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3701  Politics, Religion, Science, Culture and Humanities / Politics & Religion / No Grounds for Claim that Obamacare Lowers Healthcare Costs on: December 12, 2013, 01:15:30 PM
A persuasive article on the healthcare cost trends:
No Grounds for Claim that Obamacare Lowers Healthcare Costs

"the public is being told that the ACA is responsible for government actuaries’ improved health spending projections, when an examination of those projections clearly shows that not to be so. "

Charles Blahous is a senior research fellow for the Mercatus Center, a research fellow for the Hoover Institution, and a public trustee for Social Security and Medicare.
3702  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Politics at State & Municipal level: MN Estate, gift, income taxes on: December 12, 2013, 01:06:49 PM
“Every day we get calls from people about changing residency,”  And they tend to be employers!

This could go under Tax policy.  Also under Calif as the problems, post-Pawlenty here, are nearly the same with Dems controlling the state house, senate and Governor office.

Alarming excerpt buried in a positive, economic piece:

"This is the largest upward move in tax progressivity … since we started our tax-incidence reports in 1990.”

Many liberals and moderates like this trend. But some high-earners predict an exodus of affluent Minnesotans to Florida and other low-tax states. Especially troubling, they say, is the state’s failure to increase the amount excluded from inheritance taxes closer to the higher federal estate tax exclusion. Federal law exempts the first $5.25 million, Minnesota only the first $1 million.

Hunt Greene, a veteran Minneapolis investment banker, said: “I’m a Democrat. I can afford and tolerate paying higher income taxes. This is different. The Minnesota gift-and-estate taxes kick in at $1 million. The federal level is $5.25 million. And Minnesota is one of only a few states that have a gift tax.

“The result is that, as I talk to the big law firms about their business … their estate practices are swamped with people figuring out how to change their residences,’’ Greene said.

He’s not alone. Others predict that more wealthy Minnesotans will leave rather than subject their estates of over $1 million, or gifts made to heirs, to what can be up to a 40 percent tax that doesn’t exist in states such as Florida or Arizona.

“Every day we get calls from people about changing residency,” said Bob Abdo, a political moderate and 40-year Minneapolis business lawyer. “This pains me. I grew up and was educated here. Essentially, what we have got now is a disincentive for longtime Minnesota residents to stay in Minnesota.

“This means mom and dad … who are loyal to Minnesota because they earned a lot of money here, may now be worth more than $1 million. So, dad dies. No estate tax consequence to mom. But mom is worth $1 million, and it doesn’t take much if you add a house, your retirement accounts and a life insurance policy. Mom dies. It’s supposed to go to the kids. Any amount that goes to the kids in excess of $1 million, whether one kid or 12, will be taxed at about 40 percent for the first $250,000. The tax goes down from there.
3703  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The US Congress; Congressional races on: December 12, 2013, 12:57:55 PM
"The Republicans are on target to win by default.  Not win with an agenda as far as I can see."

"The same was said here by some of us with regard to the 2012 presidential election."

That's right.  Thomas Sowell made a point that I took a rare disagreement with, that politics is zero-sum.  When R's screw up, Dems gain. That makes sense.  But when Dems screw up, it only opens an opportunity, and is not an automatic vote for Republicans nor does their failure alone create any new conservatives, libertarians or Republicans.  On this, Crafty has been right on the money in asking, what is our answer, what is our message, what is our policy that would replace theirs and why, how do we explain this better.  Here on the forum, we are constantly agonizing over how to do that.  In Washington it seems they are not.

In 2012, Romney spent the final stretch on defense, I'm not as bad of a guy as you think I am and that they told you that I am, he told us.  Meanwhile, unspoken and un-promoted was the fact that his economic plan would have led us out of this economic misery and that his Supreme Court appointments might have at least attempted to uphold the constitution.

In elections, you need personalities and sound bites, but during these periods in between elections it seems to me that we can take on the longer arguments as to why these philosophies and policies of theirs are misguided - and what kinds of policies will work. 

So far we are divided, confused and playing defense.

3704  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Political Economics - Charles Blow on: December 12, 2013, 12:27:00 PM
"The case made here is not without eloquence:  How do we respond?"

In messaging, the more compassionate voice wins, hence Obama elected twice, a Dem Senate, etc.  in practice, the Charles Blow view loses; it makes things worse for the people they purport to help.  Easily proven in the data, see yesterday's posts.

So Rand Paul is right on policy and wrong on messaging.  Unemployment compensation prolongs unemployment.  It is a provable fact.  Food stamps create dependence.  Minimum wage hurts low end employment.  SSI requires a contract with poverty for people on the edge of the workforce.  Pointing out any of these truths inspires columns by well-publicized, liberal Blow-hards.

No one here, especially not me, has messaging figured out.  But the answer has something to do with focusing our time and message on positively painting the picture of a prosperous, opportunity society, how we can do that, and not arguing against the details of social spending programs with leftists.  When you suggest cutting food stamps, unemployment, disability you are losing votes.  Instead, move prosperity forward and move these programs down in importance.
3705  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Martin Feldstein: Obamacare’s Fatal Flaw on: December 12, 2013, 12:05:10 PM
Obamacare’s Fatal Flaw
by Martin Feldstein,  Professor of Economics at Harvard University and President Emeritus of the National Bureau of Economic Research, chaired President Ronald Reagan’s Council of Economic Advisers from 1982 to 1984.

The potentially fatal flaw in Obamacare is the very same feature that appeals most to its supporters: the ability of even those with a serious preexisting health condition to buy insurance at the standard premium.

That feature will encourage those who are not ill to become or remain uninsured until they have a potentially costly medical diagnosis. The resulting shift in enrollment away from low-cost healthy patients to those with predictably high costs will raise insurance companies’ cost per insured person, driving up the premiums that they must charge. As premiums rise, even more relatively healthy individuals will be encouraged to forego insurance until illness strikes, causing average costs and premiums to rise further.
The “wait-to-insure” option could cause the number of insured individuals to decline rapidly as premiums rise for those who remain insured.

"...a better plan: eliminate the current enormously expensive tax subsidy for employer-financed insurance and use the revenue savings to subsidize everyone to buy comprehensive private insurance policies with income-related copayments. That restructuring of insurance would simultaneously protect individuals, increase labor mobility, and help to control health-care costs."
3706  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Fed, Banking, Monetary Policy, Greenspan's book on: December 12, 2013, 11:54:19 AM
Alan Greenspan, who couldn't speak intelligibly, can't write either.

He was chief economist to Gerald Ford from 1974 to 1977, perhaps our most economically illiterate Republican President.  Reagan chose him to head the Fed for the independent reputation he earned being a skeptic of Reaganomics.  (Most Dems believe Reagan was senile by 1987.)

"It [Greenspan's new book] suffers in trying to appeal to two audiences.  One audience is the professional economists. The book contains dozens of graphs and tables of regression analysis, together with t-statistics calculated with the appropriate Newey-West heteroskedasticity and autocorrelation consistent standard errors. (Don’t ask.)  But Greenspan is also writing for lay readers who want to hear from this famous man about how the economy works. For their sake, most of those graphs and tables are put in an appendix, where they can be safely ignored.  In trying to reach two audiences, the book does not quite reach either. Economists can learn a lot from it, but they will recognize that many of the arguments would have trouble passing scrutiny in peer-reviewed journals. "
3707  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: New York state of mind for some Supreme Court justices on: December 12, 2013, 11:36:15 AM
Peoria, Iowa.   It is one thing to not know where a famous American city of 115,000 is.  But he didn't not know; he knew wrongly.  Makes one wonder what else Justice Breyer falsely believes is true. 
3708  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Senate Seats That Could Flip Parties in 2014, Sean Trende, RCP on: December 12, 2013, 11:06:32 AM
The good news, if this is a real sweep year, R's could pick up 9 or 10 seats.  The bad news, in order to hold onto the Senate in 2016, R's will HAVE to pick up 9 or 10 seats this year.
Read it all, if interested.  I'll post one chart.  R's have some shot at winning up to about  'D+2' and maybe Michigan, D+4.


Robert Gibbs (former Obama spokesman) said "if these numbers hold up, it's going to be very, very tough to get around that and see somehow that Democrats retain the Senate or have a reasonable chance of winning the House"
3709  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Political Economics on: December 12, 2013, 10:43:12 AM
Yes, isn't it odd that Obama's policies actually cause income inequality to get worse - as we stagnant.  It only proves that, as he tries to teach uswhat he knows, he really knows nothing about the subject. 

Tax rate progressivity for the last 34 years - below.  (That the executive ever paid less in taxes than his secretary in any real sense is bullsh*t.)

3710  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Humor, Are they married? on: December 12, 2013, 10:34:32 AM
    How can a stranger tell if two people are married?

    You might have to guess, based on whether they seem to be yelling at the same kids.  - Derrick, age 8
3711  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Benghazi and related matters on: December 12, 2013, 10:25:50 AM
Yes, absent an American government account, we'll go with the photo.  GM has been right on this, where is the autopsy report - it's been 15 months!  Is it secret, do we need a Warren commission?

Who ordered the stand-down? How? When? Why?

Who came up with the youtube video story?  Who said run with it? Why?

There was no protest.  A blatant lie.  There was no report at the time or in post-attack interviews of a protest.  The lies about the protest and the video were put forward at least dozens different times by the highest officials intending only to obfuscate the truth.  So what is the truth, start to finish?!  We know where George Bush was when he learned of the 9/11/2001 attacks.  They made a full length movie on it.  Where was Pres. Obama?  Where was Sec. Clinton?  We paid for the cameras that filmed the attacks.  Did they watch in real time.  Did they have second thoughts on ordering the stand down.   Two of the dead were defying stand down orders.  Did they consider court-martial when they learned this?  Was the Pres. working on his Vegas speech during the attack?  Did he go to bed while Americans were under attack?  Did he sleep well?
3712  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: US Economics, counter-balancing Wesbury on: December 10, 2013, 11:41:48 AM
Wesbury:  the same Plow Horse trend of the past few years

G M: "Should crosspost that under the latest Webury drivel."

Excerpt from Political Economics, by request:
Food stamp use nearly doubles in suburbs

The Sharp Rise in Disability Claims
90,609,000: Americans Not in Labor Force Climbs to Another Record - See more at:

Women leaving the U.S. workforce in record numbers
Unemployed women hit an all-time historical high of 53,321,000, according to the Bureau of Labor Statistics.
U.S. savings rate hits lowest level since 1933

3713  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Amend the 'Affordable Care Act' to allow affordable plans to qualify on: December 10, 2013, 11:33:40 AM
In semi-sound bite fashion, how do we answer the argument that Powell is making here?
Okay, you first! 

My view is that we need a clean and simple political compromise that a number of Senate DEMOCRATS in red and swing states can grab onto to save face.  Amend the Affordable Care Act to allow affordable plans to qualify.  Combine this with other cost savings reforms including an individual tax deduction to match what employers take, selling across state lines, healthcare tort reform and mandatory price disclosures.  Then move on to improving affordability by improving economic growth!

Powell:  "I don't see why we can't do what Europe is doing, what Canada is doing, what Korea is doing, what all these other places are doing."

What these other places are doing to a large extent is paying only the variable cost of what is developed in the US.  Along with rationing via queue.  Average wait between GP referral and receiving orthopedic surgery in Canada is 40 weeks?

Powell, as a four-star general in a military hospital, always had good service.  Ya think?  How are the rest doing at the VA? 

Two countries in the world do not have a private healthcare system operating alongside the public system, Canada and North Korea.  In Canada, the private healthcare system is to travel to the US. - leaving North Korea alone in that distinction.

Americans just saw the failure of a bureaucracy-based transformation of healthcare.  We weren't ready for the full government takeover in 1993 or in 2009.  Post-Obamacare, we really aren't ready now!   If you take away the private system altogether and there are 80 million or so dissatisfied in the US, where do they go for healthcare.  To a private system in Canada??  There is no such thing.

3714  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Political Economics, War on Wealth is not the cure for poverty! on: December 10, 2013, 10:11:02 AM
Pope Francis is an expert on poverty; he has lived within and around it all his life.  The President is an expert on demagoguing wealth; he rose to great heights doing that.  The Pope does not know how to solve the condition of poverty and the President does not know how to solve the false problem of income inequality.

As George Gilder and others have pointed out, poverty is not something in itself to study or know.  Poverty is the lack of something - the lack of wealth.  You don't learn about poverty by studying poverty.  You learn about it by studying wealth and wealth creation.  Then go back to poverty to see what elements of wealth creation are missing.

Income inequality isn't the study of any one phenomenon.  It is the study of two unrelated phenomena and meaninglessly comparing them.

How much do people who do not participate or fully participate in our economic system make?  Don't count all the assistance we already give them in trying to alleviate the condition.  How much do other people make who have fully committed, invested and succeeded?  Don't count what we take from them that they don't get to keep or reinvest.  Income Inequality is the stunning revelation that the people who make more money, make more money than the people who make less money.

Removal of income inequality is the removal of a ladder up.  What you earn now is all you will ever aspire to earn.  Education, saving, investing, hard work, commitment, innovation, surrounding yourself with the best people you can find, persistence, perseverance - all would make no difference.

The top 40% already pay106% of the taxes in this country, (how much more should they pay?):

You do not and cannot fight poverty or economic under-performance by taking down wealth.  What you do is lock in that success, find what is working for the top 40% and make it available to the rest.

A war on income inequality is a war on wealth.  A successful war on wealth means that poverty will be even more widespread.  Instead of celebrating and wealth creation and spreading it to others, we punish it, demonize it, and instead reward the opposite - in all its manifestations.
Food stamp use nearly doubles in suburbs

The Sharp Rise in Disability Claims
90,609,000: Americans Not in Labor Force Climbs to Another Record - See more at:

Women leaving the U.S. workforce in record numbers
Unemployed women hit an all-time historical high of 53,321,000, according to the Bureau of Labor Statistics.
U.S. savings rate hits lowest level since 1933
3715  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Nelson Mandela - Some Inconvenient Facts... on: December 10, 2013, 09:26:04 AM
Besides choosing the wrong side and policies for foreign affairs, how bad are your economic policies when ending apartheid leads to a doubling of unemployment?;jsessionid=78392164F8856F5204DF0F58B82ADFE5.present2.bdfm
Unemployment doubles after apartheid
"since apartheid ended unemployment has more than doubled from 13% to according to the broad definition to 36%"
"South Africa in labour competitiveness ... to ranks seventh lowest out of 139 countries"

I hope that is not what we are celebrating.
3716  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Cognitive Dissonance of His Glibness on: December 10, 2013, 08:58:20 AM
Curious, is he bowing to 'President' Castro, or just trying to adjust for the height difference?

A little less enthusiasm and eye contact during a Boehner handshake:

Speaking of knowing friend from foe, if anyone has any photos of President Obama at the Maggie Thatcher services, please post.
3717  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: 2016 Presidential, Thomas Sowell on Wisc. Gov. Scott Walker on: December 10, 2013, 08:50:30 AM
Highly respected conservative historian and economist Thomas Sowell concludes his Christmas book recommendation column today ( with this high praise of Scott Walker:

"With so many people already speculating as to who might be the front-runner for the Republican nomination for president in 2016, Wisconsin governor Scott Walker’s new book, Unintimidated, may be especially worth reading. It shows a man of real depth, and with an impressive track record that ought to overshadow the rhetoric of others, especially among the Washington Republicans.  Unlike the Washington Republicans, Governor Walker has been tested and has come through with flying colors. His ending the labor unions’ sacred-cow status in Wisconsin — in spite of union thuggery in the capitol and death threats to himself, his wife, and his children — tells us what kind of man he is."
3718  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Way Forward for the American Creed on: December 10, 2013, 08:42:22 AM
Concluding a short rant on income inequality on Powerline is this concise truism:

"The GOP must be the party of opportunity. As long as voters understand that Republicans stand for upward mobility and Democrats are the party of establishment cronyism, the future will be bright."  - John Hinderacker,
3719  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Politics of Health Care on: December 09, 2013, 10:44:35 PM
"...we need to be aggressively presenting our solutions!!!"

The right answer from my point of view is to get the government, especially the federal government, out of healthcare, except for basic and essential regulations.

To clarify the question though, I think what we are seeking is the best political compromise that could realistically get us out of this train wreck known as Obamacare in the least sociailistic, totalitarian, big government way possible.

3720  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Cognitive Dissonance of His Glibness on: December 09, 2013, 10:30:26 PM
My numerous complaints notwithstanding, President Obama decision to invite George and Laura Bush with the Obamas and Hillary to the Mandela services on Air Force One appears to be a classy move IMHO.
3721  Politics, Religion, Science, Culture and Humanities / Politics & Religion / The war on the rule of law, NY Post: Jobless rate may be rigged on: December 09, 2013, 10:22:40 PM
By John Crudele, NY Post Business Writer

December 7, 2013
Warning: Jobless rate may be rigged

The most curious thing of all about the November jobs report released on Friday was the huge drop in the unemployment rate — and the fact that the Labor Department chose not to disclose that the data going into that figure are under investigation for falsification.

On Nov. 19, I broke the news in my column that the Census Bureau, which collects data that goes into the jobless rate on behalf of Labor, had caught one of its enumerators fabricating interviews in 2010.

The culprit said back then (and to me during an interview) that he was told to do so by Census supervisors who were in the position to instruct others to make similar fabrications.

In fact, a source who I haven’t named but who is familiar with the Census data accumulation process has told me that falsifications have been occurring on a regular basis.

The Census Department surveys that went into the November jobless rate actually took place during the week that included Nov. 5 instead of the normal Nov. 12 week.

The Labor Department did put in a note about the survey week change in its November report.

But it should also have included another line that said: “The data for the unemployment rate may have been compromised. Lots of people are looking into the matter right now. We’ll get back to you on whether you should believe these numbers or not.”

Why didn’t the Labor Department include a note like that? A source who knows the department well says the concept of data being falsified is so unprecedented that the bureaucrats just don’t know how to react.

They had better figure it out soon. That drop in the unemployment rate might be the straw that sends the Fed into tightening mode.
3722  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Politics of Health Care, Medicaid continued, NY Post / Cato on: December 08, 2013, 01:58:56 PM
"The poor already had unlimited free healthcare in America.  This (Obamacare) never was about helping the poorest among us."

It seems to me that too many people are unaware that the poorest among us are receiving more than 4400/yr subsidy PER PERSON for free health care.  No one fully understands federal social spending programs, but Medicaid mostly addresses the so-called poor, CHIPS is aimed at up to 200% of the poverty line.  Obamacare gives subsidies up to about 400% of the poverty line.  And then, of course, we don't count money like this when we measure their income.  Please read this in its entirety.

1.46 million of the first 1.6 million to sign up for 'Obamacare' are really enrolling in Medicaid (Is it hard to 'sell' free health care?)

ObamaCare created a Medicaid time bomb

By Michael D. Tanner

December 7, 2013 | 9:15pm
Modal Trigger
ObamaCare created a Medicaid time bomb

The good news, if you want to call it that, is that roughly 1.6 million Americans have enrolled in ObamaCare so far.

The not-so-good news is that 1.46 million of them actually signed up for Medicaid. If that trend continues, it could bankrupt both federal and state governments.

Medicaid is already America’s third-largest government program, trailing only Social Security and Medicare, as a proportion of the federal budget. Almost 8 cents out of every dollar that the federal government spends goes to Medicaid. That’s more than $265 billion per year.

Indeed, already Social Security, Medicare and Medicaid account for 48% of federal spending. Within the next few years, those three programs will eat up more than half of federal expenditures.

And it’s going to get worse. Congress has shown no ability to reform Social Security or Medicare. With ObamaCare adding to Medicare spending, we are picking up speed on the road to insolvency.

The Congressional Budget Office projects that, in part because of ObamaCare, Medicaid spending will more than double over the next 10 years, topping $554 billion by 2023.

And that is just federal spending.

State governments pay another $160 billion for Medicaid today. For most states, Medicaid is the single-largest cost of government, crowding out education, transportation and everything else.

New York spent more than $15 billion on Medicaid last year, roughly 30% of all state expenditures. The Kaiser Foundation projects that over the next 10 years, New York taxpayers will shell out some $433 billion for the program.

But none of these projections foresaw that so many of ObamaCare’s enrollees would be Medicaid eligible.

To be sure, the health-care law’s designers saw the expansion of Medicaid as an important feature of their plan to expand coverage for the uninsured. Still, they expected most of those enrolling in ObamaCare to qualify for private (albeit subsidized) insurance.

It’s beginning to look like that was just another miscalculation, one that could have very serious consequences for the program’s costs.

Moreover, any projection of Medicaid’s future cost to New York taxpayers assumes that the federal government keeps its promise to pay 100% of the cost for Medicaid’s expansion over the next three years and 90% thereafter. But given the growing burden that Medicare will put on a federal budget already facing high debt levels, how likely is it that changes in the federal share of Medicaid will stay off the table?

In fact, as part if last December’s fiscal-cliff negotiations, the Obama administration briefly considered changing to a “blended” reimbursement rate, somewhere between the current and promised rates. The administration quickly backed away from the offer, but it’s likely to come back in the future. If it does, it would cost New York tens of millions of dollars.

Every bit as bad as the cost is the fact that for all this money, recipients are going to get pretty lousy health care.

Of course, one might say that even bad health care is better than no health care. But, unfortunately, for Medicaid, that’s not true.

The Oregon Health Insurance Exchange study, the first randomized controlled study of Medicaid outcomes, recently concluded that, while Medicaid increased medical spending increased from $3,300 to $4,400 per person, “Medicaid coverage generated no significant improvements in measured physical-health outcomes.”

Other studies show that, in some cases, Medicaid patients actually wait longer and receive worse care than the uninsured.

While Medicaid costs taxpayers a lot of money, it pays doctors very little. On average, Medicaid only reimburses doctors 72 cents out of each dollar of costs. ObamaCare does attempt to address this by temporarily increasing Medicaid reimbursements for primary-care doctors, but that increase expires at the end of next year.

Because of the low reimbursement, and the red tape that accompanies any government program, many doctors limit the number of Medicaid patients they serve, or even refuse to take Medicaid patients at all. An analysis published in Health Affairs found that only 69% of physicians accept Medicaid patients. A study published in the New England Journal of Medicine found that individuals posing as mothers of children with serious medical conditions were denied an appointment 66% of the time if they said that their child was on Medicaid (or the related CHIP), compared with 11% for private insurance — a ratio of 6 to 1.

Even when doctors do still treat Medicaid patients, they often have a harder time getting appointments and face longer wait times. One study found that among clinics that accepted both privately insured children and those enrolled in Medicaid, the average wait time for an appointment was 42 days for Medicaid compared to just 20 days for the privately insured. One study found that among clinics that accepted both privately insured children and those enrolled in Medicaid, the average wait time for an appointment was 42 days for Medicaid compared to just 20 days for the privately insured.

That’s one reason why so many Medicaid patients show up at the emergency room for treatment. They can’t find a doctor to treat them otherwise.

This not only increases the strain on already overburdened emergency room doctors, but increases the wait for those who arrive with real emergencies.

As bad as this is now, ObamaCare will make it worse by increasing the number of people on Medicaid without doing anything to increase the number of doctors treating them.

We don’t know yet whether the rush to Medicaid will continue. It may be that the troubles with the ObamaCare website might have skewed the early signups. But if ObamaCare really does lead to a massive expansion of this costly and inefficient program, that’s bad news for taxpayers, providers and patients.

Michael D. Tanner is a senior fellow at the Cato Institute.
3723  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Sen. Rand Paul: My wife says 'no' to presidential bid on: December 08, 2013, 01:46:05 PM
My thought is that he can be (already is) a GREAT Senator.   Why screw that up with unsuccessful and divisive Presidential run. 

If R's should somehow take the White House, and the post-filibuster Senate while holding the House, they will need strong voices and consciences like those of Rand Paul to keep them honest and on track.

Rand Paul: My wife says 'no' to presidential bid
3724  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Political Economics: Obama shifts to rising income inequality on: December 08, 2013, 01:40:00 PM
"The reason I keep harping on income inequality is because the false analysis of it is used as the foundation for all leftist economic policies, including the ones that are holding us back today."  - yours truly, 11/13/2013
" No clear trend toward greater income inequality since 1989"

Among the famous people reading the forum is President Obama:
Obama shifts to rising income inequality
President Obama gave a major policy address on the economy today, calling for an increased minimum wage and saying the income gap is a threat to the American dream.

Obama turns attention to income inequality,0,826560.story#axzz2mui3myOe

Obama: Income inequality a defining challenge

And from the echo chamber, Enron adviser Paul Krugman:
Don't bother read, bumbling idiosy based on a false premise.

3725  Politics, Religion, Science, Culture and Humanities / Politics & Religion / war on the rule of law: Sensenbrenner calls for prosecution of Clapper on: December 08, 2013, 12:15:03 PM
Clapper, who is the Director of National Intelligence who famously said the Muslim Brotherhood is a secular group, might take the insanity plea.
Patriot Act author: Obama’s intel czar should be prosecuted

"Lying to Congress is a federal offense, and Clapper ought to be fired and prosecuted for it," the Wisconsin Republican said in an interview with The Hill.

He said the Justice Department should prosecute Clapper for giving false testimony during a Senate Intelligence Committee hearing in March.

During that hearing, Sen. Ron Wyden (D-Ore.) asked Clapper whether the National Security Agency (NSA) collects data on millions of Americans. Clapper insisted that the NSA does not — or at least does "not wittingly" — collect information on Americans in bulk.

After documents leaked by Edward Snowden revealed that the NSA collects records on virtually all U.S. phone calls, Clapper apologized for the misleading comment.

The intelligence director said he tried to give the "least untruthful" answer he could without revealing classified information.

Sensenbrenner said that explanation doesn’t hold water and argued the courts and Congress depend on accurate testimony to do their jobs.

"The only way laws are effective is if they're enforced," Sensenbrenner said. "If it's a criminal offense — and I believe Mr. Clapper has committed a criminal offense — then the Justice Department ought to do its job."
The Eric Holder, ends justify means, Justice Dept will get to this right after it prosecutes Attorney General Eric Holder for Contempt of Congress in Fast and Furious, after the Benghazi video maker is brought to justice, after closing Guantanamo, and after every American who likes their plan, keeps their plan.  These are busy times; they can't prosecutor every Obama administration official lie.
3726  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Immigration issues - Saudi's have the situation most like ours on: December 08, 2013, 11:57:57 AM

"Saudi Arabia is the world’s second biggest source of [expatriate and illegal expatriate] remittances, only behind the US, with outflows of nearly $28bn last year, according to estimates by the World Bank. “Millions of dollars of Saudi flows will vanish.  Riyadh has defended the expulsions, saying illegal expatriates have had months to legalise their status. The kingdom, which shares 1,800km of porous, mountainous borders with Yemen, had for years complained that the Yemeni government was not doing enough to stop illegal immigrants, drug dealers, armed militants or members of al-Qaeda from crossing to the kingdom."

"Riyadh has said it wants to forcibly expel as many as 2m of the foreign workers, including hundreds of thousands of Ethiopians, Somalis, Indians, Pakistanis and Bangladeshis, who make up around a third of the country’s 30m population. "

Good luck doing that here.
3727  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Politically (In)correct on: December 08, 2013, 10:55:27 AM
" The New Yorker is correct about this, even though they don't give Reagan any credit for it."

Truth is not the aim in the left wing publications, only an occasional, unintended consequence.
3728  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Cognitive Dissonance of His Glibness on: December 08, 2013, 10:05:30 AM
To the above in the thread, yes, the man who lied about his mom who it turns out had full coverage in her battle with cancer, lied about not knowing his uncle.  He in fact lived with him, but - "his staff got it wrong".

The fault with Obama's big governmenthealthcare trainwreck is not with his leadership, but the fault of big government:

"we have these big agencies, some of which are outdated, some of which are not designed properly. . . . The White House is just a tiny part of what is a huge, widespread organization with increasingly complex tasks in a complex world."

The President landed a much needed break from the downward spiraling news cycle with the death of his pretend mentor, Nelson Mandela:

But isn't Mandela truly the anti- or opposite of Obama?  On the non-stop coverage I noted the word patience.  28 years in prison suffering for his cause, and most deserving of leadership when his time finally came.  In leadership, he was  known for healing, compromising, forgiving, and coming together with his former captors.

In contrast is the guy from choomgang and Ivy League affirmative action college subsidies, who never suffered but gave a speech, "Harry, I have a gift", won the Nobel prize before appointing his staff, refused to negotiate with political foes, didn't want or need a single vote of the opposition, shut down the government to avoid negotiating on his signature failure.  The ends always justify means; he praised Lincoln, emulated Nixon.  Ideology means everything, his word means nothing.  His legacy, well we will see, but appears to be the discrediting of his own policies and the bringing together, strengthening and the vindicating of his opponents.  It took this president until his second sentence eulogizing Nelson Mandela to start in with the word "I".

I am one of the countless millions who drew inspiration from Nelson Mandela’s life," Obama said. "Like so many around the globe, I cannot imagine my own life without the example that Nelson Mandela set."  He added: "So long as I live, I will do whatever I can to learn from him."
3729  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Politically (In)correct, Reagan freed Mandela, ended apartheid on: December 08, 2013, 09:29:06 AM
I wonder if the anti-Reagan protestors of the 1980s (or press) now understand that Reagan's determination and success in toppling the Soviet Union led directly to the fall of apartheid.  Conversely, I wonder if or when Mandela understood that his choice in aligning with the worst oppressors was counter-productive in his cause to end oppression.

The New Yorker yesterday:

"Mandela’s release from prison and the collapse of apartheid were direct consequences of the demise of the Soviet Union; the South African regime could no longer rely upon its anticommunism as a counterbalance to its miserable human-rights record."
3730  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Economics: Britain's' Laffer' effect on: December 06, 2013, 01:10:05 PM
False, static scoring of tax rate cuts (and the ignored damage from tax rate increases) needs to hit the trash bin forever.  "Extra growth and changed business behavior will likely recoup 45%-60% of that revenue [From a significant corporate tax rate cut in Britain].  The report says that even that amount is almost certainly understated, since Treasury didn't attempt to model the effects of the lower rate on increased foreign investment or other spillover benefits."

Dec. 5, 2013  WSJ Editorial        (Subscribe at

While America dawdles over tax reform, new evidence from Britain shows that cutting corporate tax rates is a tax revenue winner.

Chancellor of the Exchequer George Osborne has cut Britain's corporate tax rate to 22% from 28% since taking office in 2010, with a further cut to 20% due in 2015. On paper, these tax cuts were predicted to "cost" Her Majesty's Treasury some £7.8 billion a year when fully phased in. But Mr. Osborne asked his department to figure out how much additional revenue would be generated by the higher investment, wages and productivity made possible by leaving that money in private hands.

The Treasury's answer in a report this week is that extra growth and changed business behavior will likely recoup 45%-60% of that revenue. The report says that even that amount is almost certainly understated, since Treasury didn't attempt to model the effects of the lower rate on increased foreign investment or other "spillover benefits." This sort of economic modeling is never an exact science, but the results are especially notable because the U.K. Treasury gnomes are typically as bound by static-revenue accounting as are the American tax scorers at Congress's Joint Tax Committee.

While the British rate cut is sizable, the U.S. has even more room to climb down the Laffer Curve because the top corporate rate is 35%, plus what the states add—9.x% in benighted Illinois, for example. This means the revenue feedback effects from a rate cut would be even more substantial. (more at link)
3731  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Robert Bartley, The Seven Fat Years, and how to do it again - Still Relevant! on: December 06, 2013, 01:00:49 PM
My most referenced economics book, I wish I could just post the whole thing.  If you are interested in this sort of thing, growing our great country out of plowhorse stagnation, go read it!

December 3, 2013
Robert Bartley's 'The Seven Fat Years' - One of the Greatest Economics Books Ever Written
By John Tamny

Ten years ago in the fall of 2003, I finally read Robert Bartley's The Seven Fat Years. An economic history of the booming ‘80s, along with the slow-growth ‘70s that preceded the alleged ‘Decade of Greed," Bartley's book was a masterpiece. Most already know this, but Bartley was the editorial page editor of the Wall Street Journal, and he sadly died ten years ago today.

I was never lucky enough to know Bartley, but he was always kind enough to return an occasional e-mail, including one about interest rates referenced in his book not long before he passed. Though The Seven Fat Years was published in 1992, it remains one of the most useful books an economically interested reader could ever buy. It explains very entertainingly how extraordinarily easy is economic growth, and to read it once again as I did for this belated review is to also see how very visionary was this revolutionary economic thinker.

What were the seven fat years? As Bartley writes early on, they took place from 1983-1990 when "the United States recovered its pre-1973 growth path." Why did it? That's pretty basic, though hard in practice thanks to the third rate thinkers who generally populate Congress and the White House, not to mention the deluded sorts who populate what is an increasingly fraudulent economics profession.

Bartley thankfully wasn't an economist, and possessing a mind not so polluted by charts, graphs and more than worthless measures of economic activity, he understood intimately that economic growth is as simple as keeping the price of work and investment light (taxes), trade among economic actors around the world free, regulation minimal, and the money used to measure real economic activity stable in value. The Seven Fat Years describes how we forgot basic economics in the malaise-ridden ‘70s, only for Bartley and others to revive Classical economics in the ‘80s; thus the 7-year boom.

The book begins with Bartley's observation that "In the years just before 1982, democratic capitalism was in retreat. Its economic order seemed unhinged, wracked by bewildering inflation, stagnant productivity, and finally a deep recession." He went on to note that "Economic confusions and a sense of futility sapped the morale of the Western people; leaders talked of "malaise" in America and "Europessimism" across the Atlantic."

What's so amazing about Bartley's words, or maybe not, is that they could have been written yesterday. History surely repeats itself, or rhymes, and just as Paul Krugman on the left and Tyler Cowen on the right talk at length about economic growth as something no longer attainable, the popular view among economists then was that "America had become a ‘debtor nation' and was declining as previous empires had." No, economic growth is once again as simple as getting the policy mix right. Bartley and a group of economic visionaries that included, but was not limited to Robert Mundell, Arthur Laffer, Charles Kadlec, Jude Wanniski, and Rep. Jack Kemp, authored a revolution that led to Ronald Reagan's election, and an eventual revival of economic growth thanks to a return to simple economic ideas that removed barriers to production.

These economic concepts were referred to then, and are now, as "supply-side" economics. Unfortunately a media that couldn't understand the concepts limited its flawed analysis of supply side to the Laffer (more on Laffer's brilliant contributions in a little bit) Curve, but it was really much more than that. Unlike demand-side thinkers who falsely presume growth is a function of stimulating consumption, Bartley and other Classical thinkers knew otherwise. They correctly understood that all demand is a function of supply, so in order to stimulate demand it was necessary for policymakers to stimulate the supply side of the economy; as in remove the tax, regulatory, trade and monetary barriers to production. It worked as the booming ‘80s revealed.

To read The Seven Fat Years is to know with certitude how very much Bartley would understand the problems of today. That is so because today's problems are in many ways a repeat of what happened in the 1970s. If there's disagreement with Bartley, and there's very little of that, it has to do with his assertion early on that "It seems that prosperity may bring discontents, real and imagined, that in turn consume the prosperity." My own view is that prosperity doesn't so much bring discontent as much as one of its negative tradeoffs is that it makes us flabby, and too often uncaring in terms of whom we vote into office.

Conversely, slow growth always and everywhere authored by government focuses the electorate. Reagan's election was the result of the failures of LBJ, Nixon, Ford, and Carter, and he revived economic growth through the implementation of the Bartley policy mix that President Clinton largely maintained such that the Reagan/Clinton era was marked by substantial growth. A booming economy essentially blinded voters to the importance of policy such that they elected second rate thinkers of the George W. Bush and Barack Obama variety; both presidents having revived the failed policy ideas of the 1970s; the unstable, cheap money that each sought the most consequential when it came to policy that's always inimical to economic growth.

Bartley would understand today precisely because he'd seen all of this before. Indeed, while it's popular to this day among the political and economic commentariat to blame OPEC for rising oil prices in the ‘70s, Bartley righted the false history about oil in correctly putting quotes around ‘oil shocks.' As he and the rest of the Michael 1 (the lower Manhattan restaurant where he, Laffer, Mundell and other leading Classical thinkers frequently talked policy) crowd knew well, oil wasn't suddenly expensive as much as the dollar in which it was priced was cheap.

Bartley wrote that "The real shock was that the dollar was depreciating against oil, against gold, against foreign currencies and against nearly everything else." About OPEC's non-role in an energy ‘crisis' created by U.S. monetary policy, Bartley observed that "In the confusion of the 1970s, no one noticed that OPEC told us plainly what was going to happen after the closing of the gold window." Put more simply, when the Nixon administration delinked the dollar from gold, the dollar's value plummeted on the way to the 1970s commodity boom.

Bartley would understand our present situation well simply because George W. Bush, like Nixon and Carter in the ‘70s, sought a weak dollar. The markets complied owing to the historical truth that presidential administrations always get the dollar they want. It staggers this writer to this day that so many otherwise smart people ascribe nominally expensive oil to OPEC and foreign demand much as smart people felt this way in the ‘70s. It's particularly unsettling that so many on the right who generally believe in free markets buy into this falsehood. Implicit there is that an oil market dating back to the 1860s still hasn't figured out how to match supply with demand. More to the point, when the right incorrectly tie expensive oil to scarcity they are explicitly suggesting ‘market failure' on the part of the energy industry. It would be funny if it weren't so sad.

The money illusion that gave us high oil prices in the ‘70s, and that has given us similarly nosebleed oil in the 2000s brings with it economy-sapping investment implications. Not only is oil everywhere such that it's prosaic, it's also easy to tax for it being of the earth, or stationary as it were.

Later in the book Bartley noted that in the ‘70s "Nearly everyone had bet on constantly rising oil prices." When money is cheap, investment flows into the commoditized wealth that already exists over the stock and bond income streams representing wealth that doesn't yet exist. When oil and commodities are booming, the real economy is struggling. Bartley went on to write that "when money turned tight, the oil price couldn't go up and the loans [made to oil companies] couldn't be repaid." When we return to quality money, and eventually we will given the desire of Americans for growth, oil and commodity based economies here and around the world will face a rude awakening. History always repeats itself, and Bartley would not be fooled by today's energy ‘boom' in much the same way that he and the rest of the Michael 1 crew weren't fooled back in the ‘70s. As he put it, "At Michael 1 these events were not seen as an oil problem but a monetary problem."

Moving to the monetary policy that created the ‘70s crack-up that Bartley described, and that tells the story of the present too, the Michael 1 crowd very much decried Nixon's ill-conceived decision to rob the dollar of its gold definition. Better yet, they understood the change in investor preference from future concepts to the hard wealth of the present that similarly weighs on our economy today. Much as housing and commodities soared under Bush, in the ‘70s there was similarly according to Bartley a rush into "real assets such as gold or real estate."

In the ‘70s the prevailing economic view of a political class utterly confused by the slow growth that resulted from a weak dollar was that the economy needed more of the same. A weak dollar would boost exports despite devaluation always and everywhere existing as the economy-wrecking policy lever of the poorest countries.  The Michael 1 attendees correctly understood that "Money is a veil, and will not change the relative value of a jug of wine and a loaf of bread." To Bartley et al, money's sole purpose was as a measure of value that would facilitate the exchange of bread and wine, thus the importance of stability.

Instead, and pouring gasoline on the fire, the Nixon and Carter years were defined by regular devaluation of the unit of account (the dollar) such that investment dried up, and chaos reigned. Bartley described this era of floating money as a time when "price signals in the real economy would be subject to repeated disturbances that would detract from efficiency and growth." Yes, floating money that was in freefall gave us the growth-deficient ‘70s, but with the resumption of largely stable money in the ‘80s and ‘90s, the economy took off. Since 2000 we've re-entered an era of limp growth; the latter made predictable by a dollar that was both weak and unstable.

Notable about the ‘70s is that just like today, a sagging economy brought out of the woodwork a great deal of monetary mysticism. Milton Friedman's monetarism was rising in popularity then, and while its modern adherents of the Scott Sumner variety in no way measure up to Friedman (about the Nobel Laureate, Bartley wrote that "On most issues - Say's Law, price controls, energy, efficient markets, deficits, Keynes or whatever - he would be entirely at home at Michael 1), it's sad and happy at the same time that economic distress elevates incorrect thinking (Monetarism) as much as it does Classical thinking of the kind that Bartley was so instrumental in reviving.

It's on the subject of Monetarism in The Seven Fat Years that readers will be reminded of Arthur Laffer's certain genius. Monetarism then and now naively presumes that nirvana can be achieved if allegedly ‘wise men' control "the money supply." But as Bartley so helpfully wrote about Laffer's discredit of this failed idea, "Laffer would draw a tiny black box in the corner of a sheet of paper; ‘this is M-1,' currency and checking deposits. Still bigger boxes included money-market funds, then various credit lines. Finally, the whole page was filled with a box called ‘unutilized trade credit' - that is, whatever you can charge on the credit cards in your pocket. Do you really think, he asked, this little black box controls all the others." The Michael 1 crowd understood well that it didn't, but Friedman and other Monetarist thinkers believed it then, much as Sumner and others promote his monetary form of Keynesian mysticism today.

Laffer et al once again didn't bite. As Bartley further explained Laffer's explanation of the quantity theory of money, "The money supply, he insisted, was ‘demand determined.' What the big boxes demanded the little one supplied." Monetarists at present decry the Fed paying interest on reserves (IOR), and while the Fed should not be paying for bank reserves it needlessly created with the imposition of its adolescent QE policies, it does precisely because demand for money is so low. More comically for a truly dangerous theory is the more that money is corrupted by the creation of it clamored for by Monetarists, the lower is the demand for it. Money's sole purpose is as a stable measure of value, but so deluded are Monetarist thinkers by monetary aggregates that they can't see how very much their own policies work against the rising monetary aggregates they desire.

Stable money in terms of value is heavily demanded, and as a result soars in terms of supply, but all of this confuses the Monetarist School. Then as now, monetarists got inflation backwards. Bartley noted that "With big inflation [meaning devaluation - always], for example, consumers would not want to hold currency. They would shift to high-interest deposits not counted in narrow aggregates, or to real assets like real estate or gold, not counted at all. This would mean that demand for money would fall, pull down the statistical aggregate. When the aggregate fell, the Fed would inject more bank reserves, fueling the inflation. Yet if the real economy swung into boom, say because taxes were cut, the demand for money would grow, pushing up the aggregates. Watching the aggregates grow because of higher money demand, the Fed would worry about inflation, choke off bank reserves, curtail the availability of credit, push up interest rates and stop the recovery."

The Reagan policy mix truly took hold in 1983; '83 when the Reagan tax cuts were finally fully implemented, and the economy soared. With a rising economy money demand naturally soared given the tautology that producers are demanding money when they offer up goods and services for sale. As the economy took off Friedman, wedded to a monetary theory that is rooted in confusion about inflation, made the rounds of Wall Street to argue that the recovery was inflationary even though the value of the dollar was on the way up. Rest assured that if and when the U.S. economy emerges from the Bush/Obama disaster, money demand and the aggregates that confused Monetarists will soar again. Modern believers in that which doesn't work like Sumner will first claim that they predicted the boom based on rising aggregates, then they'll claim an inflation problem despite a stronger dollar. Lost on the Monetarist crowd is the simple truth that the stable money values they dismiss are the only path to the rising money in circulation that they're asking for.

Not so the Michael 1 thinkers. Well aware that an economy is a collection of billions of individuals making infinite decisions every millisecond, they weren't so arrogant as to presume to know how many dollars an economy would need. Their solution was a return to quality money defined by gold. As Bartley wrote, the monetary "system needs an ‘anchor,' some method of judging how much money the world needs. If all nations use their monetary policy to fix the currency of nation n, the nth nation can use its monetary policy to anchor the whole system, to gold or some other indicator." Bartley knew well of gold's historical stability, so he called for monetary policy that would stabilize the price of the dollar by virtue of adjusting supply to meet demand; the gold price serving as the market signal that would tell the monetary authority whether there we too many or too few dollars in the system.

The above description brings up another minor disagreement with the author of this most essential of books. Paul Volcker gets a mostly free pass in an economic memoir which refers to him as a ‘saint.' In truth, and Bartley obviously knew this welll, Volcker not only regularly leaked against the Reagan tax cuts, but he also foisted Friedman's monetary policies on the economy in such a way that the Reagan Revolution almost never was. Administrations once again get the dollar they want, and as Reagan was for a strong dollar in the way that Nixon and Carter were not, the markets were going to correct the dollar upward no matter the ‘tight money' policies rooted in quantity theory imposed by Volcker. More to the point, stable money in terms of value has little to do with ‘tight money' as Bartley suggested in the book.  More realistically, stable money is heavily demanded as the unit used in trade and investment, so if stable money is the goal, the supply of the credible currency will naturally rise.

Volcker ultimately abandoned Friedman's Monetarism in late '82 such that the Reagan boom would soon begin, but in waiting until then he nearly made Reagan a one-term president. Notably, when he shed Friedman's failed policies that are perhaps unsurprisingly being revived today, Laffer and Kadlec concluded that he was following some sort of dollar price rule; a stable dollar always necessary for economic growth. Volcker surely looms large in any discussion of the ‘80s economic renaissance, but the story should be more about how he almost suffocated it as opposed to being a major factor in the seven fat years that Bartley chronicled.

It's also sadly true that while a dollar price rule loomed large in the recovery, Reagan and the Michael 1 crowd never achieved their goal of returning the dollar to a gold standard. We have the 2000s to thank for this not having happened, and as Bartley noted, resolving monetary policy in a way that rids the economy of unstable money was "the one big unfinished task of the Seven Fat Years." So true, but Rome wasn't built in a day.

About trade and the mythical ‘trade deficits' that still captivate those in the ever fraudulent economics profession, Bartley noted that "In all the pantheon of economic statistics, there is none so meaningless and misleading." He went on to write that we somehow "have trouble remembering that commerce takes place between consenting adults, that the bargain makes both sides richer in one way or the other. Instead, we tend to view trade as some kind of nationalistic competition." This misunderstanding which presumes that trade is war such that one side weakens the other is the driver of all manner of policy stupidity.

But as Bartley so expertly pointed out (thank goodness once again that he wasn't an economist), "In fact, international transactions are always in balance, by definition." Of course they are. We can only trade insofar as we produce something to trade with. We trade products for products, and our ability to demand that which we don't have is a function of our supplying what we do; that or borrowing from the production of others. All trade once again balances.

Back to trade ‘deficits,' Bartley revealed the absurdity of the calculation. As he wrote, "The export of an airliner is called trade. The export of a share of stock is called foreign investment." Why this is important has to do with his later point that "a rapidly growing economy will demand more of the world's supply of real resources and run a trade deficit." We are able to import a great deal in the U.S. precisely because we're able to export not just goods and services, but shares in our leading companies. With the exception of the Great Depression and other periods where bad policy has repelled foreign capital, we've always run a trade ‘deficit' precisely because the U.S. has been correctly seen by investors as the best locale in which to commit capital.

Of course to the economic and political commentariat, the eagerness of global investors to place their money in the U.S. is seen as a negative. Indeed, so debased is economic commentary today (just as it was then) that the investment inflows are decried as a negative signal for making us a ‘debtor nation.' Horrors! All that investment somehow weakens us. What's more horrific is that economics is generally a highly paid profession.

All of which brings us to worries about the budget deficit that reigned supreme then, and that still captivates far too many thinkers today. Bartley wrote that the "deficit is not a meaningless figure, only a grossly overrated one." Unfortunately, it being overrated means that this "great national myth" impacted policy then, just as it does today.

Rising deficits forced a giveback of some of Reagan's tax cuts, and then in modern times any tax cut is viewed in Washington through the prism of its impact on the deficit. Such an accounting abstraction did not cloud the minds of the grand thinkers at Michael 1. Internationalists all who understood per Mundell that "the only closed economy is the global economy," it was apparent to them that "it's not government borrowing that crowds out the private sector, but government spending."

Remember, a dollar is a dollar, and dollar credit is dollar credit. Dollar credit is everywhere (note this, Monetarists) in the world. Whether a government that tautologically lacks resources borrows or taxes the money it spends is economically of little consequence. Either way, limited capital is extracted from the more productive private sector and the investment driving the latter in favor of often wasteful government consumption. In that case, the only statistic that matters is how much government spends on an annual basis because the number is a clear signal of what the private sector is losing. Deficits are just finance, they're a waste of time, and any sentient being should understand that we'd be much better off economically if we had annual deficits of $500 billion per year out of $600 billion in annual spending, over balanced budgets of $3.5 trillion.

The above is important when we consider that much as it does today, Keynesian thinking dominated economic discussion in the ‘70s when Bartley et al led an intellectual revolt. To Keynesians there's no distinction between government and private sector investment. Ever worshipful of demand, they just want the money spent; hence their support of large government budgets.

Bartley obviously saw all of this in a different light. How the money is spent is crucial, and in response to the industrial policy types who felt then and do now that government should direct investment, Bartley wrote "Rank in order the most likely recipient of capital from an industrial planning bureaucracy:

(A) Steve Jobs's garage.
(C) A company in the district of the most powerful congressman."

Hopefully readers get the point. Government, whether overseen by Republicans or Democrats, is by nature ‘conservative' in the non-ideological sense such that it very much resides in the ‘seen.' If government employees had a clue about what the future of commerce might be they certainly wouldn't be allocating capital from Washington. Instead, they would be making real money investing in the private sector. Government allocation of capital, though said to be stimulative, is logically the opposite. Government spending and investment means that the connected get credit over revolutionary thinkers like Jobs who got started in garages. With the above passage Bartley cleverly exploded the lie that is Keynesian government ‘stimulus.'

About the taxes that governments collect with an eye on redistributing the inflow, Bartley helpfully made plain throughout The Seven Fat Years that high rates of taxation make productive work more expensive. Taxes are a price, or better yet a penalty placed on productive work. To get more work, lower the price. It's that simple.

Looked at in terms of investment, he logically noted that the prospect of a capital gain "is the big jackpot that attracts entrepreneurial vigor." Along those lines he pointed out that "there were no high-tech startup companies founded in 1976, while more than 300 had been founded in 1968." No surprise there. Capital gains taxes were increased in the ‘70s until being reduced in 1978, and then as investors are buying future dollar income streams when they provide capital to entrepreneurs, high taxes on investment combined with dollar devaluation dried up investment altogether.

The economics profession almost to a man and woman elevates consumption above everything else, but there again the non-economist in Bartley revealed the absurdity of the thinking that informs this most worthless of professions. As he put it so well, "If you scraped up $100,000 and used it to buy a Rolls-Royce, you don't get taxed per luxury-driving mile. But if you use it to buy stock, providing the company with investment funds, and then you want to sell it to buy another stock, you only have paper to show for your $100,000, yet you still have to pay a tax." The capital gains tax is anti-company formation, and worse for a political class that worships at the altar of job creation, it's anti-job creation. To put it very simply, there are no companies and no jobs without investment first. We should abolish the capital gains tax.

It was said early on that The Seven Fat Years was quite the book in a visionary sense, and this should be stressed. Bartley wrote it in the early ‘90s when the economy was weak, but throughout had a very optimistic tone about the future. He wrote that "By 1990, a whole subculture was hooking itself together every night, posting messages, information, secrets and insults on tiny bulletin boards of silicon." I was in college at the time, but this in no way described my experience; the point being that a major informer of Bartley's optimism was an Internet future that most then didn't regard, and certainly didn't understand.

About banking, he spent a lot of time on the S&L debacle. He understood that the industry was regulated out of existence through caps on interest rates that could be offered, and then when near extinction, was allowed to swing for the fences; all while overseen by regulators totally and logically unequal to regulating that which they couldn't possibly understand. Bank regulators are the people who couldn't get jobs at banks. Naturally politicians played a role here too (remember the Keating Five?) in protecting errant S&Ls from regulators who were once again unequal to that which they were asked to do.

Where his visionary nature came into play with banking was in his assertion that "the essence of financial safety is diversification. And a financial system that outlaws diversification - breaking finance into a succession of narrow splinters - is a series of disasters waiting to happen." Bartley in a strong sense could see that the regulation of banks was their inevitable undoing; the latter taking place more recently. Bartley would have understood the problems within banks in 2008 very well for having seen what government was doing to them back in the ‘90s.

And to show how history always repeats itself, the response to the S&L crack-up was a great deal more regulation in the form of the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) that economist Lawrence White referred to as "an Act of anger." FIRREA was the Dodd-Frank of its day that in Bartley's words "set out to ‘solve' the crisis of unprofitable thrifts by shrinking thrift profits, through higher insurance premiums, more indirect taxes, higher capital requirements, other increased regulation and a reduction in diversification authority."

Bartley seemed to sense that when we shackle any business with rules we reduce its profits, and with reduced profits, drive away the very talent that makes businesses more financially sound to begin with. Bartley correctly understood that the reforms of the early ‘90s were setting the stage for something much worse down the line, and he was proven very correct.

About the ratings agencies that were wrongly fingered for a financial ‘crisis' that was wholly a creation of government error, Bartley understood what too many did not in 2008. So many were quite eager to blame the drones toiling in agency cubicles for their flawed analysis of bonds that ‘tricked' the best investors in the world. What a laugh. As Bartley put it so well, "No one at Michael 1 would believe an individual bond rater could outguess the collective decisions of the market; if he could, he'd be rich and not have to work in such a stodgy place." So true, and his analysis is a reminder that we truly lost a great thinker when Bartley passed in 2003.

As a keen follower of the dollar, Bartley's brilliant book suggests that he would have foreseen our present economic problems early on. He would have known that spiking oil prices were a function of a cheap dollar that was going to author an economy-sapping rush into hard assets like housing least vulnerable to the devaluation. As a keen follower of finance, he would have known that the dollar's descent foretold major problems in a banking sector that was going to and did chase the money illusion into all manner of finance related to housing. And then having witnessed the wrongheaded re-regulation of the banks in the ‘90s, he likely would have written very presciently about how this was all going to work out.

Writing about the ‘70s toward the end of his book, Bartley observed that in that failed decade "the United States led the world to the brink of economic crisis without ever knowing it. It simply didn't understand what it was doing." Other than his tax cuts, President Bush in many ways mimicked the devaluationist, high spending, heavy regulating policies of Nixon and Carter, and a president who surely didn't know what he was doing similarly led the world into crisis once the results of his policies came to fruition.

It says here that Robert Bartley wrote one of the best economic books of all time in 1992.  For readers who want to understand why the ‘70s and ‘80s were so different economically, including the seven fat years from 1983-1990, they should read his book. Even better, for those who want to understand what happened in the 2000s on the way to an inevitable crack-up, they should also read Bartley's book. History rhymes, and Bartley told the story of the 2000s in 1992.

John Tamny is editor of RealClearMarkets and Forbes Opinions
3732  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Politically (In)correct, Nelson Mandela, RIP on: December 06, 2013, 12:49:50 PM
I agree we need to look at the whole picture and that the whole picture includes some rather unsavory parts.  That said:

a) The system he fought as a terrorist was nasty and brutal-- I've read that parts of the American Revolution were as well;
b) He was in solitary confinement for 18 years (one visitor a year for 30 minutes, one letter every six months IIRC) and in prison for 27 years;
c) He not only came out of this a sane man, but a better man-- and as that better man, unaided by a the American Creed as MLKing  was, articulated a better path, a forgiving path where a vengeful path would have been so much easier-- and divorced his nasty wife Minnie
d) elected democratically, he stepped down after 5 years, apparently not noticeably richer than when he came into office.

He set his own cause back by favoring failed economic polices and aligning with the wrong side, Soviet Union, Arafat etc.  Still, as well-noted above, he was one hell of an important historic figure.
The bulk of his adult life, Nelson Mandela was a failed Marxist revolutionary and leftist icon, the Che Guevara of Africa. Then in his seventies he had the chance to govern. He chose national reconciliation over reprisal, and he thus made himself an historic and all too rare example of a wise revolutionary leader.
3733  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Truth about pre Obamcare, and Rep alternatives IMPORTANT POST on: December 06, 2013, 12:36:40 PM
Doug wrote:


Not mentioned often anywhere are some of the underlying facts:

1) The poor already had unlimited free healthcare in America.  This never was about helping the poorest among us.
2) The old already had coverage.
3) This was mostly to 'help' who didn't want help.
4) The problems with the old system mostly had to do with government already screwing up the market.  Healthcare wasn't a free market before Obamacare.
5) At the time of its passage, Republicans had the popular part in their own alternative - a plan to cover people with pre-existing conditions.  


This is important and needs to be fleshed out.  

1) Exactly how did the poor already have unlimited coverage?
2) "           "      "   "    old     "        "         "             "     ?
3) I would restate this as "this was to tax those who didn't really need much insurance".
4) Of course!  But we need to have specifics e.g. the fragmentation of the national market into 50 markets, exactly what are the limitations on HSAs-- and the benefits, etc
5) Yes, but we need citations of some sort.

Getting back to you with some citations on the above...

1) The poor already had unlimited free healthcare in America.  This never was about helping the poorest among us.
In 1966 welfare recipients of all ages received medical care through the Medicaid program. Medicaid was created on July 30, 1965 under Title XIX of the Social Security Act of 1965.
Health care in the United States, Government Health Programs
    Federal Employees Health Benefits Program
    Indian Health Service
    Veterans Health Administration
    Military Health System / TRICARE
    Medicaid / State Health Insurance Assistance Program (SHIP)
    State Children's Health Insurance Program (CHIP)  ('Children's healthcare isn't just for children anymore!)  The program was designed to cover
        uninsured children in families with incomes that are modest but too high to qualify for Medicaid.
One public hospital here alone spends half a billion a year on unreimbursed medical expenses, 3 million on translators, 100 million on 'foreign born' patients, etc.  
(No one is alleging the poor didn't already receive free health care in America.)

2) The old already had coverage.
The Social Security Act of 1965 authorized Medicare and provided federal funding for many of the medical costs of older Americans.[19] The legislation overcame the bitter resistance, particularly from the American Medical Association, to the idea of publicly funded health care or "socialized medicine" by making its benefits available to everyone over sixty-five, regardless of need, and by linking payments to the existing private insurance system.
[Obamacare was not aimed at the aging; they already have a program.]

3) This was mostly to 'help' those who didn't want help.
"this was to tax those who didn't really need much insurance"
Nothing says personal accountability like a government mandate.
Identify people who don't want to pay their fair share and make illegal to pay only their share.

4) "The problems with the old system mostly had to do with government already screwing up the market.  Healthcare wasn't a free market before Obamacare."
Dec 04 2009:  New CRS Report Shows Government Already Controls 60 percent of Health Care in the U.S.

5) "At the time of its passage, Republicans had the popular part in their own alternative - a plan to cover people with pre-existing conditions."  
The Ryan[plan] ...  would have to "offer guaranteed issue and community rating" and that "insurers would be unable to deny coverage based on pre-existing conditions."
Eric Cantor of Virginia, said high-risk pools and reinsurance programs would “guarantee that all Americans, regardless of pre-existing conditions or past illnesses, have access to affordable care.”
Republicans Have Offered Three Alternative Health Care Reform Bills
August 21, 2009
The “Patients Choice Act” has been referred to the Senate Finance Committee, which is set to release a Democratic-crafted bill from that committee when Congress returns after Labor Day.  In June, DeMint, chairman of the Senate Steering Committee, introduced the “Health Care Freedom Plan,” which was analyzed by the Heritage Foundation. The conservative policy think tank said DeMint’s bill could reduce the number of uninsured by 22.4 million people in five years.  It also provides grants to help people with pre-existing conditions gain access to affordable insurance, and allows Americans to purchase health savings accounts to pay for insurance.

"The result of Obamacare so far is that we are seeing one new enrollee for every 50 who are losing their plan!"
ObamaCare Cancellation to Enrollee Ratio: 50 to 1
Though the number is estimated to eventually hit as high as 10 to 15 million, right now the number of insurance policies canceled due to ObamaCare is 5 million. Wednesday, the Obama administration claimed that 106,185 Americans enrolled in ObamaCare. Except, according to the White House, those are not actual enrollments. Some have not paid for but have only only "selected a marketplace plan." Orwellian nonsense aside, that is still somewhere around a 50-to-1 ratio of cancellations to enrollees.

"Democrats are now upside down in 13 states with contested Senate races in less than a year. "
2014 is one 6 year senate term (Al Franken, et al) since Barack Obama's Hyde Park speech ("We are the ones we've been waiting for", "the moment when the rise of the oceans began to slow and our planet began to heal") and the exciting Dem sweep of 2008.
Of the 14 Republican seats up next year, just one, Susan Collins' seat in Maine, will be held in a state won by President Obama.  The other 13 are in states Mitt Romney won by at least 5 points, and nine of those are in states he won by 15 points or more.
Landrieu's approval rating is now underwater; she tallied only 41 percent of the vote against her GOP opposition. In Arkansas, where advertising on the health care law began early, Sen. Mark Pryor's approval sank to 33 percent, a drop of 18 points since last year. A new Quinnipiac survey showed Sen. Mark Udall of Colorado, who looked like a lock for reelection last month, in a dead heat against little-known GOP opponents. Even a Democratic automated poll from Public Policy Polling showed Sen. Kay Hagan of North Carolina running neck-and-neck against Republican opposition, with her job disapproval spiking over the last two months. These are the types of numbers that wave elections are made of.

Republicans need a pick up of 6.  Democrats are defending seats in 7 states won by Romney,

The median Dem dropoff from 2012 to 2013 elections was roughly 5 points (and it is getting worse).  Democrats must defend 13 Senate seats that Obama carried by 55% or less.

Nothing says repeal and replace like voting the perps out.
3734  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: Pathological Science on: December 06, 2013, 10:46:20 AM
I know Doug looked outside his Minneapolis window and cursed the big oils for all that snow.  grin
We had a lot of rabbits in the area this year.  The wild turkeys were not seen. 
I cursed the carbon producing scum all season.  It is their fault.
Thank God we are going to get a carbon tax.  I really don't mind paying higher prices to compensate oil companies who will be forced to pay this tax.
Nothing grander than financing the Democrat Party.  One third of my life or more already is devoted to their existence.

Yes, 42" of new snow in Two Harbors (by Duluth) with "highs" forecasted below zero.  No one needs to dream of a white Christmas here.  Most cruel is to keep hearing about global warming during this 17 year pause.  Are they nuts?  OTOH, it is a beautiful sunny day in the land of abrupt season changes!  Seems like only 2 days ago we were raking leaves.  Live cam out my frosty living room window this morning:

Snow totals:
3735  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Peggy Noonan: Low Information Leadership on: December 04, 2013, 01:07:10 PM

"...the Obama White House isn’t organized. It’s just full of chatter. Meetings don’t begin on time, there’s no agenda, the list of those invited seems to expand and contract at somebody’s whim. There is a tendency to speak of how a problem will look and how its appearance should be handled, as opposed to what the problem is and should be done about it. "
"...when you apply this to the ObamaCare debacle, suddenly it seems to make sense. The White House is so unformed and chaotic that they probably didn’t ignore the problem, they probably held a million meetings on it. People probably said things like, “We’re experiencing some technological challenges but we’re sure we’ll be up by October,” and other people said, “Yes, it’s important we launch strong,” and others said, “The Republicans will have a field day if we’re not.” And then everyone went to their next meeting. And no one did anything. And the president went off and made speeches."
"If they thought he wasn’t very bright, they might give him some leeway on that question. [Lying, not knowing etc.] But they think he’s really smart.  So they think he knew.  And deliberately misled."
3736  Politics, Religion, Science, Culture and Humanities / Politics & Religion / The Blaze has more visitors than on: December 04, 2013, 12:32:47 PM
After the Obama administration bragged of the traffic the new and improved website is handling, Glenn Beck pointed out that The Blaze has more visitors in that period of time than
3737  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Politics of Health Care, Eliana Johnson: In the Trenches With the ObamaCare Army on: December 04, 2013, 12:30:04 PM
Eliana Johnson: In the Trenches With the ObamaCare Army
One group of navigators planned to sign up 5,800 people by March. So far: zero.

From the article:  "We have yet to see an application from start to finish," he says.

A good piece of journalism, I believe this is young Eliana's first time making the WSJ opinion page.
3738  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Media Issues: IRS Flagged Groups for Anti-Obama Rhetoric, ABC, CBS, NBC slient on: December 04, 2013, 12:24:41 PM
Does anyone have an update to this story, of when the MSM, ouside of a WSJ opinion piece, has properly covered this bombshell?

IRS Documents Reveal Agency Flagged Groups for 'Anti-Obama Rhetoric,' Big Three Refuse to Report

ABC, CBS and NBC have so far refused to report the latest bombshell in the IRS scandal - a newly released list from the agency that showed it flagged political groups for "anti-Obama rhetoric." On September 18 USA Today, in a front page story, reported the following: "Newly uncovered IRS documents show the agency flagged political groups based on the content of their literature, raising concerns specifically about 'anti-Obama rhetoric,' inflammatory language and 'emotional' statements made by non-profits seeking tax-exempt status."

Not only have ABC, CBS and NBC not reported this story they've flat out stopped covering the IRS scandal on their evening and morning shows. It's been 85 days since ABC last touched the story on June 26. NBC hasn't done a report for 84 days and CBS last mentioned the IRS scandal 56 days ago on July 24.

I tried searching NY Times - nothing.
3739  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Wesbury: You guys are still wrong on: December 04, 2013, 12:09:42 PM
At this Plowhorse growth rate, we will grow out of this economic funk, ... um ... never.

"New home construction is up 20.8% from last year."  Stated differently:  Except for the other Obama years, this year was the worst year since data has been kept in the US.  We had more new home construction during the Jimmy Carter years at 22% interest rates than we do now.

Wesbury  9-5-2013:  "What we have here is a Plow Horse Economy that looks like it may be starting to trot."
Wesbury 12-2-2013:  "The Plow Horse Economy continues to move forward."  (not 'starting to trot'?)

Plowhorses don't trot; they just pull heavy loads until they die.  A pretty good analogy, come to think of it.
3740  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Politics of Health Care on: December 04, 2013, 10:54:06 AM
I share your frustration.  Still it is important to lay the blame for Obamacare on those who support it, not those who oppose it.

Ben Carson had it right.  If Obama is going to continue to sell it, Republicans especially in the Senate should be calling for a new authorization vote to see how that sale is going.

What is wrong with Obamacare was not a bogged down website, it is the whole concept from start to finish, mostly the fact that we are handing our individual liberties, choices and privacy over to the government never to get them back.

The problems before Obamacare were two-fold:  Not enough people insured and healthcare costs were going up too fast.  Too many young people who could afford it were uninsured because they thought it was a lousy value; they would be paying for other people's problems and for a lot of coverage they didn't think they needed.

Enter Obamacare.  It makes all of that much worse in price and desirability but adds a government mandate, enforced by the IRS, that is just about to go into effect - or be delayed like everything else.

Not mentioned often anywhere are some of the underlying facts:

1) The poor already had unlimited free healthcare in America.  This never was about helping the poorest among us.
2) The old already had coverage.
3) This was mostly to 'help' who didn't want help.
4) The problems with the old system mostly had to do with government already screwing up the market.  Healthcare wasn't a free market before Obamacare.
5) At the time of its passage, Republicans had the popular part in their own alternative - a plan to cover people with pre-existing conditions.  

The result of Obamacare so far is that we are seeing one new enrollee for every 50 who are losing their plan!

Republicans disagree on tactics for ending the failed program, and the clock is ticking.  As ccp suggest, a number of people and groups are going to come to rely on it making repeal harder later.

Democrats are now upside down in 13 states with contested Senate races in less than a year.  

Obamacare needs to be repealed by the people left who passed it - Democrats.  Where is their plan?

If we merely legalize free choice in a free country, the government plans can compete on a level playing field.

With Obamacare in place we get this, the central planners method of allocating scarce resources, replacing individual choice:

Please read the details that explain the chart at this pdf!
3741  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: Economics on: December 03, 2013, 09:05:51 AM
The Catholic Church has a long history of such corporatist (fascist) thinking.

This is sad to me.  I am only a non-member who sometime attends but a good part of my family is Catholic.  I understand that people had failed views of economics centuries ago, but we have quite a bit of new data since then.  Economic Freedom and capitalism have lifted billions(?) of people up out of poverty.  Big Government, and even charity, has lifted up virtually none.
3742  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: Economics - Pope Francis expresses economic views on: December 02, 2013, 02:27:42 PM
People who dismiss the importance of the pontiff and his views on other matters such as gay rights, abortion and birth control are suddenly quite exuberant to hear Pope Francis disparage "trickle-down theories".   (  Before I can really comment, I will need to read what is written in its entirety  sad  and learn if there is a question about context and meaning coming through the media reports, such as this one:
Pope Francis denounces ‘trickle-down’ economic theories in critique of inequality

Kevin Williamson at National Review wrote: 

"... But there is no reason for Pope Francis to take that view [all power relationships as zero-sum: If somebody else gets a little more power, he has a little less]. If ever the Church’s economic thinkers get over their 19th-century model of the relationship between state and market, they might appreciate that spontaneous orders and distributed economic forces could produce some truly radical outcomes in a world in which a billion or more people shared a vision of justice and mercy. The pope’s job in part is to supply that vision; unhappily, the default Catholic position seems to be delegating economic justice to the state, under the mistaken theory that its ministers are somehow less selfish than are the men who build and create and trade for a living rather than expropriate. Strange that a man who labored under the shadow of Perón has not come to that conclusion on his own."

The Pope is quite right (IMHO) to criticize the worship of money and materialism:

He is out of his realm to think that a lifetime of studying poverty (the lack of wealth creation) leads to very much insight into the creation of wealth, which is the pathway out of poverty.

Most offensive to me is the (media) implication that he supports government programs that emphasize collective taking, not individual giving.

Ed Morrisey of Hot Air took the time to read Evangelii Gaudium and says that this is not a new turn toward socialism or communism.
3743  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Mark Steyn: Ice Everywhere, But No Hockey Sticks on: December 02, 2013, 01:49:41 PM
Ice Everywhere, But No Hockey Sticks
By Mark Steyn    December 2, 2013 
News from Santa’s Grotto:  (

    Global warming hysterics at the BBC warned us in 2007 that by summer 2013, the Arctic would be ice-free. As with so many other doomsday predictions by warmists, the results turn out to be quite the opposite.

Meanwhile, down the other end at Santa’s summer vacation condo:  (

    Antarctic sea ice has grown to a record large extent for a second straight year, baffling scientists seeking to understand why this ice is expanding rather than shrinking in a warming world.

Antarctic ice is now at a 35-year high. But scientists are “baffled” by the planet’s stubborn refusal to submit to their climate models. Maybe the problem with Nobel fantasist Michael Mann’s increasingly discredited hockey stick is that he’s holding it upside down.  (

Nonetheless, the famously settled science seems to be re-settling:  (

    Scientists Increasingly Moving To Global Cooling Consensus

Global warming will kill us. Global cooling will kill us. And if it’s 54 and partly cloudy, you should probably flee for your life right now. Maybe scientists might usefully consider moving to being less hung up on “consensus” – a most unscientific and, in this context, profoundly corrupting concept.
3744  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: 2016 Presidential - Scott Walker continued on: December 02, 2013, 01:43:10 PM
I haven't seen him speak very much.  I assume he has governing competence but not much charisma.  This is his 'Face the Nation' appearance yesterday.  I think he is quite steady, decisive and articulate.  Definitely a serious candidate to contend with if he wins reelection and enters the Presidential race, IMHO.

Coincidentally, George Will on Scott Walker:

Scott Walker, Wisconsin’s action governor

By George F. Will, Published: November 29 2013

In 2011, thousands of government employees and others, enraged by Gov. Scott Walker’s determination to break the ruinously expensive and paralyzing grip that government workers’ unions had on Wisconsin, took over the capitol building in Madison. With chanting, screaming and singing supplemented by bullhorns, bagpipes and drum circles, their cacophony shook the building that the squalor of their occupation made malodorous. They spat on Republican legislators and urinated on Walker’s office door. They shouted, “This is what democracy looks like!”

When they and Democratic legislators failed to prevent passage of Act 10, they tried to defeat — with a scurrilous smear campaign that backfired — an elected state Supreme Court justice. They hoped that changing the court’s composition would get Walker’s reforms overturned. When this failed, they tried to capture the state Senate by recalling six Republican senators. When this failed, they tried to recall Walker. On the night that failed — he won with a larger margin than he had received when elected 19 months earlier — he resisted the temptation to proclaim, “This is what democracy looks like!”

Walker recounts these events in “Unintimidated: A Governor’s Story and a Nation’s Challenge” (co-authored by Post columnist Marc Thiessen). Most books by incumbent politicians are not worth the paper they never should have been written on. If, however, enough voters read Walker’s nonfiction thriller, it will make him a — perhaps the — leading candidate for his party’s 2016 presidential nomination.

Act 10 required government workers to contribute 5.8 percent of their salaries to their pensions (hitherto, most paid nothing) and to pay 12.6 percent of their health-care premiums (up from 6 percent but still just half of what the average federal worker pays). Both percentages are well below the private-sector average. By limiting collective bargaining to base wages, Act 10 freed school districts to hire and fire teachers based on merit, and to save many millions of dollars by buying teachers’ health insurance in the competitive market rather than from an entity run by the teachers’ union. Restricting collective bargaining to wages ended the sort of absurd rules for overtime compensation that made a bus driver Madison’s highest paid public employee.

Act 10’s dynamite, however, was the provision ending the state’s compulsory collection of union dues — sometimes as high as $1,400 per year — that fund union contributions to Democrats. Barack Obama and his national labor allies made Wisconsin a battleground because they knew that when Indiana made paying union dues optional, 90 percent of state employees quit paying, and similar measures produced similar results in Washington, Colorado and Utah.

Walker has long experience in the furnace of resistance to the looting of public funds by the public’s employees. He was elected chief executive of heavily Democratic Milwaukee County after his predecessor collaborated with other officials in rewriting pension rules in a way that, if he had been reelected instead of resigning, would have given him a lump-sum payment of $2.3 million and $136,000 a year for life.

To fight the recall — during which opponents disrupted Walker’s appearance at a Special Olympics event and squeezed Super Glue into the locks of a school he was to visit — Walker raised more than $30 million, assembling a nationwide network of conservative donors that could come in handy if he is reelected next year. Having become the first U.S. governor to survive a recall election, he is today serene as America’s first governor to be, in effect, elected twice to a first term. When he seeks a second term, his opponent will probably be a wealthy rival who says her only promise is to not make promises. This is her attempt to cope with an awkward fact: She will either infuriate her party’s liberal base or alarm a majority of voters by promising either to preserve or repeal Act 10.

Walker is politely scathing — a neat trick — of Mitt Romney’s campaign, especially of Romney’s statement that “I’m not concerned about the very poor” because “we have a very ample safety net.” The imperative, Walker says, is to “help them escape the safety net.”

“Outside the Washington beltway,” he says pointedly, “big-government liberals are on the ropes.” No incumbent Republican governor has lost a general election since 2007. Since 2008, the number of Republican governors has increased from 21 to 30, just four short of the party’s all-time high reached in the 1920s. He thinks Republican governors are in tune with the nation. If reelected, he probably will test that theory.
3745  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: marijuana gossip on: December 02, 2013, 01:33:07 PM
The Motley Fool
 5 Jaw-Dropping Facts About Legal Marijuana

I have favored 'de-criminalization' over legalization, a subtle but important difference.

"On #1   Best selling drug?  Who would grow it and sell it?"  Anyone with a profit motive.

"On #2  Kind of sad that the driving force for legalization is tax revenue. "  Agree

"On #3 I didn't know the government was sponsoring studies on use of marijuana for glaucoma.  It can lower intra-orbital pressures but my understanding is the affects were too erratic and there are so many better drugs that the use for this is dubious."   I believe they can measure and control dosage much better now. (And it's going up at an alarming rate!)

"Hashish IS NOT addictive, it's basically the resin from the marijuana flower and is nothing more than a more potent delivery device for THC."  Addictive and habit-forming are synonyms.

"5 other jaw breaking facts about marijuana.
1. It has 424 compounds that turns into over 2000 when lit.
2. Those 2000 compounds release numerous poisons including hydrogen cyanide and carbon monoxide."

They now vaporize - heat only to the temp that releases the drug - and not light it.  Releases fewer toxins.

"kids under 21 should not get access and should be treated like booze and advertising should be the same as tobacco when it comes to kids." Agree, but good luck with that when it is available everywhere.  See my first point, decriminalize it, not endorse it.
3746  Politics, Religion, Science, Culture and Humanities / Politics & Religion / US-China: A Military Strategy to Deter China on: December 02, 2013, 01:12:23 PM
BD's post of a Russia-Japan alliance is quite interesting.  I'm sure it is too provocative for the US administration to talk publicly about a military conflict with China, but I would hope we have a plan in place.  This seems like a thoughtful piece on the subject.

A Military Strategy to Deter China    By T.X. Hammes

China’s announcement of an Air Defense Identification Zone last weekend made Seth Cropsey’s commentary “America Has No Military Strategy for China” extremely timely.  He is absolutely correct on two key statements.  First, an escalation between China and Japan would be disastrous and, even more importantly, the United States has no strategy for a conflict with China.  Secretary Cropsey notes that the AirSea Battle concept is the “sole U.S. preparation” but that it is not a strategy.

While no set of actions can guarantee continued peace between China and the United States, carefully considered national and military strategies will reduce the probability of a conflict.  The United States National Strategy makes that an explicit goal.  In his November 2011 address to the Australian Parliament, President Barack Obama stated U.S. National Strategy would:

“continue our effort to build a cooperative relationship with China.  … all of our nations have a profound interest in the rise of a peaceful and prosperous China.”

This year, Tom Donilon, the National Security Advisor, clarified and reinforced the Administration’s determination to continue its rebalance to Asia.

“To pursue this vision, the United States is implementing a comprehensive, multidimensional strategy: strengthening alliances; deepening partnerships with emerging powers; building a stable, productive, and constructive relationship with China; empowering regional institutions; and helping to build a regional economic architecture that can sustain shared prosperity.”

Thus, the United States has a clearly articulated national strategy to encourage peaceful growth in the region. Unfortunately, as Cropsey noted, the United States has failed to express a coherent military strategy to support its national strategy.

Deepening the confusion concerning U.S. military strategy is the tendency of many observers to assume that CSBA’s paper, AirSea Battle: A Point-of-Departure Operational Concept, expressed the U.S. military strategy for a conflict with China.  The paper postulated that in the “unthinkable” case of a war with China, U.S. efforts would include a “executing a blinding campaign against PLA battle networks, executing a suppression campaign against PLA long-range, principally strike systems, seizing and sustaining the initiative in air, sea, space and cyber domains.” This paper stated it was not proposing a strategy but only a concept for overcoming China’s area denial/anti-access capabilities.

Perhaps the biggest weakness of the ASB concept is that it scares our allies without deterring China.  Since most ASB technology is top secret, U.S. officials are unable to discuss it with our allies.  As a result, many allies assume the United States will follow the plan described in CSBA’s paper and initiate immediate, extensive attacks on Chinese territory. Our allies are obviously concerned that China will see such attacks as emanating from allied territory and respond in kind.  In short, U.S. allies are being asked to offer bases without any knowledge of what actions the U.S. intends to take from those bases.  Not a great way to reassure allies. Unfortunately because this operational approach relies heavily on cyber and space capabilities, it creates the unintended consequence of raising the value of a first strike.  Thus it is escalatory.  In a crisis, both militaries will know that the one that strikes first will achieve significant tactical and operational advantages.

ASB also fails to deter China.  Because it is apparently dependent upon space and cyber systems, China may well feel it can degrade those systems enough to defeat the operational approach.  Further, China may well believe the United States cannot afford ASB or at very least will not field the capabilities for a decade or more.  A military strategy that offers a relative inexpensive defeat mechanism or a window of vulnerability has little deterrent value.

To eliminate the confusion and reassure other nations, the United States needs to go beyond simply declaring that ASB is not a strategy.  It must clearly state U.S. military strategy for a possible conflict with China.

What Should a Military Strategy Do?

The first and most important function of a military strategy is to support the national strategy.  Therefore, any military strategy must encourage or, at very least, not discourage the continued growth and integration of China’s economy with that of the global economy.  A U.S. military strategy for Asia must achieve five objectives:

1. Deter China from military action to resolve disputes while encouraging its continued economic growth;

2. Assure Asian nations that the United States is both willing to and capable of remaining engaged in Asia;

3. Ensure access for U.S. forces and allied commercial interests to the global commons;

4. Achieve victory with minimal risk of nuclear escalation in the event of conflict; and

5. Be visibly credible today.

Ideally, a military strategy would also provide guidance for matching limited defense resources to appropriate force structures and equipment buys. Given the fact that China has a thermonuclear arsenal, a military strategy must emphasize deterrence and, if that fails, should escalate in a deliberate, transparent way.

Outline for a Strategy

Professor Eliot Cohen proposes that a strategy should include critical assumptions, ends-ways-means coherence, priorities, sequencing, and a theory of victory. Without listing, examining and challenging assumptions, it is not possible to understand a strategy. With assumptions identified, coherence in ends-ways-means becomes possible. These elements should not be treated separately.  If goals are selected that exceed available means, one does not have a strategy.  Priorities are required because a nation will not have the resources to do everything at once.  Sequencing flows from priorities.  Finally, a strategy must have a theory of victory – an answer to the question “how does this end?” It must express how the strategy achieves war termination on favorable terms.

A Proposed Military Strategy

I propose a military strategy I am calling Offshore Control: Defense of the First Island Chain that takes advantage of geography to block China’s exports and thus severely weaken its economy. 


I have listed five key assumptions below.

1. China starts the conflict.  Assuming China initiates the conflict presents the most difficult military situation for the United States.

2. There is a high probability that a conflict with China will be a long war.  For the last 200 years, wars between major powers have generally run for years rather than months.  Further, the United States would find a protracted conflict most challenging.

3. Any major conflict between the United States and China will result in massive damage to the global economy.  The integrated global economy means that, like WWI, the opening of the conflict will cause major economic contraction.

4. The United States does not understand China’s nuclear decision process.  Therefore, it is critically important that the U.S. strategic approach minimize escalation.  If escalation is required, deliberate and transparent escalation is better than a sudden surprise that could be misinterpreted.  This approach certainly violates the generally accepted precept that escalation in war be violent and sudden to achieve maximum effect.  However, that maxim was developed before the advent of offsetting nuclear arsenals.

5. In space or cyber domains, a first strike provides major advantages.  Thus any operational approach that requires the robust use of space and cyber capabilities is inherently destabilizing in a crisis.

Ends, Ways, and Means Coherence

The combination of decreasing defense budgets and rapid increases in procurement costs for new weapons suggests a strategy for conflict with China should assume limited means, at least to start.  In addition to limited means, the United States must accept that China’s nuclear arsenal imposes restrictions on the way American forces may attack Chinese assets.  The United States must select ways that minimize the probability of escalation to nuclear conflict simply because no one can win in a major nuclear exchange. With limited means and restricted ways, the ends selected therefore also should be modest.   They must attain U.S. strategic goals but not risk a major nuclear exchange.

This logic leads to the concept of Offshore Control.  Operationally, Offshore Control uses currently available but limited means and restricted ways to enforce a distant blockade on China.  It establishes a set of concentric rings that denies China the use of the sea inside the first island chain, defends the sea and air space of the first island chain, and dominates the air and maritime space outside the island chain.  No operations will penetrate Chinese airspace.  Prohibiting penetration is intended to reduce the possibility of nuclear escalation and make war termination easier.

The denial element of the campaign plays to U.S. strengths by employing primarily attack submarines, mines, and a limited number of air assets inside the first island chain.  This area will be declared a maritime exclusion zone with the warning that ships in the zone will be sunk.  While the United States cannot initially stop all sea traffic in this zone, it can prevent the passage of large cargo ships and tankers.  In doing so, it cripples China’s export trade, which is central to China’s economy.

The defensive component will bring the full range of U.S. assets to defend allied soil and encourage allies to contribute to that defense.  It takes advantage of geography to force China to fight at longer ranges while allowing U.S. and allied forces to fight as part of an integrated air-sea defense over their own territories. In short, it flips A2/AD to favor allies rather than China.  Numerous small islands from Japan to Taiwan and on to Luzon provide dispersed land basing options for air and sea defense of the apparent gaps in the first island chain. Since Offshore Control will rely heavily on land-based air defense and short-range sea defense to include mine and counter-mine capability, we can encourage potential partners to invest in these capabilities and exercise together regularly in peacetime. 

In keeping with the concept that the strategy must be feasible in peacetime, the United States will not request any nation to allow the use of their bases to attack China.   The strategy will only ask a nation to allow the presence of U.S. defensive systems to defend that nation’s air, sea, and land space.   The U.S. commitment will include assisting with convoy operations to maintain the flow of essential imports and exports in the face of Chinese interdiction attempts.

The dominate phase of the campaign will be fought outside the range of most Chinese assets and will use a combination of air, naval, ground and rented commercial platforms to intercept and divert the super tankers and post-Panamax container ships essential to China’s economy.   Eighty percent of China’s imported oil transits the Straits of Malacca.  If Malacca, Lombok, Sunda and the routes north and south of Australia are controlled, these shipments can be cut off.  This reduction in energy supply will have a negative effect on China’s economy.

However, the United States must recognize that the dramatic reduction in China’s trade will significantly reduce its energy demands.  Thus, energy interdiction is not a winning strategy.  Exports are of much greater importance to the Chinese economy.  Those exports rely on large container ships for competitive cost advantage.  These ships also are the easiest to track and divert. Naturally, China will respond by rerouting, but the only possibilities are the Panama Canal and the Straits of Magellan – or, if polar ice melt continues, the northern route.  U.S. assets can control all these routes. While such a concentric campaign will require a layered effort from the straits to China’s coast, it will mostly be fought at a great distance from China—effectively out of range of most of China’s military power.


That leads us to modest ends.  Offshore Control is predicated on the idea that the presence of nuclear weapons makes seeking the collapse of the Chinese Communist Party or its surrender too dangerous to contemplate.  The United States does not understand the Communist Party decision process for the employment of nuclear weapons but it does know the Party is adamant it must remain in control of China.  Thus, rather than seeking a decisive victory against the Chinese Communist Party, Offshore Control seeks to use a war of economic attrition to bring about a stalemate and cessation of conflict with a return to a modified version of the status quo.

Theory of Victory

Offshore Control seeks termination of the conflict on U.S. terms through China’s economic exhaustion without damage to mainland China’s infrastructure or the rapid escalation of the conflict.  It seeks to allow the Chinese Communist Party to end the conflict in the same way China ended its conflicts with India, the United Nations in Korea, the Soviet Union, and Vietnam.  It allows China to declare it “taught the enemy a lesson” and thus end the conflict. Offshore Control does not seek decisive victory in the traditional military sense but secures U.S. objectives effectively.  It recognizes the fact that the concept of decisive victory against a nation with a major nuclear arsenal is fraught with risks if not entirely obsolete.


President Obama has presented a U.S. national strategy that sets goals and the diplomatic, economic and political paths necessary to achieve them.  While one can argue about how effectively they are being executed, the diplomatic, economic, and political paths have been defined.  However, the United States has failed to articulate a coherent military strategy to support its national strategy.  It is time to correct that deficiency.  Offshore Control: Defense of the First Island Chain is a starting point for a discussion with our allies and friends in the region.  It seeks to provide the military component of the U.S. national strategy in Asia.

The major goal of Offshore Control is to deter China by presenting it with a military strategy that cannot be defeated. This directly addresses one of the most worrying aspects of the current situation in Asia.  Like the Germans before WWI, the Chinese may believe they can win a short war.  In particular, they may believe their growing capabilities in space and cyber might neutralize U.S. power in the region.  By showing that Offshore Control can be executed with today’s force even with dramatically reduced access to space and cyber, the United States and its allies can dispel the notion of a short war.  The only way China can defeat such a strategy is to invest hundreds of billions of dollars over a decade or more to create a global sea control navy.  And even that will not be a guarantee it wins such a conflict.

T. X. Hammes served 30 years in the Marine Corps and is now a Distinguished Research Fellow at the Institute for National Security Studies at the National Defense University (NDU).
3747  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Life and Death: Typhoon Haiyan: How a Catastrophe Unfolded, Philippines on: December 01, 2013, 09:59:35 AM
This WSJ piece begins to tell the story of the massive storm last month:

3748  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Mark Steyn, always funny, Dissent is the Highest Form of Tax Bracket on: December 01, 2013, 09:43:40 AM

In Ian Fleming’s Goldfinger, the eponymous Auric Goldfinger observes:

    Once is happenstance. Twice is coincidence. Three times, it’s enemy action.

That may be overly generous.

A couple of weeks back, cancer patient Bill Elliot, in a defiant appearance on Fox News, discussed the cancelation of his insurance and what he intended to do about it. He’s now being audited.

Insurance agent C Steven Tucker, who quaintly insists that the whimsies of the hyper-regulatory bureaucracy do not trump your legal rights, saw the interview and reached out to Mr Elliot to help him. And he’s now being audited.

As the Instapundit likes to remind us, Barack Obama has “joked” publicly about siccing the IRS on his enemies. With all this coincidence about, we should be grateful the President is not (yet) doing prison-rape gags.

Meanwhile, IRS chief counsel William Wilkins, in his testimony to the House Oversight Committee over the agency’s systemic corruption, answers “I don’t recall” no fewer than 80 times. Try giving that answer to Wilkins’ colleagues and see where it gets you. Few persons are fond of their tax collectors, but, from my experience, America is the only developed nation in which the mass of the population is fearful of its revenue agency. This is unbecoming to a supposedly free people.
3749  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Trade Issues / Freedom to Trade on: December 01, 2013, 09:41:30 AM
This anti-NAFTA article, 'not necessarily the view of', makes a couple of valid points:
"genuine free trade doesn’t require a treaty"
"The worst aspects of Nafta are the Clintonian side agreements"

At the time, I was in the international trade business and believed that a true, free trade agreement could be written on the back of a cocktail napkin, not in a 2000 page document.  It is the rest of the Obamacare-like details of NAFTA that were harmful, not the free trade aspect.

On the other hand, the real alternative to free trade agreements is the continuation of trade barriers mostly designed to keep US goods out of other countries.
3750  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Political Economics: Barack Obama has the U.S. economy on lockdown on: November 29, 2013, 11:55:34 AM
"The no-decision on the Keystone XL pipeline and its union jobs; the 2,000-page regulatory law draped in 2010 across the entire financial sector; the shutdown in 2010 and then the slow-walking of offshore oil drilling; siccing the EPA on the utilities industry and the National Labor Relations Board on all industry; a 2010 FCC decision to regulate Internet growth; a significant tax increase this year; support this month for jacking up the federal minimum wage to over $10, certain to smother new jobs; the Justice Department's $13 billion looting of J.P. Morgan JPM -0.47% bank; and of course Hurricane ObamaCare."

Daniel Henninger: Worse Than ObamaCare
Obama's biggest failure is that he hobbled the U.S. economy.  More at the link:
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