Free Markets, Free People

Monthly Archives: March 2012

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Economic Statistics for 30 Mar 12

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

Personal income rose 0.2% last month, while personal spending rose 0.8%. On a year-over-year basis, income rose 3.2% while spending rose 4.1%.The PCE Price Index, an inflation indicator, rose 0.3% for the month, and 2.3% for the year. The core PCE rose 0.1% for the month, and 1.9% for the year. Analysts had expected significantly higher consumer spending increases.

The Reuter’s/University of Michigan’s consumer sentiment index continues to improve, rising to 76.2 in the latest 2-week period.

The Chicago PMI indicates business activity remains strong, though growth has slowed a bit, to 62.2 from last month’s 64. Any reading above 50 generally indicates economic expansion. This report is often seen as a precursor to the national PMI, due out Monday.

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Dale Franks
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The liberal shock at the collapse of ObamaCare’s “Constitutional” arguments

I think it is felt, whether true or not at this point since we really don’t know, that ObamaCare is in real trouble.  You can see it everywhere with the NY Time opining that overturning it would be judicial activism and the various and sundry liberal blogs bleating out the same refrain.  They’re shocked.  They’re stunned.  They’ve decided they have to somehow characterize this as they tried to do Bush v. Gore, as a form of judicial malfeasance.

But as Don Surber points out, the arguments against the law aren’t new even if the left tried to wave them off and pretend they were weak.

And so, as John Podhoretz argues:

I diagnose the shock at the powerful Constitutional arguments advanced against Obama’s health-care plan as another example of the self-defeating parochialism of American liberals, who are continually surprised that conservative ideas and conservative arguments are formidable and can only be bested if they are taken seriously: “the strength of the conservative arguments only came as a surprise to [Jeffrey] Toobin, [Linda] Greenhouse and others because they evidently spent two years putting their fingers in their ears and singing, ‘La la la, I’m not listening’ whenever the conservative argument was being advanced.”

Its really not “conservative” ideas we’re talking about here (honestly, they’ve gone along with plenty of laws which shred the Constitution), but instead fundamental ideals on which the country was founded.  They were certainly advanced by conservatives in this case.  They are powerful ideas and I agree with Podhoretz, that liberals just waved them off.  They could not conceive of a law filled to the brim with good intentions (no matter how abysmal its execution or horrendous its cost) could be found as anything but Constitutional.

I can only suggest that their earlier takeover of the public education system left them in a civics class knowledge deficit about what the Constitutions says.  Must have happened about the time they decided schools had the job of indoctrinating youth about sex education and the like.

So as the law’s date with SCOTUS approached the left was supremely confident:

Twenty-six states and the National Federation of Independent Business challenged the constitutionality of President Obama’s signature piece of domestic legislation, the Patient Protection and Affordable Care Act. The sophistries on which the Obamaphiles relied to defend their health care power grab were perhaps best summarized by Slate legal columnist Dahlia Lithwick: “That the law is constitutional is best illustrated by the fact that — until recently — the Obama administration expended almost no energy defending it.”

That lack of energy came back to haunt them Tuesday when Solicitor General Donald Verrilli turned in a stammering, barely coherent performance worthy of the public defender in My Cousin Vinny as he struggled to articulate a constitutional defense of Obamacare. The arguments went only slight better for Verrilli yesterday. The administration seemed ill prepared to answer even basic, predictable questions about the law’s constitutional basis.

Absolutely correct.  Verrilli was awful and that is acknowledged by both sides (it was like he was arguing for something he just really didn’t believe in at times). 

Jennifer Rubin’s take:

It’s not surprising that liberals, most of whom have not read or shown interest in the arguments of the challengers, were stunned to learn that there really is a constitutional difference between taxing and regulating and between inducing one into commerce and regulating commerce that already exists. It is this failure to understand, let alone imagine that constitutional text has meaning and there are actual limitations on federal power, that explains the stunned reaction of the liberal elite. Like puppies smacked on the nose by a rolled-up copy of the Constitution, they are flabbergasted.

Greg Sargent seems to understand the point:

But there’s another explanation for the botched prediction: Simply put, legal observers of all stripes, and Obamacare’s proponents, including those in the administration, badly misjudged, and were too overconfident about, the tone, attitude and approach that the court’s conservative bloc, particularly Justice Scalia, would take towards the administration’s arguments.

But as usual, tries to make it personal and political instead of acknowledging the power of the arguments against the law:

All of which is to say that the law’s proponents were badly caught off guard by the depth of the conservative bloc’s apparent hostility towards the law and its willingness to embrace the hard right’s arguments against its constitutionality. They didn’t anticipate that this could shape up as an ideological death struggle over the heart and soul of the Obama presidency, which, as E.J. Dionne notes today, is exactly what it has become.

Or in other words, sticking up for the foundational principles underlying the US Constitution is now a “hard right” thing.  Any possibility they’ll continue to be “shocked” in the future?

They will if they repeat the “arrogant, dismissive and ill-prepared” tactic in the future.

Again, we don’t know how this will actually end and have to be careful about reading too much into the oral arguments, but that said it is hard not to note how poorly those arguments went for the administration and at least realize that after arrogantly ramming the bill through the Democratic controlled Congress and waving it around triumphantly in the face of those who opposed it, its at least an enjoyable bit of schadenfreude going on right now, isn’t it?

~McQ

Twitter: @McQandO


Economic Statistics for 29 Mar 12

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

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

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

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

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

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Dale Franks
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Ruminations about SCOTUS/ObamaCare

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

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

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

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

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

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

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

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

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

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

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

This is a critical point.

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

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

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

Here’s hoping.

~McQ

Twitter: @McQandO


Obama budget goes 0-414 in House

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

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

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

Oh good.

Meanwhile:

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

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

My guess is it’s Bush’s fault.

~McQ

Twitter: @McQandO


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

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

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

His examples from the report:

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

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

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

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

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

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

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

Hello, EPA?

~McQ

Twitter: @McQandO


Economic Statistics for 28 Mar 12

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

The MBA reports Purchase Applications rose 3.3% last week.  Sadly, re-fis dropped -4.6%, so overall mortgage applications fell -2.7%

Durable goods orders rose 2.2% in February, which is up 12.2% from February, 2011. Ex-transportation, orders rose 1.6% for the month, 8.5% from last year.

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Dale Franks
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Link-o-rama

Sometimes there are a lot of stories out there on a day but few that really spark a need for a lengthy discussion.  Today, at least to this point, is one of those.  Yes, all attention is focused on SCOTUS and the ObamaCare law, but that will be later in the day.

But there are some things I’d like to just hit with a short comment or two.

Such as the fact that Newt Gingrich simply doesn’t know when it’s over.  Hey Newt, it’s over and charging $50 bucks for a campaign photo isn’t going to endear you to those whose support you’re seeking.  And by the way, when the press pulls all their people from your campaign, it’s a sign that even most addle-brained politicians can usually figure out.

Anyone else as appalled at the “love fest” Dick Cheney sparked by having the audacity to accept a heart transplant.  And how about this “bioethicist” who weighed in saying Cheney was “too old” to qualify and shouldn’t have gotten one.  But remember, in the future, there will be no “death panels”.  Newsweek again proves why it’s not worth reading anymore.

Do you remember all the lefties hyperventilating over the rise of militias a while back?  And the Southern Poverty Law Center claiming the they were the internal threat of the future.  That was all driven by a group called the Hutaree militia group out of Michigan.  They were arrested by federal agents and charged with conspiring to commit sedition and conspiring to use weapons of mass destruction among other things.  Yesterday:

U.S. District Judge Victoria Roberts granted defense requests for acquittal on all charges against five of the defendants and the most serious charges against two others: alleged ringleader David Stone Sr. and his son Joshua Stone.

Acting after prosecutors rested their case, Roberts ruled the government didn’t have enough evidence to back its claims.

Given this DoJ, is anyone surprised?

Under the category, “there is no cure for stupid”, we have some wannabe assassins, to include a former army officer and an active duty soldier, who’ve been plotting to do “wet work” with undercover DEA agents (thinking they were drug cartel members) for a year.  You’ve got to read the story to believe it.  My guess is there are way too many ninja movies in these bozo’s past.

Spike Lee is a dumb ass.

The real reason to push the global warming scare.

Astroturfing Allen West.  Hey, why not?  The professional protesters on the left are always looking for a new gig, especially now that OWS is winding down.

VIPER teams?  Did you know that TSA is now out on the highways and byways?

Zimmerman/Martin case – it has nothing to do with the FL “stand your ground” law.  In fact, it is “legally irrelevant”.

EPA slap down.  Nothing like missing a deadline to act by 3 years.  The court was not impressed.

Have we hit rock bottom on this little charade yet?

~McQ

Twitter: @McQandO


B..b..but won’t poor and minority students be “disadvantaged”?

Apparently cheating on the SAT and ACT is rampant.  Therefore:

The millions of students who take the SAT or ACT each year will have to submit photos of themselves when they sign up for the college entrance exams, under a host of new security measures announced Tuesday in the aftermath of a major cheating scandal on Long Island.

The two companies that administer the tests, the College Board and ACT Inc., agreed to the precautions under public pressure brought to bear by Nassau County District Attorney Kathleen Rice, who is overseeing the investigation. The measures take effect in the fall.

"I believe these reforms, and many others which are happening behind the scenes, will prevent the kind of cheating that our investigation uncovered and give high schools and colleges the tools they need to identify those who try to cheat," Rice said.

Rice has charged 20 current or former students from a cluster of well-to-do, high-achieving suburbs on Long Island with participating in a scheme in which teenagers hired other people for as much as $3,500 each to take the exam for them. The five alleged ringers arrested in the case were accused of flashing phony IDs when they showed up for the tests. All 20 have pleaded not guilty.

Students have long had to produce ID to take the test (another example where ID is required), but the use of a picture is new.  That is, students will now have to submit a head shot with their application for the tests.  The picture will be printed on their ticket presented on the day of the test.  Additionally the test results will be sent to their high school along with the picture of the student for a final check to ensure the student taking the test is the actual high school student.

All of this for what?  To ensure the integrity of the testing system.  Something, apparently, that is too much to ask when applied to the voting system.

And thus far, not a single cry about poor and minority students being disadvantaged.  No one talking about anyone being “disenfranchised”. Go figure.

~McQ

Twitter: @McQandO


SCOTUS and ObamaCare: So how is Justice Kennedy feeling about this? [Update]

One of the jokes that has gone around for some time concerning ObamaCare’s eventual hearing in the Supreme Court is it will likely revolve around what Justice Kennedy had for breakfast.  The obvious point being most SCOTUS observers can pretty much predict how the other 8 Justices might rule, but Kennedy is sort of the wild card and swing vote.

So, as you might imagine, many eyes are on him.

Today was the 2nd day of oral arguments in the case.  This question from Justice Kennedy may give an indication of how he’s leaning in the case:

JUSTICE KENNEDY: “Could you help — help me with this. Assume for the moment — you may disagree.  Assume for the moment that this is unprecedented, this is a step beyond what our cases have allowed, the affirmative duty to act to go into commerce. If that is so, do you not have a heavy burden of justification?   I understand that we must presume laws are constitutional, but, even so, when you are changing the relation of the individual to the government in this, what we can stipulate is, I think, a unique way, do you not have a heavy burden of justification to show authorization under the Constitution?”

My answer to his question is “you bet”.  How did the Solicitor General answer?

GENERAL VERRILLI: So two things about that, Justice Kennedy. First, we think this is regulation of people’s participation in the health care market, and all — all this minimum coverage provision does is say that, instead of requiring insurance at the point of  sale, that Congress has the authority under the commerce power and the necessary proper power to ensure that people have insurance in advance of the point of sale because of the unique nature of this market, because this is a market in which — in which you — although most of the population is in the market most of the time — 83 percent visit a physician every year; 96 percent over a five-year period — so virtually everybody in society is in this market, and you’ve got to pay for the health care you get, the predominant way in which it’s — in which it’s paid for is insurance, and — and the Respondents agree that Congress could
require that you have insurance in order to get health care or forbid health care from being provided.­

Uh, I don’t know about you, but it seems to me that the Solicitor General sidestepped the question and erected a giant strawman.

If you want to read the transcript of today’s oral arguments they’re here and they’re very interesting.  If I had to guess, I’d say the law is in trouble.  I found the arguments for to be fairly weak and I got the indication that most of the Justices (well, at least a majority of the Justices) may have as well.

Bottom line, Kennedy’s question is still laying out there unanswered. 

UPDATE: More Justice Kennedy:

JUSTICE KENNEDY: But the reason, the reason this is concerning, is because it requires the individual to do an affirmative act. In the law of torts our tradition, our law, has been that you don’t have the duty to rescue someone if that person is in danger. The blind man is walking in front of a car and you do not have a duty to stop him absent some relation between you. And there is some severe moral criticisms of that rule, but that’s generally the rule.

And here the government is saying that the Federal Government has a duty to tell the individual citizen that it must act, and that is different from what we have in previous cases and that changes the relationship of the Federal Government to the individual in the very fundamental way.

Indeed, it does.

~McQ

Twitter: @McQandO

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