Miscellany: 1/31/15

Quote of the Day
I will never put my name on a product that does not have the best that is in me.
John Deere

Labor Fact of the Day

According to data released by the Bureau of Labor Statistics today, the union membership rate [in 2014] fell to 11.1 percent, with just 14.6 million wage and salaried workers maintaining membership; the rate of union membership for public-sector workers last year was 35.7 percent, compared to just 6.6 percent for the private sector.

Image of the Day

The Right To Travel Unfettered?




The Bush/Obama Legacy of Slow Economic Growth

This week's announcement of fourth-quarter growth slowing down from an annualized rate of 5% in the third quarter to 2.6%  and a 2.4% rate in 2014 as a whole extended a 9-year streak of sub-3% growth, the longest stretch at least since BEA maintains GDP data online (since 1930). [3% is the long-term growth rate and a typical threshold where we start seeing positive outcomes in the labor market--more robust hiring, income, etc.] I recently pointed out Bush's streak of 2%-plus quarterly growth from 2003-2006; in fact, Bush achieved 3%-plus in 2004-2005; I'm not trying to make this a partisan issue, except Obama explicitly took claim for the economy's strongest performance since 1999, i.e., the Clinton era, which I debunked in the post. In fact, 2014 is the fourth straight year that Obama has failed to top 2010's GDP increase of 2.5%. This week's sluggish stock market in part reflects disappointment over Q4 data; I was not surprised, nor should my faithful readers, because I've been pointing out the effects of the sharp oil market correction on investment and jobs in the shale oil industry. (It is true that there is an upside to the oil market story, i.e., more discretionary income for consumers, but we are likely just beginning to see the economic impact in terms of well-paid job losses and recently announced cutbacks in capital expenditures; production cutbacks will be phased in because of ongoing contractual commitments. Note that many of these contracts have downsize oil price hedges, and I expect sometime over the year we'll find out more about the parties on the losing side of these transactions.) I suspect the energy industry will continue to drag on the US economy over 2015, and I also think the currency wars will be a drag as US exporters find them increasingly priced out of sluggish world economy.

The Fed seems to be determined to raise interest rates over the coming year, which disappointed Wall Street, although they are in no hurry to raise them soon. It seems, though, as though we are in the early stages of a global currency war. It goes beyond the yen and the euro; for example, Denmark just cut its CD rate for the third time in 2 weeks to remain competitive with the euro--and reportedly one local bank is actually paying some customers to take out a mortage! It has caused a Y2K-like challenge for IT applications, which were not designed to accommodate negative interest rates. We are already seeing surging imports and declining exports; I still have problems seeing the Fed doing something to strengthen the dollar once they start smelling deflation in the air. Treasury notes are already picking up strength, not only because they are effectively the "gold standard" in safety but paying higher interest than many OECD competitors. (If anything, they could use the occasion to start unwinding their balance sheet...) There are rumors of American Blue Chippers like IBM and Microsoft about to layoff workers. I think we'll see the stock market and job markets struggle just to tread water, never mind advance. I think we'll see GDP figures continue to struggle moving forward. If and when GDP heads to 0% growth--we know what's coming. Been there, done that: another round of QE.

Crimes of Teacher Crony Unionism: The Zero-Sum Game of Teacher Tenure and Your Child's Future

[Gov. Andrew Cuomo  (D-NY)] said he openly disagreed with a teacher union member who said he represents the students.
“No, you don’t,” Cuomo said he told the person. “You represent the teachers. Teacher salaries, teacher pensions, teacher tenure, teacher vacation rights. I respect that. But don’t say you represent the students.”

Political Cartoon

Courtesy of the original artist via Heritage Foundation

Musical Interlude: My Favorite Vocalists

Joe Cocker, "Cry Me a River"

Miscellany: 1/30/15

Quote of the Day
You have to believe in yourself.
Sun Tzu

Earlier One-Off Post: 2015 State of the Union Address: Critique Part I: The Introduction

Image of the Day

Let's Celebrate the Birthday of One of the Worst Presidents in American History: The Roosevelt Song (Played to the Melody of  'America the Beautiful')

For infamy, for welfare state,
For fascist NRA.
You gave East Europe to the Reds
In Yalta one fine day.
Oh Roosevelt, oh Roosevelt,
God curse the likes of thee.
The bums you fed
Are glad you’re dead.
And so, by God, are we!

Background on the Historic California Teacher Tenure Case



Romney Is Out: Thumbs UP!

The sad truth is that the "real" Romney may have shown up this time around.  One of the issues that Romney had originally run in Massachusetts unsuccessfully for the Senate and then as governor on more of a progressive platform, specifically distancing himself from the more conservative message. The interesting thing is, perhaps due to his business background, he carefully marketed his image to the electorate, saying what he thought was what the target voters wanted to hear. Notoriously he ran on a more pro-abortion choice position. It was true, of course, that the Dems were trying to define him as "too extreme" for Massachusetts, and they accused him of basically of being a wolf in sheep's clothing, willing to say whatever it took to get elected. I do think that Romney was never a principled conservative, that he believed in government and has been confident in his ability to manage it effectively. In contrast, we pro-liberty conservatives of course don't want tax money wasted, but we believe that government has strayed beyond its core competencies; running nonessential government efficiently is suboptimal: free the real (private) economy to meet relevant consumer needs through dynamic competition.

It was fairly clear by Romney's mid-term as governor that he was eying the open GOP Presidential nomination in 2008 and had transitioned to a more conservative perspective, which I never felt was principled but reflected what he thought was necessary in marketing his image to win in 2008. I would have respected Romney more if he was more principled; he became the Republican version of Flip-Flopper John Kerry in the 2008 campaign. We started seeing video clips of those Massachusetts campaigns. He sought to explain away his earlier more skeptical views of the Iraq mission, more immigrant-friendly rhetoric. This had a lot to do with why I supported McCain over Romney in 2008 (before I transitioned to a more pro-liberty perspective); I later developed some nagging concerns about McCain: his selection of Palin; his mishandling of TARP, and it seemed like his legendary straight talk had morphed into political spin as usual.

In many ways, the 2012 Romney candidacy seemed unlikely; Romney seemed like Obama's perfect straw man opponent: a multimillionaire several times over who had a career in the hated financial sector, including rehabilitating businesses with failing business models, a natural target for Obama's union allies. Never mind the nonsense about car elevators and the like. But it wasn't just that: Romney had a hard time dovetailing with the Tea Party movement, and his role in the precursor of RomneyCare largely neutralized the popular opposition to ObamaCare. His 59-point economic plan was beyond the grasp of most American voters. The anemic economy, huge debts under both Bush and Obama, and unpopular American military intervention gave Romney a perfect opportunity to run against 12 years of Bush and Obama, but Romney decided to try to run to the right of UBL-killing Obama. Now it may surprise blog readers who read through old posts to wonder why I didn't publish my reservations during the campaigns of McCain and Romney; I think in part I was somewhat vested in their candidacies and considered the Presidency of Barry Obama the worse evil. I didn't want to be quoted by some Obama operative.

It seemed the third version of Romney gave him more reinvented makeovers than pop music icon Madonna. This time it seemed like he wanted to talk about income inequality, etc. I guess it depends how he would take on the topic, but my preferred approach is to point out how capitalism has raised more people out of poverty than any State intervention. But I think in reality he was identifying, along with John McCain, with the progressive wing of GOP politics since the Teddy Roosevelt era. This may appeal with independents and moderates, but my guess is that if voters want the Statist approach, they would go with the real thing, i.e., fascialist Hillary Clinton and her Democrat minions. No, the Big Government GOP is not the winning ticket for 2016. We need a real voice who diagnoses government failure and prescribes less government spending and regulation. So far the only politically viable candidate along that line is Rand Paul.

NFL and the Taxpayer




Facebook Corner

(Varney & Co.) Should vaccines be mandated? We debate with John Stossel
I had to scan a number of comments to ensure I wasn't repeating what others are saying. In part, it depends on the nature and extent of the contagion, and I have an issue with Alvarez' approach of a federal mandate vs. traditional state regulation based on the principle of Subsidiarity. But, as the great Walter Block points out, in the case of Typhoid Mary, her (unknowing?) exposure of the disease to others is a violation of their unalienable rights, a violation of some form of the non-aggression principle. Similarly, I have a responsibility of ensuring my child does not spread a contagious illness; vaccines are an appropriate proactive response. Obviously we need to be mindful of certain issues, like a child's allergies or intolerance for said vaccines.

(Cato Institute). "As virtually all the research shows, attracting more high-skilled immigrants will stimulate economic growth and job creation by boosting innovation and productivity."
It never ceases to amaze me how a Nowrasteh post brings out all the anti-immigrants and labor protectionists out in full force. Most of them never even read the article. Nowrasteh specifically distances himself from the rhetoric Hatch is using but argues for I-Squared (and I agree). It's not simply a case of hiring foreign widgets. Quite often, foreign professionals bring more complementary and/or entrepreneurial skills, over and beyond the native population. I myself have worked at 3-4 companies founded by first or second-generation immigrants, and one of my best friends, an Indian-American IT manager, is also the CEO for an application software company which was trying to attract venture capital investments.

It might be interesting to know what those differences are and how to nurture the same among native workers--perhaps the resources and opportunities for talented professionals aren't available in their native countries, but don't look a gift horse in the mouth. Those immigrant patents and new businesses could be facilitating economic growth elsewhere. The important point is that freer immigration facilitates economic growth, including growing the professional opportunities available to native high-tech workers. We need for the government to get out of the way of businesses hiring the talent they need wherever they are located to drive business growth and success; We need to welcome immigrants who want to be an American success story.

But personally, I'm sick and tired of all the anti-immigrants who keep worshiping restrictive immigration processes since 1921. The economic evidence for a more open immigration system is compelling. What I'm afraid of is that aspiring immigrants will be discouraged by all the ignorant xenophobes spamming Cato Institute threads; be assured these ignorant fools and their morally repugnant ideology are not representative of most Americans.

(Cato Institute). "Free trade and free trade agreements are meant to open up the U.S. economy to foreign competition and opportunity. The result is economic growth, innovation, better quality of life, more jobs, higher wages, and international peace."
Well, let's be honest here; as Don Boudreaux among others has pointed out, we don't need to negotiate free trade---we simply let it happen. In fact, I'm willing to support unilateral free trade. If other countries want to subsidize my personal consumption at the expense of their own citizens' welfare, by all means.

The fact is that the economy shifts along with technological change. In just over a century, we've come from an economy where 40% of jobs were farm-related to about 2%. By the 1940's, productivity was so strong that the federal government was setting and enforcing crop quotas in an effort to keep prices artificially high. Yet I haven't heard Obama gripe about the need to expand farm jobs by manipulating trade policy. In fact, we were also transitioning to a more service-oriented economy by the time POTUS was in diapers, just over a quarter of US jobs, to maybe just under 10% today. We were not losing jobs so much to export-oriented third-world economies as to technological changes making labor more productive. So this trend was underway long before demagogues started making China and its dollar peg a scapegoat instead of failed domestic economic policies (in particular, the self-serving regulatory bureaucracy) crippling economic growth.

In fact, Obama, mindful of his crony union support, has called for a doubling of US exports but has not closed on TPP or TTIP; he's done little beyond closing on 3 deals that Bush had negotiated before leaving office. Let's face it: every country and almost all politicians always hype trade deals not on providing consumers with a greater variety and more competitive-pricing, but on providing more export-related jobs.That, of course, is a 2-way street for why other countries want access to our 320M consumers.

Fundamentally, liberalizing trade policy is a win-win game. And currency or trade wars are a lose-lose proposition. It is time for Obama to start thinking of his legacy instead of promoting the protectionist agenda of crony unionists.
Bullshirt. It offers Big Business and the 1% a way to undermine America and it's working people to line their greedy pockets.
Fascist, morally corrupt thread. Free trade is fundamentally pro-consumer. If some corporation (let's take the favorite whipping boy of leftists, WalMart) earns a decent profit providing goods and services more affordable to lower-income people, why should I care? It's a win-win situation.
Yeah actually the result is the entire domestic economy being beholden to the price of oil (needed to transport the imported goods); and the average American worker being forced to compete with five billion destitute third world laborers whose labor is made even cheaper by currency manipulation. But why would the one world government shills at Cato care anything about that.
Crackpot economically illiterate leftist rant (well, there are also some paleoconservatives who also promote mercantilist policies). It is true logistics costs make imported goods more expensive, but noncompetitive domestic costs don't make our own goods and services exportable, and they lower our standard of living as consumers. I hate to break the news to you, but we've been an increasingly services-dominated economy for decades now, long before you started scapegoating the Chinese for natural technological advancements making existing labor more productive. In fact, global recessions make export-dependent economies more unstable, and manipulating currencies exacerbate issues--for example, by maintaining a currency peg, the Chinese subordinate monetary policy to our feckless Federal Reserve--and they've found themselves with chronic inflation issues affecting lower-income people and more costly imported resources like oil, which increases costs (including factors of production). The Chinese government is trying to shift their economy to a more stable consumer-oriented economy.
(side comment)
A side comment: "one world government shill"? How ignorant are you? Libertarian entities like Cato Institute are skeptical of government--at least government beyond minimal functionality like common defense and enforcement of contracts. It is true we don't like artificial constraints on our liberty to migrate, transact beyond the border, etc. One of our complaints about government is that it is a monopoly, and we view any sort of central planning with outright skepticism. We believe in competition, not empire. A one-world government would be the ultimate libertarian nightmare.


Guest Post Comment: Rating the 2016 GOP Presidential Field

I think Reason (Gillespie) did a similar piece, singling out Palin, Trump, and Carson are not serious.

Basketball coaches say that you can't coach height. We can't teach smart, attractive, articulate, and charismatic. I prefer Rand Paul and I also like Paul Ryan (who recently took himself out of the race) and Bobby Jindal. I like any of the three, although Jindal, the only experienced executive of the group, seems to be making an odd play for social conservatives.

I do think Jeb Bush is right: you need a positive agenda. However, I think the successful candidate in 2016 needs to argue change against the Bush/Obama record of domestic and foreign intervention, has to talk about reducing government costs across the board, including DoD; I don't think Jeb can throw his Dad and brother under the bus.

I think what voters will look for in 2016 goes beyond bashing Obama. Avoid divisive issues like anti-immigrant policy (which really hurt Romney in 2012). Talk of a governing partnership; come up with new, fresh ideas. Ideally someone who, like Obama, comes across as unflappable and inspirational, has a sense of humor.

Political Cartoon

Courtesy of Jerry Holbert via Townhall

Musical Interlude: My Favorite Vocalists

Joe Cocker, "The Letter"

2015 State of the Union Address: Critique Part I: The Introduction

First of all, let me acknowledge that many sources have published their own assessment of the State of the Union Address, e.g., Fact Check here, Rand Paul here,and Cato Institute (below). I'll reference excerpts from the CNN transcript available here.

Tonight, after a breakthrough year for America, our economy is growing and creating jobs at the fastest pace since 1999. Our unemployment rate is now lower than it was before the financial crisis. More of our kids are graduating than ever before; more of our people are insured than ever before; we are as free from the grip of foreign oil as we've been in almost 30 years.

Via BEA

First, as FactCheck notes, the most recent numbers in the chart are subject to possible (negative) adjustments. However, notice the sputtering, inconsistent nature of the Obama recovery and compare it to Bush Administration string of 2%-plus GDP string from 2003 to 2006, and Bush's second half of 2003 is arguably superior to Obama's recent 2-quarter string (not to mention some economic activity was likely deferred from a harsh winter first quarter). Unlike Bush, Obama has had near-zero interest rates his entire tenure in office, not to mention multiple rounds of quantitative easing as the recovery started to sputter.

 In George Bush’s first six years GDP rose 16%, but median incomes fell 2%. Under Mr Obama it has been even worse: GDP is up 8% and median income is down 4%, according to the Census Bureau and Sentier Research, a private outfit. Between 2001 and 2007 the median household’s real net worth rose 19%, to $135,400. The collapse of the housing bubble sent it plunging. By 2013 it was $81,200, less than in 1989. In previous recoveries the labour-force-participation rate rose even as unemployment fell; this time, it has fallen.  Many of the jobless end up drawing disability benefits and never return to work, another reason labour-force participation has fallen.

But there is some evidence that the economic recovery has been uneven, in particular, the shale oil/gas boom, largely in spite of vs. because of Obama's policies, despite Obama's implicit implication that increased energy security is the result of his policies. Even with some recently announced adjustments, largely off the East Coast, Obama continues to oppose developing off the blue Northeast and West Coast and many promising Alaskan areas due to environmentalist lobbying. Oil production on federal lands has modestly increased, mostly due to higher-cost oil recovery at higher prices, permits and leases are sharply down from the Bush Administration, in part due to Obama's BP oil spill drilling moratorium, but an aggressive EPA has increased the regulatory burden, even on private and/or state-owned lands, which account for most of the shale output putting America in the lead of oil producing nations. However, the recent price drop of crude, roughly half, is already starting to affect American production with several high-profile oil industry companies lowering capital investments and some smaller companies laying off crews and/or filing for bankruptcy. (Some Austrian economists argue that some of cheap money policy led to malinvestments in the shale oil economy.)

Now perhaps people don't recall the energy-based recessions of the early 80's, but I do, living in Houston and looking for work. And take a look at this chart of state GDP's (see most recent link):

Many of the high-growth blue states like Texas, Oklahoma, and North Dakota, are part of the shale oil renaissance story. But here's another chart I recently republished from the Carpe Diem blog:

And let's point out a few facts familiar to blog readers; even as job losses have been regained since the 2007 recession (never mind we need 100-200,000 jobs gained per month just to accommodate new entrants to the labor force), many of the job gains are lower-wage and/or part-time:

But job losses and gains have been skewed. Higher-wage industries — like accounting and legal work — shed 3.6 million positions during the recession and have added only 2.6 million positions during the recovery. But lower-wage industries lost two million jobs, then added 3.8 million.

And while Obama hypes marginally more graduates, it's not clear for many graduates, that translates to promised higher wages:

About 48 percent of employed U.S. college graduates are in jobs that the Bureau of Labor Statistics (BLS) suggests requires less than a four-year college education. Eleven percent of employed college graduates are in occupations requiring more than a high-school diploma but less than a bachelor’s, and 37 percent are in occupations requiring no more than a high-school diploma. In 1970, fewer than one percent of taxi drivers and two percent of firefighters had college degrees, while now more than 15 percent do in both jobs. About five million college graduates are in jobs the BLS says require less than a high-school education. Past and projected future growth in college enrollments and the number of graduates exceeds the actual or projected growth in high-skilled jobs, explaining the development of the underemployment problem and its probable worsening in future years.

Finally, in terms of health insurance, the numbers are premature given the limited tenure of ObamaCare, payment delinquent policyholders and Obama's lawless deferment of the employer mandate, but it appears most gains have to do with increased eligibility of Medicaid in states accepting the expansion. We've seen contradictory results from different government surveys, and up to 75% of exchange enrollees were previously insured. Not to mention over half the doctors in the largest metropolitan areas don't accept new Medicaid patients and there are some studies (e.g., Oregon) disputing Medicaid patients have better health outcomes. A final note: remember the kaleidoscope accounting where Dems claimed ObamaCare would "reduce" the deficit? An analysis based on CBO adjustments shows "even using the overly optimistic CBO baseline scenario, we now know that Obamacare will increase the deficit over the next decade by $131 billion rather than reduce it by $109 billion."

Tonight, for the first time since 9/11, our combat mission in Afghanistan is over. Six years ago, nearly 180,000 American troops served in Iraq and Afghanistan. Today, fewer than 15,000 remain.

Let me point out that over half the casualties in the Afghanistan war have occurred under Obama's more limited watch, and whereas the combat mission has ended, some 11,000 Americans are staying behind for training and other missions, and the war is hardly over: some 5000 Afghan soldiers have died in combat over the past year. And let us note that Obama makes a misleading distinction of combat troops: for example, just recently Obama has joined the fight against ISIS in Iraq and elsewhere with bombing missions and sent at least 1800 advisers and trainers. Obama isn't discussing his aggressive expansion of drone attacks over a number of states, ongoing issues in Syria and elsewhere.

Miscellany: 1/29/15

Quote of the Day
When small men begin to cast big shadows, 
it means that the sun is about to set
Lyn Yutang

Privatize It!



Remy Is Back: Hashtag Progressivism: #jesuisremy



Senate Approves Keystone Pipeline Project With Democrat Votes: Thumbs UP!



Facebook Corner

(Reason). Taking candy from a baby is easy. Taking sugar from a senator? Not so much.
It's sad to see Marco Rubio, rumored Presidential candidate, who was part of the Tea Party class of 2010, for limited government, free market principles, etc., has consistently voted for his Big Sugar daddies' protectionist policies.

Let's point out with regards to the mercantilist arguments that there is low barrier to enter the sugar industry. There is no rationale for the US to prop up an industry which cannot produce at global prices any more than exclusively foreign sources of bananas or coffee compromise our economic security. We have higher oil production costs than many oil exporters, but given current price, many oil shale plays are not feasible. But there is a narrow spread between supply and demand and only so much supply from lower-cost producers. If we scale back shale operations, that oil isn't going anywhere. America has some of the most fertile cropland in the world, and we have technology for massive economies of scale. Global competition motivates us to innovate and compete in a sustainable manner. We must take world leadership and promote unilateral free trade.

(Reason). Symbolic vetoes are not in the national interest. re: Keystone Pipeline
 Why call this symbolic, as if to belittle the President's use of the veto? There are not enough votes in the Senate to override the promised veto, so why is their vote not being called "symbolic"?
Because it forces the Fascist-in-Chief to stop playing both sides of an issue. There's a political reason he hasn't made a decision to date. The Keystone pipeline is popular with voters, and he's lost at least 6-8 Dems on the vote already. We still import a third of the oil we use. Make no mistake: Obama will pay a political price for a veto.
 At the barrel of oil being so cheap I wonder if the pipeline would still be built.
 A pipeline is a long-term decision. I bet you thought when oil prices crashed in 2008-2009 they would stay down, right? But just a few points: not all Canadian oil is tar sands, and we import a lot of oil from Canada--which has to be transported in some fashion--most not as safe as a pipeline.
 I for one believe that passing laws that specifically benefit one or a few special interests is against the spirit of the Constitution and poor drafting of laws. The executive branch has the ability to veto and this is a bill that should be vetoed. I am all for pipelines, they don't bother me but shouldn't we be drafting laws that will apply for all instances when a company wants to build a pipeline? Oh, that's right, the next big oil pipeline will have to donate to campaign funds of the next batch of lawmakers, how silly of me.
This is exactly the same kind of frivolous bullshit Justin Amash argued. There are standard procedures--which TransCanada has worked through--and Obama has been filibustering a decision. The authority was delegated by Congress and remains with Congress. I specifically challenged Amash to identify a more general bill (no response to date): does he mean a legal detour around the Fascist-in-Chief?
 That pipeline helps Canada more than us and pushes back weaning off from dirty fossil fuels, which should be a national security priority.
Environazis spamming the Reason thread. Pipelines are safer, more efficient means of transport. We already have thousands of pipelines across the US. I shouldn't have to remind people, but we still import a third of the oil we use daily--no doubt the OP would rather we import it from the volatile Middle East and have the Canadians sell to the Chinese and Indians.
Reason, don't let abuse of eminent domain get in the way of this editorial.
"Abuse of eminent domain?" What about the liberty to migrate and rights of way? Apparently your "rights" are "more equal"? Pathetic.
Warren Buffet and his trains will have something to say about this.
http://www.cnbc.com/id/101460011
I wonder how many people are going to be pushed off their land using Eminent Domain. Not very libertarian, is it?
Eminent domain is NOT being used to grab land but to gain an easement--a right of way. This happens all the time involving thousands of miles of pipeline in the US; the pipelines are buried at least 4 feet underground and farmers can plant over them. (Not to mention municipalities running sewer lines and power lines.) Environment fascists are trying to obfuscate the issue; in fact, TransCanada has already entered into voluntary agreements with over 80% of the property owners.

(Reason). From Sarah Palin to Donald J. Trump to Dr. Ben Carson, Republicans just can't get enough of obviously unqualified presidential contenders.
I think the fascination with Palin is her considerable charisma, talent at pithy one-liners and dose of right-wing populism. As for some of the others, I think a lot of the appeal is with people who aren't career politicians, who are part of the problem.

Personally, as a pro-liberty conservative, I like Rand Paul, who is one of the most articulate and uniquely interesting senators. I think Paul Ryan and Bobby Jindal are also highly intelligent and articulate with fresh ideas. Ryan has already taken himself out of the running, but I thought he matched up well against Hillary Clinton.

I do agree the candidates Gillespie mentioned have no chance at the nomination. I think a lot of it is red meat politics, like bashing Obama. However, they have no chance against Clinton and hence will never win the nomination. I think you have to have a positively-toned agenda.

But if you go back to 2008, most Democrats were happy choosing between Barry and Hillary, relatively inexperienced with no compelling policy leadership. Oddly enough, their most interesting candidate over the last few decades was Jerry Brown.

Political Cartoon

Courtesy of Lisa Benson via Townhall

Musical Interlude: My Favorite Vocalists

Joe Cocker, "With a Little Help From My Friends"

Miscellany: 1/28/15

Quote of the Day
Murphy's Seventh Law: Left to themselves, things tend to go from bad to worse.

Image of the Day

Via Rand Paul

Bush, Clinton, Romney      via Rand Paul

Via Reason 

Former LP Presidential Nominee Harry Browne On Real Social Security Reform



Should Government Subsidize Science?

In short, no. For one answer, see here. I'll simply point out here that I don't believe in the central planning of anything, not to mention science, and I think the monopoly and inertia of the State would hamper progress in science.



Facebook Corner

(Cato Institute). See image of the day. Our world is getting better every day. To learn more, follow HumanProgress.org....
That 50 inch HD TV was over $10,000 when it was introduced.
The OP is totally clueless. The point is--who could buy a nearly $9000 TV in 1954. Most middle-class consumers stuck with their black-and-whites. More well-to-do consumers often fund the initial high-cost production runs, paving the way to the mass market.. I paid over $1000 for an early-model VCR, and within a year or two, prices were cut by more than half for improved models.

(Reason).  Elementary school students forced to drop their pants so school administrators can inspect their underwear.
Well, the old saying goes "Always wear clean underwear in case you're in an accident". I guess in modern times we substitute "in case your school thinks it's a prison or the TSA..."

(Sen. Lee, R-UT). Loretta Lynch: "Civil forfeiture is a very important tool."
The first step, Sen. Lee, is not to depend on the discretion of future AG's for civil asset foreiture but to write reform into law. Second, if there is civil asset forfeiture, the presumption of innocence must be for the property holder, not the State.

(National Review). Everyone please stop defending Huckabee or I might do something unforgivable like say a naughty word at my desk.
Oh, really, conservative means libertene? Edmund Burke, the intellectual godfather of conservatism, once wrote: “Manners are of more importance than laws. Upon them, in a great measure, the laws depend.” 

I find it less incongruous for an ordained Southern Baptist minister to object to the use of coarse language than for a National Review columnist to lecture us on ideological feminism and politically correct rhetoric.

There has been a notion of gender differences in communication and behavior, that women are more adept and empathetic in situational context, less likely to engage in aggressive, provocative actions, like the use of coarse language.

Once again, for a number of us, our mothers or typically female elementary school teachers were the ones who reprimanded us on inappropriate use of language, who lectured us on the finer points of etiquette. The point that Huckabee made had more to do with regional, cultural differences than gender.

School Choice in Camden



Things That Make You Say 'Awwwww'



Choose Life



Political Cartoon

Look--It's Robbin' (in the) Hood.... Courtesy of Michael Ramirez via Townhall

Musical Interlude: My Favorite Vocalists

Céline Dion, "Taking Chances". This is her last A/C Top 10 hit. This concludes my Dion series; with the next post, I'll start a series on recently deceased Joe Cocker.

Miscellany: 1/27/15

Quote of the Day
Beginning today, treat everyone you meet as if 
they were going to be dead by midnight. 
Extend to them all the care, kindness, and understanding you can muster, 
and do it with no thought of any reward. 
Your life will never be the same again.
Og Mandino 

Image of the Day

Chart of the Day: Obama and  the Fed Work Their Magical Recovery

Via David Stockman Contra Corner

Choose Life: When Your Mom Is Your Hero

Via LifeSiteNews (my edits):

When he was a young boy, Fr. Mario Majano, 28, used to think a hero was someone out of an action comic book, a “flash, bang, superpower” kind-of-person. As he grew older, Fr. Majano believed a hero to be someone who put themselves in harm’s way for others, he said during the Verizon Center Mass for Life in Washington, D.C.  Fr. Majano related at the January 22 event how he happens to know just such a hero, a woman who “against all obstacles, against all trials, stood firm, and would not budge, would not move from what her beliefs were, when everything else in her life seemed to sway.” 

The first of three major trials came for this woman while she was a high school student and was raped and became pregnant.“Her family just let her be. She felt totally alone, [with] nowhere to go. [She was] practically disowned,” said Fr. Majano. A friend told the woman she “shouldn’t be going through this” and that she “didn’t deserve this” since she did not have any support. “This is impossible for you,” the friend said. “Just take the practical solution. Abort.”The woman said ‘no’ to abortion, and ‘yes’ to life, he said.

For a second time the woman found herself facing a trial, this time with a pregnancy from a man she loved but who had not committed to marriage. The choice she faced was either going to college or having the baby. Her family urged her to abort and not take the risk of raising now two children without a father. They coaxed the woman, offering to “pay for everything.” She said ‘No’ once again.

Thirteen years later, the woman now happily married, found herself facing yet again another trial, becoming pregnant during an intensive regime of chemical treatment for cancer. Doctors despaired of the new life within her. “Because the medication was so strong, there is zero chance that this child will be born normally,” they told her, and suggested abortion as the only way forward. “Normal or not, this is something I cannot, I will not do,” she told them.

 “And to this woman, for her valiant effort, for constantly staying firm, and focusing on her steadfast love for what life is, I simply say: ‘Thank you Mom! Thank you very much!’” [Fr. Majano was the second baby.]

53-year-old Rosa Majano gets an ovation during her son's speech

A Different Type of Charter



The 2015 Index of Economic Freedom



The Battle of the Rants on Greece

One of the interesting things is how a large percentage of high tech and financial professionals/executives are "progressives" (consider how two in the top 2%, Gates and Buffett, are registered Dems; Soros famously underwrites many left-wing initiatives). So this morning's rant in an email subscription was not surprising:

Stocks started the week on their left foot, beginning on Monday with a negative opening that stemmed from a parliamentary election in Greece. Overnight futures traders reacted immediately to the election results by taking the S&P 500 down as many as 13 points. The premise was that if this radical left-wing party, which is opposed to austerity measures imposed by Greece’s financial overlords in the eurozone, were to abrogate its contracts, then the global financial system would collapse and markets would be left in smoking ruins. The facts and reactions were all messed up. The reality is that the austerity measures laid down by the eurozone on Greece are patently ridiculous and have completely failed to help that country arise from its indebtedness and move toward a long-term solution. The people of Greece were just fed up with all the lies and corruption of the political parties that got the country into this mess, and sought a party that might have a backbone, or at least a new potential solution.

A little perspective here. Thornton examines Krugman et al.'s rejection of GOP "austerity":

President Barack Obama has recently released his budget in which he calls for an “end of austerity.” This is an amazing statement from a president whose government has spent the highest percentage of GDP in history and added more to the national debt than all past presidents combined. [My note: he is referring to publicly-held debt, not the $4T-plus in social security reserves.] While the 2009-2012 budgets have been relatively flat, they are still more than 15 percent higher than in 2008 and 75 percent higher than in the previous decade. This four year leap in spending was financed with a $5 trillion increase in the national debt. [It's now more like $7.5T.]

Krugman refers to cuts in government spending. But as Hollenbeck points out there are basically at least three forms of austerity: (1) the high tax/high spend Krugman/Obama model; (2) the high tax/(gimmick) low spend Merkel/IMF model; (3) the low tax/low spend Austrian/"real austerity" model.

Let’s take a closer look at the Merkel form of austerity being implemented in Europe in which governments “plan” to cut their spending and raise tax revenues. Of course, “planned” cuts are not actual cuts. Four years after the crash of 2008, the UK government had only implemented 6 percent of planned cuts in spending and only 12 percent of planned cuts in benefits. In almost all European countries, government spending is higher today than it was in 2008. A new study by Constantin Gurdgiev of Trinity College in Dublin examined government spending as a percentage of GDP in 2012 compared with the average level of pre-recession spending (2003–2007). Only Germany, Malta, and Sweden had actually cut spending. Although several governments have raised tax rates, tax revenues have collapsed in response. The large and growing black markets in Greece, Italy, Spain, and even France are a testament to wrongheaded European tax policies. Current commitments to reign in tax fraud are a joke when tax rates are already at nosebleed levels.

Okay, got it? When tax levels are too Draconian, we see an expanding black market, high levels of tax avoidance/fraud. The way you expand the tax base is to promote low, consistent tax policy. High taxes and regulatory policies smother tiny shoots of economic growth. Where did we see real austerity?

Growth will come from the private sector, and the austerity we need is one that makes the private sector larger than the public sector and one similar to that implemented in 1920 in the United States. In what Thomas Woods calls “The Forgotten Depression of 1920,” the U.S. government cut spending 50 percent and sharply reduced taxes. The public debt was reduced by a third, while monetary policy was kept on hold. The economy recovered quickly (in 18 months) and by 1923 the unemployment rate had fallen below 3 percent.
A more recent example of similar tactics is Latvia which followed a similar strategy in 2009-2010. It cut government spending from 44 percent of GDP to 36 percent. It fired 30 percent of the civil servants, closed half the state agencies, and reduced the average public salary by 26 percent in one year. Government ministers took personal wage cuts of 35 percent, although pensions and social benefits were barely reduced and the flat tax on personal income was left untouched at 25 percent.
The Latvian economy dropped 24 percent in two years, but rebounded sharply in 2011 and 2012 with yearly real growth of over 5 percent. Unemployment hit 20.7 percent in 2010, but has steadily declined to a little over 12 percent today. Because the cuts prompted deregulation, Latvia enjoyed a boom in the creation of new enterprises in 2011. It was able to transition from a bloated construction sector to a vibrant economy of many small- and medium-sized enterprises.

Now let us recall that just over 1 in 5 Greek workers are in the public sector. This comes from John Sfakianakis, a Greek economist:

The expansion of Greece’s huge government sector took decades to create, but its growth in recent years has been particularly striking. Public employment grew by fivefold from 1970 through 2009 — at an annual growth rate of 4 percent, according to a recent academic study by Zafiris Tzannatos and Iannis Monogios.. Over the same four decades, employment in the private sector increased by only 27 percent — an annual rate of less than 1 percent.  In a report last year, the World Economic Forum ranked Greece’s public institutions No. 84 in the world. Germany was 13. Wages in the public sector were on average almost one and half times higher than in the private sector. Government spending on public employees’ salaries and social benefits rose by around 6.5 percentage points of G.D.P. from 2000 to 2009, while revenue declined by 5 percentage points during the same period. The solution was to borrow more. Public sector wages account for some 27 percent of the government’s total expenditures. As the crisis has worsened, Greece has shed some government workers, mostly through retirement, but it has failed to implement a so-called labor reserve law last year, which called for the eventual slashing of 30,000 public sector jobs. According to the country’s national statistical service, since December 2009 the number of people working for the government is down 12 percent. But the number of workers in the private sector has dropped by 55 percent. [This article is from 2012.]

This is from a Reuters piece also from 2012, noting a new target of 40,000:

Athens pledged last year to gradually lay off 30,000 civil servants from an estimated 700,000 public sector employees as part of its bailout deal. Under the failed plan implemented by the previous socialist government, the 30,000 civil servants were supposed to be placed in a "labour reserve", where they would receive 40 percent of their salaries for a year before being laid off. Only 6,500 left, mainly through retirement. Greece has repeatedly fallen behind targets agreed with its lenders,

The Statists always squeal like a stuck pig when it comes to protecting their headcounts, which are wholly paid at the expense of the private sector. Note that at the start of the Great Recession almost all of the first 4.5M people losing jobs were in the private sector. Obama made a priority of "investing" in education (and states were able to work with that in a budget shell game), while he tirelessly promoted government employment, college debt forgiveness as a government hiring perk, and when the private sector seemed to be closing the gap in jobs lost, Obama argued the bureaucrats weren't getting their "fair share" of new jobs. Government employee compensation went largely untouched, and any freezes were limited in duration. Instead of cutting taxes and regulations to spread the recovery around in the real economy, he doubled down on anti-growth measures, claiming we couldn't afford not to steal even more from the economically successful, not that he was at all reluctant to add $7.5T more to the deficit--and counting.

I haven't reviewed the full record of the outgoing administration, except they have attempted to accommodate the IMF/Merkel model of austerity and seem have turned the corner with modest economic growth. This source argues that many structural reforms are behind schedule, and given a high unemployment, sluggish economy, the sheer percentage of unemployed people alone was enough the threaten the incumbent regime's grasp on power in a multi-party election. Let's note that despite improvements, say, in privatizing some State assets, investors have been hesitant because of the emerging economic uncertainty of a left-wing government, which seems to be promising to rehire laid-off government workers, et al. It does seem that the government's priorities were backwards: tax increases first; spending reforms later. What Greece needed was not higher taxes, but lower taxes and regulatory reform along with a sharp knife on public disbursements.

Political Cartoon

Courtesy of Lisa Benson via Townhall

Musical Interlude: My Favorite Vocalists

Celine Dion, "Have You Ever Been in Love"

Miscellany: 1/26/15

Quote of the Day
Never miss a chance to keep your mouth shut.
Robert Newton Peck

New Freedom Caucus in the House of Representatives

Via Justin Amash:

House Republicans Form House Freedom Caucus
“The HFC will represent America's agenda in the House.”
Washington, DC – Members of the House Republican Conference have formed the House Freedom Caucus (HFC) to advance an agenda of limited, constitutional government in Congress. The HFC has adopted the following mission statement:

“The House Freedom Caucus gives a voice to countless Americans who feel that Washington does not represent them. We support open, accountable and limited government, the Constitution and the rule of law, and policies that promote the liberty, safety and prosperity of all Americans.”
The HFC's founding members are Rep. Scott Garrett, Rep. Jim Jordan, Rep. John Fleming, Rep. Matt Salmon, Rep. Justin Amash, Rep. Raúl Labrador, Rep. Mick Mulvaney, Rep. Ron DeSantis and Rep. Mark Meadows.

Camden, NJ: A Case Study in Government Policy Failure



Byron York, As 2016 race begins, GOP faces its Palin problem: Thumbs UP!

Over the weekend I did a brief commentary on two prospective 2016 female Presidential candidates, Carly Fiorina and Sarah Palin,  I should point out that when I wrote these comments (and quite frankly, I was mostly dismissive of their chances) that I was not aware of the recent Freedom Summit in Iowa where both ladies gave speeches; I have not viewed the speeches in question, but apparently Carly Fiorina got rave reviews for hers and I've seen at least a handful of columns (from National Review, the above piece and others) slamming Palin's performance.

This blog has not been a fan of Ms. Palin since around the time of her first disastrous one-on-one national interviews, when I came out and publicly called for McCain to dump Palin and replace her with Romney. I remember writing some speculative posts before McCain on who he might pick: I thought there was a historic opportunity to pick a woman in the aftermath of Obama's narrow victory over Clinton for the nomination and his appalling decision to name as a running mate Joe Biden over Clinton, who had made it clear she was willing to accept the VP slot. I liked someone like Kay Bailey Hutchison, then the senior senator from Texas. I had explicitly considered Palin but quickly dismissed her because of the Troopergate investigation--which was due to report in the middle of the general election campaign; I thought it was insane to risk political scandal in the middle of the campaign, which would drown out McCain's message heading down the home stretch. (The Troopergate incident involved whether Palin had abused her authority as governor in an unsuccessful attempt to get a despised former relative fired as a state trooper.) There were other reasons to question the selection of the first-term governor from a sparsely populated state, the most obvious of which was the fact that McCain was making his 3 decades in Washington (not to mention a 20-year military career) an experience argument against first-term Sen. Barack Obama. How could he use the  experience argument when selecting an even less qualified candidate a 70-year-old's heart beat from the Presidency?

I must admit I enjoyed McCain swerving the press and the Democrats with his selection, and Palin's first 2 speeches (at her speech in accepting the selection in a joint appearance and at the convention) were superbly delivered. It was quite clear the young governor was charismatic, and the ludicrous overreaction to her by the Left had backfired; Obama seemed threatened, comparing his "running" a national campaign against her running Alaska. But then there was this bizarre gap before the campaign released her to do national interviews--and then it became clear. There was the Sarah Palin who argued she had a thick skin, but then she refused to respond to a query about what news sources she used to keep up on national issues. She would later argue that she thought the question was an implicit provocative accusation that Alaskans don't have news media sources, etc. In a world of small stuff, this doesn't even rate; it's far worse when you take offense at a softball question and refuse to answer. And some of the answers were quite defensive and rather dubious, e.g., military knowledge because of a military base in Alaska, trade experience because of a largely unstaffed trade mission. While Palin was very popular on the campaign trail--she often outdrew McCain's own rallies--she was mostly preaching to the choir and not drawing Democrats or independents to the ticket. I futilely pleaded with McCain to dump Palin and replace her with Romney. In part, and this wasn't Palin's fault, she was in the wrong place at the wrong time. The economic tsunami hit just after the GOP convention, and the economy wasn't McCain's strong suit. Palin was performing her 'drill, baby, drill' just as oil prices started correcting in the now accelerating recession.

Of course, the running mate is often sent out to do the red meat attacks on the opposition, and I recall news reports at the time that Palin, who once enjoyed high bipartisan approval ratings after taking on state corruption, was worried that she might lose her Democrat and independent support in her current role if and when McCain lost. To be fair to Palin, I thought McCain was done because in a change election, he wasn't representing the social welfare party. But he didn't help himself by unilaterally suspending his campaign and trying to delay the debates in order to pass TARP legislation. I probably didn't publish it at the time, but I thought he missed a golden opportunity to oppose TARP which would have clearly distanced himself from Bush. The sad thing is that McCain's impulsive decisions also cast doubts about his administrative competence.

Some rifts in the campaign got exposed late in the game, and Palin did a good job playing the victim card, which alienated me further; the Palin camp accused other staffers of trying to pin the election loss on Palin, which was nonsense. I do believe the Palin selection was a bad decision, but McCain was responsible for that and other bad decisions. Nevertheless, the next incident that annoyed me about Palin involved, of all things, Letterman, a typical "progressive" comedian who had told his fair share of Palin jokes. In this case, Letterman used the occasion of Palin with her daughter attending a Yankee game to make a poor taste joke about a promiscuous major league ballplayer having an affair with the Palin daughter. (Sarah's oldest daughter is and was an unwed mother.) The problem was the daughter who attended the game was not oldest daughter, but a barely teen daughter, and Sarah quickly and ludicrously accused Letterman of joking about statutory rape. There's no  question whoever wrote the joke hadn't done due diligence in researching the news story. Don't get me wrong--it was in poor taste to make slut jokes about any Palin daughter. Letterman, realizing what had happened, wanted Palin to come on the show so he could apologize in person, but Palin was having none of it. He finally cut an unconditional apology on the air, and she responded with politically correct rhetoric, still suggesting the joke was about her underage daughter. This bothered me for 2 reasons: first, I don't like a conservative engaging in politically correct rhetoric; second, she should have responded gracefully to the provocation. Implying that Letterman was a sexual pervert because of a badly written joke by himself or staffers was totally unnecessary. It seems to me in her place, the last thing I would have wanted is to give undue attention to a bad joke. I should note that others don't agree with me: they liked Palin putting Letterman on the defensive. As a politician, you expose yourself to ridicule; it comes with the territory. Now personally, I don't republish every Obama joke I see or come up with. My humor is more tongue-in-cheek, plays on words or a touch of mockery. But I would not be picking a fight for 2 weeks over a bad joke. If anything, I might have tried to ad lib about Letterman's premature joking, that the only thing shorter than his audience's applause is his wife's orgasms, etc.

Now one thing I've never doubted is that Sarah Palin is undoubtedly charismatic and has a gift for one-liners and pithy phrases, e.g., the "death panels" for IPAB. I still don't quite understand how she got linked to the Tea Party, given her tax-and-spend record. But moving on to the Iowa speech, you would think that given one of the early forums where many GOP Presidential hopefuls were making an appearance, she would have done her due diligence and crafted a well-drafted, cohesive speech like most of the others. Instead it came across as unfocused, indulgent, anecdotal, meandering stream-of-consciousness ranting about Obama, Clinton, Hollywood, Big Energy, the mainstream media (sometimes in coarse language), and her family. Like I wrote above, I haven't heard it, but apparently the few people who did like the speech were hardcore Palin supporters. I, of course, could never even win an election as dogcatcher (no doubt the fact I've never owned a dog in my adult life would probably work against me), but if I had had a spot at the Summit, I would have talked about the decline of economic freedom under Obama, over $100T in debt and unfunded liabilities, erosion of privacy rights, delegating authority and funding to the states, nonstop military interventions, etc. And I would have given a positively-toned pro-liberty agenda.

Palin is populist, not a conservative, and probably more charismatic than any 2 or 3 other potential candidates put together. But she hasn't quite figured out what to do with her considerable political gifts.

Facebook Corner

(IPI). If state legislation that saved two of four city employee pension funds is overturned, a “catastrophic outcome” awaits retirees and Chicago taxpayers alike.
 the stealing int he middle of the night has destroyed these penions by the corrupt p oliticians. increasing taxes and land taxes on the middle classes to support an already bankrupt and broken system is not the answer. Let it all crumble and default.
Of course, I have no use for the political whores, but the idea that the politicians looted the pensions is absurd populist nonsense. I've repeatedly pointed out that the Illinois pension funds have a spending/distribution problem, and that to sustain these payouts, the employees and the public sector needed to have contributed far more than they have FOR DECADES so the burden didn't fall principally on the shoulders of future taxpayers. Obviously the pension holidays didn't help, but it doesn't address the real causes of why some municipalities have seen pension-related expenses quadruple over the past decade--and that has more to do with an aging government workforce, early retirement eligibility for decades up to a significant percentage of active duty pay, even up to the high 5 or 6 figures (while social security recipients max out at about 30K and have to wait until 62 to be eligible for smaller distributions). 

Also, I dislike the "middle class" being singled out. All taxpayers share the pain. There aren't enough rich people to pay off these claims, even if you stole all their income.
I hope you are not serious. [Not a response to my comments.] My grandfather had a pension for 40 years from Walgreens. Pension need to be invested soundly and contributions need to exceed the money paid out over the life of the pension. It is not that difficult to manage, but it needs to be MANAGED!
As for the private sector: "The percentage of workers in the private sector whose only retirement account is a defined benefit pension plan is now 10%, down from 60% in the early 1980s. About 30% of companies offer a combination of both types.

"Meanwhile, the few employers that still offer traditional pensions - typically industries with a strong union presence, such as the airline and auto sectors - are working overtime to cut deals to either reduce or eliminate their plans.."

One major problem is that public sector actuaries were late to the game of realizing longer retirement lifetimes; another is that private companies have to recognize a far more conservative 4.3% vs. 7-8% pension fund return in the public sector; more conservative returns force employers to kick in more. Furthermore, the PBGC is critically underfunded, and the last time I checked the Teamsters pension fund was only 60% funded.

Remember, a pension fund needs better than 100% funding during boom periods, because pension funds get killed during recessions. If you are only 40-50% funded years after the recession technically ended in June 2009, you are looking at a potential disaster, because more and more people are joining the retirement pool.

Political Cartoon

Courtesy of Michael Ramirez via Townhall

Musical Interlude: My Favorite Vocalists

Céline Dion, "I Drove All Night"