Filed under: Capitalism, Economy, History, Taxes, The United States | Tags: Economist John Maynard Keynes, Economist Russ Roberts, Spending Doesn't Lead to Prosperity
Economist Russ Roberts writing at CaféHayek.com, December 20.
When I was younger, everyone knew that the New Deal had saved the US economy from the ravages of the Great Depression. Everyone knew that Keynes was right—look what had happened when Roosevelt implemented his ideas—the Great Depression ended! Eventually, everyone knew that story was false. The New Deal wasn’t that big and the Great Depression didn’t really end when the New Deal was implemented.
Now everyone knows that World War II ended the Great Depression. Of course, private consumption fell during WWII and the vaunted Keynesian multiplier seemed to only work for the defense industry. Someday, perhaps, people will understand that when a war takes over most of the industrial sector, you don’t get much stimulus. And it’s not hard to reduce unemployment when you force a huge chunk of the male working-age population into the army.
When the war ended, all the Keynesians predicted disaster and a horrible depression because of the cuts in government spending and men coming home from Europe and the Pacific. Well, when that didn’t happen, people should have known that there isn’t a simple relationship between government spending and prosperity. But somehow, people didn’t learn that lesson.
Filed under: Capitalism, Democrat Corruption, Economy, Law, The United States | Tags: General Motors, GM Stock Buyback, United Auto Workers
The long sorry saga of the General Motors bailout is coming to an end. General Motors is buying back 200 million shares of its stock from the government, or about 40% of the government’s holdings of GM stock. The remaining 300 million shares will be sold by March 2014.
By selling the stock and putting GM back in business, the federal governments’ “investment” was a great success, was it not? Not. We were told repeatedly that the GM bailout would not only save jobs, but it might even end up netting the taxpayers a profit.
GM on Wednesday said it will buy back the 200 million share of the government stake for $5.5 billion, or $27.50 a share. Unfortunately the break even point on the government’s total holdings was $53 a share. Now, with $20.9 billion in taxpayer funds left to pay off from the remaining 300 million shares, the break-even point has risen to $69.72 a share.
Back in October, President Obama was bragging about the big comeback of General Motors.
When the American auto industry was on the brink of collapse, I said, let’s bet on America’s workers. And we got management and workers to come together, making cars better than ever, and now GM is No.1. again and the American auto industry has come roaring back.
That’s a valiant attempt to make a silk purse out of a sow’s ears, but it is a poke of exaggerations, half-truths and deceptions — yet it helped to secure Obama’s re-election.
In the 1950s GM owned roughly half of the U.S.car market. By 2006, just before the financial crisis, its market share had fallen to about 24%. In March of this year, according to Ward’s Auto Reports, it hit an all-time low of 16.5 %. Not roaring back, and not exactly No. 1. The nonunion transplants like Hyundai and VW are growing much faster.
As for Obama’s bailout of American workers, it was a taxpayer giveaway to the United Auto Worker’s Union that allied with sloppy management bears the blame for the ills of the auto industry. The $80 billion auto bailout gave the UAW nearly $27 billion because GM could not shed its overly expensive labor contracts, something it could have done in a normal, legal bankruptcy. Obama bailed out the unions, not the auto industry
The UAW and its affiliates give tens of millions of dollars each election cycle, almost entirely to Democrats. Which explains why Obama’s auto czars arranged a government “bankruptcy” for GM flew in the face of hundreds of years of bankruptcy law and violated investor rights. Bondholders took huge losses, while unions got a big chunk of ownership in GM stock to which they had no legal right.
UAW workers at GM kept their pensions as well, but nonunion workers at GM spin-off Delphi lost theirs. This is a Chicago style bailout in which corporate cronies of the Obama White House pocket taxpayer “subsidies” and “green investments”, give executives a raise, and then go belly up. That’s what happens when the spenders think of revenue as “government money” which they are free to distribute in any way that gathers in future votes.
Filed under: Capitalism, Democrat Corruption, Economy, Education, Freedom, Politics, Taxes, The United States | Tags: New York Times Biggots, Rep.Tim Scott (R-SC), SC Governor Nikki Haley
No sooner had South Carolina Governor Nikki Haley announced that she would name Representative Tim Scott to the Senate seat being vacated by Jim DeMint, who is leaving the Senate to become President of the Heritage Foundation, than the insults started. Mr. Scott was first elected to Congress in 2010, and not only has a history in South Carolina politics, but has been a successful small businessman, a real plus in a Congress where that quality is all too rare. He is a staunch advocate for low taxes and the free market, something that does not endear him to Democrats. He has been a favorite of Tea Party activists.
Democrats, always ready to demonize anyone who does not fall in line, have attempted to portray Tea Party members as bigots, racists, and gone to great lengths to attempt to infiltrate Tea Party rallies with racist signs so they can be photographed with the Tea Party in the background, proving that they are indeed racist. Doesn’t work. The NAACP passed a resolution two years ago that condemned ” racist elements and activities” in the Tea Party. The many black members of the Tea Party were not particularly amused. The popularity of Tea Party heroes like Herman Cain and Congressman Allen West should put an end to that nonsense.
Republicans are delighted to have this young black man who won the district in 2010 with 65 % of the vote. Democrats are furious when any black American dares to be a Republican and defy “the narrative.” Trouble is their narrative doesn’t have a very long history. The Republican party was founded as the party of abolition, was responsible for the Emancipation Proclamation, many a station on the Underground Railroad, voting rights laws, the civil rights laws of the Johnson Administration only passed with more Republican votes than Democrats. I know Democrats can’t let go of the race issue, but there are a lot more interesting things about Tim Scott than the color of his skin.
The New York Times printed a disgustingly racist op-ed Tuesday which I will not reprint here, but link to, in case you want to see what a knot they twist themselves into to prove how tolerant they are. “There is little that connects these men to mainstream black politics” — you simply cannot be black and Republican. He even says “All four black Republicans who have served in the House since the Reagan era — Gary A. Franks in Connecticut, J.C. Watts Jr. in Oklahoma, Allen B. West in Florida and Mr. Scott —were elected from majority-white districts. “
Goodness, I thought that was the goal: where these men were elected for the content of their character, not the color of their skin, instead of having to have a district gerrymandered to be majority minority so Black Americans would be sure of being elected. The Democrat Party has a long dismal history of racism, and they can’t seem to get over it, nor imagine a world where skin color is a matter of indifference.
Filed under: Capitalism, Economy, Humor, Taxes, The United States | Tags: 16 Trillion and Growing, A Trillion Dollars A Year, The Debt Limit
A charming little parable to explain the larger situation. Enjoy.
Filed under: Energy, Environment, Global Warming, Junk Science, News the Media Doesn't Want You to Hear, Politics, Russia, Science/Technology | Tags: Russian Winter, Climate Change Dead, A Win For Obama
Russia is enduring the harshest winter in over 70 years, with temperatures plunging as low as – 50° Celsius. Dozens have died from the cold and nearly 150 have been hospitalized. The country has not experienced such a long cold spell since 1938. Temperatures are 10 to 15 degrees colder than normal.
Across the country, 45 people have died in the cold, and 266 have been taken to the hospital. The Moscow region saw temperatures of –17° to –18° Celsius. Thermometers in Siberia have hit –50° which is unusual for what we often think of as one of the world’s coldest regions.
The combination of cold weather and more snow has played havoc with traffic and transportation. Flights have been cancelled across the country.
There are more pictures here. Makes you want to grab another sweater or turn up the heat. What the climate alarmists don’t seem to understand is that warmer weather is generally beneficial. The most perfect climate known to man occurred in the Medieval Climate Optimum, around 900 – 1300 when wine grapes grew in Britain, the Vikings farmed Greenland and the earth bloomed. We can adapt to warmer temperatures, but cold kills.
President Obama, in an interview for TIME’s person of the year issue, as identified climate change as one of his top three priorities in his second term after coming under fire from environmentalists for not doing anything in his first term (a carbon tax, CO2 limits ). Well, not to worry. The IPCC is admitting that CO2 is not a big deal after all. The IPCC admission has the climate world buzzing, but the news hasn’t reached the White House yet.
The models the IPCC uses for its predictions of catastrophic warming have overestimated the climate’s sensitivity to CO2. We can now estimate, based on observations, how sensitive the climate is to forcing from CO2, aerosols and other sources, minus ocean heat uptake. The conclusion suggests that the best observational estimates in decadal-average global temperatures between 1871–1880 and 2002–2011 is this: A doubling of CO2 will lead to a warming of 1.6°– 1.7°Celsius or (2.9° –3.1° F). We can handle that. We do every day.
Academic scientists may be reluctant to admit that what they have been maintaining for many years is wrong. We’ll see. But consider the possibilities. President Obama can claim that the end of the global warming scare took place on his watch. He can quit squandering taxpayer money on windmills and solar shingles, plug-in cars, 500 lb. batteries, and stop shutting down the coal-fired power plants and restore our cheapest source of energy. He can send the environmental activists packing. He’s got a win-win situation there.
Filed under: Capitalism, Democrat Corruption, Economy, Law, National Security, Taxes | Tags: President Barack Obama, Raising Taxes Hurts Growth, Spending is the Problem
The current debate over the “fiscal cliff” is an empty one, built upon a false premise. The debate pretends to be about raising tax rates to solve our current crisis. The claim is that it is the failure to tax the rich, or that the rich have not paid enough to prevent the present crisis.
If President Obama get his way, is proposed tax increases, to make the rich “pay their fair share,” on the top 2% of earners would fund the federal government for about eight days. If we taxed Americans earning over $1 million on 100% of their income, we would raise at best about $600 billion in revenue, which would not make even a significant dent in our over sixteen trillion dollar debt.
Taxing “the rich”is not a real solution, only political game-playing. Every dollar the government takes is another dollar used unproductively. Every dollar removed from the private sector and wasted in the hands of bureaucrats is a dollar that will not fund a payroll, hire someone who desperately needs a job, purchase goods or pay for services.
President Barack Obama has no intention of cutting back on spending. He has solar panels to support, cronies who want to build wind farms, electric cars to support, a “green fleet” to fuel. Or perhaps to hire more employees for the voraciously growing government. It takes some doing to add another trillion to the budget each year. That’s a lot of spending.
The president says we have no time for spending reforms. Increasing the taxes paid by the rich is too important, we must do it right not, and maybe he’ll look at spending a little later. This is what Democrats do. See that big orange bulge? That’s interest on the debt, that’s unreformed entitlements and ObamaCare — did you think ObamaCare was going to cut the cost of health care?
The federal government plans on spending $1 trillion more next year than it did four years ago. If we spent at 2008 levels combined with the revenues of 2012, next year we would have a deficit as small as $89 billion. Was the size of government we had in 2008 not big enough? Was there a vast outcry for more people, more buildings, more bureaucracies?
A serious plan would extend the tax rates we have had for 12 years. That would encourage business because they would know what to expect. They would be able to plan, knowing what their taxes will be. If they could plan, and keep a little more of their own earnings, they might even start to grow and expand and hire workers. That beats squeezing a few more bucks out of “the rich,” the people who invest and build and already pay 70 percent of all taxes.
There is a long history that clearly shows that raising taxes depresses the economy. Democrats just can’t get it through their heads. They want to spend, and to spend more they need more money.
Filed under: Intelligence, Law, Middle East, National Security, Terrorism
The Accountability Review Board study of the Benghazi affair, conducted by a board appointed by Secretary of State Hillary Clinton and led by Adm Mike Mullen and Thomas Pickering, a longtime U.S. diplomat, faulted a “lack of proactive senior leadership” for security in Benghazi, said physical security was “profoundly weak.”
“Americans in Benghazi and their Tripoli colleagues did their best with what they had, which, in the end, was not enough to prevent the loss of lives,” the 40 page report concludes.
Mrs. Clinton had a headache and could not appear before Congress, but said in a letter to Congress that the State Department would increase funding for security in overseas missions, hire more diplomatic security and create a new office focused on high-threat postings.
“It is our responsibility to constantly improve, to reduce the risks our people face, and to make sure that they have the resources they need to do their jobs,” Mrs. Clinton said.
Three State Department officials resigned under pressure Wednesday.
Systemic failures and leadership and management deficiencies at senior levels within two bureaus” resulted in a security level that was “inadequate for Benghazi and grossly inadequate to deal with the attack that took place,” according to the report released late Tuesday by the independent Accountability Review Board.
So there you go. The independent Accountability Review Board has told us exactly what we already knew, three sacrificial lambs have resigned, State will move some funding around. The House and Senate negotiators on the pending defense bill agreed to fund an additional 1,000 Marines for embassy security worldwide. All done, nothing more to see here, just move along on.
Questions about when was the president informed of the attack, and by whom? What actions did he order to be taken? Were his orders carried out? Who decided not to send in military help that was clearly available and able to reach Benghazi in time? Why have the other personnel who were rescued not been available? al is one of the worst to ever smear an American administration. The sacrificial lambs have been fired, and that will be the end of it. Dead Ambassador and technology expert, two former SEALS, we will try “to make sure that our people have the resources they need.”
The Diplomad, a retired State Department official commented on November 12.
Enter Benghazi: Most likely a pretty straightforward story of Islamic terror and incompetence by State, CIA, and the Pentagon, and dereliction of duty by the White House. A true analysis of the Benghazi fiasco would lead to a questioning in the middle of an election campaign of the Obama misadministration’s extravagant claims to have killed Al Qaeda; of its disastrous “Arab Spring” policy; and of its mad delusions about turning Libya into a social-democratic wonderland. Ergo the need to make the affair as complicated as possible. First, a torrent of lies and half-truths flung about by Susan Rice about a silly video clip and a flash mob gone bad. Then a steady effort to rewrite history almost as it happened; careful parsing of words; contradictory and nonsensical briefings by different arms of the intelligence community; and, of course, wrapping oneself in the flag, e.g., the Andrews ceremony, taking “offense” at any questioning of motives. Then make sure that the GOP candidate stays quiet about it; for that, nothing better than giving him “classified” briefings with the caveat “be careful what you say about this or you could screw up sensitive and ongoing operations. You don’t want to be responsible for that, do you?” Then–Pennies from Heaven!–the ultimate distraction, right on cue, an unforeseen gift from Zeus, a massive hurricane! What paltry media attention had gone to Benghazi, now went to examining storm damage, and portraying Obama as savior of the storm-tossed.
Filed under: Architecture, Heartwarming, Music | Tags: Frosty Winds Make Moan, Gloucester Cathedral Chior, Merry Christmas
Filed under: Capitalism, Humor, Law, Politics, Taxes | Tags: Hypocrisy, Tax-Delinquency, The Federal Government
—Some days one is struck by the absolute absurdity of the human race. John Hinderaker of Powerline keeps close track of the corrections published by The New York Times, The Times dutifully publishes a lot of corrections and their prim recitation of getting everything just about totally wrong gets me right in my weird sense of humor.
—Most people are aware that the much vaunted plug-in electric cars are not exactly selling like hotcakes. Their share of the total market is only a pathetic 0.65%. But that’s nothing to compare to the sales of the used EV market. All new cars lose about 20% of their value the minute they roll off the lot, but plug-ins have some specific problems. You don’t get President Obama’s $7,599 bribe on the used ones. The higher retail price is rarely made up in fuel savings over the life of the model. The $40,000 Chevy Volt is basically a $17,000 Cruze with a 500 lb., 25 mi. range, eight-hour-to-charge battery. The big question is how much does a new battery cost? GM claims $8,000-$9,500. Ford say between $12,000 to $15,000. The humor comes in the fact that we’ve wasted more than $6.5 billion in subsidies just since 2008. We are indeed absurd.
—A Muslim country with a 25% slave population is elected Vice President of the United Nations Human Rights Council. The UN human Rights Council met in Geneva on Dec. 12, and elected Mauritania as its Vice-President and Rapporteur for the next year, the second highest position at the world’s top human rights body. According to a recent report by the Guardian, “up to 800,000 people in a nation of 3.5 million remain chattels,” with power and wealth overwhelmingly concentrated among lighter-skinned Moors,”leaving slave-descended darker skinned Moors and black Africans on the edges of society.” Must not criticize a cultural tradition.
—A new report just out from the Internal Revenue Service reveals that thirty-six members of President Obama’s executive office staff owe the country $833,970 in back taxes. A reminder that the best taxers aren’t always the best at being taxed. Federal employees as a group owe a whopping $3.4 billion in unpaid taxes. This includes 1.181 employees of the Treasury Department who are delinquent on a total of $9.3 million in taxes. Bad example from the boss. Tim Geithner had to pay $42,000 in back taxes before his confirmation as Treasury Secretary. Some of the worst offenders are: the Government Printing Office, The Court Services and Offender Supervision Agency, and also —the Federal Reserve Board of Governors. Among the worst of the small department offenders, with only 77 employees, is the U.S. Office of Government Ethics.
Filed under: Conservatism, Cool Site of the Day, Freedom, Fun n Games | Tags: Christmas gifts, conservatives, GOP, Holidays, Reagan, Republicans
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