The prototypical characterization of a Liberal is usually someone who is more altruistic and cares more about people than a Republican. But is that really true or are Liberals actually far more selfish than Republicans?
Completely contrary to "conventional wisdom", I would argue that those who favor wealth transfers via entitlement programs paid for by increased taxes on only a small percentage of the population and by government borrowings (with a future repayment date) are the truly selfish ones. I say small percentage as the top 20% to 30% of income-earners pay 70% to 80% of the taxes or more while at the same time the bottom 50% of earners pay virtually no income taxes.
With that as backdrop, is it really fair or equitable for the government to fund programs that will only benefit the current generation when subsequent generations will actually have to pay for the cost through higher taxes and repayment of the mounting debt used to fund perennial budget shortfalls? I think the answer is obvious to any fair-minded person. Because such a person would necessarily believe that is would not be fair to use his money to pay for someone's else lifestyle or profligate ways. If this is true with respect to a personal budget, how can it not also be true for the federal government's budget as well?
Take the grandaddies of all entitlement programs: Social Security and Medicare. While those programs work quite well for the current recipients, it is undeniable that the present systems is unsustainable. FICA or other taxes will have to be increased as will age limits for eligibility. Services will likely decline as well. But where is the sacrifice of the current beneficiaries, especially those who can afford to pay a higher share of the burden? Nowhere, as no contribution or sacrifice is expected of them, even those of them that can afford to pay part of the cost.
While most beneficiaries will argue that since they paid what was required of them at the time into the system that they should not be required to withstand a cut in benefits, this argument fails to take into account the extended projected life spans and sheer number of prospective workers available to fund the entitlement benefits to current recipients as opposed to what was originally contemplated.
It is not new information to point out that at the time of Social Security's creation, there were approximately sixteen workers paying FICA taxes for each recipient and the projected life span and overall benefits to a retiree were substantially lower. (In other words, it was expected that most people would die before even collecting any benefits.) But this implicit, if not explicit assumptions, upon which Social Security was enacted has never been seriously readjusted even though such assumptions are constantly reexamined for a private pension fund.
And the ever-increasing cost of Medicare is actually being paid by current workers not current recipients. As Medicare costs have risen so has the portion of ordinary income taxed to fund those benefits. It is likely that Medicare funding will continue to rise via the amount and percentage of compensation taxed. That had already become that pattern with Social Security and Medicare within the last decade or so; Indeed, Medicare no longer has any limit on the amount of personal service income taxable to sustain its funding.
There are numerous other examples of government largess being expended today that will effectively have to be paid for in the future. Why does this happen? Principally because the recipients of those programs aren't paying for them out of their pocket but they are stalwart supporters of and voters for politicians who keep handing out the benefits. So, the issue of generational fairness is often trumped by the political expediency of reelection concerns.
For this country to return to a sound economic footing, we must stop incurring debts beyond our ability to pay for them currently. It is an outrage that today's politicians focus solely or almost exclusively on the non-contributing beneficiaries as their constituency as opposed to the people who are paying the bill.
While the needs of a society will always seem to trump its ability to pay for them. The tide has swung so disproportionately in the other direction as to engender alienation and cynicism of the political process to those who resources are forever being drained to fund programs that will either not exist in the future or, if they do, in a much more limited form. And for those politicians, for the most Liberals or Progressives, that wittingly, self-righteously and methodically promote this sort of government sponsorship as being in the "common good", they can only be viewed as selfish to those who will bear the burden of their irresponsible actions of today.
Monday, March 8, 2010
Sunday, March 7, 2010
Liberals and the "It's About Time" Attitude
Something occurred to me tonight as I watched the end of the Academy Awards broadcast. Barbra Streisand while announcing the "Best Director" award to a woman said: "It's about time!" I thought: It's about time that a woman won the award for Best Director because she was a woman? My question was only prompted by her need to qualify the woman's achievement or to frame it in a sexist construct. Otherwise, I frankly wouldn't have thought about it.
This "It's about time" mentality is the same mentality that was frequently cited by Liberals when Barack Obama was running for President for his election -- It's about time that an African-American was elected President of the United States -- as if that were a reason or argument. It's the same mentality that has been used by Liberals in politics and in the workforce and in education for a long time to justify an action that, perhaps, on its own merits may not stand up to scrutiny.
I am not suggesting that the selection of a woman as Best Director or that Barack Obama's election as President was based on their diversity rather than her or his qualifications. Quite to the contrary. Rather, I think it is sort of an insult to preface someone's achievements with the qualifier "It's about time" if it is said as "code" for "entitlement", rather than an acknowledgment of something that strictly from a historical perspective took a long time to happen. Sadly, the former is often how it is used principally.
While that phraseology may have been more appropriate when there was blatant racism or sexism in corporate America or education institutions or where there were prohibitions, carved into the law and custom, against the hiring or acceptance of blacks, women, Jews, Catholics, etc. because of that very status, it is quite another thing to continually lament even after the election of the first black to the presidency and the vast numbers of women and blacks and Asians, for example, in senior positions in corporations and in a wide array of industries, and as doctors and lawyers and other professions, that "It's about time."
"It's about time" signifies just the opposite of when someone, anyone, regardless of race, creed or religion, is qualified or has earned a distinction separate and apart for one's diversity identifier. It lessens the achievements of those whose identifier is completely irrelevant to their success, baggage which suggests that "but for that identifier" the person wouldn't be where he is today.
It is not surprising that Streisand would make such a comment. She is a classic limousine liberal who almost expects the audience to cheer when she ignorantly uses the expression "It's about time" almost as a compliment. It is no such thing. It is, in fact, the perpetuation of a stereotype that over the years has continually abated, in law and costom and general human interaction, and will continue to abate. It is a non-issue for the majority of Americans lest 53% of them would not have voted for Barack Obama.
There is also a danger of making any argument when one's perspective is in a significant way guided by the "It's about time" mentality. Such an individual is looking to use diversity as a qualifying characteristic.
Should a woman or a black or a black women or a Muslim or whomever (who is not a while male) get a job, award or special consideration because of that fact alone? In the world of Liberal politics and policies the answer still appears to be "yes" for the Steisands of the world. These types of people are truly dangerous once "merit" becomes less important or no more important than all other color-blind characteristics of a person.
This "It's about time" mentality is the same mentality that was frequently cited by Liberals when Barack Obama was running for President for his election -- It's about time that an African-American was elected President of the United States -- as if that were a reason or argument. It's the same mentality that has been used by Liberals in politics and in the workforce and in education for a long time to justify an action that, perhaps, on its own merits may not stand up to scrutiny.
I am not suggesting that the selection of a woman as Best Director or that Barack Obama's election as President was based on their diversity rather than her or his qualifications. Quite to the contrary. Rather, I think it is sort of an insult to preface someone's achievements with the qualifier "It's about time" if it is said as "code" for "entitlement", rather than an acknowledgment of something that strictly from a historical perspective took a long time to happen. Sadly, the former is often how it is used principally.
While that phraseology may have been more appropriate when there was blatant racism or sexism in corporate America or education institutions or where there were prohibitions, carved into the law and custom, against the hiring or acceptance of blacks, women, Jews, Catholics, etc. because of that very status, it is quite another thing to continually lament even after the election of the first black to the presidency and the vast numbers of women and blacks and Asians, for example, in senior positions in corporations and in a wide array of industries, and as doctors and lawyers and other professions, that "It's about time."
"It's about time" signifies just the opposite of when someone, anyone, regardless of race, creed or religion, is qualified or has earned a distinction separate and apart for one's diversity identifier. It lessens the achievements of those whose identifier is completely irrelevant to their success, baggage which suggests that "but for that identifier" the person wouldn't be where he is today.
It is not surprising that Streisand would make such a comment. She is a classic limousine liberal who almost expects the audience to cheer when she ignorantly uses the expression "It's about time" almost as a compliment. It is no such thing. It is, in fact, the perpetuation of a stereotype that over the years has continually abated, in law and costom and general human interaction, and will continue to abate. It is a non-issue for the majority of Americans lest 53% of them would not have voted for Barack Obama.
There is also a danger of making any argument when one's perspective is in a significant way guided by the "It's about time" mentality. Such an individual is looking to use diversity as a qualifying characteristic.
Should a woman or a black or a black women or a Muslim or whomever (who is not a while male) get a job, award or special consideration because of that fact alone? In the world of Liberal politics and policies the answer still appears to be "yes" for the Steisands of the world. These types of people are truly dangerous once "merit" becomes less important or no more important than all other color-blind characteristics of a person.
Thursday, March 4, 2010
The Real Cost of Progressivism
Students -- Wake up! You are not immune from the travails of the U.S. economy or the policies of the government. If you're angry about budget cuts to public education, wait until you see what happens with Medicare and Social Security. By the time you are eligible for these programs, they will either be bankrupt or a shadow of their current selves.
There are consequences to the progressive agenda. And it's about time you started learning about them. Progressivism is just a euphemism for "creeping socialism", for greater government involvement in the economic affairs of this country as well as many of its social benefits such as education, healthcare, social security, unemployment compensation, welfare and food stamps. All of these "entitlements" cost money. They have to be paid for either from tax receipts or borrowings.
Taxes should be designed to pay the current costs of operating the government. Borrowings should only be used to fund long-term benefits lasting beyond one tax year. In that way, the cost of the benefit will be spread over its useful life and the taxpayers of today and in the future will all contribute because all of them benefit.
What is going on in the current economic crisis is that costs continue to be incurred that can't be paid from current income (i.e., tax receipts). So, instead of deferring or cutting non-essential expenses, the government continues to borrow more money from foreign sources knowing full well that the current generation is not going to have to repay the bill and associated interest. That cost will be borne by future generations who received no benefit from such cost and will ultimately bankrupt this country once the interest on the national debt makes it impossible to continue borrowing or fund current governmental expenses.
So, dear students, remember that if you are inclined to fight against cuts to education which directly affect you now, you should be equally inclined to do so against those programs and expenditures that you will be forced to pay for in the future without any benefit to you. That is the consequence of progressivism in a nutshell.
There are consequences to the progressive agenda. And it's about time you started learning about them. Progressivism is just a euphemism for "creeping socialism", for greater government involvement in the economic affairs of this country as well as many of its social benefits such as education, healthcare, social security, unemployment compensation, welfare and food stamps. All of these "entitlements" cost money. They have to be paid for either from tax receipts or borrowings.
Taxes should be designed to pay the current costs of operating the government. Borrowings should only be used to fund long-term benefits lasting beyond one tax year. In that way, the cost of the benefit will be spread over its useful life and the taxpayers of today and in the future will all contribute because all of them benefit.
What is going on in the current economic crisis is that costs continue to be incurred that can't be paid from current income (i.e., tax receipts). So, instead of deferring or cutting non-essential expenses, the government continues to borrow more money from foreign sources knowing full well that the current generation is not going to have to repay the bill and associated interest. That cost will be borne by future generations who received no benefit from such cost and will ultimately bankrupt this country once the interest on the national debt makes it impossible to continue borrowing or fund current governmental expenses.
So, dear students, remember that if you are inclined to fight against cuts to education which directly affect you now, you should be equally inclined to do so against those programs and expenditures that you will be forced to pay for in the future without any benefit to you. That is the consequence of progressivism in a nutshell.
Wednesday, March 3, 2010
Another Reason Our Allies Must Accept More Military Responsibility
When one doesn't have to pay the bill, it is easy to be oblivious to the cost and sacrifices of others. This has been a burgeoning problem with respect to the monetary and human costs of the United States for being largely responsible for providing for the defense of our allies since World War II.
Initially, this was an appropriate role for the U.S. to play. Europe and Japan were physically devastated after the War and necessarily their focus was on rebuilding their countries with U.S. assistance. The U.S. was also concerned about the re-arming of our former enemies, Japan and West Germany. The U.S.S.R. was a threat that only the U.S. could thwart in the aftermath of the War.
But much has happened in the 65 years since then. Japan now has the world's second largest economy and Germany ranks third. Europe has restored itself and largely prospered and flourished while the Soviet Union crumbled. None of this would have been possible without the strong and reliable support of the U.S. But, although time has marched on, Europe has still now assume its fair share for the defense of themselves and the West, nor have they shouldered the cost of the U.S. defense presence on their soil. Whereas this once made sense, it no longer does anymore.
Additionally, the lack of Japan and European contributions to their own defense has been largely taken for granted because the U.S. was primarily footing the bill. And therein lies the rub. Our allies have continued to benefit from the U.S. expenditures on defense so as to be immunized from the true cost of their own freedom and liberty. Perhaps if our allies bore their share of the defense burden, they would have to make tough choices about their own priorities, which for too long they have shunted away.
Initially, this was an appropriate role for the U.S. to play. Europe and Japan were physically devastated after the War and necessarily their focus was on rebuilding their countries with U.S. assistance. The U.S. was also concerned about the re-arming of our former enemies, Japan and West Germany. The U.S.S.R. was a threat that only the U.S. could thwart in the aftermath of the War.
But much has happened in the 65 years since then. Japan now has the world's second largest economy and Germany ranks third. Europe has restored itself and largely prospered and flourished while the Soviet Union crumbled. None of this would have been possible without the strong and reliable support of the U.S. But, although time has marched on, Europe has still now assume its fair share for the defense of themselves and the West, nor have they shouldered the cost of the U.S. defense presence on their soil. Whereas this once made sense, it no longer does anymore.
Additionally, the lack of Japan and European contributions to their own defense has been largely taken for granted because the U.S. was primarily footing the bill. And therein lies the rub. Our allies have continued to benefit from the U.S. expenditures on defense so as to be immunized from the true cost of their own freedom and liberty. Perhaps if our allies bore their share of the defense burden, they would have to make tough choices about their own priorities, which for too long they have shunted away.
Leave Japan to Its Own Defenses
Why does the U.S. still have 50,000 troops in Japan more than almost 65 years after the end of World War II? And what are they doing there when the Japanese public in Okinawa doesn't even want them there?
The U.S. has a deeply-rooted superiority complex or, dare I say, an imperialist complex that no longer makes sense at this time in history. It was logical after WWII that the U.S. would maintain a presence in Japan to ensure that our former enemy did not re-arm itself and as a buffer to the Soviet Union. But that time has past. Japan is a steadfast ally of the U.S., it has the world's second largest economy and the U.S.S.R is a relic of its former self. Yet, the U.S. persists in the notion that we are the policemen of the world. We can no longer afford this indulgence
If Japan is able to provide for its own defense, then it should do so. If not, it should bear all of the costs of the U.S. presence there if it wants us to remain. The U.S. has borne the brunt of the defense costs of the Westernized world since the Great War. We have spent trillions more in gross dollars and also as a percentage of our GDP than any of our Western allies. This kind of thinking and pattern of behavior must stop if for no other reason than we cannot afford it when our allies are not even paying anywhere near their fair share.
Europe, consistent with all of its socialist tendencies, has become too dependent on the U.S. to act as its de facto "war" army and has not shouldered, economically or in manpower or other resources, its burden of the responsibility for its own defense. We must reverse this course not only for our own legitimate fiscal and political reasons but also to encourage our European and Asian allies to start standing on their own feet to a much greater extent militarily.
The U.S. has a deeply-rooted superiority complex or, dare I say, an imperialist complex that no longer makes sense at this time in history. It was logical after WWII that the U.S. would maintain a presence in Japan to ensure that our former enemy did not re-arm itself and as a buffer to the Soviet Union. But that time has past. Japan is a steadfast ally of the U.S., it has the world's second largest economy and the U.S.S.R is a relic of its former self. Yet, the U.S. persists in the notion that we are the policemen of the world. We can no longer afford this indulgence
If Japan is able to provide for its own defense, then it should do so. If not, it should bear all of the costs of the U.S. presence there if it wants us to remain. The U.S. has borne the brunt of the defense costs of the Westernized world since the Great War. We have spent trillions more in gross dollars and also as a percentage of our GDP than any of our Western allies. This kind of thinking and pattern of behavior must stop if for no other reason than we cannot afford it when our allies are not even paying anywhere near their fair share.
Europe, consistent with all of its socialist tendencies, has become too dependent on the U.S. to act as its de facto "war" army and has not shouldered, economically or in manpower or other resources, its burden of the responsibility for its own defense. We must reverse this course not only for our own legitimate fiscal and political reasons but also to encourage our European and Asian allies to start standing on their own feet to a much greater extent militarily.
Tuesday, March 2, 2010
Healthcare Debate Should Be Informed By Postal Service Model
In the zeal to pass so-called healthcare reform, the Democrats initially tried to ramrod through Congress a "public option", whereby the government would manage a single payer system or the government would regulate most aspects of healthcare service delivery and insurance. This "land-grab" was modified by the Senate and over time rejected by the American public. Cynically and brooking no opposition, the Democrats wanted to act as quickly as possible to transform one-sixth of the American economy before anyone really had a chance to understand its details.
But the passage of time allows the dust to settle and sunshine to act as a "disinfectant", according to Justice Brandeis. So, as the process slowed a bit, more and more faults of the healthcare plan came to light and it wasn't pretty, particularly since it did virtually nothing to control costs except to mandate reductions of government-sponsored medical reimbursement rates. Of course, this brilliant idea didn't take into account that doctors and other medical professionals are free actors and might not take too kindly to reduced pay as the supposed panacea to increase the number of people covered by health insurance.
In many respects, the U.S. Postal Service suffers from the same "public option" maladies as these proposed healthcare schemes. For most of its history, it had a complete monopoly on the delivery of mail throughout the United States. But whenever competing alternatives have arisen by virtue of sheer entrepreneurship, circumstance or technology, the result has always been the same -- the Postal Service could not and would not reform itself to compete despite the many competitive advantages in its favor.
For example, UPS started as a messenger company in 1907, an alternative to use of the Postal Service. Over time, more and more people and business began to rely on UPS for delivery of all many of parcels and goods because it was efficient and reliable even if it cost more than a comparable service available by the Postal Service. Now, UPS and Federal Express and many other companies compete for the delivery of packages and overnight courier mail despite the availability of special delivery.
This has occurred inexorably because the Postal Service never responded to the challenges of the free market and simply assumed that it would either get its fair share of business to be self-sustaining without providing a comparable level of service in the areas in which it was required to compete.
Its last bastion of dominance is regular mail or direct mail advertisements. But with the advent of the fax machine and e-mail, demand for the former has waned with each passing year and with respect to the latter, the costs have become prohibitive to justify the quantities previously enjoyed.
But what has been the government's response? Higher labor costs and faltering services as the workforce has fallen. Instead of demanding and requiring more from its workers and the entire postal service bureaucracy, the federal government has continued to bail out this wasting asset. In private industry, if a business can't at least break-even, it eventually fails. The Postal Services has too long relied on increased postal rates when the cost bears no relationship to the quality of the service provided. The same scenario is equally applicable to public transportation in major cities where service continues to be limited and declining while fares increase even as the price of gasoline has consistently risen over the years.
The question then becomes if the government cannot even manage the Postal Service or public transportation, how is it supposed to oversee the healthcare system in the country which is infinitely more complex and expensive and, again, represents one-sixth of the American economy. In short, it is foolhardy to assume it can do so better than private enterprise incentivized properly and regulated in such a manner to enable healthcare services to be allocated without needless bureaucratic intrusion. The answer is not more government involvement but less: fewer mandates, allow insurance companies, medical professionals and institutions and states to compete to find workable solutions that can be applied nationwide after the best ideas and practices emerge.
But the passage of time allows the dust to settle and sunshine to act as a "disinfectant", according to Justice Brandeis. So, as the process slowed a bit, more and more faults of the healthcare plan came to light and it wasn't pretty, particularly since it did virtually nothing to control costs except to mandate reductions of government-sponsored medical reimbursement rates. Of course, this brilliant idea didn't take into account that doctors and other medical professionals are free actors and might not take too kindly to reduced pay as the supposed panacea to increase the number of people covered by health insurance.
In many respects, the U.S. Postal Service suffers from the same "public option" maladies as these proposed healthcare schemes. For most of its history, it had a complete monopoly on the delivery of mail throughout the United States. But whenever competing alternatives have arisen by virtue of sheer entrepreneurship, circumstance or technology, the result has always been the same -- the Postal Service could not and would not reform itself to compete despite the many competitive advantages in its favor.
For example, UPS started as a messenger company in 1907, an alternative to use of the Postal Service. Over time, more and more people and business began to rely on UPS for delivery of all many of parcels and goods because it was efficient and reliable even if it cost more than a comparable service available by the Postal Service. Now, UPS and Federal Express and many other companies compete for the delivery of packages and overnight courier mail despite the availability of special delivery.
This has occurred inexorably because the Postal Service never responded to the challenges of the free market and simply assumed that it would either get its fair share of business to be self-sustaining without providing a comparable level of service in the areas in which it was required to compete.
Its last bastion of dominance is regular mail or direct mail advertisements. But with the advent of the fax machine and e-mail, demand for the former has waned with each passing year and with respect to the latter, the costs have become prohibitive to justify the quantities previously enjoyed.
But what has been the government's response? Higher labor costs and faltering services as the workforce has fallen. Instead of demanding and requiring more from its workers and the entire postal service bureaucracy, the federal government has continued to bail out this wasting asset. In private industry, if a business can't at least break-even, it eventually fails. The Postal Services has too long relied on increased postal rates when the cost bears no relationship to the quality of the service provided. The same scenario is equally applicable to public transportation in major cities where service continues to be limited and declining while fares increase even as the price of gasoline has consistently risen over the years.
The question then becomes if the government cannot even manage the Postal Service or public transportation, how is it supposed to oversee the healthcare system in the country which is infinitely more complex and expensive and, again, represents one-sixth of the American economy. In short, it is foolhardy to assume it can do so better than private enterprise incentivized properly and regulated in such a manner to enable healthcare services to be allocated without needless bureaucratic intrusion. The answer is not more government involvement but less: fewer mandates, allow insurance companies, medical professionals and institutions and states to compete to find workable solutions that can be applied nationwide after the best ideas and practices emerge.
U.S. Postal Service Is Government Bureaucracy Run Amok
The U.S. Postal Service is the quintessential government bureaucracy that is incapable of meaningful reform or improvement. Even though the volume of mail is declining at an astounding rate due to the internet as well as high costs of postage, the American public is supposed to tolerate substandard service as if it is simply understood and accepted as a fact of life.
The Postal Service has been pricing itself out of the market for years. Given a choice, I suspect most people would gladly select an alternative if one was available for ordinary mail. When such an option presented itself for expedited delivery via Federal Express and its cohorts, the public and the business community bolted, preferring service and accountability to the government-subsidized "public option." Sound eerily familiar?
While the private sector has been forced to keep costs under control to remain competitive, the compensation and benefits awarded to postal workers and other federal employees are out of whack. Instead of previously being a lesser-paid alternative to the private sector with job security, its pay structure now vastly exceeds equivalent job opportunities in the "real" world.
This attitude of government-tenure jobs with never-ending cost increases is leading not only the postal service but our entire government apparatus to the brink of bankruptcy. It's about time government workers were held to the same standards, compensation and benefits as everyone else. Just think of what that would do to the budget deficit.
The Postal Service has been pricing itself out of the market for years. Given a choice, I suspect most people would gladly select an alternative if one was available for ordinary mail. When such an option presented itself for expedited delivery via Federal Express and its cohorts, the public and the business community bolted, preferring service and accountability to the government-subsidized "public option." Sound eerily familiar?
While the private sector has been forced to keep costs under control to remain competitive, the compensation and benefits awarded to postal workers and other federal employees are out of whack. Instead of previously being a lesser-paid alternative to the private sector with job security, its pay structure now vastly exceeds equivalent job opportunities in the "real" world.
This attitude of government-tenure jobs with never-ending cost increases is leading not only the postal service but our entire government apparatus to the brink of bankruptcy. It's about time government workers were held to the same standards, compensation and benefits as everyone else. Just think of what that would do to the budget deficit.
Tuesday, February 23, 2010
Nancy Pelosi's Abuses of Power Hurts Obama's Efforts for Bipartisanship
We've all heard the aphorism: "Power corrupts and absolute power corrupts absolutely". No one currently exemplifies this time-tested truth more than Nancy Pelosi. Although Barack Obama is our President, Speaker Pelosi has exhibited a callous disregard for her opponents whether Republicans or members of her own party. She takes counsel from no one and scoffs with all those who disagree with her even the American public
Recently, Scott Brown won the late Senator Kennedy's senate seat (or, rather, "the people's seat") in Massachusetts. Brown campaigned against the current Democratic version of healthcare "reform", among other things. He referred to himself quite conspicuously as the "41st vote" against adoption of such legislation. He expressed his desire to work with Democrats to craft a new bipartisan approach to healthcare that focused on prohibiting insurance companies from denying coverage based on pre-existing conditions, permitting competition between insurance companies across state lines and enacting tort reform to reduce the cost of unnecessary medical procedures that are often undertaken simply for fear of litigation. He also campaigned against the special interest giveaways that had undermined the integrity of the extant healthcare legislation.
Apparently, Pelosi didn't get the memo after Brown's shocking upset victory in Massachusetts, the bluest of blue states that other Democrats surely received as demonstrated by their actions since then. While the majority of Democrats in the Senate realize that The People had spoken and that a reset and a more bipartisan effort was needed to achieve public support for healthcare reform, Pelosi has continued to pursue a rejected approach that is opposed by a substantial majority of the U.S. electorate unabated.
Is this what Pelosi calls leadership? If so, she is more tone deaf that even her worst critic could have imagined. She is now attempting to circumvent the public will by a bald parliamentary maneuver that would attempt to pass the Senate version of healthcare legislation solely for the purpose of then modifying it through a process called "reconciliation" that does not require a cloture vote of 60 senators.
If Pelosi is allowed to proceed with such a cynical power play with the support of congressional Democrats, it will likely backfire in their faces come November. Even President Obama has expressed a more conciliatory tone (at least publicly) concerning healthcare reform, including suggesting that he is open to any good ideas from whatever source. So, in that respect, Obama is a rightfully and responsibly a bit chastened by the new paradigm since Brown's election and not outwardly displaying the megalomaniacal tendencies of the Speaker.
Based on Pelosi's actions, it is fairly evident that her quench for power is corrupting the process to such an extent that not even Obama has publicly supported her latest machinations. Even he realizes that too close an association with Pelosi is not good for him politically or for Democrats generally.
So whatever benefits that Obama may have realized as a result of his State of the Union address (which I will separately argue are very few), Pelosi seems intent on not being a team player and intent on upsetting the applecart of bipartisanship before it has even had a chance to germinate or potentially fail on its own.
Recently, Scott Brown won the late Senator Kennedy's senate seat (or, rather, "the people's seat") in Massachusetts. Brown campaigned against the current Democratic version of healthcare "reform", among other things. He referred to himself quite conspicuously as the "41st vote" against adoption of such legislation. He expressed his desire to work with Democrats to craft a new bipartisan approach to healthcare that focused on prohibiting insurance companies from denying coverage based on pre-existing conditions, permitting competition between insurance companies across state lines and enacting tort reform to reduce the cost of unnecessary medical procedures that are often undertaken simply for fear of litigation. He also campaigned against the special interest giveaways that had undermined the integrity of the extant healthcare legislation.
Apparently, Pelosi didn't get the memo after Brown's shocking upset victory in Massachusetts, the bluest of blue states that other Democrats surely received as demonstrated by their actions since then. While the majority of Democrats in the Senate realize that The People had spoken and that a reset and a more bipartisan effort was needed to achieve public support for healthcare reform, Pelosi has continued to pursue a rejected approach that is opposed by a substantial majority of the U.S. electorate unabated.
Is this what Pelosi calls leadership? If so, she is more tone deaf that even her worst critic could have imagined. She is now attempting to circumvent the public will by a bald parliamentary maneuver that would attempt to pass the Senate version of healthcare legislation solely for the purpose of then modifying it through a process called "reconciliation" that does not require a cloture vote of 60 senators.
If Pelosi is allowed to proceed with such a cynical power play with the support of congressional Democrats, it will likely backfire in their faces come November. Even President Obama has expressed a more conciliatory tone (at least publicly) concerning healthcare reform, including suggesting that he is open to any good ideas from whatever source. So, in that respect, Obama is a rightfully and responsibly a bit chastened by the new paradigm since Brown's election and not outwardly displaying the megalomaniacal tendencies of the Speaker.
Based on Pelosi's actions, it is fairly evident that her quench for power is corrupting the process to such an extent that not even Obama has publicly supported her latest machinations. Even he realizes that too close an association with Pelosi is not good for him politically or for Democrats generally.
So whatever benefits that Obama may have realized as a result of his State of the Union address (which I will separately argue are very few), Pelosi seems intent on not being a team player and intent on upsetting the applecart of bipartisanship before it has even had a chance to germinate or potentially fail on its own.
Monday, February 22, 2010
Jobs Bill is Populist Gimmickry, Not Sound Economic Policy
This post is in response to the CNN article of February 22, 2010 entitled: Senate Takes up Jobs Bill.
Based on the Sentate vote today, it seems virtually certain that the so-called "Jobs Stimulus" bill will shortly be on President Obama's desk. This is a classic example of seemingly well-intentioned legislation that, in reality, won't achieve its intended purpose and is fraught with opportunities for fraud and outright gamesmanship.
The purpose of the tax credits is to create incremental "new" jobs, not to reward employers for creating jobs that they would have created without the credits otherwise the legislation serves no purpose. And therein lies the problem. The tax incentive is not really sufficient enough to cause a rash of hiring amongst employers given the uncertainty of health care reform, cap and trade and other taxes. Consequently, an employer is only going to hire a new employee who is truly needed based on the demands of the relevant business and not to take advantage of a tax break. The jobs that will be "created" will likely be those that would have been created without any incentive and in the process the taxpayers are going to fund this "job creation" scheme which will result merely in found money to employers because the employers actions will not be driven by or changed due to the tax benefit. This type of "benefit" leads to gamesmanship because no one can say with absolute certitude whether a job would have been created but for the credit. This squishy reasoning behind this latest government giveaway permeates all government-sponsored attempts to reinvigorate the economy artificially.
Presumably, the Obama Administration will later argue that all or substantially all the new jobs created after the tax credits become law were a direct result of the credits. That is unknowable and unprovable and, for the reasons stated above, will likely not be true.
I can't blame any employer for taking advantage of a credit for a new job, whether or not the job would have been created anyway. There is absolutely no way to reasonably police the system and, again, politicians will claim credit for stirring economic growth while the private sector pockets the free cash via tax credits. This lack of causal connection, of course, will be cheered and occur with the full blessing of populist politicians who care more about public perceptions rather than sound economic policy.
Has this administration not learned that gimmickry is simply that? That it has no long-lasting effects and may actually create mini-bubbles (e.g., Cash for Clunkers). It only changes behavior on a short-term basis lest the unemployment rate -- the real one including discouraged workers -- wouldn't be hovering around 17% or more. But reality and politics are often disengaged from one another as evidenced by surreal deficits that continue to grow unabated.
Based on the Sentate vote today, it seems virtually certain that the so-called "Jobs Stimulus" bill will shortly be on President Obama's desk. This is a classic example of seemingly well-intentioned legislation that, in reality, won't achieve its intended purpose and is fraught with opportunities for fraud and outright gamesmanship.
The purpose of the tax credits is to create incremental "new" jobs, not to reward employers for creating jobs that they would have created without the credits otherwise the legislation serves no purpose. And therein lies the problem. The tax incentive is not really sufficient enough to cause a rash of hiring amongst employers given the uncertainty of health care reform, cap and trade and other taxes. Consequently, an employer is only going to hire a new employee who is truly needed based on the demands of the relevant business and not to take advantage of a tax break. The jobs that will be "created" will likely be those that would have been created without any incentive and in the process the taxpayers are going to fund this "job creation" scheme which will result merely in found money to employers because the employers actions will not be driven by or changed due to the tax benefit. This type of "benefit" leads to gamesmanship because no one can say with absolute certitude whether a job would have been created but for the credit. This squishy reasoning behind this latest government giveaway permeates all government-sponsored attempts to reinvigorate the economy artificially.
Presumably, the Obama Administration will later argue that all or substantially all the new jobs created after the tax credits become law were a direct result of the credits. That is unknowable and unprovable and, for the reasons stated above, will likely not be true.
I can't blame any employer for taking advantage of a credit for a new job, whether or not the job would have been created anyway. There is absolutely no way to reasonably police the system and, again, politicians will claim credit for stirring economic growth while the private sector pockets the free cash via tax credits. This lack of causal connection, of course, will be cheered and occur with the full blessing of populist politicians who care more about public perceptions rather than sound economic policy.
Has this administration not learned that gimmickry is simply that? That it has no long-lasting effects and may actually create mini-bubbles (e.g., Cash for Clunkers). It only changes behavior on a short-term basis lest the unemployment rate -- the real one including discouraged workers -- wouldn't be hovering around 17% or more. But reality and politics are often disengaged from one another as evidenced by surreal deficits that continue to grow unabated.
Friday, February 5, 2010
Obama Tanks Stock Market Again on SBA Plan
Someone in the White House should tell President Obama that every time he speaks on television about the economy or some new government program to artificially prop it up, the stock market tanks. Today he did it again.
Obama has determined that the government via the Small Business Administration (SBA) is now going to guarantee small business loans up to $5 million. Those loans can be used not only to purchase inventory and equipment, as was the typical limitation in the past, but also now to finance real estate.
So, now the government can stick its fingers into another potential real estate rathole which hasn't worked in the past. Obama again has the uncanny knack of devising "solutions" that will end up socializing loan losses and privatizing business profits.
How is the government going to determine who qualifies for new SBA loans when banks are unwilling to lend to small businesses themselves? Perhaps the banks have good reason not to lend given the current uncertainties in the economy. Perhaps banks have learned their lesson that lending to questionably capitalized and non-creditworthy borrowers carries consequences.
Regardless of the lessons to be learned from the financial crisis, Obama is either oblivious to them or simply ignoring them for political expediency. His rationale for doing so is that since the banks won't loan to small businesses the government must do so instead. Is that a new form of underwriting standard: banks won't lend to prospective borrowers so the government should or must lend. Seems unwise and fraught with risk.
As a consequence, Obama is not allowing the free market system to function. In difficult economic times, unfortunately, lenders are forced to tighten lending standards and many businesses cannot obtain funding. But to put taxpayer money at risk when private lenders are unwilling to underwrite the same risks that the SBA will surely undertake sounds like a repeat of the Fannnie Mae/Freddie Mac debacle admittedly on a smaller scale.
While small business is usually the biggest generator of new jobs, the vast majority of small businesses fail with a few years. Government should recognize as private lenders do the risks inherent in lending to most small businesses and act in a prudent manner. The government has an incredibly poor track record of managing loan portfolios (again I note the above-mentioned GSEs). Why is it that Obama now believes that government will do a better job as the risk profile for many SBA loans and the potential for significant losses continues to increase? And why does Obama believe that companies formed as a result of SBA loans will actually generate sustainable job except in very limited instances, consistent with the average life cycle of such companies.
Obama has determined that the government via the Small Business Administration (SBA) is now going to guarantee small business loans up to $5 million. Those loans can be used not only to purchase inventory and equipment, as was the typical limitation in the past, but also now to finance real estate.
So, now the government can stick its fingers into another potential real estate rathole which hasn't worked in the past. Obama again has the uncanny knack of devising "solutions" that will end up socializing loan losses and privatizing business profits.
How is the government going to determine who qualifies for new SBA loans when banks are unwilling to lend to small businesses themselves? Perhaps the banks have good reason not to lend given the current uncertainties in the economy. Perhaps banks have learned their lesson that lending to questionably capitalized and non-creditworthy borrowers carries consequences.
Regardless of the lessons to be learned from the financial crisis, Obama is either oblivious to them or simply ignoring them for political expediency. His rationale for doing so is that since the banks won't loan to small businesses the government must do so instead. Is that a new form of underwriting standard: banks won't lend to prospective borrowers so the government should or must lend. Seems unwise and fraught with risk.
As a consequence, Obama is not allowing the free market system to function. In difficult economic times, unfortunately, lenders are forced to tighten lending standards and many businesses cannot obtain funding. But to put taxpayer money at risk when private lenders are unwilling to underwrite the same risks that the SBA will surely undertake sounds like a repeat of the Fannnie Mae/Freddie Mac debacle admittedly on a smaller scale.
While small business is usually the biggest generator of new jobs, the vast majority of small businesses fail with a few years. Government should recognize as private lenders do the risks inherent in lending to most small businesses and act in a prudent manner. The government has an incredibly poor track record of managing loan portfolios (again I note the above-mentioned GSEs). Why is it that Obama now believes that government will do a better job as the risk profile for many SBA loans and the potential for significant losses continues to increase? And why does Obama believe that companies formed as a result of SBA loans will actually generate sustainable job except in very limited instances, consistent with the average life cycle of such companies.
Obama Tanks Stock Market Again on SBA Plan
Someone in the White House should tell President Obama that every time he speaks about the economy or some new government program to artificially prop it up, the Stock Market tanks. Today he did it again.
Obama has determined that the government via the Small Business Administration (SBA) is now going to guarantee small business loans up to $5 million. Those loans can be used not only to purchase inventory and equipment, as was the typical limitation in the past, but also now to finance real estate. Brilliant idea. Not!
So, now the government can stick its fingers into another potential real estate rathole which hasn't worked in the past. Obama again has the uncanny knack of devising "solutions" that will end up socializing loan losses and privatizing business profits.
How is the government going to determine who qualifies for new SBA loans when banks are unwilling to lend to small businesses themselves? Perhaps the banks have good reason not to lend given the current uncertainties in the economy. Perhaps banks have learned their lesson that lending to questionably capitalized and non-creditworthy borrowers carries consequences.
Regardless of the lessons to be learned from the financial crisis, Obama is either oblivious to them or simply ignoring them for political expediency. His rationale for doing so is that since the banks won't loan to small businesses the government must do so instead. Is that a new form of underwriting standard: banks won't lend to prospective borrowers so the government should or must lend. Seems unwise and fraught with risk by me.
As a consequence, Obama is not allowing the free market system to function. In difficult economic times, unfortunately, lenders are forced to tighten lending standards and many businesses cannot obtain funding. But to put taxpayer money at risk when private lenders are unwilling to underwrite the same risks that the SBA will surely undertake sounds like a repeat of the Fannnie Mae/Freddie Mac debacle admittedly on a smaller scale.
While small business is usually the biggest generator of new jobs, the vast majority of small businesses fail with a few years. Government should recognize as private lenders do the risks inherent in lending to most small businesses and act in a prudent manner. The government has an incredibly poor track record of managing loan portfolios (again I note the above-mentioned GSEs). Why is it that Obama now believes that government will do a better job as the risk profile for many SBA loans and the potential for significant losses continues to increase? And why does Obama believe that companies formed as a result of SBA loans will actually generate sustainable job except in very limited instances, consistent with the average life cycle of such companies.
Obama has determined that the government via the Small Business Administration (SBA) is now going to guarantee small business loans up to $5 million. Those loans can be used not only to purchase inventory and equipment, as was the typical limitation in the past, but also now to finance real estate. Brilliant idea. Not!
So, now the government can stick its fingers into another potential real estate rathole which hasn't worked in the past. Obama again has the uncanny knack of devising "solutions" that will end up socializing loan losses and privatizing business profits.
How is the government going to determine who qualifies for new SBA loans when banks are unwilling to lend to small businesses themselves? Perhaps the banks have good reason not to lend given the current uncertainties in the economy. Perhaps banks have learned their lesson that lending to questionably capitalized and non-creditworthy borrowers carries consequences.
Regardless of the lessons to be learned from the financial crisis, Obama is either oblivious to them or simply ignoring them for political expediency. His rationale for doing so is that since the banks won't loan to small businesses the government must do so instead. Is that a new form of underwriting standard: banks won't lend to prospective borrowers so the government should or must lend. Seems unwise and fraught with risk by me.
As a consequence, Obama is not allowing the free market system to function. In difficult economic times, unfortunately, lenders are forced to tighten lending standards and many businesses cannot obtain funding. But to put taxpayer money at risk when private lenders are unwilling to underwrite the same risks that the SBA will surely undertake sounds like a repeat of the Fannnie Mae/Freddie Mac debacle admittedly on a smaller scale.
While small business is usually the biggest generator of new jobs, the vast majority of small businesses fail with a few years. Government should recognize as private lenders do the risks inherent in lending to most small businesses and act in a prudent manner. The government has an incredibly poor track record of managing loan portfolios (again I note the above-mentioned GSEs). Why is it that Obama now believes that government will do a better job as the risk profile for many SBA loans and the potential for significant losses continues to increase? And why does Obama believe that companies formed as a result of SBA loans will actually generate sustainable job except in very limited instances, consistent with the average life cycle of such companies.
Thursday, February 4, 2010
Is Eric Holder Seriously Defending His Blunder?
Why is it so hard for Eric Holder to accept the fact that he bungled the decision to treat the "underwear bomber", Umar Farouk Abdulmutallab, as a criminal defendant in the U.S. Courts as opposed to an enemy combatant? As an immediate consequence of that decision, the FBI's interrogation of Abdulmutallab on Christmas Day, which was yielding potential valuable national security information, was abruptly curtailed to "mirandize" him. Thereupon, Abulmutallab was given a court-appointed lawyer and thereafter refused to answer any further questions. Holder seemingly made this ill-thought-out decision without consulting senior military personnel, the Department of Homeland Security or the President.
Why did Holder act unilaterally and so abruptly? Whatever legal justifications may have been offered then, Holder's decision was primarily political as opposed to being the only possible result under federal or martial law. Clearly, before the Attorney General or anyone can determine the appropriate forum for trying an individual under the circumstances at hand, the individual's status as an enemy combatant or not must be resolved not the other way around. However, in an effort to distance itself from the Bush Administration and Guantanamo Bay and to demonstrate to the world that the United States is now operating under a different set of legal guidelines than previously employed under the Bush Administration, the chief legal officer of the Obama Administration wasted no time in appeasing America's critics as opposed to arriving at the best course of legally justifiable action for the United States. This would be gross malfeasance for any legal officer of the U.S., but it is absolutely unconscionable for the U.S. Attorney General to act in such a self-righteous and self-serving manner.
No person, not even the Attorney General, was entitled to determine by himself whether Abulmutallab was an "ordinary" criminal defendant or an enemy combatant. The only reason for his precipitous behavior must have been to cut off, silence or preclude any debate on that question. And lo and behold, now Holder has much explaining to do. Yet despite the overwhelming condemnation of his conduct, Holder continues to insist that Abulmutallab actions can be addressed through the criminal justice system.
Whether or not that is true is beyond the point. The question is whether Holder should have made the decision he made in the manner he made it. Holder seems less than prepared to argue the merits of that question.
Why did Holder act unilaterally and so abruptly? Whatever legal justifications may have been offered then, Holder's decision was primarily political as opposed to being the only possible result under federal or martial law. Clearly, before the Attorney General or anyone can determine the appropriate forum for trying an individual under the circumstances at hand, the individual's status as an enemy combatant or not must be resolved not the other way around. However, in an effort to distance itself from the Bush Administration and Guantanamo Bay and to demonstrate to the world that the United States is now operating under a different set of legal guidelines than previously employed under the Bush Administration, the chief legal officer of the Obama Administration wasted no time in appeasing America's critics as opposed to arriving at the best course of legally justifiable action for the United States. This would be gross malfeasance for any legal officer of the U.S., but it is absolutely unconscionable for the U.S. Attorney General to act in such a self-righteous and self-serving manner.
No person, not even the Attorney General, was entitled to determine by himself whether Abulmutallab was an "ordinary" criminal defendant or an enemy combatant. The only reason for his precipitous behavior must have been to cut off, silence or preclude any debate on that question. And lo and behold, now Holder has much explaining to do. Yet despite the overwhelming condemnation of his conduct, Holder continues to insist that Abulmutallab actions can be addressed through the criminal justice system.
Whether or not that is true is beyond the point. The question is whether Holder should have made the decision he made in the manner he made it. Holder seems less than prepared to argue the merits of that question.
Nancy Pelosi Actions Are Anti-American
Has Nancy Pelosi ever seen a big government program she didn't like? No, except for anything defense related. She has an uncanny knack for being completely and consistently at odds with anything that will actually improve the economy, increase private job creation or make the country more secure. It is incredible to me that this woman is serving as Speaker of The House, let alone that was even elected to Congress.
Apparently, she believes that continued expansion of government is the answer to all social evils even as the country is drowning in debt. Even a moron in a hurry should understand that only the private sector can create lasting jobs which are net positive to the tax base. Stated differently, if the government has to spend more in tax dollars to create a job than the government will collect in taxes and productive economic value therefrom, the taxpayer is the loser. This is an elemental concept yet she is too busy flying off in military airplanes (along with select friends, allies and family) befitting of her exalted status as Speaker, oftentimes to venues such as Copenhagen to support policies contrary to the best interests of American business (and, concomitantly, the American worker).
I sometimes wonder if Pelosi even understands that the United States is not an instrument of the United Nations or that blaming George W. Bush and the United States for the world's problems is beyond her powers of logic to cohere.
Apparently, she believes that continued expansion of government is the answer to all social evils even as the country is drowning in debt. Even a moron in a hurry should understand that only the private sector can create lasting jobs which are net positive to the tax base. Stated differently, if the government has to spend more in tax dollars to create a job than the government will collect in taxes and productive economic value therefrom, the taxpayer is the loser. This is an elemental concept yet she is too busy flying off in military airplanes (along with select friends, allies and family) befitting of her exalted status as Speaker, oftentimes to venues such as Copenhagen to support policies contrary to the best interests of American business (and, concomitantly, the American worker).
I sometimes wonder if Pelosi even understands that the United States is not an instrument of the United Nations or that blaming George W. Bush and the United States for the world's problems is beyond her powers of logic to cohere.
Tuesday, February 2, 2010
Reid Suddenly Cares About Individual Liberty When Vegas Is Concerned
Harry Reid is a stalwart liberal progressive, willing to lead the charge for massive government expansion and intrusion into individual affairs except, apparently, when that conflicts with political reality. As reported in Politico.com, Reid chastised President Obama for suggesting that Americans "... not blow a load of cash in Vegas when you're trying to save for college." And a fellow Nevada Democratic Congresswoman, Shelley Berkley was even more direct: "Enough is enough!" she said. "President Obama needs to stop picking on Las Vegas and he needs to let Americans decide for themselves how and where to spend their hard earned vacation dollars. (Emphasis supplied.)
While I agree, in this instance, with the sentiments expressed by the now conveniently one-issue libertarian Nevada politicos, it is difficult to reconcile their view that "hard-earned vacation dollars" should be spent by Americans at they see fit, but the same control over their finances does not apply to the rest of their money. The difference is merely provincialism. Reid and his aforementioned cohort understand that tourism is the business of Las Vegas and any effort to derail it will hurt their constituents and their respective reelection bids. But why is this obvious, especially to Majority Leader Reid, only when his own political interests are affected? Why isn't this basic American concept that people should be able to spend their money as they choose not equally relevant to decisions regarding healthcare and education and government bailouts?
Either Reid is oblivious to the inherent contradiction in his political views over the nature, extent and application of individual liberties of Americans or he is intellectually dishonest and, even worse, a hypocrite. Do as I say and not as I do should be Reid's campaign slogan as the Majority Leader's power or the fear of losing it has gone to his non-thinking head.
When are liberals like Reid going to realize that in all aspects of their financial and personal affairs, Americans should be of the same dominion? I fear not soon or never because Reid doesn't have a consistent political viewpoint other than trying to shove an ulta-liberal, progressive agenda down the collective throat of the electorate without regard for the Constitution and individual rights and the limits of government.
While I agree, in this instance, with the sentiments expressed by the now conveniently one-issue libertarian Nevada politicos, it is difficult to reconcile their view that "hard-earned vacation dollars" should be spent by Americans at they see fit, but the same control over their finances does not apply to the rest of their money. The difference is merely provincialism. Reid and his aforementioned cohort understand that tourism is the business of Las Vegas and any effort to derail it will hurt their constituents and their respective reelection bids. But why is this obvious, especially to Majority Leader Reid, only when his own political interests are affected? Why isn't this basic American concept that people should be able to spend their money as they choose not equally relevant to decisions regarding healthcare and education and government bailouts?
Either Reid is oblivious to the inherent contradiction in his political views over the nature, extent and application of individual liberties of Americans or he is intellectually dishonest and, even worse, a hypocrite. Do as I say and not as I do should be Reid's campaign slogan as the Majority Leader's power or the fear of losing it has gone to his non-thinking head.
When are liberals like Reid going to realize that in all aspects of their financial and personal affairs, Americans should be of the same dominion? I fear not soon or never because Reid doesn't have a consistent political viewpoint other than trying to shove an ulta-liberal, progressive agenda down the collective throat of the electorate without regard for the Constitution and individual rights and the limits of government.
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