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Showing posts with label Economics. Show all posts
Showing posts with label Economics. Show all posts
Wednesday, September 12, 2012
Why Capitalism Has A Bad Reputation
Click Here To Read Article/Comments at CommentaramaPolitics
Tuesday, August 7, 2012
Obama Was Sabotaged!!
Forget that Obama has saddled the economy with trillions in new taxes and regulations. Forget that he wants to shove Obamacare on the nation’s employers and terrorize the medical community. Forget that he’s adding more to the debt than all other presidents combined. Forget that he’s allowed too big to fail to get even bigger, that he’s done nothing to stabilize the housing market, and that inflation is out of control. Yeah, forget all that. The real reason the economy sucks is because. . .
(1) Corporate America is “sitting on vast piles of cash.” Yep. Although conditions are clearly right for Corporate America to be out there starting new businesses, launching new products, hiring like crazy, and making America the economic powerhouse it was meant to be, this cabal of Romney supporters simply refuse to do any of that.
Politico notes that according to the Fed, private companies are sitting on $2 trillion in cash. Reuters puts the number closer to $5 trillion. So why aren’t they spending that money on hiring people? Well, apparently, these evil business types site uncertainly, which Politico defines as there being “no guarantee there will be enough consumer demand to buy the product because not enough jobs are being created to put more money in people’s wallets.” Politico calls this a real “chicken and egg problem.”
Now think about this. What Politico is saying is that it is impossible to break out of a recession because business can’t hire people until they know the recession is over, but the recession can’t end until business starts hiring. If this is true, then how did we overcome the dozens of prior recessions the country faced? The fact of the matter is that the real uncertainty which bothers business is that Obama has imposed an incredible amount of new costs on businesses and consumers, and those costs aren’t known yet because of the way he did it, i.e. they are uncertain. No one in their right mind would commit to expanding their business if their costs could double any day or if consumers might find themselves socked with dramatically higher taxes and healthcare costs at any minute. That’s the real heart of the problem.
(2) Evil Congress wants to raise everyone’s taxes! They also want to slash spending, especially military spending. Yeah, right. Forget that Obama has been the one pushing for both things. Forget that the Democrats refused to negotiate the budget deal in good faith. Forget that Obama is the one who demanded the military cuts as part of the budget deal. Yeah, forget all of that and then you can blame the Congress because they have been unable to overcome the Democrats to stop these things.
It’s funny how Politico can miss the obvious. They actually worry that the nation is headed toward a “fiscal cliff” when these trillions in tax hikes and spending cuts will kick in on January 1, 2013 and they attack the Republicans for playing politics with this and for now leaving town on recess. They go back to the old MSM canard of calling the Congress “dysfunctional.” Yeah, ok, and who is to blame here? Nothing the House does gets passed in the Senate. Harry Reid won’t even bring Republican bills to a vote. Heck, he wouldn’t even allow Obama’s budget to be brought to a vote. And it was Reid and Obama who have been playing politics on the Bush tax cuts, first refusing to extend them long term and now using them for class warfare purposes. And it was Reid and Obama who pushed the idea of automatic spending cuts as part of the debt deal because they refused to agree to any responsible cuts. So if this is bad for Obama, it’s a problem of his own making.
(3) The evil central bankers around the world have refused to print more money! This gets rich. Politico notes that the Fed has a dual mandate to fight inflation and to “do whatever it can to boost employment” -- that’s actually not true, the dual mandate is to fight inflation and encourage growth, which is not the same thing as employment. Then they whine that all the Fed is doing is fighting inflation “despite no signs of any inflation.” Wow. First, inflation is soaring. Food and fuel inflation has run anywhere from 12% to 25% under Obama, not to mention that quality and quantity has been cut to try to mask price increases. It’s only if you look at official inflation, which excludes the things which inflate that you get to around 2%. Secondly, the Fed has done amazing amounts to promote growth. For one thing, it’s kept interest rates near historic lows since 2008. For another, it’s pumped vast amounts of new money into the economy through several rounds of quantitative easing. So what exactly hasn’t the Fed done?
Politico also blames Europe for being a drag on the world economy and the European Central bank for doing nothing to help. Total ignorance. They also specifically blame the Germans for not bailing out the other European countries, as if Germany was obligated to pay off the debts of Greece. Should we be paying Mexico’s debts?
ConclusionThis is low-grade economic idiocy and it’s premised on “facts” that are simply untrue. What interests me the most, however, is the attitude. The economy is bad because those evil capitalist who need to be put up against the wall have consciously tried to make us look bad and didn’t continue to do the things capitalists do when we started attacking them. The Fed owes us jobs and needs to keep spending to help Obama. Those lousy Europeans have sabotaged us by not fixing their damn problems and paying off debt that doesn’t belong to them. And that Congress. . . damn them, they didn’t overcome Obama’s policies enough to prevent Obama from being bitten in the ass by them.
Talk about whiny and talk about having NO grasp on reality. Do we really ever want to implement a policy put in place by people who think like this?
P.S. Don't forget, it is Star Trek Tuesday at the film site.
Monday, July 16, 2012
Whedon Is Wrong, And Right
Whedon is something of a conservative hero because he created Firefly, which many conservatives view as a libertarian statement against big government. But make no mistake, Whedon is NOT a conservative, as his latest comments prove once again. Whedon is an atheist feminist who has spoken out against capitalism, and he endorses Democrats, like John Kerry in 2004.
His latest comments came at Comic-Con 2012, where he was asked to explain his economic philosophy in 30 seconds. He said that America is “turning into Tsarist Russia” and that “we’re creating a country of serfs.” He blamed this on capitalism and said that “we are watching capitalism destroy itself right now” because of the gap between the ultra rich and everyone else, which he traced to Ronald Reagan. Then he lamented that socialism is a dirty word in America.
This is wrong on many levels. First, he’s completely wrong to blame capitalism for our recent economic problems or for the growing income gap. The middle class is getting squeezed because government regulations have destroyed middle class jobs and because taxes have eaten middle class incomes so the government could keep spending on the poor and the ultra-rich.
Moreover, the ultra-rich aren’t rich because of capitalism. Some are, but the vast majority of people in the upper 1% are there because they have found ways to milk the government for money and to use the government to shut down their competitors. Wall Street banks are the perfect example of this. They have used their connections at the Treasury to get government guarantees to protect them from risks they take, to unload unprofitable assets, and to keep smaller competitors out of the market. They got billions in bailouts. They used their influence to change regulations to allow them to do things like draw cheap money from the Fed, impose fees on unsuspecting consumers, restrict the power of bankruptcy to their unique benefit, benefit from the sale of government debt, control prices, and engage in trading practices that simply have no justification in economics, like microtrades. They routinely do things that the unconnected go to jail for.
And banks aren’t alone. It is no accident that billionaires like Warren Buffet rarely engage in businesses that aren’t heavily regulated: energy, insurance, railroads, etc. It’s no accident that GE gets environmental regulations imposed on others and then gets those waved for itself or that Pelosi’s healthcare friends get waivers for ObamaCare. It’s no accident that so many of the loans made to energy companies went straight to political donors. The reality is that our economic problems for the past decade have been the result of our government, no matter who is in charge, becoming the tool of the well-connected to extract money from taxpayers and stifle competition. That’s not capitalism, it’s crony corporate socialism.
Secondly, Whedon is wrong in his description of socialism. Here is what he said:
“We have people trying to create structures and preserve the structures that will help the middle and working class, and people calling them socialists. . . . It’s some people with some sense of dignity and people who have gone off the reservation.”Uh, no. American socialists don’t care about the middle or working classes. American socialism is a collection of non-economic grievances founded on spite and envy, and its goals are highly destructive to the middle class. The only economic policy American socialism still advocates is high taxes across the board on all workers, with the money to be used on subsidies to big business and unions, plus increased welfare payments to the very poor. That’s it. Look at the stimulus for proof. The idea behind the stimulus was that giving billions of dollars in middle class tax dollars to big business and unions and boosting benefits for the unemployed would somehow make America better. Obviously, that failed.
Whedon is right about something, however, and it should concern us: income disparity. When you look at history, the countries that fell apart were those where the middle class collapsed, leaving most of the population very poor and part of the population fabulously wealthy. America is trending that way right now, and that's dangerous.
But the key to solving this is not class warfare, it is to stop trying to strangle the middle class. The American middle class is suffering because almost all of our policies involve taxing the middle class to pay for subsidies to the wealthy or the very poor or to fund social experimentation. At the same time, we have actively sabotaged the kinds of jobs that are needed for people to move up the income scale and we keep flooding the country with cheap labor.
Conservatives need to realize this. Right now they reflexively defend the ultra-rich but dismiss any concerns about the middle class as “class warfare.” That's bad. America needs a strong middle class if it is to remain the country we all know and love. And we can’t do that if we make it impossible for people to start businesses or if we keep taxing people's success.
To that end, Republicans should:
● Pass a flat tax with no deductions.Moreover, let's not forget the other ways we are becoming serfs. Day by day, the government is taking individual rights and freedoms supposedly for our own good. Banning 16 oz. containers, forcing you to buy healthcare, trying to control the internet, massive amounts of wiretapping, taking of private property, etc. These things need to stop. American needs to become the land of the free once more.
● Stop standing in the way of natural gas production, which could bring billions of dollars a year to middle America.
● Reform schools so everyone is ready to participate in the modern world.
● Stop the cronyism. End subsidies and eliminate pointless regulations meant only to keep competitors out of the market.
● Strengthen laws meant to make markets more competitive, e.g. anti-trust.
● Clean up the stock markets so that all rules apply equally.
● Break up the biggest banks so the taxpayers stop backing risk and only insure genuine savings.
● Fix the bankruptcy laws to allow a genuine clean start again.
● Reform healthcare to bring free market competition, as we’ve discussed many times.
● Reform the legal system to reduce verdict sizes and discourage frivolous suits.
● Reform government to stop it from taking ever more of our rights.
Tuesday, July 10, 2012
Zombiconomy
In normal times, an economic recovery following a recession will produce real economic growth of around 4-5% and will restore all the jobs lost plus add a few more. That’s not happening this time. Instead, growth has been an anemic 1-2%, and the economy has come close to dipping back into recession three times now. In effect, the economy is stumbling along at the edge of recession. How bad is it? Well, it’s the weakest recovery since 1948!
Moreover, the jobs numbers are horrid. Just to keep pace with population growth, our economy needs to produce 120,000-125,000 jobs each month. In June, this “recovery” produced only 80,000 jobs. In May, this was 77,000 jobs. In April it was 68,000. All told, only 2.6 million jobs have been created since June 2009, for an average of 72,200 per month. That means for the last three years, 50,000 people have joined the workforce each month without finding a job. And that is on top of the millions of people who lost their jobs when the recession began. Indeed, we still have about 5% fewer jobs than we had before the crash.
And it gets worse. As people are running out of unemployment benefits, they are trying to get onto permanent benefits like disability. Remember how the economy produced 80,000 jobs in June? Well, 85,000 workers left the economy that same month to go on disability. That’s right, and that wasn’t an unusual month. Since June 2009, the economy has produced 2.6 million jobs, but 3.1 million workers have gone on disability! That’s unsustainable.
These problems are going to get worse too. To get a genuine recovery, an economy must reach “escape velocity.” That’s the point where economic conditions become strong enough that the recovery sustains itself. In other words, the point where there is enough production that enough new workers must be hired that their incomes begin to spur demand, which requires more production and creates more jobs: a virtuous circle, where good things lead to more good things. If an economy can’t hit that point, then it will slip back into recession or stumble along at the edge of recession, like Japan has done for the past couple decades.
Right now, there are four things preventing the economy from reaching escape velocity:
1. There’s just not enough good news to make people believe the worst is over. Housing and factory orders are up, yes. BUT they are weak and consumer confidence is falling at the same time. The rental-market has hit an all time high in terms of number of people renting, meaning people aren’t buying. And China has slowed its buying.This is a recipe for stagnation and collapse before the election, not a recipe for growth and happiness. And that’s really bad for Obama. Now the Republicans need to work to make sure they know how to fix this once they take over. For that, I would recommend:
2. Uncertainty more than anything keeps people from acting, and right now everything is uncertain. Right now no one knows how much of ObamaCare will ever kick in, and until that’s clarified, people won’t hire. Add in the fact that a business would be foolish to act before the election, and you have a recipe for inaction. Inaction means recession.
3. Business has gotten hooked on handouts from the Fed and the other central banks over the past four years, and they are waiting for their next hit of free junk. Ditto on the continuing “stimulus” bills. Why buy anything when Santa keeps coming back to your house?
4. Finally, those banks Obama fixed. . . the ones who now control so much of the economy. . . well, they aren’t fixed. Dozens of them are being caught up in an interest rate manipulation probe across several countries. JP Morgan lost $2 billion in bad trades. Many of them still hold debt that will never be paid. And Greece and Spain and Italy hang around their necks like an inflated albatross.
1. Stopping the continuous stream of handouts through stimulus bills and Fed “quantitative easing.”Thoughts?
2. Repealing unnecessary regulations. But this needs to be done in one shot so business won’t keep waiting for more.
3. Killing ObamaCare with any means possible as quickly as possible.
4. Breaking up the big banks into component parts and keeping people’s savings (the money taxpayers guarantee) from being used for speculation.
P.S. Don't forget, it's Star Trek Tuesday at the film site.
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Monday, May 21, 2012
My Big Fat Greek Meltdown
By: T-RavWhile we’ve been distracted this past week by claims of Cherokee ancestry and Obama’s new status as “the first gay president,” the status quo in Europe has finally reached the end of the road. The only question now is whether the leaders over there realize this and are prepared to take the necessary steps to save their countries—and the signs aren’t promising.
By “status quo,” of course, I mean the overarching, overbearing welfare state apparatus found nearly everywhere on the continent, and also the cessation of much national authority to the technocratic EU government in Brussels. It’s a grand dream, really—the idea that a “United States of Europe” could be created, based on social democracy, multiculturalism, and other cherished principles of the Left. But when they tried to implement this dream through their transnational government and a common currency, the euro, Europe’s leaders, like all utopians, forgot the realities on the ground.
Take Greece. Greece is traditionally one of the smaller, poorer economies in Europe, but in recent years it has benefited from membership in the EU and the use of the euro. Wealthier nations, such as the UK, France, and Germany are able to invest in it, which helps it pay for public projects and thus maintain a much higher standard of living than it normally would. Simply put, Greece for the past decade or two has been a welfare state in every sense of the word. And it was a fun little deal while times were good. The global economic slump of the past few years, though, has caused the government’s high debt and precarious finances to catch up with it. To prevent a total national collapse (which would also hit the aforementioned investors hard), EU leaders cut a deal with the Greek government earlier this year, in which it got a bailout package of 130 billion euros from Brussels (in addition to other, previous aid packages); in return, Athens was required to go full austerity, drastically cutting expenditures and raising revenues (i.e. taxes) across the board, in order to repay this loan in a timely manner. In other words, a country which for the past generation has enjoyed relative prosperity by kicking its expenses down the road was now required to pay for everything itself. Right now. What could go wrong?
Plenty, of course. Between then and now, but especially over the past few weeks, Greece threw a very violent fit. In between periodic riots, national elections were held on May 6, and the two coalition parties, the Conservatives and the Social Democrats (and that right there should tell you all you need to know about European-style conservatism), who had signed off on the deal, took a shellacking, totaling less than a third of the vote. A much larger share went to fringe parties on the left and the right—including the Greek Communists and something called “Golden Dawn,” a neo-Nazi extremist group which has as its logo a modified version of the swastika and which advocates putting immigrants in work camps and turning the Turkish border into a minefield. As if that wasn’t bad enough, talks for forming a new government with either side of the spectrum have collapsed—proving how much they have in common, both the far left and the far right are adamant that the bailout deal with the EU be scrapped because it’s too detrimental to the Greek people. So now there will be a new round of elections next month, in which “Golden Dawn,” the Communists, and others are widely predicted to get an even larger share of the vote. So it might not be long before we see a black-shirted torchlight parade through downtown Athens. Either that, or civil war. It’s kind of 50/50 at this point.
Regardless of what happens, though, Greece’s exit from the euro is only a matter of time, and probably not much time at that. All of these bailouts have been bankrolled, more or less, by Germany, which is currently just about the only state in Europe with a decent economy. In fact, it’s practically the only thing holding the Eurozone together at all. But Deutschland’s pockets aren’t infinite, especially not now, and it wants a return on its investment, demanding that the Greeks either undergo a thorough restructuring of the economy, including a continuation of austerity, or drop the euro as its currency. Given that the Parthenon pols have basically responded by calling the Germans latter-day Nazis and such, it’s not hard to see which way the wind is blowing. A month ago, you couldn’t find anyone among the elites who would admit that any Eurozone country could depart from it; now, it’s being openly discussed.
So why is this such a big deal? Well, that’s the tricky thing—after reading numerous articles on the subject, I have concluded that no one really knows what would come next. It will probably cause short-term havoc. Over the past week, a major bank run to the tune of over a billion euros has taken place in Greece, as citizens anticipating a change in currencies have been withdrawing their money. This is not something you ever want to see, for obvious reasons. It’s also not too hard to imagine that European unity will be severely fractured by this process, especially since Greece is hardly the only nation in such deep trouble. Ireland, Italy, Portugal, and Spain are all in similarly dire financial straits, and are likely to demand bailouts themselves in the near future. Indeed, Italy just had over two dozen of its banks’ credit ratings downgraded, and Spain is now seeing the first signs of a Greece-style bank run. Their economies are also much larger than Greece’s, though, and the other EU nations combined don’t have the resources to bail out even one of them, let alone all.
This isn’t the real problem, though. The real problem is that their populations show no more interest in facing the reality of austerity than the Greeks do. This is true on both sides of the money transfer, and if you want proof of that, just look at France, which had its own round of elections the same day as Greece. The new Socialist president, Francois Hollande, has proposed a domestic policy that includes a 75% income tax on the rich and a reduction in the retirement age, among other things. The point isn’t that these suggestions are idiotic, it’s that a plurality of Frenchmen would rather embrace them than face up to the reality that the welfare state is officially unsustainable. And as long as that mindset persists, we will not see any progress made in Europeans’ efforts to combat this international crisis.
More likely is a slow disintegration of the euro, as country after country is forced to stop using it; at which point they’ll all return to their individual currencies and the EU is left with considerably less leverage over any of them. What we’re really seeing here, then, is the return of the sovereign nation-state, for better or worse—possibly much worse, depending on how unstable the situation continues to be. As the Chinese curse goes, “May you live in interesting times.”
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Tuesday, May 8, 2012
Fairness My Rear End...
I am sick of hearing Democrats and other leftists the planet over talk about wanting “a more fair society.” They don’t want a fair society. Far from it, they want a deeply unfair society. And their policies are crushing the very middle class they claim they want to treat so fairly.Whenever leftists want to get their spite on against the rich, they talk about “fairness.” They act as if somehow the rich have intercepted a gift meant for us all, and now the left wants to spread it around fairly. . . to redistribute it. But wealth is not gift. It does not fall from the sky, it must be created through hard labor or risk taking. So tell me what exactly is “fair” about taking away the value of someone’s labor or the benefits they have earned from taking risks? That’s called slavery, even if you don’t take 100%. In fact, I doubt very much the left would suddenly decide Southern slaveholders were morally justified if they’d only taken 75% of what the slave made.
In a truly fair world, everyone would have an equal opportunity to achieve their dreams. But that is not what leftists want. They care so little about equality of opportunity that (1) they stand in the way of school reform to keep kids from being educated, (2) they stand in the way of starter jobs through labor requirements and minimum wages, which keeps kids form learning the important skills they need, (3) they tax the heck out of success, which keeps all but the greatest risk takers from trying to achieve their dreams, and (4) they encourage a system that lets the powerful and connected run roughshod over the “have nots” using the government as a weapon. It’s no wonder they want equality of result with these policies, because there won’t be any opportunity. The fact is, they hate success and they want to cap how successful you can be. And in some instances, they want to stop you from even trying to achieve your dreams in the first place. How fair is that?
And how has all of this worked out? The middle class has been crushed. Check this out.
Using official inflation figures, a dollar today is only worth 32 cents of what it was worth in 1979. That means inflation has eaten 68% of the value of the dollar in 33 years. In that time, the Middle Class has seen their median income rise only 40%. That means they’ve taken a 28% pay cut over those 33 years -- almost a percent a year. The poorest 20% of Americans have taken a 50% pay cut.
Oh, but wait! This is all the fault of Republicans slashing government spending, right? No. Government spending increased 714% in that same period. That’s right, federal spending increased more than seven times in the same period where real people took a 28-50% pay cut. Are you starting to see the problem?
If you want to know how bad this is, consider this: in 2012, Americans will pay $4 trillion in taxes. That is $152 billion MORE than they will spend on housing, food and clothing combined. That’s right, Uncle Sam is now a bigger expense in our lives than the costs of food, housing and clothing combined. So when Obama talks about tax rates being low compared to what they used to be, laugh in his lying face. Sure, rates are lower, but rates don’t tell the whole story. Rates don’t cover tariffs, fees, excise, use and sale taxes, they don’t account for disappearing and fading deductions, they ignore the alternative minimum tax, and they don’t account for a million other hidden taxes and the cost of regulations. Remember this article (LINK) which showed how the number of “economically significant” regulations being issued has been souring. An “economically significant” regulation, according to the government, is a regulation that imposes at least $100 million in annual costs on the economy. Clinton issued an average of 56 per year. “Conservative” George W. Bush issued on average 62 per year. And now his downgrade-ness is issuing on average 84 per year. Here’s a handy chart:
This represents hundreds of billions of dollars in lost freedom. Combine that with the lost income and the excessive tax burden discussed above and is it any wonder that the Middle Class is getting crushed?
As a result of this, the economy stinks. The labor participation rate, i.e. the percentage of people working, is at its lowest level since 1981, with 30 million people unemployed. According to Paul Krugman, we are in a depression. And he’s probably right. . . for a change. If you look at how the Great Depression went from 1929 to 1940, you will see a series of crashes with each followed by a sucker rally. Basically, the economy would crash 70-80% in a year, then would appear to rally for a couple years recapturing almost exactly half of what it lost, only to give it all up again and more. We seem to be in the same pattern now unless something changes.
What needs to change? How about the elimination of these regulations strangling our economy or the taxes crushing our people? No one will hire or start a new business when they know Uncle Sam is lurking out there waiting to pounce.
But hey, at least it’s fair. . . we’ll all go down together.
Don't forget, it's Star Trek Tuesday at the film site! (Politics of Trek)
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Tuesday, April 17, 2012
Obama Fails The Economy
Before we talk about how Obama “fixed” the “too big to fail” problem, you might be interested in a little data on those green jobs we’re all supposed to have now.
When Obama took office, he promised five million green jobs in the next ten years. He even spent $90 billion to make that happen. That works out to $18,000 per expected job. Of course, it’s actually higher because that $90 billion is just a baseline and will cause further federal spending, but still, that's not too bad.
So how has he done? According to the White House, rather than creating 5,000,000 jobs, this money now will create only “827,000 job years” over Obama’s four years in office. But a “job year” is not a job. It is instead the equivalent of one full-time position for one year. If we spread these job years out over the ten years Obama used for the five million claim, you come up with a total of 82,700 jobs. And that means the cost per job is $1.1 million. It also means, Obama still owes 4.9 million jobs.
And don’t forget that even beyond this, you have a variety of failures under the crony clean energy loan program out of the Department of Energy, such as Solyndra, Enerl, Beacon Power, Solar Trust for America, and others. Not to mention, the $2.4 billion flushed away on building fewer than 8,000 Chevy Volts no one wants.
Call me crazy, but Obama’s attempt to create a Mussolini-like industrial policy appears to have been a colossal failure.
Now we get word that Obama has made the “too big to fail” problem worse. Imagine that. When Obama came to power, he promised an end to “too big to fail” so that taxpayers would never again need to support failed banks. Then he signed the financial reform bill, Dodd-Frank, which supposedly did that. . . though Republicans claimed otherwise. Bloomberg News now reports that the five biggest banks, i.e. those that are too big to fail, increased their share of all banking assets from 43% in 2007 to 56% now. That’s right, those five banks absorbed an additional 13% of all the banking assets in the country under Obama. In total, these five banks (JPMorgan, Bank of America, Citicorp, Wells Fargo and Goldman Sachs) now control $8.5 trillion in assets. Moreover, the size of the banking sector compared to the rest of the economy has doubled in the past decade, making banks even more “too big to fail.” That means the problem is much, much worse than it was before the TARP bailouts.
Obama has flushed money down the toilet while squandering opportunity after opportunity to actually fix the economy and protect the country from another meltdown. His failure to act is shameful and dangerous. Let us hope the Republicans fix these problems when they finally gain control over the government.
As usual, don't forget it's Star Trek Tuesday at the film site!
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Wednesday, March 14, 2012
2012 Election: Predicting The Future
● The Race Is Over: For Santorum to win the nomination, he must win more than 65% of the remaining delegates throughout the race. But even if you combine all of Newt’s and Rick’s votes, Santoronewt has only hit this magic number in two states: Georgia (66%) and uncontested Kansas (66%). In most states they get 51%.
Further, the math is about to get uglier for Santoronewt because they have just about run out of southern states and small farming states where Santoronewt does well. Consider California. In California, Santoronewt gets only 38%. That means, Santoronewt needs to make up 55 additional delegates in the other states just because of California. That means the 65% average mentioned above goes to 69%, something Santoronewt has never hit. Illinois, New York, Maryland, New Jersey, Oregon, Utah, Rhode Island, Delaware, Connecticut, D.C., Puerto Rico and New Mexico all show similar polling numbers. Hence, it is impossible for Santoronewt to win.
And it gets worse yet because not all of Newt’s supporters will go to Santorum. If 10% of Newt’s supporters stay home, Santorum then needs to average 68% instead of 65%. If they vote for Romney, Santorum needs 71%. If 30% of these people jump to Romney, suddenly Santorum needs 83%. Any analyst who tells you this race can still be won is lying.
Santorum knows he’s finished too, as demonstrated by his new wishful thinking strategy. Indeed, his team said this weekend that they intend to stay in the race despite this math because they are hoping the convention delegates might decide to go against their own voters and choose him at the convention. Yeah, and Satan might fly out of his ass. In the meantime, Santorum continues thrashing about. Now he’s accusing Fox News of “shilling” for Romney (after slandering Drudge as a “cheerleader” for Romney), and he keeps whining about Romney’s money. When you start offering explanations for why you can’t win, then you know you’ve lost. Put a fork in him. . . a pitchfork.
● Why Obama Will Lose: I know Obama will lose. No, I do not have access to a newspaper from the future. If I did, I would be out messing with the timeline! But I do know what motivates voters and I can tell you that Obama has lost. Here’s proof.
(1) I’ve said for some time now that voters have given up on Obama and no longer listen to him. This means he can’t win them back anymore. Here’s proof of that: Obama’s approval ratings are not keeping up with growing consumer confidence (LINK). This means the public is not giving him credit for economic growth. Translation: he’s doomed. Also, 80% of people polled say they are NOT better off than they were four years ago. Translation: he’s really doomed.
(2) According to Rasmussen, 59% of the public view Obama as more liberal than they are. You can be seen as more conservative and still win in this country, but you can’t be seen as more liberal and still win.
(3) Only 37% of voters say their views are more like Obama’s than the GOP contenders (who get a combined 53%). That’s the real approval gap right there, and the Republicans are ahead by 16%. And this is despite all the nastiness of the primary.
(4) In the Oklahoma primary, Obama only got 57% of the vote and he lost 15 counties. This suggests that the left remains upset and disillusioned with Obama. I wouldn’t draw too much from this, except polls also show that the Democrats are suffering an 8% voter enthusiasm gap (53%-46% compared to GOP enthusiasm). Even 2% can cost an election.
But there’s more. Romney has shown no interest in many of the other possible VP candidates: Palin, Cain, West, etc. Indeed, he never mentions them and they’ve all attacked him. Rubio hasn’t. It’s also highly unlikely that Romney would pick one of the other jokers in the race. When the question came up about a picking a "conservative" VP, Romney said, “Well, that would preclude, of course, Rick Santorum.” Yes. . . yes it would.
So he could be looking at a Christie, a Nikki Haley or a Rubio. But Christie is a northeasterner and Romney won’t do that. Haley is not especially popular even at home. He might pull a surprise and pick Rick Snyder, the Tea Party governor of Michigan, or Rick Scott, the Tea Party governor of Florida, but they’re both white dudes and also not very popular. He might pick New Mexico Governor Susana Martinez, who is also Hispanic, except she’s very raw and she doesn’t bring much cache. So Rubio is the best choice.
But that’s just guess work. If you really want to know what’s going on, follow the money. Rubio has assembled a team to prepare his image for the national stage. This team includes people who handled re-election campaigns for George W. Bush, Jeb Bush, John McCain and Arnold Schwarzenegger. He’s also racing to publish his memoirs this fall, and his publisher has been leaking details to boost his image. He’s even spent $40,000 to hire investigators to investigate his own background so he knows everything that will end up in the Democrat’s opposition research file. These aren’t things someone does unless they expect to be thrust onto the national stage immediately (as compared to 2016). I would bet Rubio is spending this money and rushing his book because he and Romney have already cut a deal and Rubio is vetting himself for a quick announcement once the primary race winds down.
● Finally and unrelated: I don't normally pass on links, but I know many of you are history buffs and these are some incredible Civil War pictures -- high quality, amazing images, well worth the time. (The Atlantic)
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Wednesday, February 22, 2012
Kris Kardashian's Butt: Capitalism In Motion
There is nothing redeeming about the Kardashians as far as I can tell. They’re like a combination of the Manson Family, the Addams Family, and a porno. But I do like one thing about them. See, I never would have made them famous, but somebody else did. And that’s what makes capitalism great. Stick with me here.
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| The Addams Family Porno |
Ditto with the NFL. The NFL combine begins on Thursday as a large group of male sportswriters and NFL types get together to take nice long looks at a bunch of male athletes and judge them on how they look in their underwear. And no, I’m not kidding. Sounds kind of gay, doesn’t it? But more importantly, it sounds kind of dull. But get this, people watch it. Not only that, they talk about it, they write about it, and somebody even included it in a videogame. Just like Kris Kardashian’s butt, somebody guessed right.
The point is simple: if it were up to me to run the world, there would be no Kardashians and I never would have thought to put the NFL draft on television. It’s only because our system doesn’t rely on me that we have these things. Now imagine what else the world wouldn’t have if it were up to me to decide what people could watch, read, buy or believe?
Now let’s consider a man named Gary Lineker. He’s an a-hole from Britain who announces soccer games. I’m told soccer is some sort of sport. Old Gary, who hosts a program on the BBC, says that soccer players earn too much. Indeed, he thinks they shouldn’t be paid more than nurses or teachers. Gary’s a flaming hypocrite because he gets paid £2m a year for basically flapping his lips. But let’s not worry about that because hypocrisy is the new black in fall fashions. Instead, let me ask a series of questions to see if I can enunciate the problem with Gary’s line of “reasoning.”
What happens to the rest of the money soccer earns if it doesn’t go to salaries? It would go to club owners. So really Gary has decided that some people shouldn’t be made millionaires because that’s unfair to billionaires. But how can all these billionaires be so stupid as to pay this amount of money to the players if they aren’t worth it? And what gives Gary the right to decide that he knows better than the billionaires how much to pay the millionaires?
In truth, Gary doesn’t care about the billionaires. He’s just a spiteful little turd who doesn’t like some people earning more than others. But why pick teachers? Why not convenience store clerks? Why even pay soccer players at all? They should be like government employees should be and they should play for room and board. . . and live on a plantation. In fact, now that I think about it, why do teachers earn so much? Teachers should earn $1 an hour. And my opinion is as valid as Gary’s so why don’t we go with my opinion?
Also, while we’re readjusting the world to our own prejudices, I don’t like really soccer and people shouldn’t be allowed to watch it because I don’t like it. And before you try to tell me that people want it, let me just cut you off and say that I don’t care what people want, because I know what’s best.
Get the point?
Here’s the thing. Capitalism works because it lets millions of people try to sell their ideas to millions of other people in the form of products and services. When a want or need appears, somebody fills it, they don’t have to wait for me to decide if it should be filled. And through the trillions of decisions made each day by every single one of us, the human race goes about making each other happy.
It’s only when the *ssholes get involved and decide they want to control what people get paid or what products can get made or what ideas can be brought to life or which companies should be winners and which losers that things fail. That’s when there are no Kardashians or NFL draft or new cars or butter or health care. . . just lots of lousy GM cars nobody wants. And every dollar the government sucks away from us and every regulation they impose to help some crony is a decision the government deprives us from making. Government is the enemy of freedom.
So let’s all raise a toast to Kris Kardashian’s butt, to rap music, to overpaid athletes and a million other things we don’t like but which somebody else does, and let us thank God that for a brief moment our country was bright enough to adopt capitalism. It shall be missed.
P.S. There’s a Politics of Trek article up today at the film site.
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Thursday, February 9, 2012
Government Dependence Is Killing America
According to the Heritage Foundation, dependence on the federal government rose 23% in the first two years under Obama. That’s the biggest rise since Jimmy Carter. What's worse, almost every year sees a rise, and the cumulative effects are staggering. In the last two years, the number of people dependent on the federal government has risen 7.5% to 67 million people. That means 22% of the population, one in five people, is a ward of the state. And that’s just the tip of the iceberg because more than 49% of all Americans, 152 million people, live in a household that gets a check from the government.
Think about that.
Half of all Americans look to the federal government as a source of income, and one in five look to it as their primary source of income. Do you think those people will support cutting government spending? Unlikely. At this point, these people eat up 70% of the federal budget -- they claimed 25% in 1962 and 48% in 1990.
Further, 49.5% of all Americans pay NO income taxes (it was 12% in 1960). Do you think those people have any incentive to stop the growth of government?
America has become a country where the many mooch off the labors of the few. This is a disaster because it gives millions of people a strong incentive to vote to keep taking from the rest. And that is highly destructive to the fabric of the country. Why? Because a culture of dependence is forming where a majority of Americans see the government as provider. They have essentially become useless. . . a drain on society. But they have political power because of their sheer numbers and they have no shame in using the government to steal from everyone else. Essentially, the unproductive are using the force of government to make the productive into their slaves.
This must end and it must end fast because dependence makes people unable and unwilling to change. So long as this continues, these people will entrench themselves further and they will ultimately destroy the country in an orgy of debt.
After I started this article, I ran across an article about Jim DeMint. DeMint is the real intellectual Godfather of the Tea Party and must be credited with shaking Senate Republicans from their slumber. DeMint has put out a new book in which he says what I am saying above:
“Dependent voters will naturally elect even big-government progressives who will continue to smother economic growth and spend America deeper into debt. The 2012 election may be the last opportunity for Republicans to win enough votes to win the presidency and a majority in Congress, and enact policies that might turn our nation around from the imminent threat of fiscal calamity.”This is a significant point. So long as the GOP lets the Democrats (and fellow Republicans) keep adding people to the government dole, we are making it harder and harder to win future elections. It’s a vicious circle, and it needs to be broken.
Interestingly, when DeMint was asked about the presidential candidates, he deferred, but he made two points very clearly: (1) winning the election trumps everything else because of the need to stop this culture of dependence, and (2) the winner of the primary must adopt/focus on Ron Paul’s ideas of individual liberty, cutting the power of the Federal Reserve, and limited government. Said DeMint:
“If our nominee doesn’t pick up a lot of Ron Paul’s ideas, we’re missing the boat and we’re missing a lot of people who could help us build our party. These are not wild ideas.”I have to agree. I think that a sane Ron Paul without a surrenderist foreign policy would be an unbeatable Republican candidate in almost any election, and especially in this election. The question is, who is this person? Jim DeMint is about the only name that comes to mind at the moment.
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Wednesday, December 7, 2011
Of Idiot and Egomaniac
OMG! Obama’s right about something. . . sort of. How the heck did that happen?! Also, bad, arrogant, delusional Newt is back, just in time for Christmas! And you won’t like what he said.● Dateline: Obama’s Brain(sic). As Obama stopped over in Kansas (while telling the crowd he was in Texas. . . “hello Cleveland!”) on his way to his vacation in the coolest of the 57 states -- Hawaii, which is now in Asia, Obama actually said something mostly correct. He noted that people have been losing their jobs not because of “the business cycle,” but because of technology: “you saw many in your profession replaced by ATMs and the internet.” Ya don’t say?!
Ok, let’s think about this for a moment. Could it be that the big enemy isn’t China or decades of Reaganomics or those evil rich just not paying enough in taxes? Could it be the real reason people lose their jobs is technology?
Actually, yes. The sad truth is the biggest job killer is technology. The tractor killed the farm hand. The robot killed the factory worker. The computer killed the typing pool. The internet is killing retail. It is a cycle. And this cycle will never stop. That’s why it’s so vital that America always remain a land of innovation and opportunity. We need to keep making new jobs to replace the ones that will disappear because of technology. That means companies need to be free to take risks. If companies are prevented from taking risks, the only way they can survive against the competition is to find efficiencies, and efficiencies means layoffs. It is a simply truth: risks = jobs, efficiencies = layoffs.
Yet, the Democrats do everything within their power to kill risk. They regulate business to the point it becomes impossible to take risks. They tax those who earn “too much” and thereby eliminate the reward that comes with taking successful risk. And they saddle the economy with trial lawyers and easy litigation to make risk just too risky. This is how liberalism destroys economies. It destroys the ability of “those who would” to generate new jobs to replace the old ones that naturally disappear over time.
For possibly the first time in his life, President AAAhole is onto something. Too bad he doesn’t understand the implications.
● Dateline: Newt’s Brain. The only thing bigger than the gaps in Obama’s knowledge is Newt’s ego. And we’ve just been treated to yet another classic example of this. Said Newt to fellow blowhard Larry Kudlow:
“I was part of Jack Kemp's little cabal of supply-siders who I think, largely by helping convince Reagan and then working with Reagan profoundly changed the entire trajectory of the American economy in the 1980s. You could make an argument that I helped Mitt Romney get rich because I helped pass the legislation that —”Uh..... To use a slight paraphrase of a famous and devastating debate line from Lloyd Benson, “I knew Ronald Reagan, Mr. Gingrich, and you should shut the hell up about teaching Reagan anything you like punk.”
Newt was first elected to the House of Representatives in 1978. By that point, Ronald Reagan had already been Governor of California for two terms and had run twice for president (1968 and 1976). He had advocated conservatism since the 1950s. He endorsed Barry Goldwater a year before Newt got his college degree. So F-you Newt if you’re going to claim that YOU had to convince Reagan of anything, least of all his signature idea, which he was already advocating when you were still in diapers. . . you turd.
This is the problem with Newt: he’s insane. And I don’t mean in an endearing way like crazy uncle Ron Paul and his gold-standard flying saucers. Newt is insane in the way that serial killers are insane. He’s a bigger narcissist than Obama. He doesn’t think God speaks to him, he thinks God comes to him for advice. And he genuinely believes the fantasies he invents. And it gets worse. . .
● Dateline: Trump This. Newsmax is stupidly teaming with Donald “the fraud” Trump to put on a Republican debate on December 27th. Would our candidates really crawl on their bellies to this fraud? Oops, I mean, is this really a good idea?
Fortunately, we didn’t have to wait long before Jon Huntsman to his credit became the first to discover his sense of self-respect and refused to go. Ron Paul immediately followed suit, adding that “the selection of a reality television personality to host a presidential debate. . . is beneath the office of the Presidency and flies in the face of that office’s history and dignity.” With the course firmly set by the others, Romney made the bold decision to follow the crowd. So we’re all agreed, right?
Well, no. Newt’s going. In fact, the shameless egomaniac flew to Trump’s side to blast the evil Ron Paul. . . by denigrating Ronald Reagan. Indeed, when asked to respond to Paul’s claim that Trump’s participation would be beneath the dignity of the office, Newt actually said:
“This is a country that elected an actor who made two movies with a chimpanzee to the presidency.”WTF?! And like that, I have ruled out another candidate.
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Monday, October 17, 2011
Immigration: Reality Strikes Liberals Again
If you haven't seen it yet, my latest article is up at Big Hollywood (Click Me).Sometimes it’s amazing how daft leftists can be. We spent more money than we could afford and now we’re broke? How did that happen?! We tax rich people and they send their money overseas. Nobody could have seen that coming!! We let criminals out of jail and somehow the crime rate soars?! How? Now liberals have discovered that massive immigration depresses wages. Ya think?
While Britain’s Labour Party was in power between 1997 and 2010, they threw open the immigration doors to let pretty much anyone who wanted into Britain into the country. Part of this had to do with new European Union rules which allowed free movement from Eastern Europe and part of it was leftist political correctness which sought to de-British Britain.
To give you a sense of how open the doors got, consider these figures:
● Between 1980-1991, the UK lost an average of 42,000 people each year.A couple weeks ago, a report was released, which had been commissioned by Labor when it was in power and then suppressed, because Labour didn’t like its conclusions. In fact, they ran around telling the public the exact opposite of what the report found. But now the truth has come out.
● Between 1992-1995, the UK gained 9,200 immigrants per year.
● Between 1996 and 2010, under Labor, the UK gained 178,000 per year.
According to this report, this wave of immigrants flooding Britain depressed British wage and “undercut” British workers. You don’t say?! It was so bad in fact, the Labour Party has had to admit Labour “got it wrong” on immigration and concedes this “had a big effect on people in Britain.” Great. . . now explain why you kept lying about it?
But can they seriously claim they had no idea this would happen? Assume you make widgets and you need a new worker. In Room A, there are two potential employees. . . they look surly. In Room B, there are 500 potential employees. Do you think you will end up paying more if you hire from Room A or Room B? It’s pretty obvious isn’t it? Yet, somehow it was never obvious to liberals that flooding Britain with workers, i.e. turning Britain’s labor market from Room A into Room B, would have a negative effect on the workers already in the country? How stupid do you need to be not to see that coming? Oh, that’s right, liberals don’t think about the future, they assume there are no unintended consequences.
Britain has shown that the consequence of importing a ton of labor are very clear. It will increase the competition for jobs, which will result in wages being depressed because there are more people bidding for the same number of jobs.
Now let's look at America. We are letting people in at three times the rate the British were when they “got it wrong”. . . we are letting enough people into this country every year to populate Denver, Colorado. That’s unsustainable.
The Democrats support this because they think these immigrants will vote Democrat, which will overcome the white flight their party has experienced. But what do they think the effect will be on the wages of blacks, Hispanics and uneducated whites.... the very groups the Democrats claim to want to help? The fools currently squatting outside Wall Street want this too (check out Bev’s article on their list of demands). Those idiots want both (1) a hike in wages and (2) open borders. But of course, those are contradictory demands because once you open the borders, wages will crash. Not surprisingly, Big Business wants this too because it keeps their costs down.
Talk about an unholy alliance!
I'm all for immigration, but there need to be limits. Clearly, three times the British level is too much.
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Thursday, September 15, 2011
Jobs Bill: The Obama Is In The Details
Things are not going well for Obama’s jobs bill. First, there was no bill, even though Obama insisted there was. Then there was a bill, but no Democrats were willing to sponsor it. In fact, they hate it. . . they fear it. Then Republican Congressman Louie Gohmert came along.Obama’s jobs bill seemed destined for failure the moment Obama even announced it. The bill is a disaster of recycled, failed ideas which no one really thinks will do any good. The left hates it. The right hates it. Rasmussen says that only 38% of the public supports the bill. Even among Democrats desperate to do something. . . anything, this bill has been about as popular as the plague.
● Sen. Jim Webb (Va): “Terrible.”That’s why no Democrats have been willing to sponsor the bill.
● Sen. Mary Landrieu (La): “That offset is not going to fly, and [Obama] should know that. Maybe it’s just for his election, which I hope isn’t the case.”
● Sen. Tom Carper (Del): “I think the best jobs bill that can be passed is a comprehensive long-term deficit-reduction plan. That’s better than everything else the president is talking about combined.”
● Rep. Raul Grijalva (Az): “There is serious discomfort with potentially setting up Social Security as a fall guy.”
Enter Republican Congressman Louie Gohmert. Gohmert has represented Texas since 2005. In 2008, he offered an alternative to the stimulus that would have given the country a tax holiday. In 2009, he cosponsored a bill that would have required presidential candidates to provide a birth certificate. Now he’s gone after Obama’s jobs bill, and what he’s uncovered is pretty shocking.
First, Obama’s bill would turn the unemployed into a protected class similar to ethnic minorities. Thus, if an unemployed person applies for a job and is not hired because someone who currently has a job is hired instead, that person can sue the company for discrimination. Seriously.
This is HUGE! Think about what this would do. The effect would be to (1) freeze everyone in place at their current jobs because no one would hire anyone who has a job, (2) stop all but essential hiring because of the risk of litigation, and (3) spur tons of frivolous litigation in the hopes of striking it rich or getting bought off. This would become the “Unemployed Litigants Enrichment Act.” You would literally see unemployed people bringing an avalanche of suits in the hopes of squeezing some cash out of local businesses.
This would destroy American business.
Secondly, there is a clause in this legislation which provides that any state that accepts federal money under any program will automatically waive its 11th Amendment protections (called “sovereign immunity”). That means states could then be sued for employment discrimination. Combine this with the unemployment bit above and you’ve got a recipe for the unemployed enriching themselves at the expense of the taxpayer. Even without the extra employment bit, this still would be a goldmine for employment lawyers.
These provisions are insane, which is why Obama is trying to create a sense of urgency to get the bill passed before anyone reads it. Hence, he spent the day talking about the “employment crisis” and our “national emergency.” Fortunately, this will never pass a Republican Congress. Heck, I doubt it could pass a Democrat Congress.
Finally, you should know that Gohmert has struck again. Since the Democrats have been unwilling to introduce the bill, Gohmert stole the name of Obama’s bill and introduced his own “American Jobs Act.” This is a two page bill that eliminates the corporate tax!
So yes, Mr. President. . . let’s pass the American Jobs Act now!!
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Tuesday, August 9, 2011
Taxes: Main Street v. eStreet
Today’s topic involves an issue about which I am conflicted. Should states be allowed to “tax” internet merchants? I put “tax” in quotes because that's not actually what's going on. The real question is: should states be allowed to force internet merchants to collect sales taxes from customers? This is a much more complicated issue than it seems at first glance. Here is the problem as each side sees it:
1. The State View: Americans buy about $10 billion a year from the internet (and growing). But as a practical matter, states can’t tax this. Technically, they can and do tax it, but they can only collect the tax from the purchaser. Indeed, most states have laws requiring you to report what you purchase and pay tax on that. . . fat chance.
From the state perspective, this is lost revenue. To solve this problem, states keep trying to force internet retailers (e-tailers) to collect sales taxes just like bricks and mortar retailers do. Right now, e-tailers don’t do that, and states don’t have the power to force them.
The reason states can’t force this is the way jurisdiction works in the United States. To be able to regulate (and tax) a business, that business must have some “nexus” to the state. But the term “nexus” isn’t clearly defined. Operating a warehouse within a state clearly constitutes a nexus. Having a retail operation does too. But what if people buy from your catalog or off your webpage? So far, the courts have always said that is not enough to form a nexus. Thus, states can’t force e-tailers to collect sale tax for them. . . though they keep trying.
California is the latest state to try. What they’ve done is to declare that any e-tailer who deals with local sellers has a nexus to the state. Amazon falls into this category because it partners with small businesses all over the country including California. Because of this bill, Amazon has begun terminating its relationship with all of these people if they are located in California (10,000 were terminated in July). Amazon is also trying to get this bill repealed by referendum.
2. The Main Street Retailer View: Main Street retailers hate companies like Amazon. They have no choice but to collect the sales tax imposed by the state. Thus, they are at a disadvantage to the e-tailers, and the disadvantage can be serious. In liberal states like Illinois, for example, it can reach nearly 12% with local surcharges. That’s a significant handicap when the e-tailer doesn’t have to collect those taxes.
Extending this argument to its natural conclusion, retailers argue that if this situation is not remedied, then e-tailers will eventually wipe out retailers. But keep a couple things in mind. First, these are the same retailers who wiped out the mom and pop shops two decades ago. . . so their argument rings a little hypocritical. Secondly, there are other benefits the retailers get (like property tax breaks) that are not given to the e-tailer. Third, the retailer business model may be defective, and rather than trying to force a tax hike on e-tailers, maybe they should be looking for new services to lure customers back into their stores. Fourth, some products simply aren't amenable to the e-tailer model.
3. The eStreet Internet Retailer View: The e-tailer response is twofold. First, to allow states to force them to collect the tax would make them a special case that violates 200 years of jurisprudence. It’s the business equivalent of letting New York haul you into court just because you sent a letter to someone who lives in New York.
Secondly, e-tailers make a practicality argument. There are 8,000 different tax jurisdictions in the US, each with different rules, procedures and rates, which change at a moment’s notice. Moreover, these jurisdictions don’t align with zip codes. Thus, it would be a practical nightmare for a company like Amazon to assess and collect the right amount of tax. It would be impossible for smaller e-tailers. This change could effectively kill off all but the largest e-tailers.
4. My View: Politically, I am conflicted on this. As a firm believer in federalism and the 10th Amendment, I generally favor letting states handle their own affairs. . . even if they make a mess of it. So they should be allowed to tax whatever activity goes on inside their borders provided they don’t discriminate against out-of-state companies. But that argument really doesn’t apply here because they can tax these transactions, they just can’t get it collected the easy way. States have a right to regulate themselves, they don’t have a right to regulate outsiders just because it makes things easier for the state.
And practically speaking, I think it would be disastrous to allow 10,000 tax regimes to force themselves upon e-tailers. What’s more, how can we then be sure they are being treated fairly (i.e. that there is no discrimination against out-of-state companies)? Suppose a single sales tax is imposed on both retailers and e-tailers. That sounds fair, but what about the property tax breaks, utility discounts or other things the retailer gets that reek of local favoritism?
I don’t care for the idea that in the long run we are likely to end up with most retailers going out of business in favor of e-tailers (e.g. book and music stores). But on the other hand, these e-tailers have been very good for consumers even beyond the sale tax issue and the death of the retailer may be inevitable unless retailers find some way to improve their business model.
Right now Senate Democrats are trying to come up with a bill (the Main Street Fairness Act) to “solve” this problem. Amazon supports it, eBay opposes it. Frankly, this sounds like it will impose a fairly heavy regulatory burden on e-tailers. I suspect Amazon likes it because it will make it hard for smaller competitors to enter its market. eBay probably opposes it because eBay relies on thousands of small sellers, who would likely end up violating the new rules.
There may be no good answer, but when in doubt, I find myself coming down against any solution offered by Democrats with the support of the biggest company in the field and with the support of trade groups looking for a little protectionism for their members. So if I had to vote right now, I would vote to leave the system as it is.
What do you think? How would you solve this problem?
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Thursday, July 28, 2011
Time To Talk About A Jobs Agenda
My next article is up at Big Hollywood! Go take a look: (Linky, Linky)! (It's at the film site too.)With the debt crisis continuing to spiral its way through the theater of the absurd, most people aren’t focused on much else right now. But there is an issue waiting on the horizon and I think the Republicans better start talking about it. . . jobs.
The jobs picture is bleak. Official unemployment sits above 9%. Real unemployment remains around 16%. May and June produced only 43,000 jobs, most of which were offset by 30,000 layoffs announced last week. Millions of Americans are out of work, many of them more than 99 weeks now.
Up to now, the Republicans have been happy to let the jobs picture remain bleak. With Obama and 21 Democratic Senators up for re-election, the current bad economy presents a nightmare scenario for the Democrats. Indeed, the Democrats have struggled mightily in recent weeks to come up with a jobs plan. But their ideology has limited them to (1) more stimulus, (2) job training, and (3) minor tax cuts for hiring. None of that will help.
But I think the Republicans need to establish an agenda. I think they need to show that they care about getting people back to work, rather than just cutting government spending. The need to insulate themselves from the charge of do-nothing-ism, and of indifference. They also need to cut off the inevitable Democratic claim that the spending cuts they get in the debt deal caused the current economic situation.
To that end, I propose the following plan for Congressional Republicans:
1. The biggest problems with our economy right now are (1) lack of certainty created by Obama’s constant threats of new taxes and regulations and (2) the drag caused by the red tape Obama and the Democrats have created. The Republicans should form a team to go through the US code/Federal Register (CFR) and identify specific laws/regulations the Republicans want to repeal.This would seem to be a pretty good start and should show the American public that Republicans are very serious about making the US a much more business friendly environment and getting people back to work. It also insulates the Republicans against the standard Democratic attacks.
Start announcing this list one agency every couple weeks. This will give business confidence of the change in the business environment to come and will highlight how much regulation the Democrats have piled onto business. One caveat though, don’t talk about repealing anything that is either popular or can be spun into “they want to kill orphans”. . . do those quietly.
2. Propose the elimination of Social Security and Medicare payroll taxes for teen workers (under 18) and seniors (older than 65). This makes it cheaper to employee these people. This makes the skills the seniors possess more useful and teaches the teens good habits.
3. Propose tax cuts across the board combined with a “revenue-neutral” elimination of deductions/subsidies. This would provide a powerful incentive for people to work, and could not be attacked as helping the rich or as increasing the deficit. What’s more, the Republicans should be pointing out each week the most egregious deductions they will eliminate. This could be a big step toward a flat tax and will go a long to way to breaking the stereotype that Republicans are the tools of big business.
4. Eliminate the corporate tax and the capital gains on the sale of tangible assets (e.g. machinery). This will bring corporations flocking to the US and get them trading in their old equipment.
5. Tort reform. Eliminate class action suits entirely. Make plaintiffs file individual suits and let them be consolidated as multi-district litigation instead. This wipes out the incentive for lawyers to go plaintiff shopping . . . like the guys on TV. Eliminate punitive damages and cap pain and suffering at one million dollars.
6. Free trade deals. There are a series of free trade deals sitting there unratified. These include South Korea and Columbia. These would cause a farming boom in the US and would offset the loss of ethanol subsidies. I would also propose a free trade deal with England and Japan to tie us closer to our friends.
In terms of the timing, I will be a bit cynical and suggest that the Republicans start talking now but delay passing these bills until mid-2012, so that the positive effects don't start kicking in until right about the time Obama is loading up the moving van for Chicago and not sooner.
There are other reforms we could talk about too. For example, doctors should be allowed to practice in any state. The teaching profession should be opened too, by federalizing the licensing requirement and then eliminating the requirement for an education degree. But I would suggest the big push should come on the jobs front.
So what would you add to/subtract from the list? What else do you want to see on a Republican Agenda?
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Monday, July 11, 2011
Should Colleges Pay "Student" Athletes?
College football is a mess. USC has been stripped of its national titles and Reggie Bush lost his Heisman Trophy. Ohio State’s coach just resigned in disgrace and the school gave back its Sugar Bowl win. Oregon was caught paying a middle man to circumvent NCAA recruiting rules, including helping a student change his guardian to a more Oregon-friendly relative. And those are just the tip of the iceberg. Some suggest paying athletes will fix this. I see that as treating a symptom.Here’s the thing: college football is pretending to be something it’s not. To make the game sound like it’s not a business. . . to make it sound “innocent”. . . the NCAA pretends that college football is played by genuine STUDENT athletes. According to NCAA marketing, these are kids who might not have gotten a chance to go to college, but have been able to leverage their athletic ability to get some financial help toward getting their education. And we’re supposed to believe football or basketball or whatever is secondary to these kids’ desires for an education. Give me a break.
In truth, the vast majority of athletes are functionally illiterate. Most won’t graduate and those that do are getting an education in name only. The NCAA has lowered admission standards to the point that it’s almost impossible not to meet the requirements. They allow athletes to take puff classes and even then turn a blind eye as athletes are given answers to tests in advance, have others take tests for them, and are passed no matter what they do. Probably not one in ten can read at a first grade level -- even of the graduates -- and not one in five has ever seen the insider of a classroom.
This is a disgrace. The NCAA is hiding behind the idea that it’s providing quality education to these players so that it doesn’t need to pay them. But it’s not really providing any sort of education. What it’s really offering is the chance to get noticed by the NFL. But only something like 1 in 1600 college football players will make it to the NFL. Thus, the other 1599 will get nothing for their time except whatever equipment they can steal and whatever boosters illegally pay them.
At the same time, college football (and basketball) is a multi-billion dollar business. Teams that win titles and garner nation exposure can rake in $30-40 million a year. Even lesser teams are making millions. These are big businesses, who act like big businesses, pay their management as well as the Fortune 500, have bigger facilities than some state governments, and who’ve found a wonderful way to keep their labor costs down. . . actually free.
It’s this inequity that causes many to suggest it’s time schools paid athletes. But that misses the real point that the whole system is a corrupting fraud. The NCAA is sending all the wrong signals: (1) Exploiting athletes is fine. (2) There is nothing wrong with providing a fake education so long as the athlete has value on the field. (3) A college degree is just a piece of paper with no real worth except as public relations. (4) The idea of student athletics is a fraud and is not intended for genuine students, but it's ok to pretend because pretending enriches the school. (5) And cheating is acceptable. In fact, getting a whole community of coaches and boosters involved in cheating is fine. . . as long as you aren’t caught.
Paying athletes won’t fix this because it only addresses the first part and it leaves in place the NCAA’s false marketing. The real solution must come from making the NCAA either live up to its promises or stop making them. It’s time the NCAA actually requires athletes to be genuine students with real classes earning real degrees, or it should drop the pretense of an education entirely and allow programs to hire athletes just as if it were the NFL’s minor league, without forcing those athletes to pretend to be students.
Either be a school or be a business, but stop being a business hiding behind being a school. Anything short of one of these two solutions will just keep the NCAA limping along in the unethical land in which it currently resides.
Thoughts?
(P.S. Think about the irony that schools run by leftists are exploiting the labor of poor black kids to enrich themselves to the tune of millions of dollars a year. And they call corporate America "capitalist exploiters"?)
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Tuesday, June 7, 2011
Obama-conomy + Cluelessness Dooms Obama
Obama is in deep trouble, as shown by his sagging poll numbers. Even the biggest bounce he got from the killing of Osama bin Laden has faded, as we knew it would. So once again, the economy and his handling of the budget are front and center, as they will be throughout the election. But the American people don’t like what he’s doing and he has no idea what else to do. How bad are things? Dire.Let’s start with the poll numbers (according to Reuters):
● 49% of Americans disapprove of his handling of his job. Only 47% approve. But that's the good news. . . read on.These numbers are disastrous. This means that literally every conservative and independent disapproves of his handling of the economy and the deficit, and that even some Democrats are starting to disapprove as well.
● 59% of Americans disapprove of his handling of the economy. That's a career killer.
● Only 33% approve of his handling of the deficit. That’s down 6% since April.
● 89% of Americans think the economy is in bad shape. 57% say we are in recession.
● 66% say the US is on the wrong track.
Why would people be so upset? Well, for one thing, inflation is out of control. As we discussed before, inflation is officially in the 2% range, but that excludes food and gas. When we factor those in, our readers seem to think 15%-20% is more accurate. That’s worse than the worst moments under Carter.
Official unemployment remains around 9%, and real unemployment is closer to 16%. As Lawhawk pointed out the other day, no President since FDR has ever been re-elected when unemployment was above 7.2%. And no one is going to hire until Obama changes his policies wholesale.
Not surprisingly, personal consumption is falling. Consumer confidence dropped 10% last month, to an anemic 60.8. Durable goods orders, i.e. what factories are making, declined 3.6% last month (worst numbers since 1984). This means consumers and businesses expect trouble and are hunkering down. And car sales fell 3.7% to well below the level the car companies need to be profitable, and even The Washington Post is calling Obama a liar about his bailout success claims.
And, as anyone other than a Democrat would expect, home prices rose temporarily when the federal home-buying tax credit was in effect, and fell like a stone the moment the tax credit expired. Home values in big urban areas fell to their lowest level since 2002 as foreclosures depressed prices. S&P Chairman David Blitzer refers to this as a “double dip in home prices across much of the nation.” Home construction starts fell too, even though this is usually the start of the building season.
High gas prices, out of control inflation, crashing home values and massive unemployment. . . what’s not to love?
What's really interesting though, is that Obama should have had a good month. The Republicans lost in upstate New York apparently (if you believe the MSM) because of Paul Ryan's Medicare plan. Newt Gingrich attacked that plan too. The Democrats spent the month blasting the Republicans for playing chicken with the debt ceiling, a very serious charge. And a great many people complained that the Republicans were either too aggressive or too timid in budget cut demands. Yet, on the question of who would handle the economy better, congressional Republicans gained 11% points last month!
How can this be? I think the answer is simple: Obama has nothing to offer. He's added $4.6 trillion to our $14.3 trillion dollar debt -- that's 32.2% of the total debt in only three years. And he's offered nothing but token cuts to fix this. Even worse, he and his Democratic friends have opposed everything the Republicans have tried to do to fix this without ever offering their own plan. The American people aren't taking kindly to that. This is like the captain of the Titanic trying to blow holes in the lifeboats so that he can shift the blame to the guy who is trying to save everyone from the captain's mistake.
Similarly, after spending a greater amount than the GDP of all but 14 countries as a stimulus package, Obama has only lost jobs to show for it. How can you spend the Korean economy (which employs around 30 million people) and not produce any jobs? That's an incredible level of incompetence. What's worse, having tried the only thing he knew to do and failed, he now has no idea what to do next.
That is the problem for Obama. He's created an economic disaster on a scale somewhere between Jimmy Carter and the Great Depression and he has no plan to fix this except to play politics with every Republican proposal. That's why his numbers continue to fall and why they won't recover.
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