Archives for Diatribe

On February 13, the day his $787 billion Stimulus Plan passed Congress, President Obama praised the bill, saying, “Passing this plan is a critical step, but as important as it is, its only the beginning of what I think all of you understand is going to be a long and difficult process of turning our economy around.”

In such, the Obama Administration bought itself some time before judgment can be passed on its recent overt and unbridled actions.  Meanwhile the federal government, like a cancer, continues to creep throughout our society, with the President himself orchestrating this rapid cell division.  Eugene Robinson, liberal-apologist-posing-as-journalist, claims in his Washington Post article “The President of Everything,” that, “This is a presidency on steroids,” and, “All Barack Obama wanted was to be president.  He may have to become an auto executive, a banker, a mortgage broker and who knows what else before this crisis is done.”

What does America expect in this “new” era of hope and change?  Do we expect this Administration to overturn the previous era’s deficit spending with additional deficit spending?  Or did we expect his plethora of new websites (recovery.gov, change.gov, etc) to usher in social exhilaration, stoking the fires of this “new” economy?  How exactly does “change” happen?

Regardless of rhetoric, this “new” government will not be successful at creating a “new” economy; molding our private sector is up to the American people, and although the public-private merger may never be broken, government can do little to break the will of humanity.  Humanity has always, and will continue to, act in its own self interests.  This phenomenon has been elusive to the mathematical diagrams used to calculate economic growth, as free will is neither a constant nor a variable.

Frankly, I think government should mind its own dang business; its Constitutional purpose is not business, but governance, namely, the guarding of civil liberties.  We have moved way past that. 

This past week has made two truths quite apparent:  first, that Obama does not have a mandate, as he only garnered 56% support in the House, and 60% support in the Senate, for this Stimulus plan; and second, he could care less to gain bipartisan support anymore.  By all accounts, the three Republican Senators who voted in favor of the Stimulus were specifically targeted, or as the Politico put it, “wooed” by Rahm Emanuel.  The Left got their Bill, and at all costs.

Language of the Bill

Going beyond the fray of current political theater, though, what concerns me most are the longer lasting effects of our situation, possibly made worse by this bill.  Economic turmoil can breed civil unrest, and eventually, political upheaval.  Don’t blame me, I didn’t make the rules; open your eighth grade history book and read about it.  That’s asking a lot, though, considering the example our Congress set by not reading this 1100-page bill.  The President actually had possession of the bill before signing it for a longer period of time than Congress had to read it before voting on it.  So much for the “fierce urgency of now.”

That being the case, there are a couple of items slipped into this bill that may have been harder to detect with all the back-and-forth on tax cuts and pet project spending.  I found a couple of them interesting enough to point out here.

1.  Retroactive Social Justice

In what is called the ‘‘Cap Executive Officer Pay Act of 2009,” in Section 6012, there is a new limit on executive compensation, exceeding the scope of the President’s earlier mandate.  The bill reads, “Notwithstanding any other provision of law or agreement to the contrary, no person who is an officer, director, executive, or other employee of a financial institution or other entity that receives or has received funds under the Troubled Asset Relief Program (or ‘‘TARP’’), established under section 101 of the Emergency Economic Stabilization Act of 2008, may receive annual compensation in excess of the amount of compensation paid to the President of the United States.”

The bill actually goes back in time, to exact social justice on those who agreed to terms and conditions before them in the month of October, not a ruling that would come four months later in February.  Changing a contract after the fact is elementary-level Indian-giving from a body that, in fact, probably defined “Indian-giving.”  Although I may agree with the idea behind the act, we must tread lightly in our endeavors to persecute our aristocracy.  This is a slippery slope embarked on throughout modern world history:  the storming of the Bastille during the French Revolution in 1789; the Bolshevik Revolution in 1917; Cuba in 1959.  Pero cuidado, comrade.

2. Trade Wars (v. 2.0)

There is, in fact a “Buy American” clause in this Stimulus Bill; Section 1604 reads, “None of the funds appropriated or otherwise made available by this Act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron, steel, and manufactured goods used in the project are produced in the United States.”  There are additional guidelines for the clause, including quality and cost concerns, and the simple statement, “This section shall be applied in a manner consistent with United States obligations under international agreements.”

What does this mean?  Isn’t it good to buy American?  Well… yes, if it doesn’t incite a trade war, as was the case during a particular recession in 1929.  Then along came the Smoot-Hawley Tariff Act, that turned a recession into a Depression, and a Great one at that.  Are we so short-sighted to forget even recent history?  I personally believe the floaty bouyancy of “hope” and “change” may have slowly pulled us away from reason.  Consider the words of Supreme Court Justice Louis D. Brandeis:  “The greatest dangers to liberty lurk in insidious encroachment by men of zeal, well-meaning but without understanding.”  

3.  Increasing the Baseline

Last week the Wall Street Journal opined, “The bill will mark the largest single-year increase in domestic federal spending since World War II; it will send the budget deficit to heights not seen in 60 years; and it will establish a new and much higher spending baseline for years to come.  Combine this new spending, and the borrowing it will require, with the trillions of dollars still needed for the banking system, and we are about to test the outer limits of our national balance sheet.”

This Administration has, in fact, already increased discretionary spending  eighty percent for this fiscal year with this bill.  Consider federal funding for education:  this bill added another $100 billion to the more than $150 billion already given annually by Uncle Sam.  How about the $137 billion it allocates to health care, or the $92 billion to energy solutions?  Will government spending decline next year?  I personally don’t foresee it in the 111th Congress.

This is the beginning of an agenda I don’t believe ends too well.  When we trust government to supplement costs for housing (including home weatherization), car loans, health care, retirement, etc, we commit the fatal conceit, sacrificing our liberties to a governing body.  Who pays for these programs?  The short answer is our future generations.

The long answer?  According to the Tax Foundation, “Government spending targeted at the lowest-earning 60 percent of U.S. households is larger than what they paid in taxes in 2004.”  That means the top 40 percent are pulling a wagon that the other 60 percent are riding in.  That’s apartheid, and that was in 2004 during the Bush era, long before this bill committed $67 billion to unemployment benefits, welfare checks, and food stamp benefits.  Will Congress phase those appropriations out in the following years? 

Leadership Failure 

What we see is a populace voting for their self-interests; Congress is willing to promise Americans more than it can actually deliver, and everyone feels better instantaneously.  Nobody seems to have courage enough to tell the truth, even if it hurts.  So instead, pandering to a benign populace on a feel-good platform ensures reelection, regardless of the facts.  But there’s an old saying on Wall Street:  “Buy on rumor, sell on fact.”  The American people may ignore our fate’s unfolding, or the process therein, but they don’t ignore their own economic realities.  No amount of stimulus or government intervention can inject consumer confidence.  If you don’t believe me, look at how the Dow Jones sank 300 points today, reaching a three-month low, hours after the bill was signed into law.

This stimulus bill was a disastrous, tumultuous ride for anybody paying attention, but as Otto von Bismarck once quipped, “Laws are like sausages, it is better not to see them being made.”  Our dreamboat President warned us though:  this is only the beginning.  Remember, as you watch our government flail and twitch this way and that in the coming months, with claims that “only government can save our economy,” it cannot bend the will of humanity.

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I didn’t mean to depress all of you in my last post… ok, I admit it, I did intend to alarm you, to get your attention.  Now I feel like that guy at a party that said too much, and feels bad the morning after. 

So let me try to make it up to you.  Regardless of the outcome of the election this Tuesday, there are reasons to be happy!  I am not doling out therapy here, but instead pointing to the reasons we have to be optimistic while being alarmist.

I must admit, it appears Obama will win the election, and while I see John McCain as the last man standing in this epic wind of collectivist change sweeping across our country, I have to come to grips with the facts, and you do, too. 

While things suck, it’s not totally dark, and I mean that literally.  If you are reading this on a computer, I assume you also have electricity powering your lights and heat.  That’s a good thing!  There are countries that don’t have that luxury.  If you are an American, you live in the greatest country in the world.  As we face globalization for what it is, we will push our industry even further, to compete on a global level with other blossoming free countries.  We should welcome the competition, not dread it, as it will push us to create a greater quantity of better quality items.  We have done this before, and we can do it again.  Things are no longer so compartmentalized; energy, education, national security, the environment, and education are all correlated.  It’s time to address these issues, regardless of the buffoons who might oversee our government.

Fear Change?

The President, as designed, has little influence over your life.  Even though the National Journal rated Barack Obama as the most liberal member of the Senate in 2007, followed by Senators Sheldon Whitehouse (2) of Rhode Island, Joe Biden (3) of Delaware and also Obama’s VP pick, and Bernie Sanders (4) of Vermont, who is admittedly, not a Democrat, but a Democratic Socialist (Independent party), and even though it is true that John McCain voted with Bush 90% of the time while Barack Obama voted with Senate Majority Leader Harry Reid 100% of the time, and even though Obama has never opposed his party on major legislation, that doesn’t necessarily mean he will govern from the far left… ok, yes, it does, who are we kidding? 

The fact of the matter is, though, things are going to suck for a while, regardless of who the President is, and if they do, I’d rather the left get the blame for it.  We won’t become Obamistan overnight.  I know we can survive as a democratic and capitalist nation, because we are a nation of fighters.  Even though liberty ebbs now, the tide will come back in, with the help of patriots.

You have reasons to smile!

First, just to get this point out of the way:  with an Obama presidency, arguments for equality against racial prejudice will be put to rest.  We are at a pivotal point with regards to race relations, and it is indeed a great moment in our nation’s history.  If McCain were to win, though, we would hear about racism in America for his entire term as President.  He would go down in history as the spoiler to racial equality; if he lost, he would be remembered instead as the Greatest President We Never Had.

What excites me, though, is the fact that dissent is always strongest when it is in the minority.  Think about it.  It is now our duty, as Bill Buckley said, to “Stand athwart history, yelling, Stop!”  We are Americans, and we stand for freedom, regardless of which party will champion it.  Call your Congressmen and put up a fight.    The left protested the actions and decisions of this President for eight years.  Now, it’s our turn.

There are still reasons to fear, but the President has less to do with it than the rest of us do.  The Constitution can’t be repealed all at once, even if Obama wanted to “break free from the essential constraints that were placed by the founding fathers in the Constitution.”  His words, not mine.

We have the power to stop legislation through our objections.  Consider the fact that the Amnesty Bill actually crashed our Congress’s phone service due to the amount of incoming calls, or that the House of Representatives website crashed during the Bailout legislation due to overuse.  These actions had a direct effect on swaying legislation.

And here we go again.  Governors of states were on Capitol Hill asking for bailouts, with New York Governor David Paterson telling the House Ways and Means Committee yesterday, “We are cutting all we can.  Therefore, we feel that targeted, sensible actions by the federal government will provide relief for us now.”  New Jersey Governor Jon Corzine implored, “We need federal help to get through these tough times.”  Oddly enough, Corzine used to be our Treasury Secretary, and like our Treasury Secretary Henry Paulson, CEO of Goldman-Sachs.  I wonder where they got the idea that Big Government will help everybody out?  But I digress.

Listen how loudly South Carolina Governor Mark Sanford’s dissent rang before Congress, as his words gained national attention for the striking difference in tenor as compared to the Democrats, as he begged Congress NOT to bailout the states:

“I’d ask members of the committee to simply give the states more freedom.  Give us more flexibility.  Give us more in the way of control over the dollars we already have and less in the way of costs.  Give us more options, not more money with federal strings attached… The situation we’re now in did not develop overnight, and in the same way it won’t be cured by morning.  As the old saying goes, the first step to getting out of a hole is to quit digging… Our national debt is now over $10 trillion — more than $4 trillion higher than when I left Congress at the end of 2000… In fact, if this $150 billion stimulus package is passed, this year’s budget deficit could top $1 trillion — adding to the over $10 trillion national debt and making it 70% of a roughly $14 trillion economy…

Essentially, you’d be transferring taxpayer dollars out of the frying pan — the federal government — and into the fire — the states themselves.  I think this stimulus would exacerbate the clearly unsustainable spending trends of states, which has gone up 124% over the past 10 years vs. federal government spending growth of 83%. … There seems to be no consequence, and indeed a reward, for unsustainable spending growth by states.  In effect, sending $150 billion more to states would produce another layer of moral hazard — already laid bare at the corporate, individual and federal levels in recent years.”

So smile:  with patriots like these on the national stage, we won’t be marched into the gulag all at once.

I can only say this:  In the coming months, beware of legislation calling for equalization between individuals or industry by tinkering with the tax code.  If we don’t pay attention, it’s going to happen.  Liberals have been trying to achieve “economic and social justice,” to quote Obama, since the advent of our tax code.  I think unjust corporate taxation is a greater danger to America than an income tax hike is, although both are usually unjust.  We have to start thinking three-dimensionally about our tax system, remembering that we will experience diminishing returns due to over-taxation.

At this juncture, I’d like to make a point on the behalf of Wal-Mart, and corporations like them, such as Big Oil.  Sanctioning Wal-Mart for its innovation is simply un-American.  Wal-Mart’s annual profit is larger than the GDP of Saudi Arabia, and it employs more people than the American military.  Wal-Mart lowers the price of goods in an area by 5 to 8% (greater in rural areas).  Inhibiting growth is anti-capitalist.  I believe government’s role in regulating competition should be miniscule, and should only intervene to bust oppressive monopolies, which Wal-Mart and Big Oil are not.

Regardless of your concerns about Obama’s terrorist acquaintances, radical leftist leanings, inflammatory preachers (I said it), or Joe Biden’s predictions of an “international crisis,” or the Mayan prophecies, or end times analogies, or whatever’s got you scared, remember that America is resilient, and the President is constitutionally limited in the actions he can take against its citizens.  It’s not the end of the world, even if things are going to hurt for a bit.  We who stand for freedom will continue fighting for this country, and try to maintain an upwardly mobile trajectory, against all odds.  Americans love the challenge, and the coming challenge of our time is to keep government off our backs.  George Washington, the model for every Presidency since his, said, “Government is not reason, it is not eloquence, it is force; like fire, a troublesome servant and a fearful master.  Never for a moment should it be left to irresponsible action.”

So smile:  You are still an American!  Next up, your guide to Election Night.

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