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4851  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Immigration issues - 4 conservative Senators outline opposition to current bill on: June 05, 2013, 10:05:57 AM
Cruz: 'No Choice But to Oppose' Gang of Eight Legislation    June 4, 2013

Ted Cruz (R., Texas) joined three Republican Senators on Monday in strongly denouncing the Gang of Eight immigration reform bill. In a letter to colleagues, Cruz, along with Senators Mike Lee (R., Utah), Chuck Grassley (R., Iowa), and Jeff Sessions (R., Ala.), wrote that the proposed legislation would “leave our borders unsecure and our immigration system deeply dysfunctional.”

The letter contains a detailed explaination of amendments offered during the bill’s markup in the Judiciary Committee that the senators argue would have significantly improved the legislation, but were rejected, as well as a number of amendments that were adopted, but simpy “exacerbated” the “already serious flaws” with the existing bill.

The letter criticizes the Gang of Eight directly, and the “deal” struck by its members to ensure that “the core provisions of the bill remain the same,” arguing that the legislation, like Obamacare, was “negotiated behind closed doors with special interests.”

The senators list the following reasons for their decision to oppose the bill:

    It provides immediate legalization without securing the border.
    It rewards criminal aliens, absconders, and deportees, and undermines law enforcement.
    It contains extremely dangerous national-security loopholes.
    It facilitates fraud in our immigraiton system.
    It creates no real penalties for illegal immigrants and rewards them with entitlements.
    It delays for years the implementation of E-Verify.
    It does not fix our legal-immigration system.
    It advanced through a process predicated on a deal struck before markup.
    It rewards those who have broken our laws by offering a special path to citizenship.

The senators stress that they do not oppose the concept of immigration reform; they just cannot support the Gang’s proposal. ”We need immigration reform, but the American people deserve better than a 1,000-page bill that makes our immigration system more complex and less accountable without truly ensuring border security,” they write. “[The proposed bill] fails to deliver anything more than the same empty promises Washington has been making for 30 years.”

Link to the letter:
4852  Politics, Religion, Science, Culture and Humanities / Politics & Religion / AEI: Where Are the Entrepreneurs? Evidence that the US economy is failing! on: June 05, 2013, 09:55:07 AM
Famous people caught reading the forum?  AEI comes to the defense of my previously unsubstantiated claim that in the face of our unprecedented regulatory climate, the business startup rate is the worst in our nation's history.  I'm not talking about LLCs filed for existing assets or one person operations, but referring to the dearth of real entrepreneurs risking real capital to give birth to new businesses that hire new employees.  Implementation of Obamacare is one more step taking us further from having a dynamic economy with full employment and full time employees.  Meanwhile, Wesbury dwells on the performance of the unchallenged, entrenched companies with their teams of regulatory compliance officers replacing innovation in the pursuit of zero-sum profits.  Good luck America.

Where are the entrepreneurs? More evidence the very heart of the US economy is failing
James Pethokoukis | June 3, 2013  AEI

America makes a grievous error if it dismisses the weak economic expansion — this month marks the fourth anniversary of the end of the Great Recession – as nothing more than the expected aftermath of a deep downturn and financial crisis. Sluggish GDP growth and yet another “jobless” recovery point to a secular problem rather than merely cyclical forces at work.

The US entrepreneurial spirit may be faltering. Check out these data points from The Wall Street Journal: a) In 1982, new companies made up roughly half of all US businesses, according to census data. By 2011, they accounted for just over a third; b) from 1982 through 2011, the share of the labor force working at new companies fell to 11% from more than 20%; c) Total venture capital invested in the US fell nearly 10% last year and is still below its prerecession peak, according to PricewaterhouseCoopers.

New companies are best at creating what business guru Clayton Christensen has termed “empowering innovation” (creating new consumer goods and services) as opposed to process innovation (creating cheaper, more efficient ways to make existing consumer goods and services). Empowering innovation produces new jobs, while efficiency innovation eliminates them, often through automation.

Don’t let Apple and Google and Facebook fool you. Right now, Christensen wrote in The New York Times last year, “efficiency innovations are liberating capital, and in the United States this capital is being reinvested into still more efficiency innovations. In contrast, America is generating many fewer empowering innovations than in the past.”

Not only do we need a vibrant entrepreneurial ecosystem so startups can flourish and generate disruptive innovation, these new entrants raise the competitive intensity for established players to become more innovative. In other words, explains banker and entrepreneur Ashwin Parameswaran, “unless incumbent firms face the threat of failure due to the entry of new firms, product innovation is unlikely to be robust. The role of failure in fostering product innovation has sometimes been called the ‘invisible foot’ of capitalism.” Big business must be subject to maximum competitive intensity.

In the WSJ piece, reporter Ben Casselman offers several possible causes for the decline in risk taking from the aging of the US population to rising health care costs to increased state and local licensing requirements: “One recent study found that roughly 29% of U.S. employees required a government license or certificate in 2008, up from less than 5% in the 1950s.” Parameswaran thinks Washington’s backstop of “too big to fail” banks play a role by encouraging the financial sector to take on macroeconomic risk of the sort the Federal Reserve worries about (housing, derivatives) rather than lending to small business or new firms. Another factor could be restrictive land-use regulations that prevent our most productive cities from being as populous as they could be. And Christensen sees schools at all levels failing to teach the “skills necessary to start companies that focus on empowering innovations.”

US workers need America to be as entrepreneurial and innovative as possible. So does the global economy. But right now we are taxing capital, educating kids, regulating banks, and managing cities in ways that are crippling America’s greatest economic asset.
4853  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Media Issues, James Rosen is not blameless on: June 04, 2013, 11:29:25 AM
Robert's post makes a good point, IMO.  When it was the NY Times leaking national secrets, some of us were quick to criticize them.  Just because Rosen was able to get inside or classified info doesn't mean it should have been published or broadcasted.  Fred Kaplan at Slate made this point recently: /james_rosen_and_the_justice_department_leak_investigation_the_fox_news_reporter.html
"Why James Rosen Is Not Blameless"

When a President divulges secrets, as with the bin Laden info and raid, they are by definition no longer classified.  It is still wrong to identify sources and methods without good reason.

The question of Rosen's good or bad judgment is separate from the apparent fact that Attorney General Eric Holder lied to congress about his own involvement investigating a journalist and his contacts.
4854  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Cognitive Dissonance of the left - Washington Post's Dana Milbank: 'Shoot first' on: June 04, 2013, 10:10:16 AM
The Washington Post is comfortable putting forward an opinion piece that leave readers with a false knowledge of the facts:

Regarding the IRS, Dana Milbank says the GOP shoots first, asks questions later.  FYI to Dana Milbank, the questions have all been asked.  The letter was written by a Democrat.  It is the ANSWERS that are lacking.  Does Milbank really not know that the questions were asked and the answers were not forthcoming?

OPINIONS  Washington Post
The ‘shoot first’ party
Dana Milbank
Here are the unanswered questions, imagine if you didn't answer their questions!
IRS Ignores Senate Deadline To Answer Questions About Scandal
IRS fails to meet Senate Finance's deadline for documents on targeting
The Internal Revenue Service missed a Friday deadline for turning over reams of documents to the Senate Finance Committee, one of several panels investigating the tax agency’s targeting of tea party groups.
4855  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Thomas Sowell: Abstract immigrants vs. a fact-based immigration discussion on: June 04, 2013, 09:53:03 AM

 A Fact-Based Immigration Discussion
We shouldn’t base immigration policy on abstract notions about abstract people.
By Thomas Sowell

One of the many sad signs of our times is the way current immigration issues are discussed. A hundred years ago, immigration controversies were discussed in the context of innumerable facts about particular immigrant groups. Many of those facts were published in a huge, multi-volume 1911 study by a commission headed by Senator William P. Dillingham.

That and other studies of the time presented hard data on such things as which groups’ children were doing well in school and which were not, which groups had high crime rates or high rates of alcoholism, and which groups were over-represented among people living on the dole.

Such data and such differences still exist today. Immigrants from some countries are seldom on welfare, but immigrants from other countries often are. Immigrants from some countries are typically people with high levels of education and skills, while immigrants from other countries seldom have much schooling or skills.

Nevertheless, many of our current discussions of immigration issues focus on immigrants in general, as if they were abstract people in an abstract world. But the concrete differences among immigrants from different countries affect whether their coming here is good or bad for the American people.

The very thought of formulating immigration laws from the standpoint of what is best for the American people seems to have been forgotten by many who focus on how to solve the problems of illegal immigrants “living in the shadows.”

A recent column in the Wall Street Journal titled “What Would Milton Friedman Say?” tried to derive what the late Professor Friedman “would no doubt regard as the ideal outcome” as far as immigration laws are concerned.

Although I was once a student of Professor Friedman, I would never presume to speak for him. However, I will point out that he was a man with the rare combination of genius and common sense, and he published much empirical work in addition to the analytical work that won him a Nobel Prize. In short, concrete facts mattered to him.

It is hard to imagine Milton Friedman looking for “the ideal outcome” on immigration in the abstract. More than once he said, “The best is the enemy of the good,” which to me meant that attempts to achieve an unattainable ideal can prevent us from reaching good outcomes that are possible in practice.

Too much of our current immigration controversy is conducted in terms of abstract ideals, such as “We are a nation of immigrants.” Of course we are a nation of immigrants. But we are also a nation of people who wear shoes. Does it follow that we should admit anybody who wears shoes?

The immigrants of today are very different in many ways from those who arrived here a hundred years ago. Moreover, the society in which they arrive is different. The Wall Street Journal column ends by quoting another economist who said, “Better to build a wall around the welfare state than the country.”

But the welfare state is already here — and, far from having a wall built around it, the welfare state is expanding in all directions by leaps and bounds. We do not have a choice between the welfare state and open borders. Anything we try to do regarding immigration laws has to be done in the context of a huge welfare state that is already a major, inescapable fact of life.

Among other facts of life utterly ignored by many advocates of de facto amnesty is that the free international movement of people is different from free international trade in goods.

Buying cars or cameras from other countries is not the same as admitting people from those countries. Unlike inanimate objects, people have cultures, and not all cultures are compatible with the culture in this country, which has produced so many benefits for the American people for so long.

Not only the United States, but the Western world in general, has been discovering the hard way that admitting people with incompatible cultures is an irreversible decision with incalculable consequences. If we do not see that after recent terrorist attacks on the streets of Boston and London, when will we see it?

“Comprehensive immigration reform” means doing everything all together in a rush, without time to look before we leap, and basing our policies on abstract notions about abstract people.
4856  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: US Economics, manufacturing index UNEXPECTEDLY declines on: June 04, 2013, 09:42:41 AM
Wesbury: "The punditry has decided that anything good happening is actually bad."...
"don't let the punditry put fear in your heart by saying the good times cannot possibly last or be true."

U.S. manufacturing index for April unexpectedly declines - hits a 4 year low

Ooops.  Now which side of punditry needs to spin?

Wesbury's rosy scenario outlook seems to only apply to the existing company indices - companies generally connected to the regulators, operating globally, that happen to still be listed on U.S. exchanges.  Startups still suck.  Employment sucks.  Tax rates are up, state and federal.  Welfare rolls are up.  Regulations are still exploding.  Inner cities are still in shambles.  Refineries are closing.   Obamacare 2014 is creating enough business uncertainty to make up for most positive forces.  Growth in Asia is fizzling.  Europe is dismantling.  I think I'll buy 100 shares...
4857  Politics, Religion, Science, Culture and Humanities / Politics & Religion / IRS Chief Wife went after Romney on Taxes on: June 03, 2013, 11:23:30 AM
The political activities of the wife bring into further question the political activities of the IRS chief during his 167 trips to the White House.  Maybe they were hammering out new depreciation schedules and not planning and executing Nixonian enemy targeting.  In that case, where are the new depreciation schedules?

Wife of Former IRS Chief Campaigned for Obama, Questioned Romney's Taxes

Former Internal Revenue Service Commissioner Douglas Shulman is under fire from Congress for his agency's targeting of Tea Party and other conservative organizations. Shulman himself is under suspicion for his numerous visits to the White House compared to other administration officials. Additionally, Shulman's wife Susan L. Anderson reportedly works for the Washington D.C. based liberal organization Public Campaign.

Anderson's group, Public Campaign, describes itself as, "a non-profit, non-partisan organization dedicated to sweeping campaign reform that aims to dramatically reduce the role of big special interest money in American politics."

(The article goes on at the link to publish many of her tweets during the campaign. "If Romney loses the election, I bet he can file an amended return and claim the deductions he didn't claim.”",  "Romney in class by himself - see @SunFoundation charts comparing Romney's tax returns to other presidents. ", "Folks go to Caymans to dodge taxes or dive reefs - wanna bet what Mitt was doing there?")

During a Congressional hearing, Rep. Paul Gosar (R-AZ) questioned Shulman if he knew how Senate Majority Leader Harry Reid (D-NV) had information in supporting a July 2012 claim that Romney had not paid taxes for the last ten years. Shulman appeared not to know how or why Senator Reid made such a claim.
4858  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Court challenges could tear down major pieces of ObamaCare on: June 03, 2013, 11:05:27 AM

Court challenges could tear down major pieces of ObamaCare

President Obama’s healthcare law is under attack in the courts even as the administration sprints toward full implementation.
Despite surviving a stiff challenge at the Supreme Court last year, some of the law’s biggest provisions remain at risk from legal challenges.  One set of lawsuits accuses the Internal Revenue Service of illegally implementing new subsidies to help people buy insurance. Separately, more than 60 lawsuits have been filed challenging the law’s mandate for health plans to cover birth control.
A loss for the administration on the contraception mandate would undermine a key selling point for the law that Democrats used to court women in the 2012 elections.
The challenge to the law’s insurance subsidies, while more obscure, poses a far bigger and more dangerous threat to the Affordable Care Act.  Simon Lazarus, senior counsel at the Constitutional Accountability Center, has argued that there’s a very real chance the Supreme Court’s conservative majority would strike down the IRS’s approach to insurance subsidies if it gets the chance.  Lazarus supports the healthcare law and believes the IRS has taken the right approach to implementing its subsidies. But it’s easy to see how the case could play out under the strict “textualist” approach championed by Justice Antonin Scalia, he said.
“One has to be concerned about that,” Lazarus said.  If the Supreme Court or judges in the lower courts adopt a narrow reading of the healthcare law, the consequences could be “devastating,” Lazarus said.  That’s exactly why the people behind the lawsuit think they have a real chance to win.
The healthcare law sets up new marketplaces where people can buy health insurance. Most people who use the marketplaces will be eligible for a subsidy to help pay for their premiums.  The law’s challengers say subsidies should only be available to people who get insurance through a state-run marketplace. If the federal government runs a state’s marketplace — which it will in the majority of states — no subsidies should be available, the lawsuit argues.  Why not? Because the text of the Affordable Care Act refers to subsidies flowing through exchanges “established by the state.”  The IRS has said subsidies will be available in all 50 states, no matter who runs the exchanges. The law’s critics say that clearly contradicts the text of the statute.
“The IRS rule we are challenging is at war with the Act’s plain language and completely rewrites the deal that Congress made with the states on running these insurance exchanges,” attorney Michael Carvin said in a statement when his clients filed their challenge to the subsidies.
The law’s supporters say the context of the entire statute makes clear that Congress intended for all 50 exchanges to function the same way.  “There are layers of reasons why this claim would and should be rejected,” Lazarus said.
But a judge or Supreme Court justice like Scalia could easily hone in on the “established by the state” language, making the case for “textualism” — adhering strictly to the specific words used in a statute, rather than trying to determine its intent.  “It’s a way of taking one isolated provision of a statute and just reading that one provision,” Lazarus said.  Lazarus has been urging the left to focus aggressively on the subsidies challenge, even though the lawsuits are still in their early stages.
Two suits have been filed challenging the subsidies; neither has gotten a hearing yet in court. There’s a chance the cases would have to wait until at least next year, for procedural reasons.  Although they don’t believe the suits stand much chance of success, some supporters of the healthcare law believe their side lost the public relations battle over the Supreme Court’s ObamaCare case, in part because liberal academics didn’t take the challenge seriously.
“However such maneuvers play out in court, the administration and its allies need to play their game out of court as well. Specifically, they need to not repeat their near-death experience with the individual mandate challenge, when they left their adversaries free to frame the legal issues, unanswered, for the media, politicians, and the public,” Lazarus wrote in a recent op-ed.
The more immediate legal threat to the Affordable Care Act comes from challenges to its birth control mandate.   
The contraception mandate is a relatively small part of the overall healthcare law, but it is a major talking point for the White House.  Obama focused extensively on the birth-control mandate during the 2012 campaign, and Democrats made the policy a cornerstone of their aggressive pitch to female voters.  An eventual Supreme Court decision on the contraception policy might not have huge implications for the rest of the healthcare law, but it would be politically explosive.
Two federal appeals courts have heard oral arguments over the contraception policy, and challengers have filed 60 lawsuits in courts across the country.  The plaintiffs, most of whom are business owners, say the policy violates their First Amendment right to religious liberty by forcing them to provide a service they find immoral.  The Obama administration has given an exemption to churches and houses of worship, and has carved out a middle ground for religious-affiliated employers like Catholic hospitals and universities.
For-profit companies are also challenging the policy. Those cases have moved faster, and though courts have been split on the issue, several have questioned whether business owners can invoke religious liberty over healthcare plans they don’t provide personally, but rather through their companies.
The 3rd Circuit Court of Appeals heard a case this week filed by a cabinet-making company whose owners object to providing contraception. The lower court in that case sided against the company, saying religious liberty belongs to people — not corporations.  "Religious belief takes shape within the minds and hearts of individuals, and its protection is one of the more uniquely 'human' rights provided by the Constitution,” the lower court said.
4859  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Scott Grannis and friends: on: June 03, 2013, 10:44:39 AM
"I share all of these concerns about the Feds ability to exit QE in a timely fashion. So what should an investor do when confronted with this risk? That is arguably a more important question than whether the fed should be reformed."  - Scott G.

An investor can be in non-dollar assets when the dollar collapses, assuming full knowledge.  I think the DOW and the other indices reflect that as people are really buying market share in these industries rather than risking investment in a a start-up company or holding anything dollar-based.  There are other defensive schemes to be sure, gold, commodities, real estate I suppose.  I own low end housing that sadly seems to be coming back into fashion in our expanding, low end economy.  But I don't want to be a rich guy in a collapsed economy.  I'd rather be an ordinary participant in a healthy economy.
4860  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: Economics - What Austerity? on: June 03, 2013, 10:27:37 AM
"Austerity" is when government spending in stagnant economies goes up 6% per year instead of 7%.

CCP/ Crafty,  Thanks for 'The Economist' austerity post.

Keynes' work spanned 4 decades and gets interpreted all kinds of ways.  The heart of what we call Keynesiansim is the idea that we need government to correct for the failures of the free market, to smooth out the business cycle so to speak.  Quite obvious today is that government is preventing the successes of formerly free markets. The issue at hand is whether austerity retards growth.  Conversely, would expanding these phony, crony stimuli be the solution to our growth deficit?  If Krugman or the other adherents have a valid point to make, I haven't seen it.

Krugman and those following him believe austerity is killing the weaker economies of Europe and will kill us next with our under-spoending (what a joke).  But where is the austerity?  (See the following article.)   The fiscal stimulus in the U.S. botched recovery has been over a trillion a year for at least 4 years.  The amount of proven improvement bought at this enormous cost is zilch.  And the generational theft it entails is obscene.  The monetary stimulus, aka quantitative expansion is also well into the multiple trillions and still continuing.  The result of the two enormous artificial forces combined is becoming history's worst recovery.  So let's do more of it! (in their view)

The cause of the current malaise is government caused distortions in the markets including taxes, regulations, uncertainty and perverse incentives.  These artificial stimuli address none of what is wrong.  We have four flat tires and the rear brakes stuck partway on while Krugman and his followers in the White House and at the Fed are trying to pouring more gas into the carburetor.  What could go wrong with that?  Pretty much everything, but the worst part is that the things that are wrong still aren't being addressed.

The general austerity argument aims first at the failing countries in Europe, the so-called PIIGS countries where austerity allegedly isn't working.  But take a closer look at what they are wrongly calling austerity:

'Austerity' To Blame? But Where's The Austerity?

Die-hard Keynesians bemoan that, with a few exceptions, the world’s economies are drowning in the quicksand of austerity. They preach we need more government spending and stimulus, not less. Northern Europe should bail out its less-fortunate neighbors to the South so they can pay their teachers, public employees and continue generous transfers to the poor and unemployed. If not, Europe’s South will remain mired in recession. In America, Keynesians entreat the skinflint Republicans to loosen the purse strings so we can escape sub par growth. They advise Japan to spend itself out of permanent stagnation and welcome recent steps in this direction.

The stimulationists complain that they have been overwhelmed by the defeatist austerity crowd, lead by the un-neighborly Germans and the obstructionist Republicans.  If only Germany would shift its economy into high gear while transferring its tax revenues to ailing Southern Europe, and the rascally Republicans drop the sequester cuts, we would be sailing along to a healthy worldwide recovery. We don’t need spending restraint. Instead, we need stimulus, stimulus, and more stimulus to revive economic growth. We’ll deal with the growing deficits later, the stimulation crowd tells us, but we must first get our economies growing again.

The Keynesian stimulus crowd blames austerity for the world’s economic woes without bothering to examine facts. I advise them first to consult my colleague at the German Institute for Economic Research (Georg Erber, I See Austerity Everywhere But in the Statistics), who, unlike them,  has actually taken the time to examine the European Union’s statistics as compiled by its statistical agency, Eurostat.

The official Keynesian story is that the PIIGS of Europe (Portugal, Italy, Ireland, Greece and Spain) have been devastated by cutbacks in public spending. Austerity has made things worse rather than better – clear proof that Keynesian stimulus is the answer. Keynesians claim the lack of stimulus (of course paid for by someone else) has spawned costly recessions which threaten to spread.  In other words, watch out Germany and Scandinavia: If you don’t pony up, you’ll be next.

Erber finds fault with this Keynesian narrative. The official figures show that PIIGS governments embarked on massive spending sprees between 2000 and 2008. During this period, their combined general government expenditures rose from 775 billion Euros to 1.3 trillion – a 75 percent increase. Ireland had the largest percentage increase (130 percent), and Italy the smallest (40 percent). These spending binges gave public sector workers generous salaries and benefits, paid for bridges to nowhere, and financed a gold-plated transfer state. What the state gave has proven hard to take away as the riots in Southern Europe show.

Then in 2008, the financial crisis hit. No one wanted to lend to the insolvent PIIGS, and, according to the Keynesian narrative, the PIIGS were forced into extreme austerity by their miserly neighbors to the north. Instead of the stimulus they desperately needed, the PIIGS economies were wrecked by austerity.

Not so according to the official European statistics. Between the onset of the crisis in 2008 and 2011,  PIIGS government spending increased by six percent from an already high plateau.  Eurostat’s projections (which make the unlikely assumption that the PIIGS will honor the fiscal discipline promised their creditors) still show the PIIGS spending more in 2014 than at the end of their spending binge in 2008.

As  Erber wryly notes: “Austerity is everywhere but in the statistics.”

The PIIGS remind me of the patient whose doctor orders him to lose weight by eating less. The patient responds by doubling his calorie intake. He later cuts back  by ten percent and wonders why he is not losing weight. The PIIGS went on a spending binge from which they do not want to retreat. They then blame their problems on austerity and the lack of charity of others.

There is another message in these figures: the insolvent PIIGS cannot finance their deficits on their own in credit markets. They can keep on spending only with loans from international organizations and the European Central Bank. That PIIGS have continued to spend unabated means that their “miserly” neighbors have continued to bail them out, largely out of public sight.

So much for the scourge of austerity in Southern Europe. The facts show it simply does not exist.

Well, never mind. The Keynesians have new reason to cheer. Japan, under the new government of Shinzo Abe,  has embarked on a program of monetary and fiscal stimulus, and, lo and behold, the stagnant Japanese economy actually recorded a whole quarter of decent growth. At last Japan has seen the light. (The latest Economist cover features a superman Abe flying to Japan’s rescue). Stimulus cheerleader, New York Times columnist Paul Krugman (Japan the Model), answers his own question  “how is Abenomics working?” with: “The safe answer is that it’s too soon to tell. But the early signs are good…”

Krugman’s memory must be incredibly short if he thinks that Japan has just discovered stimulus. Japan has been in a twenty-year-old funk, despite launching a dizzying variety of Keynesian stimulus programs, some of which bordered on the crazy (such as giving Japanese shopping vouchers so they could relearn how to spend). Over the past twenty years, Japan has tried to spend itself to growth and has nothing to show for it.

We need look only at the growth of Japan’s public debt to prove the failure of  Japan’s Keynesian experiments.  In 1990, Japan’s public debt was 67 percent of GDP (much like the U.S. today). Today it is 212 percent. All that public spending and Japan still could not grow!

At an interest rate of 5 percent, the Japanese would have to devote ten percent of GDP just to paying interest!  And Krugman wants to add to that debt. And believe me, Japan did not accumulate that debt due to austerity. It does not work that way.

Japan is an example of what Europe will look like in twenty years if it takes the Krugman advice — massive and dangerous debt with nothing to show for it.  Japan is a perfect real-world experiment with long run, sustained Keynesianism. Europe and the United States, take notice and beware!

Which leads us to the austerity that is supposedly underway in the United States.  (Remember that radical sequester that was supposed to ruin the economy?) Our figures tell exactly the same story as the PIIGS  – a binge of public spending that has not been reversed. Between 2000 and 2008, both federal and state and local spending increased by almost two thirds. Despite budget cliff hangers, sequestration, and Republican intransience (so claim the Democrats), the federal government today is spending 16 percent more than at the peak of its binge spending in 2008.  State and local governments, which cannot borrow as freely as the Feds, are spending a modest 11 percent more.

Instead of “where’s the beef?” we should ask “where’s the austerity?” Perhaps economist Krugman can find it. But first I would advise him and others like him to consult some facts before they pontificate.

PS In the comments section, I got a priceless gem from a big government fan, who relates that government spending has risen at an annual rate of 7 percent since 1965. Hence, austerity is defined as growth of government spending at a rate less than “normal.”  The 7 percent rate is instructive because, according to the rule of 72, you get a doubling every ten years. If the federal government continues to grow at its “normal” (non austerity)  rate, it will spend $32 trillion in 2043. Maybe then we’ll finally have “enough” government spending to solve all of our problems.

4861  Politics, Religion, Science, Culture and Humanities / Politics & Religion / The Fed, Monetary Policy, David Malpass: Fed Policy Is a Drag on Recovery on: May 31, 2013, 10:40:39 AM
First, two comments on the David M Gordon (DMG) post above in this thread:  a) By saying trillions of quantitative easing did not expand M2 to me is pointing out what a lousy, incomplete measurement M2 is of the money supply, hence the terms M3, M4, MZM, L, etc.    b) As I have rebutted previously, Milton Friedman said MV=PQ.  If the extra money is all parked and uncirculated as bank reserves with zero velocity, then prices don't change with output stagnant.  But what are those bank reserves other than money that presumably has the potential to be circulated and multiplied.  The final scorecard of the damage done by these policies is not yet known.  

Perhaps David Malpass was reading the discussions on the forum wink when he wrote the following piece for the WSJ today.  The Fed's manipulations create distortions in the economy and distortions keep resources from moving to their best use.  The proof is in the dismal results of these policies.

David Malpass: Fed Policy Is a Drag on Recovery
The stock market is soaring. Yet real median income has fallen 5%, unheard of for a recovery.


Former Federal Reserve Chairman Paul Volcker said in a speech to the Economic Club of New York on Wednesday that the Fed should not be asked to "accommodate misguided fiscal policies" and "will inevitably fall short." He outlined a preferred monetary policy based on orthodox central banking aimed at a stable currency in order to maximize employment. "Credibility is an enormous asset," he said. "Once earned, it must not be frittered away." Those words are true and timely.

As this month's stock and bond market gyrations showed, traders are obsessively focused on every nuance of the Fed's monetary plans. Billions of dollars are at stake for Wall Street, which profits mightily from the Fed's bond buying and cheap credit.

The problem is the broader economy's poor performance in growth and jobs. The Fed, which was once a key proponent of market-based economic policies, has forced U.S. interest rates to near zero for four-and-a-half years with no plans to stop. It has bought nearly $3 trillion in bonds, with the express goal of channeling credit to the government, government-owned enterprises and large corporations in the hope that this will boost employment.

The Fed's bond-market interventions probably helped during the 2008 crisis when markets had frozen, but after that the economy would have done much better without them. Recoveries are normally fast and broad once markets are allowed to clear and begin operating. Quarterly growth topped 9% in 1983 after a deep recession and 7% in 1996 leading into President Clinton's re-election. Interest rates were high, yet median incomes were rising sharply.

Growth in the current recovery only rose above 4% once, in the fourth quarter of 2011, and averaged just 2% per year in its first four years versus 5% in the same period of the 1980s recovery, 3.2% in the 1990s recovery and 2.9% in the 2000s recovery. The underperformance over the past four years translates into more than three million jobs that should have been created but weren't, an economic disaster that lowered real median incomes by 5%.

The disastrous state of affairs was rationalized as a "new normal" following the Great Recession, but the reality is that poor policy choices hurt growth. Tax-and-spend policies sapped investment, and the Fed's low rates and bond purchases damaged markets, hurt savers and channeled credit to the government at the expense of job creators. It's a zero-sum process that should be stopped because of the bad effect on growth and jobs.

Incredibly, as Fed Chairman Ben Bernanke alluded to in his May 22 congressional testimony, the Fed is now angling to create a semi-permanent control dial with which the Fed can increase its $85 billion in monthly bond purchases when growth slows and reduce them if growth ever speeds up. This creates maximum uncertainty for the private sector, giving an advantage to traders, the government and the rich but hurting growth and long-term investors.

Washington thrives on the impression that the economy and markets are dependent on the Federal Reserve and deficit spending. This is the wrong lesson. More likely, past government excesses—trillions added to the national debt and the Fed's liabilities—lowered the growth rate. The economy and markets would adjust and be better off without them.

One line of Fed criticism has emphasized money printing and an inflation risk. This is off target and, with inflation low, gives the Fed an opening to keep going. When the Fed buys bonds, it pays for them with liabilities to banks called excess reserves. There's no creation of new money in the private sector. The M2 money supply, the measure of bank deposits often used by monetarists to anticipate inflation, is unaffected. Private-sector credit grew only 0.8% from the end of 2008 through the end of 2012, whereas credit to the government grew 58%.

Rather than money printing that turns into cash, the excess reserves are, in effect, an IOU from the Fed. Interest is paid on them and they aren't spent or used by banks to increase lending. This distinguishes current policy from the inflationary 1960s and 1970s, when the Fed created reserves that banks used as backing for multiple loans and rapid growth in private-sector credit.

The stronger criticism is that the Fed's policy is contractionary, harming growth. The Fed's intention is that the low bond rates it provides the government will spill over to big corporations and banks, who in turn will help the little guy. This trickle-down monetary policy has contributed to very fast growth in corporate profits, part of the explanation for the record stock market, but also to weak GDP growth and declining middle-class incomes. The extra credit the Fed channeled to government and big corporations meant less credit elsewhere in the economy, a contractionary influence since most new jobs come from small businesses.

Still, three important developments may lift the economy despite the Fed, forcing it to taper its bond purchases and allow the recovery to accelerate. First, the Jan. 2 tax bill removed the risk of tax rate increases—on income, dividends, estates and the alternative minimum tax—that depressed growth in 2010-12. Second, most businesses are encouraged by the sequester and the idea of the government tackling spending, however clumsily. Third, private credit has started to grow, helped by thousands of new nonbank lenders. Total credit grew at a 5.6% annual rate in the fourth quarter of 2012 after contracting for much of 2009-12.

But whether the economy turns up or not, it should be clear that the Fed's unprecedented and far-reaching monetary policy has been a drag, not a stimulus.

Mr. Malpass, a deputy assistant Treasury secretary and legislative manager for the 1986 Tax Reform Act in the Reagan administration, is president of Encima Global LLC.

4862  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Cognitive Dissonance of His Glibness - Eric Holder on: May 31, 2013, 10:06:10 AM
Upon advice and wisdom of leadership, I move my Eric Holder post from yesterday to here.  I agree that these personal threads can detract from the issue threads.  These cabinet officials running wild are only relevant in that the unelected A.G. in this case was chosen by the President who continues to stand by him.  That said, Eric Holder is quite a piece of work, loaded with power and worthy of further study and discussion.
...Holder got his honesty and scandal handling training as Deputy A.G. for the Clintons so he is a confidant of both camps.  One might say only half-jokingly, he knows where there bodies are buried.

Here is Michael Ramirez with picture worth more than a thousand words, describing the current investigation of Holder investigating Holder.

Before Fast and Furious, Eric Holder had already made a name for himself.  "When he pushed through the pardon of Marc Rich, he didn’t know Rich had assisted America’s enemies, including Iran, or that Rich’s wife had donated large sums to Democratic and Clinton interests."

Also among Holder's work was the pardons of the FALN terrorists, and lying about legal work done for Blagojevich, famous as the convicted seller of the Obama Senate seat.

Holder has stated under oath that he didn't know about the Fox News wiretapping when it was he who signed the complaint and handling the judge shopping.

In his opening remarks for confirmation, Holder stated that law enforcement must be untainted by politics. He also insisted that the Department of Justice represents the people, not the president.

Let's judge him by his own standard.
4863  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The war on the rule of law on: May 31, 2013, 09:56:55 AM
Rick, What a great post even though it sends a chill down my spine.  Reading the Obamacare decision opened my eyes further to the process where we are giving up our liberties and expanding the powers of our central government. The Justices know the transformation is happening incrementally and instead of being alarmed by it are actually looking for ways to accelerate it.  No one joined with Justice Thomas where he simply stated that he would revisit previous commerce decisions too.  Between control of financial affairs and healthcare I don't know what is left to make us a totalitarian state.

The privacy warning is right and I don't know how to get around it.  Yesterday I had small encounters with a bank and with the healthcare system and gave nearly everything that should be private over to complete strangers in their roles as employees of the big business/big government complex.  Either person could easily steal or sell my info; they would have to be quite honest not to.  Auto insurance violates privacy the same way, storing amazing amounts of private information and requiring us to divulge it back to them with every contact.  As a landlord, I find myself on the other side of the privacy issue.  People willingly hand over their personal info while knowing almost nothing about me.  Living under the radar is nearly impossible today and most certainly illegal.

The 'Special Agent' observation is hilarious.  We are all special, aren't we?

Thanks for serving, and the respect you expressed toward the other grand jurors is encouraging.  Hope to see you here more and I hope others have followup on the many points presented.  - Special Poster Doug
4864  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Housing/Mortgage/Real Estate on: May 30, 2013, 04:11:03 PM
PP has noted the unusually high proportion of housing sales that are all cash, indicating an investor rather than a homeowner.  Who cares, right, a sale is a sale?  That is, until the investors pull out, quit buying and unload.  Rents just aren't high enough to justify big investors taking big risks on big investments.
4865  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Cognitive Diss of the left, McAuliffe: George Bush's election killed my father on: May 30, 2013, 04:06:38 PM
former Democratic National Committee head and current Virginia gubernatorial candidate Terry McAuliffe blames Bush for his dad dying. Really. In an interview in May 2001, McAuliffe said that his father, Jack, died because “he could not go into a new year knowing that a Republican was actually moving into the White House.”
4866  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Benghazi and related matters on: May 30, 2013, 04:02:29 PM
Since we don't know it was gun running, I think we can safely say it was gun running or worse, going on in Benghazi.  Something they for sure do not want us to know.

Already covered in Crafty's Blaze post but deserving of a repeat and second source, Dr. Krauthammer concludes from the evidence available that Pres. Obama who was not meeting with Generals or even trying to summon a rescue, was engaged in the concoction of the false story WHILE the fatal attacks were staying going on, which we now all know was the main concern in the administration.

Krauthammer: Obama Was Constructing A Cover Story For Benghazi While Last Two Americans Were Fighting For Their Lives

"The biggest scandal of all, the biggest question of all is what was the president doing in those eight hours. He had a routine meeting at 5:00. He never after, during the eight hours when our guys have their lives in danger, he never called the Secretary of Defense, he never calls the Chairman of the Joint Chiefs, he never called the CIA Director. Who does he call?

About five hours in he calls the Secretary of State. And after the phone call, she releases a statement essentially about the video and how we denounce any intolerance. It looks as if the only phone call was to construct a cover story at a time when the last two Americans who died were still alive and fighting for their lives. There’s the scandal and that I think has to be uncovered." (The O'Reilly Factor, May 28, 2013)
4867  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Fay Voshell: Dear IRS: Concerning the Content of my Prayers on: May 30, 2013, 03:47:28 PM
Fay was one of our contributors on a previous forum.   Link and contact info at the end.

May 26, 2013
Dear IRS: Concerning the Content of my Prayers
By Fay Voshell

Dear IRS,

I understand your people have been deeply interested in the content of my prayers.

I never thought I'd see the day.

I have always assumed prayer in any form goes against the current notion many of you in the IRS share -- the notion that absolute separation of Church and State involves suppression of any religious expression in public.

We religious types are used to being called out for praying at football games, graduations, and the like. But I hadn't thought you would be interested in the private prayers offered by me and my like-minded fellow citizens -- people who collectively wish to put their concerns before the Almighty.

Was I ever wrong!

I'm shocked you are inquiring about private thoughts before God. I assume you may also want to talk to our pastors, insisting they break their vows to keep confessions confidential?

I suppose I should not be surprised at your behavior, since a great Prophet warned there would always be people who desired to pry into all the secrets of the human heart. "Be on your guard," he said. "There is nothing concealed that will not be disclosed, or hidden that will not be made known. What you have said in the dark will be heard in the daylight, and what you have whispered in the ear in the inner rooms will be proclaimed from the roofs."

Let me be clear: My prayers are none of your business. I like to keep my thoughts between me and my God. But since you asked, I will let you know what I'm praying. I pray for my family.

I ask they will be blessed, particularly the littlest members. I ask they grow up to be pure, true, noble and brave. I ask they be preserved from predators who wish to devour their minds, bodies and souls. I ask God to place guardian angels around them to keep them from harm. I pray that when and if God calls them home to live with Him, they are escorted by angels. I pray the death of innocents and innocence will cease.

I pray for the Church.

I ask she will be free to preach the blessed gospel of Christ in all its permutations. I ask she is salt to preserve an increasingly corrupt culture. I pray for bravery for her as she faces persecution here and around the globe. I pray her priests and pastors will be emboldened to stand up for the truth.

But I am guessing you don't care much about my prayers for my family and my church. I am guessing you want to know what I am praying about the government, the nation and the world. You want to know where I stand politically, and think my prayers will give you some clues.

Very well.

Here is some of what I pray:

I pray God will recall the good deeds of America and have mercy on a nation which stood up and battled at great cost the evils of fascism and communism, taking down the Nazi scourge and felling the Iron Curtain. I ask God to remember the great good our nation has done, to take note of her generosity to nations less fortunate, to remember how many of the poor and oppressed she has absorbed into her borders. I ask him to recall her great deeds of generosity, for her attempts to ameliorate the grim conditions of those living in poverty, afflicted by disease, destroyed by famine, and ground down by oppression.

Then, knowing what evils presently afflict her, I ask God to recall her to Him. I ask she repents and is forgiven. I pray for an end to the massacre of the unborn, an end to the rise of infanticide and mercy killing. I pray for the true education of our children, and for rich opportunities for them to rise to their God-given potential. I ask for the reform of our once great academic institutions and for the triumph of thinking over ideology. I pray for our military, that it not be corrupted but that it remains honorable, strong and committed to our defense and the defense of freedom everywhere.

And, yes, I pray for our government. I ask that whatever evil is hidden within be exposed; whatever nefarious machinations are being carried out be brought to the light and expunged. I ask perpetrators of evil be punished according to the law. I ask true reform sweep throughout our national, state and city governments. I pray for just and righteous servants to be raised up as leaders. I pray for congress, our courts and our executives to be models of integrity, justice and righteousness.

I ask for honesty and impartiality to reign in our civic institutions, including the IRS.

You read that correctly. I pray for the IRS, too.

I ask that it and its employees be returned to the impartiality demanded of our civil servants. I ask that if it fails that test and continues in the paths of oppression and corruption, it collapses and is replaced with a more just system.

I ask for discernment and courage for my fellow citizens. I pray we are always on the alert. I pray we all will render to Caesar what is justly his. I ask we respect and honor in as far as possible our government and our fellow citizens. I ask we have the bravery to refuse obedience when our leaders demand we go against our God-given consciences.

Last, I pray we will not give to Caesar what he has no right to know, much less demand or control; namely, our consciences, our thoughts, our hopes and our dreams -- and our prayers.

Fay Voshell holds a M.Div. from Princeton Theological Seminary, which awarded her the Charles Hodge prize for excellence in systematic theology. She was selected as one of the Delaware GOP's "Winning Women," class of 2008. Her writing has been published in American Thinker and National Review. She may be reached at

Read more:

4868  Politics, Religion, Science, Culture and Humanities / Politics & Religion / "Core" Tax, How to junk the IRS on: May 30, 2013, 03:42:54 PM
On American Thinker today:

In a nutshell, he replaces FICA and the income tax with an expanded FICA.  Easy to calculate, easy to collect.  Remove the cap so it is taxed al the way up, levy 11% on the employee and 11% on the employer.  it would not have to be flat, could be tiered (but that creates other problems).  No deductions, exceptions or special rules (for the most part).

The plan is not fully thought through on capital gains.  I say adjust long term gains for inflation and then tax them the same.  I am not endorsing this plan (yet) but I endorse the idea that total reform is needed, simplicity and lower rates need to be at the heart of it, and that any idea ('FAIR' tax/consumption tax) that assumes the tax rate on income can ever go to zero in our lifetime is naive.

4869  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Mark Steyn: What part of your income does the IRS control? on: May 29, 2013, 04:53:24 PM
Mark Steyn on the radio, in for Rush today, made a profound point IMO.  Paraphrasing, if the tax rate is 25%, what part of your income does the IRS control?  The answer is 100%.  They control the 25% that they take of course and they control the rest too.  You have to report to them, keep accounting of it all for them and justify to them all of the part that you keep too.  He brought this point over to health care.  I will paraphrase even worse but you will have to account to them everything you do in health care, your broken leg, your prescriptions, your surgery, your decisions, coverage, payments, etc.

Here is a similar point in a Mark Steyn column:  (The guy is pretty funny.)

"A civil "civil service" requires small government. Once government is ensnared in every aspect of life, a bureaucracy grows increasingly capricious. The U.S. tax code ought to be an abomination to any free society, but the American people have become reconciled to it because of a complex web of so-called exemptions that massively empower the vast shadow state of the permanent bureaucracy. Under a simple tax system, your income is a legitimate tax issue. Under the IRS, everything is a legitimate tax issue: The books you read, the friends you recommend them to. There are no correct answers, only approved answers. Drew Ryun applied for permanent nonprofit status for a group called "Media Trackers" in July 2011. Fifteen months later, he'd heard nothing. So he applied again under the eco-friendly name of "Greenhouse Solutions," and was approved in three weeks."

"The president and the IRS commissioner are unable to name any individual who took the decision to target only conservative groups. It just kinda sorta happened, and, once it had, it growed like Topsy. But the lady who headed that office, Sarah Hall Ingram, is now in charge of the IRS office for Obamacare. Many countries around the world have introduced government health systems since 1945, but, as I wrote here last year, "only in America does 'health' 'care' 'reform' begin with the hiring of 16,500 new IRS agents tasked with determining whether your insurance policy merits a fine." So now not only are your books and Facebook posts legitimate tax issues but so is your hernia, and your prostate and your erectile dysfunction. Next time round, the IRS will be able to leak your incontinence pads to George Soros.  Big Government is erecting a panopticon state – one that sees everything, and regulates everything. It's great "customer service," except that you can never get out of the store."

4870  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Pres. Obama: America is and always will be a Racist Nation on: May 29, 2013, 10:17:51 AM
From CCP: "Doug did you read Obama's speech at Morehouse?  If one reads it one would think parts of it (at least) was written by a Herman Caine or Thomas Sowell.   I don't for the life of me understand why Blacks vote Democratic Party.  Why there own party hijacked by globalist, statist America hating liberals is giving *their* country away.  I could understand when in the past they didn't feel like a full fledged part of our society.  But now they are coming into their own.  And what do they do?  Support the party that is giving it all away.   Lets give it away to all the illegals.  Lets give it away to the EU.  Lets tax all the oil and gas companies in the US and give it to all the poor countries, lets keep spending funny money so we are so much in debt no one will have anything.   If Blacks were upset about not being a full participant in the American Dream then don't vote for a party that is destroying the American Dream. "

As is his way, he speaks out of both sides of his mouth to cover all bases, but the big applause line was that blacks have to work twice as hard [because America will always be a filthy, white, racist nation].

In fact, blacks don't have to work twice as hard:

Pres. Barack Obama never had Martin Luther king's dream that people would be judged by the content of their character instead of the color of their skin.  Obama's dream was that he could double the black unemployment rate and they would double their turnout rate for him in return, because they would need him twice as much, and he would win 12 swing states, keep the jet and all the power and the perks.  Blacks are more useful to him as victims and dependent on government.

When did Barack Obama work twice as hard as whites or anyone else?  In the Choom Gang?  At Occidental?  At Columbia?  Were his grades higher than all other to get into Harvard Law?  Did he work twice as hard to become Law Review Editor?  As Illinois State Senator?  What bills did he author as Junior U.S. Senator from Illinois?  What was his attendance record?  Did he finish his first term?  Pay his dues more than anyone ever has to become President?  What had he accomplished in January 2009 when he was awarded the Nobel Peace Prize?  What a joke.  What has he accomplished even now?  He got elected, that's it.

Out in the real world, it is the opposite.  Democrats had high hopes for this clean articulate (half) black man.  Republicans are craving that too, looking at Condoleeza Rice, Allen West, Herman Cain, Dr. Benjamin Carson, and so many others, searching for greatness, especially in a black man or woman.  Same in medicine, the business world, academics, diplomacy, grad schools, everywhere, at least that's how it is in my view.

4871  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Bachmann won’t seek reelection on: May 29, 2013, 08:49:41 AM

Bigdog, that is quite shocking.  A week ago she was running reelection ads?  I believe she was the number one fundraiser in congress.  The money gets mostly wasted because about 90% of the twin cities media market is not in her district.

Could mean a number of things.  Perhaps her ethics problem is larger than it looks or that she wants out of public service.  More likely is that she will enter a statewide race against the weak incumbent Gov. Mark Dayton or Sen. Al Franken. 

Bachmann: "I want you to be assured that is no future option or opportunity — be it directly in the political arena or otherwise that I won’t be giving serious consideration — if it can help save and protect our great nation for future generations.”

Other candidates stepping forward to run in Minnesota's most conservative district:
Matt Dean announces interest in Michele Bachmann’s seat
May 29th, 2013
Matt Dean has confirmed that he’s thinking about running for the seat left open by Michele Bachmann’s retirement.  Matt Dean is a formidable candidate. First, he’s got a good understanding of the Sixth District. He’s participated in townhall meetings throughout the District, including in St. Cloud. Second, his message is a great fit for the Sixth District. Third, Matt’s got the ability to work across the aisle without sacrificing his principles...
Third, he’s got a great understanding of two issues that are important to the Sixth District: health care and education. Fourth, he’s got a track record of being the taxpayers’ watchdog...
4872  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Pathological Science, Is Global warming statistically significant? on: May 28, 2013, 11:08:26 AM
Does the model fit the data?  Does the warming model explain the recorded data better than other models or random fluctuations?   This is a mathematical, not a measurement question or environmental question, and the answer is no.

Long, interesting story of trying to get an answer to the above question from the meteorological office of Britain (The Met Office), also posed in a WSJ editorial in 2011 linked below.  Why wouldn't scientists be excited to answer that question?

Simple example presented, let's say you flip a coin and get heads ten times in a row.  Of the competing theories as to why that happened, something about the coin leaning toward heads is a thousand time more likely model (explanation) than it being just the result of random occurrence. (Try it.) In the case of 0.8 degree warming over 150 years, randomness explains it better than the model chosen by the IPCC:

    "It is not only the Met Office that has claimed that the increase in global temperatures is statistically significant: the IPCC has as well. Moreover, the IPCC used the same statistical model as the Met Office, in its most-recent Assessment Report (2007). The Assessment Report discusses the choice of model in Volume I, Appendix 3.A. The Appendix correctly acknowledges that, concerning statistical significance, “the results depend on the statistical model used”.

    What justification does the Appendix give for choosing the trending autoregressive model? None. In other words, the model used by the IPCC is just adopted by proclamation. Science is supposed to be based on evidence and logic. The failure of the IPCC to present any evidence or logic to support its choice of model is a serious violation of basic scientific principles — indeed, it means that what the IPCC has done is not science.

    To conclude, the primary basis for global-warming alarmism is unfounded. The Met Office has been making false claims about the significance of climatic changes to Parliament—as well as to the government, the media, and others — claims which have seriously affected both policies and opinions. When questioned about those claims in Parliament, the Met Office did everything feasible to avoid telling the truth."
4873  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / To the Horror of Global Warming Alarmists, Global Cooling Is Here on: May 28, 2013, 10:41:46 AM
In order to measure man's impact or CO2's impact on temperature, one would first need to know where we were in nature's cycles, not compare with a perfectly constant global temperature which ignores or denies the cycles.

To the Horror of Global Warming Alarmists, Global Cooling Is Here

Around 1250 A.D., historical records show, ice packs began showing up farther south in the North Atlantic. Glaciers also began expanding on Greenland, soon to threaten Norse settlements on the island. From 1275 to 1300 A.D., glaciers began expanding more broadly, according to radiocarbon dating of plants killed by the glacier growth. The period known today as the Little Ice Age was just starting to poke through.

Summers began cooling in Northern Europe after 1300 A.D., negatively impacting growing seasons, as reflected in the Great Famine of 1315 to 1317. Expanding glaciers and ice cover spreading across Greenland began driving the Norse settlers out. The last, surviving, written records of the Norse Greenland settlements, which had persisted for centuries, concern a marriage in 1408 A.D. in the church of Hvalsey, today the best preserved Norse ruin.

Colder winters began regularly freezing rivers and canals in Great Britain, the Netherlands and Northern France, with both the Thames in London and the Seine in Paris frozen solid annually. The first River Thames Frost Fair was held in 1607. In 1607-1608, early European settlers in North America reported ice persisting on Lake Superior until June. In January, 1658, a Swedish army marched across the ice to invade Copenhagen. By the end of the 17th century, famines had spread from northern France, across Norway and Sweden, to Finland and Estonia.

Reflecting its global scope, evidence of the Little Ice Age appears in the Southern Hemisphere as well. Sediment cores from Lake Malawi in southern Africa show colder weather from 1570 to 1820. A 3,000 year temperature reconstruction based on varying rates of stalagmite growth in a cave in South Africa also indicates a colder period from 1500 to 1800. A 1997 study comparing West Antarctic ice cores with the results of the Greenland Ice Sheet Project Two (GISP2) indicate a global Little Ice Age affecting the two ice sheets in tandem.

The Siple Dome, an ice dome roughly 100 km long and 100 km wide, about 100 km east of the Siple Coast of Antartica, also reflects effects of the Little Ice Age synchronously with the GISP2 record, as do sediment cores from the Bransfield Basin of the Antarctic Peninsula. Oxygen/isotope analysis from the Pacific Islands indicates a 1.5 degree Celsius temperature decline between 1270 and 1475 A.D.

The Franz Josef glacier on the west side of the Southern Alps of New Zealand advanced sharply during the period of the Little Ice Age, actually invading a rain forest at its maximum extent in the early 1700s. The Mueller glacier on the east side of New Zealand’s Southern Alps expanded to its maximum extent at roughly the same time.

Ice cores from the Andeas mountains in South America show a colder period from 1600 to 1800. Tree ring data from Patagonia in South America show cold periods from 1270 to 1380 and from 1520 to 1670. Spanish explorers noted the expansion of the San Rafael Glacier in Chile from 1675 to 1766, which continued into the 19th century.

The height of the Little Ice Age is generally dated as 1650 to 1850 A.D. The American Revolutionary Army under General George Washington shivered at Valley Forge in the winter of 1777-78, and New York harbor was frozen in the winter of 1780. Historic snowstorms struck Lisbon, Portugal in 1665, 1744 and 1886. Glaciers in Glacier National Park in Montana advanced until the late 18th or early 19th centuries. The last River Thames Frost Fair was held in 1814. The Little Ice Age phased out during the middle to late 19th century.

The Little Ice Age, following the historically warm temperatures of the Medieval Warm Period, which lasted from about AD 950 to 1250, has been attributed to natural cycles in solar activity, particularly sunspots. A period of sharply lower sunspot activity known as the Wolf Minimum began in 1280 and persisted for 70 years until 1350. That was followed by a period of even lower sunspot activity that lasted 90 years from 1460 to 1550 known as the Sporer Minimum. During the period 1645 to 1715, the low point of the Little Ice Age, the number of sunspots declined to zero for the entire time. This is known as the Maunder Minimum, named after English astronomer Walter Maunder. That was followed by the Dalton Minimum from 1790 to 1830, another period of well below normal sunspot activity.

The increase in global temperatures since the late 19th century just reflects the end of the Little Ice Age. The global temperature trends since then have followed not rising CO2 trends but the ocean temperature cycles of the Pacific Decadal Oscillation (PDO) and the Atlantic Multidecadal Oscillation (AMO). Every 20 to 30 years, the much colder water near the bottom of the oceans cycles up to the top, where it has a slight cooling effect on global temperatures until the sun warms that water. That warmed water then contributes to slightly warmer global temperatures, until the next churning cycle.

Those ocean temperature cycles, and the continued recovery from the Little Ice Age, are primarily why global temperatures rose from 1915 until 1945, when CO2 emissions were much lower than in recent years. The change to a cold ocean temperature cycle, primarily the PDO, is the main reason that global temperatures declined from 1945 until the late 1970s, despite the soaring CO2 emissions during that time from the postwar industrialization spreading across the globe.

The 20 to 30 year ocean temperature cycles turned back to warm from the late 1970s until the late 1990s, which is the primary reason that global temperatures warmed during this period. But that warming ended 15 years ago, and global temperatures have stopped increasing since then, if not actually cooled, even though global CO2 emissions have soared over this period. As The Economist magazine reported in March, “The world added roughly 100 billion tonnes of carbon to the atmosphere between 2000 and 2010. That is about a quarter of all the CO2 put there by humanity since 1750.” Yet, still no warming during that time. That is because the CO2 greenhouse effect is weak and marginal compared to natural causes of global temperature changes.

At first the current stall out of global warming was due to the ocean cycles turning back to cold. But something much more ominous has developed over this period. Sunspots run in 11 year short term cycles, with longer cyclical trends of 90 and even 200 years. The number of sunspots declined substantially in the last 11 year cycle, after flattening out over the previous 20 years. But in the current cycle, sunspot activity has collapsed. NASA’s Science News report for January 8, 2013 states,

“Indeed, the sun could be on the threshold of a mini-Maunder event right now. Ongoing Solar Cycle 24 [the current short term 11 year cycle] is the weakest in more than 50 years. Moreover, there is (controversial) evidence of a long-term weakening trend in the magnetic field strength of sunspots. Matt Penn and William Livingston of the National Solar Observatory predict that by the time Solar Cycle 25 arrives, magnetic fields on the sun will be so weak that few if any sunspots will be formed. Independent lines of research involving helioseismology and surface polar fields tend to support their conclusion.”

That is even more significant because NASA’s climate science has been controlled for years by global warming hysteric James Hansen, who recently announced his retirement.

But this same concern is increasingly being echoed worldwide. The Voice of Russia reported on April 22, 2013,

“Global warming which has been the subject of so many discussions in recent years, may give way to global cooling. According to scientists from the Pulkovo Observatory in St.Petersburg, solar activity is waning, so the average yearly temperature will begin to decline as well. Scientists from Britain and the US chime in saying that forecasts for global cooling are far from groundless.”

That report quoted Yuri Nagovitsyn of the Pulkovo Observatory saying, “Evidently, solar activity is on the decrease. The 11-year cycle doesn’t bring about considerable climate change – only 1-2%. The impact of the 200-year cycle is greater – up to 50%. In this respect, we could be in for a cooling period that lasts 200-250 years.” In other words, another Little Ice Age.

The German Herald reported on March 31, 2013,

“German meteorologists say that the start of 2013 is now the coldest in 208 years – and now German media has quoted Russian scientist Dr Habibullo Abdussamatov from the St. Petersburg Pulkovo Astronomical Observatory [saying this] is proof as he said earlier that we are heading for a “Mini Ice Age.” Talking to German media the scientist who first made his prediction in 2005 said that after studying sunspots and their relationship with climate change on Earth, we are now on an ‘unavoidable advance towards a deep temperature drop.’”

Faith in Global Warming is collapsing in formerly staunch Europe following increasingly severe winters which have now started continuing into spring. Christopher Booker explained in The Sunday Telegraph on April 27, 2013,
The Disgraceful Episode Of Lysenkoism Brings Us Global Warming Theory Peter Ferrara Peter Ferrara Contributor
As The Economy Recesses, Obama's Global Warming Delusions Are Truly Cruel Peter Ferrara Peter Ferrara Contributor
Sorry Global Warming Alarmists, The Earth Is Cooling Peter Ferrara Peter Ferrara Contributor
Salvaging The Mythology Of Man-Caused Global Warming Peter Ferrara Peter Ferrara Contributor

“Here in Britain, where we had our fifth freezing winter in a row, the Central England Temperature record – according to an expert analysis on the US science blog Watts Up With That – shows that in this century, average winter temperatures have dropped by 1.45C, more than twice as much as their rise between 1850 and 1999, and twice as much as the entire net rise in global temperatures recorded in the 20th century.”

A news report from India (The Hindu April 22, 2013) stated, “March in Russia saw the harshest frosts in 50 years, with temperatures dropping to –25° Celsius in central parts of the country and –45° in the north. It was the coldest spring month in Moscow in half a century….Weathermen say spring is a full month behind schedule in Russia.” The news report summarized,

“Russia is famous for its biting frosts but this year, abnormally icy weather also hit much of Europe, the United States, China and India. Record snowfalls brought Kiev, capital of Ukraine, to a standstill for several days in late March, closed roads across many parts of Britain, buried thousands of sheep beneath six-metre deep snowdrifts in Northern Ireland, and left more than 1,000,000 homes without electricity in Poland. British authorities said March was the second coldest in its records dating back to 1910. China experienced the severest winter weather in 30 years and New Delhi in January recorded the lowest temperature in 44 years.”

Booker adds, “Last week it was reported that 3,318 places in the USA had recorded their lowest temperatures for this time of year since records began. Similar record cold was experienced by places in every province of Canada. So cold has the Russian winter been that Moscow had its deepest snowfall in 134 years of observations.”

Britain’s Met Office, an international cheerleading headquarters for global warming hysteria, did concede last December that there would be no further warming at least through 2017, which would make 20 years with no global warming. That reflects grudging recognition of the newly developing trends. But that reflects as well growing divergence between the reality of real world temperatures and the projections of the climate models at the foundation of the global warming alarmism of the UN’s Intergovernmental Panel on Climate Change (IPCC). Since those models have never been validated, they are not science at this point, but just made up fantasies. That is why, “In the 12 years to 2011, 11 out of 12 [global temperature]forecasts [of the Met Office] were too high — and… none were colder than [resulted],” as BBC climate correspondent Paul Hudson wrote in January.

Global warming was never going to be the problem that the Lysenkoists who have brought down western science made it out to be. Human emissions of CO2 are only 4 to 5% of total global emissions, counting natural causes. Much was made of the total atmospheric concentration of CO2 exceeding 400 parts per million. But if you asked the daffy NBC correspondent who hysterically reported on that what portion of the atmosphere 400 parts per million is, she transparently wouldn’t be able to tell you. One percent of the atmosphere would be 10,000 parts per million. The atmospheric concentrations of CO2 deep in the geologic past were much, much greater than today, yet life survived, and we have no record of any of the catastrophes the hysterics have claimed. Maybe that is because the temperature impact of increased concentrations of CO2 declines logarithmically. That means there is a natural limit to how much increased CO2 can effectively warm the planet, which would be well before any of the supposed climate catastrophes the warming hysterics have tried to use to shut down capitalist prosperity.

Yet, just last week, there was Washington Post columnist Eugene Robinson telling us, by way of attempting to tutor Rep. Lamar Smith (R-TX), Chairman of the House Committee on Science, Space and Technology, “For the record, and for the umpteenth time, there is no ‘great amount of uncertainty’ about whether the planet is warming and why.” If you can read, and you have gotten this far in my column, you know why Robinson’s ignorance is just another Washington Post abuse of the First Amendment. Mr. Robinson, let me introduce you to the British Met Office, stalwart of Global Warming “science,” such as it is, which has already publicly confessed that we are already three quarters through 20 years of No Global Warming!

Booker could have been writing about Robinson when he concluded his Sunday Telegraph commentary by writing, “Has there ever in history been such an almighty disconnect between observable reality and the delusions of a political class that is quite impervious to any rational discussion?”

But there is a fundamental problem with the temperature records from this contentious period, when climate science crashed into political science. The land based records, which have been under the control of global warming alarmists at the British Met Office and the Hadley Centre Climate Research Unit, and at NASA’s Goddard Institute for Space Studies and the National Oceanic and Atmospheric Administration (NOAA) in the U.S., show much more warming during this period than the incorruptible satellite atmosphere temperature records. Those satellite records have been further confirmed by atmospheric weather balloons. But the land based records can be subject to tampering and falsification.
4874  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Sowell: Bullying on: May 28, 2013, 10:24:46 AM
A company that pays $16 million a day in taxes isn't doing enough, causing children to starve etc.  Good grief.  Thomas Sowell is a person who puts my thoughts to words better than I could ever hope to.  In this case it is Carl Levin making the Obama-style, Dem-fascism case.  We need to defeat their way of thinking, not just bring down individuals in scandals and elections.

Thomas Sowell
The Bullying Pulpit

We have truly entered the world of "Alice in Wonderland" when the CEO of a company that pays $16 million a day in taxes is hauled up before a Congressional subcommittee to be denounced on nationwide television for not paying more.

Apple CEO Tim Cook was denounced for contributing to "a worrisome federal deficit," according to Senator Carl Levin — one of the big-spending liberals in Congress who has had a lot more to do with creating that deficit than any private citizen has.

Because of "gimmicks" used by businesses to reduce their taxes, Senator Levin said, "children across the country won't get early education from Head Start. Needy seniors will go without meals. Fighter jets sit idle on tarmacs because our military lacks the funding to keep pilots trained."

The federal government already has ample powers to punish people who have broken the tax laws. It does not need additional powers to bully people who haven't.

What is a tax "loophole"? It is a provision in the law that allows an individual or an organization to pay less taxes than they would be required to pay otherwise. Since Congress puts these provisions in the law, it is a little much when members of Congress denounce people who use those provisions to reduce their taxes.

If such provisions are bad, then members of Congress should blame themselves and repeal the provisions. Yet words like "gimmicks" and "loopholes" suggest that people are doing something wrong when they don't pay any more taxes than the law requires.

Are people who are buying a home, who deduct the interest they pay on their mortgages when filing their tax returns, using a "gimmick" or a "loophole"? Or are only other people's deductions to be depicted as somehow wrong, while our own are OK?

Supreme Court Justice Oliver Wendell Holmes pointed out long ago that "the very meaning of a line in the law is that you intentionally may go as close to it as you can if you do not pass it."

If the line in tax laws was drawn in the wrong place, Congress can always draw it somewhere else. But, if you buy the argument used by people like Senator Levin, then a state trooper can pull you over on a highway for driving 64 miles per hour in a 65 mile per hour zone, because you are driving too close to the line.

The real danger to us all is when government not only exercises the powers that we have voted to give it, but exercises additional powers that we have never voted to give it. That is when "public servants" become public masters. That is when government itself has stepped over the line.

Government's power to bully people who have broken no law is dangerous to all of us. When Attorney General Eric Holder's Justice Department started keeping track of phone calls going to Fox News Channel reporter James Rosen (and his parents) that was firing a shot across the bow of Fox News — and of any other reporters or networks that dared to criticize the Obama administration.

When the Internal Revenue Service started demanding to know who was donating to conservative organizations that had applied for tax-exempt status, what purpose could that have other than to intimidate people who might otherwise donate to organizations that oppose this administration's political agenda?

The government's power to bully has been used to extract billions of dollars from banks, based on threats to file lawsuits that would automatically cause regulatory agencies to suspend banks' rights to make various ordinary business decisions, until such indefinite time as those lawsuits end. Shakedown artists inside and outside of government have played this lucrative game.

Someone once said, "any government that is powerful enough to protect citizens against predators is also powerful enough to become a predator itself." And dictatorial in the process.

No American government can take away all our freedoms at one time. But a slow and steady erosion of freedom can accomplish the same thing on the installment plan. We have already gone too far down that road. F.A. Hayek called it "the road to serfdom."

How far we continue down that road depends on whether we keep our eye on the ball — freedom — or allow ourselves to be distracted by predatory demagogues like Senator Carl Levin.
4875  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: China, Asian economy on: May 28, 2013, 10:04:34 AM
"China facing a bubble?  Who knew?"
Ummm , , , as posted here for a few years now, I did  grin though not for the reasons here based upon Keynesian drivel , , ,

Yes, I agree on the first part.  On the second point I'm not sure if I follow you.  When QE ends, some of the artificial effects of it end with it, with consequences.  I am all for QE ending, just saying what seems to be widely ignored, it won't be pretty if and when it happens.  This was one of 3 posts on 3 separate threads but taken together, if they each have validity, the slightly negative economic news coming out of India, Korea and China, (and Japan and elsewhere) poses risks for global companies and investors everywhere.

Will their bubble pop before ours does? They have a few advantages over us, such as a leadership that knows that marxism doesn't work.....

Good point.  My point is not which goes first but of the interconnectedness.  Either burst would have a major, adverse effect on the other.  To take one local Dow listed example, how does 3M's sales performance and outlook look without rapidly growing Asia sales and operations?  Not nearly as good as it does now.
4876  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Government programs, Culturally based Smoking Cessation on: May 27, 2013, 10:34:15 AM
Yes, strange that none of the savings on Benghazi security found its way into Interstate bridge maintenance.  Where else did the money go?  Who else besides me was worried about funding smoking cessation studies for government funded sex change recipients?  No worries, those programs were fully funded.  The bridge can wait.

Taxpayers Spend $536,526 to Study Smoking Cessation for LGBT Community
By Fred Lucas  May 23, 2013

( – The National Institutes of Health issued a $536,526 grant to the University of Illinois, Chicago, for a two-year program ending in July to study the smoking cessation of lesbian, gay, bisexual and transgender population.

“The purpose of this study is to develop and evaluate the benefits of culturally targeted smoking cessation intervention for lesbian, gay, bisexual and transgender smokers,” the NIH grant description said. “Findings will contribute to the scientific literature on reducing smoking-related health disparities among underserved populations.”

The funding began on Sept. 30, 2010 and will conclude on July 31, 2013.
4877  Politics, Religion, Science, Culture and Humanities / Politics & Religion / China Daily: China must be prepared for capital exit on: May 27, 2013, 10:26:58 AM
China facing a bubble?  Who knew?

China must be prepared for capital exit
By Hong Liang  China Daily

At the G20 meeting in Washington last month, the International Monetary Fund sounded a warning about the problems that could be caused by a sudden massive outflow of capital from emerging markets when the major developed economies, notably the United States, terminate their quantitative easing programs.

Since the US Federal Reserve started its quantitative easing program some two years ago, there has been a large flow of capital into emerging markets in search of higher returns. This flood of money has, in turn, inflated asset prices in these markets and pushed up the value of their respective currencies.

These aggressive monetary policies adopted by some developed economies to stimulate their economic growth cannot be sustained for too long as they can create their own problems with too much cheap money floating around. It's widely expected that governments will stop printing money as soon as their economies show definite signs of a sustainable recovery.

That may come sooner than expected, and a more optimistic economic outlook in developed countries could trigger a reversal in capital flows out of emerging markets. A sudden capital outflow could burst the asset bubbles in some emerging markets, sparking a financial crisis as many enterprises have greatly increased their foreign currency borrowings at low interest rates to fund their domestic investments.

Acknowledging the "crucial" role of "accommodative monetary policy" in stimulating economic growth, the IMF cautioned in a statement issued at the conference that there is a need to monitor the potential impacts of monetary easing on capital flows and exchange rates. "Eventual exit from monetary expansion will need to be carefully managed and clearly communicated," the statement said.

At the conference, IMF Managing Director Christine Lagarde warned that "unconventional" monetary policy has raised international concern about currency valuations and competitive depreciation. She added that the IMF will probe further into the consequences of unconventional monetary policy and "what will be the consequences of the variety of exit and what will be good exits as opposed to the more unpleasant exits" for all IMF member countries.

At that time, the US economy was still mired in a sputtering recovery hamstrung by persistently high unemployment and tepid consumer demand. In Japan, the monetary easing program, though large in scale, was too new to have produced any results, although some neighboring economies were already seeing a marked increase in the influx of capital. Under these circumstances, the IMF warnings about exit policy seemed premature and economic planners in most countries didn't take them seriously.

Not anymore. The marked improvement in the US' employment figures has raised expectations that the Fed will consider moderating the pace of its monthly bond purchases. The Fed is schedule to debate policy on June 18 and 19.

With a balance sheet swollen to some $3.3 trillion, the Fed must weigh the risks of igniting future inflation or blowing up asset bubbles against printing more money to pump up the economy. Fed Chairman Ben Bernanke and other Fed officials have said that any reduction in bond purchases would not indicate a withdrawal of monetary stimulus. But to many emerging market observers, preparation by the Fed for an exit is on the way.

In a recent speech, the text of which was published last week, Liu Yuhui, a financial researcher at the Chinese Academy of Social Sciences, said that the normalization of US monetary policy is expected to rapidly gather pace, causing a severe contraction in the international flow of the US dollar, which would, in turn, exert tremendous pressure on asset markets across the Asia-Pacific region.

Liu said that Chinese banks need to strengthen their financial structures to face the threats coming from abroad, warning that assets, mainly properties, were already valued at levels considered too high.
4878  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: North and South Korea on: May 27, 2013, 10:23:15 AM
English version of Korean economic reporting

Why Korea's Middle Class Is Collapsing

Global consulting firm McKinsey said in a report on Sunday that half of all middle-class Korean households risk falling into poverty as they are trapped by slow income growth and increased expenditures.

The proportion of middle-class households shrank from 75.4 percent in 1990 to 67.5 percent in 2010, and 55 percent of middle-class families are having a tough time making ends meet as they are burdened by debt, according to McKinsey.

The biggest reason for the decline of the middle class is a drop in the number of high-paying jobs with major business conglomerates, which led to a standstill in income growth. Productivity of major manufacturers increased 9.3 percent on average annually from 1995 to 2010, but their overseas production also rose from 6.7 percent in 2005 to 16.7 percent in 2010, resulting in an average 2 percent fall a year in domestic hiring.

Small- and mid-sized businesses, which account for 88 percent of domestic jobs, and the service sector, which accounts for 70 percent, are suffering from low productivity.

Productivity in SMEs plummeted from 49 percent of the level of major conglomerates in 1990 to 27 percent in 2010, while pay stands at half the amount of the conglomerates. In Germany, SMEs’ productivity stands at 62 percent of the level of big businesses, and salaries at 90 percent. In the service sector, productivity reaches 40 percent of the level of big companies.

But while incomes stagnate, the mortgage repayment burden is mounting, as is education spending for children. As a result, the household savings rate fell from 20 percent in 1994 to just 3 percent in 2012, the lowest in the OECD, while household debt surged.

The consulting firm pointed out that Korea has the world’s highest suicide rate and is seeing a surge in divorces and a low birthrate, all of which also contribute to the decline of the middle class. At this rate, the Korean economy would be "unable to continue growth," it added.

If the Korea is to obtain a new growth engines, it must boost the competitiveness and efficiency of small businesses and the service sector. This solution is nothing new, but no concrete measures have been put into practice so far.

In order for the economy to gain momentum again and to create high-quality jobs, businesses wallowing in low productivity must be left to fail according to the principles of the free market and their workers must shift to new and efficient industries. That is the only way to improve productivity across the board, restore the middle class and enhance the quality of life.
4879  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: India; Indian growth model unsustainable at best (?) on: May 27, 2013, 10:19:18 AM
An opinion from a New Delhi economist published in the Asia Times FWIW...
Indian growth model unsustainable at best
By Kunal Kumar Kundu

NEW DELHI- The Indian economy is likely to have grown at a mere 5% in the financial year that ended in March, the lowest growth rate in a decade; investments are falling and the fault lines of Indian politics lie fully exposed.

With the government embroiled in a numerous corruption cases, leading to a sense of policy paralysis gripping the economy, business confidence has been on the wane.

India's shinning story of a decade back has lost plenty of sheen of late due to growing frustration at a rising governance deficit. The

very fact that the Indian economy is expected to grow at close to 6% during the current financial year and close to 7% in the next (a far cry from 8% to 9% growth predicted a few years back) indicates how short-term expectations have been whittled down.

However, like China, India is still considered to be one of the world's rising economic powers. But, while the Chinese growth story has the authoritarian state to thank for it, the forward march of the Indian economy has been impeded by the ineptitude of the state.

After growing at over a double-digit rate for decades, China is now on the throes of a slowdown caused by over investment and under consumption, though its state-of-the-art infrastructure can be cause for envy. India, on the other hand, suffers from woefully inadequate infrastructure as the financially challenged government cannot invest while the morally and politically challenged government fails to clear away hurdles against private investment.

Even so, there's a generally held view that by 2030, India (a supposed growth engine for the global economy) will be the world's third-largest economy while it could overtake China as the world's fastest growing major economy much sooner.

The question, therefore, is how can one of the most populous countries like India grow at a pace it has grown despite widespread corruption, inefficiency and a government that can barely be called functional?

A peek into India's growth history can, to a large extent, explain this dichotomy. Essentially, it boils down to the extent of control that the government has on the various sectors of the economy.

India leapfrogged from being an agrarian economy to a service sector led economy as entrepreneurs had to find a way to grow despite the heavy hand of government. The agriculture sector, which is under maximum government control, now accounts for a mere 14% of gross domestic product (GDP). Industry, where the government still has major control on the factors of production such as land, labor and natural resources, accounts for roughly 26% of GDP. On the other hand, the service sector, about which the government has limited knowledge and over which it has the least control, now accounts for roughly 60% of GDP.

To understand how India's entrepreneurial spirit thrives and grows despite clear governance failure, one need look no further than the cities of Gurgaon, in northwestern Haryana state, and Bangalore, to the south in Karnataka.

Gurgaon, as we know it, is barely two decades old yet houses practically every big name in the corporate world. Its buildings are designed by the world's best architects, and it has about 24 shopping malls that stock practically every international brand, eight golf courses and more than 20 outlets for luxury cars such as BMW, Audi and Volkswagen.

However, while it's a private sector success story, it is a public sector failure. The city does not have a functioning drainage system; reliable electricity or water; or any citywide system of public transportation.

The inadequacies of the government did not act as a deterrent for the private sector. To compensate for several hours of electricity blackouts, companies and real estate developers operate massive diesel generators that have the capacity to provide electricity to small towns. Private water supply flourishes as do privately dug bore wells to take care of shortages. Large number of companies employs hundreds of private buses and taxis to bridge the transportation gap.

The experience of India's IT capital Bangalore is not dissimilar. Companies such as Infosys and Wipro maintain their own fleet of vehicles to transport their employees and have huge captive power generation capacity to ensure uninterrupted service.

Gurgaon and Bangalore are good examples of how the private sector strives to keep the economy functional despite the huge governance deficit, raising the question of whether this should be the template for future economic growth?

Ideally not, since the existing growth template is not efficient enough. It can provide temporary succor but not a permanent solution. The animal spirit that was unleashed following the ushering in of economic reforms in 1991 has, by now, taken advantage of all the low hanging fruits that could be plucked.

A functional private sector and a dysfunctional public sector is the least desired recipe for sustainable growth. Fact is, only a small portion of the blame for recently plummeting growth can be directed toward external factors. The debilitating impact of the governance deficit has manifested itself in a far bigger way than anticipated.

Rising inequality, continued health and education challenges, and a tussle for ownership of factors of production are challenges that need to be addressed by well-intentioned government and the private sector.

The Indian economy cannot be service-sector driven for an indefinite period. Manufacturing has to play an equally important role to ensure a more equitable growth. For that to happen India desperately needs a government that can function and be effective. Only a concerted effort to follow this strategy can help the economy get back to the growth path that logically should be India's.

Kunal Kumar Kundu is a New Delhi-based economist.
4880  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Government programs on: May 27, 2013, 09:33:53 AM
Happy Memorial Day everyone.

Now back to coverage of our bloated and badly run government.  How is it that in $7 trillion in new debt and going on $30 trillion in Obama spending none of it found its way into repairing or rebuilding the third(?)(4th?)(5th?) federal interstate bridge to fall?  We were just too focused on the important stuff, like paying people not to work.
4881  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / The First Amendment: Taranto v. Rawitch, 'offensive' cartoon censorship on: May 26, 2013, 11:46:27 AM
One of my favorite opinion journalists, James Taranto, editor of the WSJ online editorial page, published his own college story about his not-politically-correct decision to re-publish a UCLA cartoon mocking affirmative action in his own college newspaper.  The issue, as I read it, was whether students writing a college newspaper have first amendment rights.  At the end he won his $93 back in settlement and declined to take a degree from his anti-mentors.

Long piece, a very readable story, except that Taranto has a goofy trademark of writing about himself in first person plural.
This was the 1987 cartoon that set off huge controversies:
4882  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Pathological Science: Who Are the Real Climate Deniers? on: May 26, 2013, 10:22:06 AM
David Solway writing at PJ Media about a talk in Ottawa by Tom Harris, director of the International Climate Science Coalition

...the science is far from settled and that if we were honest with ourselves and wished to approach the subject with scientific rigor and impartiality, we would have to modestly agree, in his own words, that “the more we learn, the more we realize that we just do not know.

Uncertainty, however, is not synonymous with confusion or ignorance. We do not know everything or even enough, but we still know a fair amount about climate realities, as Harris’s discourse made clear.  We know the long history of climatological variations, the many different factors that impinge upon and largely account for vast fluctuations in weather over the centuries and millennia, and the response of the scientific community, often, it must be said, disingenuous and repressive, to the data at its disposal.

We know, via proxies like ice core samples, fossil remains, marine specimens, temperature-dependent remanence measurements, as well as historical documents, etc., that there were periods in history when the earth was significantly warmer than it is today, though human beings were not pumping CO2 into the atmosphere — CO2 levels during the Ordovician Age 440 million years ago were ten times higher than they are at present and happened to coincide with an ice age; closer to home, during the Medieval Warm Period the Scandinavians farmed Greenland and in the Roman Warm Period olive groves flourished in Germany. We know that the Northwest Passage was open during the early part of the 20th century and that the Norwegian explorer Roald Amundsen, as recounted in his The North West Passage, navigated the strait between 1903 and 1906. (Its “gates” have been “forced…ajar,” he writes, and “traced from end to end by one ship’s keel” — his own.)

We know that solar activity is a primary driver of climate change. We know that temperatures have stabilized since 1998 and may possibly have declined by a fraction of a degree, and that we are currently in what is defined as an “interglacial” — and in fact, temperatures recorded at the American base at the south pole show it to be colder today than when the base was established over 50 years ago.
We know, too, that Michael Mann’s celebrated “hockey stick” graphs depicting an abrupt spike in temperatures in the recent era are fraudulent and are in process of being retired; that computer models are notoriously unreliable and are unable even to retrodict the past; that temperature reading stations are both too few and egregiously misplaced, often in urban areas and near man-made structures that capture or produce heat, thus recording misleading data; and that the media contention that the majority of the world’s scientists are firm adherents of the AGW (anthropogenic global warming) thesis is simply false.

... more than 31,000 scientists who added their signatures to the Oregon Institute of Science and Medicine “petition project” in 2008, repudiating the 600 or so scientists who have signed on to the UN’s Intergovernmental Panel on Climate Change (IPCC) warming consensus. Further, it seems, as the petition states, “that increases in atmospheric carbon dioxide produce many beneficial effects upon the natural plant and animal environments of the Earth,” a subject Harris also touched on but one studiously avoided by the warmists.   
We know that assessments counter to the prevailing orthodoxy have been deliberately suppressed and that the evidence for AGW was often just made up — witness the infamous “hide the decline” email dumps emanating from the mysteriously hacked Hadley Climatic Research Unit at the University of East Anglia, which have disclosed the duplicitous and counterfeit nature of its methods and procedures. The lead researcher at the East Anglia CRU, Phil Jones, has gone so far as to recommend deleting all incriminating emails and/or changing the wording of others. As I wrote in Global Warning: The Trials of an Unsettled Science, “What we are seeing is the unfolding of a Climategate scandal that, one hopes, will put paid to a vast and tenacious hoax.” The climate mavens will stoop to practically anything to defend their ideological patrimony.
(more at link)
4883  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Articulating our cause/strategy against Islamic Fascism on: May 26, 2013, 09:23:04 AM
Six of the ten current headlines (Huffington Post May 25 2013) relate one way or another to terrorism or the problem of Islamic jihad.  One of them sticks out like the proverbial sore thumb.  - Steven Hayward, Powerline

Soldier stabbed
London attack
Suicide bomber
Sectarian violence
Beheaded soldier
Obama sees terror threat reduced
4884  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: US Economics, the stock market , and other investment/savings strategies on: May 25, 2013, 07:00:15 PM
We lost 12% of our economy per year to the failure of the policies still in place.  Instead of making up for lost ground we have been growing at half the rate that we should have been for 4 years, digging that hole deeper.  In 6 years since Pelosi-Reid-Obama policies became the direction of the country and the law of the land that makes a total loss of economic activity of approximately 50 trillion dollars over 6 years.  Real unemployment, black unemployment, number of people in need of food assistance, etc., all doubled.  We can spin that failure any way we want.

Washington (CNN) - Two-thirds of Americans say that the nation's economy is in poor shape

The market for crony companies operating globally in a Fed tampered environment went up enormously and we missed it.  Like the lottery and a Kentucky Derby longshot, I could not place that bet. The losers were the small operators, startups that never started, a generation of new grads, and the millions who left the workforce unwillingly.  

The other negative is that of the 50% who will pay in, every family of four just added the debt of a median house without getting the house.
4885  Politics, Religion, Science, Culture and Humanities / Politics & Religion / China: Bret Stephens, WSJ, Yang Jisheng - Reading Hayek in Beijing on: May 25, 2013, 04:49:01 PM
Current Pulitzer Prize winner WSJ/Brret Stephens:
Reading Hayek in Beijing       May 24, 2013
A chronicler of Mao's depredations finds much to worry about in modern China.


In the spring of 1959, Yang Jisheng, then an 18-year-old scholarship student at a boarding school in China's Hubei Province, got an unexpected visit from a childhood friend. "Your father is starving to death!" the friend told him. "Hurry back, and take some rice if you can."

Granted leave from his school, Mr. Yang rushed to his family farm. "The elm tree in front of our house had been reduced to a barkless trunk," he recalled, "and even its roots had been dug up." Entering his home, he found his father "half-reclined on his bed, his eyes sunken and lifeless, his face gaunt, the skin creased and flaccid . . . I was shocked with the realization that the term skin and bones referred to something so horrible and cruel."

Mr. Yang's father would die within three days. Yet it would take years before Mr. Yang learned that what happened to his father was not an isolated incident. He was one of the 36 million Chinese who succumbed to famine between 1958 and 1962.

It would take years more for him to realize that the source of all the suffering was not nature: There were no major droughts or floods in China in the famine years. Rather, the cause was man, and one man in particular: Mao Zedong, the Great Helmsman, whose visage still stares down on Beijing's Tiananmen Square from atop the gates of the Forbidden City.

Enlarge Image
Zina Saunders

Yang Jisheng

Mr. Yang went on to make his career, first as a journalist and senior editor with the Xinhua News Agency, then as a historian whose unflinching scholarship has brought him into increasing conflict with the Communist Party—of which he nonetheless remains a member. Now 72 and a resident of Beijing, he's in New York this month to receive the Manhattan Institute's Hayek Prize for "Tombstone," his painstakingly researched, definitive history of the famine. On a visit to the Journal's headquarters, his affinity for the prize's namesake becomes clear.

"This book had a huge impact on me," he says, holding up his dog-eared Chinese translation of Friedrich Hayek's "The Road to Serfdom." Hayek's book, he explains, was originally translated into Chinese in 1962 as "an 'internal reference' for top leaders," meaning it was forbidden fruit to everyone else. Only in 1997 was a redacted translation made publicly available, complete with an editor's preface denouncing Hayek as "not in line with the facts," and "conceptually mixed up."

Mr. Yang quickly saw that in Hayek's warnings about the dangers of economic centralization lay both the ultimate explanation for the tragedies of his youth—and the predicaments of China's present. "In a country where the sole employer is the state," Hayek had observed, "opposition means death by slow starvation."

So it was in 1958 as Mao initiated his Great Leap Forward, demanding huge increases in grain and steel production. Peasants were forced to work intolerable hours to meet impossible grain quotas, often employing disastrous agricultural methods inspired by the quack Soviet agronomist Trofim Lysenko. The grain that was produced was shipped to the cities, and even exported abroad, with no allowances made to feed the peasants adequately. Starving peasants were prevented from fleeing their districts to find food. Cannibalism, including parents eating their own children, became commonplace.

"Mao's powers expanded from the people's minds to their stomachs," Mr. Yang says. "Whatever the Chinese people's brains were thinking and what their stomachs were receiving were all under the control of Mao. . . . His powers extended to every inch of the field, and every factory, every workroom of a factory, every family in China."

All the while, sympathetic Western journalists—America's Edgar Snow and Britain's Felix Greene in particular—were invited on carefully orchestrated tours so they could "refute" rumors of mass starvation. To this day, few people realize that Mao's forced famine was the single greatest atrocity of the 20th century, exceeding by orders of magnitude the Rwandan genocide, the Cambodian Killing Fields and the Holocaust.

The power of Mr. Yang's book lies in its hauntingly precise descriptions of the cruelty of party officials, the suffering of the peasants, the pervasive dread of being called "a right deviationist" for telling the truth that quotas weren't being met and that millions were being starved to death, and the toadyism of Mao lieutenants.

Yet the book is more than a history of a uniquely cruel regime at a receding moment in time. It is also a warning of what lies at the end of the road for nations that substitute individualism with any form of collectivism, no matter what the motives. Which brings Mr. Yang to the present day.

"China's economy is not what [Party leaders] claim as the 'socialist-market economy,' " he says. "It's a 'power-market' economy."

What does that mean?

"It means the market is controlled by the power. . . . For example, the land: Any permit to enter any sector, to do any business has to be approved by the government. Even local government, down to the county level. So every county operates like an enterprise, a company. The party secretary of the county is the CEO, the president."

Put another way, the conventional notion that the modern Chinese system combines political authoritarianism with economic liberalism is mistaken: A more accurate description of the recipe is dictatorship and cronyism, with the results showing up in rampant corruption, environmental degradation and wide inequalities between the politically well-connected and everyone else. "There are two major forms of hatred" in China today, Mr. Yang explains. "Hatred toward the rich; hatred toward the powerful, the officials." As often as not they are one and the same.

Yet isn't China a vastly freer place than it was in the days of Mr. Yang's youth? He allows that the party's top priority in the post-Mao era has been to improve the lot of the peasantry, "to deal with how to fill the stomach."

He also acknowledges that there's more intellectual freedom. "I would have been executed if I had this book published 40 years ago," he notes. "I would have been imprisoned if this book was out 30 years ago. Now the result is that I'm not allowed to get any articles published in the mainstream media." The Chinese-language version of "Tombstone" was published in Hong Kong but is banned on the mainland.

There is, of course, a rational reason why the regime tolerates Mr. Yang. To survive, the regime needs to censor vast amounts of information—what Mr. Yang calls "the ruling technique" of Chinese leaders across the centuries. Yet censorship isn't enough: It also needs a certain number of people who understand the full truth about the Maoist system so that the party will never repeat its mistakes, even as it keeps the cult of Mao alive in order to preserve its political legitimacy. That's especially true today as China is being swept by a wave of Maoist nostalgia among people who, Mr. Yang says, "abstract Mao as this symbol of social justice," and then use that abstraction to criticize the current regime.

"Ten million workers get laid off in the state-owned enterprise reforms," he explains. "So many people are dissatisfied with the reforms. Then they become nostalgic and think the Mao era was much better. Because they never experienced the Mao era!" One of the leaders of that revival, incidentally, was Bo Xilai, the powerful former Chongqing party chief, brought down in a murder scandal last year.

But there's a more sinister reason why Mr. Yang is tolerated. Put simply, the regime needs some people to have a degree of intellectual freedom, in order to more perfectly maintain its dictatorship over everyone else.

"Once I gave a lecture to leaders at a government bureau," Mr. Yang recalls. "I told them it's a dangerous job, you guys, being officials, because you have too much power. I said you guys have to be careful because those who want approval from you to get certain land and projects, who bribe you, these are like bullets, ammunition, coated in sugar, to fire at you. So today you may be a top official, tomorrow you may be a prisoner."

How did the officials react to that one?

"They said, 'Professor Yang, what you said, we should pay attention.' "

So they should. As Hayek wrote in his famous essay on "The Use of Knowledge in a Society," the fundamental problem of any planned system is that "knowledge of circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess."

The Great Leap Forward was an extreme example of what happens when a coercive state, operating on the conceit of perfect knowledge, attempts to achieve some end. Even today the regime seems to think it's possible to know everything—one reason they devote so many resources to monitoring domestic websites and hacking into the servers of Western companies. But the problem of incomplete knowledge can't be solved in an authoritarian system that refuses to cede power to the separate people who possess that knowledge.

"For the last 20 years, the Chinese government has been saying they have to change the growth mode of the economy," Mr. Yang notes. "So they've been saying, rather than just merely expanding the economy they should do internal changes, meaning more value-added services and high tech. They've been shouting such slogans for 20 years, and not many results. Why haven't we seen many changes? Because it's the problem that lies in the very system, because it's a power-market economy. . . . If the politics isn't changed, the growth mode cannot be changed."

That suggests China will never become a mature power until it becomes a democratic one. As to whether that will happen anytime soon, Mr. Yang seems doubtful: The one opinion widely shared by rulers and ruled alike in China is that without the Communist Party's leadership, "China will be thrown into chaos."

Still, Mr. Yang hardly seems to have given up hope that he can play a role in raising his country's prospects. In particular, he's keen to reclaim two ideas at risk of being lost in today's China.

The first is the meaning of rights. A saying attributed to the philosopher Lao Tzu, he says, has it that a ruler should fill the people's stomachs and empty their heads. The gambit of China's current rulers is that they can stay in power forever by applying that maxim. Mr. Yang hopes they're wrong.

"People have more needs than just eating!" he insists. "In China, human rights means the right to survive, and I argue with these people. This is not human rights, it's animal rights. People have all sorts of needs. Spiritual needs, the need to be free, the freedoms."

The second is the obligation of memory. China today is a country galloping into a century many people believe it will define, one way or the other. Yet the past, Mr. Yang insists, also has its claims.

"If a people cannot face their history, these people won't have a future. That was one of the purposes for me to write this book. I wrote a lot of hard facts, tragedies. I wanted people to learn a lesson, so we can be far away from the darkness, far away from tragedies, and won't repeat them."

Hayek would have understood both points well.

4886  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Congressional races, 17 months to go, the ads are up on: May 24, 2013, 01:13:13 AM
First ad of the cycle is Michelle Bachmann touting that the House passed her bill, repealing Obamacare for the 37th time.

My first reaction is Oh no!  But on second thought at least it is an issue ad.  It doesn't really try to persuade but it makes clear her opposition as well as the importance and urgency of the issue. The ad should lead viewers to ask themselves, are we really going to change over our health care system to one that people don't want that is loaded with problems?
4887  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Case for Drones on: May 23, 2013, 03:05:01 PM

Excellent post BD, a very well reasoned article!  The unmanned aircraft used prudently can be an equalizer when fighting the martyr enemy who is not afraid of losing his own life.  Drone use against terror targets without a liberal uproar has been one of the few benefits we received by having Barack Obama as our President.  The movement to ban them will start as soon as a Republican again becomes Commander in Chief.  Understanding and assessing their value now is quite timely IMO.

The potential for mis-use is huge, and the blowback point is well covered.  Enemies and rivals will someday have these same capabilities that we will have to deal with.  The negatives do not change the positive case for having them and using them when needed for our own national security.
4888  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Benghazi and related matters on: May 23, 2013, 02:39:43 PM
"Administration officials agreed to remove all reference to Ansar Al Sharia , , ,"
What Orwellian clap trap!!!!!!!!!!!!!!!!!!
The purpose of the talking points was to have a statement of what officials could say publicly.  There is NO reason that I understand for them to have been modified at all.  The fact of the interagency-State-WH? discussions shows that the WH and State were seeking to manipulate what the CIA had already said could be said.  Do I have this right? 
Therefore to say the "WH agreed to remove" reads to me as an out and out Orwellian deception.

Do I have this right?

Yes, you have it exactly right.  The purpose of sending the representative of the administration to all major outlets to obscure the truth rather than reveal it, and they chose someone out of the loop that with no knowledge could not trip up on the follow up.  Obscure truth or tell the opposite of truth is what they almost always do on almost every issue, Bush tax cuts caused the housing collapse, a budget that never balances will not add a dime to the debt, and taxing only the richest among us will benefit the middle class.

Honest people can disagree about what to remove from a report for national security reasons, but honest people don't make up a false story for political cover to get through an election.

I can understand playing down the secret CIA presence.  I understand the human error or bad luck of underestimating the security risk.  I understand there might be good reasons why no terrorists have yet been brought to justice.  But there is no excuse imaginable for the stand down order leaving the rest left behind to die, and it is Orwellian for sure to send someone out to tell us the opposite of what really happened.

We endured the drama and photography from inside the situation room during the successful raid of the bin Laden compound.  The release of the details of that operation posed security risks as well, but it was worth it to the President for the political approval he gained.  We would also like to know during failure who was in the room and what decisions were made by whom and when.

Michael Moore spent 6 minutes of a movie showing that when George Bush was notified of 911 he kept reading to school children.  George Bush survived that and the country pulled together.  We have yet to learn anything about what this Commander in Chief was doing when his focus should have been on this crisis.  Our military would never order a stand down.  Only a civilian at a higher power than the highest General would or could do that.  David Axelrod from the Ministry of Disinformation owes the American people an explanation.
4889  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Cog. Diss. of Glibness: Building Distrust in Government One Scandal at a Time on: May 23, 2013, 12:32:16 PM
This President, oblivious to unintended consequences, is the master of them.  Who knew that withdrawing from war would spark new violence there, that abandoning support for an ally in Egypt would empower anti-Americans there, that launching a war on gun and ammunition sales would boost sales in that industry to record levels, or that launching a war against employers would come back to bite employees?  Who knew?

Now President Obama has achieved what President Reagan could only dream of:  Putting distrust of government on the front page of every newspaper, even the liberal ones, day after day after day.

President Obama's answer to every scandal is that this government is so large I have no idea what is going on in any part of it, please hand me a 5-iron.
4890  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Fact: Abortion hits black unborns at 3 times the rate of white. So what? on: May 23, 2013, 12:10:36 PM
Mentioned in CCP's post today and in Sean Trende's RCP Virginia Governor's race column, the (African American) new Republican nominee for Lt. Gov. in Virginia has made some politically controversial statements in his past.  One example from both sources was Jackson declaring that Planned Parenthood had killed more African-Americans than the KKK.  (

But is it true or is it false?  If it is true and if there is nothing wrong with it, what is wrong with pointing it out?
4891  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Political Economics: Growth Economics on: May 23, 2013, 11:57:01 AM
As tempting as the scandals may be to dwell on, if we do not spend 51+% of our time focused on solutions, our problems associated with history's worst recovery will never get solved.  Here is Rich Karlgaard at Forbes with a dose of economic common sense.  I don't think economist Brian Wesbury would disagree with a word of this; he just currently makes a living helping people make money in a low growth / no growth economy.

Forbes  (Excerpt)
5/22/2013 @ 11:50AM |3,325 views
Sure Thing: Growth Is Not An Option

...growth is a moral requirement, for no other reason than that the opposite of growth is stagnation–a death of sorts.

Now to the economy: In round numbers the U.S. is a $16 trillion economy, which has been expanding at an annual 2% real (i.e., noninflationary) rate since June 2009. Each year we add $320 billion in real economic activity, which translates into 2 million to 3 million jobs and about $60 billion in federal tax receipts. We could use more jobs, and most of us want to cut the federal deficit and debt; therefore, growth is a good thing.

But the U.S. should be growing at 4% right now. Each year we should be adding $640 billion in new activity, creating 4 million to 6 million new jobs and adding $120 billion in federal tax receipts. Why 4% growth? America has averaged 3% growth since World War II, but during those 68 years we have suffered 11 recessions, including the 2007-09 whopper. When the country isn’t in recession, 4% annual growth is quite normal.

Too many economists and pundits have thrown in the towel, saying that 4% growth is no longer possible. This argument is based on two factors: the law of large numbers (i.e., 4% growth off of a $16 trillion base is much harder to reach than 4% growth off of a $5 trillion base) and the generational problems we face (a growing part of the U.S. population is either too young or too old to work to add to our statistical productivity).

We face challenges, of course, but getting back to 4% nonrecessionary growth is a moral requirement, and we must find ways to do this. If we care at all about jobs and deficits, choosing the right policy levers to lift economic growth should be the country’s highest priority.

So what kind of policy would get us from 2% growth to 4% (aiming for a long-term 3% to cover the inevitable downturns)? Lower, flatter and simpler taxes. Sensible regulation. Stable currency. Entitlement reform. A true health care revolution hitched to technological progress, entrepreneurial energy and market pricing. That should do it.  (more at the link above)
4892  Politics, Religion, Science, Culture and Humanities / Politics & Religion / The IRS political targeting scandal: Sorry about that little IRS error on: May 23, 2013, 10:42:17 AM
I think it was a House member who said when they break into the bank, we assume it is for the money, and when they step on the free speech and political association rights of tea party groups we assume it is for partisan political reasons.

But imagine you made the mistake to the IRS and make your apology back to them.  This letter was published in the Philadelphia Inquirer yesterday:

Sorry about that little IRS error
May 22, 2013  Philadelphia Inquirer

By George Parry

Dear Internal Revenue Service:

Regarding your targeting of conservatives before the presidential election, I found last week's testimony by your former commissioner to be very reassuring. As he explained it, what appeared to be your intentional and politically motivated punitive, totalitarian, and chilling measures against conservative groups and individuals in a clandestine effort to affect the outcome of the election were, in fact, simply the inadvertent consequences of "horrible customer service" provided by a bunch of flunkies in Cincinnati. What a relief!

Which brings me to the purpose of this letter. As you may recall, my business is being audited for reporting gross annual income of $12,125 when, as your revenue agents have so snarkily noted, the actual figure is closer to $9.75 million. As I have repeatedly explained, though I signed the tax return as CEO, this regrettable mistake is attributable to Trixie, our bookkeeper who forgot to disclose in her job interview that she had failed arithmetic for seven straight years before dropping out of grade school and joining an outlaw biker gang.

To further explain, when I first met Trixie in a Las Vegas hot tub, she was employed in the escort hospitality industry. Though I found her to be amply well-qualified for a position under me, I must admit that the subject of her math skills may not have been sufficiently discussed under the distracting circumstances. Boy, have I learned my lesson! No more job interviews of bikini-clad women in hot tubs!

In any event, I wish to apologize to you for the somewhat inaccurate tax return and the horrible customer service that produced it. Once I learned how the error had occurred, I immediately removed Trixie as bookkeeper and put her in charge of our Obamacare Compliance Unit. So, as you can see, we took the problem seriously, and it has been solved.

In light of my sincere apology and prompt corrective measures, I ask that you cease your efforts to collect all back taxes, penalties, and interest. Hopefully this apology will mark a new beginning to our relationship, one based on mutual trust and belief in each other's integrity.


L. George Parry

P.S. And could you also ask the Justice Department to withdraw Trixie's grand jury subpoena?

George Parry is a former state and federal prosecutor practicing law in Philadelphia.
4893  Politics, Religion, Science, Culture and Humanities / Science, Culture, & Humanities / Re: Race and shallow, deceitful NYT columnists on: May 23, 2013, 09:57:18 AM
Thanks CCP for posting.  The people Blow attempts to rip make more sense than the columnist.

"The Democrat Plantation theology goes something like this: Democrats use the government to addict and incapacitate blacks by giving them free things — welfare, food stamps and the like. This renders blacks dependent on and beholden to that government and the Democratic Party."

The data mining people on the campaign know that in large numbers, not for all, this is true.  Did Blow or his newspaper ever investigate the campaign for exploiting that?  ACORN and community organizing in the day of Barack Obama's involvement in it was EXPLICIT in their support for "welfare rights", never supporting economic liberty or prosperity through free enterprise.

"Herman Cain, for example, built an entire presidential campaign on slave imagery."

Herman Cain had a Master's degree in Computer Science, rose to the highest levels in business based on performance, not tokenism, served as Director of the Kansas City Fed and built his campaign on a tax reform plan that, if implemented, would have cut the black unemployment rate in half and same for every other demographic, without spending an additional dime on plantation welfare programs.

Why do these vacuous, liberal, NY Times opinion writers need to rely on lies and false premises to make their point?  If you must mislead to make a point, maybe your point is wrong.

I would note however that if 98% of blacks are voting Dem, the other 2%, including some mentioned by Blow, have turned out to be some of the smartest and most courageous people in our country.  I notice he didn't take on Thomas Sowell, or try try to debate Walter Williams on welfare economics, and had to twist Carson's views in order to slam him.

With Romney, it wasn't based on race Romney himself has said that statement was COMPLETELY wrong.  

Blow's real point is that liberals feel quite threatened by the rise of a small number of black conservatives and take every occasion they can to put them down.
4894  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Washington Post: The Most Curious Whopper in the IRS Story on: May 22, 2013, 11:04:09 PM
The IRS targeting scandal is a blockbuster that is sweeping the nation.  Imagine if the reaction to it now was the reaction to it then, if made public heading into the summer before the election, when Obama was ripping Romney's business background and Sandra Fluke was making her plea for free birth control - at a Catholic College.

The President's Chief of Staff knew and the President didn't.  

A special prosecutor in the IRS matter is inevitable

By Ed Rogers, Published: May 22, 2013 at 10:56 amE-mail the writer

This administration’s management of the Obama Internal Revenue Service scandal so far consists of a slow-walking, rolling disclosure of facts; equal parts equivocation, amnesia and indignation from IRS witnesses; deer-in-the-headlights non-responses by the White House press secretary; parsed, lawyerly statements from the president himself; and now one of the central key players is taking the Fifth. And all this comes from what the president claimed would be the “most transparent administration ever…”

If we give the president the benefit of the doubt and assume he knows the truth is going to come out, the question remains: Does the administration appoint the special prosecutor sooner or later? The calculus inside the White House is how to best protect the president’s political interests. They have two options. They could delay the appointment and let more of the story develop, weather the ugly piecemeal disclosures, give the players time to get their stories straight and lawyer-up and hope Republicans continue their overreach, giving the whole affair a nutty partisan patina. Or, they could accelerate the appointment of a special prosecutor, thereby slowing the congressional inquiries and giving Jay Carney some relief from his daily embarrassing routine by supplying him with the escape hatch of not being allowed to comment on matters associated with the special prosecutor’s ongoing investigation. Not to mention, the White House all the while could blast the appointed counsel as a partisan ideologue à la the hatchet job that was done on Ken Starr.

Anyway, if the president is innocent, he will end up needing and wanting a special prosecutor sooner rather than later. If he and his White House already have too much to hide, then they must clam up, cry partisanship and hope their allies on the Hill and in the media have the stamina for the long, hard slog ahead.

- – - – -

My personal favorite of all the new revelations from the Obama IRS scandal is that White House Counsel Kathryn Ruemmler told White House Chief of Staff Denis McDonough about the impending IRS inspector general report, but of course the White House chief of staff did not tell the president.

I sat in a White House chief of staff’s office every day for more than two years. The only reason the legal counsel would tell the chief of staff about an impending report or disclosure would be so the chief of staff could tell the president. The legal counsel would assume the chief of staff would know how and when to bring up the matter. The chief of staff would be expected to know if there were additional factors surrounding the issue that needed to be considered before the president was told, or whether or not others needed to be included in the conversation when the information was shared with the president. There are many valid reasons why the chief of staff would tell the president, but I can’t think of a reason why he and the legal counsel would both agree that this news nugget would go no further. It’s very odd.

The legal counsel would never assume that information shared with the chief of staff would not go to the president. In my experience, a legal counsel never would believe that there was information that was appropriate for the chief of staff to know but that was inappropriate for the president to know. Out of all the news that has emerged regarding the Obama IRS scandal, this is the most curious whopper I’ve heard so far. I can’t wait to hear the real story.
4895  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Eli Lake: Most U.S. officials in Benghazi were CIA using State Dept cover on: May 22, 2013, 10:48:02 PM
Eli Lake:    "While the State Department was responsible for elements of the security for the diplomatic mission at Benghazi, the mission itself was used primarily for intelligence activities and most the U.S. officials there and at the nearby annex were CIA officers who used State Department cover.  That purposeful ambiguity between diplomatic and intelligence efforts abroad has meant that at home, the State Department has taken almost all of the public blame for an error that was in part the fault of the CIA."

Democrat Walter Russell Mead:  "[Benghazi] scandal still has legs."

"This is a combustible situation. In the struggle to defend themselves, each of these dueling bureaucracies is likely to leak information that casts its rival in a poor light—and there are some signs that there may indeed be more shadows in need of illumination. More headlines about Benghazi are the last thing that Team Obama, as well as Team Hillary, want to see right now. But if Benghazi can’t be buried, these teams, too, will get in on the Blame Game.

And finally, as the top brass at State, CIA, Camp Clinton and the White House all try to wash their hands of the scandal, they will deal with the problem of underlings who refuse to be scapegoated. Furious at taking the fall for decisions made far above their pay grade, lower level officials will reach out to the press. Stories like this are like a fire in an ash tray; its flames may not reach all that high, but it can smolder for a long time and really stink up the room.

Don’t count Benghazi out of Scandal Season yet. So much went so wrong in so many ways, and the administration has tried so hard to keep a lid on the whole smoldering mess, that we suspect there are plenty more details waiting to emerge."
4896  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Rep. Raul Labrador: Obamacare could stop Immigration Reform on: May 22, 2013, 10:40:53 PM
Raul Labrador warns that Obamacare could kill immigration bill

(Doug: Let's do it the other way around, let immigration reform kill Obamacare.)

Also Labrador pledged that he would not support a bill that breaks the so-called Hastert Rule – meaning that for him, immigration reform legislation must have the backing of at least half of House Republicans.

By SEUNG MIN KIM | 5/22/13 2:13 PM EDT

A key House Republican negotiator on immigration is warning Democrats that the health care law – a favorite boogeyman of the GOP – could be the downfall of comprehensive immigration reform.

“What might be the story at the end of this year, at the end of this session, is that Obamacare killed immigration reform,” Rep. Raul Labrador said Wednesday. The Idaho Republican is one of eight House lawmakers who have engaged in private talks on immigration reform.

The health care law has flared up as a major problem in those talks; group members declared last week that they had struck a deal “in principle” but have yet to work out the fine print.

House Democratic leaders are uneasy with the idea of blocking undocumented immigrants from accessing publicly-subsidized care – such as health coverage if they have to be treated in an emergency room. That could have the effect of deporting the immigrants if they can’t afford those expenses, Democrats worry.

Republicans, however, are insisting that no public dollars – from federal to the local level – will fund the tab for health coverage for the estimated 11 million undocumented immigrants. Negotiators are looking at an end-of-the-week deadline to smooth out the differences on health care between the two sides.

While the Senate Judiciary Committee cleared a major hurdle Tuesday by passing the Gang of Eight legislation and sending it to the Senate floor, the House group is struggling to finalize its tentative agreement.

One of its members, Rep. John Carter (R-Texas), floated the idea of releasing a plan in the first week of June, but this latest dispute over health care throws that timeline into doubt.

“I think [Democrats] just need to accept that the American people are not going to be responsible for the health care costs of the people that are here illegally,” Labrador said Wednesday. “That’s been a fundamental issue for me from day one, that it’s not going to come out of the pockets of the American people.”

Labrador also pledged that he would not support a bill that breaks the so-called Hastert Rule – meaning that for him, immigration reform legislation must have the backing of at least half of House Republicans.

On one issue – a new guest-worker program for lower-skilled immigrants – the two parties have already decided to go separate paths. The Democrats will present the plan in the Senate bill that was negotiated by the U.S. Chamber of Commerce and major labor unions.
4897  Politics, Religion, Science, Culture and Humanities / Politics & Religion / 'Hope and Change' is now 'Comfortably Numb': "Is there anyone home?" on: May 22, 2013, 10:34:11 AM
Bob Schieffer, of all people, on Charlie Rose, CBS News, of all places, inadvertently draws the parallel between this administration's handling of it's affairs and the struggle of a young, medicated rock star dealing with illness, Roger Waters of Pink Floyd in Comfortably Numb.  "Is there anyone home?"

Bob Schieffer with Charlie Rose, 5/16/2013:

"This is more of a case, is anybody home? All of a sudden you have this thing with the Justice Department where they’re getting all these phone records of all the reporters. The Attorney General, well he didn’t know anything about it. You get to the IRS, they don’t seem to know anything about the Tea Party thing. You come to White House, they don’t know anything about Benghazi. Somebody’s got to grab hold of this thing. It’s very, very disturbing what we’re seeing here."

Roger Waters saw it decades ago and called it "Comfortably Numb" (Pink Floyd, The Wall, 1979), brought to life with music and guitar solo by David Gilmour:

Hello, Hello, Hello,
Is there anybody in there?
Just nod if you can hear me
Is there anyone home?
I'll need some information first
Just the basic facts
Can you show me where it hurts?
I can't explain
You would not understand
This is not how I am
I have become Comfortably Numb
You are only coming through in waves
Your lips move
But I can't hear what you're saying
The child is grown
The dream is gone
I have become Comfortably Numb
4898  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: Cyberwar and American Freedom on: May 21, 2013, 06:06:42 PM
It amazes me that the world's largest economy doesn't have leverage to influence hardly anyone on anything.  Assuming the European Union has the same interest in this that we do, one might think that the EU and US combined would have economic leverage with China. 

So we shame them.  Scary!

Since we are talking about warfare, blowing up the building might make an impact - just thinking aloud - or more realistically, shut down their internet until they understand our concern.  We avoid bad choices by making the good ones work.  Unless there is something effective happening behind the scenes, this is another case of our Commander in Chief not even voting present in his responsibilities.

If he went after enemies, terrorists and geopolitical rivals with the zest that the uses to attack the tea party, Rush Limbaugh and Fox News, they might think twice before messing with us.
4899  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Breitbart on: May 21, 2013, 05:35:22 PM
I met Andrew and hung out briefly with him at CPAC a couple of years ago, and he was a very friendly, extremely smart and generous individual with his time. He is sorely missed.
The way he was treated by the liberal press both during his life, but even worse - after he died unexpectedly of a heart attack - was ABOMINABLE.
He was a true pioneer and fearless bulldog with citizen reporting and exposing lies the mainstream media would routinely ignore or try to cover-up. Those who hated him, hated him precisely because he told the truth about their nefarious activities. Please see this film - and take 5 seconds to request the movie by shown in your area by clicking on the link below:

Yes.  He is a legend in new media.  Rising from pizza delivery boy to editor of Drudge, launching the Huffington Post and on his own web site, he personified the first amendment.  He died at least a half century too soon.  You are fortunate to have met him.  Like Drudge, he was out front getting stories out that otherwise would get buried.  He was committed to making a difference in the 2012 campaign when he died.  Nothing short of untimely death could ever have stopped him. 
4900  Politics, Religion, Science, Culture and Humanities / Politics & Religion / Re: The Cognitive Dissonance of the left on: May 21, 2013, 12:43:00 PM
Oops, this elected leftist wasn't joking:

"When cyclones tear up Oklahoma and hurricanes swamp Alabama and wildfires scorch Texas, you come to us, the rest of the country, for billions of dollars to recover," he said. "And the damage that your polluters and deniers are doing doesn’t just hit Oklahoma and Alabama and Texas. It hits Rhode Island with floods and storms. It hits Oregon with acidified seas, it hits Montana with dying forests. So, like it or not, we’re in this together.”

He continued, "You drag America with you to your fate."

  - Sheldon Whitehouse, United States Senator, not the Daily Show, Democrat of Rhode Island

I wonder what the uproar would be if a Republican Senate candidate said something similar.  They wouldn't become a U.S. Senator.
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