Friday, July 30, 2010

Democrats Underestimate the American People Once Again

From Michelle Bachmann at Red State:

Clearly, the Democrats think they have something here tying together the Republican Party and the Tea Party. However, it seems to me that this political miscalculation is exactly why Congress’ approval rating is at 11%.
What the Democratic Leadership doesn’t seem to understand is that the Tea Party isn’t a political party; it’s a set of ideas shared by the overwhelming majority of Americans.
The Tea Party is made up of Democrats, Republicans, Independents, Libertarians, Constitution Party members, and apolitical Americans.
They are mainstream folks who love our nation and who wish to see America return to policies of limited government, fiscal responsibility, and strictly adhere to our Constitution. After all, these are the fundamental principles of our founding and represent the character of America.
For the Democrats to portray these fundamental principles as radical and a hindrance to public policy shows just how far out of touch they are from the political pulse of this country.
I hope the Democrats’ latest messaging campaign reaches far and wide because it will do nothing but distance them further from Main Street America.

Why Keynes Was Wrong

From Warren Meyer at Forbes:

I have given up on macroeconomics.

Certainly it is a worthy field of study. But the science is too young, the systems it studies are too complex, and its practitioners are too often politicized for me to take its prescripts seriously in most policy debates.

Last week President Obama visited a new stimulus-funded electric-vehicle battery manufacturing facility in Michigan. The factory produces a product for which there is virtually no market, where worldwide manufacturing capacity already outpaces demand by a factor of three, and whose sales will depend on the government heavily subsidizing its customers.

Nobel prize-winning economist Paul Krugman often writes that only by authorizing much more of exactly this kind of government spending can we pull out of the current recession. Apparently, the way to economic growth is to have the operator of the Post Office, rather than private individuals, invest money. Hearing this, I can't come to any conclusion except that the field of macroeconomics is lost.

My training is not in economics, but in business and management. Perhaps I am biased by my background, which includes 15 years of strategy and planning at large corporations and 10 years running my own business. But my framework for economic growth is a simple one: For growth to occur, someone has to make an investment.

When I use the term “investment,” I am using it rather broadly. Clearly building a new steel mill is an investment. But hiring an additional employee and paying his or her salary ahead of any new revenues is an investment too. Quitting one's job and giving up a regular salary with a large company to start a new business represents an investment as well.

Here is my first law of economic growth: When we encourage more investment, and ensure this investment is being channeled to the most productive uses, growth will follow

For all the talk about fiscal stimulus and jobs creation at the federal and state level, almost no one in government is doing anything about reducing the roadblocks to investment. For example, millions of people are newly unemployed, and in past recessions a large number of these folks have eschewed looking for a new corporate job and have started businesses of their own. Unfortunately, such prospective entrepreneurs will face a tangle of registration, regulatory and licensing hurdles, many of which have been backed by established businesses that want to avoid just this kind of new competition. Even steps like the extension of unemployment benefits tend to discourage such entrepreneurship by increasing the opportunity cost of working for oneself.

No one in government, that I have heard, has even suggested any sort of regulation holiday as a potential economic stimulus program. In fact, most of the legislative moves at the national level have made private investment less attractive. Business people making investments today have to plan for higher labor, energy and borrowing costs due to a series of 2,000-page pieces of legislation that few if anyone fully understand (or have even read). Capital gains tax reductions will almost certainly expire next year, and most business people who look at looming government deficits have to assume these shortfalls will be closed the same way they always have been closed: With new taxes on the backs of the most productive.

Rather than attempting to make investment easier, almost all government stimulus efforts to date have focused on trying to better optimize how and where investment capital is deployed. The core assumption behind all of these programs is that a few people in government can invest money more productively than the private entities from whom the government took the money.

This is frankly an absurd assumption, something I know from my own experience of trying to make just these sorts of capital allocation decisions, though on a much smaller scale. In various corporate strategic planning and marketing roles, I was in the position for years of helping to make investment decisions in some of America's largest and best-managed corporations.

These corporations were smart enough to know that a small corporate staff did not have the information to identify and rank investment choices in their myriad of different divisions. Instead, the corporate office acted as a sort of bank, where front-line managers who had detailed knowledge of individual markets came to the corporation via the planning process and proposed investments. Through my years in this process, I was always convinced we were sub-optimizing, that these divisions if spun off and in control of their own destiny likely would have made better decisions. If smart business people couldn't make confident capital-allocation decisions for a $20 billion business, how can a few career government staffers do better for a $16 trillion economy?

In their hubris, however, the Congress and this administration believe they can do what even the most successful corporations can't. They take money away from individuals and businesses, either in the form of taxes or borrowing that squeezes out private capital, and claim to invest that money better than would have those individuals, despite much worse information and inferior performance incentives. The stimulus bill is an obvious example, but we see this phenomenon all over the country. The bailout of GM effectively poured taxpayer money into an entity that private investors had determined was no longer worthy of investment. Here in the Phoenix area, taxpayers of various municipalities have been asked to subsidize a new shopping mall for $97.4 million, cover a years-worth of our pro hockey team's operating losses for up to $25 million, and throw money at absolutely anyone who whispers the word “solar.”

To every one of the supporters of these government projects who claim to have created some number of jobs, I encourage the reader to ask a simple question--who was using the money before the government diverted it, and how many jobs were they creating?

Warren Meyer is a small-business owner in Phoenix and the author behind the popular Coyote Blog: Dispatches from Small Business.

Pelosi: We want Card Check ASAP

At Hot Air:

Consider this a little reminder for those who seem to have trouble determining whether Nancy Pelosi is a liberal. Having Pelosi announce to a union crowd (here it’s the Communication Workers of America) that she supports Card Check is a little like saying water is wet, which is why Joe Sestak made such a fool out of himself with his tapdance on Pelosi’s agenda. Of course she wants Card Check to become law, and not just for altruistic progressive reasons, either:

Pelosi wants Card Check in order to get unions to increase their membership rolls — and the dues they get to collect. Those dues will mean bigger political contributions, which will mean more money to the Democratic Party. Had the Senate passed EFCA, Democrats may have already started seeing the money roll into their coffers.

It’s a good reminder of the stakes in the midterm elections. A big win in the House will mean an end to EFCA, which would have to be reintroduced in the next session of Congress if the Senate takes no action on it. That’s also a good reminder to be wary of the lame-duck Congress after the midterms, and to keep a close eye on the Senate especially.

Does anyone want to bet where Baron Hill stands on this issue?  Just look at this link and then ask the question!

Stop spending, start cutting

From Cheri Jacobus at The Hill:

Debt. It’s the four-letter word every American knows, hates and fears.

From the time we can comprehend the concept of spending what one doesn’t have and owing more than one can pay, most of us are taught to watch our pennies, spend wisely and frugally and never get ourselves into trouble with debt. From the allowance provided us by our parents, the cash we receive from babysitting or a paper route, to the thrill of our first measly paycheck from our summer jobs, we are taught to respect and know the value of a dollar.

That’s a lesson that seems to have lost its meaning in Washington.

While it’s one thing for Americans to be livid at their elected officials over out-of-control spending and unthinkable levels of debt that will be passed down to children yet to be born, we now have reason to be not only angry, but very, very afraid.

The Congressional Budget Office (CBO) just told us the painful, unvarnished, frightening truth this week — That unless federal spending is reined in dramatically and/or revenues increased, we are headed for certain, sudden economic catastrophe that would make this current economic crisis seem like a day at the beach. The CBO warns we are now in a most dangerous phase of federal spending that, unless slowed down significantly, “will cause debt to rise to unsupportable levels.” Facing projected debt levels of more than $100 trillion, Washington punts, apparently unaware that wishing super hard is not a workable strategy. Likewise, the cable news chatfests barely take notice, as such talk doesn’t score nearly the same ratings as Charlie Rangel’s sleazy ethics scandal (he does need to go, btw) or faux outrage over President Obama skipping a Boy Scouts Jamboree to visit with the ladies of “The View.”

“Increasing revenues” is the phrase to fear. Should a democracy tolerate a government that so cavalierly over-taxes those who invest and create jobs, as well as the middle class, before first and foremost getting federal spending under airtight control? The question is so simple that it borders on boring, as green-eyeshade lectures so often do. We ask and ask and ask, yet Washington simply waits us out, letting the clock run out so they can blame someone else and hope for the next dirty, sexy scandal to distract us.

Where is the courage, the resolve and the conscience of our elected officials that they can’t stop spending and start cutting? Rather than letting tax cuts expire, shouldn’t we let spending expire?

The Tea Party has forced a sharper focus on spending and debt, but rather than listening to them, many in Washington and the media instead demonize them. Many Republicans have sharpened their message in response to this renegade citizen revolt, as have a handful of Democrats. But too many others have dismissed the movement and therefore its message of fiscal sanity. While it is largely Republicans who are benefiting politically from the Tea Party’s growing strength and influence, it is the media of the left and partisan Democrats who, in their attempts to marginalize the movement, may actually be marginalizing themselves.

It didn’t have to be this way.

To continue to be effective, the Tea Party needs to remain untethered and refrain from being co-opted by partisanship. As a Republican, that’s hard to say. As an American, it feels right. Fiscal discipline and recognition of the looming fiscal crash can be embraced by many Democrats, too — and should. Rather than following Sen. Harry Reid’s (D-Nev.) and Speaker Nancy Pelosi’s (D-Calif.) politically polarizing rhetoric denigrating the Tea Party movement, Democrats should break from such shallow leadership and practice true independence. In the House, perhaps a few brave souls with a D after their name should try to join the Tea Party Caucus, recently established by Rep. Michele Bachmann (R-Minn.) It doesn’t have to mean a party switch — just a sincere desire and commitment to prevent a massive economic cardiac arrest.

With the CBO’s dire warnings this week, the most patriotic move for a lawmaker can be to embrace the Tea Party message in order to benefit the nation and our future, rather than just one party in an election year. This new House caucus could be a powerful forum for ideas, discussion and coalition that actually does some good.

It’s certainly worth considering.

Jacobus, president of Capitol Strategies PR, has managed congressional campaigns, worked on Capitol Hill and is an adjunct professor at George Washington University’s Graduate School of Political Management. She appears on CNN, MSNBC and FOX News as a GOP strategist.

Thursday, July 29, 2010

Eight stages of successful social movements

Here is the link to the Eight Stages Of Successful Social Movements, written by a radical for progressives, but something We The People must study and use to make our movement successful.  This has been discussed this week on Glenn Beck.-SP

Check it out here:

Here is the link to Beck's analysis:


Wednesday, July 28, 2010

Our Divisive President

From Democratic pollsters Pat Caddell and Douglas Schoen at The WSJ:

Barack Obama promised a new era of post-partisanship. In office, he's played racial politics and further split the country along class and party lines.

During the election campaign, Barack Obama sought to appeal to the best instincts of the electorate, to a post-partisan sentiment that he said would reinvigorate our democracy. He ran on a platform of reconciliation—of getting beyond "old labels" of right and left, red and blue states, and forging compromises based on shared values.

President Obama's Inaugural was a hopeful day, with an estimated 1.8 million people on the National Mall celebrating the election of America's first African-American president. The level of enthusiasm, the anticipation and the promise of something better could not have been more palpable.

And yet, it has not been realized. Not at all.

Rather than being a unifier, Mr. Obama has divided America on the basis of race, class and partisanship. Moreover, his cynical approach to governance has encouraged his allies to pursue a similar strategy of racially divisive politics on his behalf.

We have seen the divisive approach under Republican presidents as well—particularly the administrations of Richard Nixon and George W. Bush. It was wrong then, and it is wrong now. By dividing America, Mr. Obama has brought our government to the brink of a crisis of legitimacy, compromising our ability to address our most important policy issues.

We say this with a heavy heart. Both of us share the president's stated vision of what America can and should be. The struggle for equal rights has animated both of our lives. Both of us were forged politically during the crucible of the civil rights movement. Having worked in the South during the civil rights movement, and on behalf of the ground-breaking elections of African-American mayors such as David Dinkins, Harold Washington and Emanuel Cleaver, we were deeply moved by Mr. Obama's election.

The first hint that as president Mr. Obama would be willing to interject race into the political dialogue came last July, when he jumped to conclusions about the confrontation between Harvard Prof. Henry Louis "Skip" Gates and the Cambridge police.

During a press conference, the president said that the "Cambridge police acted stupidly," and he went on to link the arrest with the "long history in this country of African-Americans and Latinos being stopped by law enforcement disproportionately."

In truth, the Gates incident appears to have had nothing to do with race—a Cambridge review committee that investigated the incident ruled on June 30 that there was fault on both sides.

Sen. Jon Kyl (R., Ariz.) has said the president told him in a closed-door meeting that he would not move to secure the border with Mexico unless and until Congress reached a breakthrough on comprehensive immigration reform. That's another indication Mr. Obama is willing to continue to play politics with hot-button issues.

Add in the lawsuit against the Arizona immigration law and it's clear the Obama administration is willing to run the risk of dividing the American people along racial and ethnic lines to mobilize its supporters—particularly Hispanic voters, whose backing it needs in the fall midterm elections and beyond.

As the Washington Post reported last week, two top White House strategists, speaking on condition of anonymity, have indicated that "the White House plans to use the immigration debate to punish the GOP and aggressively seek the Latino vote in 2012."

On an issue that has gotten much less attention, but is potentially just as divisive, the Justice Department has pointedly refused to prosecute three members of the New Black Panther Party for voter intimidation at the polls on Election Day 2008.

It is the job of the Department of Justice to protect all American voters from voter discrimination and voter intimidation—whether committed by the far right, the far left, or the New Black Panthers. It is unacceptable for the Department of Justice to continue to stonewall on this issue.

During the 2008 presidential campaign, Mr. Obama's campaign emphasized repeatedly that his minister, the Rev. Jeremiah Wright, was being unfairly stereotyped because of racially incendiary sound bites that allegedly did not reflect the totality of his views. In the Gates incident and others, Mr. Obama has resorted to similar forms of stereotyping.

Even the former head of the Civil Rights Commission, Mary Frances Berry, acknowledged that the Obama administration has taken to polarizing America around the issue of race as a means of diverting attention away from other issues, saying: "the charge of racism is proving to be an effective strategy for Democrats. . . . Having one's opponent rebut charges of racism is far better than discussing joblessness."

The president had a unique opportunity to focus on overarching issues of importance to whites and blacks. He has failed to address the critical challenges. He has not used his bully pulpit to emphasize the importance of racial unity and the common interest of poor whites and blacks who need training, job opportunities, and the possibility of realizing the American Dream. He hasn't done enough to address youth unemployment—which in the white community is 23.2% and in the black community is 39.9%.

Mr. Obama has also cynically divided the country on class lines. He has taken to playing the populist card time and time again. He bashes Wall Street and insurance companies whenever convenient to advance his programs, yet he has been eager to accept campaign contributions and negotiate with these very same banks and corporations behind closed doors in order to advance his political agenda.

Finally, President Obama also exacerbated partisan division, and he has made it clear that he intends to demonize the Republicans and former President George W. Bush in the fall campaign. In April, the Democratic National Committee released a video in which the president directly addressed his divide-and-conquer campaign strategy, with an appeal to: "young people, African-Americans, Latinos, and women who powered our victory in 2008 [to] stand together once again."

President Obama's divisive approach to governance has weakened us as a people and paralyzed our political culture. Meanwhile, the Republican leadership has failed to put forth an agenda that is more positive, unifying or inclusive. We are stronger when we debate issues and purpose, and we are all weaker when we divide by race and class. We will pay a price for this type of politics.

Why Have We Lost Confidence?

From Jay Ambrose at The Orange County Register via RealClearPolitics:

A Gallup poll reveals that only 11 percent of Americans have a great deal of confidence in Congress, and though it's the lowest ranking ever, one wonders what malady afflicts the yea-sayers. Might a review of reality correct their misperceptions?

To do the task justice would require at least as many pages as some of the bills Congress passes, but that itself is a place to start -- mention of a debt-stimulating stimulus bill over 1,000 pages long, of a topsy-turvy health-care remake over 2,000 pages long and of a recent financial-regulation mishmash also over 2,000 pages long.

Members of Congress maybe have some study-guide notion of what's in these bills, but no grasp of all the possible catastrophes hidden in multiple unread clauses. Passing them is therefore akin to the blindfolded racing of a bus down a busy highway. The public -- the passengers -- knows even less, of course, and has to guess at what might happen to it.

At least some of the devilish details do emerge in time, and so you learn that even if an $862 billion stimulus was defensible in theory, the political handouts got out of hand, virtually ensuring any assault on the recession would be feathery at best.

The health bill, it turns out after inspection by various nonpartisan groups since its enactment, was pretty much a fraud from beginning to end. It's going to control health costs? Just the opposite, and here is more bad news -- this fiercely expensive entitlement comes on top of old entitlements -- Social Security, Medicare and Medicaid -- that already threaten to help create fiscal chaos and uncontrollable debt in not so many more years.

Our economy is hugely at risk, and Congress did this to us. Every half-alert Washington denizen has known about the entitlement risk for many years now, but most members of Congress have been afraid to take on the restructuring that's necessary to keep the programs and economy intact. Whenever anyone has made so bold as to suggest a workable solution, it has been demagogue time, time to suggest a willingness to make old people eat dog food when nothing of the sort was remotely possible.

The flimflam has been little short of malevolent, considering the widespread hurt that forestalled fixes could conceivably entail.

So what are we going to do about this fine mess Congress has gotten us into? Look to Congress to get us out of it? Of course not. So worried are Democrats about what the five-year numbers will show, we aren't even going to get the usual budget plan this year, and President Barack Obama has so little faith in Congress tackling the issue that he is looking instead to a commission to come up with answers.

At the same time, of course, these pretend protectors act as if they are oh, so vigilant on the citizenry's behalf. Why look at them when they conduct televised hearings in their mucho Mussolini style, so stern, so mean, so ludicrously pompous. You might never guess they did their bit to give us the recession and the BP oil spill. Congress, you know, didn't just abide dangerous financial practices by Fannie Mae and Freddie Mac. It encouraged them. And its oversight of the Minerals Management Service in charge of drilling permits was practically nonexistent.

There are some really, truly fine members of the House and Senate, to be sure, but then there are those who are corrupt to the point of ethics-panel action and many more whose corruption is of the dirty-deal-but-legal kind. There's the campaign-trail complaint Washington is broken by those who are breaking it. There's the disregard for the Constitution and traditional rules. There's the ignorance and lousy leadership. There is the irresponsibility, the cowardice, the egotism, the hubris, the willingness to put self above the common good not just every now and then, but as a way of life.

Come on, you 11 percent. Wake up.

Tuesday, July 27, 2010

How Smart Are We?

From Thomas Sowell at RealClearPolitics:

Many of the wonderful-sounding ideas that have been tried as government policies have failed disastrously. Because so few people bother to study history, often the same ideas and policies have been tried again, either in another country or in the same country at a later time-- and with the same disastrous results.

One of the ideas that has proved to be almost impervious to evidence is the idea that wise and far-sighted people need to take control and plan economic and social policies so that there will be a rational and just order, rather than chaos resulting from things being allowed to take their own course. It sounds so logical and plausible that demanding hard evidence would seem almost like nit-picking.

In one form or another, this idea goes back at least as far as the French Revolution in the 18th century. As J.A. Schumpeter later wrote of that era, "general well-being ought to have been the consequence," but "instead we find misery, shame and, at the end of it all, a stream of blood."

The same could be said of the Bolshevik Revolution and other revolutions of the 20th century.

The idea that the wise and knowledgeable few need to take control of the less wise and less knowledgeable many has taken milder forms-- and repeatedly with bad results as well.

One of the most easily documented examples has been economic central planning, which was tried in countries around the world at various times during the 20th century, among people of differing races and cultures, and under government ranging from democracies to dictatorships.

The people who ran central planning agencies usually had more advanced education than the population at large, and probably higher IQs as well.

The central planners also had far more statistics and other facts at their disposal than the average person had. Moreover, there were usually specialized experts such as economists and statisticians on the staffs of the central planners, and outside consultants were available when needed. Finally, the central planners had the power of government behind them, to enforce the plans they created.

It is hardly surprising that conservatives, such as Prime Minister Margaret Thatcher in Britain and President Ronald Reagan in the United States, opposed this approach. What is remarkable is that, after a few decades of experience with central planning in some countries, or a few generations in others, even communists and socialists began to repudiate this approach.

As they replaced central planning with more reliance on markets, their countries' economic growth rate almost invariably increased, often dramatically. In the largest and most recent examples-- China and India-- people by the millions have risen above these countries' official poverty rates, after they freed their economies from many of their suffocating government controls.

China, where famines have repeatedly ravaged the country, now has a problem of obesity-- not a good thing in itself, but a big improvement over famines.

This has implications far beyond economics. Think about it: How was it even possible that transferring decisions from elites with more education, intellect, data and power to ordinary people could lead consistently to demonstrably better results?

One implication is that no one is smart enough to carry out social engineering, whether in the economy or in other areas where the results may not always be so easily quantifiable. We learn, not from our initial brilliance, but from trial and error adjustments to events as they unfold.

Science tells us that the human brain reaches its maximum potential in early adulthood. Why then are young adults so seldom capable of doing what people with more years of experience can do?

Because experience trumps brilliance.

Elites may have more brilliance, but those who make decisions for society as a whole cannot possibly have as much experience as the millions of people whose decisions they pre-empt. The education and intellects of the elites may lead them to have more sweeping presumptions, but that just makes them more dangerous to the freedom, as well as the well-being, of the people as a whole.

Public Service Annoouncement: How to remove your Obama bumper sticker.


Monday, July 26, 2010

Bus trip from Seymour to Glenn Beck Rally.


If you want an overnight bus trip to Glenn Beck’s Restoring Honor (Aug. 28), act quickly: (Thanks to Ron.)

Bus reserved for this rally. Holds 54 people, 13 seats sold.

Leave Seymour, Shops of Seymour(Tanger Mall) at 6:00P Friday August 27th,

Arrive Washington D.C. with drop off near Lincoln Memorial Saturday the 28th around 8 or 9AM.

Leave Washington D.C. 6:00P - Pickup location not determined at this time, my instructions to the Bus line were as close to the Lincoln Memorial as possible. Actual pickup place and time to be determined as soon as I can talk to bus driver.

You will be informed prior to arrival.

Arrive Seymour, Sunday 29th around 7 or 8AM.

Price: $125.00 per seat

You may leave your vehicle at the Shops of Seymour Outlet. I will need vehicle description and License Plate number for Seymour Police Dept. and Shops of Seymour operational personnel.

You may purchase your seat by contacting Global Travel, 117 W. 2nd St., Seymour, In. 522-8395. All seats must be purchased by July 23rd, 2010. For any other questions contact Brent Goben 812-528-0789 or

There will be a stop for driver exchange, food and beverage will be available at this location for purchase.

Bring a small pillow, and lap throw for the trip. You may bring your own snacks and drinks on the bus, there will be room in the luggage compartment for any signs, flags, etc. you wish to have at the rally. According to Beck this will be the last public demonstration (rally) allowed at this location per Washington DC authorities.

As it stands now we have 31 people signed up to go, need 23 more by Tuesday the 27th of July at 1:00P. If I don't have enough people signed up by then the trip will be cancelled, everyone will get there money back. I'm on the hook for 54 seats at $125 per. The 27th of July is the last day I can cancel and people get there money back.

Thanks for the interest.


Sunday, July 25, 2010

We The People Indiana "Get Invloved" Meeting in Columbus.

From Lisa Deaton at

On another matter, WTPI will be holding a “Get Involved” expo (for a lack of a better term) on July 30 beginning at 6:30 pm at the Columbus Airport.

WTPI is inviting local area patriot groups to set up a table and promote their group. There may be people attending our meetings that would like to also be involved with your group. There will also be campaigns there to who are seeking volunteers, our local County Clerk who will be taking sign ups to work the polls in November, Right to Life group etc.

I am trying to get people to become more involved then they are currently. Would you like to be a part?

WTPI is making a poster that would briefly show what we have been doing and where we are going the rest of this year with a sign up sheet. Nothing special. Let me know if you are interested.

The following groups will also be there representing the local tea party….North Vernon, Brown County and Franklin areas


07.30.10 We The People Indiana – Monthly Meeting

Get Involved Expo

Columbus Airport

4770 Ray Boll Blvd

Columbus, IN

6:30 P.M.

It's time to "Get Involved" and here is a great opportunity in our area!!-SP

Obama's Soft-Core Socialism

From Steve Forbes:

A comedian or satirist could not have come up with the recent scenario of Treasury Chief Timothy Geithner and other Administration officials suddenly trying to reassure corporate chieftains that the Obama Administration is pro business and loves free enterprise. A close and powerful Obama aide, Valerie Jarrett, sent Verizon CEO (and Business Roundtable chairman) Ivan Seidenberg a letter declaring: "While we may disagree on some issues, we have an open door and are always willing to consider input and ideas from everyone, including the business community." That's like Dracula saying he prefers bottled water to blood.

Consider the letter's condescending tone regarding the Administration's open door extending even to the "business community." The business community employs 110 million workers. Companies and the people who work for them pay most of Uncle Sam's taxes. They are the font of the innovations that enable us to enjoy an ever improving standard of living. Now the Administration deigns to entertain input from the business community! How wonderfully nice and tolerant of the Obamaites to do so.

No sooner had the charm offensive been launched than the government showed its true colors by defiantly reimposing a ban, which had been overturned by a federal court, on deepwater drilling in the Gulf of Mexico and by straight-facedly proclaiming that all the stimulus spending has saved or created upwards of 3.6 million jobs and is a huge success.

The truth is that not even the Franklin Roosevelt Administration was as hostile to and ignorant about free enterprise as this Administration is. Almost every action Obama officials take underscores their belief in the stereotype that businesspeople are mostly amoral, corner-cutting, consumer-shafting, pollution-loving menaces. The economy itself needs to be tightly controlled and rigidly guided by Washington mandarins because free markets are inherently and destructively unstable.

One hesitates to bring up the economics of Benito Mussolini and his ilk because fascism means ugly nationalism and racism, as well as mass murder and aggressive war. So let's label the economic part of that ideology as neosocialist, corporatist, statist or--to be sophisticated and use a French word--dirigiste.

Under the corporatist state, private companies exist but take their direction from government. Competition is seen as wasteful and destructive and therefore must be "managed." There is a basic hostility toward small businesses precisely because there are so many of them, making them harder to regulate and more apt to do things without government permission.

Statism certainly creates a facade of stability, but in the name of such harmony innovation is stifled. This, for instance, is what is damaging Japan. It is almost a cultural imperative there to not stand out. It's no coincidence that the most dynamic, successful post-World War II industry, automobiles, was the one that refused to take guidance from the all-powerful Ministry of International Trade & Industry. The result was a ferocious dog-eat-dog competition in the domestic market as numerous companies clawed for market share. That's why Japanese companies, once they got their products up to U.S. standards, were able to storm the American market when the energy crisis hit in the early 1970s.

The closest the U.S. came to adapting dirigiste economics was during the first two years of FDR's New Deal with the National Recovery Administration. The NRA had businesses set up industrywide cartels to regulate prices, wages and the rules of competition. Thankfully the Supreme Court threw out this fascist edifice early on.

Now, in the midst of another economic crisis (and one not nearly as severe as that faced three-quarters of a century ago), Washington is at it again, this time with a far more ideologically rigid President than FDR. Incrementalism and the velvet glove over an iron fist are Obama's preferred methods. Thus, it will take several years for surviving health care companies to become full-fledged vassals of the federal government, which will dictate what policies are offered and at what prices. The new financial "reform" bill is taking the same approach--its language is intentionally vague in order to give bureaucrats enormous discretionary powers.

On the housing front almost every new mortgage written is now being guaranteed by the federal government in one way or another. The irresponsible and slovenly practices that helped create the housing disaster continue: Recently the Senate turned down a proposal that the FHA require borrowers to make a minimum down payment of 5% in order to qualify for an FHA-guaranteed mortgage (currently the minimum is 3.5%).

If the Administration has its way, Washington's tentacles will extend over the entire economy.

The President tipped his hand early on in his presidency when he implored young people to pursue careers in government instead of in the private sector. He made it clear that those who enter private companies are succumbing to greed and selfishness, while those who become bureaucrats--"public servants"--are somehow more noble and more concerned with the public good.

But there's a bigger problem here than an intense dislike of commerce. The Administration thinks of large companies as being the business community. But they are only a part of it--and certainly not the most dynamic and innovative piece of it.

The contempt for small business was aptly summarized by Hillary Clinton back in 1993, when she was pushing her plan to nationalize health care. Told that her proposals would devastate small companies, she replied: "I can't be responsible for every undercapitalized small business in America."

For cosmetic political reasons the Administration will in the coming weeks try to portray itself as the friend of small enterprise, proposing a bunch of tax credits and other goodies. But these things will be mere Band-Aids for the hemorrhaging these entities are experiencing. Most are taxed at personal rates; thus the higher tax levies coming in January from the expiration of the 2003 tax cuts and the expenses incurred as the new health care stipulations go into effect will drive many companies with tiny profit margins off the cliff.

Small business' woes don't stop with taxes. Bank regulators and examiners are continuing to apply de facto mark-to-market accounting to institutions making loans to small businesses, which inhibits lending. And, of course, all companies face crushing new regulations soon to spring forth from the thousands of pages in Obama's health care and financial reform bills. The health care legislation was specifically designed to make life harder for single practitioners and small clinics. The Administration figures it's much easier to control an industry in which medical personnel and concerns are herded into larger entities.

Rhetoric and smiles to the contrary, this Administration remains resolutely statist and, when it comes to free markets, clueless.

If you grasp Obama's fundamental statist economics then you'll appreciate the face-slap that noted national security strategist/political pundit Charles Krauthammer recently delivered to Republicans who are giddy over the prospect of outsize gains in November's election. In a column entitled "Obama's Next Act" Krauthammer bluntly concludes, "For Obama, [those elections] matter little." Why? Because Obama has achieved his goal of putting this country on the trajectory to a bankrupting, innovation-smothering, western-Europe-like welfare state.

"Obamacare alone ... has put the country inexorably on the road to national health care and, as acknowledged by Senate Finance Committee Chairman Max Baucus but few others, begun one of the most massive wealth redistributions in U.S. history."

And, sadly, there is much more. The financial reform bill "will give the government unprecedented power in the financial marketplace." Whether it will prevent future financial crises is, from a government power standpoint, beside the point.

"But Obama's most far-reaching accomplishment is his structural alteration of the U.S. budget. The stimulus, the vast expansion of domestic spending, the creation of ruinous deficits … are not easily reversed." Which means huge tax increases--including a value-added tax--are in the offing to prevent a Greece-like financial collapse.

If Obama gets a second term, Krauthammer warns, look for "massive regulation of the energy economy, federalizing higher education [the process has already been started with the nationalization of the student loan program], 'comprehensive' immigration reform (i.e., amnesty)." Here's the reason Obama is so serene about his party taking a midterm drubbing: "If Democrats lose control of one or both houses, Obama will have an easier time in 2012, just as Bill Clinton used Newt Gingrich as the foil for his 1996 reelection campaign."

Sobering stuff. But Obama's victories are reversible if Republicans use imagination and get back their ideological moorings. Whatever Obama may think, most Americans hate his binge spending and won't tolerate any big tax boost. This deep, intense feeling could provide the political opening to do things in the U.S. that should have been done years ago. The flat tax, for instance, would enormously reduce Washington's powers, as well as stimulate private-sector growth. Prior to the economic crisis, almost half the lobbying in Washington revolved around manipulating the tax code. Complexity is a major source of power and contributors.

Putting in personal 401(k)-like accounts (with proper rules about diversification) to replace Social Security for people under the age of 50 would phase out another gargantuan source of Washington's political power. Unlike the tepid ideas originally bandied about by George W. Bush, these accounts should receive the majority of an individual's payroll taxes and the matching contributions from employers. That would mean payment for current and about-to-be beneficiaries would have to come out of general revenues. This is going to happen anyway because there is nothing in the Social Security trust fund except a bunch of nonmarketable Treasury IOUs--the money has been spent.

The same approach could be taken with Medicare: enact the equivalent of Health Savings Accounts for younger workers. As for current beneficiaries, they could be given the choice of staying with Medicare or going into an HSA-type system in which a couple's account would receive, say, $10,000 a year for noncatastrophic expenses and in which all catastrophic illnesses would be covered, with reasonable caps on the amount that beneficiaries would be liable for each year.

There would also be genuine popular support for more free enterprise in the rest of health care. Entrepreneurs would do here what they've done everywhere else in the economy--create more supply, more cheaply, to meet demand. Innovation would flourish. There are a number of ideas to help bring this about: the freedom to shop nationwide for health insurance, allowing the same tax treatment for individuals and companies buying health insurance, tort reform and removing the restrictions on individuals and small companies pooling together to purchase less costly insurance.

Krauthammer's grim picture need not come to pass--nor will it if free-market activists take his warnings to heart.

Saturday, July 24, 2010

Your money? The government’s “income”

From RedState:

There was an interesting comment made on the floor of the United States Senate yesterday.

I first noticed in from Senator Jim DeMint’s twitter feed. DeMint tweeted, “Sen. Dorgan just said a vote for tax cuts is a vote to ‘reduce this country’s income. To Democrats, it’s the government’s money. Not yours.”

Really? I mean it wouldn’t surprise me, but we rarely hear the Democrats speak so bluntly about it. But sure enough, here is the rush transcript from the floor yesterday from 4:36 p.m.:


You can watch it here.

Really Senator Dorgan? Voting to give Americans back their own money was a vote to “reduce this country’s income with the biggest benefits going to the wealthiest Americans?”

Certainly cutting taxes reduces the governments’ income in a static calculation, but we also know that revenue into the treasury went up after those tax cuts.

The Democrats really do think it is their money

Pelosi Protest in Louisville Monday!

Evidently Nancy Pelosi will be making an appearance in downtown Louisville on Monday morning, July 26.

This is from Tony Brown from the Harrison County TEA Party folks:

The Louisville Tea Party is planning a "welcoming rally" for Pelosi on Monday, July 26, at the Kentucky Convention Center at 3rd and Market Streets. We will be meeting at the Convention Center that morning between 7:30-7:45 AM; Pelosi speaks around 8:30 AM. The only info I have at this time is you can bring signs, etc. and walk on the sidewalk around the Center or drive around the block in your vehicle with signs, posters, flags, etc., blowing your horn. Just look for some of us and then decide what you wish to do.

Friday, July 23, 2010

The Tax Tsunami On The Horizon


Fiscal Policy: Many voters are looking forward to 2011, hoping a new Congress will put the country back on the right track. But unless something's done soon, the new year will also come with a raft of tax hikes — including a return of the death tax — that will be real killers.

Through the end of this year, the federal estate tax rate is zero — thanks to the package of broad-based tax cuts that President Bush pushed through to get the economy going earlier in the decade.

But as of midnight Dec. 31, the death tax returns — at a rate of 55% on estates of $1 million or more. The effect this will have on hospital life-support systems is already a matter of conjecture.

Resurrection of the death tax, however, isn't the only tax problem that will be ushered in Jan. 1. Many other cuts from the Bush administration are set to disappear and a new set of taxes will materialize. And it's not just the rich who will pay.

The lowest bracket for the personal income tax, for instance, moves up 50% — to 15% from 10%. The next lowest bracket — 25% — will rise to 28%, and the old 28% bracket will be 31%. At the higher end, the 33% bracket is pushed to 36% and the 35% bracket becomes 39.6%.

But the damage doesn't stop there.

The marriage penalty also makes a comeback, and the capital gains tax will jump 33% — to 20% from 15%. The tax on dividends will go all the way from 15% to 39.6% — a 164% increase.

Both the cap-gains and dividend taxes will go up further in 2013 as the health care reform adds a 3.8% Medicare levy for individuals making more than $200,000 a year and joint filers making more than $250,000. Other tax hikes include: halving the child tax credit to $500 from $1,000 and fixing the standard deduction for couples at the same level as it is for single filers.

Letting the Bush cuts expire will cost taxpayers $115 billion next year alone, according to the Congressional Budget Office, and $2.6 trillion through 2020.

But even more tax headaches lie ahead. This "second wave" of hikes, as Americans for Tax Reform puts it, are designed to pay for ObamaCare and include:

The Medicine Cabinet Tax. Americans, says ATR, "will no longer be able to use health savings account, flexible spending account, or health reimbursement pretax dollars to purchase nonprescription, over-the-counter medicines (except insulin)."

The HSA Withdrawal Tax Hike. "This provision of ObamaCare," according to ATR, "increases the additional tax on nonmedical early withdrawals from an HSA from 10% to 20%, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10%."

Brand Name Drug Tax. Makers and importers of brand-name drugs will be liable for a tax of $2.5 billion in 2011. The tax goes to $3 billion a year from 2012 to 2016, then $3.5 billion in 2017 and $4.2 billion in 2018. Beginning in 2019 it falls to $2.8 billion and stays there. And who pays the new drug tax? Patients, in the form of higher prices.

Economic Substance Doctrine. ATR reports that "The IRS is now empowered to disallow perfectly legal tax deductions and maneuvers merely because it judges that the deduction or action lacks 'economic substance.'"

A third and final (for now) wave, says ATR, consists of the alternative minimum tax's widening net, tax hikes on employers and the loss of deductions for tuition:

• The Tax Policy Center, no right-wing group, says that the failure to index the AMT will subject 28.5 million families to the tax when they file next year, up from 4 million this year.

• "Small businesses can normally expense (rather than slowly deduct, or 'depreciate') equipment purchases up to $250,000," says ATR. "This will be cut all the way down to $25,000. Larger businesses can expense half of their purchases of equipment. In January of 2011, all of it will have to be 'depreciated.'"

• According to ATR, there are "literally scores of tax hikes on business that will take place," plus the loss of some tax credits. The research and experimentation tax credit will be the biggest loss, "but there are many, many others. Combining high marginal tax rates with the loss of this tax relief will cost jobs."

• The deduction for tuition and fees will no longer be available and there will be limits placed on education tax credits. Teachers won't be able to deduct their classroom expenses and employer-provided educational aid will be restricted. Thousands of families will no longer be allowed to deduct student loan interest.

Then there's the tax on Americans who decline to buy health care insurance (the tax the administration initially said wasn't a tax but now argues in court that it is) plus a 3.8% Medicare tax beginning in 2013 on profits made in real estate transactions by wealthier Americans.

Not all Americans may fully realize what's in store come Jan. 1. But they should have a pretty good idea by the mid-term elections, and members of Congress might take note of our latest IBD/TIPP Poll (summarized above).

Fifty-one percent of respondents favored making the Bush cuts permanent vs. 28% who didn't. Republicans were more than 4 to 1 and Independents more than 2 to 1 in favor. Only Democrats were opposed, but only by 40%-38%.

The cuts also proved popular among all income groups — despite the Democrats' oft-heard assertion that Bush merely provided "tax breaks for the wealthy." Fact is, Bush cut taxes for everyone who paid them, and the cuts helped the nation recover from a recession and the worst stock-market crash since 1929.

Maybe, just maybe, Americans remember that — and will not forget come Nov. 2.

Thursday, July 22, 2010

Dem Plan to Cut Deficit Will Pay for Failed Stimulus … by 2130

From Heritage:

Reps. Gary Peters (D-MI), John Adler (D-NJ), Peter Welch (D-VT) and Jim Himes (D-CT), should be commended for forming their new Spending Cuts and Deficit Reduction Working Group.

Peters told The Macomb Daily: “Congress has to get serious about reducing the deficit now. Transforming the deficits generated over the past decade back into the surpluses of the 1990s will take rooting out and slashing wasteful spending. We have formed this work group to seek areas to cut billions in unwarranted spending and subsidies.” Huzzah!

To that end the group has identified wasteful discretionary spending, subsidies and tax loopholes from the departments of Energy, Treasury, Housing and Urban Development, Defense and Agriculture that will cut a total of $72 billion from the deficit over ten years. Not a bad start.

But each of these representatives also voted for President Barack Obama’s $862 billion economic stimulus package … a 100% deficit spending-funded measure that has completely failed to meet the Obama administration’s own objective benchmarks. It will take almost 120 years of these cuts just to undo the damage to deficit caused by President Obama’s failed stimulus.

And that does not even get into the real threat to our nation’s bottom line: entitlement spending on Social Security, Medicare, and Medicaid — a threat made much, much worse by Obamacare (which Peters, Welch, and Himes all voted for, by the way).

Obama's Lack of Faith

From David Harsanyi at Reason:

It's time to start trusting the American people

With midterm elections approaching, President Barack Obama has gone on the charm offensive, claiming Republicans are demonstrating a "lack of faith in the American people."

"Faith" often is defined as "having confidence or trust in a person or thing." In this case, though, faith means adding another $35 billion in unemployment benefits to the infinite intergenerational tab—sometimes referred to as the budget—and mailing out as many checks as possible before Election Day.

Yet the jab is revealing in other ways. To begin with, what mysterious brand of public policy has Obama employed that exemplifies this sacred trust between public officials and the common citizen?

Was it the administration's faith in the wisdom of the American parent that persuaded it to shut down the voucher program in Washington, D.C., and continue the left's decades-long campaign denying school choice for kids and parents? Or was that just faith in public-sector unions?

Was faith in American industry behind the Democrats' support of a stimulus bill that was predicated almost entirely on preserving swollen government spending at the expense of private-sector growth?

Is this hallowed faith in the citizenry also what compels the administration to dictate what kind of car we will be driving in the future, what kind of energy we will be filling these "cars" with, and what amounts of that energy will be acceptable?

Is faith in American know-how why Washington funnels billions of tax dollars each year to its hand-picked industry favorites rather than allow the best and brightest to—please pardon the pun—organically figure out what the most sensible energy policy is, as we have in every other sector?

It must be that deep confidence in conscientious Americans that persuades the left to fight against the rights of gun owners who want nothing more than to defend life and property.

The same faith in Americans surely precipitates the administration's defense of censorship (even book banning) to ensure that the citizenry is protected from the despicable reach of political ads funded by corporations. People, you see, are too gullible and too uninformed to withstand the force of Fox News—much less Wal-Mart.

Similarly, that faith has led to the 20-year explosion of paternalistic regulations (often with the help of Republicans) that propose to regulate everything from the size of candy to tanning salons to fast-food restaurants to the pressure in your shower head. A faith that the American citizen has the self-control of a deprived toddler.

It was faith in the American people that led to health care legislation that denies you the right to buy insurance outside of state lines or have any useful portability or even enjoy the same tax break that corporations are afforded. The left has so much faith in Americans that it has to force you to purchase a government-approved plan.

One only needs to propose the idea that citizens be allowed to allocate portions of their Social Security retirement funds—extracted from their paychecks and deposited in faith-based government accounts—to witness the level of faith many on the left have in your decision-making abilities.

Republicans may not have faith in the American people, but in this instance, Obama probably is confusing faith in people with faith in power. Because as hard as one tries, it is difficult to find any instances of choices expanding under this administration. That's the true test of confidence in the citizenry.

Then again, progressives regard government as a moral enterprise. And in church, you gotta have faith.

David Harsanyi is a columnist at The Denver Post and the author of Nanny State. Visit his website at

Wanted: A Republican Vision

From Mark McKinnon at The Daily Beast:

The party's chances of retaking Capitol Hill this fall may be surging. But Mark McKinnon argues they don't have a prayer in 2012 unless they start offering voters some substance.

Republican prospects of taking control of the House of Representatives in November, and to gain ground in the Senate and with governorships, look healthy. But many of my GOP colleagues are suffering from a delusional drunk if they think our luck will run on through 2012.

Sunday on Meet the Press, Sen. John Cornyn, chairman of the National Republican Senatorial Committee, and Rep. Pete Sessions, chairman of the National Republican Congressional Committee, fired blanks when asked what the GOP would do differently than Barack Obama or even fellow Texan George W. Bush.

Time for the GOP to listen to Ryan and crank up the ideas machine. Or get used to four more years of Obama.

When pushed by David Gregory for specific examples of the policies Republicans would pursue to reduce the deficit, Cornyn looked uncomfortable and unprepared. His response: “’No’ is a good start.” Sessions didn’t shoot any better. His sound bite, “We need to go back to the exact same agenda,” is already a punch line in a Democratic National Committee video online.

“Just Say No” is a short-term strategy that may work for November. Though Cornyn is right that the Democratic monopoly on the federal government is scaring the living daylights out of folks, checks and balances alone are not going to do much to help Republican prospects for 2012.

Republicans need to communicate a vision, a plan and a message that give Americans an idea about what we stand for and what we would do differently to right the ship.

The economy is the number one issue on American’s minds. And a year and half into the Obama administration, the public is already impatient with the president's handling of the economy. In a Bloomberg poll, 71 percent say that we're still in a recession no matter what economists may say. And in a CBS poll, 51 percent of respondents say they expect effects of the recession to last two more years.

But there is a growing political, or class, divide when it comes to the economy. According to a new Politico poll, 45 percent of “Washington elites” say the country and the economy are headed in the right direction, while only 25 percent of the general population agrees. Not surprisingly then, according to Rasmussen, 68 percent of voters believe the nation’s “political class” doesn’t care what most Americans think.

This disconnect helps explain why only 23 percent of voters believe the federal government today has the consent of the governed.

Americans are hungry for leadership. They want more than just “No.”

Word is that sometime after Labor Day, Minority Leader John Boehner plans to serve up some steak – a blueprint of what Republicans will actually do if they take back the House. But some political consultants are counseling their congressional clients to not take any stands on substance that could give Democrats ammunition for a counterattack.

On this, former speaker and architect of the GOP takeover in 1994, Newt Gingrich is right: “Consultants, in my opinion, are stupid.”

The economy is a huge anchor weighing down President Obama right now. The oceans of discontent are rising and submerging all of the rescue rafts. And that may be the case two years from now, but the GOP shouldn't count on it.

Recent corporate earnings are up, Wall Street is on a hiring spree, and my orthodontist friend and focus group of one—Dave "Half" Nelson—says he's busier than he has been in years (and that 90 percent of his patients are spending discretionary dollars for treatment).

While these few signs may only point to a dead-cat bounce as last month’s report from the Fed was more pessimistic than expected, the natural business cycle means the economy inevitably will improve—and just in time for Obama’s second term, as it did for Ronald Reagan.

Reagan’s job approval ratings were in the low 40s in 1982, slightly lower than Obama’s current rating. After reaching a low of 35 percent in January of 1983, the economy improved—as did the public’s perception of the Gipper’s performance. Less than two years later, Reagan was re-elected.

Republicans may not like what Obama has done, but he's damn sure done a lot. And, importantly for his re-election, he's done pretty much what he campaigned on.

Here's how Democratic strategist Billy Moore frames up Obama's achievements so far: “Tuesday marks the 18th month of Barack Obama's presidency, and this week will notch yet another major legislative accomplishment: the enactment of financial services regulatory reform. President Obama's legislative prowess, including health care reform, the economic stimulus, tobacco regulation, student loan reform, credit card reform and equal pay, registers him among the most effective lawmaking presidents in a century.”

I’m not an economist, but I am a realist. I think it would be a good idea if we bet on the prospect that the economy is likely to improve. So the GOP better prepare with something more than "Just Say No."

And though I’m just another shallow media consultant, I second Rep. Paul Ryan’s advice to the GOP: “Let’s make certain we do not simply retreat to the same failed policies. Let’s make the tough, forward-looking choices that will restore the promise and prosperity of this exceptional nation, and let’s do it together.”

Time for the GOP to listen to Ryan and crank up the ideas machine. Or get used to four more years of Obama.

As vice chairman of Public Strategies and president of Maverick Media, Mark McKinnon has helped meet strategic challenges for candidates, corporations and causes, including George W. Bush, John McCain, Governor Ann Richards, Charlie Wilson, Lance Armstrong, and Bono.

Wednesday, July 21, 2010

Not Obama Is Not Enough

"There are risks involved, but if Republicans are to be taken seriously, they must be willing to detail specific alternatives to the Obama agenda."

From Victor Davis Hanson at NRO:

Republicans will shortly need to stand for something more than just being against much of the Obama agenda. Only a superior and detailed alternative can win more lasting support than just a midterm correction.

Obama, after all — with nationalized health care, amnesty, cap-and-trade, financial overhaul, government absorption of private enterprise, takeover of the student-loan industry, and gorge-the-beast deficits that will ensure a generation of higher taxes — at least seems to have some sort of plan to change America.

The absurdity of $1.5 trillion annual deficits is easy to run on; but where in the budget should we freeze or cut spending? To restore fiscal sanity, we need details rather than vague promises to reduce red ink to a particular percentage of GDP. Is there to be an across-the-board spending freeze or targeted cuts? How much, if at all, does defense get cut? If it does, where and how?

Fairly or not, we are at the stage where, at least in the short term, each proposed dollar of tax cuts needs to be matched by a proposed dollar of spending reduction. The supply-side notion of expanding federal revenue through tax cuts and business stimulation remains of course valid. But in the here and now, the public needs concrete reality, not assurances about more money to come in within a year or two.

Amnesty — under the euphemism of “comprehensive immigration reform” — would be a disaster. But in critiquing Obama’s policies, Republicans need to explain precisely how employer sanctions, increased patrols, and the completion of the fence will result in near-zero illegal entry. Then they must detail what exactly to do with the existing population of illegal aliens, which may well exceed 12 million — of whom most are neither felons nor unemployed.

What exactly is earned citizenship, and how does it differ from amnesty? Does one have to go back to Mexico to apply for readmission for American residency or to obtain citizenship? How would fines be levied and collected? Are we to close the border first, and let various agencies incrementally deport illegal aliens over several years as they come across them?

If the Republicans are not prepared to answer these questions and more, then they will get hit with the charge of advocating “mass deportations” — and with 60 Minutes–style stories of a valedictorian Victoria Lopez or a football star Jorge Garcia detained during a traffic stop and cruelly put on a bus to Oaxaca.

Obama seems lost on Afghanistan. He avoided General McChrystal for months. He foolishly, as with his promises on Guantanamo, set an arbitrary date for phased troop withdrawals. And he is imprisoned now within his own self-created paradox of the supposed good war in Afghanistan turned bad, and the bad war in Iraq turned good.

But what is the alternative? Can Republicans articulate a simple three-step policy that will set out: (1) our objectives and aims in Afghanistan, (2) how we are going to achieve them, and (3) a rough estimate of the costs and sacrifices necessary? Can they explain why continuing the war is preferable to leaving? Without some specificity about what would constitute victory and how we can secure it, we are back to Nixon’s campaign promise of a “secret plan” to abruptly end the Vietnam War, which turned out to be Vietnamization stretched out over four years.

Obama’s reset foreign policy is heading for a Carter-like collision with reality. But so far has anyone in the opposition explicitly explained why the new alignment policy is wrong, and how it can be changed? Should we reemphasize our ties with Britain, Colombia, Israel, and India, while ceasing to talk to Iran and Syria? What would the conservative reset-button diplomacy with Russia and China look like?

It is easy to denounce the pathetic apology tours, but what exactly is the Republican vision of how to explain an exceptional America without being haughty? Instead of U.N. guidance, is there to be a determined effort to encourage democratic and free-market nations to join America in resisting autocracy? Can we hear that Guantanamo both is a humane detention center and fulfills a need in a war in which terrorist killers do not fit the traditional criteria of the Geneva Conventions, as Eric Holder himself once explained? Could a Republican explain how these new $1.5 trillion deficits cripple U.S. foreign-policy options?

Cap-and-trade looms as a calamity. The billions Obama has spent on wind and solar subsidies seem to be yet another boondoggle. Fine — but exactly how are we going to transition to new fuels without going broke? Will the Republicans explain why oil, natural gas, clean coal, and nuclear, hydroelectric, wind, and solar power are all necessary, and state the rough percentage of our energy profile that each should make up? Can they retool “Drill, baby, drill” for the post-BP age?

The more we learn about Obama’s health-care solution, the more we see that it will be the source of vast new problems. Okay. But do the Republicans have a way to manage costs for the aged and ill, who in their last year often exceed the aggregate health-care expenditure of their entire life up until then? Can the opposition address that issue in ways other than dismissing “death panels”? Do kids between age 23 and their first job need health insurance? And if so, how are they going to get it? How does the middle-class family with a house, two cars, and a 401(k) not lose everything if the suddenly out-of-work father develops lymphoma? Or does it lose everything?

Entitlement costs are slowly strangling the American economy. Medicare and Social Security are unsustainable. We can all agree on that, and on the fact that the Democrats’ usual response is to demagogue anyone who points it out. But what exactly would Republicans do? Raise the age for Social Security eligibility? Raise Medicare premiums? The days of simply adding on prescription-drug benefits without the means to pay for them are long over. And yet the last time Republicans offered the solution of quasi-private retirement and health-care accounts, in 2005, they were massacred politically. Have they got better ideas now — or a better notion of how to present these largely good ideas?

Cannot Republicans insist on an ethics pledge, so that the careers of a Charles Rangel and a Chris Dodd are not followed by another Jack Abramoff and Duke Cunningham?

Republican politicos will quite accurately lecture that presenting such detailed alternative plans would be foolhardy: The key now is simply to be against what an unpopular Obama is for. I accept that offering detailed solutions might well turn the public as much against the proposed medicine as against the original malignant disease.

Yet at some point, blanket Obama-bashing without a comprehensive alternative will turn stale. Critics of Obama — if they are to be taken seriously — will have to be about more than not being Obama. Instead, conservatives must identify exactly how to undo the Obama agenda — and do so in a way that does not earn them the disdain that the Republican Congress earned between 2001 and 2006, and the Republican administration between 2005 and 2009.

We need some notion of a contracted agenda, so that conservative voters can hold conservative politicians to account in this age of anti-incumbency. Voters wanted closed borders, balanced budgets, ethical members of Congress, and less government between 2001 and 2006. They believed that all of that had been promised — and then were sorely disappointed.

In short, conservative voters want to see something specific — as much to keep their own honest as to defeat the other.

Joe Biden, Underpants Gnome - Voters are ignorant, he suggests. But don't worry, they'll learn somehow!

This is exactly what Baron Hill and the rest of his liberal/Progressive/leftwing/elistist D.C. buddies think of us!!!  "You can't possibly have the same information that I am privy to, so let ME make your decisions for you.  Trust me"!!!  Yeah right!-Sp

From James Taranto at The WSJ:

Some polls show that a majority of Americans disagree with some Republican congressmen about some things, yet Republicans seem likely to do well in November.

An example, according to Newsweek's Jonathan Alter: Americans "overwhelmingly favor more regulation of Wall Street." Last week Congress passed a bill styled the Restoring American Financial Stability Act of 2010, which President Obama will soon sign, and which will provide for "more regulation of Wall Street." Hardly any Republicans (only three in each house of Congress) voted for the bill, and House Minority Leader John Boehner has said he'd like to repeal it.

So why would people vote Republican? Alter's answer:

Because they aren't rationally aligning belief and action; they're tempted to lose their spleens in the polling place without fully grasping the consequences.

Eureka, voters are irrational! If they were rational, they would vote for Democrats.

.A Republican might counter that "voters rightly sense that financial reform doesn't address the problem of 'too big to fail' " and that "when Obama says the bill means 'No more taxpayer-funded bailouts--period,' he lessens his credibility." But a Republican wouldn't have to say that, because Alter does--in the same column. Sounds as though someone is suffering from a bit of cognitive dissonance.

Alter's attitude is typical of the political class. Of course actual politicians can't afford to be quite so brazenly condescending, since their careers depend on persuading voters to support them. The results can be quite comical, as when Vice President Biden tried yesterday to make an Alter-like argument without insulting the voters. Politico describes the interview:

Asked by ABC's "This Week" host Jake Tapper . . . if the administration "is getting enough credit" for the Wall St. bill, the health care bill, and the economic Recovery Act in light of polls showing the majority of Americans believe the country is on the wrong track, Biden said: "The vast majority of the American people and a lot of people really involved don't even know what's inside the packages." . . .

Despite those polls, Biden said, the country is moving in the right direction, saying of Americans who disagree "nor could they or should they" understand that, given the 6.7 million jobs lost in the last six months of the Bush administration and the first six months of the Obama administration.

Biden thinks the voters are ignorant, but he credits them with being rationally so. But also unlike a journalist, a Democratic politician cannot afford to risk his own party's morale by predicting a Republican victory. So Biden went on to predict that voters will overcome their ignorance in the next 3½ months and vote Democratic. From the transcript:

I am absolutely confidence--confident when people take a look at the what has happened since we've taken office in November and comparing it to the alternative, we're going to be very--we're going to be in great shape.

The vice president's description of the administration's political strategy reminds us of the business plan of the Underpants Gnomes from "South Park":

Phase 1: Legislation

Phase 2: ?

Phase 3: Victory

A more conventional approach, one with a clear path to political victory, goes like this:

Phase 1: Convince voters of the merits of your proposal

Phase 2: Legislation

Phase 3: Victory

If you win the voters' support for your proposals first, not only do they have a reason to stick with you, but more members of the other party will feel obliged to vote your way, even if they have misgivings about your policies. George W. Bush took this approach to the Iraq war resolution in 2002. It passed with bipartisan support, and declining public confidence in the war effort did not hurt Republicans at the polls until four years later.

One can make the case--assuming for the sake of argument that Obama's legislative initiatives were good policy--that the stimulus was a response to a crisis and thus passing it quickly was more important than winning broad support ahead of time. The same can be said of the 2008 financial bailout legislation, for which some supporters are now paying a political price. Perhaps one could make the same argument for last week's Wall Street legislation, though that's more of a stretch.

But not ObamaCare, which was not a response to a crisis but an exercise in ideological and political vanity. There is no excuse for the Democrats' having pushed through this law after having failed to win popular support for it. Under these circumstances, it is completely rational to support the only party capable of checking such imperious behavior.

Tuesday, July 20, 2010

Today’s Keynesians have learnt nothing

From Niall Ferguson at The Financial Times:

To those of us who first encountered the dismal science of economics in the late 1970s and early 1980s, the current debate on fiscal policy in the western world has been – no other word will do – depressing.

It was said of the Bourbons that they forgot nothing and learned nothing. The same could easily be said of some of today’s latter-day Keynesians. They cannot and never will forget the policy errors made in the US in the 1930s. But they appear to have learned nothing from all that has happened in economic theory since the publication of their bible, John Maynard Keynes’s The General Theory of Employment, Interest and Money, in 1936.

In its caricature form, the debate goes like this: The Keynesians, haunted by the spectre of Herbert Hoover, warn that the US in still teetering on the brink of another Depression. Nothing is more likely to bring this about, they argue, than a premature tightening of fiscal policy. This was the mistake Franklin Roosevelt made after the 1936 election. Instead, we need further fiscal stimulus.

The anti-Keynesians retort that US fiscal policy is already on an unsustainable path. With the deficit already running at above 10 per cent of gross domestic product, the Congressional Budget Office has warned that, under its Alternative Fiscal Scenario – the more likely of the two scenarios it publishes – the federal debt in public hands is set to rise from 62 per cent of GDP this year to above 90 per cent by 2021. In an influential paper published earlier this year, Carmen Reinhart and Kenneth Rogoff warned that debt burdens of more than 90 per cent of GDP tend to result in lower growth and higher inflation.

The Keynesians retort by pointing at 10-year bond yields of around 3 per cent: not much sign of inflation fears there! The anti-Keynesians point out that bond market sell-offs are seldom gradual. All it takes is one piece of bad news – a credit rating downgrade, for example – to trigger a sell-off. And it is not just inflation that bond investors fear. Foreign holders of US debt – and they account for 47 per cent of the federal debt in public hands – worry about some kind of future default.

The Keynesians say the bond vigilantes are mythical creatures. The anti-Keynesians (notably Harvard economics professor Robert Barro) say the real myth is the Keynesian multiplier, which is supposed to convert a fiscal stimulus into a significantly larger boost to aggregate demand. On the contrary, supersized deficits are denting business confidence, not least by implying higher future taxes.

And so the argument goes round and around, to the great delight of the financial media as the dog days of summer set in.

In some ways, of course, this is not an argument about economics at all. It is an argument about history.

When Franklin Roosevelt became president in 1933, the deficit was already running at 4.7 per cent of GDP. It rose to a peak of 5.6 per cent in 1934. The federal debt burden rose only slightly – from 40 to 45 per cent of GDP – prior to the outbreak of the second world war. It was the war that saw the US (and all the other combatants) embark on fiscal expansions of the sort we have seen since 2007. So what we are witnessing today has less to do with the 1930s than with the 1940s: it is world war finance without the war.

But the differences are immense. First, the US financed its huge wartime deficits from domestic savings, via the sale of war bonds. Second, wartime economies were essentially closed, so there was no leakage of fiscal stimulus. Third, war economies worked at maximum capacity; all kinds of controls had to be imposed on the private sector to prevent inflation.

Today’s war-like deficits are being run at a time when the US is heavily reliant on foreign lenders, not least its rising strategic rival China (which holds 11 per cent of US Treasuries in public hands); at a time when economies are open, so American stimulus can end up benefiting Chinese exporters; and at a time when there is much under-utilised capacity, so that deflation is a bigger threat than inflation.

Are there precedents for such a combination? Certainly. Long before Keynes was even born, weak governments in countries from Argentina to Venezuela used to experiment with large peace-time deficits to see if there were ways of avoiding hard choices. The experiments invariably ended in one of two ways. Either the foreign lenders got fleeced through default, or the domestic lenders got fleeced through inflation. When economies were growing sluggishly, that could be slow in coming. But there invariably came a point when money creation by the central bank triggered an upsurge in inflationary expectations.

In 1981 the US economist Thomas Sargent wrote a seminal paper on “The Ends of Four Big Inflations”. It was in many ways the epitaph for the Keynesian era. Western governments (not least the British) had discovered the hard way that deficits could not save them. With double-digit inflation and rising unemployment, drastic remedies were called for. Looking back to central Europe in the 1920s – another era of war-induced debt explosions – Professor Sargent demonstrated that only a quite decisive policy “regime-change” would bring stabilisation, because only that would suffice to alter inflationary expectations.

Those economists, like New York Times columnist Paul Krugman, who liken confidence to an imaginary “fairy” have failed to learn from decades of economic research on expectations. They also seem not to have noticed that the big academic winners of this crisis have been the proponents of behavioural finance, in which the ups and downs of human psychology are the key.

The evidence is very clear from surveys on both sides of the Atlantic. People are nervous of world war-sized deficits when there isn’t a war to justify them. According to a recent poll published in the FT, 45 per cent of Americans “think it likely that their government will be unable to meet its financial commitments within 10 years”. Surveys of business and consumer confidence paint a similar picture of mounting anxiety.

The remedy for such fears must be the kind of policy regime-change Prof Sargent identified 30 years ago, and which the Thatcher and Reagan governments successfully implemented. Then, as today, the choice was not between stimulus and austerity. It was between policies that boost private-sector confidence and those that kill it.

Candidate Meet & Greet this Sunday!

Or if you would rather speak to your candidates face to face here is an opportunity to do so in Jackson County this Sunday.

From Melissa Acton, Jackson County Republican Chairperson:


Please join Jackson Co Republicans in the large field across from the fairgrounds this Sunday from 4-6:00PM for a meet-the-candidates/rally/ice cream social. This is opening day of the Jackson Co Fair and a great opportunity for Republicans to "get out and be seen" at a fair where politicking is prohibited. Bring your family and friends, wear your favorite candidate's shirt, and when the ice cream is gone, we'll head across the highway and enjoy the fair! Congressional Candidate Todd Young and Ellie the Elephant will also be in attendance.

See you there!



From Erin Houchin, 9th District GOP chairperson:

On Monday, July 26 at 7:00pm Baron Hill will host a telephone town hall.

I encourage you to join this telephone town hall to let Baron Hill know how you feel about how he's voted on behalf of "his" Congressional District.

HILL TO HOST TELEPHONE TOWN HALL: U.S. Rep. Baron Hill has scheduled a telephone town hall meeting for 7 p.m. Monday July 26. Constituents will have access to a question-and-answer session with Hill via telephone. Because of Indiana law regarding unsolicited phone calls, in order to join the call Ninth District residents must complete an online form at If folks need assistance completing the form, don’t have access to a computer or have questions, please contact Hill’s Washington office at 202.225.5315. The form is also available on the homepage of Hill’s web site,


Erin Houchin

Reclaiming America: Why We Honor the Tea Party Movement

At Heritage:

Remember when Conservatism was supposed to be dead and America was primed for a New New Deal? Well, a funny thing has happened on the road to the latest iteration of progressive liberalism—The Tea Party Movement.

The Tea Party Movement has been one of the most significant citizen efforts in our times to revive America’s founding principles. Across the country, people who had before never been engaged in politics—people like Billie Tucker of The First Coast Tea Party {}—began to attend rallies with homemade signs begging for fiscal common sense and a return to constitutional government. This grass roots movement has been much maligned (especially on the left and in the media) and rarely honored for their activities. Until now.

At the 2010 Resource Bank, the Tea Party Movement was recognized as the recipient of the annual Salvatori Prize for American Citizenship. Named for entrepreneur and philanthropist Henry Salvatori, the Salvatori Prize for American Citizenship is given annually to American citizens who uphold and advance America’s principles, embody the virtues of character and mind that animated America’s Founders, and exemplify the spirit of independence and entrepreneurial citizenship in the United States. Matthew Spalding explained why Heritage honored the Tea Party Movement with this award:

Behind [The Tea Party Movement’s] activities and motivating their efforts is not a single issue or partisan agenda but a deepening commitment and advocacy of the truths of the Declaration of Independence and the basic principles of the United States Constitution. Because of the significance of this effort, bringing America’s first principles to the fore of the public debate, motivating millions of their fellow Americans to get involved in the effort to revive those principles and to reorient our politics toward them, the 2010 Henry Salvatori Prize for American Citizenship is awarded to the Tea Party Movement and thereby honors all those American citizens nationwide who are now newly committed to renewing American liberty.

The Tea Party Movement is in good company. Past recipients of the Salvatori Prize include David McCullough (2009) and Princeton University professor Robert P. George (2008) as well as the Mount Vernon Ladies Association (2005) and The Federalist Society (2006).

The Tea Party Movement is truly a grassroots movement. It was not organized by one individual or group. As a result, there is no single recipient of the award. Instead, the funding from the Salvatori Prize has been used to help meet the tremendous demand for educational materials from tea party organizations across the country. So far, 265 Tea Party Movement leaders from every state and the District of Columbia have received a collection of First Principles resources, monographs, and books: including copies of We Still Hold These Truths: Rediscovering Our Principles, Reclaiming Our Future, The Heritage Guide to the Constitution, and How to Read the Federalist Papers. An even greater number of groups has received bulk copies of the pocket Declaration of Independence and the Constitution and Heritage fact sheets to distribute at their events.

Like their 18th century brethren, today’s Tea Party Movement faces an impetuous vortex of government that everywhere extends its sphere of activity. But, as Spalding reminds us, there is a key difference between those early patriots and the movement today:

Those early patriots had to establish their independence and to start anew. Our task is different. It is not about fixed bayonets but fixed principles; not about bullets but ballots. Our task is not to overthrow; it is not revolution; it is renewal and restoration of those self-evident truths of constitutional government at the heart of America

Video: Ellsworth and the special interests

At Hot Air:

The Brad Ellsworth campaign has tried mightily to keep Indiana voters from remembering that the former sheriff has spent the last four years in Washington as a member of Congress, as his first ad intended to obfuscate with repeated talk about how “they” (Congress) play footsie with special interests. A week after releasing the ad, Ellsworth got spotted in Vancouver schmoozing with trial lawyers at a convention, looking for some funding for his race against Dan Coats in an attempt to get within 20 points of the Republican candidate. The NRSC has some fun with Ellsworth’s claims of eschewing special interests while hobnobbing with an interest group so unpopular outside of Democratic leadership that they had to change their name in 2006:

It was just a few weeks ago that Democrats tried painting Coats as a candidate in thrall to lobbyists. How will they explain Ellsworth’s international travels to beg for trial lawyer cash?