The trouble with most of us is
that we would rather be ruined by praise
than saved by criticism.
Norman Vincent Peale
Barney Frank Wants People to Remember He Always Was a Spendthrift
"In this terrible situation, let's be very grateful that we had a well-funded, functioning government. It is very fashionable in America, and has been for some time to criticize government, belittle public employees, talk about their pensions, talk about what people think ... of [their] health care. Here we saw government in two ways perform very well. ... I never was as a member of Congress one of the cheerleaders for less government, lower taxes. No tax cut would have helped us deal with this or will help us recover. This is very expensive."Just a reminder, former Congressman: it's not just conservatives that criticize the government and government spending: in 2006, all voting Senate Democrats, including one Barack Obama, voted against raising the debt limit to $9T. In the House, all voting House Democrats, including one Barney Frank, voted against the same increase. The hypocrisy is appalling. Of course, the Dems could argue the same, but there were differences: first, the GOP leadership was trying to cut spending to keep within the debt ceiling but lost enough votes by vulnerable incumbent legislators there was no alternative for a governing majority. Democrats were mostly protesting war spending and the Bush tax cuts; they had no interest in across-the-board budget cuts--in fact, they wanted to spend more; they were able to demagogue the debt ceiling as phony fiscal conservatives while hypocritically voting for bigger deficits.. Second, some GOP legislators in each chamber voted against the debt increase on grounds of fiscal conservatism. Third, the deficits and the national debt were much smaller, than they are now: there's a qualitative difference between increasing the credit limit if debt is sustainable and after the size of the debt surpasses GDP. Moreover, the Democrats want to lock in increased spending through tax hikes--which tend to shrink the tax base and GDP.
Nobody is belittling public employees; I was a professor for 5 years at state-supported universities, and I have worked for a variety of public sector clients; I have relatives who are working or have worked in the public sector. Some public employees are worth every penny, but public service is a privilege, not an entitlement. I do think the Democrats have made some unsustainable commitments to union cronies; taxes cost the economy, and the government has to live within its means and set priorities; . I don't necessarily blame public employees for that; it's not personal. A lot of good private-sector employees lose jobs through no fault of their own. I see Frank's allegation of "belittling public employees" as spurious. Many agreements bind the hands of managers; managers have little choice in, say, retaining talented junior teachers during layoffs, and it is not unheard of for some nurses or even bus drivers pile up premium-rate hours on the way to six-figure incomes. The USPS is restricted in the hiring of part-timers or contractors. These agreements are to the benefit of public sector unions at the expense of the taxpayer, whom would rather keep more of his money to save, invest and spend much more efficiently and effectively in the real economy.
"Talk about their pensions?" Of course! Federal benefits, beyond higher job security, which I consider fungible, are up to 4 times more generous that those of employed in the private sector. Worse, the government has not funded these retirements any better than social security and Medicare. What is happening is the government is deferring funding to future generations. Look at what's happening in Stockton, CA, where the city is slashing headcount, including police and firemen, and juggling creditor bills to make payments to the underfunded public retirement system. Just to give an example, military retirement (which is possible before an active-duty person reaches 40 at 20 years in, at least 50% pay for life) reform was discussed when I was in the Navy--many years later virtually the same system remains the same. I have at least 3 relatives drawing military retirement; I don't fault them--they didn't make the rules; they're not the irresponsible legislators and Presidents whom have made the commitments without adequately funding their liabilities. Do I want to reform the system? Yes. It's not personal; we have unsustainable obligations. We can reform the system now--or wait until the house of cards collapses and we face a choice between slashing benefits or printing money, which is inflationary in the long term.
"I never was as a member of Congress one of the cheerleaders for less government, lower taxes." Yes, no one expects the irresponsible legislator whom rolled the dice on Fannie and Freddie and came up craps to be a fiscal hawk. "Less government, lower taxes" is a relative concept; I accept the need for government security and justice--which are clearly relevant in the case of the Boston Marathon terrorist attack--but Frank's attempt to justify the $3.7T federal budget based on Massachusetts-funded first responders doing their job AFTER the attack is utterly pathetic. Keep in mind security is part of any event, and there are obvious clusters of spectators to any event--whether we are talking about the finish line of a marathon or the 18th hole of a major golf tournament. But to be honest, I would have been more impressed if the bombs had been intercepted. I'm not arguing that law enforcement or event security was incompetent: the terrorists are at fault, but to be honest, what keeps running through my head is as a road warrior after 9/11 constantly hearing the airport overhead speakers call out about reporting abandoned briefcases/other items--even after they've presumably gone through security.
What Barney Frank fails to understand is that there are economic costs to excess government, to government that ventures beyond its few distinctive competencies, that one needs to compare the marginal benefits of additional government against the opportunity costs of incremental taxation theft from the real economy. I don't know a single credible economist whom thought the best thing after the economic tsunami was for the Dems to pass Dodd N Frankenstein and ObamaCare and engage in morally hazardous spending binges (2 years of unemployment, etc.)
Government is a cost; it gains revenue at the expense of the economy; it competes for resources, driving up prices. (The inflation-bound healthcare industry reflects the effects of bad government policy--discriminatory tax expenditures, special-interest benefit mandates, community rating, guaranteed issue, etc.)
Familiar readers probably know where this is going. For politically exploiting a tragedy in order to launch an unsupported attack against the Tea Party and the GOP, Barney Frank has earned a nomination for this year's tongue-in-cheek JOTY award.
Boston Marathon Massacre's Heroes
The Telegraph has a nice little post about how Americans responded to fellow Americans in the wake of the attacks including, but not restricted to:
- more offers to donate blood that the hospitals could use
- potentially life-saving tourniquets applied to seriously wounded victims
- restaurants opening their doors providing payment-optional meals, beverages, Internet to those caught up in the tragedy
- people helping move victims from the scene
- people opening up their homes to out-of-towners caught up in the tragedy
Patterson, Chained CPI, etc.
Regular readers may remember that I blasted the former George W. Bush speechwriter for blaming Romney's loss on running on libertarian/free market principles. Now he's taken on the chained-CPI "trap" by Obama.
If you think he's taking, once again, similar talking points of outraged progressive Democrats, it's because he is. Among other things, Patterson is arguing that social security funding is not a real problem (never mind those pesky warnings on annual social security statements about the trust reserves exhausting in 20 years, if not earlier--we are already running a pay-go deficit). It's portrayed as an assault on the middle class, etc.
I don't want to get wonky in the blog, but the conservative Heritage Foundation, which labels chained-CPI as a step in the right direction, explains the concept. As prices go up, we may switch to less costly goods. They use the example of a banana. Suppose a banana is part of the current CPI. If bananas go up in price, the CPI adjustment would track that increase. But maybe the consumer takes notice and substitutes a cheaper, in-season fruit. (For example, I love to buy fresh berries during the summer months when they're cheaper. At a certain price point, as berries go out of season, I'll switch to less expensive frozen berries.) Long story short, in the context of this example, the CPI can overstate actual food cost increases. It ignores substitution effects. So you get the benefit of the banana increase--but you are actually purchasing cheaper fruit. Thus, current CPI increases are not neutral but make the beneficiary better off--at the expense of the reserves for future beneficiaries.
The net effect of the chained-CPI is to moderate benefit increases. As I pointed out in a North article review in a recent post, CPI reform has been advocated by fiscal conservatives for years, and Speaker Boehner raised the issue during the fiscal cliff talks..
From RollCall:
National Republican Congressional Committee Chairman Greg Walden touched a nerve Wednesday when he savaged the entitlement changes in President Barack Obama’s budget as a “shocking attack on seniors.”
Hours later, Walden told CNN’s Wolf Blitzer that Obama was “trying to balance this budget on the backs of seniors.
Many GOP operatives fear Obama’s embrace of chained consumer price index, a mechanism to slow the growth of Social Security benefits over time, is a trap — a means of getting Republicans to support the policy on the record only to see Democrats savage them for it down the line.
On Wednesday, Boehner reiterated the GOP’s call for entitlement changes that would help balance the budget in 10 years, a stand that would require far bolder steps than the relatively modest policies in Obama’s budget. The Ohio Republican also praised Obama for including changes in his budget.
On Thursday, Boehner said, “I’ve made it clear that I disagree with what Chairman Walden said. He and I have had a conversation about it. This is the least we must do to begin to solve the problems of Social Security.”For putting politics ahead of principle, Congressman Walden earns a nomination for my first Bad Elephant of the Year award.
Political Cartoon
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| Another brilliant cartoon by IBD's Michael Ramirez via Townhall |
Kiss, "Rock 'N Roll All Night". The hit song that put Kiss on the map...
