Monthly Archives: July 2012
Henry Blodget of Business Insider entitles his anti-Romney piece:
Sorry, Mitt Romney, You Can’t Be Chairman, CEO, And President Of A Company And Not Be Responsible For What It Does…
Really? Since when did that become true?
After all, according to our current President and the left, everything the last 4 years has been Bush’s fault. Or ATMs. Or tsunamis. Or Europe. Or …
The following statistics were released today on the state of the US economy:
Initial jobless claims fell 26,000 to 350,000 last week, mainly due to seasonal distortions in the Auto Industry. The 4-week moving average fell to 376,500. Continuing claims fell to 3.304 million.
Import prices for June followed May’s 1.0% decline by falling -1.7%, with a year-over-year rate of -2.1%. Export prices fell -2.7%, with a year-over-year rate of -2.6%.
The Bloomberg Consumer Comfort Index remained unchanged at 37.5 in the latest week.
Yesterday, as the Republican controlled House of Representatives voted for the 30th time to repeal ObamaCare, Nancy Pelosi said:
“We put forth a vision for the middle class to make health care a right, not a privilege for all Americans. Today, as they have done more than 30 times this Congress, Republicans will vote to take away that right.”
Pelosi, among many of our legislators and politicians in general, displays a level of ignorance about rights and privileges that seems pretty basic to me. Governments don’t grant rights, they grant privileges no matter how hard they try to characterize what they do as a “right”.
A right, to be a right, must be inherent. It is something you have even before government shows up. The right to life. The right to liberty. As our founders identified these rights, they’re “inalienable”.
The best government can do, and the true foundation of a just government, is the acknowledge and protect our inherent rights. I.e government should exist to protect those rights.
Real rights are passive. They don’t require the assets, time, labor or commitment of others to enable their execution. Health care, of course, is a perfect example of a pseudo“right” which requires all of that.
Anything that government can give you (remember, we had the inherent rights I talk about before government existed and we formed the government to acknowledge and protect them – see founding documents) is not a “right.” And when government has to use it’s coercive power to “enable” these pseudo “rights” as it has in this health insurance debacle, it isn’t a right.
There is no right to health care. Period. There never has been. You have no inherent right to demand someone else use their skills, time and assets to service your health. You certainly have the right to negotiate and reach a voluntary agreement (see liberty) with health care providers based on a mutual exchange of value (see property). But “right” – no.
And besides, what Pelosi et al really cranked out was a requirement to buy health insurance via the coercive taxing authority of government. It no more guarantees health care as a right than the previous system. You still have to find a health care provider to accept your insurance and agree to treat you. In fact, it’s even tough to characterize the ObamaCare monstrosity as a government granted “privilege”.
Back to the point – this fundamental ignorance about rights and privileges, however, is at the root of many of our problems. For decades we’ve allowed government to get away with calling things it grants “rights” to the point that the concept of rights is so muddled that most people don’t understand them at all and have fallen for the government line.
Falling for that line helps enable horrific legislation like ObamaCare because it gives it cover, a veneer of "good” the proponents use to push their agenda. Who wouldn’t be for something that’s a “right”?
My point: Don’t let them misuse the word. Call people and politicians who do this out. Make them substantiate their claim of a right and when they can’t point out what is really going on. They’re talking about a privilege established by government coercion. That’s not freedom. That’s not liberty, two things you have a right to expect and something these privileges usually curtail.
It’s time to take back the political language. And there’s no better place to start with the understanding that government’s don’t and can’t grant rights.
The following statistics were released today on the state of the US economy:
In May, the U.S. trade gap shrank to $48.7 billion from a revised $50.6 billion in April, primarily on falling oil prices.
Wholesale inventories rose 0.3% in May, well above a -0.8% decline in sales at the wholesale level. The stock to sales ratio rose to 1.18.
MBA Purchase applications fell -2.1% in the latest week, with purchase apps rising 3.0% and re-finance apps falling -3.0%.
Here’s why I fear government. It is a small, seemingly insignificant story in the big scheme of things, but in reality it points to a power that should simply not be allowed for government to possess.
Tweak of a regulation, stroke of a pen and a small industry is “snuffed out”:
A tiny amendment buried in the federal transportation bill to be signed today by President Barack Obama will put operators of roll-your-own cigarette operations in Las Vegas and nationwide out of business at midnight.
Robert Weissen, with his brothers and other partners, own nine Sin City Cigarette Factory locations in Southern Nevada, including six in Las Vegas, and one in Hawaii. He said when the bill is signed their only choice is to turn off their 20 RYO Filling Station machines and lay off more than 40 employees.
The machines are used by customers who buy loose tobacco and paper tubes from the shop and then turn out a carton of finished cigarettes in as little as 10 minutes, often varying the blend to suit their taste. Savings are substantial – at $23 per carton, half the cost of a name-brand smoke – in part because loose tobacco is taxed at a lower rate.
"These cigarettes are different because there are benefits in saving money and in how they make you feel," said Amy Hinds, a partner who operates the Sin City Cigarette Factory at Craig and Decatur.
"These cigarettes don’t have any of the chemicals in them, and the papers are chemical-free, unlike the cartons people buy from Philip Morris."
But a few paragraphs added to the transportation bill changed the definition of a cigarette manufacturer to cover thousands of roll-your-own operations nationwide. The move, backed by major tobacco companies, is aimed at boosting tax revenues.
Faced with regulation costs that could run to hundreds of thousands of dollars, RYO machine owners nationwide are shutting down more than 1,000 of the $36,000 machines.
And who offered this “tiny amendment”?
"The man who pushed for this bill is Sen. (Max) Baucus from Montana, and he received donations from Altria, a parent company of Philip Morris. Interestingly enough, there are also no RYO machines in the state of Montana. It really makes me question the morals and values of our elected speakers."
Or “what freaking business is it of Max Baucus? How does it effect him or his state?
More freedom, more choice up in smoke. The problem, of course, is the cigarette industry is an unpopular industry. But it begs the question, if it can do this to a business we don’t particularly care for, there’s absolutely no reason it can’t do the same thing to one we do care for. As it has been said many times, “a government strong enough to give you things is also strong enough to take them away”. And here it is taking away a choice for consumers because it disapproves of the product.
And there’s also a very big hint of crony capitalism (Max Baucus, who has none of the businesses in his state but receives donations from Altria? Yeah, nothing suspicious there).
This reminds me of the arguments for the 1st Amendment. The test isn’t with speech with which you agree, it is instead protecting speech with which you completely and utterly disagree. It is with speech so vile you’d prefer to shut them up but know if you do, then you’ve given others permission to shut you up.
I don’t smoke but I’ll defend to the death your right to smoke, as long as you don’t violate any of my rights by doing so.
But Big Government – yeah, no way.
President Obama is on his newest attempt to change the subject and find something to take to the people that might interest them and distract from his abysmal economic performance. It’s taxes. Specifically, he’s decided to make an issue of the automatic tax increases that will take effect in January and claim he does not want to see taxes increase on anyone but those nasty rich who need to “pay their fair share”. Or, back to class warfare.
A) He likes to refer to these as the “Bush tax cuts”. In fact, they’re the current tax rate. Have been for years. What he wants to do is see a tax increase on the rich, but no one else. I’m not sure how else one characterizes that but “class warfare”, especially given the percentage of total taxes that top income group pays already.
B) Republicans are saying no tax increases on anyone. Democrats like to characterize that as protecting the rich. I like to characterize it as an attempt to address the real problem – out of control government spending.
C) The nasty “rich” Obama wants to tax also include almost a million small businesses. That’s one of the primary reasons, in this weakening economy, that Republicans are right not to agree to any tax increases. It is both stupid and economically suicidal. But then you have to know about economics and the business world to understand that.
D) Democrats had two years of a complete monopoly on government to get this done and didn’t. It’s not the Republicans who have prevented anything. It is total incompetence on the Democratic side of the aisle. And, as Obama’s favorite pastor likes to say, “those chickens are coming home to roost”.
E) Finally, Barack Obama has already raised taxes on the middle class despite his statement in a speech yesterday claiming he had no desire to raise middle class taxes.
The tax is called the mandate in ObamaCare. It goes like this:
75% of the mandate tax falls on the middle class. That is a middle class tax hike in anyone’s book.
So when he claims he has no desire to raise the taxes on the middle class, that may be true … now. Because, in fact, he’s already done it.
Today kicks off the week’s statistics on the state of the US economy:
The NFIB Small Business Optimism Index fell 3 full points in June to 91.4, a "significant" decline that reverses year-to-date improvement. The report highlights a weak labor sector, with job creation contracting for the first time this year. Also in decline were capital investment plans, earnings trends, and special weakness in consumer spending—especially on services.
In retail sales, Redbook reports year-over-year store sales were unchanged at a weak 2.2%. Conversely, ICSC-Goldman shows retail sales strength, with comparable store sales rose 2.0% for the week, and were up 3.0% over last year.
E. J. Dionne, naturally, makes an effort today in the WaPo to do exactly that. Speaking of Obama and Democrats in Ohio and Colorado, he talks indirectly about the auto bailout:
None of this surprises Sen. Brown, a proud pro-union liberal who campaigned with Obama in Ohio last week. Brown notes that Obama has gained ground in his state both by being tough in enforcing trade rules on behalf of American companies and by pursuing a “high-end manufacturing strategy” that appeals to the nation’s “historical pride in manufacturing, and in making things.”
For Brown, who faces reelection this year, one of the voters he keeps in mind is the “guy in Zanesville who made big things with his hands and now has gone from $17 an hour to $11 an hour.”
The candidate who speaks to voters like Brown’s Zanesville worker — and to his white-collar equivalent in Colorado — is likely to win the election. Mitt Romney hopes the national unemployment rate will get them to vote Republican. Obama’s challenge is to offer an economics of national pride and renewal that answers the sense of betrayal these voters began feeling long before he took office.
That outlines some of the problem the Obama record has. Of course, unspoken here is the auto bailout and how that effected workers. The implication is the bailout was a net positive. Of course Obama, et al, think that workers will reward him for that move.
But the entire record of the auto bailout on the left has been one of spin. And most of that spin has been about as disingenuous as one can imagine. Even Dionne creeps around it by mentioning that the workers took a haircut in average salary (well, at least for new workers).
However, the assumption is that’s the worst that happened (hey, at least they still have a job) and workers will be grateful. Or, business as usual, a politician used taxpayer money and debt to buy votes, you have a problem with that?
Well yes, I do.
In fact, the auto bailout is a case study in crony capitalism. It is a situation where government interfered and overruled normal bankruptcy procedures, reorganized the payback priorities so debt holders were stiffed, bought up the majority of the stock in the new company (GM) and handed much of the control to a favored constituency (labor).
Then they told an absolute lie (GM has paid back its debt) and have consistently pretended that all is well with the company when it is not. This is the real result of the bailout:
General Motors (GM) shares fell to a fresh 2012 closing low of 19.57 on Monday. The stock hit 19 in mid-December, the lowest since the auto giant came public at $33 in November 2010 following its June 2009 bankruptcy.
Normally you might say, tough luck investors. But this is Government Motors. The Treasury still owns 26.5% of GM, or 500 million shares. Taxpayers are still out $26.4 billion in direct aid. Shares would have to hit $53 for the government to break even.
Those shares were worth about $9.8 billion as of Monday. That would leave taxpayers with a loss of $16.6 billion.
But that’s not the full tally. Obama let GM keep $45 billion in past losses to offset future profits. Those are usually wiped out or slashed, along with debts, in bankruptcy. But the administration essentially gifted $45 billion in write-offs (book value $18 billion) to GM. So when GM earned a $7.6 billion profit in 2011 (more on that below), it paid no taxes.
Include that $18 billion gift, and taxpayers’ true loss climbs to nearly $35 billion.
So that’s ground truth on where GM stands today. But that’s not helpful to Obama, is it? So how can Obama and company make this picture seem a little brighter? Well good old crony capitalism, that’s how. We have the end of the 2nd quarter nearing and it is critical to the spin of how well GM is doing to see good 2nd quarter results, no?
The upcoming earnings announcement by GM is, politically, the most important to date. The pressure is on Government Motors to appear financially strong as this may be the last earnings report before November elections and sets the stage for how "successful" GM is.
Well guess who is buying GM vehicles in huge quantities (HT: Steve)?
We now learn that government purchases of GM vehicles rose a whopping 79% in June.
The discovery of the pick-up in government fleet purchases at the taxpayers’ expense comes just weeks before GM announces its second quarter earnings. Overall fleet sales (which are typically less profitable than retail sales) at Government Motors rose a full 36% for the month, helping to drive decent sales improvements year over year.
Wow. What a surprise. Add a few accounting gimmicks:
One of GM’s past tricks to help fudge earnings numbers has been to stuff truck inventory channels. Old habits die hard at GM. According to a Bloomberg report, "GM said inventory of its full-size pickups, which will be refreshed next year, climbed to 238,194 at the end of June, a 135 days supply, up from 116 days at the end of May." 135 days supply is huge, the accepted norm is a 60 day supply. The trick here is that GM records revenue when vehicles go into dealership inventories, not when actually sold to consumers.
And you’re likely to see a “good” earnings report even when the stock is at an all time low, inventories are huge and crony capitalism instead of real sales is the means of spinning the news in a positive direction.
Remember that when you hear the GM “success story”.
I continue to hear the left bravely or blindly asserting that Obama’s fine and will pull off re-election with relative ease. I even hear that on the right from some.
My political gut says no. It’ll be close. No one is really that enamored with Mitt Romney. However, in the end, it will be Romney.
Why do I speak with such apparent certainty? Well, as I’ve mentioned in the past, there are certain types of polls I keep an eye on. They could be characterized as “temperature” polls I guess as in taking the temperature of the nation. Direction of the country is one I like to watch. Here’s another for example:
Two-thirds of likely voters say President Obama has kept his 2008 campaign promise to change America — but it’s changed for the worse, according to a sizable majority.
A new poll for The Hill found 56 percent of likely voters believe Obama’s first term has transformed the nation in a negative way, compared to 35 percent who believe the country has changed for the better under his leadership.
The results signal broad voter unease with the direction the nation has taken under Obama’s leadership and present a major challenge for the incumbent Democrat as he seeks reelection this fall.
Two points. One the poll is of “likely voters” which is a much stronger and accurate demographic than “registered voters”. Secondly, the 35% of satisfied likely voters pretty much mirrors the percentage of Democrats in the US. What that says to me is independents are overwhelmingly dissatisfied with the president.
That’s not good news for the Obama campaign.
Then there is enthusiasm, something we talk about because it is an intangible that is critical to any election. It is critical to any GOTV effort. Those that are more enthusiastic about the election for whatever reason (love their candidate, don’t like the other candidate, etc.) are more likely to make the effort to vote and be receptive to a GOTV effort.
That too seems to be running against Obama:
Independent of voter opinions about how the country has changed, The Hill Poll found an overwhelming majority of voters — 89 percent — view the choice between Obama and Romney as important in terms of the future impact on the country.
Almost half (47 percent) say they are paying more attention to this year’s election than the 2008 vote. Republicans are generally paying more attention than Democrats — 56 percent to 44 percent — to the 2012 campaign compared to 2008.
The Hill, which conducted the poll, wants you to believe that independents, which they also identify as “centrists”, are pretty evenly split over the two candidates. But their 56/35 finding doesn’t support that assertion.
People are not happy with the current situation in the country (with good reason) and for the most part think 4 years is enough time to change it if a president is capable of doing so. It hasn’t happened. In fact, for at least 14.9% of the working population it has gotten worse (as reflected in the U6 unemployment/underemployment number).
That’s a huge number.
What Obama doesn’t have going for him this time is a ground swell of naiveté that bought into the nebulous “hope and change” mantra. He most likely won’t have the youth turnout he had (enthusiasm down badly). He very likely won’t have the squishy Republican vote (the Peggy Noonan vote) he had last time. The “white guilt” vote has, for the most part, been assuaged. A black president was elected and got his chance. Add those in with his loss of the independent or swing voters, and the margins become very thin.
Obviously the swing states, as usual, will determine the outcome. But even in the swing states, the margins are razor thin (with Romney leading in many), and that, again, is not a good sign for an incumbent four months out.
This particular temperature check seems to bolster the political gut feeling (a collection of such temperature checks and other rumblings here and there) that this is an incumbent in deep trouble and probably doesn’t yet know the extent of it.
When emphasis is turned on to his record, my guess is the numbers get worse … for him.
For the second Sunday in a row, our boxer, Apollo, got loose and attacked Lucius. This time, he got life-threatening injuries from Lucius, who is twice his size, and Apollo had to go into emergency surgery. We had been keeping them separated since last week, but Apollo got loose and went straight for Lucius again.
So, not only do we have to pay about $1600 in vet bills today, we now have to find a new home for Apollo. We can’t have a dog-aggressive dog in the house, no matter how much we love him. And we love him to death.
The vet was a nightmare as well. It was our 1st time there, but we went because they had emergency care on Sundays, and they are much, much closer than the other animal hospital. All I’ll say about that is that we hate them and will never go back to them. The only reason Apollo is still there is because his injuries were so bad, we couldn’t take him to the other animal hospital without endangering his life. We will be going to our regular vet for the post-op checkups.
This is one of the worst days ever.
UPDATE: We changed our mind. Rather than try to get rid of Apollo, we’ve decided to change the other side of the equation and find a new home for Lucius. I suspect it’ll be a lot easier selling an intact, pure-bred, registered Cane Corso male than it will be to find someone who wants an older boxer with impulse control issues. Lucius will be better off as the king of his own castle anyway.