Monthly Archives: September 2012
Here’s how markets work. From Toyota:
It said today it will not release its proposed mass-market mini e-car, the eQ. The reason: there’s no demand for it, not while battery technology is failing to provide comparable range to a tank of petrol. The natural gas boom in the US has seen prices of the fuel plummet, in turn reducing the cost of electricity generated by burning it. The Japanese car maker said today it will release 21 hybrid gas-electric models in its line-up by 2015.
“The current capabilities of electric vehicles do not meet society’s needs, whether it may be the distance the cars can run, or the costs, or how it takes a long time to charge,” said, Uchiyamada, who spearheaded Toyota’s development of the Prius hybrid in the 1990s.
Here’s the market not working because of government intrusion (and ownership):
Nearly two years after the introduction of the path-breaking plug-in hybrid, GM is still losing as much as $49,000 on each Volt it builds, according to estimates provided to Reuters by industry analysts and manufacturing experts.
Cheap Volt lease offers meant to drive more customers to Chevy showrooms this summer may have pushed that loss even higher. There are some Americans paying just $5,050 to drive around for two years in a vehicle that cost as much as $89,000 to produce.
It currently costs GM “at least” $75,000 to build the Volt, including development costs, Munro said. That’s nearly twice the base price of the Volt before a $7,500 federal tax credit provided as part ofPresident Barack Obama‘s green energy policy.
A pity these things have to be continually pointed out. But, of course, it won’t stop those who want government to decide what we should be driving instead of consumers and think subsidies will foster that desired behavior.
Two non-partisan government agencies — the Congressional Budget Office in Washington, D.C. and Parliament’s Select Transport Committee — conclude that during the next decade at least, the giveaways will have little impact on sales of plug-in hybrid and all-electric vehicles, or on gasoline consumption and greenhouse-gas emissions. Their main beneficiaries: affluent purchasers who’d buy the vehicles anyway.
“… during the next decade at least …?” Love that caveat, don’t you? They never work if it is something consumers don’t want. See current example for proof. In the case of the market, it’s moved on … and much faster than government can react. As usual, government has backed a loser.
The frenzy over shale gas deep under Ohio and other states has the makings of a different kind of rush on the nation’s highways. Businesses, cities, metropolitan transit systems and even school districts across the nation are edging toward a switch from diesel and gasoline to natural gas. Converting cars and light trucks to use either gasoline or natural gas is expensive. And heavy trucks designed specifically for natural gas also cost more than conventional diesels. But at current prices, engines that can run on natural gas cut fuel bills in half or better.
And GM has the Volt. You have to laugh at the fact that the central planners invariably always get it wrong.
You’d have think we’d have learned that by now, wouldn’t you?
The following US economic statistics were announced today:
The Dallas Fed general business activity index improved but remained in negative territory, posting at –0.9 versus –1.6 in August. Production, however, jumped to 10.0 from 6.4 while new orders rose to 5.3 from 0.2, both pointing to future improvements in Texas business conditions.
The Chicago Fed National Activity Index fell to -0.87 in August from a revised -0.12 in July. This pulled the 3-month average deeper into contractionary territory, with the average falling to –0.47 from –0.26.
Thomas Sowell, as he often does, puts the blue state model’s deficiencies into perspective in an easily understandable article. In this case he addresses redistribution. If honest, even the most rabid redistributionist should come away from reading it understanding how redistribution is a doomed scheme.
Why? For the same reason most blue state ideas fail. They run counter to human nature. In fact, they naively believe they can do something counter to human nature and it will both work and be sustainable.
Redistribution has been something tried among many nations in the past. And, it has pretty much failed each and every time. Again the quesiton: “why”?
Those who talk glibly about redistribution often act as if people are just inert objects that can be placed here and there, like pieces on a chess board, to carry out some grand design.
But if human beings have their own responses to government policies, then we cannot blithely assume that government policies will have the effect intended.
Bingo. While such schemes may work initially, they never factor in the reaction of human beings to something they find disagreeable, dishonest or just plain wrong. Politician who want to tax things to change behavior find this out all the time. But apparently we have to learn these lessons over and over and over again. Throughout history, schemes which run counter to human nature rarely if ever succeed over any extended period of time. There’s a reason for that:
In theory, confiscating the wealth of the more successful people ought to make the rest of the society more prosperous. But when the Soviet Union confiscated the wealth of successful farmers, food became scarce. As many people died of starvation under Stalin in the 1930s as died in Hitler’s Holocaust in the 1940s.
How can that be? It is not complicated. You can only confiscate the wealth that exists at a given moment. You cannot confiscate future wealth — and that future wealth is less likely to be produced when people see that it is going to be confiscated.
This would seem a simple lesson, given the amount of history in which it has been proven. Yet, for whatever reason, politicians on the left (and many on the right) seem to discover it afresh in each generation. That and the belief that the only reason it hasn’t worked in the past is because they weren’t in charge of its implementation.
We have one of those in office now. For the “smartest guy in the room”, he has yet to understand how human nature works in this regard.
All I can say is if he’s unable to wrap his head around the consequences of pursuing such a policy and is still considered the “smartest man in the room”, it must be an awfully small (and empty) room.
This week, Bruce, Michael, and Dale talk about the election.
The direct link to the podcast can be found here.
As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here. For podcasts from 2005 to 2010, they can be accessed through the RSS Archive Feed.
Sometimes it takes Charles Krauthammer to succinctly put matters in perspective:
It’s now three years since the Cairo speech. Look around. The Islamic world is convulsed with an explosion of anti-Americanism. From Tunisia to Lebanon, American schools, businesses and diplomatic facilities set ablaze. A U.S. ambassador and three others murdered in Benghazi. The black flag of Salafism, of which al-Qaeda is a prominent element, raised over our embassies in Tunisia, Egypt, Yemen and Sudan.
The administration, staggered and confused, blames it all on a 14-minute trailer for a film no one has seen and may not even exist.
What else can it say? Admit that its doctrinal premises were supremely naive and its policies deeply corrosive to American influence?
Can’t do that. This is his “strong point”. Foreign policy. How are we perceived in the world right now? Well as Mitt Romney quoted Henry Kissinger when asked the same question “Veak!”
Again we go back to human nature, especially as it concerns the behavior of nations. Like it or not, “international laws” and “governing bodies” and all, the world is, in effect, anarchy. We’re all born into national groups or some might even say gangs. And, like all disparate groups, the strongest ones run the place.
Apparently Barack Obama thought that was a bad thing, or at least bad if the US was the one doing so, so he essentially apologized, had America step back from prominent leadership and a position of strength to the new doctrine of “leading from behind”, and these past few weeks have been the result.
The administration’s excuse (because it’s always someone else’s fault)? A 14 minute movie trailer made by a Coptic Christian. That’s it. That’s why it happened.
Sovereign U.S. territory is breached and U.S. interests are burned. And what is the official response? One administration denunciation after another — of a movie trailer! A request to Google to “review” the trailer’s presence on YouTube. And a sheriff’s deputies’ midnight “voluntary interview” with the suspected filmmaker. This in the land of the First Amendment.
What else can Obama do? At their convention, Democrats endlessly congratulated themselves on their one foreign policy success: killing Osama bin Laden. A week later, the Salafist flag flies over four American embassies, even as the mob chants, “Obama, Obama, there are still a billion Osamas.”
A foreign policy in epic collapse. And, by the way, Vladimir Putin just expelled the U.S. Agency for International Development from Russia. Another thank you from another recipient of another grand Obama “reset.”
But it’s all about a movie, isn’t it?
Because it couldn’t be about epic incompetence and criminal naivety, could it?
Gee, I wonder if they’ve figured out they’re being a little too obvious about it?
Yeah, probably not. They have “3 layers of editors” after all.
Now there are those out there that say, much like voter fraud, there’s really no bias in the media, they’re professionals.
Well, we may call them that, but that doesn’t make them professionals.
More importantly, much like voter fraud and a myriad other things, it ignores human nature.
What there’s been in the past, for the most part, is plausible deniability. It just wasn’t obvious or if it was, it was arguable. Now?
Well now it is really hardly arguable anymore. Treatment of recent events brings that into startling focus. Yesterday on QandO Facebook, we linked to an article that listed 6 plausible headlines if Obama was a Republican president.
And yes, they’re quite plausible. In fact, I think that it is almost inarguable.
As interesting as the first graph above is, the second it telling in another way:
How is it telling? Well, who is the most satisfied demographic? 18 points higher than the average in the above of those who are a great deal or fairly satisfied with the media. And, as expected, at least if you follow the news media at all, the GOP is horribly dissatisfied. In fact 74% have little or no trust in the media.
But that’s not the important story in that graph. It’s the slide of the independent voter from a postion of trust to one of distrust. A 21% drop from 2001 to now.
It is that demographic’s distrust that best tells the story. They really have no dog in the hunt in terms of strong ideology. Their claim is they vote the candidate that best represents them at the time. So if anyone’s view is less tainted by ideology or concern, it would be independents. And they’ve shown a marked downward trend in trust for the media.
The point? Well the point may be that the media’s best biased efforts may not pay off quite as well as they hope or they’ve enjoyed in the past.
One of the reasons is there are a multitude of other sources out there that are readily available and help point out the half-truths and spin that is seen quite often in media reports these days. It also says, at least to me, that such sources are being both sought out and believed (if the independent number has any validity at all).
On a broad level, Americans’ high level of distrust in the media poses a challenge to democracy and to creating a fully engaged citizenry. Media sources must clearly do more to earn the trust of Americans, the majority of whom see the media as biased one way or the other. At the same time, there is an opportunity for others outside the “mass media” to serve as information sources that Americans do trust.
That’s precisely what is happening. The media monopoly has gone the way of feudalism. The digital printing press has seen to that. The problem is, the media, for all their self-lauding and claims of being “professionals” haven’t yet caught on to the fact that they’re fast becoming the equivalent of the buggy whip in an automotive society.
And it’s their fault.
That’s when, if he wins, Obama promises to be “more flexible”:
The Obama administration is weighing the release of blind Sheik Omar Abdel-Rahman — the spiritual adviser to the 1993 World Trade Center bombers — in a stunning goodwill gesture toward Egypt that has touched off a political firestorm, officials said yesterday.
The Egyptian government “asked for his release,” an administration source told The Post — and Rep. Peter King (R-LI) confirmed the request is being considered.
The White House, State Department and Justice Department each issued statements denying any deal is in the works, but, “There’s no way to believe anything they say,” said Andrew McCarthy, the former assistant US attorney who prosecuted Abdel-Rahman. “I believe there may already be a nod-and-wink agreement in place.” Abdel-Rahman, 74, was convicted in 1995 of plotting terror attacks throughout the city and is locked away in the medical wing of the Butner Federal Correctional Institution in North Carolina.
That would rock the house, wouldn’t it? Wonder what the Egyptians are promising … not to attack the Embassy anymore? Or to at least try to protect it?
This crew in the White House really needs to go home in a few months.
Primarily it is about attitude. And that additude translates into action. Forget the words they mumble, consider what they do.
Sometimes, though, the words tumble out and give you a real peek behind the mask. UN Secretary General Ban Ki Moon did some mumbling the other day which is a prime indicator of why the UN is both a disgrace and a threat to freedom. He spoke about “freedom of speech”. And, apparently learning from Obama, he tries to have it both ways, but in the end it is clear he really doesn’t consider speech a “freedom” or a “right” so much as a privilege that he and others like him get to define and limit:
“Freedoms of expression should be and must be guaranteed and protected, when they are used for common justice, common purpose,” Ban told a news conference.
“When some people use this freedom of expression to provoke or humiliate some others’ values and beliefs, then this cannot be protected in such a way.”
“My position is that freedom of expression, while it is a fundamental right and privilege, should not be abused by such people, by such a disgraceful and shameful act,” he said.
Note all the caveats and conditions. Who gets to define “abuse”? Where did this right not to be humiliated come from? And since when does that pseudo “right” trump freedom of speech?
I’ll tell you when – when despots so decide it does, that’s when.
And the UN is a collection of despots seeking power, which, thankfully, been mostly denied over it’s history. But in this topsy-turvy world, I wouldn’t be surprised to see them gather more and more over time.
The only person in this scenario who should be disgraced and ashamed is the UN’s Secretary General after those disgusting thoughts were uttered.
The more I watch the utter nonsense that’s going on in this country and the world these days, the more I begin to think that Orwell just missed it by a few decades.
The following US economic statistics were announced today:
The general business conditions index of the Philadelphia Fed’s Business Outlook Survey improved to –1.9 for its September reading versus minus –7.1 in August. The improvement comes mainly from a big jump in new orders.
Initial jobless claims for last week were down 3,000 to 382,000, though this "drop" is mainly an artifact of last week’s number being revised upwards by 3,000. The 4-week average rose 2,000 to 377,750. Continuing claims fell 32,000 to 3.272 million.
The Markit PMI manufacturing flash index for September fell very slightly, down –0.4 points to 51.5, as factory activity continues to grow modestly.
The Bloomberg Consumer Comfort Index rose to –40.8 from last week’s –42.2, continuing a long, slow, less negative trend.
The Conference Board’s index of leading indicators in July fell –0.1%, following last month’s rise of 0.4%, but still the third decline in the past five months.
So, heaven forbid, there’s a “secret video” out of Romney (provided, reportedly, by James Earl Carter IV, who, ironically, is out of work) saying things that show what he really feels about Americans, (insert gasp here) etc., etc., – que the liberal outrage of the week and the latest in the left’s distract and disrupt campaign.
As to the remarks videoed by someone at this event, here’s how Mother Jones characterized what it saw as the big 3 quotes (that, one assumes, hurts Romney).
On the 47 percent of Americans “who will vote for the president no matter what.”
On the dividends of his anticipated November 6 victory: “we’ll see—without actually doing anything—we’ll actually get a boost in the economy.”
On the “almost unthinkable prospects” for Mideast peace: “I look at the Palestinians not wanting to see peace anyway…and I say there’s just no way.”
Oh my. Romney thinks that are “47% ” of Americans who will vote for Obama, “no matter what”.
Well here’s a shocker — so do I. Are they the same 47% who pay not income taxes (and save your breath, all those who beam in with payroll and sales taxes – “income” is before “taxes” because we’re talking about a specific tax, thankyouverymuch). No. But that’s sort of irrelevant. I do indeed believe that around 47% will indeed vote for Obama “no matter what”. Just as I believe there is about 45% who will vote for Romney, “no matter what”. Shock! The political term “yellow dog” is applied to both sides, folks, for a very good reason. They exist – in large quantities.
Of course the war is for the final 8% isn’t it? It always is. Why anyone is outraged by this number and his point is beyond me … or anyone who has any freaking idea of how politics have worked in this country for ages. It’s always been about wooing the final 8-10%. Obama’s problem is, since being elected, he’s rarely if ever been beyond 49%.
As to the damage? Well I think James Taranto sums that up pretty darn well:
Romney’s comment has been compared with Obama’s infamous 2008 remark, also at a private meeting with donors, about Pennsylvania voters who get bitter and cling to guns and religion. To our mind the difference is that those people, traditionally Democratic voters, could easily tell that Obama was referring to them. Most of the 47% will not see themselves in Romney’s description–and those who do, would probably not have considered voting for him anyway.
Bingo. Not that the Democratic dog isn’t going to worry this bone as much as it can.
Quote two about the economy. Context is always nice:
Audience member: When the [unintelligible] in September, the markets are going to be looking—marginal tax rates going up, overheads going, fine, but sequestration under the debt ceiling deal—what do they call it?
Audience member: Yeah, they call it that. The Obamacare, taxes on dividends and capital gains—I mean, the markets are going to be speaking very wildly in October on all of those issues.
Romney: They’ll probably be looking at what the polls are saying. If it looks like I’m going to win, the markets will be happy. If it looks like the president’s going to win, the markets should not be terribly happy. It depends, of course, which markets you’re talking about, which types of commodities and so forth, but my own view is, if we win on November 6th there will be a great deal of optimism about the future of this country. We’ll see capital come back, and we’ll see—without actually doing anything—we’ll actually get a boost in the economy. If the president gets reelected, I don’t know what will happen. I can never predict what the markets will do. Sometimes it does the exact opposite of what I would have expected. But my own view is that if we get the—the “Taxageddon,” as they call it, January 1st, with this president, and with a Congress that can’t work together, it really is frightening, really frightening in my view.
Again, an “oh, my … wait, what?” You mean he wasn’t talking about the economy improving and him being able to take credit “without actually doing something” as implied by the out of context quote?
Context – what a concept. He’s talking about how the markets will react to his election, that’s all. And, as in the previous quote – he’s right.
Finally, the Palestinian question. He’s three for three – they don’t want peace, they want the destruction of Israel and always have. And when offered a 95% deal, their leader (another Nobel Peace Prize winner) Yassir Arafat, turned it down. These are the people who parade their children around in fake suicide vests and launch rockets, weekly, into Israel.
As to what he said in full:
And I look at the Palestinians not wanting to see peace anyway, for political purposes, committed to the destruction and elimination of Israel, and these thorny issues, and I say there’s just no way. And so what you do is you say you move things along the best way you can. You hope for some degree of stability, but you recognize that it’s going to remain an unsolved problem. I mean, we look at that in China and Taiwan. All right, we have a potentially volatile situation, but we sort of live with it. And we kick the ball down the field and hope that ultimately, somehow, something will happen and resolve. We don’t go to war to try and resolve it.
On the other hand, I got a call from a former secretary of state—and I won’t mention which one it was—but this individual said to me, “You know, I think there’s a prospect for a settlement between the Palestinians and the Israelis after the Palestinian elections.” I said, “Really?” And his answer was, “Yes, I think there’s some prospect.” And I didn’t delve into it but you know, I always keep open the idea of, I have to tell ya, the idea of pushing on the Israelis?—to give something up, to get the Palestinians to act, is the worst idea in the world. We have done that time and time and time again. It does not work. So, the only answer is show your strength. Again, American strength, American resolve, as the Palestinians someday reach the point where they want peace more than we’re trying to push peace on them—and then it’s worth having the discussion. Until then, it’s just wishful thinking.
Can’t disagree. Won’t disagree. It’s essentially true. When, and only when, the Palestinians get serious about real peace can such a process go forward. They’re still not there. In fact, they’re not even close.
Anyway, there you go. The outrage is just nonsense as usual, but certainly helpful in the disrupt and distract campagin. Not reported on? This part of the conversation:
Audience member: The debates are gonna be coming, and I hope at the right moment you can turn to President Obama, look at the American people, and say, “If you vote to reelect President Obama, you’re voting to bankrupt the United States.” I hope you keep that in your quiver because that’s what gonna happen. And I think it’s going to be very effective. Just wanted to give you that.
Romney: Yeah, it’s interesting…the former head of Goldman Sachs, John Whitehead, was also the former head of the New York Federal Reserve. And I met with him, and he said as soon as the Fed stops buying all the debt that we’re issuing—which they’ve been doing, the Fed’s buying like three-quarters of the debt that America issues. He said, once that’s over, he said we’re going to have a failed Treasury auction, interest rates are going to have to go up. We’re living in this borrowed fantasy world, where the government keeps on borrowing money. You know, we borrow this extra trillion a year, we wonder who’s loaning us the trillion? The Chinese aren’t loaning us anymore. The Russians aren’t loaning it to us anymore. So who’s giving us the trillion? And the answer is we’re just making it up. The Federal Reserve is just taking it and saying, “Here, we’re giving it.’ It’s just made up money, and this does not augur well for our economic future.
You know, some of these things are complex enough it’s not easy for people to understand, but your point of saying, bankruptcy usually concentrates the mind. Yeah, George.
Audience member, “George”: Governor, to your point on complexity. How is—you’ve traveled around America and talked to people in larger groups and perhaps people with different backgrounds, and people in this room: To what extent do people really understand that we’re hurtling toward a cliff, and to what extent do people understand the severity of the fiscal situation we’re in. Do people get it?
Romney: They don’t. By and large people don’t get it. People in our party, and part of—it’s our fault because we’ve been talking about deficits and debt for about 25 or 30 years as a party, and so they’ve heard us say it and say it and say it. The fact that Greece is going what it’s going through, and they read about France and Italy and Spain, has finally made this issue topical for the American people. And so when you do polls, and you ask people what is the biggest issue in the 2012 election, No. 1 is the economy and jobs by a wide margin. But No. 2 is the deficit. But debt, that doesn’t calculate for folks, but the deficit does. They recognize you can’t go on forever like this. Although the people who recognize that tend to be Republicans, and the people who don’t recognize that tend to be Democrats. And what we have to get is that 5 or 10 percent in the middle who sometimes vote Republican, sometimes vote Democrat, and have them understand how important this is. It’s a challenge. I did the calculation for folks today, and USA Today publishes this every year. It’s a front-page story: the headline once a year, it somehow escapes people’s attention, and that is, if you take the total national debt and the unfunded liabilities of Medicare, Social Security, and Medicaid, the amount of debt plus unfunded liabilities per household in America is $520,000. Per household.
Audience member: It’s like 12 times their income, right?
Romney: At least. 10, 12 times their income. Even though we’re not going to be writing the check for that amount per household, they’re going to be paying the interest on that. You’ll be paying the interest on that. [Audience laughs.] Because we—my generation will be long gone, and you’ll be paying the interest. And so you’ll be paying taxes, not only for the things you want in your generation, but for all the things we spent money on, which is just—it’s extraordinary to think the tax rates, someone calculated what would happen. If we don’t change Medicare or Social Security, the tax rate—you know what the payroll tax is now, it’s 15.3 percent—if we don’t change those programs, that tax rate will have to ultimately rise to 44 percent. The payroll tax. Then there’s the income tax on top, which the president wants to take to 40 percent. Then there’s state tax in most states. And sales tax. So you end up having to take 100 percent of people’s income. And yet the president, three and a half years in, won’t talk about reforming Social Security or Medicare. And when the Republicans do, it’s “Oh, you’re throwing granny off the cliff.” It’s like you’re killing the kids. The biggest surprise that I have is that young people will vote for Democrats. They look at this and say, “Holy cow! The only guys who are worried about the future of our country and our future are Republicans.” But the Democrats, they talk about social issues, draw in the young people, and they vote on that issue. It’s like, I mean, there won’t be any houses like this if we stay on the road we’re on.
Now that is important stuff. That is what this elections should be about.
Not this other crap that MJ and the left chose to quote out of context. But then, what choice do they have but to resort to that given their candidate of choice’s record.
By the way, there’s now a controversy brewing about the possibility that the secret video might have been edited. Or, perhaps the gap is more like the Nixon tapes. Regardless, charges are flying back and forth. David Corn at MJ says they’re complete. But a bunch aren’t buying that. By the way, MJ blasted James O’Keefe for “edited” ACORN tapes if you’ll remember.
So, it’s politics in the media as usual. Wonderful stuff, no?
Aren’t we being well served?