Free Markets, Free People

Monthly Archives: April 2012


Greenpeace’s dumb answer to a good question

Apparently Greenpeace has decided that dissent and disagreement (especially when it is effective) doesn’t warrant protection under the right to free speech.

That’s especially true if you’re a dirty, rotten global warming “denier”.

From a FAQ on the Greenpeace site, this question: “Don’t the deniers have a right to free speech?"

No poisoning of the well with the question, is there?  They couldn’t ask “don’t those who disagree with the theory of man-made global warming have a right to free speech”?

If they’d phrased the question that way it might have been harder to attempt to justify this idiotic answer (not that it can be justified even with their poison question):

"There’s a difference between free speech and a campaign to deny the climate science with the goal of undermining international action on climate change," Greenpeace argues. "However, there’s also responsibility that goes with freedom of speech – which is based around honesty and transparency.  Freedom of speech does not apply to misinformation and propaganda."

Because, you know, there’s consensus and the science is settled and all that.  Nothing like smug but unsubstantiated faith in their crumbling cause, huh?

Given the last sentence, if Greenpeace believes that to be true one has to wonder when they’ll begin to self-censor.

Let freedom, scientific inquiry, honest debate and free speech ring.

Or join Greenpeace.

~McQ

Twitter: @McQandO


Economic Statistics for 19 Apr 12

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

Initial jobless claims were 386,000 last week, while the previous week’s claims were revised sharply upwards to 388,000. The four-week moving average of 374,750 is the highest since January.

The index of Leading Indicators rose 0.3% in March, a growth rate that could best be described as sustainable, though not robust.

Manufacturing growth slowed slightly in the Philadelphia Fed district, as the Fed Survey slipped to 8.5 from last month’s 12.5.

Existing home sales were worse than expected for March, with sales down -2.6% to a 4.48M annual rate. Sales are hampered by tight credit and a still sluggish labor market.

The Bloomberg Consumer Comfort Index rose to -31.4, tying the best reading since March, 2008.

~
Dale Franks
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Obesity in poor communities not linked to “food deserts”

I’m sure you remember a few years ago the LA City Council banned fast food joints from low income neighborhoods for a year.  The New York Times explains the reason they thought that was a function of government:

It has become an article of faith among some policy makers and advocates, including Michelle Obama, that poor urban neighborhoods are food deserts, bereft of fresh fruits and vegetables.

The purpose of the ban was to prevent more fast food from being made available in these poor neighborhoods that were considered “food deserts”.  The belief, and that’s all it is, was that the availability of fast food and the unavailability of “fresh fruits and vegetables” was a contributor to the obesity found in poor communities.

And the myth had its own narrative too:

Speaking in October on the South Side of Chicago, she said that in too many neighborhoods “if people want to buy a head of lettuce or salad or some fruit for their kid’s lunch, they have to take two or three buses, maybe pay for a taxicab, in order to do it.”

Except for the fact that two new studies say that’s just not true.

Both, using different methodology, came to the same conclusion:

Such neighborhoods not only have more fast food restaurants and convenience stores than more affluent ones, but more grocery stores, supermarkets and full-service restaurants, too. And there is no relationship between the type of food being sold in a neighborhood and obesity among its children and adolescents.

Within a couple of miles of almost any urban neighborhood, “you can get basically any type of food,” said Roland Sturm of the RAND Corporation, lead author of one of the studies. “Maybe we should call it a food swamp rather than a desert,” he said.

Indeed, it is, instead, choice at work.  And, as usual, government feels they should be involved in deciding which choices are made.  Now, it’s easy to say, “yeah, but it’s obesity and obesity isn’t good for you”.

Given.  But does that mean it is government’s job to intrude and attempt to remedy the situation with other people’s money?

Taking into consideration what the two studies have revealed, it seems, as is often the case, that government is barking up the wrong tree.   The myth, or if you prefer “article of faith”, seems to be wrong. Actual facts destroy the myth.  More than adequate supplies of fresh fruits and vegetables are readily available in poor neighborhoods.  The problem is the poor choose not to avail themselves of them.

So obesity among the poor isn’t the fault of “food deserts” (or a lack of food it seems) in poor communities and banning fast food joints and encouraging more grocery stores to locate there isn’t going to help ameliorate the problem.  Nor, apparently, is healthier food in schools.

Now what?

In fact, the only way to really impact obesity is to control choice isn’t it?  Dropping weight requires portion control, control of the type of food eaten and a certain level of exercise.

So what’s an intrusive and activist government to do now that their myth has been shattered?

~McQ

Twitter: @McQandO


Congress to mandate “black box” on all cars after 2015?

Yesterday I pointed to a piece of legislation that is in the House right now (after being passed by the Senate) which would give the IRS the power to confiscate your passport without judicial review and merely on the suspicion you owe a certain amount of back taxes.

Given the Orwellian name Moving Ahead for Progress in the 21st Century Act or MAP-21,  the legislation also mandates that all new cars have a “event data recorder” installed starting in 2015.

Now other than for government use, there are very few reasons why an owner of a vehicle would want such a device installed in his or her car.

The only reason an owner might want one was in case of an accident, it may provide some proof of their innocence in terms of fault.  But we’ve become quite sophisticated in accident investigation already and seem quite capable of determining that now without the aid of an onboard “event data recorder”.

Section 31406 of Senate Bill 1813 (known as MAP-21), calls for “Mandatory Event Data Recorders” to be installed in all new automobiles and legislates for civil penalties to be imposed against individuals for failing to do so.

“Not later than 180 days after the date of enactment of this Act, the Secretary shall revise part 563 of title 49, Code of Federal Regulations, to require, beginning with model year 2015, that new passenger motor vehicles sold in the United States be equipped with an event data recorder that meets the requirements under that part,” states the bill.

Nice.

Although the text of legislation states that such data would remain the property of the owner of the vehicle, the government would have the power to access it in a number of circumstances, including by court order, if the owner consents to make it available, and pursuant to an investigation or inspection conducted by the Secretary of Transportation.

And, one would assume, government access to such data would be expanded as government found additional reasons to want it.  Not to mention the addition of new “recording” devices or the like which might be even more intrusive in the future (if they manage to get away with this).  Like imposing a road use tax.  How handy would such a device be to government then?

This sort of government intrusion bothers the heck out of me.  Never mind that this mandate (along with new CAFÉ standards) will increase the cost of a new car, the real point is this is being done as something government desires, not the individual.  There’s no hew and cry or demand for such a device now.  This serves one constituency and one constituency only – government.

Additionally, it isn’t optional.  You have no choice but to pay for one if you buy a new car.  And you will most likely be prosecuted if you disable it.

These are the sorts of intrusions citizens ought to be fighting tooth and nail.  It isn’t the job of government to mandate recording devices on private vehicles.  If they want to have them installed on their vehicle fleets, that’s fine.

But not mine.  Not without my consent and damn sure not as a mandate with legal consequences for non-compliance.

There are now two reasons MAP-21 should be shot down in the House.

~McQ

Twitter: @McQandO


Scapegoating oil speculators–Obama counts on public’s economic ignorance to shift blame for high gas prices

Icould pretty much stop there and say the title tells you the story.  Obama knows high gas prices are not good for his re-election campaign.  He also knows his energy policies have actively worked against ameliorating or lowering the price of gas.

Therefore, it is necessary to find a scape-goat.  Someone or something he can shift the blame too and demonize.  In other words, the usual disingenuous attempt at distraction.

David Harsanyi explains what “speculators”, otherwise known as commodity traders, do:

Let’s start by being thankful for oil speculation — no matter what the motivation of those involved might be. To begin with, speculation allows companies with exposure to fluctuating commodity prices to hedge against rising costs by locking in. Sometimes the bet pays off; other times it doesn’t. But risk and profit are not yet crimes.

Oil speculation also offers consumers and investors information about the future that can help them make informed long-term decisions. Speculators trade commodities based on the information available in the marketplace. They reflect reality; they don’t create it.

But sometimes, unfortunate as it is, prices will rise. "Gouging," the close scaremongering cousin of "speculation," helps persuade consumers not to use what they don’t need. It incentivizes to modify behavior — our driving habits or the size of our cars. We conserve more when prices are higher, so we avoid shortages, and producers intensify their production. (Funny how Democrats get this concept when writing energy policy designed to artificially spike fossil fuel prices.)

In reality, this sort of trading helps moderate the market.  And, being a zero sum game – i.e. if you make money someone else loses it – it is done carefully.  As Harsanyi explains, they “reflect reality; they don’t create it”.  In essence you’re seeing a relatively free market work as it should.

Of course, what Barack Obama wants to do is have government intrude on that market because politically he doesn’t like the reality it is reflecting because it is politically damaging to him.  So:

Speaking from the Rose Garden, the president announced a proposal to spend $52 million to fund increased government oversight of oil futures market trading in addition to harsher civil and criminal penalties for manipulation in energy markets. “We can’t afford a situation where some speculators can reap millions, while millions of American families get the short end of the stick,” Obama said. “That’s not the way the market should work.”

Or, said another way, if you make a profit based on your foresight, you’d be considered a criminal.  If you lose money, I suppose, that’s ok in Obama’s world.

Of course, it’s all nonsense (I mean how would Mr. Obama regulate oil trading in foreign exchanges?).  It is a calculated attempt to use ignorance of how these markets work to cause voters to shift their rage from him to his designated target.  Successful scapegoating means one less issue the opposition has to use against him (not that he doesn’t provide a target rich environment anyway).  He’s counting on this sort of populism to work.

David Kruetzer asks some questions I’d like to see the press ask:

If speculators are making unconscionable profits on energy, why are they only doing it occasionally and not all the time? Why are there only speculators in oil, not natural gas (whose current price is about half of what it averaged over the last decade)? And given how the petroleum market works — for every speculator who makes money on a trade, somebody else will lose money — the president’s theory “requires an endless string of chumps to take the other side of the speculators’ deals.”

And Kreutzer points out the basics of any commodities market, again something of which Obama banks on your ignorance:

For speculation to drive up prices, the speculators must either cause oil production to slow down (which they haven’t) or to pull oil off the market. If the flow of petroleum and its products remains unchanged, the price at the pump will not change. If petroleum is pulled off the market, which can happen even though there are limits to what can be stored, it will eventually come back on the market.

The question becomes, ‘When the oil comes back on the market, is the price higher or lower than when it was pulled off the market?’ The price will only be higher if the amount supplied at that time is lower or the demand is higher. In either of those cases, speculators have helped moderate price fluctuations and will be rewarded with profits. If the price is lower, then the speculators did a bad thing and will be punished by losing money.

So those are the basics of the issue as it concerns such trades and markets.

As can plainly be seen, Obama hasn’t a leg to stand on.  But that doesn’t stop him from claiming that government is the answer to this made up problem. 

Why?  Well other that it is his political nature, he can’t sell the nonsense without some sort of “action”.   It becomes much more believable to those who don’t know better if he’s going to spend millions to regulate the contrived problem out of existence.

Of course he knows his actions will not have any positive effect on gas prices, and, in fact, may actually have a detrimental effect, which is why he couches this attempt at scapegoating the problem via government with “none of these steps by themselves will bring gas prices down overnight”.

But he can claim to be taking action while continuing to blame speculators for the problem and counting on general economic ignorance to carry the day for him. 

Pretty typical of the man, I’ve come to learn.

~McQ

Twitter: @McQandO


The GOP has a chance to take the White House if it can discipline itself to stay on message

Pew Research as a survey out today that is one taken after Romney became the presumptive nominee for the GOP.  It compares its numbers to a survey taken while the GOP’s nomination was still contested.

Pew entitles it’s piece about the survey, “With Voters Focused on Economy, Obama Lead Narrows”.  It subs it with “Social Issues Rank As Lowest Priorities”.

Hello out there GOP – are you reading this?  There’s your campaign.  What to stress.  What to avoid.

Any chance they’ll actually figure that out?

I mean so far we’ve talked about sluts, contraception, race, wars on women, stay at home moms, even about dogs riding on roofs (well at least the Romney’s didn’t eat the dog).

We’ve been distracted by the outrage of the week – Rush Limbaugh, Hillary Rosen, Ted Nugent, Bill Maher, etc. 

That’s the left’s game plan, for heaven sake – Obama has a dismal, in fact awful economic record.  Horrible.

And yet the GOP is walking into every distraction trap the left sets like they haven’t a clue.

As I’ve been saying for months, once the nomination is settled, regardless of who the nominee is, and the focus begins to turn on Obama and his record, there will begin a shift in voter preference that should (note the word) carry the GOP nominee to the White House -  if the GOP plays its cards right.

Should.

Here’s what I mean:

Obama’s lead over Romney has narrowed since last month, when he had a 12-point advantage, though it is comparable to margins from earlier this year. While Obama’s advantage has declined since March, there is little to suggest a specific problem or campaign event as having a critical effect.

While there have been debates over issues related to gender, the rise and fall in Obama’s support has largely crossed gender lines, with a fairly consistent gender gap over time. For example, since March, Obama’s support among both men and women has slipped five percentage points.

Independent voters remain up for grabs. In the current survey, 48% favor Romney while 42% back Obama. A month ago, it was 47% Obama, 44% Romney.

If anyone would not expect an incumbent president to have some sort of  lead at this point, I’d say you don’t know much about American politics.

That said, as you can see by the change in a month, the lead is at best tentative, soft and narrowing. 

But … there is still a way to absolutely screw up this chance at making Obama a one-term president and, unfortunately, I wouldn’t be surprised to see the GOP manage that.

That is, to concentrate on the wrong issues.  They have a track-record of snatching defeat from the jaws of victory doing exactly that.

I’ll make it as simple as possible.

Limit the main issues of the GOP campaign to three themes: the economy, jobs and the debt.  Talk about how to improve the first two and reduce the third.  Talk about getting the hell out of the way while giving business the green light to lead us out of this economic morass.  Declare the war on fossil fuel to be over.   Talk about exploiting our natural resources and the jobs that will bring.  Put confidence back in the business sector that expansion and hiring will be enabled and supported, not killed with more and more regulation.  Talk about repealing ObamaCare and draconian regulations.  Talk about bringing America back.

Once the incumbent has given his concession speech, talk about whatever else tickles your fancy then. But discipline yourself until then.  Until then narrow the focus and be relentlessly on message.  Refuse the distraction traps.  Just flat refuse them.

Do that and the GOP has a shot.  The numbers will continue to improve.

Fall into the distraction traps and kiss victory goodbye.  If the other side is allowed to frame the campaign and establish the narrative and avoid examining Obama’s record,  the GOP loses.

We’ll see which course they choose.

~McQ

Twitter: @McQandO


IRS to have power to confiscate passport?

Iguess we’ve moved into the realm of “guilty until you prove yourself innocent”:

The Republican House of Representatives may soon follow the Democratic Senate and give the IRS the power to confiscate your passport on mere suspicion of owing taxes. There’s no place like home, comrade.

‘America, Love It Or Leave It" might be an obsolete slogan if the "bipartisan transportation bill" that just passed the Senate is approved by the House and becomes law. Contained within the suspiciously titled "Moving Ahead for Progress in the 21st Century Act," or "MAP 21," is a provision that gives the Internal Revenue Service the power to keep U.S. citizens from leaving the country if it finds that they owe $50,000 or more in unpaid taxes — no court ruling necessary.

Note … “mere suspicion”.  Like the IRS screws up its audit and thinks you owe more than you do (and at least $50k), your passport is yanked without going to court.

Let freedom ring, eh?

And, as the lede points out, it isn’t just the Democrats.  Another attempt by both parties to shred the Constitution.

This is not the sort of power an unaccountable agency should be given.  Any idea of how many people will suddenly find themselves on the wrong end of a suspicion they owe $50k or more in taxes?  Whether true or not, with the power to grab your passport and only a suspicion needed (no court order), the IRS will likely “suspect” many people owe at least that much.

That’s certainly consistent with the history of such granted power. Go to the extreme quickly – there’s no reason not too.  No penalty for them, certainly.  Oh, you don’t owe $50k?  Here’s your passport. 

“Moving Ahead for Progress in the 21st Century”?

Since when is changing the IRS to a form of the KGB a “move ahead?”

~McQ

Twitter: @McQandO


Unemployment: The myth and the reality

And all of it brought to you in charts via Zero Hedge.

The myth:

4-15-12_OfficialUnemployment

The "official" unemployment rate is 8.2%. Zero Hedge claims the real unemployment rate is 14.8%.

The reality in two charts.  Chart 1:

4-15-12_NotInLaborForce

In case you’re missing the point, 88 million are not participating. That is a whole lot less than when this started. As Zero Hedge asks ‘must be that everyone is able to retire’. Uh, yeah, right.  That chart and number provides context for the next chart. 

Lets go to Chart 2.  This is the chart that tells the tale and kills the myth:

4-15-12_PercentAmericansWithJobs

This is the chart that the GOP nominee ought to have permanently hanging at every single event he holds during this election season.  This is indicative of the real unemployment picture and it isn’t pretty.

Certainly, many Baby Boomers are choosing to retire, but as I said on the podcast, a) we’re just getting into Baby Boomer retirements and b) no one would dare argue that everyone has the ability to retire right now.  So there is a serious discrepancy between the official unemployment rate and the real unemployment rate.  That discrepancy is evident with these charts and destroys the myth of an improving unemployment picture.

~McQ

Twitter: @McQandO


Economic Statistics for 17 Apr 12

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

Housing starts fell -5.8% to a lower than expected 654k annual rate. Building permits, however, rose 4.5% to 747k annual rate.

ICSC-Goldman Store Sales fell -1.0% in the latest week, and the Y/Y rate fell to 3.2%. Redbook, meanwhile, reports a similarly weak 3% Y/Y rate.

The Fed reports that industrial production was unchanged for the month, while capacity utilization dropped -0.1% to 78.6%. Manufacturing declined by -0.2% for the month.

~
Dale Franks
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