Archive for category Individual Freedom
July Hayek Dinner: State of the Economy
Posted by Tom in Centrally Managed Economy, Deficit, Economics, Employment, Financial Crisis, Financial Policy, Government Regulation, Individual Freedom, Monetary Policy, National Character, National Debt, Statism, Yucca Mountain on July 21, 2010
Our thanks to Tom Cargill for the excellent presentation last evening and to Jerry O’Driscoll for arranging the meeting in my absence.
Jerry opened with a snapshot on employment trends from selected countries since 2008. The US is at the bottom of the pile and trending down!
Tom picked it up from there with a quick look back on the first decade of this century focusing on four remarkable points: 1. US homeland is vulnerable to attack since 911; the first since the war of 1812. 2. Critics of the market are strong despite the increase in standard of living in the last quarter century. 3. Failures of the welfare state notwithstanding, the US is moving toward socialism. And, 4. the political force toward socialism can be traced to our current great recession.
Technically, the recession is still in full force. The question is what kind of recovery will come, weak flat “U” or “J,” or a double dip. Ten key points are apparent:
- the US has not seen more economic, financial, and political distress since the Great Depression.
- our recession was not caused by market failure but mainly by government failure, both monetary with low rates too long and fiscally with housing policies of Fannie-Freddie.
- yet, the public hypnotized by Obama rhetoric believes market failure was the cause.
- admittedly, the $700 billion financial bailout was necessary to prevent a liquidity crisis.
- but the five “stimulus” packages ignored history and had a negative effect, negative Keynesian multiplier, on the GDP. Wasteful spending directed to leftist programs.
- while we now see some GDP growth, the private sector is not creating jobs and budget pressures will force a decline in public sector employment.
- the private market is not creating jobs due to the great uncertainty of the rules of the game; we are going to state directed allocation of resources not market directed allocation.
- Adam Smith calls man an economic animal, “truck, barter, and exchange” but the uncertainty of the rules creates inefficiencies that lower growth potential.
- the economic game becomes even more uncertain because of the greater role of government; what happens to the chess game if it is announced in the middle of the game that there will be a rule change; Obama is regularly announcing rule changes to come!
- QED, the most likely “recovery” is a flat “J” over the next several years with a chance of a double dip.
Tom now thinks the chance of a double dip is 50/50, an increase from his earlier thinking. Potential economic shocks which will push toward a double dip are: the dramatic increase in taxes next year, and the questionable stability of the European Union. The current divergence in fiscal policy between the overspending US and the rapid austerity in Europe may well be a third negative shock. Tom concluded saying that only a change in the US congress and administration will offer hope of a solid recovery.
We thank Beth Powers and her crew for her comments and patriotic efforts with LibertyInAmerica.org. Please consider a donation to help continue the fine bus treck.
John Dunn provided a positive report on Yucca mountain efforts, see NV4CFE.org.
Finally, our thanks to Mike Herring for treating the group to dinner and drinks, this an an inducement to make contributions to Sharron Angle’s campaign to retire Dirty Harry.
Unprotected Against Jihad
Posted by Tom in Defense, Foreign Policy, Homeland Security, Individual Freedom, Law, Morality & Religion in the Public Square, Military Policy, National Character, Terrorism on June 1, 2010
Hussein Obama’s counterterrorism tzar, John Brennan trivializes the danger of Islam according to Andy McCarthy in today’s NRO post, An Islam of Their Very Own. The article is a must read with only two conclusions possible: Obama is stupid or naive or he is converting the U.S. to sharia, that is Islamic law. In essence, become Muslim or die, so ruled Mohamed after his militant successes.
“Brennan admonished that we must not “describe our enemy as ‘jihadists.’” Why not? “Because jihad is a holy struggle, a legitimate tenet of Islam.” Right again. There is no gainsaying that jihad is deemed to be a divine injunction in Islam. If one regards all forms of Islam as “legitimate,” then jihad, too, must be legitimate. Yet “legitimate” is a slippery concept. It could mean that something is good. Or it could just mean that something is authentic — something that really exists, for good or ill.
“Islam falls into the latter category. It exists. In many of its iterations — not just al-Qaeda’s ideology but Islamist ideology, which is quite mainstream — Islam means the West existential harm. This is why we are supportive of reformist Muslims, however pessimistic some of us may be about their prospects. The point, though, is that Islam is not going away. It is part of the hand we are dealt, like it or not. We don’t need to trash-talk it gratuitously, but neither should we pretend that it is an asset on our security ledger. It’s not.
“Alas, the Hope administration doesn’t see it that way. For Brennan, as for Obama, Islam is immovably in the first category: “legitimate” as in “good” — end of discussion. To sculpt this alternative reality, two things are required. First, we must ignore Islam’s many troublesome elements — e.g., its supremacism, inequality, intolerance, denial of freedom of conscience, endorsement of violence, etc. Second, to the extent that the resulting atrocities can’t be ignored, we must pretend that what ails the Islamic world is our fault, not Islam’s.”
Andy’s point echos the points made during Herman Pirchner’s presentation and discussion at our last Reno Hayek dinner, namely that radical Islam and its Jihad is closer to the Koran than any reformist/secular branch of that “religion.” I put that in quotes to denote that it is more than just our concept of “religion;” it is government, society and religion in the sense that Mohamed imposed upon his conquests.
Here’s my empirical observation: not many, if any, Moslems have condemned the Jihads, the terror, the 911 carnage, the call to exterminate Israel.
These people are backward, immoral, intolerant, and violent. They advocate or tolerate “supremacism, inequality, intolerance, denial of freedom of conscience, endorsement of violence, etc.” For them, the end justifies the means, no matter how distorted either end or means in reality are. They blow themselves up in hopes of “virgins in heaven.” Pity those few virgins in number! But, that is the level of their intelligence.
Hussein Obama apparently ignores “man caused disasters.” Islam is good because he wishes it so. This is contrary to the reality that we witness every day. Islam is bad.
“Our political leaders can continue to trivialize jihad as if it were some benign struggle to brush after every meal. They can continue to ignore the core tenets that make sharia antithetical to a free, self-determining society. But they can’t do that and do the only job we need them to do: protect our lives and our liberties.” Andy McCarthy’s article is a must read.
Hussein Obama is hell-bent-for-leather to “hope and change” the United States into an Islamic nation under Sharia law. Be very fearful for our nation.
“I am Ann Frank”
Posted by Tom in Foreign Policy, Individual Freedom, National Character, Terrorism on April 27, 2010
This, one of the powerful ending lines in Jeffrey Lord’s American Spectator article, Jon Stewart Flunks His Spartacus Test, in which Stewart’s position on Comedy Central’s censorship of South Park’s episode on Islamic fanatics is slammed. Lord sets the courage test in terms of Kubrick’s Spartacus, the iconic film of the Greek gladiator at Capua and his courage to the last. With that in mind he fast forwards to United Airlines Flight 93 on 911 where ordinary Americans were confronted with their Spartacus moment and proudly passed the test earning our tribute or what the ancient Greeks would call arete, courageously living up to their full potential, excellence.
Faster forward to today and the edgy, over-the-top, iconoclastic South Park created by Trey Parker and Matt Stone who decided to take on Islamic Fascists but gently by disguising the Prophet Mohammed as a bear. A web site called “Revolution Muslim” warned the creators that they would end up like Theo Van Gogh, the Dutch film maker killed by Islamic terrorists after he made a film on the treatment of Muslim women. This fatwa put the fear of Allah into Comedy Central which promptly bleeped a 35 second speech warning of “fear and intimidation.”
Now to Jon Stewart, darling of the leftists, brave defender of Democrats, epitome of all moral good. Jon gets his chance to stand up for Free Speech. Jon get his “Spartacus test.” What say, this paragon of leftist virtue, when confronted with intimidation based censorship by Comedy Central?
“It’s their right,” he said of Comedy Central in a verbal shrug of indifference. “We all serve at their pleasure.” In other words, they sign the checks!
The problem is that these Islamic terrorists want to bury us. “American and Western culture — the good, the bad and the ugly of it over a few thousand centuries, from Plato to Parker and Shakespeare to Stone — can thrive only in an atmosphere of intellectual freedom. That freedom, as has been made abundantly clear since 9/11, is under full scale assault.”
“The right answer is never to pretend that if you somehow were transported back in time, say to a house in Amsterdam in August of 1944 and the German Grüne Polizei were pounding at your door, you could get away with saying: “Hi. Fox News can %$#@@ themselves. You guys sign the checks. Seig Heil. Ann Frank is upstairs, third door to the right, the room behind the bookcase.”
“The right answer would be, the right answer is always: I am Ann Frank.”
The clever, liberal leftist, Jon Stewart gets an F on his Spartacus test. For all practical purposes, his Obama Hussein idol with his fawning Mideast diplomacy has also flunked the Spartacus test. A great article by Jeff Lord.
PC Cowardliness–Caving To The Towel-heads!
Posted by Tom in Humor, Individual Freedom, Law, Morality & Religion in the Public Square, National Character, Press on April 24, 2010
Sadly disappointing news that Comedy Central backed down to death threats against “South Park” creators Trey Parker and Matt Stone and bleeped an episode warning against “intimidation and fear” by Islamic fanatics who were offended by the show. Heretofore the network has stood behind nearly all the over-the-top satire despite protests and calls for boycotts.
But where Islam and the prophet Mohammed is concerned, the First Amendment’s guarantees of Freedom of Speech and Freedom of the Press no longer apply.
Even sadder that the supposedly “fair and balanced” Bill O’Reilly questioned the creator’s judgement in writing and producing the piece. Towel-heads have Bill a bit unbalanced perhaps. See Diana West’s Media Leave “South Park” Creators Out to Dry in Real Clear Politics.
The conclusions of the New York Post article, Cowardly Central are appropriate here: As UCLA law professor Eugene Volokh noted, the consequence of Comedy Central kowtowing to a blatant death threat “is that the thugs win and people have more incentive to be thugs. Behavior that gets rewarded gets repeated.” Alas, regarding radical Islam, the behavior that “gets rewarded” is murder — Exhibit A: Theo Van Gogh. Revolution Muslim may be little more than a couple of Queens cranks with Web access — but who’s willing to take a chance on that? Not Comedy Central, that’s for sure. And until the West decides — culturally and collectively — not to take it any longer, it’s only going to get worse.
“Land of the Free and home of the Brave?” No, not at all. We have already been conquered by “fear and intimidation!” Practice your Sharia law, you attorneys, because before long that’s what will govern us.
Philosophical Ramblings
Posted by Tom in Constitution, Individual Freedom, Law, Morality & Religion in the Public Square, National Character, Taxation, Welfare on April 22, 2010
Saw one of my favorite Docs today and told him of the dismal projections for our country discussed at this week’s Reno Hayek Symposium Dinner, the current and future deficits, the debt, the unfunded liabilities and on top of all this the Omamacare sludge hammer. We both pondered the “no way out-no apparent solution” future. The concern here is for our children and grandchildren. And, its not that they can’t be better, be more independent than we, but that we are saddling them with unimaginable debt burdens so bad that they can’t be overcome no matter how strong they are.
We then discussed the untenable tax burden necessary to barely maintain but not reduce these entitlements, their corresponding debt and merely the interest cost necessary to maintain both. This is not a tax the rich issue, the rich will no longer be here or anywhere for that matter. This is a gigantic burden on the middle class; the less-than-middle class pay no taxes, and in fact have payments going to them. The anticipated 20% VAT tax atop the increased income tax and estate tax will not come close to solving the problem. In fact this tax on consumption will merely accelerate the downward spiral in our consumption based economy. This because consumers will be further forced to hunker down, down to a subsistance existence.
We pondered the all-but-impossible solution of reducing entitlements arguing its necessity but also its political impossibility. Then we broached the real issue, equality.
This, discussed initially in medical services. Should we all be entitled to the best, the Mayo clinic, the latest technology? Or should only those who can afford the best be able to buy it? In Europe it is the entitlement scenario, but the best becomes the non-best. This because the best requires capital investment at risk for long duration and problematic results. My Doc pointed out that med-tech investment is down! In Central America medical treatment and services are pretty good and the tech used is state-of-art but only for those who can afford it. The lower classes are relagated to a lower level of care above first aid but not the best available.
What as a society do we want for our society? What as a society can we afford for our society?
I think it gets down to two issues: the proper role of government and the moral responsibility of the individual. Government must defend our shores first and formost. It must enforce criminal laws protecting person and property. It must maintain a system of civil justice resolving disputes between citizens. And given our republic structure it must resolve issues between states. Finally it must provide for its continuance, succession and amendment. Our founding fathers pretty well set this out initially in the Declaration of Independence and later in the Constitution.
I think the proper role of the individual is to provide for himself and his family; that is food, shelter, education and protection. Beyond that the individual must be a contributing member of society helping his fellow man in need. This frequently through synagogue, temple or church and also through voluntary community societies. The individual must also be a responsible citizen, voting, volunteering, and participating in government offices when elected or appointed.
What of equality? What of entitlements? We are not “all created equal” nor has history shown us to be “endowed by our Creator, with certain unalienable rights” of life, liberty and the pursuit of happiness. The closest we come is to expect “equality of opportunity” despite our limitations. “Equality of result” is never attainable. Nor are we “entitled” to be equal. We struggle to do our best for ourselves, our families and our society. But we are not entitled to nor should we be guaranteed the same as everyone else.
This realization gives us the opportunity to help others, to be charitable, to do moral good. Including providing charitable hospitals and medical care, to get back to the earlier example. Here the government has no role; it is the exclusive role of the individual with other individuals alongside.
So, to prevent or at least mitigate the greatest intergenerational immorality in our history, we must limit entitlements, reducing and means restricting social security, medicare, medicaid and Obamacare. Keep in mind our grandkids have no voice, they are innocent of our current theft of their future. Our parents, the greatest generation, left us a better future but perhaps one too soft. Will we do worse by our children and grandchildren?
What’s Obama Up To?
Posted by Tom in Centrally Managed Economy, Deficit, Democrats, Economics, Financial Crisis, Individual Freedom, National Character, National Debt, Nationalized Health Care, State Finances, Statism, Taxation on March 5, 2010
On paper Obama appears to be a smart guy and reasonably well informed. I suspect he knows:
- We face $1.4 Trillion annual deficits for the next decade.
- Our current national debt is $12.3 Trillion and will grow by $1 Trillion a year.
- Estimated unfunded liabilities from social security and medicare are $107 Trillion.
- States with aggregate deficits of $350 Billion, debt of $1.9 Trillion, and unfunded liabilities of $1.4 Trillion are asking for federal handouts.
- Unemployment is 9+% with private sector growth stalled.
Why then would he promote a radical takeover of healthcare with 10 year costs of $2.3 Trillion that adds $1.86 Trillion to the deficit over the next 20 years, that creates employment taxes and mandates, each discouraging private sector employment, and that fails to solve the demographically certain failure of medicare, social security and medicaid? We’ve proven our inability to handle two, no three if you include medicaid, major entitlements, why add another? And why would he risk his party’s control of Congress and his own ability to govern to attain this goal that a majority of Americans don’t want?
Obama is smart enough to know that Obamacare will exacerbate the financial straights of the United States. It’s uncertainty will decrease private sector employment. It’s taxes will decrease private capital for investment. It will cede financial and technological leadership to other countries. In short, we will be worse off tomorrow than we are today. Why would he risk that…want that?
It is clear that he knowingly intends to drive us further to the brink. It is also clear that given his apparent intelligence he has an end-game in mind. Take our admitted crisis, you know the “never-let-a-crisis-go-to-waste” kind, explode it into a gigantic, off-the-clff catastrophe, then come up with a one-of-a-kind, popular solution that involves “shared pain” and if we are all lucky, someday “shared gain.” Call it a Cloward-Piven Strategy on steroids. (See: Cloward-Piven Strategy: Is It Obama’s? and references cited therein.)
As Larry Kudlow said in NRO, One Giant Government Leap Backwards,” One of the most galling features of this plan is a taxpayer-subsidized government-insurance entitlement for people earning up to 400 percent above the poverty line, or nearly $100,000 for a family of four. In other words, a middle-class health-care entitlement that will add millions of people to the federal dole. It’s all too reminiscent of the political dictum of the old New Dealer Harry Hopkins: tax and tax, spend and spend, elect and elect.”
So will Obama’s “Fiscal Responsibility and Reform Commission” turn out to be the VAT Commission with a European 12% sales tax on top of the income tax, excise tax, etc. And those on top of the various state sales, income and property taxes? All this to finance BIG GOVERNMENT? If so, we will then all have the advantage of being “in the same boat,” “equal,” and “happy” in an ever declining country and economy.
So for the literarily inclined, Obama wants us on Hayek’s Road to Serfdom where we will encounter Orwell’s Animal Farm with 1984’s Big Brother in control. As Obama recently said in response to a push-back, “we won the election.” And win the next election and the next, he aims to do with the creation of more and more dependency on him and less and less individual responsibility.
I won’t be around to witness the outcome but I hope the next generation will become informed and engaged, lest our grandchildren and great-grandchildren suffer horrible consequences.
Tom Motherway
When Insurance Is Not Insurance
Posted by Tom in Deficit, Individual Freedom, Nationalized Health Care, Taxation on February 24, 2010
The Democrats’ goal of healthcare rapidly turned into health “insurance” care. This to supposedly provide healthcare to some inflated numbers of people who had no healthcare. But by law everyone has healthcare, just get to the emergency room and you will be cared for with or without insurance. So the leftist needed another tack to take over 16% of the U.S. economy. Thus Obamacare magically became Obama insurance.
Health insurance is not “insurance” in any true sense of the word. True insurance is a contingent indemnity against loss provided by a business that assesses and pools specific risks. As Clifford Asness states in his Bloomberg.com article today, “Don’t Ask” Is No Way to Run Health Care, “true insurance comprises two things: The first is a goal: to protect against very large losses. The second on is a method: the proper assessment and pricing of risk.” So fire insurance assesses the risk of occurrence of fire in a specific location and the expected degree of damage from fire in that location. Facts and circumstances like construction type, proximity to a fire plug or station, and repair or replacement costs are taken into account. Since others need such insurance like risks will be pooled and spread by the insurance company. To cover expected losses, that company will maintain reserves and beyond that has its owners capital. Companies can incur underwriting profits or losses depending on their experience in the specific insurance pools.
Health “insurance” in this country amounts to prepaid health care expenses. It does not indemnify against only large risks but prepays for every cold and sniffle. In fact it is practically speaking the only way in which medical providers get paid for their services. It is this fact–third party payment–that causes overuse and unnecessary costs.
Think about it. Employer provided insurance benefits are an expensive cost of compensation, yet they are not taxable as compensation to the insured employee, even though they are deductible to the employer. From the employee’s perspective, medical service is a free service.
“Having businesses offer full health coverage almost from the first dollar spent is phenomenally inefficient. Health care is over-consumed because it is essentially, at the margin, free to employees and too cheap — fully deductible — to the company. All incentive for the consumer to control costs is abandoned. Furthermore, the system is nonportable and famously bureaucratic, with the associated costs in time, money and frustration.
“To put the “insurance” back in health insurance, we need to remove the tax deduction for routine health-care expenses, whether the coverage is purchased by employers or individuals. If we choose to retain a deduction for insurance against large losses, it should apply equally to plans bought by individuals directly and those provided by employers.
“Among other benefits, this would remove a large tax deduction and the savings could be used to reduce other tax burdens. It would also solve the portability problem because without a tax advantage at work most individuals would purchase their own insurance. Most importantly, by buying their own insurance, designed to protect against only relatively large losses, individuals would become conscious of medical costs.”
In short, we need Consumer Driven Health Care (CDHC) where consumer pays for what he gets. He will spend economically both on high deductible insurance and generic drugs. His policy will be portable. It will be highly competitive if companies can cover across state lines and if tort reform reduces the costs of defensive medicine. With increased use of Health Savings Accounts costs will be further reduced. And yes, major pre-existing diseases can be inexpensively covered by subsidized high risk pools.
Tom Motherway
“Catholic Charities in Albany NY Now Providing Free Syringes to Addicts”
Posted by Tom in Government Regulation, Individual Freedom, Law, Morality & Religion in the Public Square, National Character, Politics, Statism on February 21, 2010
Another well-intentioned, liberal Bush idea that Obama has continued and enhanced is the Office of Faith-Based and Community Initiatives. Michael Tanner of Cato calls it Obama’s Faith-Based Boondoggle. Michael, who has video-conferneced with our Reno Hayek Symposium meeting, correctly states that, “the damage done by government co-option of private charity goes far beyond money.” His point is that the addiction of federal dollars soon distorts the purposes of the charity–by dependency, sloth and ultimate control.
The Bush/Obama program of leveraging government dollars by using low cost (sometimes free) charity workers, is better than creating another government department to accomplish some social (not religious) goal. But the point is that the charity would ultimately accomplish the same or near same goal with private dollars. In short, there is no need to spend government dollars. Excuse me, your tax dollars.
“Government funding is antithetical to the nature of charity. After all, the essence of private charity is that it is voluntary. Tax money is based on coercion. There is neither compassion nor love behind a grant of money forcibly taken from taxpayers who may have no desire to support the charity in question.”
“There is no reason for government to be in bed with private charity. Charity is thriving in America. We are the most generous nation on earth. Every year, Americans contribute more than $300 billion to charity. In addition, more than half of all American adults perform volunteer work. That time and effort is worth more than another $300 billion. And that does not include the countless dollars and time given to family members, neighbors and others outside the formal charity system. A few extra dollars from Washington add little to this amazing success story.”
The proper role of government is the crux of all political difference. Big and all-intrusive or small and limited, that is the question. Our founding fathers set up a limited federal government with checks and balances and specifically delegated powers. Roles and powers not delegated to the federal government by the people were specifically reserved to the states or to the people. The founding fathers would be shocked to see how far the federal government has evolved from their vision.
The principle of subsidiarity is an organizing principle that matters ought to be handled by the smallest, lowest or least centralized competent authority. This concept is applicable to government, management, and society. The parent, the family, the school, the church, the social group, the village, the city, the state and only then should the central authority, the federal government be competent to handle any given issue or concern. Let’s see… that would leave defense, postal service, national currency, and… what else to the federal domain? Read the constitution! You will be surprised.
Point is…if we continue to cede our obligations and our rights to the central authority, we will become dependent serfs….without moral fiber, character, or courage. That we can gather, speak, give to charity, volunteer, teach our children, defend ourselves and our families is our strength, our essence. Once ceded, never retrieved. Let charities do charitable work….yes even in healthcare!
A friend and member of our group on reading about Catholic Charities providing syringes to addicts in Albany wagged, “what’s next, condoms?” Makes me, a practicing Catholic, question– as have others–whether Catholic Charities is indeed Catholic, or for that matter, a charity!
Tom Motherway
Obama Wants Republican Ideas To Save Obamacare–Just Say No
Posted by Tom in Government Regulation, Individual Freedom, National Debt, Nationalized Health Care on February 11, 2010
Jay Cost has a great post today in Real Clear Politics, The Blair House Stunt. He posits Obama’s invitation to Republicans to advance their healthcare ideas as either an honest attempt at a bipartisan reform of healthcare or a political stunt. He concludes it is a political stunt meant to help the Democrats by hurting the Republicans. This for three reasons: a) it’s televised giving the glib snake oil salesman his foil over lesser debaters, b) the invitation was extended to party leaders not the more moderate/liberal Republicans, and c) there are only nine months before the midterm elections so why would the Republican leadership want to help put lipstick on this pig!
Jay Cost’s reasoning is persuasive. Obamacare is the albatross around the Democrats necks as recently demonstrated by Scott Brown’s Massachusetts victory. Recent polls show the public against the takeover of 16% of the economy.
Obama has said that he is not willing to start with a blank sheet of paper which is the only way to negotiate a compromise. He wants his core elements in Obamacare. Most of those core elements are statist, anti-free market, and deficit growing at a time when the nation is near bankruptcy.
So there is no real hope of bipartisan compromise given Obama’s ground rules. Why waste time the Republicans could better spend by going directly to the voters with a cogent set of reform ideas: 1) allow all insurance to be sold across state lines, 2) tax employer provided benefits as compensation, 3) encourage individual policy ownership and portability by allowing a modest tax credit, 4) expand Health Savings Accounts scope and deductibility so more attractive high deductible policies would come to market, and 5) enact serious tort reform to eliminate gross legal fees and defensive medicine. In short, this simple reform would make the patients the medical consumers responsible for their own insurance. It would reduce the overall cost of healthcare with increased competition and decreased lawsuit diseconomies. Finally, it would not add to the deficit and in fact would provide additional revenue to the treasury to reduce the deficit.
The Republicans should politely just say no to Obama’s invitation as it stands. At the same time it is reasonable to state the principles that are necessary for health insurance and healthcare costs containment. That can be done succinctly in a way that the voters will easily appreciate.
Tom Motherway
Who Owns Obama and the Democrats?
Posted by Tom in Democrats, Economics, Energy Facts & Policies, Environment, Individual Freedom, Politics, Unions, Wall Street on January 29, 2010
There are primarily four major political groups that literally own Obama, Reid, Pelosi and the rest of the Democrats: Unions, particularly the public employee unions. Trial lawyers. Environmentalists. And, Wall Street and Business Rent Seekers. The cost of these relationships to the economy and to our freedom is significant but difficult to completely quantify.
Unions. According to the latest figures overall union membership as a percentage of the workforce has held steady with 2008 at 12.4% and 2009 at 12.3%. Within that overall group, however, the private sector unionization declined from 7.6 to 7.2% while the public sector grew from 36.8 to 37.4%. It’s no secret that Obama favored the unions over the bondholders in his nationalization of GM and Chrysler. Nor is it a secret that his most frequent visitor is Andy Stern who will let you know what they spent to get Obama elected! Oh, and about 1 million of the federal work force are union members, 28% of the wage and salary workforce. As to the effects of this, see my post of January 7th Unions and Excessive Government Compensation.
Trial Lawyers. This is that monopoly of “professionals” who are licensed to represent real or pretended injured people for “contingency fees” of 25-50% of the awards obtained in trial or, more likely, settlement. These “injured” plaintiffs can be investors, cancer patients, or “whiplash” victims. Oftentimes the attorneys advertise to let them know they are “injured” or purchase new issue stock to become self fulfilling injured plaintiffs themselves! Recent cases have highlighted the manufactured testimony that these lawyers pay for, the perjury that they suborn. According to a recent post in OpenSecrets.org, during the last decade the trial lawyer given over 90% of their political contributions to the Democrats. In 2009 $2.86 Million to the Democrats and $140 Thousand to Republicans. Is it any wonder that there are no caps on medical malpractice damages in Obamacare? Thus big awards, large insurance premiums and defensive medicine will continue to drive up medical costs. (In the interest of full disclosure, I was once one of these trial lawyers, but as Woodrow Wilson said, “I have repented of it”)
Environmentalists. This is the most difficult economic drag and freedom surrender to estimate. Consider the ethanol debacle both in terms of costs and free market damage where the government pays producers to produce, forces customers to buy and restricts cheaper imports for a process and substance which increases greenhouse gasses! Consider the recent cap and trade bill passed by the House. Or, how about the CO2 we exhale and the EPA’s intention to regulate it as harmful! Has there been a cost-benefit analysis on the solar, wind, insulation state and federal tax and other subsidies or the wasted economic investment as a result thereof? And all of this for a “global warming science” in which the scientists manipulate the data!
Wall Street and Business Rent Seekers. Now we get to the folks we love to hate, the money guys who have long sucked at the Democratic teat. These folks spend the money to get the edge. They love cap and trade because they will become the traders getting the juice of commissions. They love Barney Frank’s push on Fannie and Freddie for more subprime mortgages because they generated fees from packaging and selling them as securities. Some felt “forced” to deal like drug companies, hospitals and insurance companies in the recent Obamacare debacle. Others just sought advantage over honest competition; in economic terms they are simply rent seekers.
These poor seekers of corporate welfare are the easiest to turn on for political reasons, so Obama is turning on them appearing like the populist he isn’t, while still taking their cash. This is truly fun to watch but is of little significance.
As long as the elite Democratic rulers are literally owned by these very special and influential interests, our economy will flounder and our freedoms will diminish.
FOLLOW UP: Media-Educators. At dinner tonight on this penultimate day of January Bill Collins suggested that Hollywood should have been included in the list of “owners.” Sure enough, common knowledge and a cursory internet search reminds us that Democrats dominate “Tinsel Town.” But this is just one segment of the media, the entertainment segment of the Fourth Estate, if you will. So, it seems incumbent to include the MSM (Main Stream Media) like MSNBC, CBS, ABC, CNN. It’s not too obvious that fawning lap dogs like Chris Matthews or Keith Olbermann are more than a bit biased. Stretching the “media” definition we can easily include the educational establishment. Hard to find a non-Obama hope-change professor on a college campus today. It would seem fair to say that the Media-Educators should indeed be included in the list of owners of Obama and the Democrats. Their influence aside from environmentalism would seem to be more social than economic. Things like “gay marriage” and “don’t ask, don’t tell” interest them. The cost here is to our intelligence and to the future of our society, thus our freedom. This is hard to measure in economic terms. But it is perhaps more critical to our democracy. The lack of education, intelligence in the electorate, and a free press willing to to its critical, investigative job will if continued doom our future.
Pray that the next generations are smarter than ours and will remedy this sorry state of affairs!
Tom Motherway