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Thursday, February 28, 2013

Obama is Actually Trying to Hurt the Country if he Does Not get his Way

In a startling admission this afternoon, the White House released a statement in which it said that president Obama would veto any bill passed that would allow him to move the cuts of sequestration around to limit any damage that the cuts might do.  Such a bill has been proposed by the Republicans in the senate.  That bill was unlikely to pass in any event through the Democrat controlled senate, but we need to look at what Obama has just said.

1)  For the last three weeks, Obama has told us all that sequestration will be a national disaster.  Remember lines at the airports will be long, families will starve, teachers will be fired, police will be off the streets, etc.  The litany of disasters is one that you must have heard from Obama by now.

2)  Obama claims that he cannot change the impending cuts.  According to Obama, these cuts will hit the critical and the less important government functions alike.  This is actually not really true; Obama does have some discretion to move the cuts to where they would do the least harm, but Obama denies this.

3)  In order to make clear that Obama can make sure that the cuts hit federal activities that are not that important, the GOP in the Senate has proposed a plan that expressly provides that the president is authorized to shift the cuts.  The total would stay the same, but the impact would be greatly lessened.  This is the bill that Obama now has threatened to veto.

4)  Think about this.  Is it more important for America to send $1.3 billion of arms to the Moslem Brotherhood in Egypt or to use that money to provide food and shelter to the poor?  Obama is now choosing the Moslem Brotherhood over America's poor.  Is it more important to keep research grants flowing to social scientists looking into the sex lives of coeds at Syracuse University or to keep police on the streets to protect innocent civilians from criminals.  Obama is now choosing to pay those researchers rather than to protect innocent civilians.  Is it more important to keep air traffic flowing across the USA or to prevent any delay in the construction of a high speed rail line to serve some sparsely populated counties in California?  Obama is now choosing to have chaos at the airports.  Is it more important to send aircraft carriers to the Middle East to support our troops in Afghanistan and to keep those troops safe or to fund yet another so called green energy initiative run by one of Obama's big contributors.  Obama is now choosing to funnel money to his millionaire and billionaire supporters rather than to protect the brave American men and women in harm's way.

The truth is that Obama is intentionally choosing to hurt this country since he did not get his way on the sequestration.  Congress has not raised taxes as Obama wanted.  So now, like a spoiled child, Obama is throwing a temper tantrum.  The problem here, however, is that Obama is not a two year old.  The man is president of the United States of America.  He has to start acting like a president.



What a Difference an O makes

J. Toobin is a "legal analyst" for CNN.  J. Tobin writes for Commentary.  Both have columns today discussing the Supreme Court's consideration of section 5 of the Voting Rights Act.  It is as if they saw different arguments.

According to Toobin, the argument turns on the desire of the Chief Justice to do away with all the legal weapons that won the civil rights movement.  According to Tobin, the issue is whether the political elites will still be able to protect their turf using outmoded and improper arguments that arise from the Voting Rights Act.

Perhaps the strongest statement in either piece is this from Tobin:

There is no evidence that anyone in [Alabama] is trying to reinstate Jim Crow laws or prevent African Americans or other minorities from exercising their constitutionally protected right to cast a ballot. Nor is there any evidence that this is true anywhere else in the states and counties that remain under direct federal supervision as a result of the 1965 law. The entitlement in question is rather the ability of the Justice Department to act as a national elections commission in certain areas that were once strongholds of racial hatred, even though the country has changed markedly in the last half century. ...[T]he focus should be on who benefits from the continuation of Section Five of the Act. The answer is: a class of political elites that benefit from the creation of racial majority districts.

Toobin has no answer for this.  The reason is that there is no answer for this.  There is no proof of any sort that the states and counties covered by Section 5 of the Voting Rights Act are discriminating in any way against minorities.  Nor is there proof of any attempt to do so.  That means that absent such proof, Congress has no reason to differentiate between those states which are covered and those which are not.  Simply put, that means the law is unconstitutional.

Now before you tell me that when the law was first passed there was rampant racism in these states, you need to bring your facts up to date.  What was done fifty years ago by other people does not provide the basis for Congress to limit the rights of other folks today.  If you doubt this, consider whether or not Congress could pass a law that required all Americans with a grandparent born in Germany to register with the FBI and undergo background checks.  After all, a mere 70 years ago, those grandparents may well have been enemy aliens fighting against the USA.  The point here is that Congress could not do this.  Likewise, Congress cannot act now on the basis of 50 year old racism.

The sooner that folks like Toobin realize that this discussion is not about bringing back racism but rather about treating all states equally, the quicker section 5 of the Voting Rights Act will get the death it so richly deserves.

Remember, nothing before the Supreme Court will allow any state to pass any statute or rule that would discriminate on the basis of race.  That requirement remains untouched.  All that will be eliminated is the ability of the Justice Department to meddle in the affairs of some, but not all, of the states.



Woodward's Regrets

By now, you probably know that Bob Woodward was threatened by a senior White House staffer due to Woodward's recounting of the true facts about the birth of the sequestration plan.  President Obama and the Obamacrats have been blaming Republicans for the sequester and Woodward has reported that this is not true.  Indeed, Woodward has provided a detailed factual report which makes clear that Obama and the Obamacrats came up with the idea for a sequester, they also determined that sequestration would only cut spending and not raise taxes, and they also refused to modify that plan in any way that the Republicans wanted.  For telling the truth (and implicitly calling Obama a liar), Woodward was told he would "regret" it.

It has been very interesting to watch this whole mess unfold.  First, we heard that Woodward was not really threatened; it was just a poor choice of words.  Of course, then we learned from Lanny Davis, a Democrat from the Clinton White House who now writes a column, that his paper was threatened by the same person who threatened Woodward.  The paper was told that if it continued to carry Davis' column, the credentials of its White House reporters would be lifted.  So much for the "this was no threat" meme.

Second, we can see the Obama machine starting up the effort to make Woodward regret telling the truth.  Probably the most prominent attack came from perpetual Obama campaign advisor David Plouffe who likened Woodward to an aging former major league star who could no longer compete in the big leagues.  Woodward is over the hill, you see.  But Plouffe the bully is not alone.  All of the usual suspects have been coming out in support of the White House and against Woodward.  Woodward is now a right wing hack.  Woodward is a liar.  Woodward is senile.  The attacks are getting more vicious, and they are not abating.

Third, it will be interesting to see how the organs of the mainstream media like the TV networks and the big press outlets react.  No, I am not talking about so called networks like MSNBC; I mean CBS, ABC and NBC.  What will the New York Times say on its pages?  So far, CBS carried segments explaining that Woodward was correct in saying that the sequester was Obama's idea but the Woodward was misguided in saying that the deal was not to include tax increases.  CBS essentially ignored the threats made to Woodward.  ABC, on the other hand, explained the threats and reporter Rick Klein said that this would not "end well" for the White House.  We will have to see if the story has legs.  Will we still be hearing about it in two days?  If so, this will have proven to be a debacle for the Obama White House.  On the other hand, if the story fades away now, its impact will be small for now.

One thing is certain, however; the next time that the White House decides to take on a reporter, it will not get any benefit of the doubt even from the Obama loving press.  One time is an aberration; two times is a coincidence; and three times is a pattern.

The truth is that Obama ought to call Woodward and apologize, but hey that's just what I think.


All's Right With the World

The Commerce Department announced this morning that the Gross Domestic Product of the USA grew at an annualized rate of 0.1% in the fourth quarter of 2012.  This is a revision from the earlier report that said the economy contracted at the rate of -0.1%.  There will be two further revisions to this number, but it is unlikely that these later revisions will move the needle much.  We now have conclusive evidence that the much vaunted "recovery" is actually total stagnation of the economy.

Remember, this stagnant economy came as the Federal Reserve was pumping funds into the economy at a rate of one trillion dollars per year through QE3.  It also came even though the social security taxes, medicare taxes, income taxes and a whole host of Obamacare taxes were either lower or not even in effect yet.  These tax changes are estimated to reduce the rate of growth by at least 1% (which would change the 0.1% rate to a decline of 0.9%, in other words a recession).  On top of that we also have the dreaded sequester that will kick in and may reduce growth by as much as another half of one percent.  All of this means that we may soon be seeing a return to recession in America.

And with the economy falling off a cliff, what is president Obama doing to rev up the engine of growth?  The answer is clear:  Obama wants to raise taxes further.  To put it mildly, Obama's position is disgusting.  In the Middle Ages, physicians used to attach leeches to patients to "bleed" them.  These doctors thought that removing some of the diseased fluids from the body would help the healing process.  The use of bleeding was totally counterproductive, but at least the doctors thought that they were helping and they meant well.  Today, there are no economists who think that raising taxes will help spur economic growth.  Indeed, Obama himself made the point repeatedly in 2010 that one cannot raise taxes when the economy is shaky without doing great harm.  So today, Obama wants to use the medicine of higher taxes, but his goal is not to help spur growth.  Obama cannot and does not believe that his tax plans will help the economy and the American people.  One has to conclude that Obama does not even mean well.  The only other choice is that Obama is psychotic.



A Moment of Reflection

In the old movie "A Night To Remember" which was about the sinking of the Titanic, the band on the deck of the stricken liner played "Nearer My God To Thee" as the few lifeboats were loaded and the ship slipped ever lower into the water.  After that came the total disaster.  I am reminded of that image because today is February 28, 2013, the last day of normal operations for the federal government before March 1, 2013, a date which shall live in infamy.  (My apologies to Franklin Roosevelt.)  Tomorrow, the dreaded Sequester goes into effect.  We all know that Sequestration is the start of the End of Days; president Obama has told us so.  About one-third of all federal employees are going to be furloughed.  Children and their families will starve.  Millions will be made homeless.  Criminals will go wild since nearly every policeman in the country will also lost his job.  Fires will no doubt spread throughout cities as the fire departments close down.  Our national security aparatus will fall apart.  Aircraft carriers will remain in port since it will be too expensive to set sail.  No doubt, terror attacks will once again hit America as the FBI, CIA and military all sit in their offices to save money.  Every federal employee (other than those in the White House) will suffer.  Our economy may fall into a depression.  Oh, and some national parks may have to curtail their hours.

I suggest that at 4:00 EST this afternoon, we hold a minute of silence to commemorate the end of these halcyon days of joy which will be ending due to the evils of sequestration.  It just is not right that the evil Republicans insist on cutting spending this year by a little over 1%.  It does not matter that the whole plan was dreamed up by Obama.  It does not matter that he did nothing for the last 18 months to stop it.  It does not matter that last fall he assured the country that sequestration would never happen.  Indeed, it does not matter that last fall Obama said he would veto any attempt to avoid sequestration.  It is all the fault of the Republicans; everyone now knows that.

After the end of the minute of silence we are going to have all of America sing "Nearer My God to Thee" as the ship of state sinks slowly into the Atlantic.  If you want the words, I suggest that you go to  



Wednesday, February 27, 2013

Chuck Chuck

I waited to write about the senate approval of Chuck Hagel as secretary of defense.  I wanted not to say anything in annoyance or anger; the facts ought to speak for themselves.  So here are the facts:

1)  Hagel had possibly the worst confirmation hearing of any nominee for high office in my lifetime.  He was clearly unable to speak to most of the basic issues that affect the Defense Department.  Even when he spoke about issues, much of what he said was either incoherent or laughable.  There is no need to analyze the hearing again. 

2)  Hagel clearly lied on the disclosure materials that he put together to give to the senate.  The lies were not blatant, but they were lies of omission.  Hagel "forgot" to put down a whole series of speeches and other public statements that he had made in the years after he left the senate.  Not surprisingly, nearly every one of the "forgotten" speeches and statements were made to groups that were controversial.

3)  Hagel refused to say if he had received funding for his activities from any foreign sources in the last four years.  For the person who is to be in charge of national security, this is extremely strange.

None of these items pertain to Hagel's views on policy.  Many of those views are disgusting, but president Obama ought to be able to have a secretary of defense who follows Obama's policy prescriptions.  I will just assume that Hagel fits that requirement.  The problem is that Hagel is an incompetent ignoramus who seems unable to tell the truth, even under oath.  On top of that, Hagel may have entanglements with foreign governments.  In short, the senate ought to have voted against his confirmation.



So Who Loses From the Sequester?

Over the last three weeks, the main stream media has been filled with article after article that explains how the public will blame Republicans more than president Obama and his party for sequestration.  It has almost gotten to the point where this claim is more like a mantra that the msm reporters are chanting than just a prediction.  And it is not just the main stream media that engages in this.  Rush Limbaugh has been expounding at length that Obama is not perceived by the public as responsible for the way things are.  According to Limbaugh, the permanent Obama campaign works to show Obama as fighting to stop the bad things that are about to happen.  In that way, Obama can shift the responsibility to the GOP for sequestration no matter what the actual facts are.

Well we seem to be getting a clear indication that this entire analysis is wrong and the public is not falling for the Obama line (lie?) regarding sequestration.  Probably the best evidence comes in the form of Obama's job approval numbers.  For much of Obama's first term, more of the public disapproved of his job performance than approved.  After the November election, however, Obama moved public opinion to a reasonably favorable place.  Millions of folks who were thrilled that the election was finally over decided to give Obama the benefit of the doubt once again.  The polling put Obama's approval numbers went up to about 57% and disapproval declined to about 41% according to the Rasmussen poll.  (I use the Rasmussen poll because it is taken daily and it always uses the same methodology.)  The latest poll released today by Rasmussen shows the approval/disapproval numbers at 50 to 48%.  This is Obama's worst showing since the election.  Over the last two weeks when the sequestration argument has come to the fore, there has been a steady shift away from approval of Obama to disapproval of his job performance.

Now before I get the emails asking me about what the polls show regarding the approval of Congress, let me quickly add that there really are no such daily polls and that they would not be meaningful anyway.  Remember, Congress consists of a Democrat senate and a Republican house.  One cannot tell if disapproval is due to the senate or the house or both. 

The main point here is that Obama may come to rue the day that he was so unreasonable with regard to the sequester.  Too many people understand that sequestration does not even cut spending; it only slows the rate of growth.  Americans actually understand that spending has to be controlled and they can now clearly see that Obama lied when he said that he wanted to do just that.



No ICE in the Winter

The Department of Homeland Security is in the process of releasing about 10,000 of the 34,000 illegal aliens being held by the federal government pending completion of their deportation proceedings.  According to DHS, the reason for releasing 30% of all of the illegal aliens is that sequestration will result in the spending at DHS being held to about the same as last year's amount.  Even more surprising, DHS has already released thousands of these illegals even though sequestration has not yet begun.

This move needs to be put into perspective.  Across the USA, there are detention centers for illegal aliens where these folks have been kept.  As a matter of federal policy, the illegals who are detained in these centers are considered dangerous.  For the most part, this means that those detained have committed criminal acts wholly unrelated to their immigration status.  While not all of these people have been convicted of the crime, they have been accused of committing crimes.  The non-criminal element who get rounded up by ICE are usually processed through the system.  What this means is that the federal government is releasing 10,000 people who are mostly suspected or actual criminals onto the streets of America because DHS will not get a budget increase this year.  Nothing will be cut, but the increase will just not be large.  Thirty percent of the bad guys being held by ICE are to be set free on the streets because the increase in the budget is just too small.

This is an outrage.  I know that "outrage" is one of those overworked words when applied to government these days.  This time, however, "outrage" is probably too tame a word for what is happening.  When the first of the criminals released murders someone, will we be told that the crime was the result of sequestration?  Or will we be told the truth, that the death was the result of a political stunt pulled by the Obamacrats to make it look like sequestration was a disaster.  It seems that the Obamacrats are willing to see Americans die in order to make a political point.

The truth is that DHS does not have to release these folks.  It has many other places that it can cut.  Indeed, if it were to just cut costs across the board, then maybe a few hundred detainees who are not accused of criminal activity could have been chosen for release.  But that is not what happened.  Instead the number released is 30% of the total held.

It is worth noting that DHS has not closed any of the detention centers, even temporarily.  If it truly wanted to save money, it could close one of these centers and lay off the staff.  There would be no labor costs.  There would be tremendously reduced costs for utilities.  There would be large savings compared to the small savings achieved by releasing a criminal back on the streets.

President Obama, Secretary Napolitano and all the others involved in this travesty deserve to be condemned for their actions.  At some point, government officials need to do what is good for America rather than putting the country at risk to win some small political victory.  It is a lesson that these folks just have not learned.



So Why is it Okay For Cablevision?

According to news reports, cable TV operator Cablevision has filed suit in federal court against Viacom because Viacom will only sell access to the channels that it owns in packages rather than individually.  The Cablevision complain is not available to the public yet, but according to the press release put out by Cablevision, Viacom will only allow cable tv providers like Cablevision to carry popular channels like MTV and Nickelodeon if those companies also carry unpopular channels like Logo and Nick Jr.  In fact, Cablevision states that Viacom links 14 weak and unpopular channels to eight strong and popular ones in order to force customers to take unwanted channels.  Cablevision says that this conduct is a violation of the anti-trust laws.

So here is my question:  why does Cablevision think this conduct is a criminal violation of the anti-trust laws when Viacom does it, but perfectly proper when Cablevision does the same thing?  For those of you who are not Cablevision customers, you should know that Cablevision only sells most channels in packages.  If you want two particular channels, you may need to pay for 60 others that you do not want but which are part of the package.  I know that in my house we have a great many channels that no one has ever watched.  Let me be clear:  I do not mean that we rarely watch these channels; rather, no one has EVER watched them.   If Cablevision is correct, then this conduct is, logically, a criminal violation of the anti-trust laws.  Now that Cablevision has recognized the impropriety of this conduct, will it start to sell channels to customers a la carte?  It certainly ought to do so.  Otherwise, some enterprising attorney will soon bring a class action against Cablevision on the basis of Cablevision's own admissions made in the Viacom lawsuit.


Not Everything Needs State Action

The Greenwich Time has a major story today about Connecticut's "deadliest road for pedestrians" and proposals for new state policies and investments to make the road safer.  Since the road in question passes right through my town, the story caught my attention.  It turns out that the so called deadliest road is US Route 1 which crosses the entire state from east to west.  It won the title of "deadliest" because in a decade, there were six pedestrian fatalities on the road across the state; that is a rate of less than one per year.

Now I do not minimize the tragedy of these people being killed, but I still had to laugh when I saw that the paper was supporting a proposal to build all sorts of bike lanes, sidewalks and other "improvements" to make the road safer.  Indeed, at least two of the six folks killed during the decade in question were hit by cars when they tried to cross the street away from nearby traffic lights and cross walks.  Most of the other four were killed in areas with sidewalks.  Since the details on all of the accidents were not given, I do not know if any of the fatalities involved bicycles.  In other words, the big program of state action that the paper is supporting to rememdy the "problem" seems to have nothing to do with the reason why the six people died.

It is no wonder that local newspapers are dying.


Big News if True

The second in command of Hezbollah was reported killed in Syria yesterday.  Here is the news report taken from the Jerusalem Post:

Hezbollah's deputy chief was killed Tuesday when Syrian rebels bombed a convoy consisting of high-ranking Syrian government officers near the Lebanon border, news portal Now Lebanon quoted the Free Syria Army as saying on Wednesday.  “It has been confirmed... that Hezbollah’s number two man died after [receiving] a serious injury,” the Free Syria Army posted on its Twitter account.

Since even the Jerusalem Post mentions later in the article that there is a dispute as to whether Naim Qassam was just injured or if he was killed, one cannot be sure exactly what happened.  Nevertheless, either way, this is important.  Currently, Nasrallah, the leader of Hezbollah is undergoing treatment for an "illness" in Iran.  It is rumored that Nasrallah has terminal cancer and not long to live.  If both Nasrallah and Qassam die, it will leave a major vacuum at the top of the terror group.


Tuesday, February 26, 2013

Voting Wrongs

CNN today is carrying a column by the head of the NAACP and the co-director of a "next generation civil rights organization" (whatever that is).  These two luminaries argue at length that the Supreme Court should not strike down as unconstitutional even a comma in section 5 of the Voting Rights Act.  Here is the heart of what they have to say:

The case comes on the heels of a federal election last fall in which our nation witnessed the greatest assault on voting rights in more than a half century. Drastic cuts to early voting hours, restrictive photo ID laws, tens of thousands of registered voters being dropped from poll books due to illegitimate purges were only a few of the tactics used to keep people from voting.  Desiline Victor, a 102-year-old Miami resident who was invited to join first lady Michelle Obama at the recent State of the Union address, stood in line for more than three hours to cast a ballot. Sadly, thousands of voters had to endure waiting times up to eight hours, prompting President Barack Obama to call for the nation to "fix it."

So let's look at this terrible "assault" on voting rights.

1)  Early voting hours were cut in some states.  Oh, the horror!  Let's be clear what this means.  On election day, all of the polls were open as usual.  Anyone who wanted to vote by absentee ballot could do so as usual.  In some states, though, one can vote for a few weeks before election day at a few selected locations.  This gives people the added convenience of being able to vote on a different day than election day.  In a few of these states, the hours when the special locations were open were changed; hours or days were cut to save money.  These cuts reduced early voting in some place from two weeks to only ten days.  But remember, many states do not have early voting.  For example, my state of Connecticut does not allow anyone to vote early.  So, when a few states limit the EXTRA voting opportunities but in no way change regular voting, it is hardly an assault on voting rights.  Anyone of any race, creed, religion or sex could still vote on election day without any sort of restriction.

2)  The so called restrictive photo ID laws have already been reviewed and approved by the Supreme Court.  The authors may not like photo ID laws, but again, such laws which are passed to prevent fraud in voting, are hardly an assault on voting rights.  And before you decide that there is no voting fraud, just remember that within the last two weeks news came of Democrat poll workers in Ohio who voted multiple times in November.

3)  Voters dropped from the rolls do to purges are hardly "illegitimate".  The authors just ignore the fact that people move, die or go off to college.  Unless the voter rolls are reviewed to purge names of folks who are no longer voting, there will be a clear temptation for fraud.  Here is an example:  my daughter last voted at my address in Connecticut ten years ago.  That's right, she has not lived here for a decade.  Nevertheless, each time I go to vote, her name appears on the rolls right below mine.  I have told the poll watchers that she is no long living in Connecticut; it does not matter.  Were her name removed from the voting rolls, it would hardly be an assault on voting rights.

4)  Then we have the woman who waited three hour to vote and the others who supposedly waited eight hours in line to vote.  This is total nonsense.  These are not people who came to vote on election day.  On that day, the wait in most places was less than ten minutes.  Even at the worst locations, almost no one waited an hour, and there is absolutely no correlation between the areas covered by Section 5 of the Voting Rights Act and the places which had waits for voting.  Keep in mind that the long waits that the authors speak of came when people tried to vote early on the first day when such voting was allowed.  If there was one polling place for early voting in a county, it is no wonder that there were times when that polling place got crowded.  Again, this is hardly an assault on voting rights.

So essentially everything that the CNN article says is phony, but that is not the key point.  Rather, the key here is that none, absolutely none of the items raised by these folks at CNN has anything in particular to do with the few states that are covered by the section 5 of the Voting Rights Act.  If Pennsylvania implements a photo ID system for voting or Ohio restricts early voting to only 14 days rather than 16 as previously, it has nothing to do with voting in Alabama.  Even the folks at CNN cannot think that problems in one state allow the federal government to place restrictions on another state.



Pushing on a String

This morning the chairman of the Federal Reserve Bank, Ben Bernanke told Congress that the benefits of quantitative easing were clear.  He also told Congress that it needed to stop deficit spending while avoiding the upcoming spending cuts of sequestration.  It was quite a bit of testimony from a man who is supposed to understand economics.  Indeed, it sounded more like an advertisement for institutional hubris than a statement of economic reality.

First of all, let's talk about QE3, QE4 or whatever number we are at now.  Currently, the Fed is buying treasury and agency bonds at a rate of just over one trillion dollars per year.  For those who do not quite understand the operation of QE3, let me explain.  By law, the Federal Reserve is prohibited from printing money to buy bonds, notes or bills from the Treasury.  When the law was passed, Congress wanted to make sure that America would never just print money in order to pay its bills.  QE3 is a clever way around that restriction.  The Fed does not buy bonds from the Treasury.  Instead, other buyers bid for the Treasury securities, then the Fed goes into the open market and uses newly printed money to buy the bonds from those who purchased them in the treasury auctions.  The current expectation is that the federal government will run a deficit of just under one trillion dollars this year.  That means that the Federal Reserve is going to print money to cover slightly more than the annual deficit.  In other words, America is not actually borrowing money from anyone; it is printing new money to cover its debts.

At some point, all of this newly created money will cause chaos.  All that is required for this chaos to appear is for all the excess money to start circulating.  Right now, nearly all of the excess money is stashed away in accounts held by major banks.  If the economy actually starts to pick up or if the banks begin to loan the funds to private borrowers, a flood of cash will hit the American economy.  This is the classic recipe for high inflation.

Bernanke actually told Congress this morning that "Inflation is currently subdued, and inflation expectations appear well anchored.”   Translating this into English, benificent Ben is telling us that the Fed is watching inflation levels and we have nothing to worry about at the moment.  Here's where the hubris kicks in.  Bernanke actually believes that the Fed will be able to do something that no central bank in history has ever accomplished.  Bernanke wants America to believe that once inflation starts to grow rapidly because of all the excess cash, the Fed will be able to step in and reduce the money supply to stamp out inflation.  The way the Fed would reduce the money supply is to start to sell all those Treasury bonds that it has been buying. 

Let's do a thought exercise.  Let's imagine that it is now March of 2014 and that inflation is now showing up in the data at an annual rate of 4.5% or so.  This is not a disasterous level of inflation by itself, but it is a clear indicator to the Fed that much higher rates are coming, so under the Bernanke version of reality, the Fed steps in to reduce the money supply.  What does that mean?  Here are just a few of the effects:

1)  The Fed stops buying bonds in the market and begins selling them instead.  With the biggest buyer of bonds becoming the biggest seller, the prices of the bonds will go down dramatically.  That means that interest rates zoom up.  Just think of it:  instead of a ten year Treasury bond paying around 2% it would jump up to 4, 5 or 6%.  Remember, these are not really high rates by historical standards, but they would be killers nevertheless.  If the shift in rates results in the government just paying one percent higher overall on the federal debt, that means that interest costs for Washington rise by just under $200 billion.  It would put another hole in the budget.

2)  Higher interest rates would not just hit the federal budget.  All sorts of financial institutions and pension plans that hold federal debt would see the value of those bonds decline.  Further, since most other sorts of debt like corporate and municipal bonds move in synch with the treasuries, the value of these instruments would also decline.  It is hard to put a number on the decline in value, but it could easily top two trillion dollars. 

3)  Companies that need to borrow funds to cover expansion or operating costs would find loans much more expensive.  That would reduce economic activity.

4)  Higher interest rates would give a boost to inflation as the costs of these rates swirled through the economy.

5) Even the Federal Reserve would suffer a big loss.  Just imagine how much the value of the bonds held by the Fed would decline.

6)  The economy would be hit with major shots that almost inevitably would lead to a recession or a depression.  Unwinding the QE3 program and those that came beforehand will mean suffering for millions of Americans as we go through another severe downturn.

In the fantasy world that Bernanke believes to exist, the policy makers at the Fed are all knowing and all powerful.  They are able to know exactly what is happening and to take measures that are slight enough to permit the economy to stop inflation without all the bad side effects.  Indeed, Bernanke is like all those Wall Street and Washington know it alls who were sure in 2007 and 2008 that they could handle any problem resulting from the mortgage crisis.  Remember where that got us.

It concerns me that in writing this, I sound like a conspiracy theorist.  Here is the doom that lies ahead!  The sad thing this time, however, is that I am not describing a conspiracy.  This is reality.  I hope I am wrong.


Focus is Everything

Let me ask you this.  Which of these two items is more important:

a)  the murder of 141 people, more than half of whom are children; or

b)  the possibility that lines may get a bit longer at airport security?

If you voted for the lines at the airports, then you may have a future in the main stream media.  Just think, how many times in the last week have you heard that budget cuts could lead to those longer lines.  Then think about how many times you heard that the Assad forces in Syria fired missiles into residential areas of Aleppo and killed 141 innocent civilians over half of whom were children (and no rebels by the way).

I understand that the media is going to focus on American issues.  That makes sense.  After all, the audience is American and would care about issues that affect them directly.  Even so, however, one would think that there would be some coverage of the war crimes being committed in Syria.  How many people marched to protest water boarding, and how much coverage of that took place?  No one died, just some people got wet on a few occassions.  But those Syrians in Aleppo are dead; that won't change when they dry off.

The sad truth is that it seems to me that neither the media nor president Obama will ever pay attention to Syria unless and until they find a way to blame the fighting on the Republicans.



Monday, February 25, 2013

Selling Access to Obama

In a truly distressing bit of news, we learned today that president Obama's permanent campaign is selling access to Obama in exchange for a $500,000 contribution.  Anyone who gives half a million dollars gets to attend a meeting every three months with the president.  I have not done the research to determine this, but it seems to me that this practice is illegal.  No public official can sell access to him or herself.  But, even if the way this is structured keeps it on the right side of the law, it is a truly tawdry practice.  The country ought to be ashamed that we have a president who just sells out to the highest bidder.  For all of his tax the rich statements, Obama always seems to have something good for those rich folks who give him campaign cash.  Just look at how well all those green energy cronies did with the billions of federal funds that Obama threw at their projects.


Do Liberals Ever Consider the Actual Facts?

Sometimes I still get amazed by the latest attempts by the left to ignore the facts and to use their ideology to explain everything.  Today brought another example.  I came across an article at Breitbart about the upcoming panel discussion at the Center for American Progress on "Climate Change and the Arab Spring."  Supposedly, the unrest in the Middle East over the last two years is the result of climate change,  CLIMATE CHANGE!!!!  No, I am not kidding.  The unrest was due to CLIMATE CHANGE!!!

Here's what they have to say about Syria:  for a number of decades the Assad regime “had ignored water conservation issues and agriculture in general.”  As a result, "When the drought destroyed farming communities, it sent new migrants to the cities – most of which were not from the ruling Alawite minority. This placed great strain on urban populations, and exacerbated ethnic and religious strife. This strain is evident in the ongoing conflict within Syria."

This can only be described as pure garbage.  If the authors of the study in question had bothered to look at the Syrian population, they would have discovered that only 12% of the Syrians are Alawaites; 76% are Sunnis.  Whenever there is movement of people in Syria, most of them are not Alawaites.  Further, the conflict in Syria did not have an ethnic background; it began because of the attempt by the Assad regime to use terror against civilians to prevent any opposition.  Specifically, almost two years ago, there were some protest rallies in Syria in which the marchers sought a relaxation of the martial law restrictions under which Syrians had lived for decades.  To stop the marches, Assad brought in army snipers to fire randomly into the crowds.  That is lunacy, not ethnic unrest caused by warm temperatures.  The use of snipers caused anger which led to more demonstrations against Assad.  In turn, the snipers were given machine guns to kill larger numbers of marchers.  It was the slaughter of innocent Syrians that then caused the civil war, not global warming.  At that point, the Alawaites did side predominantly with Assad.  That is not surprising since the Alawaites have been ruling the country for nearly 50 years; the rest of the Syrians were very much second class citizens.  The Alawaites sided with Assad to protect their privileges, not because of the temperature.

Just as a note:  one of the speakers at the upcoming panel on climate change and the Arab Spring is Tom Friedman of the New York Times.  The fact that Friedman would lend his name to such a ridiculous discussion should tell you all you ever need to know about the insight that Friedman brings to all of his columns.



He Didn't Get the Memo

Over at CNN, Julian Zelizer has a piece in which he explains why Republicans have to rethink their desire to cut spending by the federal government.  According to Zelizer, in 1995 when the federal government shut down, the GOP got the blame because parks were closed and getting a passport became impossible.  Even though the public is not concerned now about the upcoming sequestration, according to Zelizer there will be nationwide upset once the terrible cuts kick in.

I think Zelizer somehow missed the memo that explains what sequestration actually is.  Spending is still going up; the only thing to be cut is the rate of increase.  Everything that the government could afford last year, it can also afford this year.

I have made this point repeatedly on this blog, but Zelizer's reference to people experiencing difficulties in obtaining a passport brought me back to the last time I went through that process.  let me describe that model of government efficiency.

My passport had four months left until expiration, so I went online to find the closest passport office.  There had been one in Stamford, Connecticut years earlier that I had used.  The State Department website told me that I could obtain my passport at the Post Office, so there was no need anymore to go all the way to a State Department facility.  That sounded great, so my wife and I got all the materials that we needed according to the list online and went to the post office in our town that was designated as the one where one could obtain a passport.  I even checked online to see if there were particular times for seeking a passport and found out that they were available only in the afternoons from 1-3 pm.  We arrived at 12:50 in order to avoid any lines and went to the window to ask where one obtained a passport (there were no signs).  After waiting for five minutes to get to the front of the line, we reached a nice elderly lady who told us that we were too early to get a passport.  We were further told that we could only obtain the passport after 1:00 pm.  She also pointed us to a corridor where there was a window that would be used for passport business.  We thanked her and went to the appointed spot.

Sure enough, at 1:00, the passport window opened for business.  The same elderly lady who had spoken to us at the other window now was at the passport window.  We were the only ones in line, and the elderly lady asked if she could help us.  I again explained that we wanted to renew our passports.  The immediate response came from her that it did not seem that we had an appointment, so she could not help.  I was somewhat surprised, but I pointed out that there was no one else there and asked whether she could just help us since we were already there.  The answer was no.  It seemed strange, but I know better than to fight in such situations.  I asked the woman if we could make an appointment.  She told us that appointments were only available by phone more than three days in advance.  I asked for the phone number and also whether there were any particular times when calls for appointments had to be made.  To my amazement, she actually gave me the number and told me when to call.  We then left.

The next day, I called to get an appointment.  I cannot tell for certain, but I think that the call was forwarded to the same woman who had helped us (or more precisely not helped us) at the post office.  She gave us an appointment for two weeks later.  When the appointed date and time came, my wife and I appeared at the post office.  We had to wait for a half hour while the passport applications of people ahead of us were handled.  Finally, we were next and the same woman appeared at the window.  The entire process took about 5 minutes to complete.  After that, we had to wait for weeks until the new passports appeared in the mail.

The point of the story is this:  the 5 minutes of processing time could easily have been handled on our first visit to the post office.  Instead, we were forces to make two trips rather than one, to wait for almost three weeks to complete the process instead of 5 minutes, and to waste more than an hour of our time in the associated run around that came with the application process. 

I don't really care what Julian Zelizer at CNN thinks.  That process could not get worse.



Menendez Again

After a few weeks when the alleged escapades of New Jersey senator Menedez with underage prostitutes were out of the headlines, they are back.  This time, the Daily Caller, the site that broke the Menendez story, has a lengthy article in which an American call girl explains her relationship with the senator.  The hooker also corroborates earlier stories about alleged Menendez sex romps in the Dominican Republic.  This is just more of the same when it comes to Menendez, so I wonder if this latest disclosure will drive him any closer to resigning.

One thing is certain, however.  We have a senator who is being accused of all sorts of sleazy and illegal conduct.  The accusations include (1) frequenting prostitues in DC, a crime; (2) frequenting underage prostitutes in the Dominican Republic, again a crime; and (3) taking gifts from a Florida man in exchange for helping that man to secure major benenfits from the government for his company, yet another crime.  We know that the FBI has been investigating these allegations.  With all this underway, one would think that the New York area media would follow the story closely.  After all, New Jersey is a big part of the metro New York market.  The local media, however, has barely mentioned this mess.  Senator Menendez who may well be a major scumbag and criminal if the allegations are true, is being allowed to go on as if nothing has happened.  I have yet to see any attempt by the local media to even question Menendea about the allegations.  Indeed, the local media have not even reported on the allegations regarding the prostitutes to any great extent.  Don't the people in New Jersey have the right to know what is going on?



What if They Created a Crisis and Nobody Cared?

It certainly seems as if reality is triumphing over hype.  For the last few weeks, rather than trying to modify the upcoming sequester so that it would focus on cutting the most useless federal spending, president Obama has been trying to build the upcoming cuts into a national disaster.  In Obama-speak, the message is clear:  "The sky is falling!"  We have been treated to litanies of terrible cuts that will starve children, throw families on the streets and generally kick all of the poor while they are down.  Sequestration, we have been told, will hollow out national defense, allow millions to sicken or even die from food poisoning, and put us all in jeopardy.  And all this will happen because federal spending will go up in 2013 by only $15 billion rather than by $100 billion.  Every cent spent last year and much more will still be spent, but the federal government, we are told, will just be unable to do any of its job.  As Henny-Penny puts it in the old children's story, "the sky is falling."

The funny part of this manufactured "crisis" is that for once, the public does not care about it in the least.  And now even the media is starting to notice.  ABC News, always a supporter of Obama causes, published a note today lamenting that Obama is facing what they call "cliff fatigue" in the current fight.  ABC thinks that the public has just had to face too many of these spending fights in Washington to pay attention this time.  The network is also nearly distraught that Obama might fail to get his way at the point in his second term when he is most likely to get action by Congress.  ABC actually expresses the fear that if the public does not wake up and support Obama on sequestration, the Republicans (horror!) might not rejoin Obama at the negotiating table in the future.

It is enjoyable to see just how clueless ABC is about the reason why the public does not care if sequestration goes into effect.  The answer is that the public understands that these are just tiny cuts to a monster federal budget.  The word that spending will still rise even after sequestration has actually made its way into the public consciousness.  Obama has been revealed as a liar.  Oh, I doubt that most people would actually call him that, but the lack of truth in his statements has shone through. 

I just wonder how many in the media will suffer medical disabilities due to the incredible upset that this result must bring them.