Questions and Observations

Free Markets, Free People

Some Good News Among All The Bad

It looks like the looming Copenhagen Climate Summit is shaping up to be a bust:

British officials preparing for next month’s UN summit in Copenhagen said the best that could be hoped for was that national leaders would make “political agreements” on emission cuts and payments to help poor countries to adapt to climate change. These agreements would be non-binding, however, and could later be revised or rescinded by national parliaments.

[…]

The admission that no treaty will be signed at Copenhagen marks the failure of the process agreed at a UN meeting in Bali in December 2007, when industrialised countries agreed to deliver a binding climate-change agreement within two years. The delay has angered developing countries, which say they are already suffering from man-made climate change.

No surprise that “developing countries” are angry about this – their opportunity to loot the richer countries has again been delayed. They’re angry because the payday is guaranteed since the “developed” nations have foolishly, in the past, agreed they’re the cause of the problem and should pay the “developing” countries for that.

Artur Runge-Metzger, the European Commission’s negotiator on climate change, said in Barcelona that the absence of commitment from the United States on emission cuts was a key factor contributing to the delay, although other countries were also to blame. He said that without a treaty the EU would agree to cut its 1990 emissions by only 20 per cent by 2020, whereas with a treaty it would agree to a 30 per cent cut.

And they can’t even blame Bush for this one. My question is, if Europe is so hot to trot on this idea, why they don’t take the lead for once and ratchet down their emissions to 30% unilaterally?

I’ll tell you why – because they know what effect it will have on their economy and won’t do anything without being assured everyone is sharing in the suffering.

The one good thing that may come out of this is the economy of Copenhagen may see a nice little economic up-tick as representatives from 190 countries fly in and hit all the posh hotels for a week or so. I wonder what the carbon footprint of that event will be?

~McQ

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Unemployment Hits 10.2% – “Stimulus” Not Stimulating

As President Barack Obama said on Feb. 9 when touting the “stimulus”: “The biggest measure of success is whether we stop contracting and shedding jobs, and we start growing again.”

Well, guess what?  Despite all the happy talk about the end of the recession, unemployment hit 10.2% today.  And, as Dale and others have said constantly, if we were computing it like we did in the ’70s, it would be at 17+%.

So taking the President at his own word, something it seems this administration would prefer everyone not do, it would appears the “stimulus” is still chasing success.

That’s because despite his protestations to the contrary, the the “stimulus” was one, giant earmark.  And it is not having the desired effect despite the bogus “jobs created and saved” numbers.

In fact, the reality of the situation is not at all good as the BLS noted in their press release today:

The number of unemployed persons increased by 558,000 to 15.7 million. The unemployment rate rose by 0.4 percentage point to 10.2 percent, the highest rate since April 1983. Since the start of the recession in December 2007, the number of unemployed persons has risen by 8.2 million, and the unemployment rate has grown by 5.3 percentage points.

And as for those “shovel ready projects” the “stimulus” was supposed to target?

The unemployment rate for the construction field keeps mocking those “shovel-ready” promises: Another 62,000 jobs in construction lost last month, with the average at 67,000 jobs lost per month for the last six months.

The solution? Watch for it – a second “stimulus”, something Paul Krugman has been whining about for months. Any guess what it would look like if it happened? Well the fact that this “stimulus” was used to track radioactive rabbit feces and subsidize golf cart purchases should give you a hint.

By the way, where is “Sheriff Joe” with his policing of the “stimulus” money and calling out those who are wasting it? Overwhelmed by the job, I guess.

Finally there is the economy killing legislation – health care which is front loaded with taxes and cap-and-trade which will raise the cost and price of everything – which the Democrats are determined to pass.  Yup – they’ve got a real handle on this, don’t they?

~McQ

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Top 10 Reasons To Pass Cap-And-Trade

No, I’ve not lost my mind, I just wanted your attention for this great list from the American Energy Alliance:

10) It’ll be the largest tax increase in history and will help pay for the government takeover of health care.

9) America’s unemployment rate is only 10 percent. Higher energy prices and the resulting transfer of American businesses overseas will help us double it.

8 ) The U.S. has been the world’s number one economic superpower for long enough. It’s time to lie down and give someone else a turn.

7) Expensive energy is good. Really expensive energy is even better.

6) By making it more expensive to produce more of the vast amounts of American oil we have right at home and transitioning to affordable, commercial-scale alternatives that don’t exist, we can end our dependence on foreign oil in 10 years!

5) Spending billions of taxpayer dollars to create temporary, government jobs at the expense of long-term, private sector jobs not only makes perfect sense, it’ll be a boon to the nation’s struggling economy. Just look at Spain.

4) Energy is the lifeblood of the American economy – it is, literally, the capacity to do work. Hence, making American energy more expensive and less available will strengthen our economy and enhance our capacity to put Americans to work. Get it?

3) California and Massachusetts have adopted similar policies and they’re now enjoying some of the highest energy prices and unemployment rates in the nation. We need to level the playing field so every state can reap the benefits of expensive energy and abundant joblessness.

2) It will create millions of well-paying green jobs without destroying the jobs of Americans who are currently employed. Who put the green welfare provisions in there, anyway?

1) Reducing economic growth while achieving virtually no environmental benefit is simply a good idea. Don’t ask questions.

Sounds like a heck of a deal, no? ~McQ

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Open Thread – Ft. Hood Tragedy (updated)

It is way to early to come to any conclusions about what happened today at Ft. Hood.  What we do know is that 12 are dead – the shooter (MAJ Malik Nidal Hasan – a psychiatrist with the military there), a civilian policeman and 10 soldiers.  31 were wounded. Hasan was a convert to Islam and worked for 6 years at Walter Reed Hospital.  It is reported that he received a bad Officer Efficiency Report and was transferred to Ft. Hood.  Colleagues say he was a “loner” and against our presence in both Iraq and Afghanistan.  He apparently was against being deployed but was scheduled to deploy at the end of the year.  He was engaged with the chain of command trying to get the deployment canceled. He used two non-military handguns (9 mm) during his shooting spree.

There are reports of two other suspects in custody but what if any role they had is not known.  At this point, they are being said to be held for questioning. (update: AP reports both have now been released, confirmed by Rep. John Carter who represents the district in which Ft. Hood lays.  Rumor has it they had tired to stop the shootings.)

UPDATE: Shooter’s cousin says he has always been a muslim, not a convert. Claims Hasan underwent extreme harassment and wanted to get out of the military. His worst nightmare was being deployed. Says family is in total shock. Thinks impending deployment is what triggered this.

UPDATE II: Sen. Kay Bailey Hutchinson says he was shooting people he knew.

UPDATE III: Rep. John Carter says Ft. Hood authorities have taken a 3rd person into custody.  He also claims reports of automatic weapons fire at the scene of the shootings.

UPDATE IV: A bit of a shocker – Per Commanding General of Ft. Hood, shooter is alive and in custody.

More updates as they become available.

~McQ

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GM Update – It Really Is “Government Motors”

Greg Mankiw reminds us of this bit of fantasy:

What we are not doing — what I have no interest in doing — is running GM. GM will be run by a private board of directors and management team with a track record in American manufacturing that reflects a commitment to innovation and quality. They — and not the government — will call the shots and make the decisions about how to turn this company around. – President Barack Obama

And this bit of reality:

Federal support for companies such as GM, Chrysler Group LLC and Bank of America Corp. has come with baggage: Companies in hock to Washington now have the equivalent of 535 new board members — 100 U.S. senators and 435 House members.

Since the financial crisis broke, Congress has been acting like the board of USA Inc., invoking the infusion of taxpayer money to get banks to modify loans to constituents and to give more help to those in danger of foreclosure. Members have berated CEOs for their business practices and pushed for caps on executive pay. They have also pushed GM and Chrysler to reverse core decisions designed to cut costs, such as closing facilities and shuttering dealerships.

As usual with this bunch, rhetoric and reality are miles apart. Intrusion by members of Congress into the decisions of the company are many, despite the promises of President Obama that “they” will call the shots:

Lawmakers say it’s their obligation to guard the government’s investments, ensure that bailed-out firms are working in the country’s interests and protect their constituents.

Executives say congressional demands gobble up time and make a rocky business environment even more unpredictable.

Or, to put it another way, GM now becomes another “constituent service” problem for members of Congress. And they really don’t care if GM’s business model dictates certain moves to regain profitability – if it hurts a constituent or their district, they just won’t stand for it:

In May, even before the government’s ownership became official, lawmakers erupted when GM disclosed it planned to produce a new subcompact car at its factories in China. Under congressional pressure, GM dropped those plans and promised instead to retool an existing U.S. facility in Michigan, Wisconsin or Tennessee for the new model.

Lawmakers from those states demanded and received high-level meetings in Washington to quiz GM on the criteria for site selection and to tout their states. GM in the end picked a site in Michigan.

The natural reaction to the above is to say “hey, that’s good, we saved or created jobs”? But is it good for the overall profitability of the company which is in hock for over 50+ billion to the taxpayer? Wasn’t the promise to infuse it with cash and allow the company to make the decisions necessary to move it into the black? Instead GM is beaten into line to serve the interests of Congress.

Additionally, closing dealerships has been questioned by any number of Congress members with GM reversing 70 closings. And serving its Democrat special interest groups is also a part of the meddling Congress has engaged in since the takeover:

In addition to the dealership issue, lawmakers have jumped into a union fight that pits GM and Chrysler against two trucking companies that haul new cars around the country. The auto makers want to give some of the work to cheaper nonunion contractors. But that raised the ire of lawmakers who support the International Brotherhood of Teamsters.

Rep. Dale Kildee, a Democrat from Michigan, sent letters on Sept. 30 to the chief executives of both GM and Chrysler, demanding they explain their positions and advising them to stick with their unionized carriers. At least four other lawmakers sent similar letters.

Chrysler defended its plans in an Oct. 2 letter, saying it would save $31 million over three years by shifting some of the work to other carriers. GM, then in the middle of contract talks, replied in its own letter that it had “no plans to phase out unionized hauling companies” but added that it was pursuing new contracts that made the most sense for the company.

So, as it turns out, President Obama’s statement was “just words”. Not only has government intruded, it is engaged in using GM as a tool for self-serving political needs. And that delays the company’s return to profitability and its ability to pay back the money it owes taxpayers. Ford posted a 1 billion quarterly profit recently (certainly driven by “cash for clunkers” but still, a profit). Ford took none of the bailout money. Ford, then, is engaged in running a profitable company which will be competitive in the auto market.

GM and Chrysler – don’t look for any of that to happen for them as long as government and Congress see them as a useful tool to further their own power base and help ensure they remain in office.  And as long as it remains useful for that, don’t expect the relationship to change – and you certainly shouldn’t expect the company to make a profit.  That’s simply not a priority for Congress.

~McQ

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China Buying Oil Leases Off American Shore?

That’s the word from Mark Tapscott at the Washington Examiner:

Gas prices here in the U.S. are creeping back up towards the $3-per-gallon mark even as news breaks today that China’s state-owned energy firm just closed a deal to buy interests in four development leases on the American Outer Continental Shelf (OTS) in the Gulf of Mexico.

The deal, which requires approval of the U.S. government, is between Norway’s Statoil and China National Off-Shore Oil Corporation (CNOOC). This is the same CNOOC that would have bought Unocal four years ago for $18.5 billion but for pressure from Congress, according to The New York Times, quoting an energy industry trade publication.

Because it must be approved by the U.S. government, the Statoil/CNOOC deal puts President Obama and Ken Salazar, his Secretary of the Department of the Interior, which controls OTS leasing, in a difficult position.

Really? Why does it put the government in a “difficult position”? Oh, you mean the apparent willingness to sell these leases to foreign entities vs. opening them up to domestic American exploration?

The deal also focuses renewed attention on Salazar’s slow-walking of a new plan for approving energy exploration and development in the OTS, which includes approximately 1.7 billion acres, and, according to Interior, holds up to 86 billion barrels of recoverable oil and more than 400 trillion cubic feet of natural gas.

The administration is moving much too slowly to open more of the OTS to development for domestic U.S. uses, according to Jack Gerard, president of the American Petroleum Institute …

But it apparently isn’t moving too slowly to open up the OTS to foreign competitors.

In the meantime:

If the administration approves the deal, it will be more vulnerable to charges that the White House is being careless with U.S. national security issues in the energy sector, and that it is putting the interests of a foreign power before those of U.S. energy consumers.

If Obama and Salazar reject the deal, it will likely complicate relations with China, the emerging Asian superpower that defense experts predict will be able at will to challenge U.S. legitimate national security interests around the globe in the near future.

Oil isn’t going away anytime soon and its use is critical during any transition to alternate energy sources (which, for the most part are vaporware). Additionally, the charge that the Obama administration is playing fast and loose with US national security will resonate if the public becomes aware that domestic producers have been barred from OTC production but foreign producers are given access.

So the dilemma facing the administration is one of its own ideological making. Its “slow walking” of the plan for domestic producers to explore the OTC is a decision it made to thwart the desires of a majority of the nation to secure those assets for the US’s use. And now it’s going to hand them over to China?

That will not play well in at all in middle America.

~McQ

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House To Try To Pass Its Version Of Health Care This Week

And it has a number of Democrats more than a little nervous (including 40 Dems who’ve signed a letter stating they won’t sign on as long as the abortion provisions in the bill remain).  Why are they nervous?  Well, 2010 is right around the corner, Republicans has just won some key special elections and Nancy Pelosi has said she’d be ok with losing a few seats if she could get this bill passed.  Here’s a summary:

For starters, the bill is a lot more expensive than advertised. The Congressional Budget Office (CBO) pegs its cost at $1.055 trillion over 10 years, not the $894 billion Mrs. Pelosi claims. Politico reports that “the legislation is projected to create deficits over the second five years” by front-loading revenue and benefit cuts and back-loading costs. The real cost, according to a Republican House Budget Committee report, could be $2.4 trillion for its first decade of operation.

In its first 10 years, the bill calls for $572 billion in new taxes (including a 5.4% income surtax on anyone making more than $500,000 a year), and $426 billion in Medicare and Medicaid cuts, which will hurt seniors and the poor and could lead to rationing of care.

The Congressional Joint Committee on Taxation reported recently that the House’s legislation will whack small businesses because they would pay $153.5 billion of the surtax. Small businesses unable to provide health coverage to their workers would also pay up to 8% in new payroll taxes. This would cost them $135 billion more over the next decade, thereby diminishing their ability to create jobs.

In the House bill there is a $2 billion tax on those who already have health insurance, $20 billion in taxes on medical devices, $8 billion in taxes on anyone who buys over-the-counter drugs with money from their health-savings accounts, and $140 billion in higher taxes on drugs.

Mrs. Pelosi’s bill will drive up premiums. A family of four with an income of $78,000 would pay $13,800 for insurance a year by 2016, according to CBO. Their tab would average $11,000 without the bill.

Every American would be required to buy health insurance or be fined up to 2.5% of their income.

If they vote “yes” this albatross will be hung around the neck of every Democrat in the House – the blue dogs are particularly squeamish about it. Adding those who don’t like the abortion provision (among Democrats) and you have more than enough to defeat it. So why is Pelosi pushing it now? Like Reid, she isn’t the sharpest knife in the drawer when it comes to pure intelligence, but unlike Reid, she knows here domain and how to count votes.

How will she pull this off without some major changes or major concessions? I’m not sure, but right now, experts who are just as adept at counting votes as the whip say there aren’t enough to pass it. Watch and listen carefully as the week finishes with a scheduled vote on Saturday. If she figures out she doesn’t have the votes, we should see a delay. But if she thinks she has them, she’ll be pushing like hell to have the vote this weekend.

~McQ

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Why Would We Want To Make The Same Mistake As Europe?

If you have a friend who is a supporter of the present monstrosity called “health care reform” because they think Europeans are better served by their system than we are by ours and the Democrat’s solution will make us more like them, ask them to watch this 4 1/2 minute video.

By the way, pay particular attention to the rising costs of health care in Europe and, more importantly, the chart which shows costs to include cosmetic surgery, which is the only market based part of health care we have. Amazing how that works, no?

[HT: Maggie’s Farm]

~McQ

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More Violent Protests In Iran

Protests have again flared in Iran on the anniversary of the take over of the US Embassy in the ’70s:

Security forces have used batons and tear gas to disperse opposition supporters in the Iranian capital, Tehran, witnesses and state media say.

Unconfirmed reports said the authorities had also opened fire.

Video posted on a reformist website showed hundreds of opposition supporters marching in central Tehran chanting “death to dictators”.

It came as an officially backed demonstration was held to mark 30 years since the seizure of the US embassy.

Thousands turned out for the anti-American rally, about 1.5km (1 mile) from where opposition supporters gathered in Haft-e Tir square.

Many of the opposition demonstrators wore green scarves or bands, which have been used in repeated protests since Iran’s disputed presidential elections in June.

I’ll remind you that this pattern in Iran – continuing protests across the country at every turn – is exactly the pattern that eventually brought the current regime to power after it overthrew the Shah.

The US’s response – well not much. They’ve been very vocal about Honduras, which is no threat at all to us, while mostly silent about the protests in Iran. And, as we know, Iran is indeed a threat to us and the Middle East. Their Qods forces are active in both Iraq and Afghanistan trying to kill American soldiers and thwart our efforts there.

And what do we do or say? Not much. About the best we get is this:

On Wednesday’s anniversary of the seizure of the US embassy, US President Barack Obama released a statement in which he urged Iran to move beyond the “suspicion, mistrust, and confrontation” that had prevailed between Iran and the US since then.

“Iran must choose,” the statement said. “We have heard for 30 years what the Iranian government is against; the question now is what kind of future it is for.”

My guess is the pro-democracy protesters in Iran would like to hear the same sort of thing from the US.

~McQ

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Say “No” To Secret Treaties – Especially This One (update)

Corey Doctorow at Boing Boing has gotten a leaked copy of what is characterized as a “secret treaty” – secret because of so-called “national security” implications (secrecy, as we were told during the last election, is the first refuge of tyrants). In fact, it is a copyright treaty alleged to be a part of the Anti-Counterfitting Trade Agreement. Doctorow distills the treaty’s salient points as he understands them:

* That ISPs have to proactively police copyright on user-contributed material. This means that it will be impossible to run a service like Flickr or YouTube or Blogger, since hiring enough lawyers to ensure that the mountain of material uploaded every second isn’t infringing will exceed any hope of profitability.

* That ISPs have to cut off the Internet access of accused copyright infringers or face liability. This means that your entire family could be denied to the internet — and hence to civic participation, health information, education, communications, and their means of earning a living — if one member is accused of copyright infringement, without access to a trial or counsel.

* That the whole world must adopt US-style “notice-and-takedown” rules that require ISPs to remove any material that is accused — again, without evidence or trial — of infringing copyright. This has proved a disaster in the US and other countries, where it provides an easy means of censoring material, just by accusing it of infringing copyright.

* Mandatory prohibitions on breaking DRM, even if doing so for a lawful purpose (e.g., to make a work available to disabled people; for archival preservation; because you own the copyrighted work that is locked up with DRM).

I’m assuming “DRM” stands for Digital Rights Management.

Read each of those points carefully. If accurate these measures would effectively shut down much of the internet and certainly, at a minimum, change the way political blogs function. And there is no question, given the onus being put on ISPs by this treaty to police copyright infringement, that they would err on the side of caution.

This is being negotiated right now in Seoul, Korea by the administration (and, as this Canadian blogger points out, these provisions are being pushed by the US) which so derisively trashed the “Patriot Act” during the presidential campaign. As Doctorow points out, it’s draconian provisions leave ISPs with little choice but to take down anything about which there is even a hint of doubt.  “Chilling effect” doesn’t even begin to describe the effect of such a treaty on free speech.

As for the transparency promised by this administration, this, among a mountain of things since it has taken office, apparently doesn’t fit that category.  Being negotiated away in secret is  your ability to access the internet and speak out if there’s even a hint (proof is not necessary) that copyrighted material is included in your piece.

Sound reasonable?  Or are you still a bit of a traditionalist and want to see legal due process and the presumption of innocence remain as the first line defense of your rights? If you enjoy the ‘net as it stands now, you need to speak out against this obvious attempt to control speech.  Treaties, even secret ones, still have to be ratified by the Senate.  The way to stop this one is to make it not so secret and demand that the Senate vote it down.

UPDATE: Reason’s Jesse Walker:

As the Anti-Counterfeiting Trade Agreement enters its sixth round of secret negotiations, rumors are emerging about the provisions under discussion. The Electronic Frontier Foundation has posted the reports it has heard here; if the leaks are true, the treaty will be filled with measures that, in EFF’s words, “have nothing to do with addressing counterfeit products, but are all about imposing a set of copyright industry demands on the global Internet.”

See Michael’s discussion about “corporatism”.  It’s like slipping an amendment to build a museum to Ted Kennedy into a defense appropriations bill – hide the desired but unpopular special interest legislation in a more popular and necessary bill.

~McQ

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