Where are the people to vouch for B Hussein?

Charles Krauthammer makes a great point in his Townhall.com piece this week. Just where are the people that can say they have accomplished something with B Hussein or can vouch for his character? No one is coming forward except his wife? The woman that just recently was proud of her country?

So where are the colleagues? The buddies? The political or spiritual soul mates? His most important spiritual adviser and mentor was Jeremiah Wright. But he's out. Then there's William Ayers, with whom he served on a board. He's out. Where are the others?

The oddity of this convention is that its central figure is the ultimate self-made man, a dazzling mysterious Gatsby. The palpable apprehension is that the anointed is a stranger -- a deeply engaging, elegant, brilliant stranger with whom the Democrats had a torrid affair. Having slowly woken up, they see the ring and wonder who exactly they married last night.

Cartoon of the Day

The Good News Is Bad News For B Hussein

So much for Bush's failed policies. Looks like things aren't as bad as B Hussein would like us to believe. This is from IBD today:

Even so, we were struck by Thursday's news that second-quarter GDP was revised up from 1.9% to 3.3%, more in line with boom than bust. The consensus estimate was for 2.7% growth.

As more than one economist has noted, nearly all of that growth — some 3.1% of it — came from stronger exports, a result of the weak dollar. The rest came from inventories. Take those away, and the economy crawled at a weak 0.2% pace for the quarter.

But listening to the media and the Democrats in Denver, you'd think the economy was in a depression. Well, it's not. In fact, we're modestly optimistic. By the end of this year, all the really bad year-to-year comparisons in growth will be over.

Moreover, oil demand now is falling. The Energy Department recently reported a shocking statistic that got little attention: U.S. demand in June plummeted 1.17 million barrels a day from last year, and a spokesman said prices could fall below $100 a barrel due to rising output in the U.S., Brazil and Canada.

Other data also suggest grounds for optimism. Just this week, the Census Department reported median household income hit $50,233 in 2007, after inflation, a gain of 1.6% since 2001.

Despite the slowdown in growth, the number of people without health insurance fell one million last year, while the poverty rate was unchanged at 12.5% of the population. And believe it or not, the average unemployment and poverty rates under President Bush have been slightly lower than under President Clinton.

Palin

I have to admit that I thought McCain was making a mockery of the campaign by selecting Sarah Palin as the VP nominee. I figured this was nothing more that a cheap trick to address the women vote.

I was wrong. I spent the last couple hours watching some C-SPAN and other interviews here and I have to admit that I am thoroughly impressed by this woman. I really believe she is not a career politician. She has strong fiscal conservative ideals. This woman sold the state jet on EBAY because she thought is was a waste.

CATO even gives her high marks initially. It will be interesting to see how this plays out, but I think McCain made a winning move. B Hussein will have a tough time shooting holes in her story.

Obamanomics, Part?

The NYT ran a transcript of B Hussein's oratory last night at the DNC. I found this part very interesting:

OBAMA: And I'll invest $150 billion over the next decade in affordable, renewable sources of energy -- wind power, and solar power (OTCBB:SOPW) , and the next generation of biofuels -- an investment that will lead to new industries and 5 million new jobs that pay well and can't be outsourced.

I did not know B Hussein had $150B? What he really meant to say, I guess, is that he would take $150B of taxpayer money and distribute that money to several companies that are politically well connected to certain members of Congress. That is $150B that taxpayers won't have to spend on things they value.

If you have health care -- if you have health care, my plan will lower your premiums. If you don't, you'll be able to get the same kind of coverage that members of Congress give themselves.

Really? Just how is he going to force my insurance company to lower my premiums? Are citizens going to have to work to get the same benefits that Congress receives? I know Congress does nothing, but that is only 535 people. Adding 50 million people to that benefit is no small cost.

Now is the time to change our bankruptcy laws, so that your pensions are protected ahead of CEO bonuses, and the time to protect Social Security for future generations.

And now is the time to keep the promise of equal pay for an equal day's work, because I want my daughters to have the exact same opportunities as your sons.

Pensions are protected. The government already has an insurance programs for such cases. But how is he going to protect Social Security? 2% of the population cannot support the benefits for the other 98% forever.

I guess B Hussein has not checked any studies that show there is equal pay for equal work. Differences in work history and tenure are the biggest reason for pay differentials, not sex. If companies could get away with hiring women at a big discount to men, they would. It would be a tremendous cost advantage that would essentially force their competitors out of business.

Individual responsibility and mutual responsibility, that's the essence of America's promise. And just as we keep our promise to the next generation here at home, so must we keep America's promise abroad.

Individual responsibility? Since when did B Hussein encourage this? The massive social programs he proposes encourage dependency, not responsibility.

The -- the reality of gun ownership may be different for hunters in rural Ohio than they are for those plagued by gang violence in Cleveland, but don't tell me we can't uphold the Second Amendment while keeping AK-47s out of the hands of criminals.

When is the last time you heard of AK-47s being used in crimes in this country? This isn't the Middle East. Everyone knows that a Glock 9mm is a much better urban weapon. That proves B Hussein is not connected to the inner city.

I've seen it in Washington, where we worked across party lines to open up government and hold lobbyists more accountable, to give better care for our veterans, and keep nuclear weapons out of the hands of terrorists.

Since when have you been in DC B Husein? From January of this year, there have been 32 votes on spending and appropriations. B Hussein made 7 of them. The rest were non-votes. Care for Veterans? You think B Hussein has heard of Walter Reed? He wants to keep nukes out of Iran's hands...by asking them!

The Democrat ticket is destructive. Having a Democrat in the White House and control of Congress lead to the New Deal and the Great Society programs. We will truly be bankrupt as a country if B Hussein gets the keys.

Polticians Won't....

Arnold Kling at Econlog makes some good points and describes why he is go grouchy lately.

1. That no politician will end America's consumption of foreign oil. Ever.

2. That no politician will figure out a way to bring the bottom half of America's children up to the level where they can benefit from a college education.

3. That no politician will figure out a way to make American health care--meaning virtually unlimited access to specialists and technology--affordable for everyone.

4. That no politician will alter the trends in technology and family structure that are driving the distribution of income and wealth.

5. That no politician will produce a sustainable fiscal outlook without trimming future Social Security and Medicare benefits. (I might have ended the previous sentence simply by putting a period after "outlook")

6. That no politician needs to create jobs. There is always too much work to be done. The problem is never to create jobs. The problem is for individuals to adapt their abilities to ever-changing job opportunities.

7. That no politician will be able to articulate an economic difference between moving labor or goods from country X to country Y and moving labor or goods from Maryland to Virginia.

Now if only people would recognize the all the political BS and ask more from our politicians.

The Supply of Money

I finished reading Ron Paul's Revolution a few weeks ago and it was a great book. In fact, I have an entirely new appreciation for Ron Paul as a result. The only thing that really bothered me about his policy recommendations was a return to the gold standard.

Since then, I have done a lot of reading on inflation and the gold standard and I am again leaning towards changing my position. Originally I thought our economy was too complicated for this type of monetary system, but then again I think I was wrong.

I am more and more convinced that Americans cannot rely on the Fed to control inflation. There is too much pressure from Congress to make new credit cheap, thus increasing the supply of money and triggering inflation (the very short version of the story). The temptation by the government to print money to pay for programs is a something our hedonistic Congress cannot resist.

A good article at Mises.org today helps make the case. Plus, these videos are very good to get another perspective.

B Hussein Nonsense

George Will has a great column in the Washington Post today.

Obama, who might be the last person to learn that schools' cognitive outputs are not simply functions of financial inputs, promises more money for teachers, who, as usual, are about 10 percent of the Democrats' convention delegates and alternates. He waxes indignant about approximately 150,000 jobs sent overseas each year -- less than 1 percent of the number of jobs normally lost and gained in the creative destruction of America's dynamic economy. U.S. exports are fending off a recession while he complains about free trade. He deplores NAFTA, although since it was implemented in 1994, the U.S., Mexican and Canadian economies have grown 50 percent, 46 percent and 54 percent, respectively.

Obama's rhetorical extravagances are inversely proportional to his details, as when he promises "nothing less than a complete transformation of our economy" in order to "end the age of oil." The diminished enthusiasm of some voters hitherto receptive to his appeals might have something to do with the seepage of reality from his rhetoric. Voters understand that neither the "transformation" nor the "end" will or should occur. His dreamy certitude that "alternative" fuels will quickly become real alternatives is an energy policy akin to an old vaudeville joke: "If we had some eggs, we could have ham and eggs, if we had some ham."

What's The Matter With Alaska?

How can Alaskan realistically vote for Sen. Stevens by such a wide margin when there are six other primary alternatives? This guys is a crooked as they come in politics.

From the NYT.

What is even more alarming than Sen. Stevens being on trial is the fact their one of their Representatives, a Democrat, is also under investigation.

I guess it is true that those who rob Peter to pay Paul always get Paul's support. I think I have a new tag line for Alaska....Clean Air, Dirty Politics.

Yet Mr. Stevens, who has long asserted that he alone has the seniority and effectiveness to keep projects coming to Alaska, is not expected to go down easily.

“We’ve got enough Democrats down there already,” Mr. Stevens said in a sometimes combative interview on KTUU television late Tuesday. “If we give them 60 votes, Alaska will never win anything again. I’m in this race to win, and I’m going to win.”

I Pledge Allegiance.....

This really says it all.

Biden

From David Letterman tonight:

"Nothing says change like 35 years in the Senate."

Social Security Adds to Senior Poverty

A new paper from the Independent Institute written by Edgar Browning describes how the return on Social Security contributions is bad for Americans.

One of the most common arguments supporting Social Security is that it reduces poverty among the elderly. Last week, Barack Obama stated that, “Social Security has lifted millions of seniors and their families out of poverty. Without it, nearly 50 percent of seniors would live below the poverty line.” This is almost certainly untrue.

Social Security affects poverty among the elderly in two offsetting ways. While it reduces poverty by providing income to retired persons, it discourages private saving during the working years—ultimately decreasing the private assets people bring to their retirement. The net effect of this is increased poverty among the retired population.

To understand this conclusion, it is important to compare the rate of return on taxes paid that is generated by Social Security to the rate of return people could receive on their private saving. For those retiring in 2008, the average implicit real (inflation-adjusted) rate of return on Social Security taxes paid was slightly below 3 percent—and it is scheduled to decline to under 2 percent in the next forty years. In contrast, if people retiring in 2008 had invested the taxes they paid into Social Security in a balanced portfolio (60 percent stocks and 40 percent bonds), they would have received a return of 5.5 percent.

The difference between a 5.5 percent return and a 3.0 percent return may not sound like much, but in annual returns compounded over a lifetime, this difference has a huge influence on the income available during retirement. In fact, the annual retirement income provided by a 5.5 percent return is double than that provided by the 3.0 percent return of Social Security. Even more compelling, an investment in the stock market averages a 7 percent real return, which would mean an annual income of three times what Social Security provides.

In short, it is likely that we would have fewer poor among the elderly had they been free to invest their taxes in private assets. Once Social Security’s rate of return drops to below 2 percent, it will only continue to aggravate poverty in the future.

While this simple comparison is compelling, it overlooks the huge hidden costs of this system. By reducing the incentive for workers to save privately for their own retirement, we reduce the economy’s saving and investment in productive assets. This means the economy grows more slowly as a result of Social Security and people end up with lower incomes even before they pay their taxes. When this cost is taken into account, the real return from Social Security to those retiring today is actually negative!

And things are only going to get worse. Although Obama assures us, “the underlying [Social Security] system is sound,” economists have emphasized for years that this is not the case. Today, government expenditures on Social Security and its companion retirement program, Medicare, are 7.3 percent of GDP. However, the Boards of Trustees of Social Security and Medicare tell us that figure will rise to 15.2 percent by 2040 if we don’t change the rules for determining benefits.

Ultimately that means we will have to more than double tax rates to pay the benefits Congress has unwisely legislated. Or we will have to cut benefits in half, or some combination. Raising taxes would be disastrous—imagine a 35 percent payroll tax rate (compared to the present 15.3 percent) and higher income tax rates as well. And since Medicare is partially funded by the federal income tax, its rates would have to rise as well.

Neither option is attractive, but cutting benefits is clearly preferable since people would then depend more on private saving. Most economists favor gradually raising the retirement age as the least painful way of cutting benefits. But the longer we wait, the harder it is to implement this option and the more likely we will be forced to accept substantially higher taxes.

The elderly poor, as well as the rest of us, are ill served by politicians who systematically downplay the huge costs of Social Security and delay confronting what is indeed a true crisis.

Yours Truly on CNNMoney

Some version of this should be appearing on CNNMoney.com soon. I responded to the question of whether I am better off today than in 2001. They claim it will be published based on the rights I gave them today.

I am certainly better off than I was in 2001. The value of my 401(k) and other investments are higher (even with a 15% loss YTD). We moved into a bigger, nicer home financed with a fixed-rate 30-year mortgage where we put 20% down. We make two extra payments per year and will have it paid off in 20. My wife and I stick to a strick budget every month and track our expenses to the dollar in Quicken. We never carry a credit card balance, but put most of our expenses on them. We live well, but well within our means. We save over 25% of my income (my wife stays at home with our kids 9 and 12).

Now the above sounds nice, but it comes with great sacrifice. We drive cars that are both 7 years old. My kids do not have the latest fashions or fancy gadgets. We have no big boy toys or expensive hobbies. We do not eat out very often and when we do it is usually at a burger place. My wife is a very diligent shopper whether it is clothes or food and that saves us lots of money every year. No two week vacations to Italy either.

We watch our neighbors buy new boats, cars, and take expensive vacations many times a year. We know they do not save a penny and live on the edge financially. Being smart about money takes discipline and saying "no" to some of life's pleasures.

Now I have read many sad stories on this site. People lose their jobs, cannot pay their mortage or bills and that is a terrible thing. However, some of this is within their control. For one, most of these people never made plans for the rainy day. Unfortunately it started to rain. They bought more house than they could afford. They bought/buy things that were/are luxuries, not necessities (that includes cable TV and cell phones). Many seem to be unwilling to move to a new area or re-train themselves and learn new skills. There are plenty of jobs in this country if you only look (Check out Odessa, TX for instance). You might have to move and acquire some new skills, and maybe even take a small pay cut. However there is plenty of opportunity out there for people committed to change.

Blaming the government and everyone else is the typical response. Unfortunately there is really no one to blame but the individual. Life deals us bad cards some times and we have to be prepared. The beauty of a capitalist system is that it is constantly changing and making our lives better (I would much rather be poor today in this country, than rich 200 years ago). That change effects some people negatively at times. In that case it is time to acquire new skills and look for new opportunities. Hoping Obama or McCain or anyone in government will solve your problems will only lead to more disappointment.

It's Your Senator Too

"While some may call those earmarks or pork, I call them investments in Salina, jobs and also economic development for north-central Kansas."

-- Sen. Pat Roberts, R-Kan., defining congressional spending "earmarks" for the Salina Noon Rotary Club

An NBC/Wall Street Journal poll taken on 7/18-7/21 last month showed that only 15% of Americans approve of the job Congress is doing. That means 85% are unsure or disapprove of the job Congress is doing. So how is it that incumbents keep getting re-elected?

People it is not some Congressman from another state that is the problem. It is YOUR state's Congressmen that are the problem. If anyone in your delegation has served more than two terms in the Senate or 5 terms in the House, then they are most definitely the problem no matter if they are Republican or Democrat.

Presidents are not going to change much if anything at all. It is your Congressmen that will make the biggest impact. Vote for change and vote new people into office regularly. This is the only way to ensure special interests do not overtake policy matters in DC.

No Congressman considers their earmarks pork, even Pat Robertson, but that is exactly what it is. Vote for change.

The Laughter Is The Result of Obamanomics

George Will writes a great column on Townhall.com today. Some snippets:

By 2012 he would "require" the economy's huge energy sector to -- here things become comic -- supply half as much energy from renewable sources as already is being supplied by just one potentially renewable source. About 20 percent of America's energy comes from nuclear energy produced using fuel rods, which, when spent, can be reprocessed into fresh fuel.

Obama is (this is part of liberalism's catechism) leery of nuclear power. He also says -- and might say so even if Nevada were not a swing state -- he distrusts the safety of Nevada's Yucca Mountain for storage of radioactive waste. Evidently he prefers today's situation -- nuclear waste stored at 126 inherently insecure above-ground sites in 39 states, within 75 miles of where more than 161 million Americans live.

But back to requiring this or that quota of energy from renewable sources. What will that involve? For conservatives, seeing is believing; for liberals, believing is seeing. Obama seems to believe that if a particular outcome is desirable, one can see how to require it. But how does that work? Details to follow, sometime after noon, Jan. 20, 2009.

Where will the electricity for these million cars come from? Not nuclear power (see above). And not anywhere else, if Obama means this: "I will set a hard cap on all carbon emissions at a level that scientists say is necessary to curb global warming -- an 80 percent reduction by 2050."

No he won't. Steven Hayward of the American Enterprise Institute notes that in 2050 there will be 420 million Americans -- 40 million more households. So Obama's cap would require reducing per capita carbon emissions to levels probably below even those "in colonial days when the only fuel we burned was wood."

China Vs. USA

Russ Roberts makes a great case for why Americans should not fear China's economic growth. For one, their prosperity only means there is a bigger market for our products. However, China is still desperately poor and the fact their government spent so many resources winning gold medals is a travesty for the Chinese people.

See the Cafe Hayek post.

From the Kansas Dept of Labor

Looks like Government in Kansas is the place to be working. However, when over a third of the jobs "created" in the state are government jobs doesn't that mean we all have to pay more in taxes? Why yes it does. Looks like Gov. Sebelius will be the perfect running mate for B Hussein. Their economics are about the same.

From Kansas Department of Labor:

According to July 2008 estimates, Kansas businesses added 5,200 jobs in the last year, a 0.4 percent increase. Six of the 11 major industries added jobs in the last year.

Government added 3,100 jobs in the last year a 1.3 percent increase. Most of the gains in this area were primarily due to additions in local government.

For the Union Crowd

From the Department of Labor...

Combating Corruption Harming Union Members: During FY 2007, the Department’s Office of Labor-Management Standards (OLMS) secured 100 indictments and 118 convictions against union officials and related parties for crimes, such as fraud and embezzlement. Since 2001, OLMS investigations have yielded a total of 842 indictments with 802 convictions and returned more than $88 million in restitution to rank-and-file union members.

Has to make you feel really good about the effectiveness of the monthly dues....

Free to Work

Over vacation this summer I read Capitalism and Freedom by Milton Friedman. One of the most interesting chapters was on professional licencing and the freedoms they restrict. Sure enough, this is making news today, 30 years of the first publication of the classic.

From Foundation for Economic Education:

An Institute for Justice (IJ) case that last week attracted international media attention vividly illustrates the uncontrolled growth of occupational licensing and the outrageous lengths that a cartel will go to protect all facets of its business from the most harmless of trades.

Mercedes Clemens was threatened with thousands of dollars in fines and criminal prosecution unless she stopped . . . massaging horses. In Maryland two powerful groups decided to monopolize the growing field of animal massage by requiring all practitioners to spend four years in veterinary school -- where massage is not even taught.

Suggesting that only people with veterinary degrees are capable of massaging animals is like suggesting that only people with medical degrees are capable of massaging humans. Preventing Clemens -- who is a licensed human-massage therapist and certified in equine massage -- from working in her chosen trade has absolutely nothing to do with consumer or animal safety and everything to do with the financial interests of the veterinary cartel.

Perhaps the most well-organized cartelization effort underway in the United States today is in the interior-design industry. A powerful faction of insiders has already put thousands of its competitors, mainly middle-aged and elderly women, out of work.

The American Society of Interior Designers (ASID) represents less than 3 percent of all designers, but its members have designated themselves as spokespeople for the entire industry. In over 30 years of lobbying, ASID has never presented a single shred of evidence to support its extraordinary claim that literally "every decision an interior designer makes affects life safety and quality of life."

This kind of protectionism is non-sense. But when you can concentrate benefits and spread out costs you are sure to get corruption and special interest pressure.

Father Ted...The Great Alaska Benefactor

No wonder that Sen. Stevens keeps getting re-elected. He gives more money per capita than any Senator. I hope this guy gets hammered. Alaska was suppose to join the Union and not cost tax payers a dime. I guess they decided to change their policy up North. From Citizens Against Government Waste.

CAGW has brought widespread attention to Sen. Ted Stevens’ (R-Alaska) lengthy record of securing special interest, pork-barrel projects following his indictment by the Justice Department at the end of last month on seven counts of failing to disclose $250,000 worth of gifts from a corporate benefactor. Sen. Stevens helped take home a total of 1,452 pork-barrel projects worth $3.4 billion between 1995 and 2008, and Alaska has been the number one state in pork per capita every year since 1999. Some of Sen. Stevens’ more infamous earmarks include $25 million for a supercomputer to study how to trap energy from the aurora borealis; $750,000 for grasshopper research; $500,000 for the Alaska Spruce Bark Beetle Task Force; $200,000 for the city of North Pole for recreation improvements; and $176,000 for the Reindeer Herder’s Association. Sen. Stevens also defended the $223 million earmark for Alaska’s notorious “Bridge to Nowhere” on the Senate floor in 2005, threatening to resign his seat if Congress removed funding for the bridge. “The incarceration of two members of Congress and the conviction or confession of numerous staff members in relation to earmarks has done nothing to rein in the proliferation of pork on Capitol Hill. This latest allegation about the abuse of power will be ignored at members’ peril,” warned CAGW President Tom Schatz. Read more about Sen. Stevens' indictment. See his "Pork Tally."

View some of the media coverage of CAGW's statistics and comments on Sen. Stevens' pork barreling in the Los Angeles Times, The New York Times, The Scotsman, USA Today and The Washington Times.

Porkers Of The Month Honors

From Citizens Against Goverment Waste today....

Citizens Against Government Waste (CAGW) has named Speaker of the House Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.) Porkers of the Month for leading a do-nothing Congress into a five-week recess. Of the 106 bills enacted since January, 94 -- or 89 percent -- were to name government buildings or lands, extend or make technical corrections to existing laws, or passed either by unanimous consent or with less than 10 dissenting votes. The dubious accomplishments include “Frank Sinatra Day,” “National Plumbing Industry Week,” and “National Day of the Cowboy.” In addition, the congressional leaders have deliberately ignored the October 1 deadline for passing the 12 annual appropriations bills. Only one of the bills has passed the House, and the House Appropriations Committee has approved only four others. In the Senate, the Appropriations Committee has approved nine, but none has reached the floor. The Speaker and Majority Leader appear to be awaiting the presidential election, hoping that the winner will favor higher spending and more earmarks. They had also wanted to avoid a vote on the moratorium on offshore oil drilling, which is typically renewed through the appropriations process, though they reversed course last week and said they would allow a vote. For leaving town after Congress has spent nearly all of its time on frivolous legislation and failing to address critical issues, CAGW names Speaker of the House Nancy Pelosi and Senate Majority Leader Harry Reid the August 2008 Porkers of the Month. Read more about the Porker of the Month.

Media Scare Tactics

Leave it to Harold Meyerson to scare people.... From Shopfloor.org/:

Washington Post Columnist Relies on NY Times, Blows It on Exports
Thursday, August 21, 2008

In “Obama’s Factory Floor,” the Washington Post’s Harold Meyerson today wrongly asserts that the decline in the dollar has not aided manufacturers. The basis of Mr. Meyerson’s claim is a story that appeared in Monday’s New York Times. As Meyerson writes, “Nonetheless, as the New York Times’ Louis Uchitelle reported Monday, most of the rise in U.S. exports has come in corn, wheat and other agricultural commodities, not in aircraft or machinery”.

This is totally false. It turns out that over half of what Mr. Uchitelle claims in his story are unprocessed commodities are actually manufactured products, like steel, chemicals and processed food products. It is manufactured products, not agricultural commodities, that are the driving force behind U.S. export growth.

During the first half of this year, manufactured products accounted for 81 percent of the rise in overall goods exports compared to the first half of 2007. Agricultural exports, by comparison, accounted for just 15 percent of the increase. In fact, exports of machinery and transportation products like aircraft alone increased a third more than all agricultural exports combined!
Mr. Meyerson goes on to ask “Will America ever get its manufacturing back?” Get it back? Last year, U.S. manufacturing production reached an all-time high! The United States is the largest manufacturing economy in the world, accounting for fully a fifth of world-wide manufacturing production in 2006 (latest data available from the United Nations.) Manufacturing production has slowed in recent quarters, but this is mostly due to spillover effects from the ongoing housing recession and a downturn in purchases of motor vehicles, not a lack of export growth.

Mr. Meyerson then goes on to criticize Senator McCain’s support of free trade agreements stating that “McCain has supported every offshoring, free-trade accord, past or pending, that has decimated the Midwest;”. Again, Mr. Meyerson should check his facts. Through the first six months of 2008, U.S. manufacturers had a trade surplus with our Free Trade Partners.

The next time Mr. Meyerson writes on manufacturing and trade, he should first check out the facts. They may lead him to a different conclusion…although knowing Mr. Meyerson’s writings, probably not.

Kids Should Have Liberty Too

I fully support the initiative by college presidents to lower the drinking age. My only problem with the whole thing is they want to lower it to 18. In my opinion, why do we need one at all?

Having a drinking age just criminalizes kids. Kids experiment. We all (at least most) did and were fortunate not to be labeled a criminal (after getting caught).

My list of reasons why we should have NO drinking age:

1. Parents can teach responsible consumption habits when they feel it is appropriate for their kids to consume.
2. Kids that over consume will seek out help if they know they will not be prosecuted
3. Friends will take over consumers to medical care if they think it is appropriate knowing they will not get in trouble
4. It will lower enforcement cost of businesses (no more mean bouncers at the door)
5. Fake IDs (an even bigger offense) will cease to exist
6. Kids can drink in a supervised environment at home, not is some remote field where they can get hurt (see Eagle) and then drive home
7. For some reason legal activity is just not as fun as illegal activity
8. Kids need to learn responsible behavior is more supervised social structure. Not when they go to college with fewer responsible social safety nets.

A good portion of the argument is here.

Obamanomics and Taxes

Hard to believe you can preserve entitlement benefits for all and only raise taxes on 3% of the population.

Then again, he thinks he can raise Capital Gains taxes 5% and pay for $600B in new spending he is proposing in the campaign. This guy must really be the second coming if he can pull of a miracle like that. It would surely be the biggest miracle since Christ fed the multitudes with a basket of fish and bread.

This editorial in today's WSJ gives some good background on the B Hussein tax plan.

Then again, B Hussein could be a giant fraud and liar....

In a June 26 interview on the Fox Business channel, Mr. Obama said he wanted to roll back the Bush tax cuts for those in the top 5% of incomes -- that is, about $145,000 per year. He also voted for the Democrats' fiscal year 2009 Budget Resolution, which would raise taxes on individuals earning $42,000 or more.

Something To Make You Mad.

Exactly why dependence on the State is bad for the poor.

Birth Rate 3X Higher for Women Receiving Welfare

The Russian Side Of the Strory

MIKHAIL GORBACHEV, former President of the Soviet Union, writes a good piece in the NYT Op-Eds today. I tend to agree with him that the Georgians started this mess with the understanding that the USA would back them up.

Russia is still a world power whether we want to beleive that or not. They can play the energy card and hold a good portion of the world hostage. Energy is a weapon just like guns and tanks. We need to remember that in our foreign policy. In fact, we should just stay out of this conflict like we have failed to do in so many others over the last 100 years.

The Lunacy of Energy Independence

Stossel writes perhaps the best column I have ever read of his today.


It's amazing how ideas with no merit become popular merely because they sound good.

Most every politician and pundit says "energy independence" is a great idea. Presidents have promised it for 35 years. Wouldn't it be wonderful if we were self-sufficient, protected from high prices, supply disruptions and political machinations?

The hitch is that even if the United States were energy independent, it would be protected from none of those things. To think otherwise is to misunderstand basic economics and the global marketplace.

Trade also saves us money. "We import energy for a reason," says the Cato Institute's energy expert, Jerry Taylor, "It's cheaper than producing it here at home. A governmental war on energy imports will, by definition, raise energy prices".

Don't Obama and Pickens realize that we get something useful for that money? It's not a "transfer"; it's a win-win transaction, like all voluntary trade. Who cares if the sellers live in a foreign country? When two parties trade, each is better off -- or the exchange would never have been made. We want the oil more than the money. They want the money more than the oil. They need us as much as we need them.

Read the entire column and pass it along.

Why I Recommend Basic Economics From Sowell

Here is part of Sowell's Townhall post this morning.

One of the most widespread and dramatic examples of amateurs outperforming professionals has been in economies that have had central planning directed by highly educated people, advised by experts and having at their disposal vast amounts of statistical data, not available and probably not understandable, by ordinary citizens.

One easy to understand reason is that central planners in the days of the Soviet Union had to set over 24 million prices. Nobody is capable of setting and changing 24 million prices in a way that will direct resources and output in an efficient manner.

For that, each of the 24 million prices would have to be weighed and set against each of the other 24 million prices. in order to provide incentives for resources to go where they were most in demand by producers and output to go where it was most in demand by consumers.

In a market economy, however, nobody has to take on such an impossible task. Each producer and each consumer need only be concerned with the relatively few prices relevant to their own decisions, with coordination of the economy being left to supply and demand.

In short, amateurs were able to outperform professionals in the economy because the amateurs did not take on tasks beyond the capability of any human being or any manageable group of human beings.

Of course the entire column is worth reading.

Another Classic Letter

Prof. Boudreaux writes another great letter...

Don Boudreaux

Here's a letter that I sent today to the Boston Globe:

Derrick Jackson wants government to reduce income differences among Americans ("Politely declining to touch the income gap," August 19). Forget that even poor Americans today generally have greater access to goods and services than did middle-income Americans of a generation ago. Instead ask: what kind of philosophy demands that government adopt and act on values that all decent parents teach their children to reject?

Who among us sends our children to school or to the playground with admonitions to begrudge classmates or playmates possessing nicer clothing or fancier toys? Who among us counsels our youngsters to form schoolyard coalitions for forcibly confiscating expensive sneakers and video games from 'rich' kids for "redistribution" to poorer kids? Who among us would not scold our children for such envy, and punish them severely if they participated in such thievery?

Children should avoid envy and learn to thrive by producing rather than by taking. The same is true for adults.

Sincerely,
Donald J. Boudreaux

B Hussein's Tax Plan

As I suspected, the tax plan proposed by B Hussein is really just a new form of Welfare. Tax credits for people that do not even pay taxes is absolutely unbelieveable.

From the WSJ today.

Moreover, the tax credits would mostly go to those who pay little or nothing in federal income taxes. His trick is to make the tax credits "refundable." Thus, if the tax credit is for $1,000, but the taxpayer would otherwise only pay $200 in taxes, the government would write a check to the taxpayer for $800. If the taxpayer pays nothing in federal income taxes, the government would pay him the whole $1,000.

The latest Congressional Budget Office data shows the bottom 40% of income earners already pays no income taxes. Indeed, they receive a net payment from the federal income tax system -- meaning from the taxpayers -- equal to 3.8% of all federal income taxes, because of the refundable tax credits under current law. The middle 20% of income earners, the true middle class, pays 4.4% of federal income taxes.

Overall, the bottom 60% of income earners pay less than 1% of federal income taxes on net. When "tax credits" primarily go to this group in the form of checks from the government (rather than a reduction in their tax burden) it is simply an abuse of the language to call the spending a tax cut.

Consequently, to say, as the campaign does say, that the candidate's tax plan is a tax cut on net -- and that it would limit taxes to 18.2% of GDP -- is grossly misleading. The Obama tax plan would sharply increase real taxes. It also would come nowhere near to paying for the massive increases in federal spending he has proposed, including the spending that is disguised in the form of refundable tax credits.

Taxes

TAX STAT - The top 1% of US taxpayers is responsible for the payment of 40% of all federal income tax. Ten years ago (1998), the top 1% of taxpayers paid 35% of all federal income tax. Twenty years ago (1988), the top 1% of taxpayers paid 28% of all federal income tax.

(source: Tax Foundation, IRS).


B Hussein could continue this growth. I guess I need to stay out of the top 1%.

Government Debt

Here is a good video series that lays out, in one person's opinion, the financial crisis that awaits the Federal Government. I particularly like Chapter 12.

http://www.chrismartenson.com/debt

Gun Rights

In the old DC, this woman would have been a victim of crime. Instead, she was able to defend herself.

Armed 85-year-old woman forces intruder to call cops

I wonder how B Hussein feels about this?

What is Seen Vs What is Not Seen

Good blog entry today at Mises.org on how the State's spending on roads creates jobs. Here are a couple snippets:

State projects may create jobs, but the proper question is, do they create wealth? The state could easily reduce Michigan's unemployment to 0% by mandating that every unemployed citizen shovel dirt on some state project without pay. Employment alone is not a good indicator of economic success; overall wealth is. Even if state spending can "create jobs," creating jobs alone does nothing for our state's overall prosperity or standard of living.

Let's say the state spends $1 billion on road projects. It is easy to see all the laborers and machinery employed to complete the $1 billion worth of projects. It seems all those laborers and the manufacture of all that machinery signify new growth in the economy. But where did that $1 billion come from?

It came from taxpayers. What use would that $1 billion have been put to had it not been taken by the state and spent on roads?

One billion dollars divided by the state's population of 10 million people equals $100 per citizen. What would all of those citizens have done with an extra $100? Perhaps some would spend it at the movies, some at the hardware store, some on food, some on clothing, and some may have saved or invested the money. If every citizen had that money to save or spend, then every movie theatre, retailer, grocer, or investment portfolio would have received more revenue and produced more goods — and hired more people to make and sell them. How much more? $1 billion.

Too many times people, especially politicians, forget the money that government spends is the people's money. If they were not seeing a significant piece of the paycheck forfeited to the government, they could spend that surplus on other things (maybe even save some of it). What most of us see are the workers and new roads. What we fail to see is all the things that money could have been spent on to actually create wealth instead of just move it around.

The Social Security Myth

I missed this blog entry last week. It seems very relavant as B Hussein starts talking about his economic policies.

From the EconLog:

Andrew Biggs writes,

First, Sen. Obama says, "Social Security has lifted millions of seniors and their families out of poverty. Without it, nearly 50 percent of seniors would live below the poverty line."

This is a common talking point, but let's be clear on what it means: if we forced people to pay Social Security taxes all their lives but didn't pay them any benefits, yes, nearly 50 percent of seniors would live below the poverty line. But this is a silly standard. If we were truly "without" Social Security, we would also be without Social Security taxes, which individuals could then save on their own for retirement. So the better question would be, "Without Social Security taxes and benefits, what would the poverty rate among seniors be?"

The answer is, about the same as the current rate. In the 1930's, many seniors were poor. Today, most seniors are affluent. It is tempting to credit Social Security. However, the main cause is economic growth.

Take away the economic growth of the last 75 years and leave Social Security, and seniors would still be poor. Take away Social Security and leave the economic growth, and most seniors would be affluent.

Government Never Wants the Blame

If you take a look at the current mortgage mess, the government is pointing fingers are everyone but themselves. That alone should raise some suspicion. Here is a segment from the Village Voice on the situation:

Andrew Cuomo, the youngest Housing and Urban Development secretary in history, made a series of decisions between 1997 and 2001 that gave birth to the country's current crisis. He took actions that—in combination with many other factors—helped plunge Fannie and Freddie into the subprime markets without putting in place the means to monitor their increasingly risky investments. He turned the Federal Housing Administration mortgage program into a sweetheart lender with sky-high loan ceilings and no money down, and he legalized what a federal judge has branded "kickbacks" to brokers that have fueled the sale of overpriced and unsupportable loans. Three to four million families are now facing foreclosure, and Cuomo is one of the reasons why.

Cuomo's predecessor, Henry Cisneros, did that [made sure CONGRESSIONAL housing goals were being met] for the first time in December 1995, taking a cautious approach and moving the GSEs toward a requirement that 42 percent of their mortgages serve low- and moderate-income families. Cuomo raised that number to 50 percent and dramatically hiked GSE mandates to buy mortgages in underserved neighborhoods and for the "very-low-income." Part of the pitch was racial, with Cuomo contending that Fannie and Freddie weren't granting mortgages to minorities at the same rate as the private market. William Apgar, Cuomo's top aide, told The Washington Post: "We believe that there are a lot of loans to black Americans that could be safely purchased by Fannie Mae and Freddie Mac if these companies were more flexible."

While many saw this demand for increasingly "flexible" loan terms and standards as a positive step for low-income and minority families, others warned that they could have potentially dangerous consequences. Franklin Raines, the Fannie chairman and first black CEO of a Fortune 500 company, warned that Cuomo's rules were moving Fannie into risky territory: "We have not been a major presence in the subprime market," he said, "but you can bet that under these goals, we will be." Fannie's chief financial officer, Timothy Howard, said that "making loans to people with less-than-perfect credit" is "something we should do." Cuomo wasn't shy about embracing subprime mortgages as a possible consequence of his goals. "GSE presence in the subprime market could be of significant benefit to lower-income families, minorities, and families living in underserved areas," his report on the new goals noted.

Fannie also developed a "flexible" product line, providing up to 100 percent financing and requiring borrowers to make as little as a $500 contribution, and bought $13.7 billion of those loans in 2003. In addition to subprime loans and securities, both banks burst into the "alt-a" market, making alternative products easily available to borrowers who had slightly better credit histories than subprime borrowers, but were unwilling to provide full documentation of their financial histories. (It was the "alt-a" investments that recently brought down the private bank IndyMac.) These risky adventures, according to the 2004 HUD report, prompted Freddie to claim that "the increased goals created tension in its business practices between meeting the goals and conducting responsible lending practices," a self-serving attempt to plant the blame back on HUD.

The HUD secretary is also required to produce voluminous rules that govern how the GSEs meet those goals, and the 187-page rules Cuomo issued opened the door to abuse.

The rules explicitly rejected the idea of imposing any new reporting requirements on the GSEs. In other words, HUD wanted Fannie and Freddie to buy risky loans, but the department didn't want to hear just how risky they were.

While fashioning these final rules, Cuomo wrestled with the octopus-like reach of Fannie and Freddie, which spend tens of millions each year on lobbying firms. The GSEs hired 88 lobbying firms over six years, three of which were friendly enough with Cuomo to give to his campaign committee later.

Now this is the same government that B Hussein wants to take over our health care. Just makes you wonder how many casualties this bureaucracy would create?

The Cost of The War On Drugs

After a few decades of the War on Drugs, it would appear that little progress is being made on eradicating these products. Why is that? Well, when there is demand for a product (IE drugs) then someone (or some group) steps in to meet that market need. If government outlaws the product (prohibition) then it goes underground to the black market. This results in plenty of violence

There have been several news article of prominence lately as it relates to the War on Drugs. Several of those article are about how overzealous, local law enforcement is using SWAT teams to storm innocent people's homes and cause all kinds of damage. One case recently involved the mayor of a small town where SWAT teams killed his two dogs. No drugs (at least that were theirs). From AP.

Reason.tv has a video where the former Police Chief of Seattle declares the War on Drugs a complete failure. They have chosen to stop enforcing many of the anti-drug laws.

Now today, the WSJ has a column about how the War on Drugs is making Mexico an incredibly violent country. This makes it hard for one of our closest allies to maintain law and order.

The War on Drugs is a political boondoggle. It has created a huge Federal bureaucracy that spends billions of tax payer dollars. When the programs fail, it is always because there is not enough money to fight the war properly. So budgets get increased only to follow the same cycle of not enough money next year. Failure like this in the free market results in bankruptcy.

There was a lot of violence in the 1920's due to alcohol prohibition. Today, very few (if any) people lose their life as the result of trafficking in alcohol. Why? Because it is a legal activity that is heavily taxed and regulated by the government.

We could eliminate all this madness my simply making drugs legal. Taxing them and regulating them will actually put money in the Federal Treasury instead of costing all of us billions for no results. It will also keep many non-violent people out of our over-crowed prison system, again saving tax payers billions.

Now I think illegal narcotics and drugs are a terrible thing. However, people should have the right to control what substance they put in their own bodies. It is their decision to pursue a life of destruction. The nanny state cannot dictate "proper" behavior as we can clearly see in the War on Drugs.

The old saying goes that if you want less of something you should tax it. That simple concept can reduce the costs associated with drugs and make all of us better off in the long run.

Ethanol.....yuck.

The Great Ag Heist...From Taxpayers

From Prof. Mark Perry today. See the entire post. It has some good graphics that paint a very telling picture.

Maps are from the USDA's National Agricultural Statistics Service. The average farm real estate value has increased by 85% in the last five years, from $1,270 per acre in 2003 to $2,350 in 2008 (see top chart above, click to enlarge). Many Midwest corn and grain states like the Dakotas, Minnesota, Illinois, Indiana and Nebrask have experience double-digit increases in farm values in just the last year (see bottom chart above, click to enlarge).Strong commodity prices and farm programs, outside investments, favorable interest rates, and tax incentives continue to be the factors that drive farm real estate values to record levels.
Update: With farm real estate values booming, commodity farm prices close to historical highs, and farm profits at record levels (see chart below), this group still needs farm subsidies (e.g. $288 billion 2008 farm bill).

Exxon is Huge....

From a Carpe Diem post today...

ExxonMobil CEO and chairman Rex Tillerson defended his company's staggering $11.7 billion in profits for the second quarter, saying that the company's earnings reflected the magnitude of its business operation. "I saw someone characterize our profits the other day in terms of $1,400 in profit per second. Well, they also need to understand we paid $4,000 a second in taxes, and we spent $15,000 a second in cost," Tillerson told ABC News' Charles Gibson. "We spend $1 billion a day just running our business. So this is a business where large numbers are just characteristic of it."

B Hussein's Investment Advice...More Government

Good reading from ibd today...

Mr. Obama says that he is going to make you better off by increasing taxes. But taxes are like a gigantic pay cut, and it is hard to see the benefit in that.

Or perhaps Mr. Obama is saying he will increase someone else's taxes and give you some of the loot. Well, maybe so, but you had better make sure you get an extra big share — paid up front.
Economics 101 tells us that Mr. Obama's tax increase would over the next five years damage the economy to the tune of about $2.5 trillion. In doing so, it would reduce incomes by at least 3% and on average each month cost 25,000 jobs. (Perhaps yours.)

A job is too precious a thing for the economy to lose and, once gone, is expensive to recreate. Economywide, the re-creation of a new full-time job on average requires about $500,000 of additional gross domestic product, which in turn typically entails about twice that amount of business capital investment.

Mr. Obama would make job creation even harder by hiking marginal tax rates on capital investment by 35% and greatly expanding the regulatory burden on employers.
Be careful not to trade your job for a "mess of pottage" (Genesis 25:29-34.) Though Mr. Obama may promise you an extra big share from one of his new government spending programs, experience says that things never really work out quite that way.

According to the government's own studies, only about 50% of the promised benefit from government spending ever materializes. The rest seems to disappear "down the drain," as A.P. Herbert predicted.

Investing your money in the government is a sure loser — so bad, in fact, that selling shares in such a bunko operation to the public ought to be against the law. But Mr. Obama is by no means the first politician to do so, and many have gotten themselves elected.

Obamanomics

Not sure where B Hussein's economic advisors got their education, but his tax policy is a wreck. Now he wants to give Seniors a free ride? How is he going to pay for all those programs once those making over $250,000 are tapped out?

When AARP thinks its a bad idea, it must really be a bad idea....

"The proposal would exempt comparatively well off, though not affluent, senior citizens from tax and give them a benefit not generally available to working Americans," said the Tax Policy Center paper. It "helps only those low-income seniors who currently pay income taxes. Those too poor to owe any tax _ arguably those most in need _ would get no benefit."

Even the powerful seniors' lobby AARP doesn't seem excited about Obama's idea. An AARP bulletin on the presidential candidates' tax plans barely mentions it, saying that Obama's proposal could partly offset additional taxes that Obama would impose on seniors through higher tax rates on dividends and capital gains.

From Townhall.com

Another Sowell Classic On B Hussein

Thomas Sowell writes another great column that uncovers what B Hussein is really about.

Sowell on Townhall.com

If You Want Less Of It, Tax It.

Further proof that if you want less of something, government just needs to tax it. That goes for cigarettes, drugs, prostitution, transfats, or anything else that people consume. From the WSJ:

Politicians in Annapolis are scratching their heads wondering what happened to all those chain smokers who were supposed to help balance Maryland's budget. Last year the legislature doubled the cigarette tax to $2 a pack to pay for expanded health-care coverage. Eight months later, cigarette sales have plunged 25% and the state is in fiscal distress again.

A few pols are pretending to be happy that 30 million fewer cigarette packs have been bought in the state so far this year. As House Majority Leader Kumar Barve put it, fewer people smoking is "a good thing." Yes, except that Maryland may be losing retail sales more than smokers. Residents of Maryland's Washington suburbs can shop in nearby Virginia, where the tax is only 30 cents a pack, and save at least $15 per carton.

The Maryland pols are so afraid this is true that they've made it a crime for residents to carry two packs of cigarettes that weren't purchased in the state. In other words, the state says it's legal to smoke, so long as you use cigarettes that the government can tax and thus become a financial partner in your bad habit. But if you dare to buy smokes across state lines, you can be fined.

Members of Congress, please take note. Democrats are planning one more pre-election go at a $35 billion children's health program expansion (S-chip) funded by a 61-cent per pack tobacco tax increase. They justify the new levy as a "sin tax." OK, but if Americans don't start sinning a whole lot more, states and Uncle Sam are going to go broke.

Krugman Misses the Point on Universal Health Care

NYT Columnist (and supposedly an economist) Paul Krugman totally misses the key points in the argument against Universal Health Care in the US in his opinion piece today. Some examples:

What’s easy about guaranteed health care for all? For one thing, we know that it’s economically feasible: every wealthy country except the United States already has some form of guaranteed health care.

It is not economically feasible. There is a cost of providing unlimited health care, and it is a cost many cannot afford. Health care has to be rationed just like every other scarce resource. We do not have an unlimited number of hospitals, doctors, nurses or even medications. Today those resource are allocated based on price. For many Americans the prices come in the form of insurance premiums and co-pays, but it is a real cost. Now with HSA and FSA, people can make choices about their health care based on cost. This is a positive step in the reduction of health care costs (actually having people bear the cost themselves makes them think about the true cost).

The politics of guaranteed care are also easy, at least in one sense: if the Democrats do manage to establish a system of universal coverage, the nation will love it.

All people will NOT love it. Particularly the people that see their tax bills skyrocket to pay for coverage for people that would rather drive nice cars and have cell phones instead of paying for health care insurance for their families. The people that have to wait in line for hours to get an emergency procedure or the the people that have to wait months to get in the que for surgery that may save their life will not like it. Just ask the Canadians about this "little" problem with Universal Health Care. The other people that will not love it are the people that can make their own health care decisions that will now be made by some lousy government bureaucracy.

I know that’s not what everyone says; some pundits claim that the United States has a uniquely individualistic culture, and that Americans won’t accept any system that makes health care a collective responsibility. Those who say this, however, seem to forget that we already have a program — you may have heard of it — called Medicare. It’s a program that collects money from every worker’s paycheck and uses it to pay the medical bills of everyone 65 and older. And it’s immensely popular.

Medicare is not all that popular. Ask anyone under 65 if they like getting 1.65% of their check taken out in the form of taxes for 45 years. I don't. Older people are over-consuming health care resources today (at subsidized rates) and that is driving up the cost for the rest of us. For many elderly, there is absolutely no cost for them to spend a couple days in the hospital. Again, those beds are a limited resource. Low government reimbursements through Medicare mean the rest of us have to pay more to cover those expenses. We have the few taking care of many just around the corner which is very different from the many taking care of the few that we experience today.

The Massachusetts plan has come in for a lot of criticism. It includes individual mandates — that is, people are required to buy coverage, even if they’d prefer to take their chances. And its costs are running much higher than expected, mainly because it turns out that there were more people without insurance than anyone realized.

Mandates are just a nice way of saying taxes. It also is code for you do not know what is best for you and the government will show you the light. Costs are higher than expected because people over consume things they perceive as being free.

The short lesson on universal health care is that nothing is free and that prices are the best means to guide decisions. I know of no one that does not like the idea of universal health care, myself included, but then again I know of no one that would not like to live in utopia either. If government really worked this way we could have a department of gasoline that gave us all free (albeit subsidized) gas. Do you really think that would be costless to society? Health care is no different.

Great letter

From Cafe Hayek and Don Boudreaux:

Paul Krugman is confused ("Know-Nothing Politics," August 8). While I agree that Bush's attack on Iraq was both stupid and immoral, many of the reasons that persons on the left (such as Mr. Krugman) offer against military intervention abroad apply equally to "liberals'" case for government intervention domestically.

Just as many on the right naively fantasize that foreign problems are best solved by force, "liberals" fantasize that domestic problems - real and imaginary - are best solved by force. Jobs disappearing in Ohio? No problem - force Americans to buy fewer foreign goods. Too many Americans without health insurance? Force taxpayers to give it to them. The "distribution" of income doesn't satisfy some Very Caring Person's criterion? Government should forcibly redistribute. A mine collapses in West Virginia? Uncle Sam should force mine-owners to increase safety. See? All very simple.

Unlike Mr. Krugman, I believe that both political parties are the party of the stupid - specifically Republicans are the party of the stupid and the hypocritical and the Democrats are the party of the stupid and the arrogant.

Sincerely,
Donald J. Boudreaux

Living the High Life, On the Taxpayer.

This story in the NT Times today really makes me mad.  The story is about low-income people moving to the suburbs which is great.  They are able to get away from crime and drugs that are destroying inner city neighborhoods which is very positive.  What angers me is the fact the government is subsidizing this move and giving families large quantities of tax payer dollars to do it.

Ms. Payne, a 42-year-old African-American mother of five, moved to Antioch in 2006. With the local real estate market slowing and a housing voucher covering two-thirds of the rent, she found she could afford a large, new home, with a pool, for $2,200 a month.

Two-thirds of $2200 per month!  That is nearly how much I pay for my mortgage.  A pool?  I do not even have a pool.

To begin with I am against all forms of long-term government assistance.  The only thing this does is create dependency.  What incentive does Ms. Payne have to get off the tax payer payroll?  She has a nice home with a pool in the suburbs (of course I am not sure how she affords to pay for maintenance of the pool or the utilities).

In addition, the government is killing the value of homes in many neighborhoods by creating a large rental market.  Everyone can see the decline in any neighborhood once it turns into rental properties.  People do not have the incentives to take care of the homes, so you naturally see destruction.  Yet the government does not understand why home values are falling in California?  Again, when the government gets involved bad things usually happen.

Invisible Hand vs Visible Foot

This post on Carpe Diem today was excellent.


When a heavy metal door swung over her 14-year-old son's foot, ripping the nail almost completely off his big toe, Tina Mobley didn't want to take her chances in a crowded hospital emergency room or wait for an appointment at the pediatrician's office the next day. Instead, she drove to an urgent-care clinic inside a Wal-Mart in Yulee, Fla., near her rural home. Within minutes, the doctor on duty numbed the pain with an injection, removed the nail, and cleaned and bandaged the injury.

Patients who need immediate care for injuries and illness, be it a nail-gun puncture or a severe stomach bug, are increasingly turning to walk-in urgent-care clinics. These facilities aim to fill the gap between the growing shortage of primary-care doctors and a shrinking number of already-crowded hospital emergency departments, with no appointment necessary and extended evening and weekend hours. Urgent-care clinics are staffed by physicians, offer wait times as little as a few minutes and charge $60 to $200 depending on the procedure -- a fraction of the typical $1,000-plus emergency department visit. Some offer discounts and payment plans for the uninsured; for those with coverage, co-payments vary by insurance plan but may be less than half the amount of an ER visit, which range from $50-$200.
~Wall Street Journal

MP: Another example of a consumer-friendly, market-driven, convenient and affordable health care option that didn't require Congressional approval, Senate hearings, new legislation, sweeping government reforms, or a government takeover of the U.S. health care system. Never underestimate the power of the invisible hand to provide real, workable, consumer-friendly solutions.

In contast, Senator Obama's proposals for health care reform include new government mandates, increased government regulations, and government subsidies. Never underestimate the power of the visible foot of government to provide imaginary, unworkable, consumer-unfriendly solutions.

The Boone Doggle

I usually get very cynical when a billionaire goes on a crusade for the public good. The T Boone energy "plan" is one of those things that everyone should be skeptical about. Now I really enjoy watching T Boone on TV. His banter with the CNBC anchors is great entertainment. However, his energy "plan" is a complete farse. The $58 Million in advertising to promote his "plan" is just his way of cajoling Congress into forcing people to replace the natural gas used for electricity production into a automotive fuel. Not to mention he also wants to force people to give up their property rights so he can run power cables from his giant wind farms to cities in Texas.

An opinion piece in the WSJ today summarizes the "plan" and all its buffoonery today. Here are some parts:

Having reasons is not "a plan" either, but Mr. Pickens has his reasons. He says we spend $700 billion a year on foreign oil, which he calls a "transfer of wealth." But exchanging money for oil at the market price is an exchange of things of equal value. If we didn't value their oil more than our dollars, we wouldn't participate in such a bargain.

No: As Mr. Pickens says, we can't drill our way out of the dilemmas of living in the world. But drilling is one of many things we can do that are worth doing. Over time, the price mechanism and technology will tell us how to harness the energy that is infinite around us. There's the sun, the tides, geothermal and nuclear -- energy is not in short supply; only know-how is. And a shortage of know-how is a problem that our society, as long as its basic incentives remain intact, is constantly solving every single day.

The good 'ole days.

Movie Night

Looks like this could be a really good movie. Finally something good comes out of Hollywood.

Daily Humor

For the states suffering through budget shortfalls, here are a couple suggestions:

Big Profits Equal Big Taxes

More things the media leaves out about the marginal ExxonMobil earnings:

From Carpe Diem:

Exxon has already paid $19.828 billion in income taxes for 2008 (data here), and will probably pay almost $40 billion in income taxes this year (see graph above, income tax data for 1999-2007 taken from Exxon's annual reports).

To put $40 billion of income taxes in perspective, it can be reasonably estimated that Exxon will pay more in income taxes this year (both here and outside the U.S.) than the entire bottom 50% of American individual taxpayers (about 67 million) will pay in income taxes this year.

Using IRS tax data through 2005 (in Table 6, data here), and making reasonable projections for tax payments in 2006, 2007 and 2008, the bottom 50% of taxpayers will pay an estimated $34 billion in income taxes this year, and it will probably be the first time in U.S. history that a single corporation paid more in income taxes than the entire bottom 50% of U.S. taxpayers.

Update 1: Of course, corporations don't actually pay taxes, they collect them, in the form of higher prices for consumers, lower wages for employees and/or lower dividends for shareholders. In other words, people pay all taxes in their roles as consumers, workers and shareholders.

Update 2: Exxon is a global company and operates in the United States, Canada, Europe, Africa, Asia-Pacific, the Middle East, Russia/Caspian region, and South America. In 2005, Exxon earned about 70% of its profit outside the U.S. and paid 70% of its income taxes outside the U.S., and in 2006 Exxon earned 71.4% of its profits outside the U.S. and paid 81% of its taxes outside the U.S. Source: Exxon's annual reports.

Update 3: What gets reported by the media is Exxon's second-quarter record profits of $11.68 billion for a U.S.-based company, without distinction between profits earned in the U.S. and profits earned outside the U.S. Likewise, Congress reacts to the total amount of Exxon's record profits with proposals of "windfall profits taxes," without a distinction between profits earned in the U.S. and profits earned outside the U.S.

Therefore, when it comes to a discussion of Exxon's income taxes, it also makes sense to look at Exxon's total income tax payments of $10.5 billion in the second quarter, or $40 billion for the entire year. Although not all of Exxon's income taxes are paid to the U.S. Treasury and not all of Exxon's profits are earned in the U.S., I think it is still useful to put $40 billion of taxes into perspective by comparing that amount paid by a single corporation to the amount of income taxes paid by the bottom 50% of U.S. taxpayers. In other words, record profits for Exxon = record taxes for Exxon.

What Politicians and the News Fail to Tell Us.

Most Americans recognize that while gas is expensive and our grocery money doesn't go as far as it did last year, we are still an enormously prosperous and fortunate nation.

In some countries, a depressed economic climate means mass unemployment, political instability and large-scale deprivation. In America this decade, we have reached the point at which even in a down economy, our unemployment rate does not reach 6% (lower than the rates in Canada and the European Union, let alone those in the developing world). Any unwanted unemployment is terrible; but it is worth remembering that this stability especially benefits the economically vulnerable.

Furthermore, no matter what the state of our economy, we can realistically count on uninterrupted provision of critical public services, high business start-up rates, the world's highest levels of charitable giving and volunteering, and countless other benefits that come from living in a successful nation.

We may well be unsatisfied with the current state of affairs. Some Americans are suffering, and cannot be faulted for seeking substantial political change in the coming election. But most of us are reasonable people, and can see the difference between correctable problems within a strong system of democratic capitalism and the kind of catastrophic failure that justifies real outrage.

For the nonoutraged majority, here's what the bumper sticker ought perhaps to say: "If you're not grateful to live in America, you're not paying attention."

~Arthur Brooks in the WSJ