Sunday, February 28, 2010

Eve Of (Financial) Destruction - The New Lyrics

A few weeks ago we had some fun comparing the extremely reckless deficit spending of the Obama administration to the 1960s Vietnam protest song from Barry McGuire "Eve Of Destruction." Our intent was to show that Obama was about to do what the Kaiser, Hitler Mussolini and Bin Laden had been able to do: topple the United States government, not through violence, but through reckless economic policies.

As a quick review, recall the following facts:
  • In its first year, the Obama administration overspent its revenue stream by $1.4 TRILLION, more than 60% more than it collected in taxes and other fees. The shortfall had to be financed by selling debt instruments to individuals and foreign national governments.
  • In the current year, it will overspent its revenue stream by about $1.5 TRILLION or 70% more than it took in.
  • The Obama administration is proposing that the national debt be increased by $8.5 TRILLION over the next decade. This increase would theoretically impose a deficit liability of over $65,000 on every American family. Additional taxes beyond the $65,000 would have to be paid by each family just to cover non-deficit government expenses.
  • Obama recently increased the United States government debt limit to over $14 TRILLION. Since the 400 wealthiest Americans are worth about $2.4 TRILLION, as estimated by Forbes magazine last summer, if the government confiscated the total wealth (not their income, their wealth) of these four hundred Americans, the rest of us would still have to pay over $11.6 TRILLION to pay off the nation's debt. On a per household basis, this debt obligation comes to about $90,000 per household. Of course, the government would never confiscate the total wealth of its richest citizens, at least I do not think they would, so the $90,000 obligation per household is a conservative estimate, it is likely much higher.
Very depressing information. Even more depressing is the fact that we are not even getting our money's worth for the high taxes and high deficit spending. Public schools are failing, the War on Drugs has been lost, Social Security and Medicare are heading for insolvency, there is no national energy strategy, highway infrastructures are falling apart, etc. Plus, our freedoms continue to erode as the deficits pile up, with more and more of the freedom and wealth sent to Washington and outside forces, e.g. the Chinese, exerting more and more influence, further restricting our freedom as individuals and as a nation.

Below are the reworked lyrics to Barry McGuire's "Eve Of Destruction" (the original lyrics are listed further below), updated to represent the horrible financial jam the Washington political class has gotten us into. At least we can have a sense of humor about where we are economically and realize that Mr. McGuire was correct back int he 1960s, he just got the cause wrong:

The financial world it is imploding
Debt is rising, banks are folding
The deficit spending, it is out of control
Americans are ticked, just ask any poll
Even the Potomac River has red ink flowing.

Let me tell you over and over and over again, my friend
Financially, we’re on the eve of destruction.

Billions and billions are wasted each day
Our debt is many trillions, what can I say
If the spending keeps going, we’re all going to pay
Even your grandkids will owe when you’re in your grave
Look at our deficit, boy it’s bound to scare your, boy.

Let me tell you over and over and over again, my friend
Financially, we’re on the eve of destruction.

My wallet’s so thin, it gets so frustrating
GM and Chrysler, you all know the truth, economy’s stagnating
Bickering Senators don’t pass legislation
No politicians are cause for celebration
Their voices and shrill are all so nerve grating
Citi Bank, pork, earmarks are all so degrading.

Let me tell you over and over and over again, my friend
Financially, we’re on the eve of destruction.

Think of all our debt that is now owned by China
They could buy, sell and trade all of California
Obama and Bush, both so much to blame
They seem to think this all just a game
Rich versus poor, it’s all starting to foment
All pols are all to blame for this predicament
I still love my country but loathe its government.

Let me tell you over and over and over again, my friend
Financially, we’re on the eve of destruction.

The Original Lyrics:

The eastern world it is exploding’
Violence flarin‘, bullets loadin
You’re old enough to kill but not for voting’
You don’t believe in war, what’s that gun you’re totin‘?
And even the Jordan River has bodies floatin’.
But you tell me over and over and over again my friend
Ah, you don’t believe we’re on the eve of destruction.

Don’t you understand, what I’m trying to say?
Can’t you see the fear that I’m feeling today?
If the button is pushed, there’s no running away
There’ll be no one to save you with the world in a grave
Take a look around you, boy, it’s bound to scare you, boy.

But you tell me over and over and over again my friend
Ah, you don’t believe we’re on the eve of destruction.

Yeah, my blood’s so mad, feels like coagulation
I’m sitting here, just contemplatin’I can’t twist the truth, it know no regulation
Handful of Senators don’t pass legislation
And marches alone don’t bring integration
When human respect is disintegratin
This whole crazy world is just too frustratin’.

And you tell me over and over and over again my friend
Ah, you don’t believe we’re on the eve of destruction.

Thing of all the hate there is in Red China
Then take a look around at Selma, Alabama
Ah, you may leave here for four days in space
But when you return it’s the same old place
The poundin’ of the drums, the pride and disgrace
You can bury your dead, but don’t leave a trace
Hate your next door neighbor but don’t forget to say grace.

And let me tell you over and over and over again my friend
Ah, you don’t believe you’re on the eve of destruction.

Our New book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at It is also available online at Amazon and Barnes and Noble.

Saturday, February 27, 2010

The Leadership Void In Washington Continues to Grow

The concept of leadership has many facets and can manifest itself in many different ways to different people. To some people, leadership is taking responsibility for results, even if the leader was not the direct cause of those results. To others, leadership is maintaining a strong sense of positive principals and acting consistently even when those acts might be distasteful. Leadership might be the ability to get people unified behind a common cause to act against their best interests in the interest of the greater good. Leadership might look like confidence and humility co-existing together rather than self worth and ego running the show.

I thought about different forms of leadership lately as I watch the political class continue to fumble away at their jobs in Washington D.C. The latest example of the leadership void arose this past week when a Congressional ethics panel formally admonished New York Congressman Charles Rangel for accepting a corporate sponsored trip to the Caribbean. The panel had proof that his staff had warned him on at least three occasions that taking the trip would be a violation of Congressional gift rules. However, the Congressman took the trip anyway and does not deny taking the trip.

Rather than step up and take responsibility for this violation, what does the Congressman do? He blames his staff for not informing him of the violation. Remember, this is a Congressman that has been in office for about forty years, I seriously doubt that he did not know that a trip to the Caribbean might violate some sort of House rules on gifts. He should have had the wherewithal to check and make the trip was legitimate even if his staff did not inform him, which they apparently did at least three times. Rather than be a leader, he threw his staff under the bus and denied any responsibility for results.

This incident takes us to the second aspect of leadership discussed above, maintaining a strong set of positive principals and acting consistently even when those acts might be distasteful. What did Speaker of the House Nancy Pelosi do when the organization she "leads", the House of Representatives, formally admonishes a member like Rangel? Doe she take any punitive action even though it would harm a member of her own party? No, she does absolutely nothing, saying that "we'll just see what happens next." Why wait? The ethics panel has spoken, the panel that Pelosi ultimately has responsibility for. When Republican Joe Wilson publicly called Obama a liar in public last year during a Presidential speech, Pelosi made sure a formal censure measure of Wilson was immediately passed by the House, despite the fact that Wilson immediately and personally apologized to the President and the President accepted the apology. The inconsistency of behavior proves that Pelosi is not the leader she thinks she may be despite the fact that she promised to "drain the swamp" of ethics abuses back in 2006. By the way, Rangel is still facing a whole host of other potential ethics violations. If guilty, it should be interesting to see if Pelosi steps up to her leadership role and drains the swamp of Charles Rangel.

Speaking of taking responsibility, Obama has got be the king of not taking responsibility. For the entire first thirteen months of his administration, nothing that has gone wrong has been his fault. Unemployment rising faster and faster with no end in sight? The fault of the Bush administration even though Bush has been out of office for over a year and the Democrats have controlled Congress for over three years.. Federal budget deficit skyrocketing? The fault of the Bush administration even though the Bush administration has been out of office for over a year and the Democrats have controlled Congress for over three years. Banks got too much money in taxpayer bailout funds? The fault of the Bush administration even though the Bush administration has been out of office for over a year, Obama the Senator voted to pass the bailout funding, Congress has been controlled by the Democrats for over three years and Bush tried to prevent the housing meltdown dozens of times but was blocked from doing so by the Democrats. Washington gets a record breaking snowfall? The fault of the Bush administration even.... Just kidding on the last point but you get the point. A true leader steps up and takes responsibility for both good news and bad. This President's lack of humility does not allow him to perform in that manner, his ego will not allow it.

The leadership ability to get people unified behind a common cause requires a standard of respect for differing opinions, something that has been severely lacking in Washington these past years. In just the past thirteen months, those that have disagreed with Obama's policies have been called racists, knuckle dragging Neanderthals, a%$holes, un-American and a few other names. What has Obama done to squelch the divisive name calling and work towards unifying the country? He has been silent in every case, allowing the name calling to escalate and further divide the country.

A great leader unifies the people for the greater good, bad leaders divide the country for no one's good. Whether it is ignoring ethics violations, blaming others for their own shortcomings, forcing distasteful and ill conceived programs onto people, calling people names, etc., we are faced with a tremendous leadership void in this country and it is slowly ripping the fabric of freedom and community apart. Please visit "Love My Country, Loathe My Government," specifically pages xxii and xxiii, to see how the Freedom Pyramid theory can restore both individual freedom and leadership to the country today.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Thursday, February 25, 2010

More Political Class Insanity - California Style

Yesterday I thought we had caught up on all of the recent national and international political class insanity. However, I log on this morning and another great example of political class insanity and waste is staring me in the face, this one concerning the state legislature in California. Before we go to the insanity itself, let's review the financial and economic state of California today, according to a Reuters report and a few other news websites that I came across in less than five minutes of searching online:
  • According to Reuters, California currently has about a $2o billion budget shortfall.
  • This shortfall occurred despite billions of dollars in budget cuts in 2009.
  • Unemployment in the state is over 12% compared to national unemployment rate of less than 10%.
  • State employees are given unpaid furlough days every month to reduce state salary expenses.
  • in 2009, the state treasury could not pay bills for a short period of time and had to issue IOUs because the state government did not have enough funds to cover the expenses.
  • It takes a two thirds majority to pass a budget in the state so fundamental economic/financial reform reform has been difficult, requiring short term and one time budget tricks to balance the recent budgets.
  • The state credit worthiness ratings of its bonds was downgraded in 2009, resulting in higher borrowing costs, deepening the current budget shortfall.
  • To make up for their state reduction in support of public college education, college costs at the state universities were raised over 30%.
Pretty serious stuff affecting every single California resident and taxpayer. One would assume that the state level political class would be focused on cleaning up this mess and getting the California state financial house in order. However, that may not be the case, according to an Associated Press report today. Rather than focusing on budget matters, the state Assembly is scheduled to take up and vote on a resolution calling for a state wide "Cuss Free Week."

Stop and think about this one for a little while. This resolution would officially designate the first week of March, every year, as Cuss Free Week. If the Assembly passes it today, the measure would go to the California state Senate for a vote next week. Thus, if both the state Assembly and Senate are addressing this non-issue, you can safely assume that hundreds, if not thousands, of man hours have been spend by both the politicians and their staffs on this effort. These are valuable hours that might have been better spent working on the massive budget issues instead.

And it gets even better. Its not like this is a big problem in the state legislature. The AP article explains that "cussing" is very rare on the floor of the Assembly and Senate and that politicians try to "maintain a sense of decorum even if they engage in heated arguments over legislation." In 2007, a lawmaker used the word "hell" in the Senate, after which Senators took time out to discuss whether that word was appropriate for use on the Senate floor.

Thus, not only is this a waste of time and a stupid idea, deflecting focus away from real problems, it is NOT EVEN A PROBLEM in the legislature. Nobody is dropping f-bombs during debate or profanely ripping other lawmakers. It does not get any worse than solving a non-problem with a inane idea while the financial foundations of your government are collapsing. It is behavior like this that cries out for term limits for the political class, as outlined in Step 39 in "Love My Country, Loathe My Government" and also for accountability and removal of politicians from committees and subcommittees that work on such stupid ideas (Step 34).

Remember, you can end a lot of this insanity by removing all incumbents for office by voting against their re-election in November.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Wednesday, February 24, 2010

More Political Class Insanity - February Version

As I have said many times, I will never run out of materials for this blog since the political class constantly brings me new material of just insane stuff that they do and say. Never mind that we have lost the war on drugs, our public schools are failing, our deficit and national debt is skyrocketing, unemployment is very high, government agencies and organizations that are supposed to protect us (SEC, FDA, FTC, the Senate, the House Of Representatives, etc.) do not protect us, we have no national energy policy, etc.

Rather than work on these issues, the political class has brought us so many funny, expensive, and useless ideas over the past year or so. A Congresswoman and her staff waste resources writing legislation to regulate the sound volume of television commericals. Another Congressman and his staff waste resources writing legislation to eliminate erectile dysfunctional commercials from television broadcasts. Half of the money spent on bridge repairs from the stimulus program was used to fix bridges that were not broken. The list goes on and on.

Today I received my monthly issue of Reason magazine which is usually chock full of these types of politician behavior. So let's add to our list of funny, expensive, and useless ideas from politicians the world over:
  • Police arrested a 14 year old boy at a California middle school after he threw a football at another boy's leg during a football game. The other boy was not hurt. The police report said that the boy who threw the ball seemed to be angry but did not specify why he was arrested. Forget the drug dealers and speeders, let's put police on middle school fields in case someone gets angry.
  • In Britain, the Office of Standards in Education, Children's Services, and Skills wants to force parents to undergo a criminal background check for those parents "who wish to home school their children." Sounds like a good idea, who wants a criminal teaching your kids, even if it is you! Critics view it as a way to find out what home schoolers are learning and to control what they learn.
  • Also in England, when a group of Lancashire kids threw rocks at a local home, the 71 year old homeowner came out and she poked one of the 17 year old boy rock thrower. The homeowner was arrested for assault.
  • A legally elected, non-scandal plagued member of the Ashville, North Carolina city council is under pressure to resign or be removed from office. His sin? He is an atheist and the North Carolina state constitution requires that all elected officials must believe in the being of an almighty God.
  • Technology restrictions used to make it illegal to use your cell phone during many parts of an airplane's flight for fear that its usage might interfere with the plane's electronics. However, newer phones no longer pose that problem. Thus, passengers should now be able to use their cell phones during all parts of the flight without endangering anyone. However, an Oregon Congressman and his staff are busy drafting legislation that would still prohibit the use of cell phones. According to the Congressman, "Cell phone users should not be able to disrupt the comfort of an entire airplane cabin especially when other passengers have not choice but to listen." What's next, Congressman, do you want us to sit boy-girl-boy-girl on the plane? Stop treating us like children. Many people sleep on the plane, many people listen to their iPods, many people listen to the movie, and others probably do not want to talk on the phone and let the whole plane know their personal business. So what's the problem?
  • Late last year, the Texas state PTA distributed a message about a type of crystal meth that was circulating that looks like strawberry pop rocks and smells like strawberry. The message warned parents to be on the look out for this new type of drug that according to the PTA, was being handed out on the playgrounds of the state. Furthermore, according to the communication, children were ingesting the strawberry flavored drug and were being rushed to the hospital. This situation is so bad that the U.S. Senate got involved and wrote legislation called the "Saving Kids From Dangerous Drugs Act," which would double the penalties for creating and distributing illegal drugs that are flavored or marketed to kids. Whew, that was close. Thank goodness the U.S. Senate got out in front of this problem. In fact, they got so far out in front because the problem does not exist. According to the DEA, the reputable rumor tracking website, the drug policy organization Join Together, and an addiction expert, there is no such product or epidemic anywhere in the country. Everyone, from the Texas PTA and the U.S. Senate reacted to absolutely nothing. Fortunately, the Senate can now get back to that pesky sound volume of TV commercials issue.
  • Taxi cab drivers in Alexandria, Virgina are required by law to take at least two calls from their dispatcher everyday. The original aim of this rule was to force taxi cab drivers to not hang around hotels and airports, looking to get the more lucrative fares and ignore other, less lucrative fares. Unfortunately, the rule has directly resulted in at least one cab company going bankrupt and another is on probation for not meeting the rule's requirements. Sounds like such a good idea when the unemployment rate is so high, let's shut down perfectly good companies and businesses for not following the stupid rule of some bureaucrat.
The following pieces of political insanity were from the February 26, 2010 issue of The Week magazine:
  • The Transportation Security Administration (TSA), those folks at the airport who do security checks, have apologized because they forced a disabled boy to remove his leg braces to pass through a metal detector. This despite the fact that his son could barely walk. Never mind that the TSA and the rest of the government security apparatus did not stop the underwear bomber until his bomb misfired, despite knowing someone like him from Nigeria was coming into the country on that day and having been warned by the would-be bomber's father that his son was a possible terrorist. We at least have the disabled four year old American boy terrorist cell covered.
  • The state of Virginia legislation voted to make it illegal to implant microchips in people without their permission. The Georgia Senate also passed the same type of ban. Again, unemployment is at an all time high and these folks are worried about forcible microchip implants. Maybe the current assault laws on the books would cover such activities, i.e. forcibly placing microchips inside a person without that person being aware of the implant. Is this a large problem in Virginia and Georgia? I was not aware of this plague on our citizens.

Funny but so sad. The country is in such bad shape and time, energy, and resources are wasted on non-existent drug threats, microchip implants, and the like. The opportunity to dump every incumbent running for re-election in November cannot come soon enough.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Tuesday, February 23, 2010

Faulty Acceleration Problems - Who Is To Blame: Toyota, NHTSA Or Congress?

As most of you probably know by now, Toyota is in the middle of a massive recall of its autos around the world to fix faulty break and unexpected acceleration problems on all of its brands (Scion, Toyota, Lexus). There is really no doubt that a problem exists since even Toyota executives have admitted to a problem (plus the fact that they are fixing an untold number of cars for no cost to the owner kind of settles the point that something is wrong.) At a Congressional hearing today, a Lexus owner told about her harrowing experience when her Lexus accelerated to almost 100 MPH and for several minutes she could not slow down or stop the car. Somehow she eventually regained control before a crash and serious injury occurred. Something is definitely wrong.

So at least Toyota is to blame for the problems? But does the blame stop there? Consider some information from an article in the March 1, 2010 issue of Business Week concerning problems with Toyota vehicles:
  • In 2004, the National Highway Traffic Safety Adinstration (NHTSA) opened an investigation into complaints that 2002 and 2003 Toyotas had unanticipated acceleration problems. Some of these complaints arose as a result of crashes due to acceleration problems. The investigation was started in March but closed by July with no action taken.
  • In late 2005, more complaints of unintended acceleration problems caused another NHTSA investigation to be opened. It was shut down just a few months later in January, 2006 with no action taken.
  • In August, 2006, another investigation was started when more complaints were received about Toyotas from the 2002 through 2006 model years having acceleration problems. That investigation ended in April, 2007 with no action taken.
  • In 2008, still another NHTSA investigation was opened when there were over 475 complaints of Toyota Tacoma pick up trucks having acceleration problems. Eight months later the investigation was closed down with no action taken.

A few observations:

  • Since everyone today, including Toyota executives admit there is a problem, how come the NHTSA launched eight (the four listed above and four others not listed) formal investigations in just an eight year span and came up with nothing?
  • The problems appear to have covered at least eight model years, various car models and the Tacoma truck. Did not anyone at NHTSA think there might be a systemic trend here, multiple years, multiple models, same company?
  • The Business Week article listed in detail the four formal investigations above since they were each handled on the Toyota side by by two Toyota executives that used to work at the NHTSA and who look to have been the main interface between Toyota and the NHTSA investigators. According to a quote in the article by Joan Claybrook, an auto safety advocate and former NHTSA administrator, "Toyota bamboozled NHTSA or NHTSA was bamboozled by itself. I think there is going to be a lot of heat on NHTSA over this." The "this" she refers to is the possibility that Toyota got the kid gloves treatment because of the past connections and possible influence that the two ex-NHTSA Toyota executives handling the investigations had with friends still at the NHTSA. Can you say conflict of interest?

In any case, it is apparent, at least to me, that the NHTSA is also very much at fault in addition to Toyota. They had hundreds of cases of faulty acceleration problems at their disposal, they opened up eight investigations but found not problems and took no actions, and they may have listened to ex-NHTSA employees who wrote reports to the NHTSA stating nothing was wrong ("No evidence of a system or component failure was found and the vehicles were operating as designed." Quote from Toyota in 2005) The agency is at the very least mismanaged, incompetent, or too industry friendly.

Behavior like this in the real world, outside of government, would get people fired from their jobs. There have been no reports that anyone from NHTSA has been fired for completely missing this albatross. This is the quality we get for paying our tax dollars.

And finally, may favorite party in many of these escapades, Congress and the political class. As mentioned in "Love My Country, Loathe My Government," have you noticed how in just about every pick screw up involving the government (in this case the NHTSA), Congress only gets involved after the disaster happens:

  • Congress holds hearings on FEMA incompetence AFTER Hurricane Katrina devastates New Orleans. New Orleans is still a wreck in many respects.
  • Congress holds hearings AFTER the subprime mortgage meltdown. Too little, way too late to do anything.
  • Congress holds hearings AFTER Bernie Madoff rips off investors for billions of dollars. Too little, way too late to do anything.
  • Congress holds hearings AFTER it is found that military hospitals handling Iraq war wounded are a disgrace. The biggest military hospital, Walter Reed, is less than ten miles from the Capital Building but no politician bothers to take a visit to see how things are going.
  • Congress holds hearings AFTER the 9-11 attacks. They cannot address the problem and require an outside commission to come up with security recommendations.
  • Congress holds hearings AFTER it is found that toys from China may have been produced using lead paints which is a dangerous toxin if American kids put the toys in their mouth. A year later, although the lead has been largely removed from imported toys, overseas toy makers are now using cadmium instead of lead in their production processes, an element that is just as dangerous (see a previous post for details found in an Associated Press report on cadmium laced toys).
  • Congress holds hearings AFTER eight years of reported acceleration problems with multiple Toyota models over multiple model years.

Its only AFTER a crisis that the political class wakes up and starts posturing (but hardly doing anything effective) even though the problem has smacked them in the face. Rarely are they proactive in avoiding any disasters. Thus, Step 34 from "Love My Country, Loathe My Government" becomes critical in the future if we are to avoid future disasters of any kind:

Hold Congress and Senate committees and subcommittees accountable for their respective areas of responsibility, and remove committee members from committee posts if they do not meet minimal performance criteria.

If any politician sitting on the committees that are now investigating the Toyota problems have been sitting on those committees for any amount of time, they should all be removed since they, along with the NHTSA, were not competent enough to not see the acceleration problems over the PAST EIGHT YEARS. Thus, they should be relieved of their committee posts and replaced with others that may be more diligent in their responsibilities. There must be accountability at the Congressional level also, that is what we pay our taxes for, competence. Anything short of that is unacceptable and should have consequences.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Monday, February 22, 2010

I Am Going To Hold My Filibuster Breath Until I Get My Way

Try to guess which members of the political class made the following quotes:
  1. "There was a consensus decision on behalf of the leadership, unfortunately, of the Democratic Party in the last Congress to systematically filibuster some of the best {judicial} nominees ever submitted to the Senate." Source:
  2. "The Republican Party cannot acquiesce to philosophy that says Democratic Presidents can get their judges confirmed with 50 votes." Source: The Week magazine, February 26, 2010
  3. "I have never seen the Constitution stood on its head as they've done. This is the first time every single solitary decision has required 60 Senators." Source: The Week magazine, February 26, 2010
  4. "At its core, the filibuster is not about stopping a bill, its about compromise and moderation." Source: The Week Magazine, February 26, 2010

Give up? The first two, conflicting quotes were from the same person, Alabama Senator Sessions who on the one hand resented the filibuster process when the Republicans controlled the Senate (first quote above) and then loved the filibuster process when the Democrats controlled the Senate (second quote above). Not to be outdone, Vice President Biden did the same flip flop. In the third quote above he hated the filibuster process earlier in 2009 when the Democrats controlled the Senate but thought it was a good idea a few years ago (fourth quote) when the Republicans controlled the Senate.

Maybe why this is why nothing ever gets done in Washington, values and positions change depending on which way the political winds are blowing. And maybe this is why America is so fed up with its politicians. All they worry about is how they can make the best of a situation, regardless if they have to compromise their values and previous positions, and not worry about what is best for the country. You cannot think a filibuster is bad for judicial nominees in 2005 and but a good thing in 2010 when the only thing that has changed is who controls the senate as Sessions did. You cannot think that filibusters damage the Constitution when you are in power but it was a good way to get moderation and compromise a few years ago as Biden states.

How stupid do they think we are, we can all see hypocrisy when it is right in front of us, along with the fact that this hypocrisy has gotten the country in the deep rut and divisions we face today. They are no better than a four year hold child that promises to hold his breath until he gets what he wants, even if it upsets everyone else in the room. And four year olds do not make good leaders.

And it is not just me who feels this way. Consider some of the quotes from the March 1, 2010 issue of Business Week which contained an interview of retiring Indiana Senator Evan Bayh:

  • "The level of polarization and gridlock right now is much higher than I have ever seen it before."
  • "That kind of culture makes it much harder to sit down and forge consensus when you know the folks on the other side of the aisle are trying to get you."
  • "And if all things political are constantly at the forefront of your mind, just makes consensus more difficult to achieve."

To the Senator's credit, he at least recognized the insanity that is our political situation. It appears to me that the majority of the sitting politicians such as Biden and Sessions are caught up in Big Brother speak, where "War is peace, freedom is slavery, ignorance is strength" to which we can now add "Filibustering is good or bad depending on who is in the majority." Pathetic.

Several steps from "Love My Country, Loathe My Government" would address this type of behavior in Washington where values change depending on whether that change is advantageous at the moment:

  • Step 39 - Establish term limits for politicians. Many experts, along with retiring Senator Bayh, have observed that once elected to office, the first and most overriding concern of every politician is to get re-elected. Thus, no politician wants to look weak and compromising, even if that is in the best interests of the country, in order to maximize their chance for re-election. By eliminating the option of re-election, maybe politicians would focus on what is best for the country and not what is best for their next term in office.
  • Step 14 - stop reconfiguring Congressional districts to almost guarantee re-election of incumbents. One theory that explains the non-compromising nature of Congress is that the political class has constructed convoluted Congressional districts that focus polar opinions into each district. Those that want to get elected in those polarized districts have to look strong and uncompromising relative to these extreme viewpoints, leaving little room for compromise towards the center of an issue.
  • Step 38 - require all political members in office to sign off on a shared values statement each year, one that requires each signer to adhere to the suggested principals of integrity, honest, commitment, teamwork, and trust and possibly a few other noble traits. Maybe if they put their name to a set of values they would actually live up to these values rather than the hypocrisies we have today.
Prior to implementing these three steps, there is something we can all do in November. Namely, we need to vote out these hypocrites that have not gotten anything done to the benefit of the country for the past forty years and replace them with new people with new ideas and no baggage from the past so that we do not have to live through the lies like those laid out in the four quotes above.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Saturday, February 20, 2010

Going Nuclear And Wasting More Taxpayer Money

Anyone who loves freedom and desires a much smaller, less intrusive and less expensive government, has not had a good year or so. The political class, under both Bush and Obama, have made a sham out of our economy and our free market system. Someone once said that: "Capitalism without the threat of bankruptcy and ruin is like Christianity without the threat of Hell." However, that is not what we have in America today. Tens of billions of taxpayer dollars were spent on the bailouts of Chrysler and GM even though it was the mismanagement of those companies that caused them to fall into financial ruins. Major banks took wild, high risk actions on loans that were highly questionable only to have the Federal government bail them out. Insurer AIG has already sucked up almost $200 billion of taxpayer money and was likely used as a funnel for taxpayer money to the big banks balance sheets for their non-due diligence in insuring risky real estate loans. The Federal government had to bail itself out because of its mismanagement of Fannie Mae and Freddie Mac, again wasting billions of taxpayer dollars.

The one thing that all of these entities had in common, the car companies, the banks, the insurance companies, and the government housing entities, was that they took unnecessary risks and made very poor decisions but did not go to business/financial hell, they simply got taxpayers to foot the bill. And we are about to do the same thing again. According to an Associated Press report from February 12, 2010, President Obama will soon announce that the Federal government, using taxpayer money, will provide $54.5 billion in loan guarantees to companies that will build the next set of nuclear energy plants in the country. This amount of money is enough to build about 6-7 new plants and serve 1.4 million people. It should also support full time jobs for 850 people and employ 3,000 construction workers.

Supporters of the loan guarantee state that without the government backing the construction of new nuclear plants, nothing will get done because of the high upfront costs. Critics of the plan state that it is nothing more than another government subsidy of a private industry and that given the history of cost and schedule overruns in the industry, the $54.5 billion price tag might be too low. Some environmentalists also oppose the plan since new nuclear plants will result in additional dangerous nuclear waste, for which the government does not have a plan for safe storage and removal.

The fact that the plants will not get built without a Federal guarantee of loans, as the supporters of Obama's plan claim, should tell you something from a free market perspective. If no one in the private sector is willing to put down the capital and effort to build a new nuclear plant because of the high risks, why do we think it is such a great idea for the Federal government to support and guarantee it with taxpayer money? The economics are still the same and if private industry does not like the economics, it certainly will not be better economics if the Federal government is involved. It sounds a lot like the past year's bailouts, "don't worry, if you fail, we will keep you whole with free taxpayer money." Remember, capitalism without the threat of bankruptcy is like Christianity without the threat of hell.

Plus, is this really the right way to go from an energy strategy perspective? Let's do some math:
  • The Federal government will be on the hook for $54.5 billion which comes out to a per household cost of about $420. Thus, is it a good deal for those millions of households that will not be served by these 6-7 new nuclear plants to put up this amount of their money to subsidize the energy costs for 1.4 million?
  • According to the U.S. census organization, the average U.S. household consists of 2.61 people so that the 1.4 million people that will be served by these new plants will live in only 537,000 homes. Thus, 130 million U.S. households will be theoretically paying $420 each to subsidize 537,000 households, which represents only .4% of all households.
  • As with all government programs, the economic positives, i.e. more jobs, will be focused around the sites of the new nuclear plants. Thus, 6-7 local areas will see new jobs at the expense of the rest of the country.
  • And worse of all does, this make any sense relative to other energy formats? According to an online PBS article associated with its Nova television show, a complete solar energy retrofit they did to a house in southern California cost about $61,500. This retrofit made the house completely solar powered and actually returned excess electrical energy generated by the retrofit into the utility's power grid. Now if we assume that this real life example is a good estimate of the cost to solar retrofit a typical American home, then that $54.5 billion loan guarantee would be able to make about 866,000 U.S. homes cleanly energy independent, 65% more than the number of homes served by the 6-7 new nuclear plants. Seems like a better deal to me.
There a number of additional advantages of using that money for solar retrofits than trying to build highly complex, dangerous nuclear power plants:
  1. First, you can effect more homes than the nuclear approach making any use of taxpayer money more efficient.
  2. Second, you do not have that pesky increase in dangerous radioactive waste that you would have the nuclear power plants.
  3. Third, you would still have a lot of jobs created, countering the jobs needed to run and build the nuclear plants, but those solar manufacturing and installation jobs would be more fairly spread around the country and not focused just around those 6-7 plants.
  4. Fourth, the costs used in the above calculation was for one retrofit. However, if it became worthwhile to do thousands of retrofits, the cost of materials and installation would likely fall dramatically, allowing for more retrofits.
  5. Fifth, what if the $54.5 billion was used to only pay for half the cost of the retrofits and the homeowner was required to put some equity into the retrofit? If so, then the number of clean, solar retrofitted homes could be as high as 1.7 million households, much more than the 536,000 homes served by the nuclear plants.
  6. Fifth, if the taxpayer was going to foot the bill for these retrofits, the costs would be spread out over years and would be incurred as the work was done, it would not be risked in an all or nothing up front bet like the back the nuclear plants. If households wanted to retrofit their house for solar, than part of that $54.5 billion could be used to pay for the retrofit. Money paid when the costs were incurred as opposed to money paid to the nuclear power plant builders, in the form of loan guarantees, before any costs were incurred.
  7. The impact on the nation's energy situation could be almost immediate as home owners started their retrofits with today's technology while it would likely take many years before these nuclear plants are up and running.
As with most government programs, I always wonder if anyone in the political class does the simple math to figure out what the true picture of spending taxpayer money is. (Remember our calculation the other day showing that the Obama stimulus plan cost the country about a quarter of a million dollars to create one job). Same thing here, why risk billions of dollars for an enivornmentally risky solution when some simple math would show a far better, quicker and fairer solution exists? It all comes down to the political class not knowing how to solve any problems. Thus, that is why Step 23 in "Love My Country, Loathe My Government" is so important. Step 23 would put together a panel of smart American experts (akin to historical panels that actually got something done in Washington including the Manhattan Project, the Apollo space mission, the Grace Commission on government, the military base closing commission, etc.) to develop and implement a comprehensive energy strategy for the country, i.e. do the math and analysis.

The political class has been looking at the energy situation in this country since the oil embargoes of the 1970s and has accomplished nothing. Throwing tens of billions of dollars at nuclear power plant construction companies accomplishes nothing without the context of an overall energy strategy and understanding the trade offs between all types of factors. Step 23 would accomplish that feat and if done right, would solve the problem and not waste the taxpayer money doing so.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Friday, February 19, 2010

George Orwell and A Pennsylvania High School

Most people are familiar with the George Orwell classic, "1984." Written in England in 1948, it hypothesizes about a future where freedom and liberty have disappeared and are replaced by an all powerful and all knowing police state form of a government. In his future, Orwell sees government snooping devices everywhere, even out in the middle of the woods.

Orwell's view of the future seemed appropriate for America after I read a disturbing article from the Associated Press (AP) today. Apparently, a highly rated Philadelphia suburban high school issues laptops to all students but the school administration has the appropriate hardware and software installed on those laptops so that school personnel can activate the web cameras on the computers and access them remotely. In other words, if a student left their laptop on in their bedroom, which, according to the article is where they tend to be used the most, school personnel could view the contents and activities within the bedroom that fell within the view of the laptop's web camera.

How did families find out that the government run schools had unauthorized video viewing access to their home? Two ways. First, an assistant principal actually told a student that school officials believed he had engaged in improper activity in his own home and to prove their point, provided a photograph of that activity from the student's laptop computer. Second, the school district acknowledged that they had indeed deactivated the feature which they deemed as a security feature to track lost and stolen laptops.

A whole list of issues and questions come to mind with this atrocity:
  • If the feature was to only track lost and stolen laptops, why was the feature activated and being viewed of a student whose laptop had not been reported lost or stolen?
  • You would expect an assistant principal to be an educated, relatively smart person. Why in the world would the principal tell the student they were spying on him and create the hardcopy photograph to prove it?
  • How many other student's were spied upon outside of school grounds and what records were made of those spying events?
  • Who had access to this feature and can its usage be tracked to see who was viewing who and when it was done?
  • You would think someone in the school hierarchy would have either been smart enough or knew enough about the Constitution and privacy laws to stop the program and feature. What does that say about the people in charge of educating the nation's kids?
  • However, the biggest question is if a high school was able to do this, can you imagine what the NSA, CIA, FBI, telephone companies, cable companies, and other government entities might be doing to us now?
Think about it from Orwell's perspective in light of just this high school capability. With GPS enabled cell phones and laptops, somebody, somewhere could probably track your movements pretty easily. Since almost the beginning of time, phone companies could tap your phones and now cable companies could be tracking what you watch and when you watch it. Email has to go through a computer that could easily make a copy without you knowing it. Right now as I type on my laptop, somebody could be looking in at me typing away through my own web cam. Who is to say that a future cable box will not contain a tiny camera that could broadcast out my living room activity or worse yet, be hooked up to my bedroom TV. Many cell phones today can record video, who is to say that now or sometime in the future someone could remotely turn on that video function and have what it sees broadcast back? As we get more and more wired, the potential for Orwell's world to come true becomes more and more possible in ways we never imagined.

Think about it: before this high school scandal, did you ever think that the web cam lens looking you in the eye could be used for eyeballing you? Remember the old saying, "just because I'm paranoid does not mean they are not looking at me."

The bigger question, of course, is not a high school administration spying on us but the government spying on us. Thus, three steps from "Love My Country, Loathe My Government" become very important from a liberty perspective:
  • Step 20 - Determine the effectiveness of each part of the Patriot Act. An independent panel will conduct a comprehensive review , then propose whatever changes to the act that it deems necessary to balance security with freedom. A national referendum will vote on the proposed changes.
  • Step 21 - Make it illegal to tap the phones, intercept the mail, monitor Internet activity or examine the phone or library records of any American without a warrant that shows probable cause.
  • Step 22 - Require that the government at the end of any phone tapping activities, mail interception, etc. tell a vindicated American citizen what information the government collected and why.
Government and the political class have gotten way too big, petty, and powerful to assume that they are there to protect and serve us unless the above three steps are strictly enforced. In the meantime, I suggest that all high school administrators take a refresher cause in privacy laws and the U.S. Constitution. Certainly they do not want to find out the hard way like this Philadelphia area school which is being sued for the intrusion into students' homes

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Thursday, February 18, 2010

The Nonsense That Is Obamanomics

An Associated Press (AP) article yesterday reported on the self congratulations press conference that President Obama and Vice President Biden threw for themselves yesterday. They were almost giddy with their report on how their stimulus package of a year ago and saved the economy from the second Great Depression, how wonderful and full of foresight they were to have created the stimulus package and executed it so well. made me sick. Lawyers like Obama and Biden should never try to fool the American public and statisticians like myself when it comes to numbers.

First, lets lay out the numbers that are not in dispute and then do some math:
  • The unemployment rates during the time of the Great Depression, the 1930s, averaged about 20% for the whole decade, having a maximum level of about 25% in 1933 and a minimum level of about 17% in 1936.
  • The January, 2010 unemployment rate was 9.7%, equivalent to 14.8 million Americans being out of a job.
  • Obama just signed a bill from the Democratically controlled Congress, a Congress that has been under Democrats' control for over three years, that raises the debt limit to just over $14 TRILLION.
  • There are about 130 million U.S. households today.
  • The United States has lost about 8.4 million jobs since December, 2007, a period when the Democrats were in control of Congress.
  • The cost of the Obama stimulus program was $787 billion.
  • The Obama administration is claiming that the stimulus plan has already saved or created two million jobs, and could save another 1.5 million before it is done.
  • The average hourly wage in the United States in December, 2009 was $22.41 per hour, which translates into an annual wage of about $38,000.
Now let's do some math, under the doubtful suspicion that the jobs saved/created estimate of 3.5 million is valid and accurate:
  • If we divide the cost of the program by the Obama job number we see that the average cost to create a job under this stimulus program was about a quarter of a million dollars. This is almost six times the rate an average working American would make in a year. Not a real efficient way to create employment gains.
  • If the economy would have had 3.5 million fewer jobs without the stimulus package, then the unemployment rate would have been about 12%. Thus, maybe the stimulus package did not save us from the second Great Depression which had unemployment rates average around 20% and were much higher during the height of the Depression. Obama's claim in his press conference that he averted a depression is quite overblown ("One year later, it is largely thanks to the recovery act that a second depression is no longer a possibility.") I don't think so, much exaggeration here Mr. President.
  • By raising the debt limit to over $14 TRILLION, that pain if spread evenly across the entire U.S. household base would put every American household on the hook for just under $108,000. Thus, his taking credit during his press conference for the $400 and $800 tax breaks from the stimulus program looks kind of meek, relative to the $100,000 in debt he and the political class, Democrats and Republicans, have loaded onto our backs over the years.

These are not good results but they are the most optimistic since we used Obama's numbers. However, as reported many times in this blog, this whole process of estimating jobs saved/created has been riddled with bad data and assumptions. Jobs have been counted multiple times in some instances, some jobs that already existed were counted, etc. Thus, from a historical and political perspective, a case could be made that the 3.5 million estimate is little more than wishful thinking. We have seen numerous times where government estimates of costs, schedules, and other things have been off by factors of many times. Just as a sanity check, let's assume, and it is a generous assumption, that the number of jobs saved/created is only 2.5 million. What happens to the math then:

  • The cost to create/save a job gets even more ridiculous. The cost for each job is now $787 billion over 2.5 million or $315,000 per job. This 8.5 times the average annual wages of currently employed Americans. How inefficient is this process, regardless of whose number is used?
  • If the program actually did save 2.5 million jobs, than without it the unemployment rate would have been 11.3%, hardly Depression level numbers.

The political class does not get it. The government cannot create jobs, it can only create work, paying for that work by taking money/wealth out of the economy today and in the future (via deficit spending and increasingly high amounts of debt), to create temporary work projects today. While it may feel good to hire construction workers to work on a bridge project with stimulus money, once that stimulus money is spent, those construction workers are out of work again. The work did not endure past the stimulus funding. And the money used to pay for that bridge project was taken out of the economy where it may have been spent more efficiently in other parts of the economy. Certainly expending hundreds of thousands of dollars per job creation is not an efficient way to run an economy.

The sad part about the bridge example is that the government did not even get that right. As reported previously, the Associated Press found that about half of the bridge projects undertaken with stimulus funds were not in need of any repair, they were perfectly safe and usable as they were. Thus, the use of stimulus funds was not only expensive per job but a lot of those jobs were used on totally useless projects according to the AP investigation.

Americans spending their wealth on products and services they need and desire is the only way to expand the economy and job base and begin restoring freedom to our everyday lives. Continually expanding the tax burden on us while inefficiently using and wasting those taxes on faulty government programs is the exact opposite of what is needed to fix the economy. The government needs to get out of the job creation business, find a way to get the sky rocketing deficits under control and reduce the tax burden on Americans as much as possible.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Wednesday, February 17, 2010

This and That Of Recent Political Class Insanity- Courtesy Of the Cato Institute

Yesterday we covered a wide range of political class insanity from a number of sources. Today's follow up post is in that same mode but the insanity has all been documented in the last two issues of the "Cato Policy Report." The Cato Institute is a freedom and liberty promoting organization that is prominent in the fight against government waste and power grabbing. I recommend their articles, publications and books for all those that believe we can restore freedom in America.

The following examples come from their rear page, "To Be Governed..," column:

- Cato documented the following quote from President Obama as reported in the August 10, 2009 issue of the New York Times: "I've got a lot on my plate and it's very important for us to sequence these big initiatives in a way where they don't all just crash at the same time." To which Cato responded tongue-in-cheek: "Better To Have Them Crash Sequentially?" Two things wrong with Obama's comment. First, after more than a year in office we are still waiting for the first big initiative to become a positive reality. Thus, we have nothing to show for this past year. Second, as we have mentioned many times in this blog, the nation faces a multitude of problems (drugs, failing public schools, bankrupt approaching social programs, huge deficits and government waste, no national energy program, immigration problems, etc.). We cannot wait for ill-equipped politicians to do things sequentially, if at all, while these problems continue to ruin the country. Perhaps if the President had not been so involved in creating brackets for last spring's NCAA basketball tournament, or had not taken time off to film a TV commercial for the George Lopez Show or had not taken that ill fated trip to Denmark to lobby for the summer Olympics for Chicago, etc., he could handle a little heavier work load.

- The state of Michigan is threatening to fine and/or imprison a Michigan woman. Her crime? Her house sits in front of a school bus stop and she babysits her neighbor's kids when they come home from school until their parents get home from work. Another case of both government having its priorities screwed up (maybe the Michigan judicial system should spend its time chasing down real criminals) and restricting Americans' freedoms. It should be the parents who decide who and how their child are taken care of, not the state and political class.

- The Cato Policy reported on a quote attributed to Senator Joe Lieberman, as published in the November 9, 2009 issue of the San Fransisco Examiner: "I may be at a point in my career that I am going to do what is right and makes sense." I guess the two question to be asked are:
  • What have you been do so far? Voting for stuff that is wrong and does not make sense?
  • What made you change your mind to now vote for the right, sensible options?

- According to a Wall Street Journal article by Melinda Beck on November 29, 200

  • Life expectancy in the U.S. has reached an all time high, according to the latest statistics.
  • Death rates have dropped significantly for eight of the leading fifteen causes of death.
  • The overall death rate has dropped to an all time low of 760.3 deaths per 100,000 people, half of what it was 60 years ago.
Despite all of this good news, the political class wants to drastically overhaul our national health care system with a drastically deficient health care reform bill.

- The government employee who was the superintendent at the Gettysburg National Military Park has been reassigned to work in a cultural resources offices as an assistant to an associate director. Why the reassignment? An investigation found that the former superintendent had over 3,400 sexually explicit images on his government computer. By the way, the former superintendent will continue to draw an annual salary of $145,000 and his government pension will not be affected.

- According to Cato, Senator Thad Cochran was the most prolific politician to hand out taxpayer money via earmarks in return for campaign donations, handing out $212 MILLION in favors to donors. Examples included an earmark of $12 million for Raytheon in return for a $10,000 donation and a $6 million earmark to Circadence Corp. in return for another $10,000 donation (looks like Raytheon has a better lobbying firm than Circadence!).

Good stuff if it was not so depressing. Many of the steps outlined in "Love My Country, Loathe My Government" would address these atrocities It is a tribute to the Cato organization and others like them that we continue to see how wasteful, incompetent and destructive the current American class has become. Now it is up to us to make their work pay off.

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Tuesday, February 16, 2010

This and That Of Recent Political Class Insanity

Today's post will touch on a host of recent acts of political insanity that our good politicians have graced us with. No act by itself is big enough to fill an entire post but together you continue to get the feeling that we are governed by people that have neither the ability, the will, the intelligence, or the humility to lead this country to better times.

Senator John Edwards Sex Tape - as most of us know, Senator Edwards has finally admitted to having an extramarital affair and a child out of wedlock why his wife tried to recover from cancer. After initially denying having an affair and then denying the child was his, he has finally admitted to both acts and the additional act of trying to cover up both. A North Carolina judge involved with all of these shenanigans now wants to view a so-called sex tape that shows Edwards having intercourse with the woman of his affair. Rather than go into details of the judge's actions, let us just remember that this Senator came relatively close to becoming either President or Vice President of the United States. While what he does in his private life is usually no one else's business, by being a public figure of such prominence he forfeits some of that privacy. Affairs and cover ups probably require a lot of work and fibbing, energy that should have/could have been better spent serving his current and possible future constituents. Makes you wonder if others in Washington and other political offices (see: Spitzer, MacGreevey, Clinton) are so busy having affairs and covering them up, maybe that is the reason the proper amount of attention has not been spent solving real, national problems.

Eve Of Financial Destruction - We have had some recent fun pointing out how the Obama administration and the entire political class was spending so much money that they did not have, resulting in a skyrocketing national debt, that we were on the "Eve Of (Financial) Destruction," a takeoff on the hit protest song from Barry McGuire in the late 1960s. In those posts, we predicted that at some point in time, so much runaway spending would start to spook those people and nations, both domestic and international, who buy our bonds and debt. They might begin demanding higher interest rates as the potential for defaulting on those bonds rises. This potential seemed to be a little far fetched until today. In an Associated Press (AP) article today, AP reported that there was a record drop in foreign holdings of U.S Treasury bills and bonds in December, 2009. This could possibly indicate that some people in the world are getting a little antsy about the high deficit levels that the political class is incurring. A lot of the drop was due to the Chinese government dumping their U.S. Treasury holdings. Is this just a one time dip in demand for U.S. debt or the beginning of a trend where our debt will not only be rising but the cost to service it will also be higher? Who knows, but the concept of starting to get government spending under control (Step 1 in "Love My Country, Loathe My Government") might be a good idea to start implementing today before the trend actually materializes.

Senator Evan Bayh Not To seek Re-Election - Senator Bayh announced today that he will not seek re-election. Seems the Senator is very discouraged that the bickering and sniping in Washington was resulting in gridlock and not advancing any solutions for the issues facing the country. Well, duh? Many of us could have told him that years ago. The American political class has not solved any problem of consequence in over 40 years including the War on Drugs, the lack of a national energy policy and strategy, failing public schools, social programs heading for bankruptcy, etc. and he just recognized the ineffectiveness now? The sad part is he is probably in the minority when it comes to realizing how poorly we are served by those in the political class.

Subsidizing High Pro Athletes - A short article from the February 8, 2010 issue of Sports Illustrated, quoted ex-Pittsburgh Steeler Jerome Bettis. According to Mr. Bettis, the reason a lot of NFL players do not want to play in the Pro Bowl is because, "You have to offer them more money. If the players make 50 grand, 100 grand, that's different. But 25 grand? They can pass on that." Now, I believe in free markets and capitalism, any American is entitled to make as much or as little money as they want and their abilities will serve them. However, I do take offense to Mr. Bettis's comments and how out of touch they are with today's realities. If a person is fortunate enough to have a job in this economy, they probably are not making $100 thousand a year, never mind $100 thousand to play one football game. Now I would not endorse having the government regulating salaries in any industry. However, that does not mean that these astronomical salaries for today's pro athletes should be subsidized by ordinary Americans. Thus, Step 49 from "Love My Country, Loathe My Government" should be implemented so that Americans can still make as much money as they want and can but that companies, including pro sports franchises, cannot take these outrageous salaries as a corporate tax deduction to be subsidized by the rest of us.

Obama and Foreign Relations - I have been hammered by friends and family this past year of how well Obama will represent the United States in the eyes of the rest of the world, improving our foreign relations and statue in the world. After a year in office, lets see how well he is doing:
  • According to an article in Suddeutsche Zeitung by Hubert Wetzel, as reported in the February 19, 2010 issue of the The Week magazine, "The diplomatic world knows no greater rudeness than to skip a planned summit - and to announce that cancellation through the media." The summit being referred to is annual U.S. European Union Summit to be held in Spain in May. According to the article, the administration did not even involve its ambassadors in snubbing the Summit and the non-attendance has resulting in a lot of time planning the Summit to be wasted, embarrassing the host, Spain's President Jose Luis Zapatero.
  • After giving a speech at an Egyptian university earlier in 2009, no apparent progress has been made in defusing the Israeli/Arab/Palestinian problem. Nothing. For someone who promised so much in relation to negotiating and bringing parties together, nothing has happened that could not have happened under Bush, not that I want Bush back either.
  • Speaking of the Mideast, the Iranians have forestalled Obama for over a year now, all the while increasing its ability to produce a nuclear weapon while the Obama administration has done nothing significant to deter them. Threats have not been followed through on, deadlines have lapsed without repercussions, and current sanctions are not effective since the Iranians have probably accelerated their nuclear ambitions over the past year. Hardly a diplomatic victory for the administration. He has not gotten any further than Bush, while during his administration the Iranians are that much closer to having the Bomb.
  • Speaking of nuclear weapons, Obama has not had much more success with the North Koreans than Bush. Results are similar to Iran, the North Koreans ability to deliver a nuclear bomb is one year further along without any positive diplomatic developments.
  • In an article by Thomas Vampouille in Le Figaro, as reported in The Week magazine, it is reported that Obama has insulted President Nicolas Sarkozy of France many times the past year. The most blatant insult was when Obama sent a letter to Sarkozy but addressed it to Sarkozy's predecessor, Jacques Chirac. Other insults included rejecting Sarkozy's suggestion to overhaul the world's financial system and his efforts to advance efforts for Mideast peace.
All of these conditions do not look like like the diplomatic miracle many thought Obama would be. In fact, his record does not look much better or different than what we had under Bush.

Thus, despite a different administration, the insanity continues. Politicians have affairs and then spend more valuable time and resources covering it up, athletes are upset that they do not get even more outrageous salaries that are subsidized by the American taxpayer, the financial eve of destruction seems a lot closer today than yesterday, no problems ever get solved, and our diplomatic standing and effectiveness is no better today than it was a year ago. The concept of voting out all incumbents in November gets more attractive everyday, how much worse would it be to have new people sitting in Congress?

Visit our website at to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.

Saturday, February 13, 2010

Eve Of (Financial) Destruction Follow Up

A few articles have popped up in the past few days that are a good follow up to the Eve Of (Financial) Destruction posts we did a little while ago. An Associated Press article today reviewed how President Obama has declared that a new budget bill he signed recently will require the political class and the government to totally balance spending increases with concurrent spending cuts in order to force Congress to "pay for what it spends, just like everybody else."

According to the article, these "pay as you go" constraints were in place in the 1990s and helped to curb the rise in the deficit at that time. (Note: it helped curb the rise, it did not reduce the overall deficit, just made it grow slower.) However, since then, the constraints had been removed and Obama blamed this removal for the deficit levels he inherited and the additional debt of over $8 trillion that will be added to the deficit in the next ten years. At the same time he signed this bill, he also raised the U.S. debt limit by $1.9 TRILLION, from $12.4 TRILLION to $14.3 TRILLION.

I have a few serious problems with this half-hearted approach to solving this nation's dire financial condition:
  • Less than a year ago Obama pledged to start getting the Federal deficit under control by asking his Cabinet to find $100 million in total savings across the entire Federal bureaucracy. At that time we blogged that this feeble target of $100 million (on a $3.5 TRILLION budget) would reduce the current year's budget by .003%. If an average U.S. household making about $60,000 a year reduced their budget by .003%, the net result would be an annual savings of $1.71. In other words, the initial Obama attempt at cutting the budget was about equivalent to one Sunday newspaper for an American family, a trifling amount. Thus, I am not still not sure that he understands how bad our financial condition is when just a handful of months ago he came up with this non-starter from a deficit reduction perspective.
  • This latest proposal from the President is also kind of feeble. He apparently wants to freeze spending at current levels and make sure that new, future government programs are paid for by reducing costs in other, existing programs. My big problem with this approach is that the deficit will continue to grow and grow at a very fast rate since the expenses in the current Federal budget are about $1.4 TRILLION more than the expected revenue from taxes and other secondary sources. Thus, even if the politicians have enough discipline to obey this new edict, the deficit will continue to grow, perhaps by a smaller rate, but it will grow. The need is not to FREEZE spending at current levels, as he proposes, but to REDUCE spending. If you do not reduce current expenditures the deficit will continue to expand. And this assumption assumes that the political class can hold to this principle, something I find doubtful. My conclusion is that he still does not get how bad things are.
  • Another disturbing trend I continue see with this President is that nothing is his fault. Congress will "have to pay what it spends" and the elimination of the pay as you go rules from the 1990s resulted in the bad situation he inherited ($1.3 TRILLION annual deficit) and the new debt of $8 TRILLION over the next decade. Let us not forget that the $8 TRILLION in proposed debt is in the budget that he proposed just a few weeks ago. He did not inherit that number, he created that number. Also, please remember that under the Constitution, final budgets are created in the Congress, a Congress that has been under the control and run by the Democrats for the past three years. Thus, while Bush was President in two of the past three years, the Democrats could have gotten those deficits down if they wanted since they controlled Congress. Not that I am letting Bush off of the hook, he still signed those huge deficit budgets into law. The entire political class is to blame. I just wish Obama would stand up and take responsibility once in a while.
  • The article also reviewed how Obama was going to form a panel, by executive order, containing both Republicans and Democrats whose job would be to come up with suggestions on how to close the deficit spending gap. However, this panel would only be able to advise and Congress would not even be required to vote on any of its recommendations. Again, a very feeble gesture. How hard will this panel work at identifying real ways to close the gap if it knows that the Congress is highly likely to ignore their work? If Obama was really serious about this effort, and given the support he would likely get from most Americans, he should have taken the issue directly to the Congress and said he wanted a panel with real power and teeth and that the Congress would adopt the panel's findings. Instead, this panel will go off and probably take many months to come up with some weak recommendations (while the deficit continues to grow), nothing will be done with those findings and recommendations, and Obama can play the blame game again without doing anything serious about fixing the nation's financials.
Consider a few numbers if you still think that this nation's financial situation is not dire:
  • The recently proposed Obama budgets for the next ten years will add $8.5 TRILLION to the deficit, his numbers, not mine or the Republicans. I did a little research and found the net worth estimates of the richest 400 Americans in a summer Forbes magazine online article. The article estimated that the total net wealth, not income, of those richest four hundred Americans was about $2.4 TRILLION. Thus, if the government confiscated the total wealth of those four hundred and used it to offset just the additional deficit spending Obama has proposed, there would still be $6.1 TRILLION that the rest of us would have to pay off. If you assume that each household had to pay the same amount to get the country back to zero from an incremental debt perspective, then each U.S. household would have to kick in about $47,000 ($6.1 TRILLION/130 million households). In this view, Obama could not "tax the rich" to pay for his deficits since he would have already confiscated their total wealth which would account for only 28% of the additional deficit spending he is proposing. Thus, whether he will admit it or not, or even if he understands it, he has already significantly raised the tax levels for EVERY American with his deficit laden budget proposal. In fact, he probably has already raised the taxes for a few generations of Americans to come.
  • However, it gets worse. He has just raised the Federal government debt level to $14.3 TRILLION. Thus, by confiscating the wealth of the richest four hundred Americans, that wealth would cover only about 17% ($2.4 TRILLION/$14.3 TRILLION) of the government debt obligations. The other 83% would have to be paid by the rest of us, resulting in an additional tax burden of $91,500 per household to cover the deficit. And remember, this is just to pay off the debt, additional taxes would be needed just to pay for government services.
  • A recent Business Week column by Peter Coy, "U.S/. Debt: It's Not dark Yet, But It's Getting There" gave another, still pessimistic view, about our national debt situation. In a nutshell, our total debt will be about equal to our annual GDP in the next year or two. This is a so-called tipping point where international investors will start to worry about the U.S. ability to repay it's debt instruments since it's total debt is bigger than its annual economy. This situation would require us to pay higher interest rates to cover the higher risk of default, further spiraling us deeper and deeper into debt, requiring us to pay higher interest rates, etc. According to Mr. Coy national economic growth begins to slow significantly once a country's debt to GDP ratio gets above 90% (we are currently at 94% and heading higher). The example cited is the serious economic condition of Greece whose excessive government spending has resulted in a ratio well above one and the potential for the Greek government defaulting on its debt instruments. The U.S. trend is similar to what happened to Greece.
Given the dire consequences and the alarming trend of this nation's financials, the President does not want to reduce our national debt, he just does not want it to grow as fast. He proposes no concrete steps to get the situation under control, he just wants a toothless commission to examine the problem without Congressional mandates to follow through. Maybe he should finally read the copy of "Love My Country, Loathe My Government" that I sent to him. He could implement the following steps:
  • Step 1 - tell his Cabinet heads that they will have to reduce their total expenditures 10% a year for five years in order to wring out inefficiencies and redundancies from their operations. Finding $100 million is a joke, 10% a year for five years is real costs savings.
  • Step 5 - significantly increase enforcement efforts to stamp out fraud in waste in Social Security, Medicare, and IRS operations.
  • Step 30 - bring back all non-essential military troops we have deployed around the world including the tens of thousands of troops we have stationed in Japan, Korea, and Germany.
  • Step 6 - allow only individual citizens to contribute to election and re-election campaigns, effectively eliminating wasteful earmark spending from the budget.
  • Step 44 - operate no Federal program unless it materially affects a significant portion of citizens in at least fives states. If a program does not fulfill those requirements, then terminate it or let the affected state governments pay for it.
These are just a handful of steps that the book proposes. They certainly have more teeth and make more sense than blaming others and proposing do nothing panels. They are the only way to avoid the Eve Of Destruction.

Our new book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" is now available at our website, . It is also available online at Amazon and Barnes and Noble.