October has come to an end, and the traffic to this site has again risen to a new record. In fact, visits were up by more than 10% over last month which had been the previous recod month. Thanks to everyone for your support.
Sunday, October 31, 2010
Talking Points Don't Make Up For Lack of an Acceptable Program
Does anyone else remember all those Democrat "strategists" and "pundits" who appeared on the news from the Spring of this year through September? You know, the ones who said that the Democrats would be able to avoid losses like they had in 1994, because this time the Democrats would not be surprised. No, they said, the Democrats were aware of the probems that they faced and would be able to stop any large losses from happening by prompt action.
Well now we are two days away from what looks like the biggest losses suffered by the Democrats in the House in at least 62 years and perhaps the largest since 1894 (116 years ago). Just imagine how bad thing would be if the Democrats had not had that early warning.
The truth is that the Democrats earned this drubbing. They thumbed their noses at the American people. they did what they wanted despite the loud voices of opposition to their programs. The Democrats ignored the economy and focuses instead on proposals that would actually kill jobs rather than create them. I guess the Democrats think that the American people are just idiots who would not notice what was happening. Fortunately for the country, the Democrats were wrong.
Well now we are two days away from what looks like the biggest losses suffered by the Democrats in the House in at least 62 years and perhaps the largest since 1894 (116 years ago). Just imagine how bad thing would be if the Democrats had not had that early warning.
The truth is that the Democrats earned this drubbing. They thumbed their noses at the American people. they did what they wanted despite the loud voices of opposition to their programs. The Democrats ignored the economy and focuses instead on proposals that would actually kill jobs rather than create them. I guess the Democrats think that the American people are just idiots who would not notice what was happening. Fortunately for the country, the Democrats were wrong.
Voting in Connecticut -- Who we Recommend
Tuesday's election is upon us and it is important to remember the candidates who deserve to be elected.
First of all, in the race for governor, Republican Tom Foley is the clear choice over Democrat Dan Malloy. Foley has promised to cut spending and hold the line on taxes. Malloy makes similar noises, but he will not pledge to avoid raising taxes and, more important, we can look at his record as mayor of Stamford to see how he would govern. As mayor, Malloy raised taxes repeatedly, increased spending faster than the rate of inflation and presided over a local economy that lost over 13,000 jobs while he was mayor. This is important to remember because in each race for mayor, Malloy said he would hold the line on spending and taxes. Malloy makes ahabit of saying on thing about spending and taxes and then doing the opposite. Malloy has also promised the state employee unions that he wouldtake no actions that could lead to a reduction in state labor costs, virtually insuring that a tax increase will be necessary to pay for the increased salaries and benefits of the state work force (which is already far above the pay and benefits available in private industry). Malloy is a danger to the state and Foley has presented a clear and acceptable plan to cut spending and keep from raising taxes.
The choice is clear: Vote for Foley!
Second, in the race for Senator we endorse Linda McMahon. Washington needs another senator who has experience in the business world, someone like Linda who knows how to create jobs and help small businesses (where nearly all of the new jobs come from). Richard Blumenthal is a career politician who seems to have trouble telling the difference between the truth and a lie (like his military record). More important, Blumenthal just does not understand how the economy functions, so he is unlikely to do the right thing when it comes to helping set conditions so that the economy can start creating jobs again.
The choice in this race is also clear: Vote for McMahon.
In the Congressional race in District 4, the race is between Democrat Jim Himes and Republican Dan Debicella. Himes has been a rubber stamp for the liberal Obama/Pelosi agenda in Washington. Now, he is claiming to be indepedent. Himes, however, lies not just about being independent, but also about his views on a number of other issues. I wrote just yesterday about the latest lies coming from the Himes campaign regarding Himes' views on Israel. Himes has also used nearly his entire campagin budget to try to spread falsehoods about Debicella. Fortunately, Himes' campaign of rumor and innuendo seems not to have worked.
Debicella seems like a good man with strong views about cutting spending, holding the line on taxes and otherwise promoting growth in the economy.
The choice here is clear as well: Himes is so dishonest that the only resonable and honorable choice is to vote for Debicella.
In the races for the legislature, there are interesting candidates from both parties. The problem for the state, however, is that the super majority held by the Democrats in both houses of the Legislature make it impossible for a Republican governor like Tom Foley to keep control of spending and taxes. Thus, I strongly recommend a vote for the Republican ticket in the legislature. If even a small number of seats flip from the Democrats to the Republicans, it will give Foley a fighting chance to carry out his programs. If we are ever to get control of spending in this state, we need to give the Republicans more seats in the legislature.
First of all, in the race for governor, Republican Tom Foley is the clear choice over Democrat Dan Malloy. Foley has promised to cut spending and hold the line on taxes. Malloy makes similar noises, but he will not pledge to avoid raising taxes and, more important, we can look at his record as mayor of Stamford to see how he would govern. As mayor, Malloy raised taxes repeatedly, increased spending faster than the rate of inflation and presided over a local economy that lost over 13,000 jobs while he was mayor. This is important to remember because in each race for mayor, Malloy said he would hold the line on spending and taxes. Malloy makes ahabit of saying on thing about spending and taxes and then doing the opposite. Malloy has also promised the state employee unions that he wouldtake no actions that could lead to a reduction in state labor costs, virtually insuring that a tax increase will be necessary to pay for the increased salaries and benefits of the state work force (which is already far above the pay and benefits available in private industry). Malloy is a danger to the state and Foley has presented a clear and acceptable plan to cut spending and keep from raising taxes.
The choice is clear: Vote for Foley!
Second, in the race for Senator we endorse Linda McMahon. Washington needs another senator who has experience in the business world, someone like Linda who knows how to create jobs and help small businesses (where nearly all of the new jobs come from). Richard Blumenthal is a career politician who seems to have trouble telling the difference between the truth and a lie (like his military record). More important, Blumenthal just does not understand how the economy functions, so he is unlikely to do the right thing when it comes to helping set conditions so that the economy can start creating jobs again.
The choice in this race is also clear: Vote for McMahon.
In the Congressional race in District 4, the race is between Democrat Jim Himes and Republican Dan Debicella. Himes has been a rubber stamp for the liberal Obama/Pelosi agenda in Washington. Now, he is claiming to be indepedent. Himes, however, lies not just about being independent, but also about his views on a number of other issues. I wrote just yesterday about the latest lies coming from the Himes campaign regarding Himes' views on Israel. Himes has also used nearly his entire campagin budget to try to spread falsehoods about Debicella. Fortunately, Himes' campaign of rumor and innuendo seems not to have worked.
Debicella seems like a good man with strong views about cutting spending, holding the line on taxes and otherwise promoting growth in the economy.
The choice here is clear as well: Himes is so dishonest that the only resonable and honorable choice is to vote for Debicella.
In the races for the legislature, there are interesting candidates from both parties. The problem for the state, however, is that the super majority held by the Democrats in both houses of the Legislature make it impossible for a Republican governor like Tom Foley to keep control of spending and taxes. Thus, I strongly recommend a vote for the Republican ticket in the legislature. If even a small number of seats flip from the Democrats to the Republicans, it will give Foley a fighting chance to carry out his programs. If we are ever to get control of spending in this state, we need to give the Republicans more seats in the legislature.
AP back at work helping the Democrats
This morning, the Associated Press put out an article that was headlined as "Early voting confirms a tight race in Nevada --
Democrats appear to have blunted the surge of GOP enthusiasm in the Nevada Senate race" I was interested to see what had happened in the Nevada race, so I read the article -- three times! When I first read the article, I was puzzled since there was no mention of early voting or even and push by the Democrats in that regard. I read it again and again just to make sure that I had not missed something -- I had not, the article was silent on the subject in the headline. As a result, I did a quick check of the Las Vega Review Journal to see what the early voting stats were and found this: 379,589 people had voted by the end of the early voting. Democrats comprised 42.9% of the early voters and they are about 42.5% of the registered voters. Republicans comprised 41.1% of the early voters but are only 36.7% of the registered voters. The rest were nonpartisan or third party voters who were 16% of the early voting but are 21.3 percent of the registered voters. This means that the GOP turned out a substantially higher percentage of its voters for the early voting than the Democrats did.
Simply put, the AP headline was not only unrelated to the story, it was also factually incorrect. There was a marked enthusiasm gap that left GOP voters approximately 10% more likely to vote than Democrats.
It will be interesting to see the results from Nevada. My guess is that on Wednesday we will see a headline from the AP that reads something like this: "Angle outpolls Reid, but Reid still wins" I doubt that the AP will ever return to reality.
Democrats appear to have blunted the surge of GOP enthusiasm in the Nevada Senate race" I was interested to see what had happened in the Nevada race, so I read the article -- three times! When I first read the article, I was puzzled since there was no mention of early voting or even and push by the Democrats in that regard. I read it again and again just to make sure that I had not missed something -- I had not, the article was silent on the subject in the headline. As a result, I did a quick check of the Las Vega Review Journal to see what the early voting stats were and found this: 379,589 people had voted by the end of the early voting. Democrats comprised 42.9% of the early voters and they are about 42.5% of the registered voters. Republicans comprised 41.1% of the early voters but are only 36.7% of the registered voters. The rest were nonpartisan or third party voters who were 16% of the early voting but are 21.3 percent of the registered voters. This means that the GOP turned out a substantially higher percentage of its voters for the early voting than the Democrats did.
Simply put, the AP headline was not only unrelated to the story, it was also factually incorrect. There was a marked enthusiasm gap that left GOP voters approximately 10% more likely to vote than Democrats.
It will be interesting to see the results from Nevada. My guess is that on Wednesday we will see a headline from the AP that reads something like this: "Angle outpolls Reid, but Reid still wins" I doubt that the AP will ever return to reality.
A Plan for the Next two years -- 4
How should the Republicans handle the issue of entitlements over the next two years (assuming that the GOP controls the House and that the Senate is close to a tie after the election)?
First, the worst thing that the GOP can do is to do nothing. Even if no bills get passed and signed by Obama, just doing nothing is not acceptable. The new congressmen and senators were not sent to Washington to hide from the big problems.
On Medicare, the issue of what to do is not difficult. First, the GOP should push for the finding and removal of waste and fraud in the system. After all, Obama told us that Obamacare would be paid for by cutting half a trillion dollars of waste and fraud from medicare. Obama and the Obamacrats will be hard pressed to argue against enforcement plans to get rid of the waste and fraud. And we all know that there is an extraordinary level of waste and fraud in this program, so cutting it will help every American (other than those who are stealing public funds through the fraud.) Second, the GOP should engage in programs that will educate the public to the other problems in the system. What if the House were to hold hearings on possible changes to the reimbursement methods used in medicare. Why should the doctors be paid per procedure as opposed to some other form of payment. Payment per treatment incentivizes the furnishing of additional and unnecessary treatments to patients who may not realize that the treatments are superfluous. Even Obama might sign on to a program to explore alternatives to the current payment methods. The scope of coverage should also be examined. If the American people see that the GOP is doing a careful and complete review of the program, it will be less likely to buy into the meme that the GOP is destroying Medicare. Indeed, at the same time the GOP has to keep explaining that Medicare is going broke and has to be fixed.
On Social Security, the GOP should try to make a deal with Obama. There needs to be a change to the retirement age. That age was set at 65 back in the mid 1930's when the program was passed. Since then, it has been moved back by two years at the most even though the length of the average life for an American worker has increased by much more than that. The program needs to be repaired or it will go broke, so doing nothing is not a possibility for any responsible group. Just changing the retirement age to 69 would save the program for decades -- and that assumes that those close to retirement age and already in the program remain unaffected. There can also be a phased in increase in the payroll tax, although this should be minimal since it will be necessary to avoid damaging the economy right now.
Another entitlement that has to be addressed is unemployment compensation. Right now the feds are paying to keep people on unemployment for two and a half years. While no one wants to put people under, the constant extensions have to end. Those who cannot afford their living expenses can then go one welfare if needed. Those who are getting unemployment but who could find another job need to be forced to do just that. There are a myriad of studies that show that a large percentage of those on unemployment find work when their benefits have less than two weeks to go. Let's force this to happen sooner.
Medicaid is the last of the big programs that has to be addressed. This is supposedly a state program, but it is pushed by federal rules and regulations into one of the biggest state expenses in nearly every state. Even so, There are major variations on a state by state basis. for example, spending per person in New York is more than double that in other states, but the standard of care received in NY is no better than elsewhere. States should be encouraged to reduce their costs through efficiency and cutting waste and fraud. This could be done by making sure that all funding to states for Medicaid programs are made as lump sums. The federal government should never pay a percentage of state expenditures. If New York wants to waste enormous sums on medicare, let it waste the money of the people in that state and not get subsidized by the rest of the country. Such a move would force the program to be streamlined in the states with extravagant programs.
First, the worst thing that the GOP can do is to do nothing. Even if no bills get passed and signed by Obama, just doing nothing is not acceptable. The new congressmen and senators were not sent to Washington to hide from the big problems.
On Medicare, the issue of what to do is not difficult. First, the GOP should push for the finding and removal of waste and fraud in the system. After all, Obama told us that Obamacare would be paid for by cutting half a trillion dollars of waste and fraud from medicare. Obama and the Obamacrats will be hard pressed to argue against enforcement plans to get rid of the waste and fraud. And we all know that there is an extraordinary level of waste and fraud in this program, so cutting it will help every American (other than those who are stealing public funds through the fraud.) Second, the GOP should engage in programs that will educate the public to the other problems in the system. What if the House were to hold hearings on possible changes to the reimbursement methods used in medicare. Why should the doctors be paid per procedure as opposed to some other form of payment. Payment per treatment incentivizes the furnishing of additional and unnecessary treatments to patients who may not realize that the treatments are superfluous. Even Obama might sign on to a program to explore alternatives to the current payment methods. The scope of coverage should also be examined. If the American people see that the GOP is doing a careful and complete review of the program, it will be less likely to buy into the meme that the GOP is destroying Medicare. Indeed, at the same time the GOP has to keep explaining that Medicare is going broke and has to be fixed.
On Social Security, the GOP should try to make a deal with Obama. There needs to be a change to the retirement age. That age was set at 65 back in the mid 1930's when the program was passed. Since then, it has been moved back by two years at the most even though the length of the average life for an American worker has increased by much more than that. The program needs to be repaired or it will go broke, so doing nothing is not a possibility for any responsible group. Just changing the retirement age to 69 would save the program for decades -- and that assumes that those close to retirement age and already in the program remain unaffected. There can also be a phased in increase in the payroll tax, although this should be minimal since it will be necessary to avoid damaging the economy right now.
Another entitlement that has to be addressed is unemployment compensation. Right now the feds are paying to keep people on unemployment for two and a half years. While no one wants to put people under, the constant extensions have to end. Those who cannot afford their living expenses can then go one welfare if needed. Those who are getting unemployment but who could find another job need to be forced to do just that. There are a myriad of studies that show that a large percentage of those on unemployment find work when their benefits have less than two weeks to go. Let's force this to happen sooner.
Medicaid is the last of the big programs that has to be addressed. This is supposedly a state program, but it is pushed by federal rules and regulations into one of the biggest state expenses in nearly every state. Even so, There are major variations on a state by state basis. for example, spending per person in New York is more than double that in other states, but the standard of care received in NY is no better than elsewhere. States should be encouraged to reduce their costs through efficiency and cutting waste and fraud. This could be done by making sure that all funding to states for Medicaid programs are made as lump sums. The federal government should never pay a percentage of state expenditures. If New York wants to waste enormous sums on medicare, let it waste the money of the people in that state and not get subsidized by the rest of the country. Such a move would force the program to be streamlined in the states with extravagant programs.
Saturday, October 30, 2010
Obama is a disgrace
This afternoon in Bridgeport Connecticut, Obama's appearance at a campaign rally was disrupted by leftwing protesters who chanted that Obama was not doing enough to fight the global spread of AIDS. To put it mildly, this protest was moronic since the US already funds the lions share of all AIDS treatment in Africa. Indeed, one of the signature programs during the bush Administration was an increase in funding to fight AIDS worldwide of over 500% from the amount spent during the Clinton years. Treatment in much of Africa was made possible by this US program. The program has continued unchanged since Obama took office. The protestors are just idiots who are not informed of the truth.
The problem that I have, however, is not with the protestors. They are just fools. My problem is with Obama who took the opportunity of the disruption to tell the crowd that the protestors should go to Republican rallies since those are the folks who do not want to fund AIDS treatments around the world. What a disgraceful and blatant lie! The entire program to fund AIDS treatment came from the Bush Administration and it was funded by a Republican Congress. I am not suggesting that Democrats opposed the program; they did not. But for Obama to not only claim credit for the current program but to knowingly falsely claim that Republicans were somwhow opposed to their own program was a true disgrace. The President of the United States should not be a blatant liar. It is too bad that we have to suffer another two years of this man. Obama has got to go!
The problem that I have, however, is not with the protestors. They are just fools. My problem is with Obama who took the opportunity of the disruption to tell the crowd that the protestors should go to Republican rallies since those are the folks who do not want to fund AIDS treatments around the world. What a disgraceful and blatant lie! The entire program to fund AIDS treatment came from the Bush Administration and it was funded by a Republican Congress. I am not suggesting that Democrats opposed the program; they did not. But for Obama to not only claim credit for the current program but to knowingly falsely claim that Republicans were somwhow opposed to their own program was a true disgrace. The President of the United States should not be a blatant liar. It is too bad that we have to suffer another two years of this man. Obama has got to go!
Stock of the Month for November -- Range Resources Corporation (RRC)
My pick for stock of the month for November is Range Resources corporation (Symbol RRC). Range Resources is an independent natural gas exploration and development company that has properties in the southwest and in the Appalachian areas. Its current production comes from many different sources, but the reason to buy the stock is its large position in the Marcellus shale which lies under mostly Pennsylvania, New York, and West Virgina. RRC is one of the largest operators in the Marcellus and it has enormous up side potential as a result. In fact, because RRC has large positions in the southwestern part of Pennsylvania, an area where the marcellus has a high amount of natural gas liquids, it is even better placed to do well in that play.
If, as I assume, the Republicans take congress and the Pennsylvania legislature and governorship on Tuesday, much of the threat of new regulations that will thwart the development of the Marcellus Shale will be erased. If elected governor of Pennsylvania, the Republican Corbett has already made clear that he want to see gas drilling in that state proceed quickly. The bogus environmentalist threats to drilling will be removed from the state political scene for at least four years. Indeed, the only threat left will come from regulatory action by the EPA, and while that threat cannot be ruled out, it is not likely in my opinion.
If RRC is able to drill without political limitation in the Pennsylvania region of the Marcellus, it will be able to ramp up its production quickly. This will not necessarily mean high short term profits, since the price of nat gas is very low at the moment. In fact, it is at a sustained low when compared to the price of oil. But that very price differential should push an increase in consumption of the fuel over time with the result that natural gas prices should stabilize or even rise a bit. In the longer term, market forces will surely drive higher usage of nat gas and a reduction of oil based energy.
It is the longer term prospects of natural gas that makes RRC so attractive. Once the political risks are taken out of the Marcellus, it is likely that more of the major oil companies will seek entry into that major play. That makes RRC a very attractive target for acquisition. Over the next 18 months, we are likely to see a move by the majors and RRC could be among the first companies gobbled up.
In summary, RRC is not a short term investment. Its price will be volatile, although you can use its options to lessen the fluctuations. The predominant market forces, however, will give this stock a strong push up so long as the US economy does not revert to recession. If you invest, it is important to keep at least a significant portion of your position free from limitations like covered calls, since a big part of the attraction here is the prospect of a take over at a big premium to the current price.
Disclosure: I am long RRC. It is the single biggest energy holding in the accounts I manage.
If, as I assume, the Republicans take congress and the Pennsylvania legislature and governorship on Tuesday, much of the threat of new regulations that will thwart the development of the Marcellus Shale will be erased. If elected governor of Pennsylvania, the Republican Corbett has already made clear that he want to see gas drilling in that state proceed quickly. The bogus environmentalist threats to drilling will be removed from the state political scene for at least four years. Indeed, the only threat left will come from regulatory action by the EPA, and while that threat cannot be ruled out, it is not likely in my opinion.
If RRC is able to drill without political limitation in the Pennsylvania region of the Marcellus, it will be able to ramp up its production quickly. This will not necessarily mean high short term profits, since the price of nat gas is very low at the moment. In fact, it is at a sustained low when compared to the price of oil. But that very price differential should push an increase in consumption of the fuel over time with the result that natural gas prices should stabilize or even rise a bit. In the longer term, market forces will surely drive higher usage of nat gas and a reduction of oil based energy.
It is the longer term prospects of natural gas that makes RRC so attractive. Once the political risks are taken out of the Marcellus, it is likely that more of the major oil companies will seek entry into that major play. That makes RRC a very attractive target for acquisition. Over the next 18 months, we are likely to see a move by the majors and RRC could be among the first companies gobbled up.
In summary, RRC is not a short term investment. Its price will be volatile, although you can use its options to lessen the fluctuations. The predominant market forces, however, will give this stock a strong push up so long as the US economy does not revert to recession. If you invest, it is important to keep at least a significant portion of your position free from limitations like covered calls, since a big part of the attraction here is the prospect of a take over at a big premium to the current price.
Disclosure: I am long RRC. It is the single biggest energy holding in the accounts I manage.
Jon Stewart's Rally
I have not paid much attention to today's big comedy rally "to restore sanity" in Washington. Yet, this morning I read a take on it that is worth repeating. The discussion was a report on the NewsBusters site discussing the objections of Bill Press to the rally. Press is a liberal radio personality. He was upset with Stewart for holding such a rally on the weekend before the election. Press correctly pointed out that many of the people going to the rally would be home campaigning for Democrats but for the rally. Stewart seems to be hurting the campaigns of those he favors most.
I think Press is correct. Nice work Stewart; keep it up.
I think Press is correct. Nice work Stewart; keep it up.
It Just Keeps Getting Worse for the Democrats -- the coming Avalanche
I have been updating the numbers coming out from Real Clear Politics regarding the House races on a regular basis. In the last few days, there have been a large number of polls that have shifted the numbers once again. Accordint to RCP, Democrats have 171 seats that at least lean towards them and Republicans have 224 such seats leaving 40 toss up seats. 171 seats is the lowest the Democrats have gotten all year. Five weeks ago, they had 30 more, but their weaknesses keep appearing. If the Republicans win only half of the toss up seats, they will have a gain of 65 seats net. That truly understates the GOP strength, however. With the trends of recent weeks and with the enthusiasm gap between the parties, the more likely outcome is for the GOP to pick up three quarters of the toss ups and about a third of the seats that RCP lists as leaning to the Democrats. That gives the GOP a total of 263, a gain of 84 seats.
In the last week, whole states have shifted. For example, in Maine the governors race has moved solidly towards the GOP and every congressional seat has also shifted towards the GOP. there are still many seats with no public polls available. I have to wonder how many of these seats will turn out to flip to the GOP as well.
I have been calling this an avalanche. I think I need a word thata means something bigger.
In the last week, whole states have shifted. For example, in Maine the governors race has moved solidly towards the GOP and every congressional seat has also shifted towards the GOP. there are still many seats with no public polls available. I have to wonder how many of these seats will turn out to flip to the GOP as well.
I have been calling this an avalanche. I think I need a word thata means something bigger.
Friday, October 29, 2010
Himes-Debicella -- UPDATE
Earlier today I wrote about the last minute desperate lies coming from Jim Himes in the 4th congressional district of Connecticut. Tonight there is a poll out that explains some of that desperation. The poll from CT Capitol Report/MRG has Debicella at 48% and Himes at 46%. This is the first poll of the election year that puts Himes behind his challenger. Each of the earlier polls had Himes ahead, but the margin kept getting smaller and smaller. So now Debicella has moved ahead and Himes' upset at the situation is understandable. It is too bad, however, that Himes feels that he has to lie to try to regain the lead. Himes' big mistake was not running a positive campaign where he gave voters a reason to select him. Instead, his whole campaign has been one smear after another directed at Debicella. Once Debicella was able to show the district that he is not the bogeyman that Himes claims him to be, Himes whole campaign fell apart.
Let's just hope that Himes' last minute lies are unsuccessful.
Let's just hope that Himes' last minute lies are unsuccessful.
Last Minute lies from Jim Himes
Today's mail brings a surprising mailing from congressman Jim Himes, the Democrat in the fourth district of Connecticut who is seeking re-election in a close race against Republican Dan Debicella. Most of Himes' campaign has consisted of spreading lies about Debicella. For example, as a state senator Debicella voted against a bill that required Catholic hospitals to provide abortion services in certain instances. Himes' campaign materials call that Cebicella's vote against allowing abortions for women who have been raped. Himes' description of the substance of the vote has essentially no relationship to reality. Today, however, the subject was Himes' record on US relations with Israel.
Himes has not been very supportive of Israel in its fight against Arab terrorism. He is one of the so-called Gaza - 54, fifty four members of Congress who signed a letter stating that Israel was violating humanitarian principles in enforcing the blockade against Hamas in the Gaza Strip. That blockade allows food and humanitarian supplies into Gaza but blocks the entry of weapons and materials that could be used for military purposes. Hamas has done its best to portray the people in Gaza as suffering deprivation at the hands of the Israelis, and Himes has gone along with that. Indeed, even after the recent opening in Gaza of a new luxury mall, Himes still stands by his letter that the Israelis are depriving the people of Gaza of basic human necessities. It is simply not true, but Jim Himes either doesn't know or doesn't care.
Debicella has sent out campaign literature that makes clear his support for Israel and highlights Himes poor record in that regard. Debicella points out also the endorsement by Himes of J-Street, the George Soros funded anti-Israel political action committee that masquerades as a "friend" of Israel.
Himes' mailing now claims that Debicella is falsely attacking Himes' record. Himes' claims that he is a friend of Israel because he has visited Israel more than once. The mailer even has pictures to prove that he has been there.
The problem for Himes is that as recently as October 21, 2010, he repeated in a debate his support for the letter condemning the Gaza weapons blockade as violating humanitarian principles. If Jim Himes cannot tell the difference between the truth and a lie put forward by Hamas, he cannot be a friend of Israel. On the other hand, if Himes is aware of the truth about the blockade, then he is just taking a dishonest position in order to satisfy some of his far left supporters, and he is not a friend of Israel. Either way, Debicella is right.
From the day he took office, Himes has done one thing and said another. We hear from him repeatedly that he is independent, but he voted consistently to pass the Obama agenda. The truth is that Himes is just plain dishonest and does not deserve to be re-elected. Those who care about the integrity of their congressman and those who care about the future of the country should vote for Debicella.
Himes has not been very supportive of Israel in its fight against Arab terrorism. He is one of the so-called Gaza - 54, fifty four members of Congress who signed a letter stating that Israel was violating humanitarian principles in enforcing the blockade against Hamas in the Gaza Strip. That blockade allows food and humanitarian supplies into Gaza but blocks the entry of weapons and materials that could be used for military purposes. Hamas has done its best to portray the people in Gaza as suffering deprivation at the hands of the Israelis, and Himes has gone along with that. Indeed, even after the recent opening in Gaza of a new luxury mall, Himes still stands by his letter that the Israelis are depriving the people of Gaza of basic human necessities. It is simply not true, but Jim Himes either doesn't know or doesn't care.
Debicella has sent out campaign literature that makes clear his support for Israel and highlights Himes poor record in that regard. Debicella points out also the endorsement by Himes of J-Street, the George Soros funded anti-Israel political action committee that masquerades as a "friend" of Israel.
Himes' mailing now claims that Debicella is falsely attacking Himes' record. Himes' claims that he is a friend of Israel because he has visited Israel more than once. The mailer even has pictures to prove that he has been there.
The problem for Himes is that as recently as October 21, 2010, he repeated in a debate his support for the letter condemning the Gaza weapons blockade as violating humanitarian principles. If Jim Himes cannot tell the difference between the truth and a lie put forward by Hamas, he cannot be a friend of Israel. On the other hand, if Himes is aware of the truth about the blockade, then he is just taking a dishonest position in order to satisfy some of his far left supporters, and he is not a friend of Israel. Either way, Debicella is right.
From the day he took office, Himes has done one thing and said another. We hear from him repeatedly that he is independent, but he voted consistently to pass the Obama agenda. The truth is that Himes is just plain dishonest and does not deserve to be re-elected. Those who care about the integrity of their congressman and those who care about the future of the country should vote for Debicella.
Obama's closing argument
I keep waiting for President Obama to tell one of his college rallies: "If you like the Congressman that you have, you can keep him!"
My guess is that were Obama to say this, it would be about as accurate as when Obama said the same thing about health insurance plans. since he had no problem lying about it with regard to health plans, I see no reason why he should refrain from doing it with regard to the election.
My guess is that were Obama to say this, it would be about as accurate as when Obama said the same thing about health insurance plans. since he had no problem lying about it with regard to health plans, I see no reason why he should refrain from doing it with regard to the election.
I knew that I did not like him
Pat Buchanan is out this morning with his pre-election analysis of the results. His take on the expected Republican victory: "Tuesday, obstructionism reaps its reward."
What a crock. I think he has been on MSNBC too long. Maybe he has been leaning forward and finally fallen over. To call the election a victory for obstructionism misses the main feature of this entire election cycle. The Democrats are reaping what they sowed. The Democrats ignored the will of the people to pass Obamacare. The Democrats spent the last year and a half falsely denigrating the Tea Party folks and their allies with nasty accusations of racism and (to use John Kerry's latest words) "know nothingism". The Democrats spent a trillion dollars on a stimulus that they knew or certainly should have known would not stimulate the economy. The Democrats pushed bills like cap and trade that would have forced another recession. The Democrats spent and spent and spent. The Republicans were unable to obstruct this wave of leftist politics because the Democrats had total control in both houses of Congress.
The truth is that the Democrats are receiving their just reward for their execrable behavior. The result is not due to obstructionism by Republicans, it is due to unpopular and inappropriate activism by the Democrats.
What a crock. I think he has been on MSNBC too long. Maybe he has been leaning forward and finally fallen over. To call the election a victory for obstructionism misses the main feature of this entire election cycle. The Democrats are reaping what they sowed. The Democrats ignored the will of the people to pass Obamacare. The Democrats spent the last year and a half falsely denigrating the Tea Party folks and their allies with nasty accusations of racism and (to use John Kerry's latest words) "know nothingism". The Democrats spent a trillion dollars on a stimulus that they knew or certainly should have known would not stimulate the economy. The Democrats pushed bills like cap and trade that would have forced another recession. The Democrats spent and spent and spent. The Republicans were unable to obstruct this wave of leftist politics because the Democrats had total control in both houses of Congress.
The truth is that the Democrats are receiving their just reward for their execrable behavior. The result is not due to obstructionism by Republicans, it is due to unpopular and inappropriate activism by the Democrats.
Thursday, October 28, 2010
Who is talking here?
I just read an article from MSNBC explaining how europeans are dismayed that Obama's party may take a hit on Tuesday. In fact, the article actually say this: "Many Europeans don't get it. 'They're very confused as to how [Americans] could vote for Obama and then two years later turn around and vote for a completely different set of policies,' Sarah Oates, professor of political communication the University of Glasgow, told msnbc.com."
So a professor in the UK does not understand how voters could vote for one party and, after two years of bad experience, change their minds and vote for the opposition. Maybe the professor is also confused why people breathe out after they breathe in. Even for the Obama apologists at MSNBC this article is lame. Are Americans actually supposed to believe that europeans are confused? Are americans actually supposed to care what the europeans think about our politics? Indeed, are Americans to believe that europeans actually follow our politics in any degree of detail?
The truth is that there are certainly some Europeans who follow american politics, just as there are some in the USA who understand that the current UK government is a coalition between the Conservatives and the Liberal parties. I doubt, however, if there are too many Americans who would have the audacity to lament the fact that UK voters changed their mind in the last election and voted out Gordon Brown and the Labour party. We would respect the decision of the Brits and simply try to move forward with the new government of the UK. Indeed, I suspect that aside from the fools that spoke to MSNBC, that is exactly how most Brits feel about the current US election.
I do wonder why MSNBC puts this garbage out there. Is it to make their leftist audience feel better about the impending electoral debacle? Is it to let their audience believe that the Europeans love Obama so that they must be right in persisting in following him over the cliff?
We will never know for sure.
So a professor in the UK does not understand how voters could vote for one party and, after two years of bad experience, change their minds and vote for the opposition. Maybe the professor is also confused why people breathe out after they breathe in. Even for the Obama apologists at MSNBC this article is lame. Are Americans actually supposed to believe that europeans are confused? Are americans actually supposed to care what the europeans think about our politics? Indeed, are Americans to believe that europeans actually follow our politics in any degree of detail?
The truth is that there are certainly some Europeans who follow american politics, just as there are some in the USA who understand that the current UK government is a coalition between the Conservatives and the Liberal parties. I doubt, however, if there are too many Americans who would have the audacity to lament the fact that UK voters changed their mind in the last election and voted out Gordon Brown and the Labour party. We would respect the decision of the Brits and simply try to move forward with the new government of the UK. Indeed, I suspect that aside from the fools that spoke to MSNBC, that is exactly how most Brits feel about the current US election.
I do wonder why MSNBC puts this garbage out there. Is it to make their leftist audience feel better about the impending electoral debacle? Is it to let their audience believe that the Europeans love Obama so that they must be right in persisting in following him over the cliff?
We will never know for sure.
Armanino Foods of Distinction -- What to do now?
I was asked by a reader if I though it was time to sell Armanino Foods of Distinction (symbol AMNF on the Pink Sheets). After all, since the company announced that it would pay a special dividend and commence a stock repurchase program, the stock price has soared from 49 cents to 72 cents, a rise of just under 50% in a month and a half. Indeed, since the earnings eight days ago, the stock price has gone up 18% and had not even a single day with a price decline.
Even given this strong performance by Armanino, my recommendation is to hold the stock. We have a substantial postion in the stock and will not sell except in those accounts where the stock price rise has brought Armanino to be too large a percentage of the portfolio. As I write this, however, I have an order in to purchase the stock in another account.
The reasoning here is this: Armanino is on track to deliver earnings per share of at least 9 cents for the next twleve months. At the current 72 cent price, this is a price earnings multiple of only 8. On top of this, the company still has most of the stock repurchase program to complete, something which should support the price for some time to come. If the market even comes close to recognizing the high growth and high earnings of this stock, it has a long way to climb from here.
There are, of course, risks. First, we could see a general market decline -- but this applies to any stock. Second, the company could fail to execute in the coming quarters so that it misses its earnings; this is unlikely. The current management has consistently produced outstanding results and I am prepared to rely on them for the future. Third, the company could decide to leave the dividend unchanged for next year and to issue no further special dividends in the fourth quarter. I believe that for the stock to continue to rise, there needs to be either another special dividend or, preferably, a rise in the regular dividend rate.
The normal reaction after a 50% rise in six weeks is to take some of the money off the table by taking profits on part of ones holdings. I could not criticize anyone for taking that approach with Armanino. Nevertheless, there are a few times each year when it is best not to follow the standard routine. I believe that this is one of those times. My target for Armanino remains $1.30 and I recommend that no one sell now.
Diclosure: Long Armanino
Even given this strong performance by Armanino, my recommendation is to hold the stock. We have a substantial postion in the stock and will not sell except in those accounts where the stock price rise has brought Armanino to be too large a percentage of the portfolio. As I write this, however, I have an order in to purchase the stock in another account.
The reasoning here is this: Armanino is on track to deliver earnings per share of at least 9 cents for the next twleve months. At the current 72 cent price, this is a price earnings multiple of only 8. On top of this, the company still has most of the stock repurchase program to complete, something which should support the price for some time to come. If the market even comes close to recognizing the high growth and high earnings of this stock, it has a long way to climb from here.
There are, of course, risks. First, we could see a general market decline -- but this applies to any stock. Second, the company could fail to execute in the coming quarters so that it misses its earnings; this is unlikely. The current management has consistently produced outstanding results and I am prepared to rely on them for the future. Third, the company could decide to leave the dividend unchanged for next year and to issue no further special dividends in the fourth quarter. I believe that for the stock to continue to rise, there needs to be either another special dividend or, preferably, a rise in the regular dividend rate.
The normal reaction after a 50% rise in six weeks is to take some of the money off the table by taking profits on part of ones holdings. I could not criticize anyone for taking that approach with Armanino. Nevertheless, there are a few times each year when it is best not to follow the standard routine. I believe that this is one of those times. My target for Armanino remains $1.30 and I recommend that no one sell now.
Diclosure: Long Armanino
A Plan for the next two Years -- 3
If the Republicans take control of congress on Tuesday, one area where they need to act is energy production and usage. Over the last two years Obama has managed to lower oil production and exploration, increase regulation of energy production facilities, discourage the production of coal, threaten the pasage of a massive tax on all energy in the form of cap and trade and waste billions of dollars on wind and solar energies by pushing projects that make no sense. The Republicans need to bring some common sense rather than ideology to this issue. Obama and the Al Gore crowd all love solar and wind energy (unless it spoils their view), and they want to push these enrgy forms above all others. the problem, of course, is that neither solar nor wind has the ability to furnish a substantial portion of US energy needs for the foreseeable future. The love affair between the Obamacrats and wind/solar energy has meant that the Obamacrats have not acted rationally with regard to other forms of energy, and this is where Republicans need to move the debate.
The first thing that the GOP needs to do on this front is to take steps to promote the greater use of natural gas. The USA has ample reserves of this clean fuel which can provide much of the energy requirements of the nation using existing technology. Natural gas is abundant and low in price. Recent discoveries of new gas fields mean that reserves are increasing.
In the current congress there were two versions of the Natural Gas Act of 2010 that never made it to the floor for a vote. These laws provided incentives and tax credits to promote the production of natural gas powered vehicles as well as for the construction of a natural gas dispensing/refueling system. Just imagine! Each natural gas powered car gives off about half the emissions of the cleanest gasoline based car for the same usage. Each natural gas powered truck uses domestically produced natural gas instead of imported oil with the result that American jobs are created while foreign enemies get less moeny from us. Each bus powered by natural gas means that a whole new American vehicle industry is helped to grow, something that can be particularly reinforced if the tax credit for these vehicles is for those manufactured predominantly in the USA only.
The truth is that there is no down side to this program except for one thing: in the minds of the Obmacrats, this program would reduce the need for solar and wind energy. The American people, however, are not afflicted with the mass psychosis on this subject that seems to afflict Obama and nearly all of the Obamacrats. The enormous benefits from a natural gas vehicle program would be apparent to nearly everyone. Even more important, such a program would be of great benefit to the USA.
Needless to say, the GOP shold also oppose cap and trade. The last thing that the economy needs at this point is a massive energy tax that will not even have any positive impact on carbon emissions. In truth, cap and trade is akin to the conduct of those medieval zealots who thought self flagellation was the path to salvation. It does no good, but it surely will hurt.
The first thing that the GOP needs to do on this front is to take steps to promote the greater use of natural gas. The USA has ample reserves of this clean fuel which can provide much of the energy requirements of the nation using existing technology. Natural gas is abundant and low in price. Recent discoveries of new gas fields mean that reserves are increasing.
In the current congress there were two versions of the Natural Gas Act of 2010 that never made it to the floor for a vote. These laws provided incentives and tax credits to promote the production of natural gas powered vehicles as well as for the construction of a natural gas dispensing/refueling system. Just imagine! Each natural gas powered car gives off about half the emissions of the cleanest gasoline based car for the same usage. Each natural gas powered truck uses domestically produced natural gas instead of imported oil with the result that American jobs are created while foreign enemies get less moeny from us. Each bus powered by natural gas means that a whole new American vehicle industry is helped to grow, something that can be particularly reinforced if the tax credit for these vehicles is for those manufactured predominantly in the USA only.
The truth is that there is no down side to this program except for one thing: in the minds of the Obmacrats, this program would reduce the need for solar and wind energy. The American people, however, are not afflicted with the mass psychosis on this subject that seems to afflict Obama and nearly all of the Obamacrats. The enormous benefits from a natural gas vehicle program would be apparent to nearly everyone. Even more important, such a program would be of great benefit to the USA.
Needless to say, the GOP shold also oppose cap and trade. The last thing that the economy needs at this point is a massive energy tax that will not even have any positive impact on carbon emissions. In truth, cap and trade is akin to the conduct of those medieval zealots who thought self flagellation was the path to salvation. It does no good, but it surely will hurt.
The Elections -- Some bizarre theories
Midterm elections are five days away, and we are entering the silly season of predictions. Yesterday, I saw an article explaining that the Democrats would win the House and Senate with minimal losses because the polls undercount minorities like African Americans and Hispanics due to racism. In other words, a true progressive koolade drinker is now predicting victory for his forces on the basis of ideological engendered blindness. boy will this guy be surprised on Tuesday night. I also have seen explanations about how Christine O'Donnell will cause the Democrats to sweep Pennsylvania even though the polls of that state show a widening Republican lead over the last week. The professional prognosticators are setting the Republican pickups in the House at anywhere between 45 and 62, and each has a detailed analysis as to how the result was reached. Of course, none of them really knows. In the spirit of the season, I am going to give my own predictions.
I predict that the GOP will gain a net of 70 or more seats in the House.
I predict that the GOP will gain a net of 11 seats in the Senate.
I predict that the GOP will have a total of 32 governors after the election.
I predict that the GOP will pick up between 500 and 600 seats in state legislative bodies with the resulting pick up of at least 15 separate houses in those state legislatures.
I predict that the left will ascribe the losses to racism against Obama, xenophobia against Latinos, homophobia, and greed by the wealthy. I also predict that they will be completely wrong but that their inability to understand what happened will lead to further decline for the Democrat brand.
I predict that President Obama will talk a great deal about the need for compromise but that he will not compromise at all with Republicans on the core of his programs.
I predict that the Democrats will use the election results as an excuse to avoid voting on the tax rates during the lame duck session so that millions of middle class folks will get hit by the Alternative Minimum Tax for 2010 and the country will go into 2011 with higher tax rates for everyone.
Finally, I predict that at least some of my predictions will be wrong.
I predict that the GOP will gain a net of 70 or more seats in the House.
I predict that the GOP will gain a net of 11 seats in the Senate.
I predict that the GOP will have a total of 32 governors after the election.
I predict that the GOP will pick up between 500 and 600 seats in state legislative bodies with the resulting pick up of at least 15 separate houses in those state legislatures.
I predict that the left will ascribe the losses to racism against Obama, xenophobia against Latinos, homophobia, and greed by the wealthy. I also predict that they will be completely wrong but that their inability to understand what happened will lead to further decline for the Democrat brand.
I predict that President Obama will talk a great deal about the need for compromise but that he will not compromise at all with Republicans on the core of his programs.
I predict that the Democrats will use the election results as an excuse to avoid voting on the tax rates during the lame duck session so that millions of middle class folks will get hit by the Alternative Minimum Tax for 2010 and the country will go into 2011 with higher tax rates for everyone.
Finally, I predict that at least some of my predictions will be wrong.
The Stakes in Connecticut
As we come down to the wire in the election season, it is worth looking closely at the race for governor between Democrat Dan Malloy and Republican Tom Foley. While there are numerous differences between the two candidates, the most important one by far comes on the issues of spending and taxes. Malloy has a track record of raising taxes and spending while mayor of Stamford. He currently talks about holding down spending and limiting the rise of taxes, but he speaks mainly in generalities on the subject. His few specifics -- like reducing the number of agencies that report to the governor -- do not explain how costs would be reduced. For example, if ten departments are merged into eight, there may be no cost reduction unless redundant workers are eliminated. Malloy, however, has made clear that he has no intention of reducing state employment, so there will be no reduction in spending. Foley has never held public office, but he has a record in private industry of knowing how to reduce costs effectively. He also has a plan to reduce spending by $2 billion per year which provides reasonable detail as to how it will be done.
On taxes, Foley has been crystal clear: there will be no new taxes or tax increases. Malloy has not made such a pledge and has indicated that the income tax could rise to 8%, a statement that he quickly took back when he saw the reaction.
Malloy has also made commitments to the state employee unions that he will not reduce their salaries or benefits; that is a commitment that Foley has not been willing to make. Since labor costs are the single biggest component of the state budget, Malloy has already given away one of his biggest potential tools for reducing spending.
The choise comes down to this: If you want to see this state be competative so that it can restore jobs through the expansion of the economy, you need to vote for Foley. If you want to keep taxes from rising, you need to vote for Foley. If you want to see the runaway spending by the state brought under control, you need to vote for Foley. On the other hand, if you want to see business as usual continue unchanged in hartford, you should vote for Malloy.
On taxes, Foley has been crystal clear: there will be no new taxes or tax increases. Malloy has not made such a pledge and has indicated that the income tax could rise to 8%, a statement that he quickly took back when he saw the reaction.
Malloy has also made commitments to the state employee unions that he will not reduce their salaries or benefits; that is a commitment that Foley has not been willing to make. Since labor costs are the single biggest component of the state budget, Malloy has already given away one of his biggest potential tools for reducing spending.
The choise comes down to this: If you want to see this state be competative so that it can restore jobs through the expansion of the economy, you need to vote for Foley. If you want to keep taxes from rising, you need to vote for Foley. If you want to see the runaway spending by the state brought under control, you need to vote for Foley. On the other hand, if you want to see business as usual continue unchanged in hartford, you should vote for Malloy.
Wednesday, October 27, 2010
A Plan for the Next Two Years --2
What should the Republicans do with regard to health care if they win next week? Many candidates pledged to repeal Obamacare, and that pledge should not be forgotten. Indeed, one of the first things that the GOP should do is to put forth a bill that would just repeal the whole mess so that we can start over. This attempt, however, is symbolic. President Obama will never agree to the repeal of his biggest "achievement", and the GOP will have nowhere near the number of votes it would take to override that veto. So after the symbolic effort is made, what comes next? I believe that Republicans should do four things:
1. The GOP should stop implementation of Obamacare by defunding it. the myriad of regulatory bodies that were set up by obamacare all require funds to operate and those funds have to come from congress. Republicans should refuse to fund any program that is part of the implementation of obamacare. This effort will prevent Obamacare from moving forward and will mean that the law can still be effectively repealed in obama is beaten in 2012. It will also prevent the damage that Obamacare will do to the economy from hitting with full force.
2. Republicans should take on the problem of reducing the cost of medical treatment in the USA. Probably the easiest place to start is with Tort reform. Insurance costs for malpractice coverage drive the price of medical care ever higher, and the total cost for defensive medicine is in the hundreds of billions of dollars each year. there are certain easy steps that can be taken to greatly reduce these expenditures. First, Congress can pass a federal medical arbitration law. That statute would authorize the enforcement of agreements made prior to treatment for arbitration of malpractice claims. It should also make clear that arbitrators acting under that statute would not be authorized to award punitive damages. Further, the law should cap attorneys fees in these arbitrations at 20% of any recovery; this will fully compensate attorneys for their efforts but it will take some of the excesses out of the system. The law should also provide that the losing party in medical arbitration must pay the costs of the arbitration including all of the fees of the arbitrators. Finally, the law must provide that for all claims in excess of $100,000 there are to be three arbitrators including one doctor and one attorney among the three.
The net effect of this law should be to reduce both the number and cost of malpractice suits as well as the elimination of some of the more bizarre results in those actions. No longer would a doctor have to fear the wrath of a jury that does not understand the standard of care that is expected from a doctor and who only cares that there is a patient who is injured after receiving care.
3. Republicans should also take on the issue of pre-existing conditions. This can be done by requiring all insurance companies to offer policies that will cover those with pre-existing conditions. These policies will cost more than the regular ones, but there would be eoverage available for those who are already ill. These policies should still have the exception for pre-existing conditions, however, that applies for the first three months of coverage. It is inherently unfair to allow people to decide not to buy coverage until they get sick and let others pay premiums to keep the health system going. Those who want to be protected should have to make the choice for coverage and join the system before their illness manifests itself.
If there are those who cannot afford these new policies, there can be government assistance to help them pay the premiums.
4. Republicans should take on the waste and fraud in the Medicare system. We heard from Onbama and the Obamacrats that there is about half a trillion dollars of waste in that system that can be removed over the next decade. Of course, the Democrats did nothing to get rid of the waste and fraud. Republicans should go down that road in a big way. Imagine the benefit of having undercover agents who visit suspected Medicare mills and get the goods on practices that engage in wholesale fraud.
There are a large number of other actions that the GOP could take, but if it hits these four points, it will have gone a long way towards helping the country deal with the health care problems.
1. The GOP should stop implementation of Obamacare by defunding it. the myriad of regulatory bodies that were set up by obamacare all require funds to operate and those funds have to come from congress. Republicans should refuse to fund any program that is part of the implementation of obamacare. This effort will prevent Obamacare from moving forward and will mean that the law can still be effectively repealed in obama is beaten in 2012. It will also prevent the damage that Obamacare will do to the economy from hitting with full force.
2. Republicans should take on the problem of reducing the cost of medical treatment in the USA. Probably the easiest place to start is with Tort reform. Insurance costs for malpractice coverage drive the price of medical care ever higher, and the total cost for defensive medicine is in the hundreds of billions of dollars each year. there are certain easy steps that can be taken to greatly reduce these expenditures. First, Congress can pass a federal medical arbitration law. That statute would authorize the enforcement of agreements made prior to treatment for arbitration of malpractice claims. It should also make clear that arbitrators acting under that statute would not be authorized to award punitive damages. Further, the law should cap attorneys fees in these arbitrations at 20% of any recovery; this will fully compensate attorneys for their efforts but it will take some of the excesses out of the system. The law should also provide that the losing party in medical arbitration must pay the costs of the arbitration including all of the fees of the arbitrators. Finally, the law must provide that for all claims in excess of $100,000 there are to be three arbitrators including one doctor and one attorney among the three.
The net effect of this law should be to reduce both the number and cost of malpractice suits as well as the elimination of some of the more bizarre results in those actions. No longer would a doctor have to fear the wrath of a jury that does not understand the standard of care that is expected from a doctor and who only cares that there is a patient who is injured after receiving care.
3. Republicans should also take on the issue of pre-existing conditions. This can be done by requiring all insurance companies to offer policies that will cover those with pre-existing conditions. These policies will cost more than the regular ones, but there would be eoverage available for those who are already ill. These policies should still have the exception for pre-existing conditions, however, that applies for the first three months of coverage. It is inherently unfair to allow people to decide not to buy coverage until they get sick and let others pay premiums to keep the health system going. Those who want to be protected should have to make the choice for coverage and join the system before their illness manifests itself.
If there are those who cannot afford these new policies, there can be government assistance to help them pay the premiums.
4. Republicans should take on the waste and fraud in the Medicare system. We heard from Onbama and the Obamacrats that there is about half a trillion dollars of waste in that system that can be removed over the next decade. Of course, the Democrats did nothing to get rid of the waste and fraud. Republicans should go down that road in a big way. Imagine the benefit of having undercover agents who visit suspected Medicare mills and get the goods on practices that engage in wholesale fraud.
There are a large number of other actions that the GOP could take, but if it hits these four points, it will have gone a long way towards helping the country deal with the health care problems.
Will the Democrats vote on taxes?
After the election, there will be a lame duck session of congress in the full week before Thanksgiving. During that week, congress will finally have to reach a vote on the appropriations for almost all of the federal government. Democrats put these votes off in order to avoid the big spender label during the election, but the government needs to be funded so that it can continue to function. Beyond the appropriations bills, however, there is also the question of taxes on the table. Unless congress acts, tens of millions of folks will be pushed into paying the Alternative Minimum Tax for 2010 and dedctions and exclusions like the college tuition will disappear for 2010 as well. Beyond these items, however, is the big question of the tax rates for everyone 2011. The biggest increase in taxes in American history is scheduled to take place starting in January of 2011 unless the law is changed.
The Democrats left Washington to campaign without even bothering to vote on these taxes. My guess is that once they come back for the lame duck session, they will not vote this time either. It will be irresponsible, but, of course, it will avoid their taking a stand on the issue and will let them drop it in the laps of the Republicans to deal with.
The Democrats left Washington to campaign without even bothering to vote on these taxes. My guess is that once they come back for the lame duck session, they will not vote this time either. It will be irresponsible, but, of course, it will avoid their taking a stand on the issue and will let them drop it in the laps of the Republicans to deal with.
Tuesday, October 26, 2010
It's contempt that drives the Democrats
Watching the Democrats' campaigns this fall, one has to wonder what it is that drives their choices. We all know what their program has been: stimulus, massive spending, high debt, nationalization of industries, takeover of the healthcare system, cap and trade, etc. Even so, there are very few Democrats who talk about that program and even fewer who argue its merits. There is no policy debate underway as far as I can discern. Republicans talk about lower spending, lower taxes, less regulation, repeal of obamacare among other things, but most of the few Democrats who comment on this program state their agreement with the Republican agenda. Instead of presenting policy arguments, the Democrats rely on three basic points: 1) the current problems of the country are the fault of the Republicans; 2) things would be worse if the Republicans were in control; and 3) the individual Republican candidates are scary radicals who are beneath contempt.
Clearly, the Democrats have tested out their program in focus groups and polls and found that the country does not like their agenda. Rather than attempting to convince the people that the progressive agenda of the Democrats is the right one, the candidates have simply fallen back on the blame game strategy that they are using.
The problem with the Democrats' strategy is that the people who pay attention to it recognize it for what it is, an attempt to change the subject. It is not working. So we come back to the basic question: what drives the Democrats to make such choices in their campaigns. the simple answer is that the Democrats hold the average American in contempt. The Democrats believe that voters are too stupid to recognize these attempts to change the subject. They think that Americans are too distracted from what is happening to understand that Democrats have run away from their program. The Democrats actually think that by calling their opponents names and leveling charges with little or no basis in fact, Americans will decide that the Democrats deserve another term at the helm of the country. Democrats believe this even though no sane person with average intelligence could fall for this after giving the matter fifteen minutes of attention; only idiots would accept the Democrats' main points.
The Democrats' contempt for the average American has been on display for the last two years. The Tea Party was a racist group of evil mongers according to the Democrats. Indeed, they were a threat to society and they could become terrorists. The opponents of obamacare were also racists who only opposed the law at the behest of big phama or big insurance companies. The majority who opposed Obamacare was to be ignored; they were not even entitled to have their arguments considered. The Republicans were frozen out of all decision making on Capitol Hill and at the White House, but when the Democrats ran into problems, it was the fault of Republican obstructionism.
Back in high school english classes, we were taught that in a tragedy there was normally a character with a fatal flaw. Unfortunately for the country, we have just lived through two years of tragedy under the leadership of a group whose fatal flaw is that it holds the American people in contempt. No need to consider what the people want; the Democrats think they know better. Strangely, the Democrats have yet to realize that the people of America are the source of its strength. It is a government of the people, not of the Democrats or the progressives. the people determine what to do, no some army of nameless faceless bureaucrats in Washington. Next Tuesday, we will see the end of the tragedy. for once, there will be a happy ending as the years of total Democrat control come to an end.
Clearly, the Democrats have tested out their program in focus groups and polls and found that the country does not like their agenda. Rather than attempting to convince the people that the progressive agenda of the Democrats is the right one, the candidates have simply fallen back on the blame game strategy that they are using.
The problem with the Democrats' strategy is that the people who pay attention to it recognize it for what it is, an attempt to change the subject. It is not working. So we come back to the basic question: what drives the Democrats to make such choices in their campaigns. the simple answer is that the Democrats hold the average American in contempt. The Democrats believe that voters are too stupid to recognize these attempts to change the subject. They think that Americans are too distracted from what is happening to understand that Democrats have run away from their program. The Democrats actually think that by calling their opponents names and leveling charges with little or no basis in fact, Americans will decide that the Democrats deserve another term at the helm of the country. Democrats believe this even though no sane person with average intelligence could fall for this after giving the matter fifteen minutes of attention; only idiots would accept the Democrats' main points.
The Democrats' contempt for the average American has been on display for the last two years. The Tea Party was a racist group of evil mongers according to the Democrats. Indeed, they were a threat to society and they could become terrorists. The opponents of obamacare were also racists who only opposed the law at the behest of big phama or big insurance companies. The majority who opposed Obamacare was to be ignored; they were not even entitled to have their arguments considered. The Republicans were frozen out of all decision making on Capitol Hill and at the White House, but when the Democrats ran into problems, it was the fault of Republican obstructionism.
Back in high school english classes, we were taught that in a tragedy there was normally a character with a fatal flaw. Unfortunately for the country, we have just lived through two years of tragedy under the leadership of a group whose fatal flaw is that it holds the American people in contempt. No need to consider what the people want; the Democrats think they know better. Strangely, the Democrats have yet to realize that the people of America are the source of its strength. It is a government of the people, not of the Democrats or the progressives. the people determine what to do, no some army of nameless faceless bureaucrats in Washington. Next Tuesday, we will see the end of the tragedy. for once, there will be a happy ending as the years of total Democrat control come to an end.
Liberal Understanding and Civility
Last week, liberal Joy Behar walked off The View when Bill O'Reilly said that it was Muslims who killed us on 9-11. According to Behar and co-host Whoopi Goldberg that statement was "bullshit". O'Reilly was denigrating a whole religion and that was just plain wrong. People need to be civil and clear and understand that there are other Muslims besides those who supported the 9-11 attacks, or so said Behar.
Today, Behar showed us all how understanding and civil she is. After an ad for Sharron Angle was aired on the view, Behar had another melt down. In the ad, Angle points out that Harry Reid voted to give social security benefits, reduced college tuition and other benefits to illegal immigrants and that he supported the lawsuit against the Arizona law to enforce the US immigration statutes. All of that is fact. Behar, however, called the ad a "Hitler Youth commercial" and said that Angle was a "bitch" who "should go to hell". Nice Joy! it was one of those angry, irrational attacks that liberals like Behar always say come from the Tea Party.
In truth, Behar does more to reveal the true nature of liberalism in the USA than almost any other American. Each time she opens her big, big mouth to scream obscenities at a political opponent, she shows he intolerance of any viewpoint other than her own. Behar's idea of reaching across the aisle requires that she has a knife in her hand that she can use to slah those to whom she "reaches out". She shows that there is a group of old, frumpy, loud mouthed fools who are so devoid of logic that they have to resort to obscenities when confronted with facts. and for this, the media rewards her with her own show and a continuiong role on the View.
Imagine for a moment what would transpire if someone on the other side did the same thing. Let's say Sean Hanity ran a commercial for Barbara Boxer and then said that Boxer was in league with Nazi's and that she is a bitch who should go to hell. That would be the end of Hanity's career. But I predict that now that Behar says it about a conservative woman like Angle, Behar will just go on with her show; she will keep on spouting the same obscene, untruthful garbage.
Today, Behar showed us all how understanding and civil she is. After an ad for Sharron Angle was aired on the view, Behar had another melt down. In the ad, Angle points out that Harry Reid voted to give social security benefits, reduced college tuition and other benefits to illegal immigrants and that he supported the lawsuit against the Arizona law to enforce the US immigration statutes. All of that is fact. Behar, however, called the ad a "Hitler Youth commercial" and said that Angle was a "bitch" who "should go to hell". Nice Joy! it was one of those angry, irrational attacks that liberals like Behar always say come from the Tea Party.
In truth, Behar does more to reveal the true nature of liberalism in the USA than almost any other American. Each time she opens her big, big mouth to scream obscenities at a political opponent, she shows he intolerance of any viewpoint other than her own. Behar's idea of reaching across the aisle requires that she has a knife in her hand that she can use to slah those to whom she "reaches out". She shows that there is a group of old, frumpy, loud mouthed fools who are so devoid of logic that they have to resort to obscenities when confronted with facts. and for this, the media rewards her with her own show and a continuiong role on the View.
Imagine for a moment what would transpire if someone on the other side did the same thing. Let's say Sean Hanity ran a commercial for Barbara Boxer and then said that Boxer was in league with Nazi's and that she is a bitch who should go to hell. That would be the end of Hanity's career. But I predict that now that Behar says it about a conservative woman like Angle, Behar will just go on with her show; she will keep on spouting the same obscene, untruthful garbage.
The value of polls
As we get very close to Election Day, I wonder more and more about the value of polls. How many are accurate and how many are constructed so as to give a preordained result? For election races, the polls should all converge as we get close to the election. Even for those pollsters who inject bias into their numbers, there is a desire to appear to be correct when the actual numbers are counted. On the other hand, for questions like the job approval of the President which are never tested with actual voting, the impetus to move towards accuracy is never there. This often leads to strange results.
A good example of this phenomenon is the recent Newsweek poll of the public about Obama's job performance. During October 10 separate major polling organizations asked the public about they rating of obama's job performance. Of these polls, only two found more people approving of Obama than disapproving. One of the two was in Newsweek, the new self-proclaimed journal of liberal opinion. The Newsweek poll, taken at the end of last week found the public approves of Obama's performance by a margin of 54% to 40%. The other poll showing approval was from Pew and it found a one percent margin.
Is it mere coincidence that liberal Newsweek found a 14% margin of approval for Obama when no one else did? Is it possible that Newsweek had its poll tailored to give a result that its readers wanted to see? The statistical chance that the Newsweek poll is just the result of chance is very small. Newsweek supposedly polled over 1000 people to get its result while the other polls questioned over 8000 people.
The only reasonable conclusion that one can draw is that Newsweek rigged its poll to produce the result it wanted.
A good example of this phenomenon is the recent Newsweek poll of the public about Obama's job performance. During October 10 separate major polling organizations asked the public about they rating of obama's job performance. Of these polls, only two found more people approving of Obama than disapproving. One of the two was in Newsweek, the new self-proclaimed journal of liberal opinion. The Newsweek poll, taken at the end of last week found the public approves of Obama's performance by a margin of 54% to 40%. The other poll showing approval was from Pew and it found a one percent margin.
Is it mere coincidence that liberal Newsweek found a 14% margin of approval for Obama when no one else did? Is it possible that Newsweek had its poll tailored to give a result that its readers wanted to see? The statistical chance that the Newsweek poll is just the result of chance is very small. Newsweek supposedly polled over 1000 people to get its result while the other polls questioned over 8000 people.
The only reasonable conclusion that one can draw is that Newsweek rigged its poll to produce the result it wanted.
New York 20 -- The coming Avalanche
In the race for the Congressional seat in the 20th district of NY, Democrat incumbent Scott Murphy should have a big advantage. Murphy was elected last year in a special election. While that race was close, Murphy won and got his name spread across the district. That name recognition should have helped him to hold the seat this year. Further, since Murphy did not get to Congress until the middle of 2009, he avoided having to vote on the stimulus and some other goodies in the Obama - Pelosi agenda. Despite all of this, things are not looking good for Mr. Murphy. the latest poll in the district has Chris Gibson, his GOP challenger, up by 51% to 42%. The Siena poll was just released yesterday.
Because there has not been much polling in the district and because the prior polls from early September showed Murphy up by double digits, the race gets ranked as a toss up by most of the main rating sites. Nevertheless, if this poll is even close to being correct, Murphy is history. It will be another pickup for the GOP.
Because there has not been much polling in the district and because the prior polls from early September showed Murphy up by double digits, the race gets ranked as a toss up by most of the main rating sites. Nevertheless, if this poll is even close to being correct, Murphy is history. It will be another pickup for the GOP.
Monday, October 25, 2010
Early voting Spin
Reuters is out this afternoon with a piece headlined "Democrats off to a good start in early voting". This headline is just plain wrong. The main point of the article is that in a number of states, more registered Democrats have voted early than have registered Republicans. Reuters cites both Iowa and Louisiana as two such states. Of course, a few paragraphs later, Reuters sneaks in the truth and says that Republicans have "sharply improved" their performance from 2008 in those states. Another state with many early voting registered Democrats is West Virginia. In that state, Republicans are 6% more of the early voting electorate than in 2008, but more Democrats have voted. Reuters ignores the fact that in West Virginia, the old Southern pattern of voters being local Democrats and national Republicans still exists. Many folks are still registered Democrat even though they vote Republican regularly.
Another state that Reuters discusses is Nevada. In that state, Republicans are running about 15% better as a share of the early voting electorate than they did in 2008. While the figures are mentioned at the end of the article, the reporters somehow fail to point out that despite a Democratic registration edge, more Republicans than Democrats have voted so far across the state.
Wouldn't it be nice if news were actually factual rather than slanted to the advantage of the Democrats.
Another state that Reuters discusses is Nevada. In that state, Republicans are running about 15% better as a share of the early voting electorate than they did in 2008. While the figures are mentioned at the end of the article, the reporters somehow fail to point out that despite a Democratic registration edge, more Republicans than Democrats have voted so far across the state.
Wouldn't it be nice if news were actually factual rather than slanted to the advantage of the Democrats.
Eleanor Clift Loses it completely
In Newsweek, perpertual lefty hack Eleanor Clift is back at work. Her piece today is about how the Democrats can win this election as people realize the horror that a Republican victory would bring. If she were writing a satire, her piece would be somewhat funny, but this is no satire. It is a serious piece that sounds as if it were written for Saturday Night Live -- you know, one of those unfunny sketches that SNL uses to fill up the time.
A Plan for the Next Two Years -- 1
With election Day just a week away, it is time to begin discussing what should be done in the next two years in Washington. Right now, it seems likely that the GOP will control the House; the Senate is leaning towards continued control by the Democrats after major gains by the Republicans. We may see a narrow GOP control of the Senate or (less likely) narrow control of the House by the Democrats, but one thing is certain: the Democrats will no longer be able to govern without dealing with the Republicans. So what should the Republcians do?
Here is the answer: since the House must vote on any spending or taxation bills, the GOP should conduct itself as if it were in total control of the country. By this I mean that the GOP should only vote for spending that is necessary; waste needs to be cut out. For example, much has been said in recent days about the half billion dollars that is spent each year on the Corporation for Public Broadcasting. The GOP should just refuse to vote for any bill that funds CPB. The GOP should also refuse to vote for funding any program at the extravagant levels set by the current congress and Obama. Republicans will not have the power to make affirmative changes to the government; Obama's veto will stop any change like repeal of Obamacare. Nevertheless, the GOP will have its own veto on every cent of government spending. They should use that veto.
Republicans will have gotten their positions from this election by speaking in favor of fiscal responsibility. They need to support that position once they get to Washington.
The big bugaboo, however, is the memory of the government shutdown in the mid 90's. The GOP under the leadership of Gingrich brought the government to a halt and paid a political price for that. This time, however, there is no need to stop the government from functioning. If spending bills cannot be passed, then the GOP should vote for continuing resolutions that fund the government at the levels of 2008 spending. If Obama wants to shut the government, let him. It will be his choice.
Here is the answer: since the House must vote on any spending or taxation bills, the GOP should conduct itself as if it were in total control of the country. By this I mean that the GOP should only vote for spending that is necessary; waste needs to be cut out. For example, much has been said in recent days about the half billion dollars that is spent each year on the Corporation for Public Broadcasting. The GOP should just refuse to vote for any bill that funds CPB. The GOP should also refuse to vote for funding any program at the extravagant levels set by the current congress and Obama. Republicans will not have the power to make affirmative changes to the government; Obama's veto will stop any change like repeal of Obamacare. Nevertheless, the GOP will have its own veto on every cent of government spending. They should use that veto.
Republicans will have gotten their positions from this election by speaking in favor of fiscal responsibility. They need to support that position once they get to Washington.
The big bugaboo, however, is the memory of the government shutdown in the mid 90's. The GOP under the leadership of Gingrich brought the government to a halt and paid a political price for that. This time, however, there is no need to stop the government from functioning. If spending bills cannot be passed, then the GOP should vote for continuing resolutions that fund the government at the levels of 2008 spending. If Obama wants to shut the government, let him. It will be his choice.
Sunday, October 24, 2010
Who can be criticized?
The Juan Williams political correctness firing by NPR gives rise to a question that is worth discussing: under liberal orthodoxy who is it that is allowed to be criticized? Let's start with the obvious. It is improper to criticize Muslims; Juan proved that clearly. Second, it is also improper to criticize blacks unless they are conservatives. Remember all the discussion about how the Tea Parties were racist because they criticized Obama (a liberal), but no one cares about all the disparaging of Clarence Thomas after his wife's private phone call to Anita Hill was released by Hill and put into the media. Hispanics are classified like blacks. There seems to be insufficient data to determine if Asians can be criticized. I have not seen much criticism of them nor any response from the liberal groups. So we will put Asians in the unknown category. Within the group of whites, it is a cardinal sin to criticize women if they are liberal. Any criticism of liberal women bring immediate condemnation from NOW and the other self-proclaimed feminist groups, and the media joins right in. Of course, if Jerry Brown calls Meg Whitman a whore, it is ok because she is conservative. Under liberal orthodoxy Sarah Palin can be called any name that one can thing of. Gays are also protected by liberal orthodoxy. So are atheists and transgenders.
So that leaves the targets. Religious Christians and Jews are prime targets. They are intolerant, bigoted, homophobic, racist etc. Conservative white men are even worse. And let's not forget that American conservative men are the equivalent of the devil -- if the liberals believed in the devil. Just today in the NY Times, Ari Berman wrote an Op-Ed piece in which he said, "Conservative Democrats have opposed key elements of the president’s agenda, while liberal Democrats have howled that their majority is being hijacked by a rogue group of predominantly white men from small rural states." That's right, conservative white men and hicks no less have blocked Obama's agenda.
I wonder if there ever was a time when the liberals believed that they were actually protecting these groups by shielding them from criticism? I doubt it. American society long ago moved past the point when criticism of people in these protected groups was based upon bigotry, sexism, racism or the like. Now, it is based upon reality, but the liberals are so caught up in their ideology that they cannot see reality.
Here's an example. Many inner city schools are failing. The students in these schools, mostly black and Hispanic perform at much lower levels than their counterparts in other districts. Nevertheless, a message to these students that called upon them to use their own strengths to improve would be an outrage to most liberals. After all, it would imply that the fault for the poor performance of these students actually lay with those very students rather than with society. Asking for self reliance from the students would tell them that they had failed thus far, and it would lower their self esteem. No, liberals want to baby these kids and leave them dependent for their whole lives on the state.
So that leaves the targets. Religious Christians and Jews are prime targets. They are intolerant, bigoted, homophobic, racist etc. Conservative white men are even worse. And let's not forget that American conservative men are the equivalent of the devil -- if the liberals believed in the devil. Just today in the NY Times, Ari Berman wrote an Op-Ed piece in which he said, "Conservative Democrats have opposed key elements of the president’s agenda, while liberal Democrats have howled that their majority is being hijacked by a rogue group of predominantly white men from small rural states." That's right, conservative white men and hicks no less have blocked Obama's agenda.
I wonder if there ever was a time when the liberals believed that they were actually protecting these groups by shielding them from criticism? I doubt it. American society long ago moved past the point when criticism of people in these protected groups was based upon bigotry, sexism, racism or the like. Now, it is based upon reality, but the liberals are so caught up in their ideology that they cannot see reality.
Here's an example. Many inner city schools are failing. The students in these schools, mostly black and Hispanic perform at much lower levels than their counterparts in other districts. Nevertheless, a message to these students that called upon them to use their own strengths to improve would be an outrage to most liberals. After all, it would imply that the fault for the poor performance of these students actually lay with those very students rather than with society. Asking for self reliance from the students would tell them that they had failed thus far, and it would lower their self esteem. No, liberals want to baby these kids and leave them dependent for their whole lives on the state.
Obama attacks the Car companies
It is a strange twist that Obama is now taking an action that will hurt American car companies even while the government owns much of the industry. The news today is that the adminstration will release tomorrow new regulations that require trucks to improve their gas mileage by 20% over the next three years. Of course, trucks are the main area where the Big Three have a lead over the foreign manufacturers. These new regulations will require major design changes for all trucks so that the existing American advantage will be lost. Worse still, the new regulations will require enormous costs to redesign and retool for the modified trucks. The changes will force the american companies to lose much of their investment in the current equipment used to make trucks. In short, these new regulations will hurt the Big Three, reduce jobs in american plants, increase the costs of trucks made in the US so as to render them less competative in other markets and, in general, to be anti business like much of Obama's other agenda.
Just imagine if Obama had used a little imagination to move in a direction that could help American companies and increase American jobs while achieving the same benefits. The government could have announced that it was going to buy trucks and buses powered by natural gas starting in a few years. First, this would have shifted energy usage from imported oil to domestic natural gas. This change would mean a boost to American jobs and growth, since the natural gas industry is adding workers to allow it to produce more output already. Second, natural gas vehicles already exist (like the buses used in new York city) and they produce only about 25% of the emissions of the comparable oil powered vehicles. In other words, these nat gas vehicles would reduce emissions and greenhouse gases by much more than the change ordered by Obama. Third, the government's switch to nat gas vehicles would promote the installation of a national infrastructure that would allow others to buy nat gas vehicles. If that could lead to even one-tenth of our vehicles using nat gas, the savings would be something like 100 billion dollars that would stay in the USA rather than going to Iran, Venezuela and other enemies abroad. There would also be a significant reduction in air pollution. Most important, such a switch could possibly produce 1,000,000 new jobs right here in the USA. Finally, if the Big Three were able to get the jump on foreign competitors with regard to the nat gas vehicles, these could be sold world wide with major benefits for the US economy.
Of course, were Obama to move the US towards natural gas vehicles, that would be a solution that relies on market forces to help achieve the required goals. Obama, instead, went for the plan that uses government control as the only means to achieve the end desired. It is a sad thing for the US that no one among the Obamacrats understands how the economy actually works.
Just imagine if Obama had used a little imagination to move in a direction that could help American companies and increase American jobs while achieving the same benefits. The government could have announced that it was going to buy trucks and buses powered by natural gas starting in a few years. First, this would have shifted energy usage from imported oil to domestic natural gas. This change would mean a boost to American jobs and growth, since the natural gas industry is adding workers to allow it to produce more output already. Second, natural gas vehicles already exist (like the buses used in new York city) and they produce only about 25% of the emissions of the comparable oil powered vehicles. In other words, these nat gas vehicles would reduce emissions and greenhouse gases by much more than the change ordered by Obama. Third, the government's switch to nat gas vehicles would promote the installation of a national infrastructure that would allow others to buy nat gas vehicles. If that could lead to even one-tenth of our vehicles using nat gas, the savings would be something like 100 billion dollars that would stay in the USA rather than going to Iran, Venezuela and other enemies abroad. There would also be a significant reduction in air pollution. Most important, such a switch could possibly produce 1,000,000 new jobs right here in the USA. Finally, if the Big Three were able to get the jump on foreign competitors with regard to the nat gas vehicles, these could be sold world wide with major benefits for the US economy.
Of course, were Obama to move the US towards natural gas vehicles, that would be a solution that relies on market forces to help achieve the required goals. Obama, instead, went for the plan that uses government control as the only means to achieve the end desired. It is a sad thing for the US that no one among the Obamacrats understands how the economy actually works.
Where did these folks come from? --Virginia 8 CD
Representative Jim Moran comes from Virginia's 8th congressional district, and has been in office for 18 years already. The 8th includes the close in suburbs of DC on the Virginia side of the Potomac. It is home to many government workers and is exceeding friendly to the Democrats. In other words, even in 2010, the Democrat is not under much pressure from the GOP. So that leads to a big question: where do folks like Moran come from? Who, if anyone, ever taught them about reality?
Earlier this week, Moran spoke at a fundraiser where he said, “What [Republicans] do is find candidates, usually stealth candidates, that haven’t been in office, haven’t served or performed in any kind of public service. My opponent [Murray] is typical, frankly.”
That Republican, Patrick Murray, served 24 years in the army and left a colonel. So Moran (or better Moron) thinks that 24 years in the US Army is not "any kind of public service"? Putting your life on the line for your country is not public service? Going overseas to a war zone to protect Americans is not a public service? Wow!
Moran is an idiot. The truth is that his comments could be better paraphrased this way: "What Democrats do is find candidates, usually smug liberal ones, that haven't ever worked anywhere other than on the public payroll as some kind of bureaucrat or other functionary in Washington, people who have no real life experience. Moran is typical, frankly."
The race in Virigina 8th is not close according to the polls. Hopefully, however, this smear by Moran against those who have served this country admirably will not go unpunished. Let's hope that the voters realize that Moran is a moron who does not deserve to be in congress.
Earlier this week, Moran spoke at a fundraiser where he said, “What [Republicans] do is find candidates, usually stealth candidates, that haven’t been in office, haven’t served or performed in any kind of public service. My opponent [Murray] is typical, frankly.”
That Republican, Patrick Murray, served 24 years in the army and left a colonel. So Moran (or better Moron) thinks that 24 years in the US Army is not "any kind of public service"? Putting your life on the line for your country is not public service? Going overseas to a war zone to protect Americans is not a public service? Wow!
Moran is an idiot. The truth is that his comments could be better paraphrased this way: "What Democrats do is find candidates, usually smug liberal ones, that haven't ever worked anywhere other than on the public payroll as some kind of bureaucrat or other functionary in Washington, people who have no real life experience. Moran is typical, frankly."
The race in Virigina 8th is not close according to the polls. Hopefully, however, this smear by Moran against those who have served this country admirably will not go unpunished. Let's hope that the voters realize that Moran is a moron who does not deserve to be in congress.
Saturday, October 23, 2010
An Election Summary
In just ten days, the election will be here. It is important to remember what is at stake when you vote. This is one of the most important elections in recent years. While politicians always tell us of the importance of the impending election, this one truly is critical. You need to vote!
Here is what is at stake:
1) Taxes -- the Democrats want to raise taxes in the middle of a recession. This is true both in Washington and Hartford. Republicans are against tax increases. There are a whole series of taxes under consideration including income taxes, estate taxes, energy taxes, healthcare taxes and even a national sales tax. In general, it is the Democrats who are pushing raises in these taxes, with the GOP opposed.
This is not just a question of taxes, however. Each time taxes are raised, money is sucked out of the economy and jobs are lost. In addition, growth is slowed or stopped and that means that no new jobs are created. Democrats argue that they need the additional taxes to pay for all the new spending that they have pushed through in the last two years. What they fail to recognize is that raising taxes may actually reduce government receipts. The unemployed do not pay income taxes. Even the wealthy will redistribute their investments to minimize taxes if the rates are high enough. So the Democrats taxing plans will reduce jobs, reduce growth that would lead to additional jobs and still not raise government income. No wonder the Republicans are opposed.
2. Spending -- Democrats have no plans to stop the meteoric rise in spending. Oh, President Obama gives lip service to a "freeze" on discretionary spending, but none of the other Democrats are talking about that. Indeed, in the two years since taking office, Obama has presided over an 84% increase in discretionary federal spending. Now he talks about a freeze at those high levels. Republicans, on the other hand, are talking about spending cuts. The Pledge to America calls for a return to the 2008 levels of federal discretionary spending. That would cut hundreds of billions of dollars of spending right there. Republicans also want to tackle the other big spending problems that face the government, namely entitlements.
Democrats do not ever discuss specific spending cuts, but they frequently criticize the Republicans as having no specifics for their proposed cuts. this criticism ignores reality. Cutting spending to 2008 levels is very specific. Indeed, even when Republicans mention specific programs to be cut (like the money for NPR), the Democrats say there are not enough specifics. It is almost as if they are speaking another language.
Simply put, if you think that the level of government spending is too high, you should vote for the Republicans. If you want still more spending which will be paid for through increased debt, then vote for the Democrats.
3. The federal deficit -- since we spoke about taxes and spending, you would think that the federal deficit would also be covered, but it deserves separate attention. The deficit is not curable through tax increases; increases high enough to close the deficit will actually reduce government revenues by driving investments into tax free or tax sheltered areas. They would also reduce growth and jobs in the USA. Spending cuts are unlikely alone to close the entire deficit as well. The Republicans want to make cuts in some of the more extravagant and wasteful programs thrown into the budget by the Democrats, but it will not be enough to close the budget gap. The only way to close that gap is to increase economic growth. If the economy prospers, fewer people will need government help, so expenditures will fall. At the same time, more people will have jobs, earn money and prosper, so tax revenues will increase. this is the best method to close the budget deficit. So pro-growth policies are needed both in Washington and Hartford.
Democrats have adopted a series of anti-growth policies and they are pushing for more. The Democrats have pushed through enormous new regulations and costs for business that act to retard or reverse economic growth. For example, the so-called Financial Reform bill requires all banks and brokerage firms in the US to meet racial, ethnic and gender quotas in their work forces in order to deal with the government. Then it establishes sixteen separate agencies whose duties include enforcement of these quotas. It does not take a genius to understand that financial firms -- which need to compete worldwide -- will do better if they and hire the best person for each job rather than the one who meets the racial, gender and ethnic quota set by the government. Just the cost alone of making sure that the firm meets the government requirements will drive the cost of doing business in the USA up and thereby give an advantage to competitors in London, Hong Kong or Singapore. these regulations will reduce economic growth. Another example is the huge pile of new regulations about healthcare that are spewing out of Washington following the passage of Obamacare by the Democrats. Instead of just hiring a new employee, a business owner has to consider what additional expenses the new hire will bring once all of the obamacare regulations have been issued. This too slows job and economic growth.
Republicans have called for a freeze on new regulations that affect business. Democrats want to move ahead on all of them.
4 Energy -- Democrats have done a good job of reducing US energy production so that we have become more dependent on foreign energy sources. New off shore drilling was stopped for essentially all of the last two years. Then, in the aftermath of the botched cleanup in the Gulf, even the existing areas of off shore driling were closed. Democrats have done nothing to enhance production of clean, abundant natural gas in the USA. Instead, they have putup obstacles to production of this fuel which could both cut oil imports dramatically and clean up the environment in a major way. On top of this, the Democrats almost passed cap and trade and continue to push for it. Cap and trade would drive up the cost of home heating, gasoline, electricity and all other energy in the USA. It would also kill hundreds of thousands of jobs. Oh, and it would NOT make a meaningful reduction in the level of US emissions.
Republicans do not support cap and trade. They also do not want to thwart the domestic production of energy. They support the expanded production of natural gas.
The choice here is clear. Republicans will keep energy costs lower and will do more to clean up the environment by promoting natural gas.
One more note here is needed. Democrats want to promote wind and solar energy as the fuels of the future. While that is nice, the problem is that even the Democrats agree that over the next ten years neither wind nor solar can provide any meaningful portion of the US energy supply at a reasonable cost. The Democrats push for these energy sources may please the environmentalists, but it undermines the economy while providing no real environmental benefit.
5. Defense -- on the subject of national defense, the Democrats need a reality check. Most of the Democrats in congress do not even want to talk about Muslim terrorism. They react like the ladies on the view if someone points out that the 9/11 terrorists were Muslims who acted in the name of Allah. In the two years since Obama has taken office, we have seen the Times Square Bomber, the Fort Hood Massacre, the Christmas Underwear bomber and some other domestic attacks or attempts at attacks on targets here in the USA. After 9/11 with the Republicans in control, there were no further attacks in the US. It may be coincidence, but I believe that the refusal of the Democrats to see the real problem of Islamic terrorism has contributed to our failure to stop each of these attacks.
There are many other issues where Democrats and Republicans disagree, but these are the key ones in my opinion. Personally, I do not see how any sane person could vote for the Democrats, but hey, that's just me.
Here is what is at stake:
1) Taxes -- the Democrats want to raise taxes in the middle of a recession. This is true both in Washington and Hartford. Republicans are against tax increases. There are a whole series of taxes under consideration including income taxes, estate taxes, energy taxes, healthcare taxes and even a national sales tax. In general, it is the Democrats who are pushing raises in these taxes, with the GOP opposed.
This is not just a question of taxes, however. Each time taxes are raised, money is sucked out of the economy and jobs are lost. In addition, growth is slowed or stopped and that means that no new jobs are created. Democrats argue that they need the additional taxes to pay for all the new spending that they have pushed through in the last two years. What they fail to recognize is that raising taxes may actually reduce government receipts. The unemployed do not pay income taxes. Even the wealthy will redistribute their investments to minimize taxes if the rates are high enough. So the Democrats taxing plans will reduce jobs, reduce growth that would lead to additional jobs and still not raise government income. No wonder the Republicans are opposed.
2. Spending -- Democrats have no plans to stop the meteoric rise in spending. Oh, President Obama gives lip service to a "freeze" on discretionary spending, but none of the other Democrats are talking about that. Indeed, in the two years since taking office, Obama has presided over an 84% increase in discretionary federal spending. Now he talks about a freeze at those high levels. Republicans, on the other hand, are talking about spending cuts. The Pledge to America calls for a return to the 2008 levels of federal discretionary spending. That would cut hundreds of billions of dollars of spending right there. Republicans also want to tackle the other big spending problems that face the government, namely entitlements.
Democrats do not ever discuss specific spending cuts, but they frequently criticize the Republicans as having no specifics for their proposed cuts. this criticism ignores reality. Cutting spending to 2008 levels is very specific. Indeed, even when Republicans mention specific programs to be cut (like the money for NPR), the Democrats say there are not enough specifics. It is almost as if they are speaking another language.
Simply put, if you think that the level of government spending is too high, you should vote for the Republicans. If you want still more spending which will be paid for through increased debt, then vote for the Democrats.
3. The federal deficit -- since we spoke about taxes and spending, you would think that the federal deficit would also be covered, but it deserves separate attention. The deficit is not curable through tax increases; increases high enough to close the deficit will actually reduce government revenues by driving investments into tax free or tax sheltered areas. They would also reduce growth and jobs in the USA. Spending cuts are unlikely alone to close the entire deficit as well. The Republicans want to make cuts in some of the more extravagant and wasteful programs thrown into the budget by the Democrats, but it will not be enough to close the budget gap. The only way to close that gap is to increase economic growth. If the economy prospers, fewer people will need government help, so expenditures will fall. At the same time, more people will have jobs, earn money and prosper, so tax revenues will increase. this is the best method to close the budget deficit. So pro-growth policies are needed both in Washington and Hartford.
Democrats have adopted a series of anti-growth policies and they are pushing for more. The Democrats have pushed through enormous new regulations and costs for business that act to retard or reverse economic growth. For example, the so-called Financial Reform bill requires all banks and brokerage firms in the US to meet racial, ethnic and gender quotas in their work forces in order to deal with the government. Then it establishes sixteen separate agencies whose duties include enforcement of these quotas. It does not take a genius to understand that financial firms -- which need to compete worldwide -- will do better if they and hire the best person for each job rather than the one who meets the racial, gender and ethnic quota set by the government. Just the cost alone of making sure that the firm meets the government requirements will drive the cost of doing business in the USA up and thereby give an advantage to competitors in London, Hong Kong or Singapore. these regulations will reduce economic growth. Another example is the huge pile of new regulations about healthcare that are spewing out of Washington following the passage of Obamacare by the Democrats. Instead of just hiring a new employee, a business owner has to consider what additional expenses the new hire will bring once all of the obamacare regulations have been issued. This too slows job and economic growth.
Republicans have called for a freeze on new regulations that affect business. Democrats want to move ahead on all of them.
4 Energy -- Democrats have done a good job of reducing US energy production so that we have become more dependent on foreign energy sources. New off shore drilling was stopped for essentially all of the last two years. Then, in the aftermath of the botched cleanup in the Gulf, even the existing areas of off shore driling were closed. Democrats have done nothing to enhance production of clean, abundant natural gas in the USA. Instead, they have putup obstacles to production of this fuel which could both cut oil imports dramatically and clean up the environment in a major way. On top of this, the Democrats almost passed cap and trade and continue to push for it. Cap and trade would drive up the cost of home heating, gasoline, electricity and all other energy in the USA. It would also kill hundreds of thousands of jobs. Oh, and it would NOT make a meaningful reduction in the level of US emissions.
Republicans do not support cap and trade. They also do not want to thwart the domestic production of energy. They support the expanded production of natural gas.
The choice here is clear. Republicans will keep energy costs lower and will do more to clean up the environment by promoting natural gas.
One more note here is needed. Democrats want to promote wind and solar energy as the fuels of the future. While that is nice, the problem is that even the Democrats agree that over the next ten years neither wind nor solar can provide any meaningful portion of the US energy supply at a reasonable cost. The Democrats push for these energy sources may please the environmentalists, but it undermines the economy while providing no real environmental benefit.
5. Defense -- on the subject of national defense, the Democrats need a reality check. Most of the Democrats in congress do not even want to talk about Muslim terrorism. They react like the ladies on the view if someone points out that the 9/11 terrorists were Muslims who acted in the name of Allah. In the two years since Obama has taken office, we have seen the Times Square Bomber, the Fort Hood Massacre, the Christmas Underwear bomber and some other domestic attacks or attempts at attacks on targets here in the USA. After 9/11 with the Republicans in control, there were no further attacks in the US. It may be coincidence, but I believe that the refusal of the Democrats to see the real problem of Islamic terrorism has contributed to our failure to stop each of these attacks.
There are many other issues where Democrats and Republicans disagree, but these are the key ones in my opinion. Personally, I do not see how any sane person could vote for the Democrats, but hey, that's just me.
The Avalanche is here
I have been writing about the various House races for some time under the heading of "The Coming Avalanche". With today's news, I am changing that to "The Avalanche is Here!" As of this morning, there are now 220 seats that are ranked by Real Clear Politics as safe, likely or leaning Republican. There are 178 seast so ranked for the Democrats. A majority of the House is 218 seats, so for the first time there is a majority showing for the GOP. this is not just another group taking a stab at ranking races. RCP relies on polling and it does not move races to one party or the other unless the candidate is substantially ahead. There are also another 37 seats listed as toss ups or too close to call. The momentum in the House races is all towards the GOP. If the trend continues, it is not hard to see the GOP with a pick up of 75 or more seats. The Avalanche is here!!!!!!!!!!!
Friday, October 22, 2010
Jim Himes and Lies about Energy
Recently, Democrat Jim Himes has started running new ads on TV as part of his campaign for re-election to congress from the 4th District of Connecticut. First, Himes claims that solar and wind energy are the means to energy independence. Then Himes castigates Republican Dan Debicella for opposing these energy sources. The ad is total nonsense.
The big difference on energy between Himes and Debicella is that Himes voted for Obama's cap and trade bill and Debicella does not support it. The relevant facts are simple: if cap and trade is passed, connecticut is estimated to lose about 20,000 jobs, heating bills are estimated to go up just about $1000 per year and gasoline will rise by 50-60 cents per gallon. In addition, there will be no appreciable effect on the global emission of greenhouse gases. That's right; the US will cripple its economy but the levels of greenhouse gases will not stop rising!
The truth is that the answer to the US energy problems is the adoption of abundant natural gas as our principal domestic fuel. new discoveries and extraction methods have resulted in the USA having a sufficient supply of natural gas to meet essentially all of its energy needs. Solar and Wind energy are fine for future development when the cost can come down to reasonable levels. For now, hoever, gas is the answer, and natural gas could cut emission levels by 50 to 80% from those that come from coal or oil.
Unfortunately, the gas we get from Himes comes out his mouth as he lies about Debicella's record. In Himes view, Debicella's opposition to cap and trade is the equivalent to opposition to solar and wind energy. this is a lie. On this issue alone, Himes deserves to go.
The big difference on energy between Himes and Debicella is that Himes voted for Obama's cap and trade bill and Debicella does not support it. The relevant facts are simple: if cap and trade is passed, connecticut is estimated to lose about 20,000 jobs, heating bills are estimated to go up just about $1000 per year and gasoline will rise by 50-60 cents per gallon. In addition, there will be no appreciable effect on the global emission of greenhouse gases. That's right; the US will cripple its economy but the levels of greenhouse gases will not stop rising!
The truth is that the answer to the US energy problems is the adoption of abundant natural gas as our principal domestic fuel. new discoveries and extraction methods have resulted in the USA having a sufficient supply of natural gas to meet essentially all of its energy needs. Solar and Wind energy are fine for future development when the cost can come down to reasonable levels. For now, hoever, gas is the answer, and natural gas could cut emission levels by 50 to 80% from those that come from coal or oil.
Unfortunately, the gas we get from Himes comes out his mouth as he lies about Debicella's record. In Himes view, Debicella's opposition to cap and trade is the equivalent to opposition to solar and wind energy. this is a lie. On this issue alone, Himes deserves to go.
How to waste tax dollars -- give them to the government
For the second time this year, the radio is playing ads from the new York Board of Elections explaining to voters how to use the new electronic voting method. I've voted with this method in Connecticut for the last few elections and it is quite easy. For those who do not understand how to use a pen to fill in a circle, the poll watchers can help. Nevertheless, the radio ads are a scream. I've listened to them and find them hard to follow. One only wonders how much money has been spent by the board of elections to air these confusing messages.
Today, there is more news out about the stellar efforts of the New York Board of Elections. The millions of paper ballots used for the electronic voting machines all state that to vote for a candidate, "fill in the oval above or next to the name of that candidate". The problem is that the ovals are below the names of the candidates, not above and not next to them. Since the ballots are one sheet of paper, it could not have been too difficult to proof read them. The Board of Elections, however, failed to do so. Now it says that it will put up signs at the polling places to correct the error. I know that New York politics is rough, but where did they get the folks at the board of elections -- from the "Your Intelligence is Too Damn High party"?
Today, there is more news out about the stellar efforts of the New York Board of Elections. The millions of paper ballots used for the electronic voting machines all state that to vote for a candidate, "fill in the oval above or next to the name of that candidate". The problem is that the ovals are below the names of the candidates, not above and not next to them. Since the ballots are one sheet of paper, it could not have been too difficult to proof read them. The Board of Elections, however, failed to do so. Now it says that it will put up signs at the polling places to correct the error. I know that New York politics is rough, but where did they get the folks at the board of elections -- from the "Your Intelligence is Too Damn High party"?
"QE2 or How I learned to stop worrying and love inflation"
Speculation is rife that the Federal Reserve is about to embark on a second round of so-called quantitative easing or QE2 as the media calls it. One of my readers asked me today what this really means. QE2 is a program by the Fed of buying treasury bonds. In other words, the Fed prints up more goes into the bond market and buys government bonds. this has two immediate effects: it lowers the interest rates on the government bonds and it increases the money supply. Let's look first at interest rates. The bond market sets rates based upon the demand for treasury instruments. the more demand there is for treasury bonds, the lower interest rates will go. So if the Fed steps in and buys 100 billion dollars of treasury bonds, there will be a marked effect on interest rates. Right now, short term rates are about as close to zero as possible, so the purchases by the Fed will most likely be in the longer maturities like ten, twenty or thirty years. So the Fed will be able to use QE2 to bring down the ten year bond to 2% or the thirty year bond to 3%.
At the same time that interest rates fall, the money supply will soar. why is that? In simplest terms, the Fed gets the funds to buy these bonds by printing new currency. If you look at your US currrency, you will see that it consists of Federal Reserve Notes. These are promises to pay by the Federal Reserve Bank, so the Fed can simply print more cash and use it to buy the bonds. Of course, each time the Fed prints more money, it increases the money supply. Using QE2 to buy a trillion dollars of government bonds would increase the money supply by a massive percentage.In 2009, during the first quantitative easing, the Fed essentially doubled the money supply. An increase of another trillion dollars would raise this newly inflated money supply by more than 50%.
So what is the effect the lower interest rates that would result from QE2? first, it would probably make all long term interest rates go down. that would let corporations and state and local governments borrow at lower costs as well. This would reduce the squeeze on the state and local governments to a small extent. It would also allow businesses to borrow at a lower cost to hopefully expand and hire new people. It would also lower mortgage and car loan rates. That is the good side. On the other side, the lower long term interest rates would reduce the income of those who live off of interest income, principally elderly retired folks. These people have already seen their money market and CD returns plunge to near zero rates. QE2 would send corporate rates lower as well, further reducing the income of this segment of society. there is no reliable data that can predict the change in consumption by these folks that will result from their losing a still greater part of their incomes as interest rates decline. Then there is the issue of whether or not lower long term rates would actually stimulate the economy. Right now, corporations are sitting on a huge pile of cash and are not investing due to fears about future demand; there is no shortage of funds to borrow at current rates. Further, mortgage rates are at historic lows and housing purchases seem unaffected by the low rates. Is there any reason to believe that even lower rates will jump start the housing market?
And what is the effect of an exploding money supply? Economic theory says that if the money supply increases too fast, there will be a big increase in inflation. The old description of inflation as too much money chasing too few goods explains why. If you increase the money without increasing the goods produced, you get inflation. So why, you may ask, have we not seen inflation as a result of the first quantitative easing? the answer lies with something called the "velocity of money" or the speed with which money travels through the economy. Because of the recession, many folks took their cash and saved it at much higher rates than before the recession began. So as the Fed added money to the system, the people stopped it from moving by putting it into savings rather than spending it. In theory, however, as the economy recovers from the recession (assuming it ever does), people will take their savings and return to old consumption patterns. That will increase the velocity of money which, in turn, will lead to higher inflation.
In the 1980's, the money supply was watched carefully to see if it had increased by an extra percent or two which could cause inflation. the stock market gyrated with each report of the money supply due to fear of inflation. With QE2 in place, we could see a money supply that is three times higher than that which was in place at the start of the recession. Just imagine what kind of inflation will result. We may be seeing inflation of the sort that only appeared in 1920's Germany and certain third world countries that have had economic melt downs.
Given these outcomes, you may wonder why the Fed would undertake QE2. I have to say that I wonder the same thing myself. There may be some short term benefit for the economy to the lower interest rates, but the long term dangers are enormous. Of course, there is one long term result that may be the Fed's goal in all of this. QE2 allows the government ot monetize the federal debt. In other words, instead of paying back the debt by taxing folks to raise the money, the government will merely print up some additional money and sent it out to the bond holders. this will take the pressure off the federal government for a year or so with regard to the debt. It will, however, make the holders of US debt more than a little nervous. Imagine the Central Bank in China that holds a trillion dollars or so of US bonds. Would that bank want to keep holding those bonds and even buy more if it suspected that the dollar would soon collapse due to increased US inflation? The answer is no. So That means that as the Fed increases its purchases under QE2, there will come a point where other potential purchasers of treasury bonds will pull back and leave the market. At that point, the Fed will have to continue to print more money and buy bonds or interest rates will soar. (Remeber that in 1981, interst rates hit levels just under 20% in order to stop the runaway inflation left by the Carter years.)
Some of what I am describing is bleak to say the least. It may never come to pass; however, under the generally accepted economic theories it should. Let's hope the Fed thinks better of QE2 and decides to leave things alone.
At the same time that interest rates fall, the money supply will soar. why is that? In simplest terms, the Fed gets the funds to buy these bonds by printing new currency. If you look at your US currrency, you will see that it consists of Federal Reserve Notes. These are promises to pay by the Federal Reserve Bank, so the Fed can simply print more cash and use it to buy the bonds. Of course, each time the Fed prints more money, it increases the money supply. Using QE2 to buy a trillion dollars of government bonds would increase the money supply by a massive percentage.In 2009, during the first quantitative easing, the Fed essentially doubled the money supply. An increase of another trillion dollars would raise this newly inflated money supply by more than 50%.
So what is the effect the lower interest rates that would result from QE2? first, it would probably make all long term interest rates go down. that would let corporations and state and local governments borrow at lower costs as well. This would reduce the squeeze on the state and local governments to a small extent. It would also allow businesses to borrow at a lower cost to hopefully expand and hire new people. It would also lower mortgage and car loan rates. That is the good side. On the other side, the lower long term interest rates would reduce the income of those who live off of interest income, principally elderly retired folks. These people have already seen their money market and CD returns plunge to near zero rates. QE2 would send corporate rates lower as well, further reducing the income of this segment of society. there is no reliable data that can predict the change in consumption by these folks that will result from their losing a still greater part of their incomes as interest rates decline. Then there is the issue of whether or not lower long term rates would actually stimulate the economy. Right now, corporations are sitting on a huge pile of cash and are not investing due to fears about future demand; there is no shortage of funds to borrow at current rates. Further, mortgage rates are at historic lows and housing purchases seem unaffected by the low rates. Is there any reason to believe that even lower rates will jump start the housing market?
And what is the effect of an exploding money supply? Economic theory says that if the money supply increases too fast, there will be a big increase in inflation. The old description of inflation as too much money chasing too few goods explains why. If you increase the money without increasing the goods produced, you get inflation. So why, you may ask, have we not seen inflation as a result of the first quantitative easing? the answer lies with something called the "velocity of money" or the speed with which money travels through the economy. Because of the recession, many folks took their cash and saved it at much higher rates than before the recession began. So as the Fed added money to the system, the people stopped it from moving by putting it into savings rather than spending it. In theory, however, as the economy recovers from the recession (assuming it ever does), people will take their savings and return to old consumption patterns. That will increase the velocity of money which, in turn, will lead to higher inflation.
In the 1980's, the money supply was watched carefully to see if it had increased by an extra percent or two which could cause inflation. the stock market gyrated with each report of the money supply due to fear of inflation. With QE2 in place, we could see a money supply that is three times higher than that which was in place at the start of the recession. Just imagine what kind of inflation will result. We may be seeing inflation of the sort that only appeared in 1920's Germany and certain third world countries that have had economic melt downs.
Given these outcomes, you may wonder why the Fed would undertake QE2. I have to say that I wonder the same thing myself. There may be some short term benefit for the economy to the lower interest rates, but the long term dangers are enormous. Of course, there is one long term result that may be the Fed's goal in all of this. QE2 allows the government ot monetize the federal debt. In other words, instead of paying back the debt by taxing folks to raise the money, the government will merely print up some additional money and sent it out to the bond holders. this will take the pressure off the federal government for a year or so with regard to the debt. It will, however, make the holders of US debt more than a little nervous. Imagine the Central Bank in China that holds a trillion dollars or so of US bonds. Would that bank want to keep holding those bonds and even buy more if it suspected that the dollar would soon collapse due to increased US inflation? The answer is no. So That means that as the Fed increases its purchases under QE2, there will come a point where other potential purchasers of treasury bonds will pull back and leave the market. At that point, the Fed will have to continue to print more money and buy bonds or interest rates will soar. (Remeber that in 1981, interst rates hit levels just under 20% in order to stop the runaway inflation left by the Carter years.)
Some of what I am describing is bleak to say the least. It may never come to pass; however, under the generally accepted economic theories it should. Let's hope the Fed thinks better of QE2 and decides to leave things alone.
The coming Avalanche -- the latest
I have been watching the Real Clear Politics polling data and rankings for the House as an indicator of where the election is going. As of today, RCP now has 178 seats rated as safe, likely or leaning Democrat, and 214 seats rated as safe, likely or leaning Republican. Two months ago, the parties were tied at approximately 201 each. There are also another 43 seats rated as toss ups. Of those toss up seats, 41 are currently held by a Democrat. I keep hearing that the Democrats are closing the gap, but there seems to be no empirical data to support this claim. I think it is just wishful thinking by the Dems. Today, Dick Morris is out with a statement claiming that there are now over 100 Democrat seats in play. Just imagine if 40% of all the Democrats in the House get bounced out by the voters. It is about time!
The Chamber of Commerce -- A New York Times Expose!
In a strange coincidence, the the New York Times is out this morning with an article detailing some of the larger contributions that have been made by corporations to the US Chamber of Commerce. Then, the Times explains how these secret contributions have been used to fight against some of the more job-killing attacks on business by Obama and the Obamacrats. Obviously, the Times is pushing this agenda in synch with the obamacrat campaign theme about evil foreign money coming into the US through the Chamber of Commerce to fight the Democrats. Even the Times has to point out that the money is not coming from abroad. As they put it, there are plenty of domestic corporate sources that want to fight the Obama agenda. So th big news that merits a banner headline above the fold on the front page is that American corporations are trying to fight back against an Obama agenda that has struck anti-business blow after blow against the US economy. Imagine that! US companies do not want to stand by while Obama and his party destroy the ability of US companies to compete in world markets. They want to avoid needless regulations that have nothing to do with helping Americans and everything to do with advancing the Democrats progressive social agenda. Maybe someone should point out to the Times that corporations are also guaranteed free speech according to the Constitution as interpreted by the Warren Court, the Times' favorite epoch of Supreme Court decisions.
For a long time, the Democrats had their union allies who supplied enormous sums of money and manpower to push the Democrats' and their attacks on the GOP. This election is the first cycle where Republicans have been able to respond in kind to those attacks, and the Obamacrats are going crazy. They lost their one-sided weapon, and, to make matters worse, the Democrats' allies are so demoralized this time that they are not performing up to their usual levels. Too bad!
For a long time, the Democrats had their union allies who supplied enormous sums of money and manpower to push the Democrats' and their attacks on the GOP. This election is the first cycle where Republicans have been able to respond in kind to those attacks, and the Obamacrats are going crazy. They lost their one-sided weapon, and, to make matters worse, the Democrats' allies are so demoralized this time that they are not performing up to their usual levels. Too bad!
Thursday, October 21, 2010
Harry Reid should be retired
Tonight the headline on Drudge is a link to a video excerpt of Harry Reid saying that but for him, we would be in a world wide depression. Reid made the remarks on "The Ed Show", a little known program on MSNBC. My guess is that Reid thought that no one other than the few leftists who watch MSNBC would hear his nonsense. Apparently, Harry is now so old that he has fogotten about videotape. Surely, he did not think that the public would accept his absurd claim to have saved the world. After all, we have seen him in action. This is the man who "saved" the Iraq war by declaring that the USA had lost. This is the man who saved the Iraq surge by announcing that it was a failed strategy that would never work and would only cost lives and money for no reason. This is the man who beat back the challenge from the Tea Party by pronouncing the members of that group to be "evil mongers" and "tea baggers". This is the man who echoed the Obama lie that Obamacare would save money for the USA while at the same time he arranged legislative ploys so that the true costs of the bill could be hidden. Enough said. The truth is that Harry Reid is a scoundrel who enriched himself while in office; indeed, he has four sons and at one point all four of them were lobbyists who hired themselves out to the highest bidder due to their ability to get things done in Washington. On has to assume that harry had a big part in helping the sons get things "accomplished".
The time has come for Reid to be "retired" by the voters of Nevada. He is a national disgrace.
The time has come for Reid to be "retired" by the voters of Nevada. He is a national disgrace.
Vivian Schiller -- Keep your big mouth shut!
Vivian Schiller is the CEO of NPR. Today after firing Juan Williams, Schiller told the Atlanta Press Club in a speech that Juan should have only expressed his views to his psychiatrist. What a nasty low life she is! It wasn't enough to fire williams? Now she has to say that he is mentally ill? Schiller has since offered her "sincere" apology to Williams. Isn't it funny that Williams gets fired for offering true and non-incendiary comments on FNC while Schiller is allowed to "apologize" for nasty and defamatory public remarks in another public forum.
Congress needs to cut off funding for NPR. Schiller has the right to say what she wants. she does not have the right to do that at public expense. NPR has got to go!
Congress needs to cut off funding for NPR. Schiller has the right to say what she wants. she does not have the right to do that at public expense. NPR has got to go!
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