Category Archives: Politics

Failures of Governance

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I don’t have time for a full post today… but here’s some short quotes for further reading:

Turns out that Liberal welfare programs are so fiscally disastrous, paying for them would require the indefinite imposition of 80% income taxes:

The total present value of payments expected under Social Security and Medicare beyond what is expected to be collected under current tax laws is about $100 trillion. One way to put that amount of money in context is to note that it is about twice the amount of all the net private assets that exist in America today.

To answer cw’s question directly, the best back-of-envelope estimate is that meeting this unfunded portion of our Social Security and Medicare commitments would require roughly an immediate 80 percent increase in federal income taxes, sustained forever.

And yet Obama criticizes anyone trying to bring this disaster under control as unwilling to engage in an “adult” conversation.  Something tells me our economy will be even worse when 80% of the wealth produced by the economy is confiscated by third parties.  Why work?

In other news, Obama has borrowed as much in one month as Bush did during all of 2007.

In other news, The value of the dollar plunged to a 2 1/2 year low… causing investors to flee to commodities such as gold and crude… putting further upward pressure on Gasoline prices… and making everything, from corn to cotton, more expensive for consumers.  Think of this as a tax on the poor.

Standard & Poor’s just slashed the United State’s debt rating to negative from stable.  Probably all the Republican debt from the Bush era causing that reaction.  Anyway, Market Watch says the likely outcome is that:

A downgrade would push up interest rates on Treasurys, which are a benchmark for other consumer and business borrowing rates, raising the cost of credit throughout the economy.

Think of this as yet another tax on the poor and middle class… who rely most on credit.

Meanwhile, it is looking ever more likely that Gas will hit not only $4 a gallon, but $5 a gallon… which is caused by a severe loss of Dollar value as well as a constrained supply of oil… thank GOD we’ve opened the Gulf back up for drilling… O, wait, Obama hasn’t done that yet?  Oh… my bad.

And finally, it turns out Obama is arming Al Qaeda in Lybia.  I didn’t think it was possible either… but here we are.

The state of the economy… more than 2 years later

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Lets engage in a thought experiment.  Imagine that there are no such thing as term limits and that Bush actually won the election of 2009.  Fortunately, that’s the hard part of the thought experiment.  Now imagine that everything else remained exactly the same. The same health care bill, the same bailouts, the same massive debt, the same repeated statements about ‘focusing like a laser‘ on the economy followed by more than two years of a 10% unemployment rate, the same “kinetic military action” in Lybia, the same lavish trips to Spain, Rio, The Hamptons, the same 60 rounds of golf, the same ‘transparency‘.  Imagine if everything else that has happened had not changed one bit.

Now ask yourself this question:  can you imagine a media being as forgiving to Bush as they have been to Obama the past 27 months? Can you imagine the media giving Bush a pass on Abu Gharab #2?  Can you imagine them passing on the opportunity to paint the Lybian action as yet another wasteful failure of American power in the Middle East?  Can you imagine their condesention at Bush’s attempt to ‘brand’ the Lybian action as this rather Orwellian-sounding “kinetic military action“?  Can you imagine Bush being given a pass with unemployment still hovering around 10% over 27 months after he passed a trillion dollars in stimulus?  Can you imagine, given their reaction to how much the Iraq war cost, what their reaction would be to the biggest federal debt and deficits in history?  Can you imagine?

If you’ve got a decent imagination, very quickly you would see that there is an incredible double-standard at work, not only in the mainstream media, but in what Liberals find objectionable on any given day.  And what concerns me the most is their utter lack of interest in the economic hardships the American people are facing… and the lack of interest Obama has in doing anything to fix this problem more than a year after it became apparent that his original plans to simulate had failed.

I don’t know about you, but when I read headlines like “Gallup Finds U.S. Unemployment Rate at 10.0% in March“… I swallow rather hard… because it is quite apparent that we are still in the midst of an economic cricis.  And make no mistake, 2 years of stagnant growth and 10 percent unemployement is a cricis… regardless of how many times the mainstream media tells you were ‘in a recovery’.  If you look at the details, its shocking how bad a position we are in.  Even the unemployment figures don’t tell the whole story:

The percentage of the overall population that is employed in March 2010 was 58.6 percent. One year later, the total percentage of overall population  employed is… 58.5 percent.  Conclusion: In a growing population we have produced fewer jobs than the number that the population grew. (For the record, the number of Civilian non-institutionalized population was 237.2 million in March 2010, and is 239.00 million in March 2011.)

The number of people who were “not in the labor force” In March 2010 was 83,264,000 (seasonally adjusted). In March 2011, it was 85,594,000 (seasonally adjusted). If you want to know how unemployment dropped a point, look no further than this statistic.

Bottom line… overall REAL unemployment hasn’t changed one bit… regardless of what statistics the Office of Labor releases.  The only thing that has been keeping the unemployement figures as low as they have been… has been due to some rather arbitrary accounting — magically rounding the overall workforce number down to make the same number of unemployed seem like a lower percentage.

Furthermore, we find ourselves in this position even after spending trillions of dollars of debt-spending on ‘stimulus’.  I don’t know about you, but for a trillion dollars… I expected the streets to be paved with gold…. not barely paved.

What has become clear to me is that Obama has no clue what causes economic growth… and has doubled down on  a failed Keynesian ideology despite the overwhelming evidence of its ineffectiveness.

And to make matters worse, as the recent ballooning budget crisis hit state governments, we have slowly begun to realize that all that money that was promised to simulate ‘main street’ mom-and-pop stores… actually was spent protecting union members and federal workers from the pain of economic downturn.  Look at the breakdown on the Business Insider website:

  • $36.9 billion for Aid to People Affected by Economic Downturn (YAY!)
  • $48.4 billion for Education (Think teachers unions)
  • $324 million for Accountability (Think federal employees)
  • $58.4 billion for Aid to State and Local Governments (Think public sector state unions)
  • $41.4 billion for Energy
  • $13.1 billion for Science and Technology including $2.5 billion to National Science Foundation research and $4.7 billion to National Telecommunications and Information Administration… 400 million to NASA (think federal employees)
  • $18.8 billion for Health Care (almost half of which went to federal agencies)
  • $870 million for Business ($646 of which went to Small business loans)
  • $98.3 billion for Transportation and Infrastructure (think Union jobs)
  • $48.3 billion for Infrastructure (Jobs for Main Street Act, the purpose of which was “To poach previously allocated TARP funding and funnel the money into creating jobs in targeted sectors of the US economy [including] mass transit, schools, public housing, and clean water initiatives while adding jobs in these fields.
  • $26.7 billion for Public Service Jobs (ironically titled “Jobs for Main Street Act”)
  • $79 billion for Emergency Relief for Families (good, but hardly ‘stimulus’)
  • $34 billion for the Extension of Unemployment Benefits

Just look at the mysterious lack of anything beneficial for the 80% of the country that is a) not unionized or b) not a federal worker!  Oh, and any ‘stimulus’ that DID go to the the non-unionized private sector was in the form of government LOANS… all of which are to be paid back… basically creating a wash in dollar terms.

I mean seriously, did anyone really expect any of this to work??!!  Can we all agree that whatever this was… it was NOTHING a true stimulus should have been?!  What DID go to the private sector in ‘free’ money was only to help people WITHOUT jobs manage… not help the businesses they work at CREATE NEW ONES. To all my friends on the left: do you not see the sad reality here… the lack of any real solution for most of the middle class in this country… despite Obama’s “laser-like-focus” on jobs!!!??? Doesn’t anyone notice this?  I feel like I’m taking crazy pills!

And then I read this article by Stephen Moore explaining that its worse:

Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million).

It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

And while some of this discrepancy has happened because of real productivity gains in manufacturing…  the government sector has grown by multiples… and has shown decreasing productivity:

Over the period 1970-2005, school spending per pupil, adjusted for inflation, doubled, while standardized achievement test scores were flat. Over roughly that same time period, public-school employment doubled per student, according to a study by researchers at the University of Washington. That is what economists call negative productivity.

We are spending twice as much on education… and getting worse results.   GREAT.

This is a real disaster we are experiencing…  lets hope the next president can fix things before its too late.

Wisconsin & Unions

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As many of you who follow the news are probably aware, Scott Walker recently won a victory of sorts against the unions in Wisconsin.  I’ve hesitated to give running commentary during the negotiations themselves, as whatever I wrote would undoubtedly be immediately outdated… but now that we have a result in that ideological battle, I think some commentary is justified.

Courtesy of: http://www.flickr.com/photos/thehardestpart/5460477085/What has been interesting to me is that, even for many liberals I talked with, the real issue with many on the left was not necessarily that teachers were being asked to contribute to their pensions… but that the unbelievably important right to engage in collective bargaining was being taken away.  I emphasize “unbelievably important” because of all the things to protest, I’m still wrapping my head around why this right was so important to many on the left.

Now, I should point out that, contrary to the running narrative in the mainstream media, the bill that passed the Wisconsin legislature did not completely remove the right to collective bargaining.  There will still be unions… and many of the various protections and benefits incurred by union membership (including the right to collectively bargain for wages) will continue after the bill’s passage.  The only significant downside for unions seems to be the inability to collectively bargain for health care and pension benefits.

Now, what I find interesting here is that these same union protestors (many of whom lean democrat) who completely support Obama’s rather unilateral intervention into the health care market — those who cheered the notion of the federal government arbitrarily changing all the rules of the health care system… limiting what kinds of plans we can have and punishing people with fines (even jail time)… now all of a sudden are getting really up-tight when the rules all of a sudden change on them.

Even so, to focus on the minutia of this particular loss of union bargaining power is problematic because at its core, I think the underlying issues go much deeper.  What is driving the protests is the fear of a loss of political power, and not just any political power, but a loss of power over the people of Wisconsin.  After all, these unions are not fighting some evil corporation undermining their livelihood, they are bargaining against the very taxpayers they claim to serving.  For decades, this ‘bargaining’ was not really bargaining at all, but was instead a series of political pay-offs by Democrat politicians to the unions who had generously funded their campaign efforts through union dues.  While I think Peter Robinson summed up the problem best on the Ricochet Podcast when he said:

“In effect, it [permitting collective bargaining rights for public employees] makes no sense for an economic point of few [or] from a bargaining point of view. Its not bargaining; they sit on both sides of the table. The union sits on one side… the officials they help to get elected sits on the other side of the table…. the officials vote the unions more money… the unions have the states collect their dues which then go into enormous funds which they spend getting more of their officials elected. It is an outrage and a sham. “

Whatever bargaining was going on… It had not been ‘bargaining’ in the classic sense of the term.  For too long, union interests dominated Wisconsin politics and were at least partially responsible for a crushing budget deficit.  Public unions had been waging political war against the Wisconsin republican establishment for decades by bank-rolling Democrat candidates… and the people of Wisconsin, by electing Scott Walker, have finally gotten tired of this broken bargaining system… and wanted their interests to be represented… for a change.  I don’t think the analysis of the Wisconsin situation is really much more complicated than that.

I am not arguing here that unions do not deserve to be able to bargain collectively, or that all unions deserve this sort of criticism… but I think that the will of the people of Wisconsin should be heard in this case.  Regardless of which side of this debate is really in the ‘right’… I think the most important principle from which every state should begin when addressing these issues is this:  The public does not exist to serve the interests of its public employees… but rather public employees exist at the will of the people who pay their salaries. The tension in wisconsin at its heart, is between those who agree with this principle and those who do not.

What I’m reading…

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A great piece by the editors over at National Review:

Government does not make investments. History suggests that it is not especially successful when it tries to do so, and the Obama administration has been a singularly ineffective manager of our national finances, its incompetence rivaled in modern times only by that of the Johnson administration. “Investing in America” is simply rhetorical camouflage deployed to avoid answering the simple questions: “Is this proposed spending wise? Is it the best and most prudent use of our money? Is it undertaken in accordance with our constitutional order and the proper role of government?” President Obama would prefer not to debate those questions, instead asking us to judge present outlays against future returns that may or may not live up to his promises.

Consider our recent national “investment” in education, which has seen spending more than double since 2000 with no discernable returns to anybody other than the public-sector unions: high costs, zero profit. In reality, the defining feature of government “investment” is that there is no discernable relationship between outlays and returns. And calling new spending programs “investments” — as Obama did about 15 times in his stimulus pitch and about two dozen times during his 2010 speech at Carnegie Mellon University — does not make them wise or profitable.

What I’m reading…

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1.  The Complete List of Obama Statement Expiration Dates – By Jim Geraghty [Or, as I would put it: "The complete list of the lies Obama told the American people during his campaign."]

STATEMENT: “We’ve got a philosophical difference, which we’ve debated repeatedly, and that is that Senator Clinton believes the only way to achieve universal health care is to force everybody to purchase it. And my belief is, the reason that people don’t have it is not because they don’t want it but because they can’t afford it.” Barack Obama, speaking at a Democratic presidential debate, February 21, 2008.

EXPIRATION DATE: On March 23, 2010, Obama signed the individual mandate into law.

HEALTH-CARE NEGOTIATIONS ON C-SPAN

STATEMENT: “These negotiations will be on C-SPAN, and so the public will be part of the conversation and will see the decisions that are being made.” January 20, 2008, and seven other times.

EXPIRATION DATE: Throughout the summer, fall, and winter of 2009 and 2010; when John McCain asked about it during the health-care summit February 26, Obama dismissed the issue by declaring, “the campaign is over, John.”

RAISING TAXES

STATEMENT: “No family making less than $250,000 will see any form of tax increase.” (multiple times on the campaign trail)

EXPIRATION DATE: Broken multiple times, including the raised taxes on tobacco, a new tax on indoor tanning salons, but most prominently on February 11, 2010: “President Barack Obama said he is ‘agnostic’ about raising taxes on households making less than $250,000 as part of a broad effort to rein in the budget deficit.”

RECESS APPOINTMENTS

STATEMENT: Then-senator Obama declared that a recess appointment is “damaged goods” and has “less credibility” than a normal appointment. August 25, 2005.

EXPIRATION DATE: March 27, 2010: “If, in the interest of scoring political points, Republicans in the Senate refuse to exercise that responsibility, I must act in the interest of the American people and exercise my authority to fill these positions on an interim basis.”

It goes on for another 10 pages like this…

Reading on Welfare…

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Sobering Statistics… The more we spend on welfare… the more poverty we seem to get.

After all we’ve been throwing money at poverty ever since Lyndon Johnson first declared war on poverty in 1965 — more than $13 trillion so far, with state and local governments laying out another couple of trillion. This year alone, federal welfare spending will exceed $600 billion, to fund 122 separate anti-poverty programs. During his first two years in office, President Obama has already hiked welfare spending by more than $120 billion. And that comes on top of an $80 billion increase under President Bush.

via On Welfare, an Unlikely Voice of Reason – Michael Tanner – National Review Online.

Redeemer vs Leader

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Sigh… I had so much commentary written about this article but it was all lost with a botched form submission.  At any rate: here is a very compelling “profile” of the modern Liberal; I’d be interested to hear how accurate everyone thinks it is:

Among today’s liberal elite, bad faith in America is a sophistication, a kind of hipness. More importantly, it is the perfect formula for political and governmental power. It rationalizes power in the name of intervening against evil—I will use the government to intervene against the evil tendencies of American life (economic inequality, structural racism and sexism, corporate greed, neglect of the environment and so on), so I need your vote.

“Hope and Change” positioned Mr. Obama as a conduit between an old America worn down by its evil inclinations and a new America redeemed of those inclinations. There was no vision of the future in “Hope and Change.” It is an expression of bad faith in America, but its great ingenuity was to turn that bad faith into political motivation, into votes.

But there is a limit to bad faith as power, and Mr. Obama and the Democratic Party may have now reached that limit. The great weakness of bad faith is that it disallows American exceptionalism as a rationale for power. It puts Mr. Obama and the Democrats in the position of forever redeeming a fallen nation, rather than leading a great nation. They bet on America’s characterological evil and not on her sense of fairness, generosity or ingenuity.

When bad faith is your framework (Michelle Obama never being proud of her country until it supported her husband), then you become more a national scold than a real leader. You lead out of a feeling that your opposition is really only the latest incarnation of that old characterological evil that you always knew was there. Thus the tea party—despite all the evidence to the contrary—is seen as racist and bigoted.

But isn’t the tea party, on some level, a reaction to a president who seems not to fully trust the fundamental decency of the American people? Doesn’t the tea party fill a void left open by Mr. Obama’s ethos of bad faith? Aren’t tea partiers, and their many fellow travelers, simply saying that American exceptionalism isn’t racism? And if the mainstream media see tea partiers as bumpkins and racists, isn’t this just more bad faith—characterizing people as ignorant or evil so as to dismiss them?

via Shelby Steele: A Referendum on the Redeemer – WSJ.com.

speaking of economic injustice

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The private sector has been hit particularly hard during this recession… and things don’t look like they will be getting much better any time soon.  As the pool of unemployed grows… and the more desperate they become… the more salaries for new workers will also decline. Obama keeps talking about “shared responsibility” and the “sacrifices” we need to be willing to make for the next generation… and he may be right; perhaps we do need to make sacrafices to ensure the next generation is better off than we are.  But amidst all these calls for those of us in the private sector  to “sacrafice”… one segment of our society that isn’t doing much in the way of sacrifice are those with government connections… the “ruling class” as Angela Codivella so aptly put it. Here is the latest from USA Today:

At a time when workers’ pay and benefits have stagnated, federal employees’ average compensation has grown to more than double what private sector workers earn, a USA TODAY analysis finds…

Federal civil servants earned average pay and benefits of $123,049 in 2009 while private workers made $61,051 in total compensation, according to the Bureau of Economic Analysis. The data are the latest available.

The federal compensation advantage has grown from $30,415 in 2000 to $61,998 last year.

Twice the average compensation. Shocking, isn’t it?  And what makes matters worse is that the public sector… which has been hurting like never before… is subsidizing the extravagance of public sector employees.  It is one thing if someone EARNS more in the private sector because he or she creates greater value or sells a product someone else wants to buy… thereby gaining wealth by the voluntary exchange of goods and services.   It is quite another thing when an employee of the state — who produces nothing more of value than their private sector counterparts — earn far more simply by virtue of their connections to political power and influence.

Perhaps it is best said another way:  Government profits far more of the backs of the private sector than the private sector profits by means of the free market.  The very liberals who lament “greedy” and “evil” corporations don’t even bat an eye when the political class profits by a 2-to-1 factor off the working class.  If your worldview revolves around the idea that government is intrinsically good… than I suppose one wouldn’t find this to be some great injustice… but for the rest of us… those of us who see the waste, the inefficiencies, and the incompetence systematic of government activity… than this is truly an outrage.

via Federal workers earning double their private counterparts – USATODAY.com.