Democrats are in a bit of a jam on the stimulus, as many reporters have noticed: “Democrats are all over the map on the stimulus and the possibility of a sequel, and it’s not hard to see why: When it comes to a second stimulus, they may be damned if they do and damned if they don’t.” But there is nothing they would have done differently, right? That phrase may prove to be this administration’s “Mission Accomplished” banner.
The current excuse — that somehow the administration didn’t understand how severe the crisis was — isn’t going over so well. In fact, it’s so easily disproved by rolling back the tapes of all the gloom-and-doom talk that permeated the president’s remarks in the early days of his term, that his critics are having a field day. House Minority Leader John Boehner, for example, isn’t buying any excuses:
I found it … interesting over the last couple of days to hear Vice President Biden and the president mention the fact that they didn’t realize how difficult an economic circumstance we were in. . . Now this is the greatest fabrication I have seen since I’ve been in Congress. I’ve sat in meetings in the White House with the vice president and the president. There’s not one person that sat in those rooms that didn’t understand how serious our economic crisis was.
Well he does have a point; the president kept calling it the worst economic crisis since the Great Depression.
The simple truth is the stimulus was ill-conceived and poorly executed. Sooner or later, the president and his advisers will need to acknowledge that deferring to Nancy Pelosi to devise a grab-bag of goodies for liberal interest groups wasn’t smart politics or smart policy.
Thursday, July 9, 2009
In health bill, billions for parks, paths
WASHINGTON - Sweeping healthcare legislation working its way through Congress is more than an effort to provide insurance to millions of Americans without coverage. Tucked within is a provision that could provide billions of dollars for walking paths, streetlights, jungle gyms, and even farmers’ markets.
The add-ons - characterized as part of a broad effort to improve the nation’s health “infrastructure’’ - appear in House and Senate versions of the bill.
Critics argue the provision is a thinly disguised effort to insert pork-barrel spending into a bill that has been widely portrayed to the public as dealing with expanding health coverage and cutting medical costs. A leading critic, Senator Mike Enzi, a Wyoming Republican, ridicules the local projects, asking: “How can Democrats justify the wasteful spending in this bill?’’
But advocates, including Senator Edward M. Kennedy of Massachusetts, defend the proposed spending as a necessary way to promote healthier lives and, in the long run, cut medical costs. “These are not public works grants; they are community transformation grants,’’ said Anthony Coley, a spokesman for Kennedy, chairman of the Senate health committee whose healthcare bill includes the projects.
“If improving the lighting in a playground or clearing a walking path or a bike path or restoring a park are determined as needed by a community to create more opportunities for physical activity, we should not prohibit this from happening,’’ Coley said in a statement.
The Senate health panel’s bill does not specify how much would go to the community projects. A Senate staff member said the amount of spending will be left up to the Obama administration. A House version of the bill caps the projects at $1.6 billion per year and includes them in a section designed to save money in the long run by reducing obesity and other health problems.
It is not clear yet how the money would be allocated. The legislation says that grants will be awarded to local and state government agencies that will have to submit detailed proposals. The final decisions will be made by the secretary of Health and Human Services.
The proposal was inserted at the urging of a nonprofit, nonpartisan group called Trust for America’s Health, which produces reports about obesity and other health matters. Part of the group’s proposed language for the community grants was inserted into the Senate bill. It called for “creating the infrastructure to support active living and access to nutritious foods in a safe environment.’’ The group provided examples of grants for bike paths, jungle gyms, and lighting, though the Senate bill doesn’t list those specifics.
Jeffrey Levi, the group’s executive director, said that “it is easy to satirize’’ the projects, but they are needed to improve America’s health.
We will see a return on this investment if you use this money strategically for proven, evidence-based programs,’’ Levi said in an interview, citing efforts to stop smoking and to promote physical activity. “We will prevent or reverse chronic diseases such as heart disease. . . . It will pay for itself.’’
While many may think the healthcare bill strictly aims to increase coverage, Levi said that is a mistaken impression. “This isn’t just about health insurance,’’ he said. “This bill is about creating a healthier country.’’
The group says that a modest community project can lead directly to improvements in public health. In a recent report, the group cited two examples from Massachusetts that it said were effective: Shape Up Somerville, which helped elementary school children lose weight by promoting physical activity, and the Physical Activity Club in Attleboro, which also helped children lose weight.
The idea of using the healthcare bill as a vehicle for preventing diseases has bipartisan appeal. President Obama has called for “the largest investment ever in preventive care, because that’s one of the best ways to keep our people healthy and our costs under control.’’ Enzi, too, has said that “reducing healthcare costs has to begin with promoting healthier behaviors.’’
But there is disagreement about the best way to do that. Senator Tom Harkin, an Iowa Democrat who is working closely with Kennedy on the healthcare bill, has criticized the current healthcare system for focusing on “sick care’’ and has called for more investment in a variety of measures that would help prevent diseases, including the community grants, restricting junk food in schools, and encouraging children to be more active.
“We spend 75 cents of every healthcare dollar treating people with chronic diseases like diabetes, heart disease, and asthma, and only 4 cents on prevention,’’ Harkin said in a statement. “But the majority of these diseases can be prevented through lifestyle and environmental changes.’’
However, it can be difficult to quantify the benefits of a park or pathway, leading some critics to say such funding is an example how the healthcare legislation has spiraled out of control.
Enzi has said that instead of paying for pathways, it would be more effective to encourage lower insurance premiums for individuals who can prove they have taken steps to improve their health. He said that construction grants belong in other bills.
Enzi, the top Republican on the Senate health committee, has unsuccessfully pushed an amendment that would specifically prohibit the use of funds for sidewalks, streetlights, and other infrastructure projects.
Kennedy spokesman Coley said such proposed amendments are counterproductive, stressing that the projects would be modest and are not intended to replace larger ones that can be funded in other bills. Nonetheless, he said, the projects “may be a very cost-effective and long-lasting intervention.’’
Michael Kranish can be reached by email at kranish@globe.com
The add-ons - characterized as part of a broad effort to improve the nation’s health “infrastructure’’ - appear in House and Senate versions of the bill.
Critics argue the provision is a thinly disguised effort to insert pork-barrel spending into a bill that has been widely portrayed to the public as dealing with expanding health coverage and cutting medical costs. A leading critic, Senator Mike Enzi, a Wyoming Republican, ridicules the local projects, asking: “How can Democrats justify the wasteful spending in this bill?’’
But advocates, including Senator Edward M. Kennedy of Massachusetts, defend the proposed spending as a necessary way to promote healthier lives and, in the long run, cut medical costs. “These are not public works grants; they are community transformation grants,’’ said Anthony Coley, a spokesman for Kennedy, chairman of the Senate health committee whose healthcare bill includes the projects.
“If improving the lighting in a playground or clearing a walking path or a bike path or restoring a park are determined as needed by a community to create more opportunities for physical activity, we should not prohibit this from happening,’’ Coley said in a statement.
The Senate health panel’s bill does not specify how much would go to the community projects. A Senate staff member said the amount of spending will be left up to the Obama administration. A House version of the bill caps the projects at $1.6 billion per year and includes them in a section designed to save money in the long run by reducing obesity and other health problems.
It is not clear yet how the money would be allocated. The legislation says that grants will be awarded to local and state government agencies that will have to submit detailed proposals. The final decisions will be made by the secretary of Health and Human Services.
The proposal was inserted at the urging of a nonprofit, nonpartisan group called Trust for America’s Health, which produces reports about obesity and other health matters. Part of the group’s proposed language for the community grants was inserted into the Senate bill. It called for “creating the infrastructure to support active living and access to nutritious foods in a safe environment.’’ The group provided examples of grants for bike paths, jungle gyms, and lighting, though the Senate bill doesn’t list those specifics.
Jeffrey Levi, the group’s executive director, said that “it is easy to satirize’’ the projects, but they are needed to improve America’s health.
We will see a return on this investment if you use this money strategically for proven, evidence-based programs,’’ Levi said in an interview, citing efforts to stop smoking and to promote physical activity. “We will prevent or reverse chronic diseases such as heart disease. . . . It will pay for itself.’’
While many may think the healthcare bill strictly aims to increase coverage, Levi said that is a mistaken impression. “This isn’t just about health insurance,’’ he said. “This bill is about creating a healthier country.’’
The group says that a modest community project can lead directly to improvements in public health. In a recent report, the group cited two examples from Massachusetts that it said were effective: Shape Up Somerville, which helped elementary school children lose weight by promoting physical activity, and the Physical Activity Club in Attleboro, which also helped children lose weight.
The idea of using the healthcare bill as a vehicle for preventing diseases has bipartisan appeal. President Obama has called for “the largest investment ever in preventive care, because that’s one of the best ways to keep our people healthy and our costs under control.’’ Enzi, too, has said that “reducing healthcare costs has to begin with promoting healthier behaviors.’’
But there is disagreement about the best way to do that. Senator Tom Harkin, an Iowa Democrat who is working closely with Kennedy on the healthcare bill, has criticized the current healthcare system for focusing on “sick care’’ and has called for more investment in a variety of measures that would help prevent diseases, including the community grants, restricting junk food in schools, and encouraging children to be more active.
“We spend 75 cents of every healthcare dollar treating people with chronic diseases like diabetes, heart disease, and asthma, and only 4 cents on prevention,’’ Harkin said in a statement. “But the majority of these diseases can be prevented through lifestyle and environmental changes.’’
However, it can be difficult to quantify the benefits of a park or pathway, leading some critics to say such funding is an example how the healthcare legislation has spiraled out of control.
Enzi has said that instead of paying for pathways, it would be more effective to encourage lower insurance premiums for individuals who can prove they have taken steps to improve their health. He said that construction grants belong in other bills.
Enzi, the top Republican on the Senate health committee, has unsuccessfully pushed an amendment that would specifically prohibit the use of funds for sidewalks, streetlights, and other infrastructure projects.
Kennedy spokesman Coley said such proposed amendments are counterproductive, stressing that the projects would be modest and are not intended to replace larger ones that can be funded in other bills. Nonetheless, he said, the projects “may be a very cost-effective and long-lasting intervention.’’
Michael Kranish can be reached by email at kranish@globe.com
found this on a forum about politics
I recieved this in an email written by Charlie Reese.
EVERY CITIZEN NEEDS TO READ THIS AND THINK ABOUT WHAT THIS JOURNALIST HAS WRITTEN IN THIS MESSAGE. READ IT AND THEN REALLY THINK ABOUT OUR CURRENT POLITICAL DEBACLE.
Charley Reese has been a journalist for 49 years
Politicians are the only people in the world who create problems and then campaign against them.
Have you ever wondered, if both the Democrats and the Republicans are against deficits, WHY do we have deficits?
Have you ever wondered, if all the politicians are against inflation and high taxes, WHY do we have inflation and high taxes?
You and I don't propose a federal budget. The President does.
You and I don't have the Constitutional authority to vote on appropriations. The House of Representatives does.
You and I don't write the tax code, Congress does.
You and I don't set fiscal policy, Congress does.
You and I don't control monetary policy, the Federal Reserve Bank does.
One hundred Senators, 435 Congressmen, one President, and nine Supreme Court justices -- 545 human beings out of the 300 million are directly, legally, morally, and individually responsible for the domestic problems that plague this country.
I excluded the members of the Federal Reserve Board because that problem was created by the Congress. In 1913, Congress delegated its Constitutional duty to provide a sound currency to a federally chartered, but private, central bank.
I excluded all the special interests and lobbyists for a sound reason. They have no legal authority. They have no ability to coerce a senator, a congressman, or a President to do one cotton-picking thing. I don't care if they offer a politician $1 million dollars in cash. The politician has the power to accept or reject it. No matter what the lobbyist promises, it is the legislator's responsibility to determine how he votes.
Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common con regardless of party. What separates a politician from a normal human being is an excessive amount of gall. No normal human being would have the gall of a Speaker, who stood up and criticized the President for creating deficits. The president can only propose a budget. He cannot force the Congress to accept it.
The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating and approving appropriations and taxes.
Who is the speaker of the House? Nancy Pelosi. She is the leader of the majority party. She and fellow House members, not the President, can approve any budget they want. If the President vetoes it, they can pass it over his veto if they agree to.
It seems inconceivable to me that a nation of 300 million can not replace 545 people who stand convicted -- by present facts -- of incompetence and irresponsibility. I can't think of a single domestic problem that is not traceable directly to those 545 people. When you fully grasp the plain truth that 545 people exercise the power of the federal government, then it must follow that what exists is what they want to exist.
If the tax code is unfair, it's because they want it unfair.
If the budget is in the red, it's because they want it in the red ..
If the Army & Marines are in IRAQ, it's because they want them in IRAQ .
If they do not receive Social Security but are on an elite retirement plan not available to the people, it's because they want it that way.
There are no insoluble government problems.
Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take this power..
Above all, do not let them con you into the belief that there exists disembodied mystical forces like "the economy," "inflation," or "politics" that prevent them from doing what they take an oath to do.
Those 545 people, and they alone, are responsible.
They, and they alone, have the power.
They, and they alone, should be held accountable by the people who are their bosses.
Provided the voters have the gumption to manage their own employees.
We should vote all of them out of office and clean up their mess!
Charlie Reese is a former columnist of the Orlando Sentinel Newspaper.
What you do with this article now that you have read it is up to you, though you have several choices:
1. You can send this to everyone in your address book and hope "they" do something about it.
2. You can agree to "vote against" everyone that is currently in office, knowing that the process will take several years.
3. You can decide to "run for office" yourself and agree to do the job properly.
4. Lastly, you can sit back and do nothing or re-elect the current bunch.
Institute TERM LIMITS!!!
The Republicans and the Dems simply want us to hate each other.....divide and conquer if we elect people who follow the constitution we will all be better off, we can then have real change that will benifit the poorest as well as the middle class, and the rich will not be overburdened.
EVERY CITIZEN NEEDS TO READ THIS AND THINK ABOUT WHAT THIS JOURNALIST HAS WRITTEN IN THIS MESSAGE. READ IT AND THEN REALLY THINK ABOUT OUR CURRENT POLITICAL DEBACLE.
Charley Reese has been a journalist for 49 years
Politicians are the only people in the world who create problems and then campaign against them.
Have you ever wondered, if both the Democrats and the Republicans are against deficits, WHY do we have deficits?
Have you ever wondered, if all the politicians are against inflation and high taxes, WHY do we have inflation and high taxes?
You and I don't propose a federal budget. The President does.
You and I don't have the Constitutional authority to vote on appropriations. The House of Representatives does.
You and I don't write the tax code, Congress does.
You and I don't set fiscal policy, Congress does.
You and I don't control monetary policy, the Federal Reserve Bank does.
One hundred Senators, 435 Congressmen, one President, and nine Supreme Court justices -- 545 human beings out of the 300 million are directly, legally, morally, and individually responsible for the domestic problems that plague this country.
I excluded the members of the Federal Reserve Board because that problem was created by the Congress. In 1913, Congress delegated its Constitutional duty to provide a sound currency to a federally chartered, but private, central bank.
I excluded all the special interests and lobbyists for a sound reason. They have no legal authority. They have no ability to coerce a senator, a congressman, or a President to do one cotton-picking thing. I don't care if they offer a politician $1 million dollars in cash. The politician has the power to accept or reject it. No matter what the lobbyist promises, it is the legislator's responsibility to determine how he votes.
Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common con regardless of party. What separates a politician from a normal human being is an excessive amount of gall. No normal human being would have the gall of a Speaker, who stood up and criticized the President for creating deficits. The president can only propose a budget. He cannot force the Congress to accept it.
The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating and approving appropriations and taxes.
Who is the speaker of the House? Nancy Pelosi. She is the leader of the majority party. She and fellow House members, not the President, can approve any budget they want. If the President vetoes it, they can pass it over his veto if they agree to.
It seems inconceivable to me that a nation of 300 million can not replace 545 people who stand convicted -- by present facts -- of incompetence and irresponsibility. I can't think of a single domestic problem that is not traceable directly to those 545 people. When you fully grasp the plain truth that 545 people exercise the power of the federal government, then it must follow that what exists is what they want to exist.
If the tax code is unfair, it's because they want it unfair.
If the budget is in the red, it's because they want it in the red ..
If the Army & Marines are in IRAQ, it's because they want them in IRAQ .
If they do not receive Social Security but are on an elite retirement plan not available to the people, it's because they want it that way.
There are no insoluble government problems.
Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take this power..
Above all, do not let them con you into the belief that there exists disembodied mystical forces like "the economy," "inflation," or "politics" that prevent them from doing what they take an oath to do.
Those 545 people, and they alone, are responsible.
They, and they alone, have the power.
They, and they alone, should be held accountable by the people who are their bosses.
Provided the voters have the gumption to manage their own employees.
We should vote all of them out of office and clean up their mess!
Charlie Reese is a former columnist of the Orlando Sentinel Newspaper.
What you do with this article now that you have read it is up to you, though you have several choices:
1. You can send this to everyone in your address book and hope "they" do something about it.
2. You can agree to "vote against" everyone that is currently in office, knowing that the process will take several years.
3. You can decide to "run for office" yourself and agree to do the job properly.
4. Lastly, you can sit back and do nothing or re-elect the current bunch.
Institute TERM LIMITS!!!
The Republicans and the Dems simply want us to hate each other.....divide and conquer if we elect people who follow the constitution we will all be better off, we can then have real change that will benifit the poorest as well as the middle class, and the rich will not be overburdened.
Wednesday, July 8, 2009
The Burdern of Taxes and Other Congressional Lies by Walter Williams (November 14, 2007)
An important component of the leftist class warfare agenda is to condemn President Bush's tax cuts for the rich. This claim is careless, ignorant or dishonest on at least two counts. First there's the constitutional issue. Article I, Section 8 reads, "The Congress shall have Power To lay and collect Taxes . . ." That means the president has no taxing authority.
Presidents can propose or veto taxes and Congress can override vetoes. The bottom line is that all taxing authority rests with the U.S. Congress. The next time you hear someone condemn or praise Bush's tax cuts, ask them whether the Constitution has been amended to give the president taxing authority.
But what about those tax cuts for the rich? Are the rich now sharing a smaller burden of the federal income tax because their fair share of the burden has been shifted to the poor? The most recent Internal Revenue Service (IRS) statistics can give us some guidance. In 2005, the top 1 percent of income earners, those with an annual adjusted gross income of $365,000 and higher, paid 39 percent of all federal income taxes; in 1999, they paid 36 percent.
In 2005, the top 5 percent of income earners, those having an adjusted gross income of $145,000 and higher, paid 60 percent of all federal taxes; in 1999, it was 55 percent. The top 10 percent, earning income over $103,000, paid 70 percent. The top 25 percent, with income of over $62,000, paid 86 percent, and the top 50 percent, earning $31,000 and higher, paid 97 percent of all federal taxes.
What about any argument suggesting that the burden of taxes have been shifted to the poor? The bottom 50 percent, earning $30,000 or less, paid 3 percent of total federal income taxes. In 1999, they paid 4 percent. Congressmen know all of this, but they attempt to hoodwink the average American who doesn't.
The fact that there are so many American earners who have little or no financial stake in our country poses a serious political problem. The Tax Foundation estimates that 41 percent of whites, 56 percent of blacks, 59 percent of American Indian and Aleut Eskimo and 40 percent Asian and Pacific Islanders had no 2004 federal income tax liability. The study concluded, "When all of the dependents of these income-producing households are counted, there are roughly 122 million Americans -- 44 percent of the U.S. population -- who are outside of the federal income tax system." These people represent a natural constituency for big-spending politicians. In other words, if you have little or no financial stake in America, what do you care about the cost of massive federal spending programs?
Similarly, what do you care about tax cuts if you're paying little or no taxes? In fact, you might be openly hostile toward tax cuts out of fear that they might lead to reductions in handout programs from which you benefit. Survey polls have confirmed this. According to The Harris Poll taken in June 2003, 51 percent of Democrats thought the tax cuts enacted by Congress were a bad thing while 16 percent of Republicans thought so. Among Democrats, 67 percent thought the tax cuts were unfair while 32 percent of Republicans thought so. When asked whether the $350 billion tax cut package will help your family finances, 59 percent of those surveyed said no and 35 percent said yes.
Whether you're for or against President Bush matters little, but what do you think of politicians and their media dupes winning you over with lies about the rich not paying their fair share? And, by the way, $145,000 or even $345,000 a year hardly qualifies one as rich. It's not even yacht money.
Presidents can propose or veto taxes and Congress can override vetoes. The bottom line is that all taxing authority rests with the U.S. Congress. The next time you hear someone condemn or praise Bush's tax cuts, ask them whether the Constitution has been amended to give the president taxing authority.
But what about those tax cuts for the rich? Are the rich now sharing a smaller burden of the federal income tax because their fair share of the burden has been shifted to the poor? The most recent Internal Revenue Service (IRS) statistics can give us some guidance. In 2005, the top 1 percent of income earners, those with an annual adjusted gross income of $365,000 and higher, paid 39 percent of all federal income taxes; in 1999, they paid 36 percent.
In 2005, the top 5 percent of income earners, those having an adjusted gross income of $145,000 and higher, paid 60 percent of all federal taxes; in 1999, it was 55 percent. The top 10 percent, earning income over $103,000, paid 70 percent. The top 25 percent, with income of over $62,000, paid 86 percent, and the top 50 percent, earning $31,000 and higher, paid 97 percent of all federal taxes.
What about any argument suggesting that the burden of taxes have been shifted to the poor? The bottom 50 percent, earning $30,000 or less, paid 3 percent of total federal income taxes. In 1999, they paid 4 percent. Congressmen know all of this, but they attempt to hoodwink the average American who doesn't.
The fact that there are so many American earners who have little or no financial stake in our country poses a serious political problem. The Tax Foundation estimates that 41 percent of whites, 56 percent of blacks, 59 percent of American Indian and Aleut Eskimo and 40 percent Asian and Pacific Islanders had no 2004 federal income tax liability. The study concluded, "When all of the dependents of these income-producing households are counted, there are roughly 122 million Americans -- 44 percent of the U.S. population -- who are outside of the federal income tax system." These people represent a natural constituency for big-spending politicians. In other words, if you have little or no financial stake in America, what do you care about the cost of massive federal spending programs?
Similarly, what do you care about tax cuts if you're paying little or no taxes? In fact, you might be openly hostile toward tax cuts out of fear that they might lead to reductions in handout programs from which you benefit. Survey polls have confirmed this. According to The Harris Poll taken in June 2003, 51 percent of Democrats thought the tax cuts enacted by Congress were a bad thing while 16 percent of Republicans thought so. Among Democrats, 67 percent thought the tax cuts were unfair while 32 percent of Republicans thought so. When asked whether the $350 billion tax cut package will help your family finances, 59 percent of those surveyed said no and 35 percent said yes.
Whether you're for or against President Bush matters little, but what do you think of politicians and their media dupes winning you over with lies about the rich not paying their fair share? And, by the way, $145,000 or even $345,000 a year hardly qualifies one as rich. It's not even yacht money.
Government Deception About Government Finances by Walter Williams (April 8, 2009)
Most Americans accept the continuing attack on tobacco companies and smokers, but how do they feel about the massive government deception? In 1998, 46 state attorneys general and major tobacco companies signed the Master Settlement Agreement. The major tobacco companies agreed, among other things, to give states $240 billion over 25 years to provide for smoking cessation programs and cover the health costs associated with using their product. In return state attorneys general promised tobacco companies that they wouldn't sue them and would use their lawmaking power to protect the major tobacco companies from competition from small tobacco companies. Of the $80 billion extorted so far, states have spent about 30 percent on health, not all tobacco-related, and less than 6 percent on smoking cessation programs. Instead, state legislatures spent the bulk of their tobacco money for items such as museum building, tax relief, rainy-day funds and other expenditures having nothing to do with tobacco or health.
The U.S. Congress' deception was, and continues to be, a major player in our financial meltdown. In congressional hearings, before the meltdown, on the soundness of Fannie Mae and Freddie Mac, Rep. Maxine Waters said, "Through nearly a dozen hearings, we were frankly trying to fix something that wasn't broke. Mr. Chairman, we do not have a crisis at Freddie Mac, and particularly at Fannie Mae, under the outstanding leadership of Franklin Raines." Rep. Barney Frank, the ranking Democrat on the Financial Services Committee, said, "These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis. The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." Other congressmen gave similar assurances. Unfortunately for our nation, the forces pushing for "affordable" housing won the day and saddled us with today's unprecedented financial disaster. How stupid is it of us to ask those who brought us "affordable" housing to now turn their attention to bringing us "affordable" health care?
Congressional deception about government finances means today's children will face a financial disaster that will make today's mess seem like a walk in the park. What's called the public debt stands at $11 trillion and growing. That pales in comparison to the federal government's unfunded liability -- obligations that are not covered by an asset of equal or greater value.
Mike Whalen, former policy chairman of the Dallas-based National Center for Policy Analysis, commenting on last year's Social Security Trustees annual report on the state of the Social Security and Medicare programs, said, "The report on the state of entitlement programs is rather grim -- the combined unfunded liabilities of both programs are $101 trillion." What that means is that in order for government to make good on its promises, Congress would have to put aside tens of trillions of dollars in the bank today. Keep in mind that our GDP is only $14 trillion.
In the absence of massive tax increases or cuts in benefits, in order to meet its promises Congress must cease spending on one in four programs by 2020, such as education and highway construction, and one in two by 2030, and by 2050 or so all federal revenue will be spent supporting Social Security, Medicare and prescription drug benefits. Such a scenario is unsustainable. There will be economic and political chaos. Today's politicians are not likely to take measures to avoid the coming chaos because senior citizens, the major beneficiaries of Social Security and Medicare, vote in large numbers and will exact a high political price. Plus, neither today's senior citizens nor today's politicians will be alive in 2050. I'd be more optimistic if my fellow Americans were simply suffering from congressional deception as opposed to their not caring about the economic calamity that awaits tomorrow's Americans. I'd be even more optimistic if today's seniors started putting heat on Congress to allow those Americans who want nothing to do with Social Security to opt out.
The U.S. Congress' deception was, and continues to be, a major player in our financial meltdown. In congressional hearings, before the meltdown, on the soundness of Fannie Mae and Freddie Mac, Rep. Maxine Waters said, "Through nearly a dozen hearings, we were frankly trying to fix something that wasn't broke. Mr. Chairman, we do not have a crisis at Freddie Mac, and particularly at Fannie Mae, under the outstanding leadership of Franklin Raines." Rep. Barney Frank, the ranking Democrat on the Financial Services Committee, said, "These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis. The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." Other congressmen gave similar assurances. Unfortunately for our nation, the forces pushing for "affordable" housing won the day and saddled us with today's unprecedented financial disaster. How stupid is it of us to ask those who brought us "affordable" housing to now turn their attention to bringing us "affordable" health care?
Congressional deception about government finances means today's children will face a financial disaster that will make today's mess seem like a walk in the park. What's called the public debt stands at $11 trillion and growing. That pales in comparison to the federal government's unfunded liability -- obligations that are not covered by an asset of equal or greater value.
Mike Whalen, former policy chairman of the Dallas-based National Center for Policy Analysis, commenting on last year's Social Security Trustees annual report on the state of the Social Security and Medicare programs, said, "The report on the state of entitlement programs is rather grim -- the combined unfunded liabilities of both programs are $101 trillion." What that means is that in order for government to make good on its promises, Congress would have to put aside tens of trillions of dollars in the bank today. Keep in mind that our GDP is only $14 trillion.
In the absence of massive tax increases or cuts in benefits, in order to meet its promises Congress must cease spending on one in four programs by 2020, such as education and highway construction, and one in two by 2030, and by 2050 or so all federal revenue will be spent supporting Social Security, Medicare and prescription drug benefits. Such a scenario is unsustainable. There will be economic and political chaos. Today's politicians are not likely to take measures to avoid the coming chaos because senior citizens, the major beneficiaries of Social Security and Medicare, vote in large numbers and will exact a high political price. Plus, neither today's senior citizens nor today's politicians will be alive in 2050. I'd be more optimistic if my fellow Americans were simply suffering from congressional deception as opposed to their not caring about the economic calamity that awaits tomorrow's Americans. I'd be even more optimistic if today's seniors started putting heat on Congress to allow those Americans who want nothing to do with Social Security to opt out.
Taxes and Prosperity Lost by Walter Williams (April 13, 2009)
Ask the average person which is the correct answer to the following question: Which president gave the biggest tax cuts for the rich -- Reagan or Bush?
I would bet the rent money that you would not get the correct response, which is: Presidents have no taxing authority. Article I, Section 8 of the U.S. Constitution says: "The Congress shall have power to lay and collect taxes, duties, imposts and excises." I know that many politicians and news media people read my column. How do we characterize them if they continue to speak of presidents cutting or raising taxes?
Another tax question: If there's an imposition of a property tax on your land, who pays the tax? I guarantee you that land does not pay taxes; only people pay taxes. That means a tax on your land is a tax on you. You say, "Williams, that's pretty elementary, isn't it?" But what do you say to a politician or news media people who propose increasing corporate taxes as means to get rich corporations to pay their rightful share of government? They should be told that they speak nonsense because corporations, like land, do not pay taxes; only people pay taxes.
If a tax is levied on a corporation, and if it is to survive, it must raise the price of its product, or lower dividends or lay off workers. In each case, it is people, not some legal fiction called a corporation, who bear the burden of any tax levied on the corporation. An important subject area in economics called tax incidence says that the entity upon whom a tax is levied does not necessarily bear the burden of the tax. Some of the tax burden can be shifted to another party. That's precisely what corporations do and as such they are merely government tax collectors.
Here's another tax question: Which worker receives the higher pay: a worker on a road construction project moving dirt with a shovel or a worker moving dirt atop a giant earthmover? If you said the guy on the earthmover, go to the head of the class. But why? It's not because he's unionized or that employers just love earthmover operators. It's because having more capital (tools) makes him more productive and therefore earn higher wages.
It's not rocket science to conclude that whatever lowers the cost of capital formation enables workers to have more capital to work with and enjoy higher wages. Policies that raise the cost of capital formation such as capital gains taxes, low depreciation allowances and high corporate income taxes, and thereby reducing capital formation, serves neither the interests of workers, investors nor consumers.
Taxes also reduce transactions. I need my computer repaired. You and I agree that the job is worth $200. Suppose there's the imposition of a 30 percent income tax on you. That means you would net only $140 and might refuse the job. You might suggest that if I were willing to pay you $285 you would do the job because at that price your after-tax earnings will be $200 -- what doing the job is worth to you. There's a problem. The repair job was worth $200 to me, not $285. So it's my turn to say the heck with it, or would we and society be better off if you and I agreed to the repair job but did not tell anybody? I'd say yes, but we'd be criminals.
You might wonder how congressmen can get away with taxes and other measures that reduce our prosperity potential. Part of the answer is the anti-business climate promoted in academia and the news media. The more important reason is that prosperity foregone is invisible. In other words, we can never tell how much richer we would have been without today's level of congressional interference in our lives and therefore don't fight it as much as we should.
I would bet the rent money that you would not get the correct response, which is: Presidents have no taxing authority. Article I, Section 8 of the U.S. Constitution says: "The Congress shall have power to lay and collect taxes, duties, imposts and excises." I know that many politicians and news media people read my column. How do we characterize them if they continue to speak of presidents cutting or raising taxes?
Another tax question: If there's an imposition of a property tax on your land, who pays the tax? I guarantee you that land does not pay taxes; only people pay taxes. That means a tax on your land is a tax on you. You say, "Williams, that's pretty elementary, isn't it?" But what do you say to a politician or news media people who propose increasing corporate taxes as means to get rich corporations to pay their rightful share of government? They should be told that they speak nonsense because corporations, like land, do not pay taxes; only people pay taxes.
If a tax is levied on a corporation, and if it is to survive, it must raise the price of its product, or lower dividends or lay off workers. In each case, it is people, not some legal fiction called a corporation, who bear the burden of any tax levied on the corporation. An important subject area in economics called tax incidence says that the entity upon whom a tax is levied does not necessarily bear the burden of the tax. Some of the tax burden can be shifted to another party. That's precisely what corporations do and as such they are merely government tax collectors.
Here's another tax question: Which worker receives the higher pay: a worker on a road construction project moving dirt with a shovel or a worker moving dirt atop a giant earthmover? If you said the guy on the earthmover, go to the head of the class. But why? It's not because he's unionized or that employers just love earthmover operators. It's because having more capital (tools) makes him more productive and therefore earn higher wages.
It's not rocket science to conclude that whatever lowers the cost of capital formation enables workers to have more capital to work with and enjoy higher wages. Policies that raise the cost of capital formation such as capital gains taxes, low depreciation allowances and high corporate income taxes, and thereby reducing capital formation, serves neither the interests of workers, investors nor consumers.
Taxes also reduce transactions. I need my computer repaired. You and I agree that the job is worth $200. Suppose there's the imposition of a 30 percent income tax on you. That means you would net only $140 and might refuse the job. You might suggest that if I were willing to pay you $285 you would do the job because at that price your after-tax earnings will be $200 -- what doing the job is worth to you. There's a problem. The repair job was worth $200 to me, not $285. So it's my turn to say the heck with it, or would we and society be better off if you and I agreed to the repair job but did not tell anybody? I'd say yes, but we'd be criminals.
You might wonder how congressmen can get away with taxes and other measures that reduce our prosperity potential. Part of the answer is the anti-business climate promoted in academia and the news media. The more important reason is that prosperity foregone is invisible. In other words, we can never tell how much richer we would have been without today's level of congressional interference in our lives and therefore don't fight it as much as we should.
Taxation 101: Who Pays Corporate Taxes? by Walter Williams (April 14, 2009)
When we think about government spending, and the taxes needed to finance its spending, we should also think of the effects of taxation.
Suppose I hire you to repair my computer. The job is worth $200 to me and doing the job is worth $200 to you. The transaction will occur because we have a meeting of the mind. Now suppose there's the imposition of a 30 percent income tax on you. That means you won't receive $200 but instead $140. You might say the heck with working for me -- spending the day with your family is worth more than $140.
You might then offer that you'll do the job if I pay you $285. That way your after-tax earnings will be $200 -- what the job was worth to you. There's a problem. The repair job was worth $200 to me, not $285. So it's my turn to say the heck with it.
This simple example demonstrates that one effect of taxes is that of eliminating transactions, and hence jobs. But politicians have what we economists call a zero elasticity vision of the world. They think people will behave after taxes just as they behaved before taxes and the only effect of a tax is to bring in more revenue. Here's a question for you: Would we and society be better off if you and I agreed to the repair job but did not tell anybody? I'd say yes, but we'd be criminals.
Here's another tax question: Which worker receives the higher pay on a road construction project: a worker moving dirt with a shovel or a worker moving dirt atop a giant earthmover? If you said the guy on the earthmover, go to the head of the class.
But why? It's not because he's unionized or that employers just love earthmover operators. It's because he's more productive and the reason is that he has more capital (tools) with which to work. In general, the more capital workers have to work with, the higher their pay.
So what's a good policy for higher wages? One is to keep the cost of capital formation low so companies will do more of it. Policies that raise the cost of capital formation and lower risk-taking are high corporate income taxes, low allowances for depreciation and capital gains taxes. Those who want to see higher productivity gains and higher wages, of which I'm one, should champion tax reductions.
How in the world can tobacco companies survive and remain profitable in the wake of punitive taxes, penalties and court settlements? If the government and the courts imposed these multibillion dollar sanctions on the beef industry, it would have been long gone. The answer's easy. Corporations do not pay taxes, penalties and settlements.
A subject area in economics, called the incidence of taxation, says that the party upon whom a tax is levied does not necessarily pay the tax. They might shift it onto some other party. That's precisely what corporations do. They are merely tax collectors.
In the case of tobacco, the punitive taxes, penalties and settlements are shifted forward to consumers in the form of higher prices -- thus, government has punished smokers much more than tobacco companies.
If the government made a similar attack on the beef industry, it would be out of business. Why? There are many substitutes for beef that consumers would turn to, whereas there're few substitutes for tobacco. Imposition of oppressive taxes on goods having few substitutes is standard fare for government. King George III did it with what our ancestors called the Intolerable Acts (Stamp Tax, Tea Tax and others). But not for long. Americans of that day hadn't learned the lessons of submissiveness and compliance -- they rebelled.
Suppose I hire you to repair my computer. The job is worth $200 to me and doing the job is worth $200 to you. The transaction will occur because we have a meeting of the mind. Now suppose there's the imposition of a 30 percent income tax on you. That means you won't receive $200 but instead $140. You might say the heck with working for me -- spending the day with your family is worth more than $140.
You might then offer that you'll do the job if I pay you $285. That way your after-tax earnings will be $200 -- what the job was worth to you. There's a problem. The repair job was worth $200 to me, not $285. So it's my turn to say the heck with it.
This simple example demonstrates that one effect of taxes is that of eliminating transactions, and hence jobs. But politicians have what we economists call a zero elasticity vision of the world. They think people will behave after taxes just as they behaved before taxes and the only effect of a tax is to bring in more revenue. Here's a question for you: Would we and society be better off if you and I agreed to the repair job but did not tell anybody? I'd say yes, but we'd be criminals.
Here's another tax question: Which worker receives the higher pay on a road construction project: a worker moving dirt with a shovel or a worker moving dirt atop a giant earthmover? If you said the guy on the earthmover, go to the head of the class.
But why? It's not because he's unionized or that employers just love earthmover operators. It's because he's more productive and the reason is that he has more capital (tools) with which to work. In general, the more capital workers have to work with, the higher their pay.
So what's a good policy for higher wages? One is to keep the cost of capital formation low so companies will do more of it. Policies that raise the cost of capital formation and lower risk-taking are high corporate income taxes, low allowances for depreciation and capital gains taxes. Those who want to see higher productivity gains and higher wages, of which I'm one, should champion tax reductions.
How in the world can tobacco companies survive and remain profitable in the wake of punitive taxes, penalties and court settlements? If the government and the courts imposed these multibillion dollar sanctions on the beef industry, it would have been long gone. The answer's easy. Corporations do not pay taxes, penalties and settlements.
A subject area in economics, called the incidence of taxation, says that the party upon whom a tax is levied does not necessarily pay the tax. They might shift it onto some other party. That's precisely what corporations do. They are merely tax collectors.
In the case of tobacco, the punitive taxes, penalties and settlements are shifted forward to consumers in the form of higher prices -- thus, government has punished smokers much more than tobacco companies.
If the government made a similar attack on the beef industry, it would be out of business. Why? There are many substitutes for beef that consumers would turn to, whereas there're few substitutes for tobacco. Imposition of oppressive taxes on goods having few substitutes is standard fare for government. King George III did it with what our ancestors called the Intolerable Acts (Stamp Tax, Tea Tax and others). But not for long. Americans of that day hadn't learned the lessons of submissiveness and compliance -- they rebelled.
Senate Slavery Apology by Walter Williams (July 8, 2009)
Last month, the U.S. Senate unanimously passed Senate Resolution 26 "Apologizing for the enslavement and racial segregation of African-Americans." The resolution ends with: "Disclaimer. -- Nothing in this resolution (a) authorizes or supports any claim against the United States; or (b) serves as a settlement of any claim against the United States." That means Congress apologizes but is not going to pay reparations, as least for now.
Members of the Congressional Black Caucus have expressed concerns about the disclaimer, thinking that it's an attempt to stave off reparations claims from the descendants of slaves. Congressional Black Caucus Chairwoman Barbara Lee, D-Calif., said her organization is studying the language of the resolution and Rep. Bennie Thompson, D-Miss, said "putting in a disclaimer takes away from the meaning of an apology. A number of us are prepared to vote against it in its present form. There are several members of the Progressive Caucus who feel the same way."
It goes without saying that slavery was a gross violation of human rights. Justice would demand that all the perpetrators -- that includes slave owners, and African and Arab slave sellers -- make compensatory reparation payments to victims. Since slaves, slave owners and slave sellers are no longer with us, such compensation is beyond our reach and a matter to be settled in the world beyond.
Absent from the reparations debate is: Who pays? Don't say the government because the government doesn't have any money that it doesn't first take from some American. So which Americans owe black people what?
Reparations advocates don't want that question asked but let's you and I.
Are the millions of Europeans, Asians, and Latin Americans who immigrated to the U.S. in the 20th century responsible for slavery and should they be forced to cough up reparations money? What about descendants of Northern whites who fought and died in the name of freeing slaves? Should they cough up reparations money for black Americans? What about non-slave-owning Southern whites, a majority of whites; should they be made to pay reparations? And, by the way, would President Obama, whose father is Kenyan and mother white, be eligible for a reparations payment?
On black people's side of the ledger, thorny issues also arise.
Some blacks purchased other blacks as a means to free family members. But other blacks owned slaves for the same reason whites owned slaves -- to work farms or plantations. Are descendants of these blacks eligible and deserving of reparations? There is no way that Europeans could have captured millions of Africans. They had African and Arab help. Should Congress haul representatives of Ghana, Ivory Coast, Nigeria and Muslim states before them and demand they compensate American blacks because of their ancestors' involvement in capturing and selling slaves?
Reparations advocates make the foolish unchallenged pronouncement that United States became rich on the backs of free black labor. That's utter nonsense. Slavery has never had a very good record of producing wealth. Think about it. Slavery was all over the South. Buying into the reparations nonsense, you'd have to conclude that the antebellum South was rich and the slave-starved North was poor. The truth of the matter is just the opposite. In fact, the poorest states and regions of our country were places where slavery flourished: Mississippi, Alabama, and Georgia while the richest states and regions were those where slavery was absent: Pennsylvania, New York and Massachusetts.
The Senate apology is nothing more than political theater but it could be a slick way to get the camel's nose into the tent for future reparations. If the senators are motivated by white guilt, I have the cure.
About 15 years ago I wrote a "Proclamation of Amnesty and Pardon Granted to All Persons of European Descent" that is available at: www.gmu.edu/departments/economics/wew/gift.html
Born in Philadelphia in 1936, Walter E. Williams holds a bachelor's degree in economics from California State University (1965) and a master's degree (1967) and doctorate (1972) in economics from the University of California at Los Angeles.
Members of the Congressional Black Caucus have expressed concerns about the disclaimer, thinking that it's an attempt to stave off reparations claims from the descendants of slaves. Congressional Black Caucus Chairwoman Barbara Lee, D-Calif., said her organization is studying the language of the resolution and Rep. Bennie Thompson, D-Miss, said "putting in a disclaimer takes away from the meaning of an apology. A number of us are prepared to vote against it in its present form. There are several members of the Progressive Caucus who feel the same way."
It goes without saying that slavery was a gross violation of human rights. Justice would demand that all the perpetrators -- that includes slave owners, and African and Arab slave sellers -- make compensatory reparation payments to victims. Since slaves, slave owners and slave sellers are no longer with us, such compensation is beyond our reach and a matter to be settled in the world beyond.
Absent from the reparations debate is: Who pays? Don't say the government because the government doesn't have any money that it doesn't first take from some American. So which Americans owe black people what?
Reparations advocates don't want that question asked but let's you and I.
Are the millions of Europeans, Asians, and Latin Americans who immigrated to the U.S. in the 20th century responsible for slavery and should they be forced to cough up reparations money? What about descendants of Northern whites who fought and died in the name of freeing slaves? Should they cough up reparations money for black Americans? What about non-slave-owning Southern whites, a majority of whites; should they be made to pay reparations? And, by the way, would President Obama, whose father is Kenyan and mother white, be eligible for a reparations payment?
On black people's side of the ledger, thorny issues also arise.
Some blacks purchased other blacks as a means to free family members. But other blacks owned slaves for the same reason whites owned slaves -- to work farms or plantations. Are descendants of these blacks eligible and deserving of reparations? There is no way that Europeans could have captured millions of Africans. They had African and Arab help. Should Congress haul representatives of Ghana, Ivory Coast, Nigeria and Muslim states before them and demand they compensate American blacks because of their ancestors' involvement in capturing and selling slaves?
Reparations advocates make the foolish unchallenged pronouncement that United States became rich on the backs of free black labor. That's utter nonsense. Slavery has never had a very good record of producing wealth. Think about it. Slavery was all over the South. Buying into the reparations nonsense, you'd have to conclude that the antebellum South was rich and the slave-starved North was poor. The truth of the matter is just the opposite. In fact, the poorest states and regions of our country were places where slavery flourished: Mississippi, Alabama, and Georgia while the richest states and regions were those where slavery was absent: Pennsylvania, New York and Massachusetts.
The Senate apology is nothing more than political theater but it could be a slick way to get the camel's nose into the tent for future reparations. If the senators are motivated by white guilt, I have the cure.
About 15 years ago I wrote a "Proclamation of Amnesty and Pardon Granted to All Persons of European Descent" that is available at: www.gmu.edu/departments/economics/wew/gift.html
Born in Philadelphia in 1936, Walter E. Williams holds a bachelor's degree in economics from California State University (1965) and a master's degree (1967) and doctorate (1972) in economics from the University of California at Los Angeles.
California Screaming
The Golden State's political class comes unglued in the face of a citizens' revolt.
Matt Welch | August/September 2009 Print Edition
A very good piece on how California is a smaller version of the U.S. The people are revolting.
On May 19, California voters went to the polls to decide whether to pass a package of six tax-and-gimmick ballot propositions. Its supporters—Republican Gov. Arnold Schwarzenegger, Democratic legislative leaders, the California Teachers Association, and the overwhelming majority of the state’s major newspapers—billed it as the last best hope to plug Sacramento’s $24 billion budget deficit. “Either pass it,” warned the Los Angeles Times editorial board, “or risk fiscal disaster.”
Those who believe that either money or the media determine political outcomes should pay close heed to what happened next: Although opponents were outspent by more than 7 to 1, they trounced the state’s political class, rejecting five of the six measures by an average of 30 percentage points. The only proposition to pass was an anger-driven new law that limits elected officials’ salaries.
Faced with such thorough repudiation, California’s best and brightest then did a telling thing. They lashed right back.
The Los Angeles Times headlined its morning-after news analysis, “California Voters Exercise Their Power—and That’s the Problem.” Sacramento columnist George Skelton argued that “voters helped get themselves into this fix” by “passing feel-good ‘ballot box budgeting’ initiatives” and sanctioning “heavy borrowing” for “infrastructure projects.” Business columnist Michael Hiltzik averred that “far more blame for the deficit belongs to California voters” because “year in, year out, they enact spending mandates at the polls, often without endowing a revenue source.” Missing from any of these critiques was the fact that the Times’ own editorial board endorsed more than 90 percent of the very same ballot-box bond measures during the last decade. No matter: A perpetrator had been located.
“Good morning, California voters,” The Sacramento Bee’s post-election editorial began. “Do you feel better, now that you’ve gotten that out of your system?” The Bee, which (like the Times) had endorsed four of the five losing measures, came under immediate attack for its heavy-handed, citizen-blaming sarcasm. (A sample: “So, now that you’ve put those irksome politicians in their place, maybe it’s time to think about this: Since you’re in charge, exactly what do you intend to do about that pesky $25 billion hole in the budget?”) Rush Limbaugh gleefully read passages on his show, San Diego Union-Tribune editorial writer Chris Reed called it “staggeringly juvenile, arrogant and revealing,” and commenters on the Bee’s website were full of reactions like, “What an obnoxious editorial. Nevertheless, it illustrates that the Bee is completely in favor of bigger government and higher taxes.”
Then another funny thing happened: The Bee scrubbed the editorial off its website, replacing it with a much more conciliatory piece, addressed this time to legislators. The original editorial had been posted in “error,” the paper explained, and the new piece was the one that appeared in the print edition. “That [first] article was a draft prepared for internal discussion among members of The Bee’s editorial board,” a brief note said. “Such discussions are a routine part of our work, and frequently lead to editorials that are considerably different from writers’ first drafts.”
This instant airbrushing, normally fodder for such journalism-tracking websites as Jim Romenesko’s Media News, went virtually ignored by all but a few mostly right-leaning websites. So did another colossal gaffe, by the aforementioned Los Angeles Times columnist Michael Hiltzik, who thundered that the very notion California had a “spending problem” was an “infectious myth.”
Hiltzik claimed that the state government’s budget growth had kept pace “almost to the penny” with growth in population and inflation during the last decade. There were three problems with this analysis: Hiltzik miscalculated population growth (claiming 30 percent instead of 14 percent), he chose a federal inflation rate of 50 percent during that period instead of the California Consumer Price Index figure of 35 percent, and, most important, he excluded from state spending more than $100 billion in bond measures. This whopper was roasted and dissected on local talk radio, but it was unmentioned by more august repositories of public policy and journalism debate, such as the Times-tracking LA Observed.
Rarely has the chasm between elite political discourse and grubby popular opinion been displayed in such sharp relief. The implications of this citizen revolt—and the hostile reactions to it—stretch far beyond Nevada’s western border. California is the Ghost of Federal Government Future.
During the last two decades, the Golden State has been transformed from what was once known as the nation’s most anti-labor outpost to a state essentially run by public-sector unions. Nearly three in five publicsector workers are unionized, compared to less than two in five public employees in other states. The Democratic Party, which is fully in hock to unions, has controlled the legislature and most statewide posts, with the notable exception of the governor’s mansion, for more than a decade. That means more government workers, higher salaries, and drastically higher pension costs.
According to Adam Summers—a policy analyst at the Reason Foundation, the nonprofit that publishes this magazine—the state’s annual pension fund contribution vaulted from $321 million in 2000–01 to $7.3 billion last year. According to public databases, more than 5,000 people are drawing pensions in excess of $100,000 from the state of California each year.
So pervasive is the union influence that big labor doesn’t even try to defend its deleterious effects on California’s finances. Just before the special election, a member of the Los Angeles Times editorial board asked Service Employees International Union chief Andy Stern to respond to charges that unions are the 21st-century equivalent of the railroads that were once all-powerful in California. Stern verbally shrugged: “I think democracy is an ugly thing at times.”
That ugliness has made the California budget, like those in most of the other 49 states, less efficient and more bloated. Government spending, unlike spending in the private economy, is a zero-sum game—especially on the state level, since governors can’t print money. Every dollar spent gilding a pension is a dollar not spent funding an orphanage. Naturally, the same elite outlets that were busy blaming voters after the election spent even more time detailing the horrors of the “annihilating cuts,” as the Los Angeles Times called them in a news article, that were coming down the pike. (In early June, the paper invited readers to be shocked that a high school with 3,200 students would have to make do with just three guidance counselors.) Bloated pension costs and the increasingly inefficient provision of state services received a fraction of the coverage.
The federal government is now run by a president and Congress more responsive to union concerns than any in at least two decades. The same bloat currently bogging down statehouses and city halls is being duplicated in boomtown Washington, D.C. President Barack Obama even brought Andy Stern in to help warn Schwarzenegger that federal stimulus money would not be disbursed to California unless the governor rescinded some proposed state job cuts. Though that threat was later withdrawn, Schwarzenegger at press time was pushing for a measly work force reduction of 2 percent.
But there’s another interpretation of California’s rebellion, one with far sunnier implications for those of us who prefer our governments constrained. Faced with a political class that ignored bureaucratic inefficiency, that demanded higher taxes, that filled the newspapers with scare stories about people who will literally die as a result of budget cuts, the citizens of one of the bluest states in the nation collectively said we just don’t believe you anymore. If even California’s famous fruits and nuts can call the statists’ bluff, there may be hope for the rest of the country.
Matt Welch | August/September 2009 Print Edition
A very good piece on how California is a smaller version of the U.S. The people are revolting.
On May 19, California voters went to the polls to decide whether to pass a package of six tax-and-gimmick ballot propositions. Its supporters—Republican Gov. Arnold Schwarzenegger, Democratic legislative leaders, the California Teachers Association, and the overwhelming majority of the state’s major newspapers—billed it as the last best hope to plug Sacramento’s $24 billion budget deficit. “Either pass it,” warned the Los Angeles Times editorial board, “or risk fiscal disaster.”
Those who believe that either money or the media determine political outcomes should pay close heed to what happened next: Although opponents were outspent by more than 7 to 1, they trounced the state’s political class, rejecting five of the six measures by an average of 30 percentage points. The only proposition to pass was an anger-driven new law that limits elected officials’ salaries.
Faced with such thorough repudiation, California’s best and brightest then did a telling thing. They lashed right back.
The Los Angeles Times headlined its morning-after news analysis, “California Voters Exercise Their Power—and That’s the Problem.” Sacramento columnist George Skelton argued that “voters helped get themselves into this fix” by “passing feel-good ‘ballot box budgeting’ initiatives” and sanctioning “heavy borrowing” for “infrastructure projects.” Business columnist Michael Hiltzik averred that “far more blame for the deficit belongs to California voters” because “year in, year out, they enact spending mandates at the polls, often without endowing a revenue source.” Missing from any of these critiques was the fact that the Times’ own editorial board endorsed more than 90 percent of the very same ballot-box bond measures during the last decade. No matter: A perpetrator had been located.
“Good morning, California voters,” The Sacramento Bee’s post-election editorial began. “Do you feel better, now that you’ve gotten that out of your system?” The Bee, which (like the Times) had endorsed four of the five losing measures, came under immediate attack for its heavy-handed, citizen-blaming sarcasm. (A sample: “So, now that you’ve put those irksome politicians in their place, maybe it’s time to think about this: Since you’re in charge, exactly what do you intend to do about that pesky $25 billion hole in the budget?”) Rush Limbaugh gleefully read passages on his show, San Diego Union-Tribune editorial writer Chris Reed called it “staggeringly juvenile, arrogant and revealing,” and commenters on the Bee’s website were full of reactions like, “What an obnoxious editorial. Nevertheless, it illustrates that the Bee is completely in favor of bigger government and higher taxes.”
Then another funny thing happened: The Bee scrubbed the editorial off its website, replacing it with a much more conciliatory piece, addressed this time to legislators. The original editorial had been posted in “error,” the paper explained, and the new piece was the one that appeared in the print edition. “That [first] article was a draft prepared for internal discussion among members of The Bee’s editorial board,” a brief note said. “Such discussions are a routine part of our work, and frequently lead to editorials that are considerably different from writers’ first drafts.”
This instant airbrushing, normally fodder for such journalism-tracking websites as Jim Romenesko’s Media News, went virtually ignored by all but a few mostly right-leaning websites. So did another colossal gaffe, by the aforementioned Los Angeles Times columnist Michael Hiltzik, who thundered that the very notion California had a “spending problem” was an “infectious myth.”
Hiltzik claimed that the state government’s budget growth had kept pace “almost to the penny” with growth in population and inflation during the last decade. There were three problems with this analysis: Hiltzik miscalculated population growth (claiming 30 percent instead of 14 percent), he chose a federal inflation rate of 50 percent during that period instead of the California Consumer Price Index figure of 35 percent, and, most important, he excluded from state spending more than $100 billion in bond measures. This whopper was roasted and dissected on local talk radio, but it was unmentioned by more august repositories of public policy and journalism debate, such as the Times-tracking LA Observed.
Rarely has the chasm between elite political discourse and grubby popular opinion been displayed in such sharp relief. The implications of this citizen revolt—and the hostile reactions to it—stretch far beyond Nevada’s western border. California is the Ghost of Federal Government Future.
During the last two decades, the Golden State has been transformed from what was once known as the nation’s most anti-labor outpost to a state essentially run by public-sector unions. Nearly three in five publicsector workers are unionized, compared to less than two in five public employees in other states. The Democratic Party, which is fully in hock to unions, has controlled the legislature and most statewide posts, with the notable exception of the governor’s mansion, for more than a decade. That means more government workers, higher salaries, and drastically higher pension costs.
According to Adam Summers—a policy analyst at the Reason Foundation, the nonprofit that publishes this magazine—the state’s annual pension fund contribution vaulted from $321 million in 2000–01 to $7.3 billion last year. According to public databases, more than 5,000 people are drawing pensions in excess of $100,000 from the state of California each year.
So pervasive is the union influence that big labor doesn’t even try to defend its deleterious effects on California’s finances. Just before the special election, a member of the Los Angeles Times editorial board asked Service Employees International Union chief Andy Stern to respond to charges that unions are the 21st-century equivalent of the railroads that were once all-powerful in California. Stern verbally shrugged: “I think democracy is an ugly thing at times.”
That ugliness has made the California budget, like those in most of the other 49 states, less efficient and more bloated. Government spending, unlike spending in the private economy, is a zero-sum game—especially on the state level, since governors can’t print money. Every dollar spent gilding a pension is a dollar not spent funding an orphanage. Naturally, the same elite outlets that were busy blaming voters after the election spent even more time detailing the horrors of the “annihilating cuts,” as the Los Angeles Times called them in a news article, that were coming down the pike. (In early June, the paper invited readers to be shocked that a high school with 3,200 students would have to make do with just three guidance counselors.) Bloated pension costs and the increasingly inefficient provision of state services received a fraction of the coverage.
The federal government is now run by a president and Congress more responsive to union concerns than any in at least two decades. The same bloat currently bogging down statehouses and city halls is being duplicated in boomtown Washington, D.C. President Barack Obama even brought Andy Stern in to help warn Schwarzenegger that federal stimulus money would not be disbursed to California unless the governor rescinded some proposed state job cuts. Though that threat was later withdrawn, Schwarzenegger at press time was pushing for a measly work force reduction of 2 percent.
But there’s another interpretation of California’s rebellion, one with far sunnier implications for those of us who prefer our governments constrained. Faced with a political class that ignored bureaucratic inefficiency, that demanded higher taxes, that filled the newspapers with scare stories about people who will literally die as a result of budget cuts, the citizens of one of the bluest states in the nation collectively said we just don’t believe you anymore. If even California’s famous fruits and nuts can call the statists’ bluff, there may be hope for the rest of the country.
Sunday, July 5, 2009
Scientist: Global Warming Claims a Lot of Hype
Scientist: Global Warming Claims a Lot of Hype
Friday, July 3, 2009 10:17 PM
By: Phil Brennan Article Font Size
Lawmakers who described the alleged effects of global warming are spreading a lot of "eye wash," a top climate scientist says.
In an exclusive interview with Newsmax, S. Fred Singer, a renowned climatologist and professor of environmental sciences emeritus at the University of Virginia, discussed the background behind the recent open letter to Congress he and six other scientists sent to members of the House and Senate.
In the letter, the scientists cited a letter sent by the Woods Hole Research Center, which exhorted Congress to act quickly to avoid a global disaster due to alleged global warming.
Singer said the Woods Hole group “put on a sort of scary exaggerated kind of letter to Congress ahead of the vote in the House in an obvious attempt to stampede them into voting for the Waxman-Markey [cap and trade environmental] bill.
Singer explained: “We thought it would be useful to write a letter that would provide a balance. The instigator of the letter was Harold Lewis, a retired professor of physics at the University of California in Santa Barbara.” Lewis, he said, “provided the initial draft, several of us made comments and seven of us signed our names to it.”
Lewis sent the letter "to every member of Congress ... and it was also sent to a number of bloggers and others who are generally sympathetic" to the group’s point of view.
“The letter itself is self-explanatory,” Singer said, noting that it did not “give much detail.”
“Two of us, Richard Lindzen and myself, are actively working on climate issues. The others are renowned physicists – people of some stature, members of the National Academy and others who have a good amount of scientific judgment but who have not directly published or been pre-eminent in climate research.”
Asked if it is not established that the earth is cooling, Singer explained that “The earth is either always warming or cooling; one cannot tell which it is unless one specifies the time interval.
“It's like the stock market: it is rising or falling. Both depend on whether it's a week or a month or a year. It's the same with the temperature – if we start during the last Ice Age 15,000 years ago, then the temperatures have warmed. If you start from the Little Ice Age, which ended 200 years ago, it certainly has warmed.
“If you start from 1998, however, then it has not warmed – it has cooled. So it depends on the time interval. People argue about this, and much of the difference between groups comes about when you don't specify the time interval. There's no question that the climate has not been warming in the last 10 years."
Reminded that there were members of Congress standing up in the debate and talking about the terrible things that are happening now as a result of global warming, Singer said: “That's all eye wash. That's not true. That's simply hype.”
He went on to explain that “Nothing untoward is happening. The ice is not melting any faster, the sea level is not rising any faster. Hurricanes are not increasing in intensity or frequency; there's been no impact. Those things are always hard to measure. It depends on statistics. The easiest thing is to specify temperature, because it's easily measured and there is relatively little disagreement on what temperature stands for.”
He then went on to challenge what he called former Vice President Al Gore’s “mantra” that he says Gore’s "been handing out for years now – that the science is settled. That is simply not true.
“When you have 31,000 scientists signing the Oregon petition saying they disagree with the current wisdom that humans are producing increased warming, it speaks for itself. It's true that the 31,000 are not all climate scientists. There are not that many in the world.
“However, it does show you that the science is not settled. Among climate scientists there is a split. There are those who believe in models, and those who believe in observations. And there are some who don't believe in both, and some who don't believe in any.
“The modelers believe that the models correctly describe what's going on in the atmosphere, and they trust their models to predict the future. And the models all predict increased global warming. Some more, some less. There are plenty models in the world, and they all get different results. We don't know which one of them is correct, if any, or even if any of them is correct.
Then there are those – sometimes called the skeptics, but we prefer to call them the realists – who believe in the observations, who believe that the atmosphere tells us what's going on. The models try to describe what's going on in the atmosphere, but they don't succeed. It's extremely difficult – the atmosphere is very complicated. For example, the models can't really describe clouds. Yet clouds are very, very important. So that's the basic split.
“When the observations show that the climate has not been warming in the last 10 years, which contradicts the models, who are you going to believe? The models or the observations. Obviously, we believe in the observations.
“When you ask the other side to debate on this issue they either won't debate; or if they do debate, they say, Well there must be something wrong with the observations.'”
Singer agreed that it is a case of "do you believe what the models tell you, or do you believe in your lying eyes?"
Friday, July 3, 2009 10:17 PM
By: Phil Brennan Article Font Size
Lawmakers who described the alleged effects of global warming are spreading a lot of "eye wash," a top climate scientist says.
In an exclusive interview with Newsmax, S. Fred Singer, a renowned climatologist and professor of environmental sciences emeritus at the University of Virginia, discussed the background behind the recent open letter to Congress he and six other scientists sent to members of the House and Senate.
In the letter, the scientists cited a letter sent by the Woods Hole Research Center, which exhorted Congress to act quickly to avoid a global disaster due to alleged global warming.
Singer said the Woods Hole group “put on a sort of scary exaggerated kind of letter to Congress ahead of the vote in the House in an obvious attempt to stampede them into voting for the Waxman-Markey [cap and trade environmental] bill.
Singer explained: “We thought it would be useful to write a letter that would provide a balance. The instigator of the letter was Harold Lewis, a retired professor of physics at the University of California in Santa Barbara.” Lewis, he said, “provided the initial draft, several of us made comments and seven of us signed our names to it.”
Lewis sent the letter "to every member of Congress ... and it was also sent to a number of bloggers and others who are generally sympathetic" to the group’s point of view.
“The letter itself is self-explanatory,” Singer said, noting that it did not “give much detail.”
“Two of us, Richard Lindzen and myself, are actively working on climate issues. The others are renowned physicists – people of some stature, members of the National Academy and others who have a good amount of scientific judgment but who have not directly published or been pre-eminent in climate research.”
Asked if it is not established that the earth is cooling, Singer explained that “The earth is either always warming or cooling; one cannot tell which it is unless one specifies the time interval.
“It's like the stock market: it is rising or falling. Both depend on whether it's a week or a month or a year. It's the same with the temperature – if we start during the last Ice Age 15,000 years ago, then the temperatures have warmed. If you start from the Little Ice Age, which ended 200 years ago, it certainly has warmed.
“If you start from 1998, however, then it has not warmed – it has cooled. So it depends on the time interval. People argue about this, and much of the difference between groups comes about when you don't specify the time interval. There's no question that the climate has not been warming in the last 10 years."
Reminded that there were members of Congress standing up in the debate and talking about the terrible things that are happening now as a result of global warming, Singer said: “That's all eye wash. That's not true. That's simply hype.”
He went on to explain that “Nothing untoward is happening. The ice is not melting any faster, the sea level is not rising any faster. Hurricanes are not increasing in intensity or frequency; there's been no impact. Those things are always hard to measure. It depends on statistics. The easiest thing is to specify temperature, because it's easily measured and there is relatively little disagreement on what temperature stands for.”
He then went on to challenge what he called former Vice President Al Gore’s “mantra” that he says Gore’s "been handing out for years now – that the science is settled. That is simply not true.
“When you have 31,000 scientists signing the Oregon petition saying they disagree with the current wisdom that humans are producing increased warming, it speaks for itself. It's true that the 31,000 are not all climate scientists. There are not that many in the world.
“However, it does show you that the science is not settled. Among climate scientists there is a split. There are those who believe in models, and those who believe in observations. And there are some who don't believe in both, and some who don't believe in any.
“The modelers believe that the models correctly describe what's going on in the atmosphere, and they trust their models to predict the future. And the models all predict increased global warming. Some more, some less. There are plenty models in the world, and they all get different results. We don't know which one of them is correct, if any, or even if any of them is correct.
Then there are those – sometimes called the skeptics, but we prefer to call them the realists – who believe in the observations, who believe that the atmosphere tells us what's going on. The models try to describe what's going on in the atmosphere, but they don't succeed. It's extremely difficult – the atmosphere is very complicated. For example, the models can't really describe clouds. Yet clouds are very, very important. So that's the basic split.
“When the observations show that the climate has not been warming in the last 10 years, which contradicts the models, who are you going to believe? The models or the observations. Obviously, we believe in the observations.
“When you ask the other side to debate on this issue they either won't debate; or if they do debate, they say, Well there must be something wrong with the observations.'”
Singer agreed that it is a case of "do you believe what the models tell you, or do you believe in your lying eyes?"
Friday, July 3, 2009
Story about Al Franken from WSJ
The Minnesota Supreme Court yesterday declared Democrat Al Franken the winner of last year's disputed Senate race, and Republican incumbent Norm Coleman's gracious concession at least spares the state any further legal combat. The unfortunate lesson is that you don't need to win the vote on Election Day as long as your lawyers are creative enough to have enough new or disqualified ballots counted after the fact.
Mr. Franken trailed Mr. Coleman by 725 votes after the initial count on election night, and 215 after the first canvass. The Democrat's strategy from the start was to manipulate the recount in a way that would discover votes that could add to his total. The Franken legal team swarmed the recount, aggressively demanding that votes that had been disqualified be added to his count, while others be denied for Mr. Coleman.
But the team's real goldmine were absentee ballots, thousands of which the Franken team claimed had been mistakenly rejected. While Mr. Coleman's lawyers demanded a uniform standard for how counties should re-evaluate these rejected ballots, the Franken team ginned up an additional 1,350 absentees from Franken-leaning counties. By the time this treasure hunt ended, Mr. Franken was 312 votes up, and Mr. Coleman was left to file legal briefs.
What Mr. Franken understood was that courts would later be loathe to overrule decisions made by the canvassing board, however arbitrary those decisions were. He was right. The three-judge panel overseeing the Coleman legal challenge, and the Supreme Court that reviewed the panel's findings, in essence found that Mr. Coleman hadn't demonstrated a willful or malicious attempt on behalf of officials to deny him the election. And so they refused to reopen what had become a forbidding tangle of irregularities. Mr. Coleman didn't lose the election. He lost the fight to stop the state canvassing board from changing the vote-counting rules after the fact.
This is now the second time Republicans have been beaten in this kind of legal street fight. In 2004, Dino Rossi was ahead in the election-night count for Washington Governor against Democrat Christine Gregoire. Ms. Gregoire's team demanded the right to rifle through a list of provisional votes that hadn't been counted, setting off a hunt for "new" Gregoire votes. By the third recount, she'd discovered enough to win. This was the model for the Franken team.
Mr. Franken now goes to the Senate having effectively stolen an election. If the GOP hopes to avoid repeats, it should learn from Minnesota that modern elections don't end when voters cast their ballots. They only end after the lawyers count them.
Mr. Franken trailed Mr. Coleman by 725 votes after the initial count on election night, and 215 after the first canvass. The Democrat's strategy from the start was to manipulate the recount in a way that would discover votes that could add to his total. The Franken legal team swarmed the recount, aggressively demanding that votes that had been disqualified be added to his count, while others be denied for Mr. Coleman.
But the team's real goldmine were absentee ballots, thousands of which the Franken team claimed had been mistakenly rejected. While Mr. Coleman's lawyers demanded a uniform standard for how counties should re-evaluate these rejected ballots, the Franken team ginned up an additional 1,350 absentees from Franken-leaning counties. By the time this treasure hunt ended, Mr. Franken was 312 votes up, and Mr. Coleman was left to file legal briefs.
What Mr. Franken understood was that courts would later be loathe to overrule decisions made by the canvassing board, however arbitrary those decisions were. He was right. The three-judge panel overseeing the Coleman legal challenge, and the Supreme Court that reviewed the panel's findings, in essence found that Mr. Coleman hadn't demonstrated a willful or malicious attempt on behalf of officials to deny him the election. And so they refused to reopen what had become a forbidding tangle of irregularities. Mr. Coleman didn't lose the election. He lost the fight to stop the state canvassing board from changing the vote-counting rules after the fact.
This is now the second time Republicans have been beaten in this kind of legal street fight. In 2004, Dino Rossi was ahead in the election-night count for Washington Governor against Democrat Christine Gregoire. Ms. Gregoire's team demanded the right to rifle through a list of provisional votes that hadn't been counted, setting off a hunt for "new" Gregoire votes. By the third recount, she'd discovered enough to win. This was the model for the Franken team.
Mr. Franken now goes to the Senate having effectively stolen an election. If the GOP hopes to avoid repeats, it should learn from Minnesota that modern elections don't end when voters cast their ballots. They only end after the lawyers count them.
None Dare Call It Marxism
By David Limbaugh
July 3, 2009
All right already. I won't call Obama a Marxist in this column. Instead, I'll point to some signs that indicate that Barack and Karl might well be soul mates. At least, they have similar attitudes about capital, labor and profits, er, surplus value.
Liberals, even those of the Marxist variety, take umbrage when you point out their ideological kinship with Marxism.
I suppose this dates back to the days when being a communist was tantamount to being an enemy of the United States, in that there was a global communist movement intent on -- and coming darn close to -- world domination. Though global communism has been defeated, there remains a strong contingent among us, whose nerve center is the Democratic Party leadership under President Obama, committed to obliterating America's free market.
Without getting into the intricacies of Marxist theory, suffice it to say that at the core of this political and economic philosophy is a belief in the historical class struggle. The capitalist (bourgeois) exploits the industrial worker (proletarian) by underpaying him and adding on unnecessary charges to the prices of goods and services, driving up costs to the consumer, and pocketing the profits.
In "Basic Economics," Thomas Sowell puts it this way: "Profits may be the most misconceived subject in economics. Socialists have long regarded profits as simply 'overcharge,' as Fabian socialist George Bernard Shaw called it, or a 'surplus value' as Karl Marx called it." The theory is that under socialism or Marxism, these surplus charges would be eliminated and goods and services would become more affordable.
But in reality, socialism doesn't make goods and services more affordable, but less so. As Dr. Sowell explains: "The hope for profits and the threat of losses is what forces a business owner in a capitalist economy to produce at the lowest cost and sell what the customers are most willing to pay for. ... Under socialism (there is) far less incentive to be as efficient ... much less to keep up with changing conditions and respond to them quickly." With less incentive for efficiencies and cost control, the prices of goods might well be higher.
Profits are not arbitrary charges added on to the costs of producing goods and services; nor are they attributable to artificially high prices charged by those motivated by greed. Indeed, writes Sowell, most of the great fortunes in American history were amassed when entrepreneurs were able to reduce costs and charge lower prices and to increase their volume sales to mass markets.
You get the point. Capitalists don't view profits as evil or the product of greed. Their opponents -- call them Marxists, fascists, socialists, radical liberals or whatever -- do. Which brings us back to Barack Obama.
Both his father, Barack Obama Sr., and his mentor, Frank Marshall Davis, were communists. His church of choice was one of black liberation theology, whose Marxist roots are inarguable. He associated with far leftists on the "organizing" streets of Chicago, including Bill Ayers and Bernardine Dohrn.
Mentorship and associations are one thing, but what have Obama's words and actions revealed about his attitudes toward labor, capital, profits and government control of business and industry?
Well, he said that he would raise capital gains tax rates, even if it reduced revenues, as a matter of fairness. It's only fair to make everyone poorer if you believe profits are inherently evil.
He told Joe the Plumber he wants to spread the wealth around. He talked about confiscating Exxon Mobil's profits and giving them to consumers, saying "they are not going to give up those profits easily." He called Chrysler creditors "speculators" and castigated them for refusing to accept his extortionist reorganization plan. He berated Wall Street for making profits, saying "now is not (the) time" for them to "rake in profits." He and his wife even railed against the pursuit of profit in their respective commencement addresses.
He abused the power of his office to steal money from GM and Chrysler shareholders and transfer it to the proletariat, I mean, the United Auto Workers. He redistributed taxpayer money from those who have paid their mortgages to those who have not.
He is desperately trying to spread the misery and impoverish businesses and individuals through his cap and tax plan, which no proponent of economic growth and prosperity would consider supporting. And in addition to gobbling up other businesses and industries, he is trying to nationalize medicine -- to siphon off the evil surplus value charged by doctors and insurance companies -- on the flawed Marxist theory that he can reduce costs overall, when the reason health care costs have already skyrocketed is that market forces have been suppressed in the industry.
You don't have to call him a Marxist, but at least understand where his heart is.
---
David Limbaugh is a writer, author and attorney. His book "Bankrupt: The Intellectual and Moral Bankruptcy of Today's Democratic Party" was released recently in paperback. To find out more about David Limbaugh, please visit his Web site at www.DavidLimbaugh.com.
July 3, 2009
All right already. I won't call Obama a Marxist in this column. Instead, I'll point to some signs that indicate that Barack and Karl might well be soul mates. At least, they have similar attitudes about capital, labor and profits, er, surplus value.
Liberals, even those of the Marxist variety, take umbrage when you point out their ideological kinship with Marxism.
I suppose this dates back to the days when being a communist was tantamount to being an enemy of the United States, in that there was a global communist movement intent on -- and coming darn close to -- world domination. Though global communism has been defeated, there remains a strong contingent among us, whose nerve center is the Democratic Party leadership under President Obama, committed to obliterating America's free market.
Without getting into the intricacies of Marxist theory, suffice it to say that at the core of this political and economic philosophy is a belief in the historical class struggle. The capitalist (bourgeois) exploits the industrial worker (proletarian) by underpaying him and adding on unnecessary charges to the prices of goods and services, driving up costs to the consumer, and pocketing the profits.
In "Basic Economics," Thomas Sowell puts it this way: "Profits may be the most misconceived subject in economics. Socialists have long regarded profits as simply 'overcharge,' as Fabian socialist George Bernard Shaw called it, or a 'surplus value' as Karl Marx called it." The theory is that under socialism or Marxism, these surplus charges would be eliminated and goods and services would become more affordable.
But in reality, socialism doesn't make goods and services more affordable, but less so. As Dr. Sowell explains: "The hope for profits and the threat of losses is what forces a business owner in a capitalist economy to produce at the lowest cost and sell what the customers are most willing to pay for. ... Under socialism (there is) far less incentive to be as efficient ... much less to keep up with changing conditions and respond to them quickly." With less incentive for efficiencies and cost control, the prices of goods might well be higher.
Profits are not arbitrary charges added on to the costs of producing goods and services; nor are they attributable to artificially high prices charged by those motivated by greed. Indeed, writes Sowell, most of the great fortunes in American history were amassed when entrepreneurs were able to reduce costs and charge lower prices and to increase their volume sales to mass markets.
You get the point. Capitalists don't view profits as evil or the product of greed. Their opponents -- call them Marxists, fascists, socialists, radical liberals or whatever -- do. Which brings us back to Barack Obama.
Both his father, Barack Obama Sr., and his mentor, Frank Marshall Davis, were communists. His church of choice was one of black liberation theology, whose Marxist roots are inarguable. He associated with far leftists on the "organizing" streets of Chicago, including Bill Ayers and Bernardine Dohrn.
Mentorship and associations are one thing, but what have Obama's words and actions revealed about his attitudes toward labor, capital, profits and government control of business and industry?
Well, he said that he would raise capital gains tax rates, even if it reduced revenues, as a matter of fairness. It's only fair to make everyone poorer if you believe profits are inherently evil.
He told Joe the Plumber he wants to spread the wealth around. He talked about confiscating Exxon Mobil's profits and giving them to consumers, saying "they are not going to give up those profits easily." He called Chrysler creditors "speculators" and castigated them for refusing to accept his extortionist reorganization plan. He berated Wall Street for making profits, saying "now is not (the) time" for them to "rake in profits." He and his wife even railed against the pursuit of profit in their respective commencement addresses.
He abused the power of his office to steal money from GM and Chrysler shareholders and transfer it to the proletariat, I mean, the United Auto Workers. He redistributed taxpayer money from those who have paid their mortgages to those who have not.
He is desperately trying to spread the misery and impoverish businesses and individuals through his cap and tax plan, which no proponent of economic growth and prosperity would consider supporting. And in addition to gobbling up other businesses and industries, he is trying to nationalize medicine -- to siphon off the evil surplus value charged by doctors and insurance companies -- on the flawed Marxist theory that he can reduce costs overall, when the reason health care costs have already skyrocketed is that market forces have been suppressed in the industry.
You don't have to call him a Marxist, but at least understand where his heart is.
---
David Limbaugh is a writer, author and attorney. His book "Bankrupt: The Intellectual and Moral Bankruptcy of Today's Democratic Party" was released recently in paperback. To find out more about David Limbaugh, please visit his Web site at www.DavidLimbaugh.com.
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