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Tuesday, June 30, 2015

Let's Focus On What We CAN Do

I keep listening to candidates for president make speeches.  Right now, there are something like 20 or more "major" candidates.  They talk about all sorts of things.  Just today, Chris Christie announced that he would tell America "the hard truths" (although he didn't bother to include any of those truths in his speech.)  On those occasions when she comes out of hiding, Hillary Clinton talks about things like voter suppression and women's rights.  Others like Rand Paul talk about surveillance and quasi-isolationism.  Lincoln Chaffee is talking about the need to adopt the metric system.  The truth, however, is that almost everything that has been said by nearly every candidate has been either negative criticism or some sort of lamentation.  Sometimes, the candidates rise to the level of saying that they will do something to help the American people, but they rarely go on to provide even the tiniest details of what that "something" will be.

It is clearly time for all of these candidates to change their focus.  They need to talk about the one issue which is without a doubt the most important one of all.  We need to hear from each candidate how he or she would help the American economy to get back to strong growth.

Think about what accelerating economic growth would do for the USA.  Here are just a few of the effects of strong economic growth:

1.  Strong growth would mean that there would be more jobs created for the American people.  Unemployment would be cut and so would underemployment, the situation in which a worker wants to work full time but cannot find that job.

2.  Strong growth would increase revenue for the federal government.  If the GDP grows by 6%, tax revenues grow by even more than that.  All those deficits that were hear about again and again would shrink dramatically if federal revenue were just 5% higher.  Just that change would have reduced the deficit from about 500 billion dollars in 2014 to around $300 billion.

3.  Faster growth would also raise the incomes of the America middle class.  The extra jobs created and the need for longer hours would mean higher wages for workers.  It would also mean higher profits for companies and, therefore, higher levels of investment.  That, in turn, would mean still higher growth, etc. 

4.  All those people with new jobs and higher incomes mean that spending on government assistance programs could be cut.  There's no need to pay unemployment compensation to somebody who gets a new job.  There's no need to give food stamps to a family whose income has now risen substantially.  As spending is cut, it again means that the federal deficit is further reduced.  Indeed, two or three years of strong growth could bring us to the point where the deficit is erased.

5.  Strong growth also increases the ability of the USA to defend itself.  All those fancy weapon systems cost money.  If America needs to use cruise missiles against ISIS, for example, it is better if we have the resources to replace those cruise missiles easily.

6.  Strong growth also means that America will be more respected by other countries.  Think of all those people around the world who will watch the success of the USA and want to emulate us.  Sure, some will be jealous, but the good will outweigh the bad.

These are just some of the benefits from strong economic growth.  The fact is that nothing does more to benefit America in the long run than a sustained increase in growth.

I strongly believe that a candidate that explains the need for growth, that tells Americans the good news that strong growth will bring and that sets forth a competent plan to achieve that growth will have great success in the elections.  As of now, only Marco Rubio and Carly Fiorina have managed to do this to any extent.  Scott Walker has started on this road too, but he still has a long way to go.  As for the rest of the candidates, they are just talking without having much to say.


Why Is He Bothering?

Chris Christie is getting into the presidential race today.  The only real question is when will he get out of the race.  The over/under right now says it will be the day after the New Hampshire primary.

Christie has no business running for president.  He got his initial reputation as someone who got things done.  Remember: he became governor and managed to stop some of the spending and reform some of the labor agreements in New Jersey.  He was Mr. Straight Talk.  He was direct and honest.  He knew what to do, and he got it done.  Except it wasn't true.  His tenure as governor has basically been not very successful.  In fairness, he has been a big step up from the his predecessor Corzine (who never met a dollar he couldn't tax or spend) and the even worse McGreevy who made everything into a personal drama about his sex life.  Still, being the first marginally acceptable governor in New Jersey in a while is not a basis for a presidential run.

Okay, I know that by now some of you are saying that I am being unfair.  After all, Hillary Clinton was not even a marginally acceptable Secretary of State (although she was better than John Kerry), but I don't say she should not run.  It's true.  When it comes to accomplishments, Christie has done much more than Clinton.  When it comes to honesty, Christie may not be a total straight shooter like he claims, but Hillary hasn't been honest ever.  She is about the biggest liar ever to be a candidate.  Christie does have some proposals that he is pushing as part of his campaign, while Hillary's silence on the issues is deafening.  But Christie is a Republican, not a Democrat.  He can't run on a platform that says "Hey, I'm a woman!"  Christie needs to satisfy a party that actually cares about the issues. 

So again I say, Christie should not run.


Monday, June 29, 2015

The Bankruptcy of Liberal Thought

If you have ever heard of Vox, you probably know it as a far left website that publishes "think pieces".  Supposedly, some of the brightest minds on the left write for the site.  That's why I think it's worthwhile to take a look at a piece today on Vox about how World War III is now possible.

Here's the paragraph that sets the tone for the whole piece by Max Fisher.

Europe today looks disturbingly similar to the Europe of just over 100 years ago, on the eve of World War I. It is a tangle of military commitments and defense pledges, some of them unclear and thus easier to trigger. Its leaders have given vague signals for what would and would not lead to war. Its political tensions have become military buildups. Its nations are teetering on an unstable balance of power, barely held together by a Cold War–era alliance that no longer quite applies.

That sounds pretty bad, doesn't it.  The problem, of course, is that it is just wrong.  It's not wrong as a matter of opinion; the basic facts are incorrect.

Let's start with the supposed "tangle of military commitments."  Okay, there's NATO.  That's the same NATO that has been around since just after the Second World War, except today's NATO is both weaker and less active than the alliance was during the Cold War.  That's it.  There are no other military alliances or defense pledges.  Oh, the Russians would defend the "separatists" in Ukraine, but they are actually just Russians in disguise.  That's all there is.  Indeed, almost every nation in Europe is either in NATO or is neutral.  There are no large scale military commitments other than NATO.

But what about the vague signals for what would and what would not lead to war that Fisher discusses?  Is he kidding?  The three largest European military powers other than Russia are the UK, France and Germany.  None of them has a leader that has said anything at all about what would cause a war, vague or otherwise.  Certainly, president Obama has said nothing about war or what would cause one.  So at most Fisher is talking about comments that Putin made in Moscow.

But there's "political tensions that have become military buildups", right?  Really?  Where?  There is not a single nation in Europe aside from Ukraine which is trying to defend itself from Russian invasion and Russia itself that have seen any meaningful military buildup.  Indeed, European military structures are relatively weaker today than they have even been in modern times.

Okay, but isn't there an "unstable balance of power" in Europe?  Nope.  There's NATO which encompasses nearly every nation in Europe.  There's Russia against whom the Europeans are really not trying for power equality.  The reality today is that most of Europe is in a post-military era in which the idea of some 19th century balance of power makes no sense.

The actual reality of the Vox article is that it shows just how bankrupt the deep thinkers on the left have become.  Instead of analyzing actual facts, they pretend to know something that they clearly don't.  It's not just that Fisher writes a piece that is laughable in its pretense of knowledge.  It's also that the editors at Vox prominently publish an article which is just so completely wrong.

Why would anyone bother to consider what these fools have to say?


Regulating Abortions

The Supreme Court is back at it with its latest order that puts a Texas statute regulating abortions on hold until the Court can hear and decide the case.  Oh joy!

The Texas statute does not limit abortions but rather puts minimum requirements on abortion clinics at which the procedures are carried out.  The requirements are things like having at least on doctor on the staff with admitting privileges in an area hospital.  This requirement means that should a problem arise during an abortion procedure, the patient can be sent directly to a local hospital for more treatment.  There are some other requirements regarding things like cleanliness, etc.  The people opposed to the law say that it will just force many abortion clinics to close and that will limit the right to an abortion.

Given some of the recent decisions by the Court, there is no way to know how the case will turn out.  Certainly, the state of Texas has the right to regulate the practice of medicine within its borders.  If it chooses to require certain standards for clinics, that ought not be controversial.  We will have to wait to see how it turns out.  My guess is that Texas will prevail, but with this court, you never know.


Putting It All In Perspective

Every so often, it is worth the time to try to put things in the proper perspective.  Here's a short effort to do so.

1.  Reports from Vienna say that president Obama has capitulated to the demand of Iran that dramatically limited or even prohibited future inspections of Iranian nuclear sites to make certain that Iran was not cheating and building a bomb.  Yesterday, however, at the point when this news broke, it was Gay Pride Day and there was a chance for the media to interview various people celebrating that day about same sex marriage.

2.  Reports from Syria say that ISIS is coming ever closer to the home of over half a million Druse around Jebel al Drusi near the border with Jordan.  Should ISIS take this area, there will be genocide as the ISIS fighters kill the Druze as apostates.  Meanwhile, however, the second escaped convict from New York was shot as he was recaptured yesterday.  That means that the media can give live coverage to the press conferences held at the hospital where he is being treated.

3.  The Chinese stock markets are collapsing at an alarming rate.  They have lost over 20% of their value in the last two weeks.  If this is an indication of a major contraction in the Chinese economy, there will be worldwide repercussions (none of them good.)  Meanwhile, however, NBC announced that it will no longer carry the Miss Universe Pageant because of some remarks made by Donald Trump.  That decision will have no effect whatsoever on the world or America economy, but hey, it's the Donald.

4.  Terrorists attacked innocent civilians in Tunisia, France and elsewhere around the world in the last few days.  There is a warning that we may see terror attacks in the USA in the next week as well.  Meanwhile, some blurry video from the International Space Station shows lights in the distance that some think are alien spacecraft.  So far, the media has given about the same amount of coverage to both stories.

I really hate the idiots who run the media.  They could report on news, but they stick to irrelevant nonsense.


Another One Of Those Things No One Talkes About

It's time to discuss another of those items that no one in the USA seems to discuss.  Today's overlooked story is the Chinese stock market.  The Shanghai stock market index declined by more than 3% today.  That means that in the last two weeks, the Shanghai market (China's version of Wall Street) has declined by about 20%.  That is a move of gargantuan proportions.

There's plenty of reason for the decline.  First, the Shanghai market had soared during the last year.  Indeed, even after the 20% decline, the Chinese market is up for the year.  Some view the decline as just getting rid of some of the excesses in valuation that had built up during the boom.  Second (and more threatening), the Chinese have incredibly high amounts of stock bought on margin.  In China, many of the companies on the stock market have major shareholders who do not trade their stock.  The shares that are left to trade freely are called the float.  In the latest figures available, margin debt in China was nearly 9% of the total value of the float.  To put this in context, in the USA, margin debt is something just under 3% of the float and many think it is too high.  So what does this high margin debt mean?  When stock values fall by 20%, the amount of the debt remains unchanged but the value of the collateral goes way down.  For those investors whose portfolios decline by more than the 20% (and there are many of those), there may be a margin call.  In other words, the lender may ask for repayment of the margin loan.  That means that the investor has to sell the stock which backs up the loan in order to have the cash to repay the debt.  More stock sales mean lower prices.  Lower prices mean even more margin calls.  This vicious cycle was one of the reasons for the American stock market crash in 1929 and margin debt has been strictly regulated since that time to avoid a recurrence.  In China, however, they have been loosening the reins on margin debt rather than going in the other direction.  Third, the Chinese economy is no longer booming.  We still have the phony statistics that the Chinese put out to show that all is well, but the real numbers show otherwise.  China's purchases of commodities have dropped (as has world prices), and the main reason why less raw materials are needed is less demand for the finished product.

If you read the news today, all the economic stories are about Greece.  That's an important story, but Greece is tiny compared to China.  If the Chinese market is really in meltdown mode, it could be a storm that few in the world could weather.  Just think of the consequences for the USA if the Chinese were to dump their holdings of US treasury bonds on the market. 


Sunday, June 28, 2015

You Have To Laugh

Time magazine has a column written by Gary Hart.  Remember him?  Most people don't, but Hart was a senator whose most memorable accomplishment was running for president and losing principally because he was caught with a woman who was not his wife.  Hart outlines what he says is the greatest threat to America:  the Citizens United decision by the Supreme Court.  That decision says, in short, that businesses have the right to free speech in the same manner that individuals and organizations do.  Don't you knees start shaking in fear when you read that?  Don't you break out in a cold sweat at the words "free speech" and "businesses" being used in the same sentence?  The reality here is that you just have to laugh to hear a fossilized Democrat denounce Citizens United as a threat to America.

In the real world, people (yes, living real people) understand that there are only a certain number of ways that politicians can communicate with voters.  One is television coverage; there the media other than Fox News are hopelessly biased towards the Democrats and against the Republicans.  Another is print media; once again the major newspapers that remain are mostly biased towards the Democrats.  The there's the internet; right now, there are sites of all sorts that send out there messages to the country.  After the full impact of so called Net Neutrality hits, we will have to see if there are content controls of some sort that appear.  Then there is talk radio; here there are shows on favoring both sides, but the only ones that are successful are conservative.  The problem with radio, however, is that the audience is much smaller than TV or the internet.  Finally, there is paid media, you know, ads.  To put those ads on the air takes cash and a lot of it.  That's where all the fund raising comes in.  In federal elections, contributions to a candidate are limited in amount per person.  If you want to support Lincoln Chaffee for president, you can only give him $2700 for the primary campaign.  While that is not chump change, it is not enough to buy an ad on TV.  That means that enormous time has to be spent by the candidate getting cash from hundreds and thousands of people rather than discussing the issues.  For decades, the Democrats got around this problem by using unions.  Since the unions were comprised of individuals (who had no say over which candidates the union supported), they could give almost unlimited funds to the Democrat candidate.  Citizens United evened that out by letting businesses contribute too.  It broke the monopoly of the candidates of the Democrats on big donor cash, so Gary Hart thinks it is a bigger threat to America than ISIS, economic stagnation, racial issues or even global warming.

As I said, you have to laugh at this self important idiot who thinks that restoring an advantage for the Democrats in campaign cash is more important than issues which implicate the actual survival of America.  The other choice is to cry, and Gary Hart is not worth the effort.