Imperfect America

Imagine if Barack Obama gave you the $5,000 a year you're on the hook for...

2012-01-30T02:32:00.000-08:00

I’m a huge fan of lotteries. It is one of the few taxes that citizens pay willingly. Spending a dollar for the prospect of winning a hundred million is kind of fun. And the fact that the state’s provide the fig leaf of responsibility by suggesting all funds go to support education makes players feel like they are doing their part to support the kids… Imagine, a way of taxing people that is actually voluntary!

Unfortunately however, most taxes are anything but voluntary, particularly those levied by the federal government. In 2011 the federal government took in $2.3 trillion in taxes. Not only did all of that get spent, but about $1.4 trillion more. And now Barack Obama is in charge of the spending machine. In the three years he has been President, Obama has spent over $11 trillion. That includes not only the $6.6 trillion Uncle Sam took in in taxes, but an additional $4.6 trillion that has been borrowed on your behalf, or at least for which you have the responsibility to repay. If we split that sum up amongst every one of the 310 million people in the country that would mean that Barack Obama has racked up $15,300 in debt on behalf of every American… in a mere three years.

I’d like to give that $4.6 trillion sinkhole a little perspective. Imagine that instead of that money going to failed green jobs scam companies like Solyndra or to university research departments to play World of Warcraft, something completely different happened. Imagine that on January 20, 2009 Barack Obama had knocked on your door, teleprompter in hand, and said “(Insert taxpayer’s name here) I’d like to thank you for giving me the opportunity to be your President. And to show my gratitude I’d like to give you $5,000 a year each of the next three years. Now, you’ll have to pay it back of course, but I’ll spread the payments over 30 years and give you an interest rate of about zero.” You think to yourself “If I don’t take the deal he’s just going to barrow it in my name and spend it on poetry readings or some such thing.” Deciding you could come up with much better places to spend the money, you respond “Thank you Mr. President. I’ll take the checks.”

Wow. He gives you the check. Now you have a $5,000 you didn’t have the day before. You start dreaming…”What am I going to spend my new found money on?” Well, if you were an average driver, who uses approximately 700 gallons of gas a year, you could pay for gasoline for the year and still have about $3,000 left over. You could then spend $720 on clothes, $1,000 on entertainment and still have enough left over to cover half of your healthcare expenditures. “Not bad” you think.

Now of course, that is just one $5,000 check. Given that the average American home has 2.6 people in it, the President quickly takes the $5,000 check back and gives you a $13,000 family sized check instead. You think “Wow, almost $40,000 over three years! Now that’s some serious cash!” At $13,000 the government just covered more than 80% of the total cost of what the average American family spends on housing. That’s pretty nice. At a rate that is lower than your mortgage as well. “This is going to be great” you tell yourself.

Then, suddenly, just as the President is about to leave you stop dreaming and start thinking about the big picture. “Mr. President! Wait! $13,000 a year for my family would be nice, God knows we could use it, but I don’t want to bankrupt the country or close down the government or endanger the national defense.” “Good citizen” President Obama calls you, “Don’t worry about that, we’ll make do with the just the $2.2 trillion or so we take in in taxes annually, which is, exactly what we spent way back in the ancient period known as 2004.” - remember this is a dream.

The wheels start turning in your mind… How different is your life in 2009 relative to 2004, and how much did a bigger government have to do with making it better or worse? Recognizing that the growth in government didn’t do much to make life any better over that time, you decide you can indeed live with a government budget circa 2004. “Ok, Mr. President, never mind, I’ll keep the money! Thank you!”

Of course, that was all a dream. Unfortunately for you – and the rest of America – you are apparently too stupid to know what to do with your own money, or in this case, the money the government borrows but forces you to pay back. As such, no mortgage payments for you. No gas money, movie money, no check to cover your family’s annual food and insurance bills combined. No, unfortunately, while you are indeed on the hook for the money, guys like Barack Obama, Harry Reid and Barney Frank get to decide where all that money (and much more) goes…

Fundamentally that is the problem. And it’s not just money. Nor is it just the federal government. Increasingly it’s all levels of government and it’s seemingly about everything. Rather than parents being responsible for their kid’s fitness, schools have to ban burgers and pizza. Rather than drivers being able to purchase the kinds of vehicles they want, the government mandates auto companies sell cars no one wants and forces drivers to put inflation spurring ethanol into them. Rather than consumers and markets deciding what banks, and energy companies and health insurance companies should succeed, the government sticks its nose in virtually everywhere at almost every turn.

At the end of the day, few people could or would run their lives the same way the government runs the country – and unfortunately running the country is exactly what governments try and do. Fantasy budgeting and accounting, a distinct lack of accountability, a nonexistent correlation between success and continued funding, and a Pollyanna notion that all human problems and foibles can be obviated by government fiat.

Whether we get another four years of Barack Obama (God help us…) or a first term of one of the big government “conservatives” currently vying for the GOP nomination, voters should understand that the deficits and the regulation creep and the basic suffocation of the capitalist system that made America great will not be put asunder until we nominate and elect a President who:

Recognizes that the power of the federal government is constrained by the Constitution, particularly the 10th Amendment;
Understands that role of government is to do only those things which citizens cannot do themselves and nothing more;
Has the intelligence to know where the line between the two is;
Has the courage to tell voters to begin acting accordingly.

That doesn’t sound like too difficult a task. One wonders why the GOP can’t seem to figure it out.

The boy who cried wolf... or the demagogues who cry “Racism"

2012-01-23T01:41:00.000-08:00

We’ve all heard the story “The boy who cried wolf” about the boy who falsely cried out so often that when the wolf finally appeared none of the townsfolk came to his assistance because they assumed he was once again lying. The same thing has been happening in the United States with the charge of racism. The problem is, when the word racism is used so often by so many people in such patently absurd contexts the charge and the word cease to have any value.

Of course, what many people often refer to as racism is in reality racial discrimination, and in most cases the activity charged as racism is neither.

Racism is a belief in an inherent difference in the cognitive and physical abilities of members of different groups based on race, which manifest themselves in social and economic achievement. Such differences are usually organized in hierarchical manner putting the proponent of the theory’s race in the superior position.

Racial discrimination is the treatment or making a distinction, gift or punishment for or against, a person or group based on the race to which that person or persons belong rather than on individual / group merit.

The dilution of the charge of racism has been going on in the United States for decades. The housing crisis that brought about the economic meltdown in which we find ourselves today was the direct result of federal regulations intended to counteract false claims of racist / discriminatory practices on the part of mortgage lenders.

More recently the cries of racism have been thrown around like rice at a wedding since Barack Obama became a candidate for President. From individuals to Tea Party activists to radio talk show hosts, every disagreement with the policies of Barack Obama is at some point reduced to the simple charge of racism. It does not even appear as if race itself is a defense against such claims as can be seen by the denunciations of Herman Cain.

Is it possible that by 2012 the overuse of the charge of racism has finally contributed to its own demise? Perhaps two absurd events from last week will be a sign of the false charge's swan song.

The first comes from Dallas and has to do with Microsoft’s purported “Avoid the Ghetto” app for smartphones – a name suggested by critics rather than the company. The app, which is said to use crime statistic data, is supposed to offer drivers and pedestrians the opportunity to set routes to their destination that avoid high crime areas.

Dallas NAACP President Juanita Wallace seems to be unhappy about the as of yet unavailable product: "It’s almost like gerrymandering,” she said. “It’s stereotyping for sure and without a doubt; I can’t emphasize enough, it’s discriminatory.” However, the app will not label communities based on race. It is not going to tell users to avoid minorities or minority communities. It is is rather simply going to inform users about neighborhoods where a high number of crimes have been reported and offer them alternative routes to getting to their destinations. Certainly James Cooper and James Kouzaris could have used it.

Whatever the demographics of the neighborhoods drivers or pedestrians avoid as a result of Microsoft’s app, claims of racism or racial discrimination are absurd. Crime is crime, regardless of who perpetrates it. Indeed, it is President Wallace who has suggested the connection between crime and minority communities, not Microsoft.

The second story comes from Burlington, Vermont. At a time when consumers are put off by many bank’s limited hours and increasingly automated services, TD Bank sees an opportunity to distinguish itself from its competitors by opening for business every day other than Christmas, Thanksgiving, Easter Sunday and New Years Day. In the highly competitive marketplace the bank is seeking to succeed by providing more services to attract more customers. The result? The branch in Burlington, Vermont was picketed for being open and serving its customers on the MLK holiday. Protesters printed flyers suggesting the bank was racist: “Dear TD Bank, you are defying the King holiday. Shame, Shame, Shame. This is a racist act. Shame, Shame, Shame.”

In what universe is a company seeking to provide its clients – all clients, regardless of race – with better service acting in a racist, or more accurately, a racially discriminatory manner? Only in a leftist, victim mentality universe fueled by the Democratic Party.

As we approach the battle for the White House those of us who disagree with the policies of President Obama should be prepared to be labeled racists for virtually every utterance. Of course it is possible that the false charge of racism has jumped the shark and will finally be disregarded by citizens as just another Democratic tool of intimidation and slander. Possible, but unfortunately... unlikely.

I’m afraid it’s more likely to be another Hollywood creation, Freddy from the Friday the 13th franchise that more accurately characterizes the future of the false charge of racism. Even when it is so widely seen as debased and hollow, when it should be dead after so many false utterances, the charge of racism is likely to once again be an instrument of the left with which it seeks to intimidate conservatives and distract voters from the abject failure of decades of Democratic policies – whose victims are both black and white. That's unfortunate because real examples of racism and racial discrimination do indeed exist, but because the left has purloined the charge for its insidious ends those real examples are far less likely to be taken seriously. And for that we are less well off.

Rick Perry should harness an imploding Europe to define his message to GOP voters.

2012-01-16T09:02:00.000-08:00

It is said that history is written by the victors. In the case of the 2012 election it’s hard to see how that’s even possible given that with the current trajectory of the GOP primaries we’re all going to end up losers.

Rarely does it occur that choices and consequences of government policies are so starkly presented for an electorate as they are today. Unfortunately, I’m not talking about the GOP field as an alternative to our big government president.

Today, the national debt stands at approximately $15 trillion, or almost $50,000 per American citizen. $4.6 trillion of that debt was run up under Barack Obama. That exceeds the combined amount of debt accumulated by every president from George Washington through the first George Bush. Everyone knows that too much debt is a bad thing. Even Candidate Barack Obama knew enough and told us on the campaign trail:

The problem is, that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents, # 43 added $4 trillion by his lonesome so that now we have over $9 trillion of debt that we are going to have to pay back, $30,000 for every man woman and child. That’s irresponsible. It’s unpatriotic.

So what George Bush accomplished in eight years, Barack Obama has accomplished in three. And it's only going to get worse. By Candidate Obama’s rationale that must make President Obama über unpatriotic.

Well, the President will tell you that the policies behind that spending were necessary to save the country from a depression and are finally beginning to bear fruit. He’d point to December’s unemployment rate that dropped to 8.5%, from a peak of 10.1% in November of ’09. As the fourth best president in our history, he’s obviously doing something right.

Or maybe not… When Barack Obama took office the population of the United States was 306 million and there were 186 million people working with an additional 14.9 million people looking for work, resulting in an unemployment rate of 7.4%. (14.9 million / 201 million) That 201 million is called the Workforce and it’s the key to understanding unemployment numbers. Workforce is defined as the following:

Total number of a country's population employed in the armed forces and civilian jobs, plus those unemployed people who are actually seeking paying work.

Today, three years after Barack Obama took office the population has grown to 312 million but the workforce has actually shrunk from 201 million to 199 million. That means that despite adding 6 million people, the number of Americans working or actively seeking work has dropped by 2 million. Add to that the 4 million working age new Americans and you have a total of 6 million more people not working or even looking since Barack Obama took office. That’s how you get to 8.5% unemployment; you get people to stop looking for a job in the first place. He’s definitely doing something, but it’s not good. Nor is it unprecedented.

The big government policies that Barack Obama is shoving down American’s throats are this very day showing themselves to be utterly unsustainable a mere 5,000 miles away. Within the last week S&P downgraded the debt of nine (9) European countries, including EU giants France, Italy and Spain. The Euro is on the brink and the economies are disasters. If that were not bad enough, unemployment in Europe is so high (10% overall and 9% in France, 14% in Ireland, 18% in Greece and a whopping 23% in Spain) that a continent already unable to replace itself is shrinking even faster as an increasing number of its citizens emigrate to seek jobs elsewhere. In Greece the economic problems are so bad that parents are now abandoning babies and children at hospitals and churches across the country.

Which brings us back to the American election of 2012. The big government policies of Barack Obama are bringing the train wreck that is Europe to our shores. Unfortunately, the candidates leading the GOP charge to unseat him are little better, despite their protestations to the contrary. They claim to be conservatives, but they are not. They are big government advocates, just less so than Barack Obama.

Even more unfortunate is the fact that the only candidate in the GOP field who actually has a record of pursuing small government policies is seemingly unable to articulate those ideas to the average voter. If that candidate, Rick Perry, is to have any chance at all to resurrect his campaign he will have to do something dramatically different and he’ll have to do it soon. He should drop the oafish Bain Capital attacks and instead focus in a laser like fashion on smaller government. That is the one issue that every American can relate to regardless of age, sex, race etc. The rapacious nature of government must be demonstrated in a way they understand. In South Carolina, where the NLRB just tried to kill a Boeing plant, that message should resonate particularly well.

And how should he do that? With PowerPoint of course. PowerPoint might be a stretch, but not by much. The image of a burning Europe with its big government economies in ruin, double digit unemployment, rioters in the streets and babies abandoned on the sidewalks makes a perfect foil for the big government policies of both Barack Obama and the rest of the GOP field. Those are the kinds of images that voters can relate to because they see more and more of them on our own shores. And of course PowerPoint would come in handy when trying to remember what agencies to cut…

It would be a shame if when the history of the 2012 election is written Rick Perry is reduced to a 53 second footnote. Particularly because that means that some big government advocate won. Despite how damaging that sub one minute episode was, it need not be fatal to his campaign, but the time is getting short. With only 2% of the delegates decided, Rick Perry still has an opportunity to resurrect his campaign and maybe change history. His only hope is to harness the power of what Americans clearly don’t want, which is on such brilliant display right across the pond. With the images of Athens on fire, London under siege of by rioters and Naples covered in trash, even the least engaged voter can understand the correlation between big government and economic ruin and social failure. It’s up to Rick Perry to figure out how to make that case. If he does he has a shot at winning. If he can’t he’s destined to be a footnote in American political history.

Single Issue Stupidity and Rick Santorum

2012-01-09T01:33:00.000-08:00

I remember hearing once that in Shakespeare’s day the cumulative writings an educated person could be expected to encounter over the course of their lifetime was the equivalent one week’s worth of the New York Times. Today things are slightly different in that we get a week’s worth of the New York Times every week – whether we want it or not. In addition, thousands of times that volume of content is every day via print, broadcast and internet media. As such, anyone who doesn’t want to be overwhelmed to the point of becoming catatonic has to focus their attention on sources of news and information they perceive to be reliable, honest and accurate.

Modern voters find themselves in a similar situation. The possible issues about which one might be concerned are literally infinite. From the national unemployment rate, to state referendums to local zoning ordinances, a voter can be overwhelmed with trying to get even a cursory understanding of the issues. Add to those issues dozens of candidates with varying positions and you have a recipe for catatonia. All of this while voters are busy living their lives, raising their kids, spending time with friends etc.

Voters typically deal with this surfeit of choices by narrowing the focus, in a similar way to what they do with information sources, i.e. look to sources they think they can trust. When they see a candidate pilloried on 60 Minutes for wanting to rationalize (aka “slash”) Social Security or when the New York Times runs a piece about how brilliant a particular presidential candidate is, fans of those sources know how to vote. Another way citizens decide who they are going to vote for is by joining particular organizations that seem to be made up of people who share many of their beliefs or values such as various Tea Parties or community organizations.

The extreme of this narrowing of one’s focus is the single issue voter. The person or organization focuses on a single issue upon which they make their decision as to who to vote for. One of the most well known such single issue organizations is the National Rifle Association. The NRA is an advocate for 2nd Amendment rights, which is a strong Constitutional position to take. It’s “incumbent-friendly” policy however is not very logical. It supports many Democrats who, while supporting the 2nd Amendment, shred the rest of the Constitution. In 2010 the NRA supported 53 pro 2nd Amendment House Democrats, most of whom were facing pro 2nd Amendment Republicans. It didn’t matter to the NRA that the House under Nancy Pelosi was running roughshod over the Constitution and therefore, to borrow a idea from Martin Niemöller, once the Constitution was in tatters there would be no 2nd Amendment to protect. Smart.

A similar scenario is playing itself out in the GOP primary and the beneficiary of such absurdity is Rick Santorum. Rick Santorum surged in Iowa and almost beat the regrettably frontrunning Mitt Romney. How did he do it? A big part of it was that he was essentially the last man standing in the anti-Romney corner. A significant part however is his focus on social issues, particularly his strident anti-abortion message. (In Iowa, according to St. Louis Today, among Iowa caucus-goers who regard abortion as their most significant issue, 55% voted for Santorum.)

While the notion of being anti-abortion is certainly mainstream in the GOP, having abortion as a voter’s single issue, or most important issue during what is going to be the most important election in a century makes no sense at all. There are so many threats to the nation as a whole that to base one’s vote on that single issue is absurd – particularly as abortion rates have dropped by 30% in the last 20 years and a president's impact is minimal regardless. How did unborn babies fare in the Soviet Union? Not particularly well. How did unborn girls fare in China over the last three decades? Not well either. Counter-intuitively, the Socialist Mecca of Europe has lower abortion rates than we do, but one wonders if that might be because they’ve stopped having sex or something because they are not having many babies either…

Voting for the candidate who is most vociferous in his defense of your one issue to the exclusion of everything else is suicide. While candidate Rick Santorum speaks about limited government and lower taxes and overregulation on the campaign trail, Senator Rick Santorum was far from a constitutional conservative. He voted in support of most of George Bush’s big government agenda, he voted against NAFTA, voted for steel tariffs and was a huge supporter of earmarks. And just in case there’s some uncertainty as to Rick Santorum’s view of the role of government, in 2004 he laid out his view very clearly:
One of the criticisms I make is what I refer to as more of a Libertairanish right. They have this idea that people should be left alone, be alone to do whatever they want to do, government should keep our taxes down and keep our regulations low, that we shouldn’t get involved in the bedroom, that we shouldn’t get involved in cultural issues. That is not how traditional conservatives view the world. There is no such society that I am aware of, where we’ve had radical individualism and that it succeeds as a culture.
Obviously Rick Santorum has never heard of the United States. Both his record and his words make it crystal clear that he is no friend of limited, constitutional government. Big government has set us on a course to turn the United States into a socialist / statist Mecca. Unfortunately for everyone involved (and that includes unborn babies) that Mecca is more like a nightmare of economic malaise, sub standard medical care, a lack of individual freedom and long term social decline. Rick Santorum may sound great on babies, but he will do nothing to take us off that path to disaster. Those single issue voters who are supporting him just might want to think again, or consider the prognosis for the country (and its unborn babies) once America becomes an economic basket case and modern day dystopia.

19th century slavery created the GOP, will 21st century slavery be its demise?

2012-01-02T05:28:00.000-08:00

Will 2012 bring an end to the Republican Party? It would only be fitting that a party formed almost 160 years ago on the basis of stopping the expansion of slavery would be destroyed by its support of the modern day expansion of slavery of a different sort.

That is exactly where we stand. The GOP was formed in 1854 in reaction to the passage of the Kansas Nebraska Act which essentially opened up the West to the expansion of slavery. Many Northerners understood that mostly poor free men and could not compete with giant Southern landowners who employed slave labor. The Kansas Nebraska Act heralded the end of the delicate balance between slave and free states that had largely been in place since the ratification of the Constitution in 1788. Slave states already having disproportionate congressional power, the Kansas Nebraska Act would provide the foundation them to gain significantly more economic power to grow as well.

Drawing its membership from the remains of the Whig Party and the anti-slavery wing of the Democratic Party, the GOP’s first candidate for President, California’s John C. Frémont lost. Their second candidate however did somewhat better: Abraham Lincoln.

Fast forward and the party ended slavery (and passed the civil and voting rights acts a century later) has become a party of modern slavery in the form of big government. Although the Democrats have traditionally been the party of big government, today they share that label with a vapid GOP.

2012 is the best opportunity Americans have had in 30 years to attempt to throw off the yoke of government tyranny. In the wake of the 2010 elections when the GOP not only won an historic victory in the House, but in the Senate such small government candidates as Rand Paul, Marco Rubio and Mike Lee prevailed, one would think that the party understood where the future of success with the American people lay. Unfortunately however that does not seem to be the case.

On a national scale the Republican Party cannot seem to understand its place in this historic moment in time. In 2012 the slavery that Americans face at the hands of the federal government is clear:

A tax code where half the population pays no income taxes and more than a third receive government subsidies. (This is at its core a massive and growing redistribution of wealth from wealth creators to wealth consumers.)

A federal spending binge that has more than doubled in the last two decades, consequently distorting capital markets and destroying free market solutions.

A nanny state that stymies a citizen’s right to live his life as he chooses and do with his property what he chooses. (Federal laws and regulations are so numerous and complex that the ABA and other organizations who have attempted to catalog them have repeatedly failed. Says one researcher: "There is no one in the United States over the age of 18 who cannot be indicted for some federal crime")

A regulatory nightmare that grows darker each day for entrepreneurs and businesses who are inclined to try and start or grow businesses to meet the desires of markets or consumers.

An unrelenting growth in legislative and regulatory distortion of free markets to favor the politically connected.

Not the kind of slavery that was the catalyst for the formation of the GOP, but slavery nonetheless. And the party has been complicit in much of what brought us to this point.

In the face of such oppression, rather than offer voters a slate of candidates who are competing on the basis of who will make greater cuts in government spending, who is most willing to eliminate unnecessary and unconstitutional departments and agencies, who will do more to reduce regulation and who will allow citizens to keep the greatest share of their incomes, the Grand Old Party has as its frontrunner a big government, crony capitalist who is not beyond playing the wealth envy card. Nowhere in the GOP field is there a candidate who vows to cut government spending to what it was two decades ago. Nowhere in the GOP field is there a candidate who vows wage war on government regulation.

In 1980, when Americans saw all too clearly the consequences of an unabashedly progressive agenda, the GOP responded (despite the wishes of party insiders) with Ronald Reagan, a man who was not afraid to clearly articulate that government was the problem and that it must be restrained and cut – remember he promised to shutter the Education and Energy departments, only to be stymied by a Democrat controlled Congress.

Today, 30 years later, when federal spending has increased by 500%, when government regulation is exponentially more intrusive, when half of the population is relieved of paying for the operations of government, the GOP field is populated by big government advocates or those who want to simply trim around the edges and rearrange deckchairs on the Titanic.

A GOP victory in 2012 with a lukewarm conservative who is happy to simply slow the rate of increase in government spending and to tentatively trim government regulations will be a defeat for the American people. The country will become Greece or Italy… only more slowly. A better outcome for the country might be another four years of Barack Obama. At least by 2016, assuming the country hasn’t collapsed by then, a party might emerge that will finally present the American people with a real choice between slavery and freedom.

Greed vs. Giving... Trickle down charity is a recipe for real long term success

2011-12-26T07:46:00.000-08:00

Rush Limbaugh caused a bit of a stir recently when he asked the question: “What do you think has fed more mouths, greed or charity?” The question seemed particularly untoward given that Christmas was right around the corner. Who besides Gordon Gekko might ask such a ludicrous question? Rush, obviously… and it turns out that it’s not such a ludicrous question after all.

Of course when he says greed, what he is really referring to – and he says as much – is self interest. Basically what he is arguing is that while giving charity to someone may make the donor feel good and sometimes has a positive effect on the recipient, the real way to improve the lot of people is to act in your own self interest – within the rule of law of course – and the benefits will flow to others, either directly or via giving. You might call this trickle down charity.

Not long ago I wrote a piece about Steve Jobs stating that despite giving Jack to charity, he did more to improve the lives of people around the world over the last 35 years than possibly anyone other than Bill Gates. Of course Gates has given away tens of billions of dollars, but in reality he has benefited the world far more by founding and growing Microsoft than anything he has done or likely will ever do with the Bill and Melinda Gates foundation.

To understand the level of failure that charity & giving can accomplish one need only look at Africa. In her brilliant book: Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa", Dambisa Moyo writes: “Over the past 60 years at least $1 trillion of development-related aid has been transferred from rich countries to Africa. Yet real per-capita income today is lower than it was in the 1970s, and more than 50% of the population -- over 350 million people -- live on less than a dollar a day, a figure that has nearly doubled in two decades.” Moyo argues that not only does aid actually destroy much of the potential economic development of African nations and enables corrupt leaders to maintain their power, at the same time it encourages would-be dictators to attempt to overthrow existing regimes, which in turn creates more war and poverty.

Food is one of the most brutal forms of aid. Many countries receive aid in the form of American agricultural products. The result of these gifts is that, as local farmers cannot compete with free food, their farms fail, and any chance of self sustainability vanishes. It’s the whole notion of “Give a man a fish, feed him for a day… Teach a man to fish, feed him for a lifetime.” In the case of Africa the world’s aid (and food is only part of that problem) is destroying the capacity of the recipients to become self sustaining, resulting in a vicious circle of aid, corruption and poverty.

Here in the United States the record of success via “giving” is largely the same. After six decades and trillions of dollars of government “aid” in the form of welfare and government education, the poverty problem is not only not getting any better, but it’s actually getting worse! We have record levels of people with no discernable skills, little ability to support themselves and most seeking support at the public trough. A smashing success of compassion!

None of this should be taken to suggest that giving is a bad thing. It’s not. Particularly when it’s done to ameliorate incidental or disaster induced problems, big or small. Giving however should not be seen as a long term solution to improving the condition of man. The problem is that giving typically comes with few, or poorly enforced, requirements on the part recipient, particularly when those “gifts” come from the government or international organizations like the UN or the IMF. Compare the different outcomes between 1960 and today of the Asian tigers and sub-Saharan Africa. In 1960 South Korea’s GDP per capita was twice that of sub-Saharan Africa’s, but in 2005 it was almost 24 times as much. The story is similar for countries such as Indonesia, Malaysia, Cambodia and Vietnam, who went from half the per capital GDP of sub-Saharan Africa in 1960 to five times it today. While all of these tigers received aid at some point, in Africa the aid became an end in and of itself while in Asia it was used as a step to economic growth and development.

Andrew Carnegie provides a perfect example of how both greed and giving can work together. In the late 19th century he was the richest man in the world, and in 1889 he wrote a piece called “Wealth” where he argued that the adult life of an industrialist should comprise two parts. The first part was the accumulation of wealth. The second part was the distribution of that accumulated wealth to benevolent causes. Philanthropy, Carnegie argued, was key to making the life worthwhile.

And Carnegie was no piker when it came to giving. By the time he died, he had given away 90% of his wealth (equivalent to $4.5 billion today) with the remainder to be distributed by others.

In Rush’s parlance, Carnegie fed many people via both greed and charity. By creating the heart of what became the most valuable company in the world, Carnegie provided food and shelter to tens of thousands of workers around the world and hundreds of thousands of family members. Whether you call it greed or self interest is immaterial. It supported hundreds of thousands of people and it gave Carnegie the resources to give to charity. Carnegie’s giving did not simply feed a man for a day. On the contrary. He wanted to prepare recipients to feed themselves for a lifetime. The majority of Carnegie’s giving came in the form of financing universities and libraries around the world where men could improve their lot in life through education. His was a gift, but he required something from the recipient in order to take advantage of it. Be it studying or reading, the recipient of Carnegie’s largesse was involved in the improvement of his own condition.

At the end of the day, as usual, Rush was right. The good Carnegie was able to do was driven by his pursuit of his own self interest. Same deal with Gates, Rockefeller, Ford and even Mark Zuckerberg. The result was that they improved the lives of their workers, their customers and the recipients of their gifts… but it all started with a profit motive. And it’s true on a national scale as well. America became the breadbasket and economic engine of the world through the pursuit of profit. That profit motive and the success it created allowed the United States to become by far the most generous nation in the world. But the same thing holds true here, people around the world have benefited far more from Cyrus McCormick’s invention of the mechanical reaper, the American innovation in the early auto, energy and transportation industries and Silicon Valley’s silicon and cyber advances than they have from any charity that was ever given by anyone anywhere.

While charity has its place in the world, free markets and capitalism are the keys to true improvement in the condition of man. They provide the opportunity for investment and innovation to ameliorate most problems on the planet. Not all, but many. If one’s goal is to help a neighbor, a friend or someone across the planet survive a disaster or get through a difficult moment in their lives, charitable giving is the perfect solution. If however one’s goal is to lift a family or a community or a country out of poverty, do what you can to help them participate in capitalism and a free market economy. That’s where long term, sustainable economic advances come from. Now that’s a gift that will pay dividends for everyone involved.

Iraq will be Barack Obama’s Vietnam

2011-12-20T04:31:00.000-08:00

Iraq will become Barack Obama’s Vietnam. Not in the boogieman sense that the left has been using the Vietnam War for the last 40 years where every American use of force is the “next Vietnam” but rather in its aftermath.

The Vietnam War ostensibly ended in ended in early 1973 with the signing of the Paris Peace Accords. The agreement was based upon an agreement by all sides to stop hostile activities and for American troops to depart. The Americans would continue to supply the South Vietnamese military. In addition, the SVN leadership was explicitly assured that were the North Vietnamese to resume hostilities the United States would begin bombing Hanoi and other targets in the North.

Unfortunately for the South Vietnamese, the promises of arms and support were mirages. In 1974 Congress cut military aid to Vietnam from $2.3 billion to $1 billion and then in 1975 to $300 million. Thanks to the Democrat’s Case-Church Amendment, when the North had resupplied and resumed hostilities, the promised US bombing never came. In April 1975 Saigon fell and the South surrendered.

Then came the nightmare. Upwards of a million South Vietnamese found themselves in prisons, “re-education camps” or other tropical outposts where they were treated to starvation, torture and murder. Hundreds of thousands more braved the oceans in order to escape, a quarter of them never reaching shore. The effects of this nightmare reached into Cambodia and Laos as well.

And now there is Iraq.

The war in Iraq was obviously far different from the one in Vietnam. Unfortunately however, the aftermath may be similarly unpleasant.

While Iran will not invade Iraq anytime soon, the country could still become a vassal of the ayatollahs. If Iraq escapes that fate it may well collapse into a civil war that eventually draws not only the involvement of the Iranians, but of the Saudis, the Turks and other neighbors as well. Oh, and, yes, perhaps eventually the Americans again.

However one feels about the war in Iraq in the first place, the manner of the exit ensures one thing, that the American blood and treasure spent toppling Saddam Hussein and seeking to establish a viable democracy in the Middle East will likely be for naught.

Not that Saddam Hussein will be coming back anytime soon, he won’t… but the country he once ruled will likely become a basket case or a failed state.

The writing on the wall has been there for years. Candidate Obama had been a critic of the Surge and President Obama’s only priority in Iraq seemed to be leaving.

Iran was paying close attention. Although they had been heavily arming insurgents and Shia militants during the dark days of 2005-2007, by 2009 their efforts had largely been defeated with the establishment of a fledgling but credible Iraqi government infrastructure.

However, the national elections of 2010 opened the door to Iran once again. Barack Obama was inexplicably a proponent of a laissez faire policy in reference to the dysfunction in the formation of the Iraqi government following the 2010 elections. To anyone looking (and there were many) it was clear that the United States was disengaged and focused on wrapping up the operation.

Such chaos invites the efforts of a strong horse. Iran was willing to play. With an ambiguous constitution and a Chief Justice carrying Prime Minister Maliki’s water, the Iranians became the power brokers behind the new government, forcing Mr. Maliki into a coalition that included the Sadrists, erstwhile insurgents led by cleric Muqtada al-Sadr. This was only possible because of the vacuum left by the Obama administration. Had the Iraqis been confident that the United States would be standing with them until they could stand on their own, there would have been no vacuum for the Iranians to fill.

As things stand today, Iraq sits on a precipice of disaster. Within the last three months terrorist attacks have increased, sectarian infighting has escalated and two of the country’s eighteen provinces have sought semi-autonomous status, seeking to enjoy the autonomy the Kurds enjoy. Other provinces will surely follow. For a country with a weak central government and deep divisions amongst its population, such a centrifugal force is not exactly helpful. This will be particularly problematic as the national government seeks to collect and distribute oil revenues, bolster the power grid and perform other traditional tasks. Apart from the growing separatism at the local level, the federal government is a patchwork of alliances, most of which are held together by Iranian influence. That influence comes in various forms, from their covert (but hardly secret) support of terror groups Khataib Hizballah and Asaib Ahl al-Haqq, who are not only responsible for killing US troops but for targeted assassination across the country, to their overt economic, diplomatic and religious ties. As if to put a cherry bomb on the top of this powder keg, the day after the last American troops left the country, the Shiite-led government issued a warrant for Vice President Tariq al-Hashemi, the country's highest ranking Sunni official, on terrorism charges.

Of course it did not have to be this way. American Military planners had long sought to leave a force of between 20,000 to 30,000 troops to provide continued security, run counterinsurgency operations and to focus on training of the Iraqi military. Most analysts believed that number was the minimum number necessary to maintain many of the hard fought gains won over the last four years.

While 20,000 troops may sound rather small in terms of maintaining gains achieved in a country of 30 million people, the message they would have sent to the Iraqis, and equally importantly, to the Iranians, would have been crystal clear: The United States will not allow a democratically fragile Iraq to become an battleground of the Middle East or an Iranian puppet.

That however was never Barack Obama’s message. His campaign would later reveal his message: “Ending the War in Iraq: A Promise Kept”

For some perspective, one might observe that leaving sizable troop levels in a theater for a period of time after a conflict in order to maintain hard fought gains is nothing new. A quarter century after the end of WWII there were 260,000 American troops in Germany and today, sixty years after the Korean War there are 30,000 US troops in South Korea. Obviously the Korean peninsula and Western Europe are different than Mesopotamia, but the notion remains that leaving troops to midwife a long term positive outcome is far from foreign. At least to most people not named Barack Obama.

Instead, the message the Iraqis and their neighbors received from the United States was one of detachment driven by a President with little interest in anything other than ending “Bush’s War”. Whereas Bush talked with Prime Minister Maliki on a weekly basis, President Obama spoke with him rarely and not at all between February 13 and October 21 of this year, critical days in the period leading up to the end of the American presence in Iraq.

After months of doing nothing the administration finally proposed in August of this year to leave 3,000-5,000 troops, far below what most believed was necessary to secure the peace. Those numbers, far too small to fulfill its mission did prove helpful to the administration however: it provided a fig leaf behind which it could hide its retreat. This fig leaf came in the form of a lack of immunity for American troops on Iraqi soil. While Mr. Maliki and other members of the government may have been willing to go to the mattresses to secure such immunity for a substantial force that demonstrated a serious American commitment to Iraq, they were not willing to do so for a token force that would provide little support or security. Even that fig leaf was too small to provide true cover because the administration could have easily put any forces in Iraq on the diplomatic rolls, which would have provided such immunity.

At the end of the day, Iraq will be Barack Obama’s Vietnam in the sense that not only will most of the hard fought gains be lost, but there will be thousands who will pay the price for his choice, starting with the innocents who will be caught in the sectarian crossfire. They will not be the only ones however. So too will a price be paid by neighbors who fear an emboldened Iran as well as freedom advocates across the region who might have sought replicate Iraq’s success and build secular, democratic governments. And then there is the world’s confidence in the United States as a long term ally in the fight for regional stability and a bulwark against Iranian intervention.

Of course all of this comes on the heels of another futile round of sanctions seeking to keep the Iranians from developing or delivering a nuclear weapon. Barack Obama has certainly conveyed a message of strength and stability to the region. “Ending the War in Iraq: A Promise Kept” Indeed.

Tea Party vs. the GOP establishment - Begging for a brokered convention...

2011-12-05T02:45:00.000-08:00

For much of the last three years, I, like so many others who were so despondent after the election of 2008, assumed that the election of 2012 was finally going to provide the American people with a real choice of philosophies.

On the one side you have President Obama and the progressive / fascist utopia. (Fascist in the economic sense – where private property remains, but government dictates its usage – rather than the Nazi anti-Semitic / nationalist sense.) This utopia is where government plays the role of caretaker of the nation, where government tells citizens what they can and can’t do with their property, what they must buy and where they must invest, where unions have the power to coerce both government officials and private corporations that pay their members salaries.

On the other side the Tea Party was going to make sure that for the first time in 30 years a conservative nominee would be the standard-bearer of the Republican Party. The platform would include radically smaller government, less intrusive government, and lower taxes coupled with a less complicated tax code – maybe even the Fair Tax – and a strict adherence to the 10th Amendment. Life was indeed going to be good again and prosperity would soon come roaring back.

Given the failure of everything progressive, from welfare to education to the USSR to practically the entire European continent, Americans would finally be given the choice between continuing down that well trod path to failure and a going down that forgotten path of economic liberty that was the foundation of American prosperity since the revolution.

Somehow, somewhere along the road leading to that fateful, Solomanic fork in the road, something went wrong. Not on the left. No, President Obama has indeed been as progressive as most of us feared, and in some cases far worse. Actually, the problem is on the right. Where many of us were hoping that the standard-bearer of the GOP would be a clean, if not perfect, conservative, increasingly it looks as if the nominee is going to be someone other than that.

In the one corner we have Mitt Romney who to this day refuses to renounce Romneycare, the Massachusetts disaster that spawned Obamacare. He also was an early supporter of cap and trade, was gullible on global warming, opposes a flat tax or the Fair Tax and shares an unhealthy affinity with Barack Obama for class warfare.

In the other corner we have Newt Gingrich, the guy who sat on a couch with Nancy Pelosi and told us to pressure our leaders to combat climate change. Although he finally admitted that was one of the stupidest things he ever did, there are other candidates for that title. He trashed Paul Ryan’s less than radical tax plan as “conservative social engineering”, supported the individual mandate in healthcare and now wants to harness local boards to determine which illegal immigrants should be allowed to pursue a “Path to legality”. I have to wonder how effective that might be in sanctuary cities around the country like San Francisco, Austin and Denver. As if all of that were not enough, after taking almost $2 million from Fannie & Freddie and praising their work and the GSE model itself, he now wants us to believe that the only thing he did for the money was tell them their businesses were going to fail. Really?

There are of course others in the race and they too are imperfect, but at least with Perry and Bachman you know they are true conservatives mostly dedicated to a smaller government. Unfortunately for the two of them, their campaigns barely register a pulse when it comes to the polls.

At the end of the day one has to ask, what happened to the Tea Party revolution? How is it possible that the two men leading the race for the 2012 GOP nomination are big government, crony capitalist chameleons who are far less inclined to upend the Washington applecart than work with the people driving it? Why are not the leading GOP candidates shouting from the rafters that they will radically slash government spending and regulation, that they will champion a flat tax and that they will impose a strict adherence to the Constitution, particularly the 10th Amendment?

Despite the best efforts of the media and the Democrats to paint the Tea Partiers as racist rubes and the Occupy Wall Streeters as noble sophisticates put upon by the evil capitalist system, the American people recognize the truth. The fact that the PR field is so heavily tilted towards OWS, yet citizens still have a more favorable view of the Tea Party, tells you everything the GOP needs to know about the coming election. If they would simply run a candidate who proudly articulates basic conservative principles, the next election would result in the country being freed from the tightening progressive noose around its neck. Without such a candidate, with just another standard-bearer Americans can’t distinguish from the big government GOP they’ve come to know, Barack Obama may indeed triumph.

With Gingrich and Romney sitting in the pole positions, I find myself pulling for a brokered convention that results in an opening for someone other than Frick and Frack to take the nomination. Someone like Sarah Palin, or even the forgetful but conservative Rick Perry. Sure that’s an unlikely scenario, but at this point the traditional route has brought us two paper tiger conservatives leading the pack. The Tea Partiers and the country deserve an opportunity to make a clear choice between progressivism and conservatism. Let’s hope that somehow the GOP can figure out how to give that to them. Otherwise it may be another four years of hoping for change.

Looking to "experts" - How Herman Cain can revive his campaign for the GOP nomination

2011-11-28T02:54:00.000-08:00

Herman Cain is the only person in the GOP field who has significant experience running a private company from the perspective of an operator. Yes, Mitt Romney has significant experience in business, but for the most part his experience is as a consultant or an investor rather than as an operator. When I say operator I’m talking about being in charge of making payroll, worrying about regulators – local, state and national – setting policy and executing, all while inspiring employees to succeed and earning a profit. Those are the kinds of things that Herman Cain has done – more than once. He revived a moribund Philadelphia Burger King unit with 400 floundering stores. He slashed the fat from a money losing Godfather’s Pizza chain and returned it to profitability… and eventually bought the company himself.

As an operator Cain was on the front lines of the single biggest threat to the economic health of the United States today: Government regulation. As such, Cain understands exactly what needs to be done to free up the nation’s entrepreneurial spirit. Of course he’s also led a major national organization, the National Restaurant Association, sat on the board of Fortune 500 companies like Nabisco and Whirlpool and spent seven years serving in various capacities (including Chairman of the Board) of the Federal Reserve Bank of Kansas City.

Cain’s hands on experience actually running businesses and his oft articulated dedication to a constitutionally limited government make him the best choice amongst the current GOP lineup to lead the country out of its economic malaise. Not to forget 9-9-9 as well. Unfortunately for him however, while paring back government to spur innovation, investment and prosperity is the single most important job of the next president, it’s not the whole job. As such I have two main concerns about Herman Cain today.

Firstly I’m troubled by his lack of big picture thinking on foreign affairs and national defense. From his “listen to the experts” approach to Iraq and Afghanistan to his apparent confusion about Obama’s Libya policy to his lack of clarity the Palestinian “Right of Return”, one is not left with a feeling of great confidence. I might suggest however that the “out of his league” impression he leaves might not necessarily be fatal. Given that the next president’s single biggest priority must be a “laser focus” on reviving the American economy, having someone comfortable in international affairs is not a priority. But having someone competent with a strong team is. A coherent policy on foreign affairs is vitally important in a global economy. At the same time, with an ever changing cast of rouge characters around the world, national security must be an integral part of the foreign policy equation. As such, Mr. Cain could ameliorate the reservations many have about his international relations aptitude and skillset by immediately recruiting John Bolton to lead his foreign policy team and giving him a supporting cast made up of people like Max Boot and Dinesh D'Souza.

I’ve never believed that a presidential candidate needs to know the names of every leader and would-be leader in every country around the world. They must however have (and articulate) a relatively clear general approach to foreign affairs and have a basic familiarity with the major issues of the time. By harnessing such a clear thinking, well respected and no nonsense champion like Bolton to drive his foreign and defense policies, Cain would in one decisive moment demonstrate his intent to field a serious foreign policy team that would implement a robust and American centric (as opposed to an international or global centric) foreign policy that would both comfort allies and put enemies on notice. A John Bolton led team would immediately give voters confidence that while Cain may be weak on the specifics, he understands the importance of foreign affairs and defense policy to the job he is seeking and signal his administration’s intent to give them the level of attention and resources they deserve.

The second concern with Cain has to do with the harassment accusations. As I wrote at the time, I doubt the veracity of the charges. My concern however is that given more than a week’s notice the campaign seemed to be so unprepared once the issue became public. A week’s notice and they seemed befuddled. That falls on Mark Block, Cain’s campaign manager. As does his setting up of the disastrous interview with The Milwaukee Journal Sentinel a couple of weeks later. Together these two self inflicted wounds may have sunk the Cain campaign. As such, if the campaign is going to find its footing again Mr. Cain should replace Mr. Block, or at a minimum partner him with someone like Dana Perino who’s better attuned to the what a presidential candidate should and shouldn’t be doing and saying out on the campaign trail. Loyalty is laudable, but when that loyalty endangers the raison d'être of the endeavor in the first place, it becomes a liability. The greatest thanks Mr. Cain could pay Mr. Block’s efforts would be to become President Cain rather than candidate Icarus who fell from the sky without ever achieving his objective.

Mr. Cain frequently talks about looking to “experts” on a wide variety of issues. Certainly a multitude of said experts are necessary to lead a nation of 300 million people, administer multi trillion dollar budgets and operate in an international arena of constantly shifting alliances and relationships. Candidate Cain asks the American people to have confidence in his ability to draw on the expertise and skills of others to supplement his knowledge and experience. He could earn that confidence reaching out and harnessing the skills of such experts today to help him become President Cain. If he can’t engage experts now, to help him revive his campaign and help him win the presidency in the first place, we’re probably better off not seeing how the policy would have been implemented once he entered the Oval Office.

Commerce Clause frivolity: Obamacare, NASA and your unwed pregnant daughter...

2011-11-21T04:40:00.000-08:00

Two weeks ago the Supreme Court agreed to decide the constitutionality of President Obama’s signature piece of legislation, the Patient Protection and Affordable Care Act, better known as Obamacare.

In a surprising act of courage, the Court agreed to decide the divisive case in the midst of what will certainly be one of the most viscerally contentious elections in a century. To their credit, when they could have easily kicked the can down the road and waited until after the election to take the case, they did not. Not only did they accept the case, but they allotted an unprecedented 5 ½ hours of oral argument for it. They fully recognize that their decision will have significant political implications. Not in the sense that it will sway voters one way or another (which it will certainly do) but in that it gives voters the opportunity to take into account the consequences of their 2008 votes when they walk into the booth in November.

However the Court decides, the consequences of that election will be laid bare. It’s not often that voters get such a clear, definitive beginning, middle and potentially end of such a consequential piece of legislation – at least from a legal perspective – within one election cycle.

The central question in the case is a relatively straightforward one: Does the federal government, under the Commerce Clause, have the power to force Americans to purchase health insurance?

Article I, Section 8, Clause 3

(Congress shall have Power) To regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes;

The foundation for the administration’s argument that it does indeed have that power lay in a case handed down by the Supreme Court in 1942, Wickard v. Filburn. That case gave the stamp of approval to the Agricultural Adjustment Act of 1938, which allowed the federal government to regulate economic activity:

In 1940 an Ohio farmer, Roscoe Filburn grew more wheat than the government allotment allowed. They fined him. He sued, stating that his wheat was for his own use on his farm and therefore was beyond Congressional reach. In a legal gerrymander that would put any politician to shame, the Court decided that as Filburn’s exceeding his quotas would result in him buying less wheat in the local markets, which in turn led to less wheat traded in those markets, he was impacting interstate commerce; therefore Congress did indeed have the power to limit his production.

Twisting Fillburn’s already tortured logic, the Obama administration has decided that now it can force all Americans to purchase healthcare. The why is that society has to pick up the tab when uninsured people go to the emergency room. The how is where Filburn comes in. By virtue of the fact that the money people spend on healthcare for the uninsured (through higher taxes and higher insurance premiums) cannot be spent to purchase goods and services they might otherwise purchase, healthcare therefore impacts interstate commerce. As such, Congress has the power to regulate healthcare and can compel people to purchase health insurance.

That is the logic the Democrats used as they force fed Obamacare down the throats of the American people.

If this logic is acceptable, the question becomes, is there literally anything the government cannot do? For example, perhaps a future Congress might want to ban premarital sex? What? No way! Really? How? Here’s how: The United States spends hundreds of billions of dollars every year capturing, trying and keeping criminals locked up. Seventy percent of prisoners come from households without fathers. Given that the single biggest contributor of kids growing up without a father is out of wedlock births, the most straightforward way to ameliorate that problem is simply banning premarital sex. As the progeny of premarital sex drive expenses in the criminal justice system, which in turn reduces the amount that can be spent on airline tickets or pencils or hotel rooms, or bingo games, Congress can legislate it.

Sure, that sounds like a stretch, but then the history of the Washington borg is legion. The EPA was set up to clean the air and water and now it fines farmers for spilling milk and wants to regulate the stuff we exhale. The Department of Energy was established as a result of OPEC bringing the country to its knees with oil in 1973 and today it’s pretending to be a venture capital firm as it pours tens of billions of taxpayers’ dollars down politically connected green energy rat holes like Solyndra and Beacon Power. How about NASA? The National Aeronautical and Space Administration used to be about putting men in space and on the moon but today we pay Russia to send our astronauts into space and the agency’s number one job is to: “to find a way to reach out to the Muslim world and engage much more with dominantly Muslim nations to help them feel good about their historic contribution to science, math, and engineering”. Obviously the notion of banning premarital sex to save money on prisons is ludicrous, but based on Washington’s track record that doesn’t even matter.

The outcome of the administration’s logic suggests that there is nothing in our $14 trillion economy that could not be said to impact interstate commerce. Nothing. Growing tomatoes in your back yard rather than buying them in the supermarket; staying at home instead of going out to the movies; sewing the hole in a child’s pants rather than buying a new pair; sending your kid to a private or religious school rather than the dysfunctional public school down the street. If this expansion of the absurd logic of Filburn is allowed to stand, there will be literally nothing the government cannot make you do or keep you from doing. At that point there will be no freedom left in America. First to go will be what’s left of economic freedom, followed shortly thereafter by political and then religious freedoms. Once those are gone, how much is really left of America at all?

A trillion dollar hit job - who really wins from the Herman Cain scandal?

2011-11-14T05:20:00.000-08:00

Having spent three quarters of my adult life working in restaurants, I can tell you that I find the accusations against Herman Cain difficult to believe. Not that sexual harassment doesn’t occur in the restaurant industry, because it does. Rather, because the industry has no shortage of itinerant and attractive young women who would be more than happy to indulge Mr. Cain in whatever peccadilloes he might have. If Mr. Cain were prone to using his position to coerce women into sexual favors, which is exactly what Ms. Bialek is accusing him of, I cannot imagine that there would not be women coming out of the woodwork with stories of his antics. Frankly, he wouldn’t have even needed to use coercion. For a man of power and influence seeking to find willing partners, the restaurant industry would be the equivalent of shooting fish in a barrel.

Instead of credible, demonstrably true charges, what we have is a handful of women coming out with specifically non specific accusations of “sexual harassment”. And the problem is, there seems to be no way for Mr. Cain to escape the attacks. It’s like being asked “Mr. Smith, are you still beating your wife?” and you respond that you’ve never laid a hand on her but the headline the next day shouts “Mr. Smith says he’s no longer beating his wife.” The accusation alone is enough. Enabled by a pliant media, these women have been able to detour, if not derail, a promising political campaign.

Who might benefit from this? Primarily two groups: The left (read Democrats) and Washington insiders of both parties.

The left does not like Herman Cain for two reasons. The first is because he’s an unabashed believer in American exceptionalism. At the end of the day he believes that a man in America has the opportunity to succeed through his own efforts, regardless of their background or demographic characteristics. The second reason they don’t like him is that he has the temerity to believe those things while being black.

That latter bit is what really makes the Democrats nervous. The fact that Herman Cain is a black conservative who is a vociferous opponent of the entitlement state creates a potential fatal crack in one of their core constituencies, blacks. Blacks make up about 13% of the population and they vote Democrat in excess of 90% of the time – 96% of blacks voted for Barack Obama. To put that in perspective, if a candidate needs 50% of the total vote to claim victory and they automatically get 90% of the black vote, they already have 11% of their 50% right there. That means that of the remaining 87% of the population, said candidate need only attract 39% of the vote. That’s a pretty good deal for Democrats.

Herman Cain puts that math in jeopardy. By demonstrating that a black man can succeed in the United States without depending on affirmative action, without being a ward of the state, without being an agitator for redistribution of wealth, he shatters the myth propagated by the left that blacks are victims and cannot succeed without government help. Once they recognize that, that 90% Democratic foundation begins to crumble.

The veracity of this fact can be seen in the way that the left treats Cain. “He’s a black man who knows his place” or he needs to “Get off the symbolic crack pipe”. They are trying to demonstrate that he is not an authentic black, his story is an aberration and that his success is not the kind of success that other blacks can aspire to or expect from themselves or their families.

Therefore, his candidacy must be destroyed. It must not be allowed to succeed because if he were to convince even 20% of blacks to vote for him, President Obama and much of the Democratic machine would be toast. A Democrat party without its most reliable constituency would crumble.

At the same time, political insiders on both sides of the isle dislike Cain for a completely different reason. He seeks to upset their Washington metro apple cart. You know, the one that has the highest income level in the United States. The one that has the power to set the rules for the rest of the country.

The Herman Cain candidacy is potentially Armageddon for those people. As a conservative, Cain believes that the government should be limited to doing only those things it is constitutionally empowered to do, rather than all the things politicians and bureaucrats want to do. As such, he would likely clean house. He would likely slash, if not eliminate, major elements of the government bureaucracy, particularly in the areas of education and energy as well as environmental and corporate regulation.

To understand why this scares insiders so much, imagine the impact of his 999 plan. By streamlining and simplifying the tax code, by eliminating most exemptions, he would immediately gut the number of accountants America needs, as well as making tens of thousands of IRS employees redundant. That proposal alone would immediately save Americans’ hundreds of billions of dollars in accounting costs. Thousands of accountants and IRS types would have to find productive jobs elsewhere. Now imagine that same level of efficiency brought to the Departments of Education, Energy, HUD and HHS.

Simply put, Herman Cain is an outsider to the Washington insider cabal. That cabal, which includes bureaucrats, lobbyists and politicians of both parties, is shaking in its boots. The prospect of a businessman not accustomed to the built in inefficiencies, the go along to get along mentality that permeates Washington, scares those people to death. Unfortunately for them, Cain worries about the effects of government employees and regulation on the American people and the American economy, not the other way around.

His goal is to remove the yoke of government from the backs of the American entrepreneur so that prosperity can return. If you are a lobbying firm who collects hundreds of millions of dollars a year to influence government, you don’t want to see someone elected who might sink your ship. Same thing if you’re a bureaucrat living in Mclean Virginia and making $150,000 a year with rock solid job security. Same if you are a politician who sits on a committee that gives you power over 10% of the American economy. If you are part of that yoke on the neck of the American people, you don’t want to see Cain get elected and would do whatever is necessary to make it not so.

Herman Cain’s unorthodox candidacy and his outsider perspective presents a sufficient threat to both Democrats and Washington insiders that they will do whatever they must in order to get him out of the race. For the Democrats it’s their party, for the insiders it’s their power and privilege and for both it’s their basic survival. At the root, there are literally trillions of dollars are at stake. Every day we read about the most heinous of crimes being committed for far lower stakes, so why then does it seem so farfetched that this just might be an orchestrated hit job to sink the Cain campaign? Maybe it’s not so farfetched after all.

The Occupy Wall Streeters should put down their copies of Das Kapital and pick up this year's Forbes 400

2011-11-07T01:59:00.000-08:00

Back in 2000 or 2001 I read a piece in Newsweek or TIME that discussed flyers whining that they didn’t have enough storage space in the overhead compartment bins on airplanes. I remember writing a letter to the editor saying that the only reason that people had the luxury of being able to whine about such things was that flying had become so safe that flyers could shift their focus to the more mundane. Then of course September 11th came along and people started focusing on the basic reason planes exist… to get them from point A to point B in one piece.

The Occupy Wall Streeters are just like the people whining about the overhead compartments. These are the people who enjoy the fruits of the capitalist system in which they live – iPhones, Starbucks, Facebook, Twitter, Twinkies, Nikes, ATMs, MSNBC, not to mention adequate food, shelter, and transportation, yet want to destroy that very system. They vote for economic dolts in the Democrat party like Barney Frank, Nancy Pelosi and Barack Obama and then blame capitalism when they screw it up.

Not only do they have no clarity about what they want, but they are wrong about most of those claims they are making. Bankers may be SOBs, but they didn’t cause the financial meltdown, Congress did. Their college loans are so heavy because government drove up college costs faster even than the rise in health care costs, not because of the 1%. The fact that with degrees in hand they can’t find jobs is because of government regulation and tax policy, not because of big corporations.

These people could benefit from putting down their copy of Das Kapital and ask their local banker for his copy of the Forbes 400.

The annual Forbes 400 issue lists the 400 richest people in the United States, the uber 1-percenters if you will. Just to make it on the list this year you had to have a net worth of slightly over $1 billion. Strangely, this list of the most hated of the really hated 1%, includes stars in the Democratic constellation like George Soros sitting at number 7 with a net worth of $22 billion and Mark Zuckerberg, Sergey Brin and Larry Page sitting at positions 14-16. Oh, and of course there’s also Mr. Solyndra, George Kaiser, at # 31 with $10 billion and President Clinton’s buddy, Ron Burkle, at 107 with his $3.2 billion.

When you hear the Occupiers talk about the 1%, it brings to mind a banker or industrialist sitting in his office gleefully writing pink slips just before Christmas so that he can improve the bottom line and buy another Gulfstream with his bonus money. Of course at the same time he’ll find some loopholes through which he can avoid paying any taxes on the bonus he earned for firing all of those workers. As he walks to the limousine that takes him to his Connecticut estate each night, he doesn’t even deign to make eye contact with the passing workers upon whose backs his fortune was made, at least the part that wasn’t left to him by his father and grandfather.

It’s of course possible that that caricature could be found amongst the people who make up the Forbes 400. That, however, is not the story of the list. What is the single most important thing about the list? The fact that 278 of them are self made. Think about that. While you’ll still find a Rockefeller and a Ford on the list, 70% of the richest of the rich in the United States are self made. That doesn’t mean that all of them were born into poverty like Oprah Winfrey or started selling shoes out of the trunk of their cars like Phil Knight, but 278 of the 400 started out in families that would never have made it anywhere near this list.

And the question is, how did those people make their money? Did they steal it from hard working Americans in some dark alley somewhere? No. Did they set up a high tech printing press and start forging bearer bonds? No. Did they use the police power of the state to jail competitors and take their money? No. Most of those people made their money the old fashioned American way, they earned it. They figured out how to provide a good or service to Americans and people around the world at a price they were willing to exchange their money for.

Obviously, if you listen to the Occupiers, all of those services must have been in banking, where the little guy has no alternative but to put their money in Wall Street banks. Not quite true. While 95 of the 400 made their fortunes in finance of one sort or another, there is a wide spectrum of other areas from which the fortunes came…

17 made their money in manufacturing… like Jim David of New Balance Shoes, a company that manufactures 25% of their shoes in the United States.

27 made their money in real estate… Like Bradley Hughes who built Public Storage into a $19 billion behemoth from a single self storage facility.

30 made their money in food and beverage… like Truett Cathy, who started Chic-Fil-A with one restaurant after getting out of the Army in 1946.

24 made their money in retail… like Bernie Marcus & Arthur Blank who started Home Depot (a company that employs 190,000 people) after getting fired for disagreeing with their boss at Handy Dan.

40 made their money in energy… like Harold Hamm of Continental Resources who started off pumping gas and working on cars.

Then of course there are the 49 who made their money in technology… like Zuckerberg, Moskovitz and Saverin of Facebook or Scott Cook who created Quicken after his wife complained about balancing the checkbook.

The members of the Forbes 400 made their fortunes by giving consumers, businesses and governments goods or services they were willing, if not happy, to pay for. They delivered food to stores and pizza to homes, they made shoes, software and toys, they built roads, bridges and buildings, and they entertained with movies, music and video games. And the funny thing about those 400 people is that they are only a fraction of the entrepreneurs and businesspeople in the United States who are providing those services. There are 22 million small businesses in the United States headed by people who are trying to become successful enough to make that exclusive club, and virtually every one of them understands that the way to get there is to provide customers with sufficient value to convince them to willingly exchange their hard earned dollars for their particular good or service.

The existence of guys like Bernie Madoff, Dennis Kozlowski or Kenneth Lay in no way diminishes the benefits that Americans (and people around the world) have enjoyed as a result of the efforts of the people in the Forbes 400 or the hated 1%. They may have been thieves and con artists, but none of them did a fraction of the damage done by Franklin Raines, Jamie Gorelick or Chris Dodd.

The question of the day is, would you rather have unaccountable bureaucrats and politicians using the police power of the government to decide the fate of the economy or would you rather let companies and entrepreneurs compete for your interest and money in a free market? While the Occupiers and their union and Democrat comrades would prefer the former, I'd take the latter 10 times out of 10. Things might not work perfectly, but they’d certainly work far better than if they were run by government apparatchiks.

A high IQ and a Harvard degree do not necessarily equal smart...

2011-10-31T02:57:00.000-07:00

As the American frontier was being settled, it was not uncommon for a man to be a jack of all trades and perhaps a master of none. Often a settler would have to clear his own land, build his house, hunt and grow his family’s food as well as provide protection of life and property. Frontiersmen (and their families) were, for the most part, self sufficient. That didn’t mean they were not part of a community that often provided support in times of need. Quite the contrary, but at the end of the day people understood that they were responsible for most of the things that needed to be done in their lives.

When the industrial revolution took hold and Cyrus McCormick freed the population from the yoke of the farm, the division of labor took off took off and with it the upward march of the American standard of living.

Today, division of labor is all around us. We have scientists, doctors, computer programmers, real estate agents, policemen, accountants, and hundreds if not thousands of other specialized occupations. And it’s not just occupations; it’s the basic parts of life: Someone else brings our food to the store or our order to our table, builds our cars, ensures we have clean water, generates our power, drycleans our suits, babysits our kids and invests our money.

Today we are the opposite of the frontiersmen, we are Jacks of few trades and (maybe) masters of one. Basically, Americans have outsourced much of their daily lives to others… and I don’t mean to China. They focus on what they do well, or at least what they do, and leave the rest to others. As a nation and as individuals, we are far more prosperous as a result.

The problem however, is that as Americans spend so much time focused on their siloed lives, they have outsourced their political fate to others. As a result the government has grown virtually unchecked for half a century and today the borg of government is the single most powerful player in the life of every American citizen. What’s worse, not only have they allowed the government to grow into a leviathan, but they have also outsourced the selection of that government to campaign managers who run slick campaigns showcasing vapid politicians who speak in platitudes and make empty promises. Or to a media that largely marches in lockstep as it challenges a hated conservative or deifies the candidate of its choice.

Today we have the logical conclusion of the American outsourcing of its political will. We have someone running the American government – and using it to try and micromanage the economy and the lives of every citizen – who is literally clueless on the most basic elements of economics. How is that possible?

Strangely, American voters have done in politics something they would never do in their own lives. Your uncle may be the best accountant in the world, but you’re unlikely to let him take out your child’s appendix. Your brother may be the best basketball coach on the planet, but you are not going to let him manage your 401K. Why then would Americans allow someone with few discernable skills beyond engaging an audience to run their government?

Barack Obama was a law professor, a rabble rousing community organizer and a 1/3 term US Senator. What in that CV indicates he is even remotely prepared to successfully navigate an organization that spends $3 trillion a year and impacts the life of every single American, every day? So he gets people excited at rallies and promises hope and change… Were Americans really that stupid? Yes. And it’s not just the average Joe. Most of Silicon Valley’s money goes to Democrats and went to Barack Obama. These guys, Mark Zuckerberg, Sergi Bren and the rest are pretty smart. What gives?

Because they mistake high IQ with smart, or in this case, a Harvard pedigree with someone equipped to run the country. While the two may overlap, they are not synonymous. Jimmy Carter may have had the highest IQ amongst modern presidents, and we all know how that turned out.

A voluntary division of labor is a compact. Everyone does what they do best and everyone wins. That compact only works if the civic framework that keeps it viable and voluntary survives. That framework is on its last legs. President Obama’s government wants to tell you who can provide your healthcare, where companies can locate their plants, how property owners can use their land and how much you can earn before the government confiscates most of your income. How far a stretch would it be for them to decide what job you are best qualified for and then streamline (or steamroll) you into it?

Americans need to step back from their televisions and for the first time in two generations remember the basic notion of what a presidential election is about. It’s about two things: Who will run the federal government and what should that government do.

A vote for a president is not like a vote for homecoming king. It’s not a popularity contest. It’s a vote for how much they want the federal government messing around in their lives.

At the end of the day a voter should concern themselves with a candidate’s philosophy – how he or she sees the role government in the lives of its citizens – and their track record of leading an organization. Throw in a candidate’s integrity and those two things will tell a voter everything they need to know about a presidential hopeful. They will tell a voter what a candidate wants to do and how likely they are to accomplish it.

If Americans want to continue enjoying the economic and social benefits provided by a division of labor, where they have the luxury of focusing on things they love or are skilled at, they had better figure out how to rein in government. In 2012 they will have that opportunity. Between Herman Cain, Rick Perry and Newt Gingrich they have three candidates who are less than perfect, but who philosophically all share the goal of shrinking the government and promoting individual responsibility. That’s half the battle right there.

Legacy: Was Steve Jobs a selfish son of a bitch?

2011-10-24T05:14:00.000-07:00

Steve Jobs passed away earlier this month with an estimated fortune of $8 billion. I have yet to see a single report about one single dollar that he gave away to charity. How is it possible that a person who was lucky enough to be born and grow up in the United States and take advantage of our laws, schools, infrastructure and patent protections could be so selfish? Compare his lack of philanthropic giving with that of other similarly rich types, past and present. Andrew Carnegie gave away virtually his entire fortune, over $350 million dollars during his lifetime – $5 billion in today’s dollars. John D. Rockefeller gave away over half a billion dollars over his lifetime – $8 billion in today’s dollars. Bill Gates has given away over $30 billion dollars and promised to give away most of the rest of his fortune while his friend Warren Buffett has promised to donate 99% of his wealth. The pair has created The Giving Pledge where billionaires pledge to donate a significant amount of their fortunes to charity. If all of these people can give this amount away, what was wrong with Jobs?

Charity and private giving has been a great force in America since its founding. Through churches and local organizations for those of modest means to building libraries, museums, or foundations for the wealthy, America has been a country where the successful and struggling alike look to support their communities as well as support the less fortunate around the world.

Apparently not so for Steve Jobs however… and charity’s not the only place he was tight. When he was alive he did everything he could to reduce his taxes. He used tax shelters to lower his tax rate from 35% to around 15% on millions. He put his real estate and other assets in trusts so they would escape the death tax.

Everywhere you look Steve Jobs was doing what he could to keep his own money. Not giving it away. Avoiding paying taxes. All while he’s taking advantage of everything America has to offer.

What’s wrong with a person who sees the misery going on around the world, from hunger in Africa to millions of poor here and does nothing to lend a hand? What kind of legacy is that?

When the robber baron Andrew Carnegie died his legacy was obvious. He had built thousands of libraries around the world, founded a university and built Carnegie Hall. By the time he died, JD Rockefeller had remade the face of modern medicine and created what was for years the largest charitable foundation in the world. Bill Gates is still very much alive, and he is remaking the face of charity. What kind of legacy is Steve Jobs leaving?

In 1977 he and Steve Wozniak introduced the Apple II, the first fully assembled personal computer. At the time the notion of a personal computer was an utterly foreign concept to 99.9% of the people on the planet. Term papers were still being written on typewriters. Math was still being done on calculators. Research was still done at the library.

In 1984 Apple introduced the Mac, the first personal computer to feature a mouse and graphic user interface. At the time most others still used the C: prompt.

In 1986 when he purchased Pixar, it was primarily a high-end computer hardware company with graphics as a side note.

In 2001 when Apple introduced the iPod, digital music was just becoming popular but most digital players were “big and clunky or small and useless”.

In 2003 when Apple introduced the iTunes Store the music industry was imploding and college students were being sued in their dorms.

In 2007 when Apple introduced the iPhone few people were able to surf the Internet on their phone and most competitors’ products were poorly designed and performed similarly.

In 2010 when Apple introduced the iPad, it essentially created the market, selling 5 times more than the rest of the devices combined.

Looking at all of this, the question to ask is, is Steve Job’s legacy going to be that he didn’t care about other people because he didn’t give his money away or let the government take it? Or is it going to be the fact that he changed the world and gave people something that is far more precious than money… more of their own time.

If you didn’t have a computer, how many hours a day would you have to spend (or would you have spent) in front of a typewriter typing, retyping or whiting out errors as you wrote a paper for class? Or doing computations with paper, pencil and a TI calculator? How much less efficient would your job be? Steve Jobs began and led the march that made the personal computer such an integral part of our lives, both personally and professionally. The value of that contribution to the improvement in the human condition is measured in the tens of trillions of hours and dollars rather than millions or billions. Add to that the value of the entertainment provided by iTunes & Pixar and the efficiency provided by the combination of mobility & functionality embodied in the iPhone and iPad and there are hundreds of billions more hours and dollars.

I never met Steve Jobs and from what I read he could be both generous and an SOB to those who knew or worked for him. Regardless of his personality or lack of a philanthropic gene, the fact of the matter is that he did far more for the world by running his business – and keeping the money generated from doing so – than he ever could have if he had “given back” every penny he ever earned or let the government tax him at the highest possible rate.

What might have become of Steve Jobs if today’s kleptocracy and regulatory straitjacket had kept him from starting his business in his parent’s garage with $1,200? Given that his return to Apple was driven by stock options and performance incentives, would he have returned if the “Occupy Wall Street” types had been setting tax policy? Or would he have decided to retire and travel the world?

We can’t know the answer, but we do know is that Steve Jobs created far more value for the world than he received in return. If he wanted to keep every single penny of it the world was still far better off. That’s how private enterprise works. It’s an exchange of ideas or products or services that others are willing to pay money for. In the end, although successful entrepreneurs and businessmen may indeed earn millions or billions, in almost all cases they do so by having provided customers or clients many times that in value. If you think Jobs was the only one, think about how much YouTube and Facebook have changed your life over the last five years. The founders of both are billionaires but the value of the benefits to the millions of ordinary citizens is many times that.

If the people at OWS or in the kleptomaniac ridden Democratic Party really wanted to jumpstart the economy and drive prosperity all they need to do is look at Steve Job’s life and give as many people as possible the opportunity to follow his path. Reduce taxes and regulations and just watch and see how many would-be Steve Jobs types come out of the woodwork.

Selfish son of a bitch? Don't know. Doesn't matter. A model for prosperity and improving the human condition… now that’s a legacy worth leaving.

Poor people will prosper under 999 - and so will the rest of the country.

2011-10-17T02:31:00.000-07:00

Herman Cain’s 9-9-9 tax plan is imperfect, but it’s by far the best plan on the table. As such, criticism of 9-9-9 comes from all quarters.

The left is unhappy that its egalitarian nature is the opposite of the progressive tax structure we’ve had for a century. I suspect however that it is not simple tax policy that drives their antipathy, it’s revenge. You don’t have to listen very long to one of President Obama’s “fair share” speeches to recognize it. Or watch much of the “Occupy your city here” demonstrations going on around the country to see the envy. The notion of those fat cat Wall Street bankers paying the same tax rate as a single mother of three who works two jobs to support her children is simply unacceptable.

The other main criticism from the left is that poor will pay more taxes than they do now while that rich will pay less. That is simply not true. Let’s imagine the most difficult of possible situations, where a family of four has an income of $25,000 a year, all in the form of untaxed government benefits. Let’s assume they spend every dollar they have every year. As it stands today, they would ostensibly pay no taxes.

In reality however if they spend their entire $25,000 income they are actually paying $5,750 in embedded taxes. According to the people over at FairTax.org, 23% of every dollar a consumer spends in the United States is due to federal taxes levied on employees, on corporate profits, in the form of excise taxes, etc. If that is the case, then when that family spends its $25,000, in reality, $5,750 of that is for federal taxes.

Under Herman Cain’s 9-9-9 plan that 23% would go away. Here’s an example: Let’s assume this family goes to the store and buys $100 worth of groceries. Under the current system, $23 of that total represents embedded taxes. If you remove that $23 from the total, then the cost of those groceries without taxes is $77. That 23% of embedded taxes would now become 9% as both profits and employees have a 9% tax rate. Therefore, the price on the shelf of the goods will now reflect the 9% embedded taxes and would cost $84. At the register the 9% sales tax would be added and the final price becomes $91.50. That’s 8.5% less than they would have spent under the current system.

If you expand the $100 to the family’s entire $25,000 income, they would actually end up spending $22,962 rather than their entire $25,000. In this case they actually end the year $2,037 richer than they do under the current system. While prices would not come down the day after 9-9-9 went into effect, competition would bring them down rapidly.

As for a family with an income that actually pays taxes, in almost all circumstances they come out ahead via the 9-9-9 plan. Read Ed Morrissey’s piece over at HotAir.com to compare the numbers with a family of 4 earning $50,000. In the few cases where the family does not come out ahead, they too will pay less in taxes as a result of the lower embedded taxes.

From the right criticism comes in the form of suggesting that it has no chance of ever getting enacted. This is a red herring. If conservatives take the White House and the Senate, it will pass easily. And they won’t need 60 votes to get it done as Harry Reid has decided that the nuclear option is no longer particularly toxic.

A more substantive complaint from the right is the very understandable notion that they don’t want the kleptocrats in Washington to have another tool with which to beat the American taxpayer about the head, i.e. a sales tax that starts out as 9-9-9 could easily become 10-10-10 or 25-25-25. I can certainly appreciate that as our current system started out with a top rate of 7% in 1913 but reached 77% by 1918.

That rate creep danger does exist, but the truth of the matter is that it already does. If the passage of the wholly unconstitutional ObamaCare demonstrates one thing, it’s that Washington thinks there are no limits to its power already. It’s only the Tea Party and a few Republicans who are keeping a sales tax from happening today. Remember Nancy Pelosi proposing the VAT not so long ago? Besides, Cain is proposing that a balanced budget constitutional amendment be passed, and I would recommend that he adds language that requires a 2/3 majority in both houses to increase taxes. As a cherry on top, the 9-9-9 plan would eliminate the ability of politicians to skew the tax code to help their friends or harm their enemies.

At the end of the day, the thing that is most compelling about the 9-9-9 plan is the economic growth it will stimulate. This growth comes from two directions. The first is the $350 billion Americans spend each year simply complying with federal tax regulations.(here and here) That is the equivalent of a boost of 2% to the economy, or a $1,000 per person that Americans would have to spend. The second part of that is the investment and jobs that would be created. Today the United States corporate income tax rate is 35%. If the corporate income tax rate went from 35% to the 9% included in the 9-9-9 plan, you would see trillions of dollars in investment flood into the United States as companies repatriated profits held overseas and sought stronger financial results.

To put that change in perspective, under the current tax structure a company that earns $1 billion in the United States pays $350 million in corporate taxes, leaving the shareholders with a net profit of $650 million. If the 9-9-9 plan were in place those same shareholders would instead enjoy a net income of $910 million, fully $260 million more, or 40% more money in their pockets. The resulting rate would be amongst the lowest in the world and would make the United States an investment magnet for investors and companies from around the world.

Then of course there are jobs. I began this post talking about how the poor would not be negatively impacted by 9-9-9. Actually they will be positively impacted. What is the single most powerful way to turn poor people into middle class taxpayers? More and better paying jobs, of course. With a 9.1% unemployment rate there is little incentive for companies to increase the wages of their employees. There are simply too many people willing to step in and fill the shoes of any disgruntled employee. At an unemployment rate of 4% the dynamic is turned on its head where employees are far better positioned to demand and get wage increases. As economic growth creates millions of jobs and as demand for workers begins to outstrip supply, the value of those employees increases and their compensation follows suit.

At the end of the day 9-9-9 is by far the best plan on the table. It’s easy to understand, it saves Americans money via lower prices, it means more investment, a growing economy, more jobs and higher wages. If Americans really want to return to prosperity, 9-9-9 will get them there. The question is, do they have the courage to finally walk away from incremental change and do something bold?

10 for 12 - How the GOP can win the Presidency and bring back liberty and prosperity

2011-10-10T03:43:00.000-07:00

One of the challenges in politics is going from the general to the specific. Practically every American wants the things most politicians promise they’ll deliver: more jobs, economic growth, good schools, less poverty, freedom, a coherent foreign policy, etc.

The more opaque a politician gets the better voters seem to like it. The poster child for this was of course Barack Obama in 2008. What in the world does Hope and Change actually mean? Virtually every American hopes for the things listed above, but in terms of a plan for actually addressing any of them, what does Hope and Change really mean?

Maybe this is it. From the leadership of the “leaderless” Occupy Wall Street movement we get some clarity: Free college tuition; open borders; a trillion dollars each spent on infrastructure and environmental repair; higher taxes on the rich; guaranteed living wage income regardless of employment; immediate across the board debt forgiveness for all; universal healthcare; and of course, prosecution of the ubiquitous Wall Street criminals. That sounds about right.

Hope and Change, whether the opaque 2008 version or the more clearly defined version above will probably not work in 2012. Not only does President Obama have an actual record to run against, but more importantly, voters realize that 2012 may be the most important election of their lifetime. As a result they are actually paying attention to issues and are curious about exactly what policies a politician will implement when they take office.

As such, Newt Gingrich is trying to resurrect the success he had 17 years ago with his new 21st Century Contract with America. Good luck to him. Noticing that few of the other GOP candidates have been as straightforward, I would like to help out in case they still looking for the right set of ideas.

Here is a list of the ten specific things a candidate could promise he or she will do out of the gate that will result in the economy turning around and subsequently taking off like a rocket as it ushers in a dramatic increase in jobs, productivity and prosperity. I call them 10 for 12…

1. Sunset all Federal legislation on the books (along with any consequent regulations) in eight years unless specifically reauthorized by Congress. Require every reauthorized and new piece of legislation to cite where in the Constitution Congress is given the power to pass such a law. All new legislation will automatically sunset in ten years unless reauthorized by Congress. Set this in stone by Constitutional Amendment if necessary.

2. Build a wall from Brownsville, TX to San Diego, CA. It’s not a perfect solution, but it’s a lot easier to police than thousands of miles of open land. Reform the immigration system to favor those with the skills, education and resources to find gainful employment or start a business. Allow any student who graduates from an accredited college to remain in the United States indefinitely if they either start a business or find employment.

3. Repeal the 16th and 17th Amendments. Eliminate the IRS and implement the Fair Tax. Close the Departments of Energy and Education, the FCC, the NLRB, NEA, PBS, Amtrak and dramatically slash the budget and power of the EPA. Outsource the operations of the Post Office. Sell or shutter Fannie Mae, Freddie Mac, Sallie Mae and get the government out of the home and student lending business. Sell stakes in GM and any other private sector entities.

4. Repeal Obamacare. Encourage states to allow interstate competition for health insurance and to experiment with a variety of health delivery systems. Repeal any federal legislation that hinders such competition.

5. Begin the process of eliminating all welfare programs. Set a four year timetable after which the federal government will be out of the welfare business. Provide job training for long term welfare participants to prepare them to stand on their own feet. Create a plan to empower churches and other organizations to provide assistance to those in need.

6. Implement loser pays n the federal court system and encourage states to do the same.

7. Open all unused federal lands, other than those designated as National Parks, to bidding for the purposes of exploration for and extraction of natural resources, or for conservation or development. Allow winning bidders to execute the contracts they paid for.

8. Curtail all federal subsidies. Farming, corporate, etc.

9. Eliminate Social Security for persons under 50. Establish self directed funds for individuals equal to their accrued contributions to date into the program. Introduce market competition into Medicare by creating a system similar to the one available to federal employees.

10. Define specific objectives to evaluate the continued presence of American troops in Iraq and Afghanistan. Once defined, either provide the necessary resources to accomplish such objectives or curtail the effort. Such objectives should take into consideration not only conditions in Iraq and Afghanistan, but regional objectives and national defense needs.

The consequence of these policies would be to throw the federal government into something of a whirlwind. At a minimum it would result in a flurry of activity by bureaucrats seeking to justify their continued employment... which means they could not spend much time writing new regulations. More importantly, Congress and the President would by design be forced to enter into a discussion as to the correct role of government. No longer would their hands be tied by laws that could never pass today. No longer would agencies be allowed to metastasize into a cancer on the economic freedom of Americans. At some point equilibrium would set in which balanced government rule making with forced re-evaluation of existing legislation.

The most important outcome, however, would be that Americans would once again understand they are free to focus on the pursuit of happiness without the constant fear of an ever encroaching federal government strangling their liberty while they are on that quest.

At least when a pirate takes your money, you know its going to create real jobs in the rum industry...

2011-10-03T05:11:00.000-07:00

How much do you earn per year? $25,000? $75,000? How about $150,000? Maybe a bit more, maybe a bit less. Whatever you earn, you probably wish your check was just a little bit bigger.

Many of us look at guys like Alex Rodriguez earning $30 million a year or Johnny Depp earning $50 million or Larry Ellison earning $130 million and wish we could exchange paychecks with them. But then of course we’d have to do what they do in exchange for those paychecks, something which most of us are unlikely to be able to accomplish. That is of course the beauty of free markets, where what you earn is relative to not just the value you bring to an organization, but the relative scarcity of potential replacements who can provide that same value. Take as an example a fireman. Firemen do things that everyone values. When you are standing there and your house is burning down, you value what a fireman does more than anything Angelina Jolie, Bill Gates or Dr. Dre will ever do. Let’s say the average fireman makes $45,000 a year in salary and benefits. Does Johnny Depp’s $50 million compensation mean that his job is 1,000 times more important than the fireman’s? No. The difference is that while Johnny Depp is one of only a handful of actors who can almost guarantee to make a $150 million movie into a blockbuster, there are tens of thousands of people who can and will train to become firemen. Although Hollywood is full of actors who might be willing play the role of Jack Sparrow, the discount DVD bin at Wal-Mart demonstrates clearly why Disney was willing to pay Depp tens of millions of dollars to reprise his role.

In a free market, as what someone earns is largely determined by the value they bring to whoever is writing the check, and how many other people can provide that same value, people can do a variety of things to increase their income by increasing the value they bring to their employer. They can get more or a better education. They can train at their craft to become more skilled. They can learn more skills so they can bring value in other areas.

Wherever your skills, education and efforts have landed you, you probably feel like you work pretty hard and earn your paycheck. Now imagine on having a job paying $95,000? That sounds pretty good. Now imagine that in exchange for that $95,000 you don’t have to actually do anything. Well that was the case with Solyndra. Not that the employees weren’t working hard and trying to create a successful company, they very well might have been. The problem is that the business they were in was simply not sustainable. As is seemingly always the case with “green jobs” everywhere, they can’t survive even the most basic elements of a competitive marketplace. Of course if an investor wants to put their money there, that’s their right. Invest in something you think has legs. Maybe you’re right, maybe you’re wrong. Give it a shot. That’s how free market capitalism works.

Unfortunately however, that’s not what happened at Solyndra. The Obama Administration decided that American taxpayers should tip the scales by putting up half a billion dollars for a company that spent $6 to manufacture a solar panel that it could then turn around and sell for $3. A four year old would recognize that was a recipe for disaster. Even a few people in the Administration saw that there might be a problem. Not only did they know it was problematic before they gave the guarantees, but they had to bend the rules half way through to let the company take all of the money guaranteed even after Solyndra failed to make it’s required payments.

Just in case you think the Administration was chastened and might have learned from its mistakes, think again. Just last week the DOE handed out another $5 billion in loan guarantees to other “green jobs” companies – one of whom is owned by Nancy Pelosi’s brother in law. In the case of one of those projects, the Crescent Dunes Solar Energy Project, the Obama Administration officials signed off on $737 million in loan guarantees for a project that will result in 600 construction jobs and 45 permanent jobs. That works out to $1.245 million per temporary job or $16,600,000 per permanent job. Those numbers are getting up into the Matt Damon pay range. Of course that’s not what those workers are going to be paid, but if Solyndra is anything to go by, they will be earning $100,000 or so per year. Good for them. I’m happy to see anyone earn whatever they can earn. The problem is, however, that the companies paying their salaries are not viable entities. They can’t survive without government support. And government support doesn’t come out of thin air. It comes out of your pocket in the form of taxes. Imagine if the government weren’t wasting these billions of dollars… your $75,000 paycheck might look like $80,000. Who would you rather have that extra $5,000 per year, you and your family or the people running the next failing “green jobs” basket case?

If the American people want to spend $5 billion investing in the future, I’d suggest they follow the path laid out by PayPal founder Peter Thiel rather than the one crafted by community organizer Barack Obama – i.e. more taxes and more money to floundering green companies. Thiel is paying a handful of students $100,000 to drop out of college and spend two years becoming entrepreneurs. They get a guaranteed paycheck, they get mentoring from Thiel and others in the venture capital world, but most importantly, they spend their time seeking to create, invent and develop technologies or products or services that will change the world.

To put this is perspective, the typical VC investment scenario plays out as follows: They lose money on seven out of ten investments. They break even on two out of ten. One of the ten is sufficiently successful that it not only pays back everything that was invested in it, but it covers the losses of the seven and makes money on the whole project.

If that kind of an approach were applied to the money the DOE is throwing down the “green jobs” ratholes, at least we’d have a chance to recoup our money and maybe find a technology that could actually survive in the marketplace… Of course the best thing to do would be to get the government out of the “investing” business all together, and let you keep your money. That $5 billion giveaway to the greenies works out to about $16 per person. If you had it back you might be able to go and see the latest Johnny Depp movie and help the studio pay his hefty salary. You might even have enough left over for a bucket of popcorn.

Palin or Cain and a government Americans deserve

2011-09-25T16:01:00.000-07:00

In a free society citizens deserve the government they vote for. As much as I might despise the everything the liberals stand for and are doing to this country, the truth of the matter is that they did not seize power in some coup d'état… except for maybe Stuart Smalley. Nor did they come to power legally and then change the rules once they got there as Hitler did. No, they were by and large voted into power promising to do exactly what they have done. The fact that most of America is unhappy with the way things are going says more about Americans in general than it does about the politicians themselves.

Although the dysfunction of government goes back for decades, 2008 provides a perfect prism through which to understand the failure of the American people. As most Americans now recognize, Barack Obama is a complete disaster as President. While this reality may have come as a complete surprise to some, the truth of the matter is that all of the signs were there for anyone who wanted to look. From being raised by self identifying Communists, to seeking out Communist professors, from spending two decades in Reverend Wright’s church to announcing his entry into public office in the home of two terrorists to being the point man for ACORN, all of this and much more was easily available to anyone who wanted to see it. Indeed, despite the mainstream media’s efforts to ignore or whitewash such aspects of Obama’s background, many Americans decided they were immaterial. He had after all been elected to the Illinois legislature and was a serving US Senator and he gave rousing speeches. Apparently that was enough to qualify him to lead the most powerful nation on earth.

To put this in perspective, that’s the equivalent of an NFL owner inviting a sports columnist to coach his team. Just because the columnist uses the lexicon of the game and knows how to criticize what others are doing doesn’t mean he has a clue how to actually run an offense, a defense or lead a team up of alpha male millionaires in their quest to outsmart and outperform 16 other teams made up of alpha male millionaires and led by professional coaches. Not only would the team get demolished, but anyone with a functioning brain could have predicted that outcome from the start. Appropriately enough Obama’s election in 2008 began America’s march to becoming the 2008 Detroit Lions... who went 0-16.

At the end of the day, Barack Obama being elected President of the United States is nothing more than a dereliction of duty on the part of the American people and is an example of the despicable state of the American body politic. To many Americans Barack Obama was an empty vessel into which they poured their hopes and dreams. And if he could assuage their white guilt in the process, even better! The problem is, he wasn’t an empty vessel. He was a filled to the rim with everything un-American and none of it was hidden from view. To not see it one simply needed to willingly avert their eyes.

It’s not a surprise that the Tea Party movement began even before Obama’s ineptitude became apparent. The election itself started to galvanize much of the population, particularly those who were dispirited by the GOP’s nomination of the squishy John McCain but pulled the lever for him nonetheless, just to watch the “electable moderate” lose. As President Obama’s incompetence became apparent and his anti-capitalist policies began to make it into legislation and the Federal Register, more and more Americans began to understand the threat that the left in general and President Obama in particular represent to the United States. On February 19th, 2009 Rick Santelli put words to the feelings that tens of millions of Americans were experiencing… viola’ the Tea Party was born.

The question for the GOP is, do they want the 2012 election to look more like 2008 or 2010? In 2008 they nominated a “moderate” who had been the darling of the media until he vanquished any real conservative opposition… what little there was. He then was morphed into a clone of the hated George Bush. In 2010 on the other hand, when voters across the country were given a slate of largely conservative candidates, the GOP picked up over 60 seats in the house and sent bedrock conservatives like Pat Toomey, Marco Rubio and Rand Paul to the Senate.

Is the GOP going to once again bring to the dance a “moderate who can win the general election” like Mitt Romney or are they going to go with a true conservative who can make a case to the American people that the time for meandering down the road to socialism and fascism is over? Although a moderate like Romney might put on the brakes, the reality is that what the United States needs is a full stop and a return to a Constitutional government. Let community organizations run social programs; Let states and parents manage education; Let citizens focus on creating wealth and prosperity as they pursue Life, Liberty and Happiness while the government focuses on securing the borders, adjudicating contract disputes and providing for national defense.

Disgust with Barack Obama and his party is not going to be sufficient to change the direction of the country. If the GOP is going to victorious it will have to field a candidate who clearly articulates a different path and who will be able to stand up against the media’s coming full court press in support of Barack Obama. Sarah Palin should be the one making that case, but unfortunately she is not running… yet. Herman Cain is a close second. Until Saturday night his chances were rather slim. Perhaps things have shifted… we’ll see if the $25 I just sent him helps.

However things go for Cain, the debate thus far leaves much to be desired. The back and forth about how RomneyCare differs from ObamaCare is a red herring. Arguing whether the Ponzi scheme that is Social Security should be called a Ponzi scheme is a debate more appropriate for a kindergarten class. They distract from the central message of lower taxes, less regulation and basically getting government out of the way so that people can live their lives. The government that takes the oath in January 2013 will indeed be the government Americans deserve. Let’s hope GOP gives them a candidate to lead that government that they can be proud of as well.

The left's 40% blue core... insanity, stupidity or religion?

2011-09-19T03:01:00.000-07:00

It’s still a year out from the election, but Rasmussen’s most recent poll makes one start to wonder. It shows President Obama at 46% of the vote against GOP frontrunner Rick Perry’s 39%. That was a flip from the previous week’s Obama 41% vs. Perry’s 44%.

The Perry part of that poll is not really of consequence. President Obama tends to perform about the same against various other challengers and against the “generic” Republican candidate. The ebb and flow of a weekly news cycle has an impact on the fringes, but not so much on the core. And that core is the thing that one has to wonder.

It appears that about 40% of the country makes up a core of blue… people who are wedded to their leftist philosophy as if it were a religion… they believe it will succeed despite all evidence to the contrary. From the economic malaise it has inflicted on the United States to the economic meltdown that is playing itself out in Europe to the wholesale abandonment of the leftist policies by governments from Beijing to Delhi to Hanoi. Despite the complete lack of a single demonstrable example of a sustained success of the Marxist / Keynesian / Alinsky philosophy, they still believe and it appears that virtually nothing anyone in the red corner can say can change their minds.

Today the aspirations embodied by their messiah are no longer just theoretical solutions and aspirational promises. This is not 2008 when the press could blame all of America’s woes on a reviled Bush White House. It’s not 2008 when Barack Obama could tell stories about how he plans on putting America back to work by rebuilding our infrastructure and creating green jobs. It’s not 2008 where Barack Obama could promise to make America respected again in the eyes of the world by closing Guantanamo and ending the wars in Afghanistan and Iraq. It’s not 2008 where Barack Obama could rail against George Bush’s “years of unprecedented fiscal irresponsibility.” On the contrary, in the summer of 2011 President Obama finds himself in the middle of a perfect storm of failure, yet it seems to have no effect on his followers.

The most recent issue is of course Solyndra. The solar panel company that was the poster child for the green jobs that were the key to fulfilling his campaign pledge to future generations that (his election) “was the moment when the rise of the oceans began to slow and our planet began to heal.” In 2009 the Administration gave the company $535 million in loan guarantees and in March of 2010 the President toured the company, declaring “the promise of clean energy isn’t just an article of faith.” Today the company sits bankrupt and taxpayers are out half a billion dollars. What’s worse for President Obama’s green jobs agenda is the fact that apparently each of those touted green jobs costs $5 million…

On the jobs front the President has just gone back to Congress and requested that they give him an additional $500 billion for a second stimulus program… because his previous $1 Trillion stimulus plan worked so well. The President suggested that his stimulus program (circa 2009) would bring unemployment down to 7.1% by August of 2011. In reality, his stimulus program did pass yet unemployment stands at 9.1% today. Fully two million more Americans are unemployed today than were promised by the President.

On the single most important issue of the day, jobs, President Obama has demonstrated not only that he is out of ideas, but that he wants to double down on the same bad ideas didn’t work in the past… and he wants to pay for the whole thing by raising taxes by $1.5 trillion. Unfortunately for him, things don’t look any better anywhere else. Domestically, inflation is on the rise, the economy is on life support and federal deficits are larger than at any time in history. Internationally, America’s leadership is once again so strong that the Palestinians are heading to the UN to ask for recognition despite US opposition, the Arab spring threatens to put Islamists in charge across the region, Europe is crumbling and Asian allies wonder about America’s commitment to the region as Taiwan is left twisting in the wind by the administration’s decision not to sell the island nation 66 new F-16 fighter jets for fear of offending the Chinese. Politically, the President’s leftist policies have so pummeled the citizens of New York that last week the GOP captured a house seat that had been held by the Democrats since 1923.

While the nirvana that was to be ushered in by Hope and Change has not materialized, it’s not because the administration has demurred from putting its policies in place. On the contrary, they’ve done so in most cases either by legislation or executive action. Despite all of this failure, a solid 40% of the electorate still supports President Obama and the discredited policies of the left. One wonders how is it possible that seeing all of this they could still believe? Then again, maybe it’s not so difficult to understand. A sign of a religion after all, is believing in something despite all empirical data that suggest it might not be true, or perhaps more accurately, the lack of empirical data that suggest it is true. The difference between a religion and the leftist policies of President Obama is that the former typically promises nirvana in the afterlife while the latter is supposed to be focused on this one. Nothing can prove Heaven doesn’t exist and therefore believers continue to believe. It’s called faith. History on the other hand, from FDR right up to Barack Obama, demonstrates clearly that the socialist, redistributive policies of the left simply do not work. Yet, the believers still believe, and vote accordingly. That fits Einstein's definition of insanity. In this case it might just be called stupidity.

The Democratic Party - A Picture America can do without...

2011-09-12T01:46:00.000-07:00

Sometimes when we look at events in isolation we see them as tragic or despicable or just lamentable. When we look at them together as a group however we come away with a completely different impression. They can seem to form a pattern or a picture that was hardly discernible when seen in isolation. The following is a collection of just such events.

Earlier this year Wisconsin Governor Scott Walker, seeking to save the state from financial ruin, set about to adjust the way the state dealt with public employee unions. The result was a demonstration of force and the threat of violence from the unions. Union minions took over the state capitol, intimidated legislators and in the end caused millions of dollars of damage to the capitol itself.

This year has seen a wave of flash mob attacks around the country where youths utilize social media to coordinate attacks on stores or random people. From Chicago to Dallas to Philadelphia to Washington these attacks represent something different. Many of the attacks were caught on tape. The thing that jumps out at one is that many of the criminals had smiles on their uncovered faces. They were literally having fun destroying or stealing others property or harming the innocent store clerk or random passerby. In a mirror image of the riots in the United Kingdom last month, these adolescents seemed to be sociopaths in the sense that they had no connection to civilized society.

The voters of Indiana’s 7th District must be proud. Their congressman, Andre Carson last week told an audience in Miami that some in Congress would “love to see us as second-class citizens” and “some of them in Congress right now of this tea party movement would love to see you and me…hanging on a tree.” The Congressman is accusing Tea Partiers and fellow Congressmen of being murdering racists. The most despicable thing about the Congressman’s comments is not that he said them in the first place, but that his comments aroused approval of the members of audience. In addition, so acceptable to Democrats are the Congressman’s statements that he was more than willing to defend them once they made it into the public square.

At this year’s Labor Day celebration in the Democrat run disaster that is Detroit, Teamster’s Union President Jimmy Hoffa said this: “President Obama, this is your army. We are ready to march. Let’s take these sons of bitches out and give America back to an America where we belong!” Hoffa was literally declaring war on the Tea Party. This was not delivered in the dark corner of a union hall somewhere but in front of thousands of people as well as the President of the United States, not to mention a number of news cameras. In his remarks that followed, President Obama not only did not distance himself from Hoffa’s remarks, but acknowledged him by name as one of the “Proud sons and daughters of Michigan representing working people here and across the country.”

Finally there are the longshoremen in Washington State. Five hundred members of the International Longshore and Warehouse Union stormed the Port of Longview last Thursday and destroyed the property of EGT, LLC, a company with whom they are involved in a labor dispute following EGT’s use of workers from a different union. What’s worse, the union thugs threatened a policeman and took six guards hostage for a number of hours. The union’s actions defied a federal restraining order issued the previous week against it after the union was accused of assault and death threats. While the union officially branded Thursday’s action a “wildcat” action over which they had no control, the day before the ILWU President Bob McEllrath and 18 others were arrested and vowed to return.

The thing that stands out about these various events is not that violence occurs or that people use despicable rhetoric to try and gain support for their unsupportable platforms or positions. No, the thing that stands out about them is that the people at the center of these various events seem surprisingly comfortable doing what they were doing or saying what they were saying in full view of God and Creation - not to mention the general public via some video cameras.

Few of the flash mobbing youths are concerned enough about anonymity to even bother to make the most rudimentary attempt at covering their faces. The Wisconsin Capitol had an air of Mardi Gras about it as demonstrators went about defacing state property in full view of news cameras from around the country. Jimmy Hoffa felt entirely comfortable offering the President of the United States his “army” in order to “take these sons of bitches out” in front of thousands of people and numerous cameras.

While criminals and manipulative politicians are not particularly unique or new, what is new is the brazenness with which they perpetrate their crimes or throw around demonstrably false charges or exhort their followers to violence. Other than the longshoremen who used violence under the cover of night, none of these people seem to be a bit concerned with a threat of sanction or consequence.

Individually these events are disheartening to say the least. Together however they are something more. Together these events form a picture of the modern Democratic Party. Government welfare programs, identity politics and union thuggery. This is a picture the United States can do without.

Unless America wants these anecdotes to become the norm, a change will have to be made. A century of failed policies should be enough to send the Democratic Party to the dustbin of history. Let’s hope 2012 is the beginning of the end for the party of big government, confiscatory taxes and anti-social behavior. Now that's a picture worth seeing.

Representation without Taxation...

2011-08-29T02:10:00.000-07:00

In the United States we take taxes very seriously. Indeed it’s in our blood. One of the key reasons for the American Revolution was taxation without representation. The Colonists did not like the idea of paying taxes to England without having a voice in how those funds would be levied or spent, i.e. they didn’t have representation in Parliament. In some cases they had representation in a state assembly, but the local legislature was in all cases trumped by the government in England.

Building on that initial connection between voting and taxes, in 1964 the 24th Amendment to the Constitution made it explicitly clear that no one could be barred from voting because of a failure to pay any tax. The primary target of the Amendment was Southern states who were limiting the rights of blacks by imposing a poll tax. The Amendment however did not ban simply poll taxes but rather any “other tax” as a bar to elections.

The goal of barring discrimination of black voters was of sufficient consequence that it deserved a Constitutional Amendment. The problem however is that by adding the words “or other tax” the government sowed the seeds for its own demise.

How? By permanently severing the relationship between those who finance the government and those who control it. Today, 51% of income earners pay no income tax at all, while the top 10% pay 70% of all income taxes. In addition, 30% of “taxpayers” actually earned money from the government in the form of refundable tax credits while those on welfare are not counted in the pool in the first place.

Progressives often respond that everyone pays Social Security and Medicare taxes. That is true – assuming someone is employed. In the federal system we have five primary forms of taxes:

First of course is the aforementioned Social Security. Social Security taxes are ostensibly taken from employees to fund (or ideally to supplement) their retirement.

Then there is Medicare, also taken from paychecks, which is intended to provide health insurance to those over 65.

Next there are excise taxes, taken with the specific purpose of supporting particular government programs and funded by the people who use those services. These would include things like gasoline taxes going to pay for transportation projects and airport fees to support airport maintenance and operations.

Then we have the corporate income tax, which is levied on corporate profits. These taxes go into the general fund and are intended to pay for the normal operations of the federal government.

Finally there are personal income taxes. These taxes are often the largest single component of the federal government’s revenue, and like corporate income taxes they are intended to fund the general operations of the government.

Here is the error of the progressive argument. The taxes paid by the bottom 50% of income earners (and those who earn no income) are for either retirement support or to pay for a used service, not the general operation of the government. As such, they are paying no taxes to support the actual functioning of the government. The fact that Congress has been raiding the Social Security “Lockbox” for decades does not change this fact. As long as the government is functioning, Social Security recipients will be the senior creditors on any government expenditures… and it is the people who pay the taxes who will have to make good on those IOUs.

Neal Boortz asks the question: should the vote of a welfare matron on the government dole with a five children be equivalent to the vote of a small businessman who pays $25,000 in income taxes and has 10 employees who support 20 other family members? The obvious answer would seem to be no. Certainly no more than it makes sense to allow your neighbor to negotiate with your boss how much of your salary you will be allowed to keep and how much your neighbor gets to take home in exchange for a kickback to the boss.

Is it now time to flip the colonist’s battle cry on its head? Should there be representation without taxation? Can the United States survive with a growing majority of her population contributing nothing to the running of the government, or increasingly, being net consumers of government largesse? This is not a new issue. "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship, then a monarchy." That quote is sometimes attributed to Alexis de Tocqueville and sometimes to Alexander Fraser Tytler. Regardless of its provenance, the notion is spot on. One need look no farther than today’s dysfunctional federal government to recognize the writer’s prescience.

Not only is the government taking all of its income taxes from the top 49% of income earners, but at the same time it’s borrowing trillions of dollars (that those same taxpayers will have to repay) to redistribute to tens of millions of others who are not paying any income taxes. The logical progression of this cleptocracy will be that eventually the most productive members of society will seek refuge in countries where they can enjoy the fruits of their labor. Where will the government look to then as it seeks to fund its redistribution of wealth?

Perhaps now is the time for another Amendment. One that states simply: “In order to be eligible to vote in federal elections a citizen must have paid federal income taxes in one of the previous three years.” Absent that, perhaps it’s time to consider a flat tax, or even better, the Fair Tax. None of these solutions will solve our fiscal problems on its own. Without spending cuts and a smaller, limited government the Grand Experiment is doomed. Creating an exclusive connection between voting and those who pay the government’s bills is a good first step however.

Conservatives want SMALL government, not NO government...

2011-08-23T02:55:00.000-07:00

Conservatives are constantly being accused of wanting no government. When we talk about wanting to eliminate things like the IRS, the Departments of Energy and Education or rein in rouge agencies like the EPA and the NLRB we are accused of wanting no government at all. That’s simply false. I don’t think I’ve ever heard a conservative speak about wanting to eliminate all government, or even the federal government.

Most conservatives understand that the absence of functional government brings chaos. In an environment where chaos reigns, at some point someone will step in and impose order. That person or group then becomes the de facto government. Perhaps the clearest example of this in recent history was the Taliban takeover of Afghanistan in the mid 1990’s. Although pockets of resistance remained, by the late 90’s the Taliban were firmly in control of the country. Most Afghanis didn’t like the Taliban, but they appreciated the relative order they brought to the country.

Here in America our problem is not a lack of government, but the opposite, too much of it. The strings of regulation end up wrapped around the wheels of the American economy and ends up clogging what might otherwise be a well oiled machine. An unfettered economy would not be flawless, but it would be far more dynamic than the straitjacketed one we have today.

To put this in perspective, take the IRS tax code. According to the Heritage Foundation, it will cost America just more than $400 billion in 2011 to comply with the tax code, and that does not include the cost of the actual taxes themselves. Given that the federal government will take in approximately $2.2 trillion in taxes this year, that means Americans will spend an additional 20% of their tax bill just trying to figure out how to pay the bill in the first place!

How is that even possible? Well, the tax code is approximately 72,000 pages long and it’s broken down into 750 subchapters. Imagine if you are a widget manufacturer with 10,000 employees spread out over 20 states. How many employees would you need to have on staff to make sure that that company was complying with the regulations written on every one of those 72,000 pages? How much time (read: money) would your accounting and legal staffs have to spend to ensure that everything you did was within the IRS’s guidelines? How much time would management have to waste evaluating what product or service to provide or what energy provider to choose depending on what provides the best tax advantage? How about deciding how employee benefits should be allotted between taxable and non-taxable to maximize employee compensation?

As difficult as scenario is, at least large companies can pay for the necessary accounting and legal staffs. Imagine you are a struggling businessman with 5 employees who has to choose between spending money on another employee to help him compete in the marketplace or on someone to decipher the 72,000 pages of the IRS tax code. The fact that an employer (or homeowner or parents of a college student or someone approaching retirement…) has to base many of their financial decisions on what the IRS rules are is bad enough, but for the rules to be so numerous and incomprehensible that it restricts productivity borders on criminal. And to put a cherry on top of it, all of that effort is spent just to figure out how to give the money to the government so they can spend much of it on stuff you'd never pay for if you had the choice.

Lucky for Americans, the tax code is not the only sign of a government gone wild. There is also the Code of Federal Regulations (the codification of the general and permanent rules published in the Federal Register by the executive departments and agencies of the Federal Government). The Code covers 163,333 pages, in 226 books. Those are the regulations that cover everything from that ticket on your mattress to the kind of gas you can put in your car to how long an airline can delay a flight to what can be labeled diet in the supermarket to the endless pages of directions and warnings provided with medicine bottles. Unless you are living in Ted Kaczynski’s summer home, not a day goes by that you do not cross paths with hundreds or thousands of these regulations. Like microwaves, you may not see them, but they are there nonetheless, impacting everything from hiring (or not, as the case might be) or marketing or investment decisions for everyone from Fortune 500 companies to neighborhood entrepreneurs.

The Competitive Enterprise Institute estimates that federal regulations cost Americans $1.75 trillion each year. That includes everything from environmental regulations to cable rates to the number of hours employees can work to months of tax compliance research. Add to that the $2.2 trillion Uncle Sam collects in taxes and you have almost 25% of our GDP being directly driven by government. Given the suffocatingly large and restrictive presence of government in our lives, is it any wonder that our economy is moving along at a dying snail’s pace? How many life saving medicines, technological breakthroughs, or even things as simple as more comfortable shoes have not been realized because we waste so much time and money focusing on regulation and compliance? At the end of the day conservatives don’t propose no government, just limited Constitutional government. We’d like to free up the American people to transform this moribund economy into a juggernaut of creativity, productivity, jobs and prosperity. That can’t be done while they are being strangled by government rules and regulations…

Jimmy Carter is Rick Perry's biggest fan...

2011-08-15T02:52:00.000-07:00

If Barack Obama were prone to conspiracy theories, he might think the last couple of weeks were part of a plot orchestrated by Jimmy Carter to salvage his own legacy.

First off the Democrats get the GOP to acquiesce to a debt ceiling bill that will result in the federal government raising taxes and increasing spending by over $7 trillion over the next decade. The immediate result is United States government debt being downgraded for the first time in history, something Treasury Secretary Tim Geithner stated unequivocally would not happen only the week before.

Soon thereafter the Fed looked into their crystal ball and decided that economic prospects were so bad that they had to take the unprecedented step of publicly stating that they would be leaving interest rates near zero until mid 2013. It seems as if Keynesians never see – nay recognize - failure, they simply see another opportunity to try and do the same thing over again, only each time a bit bigger.

Up on Wall Street things weren’t going any better. The Dow dropped 600 points the day after the downgrade and it has spent the subsequent two weeks on a daily triple digit roller coaster. All together the market is down almost 10 percent since the beginning of the month.

Those things are tough, but they don’t really add up to much of a conspiracy. Hey, the unemployment rate went down… from 9.2% to 9.1%, that can’t be a bad thing. Unless of course that decline is the result of more people simply throwing in the towel and giving up looking for a job at all. Add to that the decline in productivity and the increase in labor costs and things start to look rather bleak. All this while Obama’s approval ratings slipped to the lowest levels of his presidency.

Across the pond, as if to add gasoline to the proverbial fire, the socialist Mecca of Europe is crumbling from within. In the UK you have waves of chaos and riots perpetrated by youth who’ve spent their lives suckling at the public teat. The little rascals are ostensibly rioting against the police and government budget cuts, but seem to take particular joy in burning businesses and stealing jewelry and electronics. In Greece strikes and protests continue unabated while in Italy Silvio Berlusconi is fighting to keep his country solvent. It’s so bad over there that George Soros is recommending that Greece and Portugal pull out of both the EU and the Euro.

While it’s unlikely that Carter had a hand in any of this, the fact that the Consumer Confidence index is at its lowest level since he was President must give him some hope.

As if an economy on life support was not bad enough, on Saturday Rick Perry finally made it official and announced he was running for the GOP nomination to succeed Barack Obama.

If Perry gets the nomination it will set up a match Vince McMahon could only dream of. For the first time since Jimmy Carter occupied the White House, Americans will have a crystal clear choice between two philosophies that are diametrically opposed to one another.

In one corner you have Barack Obama who is leading the progressive charge that seeks to turn the United States into the train wreck that is Western Europe. In the other corner you have Rick Perry, an avowed 10th Amendment fan, a fierce advocate of small government and an unabashed believer in American Exceptionalism.

Rarely is it the case that voters have such a clear choice between philosophies of government. One need look no farther than the housing market to understand the consequences of the choice to be made. (Pick up a copy of Thomas Sowell’s The Housing Boom and Bust for a full telling of the tale.) California, one of the most unaffordable places to live in the country – not coincidentally the most regulated state in the Union – has seen massive bloodletting in the housing market as a result of the burst of the real estate bubble. Tellingly, despite the massive declines the state is still one of the most expensive places to live in the country. Texas on the other hand – largely due to its dearth of regulation – never experienced a bubble and its real estate has continued to appreciate throughout the recession. At the same time while California has an unemployment rate sits near 12% Texas’s is at 8.2%. And of course the state’s economic growth rate is almost double California’s and it has no income tax while California’s is amongst the highest in the country.

Barack Obama of course is not the Governor of California, he is the President of the United States. California is however the embodiment of everything Barack Obama holds dear, overarching regulation, high taxes, enormous social spending, an illegal alien and union paradise all under the watchful eye of an unassailable green lobby. Given his druthers Obama would indeed turn the United States into California.

At the end of the day, the progressive vs. freedom comparison that Rick Perry offers does not bode well for Barack Obama. No candidate provides a starker contrast of philosophy, and more importantly, actual results, than does Perry. (During the decade he’s been governor Texas has produced more jobs than the other 49 states… combined.) Of course he still needs to secure the nomination, but don’t be surprised if FEC documents show a large donation to the campaign chest from an anonymous donor down in Plains, Georgia.

Obamanomics vs. Reaganomics

2011-08-08T02:13:00.000-07:00

Last week, for the first time in history, US debt was cut to below AAA. That wasn’t supposed to happen. For months we saw President Obama and the media pillorying conservatives for inviting Armageddon by opposing the lifting of the debt ceiling without substantive cuts in government spending. When the “Hobbits,” as the Wall Street Journal dubbed them, were undone by the squishy wing of the GOP and we had our “grand compromise,” that was supposed to avoid a downgrade.

Just as many of the Hobbits had suggested, the grand compromise did nothing to allay fears about Uncle Sam’s finances and lo and behold four days after the deal was signed Standard and Poors reacted as any respectable rating agency would and downgraded our debt. (Perhaps they were trying to repair a reputation left in tatters after the debacles of Fannie Mae and Freddie Mac.) Now the country finds itself in the same position it might have otherwise except that now we have an ineffective debt deal that will not only allow spending to grow, but will allow taxes to rise.

In what one wishes was a man bites dog moment, but isn’t, Investor’s Business Daily reports that the Obama Justice Department is forcing banks to make mortgage loans to minorities with poor credit, no job and in some cases allow them to count unemployment and welfare as income upon which to base those loans. One might charitably ask if Eric Holder has been asleep for most of the last decade. What else would explain his wanting to double down on the exact problem that caused the current financial meltdown in the first place?

Keeping with the banking theme for just a moment, there are times when something happens that simply leaves you shaking your head. The way things work in a normal universe, banks earn money by paying depositors and then in turn lending out those same funds at higher rates to borrowers. Today however, in the Bizarro world of Obamonomics, banks are actually charging big customers for the privilege of holding their deposits. Apparently, the current economic prospects in the United States are so bleak that hundreds of billions of dollars are piling up in bank vaults across the country because so little investment / borrowing demand exists. And there we are almost at the heart of Obamanomics: When government makes it more appealing to pay your bank to hold on to your money than actually invest in businesses that could potentially create profits… and jobs. The only missing piece is when the government relieves you of the burden of paying those fees by simply taking your money.

In the event that one might want disagree with the Obamanomics labeling of this economy, let’s take a look at the last time we were in this situation, back in the early 80’s. During the first thirty months of the Reagan administration, unemployment went from 7.5% to 9.4%. During the first thirty months of the Obama administration the rate went from 7.5% to today’s 9.1%. At first glance President Obama seems to measure up pretty well to the Gipper. Not so much… Ronald Reagan came to office with interest rates sitting at 20%. Thirty months later they were still at 9.5%. Barack Obama has had a slightly different playing field, enjoying almost 0% rates since he took office. At the same time, while Reagan ran deficits of 3.5% and 4.7% of GDP during his first two years, Obama has run deficits in excess of 10% of GDP for both of his first two years. Then of course there is inflation. When Reagan took over inflation was sitting at 12% and thirty months later it had dropped to 3%. Obama on the other hand took office with an inflation rate hovering around zero and today it approaches 4%.

Democrats are fond of saying that George Bush left Barack Obama with the worst economy since the Great Depression. Anyone who lived through (or read about) 20% prime mortgage interest rates or had to wait hours to fill up their tanks knows that that statement is a lie. In reality, when faced with a much more challenging environment Ronald Reagan cut taxes, trimmed the nanny state (to the degree he was able – remember he wanted to get rid of the Departments of Education and Energy but his Democrat Congress would have none of that…) and was able to set the foundation for an economic juggernaut, all while never running a deficit in excess of 6.5% of GDP... and while winning the Cold War at the same time. Barack Obama on the other hand, with a staggeringly accommodating interest rate environment and no inflation has managed to bring the economy to a virtual halt by destroying the incentive for investment. Between the massive increase in government regulation and spending as well as the takeover of whole industries, Barack Obama has dealt a body blow to the free market system in this country. All while running staggeringly high deficits and a feckless foreign policy to boot.

Reaganomics was initially coined as a term of derision by the left. Years later, after Reagan brought the country out of the dark and set the foundation for a dynamic and robust economy, the term Reaganomics became a symbol of success. My guess is that thirty years from now when historians look back on the four years of the Obama administration the term Obamanomics will still be wearing its well deserved patina of dysfunction and failure.

$2 trillion in cuts? Washington's fantasy math vs. Tea Party "Hobbits"

2011-08-01T02:52:00.000-07:00

The past week has been a nothing if not confusing… From the President talking about his plan which mysteriously no one ever saw to John Boehner fighting off an attack from Tea Party “Hobbits” because they said his plan was almost interchangeable with Harry Reid’s. As of Sunday night the Boehner, Reid, Obama triad had cobbled together something that “cuts” federal spending by $2.4 trillion while raising the debt ceiling by about the same. Finally! Some clarity that makes this mess easy to understand for we simpletons…

Not so fast… Just a quick question… if federal spending is going to be cut by $2.4 trillion, why do we need a debt limit increase? In 2012 the federal government is expected to take in $2.2 trillion in taxes yet spend $3.7 trillion, $1.5 trillion more. Well, if you take $2.4 trillion in spending cuts out of a $3.7 trillion budget, you should have expenditures of only $1.3 trillion. That must mean that taxpayers should be getting $900 billion of the $2.2 trillion they will be paying in taxes back. Stupendous! Imagine, when people work together there is no limit to what they can accomplish.

Don’t spend that refund check just quite yet… Unfortunately, real numbers and accounting clarity are not Washington’s strong suit. The $2.4 trillion in savings doesn’t come from next year at all. It comes out of the projected INCREASE in federal spending over the next ten years. So, not only is this magical $2.4 trillion cut not come out of actual spending, it isn’t even cutting all of the expected deficits over the next decade.

Let’s see if I can explain this. The Congressional Budget Office has what they call the Baseline. That Baseline is basically what would happen over the next decade given current projections of spending and tax revenues. According to its January 2011 estimate, the CBO predicts that Uncle Sam will run a total deficit over the next decade of $7 trillion, or an average of $700 billion a year. Wow, $700 billion in deficits a year for a decade! Tax revenues must be expected to fall off of a cliff… Actually, no. They are expected to more than double to about $5 trillion in 2021 from $2.2 trillion this year. Unfortunately however, by 2021 the federal expenditures are expected to grow to $5.7 trillion from today’s $3.7 trillion.

According to Washington math, if the federal government decided to simply stop growing today, and spend only $3.7 trillion a year (which is what they will spend in 2011) for the next decade, that would be a $9 trillion spending cut. ($37 trillion in outlays vs. the CBO’s current $46 trillion projections.) Only in Washington can you spend the exact amount of money yet pat yourself on the back for cutting spending. And there is a bonus. If they were actually to do that, the federal books would go from a $7 trillion deficit to a $2 trillion surplus.

And just to put this in a bit more perspective, freezing at current levels would be enshrining the ludicrously high annual outlays that Barack Obama put in place – up from $3.1 trillion two years ago, which itself is up from $1.8 trillion when George Bush became president. In 2000, the United States had a population of almost 300 million people and a federal budget of $1.8 trillion. By 2011, while the population had grown 3% to 311 million people, the federal budget had grown by over 100% to $3.7 trillion. By 2021 the population is expected to grow by 9% to approximately 340 million people. The federal budget however is projected to grow 65% to $5.7 trillion. So in a period of a mere two decades federal spending will have grown from approximately $6,000 per person in the United States to $16,700 per person.

Let that sink in. By 2021 the federal government will be spending $16,700 for every man, woman and child in the country. They will also be collecting $14,300 for every person in taxes to pay for it and borrowing another $2,000. We’re almost there. How do things feel so far?

That’s exactly what the Tea Party congressmen were fighting against when they were pilloried by the Wall Street Journal, Bill Krystal and John McCain. They don’t want faux cuts that make for nice headlines but do nothing to rein in spending and begin to put the country’s fiscal house in order. They are not even talking about rolling expenditures back to what they were when Barack Obama took office, not to mention the glory days when Bill Clinton left us with a surplus driven by a “Peace Dividend”. No, they are simply talking about freezing spending where it is today and cutting the hundreds of billions of dollars in waste to finance the growth in critical programs.

Washington exists in a universe all by itself and it’s comfortable playing with make believe numbers and budgets. Unfortunately however the people who have to pay the very real bills for such chicanery can’t get by with make believe numbers and promises. The Tea Party nation recognizes that and sent a message to Washington in November to stop the tomfoolery. This budget deal demonstrates clearly that they didn’t get the message. One election however is rarely sufficient to clean out all of the deadwood from a rotting foundation. Keep that in mind the next time you hear some career politician or someone in the media wringing their hands about those Tea Party “Hobbits” who refuse to get on board and do things the way Washington has always done them. Hopefully after the 2012 election Washington will start looking a lot more like Middle-earth.

The Debt Ceiling and the Democrat's Xbox War on Poverty

2011-07-25T03:31:00.000-07:00

The debt ceiling talks fell apart on Friday as President Obama insisted on $400 billion in new taxes to pay for more government spending. Imagine if he didn’t have to spend those $400 billion over the next decade.

Is it possible that there is $400 billion of waste in the budget somewhere? Where might that be? How about amongst the impoverished?

What do most Americans think of when they think of the word poverty? Homeless is likely at the top of the list. Lack of adequate or any food is probably not far behind. Not enough money to have heat in the winter might be another. Lack of medical care. There are no doubt others, but those likely the things most Americans think of when they think of the poor. And that’s not by accident.

According to the U.S. Census Bureau, 30 million Americans are living in poverty. That number has remained largely stable for decades. When the nightly news reports that fact and couples it with pictures of people sleeping on grates around the National Mall or a woman and her children huddled in a homeless shelter, most people with a heart feel like there must be a problem if such poverty can exist within the borders of the richest country on the planet? Unfortunately however that is base manipulation.

The Heritage Foundation recently reviewed a variety of government data and found a picture much different than what the left would like you to believe. They reviewed data from the Census Bureau, the agency that defines how many people are living in poverty, and the Department of Energy, that produces a survey looking at what amenities people have. Looking at the poor through DOE data paints a slightly different picture than what the media paints with Census Bureau data.

According to DOE data, 99.6% of poor households have a refrigerator, 97.7% have at least one TV, 97.7% have a stove & oven, 81% have a microwave, 78% have air conditioning (vs 84% for the general population) 64% have a DVD player, 63% have cable or satellite, 54% have a cell phone (vs 76%) 29% have a video game system (such as Xxox or Wii) (vs. 31%). Forty-three percent of all poor households own their own homes and the average poor American has 16% more living space per capita than the average person living in France, Germany, the UK or Japan. While households with such amenities may be considered poor, they can hardly be considered to be living in poverty in the clearest sense of the word.

The goal here is not to diminish the notion of poverty in America. Indeed there certainly exists poverty in the true sense of the word: According to the US Department of Housing and Urban Development a person classified as living in poverty had a 1 in 25 chance of spending at least one night in a homeless shelter during 2009 vs. 1 in 195 for the average American. And there really are families that end up in homeless shelters with no other place to go. At the end of the day, statistics are statistics but life is life. If you are one of the people who are living in a homeless shelter or on the street or hasn’t had anything to eat or can’t find a safe bathroom, it doesn’t matter what the average square footage a European gets by with is. What matters to you is what is going on at that exact moment.

And that’s where the problem as defined by progressives and Democrats comes in. By defining poverty so broadly they do a disservice to the truly poor. How? By perpetuating programs that send resources to those do not need them. Every time a taxpayer stands in line at the grocery store and watches a welfare recipient talk on her cell phone and pay cash for cigarettes and lottery tickets while using food stamps to pay for food it diminishes support for all government programs. It also keeps dollars from those programs which target the truly needy.

Rather than having programs that could help those with significant problems, we have welfare programs that simply perpetuate more welfare. Between 1965 & 2008 the United States spent $15.9 Trillion in its War on Poverty (vs $6.4 on all real wars) yet 10% of the population is considered to be living in poverty today.

Despite the War on Poverty’s abject failure, it goes on. And here’s where it hurts. Even now amidst the toughest economic environment in half a century, with urban unemployment in the double digits, when the government has to borrow a trillion dollars to pay its bills President Obama and the Democrats continue to play politics. When the GOP seeks to reduce government by cutting wasteful programs, the left accuses them of wanting to cut the safety net out from under America’s most vulnerable. That’s John Edwards lie of Two America’s all over again, and it’s still a lie.

The DOE’s numbers clearly demonstrate that there is a distinct difference between those considered poor and those in need of real help. While the most effective strategy would most certainly be to eliminate all government welfare programs and allow private charities to take over, that is unlikely to get by a donkey led Senate or the progressive in the White House. More realistically, by painting an accurate picture of poverty in the country, Uncle Sam could more precisely tailor programs to help the truly needy. Doing so would help those in need by being more effective, it might help restore the American taxpayer’s opinion of government in general and would save hundreds of billions of dollars just at the time when America finds itself broke.

The Spiteful President Obama

2011-07-18T05:09:00.000-07:00

Say what you will about Barack Obama, but the man is quite exceptional. Coming from a broken home, he grew up and graduated from Columbia University and went on to earn a law degree at Harvard. Both schools are amongst the most challenging to get into in the country. Not only that, he was an editor of the Harvard Law Review and taught at the University of Chicago law school.

Looking at his life one has to marvel at the various points where he might have run into trouble that could have derailed his career but didn’t. The most obvious was his extensive experience with illegal drugs. One cannot hold a grudge against the man simply because he was lucky enough to have not gotten caught and thrown in jail. Most of us have made a mistake or two that could have changed the course of our lives had things played themselves out a little differently.

Barack Obama has had something of a charmed life. While a child of a broken home, his formative years were spend in Hawaii where he was raised by his maternal grandparents. Today he’s President of the most powerful country in the world, he has a family who loves him and he has millions of people across the country who adore him.

One has to wonder then why a man with such a charmed life is so spiteful. Typically people are spiteful when they have been grievously injured or harmed. What does Barack Obama have to be spiteful about? Who does he have to get even with? Maybe his father for abandoning his family, but other than that what else does he have to be so angry about?

We first saw this side of President Obama during the first month of his presidency when he told GOP Senator John Kyl of Arizona “I won” during the debate over the makeup of the President’s stimulus plan. The President was simply stating a fact, but the message behind the words was crystal clear, I’m the victor, you’re the losers, now we do things my way. Of course once the GOP won by a landslide in 2010 the President changed his tune, telling the GOP earlier this year that despite their having won, “Getting your way is not how it works.”

A recent and more troubling episode of this petulance was on full display just last week when the President invoked the name of Ronald Reagan during his fight with the GOP over negotiations on raising the debt limit. Frustrated at GOP insistence that equivalent spending cuts offset any debt ceiling increase the following transpired:

Cantor explained, the president became “very agitated” and said he “had sat here long enough,” that “Ronald Reagan wouldn’t sit here like this” and “something’s got to give.” He then told Republicans they either needed to compromise on their insistence on a dollar for dollar ratio of spending cuts to debt increase or agree to a “grand bargain” including massive tax increases. Before walking out of the room, House Majority leader Cantor said, the president told him: “Eric, don’t call my bluff. I’m going to the American people with this.” He then “shoved back” and said “I’ll see you tomorrow.”

The problem is not simply that the President wants to get his own way, most politicians and people want things their own way. The problem is that the President seems largely unable to work with his opponents when the chips are down. It would be one thing if he were indeed Ronald Reagan, who was able to work with opponents like Tip O'Neill to get things done in a atmosphere or respectful opposition. But he’s not.

President Obama does not seem to have that capability, and what’s worse, his petulance seems to make progress even less likely. Waiting until the last moment to become personally involved with the negotiations, the President finds himself annoyed that Eric Cantor and the GOP’s position is exactly what they have been saying it was for months: Spending cuts for any ceiling increase and no new taxes. Rep Cantor even hinted that he was open to a short term solution to provide a segue to a long term deal, but the President was having none of it.

There is an old saying that goes: “Be gracious in defeat and humble in victory.” After the Democrat victory in 2008 Barack Obama did not demonstrate the latter and since the GOP victory in 2010 he has not demonstrated the former. Petulance and spitefulness are unsavory when exhibited by a sovereign ruler, which Barack Obama was pretty close to being during his first two years. Today however President Obama must now share power with his opponents and what were previously just annoying personality traits have become roadblocks to progress.

Now might be a good time for President Obama to go back and look at the video of candidate Obama, particularly when he was talking with Joe the Plumber. The two disagreed with one another but their exchange was cordial and one got the feeling that they could have worked together if they had had to. With the debt limit quickly approaching and the future direction of the country at stake, at least 2008 campaign mode Obama would have put his best foot forward to try and make finding a solution a bit easier. One wonders if President Obama or 2012 campaign mode Obama can learn that lesson.

New York probably gets DOMA on the Supreme Court docket

2011-06-28T03:12:00.000-07:00

The Constitution is singularly the greatest document that has ever been written and has resulted in more good for more people around the world than any other single document of man in history. It’s not however perfect. It has an amendment process that allows citizens to make bad choices – see the 16th and 17th Amendments, both enacted in the midst of a progressive frenzy in 1913 – but such changes require the active participation of a large segment of the population.

There is however a move afoot to change the Constitution in a different way. Article Four of the Constitution says: Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof. This is the part of the Constitution that says if you’re born in one state you can take your birth certificate to another and get a driver’s license, or that you can drive in one state with a driver’s license from a different state. It also of course is what allows persons married in one state to be recognized as married in another.

It has not been much of an issue in modern times until states started allowing same sex marriages. Sometimes done via legislation, more often than not the change has occurred as the result of judicial action. In no case where states have given voters a choice has a majority voted for same sex marriage. This includes California, where Proposition 8 banning same sex marriage passed but was then ruled unconstitutional by a federal judge.

The Constitutional question comes into play with 1996’s Defense of Marriage Act, or DOMA, which explicitly states that no state shall be forced to recognize a same sex marriage contract from another state. It also prohibits the federal government from recognizing such compacts. This is where changing the Constitution comes into play. DOMA opponents read the first sentence of the Full Faith and Credit clause and suggest DOMA is unconstitutional. The problem however is that they simply choose to pretend the second part of the clause does not exist… but it does, in black and white: “And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.”

The whole of the Full Faith and Credit Clause was not some afterthought. The Founding Fathers included in the body of the original Constitution, a place where you will not even find the various elements of the Bill of Rights such as freedom of speech or religion. This should demonstrate exactly how important contracts were to the Founders in that they wanted citizens of the United States to feel confident those contracts would be valid throughout the country. The states however remained sovereign, and could not be forced to accept contracts that violated their own laws under Full Faith and Credit. When laws were written banning interracial marriage, it was the Equal Protection clause that provided relief, not Full Faith.

The Full Faith and Credit clause of the Constitution was not crafted as a fulcrum to allow activists to foist on the nation policies that could never be implemented on their own. The federal system gives states the right to define marriage virtually any way they want. It does not however give those states the right to force other states to agree with them. If the definition of marriage can be changed from one man to one woman to two men or two women, why stop there? Utah could resurrect polygamy and the other 49 states would have to recognize it. California might allow for the members of a commune to marry one another simultaneously. Now that you have California and New York lined up against the almost 80% of the states who explicitly ban same sex marriage, DOMA is likely an issue the Supreme Court will have to take up.

If 21st century activists want to change the way America deals with marriage they can do so, but they can’t just wish away half of the Full Faith clause. They might want to go back and read the playbook of their progressive brethren from the last century. The Amendment process is tough to get through, but that’s by design. Big changes require big buy in, and changing marriage is definitely a pretty big change.

What does it say about the United States when a Russian president sounds more like a capitalist than the American president?

2011-06-20T02:53:00.000-07:00

In preparing for the 2012 election campaign the President said the following: "The proposition that the government is always right is manifested either in corruption or benefits to 'preferred' companies." He went on: The “economy ought to be dominated by private businesses and private investors. The government must protect the choice and property of those who willingly risk their money and reputation." Also: "Corruption, hostility to investment, excessive government role in the economy and the excessive centralization of power are the taxes on the future that we must and will scrap."

Hallelujah! After three years of statist rhetoric a President who understands that it is free markets that create economic prosperity.

Unfortunately however the president speaking was not President Obama, but rather Russia’s President Medvedev. What has become of the world when a Russian president is making a stronger case for free markets than a sitting American President? Is the world standing on its head? Should we now expect the Chinese to declare Falun Gong as the national religion and announce free and fair elections?

As depressing as having a President who’s less of a free market fan than his Russian counterpart is, he’s only the tip of the iceberg. President Obama has plenty of progressive company across the country who fail to understand that freedom and economic prosperity go hand in hand.

And freedom is beginning to exit stage left… Not sure about that? The National Labor Relations Board went to court this week seeking to give unions the power to decide where private companies can invest their money; San Francisco is trying to ban circumcision, and some Chicago schools actually ban students from bringing their own lunches from home.

In a less anecdotal appraisal of our freedoms, the Mercatus Center at George Mason University just released the 2011 edition of its Freedom in the 50 States - An Index of Personal and Economic Freedom. The rankings take into account 150 different measures of freedom compiled into four main measures: Fiscal Policy, Regulatory Policy, Economic Freedom and Personal Freedom. Together they give an overall picture of a citizen’s level of freedom on things like the ease of starting a business, overall tax burden, gun laws and a wide variety of other measures.

The rankings pretty much play out the way you would expect. At the top of the list – most free – are # 1 New Hampshire; # 2. South Dakota; # 3. Indiana; # 4. Idaho; # 5. Missouri. At the other end of the freedom spectrum are # 46. Massachusetts; # 47. Hawaii; # 48. California; # 49. New Jersey; # 50. New York.

I would venture to say that most people are not surprised by these rankings. The notion of freedom to do just about anything you want in places like New Hampshire and Idaho are about as strong as the recognition that California and New York are busybody states that seem to want to regulate everything.

I thought it would be interesting to look at the correlation between freedom in general and economic prosperity in particular. My hypothesis was that the states high in freedom would be significantly more robust economically. I was surprised to discover that on my first datapoint – income level growth – that was not the case. From 2005 – 2009 household income for the five least free states grew faster than income growth by the most free in 3 of the 5 years. And their incomes were higher.

That was the last of the surprises however. On every other measure the most free states came out clearly ahead. Unemployment: Every year from 2005 right up to today the average unemployment rate amongst the five most free states was lower than the least free. Indeed, as the economy worsened the disparity grew: In May 2005 the most free states had an average unemployment rate of 4.36% while the least free states had 4.44% - a difference of .02%. Jump ahead to today and the most free states have an average unemployment rate of 7.22% while the least free states have an average rate of 8.52%, a difference of 1.3%.

On taxes the story is pretty much the same. Every single year from 2005-2009 the average tax rate was lower in the most free states than in the least free states, with an overall average of 8.6% vs. 10.8%.

What about cost of living? In ranking the states from 1-50 with one being the least expensive state to live in and 50 being the most expensive, there are no big surprises. The most free states averaged a score of 15 while the least free states hovered near the bottom with an average of 45.

So there you have it… citizens of the most free states have lower unemployment, lower taxes and a lower cost of living than their counterparts in the least free states. Residents of the least free states however come out slightly ahead based upon income and income growth.

It almost seems like it might be a wash with a slight tilt towards the free states… until you look a bit deeper. Why did income grow more in the least free states? Well, it turns out that that difference in growth is not that hard to find… it’s from their state governments’ deficit spending. During 2009 the five least free states ran an average deficit of $11 billion each while the five most free states averaged $494 million each. During 2010 the numbers were even greater, $17 billion vs. $828 million. In both cases the billions of dollars in deficit spending of the least free states was more than responsible for the disparity in income growth rates. So, not only do the citizens of the least free states pay higher taxes, suffer greater unemployment, experience a higher cost of living, it turns out the one measure where they were ahead of the game is a mirage created by a government shell game that leaves them with tens of billions of debt on their backs.

Dmitry Medvedev seems to have come to the realization that freedom and economic prosperity go hand in hand. If he ends up losing the 2012 presidential race to Vladimir Putin (who's not known for his capitalist or freedom sentiments) perhaps he can start a second career here in the United States teaching President Obama and the rest of the progressives how to bring an economy back to life…

$62 Trillion and counting... Uncle Sam's fantasyland

2011-06-13T03:21:00.000-07:00

Dreams vs. fantasies. Dreams are a good thing to have. They inspire us. They generally have some connection with reality and are usually the kinds of things one can work at attaining or accomplishing. Fantasies on the other hand usually have very little connection with reality and even less likelihood of coming true. One might dream of making a million dollars or growing up to play for the Yankees, but one fantasizes about being Superman or achieving world peace.

With age, most of us begin to recognize that there is a difference between the two… So too is it with countries… or at least it does theoretically. Unfortunately, in America in 2011 the citizenry and their agents in Washington are still living in a fantasy world. The fantasy I’m talking about is government spending. And I’m not even talking about current spending… I’m talking about future spending, in the form of unfunded liabilities: Those promises the United States has made for which it has no money to pay, no ability to pay and no plan (realistic or otherwise) for how it will pay them.

At what point does a nation grow up? At what point does a citizenry demand that its representatives speak honestly and act rationally? How big does the stack of promises have to be? Is there some dollar threshold? If so, what is it? The late Senator Sen. Everett Dirksen is said to have uttered the following: “A billion here, a billion there, and pretty soon you're talking real money.” I wonder what the late Senator would say if he had knew how large Uncle Sam’s unfunded liabilities had become. In a universe where the GOP is talking about going to the mattresses over raising the debt ceiling by a couple trillion dollars, Senator Dirkson’s “real money” has become $62 Trillion of promises Uncle Sam has no way keeping!

That $62 Trillion overhang is more than twenty times the federal government’s $2.5 Trillion 2011 revenue – and four times our $14 Trillion GDP. To put this in some perspective, let’s imagine you earn $50,000 a year in salary but your annual expenses are $65,000. To make up the shortfall you borrow $15,000 a year from a distant uncle. Given that you are spending 30% more money than you earn every year, how are you going to fund the $1,000,000 college education you just promised your newborn baby? At some point your once rich uncle, to whom you now owe $150,000, is going to cut you off. Then what does junior do for college? Imagine how upset he will get when he turns 18 and finds out you broke the promise you reiterated to him every day of his life for two decades. Unable to pay, you go out and adopt a bunch of foster children and put them to work to pay for Junior’s education. Soon enough you’ve got a house full of angry young adults each wanting their educations. At some point the reality of their bleak situation sinks in and the kids organize themselves and throw you out of the house, take whatever money you had stored in the floorboards and maybe even find out if there is a place where they can sell you into slavery.

At the end of the day, this is exactly the situation that America finds itself in. Uncle Sam – AKA the American taxpayer - owes private citizens and foreign countries $9 Trillion; owes himself another $5 Trillion (due to using the money paid into the Social Security trust fund to pay for current operations); and owes citizens themselves a whopping $62 Trillion… And that’s using the optimistic assumptions of the CBO – others peg it at $100 Trillion or more - bottom row... brace yourself!

This fantasizing simply cannot continue forever. The question is, when are the American people going to decide to force their employees in Washington to begin to take real steps to address this problem? Democrats suggest it can be solved by simply growing the economy and raising taxes on corporations and the rich. Unfortunately however, as Bill Whittle demonstrates very clearly, taking every single penny from the rich still wouldn’t even be enough to cover the costs of current operations, never mind future spending.

One doesn’t even need to raise the specter of Greece to make the point about what happens when government makes promises it can’t keep, although that is certainly an apt comparison. (Don't believe me... read what Bill Gross has to say about it.) No, you just have to look to California. Two weeks ago the US Supreme Court told the state they must release 40,000 prisoners. Why? Because they were all innocent? No. Because they had all apologized? No. Because the Court decided that the conditions in which the state was keeping them were “cruel and unusual” and therefore unconstitutional. The reason America is now going to be welcoming 40,000 criminals back into its arms is because California was not spending enough on prisons. With so many contracted promises to unionized employees there was simply not enough money left to pay for more prison cells. Sacramento, like Washington, lives in a fantasyland from which it refuses to emerge.

Forty thousand prisoners is just the beginning for California and for America. The New Jersey Supreme Court just last week demanded the state (broke or not) spend an additional $500 million for education, period, end of discussion – and just so the point wouldn’t be missed, one justice suggested raising taxes.

As shrinking credit availability and a government controlled economy that produces moribund tax revenues begins to intersect with trillion dollar deficits and exponentially larger promises of future spending, things will only begin to steamroll, and not in a good way. It will start with arbitrary budget cuts to things like national defense and homeland security and will eventually squeeze out everything other than wealth transfer payments. If Americans think they have little control over how Washington spends its money today, wait until the federal courts (filled with lifetime tenured judges) start telling Congress and the Executive Branch what they have to spend, where they have to spend it and how high they must set taxes.

The only way out of this black hole is to address the problem of unfunded liabilities and current account deficits today. If we don’t, we shouldn't be surprised when the Supreme Court demands tax rates be doubled and the pentagon slashed down to a triangle in order to pay for welfare, Medicaid and Social Security. Unfortunately however, even the entire federal budget isn’t a fraction of what it would take to pay for all of the promises Washington has made. Most of us survived learning there was no Santa Claus. The question is, how bad do things have to get before we summon up the courage to break the news to Uncle Sam?

Government programs have accomplished what slavery and Jim Crow could not... they've destroyed the black family.

2011-06-05T16:51:00.000-07:00

For those of you who have never looked at my picture, I’m a white guy. Given the subject of today's piece I might as well get it out of the way. In addition, other than participating in ROTC at Florida A&M University (an historically black institution), spending a semester in Florida State’s Degraff Hall dormitory (at that time the dorm established primarily for “African American students”) and minoring in Black Studies while at FSU, I don’t have any particular experience in what one might call black culture. (I use the word culture in the general sense, recognizing that not every member of a particular group shares all aspects of that culture.)

I do have eyes however, and much of what I see of black America is not good. I say that not as an indictment of black people. On the contrary. I don’t think blacks are any better or worse than anyone else on the planet or in the country.

That being said, I put pen to paper on this topic because of a series of disturbing headlines I’ve seen over the last month combined with something Walter Williams recently said on John Stossel’s show. Over the Memorial Day weekend Drudge ran a series of headlines about chaos breaking out across the country: Chicago, Charlotte, Boston, Miami, Nashville… The common factor across each of these melees was that the problems involved large groups of black teens and young adults. These stories dovetailed with numerous recent accounts of “Flash Mobs” across the country (Washington, Las Vegas, St. Paul) where similar groups of black youths descended on a store of one sort or another and brazenly walked off with hundreds or thousands of dollars of merchandise.

Something struck me about the people whom I was reading about or watching on video… they seemed to have no appreciation for personal property. It seemed to me that the violence and mayhem being displayed was the result of people who had an entitlement mentality where they felt they could do whatever they wanted, could take whatever they wanted, regardless of the consequences on anyone else, simply because they could. One asks how do people end up with this type of mentality. The answer was obvious: the government’s nanny state.

Then Walter Williams crystallized my thinking when he made the observation that government programs had accomplished what slavery could not do and what Jim Crow laws could not do… they destroyed the black family. The numbers are stark. Williams points out that up until the 1940’s between 75 & 90 percent of all black children were being raised in two parent homes while today the number is less than 1/3. He continued, pointing out that the illegitimacy rate amongst blacks was 18% in 1940 but ballooned to 72.5% in 2008. In a 1985 documentary he suggested that government programs, with their “good intentions” had led America’s black families into Hell.

The recent news stories about riots and gangs and flash mobs are simply the symptom of the Hell Williams discussed. There are now millions of government supported and government non-educated black youth (and in many cases their parents before them) who simply have no understanding of the concept of individual responsibility, private property or work. The result is exactly as one would expect. As Williams points out, “If you subsidize something you get more of it” i.e. dependency, illegitimacy, poverty… and most brutally, if you tax (or regulate) something you’ll get less of it… i.e. jobs.

Culture of course is different than people and there are many black people and families who do not fit into this culture. Regardless of whether or not one agrees with the notion of a black culture in the first place, one must agree that the state of black America is difficult. Bill Jones, the Chairman of the Black Studies program at FSU back in the 1980’s once said that he could make a very strong argument that blacks in America were better off before the civil rights movement. His primary argument was built on the loss of role models in the black neighborhoods as most of the successful people moved out to the suburbs as soon as they could. Without those positive role models to show them how to act, who could the young people in those neighborhoods look to for guidance?

While that was not his position, he suggested a good argument could be made for it. He makes a valid point. Role models are always important for young people, but particularly for those growing up in difficult circumstances. Despite what Hollywood might want to suggest, data clearly demonstrate that growing up in a two parent home is one of the most powerful indicators of a child’s success in life. By ameliorating the financial burden of having children, by removing any correlation between individual responsibility and income, and most devastatingly of all, by making fathers superfluous, the liberal policies of the last five decades have destroyed the lives of millions of black Americans who make up what one may or may not want to characterize as black culture.

America is too great of a nation and the challenges of the 21st century are too many to leave any group behind. If America is going to survive and thrive well into the 21st century, it will require the entrepreneurial, creative and productive efforts of everyone, including her 40 million black citizens. Let's face it, we're in this together. Five decades of government policies have handicapped millions of black families and we’re seeing the consequences of those policies in headlines across the country. Perhaps the recent demonstration of that destruction playing itself out in front of news cameras and security cameras will be a catalyst to make black Americans reconsider their fealty to the Democratic Party and the big government programs that have wrought so much damage to their communities… One can only hope.

How Paul Ryan is like the slavery loving Founding Fathers…

2011-05-30T17:39:00.000-07:00

It’s not uncommon to hear liberals ridicule conservatives for wanting a Constitutional government by suggesting that they are seeking to return to a time when blacks were considered 3/5 of a person and that the Constitution is somehow permanently damaged because it did not outlaw slavery. (At the time of the Constitution’s ratification in 1789 slavery was still legal in the British and French Empires – although not in England and France themselves – Spain, Denmark & Norway as well as most of the Middle East, Africa and Asia.)

This liberal narrative suggests that the Founding Fathers had the opportunity to outlaw slavery and simply chose not to do so because they didn’t see blacks as fully human. Nothing could have been farther from the truth. While a majority may have been skeptical of suggestions of equality between races, there were a number of eloquent anti-slavery members of the Constitutional Convention, including one of the most influential, Gouverneur Morris of Pennsylvania who called slavery: A “nefarious institution, the curse of heaven on the states where it prevailed” as well as Virginian George Mason who said: “Every master of slaves is born a petty tyrant.... I hold it essential ... that the general government should have the power to prevent the increase of slavery.”

At the end of the day, the liberal notion that the 3/5 Compromise was a mistake is simply wrong. Outlawing slavery or counting slaves as whole persons was never an option.

The 3/5 Compromise was itself the result of another compromise, the Connecticut Compromise, which gave us a Senate with equal representation and a House with proportionate representation. This arrangement provided smaller states like Rhode Island and Delaware with the confidence that they were not going to be steamrolled by the bigger and more populous states like Virginia and Pennsylvania.

It is that proportional representation that begat the 3/5 Compromise. The Constitution apportions taxes and representation by population. As such, there was a dichotomy of opinion on slaves. Northerners wanted slaves counted whole for taxes and not at all for representation. Southerners wanted slaves counted whole for representation purposes, but not for taxes. (Note: Race was not the issue: Free blacks were counted as whole persons…)

The result was the 3/5 Compromise: Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three fifths of all other Persons.

The 3/5 Compromise resulted in southern states having a disproportionate representation in the House for the next 70 years. Had slaves been counted as whole persons that imbalance and the Southern power would have been even greater than it was, a situation the North would never have accepted. As difficult as it might be for 21st century liberals to understand, the choice was never between a Constitution that outlawed slavery and one that counted slaves as 3/5 of a free man for representation and taxation purposes, but rather the choice was between a Constitution with a 3/5 Compromise and one that could not gain ratification.

The demonstration of this comes from the words of none other than Gouverneur Morris himself. In noting that the Constitution was to be willingly entered into he said: “But as the Compact was to be voluntary, it is in vain for the Eastern States to insist on what the Southern States will never agree to.” And to see exactly where the Southern states stood on the issue there is North Carolina’s William Davie who said of the representation of slaves: “(He) Was sure North Carolina would never confederate on any terms that did not rate them at least as 3/5. If the Eastern States meant therefore to exclude them altogether the business (Writing of the Constitution) was at an end.

Therefore the question today might be, were slaves and their progeny better off as part of a union that included abolitionists as part of the government and polity who were actively seeking to abolish the practice or would they have been better off as part of a country or countries where slavery was an accepted basic element of the culture and where there was no significant dissent? In addition one might ask the question of whether anyone on the continent would have been better off had the 13 colonies not ratified the Constitution and the continent split into a mosaic of nations resembling Europe and it’s perpetual wars?

To bring this full circle, whether looking back at history or ahead into the future, liberals rarely let the reality of life get in the way of their theories on how the world works. Once again they are proffering a false narrative, only this time they are discussing the future of the country. Paul Ryan has taken the first step in recognizing the unsustainability of America’s entitlement programs as they are currently configured and has laid out a viable solution for addressing the problem. Democrats on the other hand believe that the programs are just fine and the problem is simply that the rich are not paying their fair share in taxes.

Like their take on the 3/5 Compromise, liberals once again have the wrong narrative. The choice facing America’s mushrooming entitlement costs is not between increasing taxes on the rich and throwing grandma off a cliff, but rather it’s between fixing the programs and not fixing them, in which case the federal government would finally implode under the weight of its unsustainable promises.

The difference of course is that while we can’t impact history, the actions taken today can impact what happens tomorrow. Liberals could learn much from the Founding Fathers in terms of examining the real choices at hand when it comes to choosing which path to follow. It may not be as much fun as peddling simple minded populist solutions, but it sets a foundation for real progress.

$50 light bulbs! Unfortunately for you, the green in Green Energy is your dollars…

2011-05-23T03:24:00.000-07:00

One has to ask the question about Greens, do they even live on this planet they are trying to save? They often seem to be living in a completely different universe if not just a different planet.

The most recent example of this is the LED light bulb, the latest answer to Congress’s 2007 energy efficiency mandate – which was regrettably signed by George Bush. Last week a story emerged that the 100 watt LED light bulbs slated to replace 100 year old inefficient incandescent bulbs will cost upwards of $50 apiece! That’s right, $50 for a light bulb…

Fifty dollars vs. the one dollar it costs for a typical incandescent bulb. It’s a bit hefty, but then they are more efficient. The question is however, are they 50 times much more efficient? Ah, no. Two years ago Carnegie Mellon compared the energy lifecycle of LED lights vs. those of compact fluorescents as well as incandescent bulbs. (The energy lifecycle includes not only the energy a bulb will burn over the course of its life, but the energy and materials used to manufacture it in the first place.)

The numbers were unambiguous… LED lights were far more efficient. If the energy lifecycle cost of an LED is $1, the cost of producing the same amount of light from a compact fluorescent bulb would be $1.14 and a whopping $5.36 from a traditional incandescent. (Compact fluorescents are those curly bulbs that have their own significant problems.)

So it’s true that green LED light bulbs are more efficient than traditional bulbs. Five times more efficient, which makes your soul feel warm and fuzzy. Unfortunately, your wallet, not so much. That warm and fuzzy feeling of a five times more efficient bulb will cost you fifty times more money to experience.

Of course that is just the latest in a long string of Green initiatives where your wallet plays no role in the choices you are forced to make. Ethanol is perhaps the most blatant example. Not only does it make gasoline more expensive, make your car less efficient, but it turns out that it’s also damaging your engine. As a bonus, it also has the effect of increasing food prices while doing nothing for the environment. Then there’s wind and solar energy, neither of which is even remotely close to being competitive with fossil fuels. Not only are they not competitive with traditional fuels, but at the same time they are unreliable and are not exactly inconspicuous in their footprints. How about those clean energy electric cars that cost twice as much as a similar gas fueled model and go a quarter the distance without needing a recharge? Greenies are so busy basking in the adulation received for not emitting any earth destroying gases that they forget that the electricity fueling their cars comes from coal plants which are far dirtier than gasoline powered internal combustion engines. They also conveniently forget the environmental concerns created from the manufacture of all of those batteries.

As if all of this was not bad enough, Green Jobs are expensive, highly inefficient and kill off twice their numbers in regular jobs.

Greenies inhabit s universe where cost is never a factor. Why? Because they don’t have to. They don’t have to make a coherent argument for their position and give consumers the choice of acting on those rational arguments. No, instead of the rough and tumble world based on the competition of ideas and science, they simply propagate junk science as real and then harness the police powers of government to advance their agenda.

This would be bad enough if it were just about light bulbs, gasoline and CO2, but it’s not. It’s about your fundamental choice of how to live your life. In the most simple sense, forcing Americans to pay $50 for a LED – or even $25 for a CFL – rather than the $1 they could pay for a traditional light literally takes $49 out of their pockets that they can no longer spend on anything else, from buying Twinkies to donating to the Red Cross to buying a share of the latest Internet startup.

Life is about choices and it is through the experience of making choices and living with them that individuals and societies learn about the connection between actions and consequences and by implication the responsibilities that come from choices.

Liberals of course don’t have to learn about consequences or responsibilities because they know what’s best for everyone. Even when their policies fail, both on an objective measure as well as achieving their announced goals, it doesn’t matter because they never have to face the consequences. Unfortunately it’s the rest of the population who are trying to figure out how far they can go on vacation with $4.00 a gallon gasoline who end up paying for the good fortune of living on the planet liberals are trying to save. And that doesn’t even count the taxes paid so the federal government could spend billions of dollars subsidizing electric cars, ethanol, as well as the wind and solar industries…

Americans enjoy an orgy of fruit while the roots of Tree of Liberty are shredded...

2011-05-16T02:52:00.000-07:00

Americans are busy people. In one respect we are no different than any other people on the planet… our primary needs are food, water and shelter. Beyond that however, Americans enjoy a life of leisure that virtually no one else on the planet enjoys. Not leisure measured in hours worked as the French, Germans and workers in virtually every other developed country work fewer hours per year than Americans do. No, what’s different is that leisure time in the United States has so many ways of being spent. Motocross. Shopping. Television. Amusement parks. Golf. Swimming. Skiiing. Football. Baseball. Horseback riding. Golf. Off track betting. Gymnastics. Theater. College classes. Karate. Star Trek conventions. Habitat for Humanity. BBQ competitions. Susan G Komen Race for the Cure. This is only a tiny fraction of the myriad ways Americans have at their disposal to entertain themselves or spend their leisure time.

If one were to compare the spectrum of activities available to the average American with the equivalent spectrum for any other country on the planet it wouldn’t take long to see an enormous difference. None of this came about by accident. The reason Americans have dozens of sports and thousands of activities to participate in from grade school to the senior center is because the nation has been so prosperous for so long and the nation has exemplified creativity for things both consequential and not. The result is a nation where most people have available a level of entertainment and leisure that would put to shame anything Louis the 16th or Marie Antoinette might have ever imagined.

One consequence of a life filled with a plethora of options is that Americans get very busy. So busy in fact that they forget to pay attention to things that are far more consequential than who got kicked off the island this week, how many Facebook friends they have, or will little Timmy’s self esteem be forever damaged if he doesn’t get picked to play this weekend. Of course I’m talking about civics, or more specifically, government. In a perfect world no one would have to pay attention to the government because it would run like a well oiled machine in the background and it wouldn't get in anyone’s way. Alas, even Ben Franklin knew such a perfect world did not exist: “Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.”

Every two years the cacophony that is American life is made that much more dissonant by our elections. Most Americans, however, unfortunately, spend less time learning what’s really at stake in those elections than they do selecting teams for their March Madness brackets or deciding who they want to vote for on American Idol.

This might have been acceptable 100 years ago when the federal government was relatively small and had little discernible impact on the lives of most Americans. Today, when the octopus of the federal government controls virtually every aspect of our lives, it’s simply not. There is a tipping point in every endeavor in life, and the lifecycle of a Republic is no exception. Leaving the Constitutional Convention Benjamin Franklin was asked: “Doctor, what have we got—a Republic or a Monarchy?” He responded: “A Republic, if you can keep it.”

Two hundred and twenty years later we are on the verge of losing that Republic. The problem is simply that too many Americans have no idea what the danger is, and have little interest in finding out. They’ve spent so much of their lives enjoying the leisure and entertainment conditions our Republic has made possible that they have forgotten that the foundation of freedom and prosperity upon which those conditions are built are not ordained by God, not set in stone and are not guaranteed. Indeed, America with her freedoms and prosperity are far more fragile than most Americans recognize.

One simple example. Two weeks ago President Obama’s National Labor Relations Board sued Boeing for locating its new 787 Dreamliner plant in South Carolina, a right to work state. The NRLB is supporting the unions in Washington State where Boeing already employs tens of thousands of workers. The company made no secret of the fact that it chose South Carolina because it could not afford more of the five crippling strikes it had suffered over the last 20 years in Washington. At the most basic level, the federal government is claiming that it has the power to decide where a company can invest its own capital. If Uncle Sam can decide where and when a company can invest its money, they it can just as easily decide where a person spends his or her money, (say... unionized Kroger rather than non union Wal-Mart) where he or she can get a job, buy a house or what kind of a car they can buy. At some point doesn’t anybody begin to wonder if there are any limits on government at all?

Because there are so many instances of federal overreach, and their names sound so benign - American Recovery & Reinvestment Act - if conservatives were to point out every potential threat and the inherent dangers of a government that recognizes no limits on its power, they risk being labeled being political versions of the boy who cried wolf. Nothing could be farther from the truth. There is indeed a ravenous pack of wolves at the door of the American Republic and they are dressed in ill fitting donkey costumes. The problem is that most Americans are too illiterate in civics or too busy enjoying their lives to take the time to even look through the peephole.

The question is, can anyone shake the American people out of this political stupor long enough to recognize the danger they face? Will Americans rise to the occasion in 2012 or will they instead eat the fruit of the tree as its roots are cut.

To paraphrase Martin Niemöller:

First they raised the minimum wage and I cheered because I had a job…
Then they destroyed public education and I didn’t act because I sent my kid to private school…
Next they limited cable rates and I applauded because I saved $20 a month.
When they came for my light bulbs I didn’t react because it made me feel good to help the environment…
One day they said ethnicity was more important than ability for college acceptance but I said nothing because I’d already graduated…
They increased taxes on the rich and I didn’t care because I wasn’t rich.
Then they came for my gun, my car, my job and eventually all of my choices but there was no one left to stand with me because no one remembered what real liberty was or how it was supposed to be protected in the first place…

Despite killing Bin Laden, Obama is still anti-American

2011-05-09T00:24:00.000-07:00

The day before Bin Laden was killed I did a small presentation at an Americans for Prosperity event in Jasper, GA. The highlight of the event was the keynote speech by Dinesh D’Souza. The thrust of his argument, taken from his book “The Roots of Obama’s Rage”, is essentially that while most traditional Democrats seek to effect redistribution within America, Obama, pursuing the anti-colonialist agenda of his father, seeks to have the United States diminished among the countries of the world. Companion to that weakening of the United States internationally is the weakening of the country economically. One example D’Souza discussed was Obama cheering oil exploration internationally while simultaneously making it more difficult and more expensive for companies to explore & drill domestically.

The hypothesis D’Souza was proffering seemed particularly congruous when explaining Obama’s baffling movements (or lack thereof…) in the Middle East. Egypt was headed by arguably one of the most pro-American leaders (in a relative sense) in the Arab world, so Mubarak had to go. In Libya, Gaddafi had ostensibly stopped funding terrorists, paid compensation to the families of the Lockerbie bombing and gave evidence against AQ Khan. At a minimum he was not causing significant trouble for the United States, therefore he too had to go, and American firepower was sent to help… albeit under a Canadian commander. In Iran on the other hand, a country shepherded by a lunatic bent on getting a nuclear weapon who openly taunts the United States while funding terrorists across the region, participants in the Green Revolution barely received a nod from President Obama. Similarly, Syria, headed by a regime with a long history of supporting terrorism and massacring its own people, gets a new US Ambassador under President Obama. When Assad unleashes snipers to kill hundreds of protesters in the streets, hardly a whimper out of the Obama Administration.

I couldn’t help but recognize that D’Souza’s narrative seemed to fit perfectly with the quandary that Barack Obama presents. The quandary I’m referring to presents itself when one is asked the question: “Do you think Barack Obama is anti-American?” The facts might suggest that the answer yes, but the fundamental notion that American’s had willingly elected someone who is anti-American to lead the nation seems inconceivable. Nonetheless, despite the seeming incomprehensibility of the idea, and despite doing what was required in Abbottabad, that seems to be where we find ourselves.

How this happened is not as difficult as it might initially seem. As Bruce Bawer suggests, in reference to the Three Cups of Tea story, sometimes people want to be fooled. Sometimes in politics it’s not even necessary to fool people to get them to drive off a cliff. When 50% of the population pays no income taxes and Barack Obama talked about increasing taxes on "millionaires" to support more social programs for that same 50%... it doesn’t take much fooling. When environmentalists, for whom economics and real world failures are of no consequence, heard Obama laud “Green Jobs” and pillory oil companies and the coal industry, there was not a lot of fooling necessary. When idealistic young students, protected from the grown up world and relaxing on their bucolic college campuses heard Obama talk about getting their fair share and creating good jobs for everyone, once again fooling them was not even necessary. Add that to a black population that votes 90% Democrat, government unions that can exceed even that 90% and a pliant media that was derelict in it’s fundamental duty and there was not a great deal of fooling necessary for Barack Obama to win in 2008.

These demographics and mindsets have not shifted. Indeed, in some cases they have gotten worse as there are now more people receiving government checks than at any point in our history. For conservatives, libertarians, Republicans and anyone else who wants the United States to continue to be the beacon of freedom and the economic engine for the world, this presents a significant challenge. D’Souza is right when he states that 2012 will be all about Obama. The challenge however is twofold. On the one hand the GOP must field a credible candidate. While I like Sarah Palin, I don't know if she has a plan for winning the messaging war she will no doubt find herself in. There are of course others, from Pawlenty to Bachman to Cain. Any one would be a far superior President than Barack Obama.

Regardless of who the candidate is, the more consequential challenge rests with actually making the election about Obama. John McCain refused to address much of Obama’s background nor would he allow anyone on his staff do so. That was the fatal error for his campaign. In 2012 the GOP cannot allow that dereliction of duty to recur. In order to win against the tide that will be pushing for four more years of "Hope and Change", the GOP must recognize that it’s in a cage match to the death. It must highlight every single aspect of the Obama presidency that demonstrates his desire to destroy what has made this country great. The most difficult part of that will be the education of voters on exactly what Obama's doing, what are the consequences of those actions, and why they are bad for America. It’s easy for the President to talk about growing jobs and investing in America, but explaining how virtually everything his administration does has just the opposite effect is a more complex discussion. It’s easy for the President to talk about rebuilding alliances around the world but demonstrating the reality that his policies are in fact harming our international relationships is not exactly sound bite material. The President saying that he respects the Constitution takes no effort at all but demonstrating how his policies eviscerate it can’t be done simply or quickly.

At the end of the day D'Souza is right, 2012 is indeed all about Obama. Regardless of who the GOP nominates, the only way victory will come is if the party figures out how to reach out to voters and clearly articulate how Barack Obama is doing exactly what he told us he was going to do “Fundamentally transforming the United States of America” and how that is a very bad thing. The examples of such are legion from Green Jobs Czar Van Jones to the incoherence in the Middle East to GM to ObamaCare to the FCC, the EPA, the NLRB and many more. In this environment, if the GOP can’t figure out how to connect with enough American voters to forcefully retire Obama, then perhaps the GOP needs to be retired.

The Prosperity Ratio: Why we should encourage tax cuts for the rich

2011-04-25T02:42:00.000-07:00

One of the easiest ways to recognize a liberal is their refusal to accept that the universe is dynamic rather than static. The most obvious example of this is their perpetual inability (or unwillingness) to grasp the notion that increasing taxes and growing regulations impact taxpayer behavior. This can be seen in on a number of levels. On the state level it can be seen by companies and wage earners fleeing high tax locales for those with low taxes or no income taxes. Rush Limbaugh famously left New York two years ago for the zero income tax comfort of sunny Florida. Then Governor Paterson responded by demonstrating his state’s disdain for the people who actually fund New York’s nanny state spending: "If I knew that would be the result, I would’ve thought about (raising) the taxes earlier." And New York is not alone… New Jersey, Maryland and many others have also seen taxpayers flee their states in recent years.

California too is befuddled by the exodus of taxpayers from the progressive Nirvana Democrats have been creating there over the last 40 years. In 2010 an average of 3.9 companies a week moved their operations out of California due to high taxes and burdensome regulations. During the first four months of 2011 that number increased 25% to 4.7 companies leaving per week… and taking their jobs with them! What is the destination of choice for those companies? Not surprisingly, Texas, with its minimalist regulation mentality and no income or capital gains taxes. California officials were so flummoxed by the exodus that a delegation of (mostly Republican) legislators and Democrat Lt. Gov. Gavin Newsom went to Texas to talk with erstwhile California companies about why they had left the not so Golden State.

Again, not surprisingly, the answer was obvious… High taxes and burdensome regulation. For decades California socialists in Democrat clothing assumed Golden State economics were static and that they could simply raise taxes or increase regulation and employers would simply suck it up. Of course they were wrong, but they (and California’s voters) have yet to figure that out.

At the federal level, Barack Obama is the lead siren singing the “Tax the rich” song, ostensibly to try and shore up Uncle Sam’s finances. Last week the President said: “I believe that we can't ask everybody to sacrifice and then tell the wealthiest among us, well, you can just relax and go count your money…”

In an environment where fully 47% of the people in the country pay either zero income taxes or actually get “rebates” for taxes they didn’t pay, Obama and the Democrats want to hike taxes on the people who actually choose to put their capital at risk and produce the jobs that fuel the economy. And like all good Democrats, they feel like they can simply raise taxes and the rich will automatically fall in line and fork over more money without making any adjustments in their behavior.

Strangely enough, that’s not quite how things work as human nature on the federal level is no different than on the state level… when taxes go up, people change their behavior. While most people are not going to move to another country if their federal taxes are raised, they will do what they can to reduce their tax burden, from investing in foreign markets, to parking their money to hiring high powered accounting firms to help them shelter their income.

Nearby is a table whose data is drawn from IRS numbers showing tax rates from 1986 to 2005. The table focuses in on the top 1% of tax filers and isolates the tax rate and the share of overall taxes paid. The third column is a ratio I created that I call the Prosperity Ratio. (My apologies if someone has used the ratio earlier, I’ve just not seen it.) Essentially it is the average income tax rate paid by the top 1% divided by the percent of the overall income tax burden paid by the persons in that same 1%. I’ve dubbed it Prosperity Ratio because the higher the ratio, the more people who are prosperous and happy… When taxes on the “rich” are lower they get to keep more of their money, which of course makes them happy. Simultaneously those same taxpayers pay a larger percentage of the overall income tax burden, which means that the remaining tax payers are happier as well because they are paying a smaller portion of the overall income taxes. Everybody wins.

To demonstrate how this Prosperity Ratio works, in 1986 when the average tax rate paid by the top 1% of taxpayers was 33.13%, they paid 25.75% of all federal income taxes resulting in a Prosperity Ratio of .78. By 2005 when the average rate paid by the top 1% had dropped to 23.13%, they were paying 39.38% of all federal income taxes, generating a Prosperity Ratio of 1.70. Everyone won as the rich, able to keep more of their money were motivated to create more wealth, generating more revenue for the tax collector. The other 99% of taxpayers were happier as well as they were able to keep more of their income too. It should be the goal of the government to generate the highest Prosperity Ratio by cutting taxes as until the ratio starts declining.

Don’t hold your breath of course. Liberals live in a fantasy world where they can raise taxes or increase red tape and the world magically bends to their will and everyone lives happily ever after. Unfortunately for the rest of us we have to live with the real world consequences of their static delusions. Maybe now is a good time to have a discussion about the difference between static and dynamic, or in the lexicon of a liberal, fantasy and reality. And maybe this time we should include the people who keep voting for them...

Obama shreds the Constitution... again

2011-04-18T02:44:00.000-07:00

Last week President Obama was overheard telling a room full of Democrats that during the most recent budget negotiations the GOP had sought to defund some of his priorities. He checked them into the boards with “Do you think we’re stupid”?

While the GOP members certainly don’t think the President is stupid, he definitely thinks the voters are. (Perhaps with good reason… If you haven’t seen the video “How Obama Got Elected” now as we roll towards 2012 it might be a good time to watch it. If you have, now is a good time to revisit it. The level of ignorance of some of people who exercise their right to vote is nothing short of extraordinary. Rather than giving out voter cards at the DMV like lollypops at a pediatrician’s office we might want to require prospective voters to pass the same citizenship test wannabe citizens must pass…)

Not that it should be a surprise to anyone that the President thinks Americans are stupid. It’s one thing to hoodwink people during the campaign as everyone expects politicians to stretch the bounds of credulity. This was perfectly demonstrated when candidate Obama suggested that he sat in Jeremiah Wright’s church for 20 years yet somehow never heard a single one of his racist anti-American diatribes. It’s another thing all together to expect citizens to believe their President is openly seeking to mislead them. Such was the case early on in the Obama presidency and that arrogance was never as clear when the administration introduced what is possibly the most absurd policy gauge ever uttered by any politician, the infamous: “Jobs created or saved.” How is it even remotely possible that the president thought that anyone with a functioning brain would consider “Jobs created or saved” as a legitimate measure for any policy anywhere? No idea, but they did… and did so with a straight face.

Now we jump ahead two years and we finding the President once again demonstrating low opinion he has of average American’s intelligence. Not only does he think that Americans will somehow forget his plethora of flip-flops, (which Victor Davis Hanson lays out brilliantly here) what’s worse, he thinks that no one else in the country is bright enough to understand the Constitution.

One example - In December, despite a federal court ruling that the FCC lacked authority to regulate Internet service providers, Chairman Julius Genachowski and two fellow Democrats on the five-member decided to do just that and rammed through Net Neutrality regulations – which limit how ISPs can use and charge for their networks. Earlier this year the House passed a bill explicitly stripping the Commission of that power and the Senate is likely to kill it. This usurpation of power by Obama portends very bad things… If the default now becomes that the Executive branch gets to decide what it can and can’t regulate, with explicit exclusionary language from Congress being the only yoke on its power, the nation cannot survive as rapacious nanny state government bureaucrats seeking to feed their insatiable appetite for power will always be able to act more swiftly than a legislature of 535 representatives with tens of thousands of different priorities.

In another example, just last week, in signing the budget compromise, President Obama added a signing statement which essentially says he's going to ignore part of the legislation. The bill included Section 2262, which essentially defunds the President’s czars overseeing the auto industry, health care, climate change and urban affairs. Strangely, rather than simply abiding by the legislation’s covenants, which actually applied to positions that were already vacant, the President felt the need to explicitly say that Congress did not have the constitutional authority to limit his spending. Back in 2008, then candidate Obama said that unlike George Bush, he “would not use signing statements as a way to do an end run around Congress.” Essentially what the President is doing is practicing a line item veto; something I and many others support, but thanks to Rudy Giuliani, the Supreme Court has ruled unconstitutional. Barack Obama doesn’t care about that and thinks American voters are too stupid to notice. As if to prove the point, now he’s not even using a proxy like the FCC to shred the Constitution, he’s going out of his way to do it himself.

These are but two examples where President Obama, the self described Constitutional expert “I taught the Constitution for 10 years” is demonstrating his disdain for said Constitution. At the same time however the issues are relatively esoteric. It is up to the Tea Parties and the GOP (if the leadership can remember that the word leadership actually suggests leading) to clearly articulate to American voters that while Barack Obama may be a Constitutional scholar, he does not feel the document applies to him or his administration. If they can do so in a coherent and compelling way, even the voters in John Ziegler’s video might be bright enough to vote against another four years of “Change we can believe in”.

Wisconsin proves it's possible to save America...

2011-04-11T01:53:00.000-07:00

After spending two years touring the United States in the 1830’s Alexis de Tocqueville wrote: “The greatness of America lies not in being more enlightened than any other nation, but rather in her ability to repair her faults.” One wonders what he might have thought had he spent the last six months in Wisconsin.

The road Wisconsinites have traveled since November of last year may well indeed foretell the future of America.

Everything began in November when, fed up with fiscal irresponsibility on the part of Democrats, Wisconsin voters handed to the GOP not only the Governor’s mansion, but both the House and the Senate as well. The mandate was clear: Get government spending under control.

The state’s new Governor and legislature hit the ground running with the Senate working on the Governor’s bill that would strip government employee unions of the ability to negotiate for benefits and forced those state employees to contribute more to their health and pension funds. More consequentially it made the paying of union dues voluntary rather than mandatory.

Governor Walker was vilified and became the center of a firestorm of protest. On February 17th the 14 Democrats in the Senate decided to run away to Illinois, depriving the body the required 20 member quorum necessary to pass any fiscal bills.

Almost immediately the Capitol came under siege by a marauding horde of leftists bent supporting the Democrats and stifling the will of the people.

By March 9th, having had enough of the obfuscation by the Democrats, the GOP senators stripped the bill of all fiscal elements and proceeded to pass the bill after providing two hours notice online. (Only fiscal legislation requires a quorum.) The Assembly passed the bill the next day and Governor Walker immediately signed it into law…

Democrats immediately claimed the law was invalid and quickly found a state judge who would support their claim despite the fact that the Senate clearly did not violate the state’s Open Meeting’s law nor internal Senate rules. Dane County Judge Maryann Sumi at first attempted to stop the law from being published and then issued an order stopping any further implementation of the law.

The real question with Judge Sumi’s ruling is: Are there any limits on the power of the courts? Apparently the judiciary has the right to insert itself in the inner workings of a co-equal branch of government, in this case the legislature. If the Judge’s order is allowed to stand, if it is above even its co-equal branches of government then there is truly no place a judge's gavel cannot reach, not within the legislature, the executive branch nor one would expect, into absolutely every aspect of the lives of citizens. Who could stop them?

At this point democracy in Wisconsin had become a farce. The people vote; the elected officials attempt to do what they were elected to do, all the while being pilloried and attacked by opponents. They succeed in passing the law according to the constitution and suddenly a member of the judiciary rips the reins of power from the people. Soon the case finds its way in front of the state Supreme Court.

The witching hour came last Tuesday when Justice David Prosser was up for reelection to the Supreme Court, which is currently composed of four generally conservative justices and three progressives. Union and other leftist organizations from around the country poured tens of millions of dollars into Wisconsin to support Assistant Attorney General JoAnne Kloppenburg, a progressive who could be considered a sure fire vote to sustain Judge Sumi’s ill advised ruling.

The question on everyone’s mind leading up to the election was, would the citizens of Wisconsin vote to support their elected officials or would they cave into the intimidation and lies of the unions? While a recount seems likely, in what was by far the most highly participated in judicial election in Wisconsin history, it appears that the citizens of Wisconsin have decided that they have had enough of the thuggish behavior of its public employee unions and Justice Prosser will be retuning to the Supreme Court.

If this resurgence of fiscal responsibility and internal fortitude was not enough to solidify Wisconsin’s position as the leading light in the very winnable battle to save the Republic, there are a few more things that should make the state’s position crystal clear:

1. Wisconsin voters gave 3 term incumbent Russ Feingold the boot in November.
2. Paul Ryan’s district is in Wisconsin, and Ryan is the leading voice in the GOP on fiscal responsibility.
And perhaps most tellingly:
3. Wisconsin citizens are not only withstanding the union thug tactics, they are actually pushing back…

Many of us feel like America is approaching a precipice on the edge of an abyss from which there would be no return. We could do much worse than look to the example set by Wisconsin’s citizens and politicians (or at least some of them…) to remind us that it is possible to pull back from the edge regardless of the foes lined up against you. I think Tocqueville would not have been surprised.

Arrogance Incarnate - Obama and his union friends...

2011-04-04T04:48:00.000-07:00

Life not fair. Nor for that matter is it unfair. It simply is. It’s not fair or unfair that the lion feasts on the slowest zebra or that the penguin who leaps into the ocean at just the wrong moment becomes dinner for an Orca. Life is life… fair doesn’t come into play.

Fair is a fundamentally human concept that is defined by a lack of preference or favoritism and or injustice.

Despite its subjective nature, fairness is a word that the left loves to bring to what should be an objective realm, politics. It’s not fair that CEOs earn millions of dollars when their employees are earning minimum wage. It’s not fair that the acceptance rates into Stanford or Ivy League universities differ between blacks, whites and Asians. It’s not fair that the United States has less than 5% of the world’s population yet uses almost a quarter of the world’s energy. It’s not fair that someone was born on the wrong side of the Rio and someone is trying to send them back home.

Unfortunately, life is not fair and neither wishing nor government can make it so. That of course does not mean that liberals do not try to use the government for exactly that purpose. From affirmative action to welfare to social security to government set-asides to progressive tax rates to suits against voter ID laws, liberals seek to use the coercive nature of government to create a world where everyone (read every outcome) is the same.

One of the many problems with the left’s pursuit of fairness through government is the idea of who gets to decide what is fair, and on what basis. Back in the early 1990’s much was made of the fact that blacks were getting rejected for mortgages more often than whites. Not only did the story become front page news, but it led regulators to make changes in banking rules which in turn produced the economic collapse of 2007/08. Not surprisingly, not only did it turn out that the story in itself was false, but the ensuing legislation had the effect of actually harming the black homeowners it was seeking to give a “fair chance”. (Thomas Sowell does a tremendous job of rebuffing the idea that blacks were receiving unfair treatment in the first place.)

Another example of the left seeking to use government to impose fairness is welfare. In an effort to provide a basic level of income for the poor and downtrodden, the federal government has spent trillions of dollars over the last 40 years. True to form, rather than obviating poverty those fairness based programs have instead created a perpetual underclass and alienated tens of millions of Americans from the fundamental notion of working to support themselves and their families and becoming contributing members of society.

As bad as these examples are, one could argue that they are merely the wrongheaded actions of useful idiots who have no understanding of basic economics. It’s another thing all together for politicians to conspire with groups in the name of “fairness” to impose regulations on the entire country and then to turn around and exempt the groups with whom they were conspiring from the very regulations they’d just passed.

Such is the situation with the single most controversial and intrusive piece of legislation of our lifetimes: ObamaCare. In January HHS released the list of the latest 729 organizations to receive waivers from the onerous requirements of ObamaCare. Those 729 organizations represented a total of 2,189,636 employees. A quick look at the largest of those organizations exposes the hypocrisy and arrogance of the Obama administration. Of the 100 largest organizations – by covered employees – being granted a waiver, 57 of them are unions, representing 836,278 employees, or fully 40% of the total. What makes this hypocrisy so pernicious is that unions were the single biggest supporters of ObamaCare in the first place.

Citizens expect their politicians will pass laws every now and then that benefit this or that constituent or funnel funding to their home district for a bridge or a community center. While offensive, such pork barrel efforts are largely innocuous to the general public as they typically impact only a small number of people and do so in a positive light – if of course you don’t count all of the taxpayers who had to actually pay for that pork.

ObamaCare and the unions are doing something all together different. Not only is it what most people would call unfair – although few on the left are suggesting that of course – but more consequentially, it is blatant deception of the American people. Essentially what we had was an administration conspiring with some of its favored groups to vociferously advance the notion that ObamaCare was an absolute necessity for the country and that it would benefit everyone. Then, as soon as the law is passed, it begins exempting the very groups that helped force the legislation down our throats in the first place… or giving them money to defray its costs. (The administration just announced that it has spent $1.7 billion on helping 1,500 organizations deal with ObamaCare’s consequences… Once again the same story: A quick look at the top 40 organizations given money reveals that 15 of them are unions who cashed checks for $573 million, or about one third of the total.)

However one defines good government, and whatever one’s expectations as to the proper role of government, by any objective standard, this is not it. When an administration becomes sufficiently arrogant that it feels it can blatantly lie with impunity about its signature legislation knowing that its detractors are watching it like a hawk, one has to wonder what it’s doing behind the scenes with the tens of thousands of other regulations and Executive Orders that neither the citizens nor the press have the time or bandwidth to scrutinize. Now that doesn't seem fair to anyone...

Fear of a Black Planet… or at least of a minority majority country…

2011-03-28T03:34:00.000-07:00

Earlier this month a demographer in Texas cause something of a stir with a report headlined: "It's basically over for Anglos". Fundamentally what he was saying was that within a few decades Hispanics would be the majority in Texas. Two out of three children in the state are already non-Anglo, and the minority birthrate far outpaces whites.

That was followed up this week by a report in the Wall Street Journal discussing the fact that the overwhelming majority of the growth in the United States population is coming from – and will continue to come from – minorities, particularly Hispanics and blacks. At the current rate, whites will be a minority in the United States soon after 2040.

The ramifications from that change could be significant. How? Minorities have higher crime rates, higher welfare rates, higher dropout rates, higher unemployment rates, more child poverty, lower literacy rates and more unwed mothers than whites. To the degree that those elevated numbers become the norm, that is problem.

One narrative from this data might suggest that the prospect of whites being a minority has great dangers in terms of the continued economic and social well being of the United States.

That is not the narrative I would posit however. Rather, I would suggest that the color of the skin of the majority of the American population today or in 2040 is of no consequence.

While it is beyond dispute that whites have been behind the majority of the advances of the last two centuries, the truth of the matter is that it had nothing to do with their DNA and everything to do with America’s entrepreneurial spirit, something that was denied for 150 years to many minorities. From Elisha Otis to Charles Goodyear to Kemmons Wilson to Bill Gates, it was the free market that allowed these men and many others to transform the world. Importantly, free markets can only thrive within a political framework of individual liberty and private property, and those laws don’t care about race.

The problem with the future of America is not that minorities will eventually be the majority, but rather that anti-capitalist liberals may eventually be the majority. Put another way, the problem for America’s future is not that there are too many minorities, but rather too many minorities may end up as liberals.

The challenge for those who are concerned with the future of the United States, is not to fret over demographic shifts, but instead to attract the coming majority of blacks, Hispanics and Asians to the conservative position.

Today we have a country that is fundamentally falling apart. The government takes too much money from the citizens yet still spends even more. One third of all income comes from that government. Almost half of the population pays no income tax. Government employee unions have a death grip on state and city finances while teacher’s unions have destroyed the public education system. The policies that facilitated most of these problems (as well as many of the challenges listed above that so negatively affect many minority communities) found their genesis in the Democratic Party: Welfare, government employee unions, the 17th Amendment, etc.

Unfortunately for America, today a majority of minorities consider themselves Democrats, or at least vote that way. Biased media, a liberal judiciary, brainwashing schools and pandering politicians… the reasons behind why they do is unimportant. What is important however (to the future prosperity of the country) is that conservatives figure out how to reach out to minorities and persuade them that it is in their best interests, and indeed those of their families, their communities and the county, that they become conservatives and vote that way. To put that another way, the GOP must demonstrate to minority voters that the solutions to the problems detailed above are not to be found in more Democrat big government programs, but rather in traditional conservative governance based on free markets and individual liberty coupled with individual responsibility and family cohesion.

Many in the GOP say that minorities should vote for them simply because polls suggest that they share many conservative values. While that may make some sense, it has not proven to be a successful strategy in terms of attracting votes, and everyone knows what Einstein said about doing the same thing and expecting different results.

If the GOP hopes to retain a voice in American politics it will have to do more to attract minorities. (Although I’m somewhat using the GOP interchangeably here with conservatives, it is actually conservatives who need to act, either through the GOP or through the Tea Parties if the GOP doesn’t have the stomach.) That does not mean changing or compromising conservative values, but rather finding ways of communicating to minorities that conservative ideas are the recipe for success today just as they have been for the last 200 years.

Make no mistake, this is an uphill battle. As long as unions are able to coerce hundreds of millions of dollars out of employee’s paychecks every year and spend those dollars to vilify Republicans and lie about Democrat success, this will be a struggle. Add to that the left leaning mainstream media and it’s going to be a very tough road. Nonetheless the fact remains, if conservatives do not act, all hope is lost.

The reality is that the future of the country has a darker tinge to it and the $64,000 question is, is the GOP going to do what is necessary to make sure that that future majority appreciates and supports the conservative foundations that created an Exceptional America or will it simply allow the country to implode under the weight of a bloated, smothering insolvent federal government that abandoned Constitutional principals decades ago. With ramparts manned by the likes of Herman Cain, Marco Rubio, and Thomas Sowell there just might be a chance.

Why I love Sarah Palin

2011-03-20T15:31:00.000-07:00

I love Sarah Palin. There, I’ve said it. While I’ve never met her, that is beside the point.

What is right on point however is why I love her. Sarah Palin bleeds American. She is not American simply because of an accident of birth. Rather, she understands what makes America different; she believes that America is exceptional and knows what makes it so; she is passionately pro-American without being jingoistic; she is willing to fight for what she believes regardless of who’s lined up against her; she is willing to put her credibility and reputation on the line to help others who share her views. Finally, and perhaps most importantly, she is a normal, average, regular person.

Sarah Palin did not grow up rich or attend an Ivy League school. She did not spend her life in a courtroom extorting money from corporations or small businesses. She did not spend her life in an ivory tower or in an editorial room pontificating about how the world works in some fantasy universe where government regulations make everyone pure and everything perfect in every circumstance. No, she has lived a fairly normal life, one you might call working class.

I remember back in ’88 or ’92 someone asked George H.W. Bush if he knew the price of milk, and he didn’t. He was of course pilloried for being “out of touch” with the common man. (Frankly it doesn’t bother me at all that the VP or President of the United States doesn’t know the price of milk… let someone else buy the milk, I’d rather him focus on knowing how much of our money government is wasting!) Sarah Palin probably knows the price of a gallon of milk. More importantly, she understands America from where the tire hits the road. She started out her political career at the PTA because she wanted to improve the education her children were getting. From there she spent four years on the Wasilla city council and six years as mayor. Next she was appointed to chair the Alaska Oil and Gas Conservation Commission and later defeated the incumbent to become the Governor of Alaska. In every one of those endeavors Palin showed herself to be not only capable, but effective and successful as well. Indeed, the latter two positions found her fighting an Alaska version of Tammany Hall.

She has demonstrated a willingness to fight for what she believes in, even if it is within her own party. She defeated the Murkowski machine in Alaska and she stood side by side with tea party candidates across the country in 2010, often against the wishes of the entrenched GOP establishment. Christine O’Donnell may have been a flawed candidate, but at least the citizens of Delaware had a choice between two distinctly different paths rather than the choice between the liberal and more liberal paths they would have had with Chris Coons and Mike Castle. They may have chosen bigger government, but at least for a change they had a choice, and Sarah Palin helped give them one.

Sarah Palin is also average in another way. She is not polished – or at least she wasn’t when she burst upon the national stage. She is not slick. She does not have a sound bite sized answer at the ready in case she gets asked any questions. Just the opposite, actually, often you can see her crafting an answer on the spot. The interview with Katie Couric was indeed painful to watch. The truth however is that her less than stellar performance in that and other early interviews were not signs that she was a dolt as many suggested, but rather the consequence of being thrown onto the world’s biggest stage with the klieg lights on max. You might say she was… shell-shocked. Many people, including myself, wondered how she could not name a single newspaper she read regularly or give a coherent answer on the Middle East. Knowing the answers and delivering them in front of a world wide audience are two different things. (Example: say the alphabet using nouns to represent each letter: Apple, Barrel, Continent etc. Now imagine having to do it in 20 seconds in front of 1,000 people and your job rests on your success…) Her poor performance communicated more about her interview preparation than her qualification to be President. Indeed a week later she outperformed Joe Biden in their debate, and few lefties would argue he was unqualified to be President. Her early performances were those of someone whose persona was not forged in front of camera. I’ll take someone who is right on the issues but flubs an interview 10 times out of 10…

And the issues are where Sarah Palin shines. Like Ronald Reagan, she understands that government is the problem more often than the solution. She understands that low taxes and fiscal discipline are an absolute necessity as government has no money other than that which it takes from taxpayers. She understands that Barack Obama was right when he suggested the Constitution “Says what the states can’t do to you. Says what the federal government can’t do to you, but doesn’t say what the federal government or state government must do on your behalf…” The difference is that to Obama and the left, that’s the problem whereas Sarah Palin understands that that is why the Constitution exists in the first place. She understands that an unconstrained government will continue to grow and usurp powers until eventually it strangles the life out of its citizens and our republic.

In addition to the issues, Sarah Palin seems to be made of steel. She has undergone a seemingly unending barrage of mocking and criticism to a degree that perhaps no other American politician has had to endure in modern times. Through it all however she has carried herself with grace, good humor and most importantly, she has understood that the issue is not her, it’s the country. The fact that she is willing to stand up and respond to the left – particularly the media – should not be seen as a symptom of being thin-skinned or even petty, but rather a desire to keep the focus where it should be, on policy and Constitutional government.

So the reasons I love Sarah Palin are thus: She knows what it will take to put the country back on solid economic footing. She’s a rabid Constitutionalist who will rein in the federal government. She will let American interests and the interests of the American people dictate American foreign policy rather than looking to international bodies for direction. She understands the importance of free markets, free trade and energy independence. She believes in American exceptionalism, and perhaps most of all, she understands that individual responsibility is the cornerstone of upon which character, community and country are built. Without that everything else collapses.

2012 is going to be the most important election in more than a century. Our nation has been shaken to its very foundations by an onslaught of government encroachment and unprecedented fiscal irresponsibility. In times like these, when those basic fundamental things that made America great in the first place are the very things being undermined, we would be lucky to have a ticket headed by someone who truly understands what it’s like to live and thrive as an average American, someone who didn’t spend most of her adult life in the insulated and unrealistic universe of liberalism consisting of courtrooms, college classrooms and the corridors of power that make up Washington D.C.

The rich don't pay their fair share... unfortunately that's true.

2011-03-14T04:17:00.001-07:00

There’s an old saying; A picture is worth a thousand words. Pie charts will likely never be confused with great art in terms of story telling, but they have a way of making complicated issues clear. Income taxes are one of those things that are naturally difficult to grasp and the issue is made that much more opaque because liberals love to obscure the facts.

One of the shibboleths of the left is that the rich don’t pay their fair share of taxes. One of the more amusing segments of the 2008 Presidential campaign involved Neal Boortz asking then Democrat hopeful Dennis Kucinich two simple questions:

What percentage of total income is earned by the top 1% of income earners?

What percentage of total federal income taxes are paid by the top 1% of income earners.

Congressman Kucinich answered: He thought the top 1% of income earners earned 60% of the income and paid about 15% of the taxes. He was a little off. In fact, the top 1% of income earners earn approximately 17% of all the earnings in the country. That’s certainly higher than the 1% they represent of the population but a far cry from Congressman Kucinich’s 60%. More astounding however, is that they pay fully 39% of all of the federal income taxes - according to a 2009 Congressional Budget Office report. The below chart demonstrates clearly the absurdity of the notion that the rich do not pay their fair share of taxes.

The first chart shows that the rich do indeed pay far more than their oft cited “fair share” of income taxes. Not only that, it also shows that the bottom 40% of wage earners actually have a negative tax rate and get money back from the government in the form of income tax credits!

Another of the left’s arguments is that the lower income wage earners pay a disproportionate amount of the Social Security / Medicare tax. That too is false. The second chart states that the top 10% of wage earners pay 43.5% of all social insurance taxes while the bottom 40% pay just 15%.

Why does any of this matter in the first place? The third chart (taken from a 2010 report from the Tax Foundation) demonstrates why…Jobs. It compares wage & salary, capital gain, and dividend income for all income earners. As you can see, for the 80% of income earners below $200,000 per year, wages (i.e. a job) make up almost their entire incomes. Without jobs that someone else creates they would have no income... except government transfer payments.

At the $200,000 and above level, business and dividend income starts to take off and by the $1,000,000 and above level the three are almost equivalent. Those are the telltale signs of success. Those people earning those $200,000 and above incomes are the people creating the jobs that employ most of the remaining 80% of the population.

Put another way, jobs are not created by wage earners. Jobs are created by entrepreneurs risking their capital to start businesses… And those entrepreneurs are the usually found in that $200,000 and above group. The businesses they start generate 65% of all new jobs created in the United States.

While the first two charts debunk the myth that the rich do not pay their “fair share” the above chart demonstrates why it matters: The rich are the ones starting small businesses and creating jobs and prosperity.

Myths die hard, particularly when their proponents willingly ignore the facts. The myth that the rich don’t pay their fair share should soon be headed the way of the global warming hoax. Clearly it is the people at the upper end of the income spectrum that are being treated unfairly. They are not paying their fair share... They are paying more. Not only are they responsible for 2/3 of all new jobs created, but in return they are rewarded with being allowed to keep even less of their income as they become more successful. Perhaps as more Americans examine and understand what it takes to generate and sustain a dynamic and growing economy the “tax the rich” cries will begin to fall on deaf ears. That’s exactly what America could use right now, a reinvigorated entrepreneurial class striving to put more money in their pockets… and generating millions of jobs in the process.

Scott Walker has a messaging problem

2011-03-07T01:08:00.000-08:00

Wisconsin governor Scott Walker has a problem. It’s not the smelly, indian sitting - Kumbaya singing activists who are turning the statehouse into Woodstock ’11. Although they are a problem – it’s primarily to the olfactory system. Nor is it the union thugs who are harassing reporters, people who dare to voice their support of the Governor and representatives on their way to their offices.

No, the Governor’s problem is one of messaging. For much of the last two weeks the news cycle has been focusing on Madison. Much of the coverage in the mainstream media has focused on the union message of standing up for “working families”, protecting union “rights” and “fairness”. That’s a problem for the Governor. Americans generally will pull for an underdog in a fair fight and the mainstream media is making this out to be a David and Goliath competition… and he’s Goliath.

Few Americans (or Wisconsinites for that matter) are actually in Madison and able to see exactly what is going on it the Capitol. As such they are forced to rely on what is being reported, primarily on television, but also on the Internet. While Fox News dominates the cable news arena, their numbers are very small when compared to broadcast network news. The average news program on Fox News attracts approximately 2 million viewers nightly while ABC, NBC and CBS have a combined 23 million viewers between them. Online Fox News defeats the news websites of the networks, its traffic is dwarfed by CNN’s.

At the end of the day, this story, like most stories, political and otherwise, comes down to two things, facts and communication. On the facts, Scott Walker has everything on his side. The state’s finances are a mess. Unionized government workers earn more money, have better benefits and much more job security than their private sector counterparts, i.e. the taxpayers. (The average Milwaukee public-school teacher earns $56,500 a year in salary and another $43,500 in benefits for total of $100,000, and in return Milwaukee students perform far below national standards…) The state’s income tax rates are higher than 37 other states and its corporate income rate is higher than 32 others. According to Arthur Laffer, in 2010 Wisconsin came in 44 out of 50 states in economic performance. The facts are in his corner. It’s the communication that Governor Walker is missing.

Most Wisconsinites, like most Americans, when looking at this situation would understand that something needs to be done, and that raising taxes is not the solution. At the same time there seems to be some residual support for unions and collective bargaining. This in large part has to do with the sympathetic portrayal of the public sector employees by the media. What you rarely see from the mainstream media however is the thug tactics that unions across the country… including Wisconsin, use to harass, intimidate and threaten their opponents. (That last piece is from the NYT and a hat tip is due for one of the rare MSM pieces that mentions such tactics.) This is fundamentally why unions want Card Check. It’s one thing to vote against a union secure in the anonymity provided by a secret ballot, it’s a completely different thing when the union enforcers are standing at the front door of your home with a clipboard or hovering over you at the signature table.

In this current environment Walker should take a page from another darling of the GOP Chris Christie. Christie has been out in the trenches mixing it up with union members across the state. The web is chock full of videos of Christie taking questions from audience members complaining about having to pay for their own benefits or having their wage raises limited. In each case he clearly explains the situation the state is in, why the state is in that situation (usually demonstrating how union intransigence helped bring it about) and what he is trying to do to fix the situation. Invariably audiences understand his position and the state’s population largely does as well.

Although Walker has been crystal clear in his critique of Democratic lawmakers and has spoken about the challenges the state faces, he has yet to put on a full court press in bringing his message to the citizens of Wisconsin. This can be seen in the latest Rasmussen poll that shows support for his position down to 43% amongst likely state voters. While a governor should never govern by poll, this poll suggests that he is not getting his message out clearly. This is particularly true given the fact that Wisconsin voters just put him in the Governor’s mansion and gave the GOP both houses of the legislature with a mandate to fix the state’s financial mess. Given that, the public should be poised to give him benefit of the doubt. The fact that his numbers are moving in the wrong direction suggest he has a communication / messaging problem.

The support of a majority of the voters is not a requirement for implementing a policy. The foundation for this was perhaps best said by Edmund Burke: Your representative owes you, not his industry only, but his judgment; and he betrays instead of serving you if he sacrifices it to your opinion. Majority support is however critical for long term success of any policy, particularly when not all legislators live up to Burke’s ideal. As long as Walker allows the flower children, the union thugs and the mainstream media to define the discussion, his numbers will continue to decline. If he hopes to succeed in his pursuit of transforming Wisconsin from an economic laggard to a job creating dynamo, he might want to figure out how to take control of his own story and get the message across to the voters of Wisconsin that their state is a landed version of the Titanic headed towards an iceberg and he’s the only one suggesting a change of course.

Barack Obama & Chris Christie - First & Other Impressions

2011-02-28T04:31:00.000-08:00

How often have you heard someone say “I don’t see color” when they are trying to prove that they are not racists? “I only see people” usually follows. Unless that person is colorblind or actually blind, he or she is an idiot. Observing that someone is black or white or somewhere in between does not make someone a racist. It merely demonstrates that they are using one of the many tools that God gave them to help make sense the world around them. It is what they do with that information that determines if they are in fact racist or not.

Skin color is but one characteristic we see when we observe people. Whatever the physical characteristics a person has, the reality of the world is that they are going to be judged in part by those characteristics, particularly at the beginning, as in the form of first impressions. Physical characteristics are not the last word however and first impressions can be wrong, and often are. It is understanding that first impressions may be wrong that give us the capability to use some of those other senses to get a deeper picture of someone. Today we have living proof that first impressions can be wrong and recognizing that proof will be very important in the next election.

Barack Obama is from start to finish a great political package. He’s tall, good looking, confident, athletic and has a great smile. If he were not a politician he could be a cover model for GQ. Indeed, his attributes were not lost on Joe Biden during the 2008 election cycle: “I mean, you got the first mainstream African-American who is articulate and bright and clean and a nice-looking guy, I mean, that’s a storybook, man.” Biden is right, Obama had it all. Thanks to the left leaning media in the United States, this idol-like first impression of Obama is about all many Americans saw. (There were other perspectives out there however, if they had bothered to look…)

We’ve now had two full years to see if that first impression of the Solomon / Moses like leader we were shown was backed up by substance. Sadly for America, not so much. He doesn’t think very well on his feet and he has a difficult time completing a coherent thought without his teleprompter. Most importantly however, he’s proven that he’s wedded to a leftist philosophy that has failed everywhere it’s been tried. From spending trillions of dollars we don’t have to socializing 1/7th of the economy to nationalizing the US auto industry, he has demonstrated he clearly has no clue about how the United States became a successful nation.

On the other end of the first impression spectrum you have New Jersey Governor Chris Christie. He’s fat. (as John Corzine highlighted during his campaign to retain the Governor’s mansion) He’s acerbic. You probably won’t find any women fainting at his rallies and if he was a doctor no one would ever say he has a good bed side manner.

We’ve now had a full year to see if his less than striking image is backed up by anything of substance. Here, he is nothing short of breathtaking. In a little less than one year he proposed a cap on local property taxes, vetoed countless bills that sought to increase a variety of special interest programs and feckless agency budgets, and he signed a 2011 budget that closed an $11 billion deficit without raising taxes.

Despite physical characteristics that might lead someone to be less than open to Christie initially, he has quickly won over significant portions of the GOP and has many people talking about him as a 2012 presidential candidate. Hmm… To imagine what an Obama / Christie campaign might look like, compare how each performed when talking to citizens at two different events.

Obama took questions from the audience at an event in Charlotte last April. A woman in asked: “In the economy times (sic) we have now, is it a wise decision to add more taxes to us with the healthcare (bill)?” In attempting to answer Obama rambled all over the map for 17 minutes but never actually gave an answer to the question itself. He went from “We have up until last week been the only advanced country that allows 50 million of its citizens to not have health insurance, and the vast majority of those folks work...” in the first minute of the answer to “We had to spend $787 Billion on the Recovery Act to all the things like unemployment insurance, COBRA, what’s called F-Mat – which is essentially helping states keep their budgets afloat…” near the 15th minute. All together Obama spoke 2,500 words but said almost nothing of substance.

Compare that to Christie as he participated in a town hall meeting last month in Middletown, NJ. A policeman upset about Christie’s proposal that government employees be forced to pay up to 1/3 of their healthcare premiums asked the following: “With a 2% cap on a raise per year, how am I going to afford to pay $8,000 for medical benefits?” Christie’s answer: “You’re not. You’re not going to afford it.” He went on: “What’s going to happen is you’re going to have to make choices amongst medical plans, and have more choices than just three choices which you have now, and only the Cadillac plan. You’re going to have to make choices. Like everybody else is going to have to make choices in this economy. Everyone’s having to make those choices.” When the questioner asks how he’s supposed to live in the state with a paycheck that increased by $4, Christie responds “Here’s the difference… You’re getting a paycheck, and there are 9% of the people in the state of New Jersey who are not… And if their property taxes continue to go up to pay higher and higher salaries in the public sector, they will lose their homes… I have to tell you, I understand your frustration about not getting a higher raise, but you go around this room and talk to people in the private sector who haven’t gotten raises for years, if they’ve been able to keep their job at all. So this is the economic reality we live in today. I wish it were different, but it isn’t.”

Christie’s answer took less than seven minutes and when he was done every single person in that room understood what he was saying and knew that his logic was unassailable. Such clarity and substance are foreign concepts to Barack Obama.

While many conservative political junkies know and love Chris Christie, he is far from a household name to most potential voters. Given his girth and his propensity to speak his mind, the mainstream press in the United States will likely paint a less than flattering picture of him if he chooses to pursue the White House. Thankfully however, as Peggy Noonan points out in the WSJ this weekend, the Internet has freed Americans from the tyranny of the sound bite and the leftist media. As we move closer to the 2012 election cycle we can expect that there will be many more videos that highlight exactly why first impressions can be wrong. Maybe in 2012 we can get back to substance over style.

Scott Walker channels JFK... except for that 10988 deal

2011-02-21T17:53:00.000-08:00

We are at the beginning of the most consequential domestic conflict the United States has fought since the Civil War. Like the battle between the Blue and Grey, this one is for the continued existence of the country. Today’s weapon of choice might be the legislative pen and the protest sign and there may not be blood flowing in the streets, but make no mistake, the stakes are exactly the same: The survival of the nation as we know it. If that sounds like hyperbole, think about the German inflation of the 1920’s or Zimbabwe today. At some point taxpayers will have nothing left to give, the Chinese will stop buying our debt (or worse...) and our creditors will begin calling in loans that Uncle Sam is unable to pay. We might survive, but America would be a decidedly different nation.

While Lincoln’s Gettysburg Address was the speech that defined that war, another president’s words define this one. “Ask not what your country can do for you - ask what you can do for your country.” Today, one does not need to look far beyond Wisconsin to recognize that the party of JFK has long abandoned his challenge.

The fight that is going on in Wisconsin right now, the fight that took place in California six years ago, and the fights that are on the horizon in places like New Jersey, Ohio and Michigan are at the front lines in the coming war. The lines in this conflict are crystal clear: On the one side you have the Democrat Party, which is a wholly owned subsidiary of the Unionistas (a great word taken from Rush) and on the other side you have a GOP being dragged, kicking and screaming, into becoming an advocate for fiscal responsibility by the Tea Party movement.

Six years ago Arnold Schwarzenegger went through the much of what Scott Walker is experiencing today. Faced with perhaps the most left leaning legislature and population in the country, the Governator eventually took down his reform shingle and became just another GOP speed bump on California’s march to economic suicide.

To understand what is at stake in Wisconsin and the rest of the country, at both the state and federal level, one need think about one name: Bernie Madoff.

Bernie Madoff spent a quarter of a century wooing investors into his Ponzi scheme. As dupes were encouraged to “invest” and others were smiling all the way to the bank, the Keystone Kops at the SEC never recognized the problem. Everything was sugarplums and cherries until the day the fraud was exposed – by Madoff’s sons, not by the government.

Over the same quarter century the exact scenario has played itself out in statehouses across the county with governors and legislators playing the role of Bernie Madoff. In this case however the taxpayers were the dupes and the public sector unions the ones cashing the checks. Now that the schemes have been exposed for exactly what they are, the unions want to keep cashing the checks, regardless of whether or not there’s actually money available to cover them.

Where Kennedy challenged citizens to recognize that the role of government was not to be a trough from which pigs feed, today’s Democratic Party is willing to bankrupt states and the federal government for the enrichment of the public sector unions. Rather than recognizing the challenge at hand, the Democrats have instead chosen to seek to play on the public sympathies by suggesting that they are merely seeking to protect vulnerable worker rights.

In an interesting contrast to the pollyannaish voters of California who believe they can continue their spending binge even as employers flee the state, Wisconsin voters, when facing similar dire circumstances, decided instead to put a stake in the heart of the Democrat machine and handed the GOP the House, the Senate and the Governor’s mansion. Now that the elected officials are seeking to do exactly what the voters sent them to Madison to do, the Democrat / Unionista parasites have cried foul and are seeking to bring the state to its knees.

They should not be surprised when they discover that their clarion call inspires few followers beyond their own cabal, and in fact results in a strengthening of the GOP. In a state with 7.7% unemployment – up from 4.3% two years ago – a sea of red ink and an economic competiveness ranking of 40 out of the 50 states, Wisconsinites are not particularly sympathetic to state workers who earn 33% more than private sector workers, have extraordinarily generous health and retirement benefits, and all of that while enjoying almost iron clad job security.

The battle going on in Madison is nothing less than the battle for the future of America. Scott Walker is leading the charge with guys like Chris Christie and John Kasich at his side. Americans of all stripes – with the obvious exception of Democrat Unionistas & Californians – seem to finally be waking up to the fact that public sector unions are nothing but a cancer on the body politic. (JFK doesn’t escape unscathed in this disaster as he unleashed public sector unions on the federal government in 1962 with Presidential Order 10988.)

Like any cancer patient, if the country wants to survive the cancer will have to be cut out or somehow rendered benign. Ronald Reagan understood that and it seems that Scott Walker does as well. Hopefully Madison will be the first in a line of battles that culminates at the ballot box in 2012. If enough battles are won America may yet avoid a Madoff like meltdown.

Certification bonanza - Industry uses state's police powers to line their pockets...

2011-02-16T03:15:00.000-08:00

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

10th Amendment to the United States Constitution

I constantly write about the evils of government unbound. Most of that time those comments are directed at a federal government that has ventured far beyond the constraints imposed by the 10th Amendment.

Although the federal government’s excess is often the easiest to see, Uncle Sam is far from the only offender in terms of governments growing too large and too powerful. On the contrary, state and local governments can be (and often are) equally guilty. Local governments use various devices such as zoning ordinances, arbitrary fees and various inspection regimes to impose their power the citizenry. One of the most dubious of those devices is called “certification”.

As bad as a government seeking to control its citizens is, even more pernicious is an industry using the police power of government to line their pockets and stifle competition. This is the true fount of the plague of certification.

Just as the most conservative amongst us understands that there must be some government or society will collapse into anarchy, most Americans understand that there are a number of professions where certification is necessary. For those professions where your life or liberty are at risk, one can make the argument that the state can play an important role in maintaining standards. As such, most states have a variety of certification regimes with which most of us are familiar: Doctors, lawyers, dentists, etc.

The problem however is that certification is not limited only to critical specialties… unless you consider interior design, hair cutting or florists as critical.

Perhaps not so surprising, this “certification” gauntlet is often instigated by the
practitioners of the regulated industry themselves. Seeking to sustain unwarranted pricing power and stifle potential competitors, a cabal of practitioners of a particular profession or industry will form an unofficial governing body for that industry. That body will then lobby state legislators to create a certification regime. That regime will typically include education in the form of schooling or apprenticeship, limits on advertising and may involve regulations about what equipment may or must be used as well as restrictions or requirements as to vehicles or square footage that are allowed.

While these certification requirements typically involve fees paid to the states, in reality the regime is more often than not controlled by the industry cabal. Although the industry’s captains often suggest that their industry requires regulation for public safety reasons, in reality their goal is to protect their members by limiting competition, resulting in higher prices for customers. In practice these governing bodies operate like unions in that they use government regulations to limit the ability of new entrants to compete in the marketplace. What makes this situation particularly noxious is that the advocates of this government intervention typically exempt themselves from having to meet any of the new requirements by including a grandfather clause in the legislation.

The increase in industry certifications has been going on for much of the last half century. The Wall Street Journal reports that in 1950 less than 5% of American jobs were subject to licensure by states. Today that number stands at over 23%.

The result of this industry / state regulatory straitjacket is higher prices for customers, less innovation in industry and higher unemployment across the board. Industry experts often claim that certification protects consumers by keeping unqualified practitioners out of their trades. The question is however, upon what basis does one decide what is a qualified practitioner, and who gets to decide? If flowers are not arranged properly are consumers harmed? If an unlicensed barber takes too much off the top are you permanently scarred? If a bartender pours Grey Goose instead of Absolut is there some permanent pain and suffering?

While the Constitution gives state governments far more latitude than it does the federal government (at least that’s the way it is written…) that does not mean the states should regulate everything simply because they are not barred from doing so. One must ask the question, what is the state interest in certifying masseuses, dog groomers or interior designers?

To the degree conservatives pillory the federal government for its intervention in our lives and economy, we should not ignore state governments and the fact that America’s success was built on free markets, not via a command and control economy.

Free markets work because they are the equivalent of a straight line between two points… i.e. the shortest distance between producer and consumer. Free markets create an environment where consumers are responsible for where they spend their money and entrepreneurs and capitalists are responsible for offering services for which they hope consumers will be willing to pay. To introduce government regulations into that equation is to turn that straight line into a series of unworkable knots.

Without state certification roadblocks, eventually an equilibrium would emerge where consumers choose providers based on various factors such as price, reputation and skill. Certainly some consumers will be unhappy and some merchants would fail, but that’s the beauty of market discipline, it forces both sides to pay attention to the consequences of its actions. Where necessary various private organizations would emerge that would or could provide objective criteria to help consumers make their choices: Consumer Reports, Underwriters Laboratory, Angie’s List, Tripadvisor etc.

This certification plague has interfered with that market discipline and added well over $100 billion a year in inefficiencies to consumer expenditures. Freeing our economy from it’s strictures would not only free up a trillion dollars over a decade, but it would generate a great deal of innovation and dramatically increase consumer choices at the same time.

Now that’s a real stimulus program.

Is a government any less despotic simply because it has not yet chosen to send stormtroopers to your door?

2011-02-07T03:24:00.000-08:00

In the absence of government, anarchy sets in. In the presence of an all powerful government you have totalitarianism. In both cases a man’s attention must be focused on attending to the immediacies necessary for survival. In the former, dangers can be found around any corner as everyone fends for themselves. In the latter, dangers can be found around every corner as the government controls and sees all. When your entire existence is focused on surviving one day to the next, it’s difficult to focus on things like science, leisure or any of the myriad other things we take for granted in civilized society.

As such, the natural condition of human interaction demands governance of some sort in order to have more than simple survival. Government typically starts as a result of groups of individuals seeking to bring order out of chaos who form a governing body of limited power. As time goes by, governments tend to move from one side of the control spectrum to the other as they slowly begin to accumulate more and more power. Eventually a government will become sufficiently oppressive that its subjects revolt. How that revolt plays itself out can take many forms. In some cases it’s an even more brutal regime – think Iran – in some cases it can bring a return to anarchy – the French Revolution – or in others it brings about something in between – the signing of the Magna Carta.

It is from this cauldron of constantly morphing social and governmental forms the United States was born. After the misstep of the Articles of Confederation, the nation found its footing with the Constitution. The beauty of the Constitution was that it was written specifically to limit the power and reach of the government while giving that same government sufficient power to accomplish the tasks delegated to it. Unfortunately, over the last seventy five years the government has blasted through many of those fundamental limitations.

The result has been far too much regulation. When a statist like President Obama says as much in the Wall Street Journal, it must be obvious. Today there are more government regulations than at any point in our history. (Nancy Pelosi and Barack Obama are not solely to blame for this however; after all, Richard Nixon gave us the EPA...) Indeed, before Obama FDR was the patron saint of regulation. Imagine, in 1934 alone the federal government generated over 10,000 pages of new law, four times what had been generated during the combined history of the country’s first 150 years of existence! Today laws with thousands of pages seem to be as common as the Sunday paper.

The problem with all of this? It’s the polar opposite of what our country was founded on in the first place. When it comes to the foundation of the United States, the Declaration of Independence is the why and the Constitution is the how. When government expands across the control spectrum to the point where it regulates (read: controls) everything its citizens do, then the ability of the citizens to pursue the original intent of the founders (Life, Liberty and the Pursuit of Happiness) is lost. And it’s not necessarily the laws themselves but their breadth and incomprehensibility. When one has a tax code that is 60,000 pages the sheer uncertainty of what is legal and the fear of penalty for making the wrong guess can be debilitating.

At what point does a government cross the threshold to be considered totalitarian? If it stops you from speaking? If it stops you from reading or writing books? If it stops you from practicing your religion? Most people would answer yes… obviously. What about if it decides it can tell you how and where you must spend your money? What if it seizes citizen’s property on a whim without providing you with just compensation? What if it suggests you might be a threat to national security simply because you once served in its military? What if it makes laws then exempts its friends from obeying them? If the government can do just about anything it wants, is it any less totalitarian just because its stormtroopers are not yet kicking down your door?

Americans have been bequeathed the greatest gift that any nation has ever been given. Our Constitution, albeit imperfect, provides an unparalleled framework for a nation to grow while almost perfectly sheltering its citizens from the chaos of anarchy or the choke-hold of totalitarianism. Over the last 75 years however, as Americans have been beguiled by the siren song of government protection from all manner of risk, the Constitution has been allowed to fade into a quaint anachronistic set of guidelines rather than a solid foundation for the rule of law. A constitution is merely words on a piece of paper. It can’t stop bullets, it can’t make you happy and it can’t feed your family. Our Constitution is only as strong as those who believe in its words and understand that it is a framework for letting citizens pursue happiness within the balance between anarchy and dictatorship.

Have we as nation become so enamored with government largesse and “protections” that we are unable to see that the distance between a government that recognizes no limits on its law making is not so far from a government that will use its police powers to enforce the resulting legislation? The Tea Party movement suggests that there remain some people who recognize the value of a strong constitution and a limited government. Let’s hope the energy from 2010 can be sustained through 2012 and beyond.

Obama's unconvincing feint to the center

2011-01-24T01:57:00.000-08:00

Reading President Obama’s piece in the Wall Street Journal last week made me think of something Tom Dye, one of my Political Science professors at Florida Sate used to say when discussing the Soviet approach to arms negotiations: “If it’s someone’s goal to kill you, you should not be surprised to discover that they are more than willing to lie about it in the first place.” That basic truth of that statement seems fairly obvious, but it’s a lesson liberals never learned during the Soviet era and President Obama demonstrates he thinks Americans have not learned it today.

He starts off paying homage to the free markets that he rightly acknowledges allowed the United States to become the most prosperous nation in the history of the world. He then goes on to (again accurately) state that it is our entrepreneurial spirit that is the key to our continued leadership in the world.

The remainder of the piece involves his demonstrating for us his understanding that too much government regulation can be a hindrance to those free markets and can suffocate entrepreneurship. He talks about regulatory excess and highlights how agencies can even work at cross purposes to one another. He also discusses his plan to sign an executive order that will instruct federal agencies to reduce excessive regulation, eliminate redundancy and repeal regulations that are obsolete.

The take away from this piece however is that President Obama thinks Americans are incapable of logical thought. He says all the right things, but few people paying attention will believe a word of it.

The President’s stated willingness to destroy the coal industry, his nationalization of the auto industry and his administration’s threats to business leaders who go off script might suggest to a reader that he may not be quite the fan of the free markets as he suggests. It is the 5th paragraph however that puts a lie to the entire piece: Over the past two years, the goal of my administration has been to strike the right balance. And today, I am signing an executive order that makes clear that this is the operating principle of our government.

After rubbing one’s eyes and re-reading that two sentence paragraph then re-checking the byline you have no choice to conclude that either President Obama is a victim of body snatchers or he thinks you were born yesterday. The President’s assertion that his administration has been a model for good governance and balanced regulation is like someone beating you to a pulp and then proclaiming himself a pacifist.

President Obama’s first two years could hardly have been any less balanced had Ralph Nader been sitting in the Oval office. The examples of the President’s duplicity are legion.

His FCC Chairman, Julius Genachowski has moved forward with rules to regulate the Internet despite a court ruling in April explicitly stating the Commission had exceeded its authority.

His EPA, led by Lisa Jackson was a regulation machine. Not only did it seek to regulate CO2 (the stuff we exhale) as a pollutant but it also decided that states that disagreed with its air quality rules (Texas in this case) would simply lose their ability to issue industry permits within its borders.

He appointed a Pay Czar to dictate salaries for private companies, some of whom were forced to take loans from Uncle Sam.

His (recess) appointment of Andy Stern’s right hand man, Craig Becker to the National Labor Relations Board did not suggest a balanced approach to a free market America. Becker once said "employers should have no right to be heard" in cases before the Board, which supervises union elections, investigates labor practices and most ominously, issues rulings that interpret the National Labor Relations Act.

Then there is of course the minor issue of the 159 new bureaucracies, agencies, boards, commissions, and programs that ObamaCare creates, not to mention the myriad mandates such as the one requiring restaurant companies with more than 20 locations to list their nutritional information virtually everywhere but on the toilet paper. Then there are the 1099’s. And of course, not to be forgotten is the unknown number of agencies and regulations that Dodd Frank – one of the most far reaching and incomprehensible financial laws ever passed – will produce. Together these two laws alone – all 4,000 pages of them – will produce strangling regulation for almost 1/4 of our economy.

Given that the beginning of the 2012 election cycle has just begun no one should be surprised that the President is seeking to paint himself as a centrist once again. No doubt his SOTU speech will be full of rhetoric that tacks to the right. It certainly worked well three years ago. Now however, despite a still fawning media, we have demonstrable proof that Barack Obama is nothing but a man of the far left. There’s an old saying: “Trick me once, shame on you; Trick me twice, shame on me.” The question is, how many Americans are going to be sufficiently gullible to take the President’s words at face value and disregard Ronald Reagan’s advice of “Trust but verify?” Hopefully fewer than did in 2008.

Common Sense: The antidote to too much government

2011-01-17T00:54:00.000-08:00

Conservatives and libertarians are constantly railing against government intervention in the lives of citizens. As such, they are often accused by the left of hating all forms of government and seeking to deregulate everything to the point where corporations can take over the country and rob and enslave the citizenry.

Nothing could be farther than the truth. Conservatives understand a successful nation requires a functioning government with a strong rule of law. Without a well functioning government a society devolves into chaos and anarchy. Anarchy in turn usually leads to the rise of a strongman or powerful groups who take control and rule with an iron fist. (See Haiti and the return of Baby Doc or Mexico or Post Soviet Russia) It is not government per-se that conservatives despise; it’s pernicious, inefficient, ineffective and suffocating government.

A husband and wife in Houston who have spent the last year feeding the homeless is feeling the effects of just such a government right now. The city’s Health and Human Services department recently decided to shut the couple down for a lack of permit. Indeed, even the head of a local homeless advocacy group supported the action: “Even though their intentions are good, they ran into ordinances that are designed to protect the public.”

For the couple, Bobby and Amanda Herring, the idea of getting the necessary permits and ensuring that the food (which was often donated by local restaurants or cooked by Amanda in their home) was prepared in “a certified kitchen with a certified food manager” was simply not possible. Their only choice was to work with other properly certified or permitted groups or cease and desist. As of this week the pair were still trying to find a solution.

A spokesman for the HHS stated that the regulations in question are all the more essential in the case of the homeless, because "poor people are the most vulnerable to food borne illness and also are the least likely to have access to health care." So what you have is the government protecting the homeless from the hypothetical danger posed by potentially bad food by imposing the very real condition of taking food away from them. Brilliant.

This episode of course is far from unique. Last summer saw pint sized entrepreneurs in Portland and San Francisco get their lemonade stands shut down for not having the necessary licenses. Nor is it just food. Last week a New Jersey legislator proposed a law requiring registration and license plates for all bicycles - for a fee of course - to protect the elderly from future Lance Armstrongs.

These are perfect examples of bureaucrats fundamentally misunderstanding the function of government. The government cannot and should not try to protect citizens from every possible danger that exists. Why? Simply put, because the number of dangers are infinite. The phrase that comes to mind, if only because its opposite seems to hold sway in the United States today, is “That government is best which governs least.” The phrase, which can be found in Henry David Thoreau’s Civil Disobedience, is sometimes attributed to Thomas Jefferson or Thomas Payne. Regardless of the phrase’s provenance, it seems to be the perfect paradigm for the problems that we face today. Dangers are everywhere and regardless of how many regulations government bureaucrats foist upon the citizenry, most of those dangers will still exist. Bureaucrats are simply not capable of protecting us from all of them, and they should not try. Interestingly, at the very time the governments of Houston, Portland and San Francisco are bullying Good Samaritans and budding entrepreneurs, it appears that Al Qaeda is interested in poising the food in restaurants, one of the most heavily regulated industries in the country.

Conservatives do not argue that there should be no government or regulation, merely that government should be limited and effective in the pursuits it undertakes. The question becomes, what fills the void? Common sense: Sound practical judgment that is independent of specialized knowledge, training, or the like. i.e. things that people figure out through experience, by taking risks, by failing, by watching what goes on around them, from understanding how things function and understanding that actions have consequences. That is the one thing that cannot be legislated, and indeed is something that can actually be regulated out of existence.

Perhaps there is no better example of government action doing just that than the Ft. Hood shooting in early 2010. Common sense would have dictated that a military officer publicly expressing his sympathy for jihadists and the need to kill innocents in the name of Allah would at a minimum be evaluated and had his access to military facilities limited. Instead, officers within the chain of command and others who closely interacted with Major Hassan bit their tongues because of the very real fear of being accused of racism or prejudice and as a result having their careers destroyed. More importantly I suspect, those officers felt confident (again with good reason) that even had they spoken up, nothing would have been done.

In the case of the recent shooting in Tucson, the fact that the shooter purchased his gun legally does not suggest more gun legislation is necessary. Laws already exist to prohibit the mentally unstable from purchasing weapons, and Loughner was certainly that. One question might be: did privacy or civil rights laws keep him from being evaluated and or labeled as such?

The New Year presents conservatives with a moment of opportunity. The GOP has control of the U.S. House, 29 Governor’s mansions and 58 out of the 99 state legislative chambers. Many of the men and women who hold those seats can thank conservatives and Tea Party organizations across the country. If 2012 is going to be another step in the rollback of the progressive agenda smothering the country, conservatives (either via the GOP or over its carcass) will have to stand up and do battle against the perpetually growing bodies of legislation and regulation that effect governments across the country.

Doing so not only requires demonstrating the absurdity of laws already on the books, but at the same time making the argument that government cannot solve every problem any American might ever encounter. Common sense is a muscle. The less it is used the more it atrophies. The more it’s used the stronger it becomes. If the President is so keen on providing benefits to the citizenry, perhaps he can pay for a magical gym membership where members can work on their common sense skills between bench press sets. Now that would be a social program worth paying for.

Liberals see America as a series of problems waiting for government solutions

2011-01-10T01:00:00.000-08:00

In some respects liberals and progressives have it easy. All they have to do is look around and they can find problems for government to solve. Kids are too fat? Let’s get the government to decide how restaurants market their offering. Somebody walked away with a bad haircut? Impose government testing and licensing for barbers. Crime getting out of control? Let’s ban all guns. Someone loses their job? Let’s give them three years of unemployment checks. And just in case there were not enough real problems, liberals try and use government to solve problems that don’t even exist: global warming, disappearing polar bears and widespread discrimination of minorities.

For liberals the country is a boundless universe of problems just waiting for government solutions. The problem with that of course is that the supply of problems is literally endless. Most men are imperfect humans, and until they find a way to fix that, problems will always exist.

It is the ease with which liberals can point to problems and proffer ostensibly reasonable solutions that make it so difficult for conservatives to make headway, particularly with a population that is focused on things like American Idol, Facebook or Xbox. Of course those simplistic solutions often turn out to be anything but simple and more often than not resemble nothing like a solution. As an example, one of the driving forces of the economic malaise we find ourselves in today was the result liberal regulations forcing banks to give mortgages to people who should probably not have had them. Those regulations were government solutions to the “problem” of banks not making enough loans to minorities.

In a world where problems lay below every surface, around every corner and just in plain sight, it’s sometimes difficult to engage voters with a message that we don’t need more government regulation. When a kid is dead in the street of a gunshot wound or a family has lost its health insurance it can be challenging to carry on a rational conversation on the big picture politics of regulation vs. freedom.

Every now and then however a situation comes to light that so starkly discredits the liberal philosophy that even the least engaged citizen almost takes notice. Just such a situation is taking place in California, and it has nothing to do with the state slowly committing economic suicide via untenable regulations and confiscatory tax rates.

The situation to which I’m referring involves the conspiracy amongst environmentalists, the state and the federal governments to turn what is possibly the most fertile land on the planet into a desert wasteland, and take with it tens of thousands of jobs. I’m talking of course about the San Joaquin Valley. The Valley, which occupies much of the center of California from approximately Bakersfield in the south to Sacramento in the north, is the breadbasket of the United States, having in some years produced more than 25% of all the food consumed in the country. It produces everything from grapes to broccoli to tomatoes to rice to pistachios to milk and cream. It’s also a major producer of non food items such as hay and cotton.

In 2008, the Valley, already suffering the effects of a years long drought, was dealt a body blow by the government. That December the U.S. Fish and Wildlife Service issued a “biological opinion" that imposed draconian water reductions on many farms in the San Joaquin Valley. Why? Because California is running out of water? No. Because there’s too much food and they wanted to reduce the supply? Plausible by government standards, but no. No, the government decided to cut off 100% of the water supply (later reduced slightly) of much of the Valley to protect a two inch fish called the delta smelt. The decision was the result of a 2006 lawsuit brought by the environmental group National Resources Defense Council. And the diverted water, is it being sent to other farmers someplace else? No. Is it being held in a giant reservoir for later use? No. It’s being dumped into the San Francisco Bay.

The predictable result of all of this is that not only is a wide swath of some of the most arable land on the planet turning into a dustbowl, but tens of thousands of farm workers are now unemployed and standing in food lines. On the state level, although the Governator claimed that were the decision up to him he would turn the water back on, when he had the opportunity to ask the federal government to review the decision he chose not to.

Not that it had to be this way. The government had much leeway in how it might have approached the “problem” of the delta smelt. Given all of the possible routes the bureaucrats might have taken, they chose the most heavy handed avenue possible and the result has been predictably bad. And it’s not even a matter of depraved indifference. This was a case of regulators actively seeking to advance the environmentalist agenda at the expense of jobs, families and communities. If there were any doubts about that the perniciousness of the government’s actions U.S. District Judge Oliver Wagner put them to rest on the 15th of last month, stating in his decision that the U.S. F&WS had acted in an “arbitrary, capricious and unlawful” manner when issuing their “biological opinion”.

Rarely are the ruinous consequences of progressive / liberal policies as rapid and stark as they are in the dying fields of the San Joaquin Valley. Nonetheless, ruinous they usually are. Be they banking regulations seeking to bring about social change, gun laws seeking to diminish crime or regulations seeking to guarantee every American health insurance coverage, progressives look at the troubled world as a place that must be fixed by government intervention.

Unfortunately, in addition to being pernicious and totalitarian, progressives are also immune to objective evidence of their failures. It doesn’t matter that the outcomes from their policies are usually the exact opposite of their stated objectives or cause irreparable harm to the unwashed masses who actually have to live with them. The only thing that is important is growing government control so that citizens can finally be saved from themselves and the negative consequences of their unenlightened choices.

Democrat Pixie Dust Strangles Jobs

2011-01-03T04:12:00.000-08:00

Last week the fewest jobless claims in 2 ½ years were reported. President Obama and Democrats will likely begin crowing that at long last their policies are beginning to kick in and turn the jobs market around. I'm not so sure. Let’s see how things look in six months as even a blind squirrel trips over a nut every now and then. At the end of the day Democrats are simply ignorant of what it takes to actually create jobs other than those financed by government money, i.e. by taking money away from productive citizens to inefficiently distribute it to others.

The funny thing about jobs is that you don’t find them sitting on a shelf or stuck in a closet. They are not items like tires or boxes or cars. They are not assets you can put into a vault and count and protect and take out whenever you want to use them. No, jobs are dynamic things that exist only in their exercise. Fundamentally jobs are nothing more than energy expended in the pursuit of accomplishing something.

As such, there are private sector jobs and there are public sector jobs. The difference is (besides the fact that public sector jobs pay twice what private sector jobs do…) that jobs in the private sector are typically created when some entrepreneur or investor decides that he or she wants to put their capital at risk for the purpose of growing it, and the vehicle they are choosing for that effort is starting a business. Whether they begin with a great idea they’ve patented, a process they feel they can improve upon or a service they decide customers might be willing to pay for, invariably they look at what it will take to make that business a success.

At a minimum they want to be able to sustain that endeavor and eventually turn a profit. Because of that, most businesses start out small, with owners putting their own time and money into the business. Assuming things go well, at some point the entrepreneur decides they would like to grow, to become bigger and to ideally make more money. A big part of growing most businesses is adding people, particularly at the beginning. This is where President Obama and the Democrats simply loose all connection with reality.

They suggest that government regulation does nothing but protect consumers, make businessmen more honest and generally make society a better place and has no detrimental effect on business decisions. This view is as absurd as their view on taxes. They look at the world of taxes as a static environment. They say that if a 25% tax rate on X raised $4 billion this year, then by raising the rate to 50% next year the government will take in $8 billion. For them taxes operate in a vacuum. They never seem to appreciate the fact that taxpayers have choices and that they respond to incentives. Like Maryland, New York and New Jersey discovered over the last few years, raise taxes and tax payers decide to take their marbles and go play somewhere else.

Obama and the Democrats look at regulation the same way. They assume that jobs too exist in a vacuum and that regardless of what regulations they impose, jobs will eventually return.

The reason for that is simply that in the universe Democrats exist in there is no correlation between profits and jobs. Who votes for Democrats? Union members. Lawyers. Academics, students and intellectuals. Government employees. People on the receiving end of government redistribution programs. Most of those people are beneficiaries of government largesse in one form or another. If it’s not an actual government check it’s government “protections” that allow unions to blackmail businesses, court systems that encourage legal lotteries or loans or grants that sustain the nation’s ivory towers. At the end of the day none of these people has a vested interest in the success of business in America, other than the size of the bank account it creates so it can be looted via the tax code or a class action lawsuit.

Private sector jobs are the backbone of the United States and they always have been. The reason unemployment today stands near 10% is because the people who are responsible for creating private sector jobs are increasingly unsure about the future. Why? Uncertainty about costs.

The cost of a job is not just the paycheck the employee cashes. It includes things like employee recruitment and training, wages, unemployment insurance, employer social security payments, benefits programs and various other employee specific expenses. And those are just the employee specific benefits! Fundamentally an employer needs to assess whether or not an employee will bring more value to the business than it will cost the boss to write all those checks.

As regulation and taxes increase, it raises the bar in terms of what value an employee must bring to the job for a private sector company to hire them. Imagine the direct cost of an employee is $35,000 per year. If regulation and taxes cost the employer an additional $2,000 for that employee, then the employee must generate at a minimum of $37,000 worth of value to that business in order to make that job sustainable. If however regulation and taxes cost the employer $4,000 per employee, then that same employee must generate $39,000 worth of value to sustain that job.

Anyone with a rudimentary understanding of the private sector would recognize that at some point employers, entrepreneurs, investors and other job creators will decide that there is simply no opportunity to make money by creating or sustaining jobs in the United States. They will seek to get more work out of existing employees, they will look for technology to replace employees and when the cost of running a business itself finally becomes prohibitive, they may close up shop altogether and ship their investments and jobs overseas.

A year ago President Obama said “You would be hard pressed to identify a single piece of legislation that we have proposed out there that, net, is not good for business”. Unfortunately for most Americans, they don’t breathe the rarified air Democrats do that allows them to exist in such a fantasy world. Instead they are left to twist in the wind as Democratic regulatory pixie dust chokes the life out of the real American economy.