I watched this story percolate throughout the day, wondering if there was anything of substance to it. Even now I’m not entirely sure how much is pure speculation and how much can be decisively proven. If any of it turns out to be true, however, then the repercussions could prove politically fatal. Doug Ross has the scoop:

A tipster alerted me to an interesting assertion. A cursory review by that person showed that many of the Chrysler dealers on the closing list were heavy Republican donors.

To quickly review the situation, I took all dealer owners whose names appeared more than once in the list. And, of those who contributed to political campaigns, every single one had donated almost exclusively to GOP candidates. While this isn’t an exhaustive review, it does have some ominous implications if it can be verified.

However, I also found additional research online at Scribd (author unknown), which also appears to point to a highly partisan decision-making process.

[...]

I have thus far found only a single Obama donor (and a minor one at that: $200 from Jeffrey Hunter of Waco, Texas) on the closing list.

Chrysler claimed that its formula for determining whether a dealership should close or not included “sales volume, customer service scores, local market share and average household income in the immediate area.”

In fact, there may have been other criteria involved: politics may have played a part. If this data can be validated, it would appear to be further proof that the Obama administration is willing to step over any line to advance its agenda.

Doug notes some anecdotal evidence to back up his theory, and reading through the various personal accounts from dealerships who claim to be successful, and yet who are being shut down, lends some credibility to the idea. As does the fact that the closing list is reportedly populated almost exclusively with Republican donors and/or those who gave money to Obama’s Democratic rivals. But the real test is in a comparison of the lists of dealerships staying open and those that are closing against a campaign donor database (which I haven’t done, but feel free to scrutinize them for yourself).

Nevertheless, the following bit of research from Red State strikes an ominous chord:

Eric Dondero recognizes some of the dealers’ names on the hit list:

“Vern Buchanan is a Republican Congressman from the Tampa Bay area. Robert Archer is the son of former Republican Congressman Bill Archer. John Culberson, a libertarian-leaning Conservative, is now the Congressman for that West Houston District. He was heavily supported in his election efforts by the Archers Family.”

“Additionally, James Crowley, owner of a Chrysler Dealership in Escondido, California is on the list to be closed. Crowley is a big backer of libertarian-leaning Republican Cong. John Campbell of Orange County.”

The list is heavy with influential Republicans and libertarians. Another name on the list is Ray Huffines, who owns a large dealerhsip in the Metro-Dallas/Ft. Worth area. The Huffines family have been major contributors to Rep. Ron Paul (R-TX) over the years.

It’s hard to know what to make of all this, but at first blush it certainly looks like the decisions to close dealerships may have been influenced by the political affiliations of the dealers. Under regular circumstances that would elicit a big shrug, but when Chrysler’s decisions are basically being made for them, well, that’s a whole ‘nother kettle of fish (via Reliapundit):

A lawyer for Chrysler dealers facing closure as part of the automaker’s bankruptcy reorganization said on Tuesday he believes Chrysler executives do not support a plan to eliminate a quarter of its retail outlets.

Lawyer Leonard Bellavia, of Bellavia Gentile & Associates, who represents some of the terminated dealers, said he deposed Chrysler President Jim Press on Tuesday and came away with the impression that Press did not support the plan.

“It became clear to us that Chrysler does not see the wisdom of terminating 25 percent of its dealers,” Bellavia said. “It really wasn’t Chrysler’s decision. They are under enormous pressure from the President’s automotive task force.”

Given the other sorts of thuggery that have been alleged in these Chrysler proceedings, this should come as no shock. But the fact that these closings will have to be approved by the creditors in the bankruptcy case lends a certain bit of intrigue to this case and raises a lot questions in my mind.

Assuming that the closings are motivated by political payback from Obama, how will that plan affect the stakeholders in the new company? If there really are profitable dealerships being shutdown just because they gave money to the wrong candidates, then it stands to reason that the remaining dealers will be something less than the cream of the crop, and therefore the new Chrysler will have a less than optimal distribution chain for its products. It’s not entirely clear why shutting down dealerships helps Chrysler anyway, since they are essentially the real customers of the carmaker, but it seems to me that those who plan to profit from the new venture would have something to say about the plan in the bankruptcy case. Presumably, they will want to protect their investment by challenging any plan for closings that does not maximize their return. If and when they do, it could get very interesting for Obama (again, assuming that any of this is true).

It should be noted that until some further confirmation surfaces, this story should be treated with a healthy dose of skepticism. Indeed, if it weren’t for the rather dictatorial way the Obama administration has dealt with the entire automaker bailout fiasco, these allegations of political payback would ring pretty hollow. Yet, considering the past bullying, the story definitely merits further consideration, so keep your eyes and ears open for more.

Sotomayor Nominated to SCOTUS

As a surprise to almost no one, Obama went with the candidate who fills the most quotas for his first Supreme Court pick. Since I’ve already covered what sort of Justice I think she’d be, I’ll just note that I think Obama picked the least qualified and most political of the three top contenders (Kagan and Wood being the others). Other than that, I don’t think her nomination will make much difference in the grand scheme of things.

Ilya Somin arrives at basically the same conclusion, and along the way takes special exception a particular statement from Sotomayor (my emphasis):

I am not yet sure what position to take on President Obama’s selection of Sonia Sotomayor. My general sense is that she is very liberal, and thus likely to take what I consider to be mistaken positions on many major constitutional law issues. I am also not favorably impressed with her notorious statement that “a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn’t lived that life.” Not only is it objectionable in and of itself, it also suggests that Sotomayor is a committed believer in the identity politics school of left-wing thought. Worse, it implies that she believes that it is legitimate for judges to base decisions in part on their ethnic or racial origins.

Expect to see that quote get much airtime as Republicans seek some ground from which to undermine Sotomayor’s nomination.

As for whether or not the Republicans should go to the mat on this, it seems to me like a bad idea. I think there are certainly some troubling aspects to Sotomator’s candidacy (such as her quote above), but there is also almost zero possibility that she will not be confirmed. With 59 Democrats in the Senate, there is also little hope of fillibustering the nomination. Accordingly, if Republicans choose this particular hill to die upon, they spend political capital for no gain, and risk losing the ability to generate opposition to any subsequent nominees who may have more substantive influence on the direction of the Court (e.g. a replacement for Kennedy or Scalia).

Since it appears that taking on Sotomayor’s nomination is rife with bad consequences for the GOP, I think it is a very safe bet that they will pull out all the stops in order to oppose her. This will prove once again that, sometimes, it takes great effort to earn minority party status. In that endeavor, expect the Republicans to leave no stone unturned.

Stray Voltage

A very interesting piece in the LA Times about some European muslims who failed at the job of “holy warrior – or did they?


Pakistan is discovering that their unwelcome guests in the Swat Valley are harder to get rid of than cockroaches.


Apparently Rep. Collin Peterson (Minn.), the outspoken Democratic chairman of the Agriculture panel, isn’t happy with the Waxman/Markey Cap-and-Trade bill and is promising trouble.


It seems even the NY Times is catching on to the Obama rhetorical devices.  Helene Cooper points out that some of Obama’s “enemies” are “straw men” and Sheryl Gay Stolberg notes that many of Obama’s “nuanced” positions would be flip-flops if it was anyone else.  Of course both articles were published in the Saturday NY Times, so its not like they’re really calling Obama to task.


The Washington Post, examining Venezuela strong man Hugo Chavez’s latest attempt to destroy any domestic opposition, wonders if the Obama administration’s silence on the matter constitutes sanction by silence.  Well if that’s the case, what does Nancy Peolsi’s silence about the use of waterboarding constitute?


A porn star is considering a run for the US Senate from Louisiana.  Given the fact  that she’s only worked in a different type of porn than what goes on in the US Senate, she ought to fit right in.


The NY “bomb plot” has apparently degenerated into an “aspirational” one.


And finally, it looks like Brits are finally fed up.  According to reports, a big “vote the bums out” movement is taking shape in the UK.  We should be so lucky.

Right Policies: Opting Out

Yesterday Jon Henke challenged the Right to come up with policies that are popular, viable, workable, transformational and sustainable. (Follow the link to see what he means by each of those.) I’ve previously suggested a broad-based agenda that I thought could be sold as an alternative to the Democrats’ agenda, but I think a few of the specific policies are particularly strong, and they stick to a consistent theme.

Libertarian paternalism — which means that certain initial decisions are made for you, but you are left a way to opt out — can be a good or a bad thing, depending on the status quo. If the status quo is freedom, I’d just as soon not add in an element of paternalism in virtually any case. But if the status quo is paternalism, then libertarian paternalism is a step in the right direction.  Fortunately, giving people more options is much more popular than changing their status quo decision.

I propose that the Right should target existing paternalism and offer as many opportunities to opt out as we can devise. My main two examples are education and entitlements.

Education

I consider education to be any political coalition’s #1 long-term priority. If your opponents control education, chances are you will eventually lose on everything else. So, what policies should the Right pursue on education?

Vouchers aren’t a new idea, but we on the Right could be pursuing them in much more creative ways than we are now, to build a broad working alternative to state schools.  With variable-cost vouchers and pilot programs that target the “victim classes”, the Right can play full court press on vouchers in every school district.

Variable-Cost Vouchers

In every school district across the country, we should have vouchers at least equal to the variable cost of sending one extra child to public school. Democrats have argued for a long time that we need more spending per student to give kids smaller class sizes and better materials such as textbooks, and have used that to justify countless bond measures and tax increases to increase public school funding.

If a voucher just covers the variable cost of an extra student, then a voucher helps create smaller class sizes and increases the amount of money the public school can spend on each student.

You can see how a voucher for variable costs puts the Left in a Catch-22: Every extra dollar they want to spend per student is an argument for a bigger voucher, and an opportunity for the private sector to spend the dollar more efficiently than the public sector.

Make Friends in Low Places

We can do even better: pilot voucher programs should very openly target kids who are performing worst in the current system, in part because proposing vouchers for them undercuts the argument that vouchers just skim the cream of the crop.

Voucher proponents have already focused on several low-income and minority populations, using needs-based criteria and simple geography; the Right should be pushing this smart strategy much more aggressively – it undercuts Democrats’ arguments against vouchers beautifully, and makes a direct play for the Left’s base. The apparent success of the DC voucher system has made attempts to cut the program very embarrassing for Democrats; we need more of that.

Moreover, the Right should propose vouchers that help children who score on the bottom half of the test-score distribution. The research I’ve read indicates that these children show the greatest gains from voucher programs.  For the same reason, target kids with histories of disciplinary problems and special-needs children (paging Sarah Palin).

It would be a bridge too far for the Democrats to argue that these kids enhance the performance of public schools after using the opposite argument to fight vouchers for so long.

And finally, the Right should propose voucher programs to target the many minors who have already dropped out of school.  Kids who have outright given up on the public school system, or who rarely show up, aren’t doing anything to improve the performance of those schools.  If Democrats want to keep up the pretense that they care about these kids, they shouldn’t have any problem with helping these kids become part of a new private education market.

Those are just a small number of ways we can turn the Left’s most popular arguments against them and start to build a real market in education. In the meantime, the Right would be demonstrating that markets can work better than state-administered programs, and help the “little guy” who’s been screwed by the public system.

Where necessary to make the policy viable, the Right could be flexible on the matter of vouchers for church-founded schools (like Catholic schools); the first priority is building a broad education market outside of the state.

Entitlements

Here’s another place where reform would be truly transformational. The Right should push for an opt-out for the major entitlements – Medicare and Social Security. A reform doesn’t have to be a full privatization to accomplish a great deal of good.

Many people are currently collecting benefits from Medicare and SocSec, and we can assume that they will turn out to vote against anything that takes away those benefits. The Right can start making progress on reducing our crushing long-term obligations by (once more for effect) giving everyone as many opportunities to opt out as possible.

Social Security

Why not allow people to adjust their expected benefits, with higher or lower individual taxes to compensate for the change from the “standard” level?  The SSA could set a minimum level of contributions to guarantee its promised benefits, so that the legislation becomes non-threatening to beneficiaries, and thus politically viable.  To get the greatest tax cut, you opt out of all retirement benefits; you can change your mind later, but your benefit and/or tax level must be adjusted appropriately.  And the more people who opt out, the lower the minimum tax rate can go; that rate could be adjusted at periodic intervals, perhaps once a year.

Similarly, why not allow people to adjust their expected retirement age, again paying higher or lower taxes to compensate?

Both of these adjustments would introduce flexibility along with a price mechanism.

Yes, this means that some people might choose to pay the minimum tax and find themselves at age 67 regretting their earlier decisions, but everyone would know that they made a conscious choice to change from the status quo.  And in the meantime, those who opt out don’t feel like such direct stakeholders.

Medicare and other state medical benefits

To get more people off the rolls, allow them to opt out of Medicare eligibility and other state medical benefits in exchange for some mix of:

    • lower payroll taxes
    • tax-free health savings accounts
    • a tax cut on their individual health insurance
    • vouchers for private insurance and private disability coverage

… as long as the total cost of the mix is lower than the expected cost of Medicare benefits.  This way, the Right can not only cut into the massive expected costs on the near horizon, but also get fewer people to feel like stakeholders in the future of the state-administered system.

Conclusion

The most effective arguments against reform are allegations that people will lose the benefits they have now. Psychologically, we regret losing a dollar more than we regret not acquiring that dollar in the first place. That’s a big part of how the Right beat universal health care under Clinton: by telling the American people that they would lose their current insurance, with which most of them were satisfied.

Whether we like it or not, it is stupid to do a frontal assault on a hardened position. Instead, we should apply libertarian paternalism to divide and conquer by giving our opponents as many chances to defect as possible.

Sometimes It Is Better To Be Thought A Fool Than To Open Your Mouth And Remove All Doubt

Apparently Al Gore, not content with the environmental dissembling and misrepresentations he’s been peddling for the past few years, has decided to expand his mendacious horizons. He’s decided to lecture Dick Cheney on when it is appropriate to criticize the current administration.

“I waited two years after I left office to make statements that were critical,” Gore said during an interview on CNN, pointing out that his critiques were focused on “policy.”

As usual, he’s wrong on both counts (you’d think these boobs would check things before they blurt them out). From a September 2002 speech:

AL GORE: Vice President Cheney said after the war against terrorism began, “This war may last for the rest of our lives.” I kind of think I know what he meant by that, but the apprehensions in the world that I spoke of earlier are not calmed down any by this doctrine of preemption that they are now asserting. By now the Bush Administration may now be beginning realizing that national and international cohesion are indeed strategic assets. But it is a lesson long delayed and clearly not uniformly and consistently accepted by senior members of the cabinet. From the outset, the administration has operated in a manner calculated to please the portion of its base that occupies the far right, at the expense of solidarity among all of us as Americans and solidarity between our country and our allies. On the domestic front, the administration, having delayed for many months before conceding the need to pass Joe Lieberman’s bill and create an institution outside the White House to manage homeland defense, has actually been willing to see this legislation held up for the sake of an effort to coerce the Congress into stripping civil service protections from tens of thousands of federal employees. Now which is more important: passing the Homeland Security Act, or satisfying a relatively small yet powerful member of the right-wing coalition that has as its number-one priority dismantling labor unions? If that’s the most important priority in that legislation, that explains why they’re refusing to let the bipartisan consensus in favor of it go forward.

Far more damaging is the administration’s attack on fundamental constitutional rights that we ought to have and do have as American citizens. The very idea that an American citizen can be imprisoned without recourse to judicial process or remedies, and that this can be done on the sole say-so of the president of the United States or those acting in his name, is beyond the pale and un-American and it ought to be stopped.

September 2002 is not “2 years” from inauguration and the highlighted passages are not “policy” critiques. And if that one transcript isn’t enough, check these out. Most are earlier than the above speech excerpt.

~McQ

Nanny Wants New Credit Card Rules

Why not just wrap us all up in bubble wrap and bottle feed us?

“We like credit cards — they are valuable vehicles for many people,” said Senator Christopher J. Dodd, Democrat of Connecticut, the chairman of the Senate banking committee and author of the measure now being considered by the Senate. “It’s when these vehicles are being abused by the card issuers at the expense of the consumers that we must step in and change the rules.”

Doug Bandow provides the proper pithy reply to Sen. Dodd:

“Abused by the card issuers.” Of course. The very same card issuers who kidnapped people, forced consumers to apply for cards at gunpoint, and convinced merchants to refuse to accept checks or cash in order to force everyone to pull out “plastic.” The poor helpless consumers who had nothing to do with the fact that they wandered amidst America’s cathedrals of consumption buying wiz-bang electronic goods, furniture, CDs, clothes, and more. The stuff just magically showed up in their homes, with a charge being entered against them against their will. It’s all the card issuers’ fault!

Certainly card issuers are raising their rates arbitrarily to very high rates. And, as I did recently, card holders are calling them up and very politely saying “stuff it – and while you’re at it do it with my canceled card”.

Credit cards aren’t a ‘right’, and the fact that someone gets themselves into trouble with them doesn’t make them a ‘victim’ deserving of special legislation to “right a wrong”.

What in the world ever happened to individual responsibility and accepting the consequences for your actions?

~McQ

“Suddenly”, Social Security Is In Trouble

Turbo Tax Tim Geithner tells us:

Social Security’s annual surpluses of tax income over expenditures are expected to fall sharply this year and to stay about constant in 2010 because of the economic recession, and to rise only briefly before declining and turning to cash flow deficits beginning in 2016 that grow as the baby boom generation retires.

Of course what Geithner and the Democrats want you to believe is this sudden problem with both Social Security and Medicare has been brought on by the recession and, of course, that means it’s Bush’s fault.

But I took the opportunity to hit the QandO archives and found a couple of interesting live blogs Dale did. The first was the State of the Union address from February 3, 2005.

Thirteen years from now, in 2018, social Security will be paying out more than it takes in. And every year, the annual shortfall will get larger…By 2042 the system will be bankrupt.

That line, of course, was met by Democratic jeers.

A couple of months later at one of his rare news conferences, Bush again emphasized the point and adjusted the dates. As Dale live blogged it:

—Social Security will start spending more than it take in 2013. By 2040, it’ll be bankrupt. Like, you know, it’s not bankrupt now, really.

Again, that was met by Democratic jeers. That’s because Bush mentioned private accounts. Incredibly, much to the horror of many on the right, he also mentioned means testing. But still, the Dems were more interested in blowing off the impending crisis as fiction than addressing it.

The same story was told the next year with the same results.

Our boy Harry Reid in May of ’06:

In a statement released Monday, Senate Minority Leader Harry Reid (D-Nev.) said the trustees’ report “confirms that, despite White House scare tactics, Social Security remains sound for decades to come.”

According to Reid, “The real threat to Social Security comes from Republicans, most of whom support and voted for privatizing Social Security.”

As it turns out Medicare/Medicaid is in much worse shape than Social Security, and deserves some discussion as well – but the Social Security question is instructive. This isn’t some ‘sudden’ problem brought on by the recession. This is one that was identified years ago and ignored by the very same people who are now trying to lay blame elsewhere. Just something to remember when they stand in front of the microphones, look directly into the cameras and lie through their teeth.

~McQ

Rising Thugocracy?

First we have the “car czar” threatening investors with audits and vilification, and now we have a report that a union was inappropriately involved in matters in which it should not have been included:

Officials in the governor’s office say a politically powerful union may have had inappropriate influence over the Obama administration’s decision to withhold billions of dollars in federal stimulus money from California if the state does not reverse a scheduled wage cut for the labor group’s workers.

The officials say they are particularly troubled that the Service Employees International Union, which lobbied the federal government to step in, was included in a conference call in which state and federal officials reviewed the wage cut and the terms of the stimulus package.

The SEIU is of the opinion the state is “breaking the law” as it concerns the use of “stimulus” funds. The state sees it otherwise. But that doesn’t explain the inclusion of the union on the call. Said state officials:

During the conference call, state officials say, they were asked to defend the $74-million cut scheduled to take effect July 1. The cut lowers the state’s maximum contribution to home health workers’ pay from $12.10 per hour to $10.10.

The California officials on the call, who requested anonymity for fear of antagonizing the Obama administration, said they needed the savings to help balance the state budget.

Most know that California is a budgetary basket case, but they should also know that SEIU members are the one’s effected by the cut. The phrase which is most chilling in the last cite is that which indicates a fear of “antagonizing the Obama administration” among state workers.

Is that really the atmosphere that should exist between the states and the feds? And, given their inclusion in the call, isn’t it fair to claim that the SEIU has had “undue” influence with the administration?

So how is this different than the alleged inappropriate lobbyist influence the left liked to holler about during the Bush years?

~McQ

This Is “Rich”

I‘m still amazed that many people who put their support behind Obama in the presidential election, are suddenly discovering things about him they don’t like.

Really? Now they discover Obama is a class warrior? It comes as no surprise for those of us who took the time to assess where he came from and what (little) he’d done.

Suddenly, the rich are concerned that the guy they backed may not be what they hoped he was (notice that’s the correct context in which “hope” should be used when “hope and change” is spoken):

Some of Barack Obama’s richest supporters fear they have elected a “class warrior” to the White House, who will turn America’s freewheeling capitalism into a more regulated European system

Ya think? What was your first clue – his remarks about “spreading the wealth” to Joe the Plumber or the thousands of other things he said which might imply such a tendency?

And as an aside, America’s capitalism is about as “freewheeling” as a modern waterslide is “death defying”.

Chris Edwards of the Cato Institute, a free enterprise think tank, said Democrats in Congress were unnerved by the president’s latest plan to raise $210 billion over 10 years from multinational corporations.

The money is needed to pay for a national debt that will double over the next five years; and triple over the next 10 years to $17.3 trillion. But the crackdown already faces fierce Democratic resistance.

“These big companies are based in New York Boston, Seattle and Silicon Valley, where Democrats dominate,” Mr Edwards said. “Obama’s tax plan is already cleaving him from his big corporate supporters,” he said.

The good news in this, of course, is that Congress has to pass the legislation that enables this, and per Edwards, they’re getting cold feet. The reason is also obvious – any “cleaving” of Obama from “big corporate sponsors” also means the rest of the Democrats suffer the same fate.

The level of taxation necessary to pay for the profligate spending now taking place will have to be massive as anyone with a 5th grade education understands. But the Dems also understand that any taxation that takes place must be other than income taxes because it is important to maintain the mirage that “95% of all Americans” are getting tax cuts. That leaves “the rich”, corporations and smoke and mirrors.

The rich have been identified ($250k or more), corporations are on the block with much higher taxation in the offing. So the investor class and the engine of the economy are under assault. The smoke and mirrors show? Wait until health care and cap and tax trade hit. 100% of Americans will be paying large sums for both.

But back to the point – the deeper we get into the Obama administration, the more we come to understand how gullible a good portion of the American public appears to be. There is a certain level of satisfaction with the buyer’s remorse being seen among many of his supporters as they see what their vote has actually bought. I sure hope they don’t shop for other important items as badly as they apparently shop for presidents.

~McQ

Specter – Sometimes You Get What You Pay For

Personally I find this mighty funny. Arlen Specter on Meet the Press with David Gregory:

Gregory: It was reported this week that when you met with the President, you said, “I will be a loyal Democrat; I support your agenda.” Let me test that on probably one of the most important areas of his agenda and that’s healthcare. Would you support healthcare reform that puts up a government-run public plan to compete with a private plan issued by a private insurance company.

Specter: No. And you misquote me, David. I did not say I would be a loyal Democrat. I did not say that. And last week, after I said I was changing parties, I voted against the budget because the budget has a way to pass healthcare with 51 votes,which undermines a basic Senate institution to require 60 votes to impose cloture on key issues.

You know, I’ve seen some pathetic politicians in my time, but there are few that rival Arlen Specter. My guess is he ends up in a Democratic primary and looses that. From RINO to DINO, it’s clear that the only thing Arlen Specter stands for is Arlen Specter. Personally I think the Republicans should send the Democrats a thank you card for taking him off their hands.

~McQ