09 May, 2013

Benghazi

Questions for the administration:

  • Why was the Benghazi embassy without military protection on Sept 11 (clearly a day of interest) in a volatile country with nearby enemies?
  • Is it common to leave our middle-east outposts without military protection?  If so, why?
  • Why were military units not immediately sent to the Benghazi upon report of the attack (note that this question still stands even if we believe it was a "spontaneous protest")?
  • The administration claims it would have taken hours for military personnel to arrive on site - does this not suggest the need for additional military funding to improve response time?
  • Why did UN Ambassador Susan Rice go on TV the next day and claim in multiple interviews that Benghazi was the result of a protest when it is now apparent the administration clearly knew it was a coordinated attack?
  • What is the status of the President's pledge to "bring to justice" the individuals responsible for the death of three Americans?
  • How can Secretary Clinton say "What difference, at this point, does it make" regarding whether or not it was a coordinated attack or a spontaneous protest?  Notice that in her next sentence she says it is her job to "figure out what happened and do everything we can to prevent it from happening again" - how can she do that if she is indifferent to the cause and actions leading to the attack?
Very disappointed that this is not receiving more scrutiny.

14 February, 2013

Work Disincentives, Still Crazy After All These Years

Work Disincentives, Still Crazy After All These Years

By ARTHUR LAFFER

It is tempting to dismiss the role played by incentives in economics, but the persistence of poverty in the inner city and elsewhere is difficult to explain with any other view of human behavior. Poor people, like everyone else, respond to incentives. The dilemma is how to introduce market incentives while still maintaining a generous system of helping those in need.

The first step is to consider the role played by disincentives, whether they are disincentives to work because government benefits fall away as income rises, or disincentives that make employers reluctant to hire entry-level workers likely to come from the ranks of the young unemployed.

More than three decades ago, I began enumerating a myriad of government "needs tested" programs that diminished welfare benefits as their recipients earned more income. The loss of government benefits made earning more income less attractive to many low-income families, an effect similar to that of raising marginal tax rates.

In the intervening years, alas, very little has changed. Gary Alexander, secretary of public welfare for the State of Pennsylvania, made that quite clear in a July presentation to the American Enterprise Institute entitled "Welfare's Failure and the Solution," an analysis of the welfare benefits plus wages of a single mother of two young children living in Pennsylvania.

Mr. Alexander reports that a single mother of two in the Keystone State earning no wages will obtain welfare benefits—such as food stamps, child care and Medicaid services—worth more than $45,000 annually. If the woman begins earning wages, her total annual income, including the value of her welfare benefits, will rise as well—up to about $9,000 in wages. But the next $5,000 in wages will not increase her total income, because she will lose some Medicaid and other benefits. In short, she faces the equivalent of a 100% marginal tax.

From about $14,000 to $29,000 of gross wages, she will also lose government benefits such that her total annual income will rise only about $5,000—an effective marginal tax rate of 67%. At $29,000 of wages, the woman will realize a little less than $57,000 in net income plus benefits. Once she earns more than $29,000 in wages her housing subsidies and food subsidies drop way down. With wages above $43,000, her child-care subsidies disappear, and once her wages top $57,000 her family will no longer qualify for the Children's Health Insurance Program.

What this means is that her total income—welfare benefits plus wages, minus taxes—won't reach $57,000 until her gross wage income rises to $69,000. In other words, the money earned by her between $29,000 and $69,000 faces a marginal tax rate, on average, of 100%. She receives no net benefit from her labor. Now if that doesn't motivate you to get up and go to work, I don't know what will.

This example is particular to a single mother in Pennsylvania with two children, but the principles apply generally across the country. People with low incomes who receive various forms of welfare subsidies in any number of states—with and without children, whether married or not—face enormous disincentives in trying to improve their lives by working. And these barriers to self-improvement through work have been rising over time.

According to the most recent Census Bureau data, the percentage of the American population in 2011 living below the poverty line was 15%, tied for a 50-year high and well above the 11.4% in the late 1970s when I began calling attention to "needs tested" disincentives to work.

Using employment as a share of total population for especially vulnerable demographics, the consequences of poorly thought-out policies are stark.

Consider the predicament of teenagers 16 to 19 years old, whose employment-to-population ratio has been 26%—about one in four young people employed—for the past three years. In the period 1975-2002, the ratio was in a healthier 40%-50% range. For African-Americans 16 to 19 years old, the employment-to-population ratio for the past four years has been in the anemic 14.5% to 16.5% range.

Minimum-wage laws ostensibly intended to help the young and poor may have put a bit more money in the pockets of those who found work, but study after study indicates that governmental minimum-wage interventions discourage employers from hiring.

How to counter these disincentives? My preferred solution is to enact a form of enterprise zone where marginal tax rates would be greatly lowered for both employers and employees in areas with high poverty. For starters, employer and employee payroll taxes could be eliminated for people who both live and work in the enterprise zones. There would be scant revenue loss to the U.S. Treasury because few people are working in these areas anyway.

Second, tax rates on corporate profits and personal income could also be reduced in the enterprise zones for businesses and employees whose principal residence is in the enterprise zone. Potential workers need employers after all. Once these residents see that their pay will not be whittled away by payroll and income taxes, they will not be so disinclined to sacrifice the government benefits that would recede as their income increases.

Developing business and life skills through on-the-job training is crucial for populations suffering generational poverty. To help make youth employment in the country's poorest areas more attractive, enterprise zones should eliminate job-killing state and federal minimum wage requirements for workers under 21. (The "youth minimum wage" provision allows payment of $4.25 an hour to workers under age 20 instead of the federal $7.25 minimum wage, but the rate expires after 90 days.)

After being unemployed for a number of years, poor, unskilled youths often become unemployable. And, after being unemployable for a number of years, many of them quite understandably become hostile to the world, and society has to spend fortunes protecting itself from them. It is a dispiriting Catch-22.

In the spirit of the late, great New York Rep. Jack Kemp, the time is right to take up the cause of a bipartisan pro-growth agenda for America's pockets of poverty.

07 February, 2013

Barbara Boxer Op-Ed


I love it when politicians say things like “we'll apply the savings from ending the Iraq and Afghanistan wars to the deficit”.  Um…funds appropriated for those wars were not intended to be indefinite spending.  You don't have any “savings” from ending those conflicts.  This is even worse than her other argument, that we have “already” cut $1.2T.  Again, spending avoidance is not spending reduction.  What does she really want to cut?  Nothing!  No wonder every Republican proposal looks like the “hard way”.  In her mind, she shouldn't have to make any hard choices.   

Hey media, any time you want to ask a remotely challenging question, have at it.  Here’s one to get you started “What, specifically, do you recommend we cut?  If you propose no cuts, do you believe the debt and deficit are immaterial and we can continue spending 50% more than we take in each year?”.


24 January, 2013

I think this is an interesting double standard.  Chick-Fil-a's CEO made a controversial public statement earlier this summer and criticism, boycotts and protests ensued.  John Mackey's comments, however, do not receive nearly the same attention or vitriol.  Could it be that liberals like Whole Foods, and they do not like Chick-Fil-a?  Could it really be that simple?

Whole Foods' CEO Mackey Is Right—ObamaCare Is Like Fascism

By ROBERT ROMANO
Investors.com
Posted 01/22/2013 07:01 PM ET

In 2009, when Whole Foods CEO John Mackey in a Wall Street Journal op-ed compared the health care "public option" then under consideration by Congress to socialism — a nationalized economic system wherein the government owns the means of production — hardly anyone batted an eyelash.

Sure, at the time, the left-wing site Daily Kos called for a boycott. And a Facebook group at the time managed to find a couple hundred users angry about the characterization. Whole Foods set up a special forum for customers to express their views on the op-ed.

But it was hardly the response Whole Foods got when on Jan. 16 in an NPR interview, Mackey was asked a follow-up question on what he thought about the current law.

After all, the "public option" was never adopted. What came afterward, now known in popular vernacular as ObamaCare, was a mishmash of mandates, regulations and price controls — but fell short of an outright nationalization of the insurance industry.

That was when Mackey used the F-word. No, not that one. The other one.

"Technically speaking, it's more like fascism," Mackey said in the NPR interview, adding, "Socialism is where the government owns the means of production. In fascism, the government doesn't own the means of production, but they do control it, and that's what's happening with our health care programs and these reforms."

That set off a firestorm, largely again from the political left all but calling for Mackey's head.

Since then, Mackey has walked back his statement, calling it a "bad choice of language," but all the while sticking to his essential point.

He explained, "I was trying to distinguish it between socialism so I took the dictionary definition of fascism, which is when the means of production are still owned privately but the government controls it — that's a type of fascism. However, I realize that that word has so much baggage associated with it from World War II, with Germany, with Italy and Spain, that's a very provocative word, so I regret using it."

Fair enough. On one hand, fascism certainly is a controversial term. And on the other, what Mackey described certainly would fit well within the academic definition of fascism. Or more specifically, corporatism, which was the economic theory that undergirded the fascist ideology.

The fascist strain of corporatism was the brainchild of Alfredo Rocco, a key figure in Benito Mussolini's fascist regime in Italy in the 1920s and 1930s.

It called for the organization of the economy into corporate sectors that would cooperate with the government in implementing state policy.

Its tenets, neatly defined by Roland Sarti in "Italy: A Reference Guide from the Renaissance to the Present," called for "uniting workers, entrepreneurs, and government officials in economic activities, carried out in the public interest or the interests of the state ... (and) eliminating conflicts of interest among labor, business and government."

Or as Rocco put it, "For Fascism, society is the end, individuals the means, and its whole life consists in using individuals as instruments for its social ends."

Certainly, that's what ObamaCare — with its individual and employer mandates to respectively purchase and to provide health insurance — seeks to accomplish.

It guarantees customers to large companies, in this case insurance providers that supported passage of the legislation, and in the process cartelizes the system.

In other words, private profits are being embedded into the law, and enforced by the bureaucracy, which will levy fines on individuals and employers that fail to comply with the mandates.

The purpose, ostensibly, is to reduce health care costs, a stated goal of the legislation, by increasing the pool of the insured.

When that fails, as surely it will, whoever cannot afford the insurance will then be subsidized through the state and federal-run exchanges — monies that of course will pass directly to the insurance companies and health care providers.

But the level of state control in this new system, and insurance industry participation in implementing it to its own benefit, is undeniable. It is corporatism defined.

One could compare it to the National Industrial Recovery Act of 1933 that implemented the National Recovery Administration, which may have been patterned after Mussolini's labor laws, as summarized in a 1991 Yale Law School study by James Whitman, before it was subsequently overturned by the Supreme Court.

Or the Federal Reserve Act of 1913, which gave privately owned banks the power to appoint regional Fed chairmen and outsourced creation of the public currency to a banking cartel.

Or more recently, one might examine the Troubled Asset Relief Fund (TARP), Dodd-Frank's "orderly liquidation fund" and the Fed's continued mortgage-backed securities purchase program — all bailout programs that privatize profits and socialize losses in the financial sector. More corporatism.

In that context, ObamaCare actually fits in a long line of fascist-like ideas being implemented in the U.S. that feed the bottom lines of very large companies — all at public expense.

To be fair, corporatism does predate fascism as an idea, but it heavily influenced that ideology and its policies that were implemented in Italy, Germany, and elsewhere such that, today, they can almost be used synonymously in an academic sense.

Mackey obviously does not prefer this approach to economic policy, and so chose the highly charged fascist label. He could have just as easily called it corporatist and would have been equally accurate.

In short, Mackey was spot on. Perhaps the only thing he really regrets was telling the truth.

Shopping Around for a Better Life

Shopping Around for a Better Life

By John Stossel - January 23, 2013

Thanks, California! Thanks for your monstrous spending and absurd regulatory overreach! America needs you. We need Connecticut and Illinois, too! We need you the way we needed the Soviet Union, as models of failure, to warn us what happens if we believe those who say, "Government can."

Moving to California was once the dream for many Americans. Its population grew at almost triple the national average -- until 1990. Then big government, in the form of endless regulation and taxes, killed much of the dream. In the last decade, 2 million people left California.

Many of them moved to Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington or Wyoming. More on what makes those states special in a moment.

When the USSR died, overthrown by its own citizens' hatred of central planning, I assumed the world would acknowledge that big government is a nightmare. But people don't. Our brains are programmed to believe that "next time, central planning will help." So, many people forget the lesson of the USSR.

Fortunately, they can still watch what's happening right now in California, Illinois and Connecticut. OK, those states are not totalitarian dictatorships, but they tax and micromanage so much that they will soon approach bankruptcy, cut services and stagnate.

And Americans have an advantage Soviet citizens never had: 50 states. If we live in a big-government state, we can move. I did.

I grew up in Illinois. It was nice enough (except in winter). But gradually its politicians gave away its future.

I moved to New York City, no political paradise, but where the big TV news jobs are. And maybe New York's promises to unions won't bankrupt us too soon.

I could always move again. I would still be smothered by federal rules, but at least I can move to a place with fewer onerous state rules.

A group called the Free State Project invites us to move to New Hampshire to help create "liberty in our lifetime." It's too early to see how that will work out, but that state now has a booming population of libertarians and anarchists. One even got elected to the state legislature after running against his own roommate, also a libertarian, whom he accused of not being anti-government enough.

Americans who want to escape state income taxes and live near better job prospects can move to one of those nine states that I mentioned above.

It's no surprise they produce more jobs. Without an income tax, those states were forced to limit the growth of their governments, so they did. Every state has schools, social service programs, prisons, etc., but those states find a way to fund those things for less. Then they reap benefits.

Last decade, those nine states gained population and increased jobs by 4.9 percent; jobs in the rest of the states declined by 2.6 percent.

It's good that we have places like Texas and New Hampshire to which fed-up citizens can escape. In Europe, you'd have to leave your country to escape its worst laws.

French actor Gerard Depardieu just moved to Belgium to escape France's proposed 75 percent tax on the rich. Years ago, high taxes in Britain drove Rod Stewart to move to Los Angeles. But by 2010, California's taxes had risen, and Stewart moved back to England. (He doesn't claim the reason was taxes; he said his child could get a better education in England.)

Dan Mitchell of the Cato Institute summed up California's situation for me. "The politicians want to get re-elected, and the state government workers want to get as much as they can before the whole house of cards comes tumbling down. California is Greece -- the Greece of America."

I hope all Americans watch and learn from states like California. But if we don't, and if people keep electing big-government politicians, at least Americans, unlike the Greeks, can hop around between 50 states, trying to stay one step ahead of bad laws and ruin.

Something to be celebrated?


  1. I think it is sad we believe this "anniversary" should be celebrated.
  2. Is this supposed to be funny?  Why would you treat the "right" to kill an unborn child like it is a relationship to be commemorated with flowers and romance?  Hopefully even those who support a woman's right to choose would agree there's something very strange about this presentation.

18 January, 2013

I think the line about being poor being the best investment is a bit much, but the cited facts are pretty striking.  I wish the author would source his statistics.


28 November, 2012

Outstanding Benghazi Questions

Excellent questions, Senator Collins!

Make Up Turned Break Up
By MAUREEN DOWD

Are the Republican senators unreasonable? Or is the secretary of state-manqué undiplomatic? Did the senators sandbag Susan Rice? Or did Rice further inflame a tense situation? Is it a case of shooting the messenger and playing politics? Or is national security dangerously infected with politics?

It seems as if it would have been simple enough for Rice to quickly admit that the administration talking points she used on the Sept. 16 Sunday shows about the slaughter in Benghazi were misleading. But she went silent. She has no wartime consigliere and, aside from the president’s angry postelection defense of Rice, the White House — perhaps relieved that she was taking the heat rather than the president — wasn’t running a strong damage control operation that clarified matters.

Still, on last Sunday’s talk shows, John McCain and Lindsey Graham softened their tone a bit. “She’s not the problem,” McCain said. “The problem is the president of the United States,” for failing to swiftly tell Americans what his intelligence agencies had confirmed: that Benghazi was a terrorist attack involving Al Qaeda affiliates.

When Rice asked to come to the Hill to meet with some of her Republican critics, it seemed détente was nigh. But somehow the hour-and-a-half powwow caused an escalation, with McCain, Graham and Senator Kelly Ayotte of New Hampshire emerging to say they had more reservations than before. Senator Bob Corker of Tennessee, who’s scheduled to meet with Rice on Wednesday, suggested that she would be better suited to run the Democratic National Committee than State. If Rice can’t soothe the egos of some cranky G.O.P. pols, how would she negotiate with China?

Senator Susan Collins of Maine, the soft-spoken ranking member on the homeland security committee, hasn’t been part of this shrill debate. Though they had met only once or twice, Collins agreed to introduce Rice to the Foreign Relations Committee in 2009 when Rice was nominated as the U.S. ambassador to the U.N. Rice’s grandparents immigrated from Jamaica to Portland, Maine.

“I don’t bear any animus to her at all,” the senator said. “In fact, to the contrary.”

But she said she is “troubled” by Rice’s role. “If I wanted to be secretary of state,” Collins observed, “I would not go on television and perform what was essentially a political role.”

Collins drew up a list of questions to ask Rice at their one-on-one hourlong meeting slated for Wednesday. She wants Rice to explain how she could promote a story “with such certitude” about a spontaneous demonstration over the anti-Muslim video that was so at odds with the classified information to which the ambassador had access. (It was also at odds with common sense, given that there were Al Qaeda sympathizers among the rebel army members that overthrew Muammar el-Qaddafi with help from the U.S. — an intervention advocated by Rice — and Islamic extremist training camps in the Benghazi area.)

The F.B.I. interviewed survivors of the attack in Germany and, according to some senators, had done most of the interviews of those on site by Sept. 15, the day before Rice went on TV, and established that there was no protest. Collins wants to learn if the F.B.I. had failed to communicate that, or if they had communicated it and Rice went ahead anyway?

When Rice heard the president of the Libyan National Congress tell Bob Schieffer on “Face the Nation,” right before her appearance, that 50 people had been arrested who were either foreign or affiliated with or sympathized with Al Qaeda, why did she push back with the video story? “Why wouldn’t she think what the Libyan president said mattered?” Collins wondered.

Why did Rice say on ABC News’s “This Week,” that “two of the four Americans who were killed were there providing security”? Rice was referring to the two ex-Navy SEAL team members who were C.I.A. security officers working on a base about a mile away. “They weren’t there to protect Ambassador Stevens,” Collins said. “That wasn’t their job.”

Rice also said that “we had a substantial security presence with our personnel” — which was clearly not the case. Collins wants to know Rice’s basis for saying on ABC that the attacks were “a direct result of a heinous and offensive video.” And why did she say “a small number of people” came to the consulate to protest, when that phrase is not in her talking points? Collins is curious why Rice is not angrier, if, as she insists, she was repeating what she was told. “I’d be furious at the White House and F.B.I. and intelligence community for destroying my credibility,” the senator said.

Collins said that before she would support Rice for secretary of state, she needs to ascertain what was really going on. “Did they think admitting that it was an Al Qaeda attack would destroy the narrative of Libya being a big success story?” Collins asked. As one of the administration champions of intervening in Libya, Rice was surely rooting for that success story herself.

18 October, 2012

Shut Up and Play Nice: How the Western world is Limiting Free Speech

Shut Up and Play Nice: How the Western world is Limiting Free Speech

By Jonathan Turley, Published: October 12

Free speech is dying in the Western world. While most people still enjoy considerable freedom of expression, this right, once a near-absolute, has become less defined and less dependable for those espousing controversial social, political or religious views. The decline of free speech has come not from any single blow but rather from thousands of paper cuts of well-intentioned exceptions designed to maintain social harmony.

In the face of the violence that frequently results from anti-religious expression, some world leaders seem to be losing their patience with free speech. After a video called “Innocence of Muslims” appeared on YouTube and sparked violent protests in several Muslim nations last month, U.N. Secretary General Ban Ki-moon warned that “when some people use this freedom of expression to provoke or humiliate some others’ values and beliefs, then this cannot be protected.”

It appears that the one thing modern society can no longer tolerate is intolerance. As Australian Prime Minister Julia Gillard put it in her recent speech before the United Nations, “Our tolerance must never extend to tolerating religious hatred.”

A willingness to confine free speech in the name of social pluralism can be seen at various levels of authority and government. In February, for instance, Pennsylvania Judge Mark Martin heard a case in which a Muslim man was charged with attacking an atheist marching in a Halloween parade as a “zombie Muhammed.” Martin castigated not the defendant but the victim, Ernie Perce, lecturing him that “our forefathers intended to use the First Amendment so we can speak with our mind, not to piss off other people and cultures — which is what you did.”

Of course, free speech is often precisely about pissing off other people — challenging social taboos or political values.

This was evident in recent days when courts in Washington and New York ruled that transit authorities could not prevent or delay the posting of a controversial ad that says: “In any war between the civilized man and the savage, support the civilized man. Support Israel. Defeat jihad.”

When U.S. District Judge Rosemary Collyer said the government could not bar the ad simply because it could upset some Metro riders, the ruling prompted calls for new limits on such speech. And in New York, the Metropolitan Transportation Authority responded by unanimously passing a new regulation banning any message that it considers likely to “incite” others or cause some “other immediate breach of the peace.”

Such efforts focus not on the right to speak but on the possible reaction to speech — a fundamental change in the treatment of free speech in the West. The much-misconstrued statement of Justice Oliver Wendell Holmes that free speech does not give you the right to shout fire in a crowded theater is now being used to curtail speech that might provoke a violence-prone minority. Our entire society is being treated as a crowded theater, and talking about whole subjects is now akin to shouting “fire!”

The new restrictions are forcing people to meet the demands of the lowest common denominator of accepted speech, usually using one of four rationales.

Speech is blasphemous

This is the oldest threat to free speech, but it has experienced something of a comeback in the 21st century. After protests erupted throughout the Muslim world in 2005 over Danish cartoons depicting the prophet Muhammad, Western countries publicly professed fealty to free speech, yet quietly cracked down on anti-religious expression. Religious critics in France, Britain, Italy and other countries have found themselves under criminal investigation as threats to public safety. In France, actress and animal rights activist Brigitte Bardot has been fined several times for comments about how Muslims are undermining French culture. And just last month, a Greek atheist was arrested for insulting a famous monk by making his name sound like that of a pasta dish.

Some Western countries have classic blasphemy laws — such as Ireland, which in 2009 criminalized the “publication or utterance of blasphemous matter” deemed “grossly abusive or insulting in relation to matters held sacred by any religion.” The Russian Duma recently proposed a law against “insulting religious beliefs.” Other countries allow the arrest of people who threaten strife by criticizing religions or religious leaders. In Britain, for instance, a 15-year-old girl was arrested two years agofor burning a Koran.

Western governments seem to be sending the message that free speech rights will not protect you — as shown clearly last month by the images of Nakoula Basseley Nakoula, the YouTube filmmaker, being carted away in California on suspicion of probation violations. Dutch politician Geert Wilders went through years of litigation before he was acquitted last year on charges of insulting Islam by voicing anti-Islamic views. In the Netherlandsand Italy, cartoonists and comedians have been charged with insulting religion through caricatures or jokes.

Even the Obama administration supported the passage of a resolution in the U.N. Human Rights Council to create an international standard restricting some anti-religious speech (its full name: “Combating Intolerance, Negative Stereotyping and Stigmatization of, and Discrimination, Incitement to Violence and Violence Against, Persons Based on Religion or Belief”). Egypt’s U.N. ambassador heralded the resolution as exposing the “true nature” of free speech and recognizing that “freedom of expression has been sometimes misused” to insult religion.

At a Washington conference last yearto implement the resolution, Secretary of State Hillary Rodham Clinton declared that it would protect both “the right to practice one’s religion freely and the right to express one’s opinion without fear.” But it isn’t clear how speech can be protected if the yardstick is how people react to speech — particularly in countries where people riot over a single cartoon. Clinton suggested that free speech resulting in “sectarian clashes” or “the destruction or the defacement or the vandalization of religious sites” was not, as she put it, “fair game.”

Given this initiative, President Obama’s U.N. address last month declaring America’s support for free speech, while laudable, seemed confused — even at odds with his administration’s efforts.

Speech is hateful

In the United States, hate speech is presumably protected under the First Amendment. However, hate-crime laws often redefine hateful expression as a criminal act. Thus, in 2003, the Supreme Court addressed the conviction of a Virginia Ku Klux Klan member who burned a cross on private land. The court allowed for criminal penalties so long as the government could show that the act was “intended to intimidate” others. It was a distinction without meaning, since the state can simply cite the intimidating history of that symbol.

Other Western nations routinely bar forms of speech considered hateful. Britain prohibits any “abusive or insulting words” meant “to stir up racial hatred.” Canada outlaws “any writing, sign or visible representation” that “incites hatred against any identifiable group.” These laws ban speech based not only on its content but on the reaction of others. Speakers are often called to answer for their divisive or insulting speech before bodies like the Canadian Human Rights Tribunal.

This month, a Canadian court ruled that Marc Lemire, the webmaster of a far-right political site, could be punished for allowing third parties to leave insulting comments about homosexuals and blacks on the site. Echoing the logic behind blasphemy laws, Federal Court Justice Richard Mosley ruled that “the minimal harm caused . . . to freedom of expression is far outweighed by the benefit it provides to vulnerable groups and to the promotion of equality.”

Speech is discriminatory

Perhaps the most rapidly expanding limitation on speech is found in anti-discrimination laws. Many Western countries have extended such laws to public statements deemed insulting or derogatory to any group, race or gender.

For example, in a closely watched case last year, a French court found fashion designer John Gallianoguilty of making discriminatory comments in a Paris bar, where he got into a cursing match with a couple using sexist and anti-Semitic terms. Judge Anne-Marie Sauteraud read a list of the bad words Galliano had used, adding that she found (rather implausibly) he had said “dirty whore” at least 1,000 times. Though he faced up to six months in jail, he was fined.

In Canada, comedian Guy Earle was charged with violating the human rights of a lesbian couple after he got into a trash-talking session with a group of women during an open-mike night at a nightclub. Lorna Pardysaid she suffered post-traumatic stress because of Earle’s profane language and derogatory terms for lesbians. The British Columbia Human Rights Tribunal ruled last year that since this was a matter of discrimination, free speech was not a defense, and awarded about $23,000 to the couple.

Ironically, while some religious organizations are pushing blasphemy laws, religious individuals are increasingly targeted under anti-discrimination laws for their criticism of homosexuals and other groups. In 2008, a minister in Canada was not only forced to pay fines for uttering anti-gay sentiments but was also enjoined from expressing such views in the future.

Speech is deceitful

In the United States, where speech is given the most protection among Western countries, there has been a recent effort to carve out a potentially large category to which the First Amendment would not apply. While we have always prosecuted people who lie to achieve financial or other benefits, some argue that the government can outlaw any lie, regardless of whether the liar secured any economic gain.

One such law was the Stolen Valor Act, signed by President George W. Bush in 2006, which made it a crime for people to lie about receiving military honors. The Supreme Court struck it down this year, but at least two liberal justices, Stephen Breyer and Elena Kagan, proposed that such laws should have less of a burden to be upheld as constitutional. The House responded with new legislation that would criminalize lies told with the intent to obtain any undefined “tangible benefit.”

The dangers are obvious. Government officials have long labeled whistleblowers, reporters and critics as “liars” who distort their actions or words. If the government can define what is a lie, it can define what is the truth.

For example, in Februarythe French Supreme Court declared unconstitutional a law that made it a crime to deny the 1915 Armenian genocide by Turkey — a characterization that Turkey steadfastly rejects. Despite the ruling, various French leaders pledged to pass new measures punishing those who deny the Armenians’ historical claims.


The impact of government limits on speech has been magnified by even greater forms of private censorship. For example, most news organizations have stopped showing images of Muhammad, though they seem to have no misgivings about caricatures of other religious figures. The most extreme such example was supplied by Yale University Press, which in 2009 published a book about the Danish cartoons titled “The Cartoons That Shook the World” — but cut all of the cartoons so as not to insult anyone.

The very right that laid the foundation for Western civilization is increasingly viewed as a nuisance, if not a threat. Whether speech is deemed imflammatory or hateful or discriminatory or simply false, society is denying speech rights in the name of tolerance, enforcing mutual respect through categorical censorship.

As in a troubled marriage, the West seems to be falling out of love with free speech. Unable to divorce ourselves from this defining right, we take refuge instead in an awkward and forced silence.

Jonathan Turley is the Shapiro professor of public interest law at George Washington University

The Succinct Economic Case Against the President


21 September, 2012

Obama's Dangerous and Disastrous Presidency

Obama's Dangerous and Disastrous Presidency

By Quin Hillyer on 9.19.12

Name a single thing that has improved under his rule.

How can any cogent American citizen possibly even consider voting for Barack Obama now? That's what lots of conservatives and moderates are asking each other, again and again. It's completely baffling, to those who grew up with any sort of sense of what America means and what the American character traditionally has been, that anybody can look at the man's record and want more of the same.

Almost the entirety of the Muslim world is now rioting against an American president who promised that his olive branches to Muslims would secure peace. Like Jimmy Carter, Obama has only shown a weakness that has emboldened the Islamist haters. Meanwhile, our closest ally in the region, Israel, a stable representative democracy led by an American-educated, America-loving prime minister, has repeatedly been insulted, abandoned, and undermined. In short, the United States is in worse position with all sides in the Middle East/northern Africa. We are embarrassed, feckless, wounded... and in four tragic cases, dead.

Allies in Poland and the Czech Republic have been repeatedly let down and sometimes insulted. The "re-set" with Russia earned us only Russian contempt. China and Russia ignore our entreaties around the world, with absolute disdain for our wishes, our olive branches, or Obama's supposedly Nobel-worthy and messianic genius for diplomacy.

Domestically, our debt has increased by 50 percent in just four years, by some $5 trillion, with not a single observable benefit from the spending. Our bond rating already has been downgraded by one agency, and another major agency threatens to downgrade us. Our unemployment rate has never been beneath 8 percent since Obama's first month in office, even though his economic team said his outrageously expensive "stimulus" package would ensure that it would never rise above 8 percent, and indeed that it would drop below 6 percent within four years.

Our politics is more fractured, less civil, than ever -- and as Bob Woodward, of all people, indicates in his new book, this is largely the fault of Obama. He has been the first president in history to push through a major new program without a single vote from the opposing party -- and while refusing to incorporate a single major idea from the other party, while ignoring overwhelming public sentiment to pass it, and while bending the rules in multiple ways to force it through Congress. Meanwhile, on the real business of Congress, his Senate allies have ignored longstanding law by refusing to pass a budget for three years now, while twice rejecting the president's own pitiful budget proposal by unanimous votes.

Obama campaigned with a promise to rein in abuses of executive power, but instead he increasingly rules by executive decrees of dubious constitutionality. Congress won't pass cap-and-trade, so he orders it anyway. Congress won't pass amnesty for illegal immigrants, so he orders it anyway. Congress won't undermine the work requirement in the welfare system, so he guts the work requirements by executive order. And on and on go the abuses.

His Justice Department is flagrantly corrupt and racialist. It told a black majority town in North Carolina that it could not hold nonpartisan elections because voters would fail to elect the black "candidates of choice" if the candidate weren't identified as Democrats. It intervened against the heroic Fire Department of New York to push racial hiring quotas on the department so outrageous that it would force admittance into the fire academy of candidates who missed as many as 70 percent (!!!) of the questions on a simple entrance exam; and, in blocking all applicants expected to be hired under the previous exam, it prohibited a number of black applicants who actually had met standards from being hired. So outrageous was this abuse that even the leftist Village Voice ran a long feature story taking up for the qualified black applicants whose chances for employment were dashed.

And, of course, DoJ ran an idiotic gun-running program on the Mexican border that led to the deaths of two American agents and countless Mexicans while drawing a rebuke from the Mexican ambassador, and then covered up and even lied about its actions. Also, infamously, it dropped already-won cases against New Black Panther thugs for flagrant voter-intimidation outside a Philadelphia polling place in 2008 -- dropped the cases, indeed, just in time, meaning four days in advance, for one of those thugs again to serve as an official Democratic Party poll-watcher in municipal elections in 2009.

Gasoline prices are twice what they were when Obama took office -- and rising again. The housing market remains in the doldrums. Food stamp use is by far at the highest level in history, and poverty is markedly up. Food prices are markedly higher. Small businesses are jettisoning the health-insurance benefits they offered employees until Obamacare made it prohibitively expensive. Doctors are retiring in record numbers rather than face Obamacare's scourges -- and most of the law hasn't yet taken effect. Coming soon are new taxes on medical device manufacturers: Patients will pay more for wheelchairs, prosthetics, insulin pumps, asthma inhalers, pacemakers, and other essential fruits of modern medical technology.

Taxpayers are on the hook for huge losses from the auto bailouts, even as most of GM's new jobs have been created overseas rather than here, and even as auto dealerships across the nation were shut down by administration fiat on political bases rather than on the basis of which ones were profitable. Taxpayers are on the hook for politically inspired "investments" to Obama cronies in failing businesses such as Solyndra. Taxpayers are on the hook for higher electricity prices due to a backdoor cap-and-trade scheme imposed by (illegal) administrative fiat.

Religious liberties, meanwhile, are under repeated and sustained attacked from an administration openly hostile to traditional faith. And the president even refuses to defend in federal court laws duly passed by Congress and signed by former President Clinton.

The parade of abuses, incompetencies, extravagances, and illegalities goes on and on. The record of improvements in any sector of American life is… well, nil. Nothing is better, not a single thing, at home or abroad. And Obama has offered no recognizable plans, no new proposals, no substance at all, for making things better in a second term.

This presidency is a disaster. Reasonable people are gobsmacked at the possibility that it could somehow be allowed to continue its degradations of American society.

10 August, 2012

The Case Against Reelection

The case against reelection
 By Charles Krauthammer
Published: August 9

There are two ways to run against Barack Obama: stewardship or ideology. You can run against his record or you can run against his ideas.

The stewardship case is pretty straightforward: the worst recovery in U.S. history, 42 consecutive months of 8-plus percent unemployment, declining economic growth — all achieved at a price of an additional $5 trillion of accumulated debt.

The ideological case is also simple. Just play in toto (and therefore in context) Obama’s Roanoke riff telling small-business owners: “You didn’t build that.” Real credit for your success belongs not to you — you think you did well because of your smarts and sweat? he asked mockingly — but to government that built the infrastructure without which you would have nothing.

Play it. Then ask: Is that the governing philosophy you want for this nation?

Mitt Romney’s preferred argument, however, is stewardship. Are you better off today than you were $5 trillion ago? Look at the wreckage around you. This presidency is a failure. I’m a successful businessman. I know how to fix things. Elect me, etc. etc.

Easy peasy, but highly risky. If you run against Obama’s performance in contrast to your own competence, you stake your case on persona. Is that how you want to compete against an opponent who is not just more likable and immeasurably cooler but spending millions to paint you as an unfeeling, out-of-touch, job-killing, private-equity plutocrat?

The ideological case, on the other hand, is not just appealing to a center-right country with twice as many conservatives as liberals, it is also explanatory. It underpins the stewardship argument. Obama’s ideology — and the program that followed — explains the failure of these four years.

What program? Obama laid it out boldly in a series of major addresses during the first months of his presidency. The roots of the nation’s crisis, he declared, were systemic. Fundamental change was required. He had come to deliver it. Hence his signature legislation:

First, the $831 billion stimulus that was going to “reinvest” in America and bring unemployment below 6 percent. We know about the unemployment. And the investment? Obama loves to cite great federal projects such as the Hoover Dam and the interstate highway system. Fine. Name one thing of any note created by Obama’s Niagara of borrowed money. A modernized electric grid? Ports dredged to receive the larger ships soon to traverse a widened Panama Canal? Nothing of the sort. Solyndra, anyone?

Second, radical reform of health care that would reduce its ruinously accelerating cost: “Put simply,” he said, “our health-care problem is our deficit problem” — a financial hemorrhage drowning us in debt.

Except that Obamacare adds to spending. The Congressional Budget Office reports that Obamacare will incur $1.68 trillion of new expenditures in its first decade. To say nothing of the price of the uncertainty introduced by an impossibly complex remaking of one-sixth of the economy — discouraging hiring and expansion as trillions of investable private-sector dollars remain sidelined.

The third part of Obama’s promised transformation was energy. His cap-and-trade federal takeover was rejected by his own Democratic Senate. So the war on fossil fuels has been conducted unilaterally by bureaucratic fiat. Regulations that will kill coal. A no-brainer pipeline (Keystone) rejected lest Canadian oil sands be burned. (China will burn them instead.) A drilling moratorium in the Gulf of Mexico that a federal judge severely criticized as illegal.

That was the program — now so unpopular that Obama barely mentions it. Obamacare got exactly two lines in this year’s State of the Union address. Seen any ads touting the stimulus? The drilling moratorium? Keystone?

Ideas matter. The 2010 election, the most ideological since 1980, saw the voters resoundingly reject a Democratic Party that was relentlessly expanding the power, spending, scope and reach of government.

It’s worse now. Those who have struggled to create a family business, a corner restaurant, a medical practice won’t take kindly to being told that their success is a result of government-built roads and bridges.

In 1988, Michael Dukakis famously said, “This election is not about ideology; it’s about competence.” He lost. If Republicans want to win, Obama’s deeply revealing, teleprompter-free you-didn’t-build-that confession of faith needs to be hung around his neck until Election Day. The third consecutive summer-of-recovery-that-never-came is attributable not just to Obama being in over his head but, even more important, to what’s in his head: a government-centered vision of the economy and society, and the policies that flow from it.

Four years of that and this is what you get.

Make the case and you win the White House.

06 August, 2012

The Real 'Stimulus' Record

By ARTHUR B. LAFFER

Policy makers in Washington and other capitals around the world are debating whether to implement another round of stimulus spending to combat high unemployment and sputtering growth rates. But before they leap, they should take a good hard look at how that worked the first time around.

It worked miserably, as indicated by the table nearby, which shows increases in government spending from 2007 to 2009 and subsequent changes in GDP growth rates. Of the 34 Organization for Economic Cooperation and Development nations, those with the largest spending spurts from 2007 to 2009 saw the least growth in GDP rates before and after the stimulus.

The four nations—Estonia, Ireland, the Slovak Republic and Finland—with the biggest stimulus programs had the steepest declines in growth. The United States was no different, with greater spending (up 7.3%) followed by far lower growth rates (down 8.4%).

Still, the debate rages between those who espouse stimulus spending as a remedy for our weak economy and those who argue it is the cause of our current malaise. The numbers at stake aren't small. Federal government spending as a share of GDP rose to a high of 27.3% in 2009 from 21.4% in late 2007. This increase is virtually all stimulus spending, including add-ons to the agricultural and housing bills in 2007, the $600 per capita tax rebate in 2008, the TARP and Fannie Mae and Freddie Mac bailouts, "cash for clunkers," additional mortgage relief subsidies and, of course, President Obama's $860 billion stimulus plan that promised to deliver unemployment rates below 6% by now. Stimulus spending over the past five years totaled more than $4 trillion.

If you believe, as I do, that the macro economy is the sum total of all of its micro parts, then stimulus spending really doesn't make much sense. In essence, it's when government takes additional resources beyond what it would otherwise take from one group of people (usually the people who produced the resources) and then gives those resources to another group of people (often to non-workers and non-producers).

Often as not, the qualification for receiving stimulus funds is the absence of work or income—such as banks and companies that fail, solar energy companies that can't make it on their own, unemployment benefits and the like. Quite simply, government taxing people more who work and then giving more money to people who don't work is a surefire recipe for less work, less output and more unemployment.

Yet the notion that additional spending is a "stimulus" and less spending is "austerity" is the norm just about everywhere. Without ever thinking where the money comes from, politicians and many economists believe additional government spending adds to aggregate demand. You'd think that single-entry accounting were the God's truth and that, for the government at least, every check written has no offsetting debit.

Well, the truth is that government spending does come with debits. For every additional government dollar spent there is an additional private dollar taken. All the stimulus to the spending recipients is matched on a dollar-for-dollar basis every minute of every day by a depressant placed on the people who pay for these transfers. Or as a student of the dismal science might say, the total income effects of additional government spending always sum to zero.

Meanwhile, what economists call the substitution or price effects of stimulus spending are negative for all parties. In other words, the transfer recipient has found a way to get paid without working, which makes not working more attractive, and the transfer payer gets paid less for working, again lowering incentives to work.

But all of this is just old-timey price theory, the stuff that used to be taught in graduate economics departments. Today, even stimulus spending advocates have their Ph.D. defenders. But there's no arguing with the data in the nearby table, and the fact that greater stimulus spending was followed by lower growth rates. Stimulus advocates have a lot of explaining to do. Their massive spending programs have hurt the economy and left us with huge bills to pay. Not a very nice combination.

Sorry, Keynesians. There was no discernible two or three dollar multiplier effect from every dollar the government spent and borrowed. In reality, every dollar of public-sector spending on stimulus simply wiped out a dollar of private investment and output, resulting in an overall decline in GDP. This is an even more astonishing result because government spending is counted in official GDP numbers. In other words, the spending was more like a valium for lethargic economies than a stimulant.

In many countries, an economic downturn, no matter how it's caused or the degree of change in the rate of growth, will trigger increases in public spending and therefore the appearance of a negative relationship between stimulus spending and economic growth. That is why the table focuses on changes in the rate of GDP growth, which helps isolate the effects of additional spending.

The evidence here is extremely damaging to the case made by Mr. Obama and others that there is economic value to spending more money on infrastructure, education, unemployment insurance, food stamps, windmills and bailouts. Mr. Obama keeps saying that if only Congress would pass his second stimulus plan, unemployment would finally start to fall. That's an expensive leap of faith with no evidence to confirm it.

Generation Squeezed

Generation Squeezed

By Robert Samuelson - August 6, 2012

WASHINGTON -- I worry about the future -- not mine but that of my three children, all in their 20s. It is an axiom of American folklore that every generation should live better than its predecessors. But this is not a constitutional right or even an entitlement, and I am skeptical that today's young will do so. Nor am I alone. A recent USA Today/Gallup poll finds that nearly 60 percent of Americans are also doubters. I meet many parents who fear the future that awaits their children.

The young (and I draw the line at 40 and under) face two threats to their living standards. The first is the adverse effect of the Great Recession on jobs and wages. Even if this fades with time, there's the second threat: the costs of an aging America. It's not just Social Security, Medicare and Medicaid -- huge transfers from the young to the old -- but also deferred maintenance on roads, bridges, water systems and power grids. Newsweek calls the young "generation screwed"; I prefer the milder "generation squeezed."

Already, batteries of indicators depict the Great Recession's damage. In a Pew survey last year, a quarter of 18-to-34-year-olds said they'd moved back with parents to save money. Getting a job has been time-consuming and often futile. In July, the unemployment rate among 18-to-29-year-olds was 12.7 percent. Counting people who dropped out of the labor market raises that to 16.7 percent, says Generation Opportunity, an advocacy group for the young. Among recent high-school graduates, unemployment rates are near half for African-Americans, a third for Hispanics and a quarter for whites, notes the Economic Policy Institute, a liberal think tank.

The weak labor market hurts even job holders. From 2007 to 2011, "real" (inflation-adjusted) wages fell nearly 5 percent for recent college graduates and 10 percent for recent high-school graduates, says EPI. Among college grads, only four in 10 said their jobs required a four-year degree, reports a survey by the John J. Heldrich Center at Rutgers University. If the economy doesn't fully recover, slack labor demand will continue to depress employment and wages for years.

Of course, generalizations can be overdone. Countless millions of young people are doing -- and will do -- fine. History can't be predicted. The mass retirement of baby-boom workers may create job scarcities and raise wages. Still, some setbacks will endure. Some skills that would have been learned on the job won't ever be. Life decisions are deferred. Among 18-to-29-year olds, the weak economy is causing 18 percent to postpone marriage and 23 percent to delay starting a family, reports a survey by Generation Opportunity.

And then there are the costs of aging. Gains in productivity -- from new technologies or better skills -- that would normally flow into paychecks will be siphoned off to pay for retiree benefits, underfunded state and local government pensions and infrastructure repair. Taxes will rise; if not, public services will fall. Or both. Population change can't be repealed. The ratio of workers to retirees, 5-to-1 in 1960 and 3-to-1 in 2010, is projected at nearly 2-to-1 by 2025.

It's often said that today's young will ultimately benefit from this lopsided tax-and-transfer system. Old themselves, they will be similarly subsidized by their young. Doubtful. Sooner or later, the system's oppressive costs will become so obvious that future benefits will be curbed. Chances are the young will still pay for today's elderly without themselves receiving comparable support.

As a parent, all this rattles me. We judge our success by how well our children do. We love them and want them to succeed, even if most of us recognize -- at some point -- that our ability to influence and protect them has expired. Peering into the unfathomable future, we don't like what we think we see. We're dispatching them into a less secure and less prosperous world. These parental anxieties, I think, are the presidential campaign's great, unacknowledged issue. Many voters will decide based on a calculus of which candidate would minimize the economic perils for their grown children.

But the calculus will be selective. To aid the young, we could tighten Social Security and Medicare, raising eligibility ages and reducing payouts for wealthier retirees. Unlikely. Younger voters seem clueless about advancing their economic interests. In 2008, 18-to-29-year-olds supported Barack Obama by 34 percentage points. They love his pseudo-youthfulness. Or his positions on other issues (immigration, gay rights) trump economics. As president, Obama has done nothing to improve generational fairness.

If the young won't help themselves, their parents and grandparents might. They might champion revising retirement programs. Dream on. Parents and grandparents may be worried about their offspring's prospects, but they're not so worried as to sacrifice their own. There are real conflicts between the young and old; so far, the young are losing.

18 July, 2012

Who else, Mr. President?

Who else, Mr. President?

Author: John Kass

When President Barack Obama hauled off and slapped American small-business owners in the mouth the other day, I wanted to dream of my father.

But I didn't have to close my eyes to see my dad. I could do it with my eyes open.

All I had to do was think of the driveway of our home, and my dad's car gone before dawn, that old white Chrysler with a push-button transmission. It always started, but there was a hole in the floor and his feet got wet in the rain. So he patched it with concrete mix and kept on driving it to the little supermarket he ran with my Uncle George.

He'd return home long after dark, physically and mentally exhausted, take a plate of food, talk with us for a few minutes, then flop in that big chair in front of the TV. Even before his cigarette was out, he'd begin to snore.

The next day he'd wake up and do it again. Day after day, decade after decade. Weekdays and weekends, no vacations, no time to see our games, no money for extras, not even forMcDonald's. My dad and Uncle George, and my mom and my late Aunt Mary, killing themselves in their small supermarket on the South Side of Chicago.

There was no federal bailout money for us. No Republican corporate welfare. No Democratic handouts. No bipartisan lobbyists working the angles. No Tony Rezkos. No offshore accounts. No Obama bucks.

Just two immigrant brothers and their families risking everything, balancing on the economic high wire, building a business in America. They sacrificed, paid their bills, counted pennies to pay rent and purchase health care and food and not much else. And for their troubles they were muscled by the politicos, by the city inspectors and the chiselers and the weasels, all those smiling extortionists who held the government hammer over all of our heads.

I thought about this after I heard what Obama told a campaign crowd the other day, speaking about business owners and why they were successful.

"You didn't get there on your own," Obama said. "I'm always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else. Let me tell you something — there are a whole bunch of hardworking people out there.

"If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you've got a business, you didn't build that. Somebody else made that happen. The Internet didn't get invented on its own. Government research created the Internet so that all the companies could make money off the Internet."

If you've got a business, you didn't build that? Somebody else made that happen?

Somebody else, Mr. President? Who, exactly? Government?

One of my earliest memories as a boy at the store was that of the government men coming from City Hall. One was tall and beefy. The other was wiry. They wanted steaks.

We didn't eat red steaks at home or yellow bananas. We took home the brown bananas and the brown steaks because we couldn't sell them. But the government men liked the big, red steaks, the fat rib-eyes two to a shrink-wrapped package. You could put 20 or so in a shopping bag.

"Thanks, Greek," they'd say.

That was government.

We didn't go to movies or out to restaurants. Everything went into the business. Uncle George and dad never bought what they could not afford. The store employed people, and the workers fed their families and educated their children and put them through college. They were good people, all of them. We worked together and worked hard, but none worked harder than the bosses.

It's the same story with so many other businesses in America, immigrants and native-born. The entrepreneurs risk everything, their homes, their children's college funds, their hearts, all for a chance at the dream: independence, and a small business of their own.

Most often, they fail and fall to the ground without a government parachute. But some get up and start again.

When I was grown and gone from home, my parents finally managed to save a little money. After all those years of hard work and denying themselves things, they had enough to buy a place in Florida and a fishing boat in retirement. Dad died only a few years later. You wouldn't call them rich. But Obama might.

Obama's changed. Gone is that young knight drawing the sword from the stone, selling Hopium to the adoring media, preaching an end to the broken politics of the past. These days, he wears a new presidential persona: the multimillionaire with the Chicago clout, playing the class warrior, fighting for that second term.

And he offers an American dream much different from my father's. Open your eyes and you can see it too. He stands there at the front of the mob, in his shirt sleeves, swinging that government hammer, exhorting the crowd to use its votes and take what it wants.

jskass@tribune.com
Twitter @John_Kass

11 July, 2012

Budget Insanity

Budget Insanity

By John Stossel - July 11, 2012

Last year, Congress agreed to $1.2 trillion in automatic spending cuts, unless politicians find other things to cut. They didn't, of course. So now, with so-called sequestration looming in January, panic has set in. Even the new "fiscally responsible" Republicans vote against cutting Energy Department handouts to companies like Solyndra and subsidies to sugar producers. Many claim that any cut in military spending will weaken America and increase unemployment.

It's another demonstration of the politicians' addiction to spending -- and how we are complicit. "One more infrastructure bill" or "this jobs plan" will jumpstart the economy, and then we'll kick our spending addiction once and for all.

But we don't stop.

For most of American history, government was tiny. But since Lyndon Johnson's Great Society and the promise that government would cure poverty, spending has gone up nonstop. This is not sustainable.

Progressives say: If you're so worried about the deficit, raise taxes! But it's a fantasy to imagine that taxing the rich will solve our deficit problem. If the IRS grabbed 100 percent of income over $1 million, the take would be just $616 billion. That's only a third of this year's deficit.

It's the spending, stupid.

Even if you could balance the budget by taxing the rich, it wouldn't be right. Progressives say it's wrong for the rich to be "given" more money. But money earned belongs to those who earn it, not to government. Lower taxes are not a handout.

That's the moral side of the matter. There's a practical side, too. Taxes discourage wealth creation.

Even if you think -- despite all evidence -- that government spends money more usefully than people in the private sector, there is a limit to how much government can tax before people work less or flee.

Progressives claim a small increase in tax rates won't stop the wealthy from producing. But some would stop. When the top marginal rate was 90 percent, actor Ronald Reagan worked just half the year. He said that woke him up to the damage that high taxes impose.

Higher taxes give rich people and politicians more reasons to collude. The rich make contributions, and politicians pay the rich back by giving them tax loopholes.

That's a big loss to America. That money and creative energy spent on figuring out taxes might have gone to build new products, make music, cure cancer or ... who knows what?

Politicians promise to balance the budget by getting rid of what is wasteful, redundant or unnecessary. There's plenty of that, but they have promised to eliminate it for years. They cannot. It's just in the nature of the beast. Centrally planned monopolies do things that are wasteful, redundant and unnecessary.

What will bankrupt us first are the wealth transfers to my generation: Medicare and Social Security

When FDR started Social Security, most people didn't even live to age 65. Today, we average 78 -- and we baby boomers demand all the cool new stuff that modern medicine invents: anti-cholesterol drugs, hip replacements, etc. And we don't want to pay for most of it because we've been trained by government to assume that we're entitled to these things for free, or nearly free. We paid into Social Security and Medicare for our entire working lives, and damn it, we're entitled to get our money back!

Few of us realize that most of us get back up to three times what we paid in, that politicians have promised Social Security and Medicare recipients an impossible $46 trillion more than will exist and that our sense of entitlement will ruin America much faster than foreign aid, subsidies for NPR or foreign wars ever will.

Amazingly, we could grow our way out of debt if Congress simply froze spending at today's levels. That would balance the budget by 2017. If spending growth were limited to just 2 percent per year, the budget would balance by 2020!

But the politicians won't do even that.

It's depressing writing this. But it's not hopeless. There are examples of fiscal sanity we can follow -- if we have the will.

31 May, 2012

So basically the argument is that soft drinks are empty calories that provide no nutritional value. 


Two Responses:
1) Please stop telling me what to consume, especially related to food.  I am an adult and am capable of making my own choices, weighing benefits and costs.  Often, supporters argue that "bad" consumption choices affect everyone because the government ends up picking up the tab for health care needs that result from that consumption.  But that is a government created problem resulting from government subsidization of  healthcare.  Stop paying for healthcare, and we remove this issue.  So, in order to protect freedom of choice, we must decide as a society to either A) stop providing subsidized healthcare or B) accept that costs will be high as we provide subsidized healthcare.  Limiting freedom of choice in the name of subsidized healthcare should not be an option.  


2)  You know what else has empty calories that provide no nutritional value (while leading to even more negative impacts on society)?  Alcohol.  Interestingly, no mention of limiting alcohol consumption exists in the article.  Could that be because NY City makes a lot of money off taxes and licensing related to alcohol?  Until Alcohol is part of this "empty" calorie conversation, I will not view this as a genuine effort to improve health but rather an effort to expand the "nanny state".

New York City seeks to ban big sodas from restaurants, food carts - CNN.com
By Ronni Berke and Josh Levs , CNN
updated 11:43 AM EDT, Thu May 31, 2012 CNN.com

New York (CNN) -- New York City is set to ban the sale of large-size sodas and other sugary beverages in an effort to combat rising obesity rates, city officials said Thursday.

The ban would outlaw the sale of such drinks larger than 16 ounces at restaurants, food carts and any other establishment that receives a letter grade for food service. It would not apply to grocery stores

The New York City Department of Health will submit the measure to the Board of Health on June 12. There will then be a three-month comment period before the board votes on the proposal, according to a document city officials provided to CNN.

"The Health Department will then provide restaurants six months from the time the Board of Health adopts the proposal before citing violations, and nine months before issuing fines," the document says.

The department's commissioner, Dr. Tom Farley, tweeted that big sugary drinks are a "major contributor" to the "obesity epidemic. We're proposing to cap them at 16 oz in restaurants."

"There they go again," Stefan Friedman, a spokesman for the New York City Beverage Association, said in a statement. "The New York City Health Department's unhealthy obsession with attacking soft drinks is again pushing them over the top. The city is not going to address the obesity issue by attacking soda because soda is not driving the obesity rates."

Center for Science in the Public Interest spokesman Jeff Cronin told CNN that his group considers the decision the "boldest move in the country" and "not the first time that Mayor (Michael) Bloomberg has led the charge."

"In the same way New York City generated momentum for calorie labeling and for getting rid of artificial trans fat, we hope this move today will start a national movement to ratchet down out of control soda serving sizes," Cronin said.

McDonald's restaurants issued a statement saying, "Public health issues cannot be effectively addressed through a narrowly focused and misguided ban. This is a complex topic, and one that requires a more collaborative and comprehensive approach."

A statement from the Coca-Cola company said the "people of New York City are much smarter than the New York City Health Department believes. ... New Yorkers expect and deserve better than this. They can make their own choices about the beverages they purchase. We hope New Yorkers loudly voice their disapproval about this arbitrary mandate."

Broad public health initiatives have become a hallmark of Bloomberg's administration. Under the mayor, the city has banned trans fats from restaurants, smoking from parks, and has placed graphic ads targeting junk food and tobacco in public transit.

The Centers for Disease Control and Prevention says that "many people don't realize just how many calories beverages can contribute to their daily intake."

The CDC's National Center for Health Statistics, in a brief last August, said sugar drinks "have been linked to poor diet quality, weight gain, obesity, and, in adults, type 2 diabetes."

The American Heart Association has recommended a consumption goal of no more than 450 kilocalories of sugar-sweetened beverages -- fewer than three 12-ounce cans of carbonated cola -- per week, the report says.

But Friedman, in his statement, said that "as obesity continues to rise, CDC data shows that calories from sugar-sweetened beverages are a small and declining part of the American diet."

Beverage Digest, which tracks sales, reported that in 2011, sales of carbonated soft drinks dropped by 1%, a steeper decline than the year before. Total sales of carbonated soft drinks are down to the level they were in 1996, the report said.

Per capita consumption is at its lowest since 1987, the report said.

But the CDC notes that the consumption of sugar drinks -- including non-carbonated beverages -- is higher than it was 30 years ago. And part of the key to cutting calories is "to think about what you drink," it says.

That includes watching calories in coffee drinks and smoothies, the CDC says. Just over half -- 52% -- of calories from sugar drinks are consumed at home, the CDC brief said.

CNN's Ronni Berke reported from New York; CNN's Josh Levs reported from Atlanta.

30 May, 2012

Nancy Pelosi's USA Today Editorial


Note that middle class tax cuts, "strengthen the economy by putting money into the pockets of consumers and supporting small businesses, the engines of our recovery and job creation", but tax cuts for the wealthy "increase the deficit and do not grow the economy or create jobs".  

Also notice the complete lack of support for this inconsistency.

Additionally, there are ~1 Million US households who make more than $1 Million in yearly income.  If we confiscate an additional $100K from each, that would bring in $100 Billion in revenue.  While this is not an insignificant amount of money, is does little to close the $1.3 Trillion budget deficit from last year alone.  Even if we move forward with tax increases, increasing revenue from the risk is not going to be enough - overall spending must decrease.


By House Minority Leader Nancy Pelosi

America's middle class — families, workers and small businesses — deserves economic stability and certainty. That is why Democrats have called on House Speaker John Boehner, R-Ohio, to set an immediate vote on extension of the middle-income tax cuts. Our economic growth requires that we act now.

Our nation's entrepreneurial spirit depends on a thriving middle class. These tax cuts strengthen the economy by putting money into the pockets of consumers and supporting small businesses, the engines of our recovery and job creation.

We face two tasks: One is to promote growth and create jobs; the other to reduce the deficit. Our proposal achieves both goals.

If Democrats and Republicans agree that we should not raise taxes on the middle class, then the question Republicans must answer is: Will they support middle-class tax relief now, or will they continue to insist that it be coupled with tax breaks for the wealthy that increase the deficit and do not grow the economy or create jobs?
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Democrats have always opposed the Bush tax cuts for the wealthiest Americans. Since President Obama's election, we have repeatedly called for an end to tax cuts for those making more than $250,000 a year. Republicans have rejected this effort, holding tax relief for the middle class and small businesses hostage to permanent tax breaks for millionaires, Big Oil, and corporations that ship jobs overseas.

Democrats are committed to moving the process forward by asking the wealthiest to pay their fair share through the expiration of tax cuts for those earning over $1 million a year. Democrats are committed to using the significant savings to reduce the deficit. And in the future, Democrats are committed to reforming the tax code, closing special interest loopholes.

Democrats and President Obama have supported a grand bargain to spur our economy and reduce our deficit in a balanced way. We hope Republicans return to negotiations after walking away. Until then, we must not allow the middle class and small businesses to pay the price. We must invest in jobs and growth, as we reduce the deficit and restore certainty for Americans.

Rep. Nancy Pelosi, D-Calif., the first female speaker of the House, serves as minority leader.

23 May, 2012

Too much agreement means more entitlements

Why is the cost of college increasing so quickly?  


In part, I believe it is because the government continues to provide cheap loan terms to students.  If loans were more expensive, demand for high-priced colleges would go down, and these institutions would have to reduce their prices (or at least slow the rate of tuition increases).  


Additionally, it is not clear to me why the federal government needs to provide loans - private companies would be willing to make these loans if they believe they are likely to be repaid.  If they are unlikely to be repaid, why should the tax payers be left taking the loss on these "bad bets"?  I suppose one could argue that the benefit to society associated with disadvantaged students achieving upward mobility outweighs the financial loss of education debts that go unpaid.  This is unpersuasive - if the upward mobility occurs, it would allow for the repayment of education debt.  If students are regularly unable to pay, this would indicate that this upward mobility is not occurring.

Too much agreement means more entitlements
By George F. Will, Published: May 16

Bipartisanship, the supposed scarcity of which so distresses the high-minded, actually is disastrously prevalent.

Since 2001, it has produced No Child Left Behind, a counterproductive federal intrusion in primary and secondary education; the McCain-Feingold speech rationing law (the Bipartisan Campaign Reform Act); an unfunded prescription drug entitlement; troublemaking by Fannie Mae and Freddie Mac; government-directed capitalism from the Export-Import Bank; crony capitalism from energy subsidies; unseemly agriculture and transportation bills; continuous bailouts of an unreformed Postal Service; housing subsidies; subsidies for state and local governments; and many other bipartisan deeds, including most appropriations bills.

Now, with Europe’s turmoil dramatizing the decadence of entitlement cultures and with American governments — federal, state and local — buckling beneath unsustainable entitlements, Congress is absent-mindedly creating a new entitlement for the already privileged. Concerning the “problem” of certain federal student loans, the two parties pretend to be at daggers drawn, skirmishing about how to “pay for” the “solution.” But a bipartisan consensus is congealing: Certain student borrowers — and eventually all student borrowers, because, well, why not? — should be entitled to loans at a subsidized 3.4 percent interest rate forever.

In 2006, Democrats, trying to capture control of Congress by pandering to students and their parents, proposed cutting in half the statutory 6.8 percent rate on some federal student loans. Holding Congress in 2007, and with no discernible resistance from the compassionately conservative George W. Bush administration, Democrats disguised the full-decade cost of this — $60 billion — by pretending that the subsidy, which now costs $6 billion a year, would expire in five years.

The five years are up July 1, and of course the 3.4 percent rate will be extended. Barack Obama supports this. So does Mitt Romney, while campaigning against a “government-centered society.” What would we do without bipartisanship?

The low 6.8 percent rate — private loans for students cost about 12 percent — was itself the result of a federal subsidy. And students have no collateral that can be repossessed in case they default, which 23 percent of those receiving the loans in question do. The maximum loan for third- and fourth-year students is $5,500 a year. The payment difference between 3.4 percent and 6.8 percent is less than $10 a month, so the “problem” involves less than 30 cents a day.

The 3.4 percent rate applies to only one category of federal loans, but because the Obama administration has essentially socialized the student loan business, federal loans are 90 percent of student borrowing, and this “temporary” rate probably will eventually be made permanent for all federal student loans.

Unsurprisingly, Obama has used this loan issue as an occasion to talk about himself, remembering the “mountain of debt” he and Michelle had when, armed with four Ivy League degrees (he from Columbia, she from Princeton, both from Harvard Law), they graduated into the American elite. The Atlantic’s Conor Friedersdorf notes that if Washington is feeling flush enough to spend another $60 billion on education in a decade, it could find more deserving people to subsidize than a privileged minority of college students who are acquiring credentials strongly correlated with higher-than-average future earnings.

The average annual income of high school graduates with no college is $41,288; for college graduates with just a bachelor’s degree it is $71,552. So the one-year difference ($30,264) is more than the average total indebtedness of the two-thirds of students who borrow ($25,250).

Taxpayers, most of whom are not college graduates (the unemployment rate for high school graduates with no college education: 7.9 percent), will pay $6 billion a year to make it slightly easier for some fortunate students to acquire college degrees (the unemployment rate for college graduates: 4 percent).

Between now and July, the two parties will pretend that it is a matter of high principle how the government should pretend to “pay for” the $6 billion while borrowing $1 trillion this year. But bipartisanship will have been served by putting another entitlement on a path to immortality.

Campaigning recently at Bradley University in Peoria, Ill., Romney warned students about their burden from the national debt, but when he took questions, the first questioner had something else on her peculiar mind: “So you’re all for like, ‘Yay, freedom,’ and all this stuff and ‘Yay, like, pursuit of happiness.’ You know what would make me happy? Free birth control.”

While awaiting that eventual entitlement, perhaps she can land a subsidized loan so she can inexpensively continue to hone her interesting intellect.

04 May, 2012

Divider in Chief

By CHARLES KRAUTHAMMER

 "The pundits like to slice and dice our country into red states and blue states ..." – Barack Obama, rising star, Democratic convention, 2004

Poor Solicitor General Donald Verrilli. Once again he's been pilloried for fumbling a historic Supreme Court case. First shredded for his "train wreck" defense of Obamacare's individual mandate, he is now blamed for the defenestration in oral argument of Obama's challenge to the Arizona immigration law.

The law allows police to check the immigration status of someone stopped for other reasons. Verrilli claimed that constitutes an intrusion on the federal monopoly on immigration enforcement. He was pummeled. Why shouldn't a state help the federal government enforce the law? "You can see it's not selling very well," said Justice Sonia Sotomayor.

But Verrilli never had a chance. This was never a serious legal challenge in the first place. It was confected (and timed) purely for political effect, to highlight immigration as a campaign issue with which to portray Republicans as anti-Hispanic.

Hispanics are just the beginning, however. The entire Obama campaign is a slice and dice operation, pandering to one group after another, particularly those that elected Obama in 2008 – blacks, Hispanics, women, young people – and for whom the thrill is now gone.

What to do? Try fear. Create division, stir resentment, by whatever means necessary – bogus court challenges, dead-end Senate bills and a forest of straw men.

Why else would the Justice Department challenge the photo ID law in Texas? To charge Republicans with seeking to disenfranchise Hispanics and blacks, of course. But in 2008 the Supreme Court upheld a similar law from Indiana. And it wasn't close: 6-3, the majority including that venerated liberal, John Paul Stevens.

Moreover, photo IDs were recommended by the 2005 Commission on Federal Election Reform, co-chaired by Jimmy Carter. And you surely can't get into the attorney general's building without one. Are Stevens, Carter and Eric Holder anti-Hispanic and anti-black?

The ethnic bases covered, we proceed to the "war on women." It sprang to public notice when a 30-year-old student at an elite law school (starting private-sector salary upon graduation: $160,000) was denied the inalienable right to have the rest of the citizenry (as co-insured and/or taxpayers – median household income: $52,000) pay for her contraception.

Despite a temporary setback – Hilary Rosen's hastily surrendered war on moms – Senate Majority Leader Harry Reid will resume the battle with a Paycheck Fairness Act that practically encourages frivolous lawsuits and has zero chance of passage.

No matter. Its sole purpose is to keep the war-on-women theme going, while the equally just-for-show Buffett Rule, nicely pitting the 99 percent versus the 1 percent, is a clever bit of class warfare designed to let Democrats play tribune of the middle class.

Ethnicity, race, gender, class. One more box to check: the young. Just four years ago, they swooned in the aisles for Obama. No longer. Not when 54 percent of college graduates under 25 are unemployed or underemployed.

How to shake them from their lethargy? Fear again. Tell them, as Obama repeatedly does, that Paul Ryan's budget would cut Pell Grants by $1,000 each, if his domestic cuts were evenly distributed. (They are not evenly distributed, making the charge a fabrication. But a great applause line.)

Then warn that Republicans would double the interest rate on student loans. Well, first, Mitt Romney has said he would keep them right where they are. Second, as The Washington Post points out, this is nothing but a recycled campaign gimmick from 2006 when Democrats advocated (and later passed) a 50 percent rate cut that gratuitously squanders student aid by subsidizing the wealthy as well as the needy.

For Obama, what's not to like? More beneficiaries, more votes.

What else to run on with 1.7 percent GDP growth (2011), record long-term joblessness and record 8 percent-plus unemployment (38 consecutive months, as of this writing). Slice and dice, group against group.

There is a problem, however. It makes a mockery of Obama's pose as the great transcender, uniter, healer of divisions. This is the man who sprang from nowhere with that thrilling 2004 convention speech declaring that there is "not a black America and white America and Latino America and Asian America; there's the United States of America."

That was then. Today, we are just sects with quarrels – to be exploited for political advantage. And Obama is just the man to fulfill Al Gore's famous mistranslation of our national motto: Out of one, many.