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I am finally reading Ayn Rand's Fountainhead, over a decade since a friend strongly recommended Rand to me. She has been getting some attention post-bank bailout and as government seems to keep growing, so I wanted to see what people are talking about. I'm about 3/4 through the book's 694 pages. I'm finding a lot to strongly agree with, and some to strongly disagree with.
The book is about Howard Roark, a genius architect who says "Every building is like a person. Single and unrepeatable", and the forces that try to drag him down. A chief adversary is Ellsworth Toohey, a widely-followed and respected newspaper columnist. There is a saying that "The job of the newspaper is to comfort the afflicted and afflict the comfortable." As a "humanitarian", in his sense of the word, Toohey's mission in life is to use his prominence to promote untalented architects and writers, while tearing down the truly talented ones, so they don't achieve total dominence of their professions.
In Toohey's eyes, the power of a critic is best expressed when they take a play that is total crap on the merits and make it a commercial success; the impact of social norms and the desire for acceptance is a big theme in the book. This reminded me of my recent comments about the State of the Union address, and how political pundits (and, sadly journalists) beg their readers to judge the President not strictly on the merits, but on merits, plus a lens of their political parties' priorities and biases.
Years ago when I was studying journalism, I learned that in some cases, journalism students were being explicitly taught methods for positioning the facts to achieve an effect. It doesn't require outright lying. Make more effort to get a quote from one side, while leaving a voice mail for someone on the opposing side ("Calls to the office of Person X were not returned"). Write 10 paragraphs in support up top, with 1 or 2 paragraphs in opposition at the end (Editors know most people don't read the whole article). Put some stories on page 1, and others on page 26.
I learned to consider newspapers and TV news as secondary sources of information, not primary. Thus, I make an effort to watch the State of the Union live, before the press gets a hold of it and applies their lens (I have enough biases of my own). It's a meager attempt to prevent the press from making me see total crap as genius, or vice versa.
The average journalist today is more like Ellsworth Toohey than the average journalist of 5 or 10 years ago, and entire news networks are perceived as having been Tooheyed toward an agenda. Voters assume Fox has a conservative bias, and that MSNBC has a liberal bias, regardless of the actual content on the channel at the moment. They comfort their party and afflict the opposite party. People seek out shows that confirm their own biases and avoid ones that challenge them - which moves them further from the center. This is a large part of why Washington is so dysfunctional.
Many are hoping a new political party will rise and start to take seats in Congress (an example here). I think it would only be a matter of time before the new party becomes like the old. Instead, I hope the growing population of independents remain independent, ignore the Tooheys of the world, and impose discipline on both parties based on their merits. The message of the Scott Brown victory in Massachusetts is "there are a lot of independents in this country, and if you spend too much of their money on things you are not good at doing, we will vote against you." If a large part of the electorate is voting on ideas and not party loyalty, it will force the Federal government to focus only on what they are good at, which isn't very much. Then, please reduce my Federal tax burden and let the States compete for my labor and tax dollars!
Daily Read - 1/29/10
"Nearly half of American households have donated money to help Haiti recover from the recent earthquake. The United States government and other governments around the world, for their part, have sent thousands of relief workers and have pledged $1 billion so far." This NY Times op-ed has some thoughts on Haiti's long-term needs.
To meet the goals Obama set out for trade policy in the SOTU, he would have to "engage in a fight to the death with the liberal wing of his own party, persuade China to allow its currency to appreciate 40 percent, get global economic growth to outperform the salad days from 2003 to 2007, and lower taxes for American companies that do business abroad. And, while he is at it, forget about strengthening the dollar in the foreseeable future." (NY Times, via Yahoo)
Ben Bernanke was confirmed for a second term, upsetting some who thought this was rewarding a "failed policy". However, the Atlantic's Megan McArdle says "what was the alternative? Throwing markets into turmoil as we toss Bernanke aside and start over? What sort of qualified candidates does Senator DeMint think we'll get, after he's punished one of the world's greatest experts on financial crises for, well, being in office when one happened?" (More here)
Keith Hennessey has an excellent post (as usual) about how government efforts to create jobs typically don't provide much bang for the buck, and how this is a big political problem for a President who is expected to do something about our high unemployment rates, in spite of massive deficits.
Peggy Noonan's "The Obama Contradiction" is that "Washington is sick and broken—and it can solve all our problems" (WSJ, here) About the SOTU: "It was a speech that argued against itself: You need us to heal you. Don't trust us, we think of no one but ourselves."
On Tuesday, voters in Oregon passed two tax measures in an effort to close their budget deficit: "Measure 66 increases Oregon's personal-income-tax rate by two percentage points for households earning over $250,000 a year. Measure 67 calls for an increase in the state's minimum corporate income tax, currently $10 a year, and imposes a tax on gross revenues for corporations that don't report a profit." (WSJ)
Measures 66 and 67 were opposed by many, including Nike founder Phil Knight, who says "Measures 66 and 67 should be labeled Oregon's Assisted Suicide Law II" because "These measures would give Oregon the highest income tax rates in the country." "The state in past years was headquarters for The First National Bank, US Bank, Pacific Power, Willamette Industries, Georgia-Pacific, Jantzen, White Stag, G.I. Joe's, Monaco Coach, Meier & Frank, among many others. They are now headquartered elsewhere, are controlled by non-Oregonians or no longer exist. "
Even Paul Krugman (here) thinks the President is using "fiscal responsibility" merely to score political points.
Krauthammer provides an example of bipartisanship in Washington - "a letter from six senators -- three Republicans, two Democrats and Joe Lieberman -- asking Attorney General Eric Holder to reverse the decision" to give Khalid Sheik Mohammed a civilian trial in New York. We have been attacked by terrorists three times within the US during Obama's presidency: "twice with effect (the Arkansas killer and the Fort Hood shooter) and once with a shockingly near miss (Abdulmutallab)."
To meet the goals Obama set out for trade policy in the SOTU, he would have to "engage in a fight to the death with the liberal wing of his own party, persuade China to allow its currency to appreciate 40 percent, get global economic growth to outperform the salad days from 2003 to 2007, and lower taxes for American companies that do business abroad. And, while he is at it, forget about strengthening the dollar in the foreseeable future." (NY Times, via Yahoo)
Ben Bernanke was confirmed for a second term, upsetting some who thought this was rewarding a "failed policy". However, the Atlantic's Megan McArdle says "what was the alternative? Throwing markets into turmoil as we toss Bernanke aside and start over? What sort of qualified candidates does Senator DeMint think we'll get, after he's punished one of the world's greatest experts on financial crises for, well, being in office when one happened?" (More here)
Keith Hennessey has an excellent post (as usual) about how government efforts to create jobs typically don't provide much bang for the buck, and how this is a big political problem for a President who is expected to do something about our high unemployment rates, in spite of massive deficits.
Peggy Noonan's "The Obama Contradiction" is that "Washington is sick and broken—and it can solve all our problems" (WSJ, here) About the SOTU: "It was a speech that argued against itself: You need us to heal you. Don't trust us, we think of no one but ourselves."
On Tuesday, voters in Oregon passed two tax measures in an effort to close their budget deficit: "Measure 66 increases Oregon's personal-income-tax rate by two percentage points for households earning over $250,000 a year. Measure 67 calls for an increase in the state's minimum corporate income tax, currently $10 a year, and imposes a tax on gross revenues for corporations that don't report a profit." (WSJ)
Measures 66 and 67 were opposed by many, including Nike founder Phil Knight, who says "Measures 66 and 67 should be labeled Oregon's Assisted Suicide Law II" because "These measures would give Oregon the highest income tax rates in the country." "The state in past years was headquarters for The First National Bank, US Bank, Pacific Power, Willamette Industries, Georgia-Pacific, Jantzen, White Stag, G.I. Joe's, Monaco Coach, Meier & Frank, among many others. They are now headquartered elsewhere, are controlled by non-Oregonians or no longer exist. "
Even Paul Krugman (here) thinks the President is using "fiscal responsibility" merely to score political points.
Krauthammer provides an example of bipartisanship in Washington - "a letter from six senators -- three Republicans, two Democrats and Joe Lieberman -- asking Attorney General Eric Holder to reverse the decision" to give Khalid Sheik Mohammed a civilian trial in New York. We have been attacked by terrorists three times within the US during Obama's presidency: "twice with effect (the Arkansas killer and the Fort Hood shooter) and once with a shockingly near miss (Abdulmutallab)."
Why AIG Was Saved
An article on the WSJ's opinion page says the AIG hearings in Washington "showed that the story of why AIG could not be allowed to fail continues to change, which inspires little confidence that Washington can be trusted with new powers to identify and address systemic risk."
The best illustration I've seen of why AIG had to be saved is this chart from the IMF. The arrows show the % change in default risk of an institution, if the institution the arrow is pointing at defaulted. For example, if AIG defaulted, Bank of America was 4.56 times as likely to default. If AIG had gone under, the US government may have ended up in the position of backing up consumer deposits at Bank of America, Wells, Fargo, Wachovia, Citigroup, etc. The FDIC doesn't have nearly enough reserves to take care of that. By bailing out "Wall Street" (many of these institutions are not part of Wall Street, but politicians refer to them as such), the US government essentially bailed out Main Street. However, demonizing "Wall Street" is a message that gets more votes.
The best illustration I've seen of why AIG had to be saved is this chart from the IMF. The arrows show the % change in default risk of an institution, if the institution the arrow is pointing at defaulted. For example, if AIG defaulted, Bank of America was 4.56 times as likely to default. If AIG had gone under, the US government may have ended up in the position of backing up consumer deposits at Bank of America, Wells, Fargo, Wachovia, Citigroup, etc. The FDIC doesn't have nearly enough reserves to take care of that. By bailing out "Wall Street" (many of these institutions are not part of Wall Street, but politicians refer to them as such), the US government essentially bailed out Main Street. However, demonizing "Wall Street" is a message that gets more votes.
More on the State of the Union
In the end, the State of the Union address was a long speech about how government is the way to address all of the many problems facing our country. I would have preferred Obama to say that "We are strong, we are resilient, we are American," and that the "spirit of determination and optimism" of Americans means they need less, not more, government "help". Basically, more of this, this, and this would have been better, and far less of the obvious, two-faced contradictions ("I will not give up on trying to change the tone of our politics", followed later by "let's put aside the schoolyard taunts" -- comparing your opposition to children is not going to improve the tone in Washington).
This is what I like least about the SOTU - it begs you to judge the speaker, not on policy and ideas, but on things that are immaterial to the well-being of the country, like reading words other people wrote from a teleprompter, and that are open to vastly different interpretations:
Example 1: To Richard Cohen in the Washington Post, Obama was "moderate", had "poise", "self-confidence", and "seemed the only adult in the room." "He conjured up a Washington where things once worked."
Example 2: To Jonah Goldberg in the NY Post, Obama had "supreme arrogance", a "distinctly unpresidential whine " while arguing "anyone who feels differently hasn't heard or understood the president's explanations." "Aside from a few throwaway lines of self-deprecation, whenever he grew passionate, it was to blame others."
This is what I like least about the SOTU - it begs you to judge the speaker, not on policy and ideas, but on things that are immaterial to the well-being of the country, like reading words other people wrote from a teleprompter, and that are open to vastly different interpretations:
Example 1: To Richard Cohen in the Washington Post, Obama was "moderate", had "poise", "self-confidence", and "seemed the only adult in the room." "He conjured up a Washington where things once worked."
Example 2: To Jonah Goldberg in the NY Post, Obama had "supreme arrogance", a "distinctly unpresidential whine " while arguing "anyone who feels differently hasn't heard or understood the president's explanations." "Aside from a few throwaway lines of self-deprecation, whenever he grew passionate, it was to blame others."
Daily Read - 1/28/10
Thoughts on the State of the Union are here, and here.
Prior to the speech, Paul Begala said the President needs to "blast the opposition party," calling this "the Republican Recession." Ok - so some Republicans are to blame for the crisis, but so were a whole bunch of other people. Does a call to increase the partisanship really help anyone? (other than partisan advisors)
Elizabeth McDonald, writing on Fox Business, "found $900 billion to $1.5 trillion worth of ways to trim the fat marbled throughout government. And these are items that government officials say should be cut." Instead of creating a commission that would take a year to study ways to cut spending, can we just pick a few ideas that are already out there? For example, "The government owns and leases 3.87 billion square feet of property, and 55.7 million acres of land—meaning, one out of every forty acres." Do they need it all?
Ever heard of "cohesive capitalism"? At the World Economic Forum in Davos, they are discussing this "system that would try to ensure benefits of growth are shared more widely but that is led by the business world." The discussion "won't produce a firm blueprint for a shiny new economic model but it does aim to get the debate moving." I thought the debate, like this one, has been going on for quite a while?
"Ford Motor reported its first full-year profit since 2005 and said it expects to be profitable again in 2010." And without a government bailout! Does this mean they will be punished for their success? (CNN Money)
Meanwhile, "Toyota says it is adding another 1.1 million vehicles to an an earlier 4.2 million vehicle recall originally announced in November, and extending a second recall to Europe." This slip-up will likely help the US auto industry far more than cash-for-clunkers and all the other government assistance combined. (CNN Money)
Is it ironic that "Las Vegas had the largest number of foreclosure filings of any city last year"? (CNN Money) I wonder about the effects of the government's decision to create a "blacklist of banned destinations" and stay away from trips to Vegas, even if they cost less, for purposes of perception. (WSJ)
Prior to the speech, Paul Begala said the President needs to "blast the opposition party," calling this "the Republican Recession." Ok - so some Republicans are to blame for the crisis, but so were a whole bunch of other people. Does a call to increase the partisanship really help anyone? (other than partisan advisors)
Elizabeth McDonald, writing on Fox Business, "found $900 billion to $1.5 trillion worth of ways to trim the fat marbled throughout government. And these are items that government officials say should be cut." Instead of creating a commission that would take a year to study ways to cut spending, can we just pick a few ideas that are already out there? For example, "The government owns and leases 3.87 billion square feet of property, and 55.7 million acres of land—meaning, one out of every forty acres." Do they need it all?
Ever heard of "cohesive capitalism"? At the World Economic Forum in Davos, they are discussing this "system that would try to ensure benefits of growth are shared more widely but that is led by the business world." The discussion "won't produce a firm blueprint for a shiny new economic model but it does aim to get the debate moving." I thought the debate, like this one, has been going on for quite a while?
"Ford Motor reported its first full-year profit since 2005 and said it expects to be profitable again in 2010." And without a government bailout! Does this mean they will be punished for their success? (CNN Money)
Meanwhile, "Toyota says it is adding another 1.1 million vehicles to an an earlier 4.2 million vehicle recall originally announced in November, and extending a second recall to Europe." This slip-up will likely help the US auto industry far more than cash-for-clunkers and all the other government assistance combined. (CNN Money)
Is it ironic that "Las Vegas had the largest number of foreclosure filings of any city last year"? (CNN Money) I wonder about the effects of the government's decision to create a "blacklist of banned destinations" and stay away from trips to Vegas, even if they cost less, for purposes of perception. (WSJ)
Stray Thoughts During the SOTU on CNN
Is it odd how the State Of The Union gives the impression that Congress is somehow subordinate to the President? Technically, they are equals. Congress does not work for the President.
As everyone was walking in, CNN said Sonia Sotomayor was one of Obama's successes during his first year. Is it a little early to declare her a success as a Justice?
He's about to start - is this speech #412, or #413...?
Obama just announced several results of the depression, then said these are the reason he ran for President. However, he started running for President far before the recession hit.
Congress is applauding that Obama is "hopeful". Is that news?
The purpose of the bank bailouts was to make the financial system healthy again. Why is Obama now intent on punishing them for doing what they were supposed to do?
After talking about cutting taxes, Obama says "I thought I'd get some applause on that one."
Harry Reid was just caught on camera yawning.
Obama says we should invest in small business lending - by re-using TARP money that has been repaid. Is that even legal?
Obama is addressing a Democrat-controlled Congress and complaining about political gridlock.
Obama still says "real reform" of the financial system means preventing banks from failing - preventing them from taking too many risks. Does this mean they can count on another round of government bailouts if they follow whatever new rules are passed? (When they get around to it)
Obama says he didn't take on health care "because it was good politics." However, if you look back at the polls, it was a popular issue when he was elected, so it was good politics...until Congress and the President started trying to address it...and he admitted it: "The longer it was debated, the more skeptical people became."
"Freeze government spending for 3 years" (starting next year, "after the economy recovers") - He says this after proposing a multitude of spending initiatives, and making no mention of entitlement reform (~60% of government spending)
I just noticed how his red-and-white striped tie matches the flag behind him.
Obama says we need to keep the cost of borrowing down to help businesses. Does he not realize that attacking the financial industry will inevitably increase the cost of borrowing?
Obama will be "addressing" Republican leadership soon. Again, treating Congress like they report to him.
I like how he puts the repeated blaming of the previous administration and Congress in one part of the speech, and the part where he says this is not about the past much later on.
Obama is supporting expansion of the VA and more help for military families, which I support. Fortunately, these are parts of government outside his "spending freeze."
I think Obama is making Biden cry.
US aid to Haiti does not inspire my faith in American government, as Obama suggests, it inspires hope in American people, as private individuals.
Speech is over. I really wish he would have seemed more aware of his plummeting poll numbers, and at least taken a little blame. In the midst of a recession and 10% unemployment, he is sticking to the "change is not easy" lines.
Virginia's new governor, Bob McDonnell, is about to respond...
Is a governor giving the response a subtle hint that the Federal government is getting too big, and more attention should be given to local governments?
Also, McDonnell is not up for re-election.
The President refers to a "freeze", then elaborates. The response refers immediately to a "partial freeze". Spin; then anti-spin.
Solutions.gop.gov - good plug. We'll see if ideas from there get serious attention, or are used.
As everyone was walking in, CNN said Sonia Sotomayor was one of Obama's successes during his first year. Is it a little early to declare her a success as a Justice?
He's about to start - is this speech #412, or #413...?
Obama just announced several results of the depression, then said these are the reason he ran for President. However, he started running for President far before the recession hit.
Congress is applauding that Obama is "hopeful". Is that news?
The purpose of the bank bailouts was to make the financial system healthy again. Why is Obama now intent on punishing them for doing what they were supposed to do?
After talking about cutting taxes, Obama says "I thought I'd get some applause on that one."
Harry Reid was just caught on camera yawning.
Obama says we should invest in small business lending - by re-using TARP money that has been repaid. Is that even legal?
Obama is addressing a Democrat-controlled Congress and complaining about political gridlock.
Obama still says "real reform" of the financial system means preventing banks from failing - preventing them from taking too many risks. Does this mean they can count on another round of government bailouts if they follow whatever new rules are passed? (When they get around to it)
Obama says he didn't take on health care "because it was good politics." However, if you look back at the polls, it was a popular issue when he was elected, so it was good politics...until Congress and the President started trying to address it...and he admitted it: "The longer it was debated, the more skeptical people became."
"Freeze government spending for 3 years" (starting next year, "after the economy recovers") - He says this after proposing a multitude of spending initiatives, and making no mention of entitlement reform (~60% of government spending)
I just noticed how his red-and-white striped tie matches the flag behind him.
Obama says we need to keep the cost of borrowing down to help businesses. Does he not realize that attacking the financial industry will inevitably increase the cost of borrowing?
Obama will be "addressing" Republican leadership soon. Again, treating Congress like they report to him.
I like how he puts the repeated blaming of the previous administration and Congress in one part of the speech, and the part where he says this is not about the past much later on.
Obama is supporting expansion of the VA and more help for military families, which I support. Fortunately, these are parts of government outside his "spending freeze."
I think Obama is making Biden cry.
US aid to Haiti does not inspire my faith in American government, as Obama suggests, it inspires hope in American people, as private individuals.
Speech is over. I really wish he would have seemed more aware of his plummeting poll numbers, and at least taken a little blame. In the midst of a recession and 10% unemployment, he is sticking to the "change is not easy" lines.
Virginia's new governor, Bob McDonnell, is about to respond...
Is a governor giving the response a subtle hint that the Federal government is getting too big, and more attention should be given to local governments?
Also, McDonnell is not up for re-election.
The President refers to a "freeze", then elaborates. The response refers immediately to a "partial freeze". Spin; then anti-spin.
Solutions.gop.gov - good plug. We'll see if ideas from there get serious attention, or are used.
In Sports: The Obama Effect?
The LA Lakers visited the White House and met President Obama on Monday, which "was a good substitute for a ho-hum January practice, and they promptly lifted their road doldrums" as they beat the Washington Wizards 115-103 on Tuesday. (Baltimore Sun)
On Tuesday, Kentucky Wildcats coach John Calipari and freshman phenom John Wall got a call from President Obama "to congratulate the Cats on the "Hoops for Haiti" program that raised more than $1 million for disaster relief efforts in Haiti". (USA Today) Tuesday night, the No. 1-ranked Wildcats lost their first game this season to unranked South Carolina.
So, either Obama has no effect on sports outcomes, or the effect is only good when you meet him in person.
On Tuesday, Kentucky Wildcats coach John Calipari and freshman phenom John Wall got a call from President Obama "to congratulate the Cats on the "Hoops for Haiti" program that raised more than $1 million for disaster relief efforts in Haiti". (USA Today) Tuesday night, the No. 1-ranked Wildcats lost their first game this season to unranked South Carolina.
So, either Obama has no effect on sports outcomes, or the effect is only good when you meet him in person.
Hedge Fund Manager Asness Responds to Obama's War on Banks
Hedge fund manager Cliff Asness is "Appalled in Greenwich Connecticut" (the title of his post outlining the problems he sees with Obama singling out "banks" for punishment). His main point is that many, many parties were responsible for the economic crisis, and the solution is less government interaction, not more. "Punish failure. Don’t institutionalize too-big-to-fail by accepting it and then try to regulate away large failures with telephone books of rules and coercive government interference."
Here's his recap, but the entire post is well worth reading:
Here's his recap, but the entire post is well worth reading:
The bankers are far from without sin, and there are things in the system that need fixing. But the bankers have largely paid back what they borrowed and should not be penalized versus those who cannot repay, simply because the bankers performed well post bailout (wasn’t that the hope and intention?). Bankers didn’t cause this crisis any more than individuals did, and probably less than government. But those last two are inconvenient villains.
Asness, a libertarian, occasionally posts such enlightening and amusing rants at his website http://www.stumblingontruth.com/
Insurance Doesn't Always Have to be a Government Program
The story of Vic Chesnutt, a singer-songwriter who died in December, has been circulating on the internet. He had been in a coma for some time, the cause of which is uncertain, but is rumored to be the result of a suicide attempt. He struggled with depression much of his life, partly due to a car accident that made him a paraplegic at a young age.
Chesnutt was also facing $70,000 in medical bills, and some groups have picked him up as a poster child for Americans who die because of a lack of health insurance.
"Insurance" is simply a mechanism for sharing costs and risks across a group of people - it doesn't require a complicated corporation or government program. Chesnutt was a minor celebrity - was he really unable (or unwilling) to raise $70,000 from other, willing Americans? Americans are proving themselves to be generous - look at all the millions flowing into Haiti every day.
In his acceptance speech in Grant Park last year, President Obama said "we know that government cant solve every problem" and "let us summon a new spirit of patriotism; of service and responsibility where each of us resolves to pitch in and work harder and look after not only ourselves, but each other."
Wouldn't it be wonderful if Obama used his State of the Union address to tell Americans not to wait for government to solve their problems...to tell Americans that sometimes people don't die from lack of health insurance - they sometimes die from lack of a community where people reach out and help each other - directly, with no government program telling them they must.
I'm sure Obama can find other words, but "my fellow Americans: ask not what your country can do for you - ask what you can do for your country" would be a good sentiment right now.
Chesnutt was also facing $70,000 in medical bills, and some groups have picked him up as a poster child for Americans who die because of a lack of health insurance.
"Insurance" is simply a mechanism for sharing costs and risks across a group of people - it doesn't require a complicated corporation or government program. Chesnutt was a minor celebrity - was he really unable (or unwilling) to raise $70,000 from other, willing Americans? Americans are proving themselves to be generous - look at all the millions flowing into Haiti every day.
In his acceptance speech in Grant Park last year, President Obama said "we know that government cant solve every problem" and "let us summon a new spirit of patriotism; of service and responsibility where each of us resolves to pitch in and work harder and look after not only ourselves, but each other."
Wouldn't it be wonderful if Obama used his State of the Union address to tell Americans not to wait for government to solve their problems...to tell Americans that sometimes people don't die from lack of health insurance - they sometimes die from lack of a community where people reach out and help each other - directly, with no government program telling them they must.
I'm sure Obama can find other words, but "my fellow Americans: ask not what your country can do for you - ask what you can do for your country" would be a good sentiment right now.
Daily Read - 1/27/10
Politico reports on CBO's prediction of a $1.35 trillion deficit this year. "“Interest payments on the debt are poised to skyrocket,” CBO says. From 2010 through 2020, it projects the annual costs will triple in nominal terms from $207 billion to $723 billion and more than double as a share of GDP."Meanwhile, "The Senate on Tuesday rejected a plan to create a bipartisan commission to tackle the nation's budget problems." Senate Budget Committee Chairman Kent Conrad (D-ND) says "there is a growing and now majority support for taking on the debt." (Washington Post) It's Congress' job to spend wisely and set priorities. What do we need a commission for? (See also here)
In Newsweek, Robert Samuelson points out Obama's proposed spending freeze amounts "to about a sixth of the federal budget" and "would be mostly a rounding error in the decade’s projected deficits." Plus a little reminder that entitlements are the bigger issue - "As the recession’s impact wanes, deficits do decline but an aging population—which raises spending on Social Security and Medicare—keeps them high."
"Companies will be required to give the IRS a concise description of the reasoning behind "uncertain tax positions" and the amount of money riding on each of them," to make audits easier and more efficient for the IRS to perform. (Washington Post) Apparently collecting taxes is so difficult and complicated that the IRS needs enforcement help from the taxpayer, at their time and expense. I have a better idea to make audits easier - simplify the tax code!
Obama is smarter than you - and don't forget it! In the Washington Post, David Axelrod says Obama "is someone who in law school worked with [Harvard professor] Larry Tribe on a paper on the legal implications of Einstein's theory of relativity." Not sure how that's relevant to anything at all, but whatever.
Children in Massachusetts day care centers are now subject to mandatory toothbrushing. Really. (Boston.com, here; Hat tip here) Another case of parenting being done vicariously through unfeeling government bureaucracies.
State of the Union - Judging a Book By Its Cover
From Gene Healy in the Washington Examiner (here):
So, if voters weren't judging their Presidents on their ability to deliver words from a teleprompter, what were they judging them on?for most of the Republic's first century, the [State of the Union] was a modest, informational affair. Presidents sent the written address to Congress, to be read aloud by a clerk. That was thanks to President Jefferson, who thought delivering the speech before Congress assembled smacked too much of a king's "Speech from the Throne."
A $1.1 Million Trip to Copenhagen
CBS News reports that the government spent over $1.1 million sending over 60 people to the Copenhagen Climate Summit in Denmark . "Those who stayed just two nights were charged a six-night minimum at the five-star Marriott. One staffer said, they strongly objected to no avail. You may ask how they'll negotiate a climate treaty, if they can't get a better deal on hotel rooms."
How Obama Will Raise Taxes Without Raising Taxes
The chart to the right shows how, under current law, the CBO projects government revenue to look. So, by doing nothing, the Obama administration can raise taxes simply by letting existing tax provisions expire.
Is Obama Principled or Pandering?
President Obama told ABC's Diane Sawyer that "I'd rather be a really good one-term president than a mediocre two-term president." "You know, there is a tendency in Washington to believe our job description, of elected officials, is to get reelected. That's not our job description," Obama said. "Our job description is to solve problems and to help people."
If the only reason people think the job of a politician is to get reelection is cynicism, then Obama is making a strong, principled statement here. However, he is not a king. Obama is serving in a representative democracy, which means that Obama's job is to solve the problems that the voters want him to solve, not the ones that he, in his apparently lofty wisdom, decide need to be solved. Therefore, his job is to get reelected, because in a democracy that is ultimately how the people tell Obama whether he did his job or not.
Obama campaigned on a staggering multitude of issues, promises, and expectations, many of which were contradictory, and therefore went into office with a multitude of constituencies. He was expected to solve a lot of problems and help a lot of people, at no cost to anyone. During his time in office, he has inevitably let people down, and turned his back on many constituents. If Obama is being principled now, which constituencies' principles is he standing on, and which is he rejecting? On health care reform, he has chosen to pander to the political left, while simultaneously, and quite obviously, telling independents to take a hike because he intends to get it done before they can vote him out of office.
Think of it as a 'principled' way of flipping independents the bird.
If the only reason people think the job of a politician is to get reelection is cynicism, then Obama is making a strong, principled statement here. However, he is not a king. Obama is serving in a representative democracy, which means that Obama's job is to solve the problems that the voters want him to solve, not the ones that he, in his apparently lofty wisdom, decide need to be solved. Therefore, his job is to get reelected, because in a democracy that is ultimately how the people tell Obama whether he did his job or not.
Obama campaigned on a staggering multitude of issues, promises, and expectations, many of which were contradictory, and therefore went into office with a multitude of constituencies. He was expected to solve a lot of problems and help a lot of people, at no cost to anyone. During his time in office, he has inevitably let people down, and turned his back on many constituents. If Obama is being principled now, which constituencies' principles is he standing on, and which is he rejecting? On health care reform, he has chosen to pander to the political left, while simultaneously, and quite obviously, telling independents to take a hike because he intends to get it done before they can vote him out of office.
Think of it as a 'principled' way of flipping independents the bird.
Daily Read - 1/26/10
Obama is expected to propose a three-year freeze on discretionary federal spending. I hope he means it.
"Nearly three out of four Americans think that at least half of the money spent in the federal stimulus plan has been wasted, according to a new national poll," reported by CNN. Also, "4 percent think that no stimulus dollars have been wasted." Really? 4% of Americans think the government could spend hundreds of billions without wasting anything? Even Warren Buffett, an Obama supporter knows the stimulus bill was "8000 earmarks or something".
Apparently Obama believes in his own cult of personality. Politico reports comments made by retiring Rep. Marion Berry (D-Ark) that Obama thought Democrats could pass health care and not face political consequences because "Well, the big difference here and in ’94 was you’ve got me."
"More than 300 people and groups have sued the Obama administration fighting to get federal government records in the year since President Obama pledged his administration would be the most open in history" (Washington Post)
Reuters reports that New Jersey's Treasury Department "should be freed from union constraints that hobble its operations." "New Jersey's pension fund is the only one in the nation barred from hiring outside fund managers under a court settlement that unionized workers won."
Thomas Sowell says "If politicians can't do anything else right, they can count votes." (RCP)
David Brooks says "Ever since I started covering politics, the Democratic ruling class has been driven by one fantasy: that voters will get so furious at people with M.B.A.’s that they will hand power to people with Ph.D.’s. The Republican ruling class has been driven by the fantasy that voters will get so furious at people with Ph.D.’s that they will hand power to people with M.B.A.’s. Members of the ruling class love populism because they think it will help their section of the elite gain power." Then he argues that the US was founded by "anti-populists" who "rejected the zero-sum mentality that is at the heart of populism, the belief that economics is a struggle over finite spoils." (NY Times)
Richard Thaler, writing in the New York Times, wonders why so many Americans who owe more than their home is worth "are dutifully continuing to pay their mortgages, despite substantial financial incentives for walking away from them." Despite using the word "duty" in this sentence, he goes on about why the default rate isn't higher.
Obama's plan to let employees automatically enroll in direct-deposit retirement accounts and expand matching tax credits may meet resistance from small businesses. Many small businesses are struggling in this economy, and this program would create a new cost and administrative burden for them. Also, “I don’t know that there’s been enough thought to how certain small businesses, restaurants in particular, would comply with this if they don’t use a payroll company or participate in direct deposits,” said Molly Brogan, vice president of public affairs for the National Small Business Association. (Bloomberg)
However, Apple continues to make tons of money, demonstrating that some people can still afford really expensive products, even in this recession.
"Nearly three out of four Americans think that at least half of the money spent in the federal stimulus plan has been wasted, according to a new national poll," reported by CNN. Also, "4 percent think that no stimulus dollars have been wasted." Really? 4% of Americans think the government could spend hundreds of billions without wasting anything? Even Warren Buffett, an Obama supporter knows the stimulus bill was "8000 earmarks or something".
Apparently Obama believes in his own cult of personality. Politico reports comments made by retiring Rep. Marion Berry (D-Ark) that Obama thought Democrats could pass health care and not face political consequences because "Well, the big difference here and in ’94 was you’ve got me."
"More than 300 people and groups have sued the Obama administration fighting to get federal government records in the year since President Obama pledged his administration would be the most open in history" (Washington Post)
Reuters reports that New Jersey's Treasury Department "should be freed from union constraints that hobble its operations." "New Jersey's pension fund is the only one in the nation barred from hiring outside fund managers under a court settlement that unionized workers won."
Thomas Sowell says "If politicians can't do anything else right, they can count votes." (RCP)
David Brooks says "Ever since I started covering politics, the Democratic ruling class has been driven by one fantasy: that voters will get so furious at people with M.B.A.’s that they will hand power to people with Ph.D.’s. The Republican ruling class has been driven by the fantasy that voters will get so furious at people with Ph.D.’s that they will hand power to people with M.B.A.’s. Members of the ruling class love populism because they think it will help their section of the elite gain power." Then he argues that the US was founded by "anti-populists" who "rejected the zero-sum mentality that is at the heart of populism, the belief that economics is a struggle over finite spoils." (NY Times)
Richard Thaler, writing in the New York Times, wonders why so many Americans who owe more than their home is worth "are dutifully continuing to pay their mortgages, despite substantial financial incentives for walking away from them." Despite using the word "duty" in this sentence, he goes on about why the default rate isn't higher.
Obama's plan to let employees automatically enroll in direct-deposit retirement accounts and expand matching tax credits may meet resistance from small businesses. Many small businesses are struggling in this economy, and this program would create a new cost and administrative burden for them. Also, “I don’t know that there’s been enough thought to how certain small businesses, restaurants in particular, would comply with this if they don’t use a payroll company or participate in direct deposits,” said Molly Brogan, vice president of public affairs for the National Small Business Association. (Bloomberg)
However, Apple continues to make tons of money, demonstrating that some people can still afford really expensive products, even in this recession.
Daily Read - 1/25/10
The New Orleans Saints are on their way to the Super Bowl. Good news for a town that could use a morale boost.
A 7-year-old boy from London has raised more than $161,000 for Haiti relief! Charlie Simpson "had hoped to raise just £500 for UNICEF's earthquake appeal by cycling eight kilometers (five miles) around a local park." (CNN, here)
Barney Frank is considering "abolishing Fannie Mae and Freddie Mac in their current form and coming up with a whole new system of housing finance," according to a Boston Globe article. Under any new system "any entities receiving government backing would need to be more heavily regulated to limit risk, with greater product restrictions on mortgage-backed securities and higher capital than what Fannie and Freddie had," says David Min, an associate director for the Center for American Progress. Would the new system include provisions to prevent Barney Frank and other politicians from pressuring lenders to lower standards so they can campaign for re-election on the platform of increasing homeownership? Would the new system provide stiffer penalties for people who fail to pay their mortgage, or would it just penalize taxpayers and/or Wall Street?
The government is in a precarious position. The removal of more than $1 trillion of support for the mortgage market is "a momentous test of whether the Obama administration and the Federal Reserve have succeeded in jump-starting the housing market and ensuring it can hold its own. The stakes for the economy are massive: If the market again falls into a tailspin, homeowners could face another wave of trouble." (Washington Post, here)
James Carville argues in the Financial Times that Democrats haven't blamed Bush enough. Instead of trying to "march forward in a new post-partisan environment", Carville suggests Obama should carry on with a far-left agenda because "Nothing can change Washington." I guess he thinks hope and change are dead.
Here's an interesting chart (right) from the USA Today's article on how government spending cannot be significantly changed without doing something about entitlement programs.
Meanwhile, Obama intends to use his State of the Union address this Wednesday to announce that middle-class Americans are entitled to twice as much of a tax break for having children, forgiveness for portions of their student loans, and a taxpayer-subsidized employer-based retirement plan (Washington Post, here)
James Sherk of the Heritage Foundation is on the WSJ's opinion page today says "typical union member now works in the Post Office, not on the assembly line," and discusses some possible implications.
A 7-year-old boy from London has raised more than $161,000 for Haiti relief! Charlie Simpson "had hoped to raise just £500 for UNICEF's earthquake appeal by cycling eight kilometers (five miles) around a local park." (CNN, here)
Barney Frank is considering "abolishing Fannie Mae and Freddie Mac in their current form and coming up with a whole new system of housing finance," according to a Boston Globe article. Under any new system "any entities receiving government backing would need to be more heavily regulated to limit risk, with greater product restrictions on mortgage-backed securities and higher capital than what Fannie and Freddie had," says David Min, an associate director for the Center for American Progress. Would the new system include provisions to prevent Barney Frank and other politicians from pressuring lenders to lower standards so they can campaign for re-election on the platform of increasing homeownership? Would the new system provide stiffer penalties for people who fail to pay their mortgage, or would it just penalize taxpayers and/or Wall Street?
The government is in a precarious position. The removal of more than $1 trillion of support for the mortgage market is "a momentous test of whether the Obama administration and the Federal Reserve have succeeded in jump-starting the housing market and ensuring it can hold its own. The stakes for the economy are massive: If the market again falls into a tailspin, homeowners could face another wave of trouble." (Washington Post, here)
James Carville argues in the Financial Times that Democrats haven't blamed Bush enough. Instead of trying to "march forward in a new post-partisan environment", Carville suggests Obama should carry on with a far-left agenda because "Nothing can change Washington." I guess he thinks hope and change are dead.
Here's an interesting chart (right) from the USA Today's article on how government spending cannot be significantly changed without doing something about entitlement programs.
Meanwhile, Obama intends to use his State of the Union address this Wednesday to announce that middle-class Americans are entitled to twice as much of a tax break for having children, forgiveness for portions of their student loans, and a taxpayer-subsidized employer-based retirement plan (Washington Post, here)
James Sherk of the Heritage Foundation is on the WSJ's opinion page today says "typical union member now works in the Post Office, not on the assembly line," and discusses some possible implications.
What I'm Reading - 1/24/10
"Friday night's star-studded "Hope for Haiti" telethon has raised a record-breaking $58 million, with more donations continuing to pour in from around the world, the benefit's organizers announced Saturday. The preliminary figure is a record for donations made by the public through a disaster relief telethon, according to a news release from telethon organizers." (CNN, here)
Another great post from the "Good Intentions are Not Enough" blog, on how the internet makes it easy to set up a sham organization to "raise money" for Haiti.
George Will on the "silver lining" of the Massachusetts election: "a mandate to be moderate." (here)
After 411 speeches, "the president has decided that he needs to start “speaking directly to the American people.”" National Review's Mark Steyn on how nobody is looking forward to Obama speech #412, here.
The Economist on how government is getting too big. "America now has a quarter of a million people devising and implementing federal rules."
The WSJ on Coburn's amendment asking Congress to cut spending instead of raising the debt limit here. I also recently highlighted the amendment.
Interesting post on the Cato Institute's blog says "42 senators in 2008 voted to spend more tax dollars than socialist Bernie Sanders", and that Obama was "one of the 11 senators who voted for more spending than the socialist senator" in 2007.
Keith Hennessy has an excellent post on the difficulties of dividing health insurance reform into smaller bills.
Another great post from the "Good Intentions are Not Enough" blog, on how the internet makes it easy to set up a sham organization to "raise money" for Haiti.
George Will on the "silver lining" of the Massachusetts election: "a mandate to be moderate." (here)
After 411 speeches, "the president has decided that he needs to start “speaking directly to the American people.”" National Review's Mark Steyn on how nobody is looking forward to Obama speech #412, here.
The Economist on how government is getting too big. "America now has a quarter of a million people devising and implementing federal rules."
The WSJ on Coburn's amendment asking Congress to cut spending instead of raising the debt limit here. I also recently highlighted the amendment.
Interesting post on the Cato Institute's blog says "42 senators in 2008 voted to spend more tax dollars than socialist Bernie Sanders", and that Obama was "one of the 11 senators who voted for more spending than the socialist senator" in 2007.
Keith Hennessy has an excellent post on the difficulties of dividing health insurance reform into smaller bills.
Goldman Sachs Campaigns for Obama!
From the Washington Examiner (here):
For his presidential campaign in which Wall Street regulation was a mantra, Obama's top source of funds was investment bank giant Goldman Sachs, whose employees, partners, and executives gave him $995,000 -- that's the most any politician has raised from any one company in a single election since the age of "soft money" ended.
Daily Read - 1/22/10
Krauthammer on the Massachusetts election (here) "The reason both wings of American liberalism -- congressional and mainstream media -- were so surprised at the force of anti-Democratic sentiment is that they'd spent Obama's first year either ignoring or disdaining the clear early signs of resistance: the tea-party movement of the spring and the town-hall meetings of the summer. With characteristic condescension, they contemptuously dismissed the protests as the mere excrescences of a redneck, retrograde, probably racist rabble."
WSJ's Peggy Noonan on political shifts: "In the 2006 and 2008 elections...you came to see the two major parties as the Nuts versus the Creeps. The Nuts were for high spending and taxing and the expansion of government no matter what. The Creeps were hypocrites who talked one thing and did another, who went along on the spending spree while lecturing on fiscal solvency." Voters thought Obama was not a nut based on his campaigning, but then realized he really was one...then Republican candidates in Virginia, New Jersey and Massachusetts "played the part of the Creep very badly!"
The U.S. continues subsidizing bad loans through Fannie Mae and Freddie Mac, but refuse to recognize "tens of billions of dollars" of losses as part of the federal deficit. (WSJ, here) Meanwhile, the President is off vilifying Wall Street.
While bank lending is constrained due to the government's delays in working on new regulations, "More than 40 U.S. homebuilders have teamed up with private equity firms to acquire and complete unfinished subdivisions as banks cut construction lending." "Banks slashed lending to homebuilders because regulators pressured them to reduce real estate assets as defaults on construction loans climbed, said Robert Seiwert, vice president of the American Bankers Association." (Bloomberg, here)
Equity manager Judah Kraushaar in the WSJ on the need for Congress to focus on financial reform, not squeeze it between their other priorities:
Obama slams the Supreme Court decision to allow more political contributions from corporations, 1 1/2 years after breaking a pledge to seek public financing and became "the first major-party presidential nominee to reject the public funds, passing up nearly $85 million in taxpayer money and instead looking to the 1.5 million donors who contributed to his primary campaign". Any way the wind blows...
UFC heavyweight champion Brock Lesnar slams Canadian health care (here). Lesnar recently recovered from a severe digestive disease and said:
WSJ's Peggy Noonan on political shifts: "In the 2006 and 2008 elections...you came to see the two major parties as the Nuts versus the Creeps. The Nuts were for high spending and taxing and the expansion of government no matter what. The Creeps were hypocrites who talked one thing and did another, who went along on the spending spree while lecturing on fiscal solvency." Voters thought Obama was not a nut based on his campaigning, but then realized he really was one...then Republican candidates in Virginia, New Jersey and Massachusetts "played the part of the Creep very badly!"
The U.S. continues subsidizing bad loans through Fannie Mae and Freddie Mac, but refuse to recognize "tens of billions of dollars" of losses as part of the federal deficit. (WSJ, here) Meanwhile, the President is off vilifying Wall Street.
While bank lending is constrained due to the government's delays in working on new regulations, "More than 40 U.S. homebuilders have teamed up with private equity firms to acquire and complete unfinished subdivisions as banks cut construction lending." "Banks slashed lending to homebuilders because regulators pressured them to reduce real estate assets as defaults on construction loans climbed, said Robert Seiwert, vice president of the American Bankers Association." (Bloomberg, here)
Equity manager Judah Kraushaar in the WSJ on the need for Congress to focus on financial reform, not squeeze it between their other priorities:
What we need now is clarity. What will future capital requirements look like? What is the plan to return the banks to reasonable rates of profitability? Until that architecture is put in place, banks will have little incentive to sell the problem assets currently clogging their balance sheets—let alone to lend more aggressively.
Protracted congressional hearings on the bank crisis, piecemeal new regulations, sporadic attacks on bank compensation, and an ad hoc approach to taxing banks will only compound the crisis in the American financial service industry.
Obama slams the Supreme Court decision to allow more political contributions from corporations, 1 1/2 years after breaking a pledge to seek public financing and became "the first major-party presidential nominee to reject the public funds, passing up nearly $85 million in taxpayer money and instead looking to the 1.5 million donors who contributed to his primary campaign". Any way the wind blows...
UFC heavyweight champion Brock Lesnar slams Canadian health care (here). Lesnar recently recovered from a severe digestive disease and said:
Probably the lowest moment was getting care from Canada."
"They couldn't do nothing for me," he noted in a later media conference call Wednesday. "It was like I was in a Third World country."
Common Sense from Senator Coburn
Senator Tom Coburn, M.D. has an editorial in the Washington Examiner today stating the Massachusetts election was "not a referendum on President Obama, health care, or any single issue per se, but on the size and scope of government." The Senate is going to vote soon to raise the limit on U.S. debt by $1.9 Trillion. He is offering an amendment to the bill "to give my colleagues a chance to change their behavior by forcing the Senate to choose between raising the debt limit and cutting spending. The logic of the choice is simple: Millions of families in America have to make hard choices. So should Congress." What a contrast to others who say Americans are hurting in this recession, so the government should pull out all the stops, spend more, and worry about it later.
Some Senators are proposing a commission to investigate how to reduce the federal debt, but Coburn says "we already have a commission to set budget priorities. It’s called the United States Congress. If Congress lacks the political will to set priorities, we don’t need a new commission, we need a new Congress." (emphasis mine) In Coburn's eyes, creating a commission is just another way to duck responsibility.
Daily Read - 1/21/10
Saundra Schimmelpfennig's "Good Intentions are Not Enough" blog has a very good post on The DOs and DON'Ts of Disaster Donations, including:
- Do look for organizations with prior experience and expertise, and
- Do consider holding off some of your donations until later in the rebuilding process
"One of two piers at the port serving the Haitian capital has reopened, and a gravel road was laid off of it, clearing a major route for aid to come into the city, officials said. A Dutch Navy ship, the Pelikaan, unloaded 90 tons of humanitarian aid Thursday morning. Two other ships previously offloaded containers for trucks to carry supplies into Port-au-Prince" (CNN article)
"In a country whose government has all but stopped functioning, in a city whose crowded shanties remain largely unreached by aid cargoes, it has fallen to communities on the ground to fill the gap as best they can. Religious missions, with their deep community connections, are proving to be particularly critical conduits of help, both spiritual and material." (WSJ article)
This Daniel Indiviglio article at The Atlantic discusses "Glaxo-SmithKline's recent decision to put thousands of chemical compounds which may cure malaria into the public domain." An interesting discussion of the balance between responsibility to shareholders and responsibility "for the greater good"
This NY Times article from Sunday talks about "Baumol’s cost disease," which refers to businesses that don't benefit from increased efficiency and therefore labor costs continually rise - such as "the performing arts...education, police work and garbage collection." "Cost disease helps explain why low-income Americans can now afford flat-screen televisions that were out of reach a decade ago, but health insurance that was unaffordable in January 2000 remains unaffordable in January 2010."
"A divided Supreme Court on Thursday swept away decades of legislative efforts to restrict the role of corporations in election campaigns, ruling that severe restrictions on corporate spending are inconsistent with the First Amendment's protection of political speech." (Washington Post) Wonderful - more power for businesses to "vote themselves largesse from the publc treasury"
In this Washington Post article, President Obama said "We were so busy just getting stuff done and dealing with the immediate crises that were in front of us that I think we lost some of that sense of speaking directly to the American people about what their core values are and why we have to make sure those institutions are matching up with those values." Nice spin. 2009 was spent not reforming the financial system, not creating jobs, not reforming health care, not inproving education, and not changing the energy sector. 2009 was not about "getting stuff done" -- it was about sticking to an agenda and finding out that even a supermajority of Democrats in Congress couldn't pass it. Rahm Emanuel didn't want the crisis to "go to waste". To date, not only have they failed in exploiting the crisis for their agenda, but they have also increased the overall uncertainty that is preventing businesses from investing and growing the economy. Obama plans to rectify all of this by telling everyone how angry he is at Wall Street.
Evan Newmark's "Mean Street" blog in the WSJ says "Apparently, this is now how we treat success in America. We damn it — and then we punish it by enacting loopy, politically — expedient measures such as caps on Wall Street trading and principal investments...We need people to come together, but we engage in populist divisiveness. We need millions of jobs, but we kill the incentives and destroy the capital that will create them."
From George Will's column in today's Washington Post:
"We are on the precipice of an achievement that's eluded Congresses and presidents for generations."
-- President Barack Obama, Dec. 15, on health-care legislation
Precipice, 1. a headlong fall or descent, esp. to a great depth.
-- Oxford English Dictionary
"Some are More Equal Than Others" Read responses to the WSJ's article on union member's special exemption from the proposed 40% tax on "Cadillac" health care plans.
Daily Read - 1/20/10
A 6.1 aftershock hits Haiti. "The U.S. Navy ship Comfort is to arrive midmorning Wednesday in the flattened capital. U.S. helicopters will ferry patients aboard, bringing relief to overloaded hospitals and clinics."
Yesterday's election in Massachusetts shows again that Americans prefer divided government over one-party rule:
'It is to me a new and consolatory proof that wherever the people are well-informed they can be trusted with their own government; that whenever things get so far wrong as to attract their notice, they may be relied on to set them to rights."
—Thomas Jefferson to Richard Price, January 8, 1789. (quoted here)
Jay Cost at RCP's HorseRaceBlog ponders Obama's next move. He doesn't "know what Obama will do next. His political biography is so slender that none of us really do...Obama is a mystery, though he has written two autobiographies about himself."
A Washington Post article about FHA "plans to increase the amount of up-front cash paid by all new borrowers and to require higher down payments from those with the poorest credit". It's about time. Ironically, if a private bank that received TARP funds tightened credit like this, Obama would be calling for their heads.
Meanwhile, the government can't get around to letting banks know how much capital they are required to hold: "The U.S. Treasury Department has missed the first deadline in its work to draft tougher capital standards" (Reuters, here) Until the government figures this out, banks will keep holding extra cash, and lending less. Of course, Obama will call for their heads.
The Wall Street Journal's Holman Jenkins on more Washington duplicity (here):
NBC is going to pay Conan O'Brien $40 million to go away. Isn't that taxpayer money going to pay for a mistake made by fat cat CEOs? GE owns NBC, and GE received government bailout money. Where's the compensation czar when you need him?
Megan McArdle at the Atlantic on the cost of health care reform: "anything Obama does to "pay" for this program is something that cannot be done to "pay" for our growing Medicare problem. Slashing provider reimbursements, Medicare advantage, etc, if it is done, is something that should be done in order to close the projected 3.4% budget gap in 2019. Once we've used them for new entitlements, we are less able to pay for the entitlements we've already got." This was posted in September, but worth thinking about today.
The Intergovernmental Panel on Climate Change (IPCC) says to ignore their "poorly substantiated" prediction that Himalayan glaciers would melt by 2035, but "don't think it takes anything away from the overwhelming scientific evidence of what's happening with the climate of this earth."
Yesterday's election in Massachusetts shows again that Americans prefer divided government over one-party rule:
'It is to me a new and consolatory proof that wherever the people are well-informed they can be trusted with their own government; that whenever things get so far wrong as to attract their notice, they may be relied on to set them to rights."
—Thomas Jefferson to Richard Price, January 8, 1789. (quoted here)
Jay Cost at RCP's HorseRaceBlog ponders Obama's next move. He doesn't "know what Obama will do next. His political biography is so slender that none of us really do...Obama is a mystery, though he has written two autobiographies about himself."
A Washington Post article about FHA "plans to increase the amount of up-front cash paid by all new borrowers and to require higher down payments from those with the poorest credit". It's about time. Ironically, if a private bank that received TARP funds tightened credit like this, Obama would be calling for their heads.
Meanwhile, the government can't get around to letting banks know how much capital they are required to hold: "The U.S. Treasury Department has missed the first deadline in its work to draft tougher capital standards" (Reuters, here) Until the government figures this out, banks will keep holding extra cash, and lending less. Of course, Obama will call for their heads.
The Wall Street Journal's Holman Jenkins on more Washington duplicity (here):
Say it isn't so - "President Barack Obama's top goal as he enters a second year in office is to lift U.S. job creation and revitalize the economy, the White House said on Tuesday" (Reuters, here). Can't you just stay out of the way?"Crediting themselves with mending the crisis, President Obama and Treasury Secretary Tim Geithner ruled that banks were on a solid footing because private investors would provide fresh capital and banks would be free to book profits and earn their way out of trouble.
That was then. Today it's politically convenient to bash banks for the very same profits, and to punish the very same investors with a new Obama bank tax. First, the government coaxes banks into buying back the government's TARP stake (and therefore government's share of future earnings). Then it turns around and helps itself to a chunk of those earnings anyway.
NBC is going to pay Conan O'Brien $40 million to go away. Isn't that taxpayer money going to pay for a mistake made by fat cat CEOs? GE owns NBC, and GE received government bailout money. Where's the compensation czar when you need him?
Megan McArdle at the Atlantic on the cost of health care reform: "anything Obama does to "pay" for this program is something that cannot be done to "pay" for our growing Medicare problem. Slashing provider reimbursements, Medicare advantage, etc, if it is done, is something that should be done in order to close the projected 3.4% budget gap in 2019. Once we've used them for new entitlements, we are less able to pay for the entitlements we've already got." This was posted in September, but worth thinking about today.
The Intergovernmental Panel on Climate Change (IPCC) says to ignore their "poorly substantiated" prediction that Himalayan glaciers would melt by 2035, but "don't think it takes anything away from the overwhelming scientific evidence of what's happening with the climate of this earth."
Martha Coakley, Single-Party Rule, and Scary Secularism
Martha Coakley, who is running for a Senate seat in Massachusetts as I write, said in a radio interview that "You can have religious freedom but you shouldn't work in an emergency room." That is, that Catholics should be prevented from working there, because this is a "church and state" issue. Well, most hospital jobs are not government jobs, and forbidding Catholics from working there would be a violation of the liberties of Catholics. Imagine if a right-winger said atheists should be banned from becoming EMTs.
There is already a shortage of health care workers, and Coakley wants to exclude Catholics, which make up 53% of Massachusetts according to exit polls from 2008? Catholic organizations provide a huge portion of the health care in the US. If Coakley loses this election, voters are sending a message that they are tired of single-party rule where politicians can spout partisan ideologies and claim they are right because "they won". I think voters want a reasonable, working government and are tired of the culture wars from both sides.
However, what really scares me is thinking about how Coakley's views could be implemented by government. Suppose the US had universal, government-run health care and Catholics were banned by law from working in emergancy rooms. How would this be enforced? If a hospital hired a Catholic, would they be fined? If they fought the fine, would someone be convicted and thrown in prison?
Here's hoping that voters have learned to ignore Obama's promises of bipartisanship and decide to take their grievances to the ballot box.
There is already a shortage of health care workers, and Coakley wants to exclude Catholics, which make up 53% of Massachusetts according to exit polls from 2008? Catholic organizations provide a huge portion of the health care in the US. If Coakley loses this election, voters are sending a message that they are tired of single-party rule where politicians can spout partisan ideologies and claim they are right because "they won". I think voters want a reasonable, working government and are tired of the culture wars from both sides.
However, what really scares me is thinking about how Coakley's views could be implemented by government. Suppose the US had universal, government-run health care and Catholics were banned by law from working in emergancy rooms. How would this be enforced? If a hospital hired a Catholic, would they be fined? If they fought the fine, would someone be convicted and thrown in prison?
Here's hoping that voters have learned to ignore Obama's promises of bipartisanship and decide to take their grievances to the ballot box.
Update on the Homebuyer Tax Credit
Because of the rampant scamming of the system, Congress changed the rules when they extended and expanded the homebuyer tax credit. Now, according to this CNNMoney article, "buyers must now file documentation with their taxes -- including proof of residency, a signed mortgage statement and drivers license -- which the e-file system is not equipped to handle."
However, now taxpayers claiming the credit cannot e-file, and they can expect delays of a few months before receiving the credit. Seems like a reasonable request for the government to actually require documentation, and a reasonable burden for a taxpayer to bear in order to get $8,000.
Most Under-reported Story of the Recession?
CNBC reports "Many Firms Reluctant to Hire Because of New Taxes, Rules".
According to this article:
If only the government would take advice from the medical profession: "first, do no harm." Instead, they seem to be complicit in keeping this crisis alive longer than necessary to make sure they don't "waste" it.
According to this article:
The prospect of increased federal and state regulation and taxes has been particularly disruptive to the hiring plans of small- and medium-sized businesses, which have historically generated about two-thirds of the nation’s jobs...Businesses don't like to hire in an uncertain environment, and while Congress has spent much of 2009 and early 2010 debating health care "reform", employers have little guidance on taxes, energy policy, financial sector reform, and other areas Obama promises to address. Meanwhile, the administration claims they're doing everything they can to create jobs.
In a recent interview with CNBC.com, the [American Chamber of Commerce]’s chief economist, Martin Regalia, described a paralyzing uncertainty over policy issues, saying that many members “had adopted an attitude of survival” and "few talked about net new hiring.”
If only the government would take advice from the medical profession: "first, do no harm." Instead, they seem to be complicit in keeping this crisis alive longer than necessary to make sure they don't "waste" it.
Shameful Behavior at H&M's New York Store
This appalling story comes from the NY Times: "A Clothing Clearance Where More Than Just the Prices Have Been Slashed." They report this scene from the HM clothing store on 34th Street:
At any time, but particularly during this recession, H & M and Wal-Mart should be ashamed of themselves. "Directly around the corner from H & M is a big collection point for New York Cares, which conducts an annual coat drive."
At the back entrance on 35th Street, awaiting trash haulers, were bags of garments that appear to have never been worn. And to make sure that they never would be worn or sold, someone had slashed most of them with box cutters or razors, a familiar sight outside H & M’s back door.Similar clothes were also found at a nearby Wal-Mart, but a spokesman says "the company normally donates all its unworn goods to charities."
At any time, but particularly during this recession, H & M and Wal-Mart should be ashamed of themselves. "Directly around the corner from H & M is a big collection point for New York Cares, which conducts an annual coat drive."
Dave Barry's Hilarious Review of 2009
The Washington Post published "Lowlights of a Downer Year: Dave Barry on the money, madness and misery of 2009", a hilarious review of the year's events.
Some of my personal favorites:
Some of my personal favorites:
It was also a year of Change, especially in Washington, where the tired old hacks of yesteryear finally yielded the reins of power to a group of fresh, young, idealistic, new-idea outsiders such as Nancy Pelosi. As a result, Washington, rejecting "business as usual," finally stopped trying to solve every problem by throwing billions of taxpayer dollars at it, and instead started trying to solve every problem by throwing trillions of taxpayer dollars at it.
Congress passes, without reading it and without actually finishing writing it, a stimulus package totaling $787 billion...This will stimulate the economy by creating millions of jobs, according to estimates provided by the Congressional Estimating Office's Magical Estimating 8-Ball.
The annual observance of Earth Hour is observed with one hour of symbolic energy conservation as hundreds of millions of nonessential lights and appliances are turned off. And that's just in Al Gore's house.
In other international bad news, North Korea launches a test missile that experts say is capable of hitting Hawaii, based on the fact that it actually hits Hawaii. The United States swiftly pledges to issue a strongly worded condemnation containing "even stronger words than last time."
New York is temporarily thrown into a panic when Air Force One flies low over Manhattan for a publicity photo shoot. Responding to widespread criticism, Gibbs notes that Obama inherited Air Force One from the Bush administration.
On Obama's Fatigue
The Wall Street Journal's 'Best of the Web Today' blog has this amusing bit about Obama's recent admission of feeling tired:
If Obama's tired, maybe it's because he keeps promising not to rest:
"Obama 'Will Not Rest' Until Healthcare Reformed"--headline, Agence France-Presse, May 11
"Obama: 'I Will Not Rest' Until Businesses Are Hiring"--headline, RealClearPolitics.com, Nov. 23
"Obama Says 'We Will Not Rest' Until Plotters Found"--headline, Bloomberg.com, Dec. 28
Obama was on vacation in Hawaii at the time the AP reported he was tired.
