Yesterday I received a long awaited letter in the mail. It came from the US Department of Commerce, Economics ad Statistics Administration. Along the bottom, it read US Census Bureau. Above the window it read United States Census 2010. With fingers trembling with anticipation I tore open the envelope believing that finally I was going to see all the fabled questions I was not going to answer.
Instead of the official, government authorized census form, I got a letter that read… in bold print yet, “About one week from now, you will receive a 2010 Census form in the mail.” The letter went on to tell me how important it was that I fill out the upcoming form so my community would get it’s “fair share” of the borrowed money coming from the beltway bandits. Well, it wasn’t phrased quite that way, but that was the point.
I probably don’t have to tell most readers about this letter, because they apparently sent this out to almost everyone who is anyone. This was annoying on so many levels. First, just massive waste of such a mailing at a time when our government is running out of cash and borrowing from those who are not particularly friendly to us, or just printing more. They are telling us how important their government activities are and how we need to pay attention to them. Read more of this article »
“You don’t blow a bunch of cash in Vegas when you’re trying to save for college.” So goes the wisdom of Barack Hussein Obama as he speaks of frugality in the face of financial distress. This message doesn’t quite ring true as it falls from the lips of one whose only known solution to problems is to spend and spend some more of the taxpayers money in a vain attempt to raise a sinking economy.
On one hand, this utterance of truth is good advice. On the other hand, it reveals a pathology that should give us all pause. Yet, the advice makes sense and we all would do well give it serious consideration. With all the uncertainty, it would seem a smart strategy to not spend money we don’t have on things we really don’t need.
Good financial advisors are counseling people to get out of debt and save their money. Unfortunately, this type of behavior is not the kind of thing that will rejuvenate our troubled financial world. Businesses need customers, people need to spend less money. This is an awkward situation… one that might be remedied if the good citizens felt more confident in their futures and our government were not quite so intent on snagging so much money form their pockets. Read more of this article »
Democrats, desperate for votes, have taken to promoting the idea of legitimizing illegal immigrants under the guise of adding them to the rolls of taxpayers and getting them to pay their share. This idea appeals to the many hard working Americans who do their jobs and pay their taxes… just happy to get some kind of a refund rather than having to dig deeper into their already depleted pockets to give our “betters” in Washington more money to waste.
While the tax code is somewhat public knowledge – as much as any set of rules that massive can be, most of middle America is blissfully unaware that not only do the bottom 50% pay no income tax, many actually receive appreciably more than they pay into the system. Through the magic of what the IRS calls refundable credits, such as earned income, child and child care credit, it is not unusual for someone in these tax brackets to receive a refund two to three times the amount that was withheld for taxes.
This may seem incredible to the average taxpayer, but it is a truth we are living with and paying for. Some will say we should not begrudge these people the extra cash in their pockets as they don’t have too much. There is an element of truth for those of us who care about those around us and individually we should do all we can for them. However, when done as a matter of national policy, what it amounts to is something near and dear to the hearts of progressives through out the land… and that is the transfer of wealth from those evil folks who earn their pay and have the audacity to want to keep it. This wealth transfer is their time honored technique for using taxpayer money to buy the votes that keep themselves in office. Read more of this article »
This video, while done in fun, illustrates the two primary competing economic theories in the world today. John Maynard Keynes is revered by the progressives as they both teach that government intervention will solve all our economic woes. If problems aren’t solved, it just means that they have not manipulated the system enough. Spend and put money in the hands of the little people. Encourage them to spend… not save! We are told by this administration that despite the fact that this spending is digging us a financial hole that we may never climb out of, everything thing will be fine. The question is… fine for whom? We the people or them, the controllers?
The thinking of F.A. Hayek and others in the Austrian school are not quite as well known and followed. The Austrian philosophy explains that the boom and bust economic cycles occur precisely as a result of the economic intervention of governments throwing money into the economy in an effort to pump it up in a effort to force perpetual expansion. The problem is that sooner or later the economic activity runs out of steam and the inflated economy comes crashing down further because of it was lifted up higher. Read more of this article »
We, as a society, have no financial problems. Problems are things that come upon us that we have no control over. But when we create situations that are not good, we really can’t call them problems… they are more like natural consequences. If I run my hand over a sharp knife and it cuts my skin, that is not a problem. It is a self inflicted injury. It is something that could be easily predicted and planned for. It still needs to be bandaged, but I have no right to complain about this terrible thing that happened to me.
We have all sorts of politicians of both parties weeping and wailing about our dire financial problems. They act as if this terrible thing has come upon their poor, innocent selves out of the blue and these hard working public servants are innocent victims of this unforeseen recession/depression. As with cutting our fingers with a knife, running out of money is the result of our government’s own actions… not by uncontrollable circumstances.
The people of this administration, and, to a lesser extent, the one before it, have no concept of the old saying, “If your outgo exceeds your income, your upkeep will be your downfall.” Kids understand this basic economic concept, but somehow it escapes the grasp of our members of congress, even most of our state legislators. What is so difficult to understand about this… it’s not even higher math? Read more of this article »
In recent columns, I have reported on both the attempted takeover of the Hardin, Montana, jail facility by a private mercenary force and a Chinese story that the White House would fly the Communist Chinese flag in honor of the 60th anniversary of Mao’s revolution of 1949, which brought the Reds to power (initially killing as many as 3 million Chinese people, and resulting in the deaths of more than 50 million people during those 60 years).
I promised readers that I would keep an eye out for these stories and provide necessary updates. Well, here are those updates.
The Hardin, Montana, Update:
On Friday, October 9, the private mercenary company that had attempted to take over the Hardin jail facility, American Police Force (APF), announced that it was pulling out of negotiations on contracts with the Two Rivers Authority (the economic development arm of the city of Hardin) to operate the facility. This announcement was made after my column was released and many other news sources, Internet bloggers, and talk radio hosts blitzed the story to the public. We showed how APF’s frontman, Serbian immigrant Michael Hilton, had a criminal record, and is, in fact, currently facing criminal charges for fraud in California. We also reported that APF had fraudulently attempted to identify itself as the “City of Hardin Police Department” by patrolling Hardin’s streets with Mercedes-Benz SUVs with Hardin police markings stenciled on the sides of the vehicles. (The city of Hardin does not have a police department. The city is policed by the Big Horn County Sheriff’s Office.) Read more of this article »
On July 10, Barack “I owe these unions” Obama’s Office of Management and Budget issued a policy memorandum to all federal department and agency heads “encouraging” the use of costly project labor agreements (PLAs) that pushed unionized labor to the front of the line when hiring for federal construction projects. This memorandum was issued in coordination with Executive Order 13502 (available at http://bizy.be/rmASp) which further clarifies the union preference for projects over $25 million.
These union workers represent only about 16% of the construction labor force, yet after supplying millions of dollars to the Obama campaign and thousands of foot soldiers to execute the political ground game, they are now in the preferred position for the taxpayer financed government projects.
PLAs have been touted as lending more stability to the projects. Sometimes they workout, as they did decades ago with the Hoover Dam project. Sometimes they don’t. Boston’s Big Dig project is an example of a project at the mercy of the unions run amok. The project’s budget ballooned from $3 billion to over $15… with a “B” and went years over schedule. Read more of this article »
Many years ago, the Republicans in Virginia came up with a document that sums up what the party says they believe. It pretty much covers the range of issues that concern Virginians and Americans. It presents viewpoints that most citizens could agree with and support. The creed goes back to the beliefs that drove our Founding Fathers when they created a new nation. This is what the Virginia Republicans say they believe:
That the free enterprise system is the most productive supplier of human needs and economic justice,
That all individuals are entitled to equal rights, justice, and opportunities and should assume their responsibilities as citizens in a free society,
That fiscal responsibility and budgetary restraints must be exercised at all levels of government,
That the Federal Government must preserve individual liberty by observing Constitutional limitations,
That peace is best preserved through a strong national defense,
That faith in God, as recognized by our Founding Fathers is essential to the moral fiber of the Nation. Read more of this article »
Some interesting news coming through the usual sources tells us that the Obama administration is drawing up plans to take over any company whose failure would represent a substantial hazard to the US economy. White House spokesperson Austan Goolsbee contends that there are companies that have become such a part of the economic infrastructure that their failure could bring down the entire system. One might look at this as an argument for less of the hyped interdependence promoted shamelessly by our “leaders”. It would be an outstanding reason to build some firewalls into the system.
The misguided arrogance of this plan is overwhelming. First because of the economic track record of our government in having any idea of what will happen down the road and second because of their supposed ability to fix such problems, should they actually exist.
We have seen the accuracy with which they predicted and fixed the the mortgage meltdown. They consistently reassured us that Fannie Mae and Freddie Mac were doing just fine until one fine day it all changed and we, the taxpayers needed to give them billions of our, or our grand children’s money. They kept driving down the standards for giving loans, then were astounded when these loans blew up in our collective faces. To be fair, this is not because of their lack of economic understanding. Their actions supporting the mortgage industry were based on give-away politics rather than than any kind of economic expertise. There were goals that needed to be attained that reached far beyond and around the good of the regular citizens. Read more of this article »
As I write this, I’m just getting warm and dry after enjoying the Richmond Tea Party with a few thousand of my closest friends in a light drizzle. It was good seeing old friends and meeting new ones who are also concerned about the direction of our country. There were many fine speakers but that was almost secondary to just hanging out with our fellow patriots, or possible domestic terrorists… according to our Department of Homeland Security.
People were plenty jolly for being angry about bailouts, angry about government interference, angry about higher taxes and angry about government suspicion of their exercise of their God given rights. It must have been the fellowship of like minded people that let us all know we are not alone. The jovial atmosphere was a far cry from the raucous, sometimes violent demonstrations of leftist students of years gone by and of the G8 and G20 protesters of more recent days. The Richmond police who were on hand by the dozen had nothing to do… not even the ones on horseback.
It’s hard to know if the drive-by medias insistence on seeing this as primarily a tax protest when there are so many other issues at hand indicates either complete misunderstanding of the world we live in or a willful effort to mislead the public. We know what a rarity either case is these days.
The signs showed an desires to end the fed, stop taxing our childrens’ futures, keep the government out of personal lives, keep our guns, etc., etc. If the federal government is overstepping in any way, someone was there to point it out. This showed a breath of concerns and depth of understanding of that appears to dwarf that of our public servants inside the beltway.
Even the local media coverage seemed fair. The station I watched used reasonable quotes from attendees and the head count of over two thousand seemed on target. They even commented on a counter protest that was supposed to take place across the street… but no one showed up. Despite being a tax day, this one turned out pretty good!
The government giveth and the government taketh away. That seems to be lesson we can take away from the recent events in Washington. The good congressmen and senators, eyes bloodshot with rage promised the American taxpayer that the outrage of AIG taking money from the government (read taxpayer), then giving millions of it out to their employees in the form of bonuses would not be allowed to continue.
We were told that these were retention bonuses that would keep these high performing employees on the job. These are the same high performing employees that produced the massive profits that led the company to come back to the taxpayers time after time – promising each time would be the last.
After nearly bursting a blood vessel and almost falling into an apoplectic seizure, Senator Dodd came back the next day and admitted that he had actually inserted a provision in the porkulus bill that specifically permitted these employees to receive the bonuses. So much for the claim of surprise! The man should get an Oscar for his manufactured rage as it’s difficult to be sincerely angry with someone for doing what you said was permissible. After more prodding the good Senator also remembered that that he had inserted the provision at the request of the Obama administration through the Treasury Secretary’s office.
So we have the public and much of our government going into a hissy fit over one more action of our new president. How did this come about? Are the people in the White House so inept or confused that one hand does not know what the other hand is doing? That would be the easy ,but not very comforting, answer. The answer could be more sinister. Could it be one more distraction to keep us from noticing the really damaging behavior of the Obama administration… kind of like the fuss about Rush Limbaugh. Read more of this article »
The initial Paulson/Bernanke/Bush, bailout plan was to get the toxic “assets” off lenders books so they could begin lending again. They came to the conclusion that accounting rules and lack of liquid assets had caused the credit market to “seize up” as they described it… much like your car’s engine would do if deprived of sufficient lubrication. That was the original plan, but it quickly changed to infusing billions of dollars into ailing financial institutions, trusting the management to use it in ways to actually help the economy. We’ve all seen how well that worked.
The accounting rule most reviled by the banks was the “mark to market” rule which required them to carry assets on their books at values they could reasonably expect to sell them for on the open market. That never seemed to be too unreasonable a procedure. That alternative would be keeping values on the books that were greatly inflated beyond any thing they could actually be sold for. For example, why should a five million dollar building be shown on the books for ten million dollars when no one could realistically be expected to buy it at that price? In most other contexts, that would come pretty close to something called fraud. Of course write downs like had a negative impact on the corporate statements. It was, however, a more accurate picture than retaining the higher value and hoping it would, one day, return.
The other rule hurting banks involved reserve requirements for non-performing loans. When a loan, whether a car payment or mortgage is paid on time every one is happy. When the borrower stops paying in timely manner and slips further and further in arrears, the loan is listed as non-performing and the bank needs to keep reserves to cover the situation. This is why lenders will sometimes give substantial discounts to buyers who will take such properties off their books. Considering the costs involved in foreclosures and the release of reserves for other uses, these transactions often turn out to be a win for every one involved. The bank gets a toxic “asset” off the books, the buyer gets a good deal and the borrower is relieved of a debt he can’t pay. Read more of this article »
This morning I watched the news as three urban mayors sat grinning and licking their chops at the thought of even more federal dollars coming their way. The more I listen to the explanations of the various bundles of cash flowing out of Washington, the more I understand that another direction of the income redistribution is from rural to urban areas, from primarily red areas to primarily blue areas.
This should come as no surprise as the Democrats have a long and proud history of favoring their constituents. Their schemes may not lift the poor out of poverty, but they give them occasional goodies and the occasional satisfaction that those who are better off would now be less better off and experiencing some pain as well. It’s payoff time in the cities. Besides, if they ever did resolve the problem of poverty, they understand that people no longer looking for a handout gravitate to the other party.
The inequity of distribution is aggravated by the fact that these cities tend to be the least efficient and most corrupt governments in the country. There is even talk about the cities getting the funds directly from Washington and not having to submit to the adult supervision of state governments.
Where is this money going? Part of it is going to maintain bloated city budgets and retention of the overpopulation of municipal workers. Union workers, I might add… dare we say more of the money flowing to Obama supporters. Another part of it is going to build infrastructure and amenities for city dwellers. Read more of this article »
AIG, we are told is too big to fail. Same with General Motors and a host of other corporations run by, at best, semi-competent but connected executives. They employ many but control boatloads of assets. Unfortunately not enough assets as they found themselves owing more than they could pay. The courts have a way to deal with these situations. It’s called bankruptcy. For you and me this is the way to resolve these negative situations.
These rules are for the little people. If you are big enough, rich enough or contribute enough, they somehow don’t apply. Your friends in government will be happy to take taxpayer money and give it to you. This has happened before and will happen again, and again, and again!
To keep up with this high end charity, our government goes deeper and deeper in debt. Our government is running up debts that are getting very close to exceeding it’s ability to pay. What happens when our government finds itself in this position? Is it too big to fail? Who will bail it out? Will they turn to us, the taxpayers as an unlimited source of funding once the rest of the world, which is running out of money itself at a breakneck pace, stops buying our paper? Read more of this article »
Many of our problems today come, not from any particular event or situation, but from a lack of confidence to move forward. The stock market is basically in a downward spiral because investors don’t believe problems are being fixed… in fact they believe just the opposite. Banks aren’t lending money… maybe because they don’t have confidence in the economy the borrowers will operate in, or perhaps they feel they’ve been burned and lost confidence in their own ability to make good decisions and they’ve become overly cautious.
It appears that we don’t really have an economic problem… but a confidence problem. It’s not that we lack cash… the Fed is printing paper just as fast as the presses will run. We have a president with no lack of confidence in his ability to do everything short of walking on water. As we haven’t discussed the matter, it may be that he believes it possible to be an aquatic pedestrian. At this point thought, his extreme confidence in himself is not shared by Wall St. or Main St. People have begun saving what money they have and stopped buying much that they really don’t need. The economy is slowly grinding to a halt.
One would think that all the people who voted for the O-man would have the confidence to move the economy forward, yet even they… the bankers who received bailout money… and gave some to his campaign… don’t have the confidence to start the credit flowing again. For the bankers, it’s not a cash shortage, they just received billions of our money from the government, but an unwillingness to lend it out. It’s hard blame them too much as they’ve made a couple too many bad choices with their own money… some because of government rules and intimidation. Read more of this article »
Years ago, a cartoon appeared in a Russian newspaper picturing a fork in the road. One path was labeled freedom; the other path was labeled sausage. As we might guess, the path to freedom had few takers; the path to sausage was crowded with footprints.
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Yesterday I received a long awaited letter in the mail. It came from the US Department of Commerce, Economics ad Statistics Administration. Along the bottom, it read US Census Bureau. Above the window it read United States Census 2010. With fingers trembling with anticipation I tore open the envelope believing that finally I was going to see all the fabled questions I was not going to answer.
“You don’t blow a bunch of cash in Vegas when you’re trying to save for college.” So goes the wisdom of Barack Hussein Obama as he speaks of frugality in the face of financial distress. This message doesn’t quite ring true as it falls from the lips of one whose only known solution to problems is to spend and spend some more of the taxpayers money in a vain attempt to raise a sinking economy.
Democrats, desperate for votes, have taken to promoting the idea of legitimizing illegal immigrants under the guise of adding them to the rolls of taxpayers and getting them to pay their share. This idea appeals to the many hard working Americans who do their jobs and pay their taxes… just happy to get some kind of a refund rather than having to dig deeper into their already depleted pockets to give our “betters” in Washington more money to waste.
We, as a society, have no financial problems. Problems are things that come upon us that we have no control over. But when we create situations that are not good, we really can’t call them problems… they are more like natural consequences. If I run my hand over a sharp knife and it cuts my skin, that is not a problem. It is a self inflicted injury. It is something that could be easily predicted and planned for. It still needs to be bandaged, but I have no right to complain about this terrible thing that happened to me.
In recent columns, I have reported on both the attempted takeover of the Hardin, Montana, jail facility by a private mercenary force and a Chinese story that the White House would fly the Communist Chinese flag in honor of the 60th anniversary of Mao’s revolution of 1949, which brought the Reds to power (initially killing as many as 3 million Chinese people, and resulting in the deaths of more than 50 million people during those 60 years).
Many years ago, the Republicans in Virginia came up with a document that sums up what the party says they believe. It pretty much covers the range of issues that concern Virginians and Americans. It presents viewpoints that most citizens could agree with and support. The creed goes back to the beliefs that drove our Founding Fathers when they created a new nation. This is what the Virginia Republicans say they believe:
Some interesting news coming through the usual sources tells us that the Obama administration is drawing up plans to take over any company whose failure would represent a substantial hazard to the US economy. White House spokesperson Austan Goolsbee contends that there are companies that have become such a part of the economic infrastructure that their failure could bring down the entire system. One might look at this as an argument for less of the hyped interdependence promoted shamelessly by our “leaders”. It would be an outstanding reason to build some firewalls into the system.
