Free Markets, Free People

Monthly Archives: January 2012

Newt the victim

Just what the GOP needs:

Under siege from Mitt Romney and conservative elites who seem to be conspiring against his candidacy, Gingrich abandoned his stump speech on Thursday in favor of an angry tirade against his most daunting Republican rival and the Washington establishment. He isn’t the candidate who vowed to stay positive in Iowa, or the nose-to-the-grindstone guy he was in South Carolina.

As he took the stage before a tea-party crowd here, Gingrich seethed at Romney for the avalanche of negative ads blanketing the Florida airwaves and bashed the Beltway denizens for coalescing to obstruct his rise.

“There’s the Washington establishment sitting around in a frenzy, having coffee, lunch and cocktail hour talking about, ‘How do we stop Gingrich?’” he said, referring to a spate of prominent Republicans who painted him Thursday as a philandering egomaniac comparable to Bill Clinton and not as close to Ronald Reagan as he would like to think.

The former House speaker told the tea party crowd that they shouldn’t be confused by the attacks coming from the right because it’s still part of the scared establishment.

“Remember, the Republican establishment is just as much an establishment as the Democratic establishment, and they are just as determined to stop us,” he said.

And Newt Gingrich used to define the Republican establishment. 

Frankly, though there are two of them,  this is boiling down to GOP voters having a sort of Hobson’s choice – pick one of these two or Obama wins.  The problem, of course is that picking either of the two could mean an Obama win, and voters know that.  Both are about as much establishment candidates as one could imagine.  And neither offer the depth of message that Tea Party and conservative voters are looking for.   When watching these two, voters are reduced to wondering which one has the best shot at unseating Obama.

That person isn’t Newt Gingrich.  And Romney is only marginally better in that regard (I’m not endorsing Romney, I’m simply pointing out that in the big scheme of things, I think he’d have a relatively better shot than Gingrich).

As was obvious Gingrich is as thin-skinned as Obama and if he thinks the Romney attacks (along with those by the Democrats) are tough now, he ain’t seen nuttin’ sport.  This is just a warm up.

On Thursday, Gingrich went off on Romney for his negative ads, some of which are being aired by the former Massachusetts governor’s campaign and others by his super PAC. The ads depict Gingrich as misrepresenting his consulting work for mortgage broker Freddie Mac, which Romney says was really lobbying. They show him sitting on a couch with Rep. Nancy Pelosi and cite her comments about his 1990s House ethics case.

“This is the desperate last stand of the old order throwing the kitchen sink, hoping something sticks because if only they can drown us in enough mud, raised with money from companies and people who foreclosed on Floridians,” Gingrich said as he pounded on the podium. “Let’s be really clear, you’re watching ads paid for with the money taken from the people of Florida by companies like Goldman Sachs, recycled back into ads to try to stop you from having a choice in this election.”

Gingrich is referring to the fact, he says, that Romney owns stock in Goldman Sachs, which he claims is partially responsible for the mortgage crisis in Florida.

Yeah, and Freddie Mac is as clean as a pin concerning the mortgage crisis, isn’t it?  And did he or did he not do the Pelosi thing?  And if it were Mitt Romney on the couch, what would Gingrich be running in his ads?

Here we have another arrogant politician who thinks he should be able to wave away his record and pretend it never happened, because, you know, he’s got great ideas (I don’t want to hear about a freaking moon base when we’re 16 trillion in debt) and is the self-declared savior of our country.  Oh, and then there’s stuff like this.

Anyway, we’ve got one like that sitting the the White House now and chances are, given the GOP choices, he’ll be there next year as well.

“There is something so grotesquely hypocritical about the Romney campaign that I think it’s just going to melt down over the next six or eight weeks as the American people learn more about him,” he told reporters after the tea party rally.

Pot, meet kettle.

I don’t know who characterized this race as the Indy 500 in clown cars, but it certainly is living up to that billing.


Twitter: @McQandO


I’m stunned every now and then when I see a story like this.  By the way this isn’t an indictment of Germany, necessarily, its not the only country in which you’ll find such knowledge gaps.  Japan has hidden its atrocities during WWII as well.  In fact, most countries would prefer not to discuss such behavior.  

But it sure makes it hard to say “Never again” and have it mean anything if part of the population doesn’t know what it refers too.

One in five young Germans has no idea that Auschwitz was a Nazi death camp, a poll released Wednesday showed, two days ahead of Holocaust memorial day.

Although 90 percent of those asked did know it was a concentration camp, the poll for Thursday’s edition of Stern news magazine revealed that Auschwitz meant nothing to 21 percent of 18-29 year olds.

And nearly a third of the 1,002 people questioned last Thursday and Friday for the poll were unaware that Auschwitz was in today’s Poland.

Maybe it’s not significant that 21% didn’t recognize a name that is so identified with concentration camps that it could be a synonym.  Perhaps it is good enough that 90% of the total knew it was a concentration camp.  Or does it signal that the shame and the knowledge of the shame brought to Germany by the Nazis is beginning to fade (of course my guess is if you asked the question of the same demographic here in the US, the percentage to which the name would mean nothing would probably be higher)? 

Or, does it perhaps point to a demographic in which a portion is so self-absorbed that history like that represented by Auschwitz simply doesn’t register?

I wonder at times, as I watch the WWII era dim as veterans die off, whether things like D-Day and its import or Pearl Harbor will even get a mention in a few years.  

But back to the poll.  If ever there is something every German school kid should know about it is the Nazi era.  If ever there was a subject to which they should be exposed, to include all of the atrocities by that regime, it is the subject of Germany and Nazism. 

I can’t help but believe, and I don’t know it for sure, that the subject gets taught but it isn’t something that is lingered over by schools.  And I wonder how sanitized it has become now days. 

The fact that a fifth of the young demographic said the name “Auschwitz” had no meaning for them has thinking it is both short and sanitized when presented.  

Wonder if they knew the name “Dachau” (10 mines northwest of Munich).


Twitter: @McQandO

Economic Statistics for 26 Jan 12

Today’s economic statistical releases:

Durable goods orders for December rose a sharp 3%, and ex-transportation orders were up 2.1%. November orders were also revised upward sharply to 4.3% from 3.7%

Initial claims for unemployment rose 21,000 to 377,000. The 4-week moving average still dropped, however, to 377,500.

The Bloomberg Consumer Comfort Index rose 1 point to -46.4.

The Chicago Fed reports its National Activity Index rose to 0.17 in December from -0.46 the prior month. The 3-month moving average stands at -0.19, which is slightly below-trend growth.

New home sales in December fell 2.2% to a disappointing 307,000 annual rate, well below analyst expectations of 320,000.

The Conference Board reports that the Index of Leading Economic Indicators—which has received a huge revision to the components that make it up—rose 0.4% last month. In the LEI, money supply has been removed in place of a new credit measure, and deliveries have been dropped in favor of the ISM New Orders index. As part of this makeover, previous months have been revised sharply downward to 0.2% and 0.6%.

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$2 billion US dollars to Brazil, but the oil will go to China

Remember this?

The U.S. is going to lend billions of dollars to Brazil’s state-owned oil company, Petrobras, to finance exploration of the huge offshore discovery in Brazil’s Tupi oil field in the Santos Basin near Rio de Janeiro. Brazil’s planning minister confirmed that White House National Security Adviser James Jones met this month with Brazilian officials to talk about the loan.

The U.S. Export-Import Bank tells us it has issued a "preliminary commitment" letter to Petrobras in the amount of $2 billion and has discussed with Brazil the possibility of increasing that amount. Ex-I’m Bank says it has not decided whether the money will come in the form of a direct loan or loan guarantees. Either way, this corporate foreign aid may strike some readers as odd, given that the U.S. Treasury seems desperate for cash and Petrobras is one of the largest corporations in the Americas.

And  this?

“We want to work with you. We want to help with technology and support to develop these oil reserves safely, and, when you’re ready to start selling, we want to be one of your best customers.”

Mr. Obama was saying that while he was drastically slowing down leasing and permitting in the US and whining about “subsides” to US oil corporations.  We apparently can subsidize government controlled oil companies in foreign countries, but not here (and I’m not arguing for subsidies here – just pointing out the usual Obama contradiction – kind of like he’s against bailouts, except for Chrysler, GM, Solyndra, etc.)

Well, that little jump-start of ObamaDollars has indeed helped “develop these oil reserves”.  And the beneficiary?

Off the coast of Rio de Janeiro — below a mile of water and two miles of shifting rock, sand and salt — is an ultradeep sea of oil that could turn Brazil into the world’s fourth-largest oil producer, behind Russia, Saudi Arabia and the United States.

The country’s state-controlled oil company, Petrobras, expects to pump 4.9 million barrels a day from the country’s oil fields by 2020, with 40 percent of that coming from the seabed. One and a half million barrels will be bound for export markets.

The United States wants it, but China is getting it.

Less than a month after President Obama visited Brazil in March to make a pitch for oil, Brazilian President Dilma Rousseff was off to Beijing to sign oil contracts with two huge state-owned Chinese companies.

Well done, Mr. Obama.

[HT: Red Country]


Twitter: @McQandO

Let’s get REALLY controversial

Now, before I ask this, keep in mind that I’m a National League fan, being a life-long Astros fan, as well as a Dodgers fan. I also like the Rangers and the Tigers, but I’m primarily an NL devotee. As such, I am inclined against the designated hitter, because I grew up watching the National League brand of Baseball, prefer it, and only later developed a taste for AL teams.

But here’s the thing. Albert Pujols is 31 and has a shiny new 10-year contract with the Angels. As of today, Prince Fielder(28) is going home to Detroit for 9 years with the Tigers. That puts them at 41 and 37, respectively, when their contracts are up. Do we really think Pujols will be holding down the first bag at 41? Jeez, will Prince Fielder be able to play first at 31 with his…ahem…physical stature. No, of course not.

But, they can work out big deals in the AL because of the Designated Hitter rule. Even when they can’t play a position any more, big hitting still gives them a place on the roster.

But what NL team can take a risk on long-term contract for a big-hitting position player in his 30s? Doesn’t that force star hitters into the AL, and make the NL a weaker league offensively? I mean, not only do you have the pitcher at bat, but the remaining players are lesser sluggers than the AL guys. Is the NL really all about pitching, or is it just weaker hitting?

There seems to be a bit of a push to make the DH apply to the NL, in order to keep the leagues competitive offensively. The reasoning is that, at this point, everybody but the NL uses the DH, and it’s a bit silly for the two major leagues to play two different brands of baseball. And the DH really does result in a different kind of game. Not only would applying the DH to the NL equalize the game, it would allow sluggers—and teams—more options to keep sluggers kin the game, even when they get a bit too old to hold down a position well.

Could the NL just give in and accept the DH? Should they?

Dale Franks
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The GOP Götterdämmerung

Political parties exist for a reason, and it’s a pretty simple one: to implement the policies their voters prefer. It’s a pretty straightforward deal.  The voters pick the candidates that best embody their policy preferences, and the candidate, if elected, implements those policies. It works most of the time.

But not always. Parties sometimes go astray for an election cycle or two. Generally, they are pulled back into line by the voters. But, once in a great while, a political party simply fails. The most recent failure of a major political party in the United States was that of the Whigs in the 1850s, when the issue of slavery so divided the northern and southern factions of the party that its voters were simply unable to continue as a unified political entity. Pro-slavery elements absconded to the Democratic Party, while the anti-slavery elements created the Republican Party.*

It is interesting to note this history when viewed against the current state of the Republican Party. What seems to be developing in the GOP is a similar fissure over the size and scope of government. It seems not to be so much a debate among the rank and file, however, as it is between the grass roots and the party establishment.

When I speak of the GOP establishment, I will define it, for convenience, as those members of the GOP whose incomes and/or professional lives are derived primarily from participation in electoral politics, either directly, as a candidate or staffer, or indirectly through journalism, consulting, policy study, or party activism.

There is an increasing sense that the party establishment is more interested in the process of politics, bipartisanism, and policy than they are about the principles behind the party’s ostensible ideology.

The result seems to be a long succession of candidates for whom the principles of limited government and fiscal responsibility seem to have taken a back seat to "getting things done" and "working with the Democrats" to "solve problems". The perception seems to have taken hold that this has resulted in accepting to some extent the collectivist ideological premises of Democrats, though in a milder form.

Bob Dole, famously criticized as "the tax collector for the welfare state", was generally thought of as a political moderate. George W. Bush’s compassionate conservatism was essentially an embrace of big government for socially conservative ends, rather than limited government, and ultimately, through No Child left behind and Medicare Part D, an embrace of big government for political ends. John McCain was notorious for his "maverick" ways, which came to be generally defined as siding with the Democrats on domestic issues. The GOP seems incapable of producing identifiably limited government conservatives as national candidates.

During this same time, the GOP electorate has become increasingly interested in restraining the size and scope of government, reducing regulations, reducing taxes, and balancing the Federal budget.

Indeed, it’s important to remember that the TEA Party movement began not as a reaction to Mr. Obama’s election, but rather in opposition the Bush Administration’s push for TARP and the bailouts, all of which President Obama embraced and expanded.

This increasing divide between the GOP electorate has led to some embarrassing moments, such as the candidacies of Sharron Angle and Christine O’Donnell in opposition to the GOP establishment, but also some successes, such as the candidacies of Marco Rubio and Allen West. Both, however, often came in opposition to the wishes of the GOP establishment. Some results of this tension are not yet fully known, such as the ultimate outcome of Sarah Palin’s position as a sort of spokesperson and power-broker for a large percentage of the GOP electorate, at the same time her reputation among the GOP is establishment is, shall we say, mixed.

So, we come to the 2012 election, and the primary candidates for the GOP presidential nomination are Mitt Romney and Newt Gingrich. Both men are identifiably part of the GOP establishment. Both are flawed candidates from the point of view of limited-government conservatives. Frankly, neither of them would have a chance at winning an election against Mr. Obama in a normal political environment. Their one hope for beating Mr. Obama in the fall is that this election year is decidedly not normal.

From a policy point of view, Mr. Romney simply isn’t a conservative. He is merely somewhat more conservative than the average Democrat, which is to say he is noticeably more liberal than the GOP rank and file. His record gives every indication of willingness to "work with" Democrats, which can be best understood as code for doing nothing that Democrats strongly oppose. In a normal election, this would translate into a deep sense of ennui among GOP voters that would probably doom his chance of victory.

Mr. Gingrich has a more credible argument for supporting and implementing conservative policies than Mr. Romney in many ways. He is also one of the most actively disliked politicians in the United States. He seems utterly incapable of seeing himself in anything other than world-historical terms, and the result is a noticeably overweening ego.  He is the modern embodiment of General George McClellan, Abraham Lincoln’s opponent in the 1864 election, who once remarked about himself, "I know that I can save this country, and that I alone can." The instinctive dislike of Mr. Gingrich by the general electorate would normally doom his candidacy in an election as well.

Mr. Romney carries Romneycare like a millstone around his neck, yet does so gladly, and refuses to repudiate it. One of his advisors, former MN senator Norm Coleman, said yesterday that Obamacare would not be repealed. Though the campaign quickly came out in opposition to that position, Mr. Romney’s continued defense of the Massachusetts health care plan remains troubling to GOP voters. He speaks about conservative ideals, but his entire political history is one of compromise with them. This may have been a necessity in a deep blue state like Massachusetts, but it translates poorly to a far more conservative national GOP electorate.

Mr. Gingrich managed to make himself so unpopular as Speaker, even with his fellow Republicans in the House, that he was driven out of Washington like some sort of poison troll. Moreover, as recently as last March on Meet the Press, he supported the individual mandate for health insurance, the key controversy over Obamacare. Mr. Gingrich still defends his support of Medicare Part D. Mr. Gingrich was also one of the primary movers behind the K Street project, which tied the Republican Party deeply with lobbyists, pushed the party into supporting lobbyist pet projects, and ended with the fall of Jack Abramoff, as well as some leading GOP politicians like Tom DeLay. His recent criticisms of Bain Capital, and the concept of private equity firms in general, are also troubling, coming, as they do, from a progressive viewpoint.

In short both men have troubling histories that raise serious questions about their ability to govern as conservatives. I would suggest that if the next president is a Republican, and does not do everything in his power to repeal Obamacare, the Republicans will be finished as a national political party. The same holds true of they fail to restrain federal spending or the growth of the national debt. That would be the short path to the GOP going the way of the Whigs.

Irrespective of presidential politics, however, the GOP is still on the path to decline under their current leadership. If, over the next few election cycles, the GOP establishment cannot bring themselves to actively push candidates of distinctly limited government views, and if they do not actively push for smaller government, less spending, and less debt in Congress, the GOP rank and file will abandon the party and create a replacement for it.

Barry Goldwater’s motto in 1964 was, "A choice, not an echo". Sadly, the GOP establishment seems most comfortable offering a moderately less radical echo of the Democrats. The GOP electorate, however, increasingly wants a choice. A party that is incapable of promoting candidates with a distinctly fiscally conservative, limited government ideology is also incapable of providing that choice.

That is a path to extinction.


*Interestingly, the southern Whigs imparted a more conservative, business-friendly element into southern Democrats, the vestiges of which still remain, and one result of which was the general electoral success by southern Democrats for the Presidency, opposed to Northerners. Of the Democratic presidents in the 20th century, Wilson, Johnson, Carter, and Clinton were all distinctly southerners, while only Roosevelt and Kennedy were northerners. Truman is the odd man out, being from Missouri, though it certainly was at least as much southern as it was northern.

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I have no bubble!

How Thick Is Your Bubble?

View user's Quiz School Profile

Score » 14 out of 20  (70% ) 
On a scale from 0 to 20 points, where 20 signifies full engagement with mainstream American culture and 0 signifies deep cultural isolation within the new upper class bubble, you scored between 13 and 16.

In other words, you don’t even have a bubble.

Quiz School Take this quiz & get your score

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HASC Republicans: A common sense solution to sequestration and national defense

The DoD is presently working through a half trillion dollars in budget cuts mandated by Barack Obama which is going to see a much weaker military despite what any of the madly spinning politicians claim. 

But the real meat axe is hanging just over the horizon in what is known as “sequestration” cuts, i.e. cuts which will be made across the board because the debit committee was unable to reach a deal on the cuts in the budget (by the way, Harry Reid, it’s now been 1001 days since you, Mr. Majority Leader, passed a budget out of the Senate) for the future.   That would mean an additional half trillion in cuts to DoD, the result of which, would simply be disastrous to our national security.

Here, in this video, a group of Republican House Armed Services Committee members make a pitch for a common sense solution that would absorb the need for those sequestration cuts.  In short, cut the Federal workforce by 10% – but do it over time and strictly through attrition.

Someone, anyone, tell me we couldn’t get along without 10% of the Federal workforce:


Twitter: @McQandO

Economic Statistics for 25 Jan 12

Today’s economic statistics are all about housing:

After last week’s huge rise, the MBA is reporting a sharp pullback on mortgage applications. The composite index fell -5% last week, with the purchase index off -5.4% and refinance index down -5.2%.

FHFA reports house prices rebounded a bit, up 1% for the month, but still down -1.8% compared to last year.

The Pending Home Sales Index fell to 96.6 from 100.1 this month. Pending home sales volume is down -3.5%.

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SOTU–About those energy claims

One of the things I heard in the State of the Union address by Barack Obama were a legion of contradictions, shaded truth and outright fiction.  Never more than in the section about oil and gas:

Over the last three years, we’ve opened millions of new acres for oil and gas exploration, and tonight, I’m directing my administration to open more than 75 percent of our potential offshore oil and gas resources.  (Applause.)  Right now — right now — American oil production is the highest that it’s been in eight years.  That’s right — eight years.  Not only that — last year, we relied less on foreign oil than in any of the past 16 years.  (Applause.)

But with only 2 percent of the world’s oil reserves, oil isn’t enough.  This country needs an all-out, all-of-the-above strategy that develops every available source of American energy.  (Applause.)  A strategy that’s cleaner, cheaper, and full of new jobs.

We have a supply of natural gas that can last America nearly 100 years.  (Applause.)  And my administration will take every possible action to safely develop this energy.  Experts believe this will support more than 600,000 jobs by the end of the decade.  And I’m requiring all companies that drill for gas on public lands to disclose the chemicals they use.  (Applause.)  Because America will develop this resource without putting the health and safety of our citizens at risk.

The development of natural gas will create jobs and power trucks and factories that are cleaner and cheaper, proving that we don’t have to choose between our environment and our economy.  (Applause.)  And by the way, it was public research dollars, over the course of 30 years, that helped develop the technologies to extract all this natural gas out of shale rock –- reminding us that government support is critical in helping businesses get new energy ideas off the ground.  (Applause.) 

Let’s hit the first paragraph with Bureau of Land Management numbers as provided by the Energy Today blog, shall we?

  • New leases on federal lands were down 44% in 2009/2010 compared to 2007/2008.
  • Permits and new wells drilled were both down 39% for the same time frame.
  • The economic downturn in 2007 was a factor in this decline, but leasing, permitting and drilling have rebounded on private lands; the decline in new permits in the West is significantly greater on federal lands (-39%) than non-federal, private lands (-20%) over the last two years.
  • Returning permitting, leasing and drilling to 2007/2008 levels would create 30,000 jobs over the next four years and increase federal royalties by $2 billion.

So “opening” land means zippity do dah.  Leases and permits are where the action is and neither have increased under this administration as he’s have you believe.  In fact, they’re down quite markedly. 

Note also that the increases in leasing, permitting and drilling has been on private lands.

There’s also the claim that there has been lower imports from foreign suppliers since his administration began, with the obvious intent that one is supposed to connect his claim above with delivering that result.

Uh, no:

Lower imports are the result of lower demand, and increasing production has come despite Obama’s policies, according to Jack Gerard, American Petroleum Institute President. The U.S. needs a “course correction” on energy policy that includes faster permitting on federal lands in the West and in the Gulf of Mexico, he said.

In case President Obama missed it, we’re in the middle of a deep recession, one which has driven the demand for oil down considerably.  It has nothing to do with his policies in particular and, in fact, had the economy been booming, the effect of his policies would be much more widely felt and an increase in foreign imports would have been likely.

As Institute for Energy Research president Thomas Pyle said:

He also claimed credit for the fact that oil imports are down, even though the drop owes more to the ongoing hardships experienced by millions of Americans who cannot find jobs or afford to drive in the Obama economy.

And, of course, as mentioned above, if indeed the Obama administration would just return to 2007/2008 permitting levels, 30,000 jobs could be had immediately.

Then, of course, there’s the Keystone XL pipeline which was ignored both in Obama’s discussion of energy, oil and gas as well as his discussion of infrastructure projects. 

Pyle also took exception to the claim that the US only has 2% of the world’s proven oil reserves.

"The president continues to repeat the discredited mantra that America only has 2 percent of the world’s oil reserves. The Institute for Energy Research released last month the North American Energy Inventory, which uses government data to demonstrate that America is literally floating on energy. Under North American soil is twice as much oil as the combined proved reserves of every OPEC nation combined. As for natural gas, we have enough on this continent to provide America’s electricity needs for the next 575 years at current usage. The president just isn’t being honest with the American people about the vast energy supply that is literally under our feet. His own government reports show it.

Then there’s fracking and natural gas.  The administration would have you believe that it is dangerous to the public’s health.  Thus the lines about the public’s health and safety.  But other than disinformation, there is little if anything to back this fear. 

Only those who don’t understand the process fear it.  As I’ve mentioned for some time, fracking is not new.  It isn’t some new technology that has suddenly been discovered.  Fracking has been in use in the US for over 60 years and has been used on over a million wells. 

Suddenly however, it is a threat to public safety.  Well, science says that’s most likely not true:

Professor Mike Stephenson of the British Geological Survey said most experts thought the process, known as fracking, was a "pretty safe activity".


Professor Stephenson said the distance between groundwater supplies 40m to 50m below the surface and the sources of gas in the shale a mile or two underground, made it unlikely methane would leak into water as a result of fracking.

He said: "Most geologists are pretty convinced that it is extremely unlikely contamination would occur."

Additionally, and this is important:

"There’s natural methane in groundwater and you have to distinguish between what’s there already and what might have leaked in."

Natural methane like this.  So, like global warming, it would be nice to remove the junk science from the real science and deal with facts. 

Not to wander too far afield, this is just part of the spin that is evident throughout the speech on many subjects.  It is, as one would expect, an entirely one-sided account designed to make a very thin and poor record look much deeper and rich. 

Of course Obama isn’t the first or only president to do this, just the latest.  But it is importantly to understand the disingenuousness of this attempt to persuade.  Only then can anyone make an informed decision about his record. 

As he likes to do, he’s treated us to glowing rhetoric and very passable acting.  But for the most part, he’s highlighted three years of accomplishing nothing (see first post with video) and on that which he is willing to claim, the real truth, which is not flattering to him, is to be found in the details.

He has a record and he has to run on it.  And despite all the spin and shading, it is not a good one.


Twitter: @McQandO

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