Free Markets, Free People

Monthly Archives: July 2010


Dale’s Observations For 2010-07-26

RT @dmataconis: ObamaCare Doesn’t Justify Secession http://bit.ly/afyqNx | Given the tone of that article, one wonders what would. #

RT @dmataconis: Re: Political Discourse? http://bit.ly/9IdNtR | Was the 'net causing riots, demonstrations, and domestic terrorism in '68? #

RT @MelissaTweets @La_Shawn: Re: Oliver Stone, Hitler: http://bit.ly/bpEtfG | How do these people even pretend to moral seriousness? #

RT @MelissaTweets @La_Shawn: Re: Oliver Stone, Hitler: http://bit.ly/bpEtfG | If only we knew more about the CONTEXT of Nazism. And Stalin. #

RT @ewerickson: The reviews at Amazon.com for uranium are priceless. http://is.gd/dK2ce | Those reviews are hilarious. #

Geithner defends allowing the Bush tax cuts to expire. This is the same policy mix that extended the Great Depression. http://bit.ly/aM346a #

New home sales increased 23.6% to an annual rate of 330,000..
the second lowest on record since 1963. http://bit.ly/aFuuUe #RecoverySummer #


Talking the deficit talk, but – as usual – not walking the walk

Democrats and President Obama have been talking the talk about deficit reduction – yesirree. Why to hear them talk about what has to be done, you’d think they were the second coming of the Republican caucus.

But when it comes to walking the walk? Not so much:

A new White House forecast predicts that the federal budget deficit, which hit a record $1.4 trillion last year, will exceed that figure this year and again in 2011.

The $1.47 trillion budget gap predicted for 2010 — when 41 cents of every dollar spent by the federal government would be borrowed — represents a slight improvement over the administration’s February forecast. The estimated gap for next year, $1.42 trillion, is larger than what was predicted in February, primarily because of a drop in expected tax receipts from capital gains.

So here the government is in one of the biggest fiscal holes it has ever dug for itself, and the answer the Democrats come up with is “let’s dig it deeper and call it ‘fighting the deficit’”.

How else do you explain budgets like the one offered by the Obama administration and especially in light of Tim Geithner’s pronouncement yesterday (see below) that it was time for the private sector to start investing?   Forty one cents of every dollar spent under this budget from President Obama will be borrowed.

Of course, Obama has told us that the goal is to balance the federal budget by 2015.  That’s what he’s said – and for what its worth, that’s certainly a worthy goal.  But you have to do more than try to talk it down.   The action taken have to reflect that goal.  And this budget doesn’t.   Nor, really, do his future ones.

The Committee for a Responsible Federal Budget reviewed this year’s presidential budget proposal and the deficit reduction plan and this may come as a surprise to you, but it is all smoke and mirrors.

The budget proposes $3.8 trillion in spending and receipts of $2.6 trillion, resulting in a deficit of $1.3 trillion – or 8.3 percent of GDP. This is higher than the 7.4 percent deficit projected from the Administration’s proposals in its August Mid-Session Review (MSR) and significantly higher than the 6.0 percent deficit projected under their “current law” (BEA) baseline. It is a decrease from the 9.9 percent deficit in FY 2009, and the projected 10.6 percent deficit in FY 2010.

Over the ten year window from 2011 through 2020, deficits are estimated to total $8.5 trillion – or 4.5 percent of GDP. This is significantly higher the $5.5 trillion (2.8 percent of GDP) deficit projected under “current law” which assumes expiring policies would end as planned.

Or under the “current law”, deficit stays at 6% of GDP (still too much) but under the “deficit reduction/balanced budget” plan of the administration, it balloons up to 8.3% GDP (way freakin’ too much).

So we’re being sold a load of unicorns with this totally misleading nonsense being spouted by Obama and Democrats.  Their budgets do only one thing for deficits (and the debt) – they add to them.   And, if followed, by 2020, here is what the debt will be:

Under OMB’s new estimate of the President’s budget, the debt held by the public would grow continuously as a share of the economy, passing 60 percent this year, 70 percent in 2012, and 77 percent in 2020.

Now someone, anyone – tell me how this plan of theirs reduces the important number in all of this – the debt?  Obviously it doesn’t.  They’re talking about spending less borrowed money than they have previously, that’s all.  And when you are spending trillions in deficits, dropping it down to 900 billion in deficit spending is “deficit reduction”.

Don’t let them sell you the bill of goods they’ve prepared here. 

Cut spending, cut it now and do what is necessary to reduce the debt.

~McQ

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Geithner makes unsubstantiated claim in an attempt to establish a meme

W

hat do you do if you’re a politician and you promised that if you did something good results would be assured. And then you did it and, in fact, things got worse?

Well that’s the situation the administration faces. It claimed that the "stimulus" was a bit like a FedEx package – something that absolutely, positively had to be done or we would be facing horrific unemployment – over 8%. So the Democratic Congress (alone) jammed through a pure pork package of almost a trillion dollars and sure enough unemployment which was below 8% at the time, eventually shot to 10% (and has now receded to 9.5% "officially").

Faced with that, what the administration has decided to do is run Tim Turbo Tax Geithner, the Secretary of Treasury, out there and pretend like the “stimulus” worked.  No, seriously, that’s their plan – damn the facts, go out and essentially say they’ve got the economy in good enough shape that they can now step back and let the private sectors take over:

Treasury Secretary Timothy Geithner said the economy has now recovered sufficiently for government to begin to make way for private business investment.

Mr. Geithner’s comments on Sunday, which echo previous sentiments expressed by President Barack Obama, reflect a turning point in the government response to the worst economic downturn since the Great Depression, a period marked by deep federal intervention in the financial, housing, auto and other industries.

“We need to make that transition now to a recovery led by private investment,” Mr. Geithner said Sunday on NBC’s “Meet the Press.”

Now that takes some stones.  To pretend that government intervention has done much of anything requires Hillary Clinton’s “willing suspension of disbelief”.  The GDP is limping along in the 1 to 2% growth area, debt has shot through the roof, unemployment remains stubbornly high (and higher than when government “stimulated” the economy) and legislation passed by this administration – and its legislative agenda – has businesses sitting on the sidelines with a pile of money and refusing to participate because of the unsettled business climate.

However, running this meme allows the administration to step back from its failure by calling it a success and passing the blame, now, to the private side.  This can have a two-fold effect for them if they can successfully run this bluff.  

For one, they can claim the private sector is to blame for continued weakness.  That’s very useful to them.  Why?   Because it sets up what they really want – a second stimulus and more government control. 

“There’s going to be a good case for the government preserving some type of guarantee to make sure people have the ability to borrow to finance a house even in a very damaging recession,” he said on “Meet the Press.”

He said the administration would begin developing such a program very soon. “We’re going to take a careful look at a set of reforms that are going to be good for the country going forward and don’t leave us vulnerable to this kind of crisis in the future,” Mr. Geithner said.

And it provides something this administration desperately wants and needs: a scapegoat.

Of course, with midterms coming soon, this may end up being an attempt that is too little and too late.  But frankly I don’t think it will take.  It is far too cynical an attempt to sell something that already smells terribly rotten.  Just as the majority saw through the attempt by Obama to claim that the “stimulus” didn’t have a gram of pork in it (as stated earlier, it was pure pork), they’ll see through this attempt to sell “the economy is better and it’s because of the “stimulus”” that Geithner is attempting here.

This, as usual, is more about political posturing and meme creation than it is about reality.  And with this administration, that’s something people have already come to recognize and dismiss.

~McQ

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John Kerry "swift boats" himself

You may have figured out by now that I think we pay much too much to government in taxes and that I’m usually all in favor of anyone who figures out how to dodge them legally.

However, there are exceptions to that rule, and all politicians are one of them. If they’re going to make tax law, pass tax law and stick it to all of the "little people", then they should strictly abide by those laws at all levels and not seek to dodge taxes. Especially if they’re the type who have never met a tax they didn’t like.

Call it part of the price they must pay – literally and figuratively – for that power.

John Kerry, or as Jules Critenden calls him, Thurston Howell III (from Gilligan’s Island) has apparently decided that taxes are strictly for the little people and, by the way, job opportunities aren’t his responsibility.

Mr. Howell, er Kerry (who, it is rumored, once served in Vietnam), recently purchased a luxury yacht. The Senator from Massachusetts, however, won’t be docking the yacht there. Instead Rhode Island is his port of choice:

News that Kerry was docking the 76-foot custom-built sloop in Newport, R.I., was first reported in the Herald Friday. Sources told the Herald the yacht cost $7 million, meaning Kerry would owe the state more than $500,000 in excise and sales taxes.

Tsk, tsk – is that a good example to set, sir?  And that’s not all that’s rankled the good folks of Massachusetts (who, by the way, with Romneycare, have the highest insurance premiums in the US).  The yacht was foreign made, while ship builders in Massachusetts claim that it could have just as easily been built there:

With the nation enduring a nasty economy, painful joblessness and extreme belt-tightening, word of the luxury yacht’s foreign construction – as Americans yearn for work – could create a political tempest for Kerry.

“The message is, ‘The American boat builders aren’t good enough, and the Massachusetts people aren’t good enough to maintain it.’ It’s just a bad message all around,” said Connecticut boater Steve Potter, who docks in Charlestown.

Mr. Kerry’s reaction?  Why the great and powerful Oz works in mysterious ways:

When asked to respond to criticism of Kerry’s decision not to buy American, his state director, Drew O’Brien, said: “When it comes to creating and preserving jobs and economic opportunity in Massachusetts, no one has worked harder in Washington than John Kerry. Sen. Kerry is using smarts, clout and good old-fashioned hard work to make the Massachusetts economy grow and prosper.”

Yeah, it’s really hopping, isn’t it?  With an unemployment rate over 9%, I guess that’s good enough that the additional jobs "created and preserved” by having the yacht built in his  home state just didn’t qualify as “smarts”.

Great example set there, Mr. Kerry.  If this is an example of the “smarts” you employ, everyone should be on their knees thanking the deity of their choice for the fact that you lost the presidential election and didn’t get anywhere near the Oval Office.

~McQ

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Observations: The Qando Podcast for 25 Jul 10

In this podcast, Bruce and Dale discuss the dissatisfaction about President Obama’s competence, the oil spill, and the American stranded in Egypt.

The direct link to the podcast can be found here.

Observations

The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here. For podcasts from 2005 to 2009, they can be accessed through the RSS Archive Feed.


BlogTalk Radio – 8pm (Tonight)

Call in number: (718) 664-9614

Yes, friends, it is a call-in show, so do call in.

Subject(s):

Cap-and-Trade: Is it really dead or is it “dead” like health care?

 

Race Relations:  Is this administration helping the problem or aggravating it?

 

Rule of Law: Are we a nation of laws?  Or are we a nation of arbitrarily enforced laws?

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And now for something completely different

Looking for the perfect gift for the beer drinking PETA member you know. Not to worry, Scotland’s BrewDog brewery has just the gift.

Well, not this year as they’ve already sold out of the 12 bottles they made. And it’s a healthy brew – an ale they call "The End of History" – a little Francis Fukuyama joke.

At 55% alcohol and $765 it isn’t cheap nor is it for the faint of heart. As the company says, it should be treated “more like a whiskey” than a beer.

As for what would appeal to the PETA member?

Well, the recycling of roadkill as a cover for the bottle, of course.

100723-brewdog-beer-hmed-140a.grid-6x2

~McQ

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"Legal nullification" likely AZ immigration law case outcome

William Jacobson over at Le-gal In-sur-rec-tion (a great blog and always a worthwhile read) lays out the probable outcome of the DoJ case against the AZ immigration law:

Based on reports of the hearing before the federal District Court Judge yesterday, it appears that the provision of the Arizona immigration law requiring law enforcement to verify immigration status is likely to survive, while other aspects creating independent state criminal sanctions will not.

This outcome — with the caveat that a Judge’s comments do not necessarily predict the outcome — makes sense legally. There is no interference with the federal administration of the immigration laws if the state, after confirming that a person is here illegally, merely turns the person over to federal authorities.

That means, essentially that the part of the law that will survive is that which requires all law enforcement to check the immigration status of anyone of which have a reasonable suspicion may be here illegally.  And if they’re determined to be here illegally, turn them over to federal authorities.

And that’s where the probable “nullification” may take place –i.e. the nullification of the intent of the AZ law which had at its foundation the apprehension, removal and deportation of illegals found in the state.  As Jacobson says:

While the survival of this aspect of the Arizona immigration law would still outrage opponents, the practical effect would be to allow federal authorities to nullify the state law in practice by refusing to take custody of or prosecute those turned over by state authorities.

Indeed, this is what happens sometimes in Rhode Island, when the State Police notify federal authorities and there are no outstanding warrants on the person.

Willful disregard for the law. 

Isn’t one of the foundational principles of our nation “the rule of law” and not the “rule of men”?  Isn’t such willful disregard counter to that principle?  How does one count on being equal with all other men before the law when the government can arbitrarily decide what it will and won’t enforce?

All questions I’d like to see asked in court of the Department of Justice.  Put them on trial as well.  Make them explain why they feel entitled to ignore some law and rigorously enforce others.

If we don’t like a law, think it is wrong and should be taken off the books, there are several methods on the books to allow that – the courts or Congress (at a federal level) to name two.  But selective non-enforcement – at least in a country that purports to be governed by the “rule of law” – isn’t one of them.  And it drives states, such as AZ, to understandably take matters into their own hands.

It is the DoJ and ICE that should be in the docket – not AZ.

~McQ

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Bureaucracy and bureaucratese – no sign of common sense

This story out of Ann Arbor, MI is a perfect example of bureaucratic inertia and the use of bureaucratic language to evade a common sense solution to a changed situation:

The debate in Ann Arbor, where firefighters are being laid off due to a multimillion dollar budget deficit, is over an $850,000 piece of art.

That’s how much the city has agreed to pay German artist Herbert Dreiseitl for a three-piece water sculpture that would go in front of the new police and courts building right by the City Hall.

The city has the money to do it because in 2007, it agreed to set aside for public art 1 percent of money that went into capital improvement projects that were $100,000 or larger. Most capital projects involve streets, sewers and water.

Anyone – what has changes since 2007?  Perhaps the economic climate?  So if a city can agree to “set aside” money for public art – a luxury for economically flush time – why can’t it now agree to change that previous agreement?  Why can’t it now spend the money set aside on critical jobs jeopardized by the economic downturn?

Well here’s the city administrators answer, I guess:

City Administrator Roger Fraser wrote in an e-mail that the solid waste coordinator position was eliminated as a cost-cutting measure because the solid waste millage had decreased. Fraser wrote that the art coordinator position would be paid for by the public art fund.

Fraser noted that the public art dollars did not come from the city’s general fund, which is used to pay salaries and benefits, and that less than $6,000 of the art money came from the general fund.

The art projects also must have a "thematic connection" to the source of funding, Fraser wrote. The $850,000 art project is water-themed, because the money came from storm water funds.

So there.  If that isn’t a pant load of, well you know what it is.   As one resident noted, when it wants too the city has always found ways to shuffle money from one fund to another.   But if it did that, it couldn’t scare the hell out of the citizenry claiming it was going to have to lay off critical public safety types and therefore justify increasing taxes, etc.

"Administrators cry poverty while lavishing money on the beautiful people," LaFaive said. "The threat to dismiss firefighters often comes while officials protect golf courses, wave pools and art. No city can cry poverty while it defends recreation and aesthetics such as art."

Have you ever noticed that?  Layer upon layer of bureaucrats and non-essential workers stay on staff, but police and fire protection are the first on the block.  Meanwhile almost a million bucks is slated for “water art”.  And it is all defended by bureaucratic nonsense – bureaucratese.  When they want to do something, the rules mean nada.  When they don’t want to for whatever reason, the rules constrain them.

And Ann Arbor isn’t unique here – the same song and dance is going on at the state and local level.

This is your government at work.  The politicians are only the part-time help.  Bureaucrats are who really run it all.  And the the result?

Well, look around you.

~McQ

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