Wednesday, June 30, 2010

The Devastating State Of Our National Debt... And A Ray Of Opportunity

Two articles recently came to my attention that reinforced how overwhelming bad our national debt situation has become and how devastating it will be if we do not get it under control very quickly. First a Tampa Tribune article from early June, written by Gretchen Hamel, executive director of Public Notice, put forth the following data:
  • Government spending was less than 10% of the total national economy in 1940, it was 15.6% in 1950, it stayed below 20% for the past two decades but jumped to almost 25% in 2009.
  • The Congressional Budget Office estimates that it will stay above 24% of the total economy for the next ten years. This high level of government expenditures as a percentage of the total economy requires more and more taxes to be funneled to government expenses, drying up capital in the private sector which is where real jobs are created. We are starting to see the beginning of this effect since, despite high levels of stimulus spending, the joblessness rate continues to be very, very high with no relief in sight. Small businesses cannot get loans because of a number of factors, not the least of which is capital going to government.
  • Government spending per household has doubled during the past 10 years and is likely to double again in the next ten years. This will cause each American family's share of the national debt to rise from $115,000 today to $200,000 in ten years.
  • By that time our national debt will be about $20 TRILLION and will require four times the amount of debt serving tax dollars than it does today.
  • In ten years, interest payments on our debt and payments on Social Security and Medicare will consume 90% of the Federal budget's revenue. Thus, unless something else changes, all other government functions including the military, Cabinet departments, Congress, national parks, etc. will have to find a way to live on the remaining 10%. Obviously, this is not possible, meaning that either major functions are cut or taxes are raised significantly. Raising taxes reduces the freedom of every American to spend their wealth as they please and also restricts the growth of the private sector of the economy which reduces tax revenue, ... and the death spiral goes on and on.
Pretty scary stuff. But we are not done. Consider some information from an article by Veronique de Rugy in the August issue of Reason magazine:
  • In 2007, the annual national budget deficit was 1.2% of total GDP. By 2010 it had grown to 10% of GDP, roughly $1.4 TRILLION that the American political class continues to spend without tax revenue to support it.
  • A recent study by the International Monetary Fund concluded that the United States has one of the largest structural deficits in the world, almost as big as the deficit in Greece. We all got a taste of what that can become, with riots in the streets along with deaths.
  • The Obama administration has promised to freeze discretionary spending in order to save $250 billion dollars over ten years. $250 billion on a total national debt of $20 TRILLION amounts to about a 1.25% reduction in the size of the national debt, a trifling amount. Thus, the scary thing to take away is that the White House apparently does not get it, i.e. understand how dire our country's financial situation is becoming, given how anemic Obama's plan is for budget reduction.
  • Under the Republican's YouCut program, several non-essential, trivial budget cut proposals have been recommended by U.S. citizens and brought to the House of Representatives floor for consideration. All of them were voted down, mostly by Democrats. The average price tag of each proposed cut was $638 million, less than .02% of the Federal budget. Thus, the scary thing to take away is that Congress apparently also does not get it, i.e. understand how dire our country's financial situation is becoming, given how anemic their attempt was to cut out even non-essential programs.
Pretty depressing stuff. The numbers are outrageously bad but either the political will and/or political smarts of the political class is lacking. However, despite the politicians inability to deal with reality, reality does not change. As illustrated with our Snoopy and Peanuts analogy in an earlier June post, if the financial integrity of the country fails, everything else becomes meaningless. Clean air, clean water, retirement funds, freedom, everything becomes secondary once the financial backbone of the country collapses.

However, there is some hope. Ms. de Rugy reports on a new Goldman Sachs study by Ben Broadbent lays out the argument that budget cuts can be cut both economically and politically worthwhile, citing examples of significant budget reductions by foreign governments and the re-election of those politicians that enacted the budget cuts. A similar finding was arrived at in a 1998 Brookings Institute study. The Government Accountability Office found that overpayments by government agencies approaches almost $100 billion a year. Thus, tighter auditing and penalties for accounting mischief could save upwards of a TRILLION dollars by 2020. The Reason article cites a number of other countries, including Ireland, Sweden, Finland, Denmark, Belgium and Canada that made significant and necessary government budget cuts over the past few years, so it can be done. In the past few months, Lithuania cut government spending by 30% by slashing public sector wages and reducing pensions by 11%. If these other nations did it, why can't the United States is Ms. de Rugy's lament?

Let's not stop with the what of budget reduction discussed above, but move on to the how. The Cato Institute is in the midst of a huge undertaking, basically going through each Federal government Cabinet department and doing a detailed analysis of how to cut the Federal government down to size. They are done with five of the departments and are working their way through the last ten. Their findings and road maps on how to cut government down to size can be found at www.downsizing We will review some of their analyses and proposals in the coming months.

Thus, we now what has to be done , (cut down our government's size, spending, and national debt quickly and substantially), the Cato Institute and others are coming up with the how to do it, we know why we have to do (save our freedom and the democracy we should be living in), and we know the when (immediately). The only question left is the who. Current residents in the White House and Congress may not be the who. Their arrogance and stubbornness to reduce their power base and the size of government indicates that most of them sitting in Washington either 1) do not understand the magnitude of the problem, 2) do not know how to fix the problem, or 3) choose to ignore the problem for whatever reasons known only to them. Whatever the cause, it is unacceptable. Making the dumping of all incumbents in November critical to moving on to the how of the problem and getting this nation's financials in order as soon as possible. Snoopy would have it no other way.

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

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Tuesday, June 29, 2010

A Few Thoughts On Downsizing The Size Of Government - Human Resources Reductions

I really get scared listening to people discuss on how this is not the right time to downsize government since, in their minds, the economic status in this country is still very fragile and any government downsizing would help cause a double dip recession. This position makes no sense on so many fronts:
  • Does it mean that we should continue to waste taxpayer dollars through the incompetence or laziness of current government workers (e.g. SEC employees who did nothing on the job except search for porn, Interior Department employees who also spent work time surfing the Net for porn and who said they inspected oil rigs in the Gulf but did not, etc.)? How does this help the economy stay afloat?
  • Does it mean that all government functions, even the unnecessary ones, should continue to be funded and continue to waste taxpayer dollars?
  • Does it mean that Federal government employees, that enjoy higher than average salaries and benefit packages should not have there employment compensation reduced or at least frozen, given their private sector counterparts are suffering through very tough economic times?
  • Wouldn't it be better to let the taxpayers keep some of this money and spend it on what they want? Overall economic activity would not go away if government was downsized, it would just move into other, more productive areas of the economy while increasing personal freedom in the process.
No, the proponents of this ridiculous theory are just mimicking the words of the political class that do not want the size of government reduced since it would reduce their power and status. Today we will start the first of an occasion series of ways to downsize government that reduces the size of the Federal bureaucracy and increases both the financial freedom and personal freedom of individual Americans. If some politicians lose power and status in the process, that is a risk I am willing to take.

Today we will focus on human resources area to reduce government's size. If I can come up with some worthwhile ideas, I am sure some more involved people could do even better. Thus, I present human resource ideas to reduce the size of government:

- Why do we still have 27,000 U.S. troops in Korea? The North Koreans have over a million troops and the South Koreans have almost 800,000 troops. If war breaks out, our 27,000 troops are not going to make a very big difference. This type of government thinking is a leftover from the Cold War era, let's bring those troops home and save the cost of deployment. A side benefit might actually be a reduction in tensions on the Korean peninsula since the North Koreans could not use the excuse that U.S. was about to attack them since our troops would be gone. The Obama administration estimates that it costs a $1 million a year to deploy a soldier into combat zones. Let's assume it takes about half of that ($500,000) to deploy a single soldier into a non-combat zone. Thus, bringing home 27,000 U.S. troops from Korea would save about $13 billion a year. I fail to see how this type of downsizing would cause a double dip recession.
- Why do we still have about 35,000 troops in Japan? The second world war has been over for a while and if we think that having those troops in Japan will deter China from doing anything, half way around the world, we are kidding ourselves. China has over two million soldiers in their armed forces. For example, if China wants to go into Taiwan, there is virtually nothing that 35,000 troops in Japan can do to stop them. Again, a leftover remnant of the Cold War. Bring them home and save $18 billion a year. A potential side benefit of withdrawal would be improved relations with Japan since the U.S. military bases, especially on Okinawa, have always been a source of diplomatic friction.
- Why do we have over 50,000 troops still stationed in Germany? Again, a leftover of the Cold War. Do we really think that Iron Curtain forces are going to roll over western Europe? Oh yeah, there is no Iron Curtain any more. Bring home those troops and save about $25 billion a year. Is reducing government spending in these three countries likely to cause a double dip recession as the mimics state? I doubt it. Thus, just with these three military human resource-like actions we could conservatively save $46 billion a year.
- With over 100,000 troops coming back stateside, there would be no immediate need to recruit new soldiers, these 100,000 would serve us well for a long time, especially if we did not deploy them back to Korea, Japan, and Germany. Thus, much lower recruitment costs would result in additional savings. How in the world would that lead to a double dip recession? And these three troop deployments are not the extent of our foreign deployment.
- Why do we have almost 100,000 troops still in Iraq? Didn't candidate Obama promise to get us out of Iraq? President Obama has fallen flat with that promise. In fact, Obama's long range plan is to still leave 50,000 troops in Iraq. Sounds an awful like the same type of thinking that caused us to deploy troops unnecessarily in Japan, Korea, and Germany for decades. Bring home the 100,000 troops from Iraq and save about $50 billion a year if you assume that they are no longer in a combat region.
- According to a Money magazine article in their June, 2010 issue, about 20% of workers in private sector pension plans, 3.3 million Americans, have recently had their pension benefits frozen. This generally means that whatever pension you qualify for today is what you will retire with. There is no growth in the benefit by accruing more years with the company or moving to a higher salary, which would usually increase future pension payment levels. According to the article, this trend of freezing private sector pensions is likely to continue, given the hard economic times. An additional statistic from the article pointed out that only 15% of private sector employees now enjoy the benefit of a traditional pension.
In a related article that appeared in Kiplinger's Personal Finance magazine in their June, 2010 issue, the article reported that even worse then freezing a pension plan's benefits was the trend of many private sector pensions just going belly up, usually resulting in a government agency stepping in to try and salvage at least part of the plan. The result, however, is usually a greatly reduced pension benefit.
Given this trend for private sector employees, the death of the traditional pension, it is not fair for Federal employees to continue to enjoy such a benefit in addition to Social Security and a 401k like savings plan. Given that private sector employees provide the retirement benefits to public sector employees through their tax dollars, we need to level the playing field and eliminate the idea and benefit of a traditional pension for future Federal employees. If private sector employees are not receiving such a benefit at their work and those that still do are seeing their pension benefit get greatly reduced, then they should not be burdened to pay for something they cannot get, namely a traditional pension benefit program for future Federal employees.
- Step 34 from "Love My Country, Loathe My Government" would prohibit the use of Federal taxpayer dollars for any program or project that does not significantly impact the citizens of at least five states. If a program did not meet this criteria, it would be up to the state or states to get the job done. This is the Federal government, it should be worried about national problems and national issues, not local issues. Let the individual state government pay for the individual state benefit using the tax dollars of just those citizens in that state. Thus, the Robert Byrd method of funding intrastate projects would end.
- There is about $16 billion in earmarks in the current Federal budget, most of which are used to reward local entities or used to award earmarks in exchange for campaign re-election donations, neither of which provide value added service to most Americans' lives. As we have pointed out previously, recent earmarks have been used to renovate theaters, build a farmers market, and build a bike path. Given that the restoration effort of the Statue Of Liberty never got any Federal funding support, these other, trivial projects should also not receive any Federal support. Do we really think that if the Federal government stops building bike paths that will cause a double dip recession.? Save the $16 billion and return it to the taxpayer to expand other areas of the economy which they will do more efficiently than the government will do with farmers' markets and bike paths.
- A recent USA Today article reported on a payroll analysis that showed 80% of government jobs that have a private sector equivalent make more money than the private sector position. Thus, since government jobs are funded with private sector taxes, its only fair that wages for all government employees be frozen at current levels until further notice or until this imbalance is resolved. This includes the salaries of anyone sitting in Congress.
- On a more symbolic level, Step 42 of "Love My Country, Loathe My Government" would force former Presidents to begin paying for their Secret Service protection after they leave office, if they can afford it. Since Bill and Hillary Clinton have earned over $100 million since he left office, it makes no sense for strapped taxpayers to continue to pay for Clinton's protection. Let him pay for at least a portion of it since with his $100 million in earnings, he can afford it. While this would result in relatively small savings, it would indicate that the political class is doing their job to help the economy. No way this step would lead to a double dip recession.
- Also on a symbolic level, Step 41 would not allow any sitting politician to draw a Federal salary if their net worth was over three million dollars. It makes no sense for the many millionaire sitting in Congress to draw their $174,000 a year in salary and benefits. If they are not rich, let them have their salary. If they are like John Kerry, who is worth hundreds of millions of dollars, they starts working pro bono immediately. While not saving billions of dollars, it would be another example of politicians identifying with the struggles of their constituents by foregoing their salary. They would also not be allowed to draw a traditional pension, their constituents are not receiving one for the most part, they should not receive one either.
- It has been pointed out numerous times these past months, by Federal regulators or inspector generals, that many Federal employees were either too busy pulling porn down off of the Net during work hours (e.g. SEC and Interior Department) or were too lazy to do their jobs (e.g. lead and cadmium based toys flooding the toy market, Toyota safety problems going undiagnosed for many years, Energy Department employees approving every product submitted for EnergyStar certification even if they were bogus, etc.). Thus, from an outsider perspective, there are a lot of excess Federal employees that can be fired without affecting the basic government function or department they were involved in. Thus, Step 1 of "Love My Country, Loathe My Government" becomes another, non-harmful way to reduce the size of government. This step would institute a five year program that would reduce the size of every Federal department by 10% a year for five years. This approach would squeeze out those excess, porn seeking employees and cause the remaining ones to focus on just the most important government functions.

Thus, even as a non-expert on government human resources, here are about a dozen or so simple suggestions that would greatly reduce the size of government, helping to return hundreds of billions of tax dollars to taxpayers who would grow the economy more efficiently and could also help reduce the obscene Federal deficit, also growing the economy. The myth that we need government to continue to spend money to save the economy is just that, a sad, pathetic myth. It is propagated by the political class to ensure that their influence and dominance of the country continues to grow. The government spends money in extremely wasteful ways, allowing them to continue to do so will never heal the economy, it will just continue to waste wealth and hinder the economic recovery. Just ask yourself: increase government spending (and waste) over the past two years has not worked in moving the economy strongly forward, not when total unemployment is probably approaching 20%. Why continue to do so?

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Monday, June 28, 2010

Political Class - Missteps and Misquotes

Just a clean up post today to summarize some of the more bizarre and infuriating missteps and misquotes of our political class and government over the recent few months. This is by no means a comprehensive list, just some that have fallen into my lap without even trying to find them:

- Let's start with a quote from Iowa Congressional candidate Pat Bertroche on illegal aliens that was originally quoted in the Cedar Rapids Gazette on April 27, 2010: "I think we should catch 'em, we should document 'em, make sure we know where they are and where they are going. I actually support micro-chipping them. I can micro-chip my dog so I can find it. Why can't I micro-chip an illegal?" Where to begin on such an inane quote as this? Did Mr. Bertroche consider the following:
  • If there are truly over 12 million illegal aliens in the country today, what would be the cost of actually finding even a fraction of these people who do not want to be found in the first place and is that a good use of limited funds and law enforcement resources?
  • If we somehow did find many of them, why would we not send them back to their home country rather than document them and track them like you propose? Wouldn't it be much more inexpensive to just return them from where they came?
  • If you did return them to where they came from, there wouldn't be any need to microchip them, would there?
  • And finally, did Mr. Bertroche graduate from the George Orwell School of Political Thought? The idea of micochipping any human being in order to control their life, regardless of who they are, is repugnant and so 1984ish. People are not dogs, Mr. Bertroche, regardless of their political status.
- No post like this is complete without the latest incident courtesy of our Vice President, Joe Biden. Campaigning in Wisconsin recently for Demcoratic Senator Feinberg, the Vice President stopped in a frozen custard shop for a little local politicking. After given a frozen custard, he asked the owner what he owed the shop. The owner replied: "Don't worry. It's on the house. Lower our taxes and we'll call it even." To which Biden condescendingly replied: "Why don't you say something nice instead of being a smart ass all the time? Say something nice." Where do we start with this one (the entire incident is on various news Internet sites and YouTube):
  • From the news reports and the actual video of the encounter, the owner was not acting in a flip or disrespectful manner that would justify being called a smart ass by a leader of the country.
  • Since Biden had never met the owner before, why did he assume that the owner was a "smart ass all of the time?" Makes no sense.
  • And what is wrong with an American expressing his views about the tax situation in this country? He has the right to express his opinion without being called a degrading name.
  • I particularly like Biden's second sentence, "Say something nice." It comes off as pompous and arrogant to insist that people say nice things to him.

- Although I do not have the exact quote from the government official, I decided to include this incident today anyway. According to a short article in the "Only In America" section of the July 2, 2010 issue of The Week magazine, a 28 year old rafting guide in Colorado was arrested and charged with "obstructing government operations" because he dove into a river to help rescue a drowning 13 year old girl. By doing so, he disobeyed a direct order from government officers when he made his way through river rapids to help the girl who had fallen out of her raft. Let's see: help save a drowning girl or listen to an order from a government bureaucrat? Thankfully, the river guide, Ryan Snodgrass, did the right, human thing and took the dive despite becoming a criminal in the eyes of the government.

- Saving the best for last, this one comes courtesy of Congressman Hank Johnson of Georgia. I had to go to the Internet and actually see the exchange to believe what the Congressman actually said, it is that unbelievable. I was made aware of the Congressman's quotes from a recent Cato Policy Report publication that quoted an article from The Hill publication from March 31, 2010. In a hearing with a Navy admiral, Congressman Johnson stated that he was afraid that the U.S. Territory of Guam is going to "tip over and capsize" due to over population. His exact quote was: "My fear is that the whole island will become so overly populated that it will tip over and capsize." While stating this opinion, the Congressman made a tippy motion with his hands, according to the article. This is one of 535 members of Congress that is responsible for the direction of this country, one of our so-called leaders. If that does not keep you up at night knowing that a leader in this country is worried about islands flipping over, then you are a better person than me. I wonder why Manhattan Island has not flipped over? It has many more people than Guam on a small geographic footprint. It also has many more skyscrapers than Guam that make it more top heavy. Is the Congressman aware of this situation?

There you have it, just four examples of the political class and their government agents that have no clue about reality (how impossible and ridiculous it would be to microchip 12 million people who do not want to be found), no clue about our rights to express an opinion without being called a degrading name in public ("smartass"), no clue about setting the right priorities (saving a life in distress is better than obeying a government edict), and those that just have no clue at all (those who think that islands actually float in the ocean and have the ability to flip over.) Be scared, be very, very scared. Just four more examples why it is critical this November to get rid of those in power that see themselves as more important and smarter than the rest of the country and install new politicians that are actually smart, humble and creative leaders. If Guam flips over because of neglect by new leaders, that is the risk I am willing to take.

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Saturday, June 26, 2010

A Politician Who Might Actually Be Getting it Right

Late last year we wrote about a small set of politicians that were trying, and succeeding in some cases, to do the right thing, namely delivering essential government services in a timely and efficient manner. We spoke glowingly of the Miami Gardens municipal government that in the midst of the economic downturn continued to fix up schools and parks, did not need to lay off any workers, gave their workforce raises, and ran a lean but effective government entity.

Senator Lamar Alexander showed that he understood how government finances worked when he tried to pass legislation that would take the government ownership of General Motors and distribute ownership via shares of stock to the American people. He understood how it was the money of individual taxpayers who paid for the GM bailout, they should get the rewards. Government and the political class should not be in charge of a bailed out GM, it was not their wealth that did the bailing. Alas, his good idea was shot down.

Since then, I have looked for other examples of politicians doing the right thing for the right reason. Unfortunately, I have not found enough of this type of behavior to justify a blog until now, although it concerns only one politician. Governor Mitch Daniels is the Governor of Indiana. Consider what is going on under his tenure as governor according to a June 10, 2010 article in Businessweek magazine by James Warren:
  • Indiana is only one of ten states that has seen its unemployment rate go down on a year over year basis, from 10.5% in May, 2009 to 9.8% in April, 2010.
  • While many states are seeing their creditworthiness dropping as a result of their financial mismanagement by their state's political class, Indiana has a triple-A credit rating.
  • While states like California ($20 billion deficit) and New Jersey ($10 billion deficit) are just two of many states having trouble paying their bills, Indiana has a budget surplus.
  • State property taxes have gone down in the face of both hard economic times and a budget surplus.
  • The state payroll has been decreased but he enlarged the staff of the agency responsible for child welfare, resulting in a 40% decrease in children's' deaths. He also expanded the state police force with the specific intention of reducing traffic deaths, successfully reducing deaths from 814 in 2008 to 680 in 2009.
  • For the first time since the 1970s, more people are moving into Indiana than moving out.
  • Chrysler has recently announced that it will invest $300 million in two of its Indiana plants.
  • A computer design firm recently announced that it will move its operations into Indiana.
  • A Chinese furniture maker will open its first U.S. assembly plant in Marion, Indiana.
  • Indiana has only 2% of the country's population but generated 7% of the nation's new jobs this year.
  • He outsourced a number of state functions including prison food that reduced the cost per meal from $1.43 to 4.99 while improving the quality.

Could this actually be happening? Is it possible for a government entity to get smaller, spend less money, deliver higher quality, and improve the lives of its citizens? Apparently the Indiana governor is doing it successfully. According to the article, the governor is thrilled by metrics. By understanding the metrics, he has been able to understand the underlying root causes of problems and then apply the proper solutions. Sounds like basic problem solving but it is a skill that is widely lacking in most politicians today. Most politicians address a problem or issue from the perspective of how can this problem help me get re-elected. Governor Daniels apparently addresses a problem by understanding its parameters which helps him understand the root causes from which he can come up with the right solutions, re-election impacts be damned.

The article concludes with two problems with the current situation. First, some Indiana politicians are upset that they sometimes feel they are playing a minor role in the governor's world. My answer to that is for these pouty politicians to make themselves helpful and useful problem solvers rather than complain that their ego is not being stroked. Whatever is being done in Indiana seems to be working for its citizens, let's not let petty politics get in the way. The Governor's approval ratings are between 60 and 70% and he was elected as a Republican in a state that voted for Obama in 2008.

Second, according to the article, Daniels does not have Sarah Palin's "rhetorical fire" or the physical statue (he's only 5'7") versus other likely Republican candidates for President in 2012. To which I say, lord help us if problem solving is a secondary requirement of a leader, ranking behind someone who can give a fancy speech or who is physically imposing and tall and lean. We have a tall, lean fancy speech giver in the White House today who has accomplished nothing in the past year and a half except further divide the nation. Maybe a problem solver is not such a bad idea after all.

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Thursday, June 24, 2010

Exposing The Myth: "I'm from the government and I am here to help you."

I am assuming that at some point in our nation's past, this was a true statement. That was when government was much smaller and more focused on a limited set of functions. So limited, in fact, that it was actually good at getting problems solved. However, given the behavior of today's government functions, personnel, and the American political class these past few years, it is probably true that this statement is not longer a fact, it is just a myth. Consider the following myth busting behaviors:
  1. The Securities Exchange Commission (SEC) is responsible for overseeing the integrity of the accounting processes and accuracy of public companies financials. They were obviously asleep at the wheel when many of Wall Street's largest financial firms either went bankrupt or dove into deep financial stress at the onset of the greatest financial collapse in this country since the Great Depression. How did this economic and financial fiasco occur with almost no advance warning by the SEC? A possible answer was published in an April 23, 2010 Associated Press article which reported on the findings of an SEC Inspector General analysis. The analysis found that more than two and half dozen SEC employees were found to have used their government issued computers to search the Internet for pornography during the time they should have been hard at work protecting the interest of Americans who invest in public companies. As examples of their findings, one SEC attorney spent up to eight hours a day downloading pornography, burning his findings to CDs and DVD discs once his hard drive filled up with the pornographic material. An SEC accountant was blocked over 16,000 times in one month (or about 800 times a day, 10 times an hour) from visiting pornographic websites yet he was able to eventually collect a collection of pornographic material on his government computer by using a method to bypass the SEC filters. Seventeen of the pornography seekers at the SEC were considered "senior level" employees, earning salaries up to $222,000 a year. These government employees were obviously too busy to help protect the interests of the American investors, people who lost untold billions of dollars as a result of the financial crisis that the SEC staff never saw coming.
  2. In January of this year, the Department of Health and Human Services issued a report that concluded the $150 billion that the Federal government had spent on the Head Start program since 1965 has no long lasting benefits to the children that had been enrolled in the program. Another analysis, this one conducted by the Heritage Foundation found similar results: "Head Start has little to no effect on cognitive, socio-emotional, health, and parenting outcomes of children participating in the program." Thus, rather than delivering the benefits that Head Start is supposed to deliver, we are left with an annual multi billion set of early education government programs that are little more than a government subsidized baby sitting service.
  3. In the April 26, 2010 issue of Newweek magazine, an article by Dan Stockman exposed the fact that the Environment Protection Agency (EPA) is not doing a lot of protecting, at least relative to the Clean Air Act. According to research done by Mr. Stockman, his analysis of the EPA's public database of enforcement records showed that on a national basis, more than 750 companies have been in continuous violation of clean air laws since 2007. Included in these 750 companies were over two hundred companies defined as high priority because of the severity of their offenses. What good is having a law and identifying offenders if there are no consequences or changes in behavior? Not very helpful.
  4. In the April 9, 2010 issue of The Week magazine, there was a short article about how shoddy the work at the Energy Department is relative to classifying products as deserving of a high energy saving appliance rating within the EnergyStar program. A company who gets an EnergyStar rating can market the energy efficiency of their product, as approved by the government, and theoretically sell more products and/or sell them at a higher price. Consumers would look for the EnergyStar designation with the false assumption being that these are good deals from a cost of energy perspective. One problem though. The article reported on a sting operation by Federal regulators that sent bogus designs to the people running the EnergyStar testing program. These bogus products included a gasoline powered alarm clock (certainly not a very efficient way to tell time) and a feather duster attached to a space heater that had been called an "air filter" by the regulators. Unfortunately, both of these bogus products and most of the others were awarded the EnergyStar status by the Energy Department. Obviously, the Energy Department is not here to help you distinguish energy efficient products from those that are not if these somewhat outrageous fake products can pass muster with the inspection process.
  5. Most people probably know that Toyota has been having a spate of safety problems with it's cars over the past few months, with accusations that these safety problems have resulted in traffic fatalities. What most people do not know, as reported in the March 1, 2010 issue of Businessweek, the government had opened, and shortly thereafter closed, eight inquiries into the problem with Toyota products, starting back in 2003. In all eight cases they found no significant problems and closed all probes with no action taken. It was not until the past year or so that the government finally recognized that maybe there is a problem and Toyota was finally forced to take remedial action on its vehicles. The article points out the fact that the two government interface executives at Toyota used to work for the very government agency responsible for automobile safety, implying that the government might have gone easy on their former co-workers. Given that upwards of a hundred Americans may have died as a result of faulty Toyota products, it does not look like the government is helping anyone here either.
  6. Several years ago the government belatedly pulled a series of imported toy products from China off of the shelf because the products were made using lead based materials that could seriously hurt a child if the the child put a toy in their mouths and the lead entered their systems. While the good news is the government safety organization finally got the products off of the shelves, it would have been much better if they had never entered the country in the first place, Even worse, according to a May 20, 2010 Associated Press article, the overseas producers simply replaced their lead laced products with cadmium laced products which are just as dangerous. One would have thought the government would have been a little more alert to these types of products since they had just gone through the lead based experience. Alas, they were no better the second time around as the cadmium products came ashore.
  7. A May 17, 2010 Associated Press article reported on the many oversights and incompetence that Federal employees of the Minerals Management Service (MMS) Federal agency, the agency responsible for overseeing the safety of oil rigs in the Gulf Of Mexico. According to the article and an internal report, not as many inspections were done as required, many MMS employees received hunting and fishing vacations along with other gifts from the same companies they were supposed to keep in line from a safety perspective, some MMS employees were inspecting oil rigs of companies at the same time they were in negotiations for employment by those companies, and some MMS employees admitted being addicted to illegal drugs while being responsible for safety inspections and compliance. These Federal employees were obviously little help in preventing the devastating Gulf oil spill.
  8. The Department Of Homeland Security has certainly not been helpful. This past December, a would be terrorist traveled from Somalia to the skies over Detroit and would have blown up the airliner he was in if his underwear bomb had not malfunctioned. In the spring, another would be terrorist almost blew up a car bomb on the streets of Time Square which failed to explode only because of a defective bomb. Unknown numbers of illegal aliens and drugs continue to flood over our southern border with Mexico. Are we feeling secure yet?
  9. In a related non-helpful effort, an article in the June 11, 2010 issue of The Week magazine recalled a resolution from the House of Representatives in 1986. At that time, the House demanded that the Pentagon seal our borders within 45 days against illegal drugs. Looks like they missed that deadline.
  10. The No Children Left Behind legislation from the Bush administration has proven to be unsuccessful in raising the lower than expected learning levels of American children relative to the education of children in many other countries. Thus, nothing has changed since the Reagan administration issued its scathing report on American public schools in 1982, "A Nation At Risk." Thus, the American political class and its government processes have been unhelpful in at least twenty eight years in raising education standards and output of the country.
  11. Finally, the biggest non-help in the past sixty years was obviously related to the financial crash and economic downturn of the past few years. Numerous government agencies were absolutely no help in foreseeing and managing the housing and banking crisis that caused the so-called "Great Depression." These Federal government entities include Fannie Mae, Freddie Mac, SEC, Treasury Department, Federal Reserve, House of Representatives housing and banking committees, Senate housing and banking committees, the FDIC, the Bush administration, the Obama administration, and any number of other unhelpful government organizations.

Did we leave anyone out? We need to get over the myth that government is somehow an efficient and effective ally in our lives. The above examples should be proof of that. Many Americans still think that once a law is passed or a program established that the battle is over and everything will be great: government workers and agencies taking care of things in a super efficient manner at a reasonable cost. Given the above list of incompetencies and the record, sky high national debt levels we have, we are getting the worst of all possible combinations - high cost, low quality.

That is why Step 1 of "Love my Country, Loathe My Government" is so important. Step 1 would start a five year systematic downsizing of government in order to reduce our national debt and get government smaller and more focused on just the important, major issues of our times. The logic is if the political class and government agencies have less to worry about, they may actually get good at a few things. It makes no sense to continue to support a government bureaucracy when all we get is the low performance or non-performance described above. Drastically downsize and focus, that is what must be done to get us out of the high cost/low quality zone into the low cost/high quality zone. Then, and only then, might the myth "I'm from the government and I am here to help you" might actually become a reality again.

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Wednesday, June 23, 2010

Cash For Clunkers - Real Estate Style

We have discussed the much maligned Federal government program, Cash For Clunkers, last year. The basic premise of the program is the government, using taxpayer money, gave new car buyers thousands of dollars in a tax credit rebate if the purchased a new car late last summer. The hope is that this would incent consumers to rush out and buy a new car and spark the economy.

Unfortunately, none of the program's objectives were met. As we look back on the historical monthly sales rate, it becomes apparent that new car sales actually did spike upwards the last month of the rebate program, Unfortunately, as soon as the incentive ended, sales plunged when measured on a seasonally adjusted basis. The obvious conclusion is that many of the sales were not incremental, the program just pulled forward sales that would have happened anyway. All it did was give away billions of dollars to car buyers, most of whom would have spent their own money anyway. Other problems, that we will not rehash today, included the fact, that contrary to the program's intent, many of the vehicles sold were not fuel efficient ones that were hoped for and that the used cars that were turned in were destroyed, drying up the used car market, and driving up prices for those Americans that could not afford a new car.

Given that failure, one would have hoped that the political class would not launch another such program. Unfortunately, that hope was dashed when in 2008, the government launched a rebate program for first time home buyers, hoping to spark a rebound from low home sales volumes. The program eventually evolved so that first time home buyers would get an $8,000 tax credit and repeat buyers would get $6,500. The only criteria is that buyers had to enter into a contract for a home by April 30, 2010 and close on the house by June 30, 2010.

You can only guess what happened. In an Associated Press article by Alan Zibel on June 22, 2010, the National Association of Realtors reported that sales of existing homes fell 2.2% in May, contrary to the recent trend and far below what many housing experts expected. The article reported that many of these experts now think that sales will continue to trend down as the new home owners rebate program ends later this month. Thus, we will likely see the same results as Cash For Clunkers, many of the home sales for the past few months, leading to that upward trend, were nothing more than people moving their purchase plans forward to grab the $8,000 and $6,500 rebates. It is highly likely that existing housing sales were continue to drop in the next few months since the sales that would have happened, already have under the program.

And now today, Mr. Zibel wrote another housing article where he reports that the sales of new homes in May were down a whopping 33% on a seasonally adjusted basis, the lowest level since tracking began in 1963. According to the article, "analysts were startled by the depth of the sales drop." If they had tracked the Cash For Clunkers program, they would not have been surprised. The government incentives ended and thus, the market did not pull forward any more sales. I expect that you will continue to see a very low level of sales of new homes since many of them had already been pulled forward, much like Cash For Clunkers.

Thus, the government and the political class continue to learn nothing from their experiences in providing incentives. These programs rarely work in that they do not generate a substantial amount of incremental sales, the basically give away taxpayer money to people that would have eventually used their own money for the car or house purchase, and the administration of such programs is usually sloppy, inefficient and worse, subject to fraud. According to recent news reports, based on an analysis by the Treasury Department's Inspector General Russell George, the investigators found the following instances of fraud just from 2008, when the home rebate program began:
  • The IRS paid out $9.1 million to just under 1,300 people who were in jail at the time they said they bought a home. This computes out to about $7,000 per prisoner
  • 241 of those prisoners were in for life terms, making it highly unlikely they had bought a home or would ever buy a home.
  • $17.6 million were paid out to 2,555 people who purchased their home before the program started but who still received their tax credit.
  • Over 10,000 people got a tax credit rebate for a home that also was used by another taxpayer to claim the credit. In one case, 67 different people claimed, and received, the tax credit for the same address. Can you say "organized crime?"
  • Eighty seven IRS agents themselves filed fraudulent claims for homes that did not qualify for under the program.
  • In a late 2009 Bloomberg report, some of the early claimants for the tax credit were made by kids under the age of 18 with one of the more infamous cases involving a four year old who filed for the tax credit.
As with Cash For Clunkers, this was an ineffective program from a sales incentive program, it did not generate many incremental short term sales or increase the long term trend and worse of all, it was riddled with fraud, wasting millions, if not billions, of taxpayer money. This report covered only 2008, according to the the Inspector General, and did not cover the 2009 and 2010 activities. Thus, the fraud numbers could go up even higher if the IRS did not get things under control. And the numbers will probably go higher since news reports indicate that the IRS wrote a letter to prison officials today, asking for their help in the prison fraud area. This letter happens as the program is about to end, what good will that do? Finally, this is the fraud they uncovered, how big is the fraud that they did not identify but still paid out on? Pathetic.

But lets not stop here with government/political class incompetence in the housing market. According to as reported in The Week magazine on June 25, 2010, the two government mortgage giants, Fannie Mae and Freddie Mac, will need $389 billion in taxpayer subsidies between now and 2019. This is in addition to the $145 billion they have already received. Thus, these two government operations will cost every American household about $4,600 on average to pay off ($534 billion divided by about 117 million U.S. households). Such a deal.

These are just a few examples of the economic ignorance of the political class. The home buyer tax credit/rebate credit was supposed to prop up housing prices, according to it supporters. However, just the opposite is needed. Prices need to fall to the level where people are willing to use their own money to buy a home. By artificially propping up housing prices through the tax credit program, it just delayed the time when the housing market will turn around, i.e. when prices are in line with income levels. Until that happens, no short term incentive program is going to turn around a massive segment of the economy. All it does is needlessly give away taxpayer money to people who likely had enough money to purchase a house anyway.

Both Fannie Mae and Freddie Mac need to be eliminated as soon ass possible in an organized systematic way. They control (i.e., politicians control) far too much of the economy and have proven that they cannot operate their respective operations unless taxpayers give them a half a TRILLION dollars, money that could be better spent remaining in the wallets of taxpayers. Too much control means lack of freedom, too much incompetence means too much of a financial burden.

Several steps from "Love My Country, Loathe My Government" would address these issues. Step 36 would require all government employees including members of Congress and the Presidential administration to take and pass a course in basic economics so that we no longer see these wasteful rebate and tax credit programs that never work. Step 1 would start an immediate downsizing of government since most of it does not work effectively or efficiently. The half a TRILLION in savings form shuttering Fannie and Freddie would be a great way to start reducing our national debt. Step 39 would institute term limits so that we could get rid of these tired, economic illiterate politicians who have been in office for decades but who still insist on rolling out ineffective government economic programs (Cash For Clunkers) and ineffective government bureaucracies (Fannie and Freddie).

All of this bad news on bad government programs and we did not even address the Cash For Caulkers and Cash For Appliances failures....

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Tuesday, June 22, 2010

Screwed Up Government Priorities, Case #3 - Odds And Ends Of Bad Priorities From Around The Country

For the past two days we have looked at two major examples of where the Federal government has really irrational and screwed up priorities. Two days ago we analyzed how the Federal political class spends about seven times more taxpayer payer dollars on their pet projects/earmarks, projects that are primarily used to gather re-election funds and donations, than they spend on cancer research which kills thousands of Americans every year. Yesterday we examined how the political class in Washington is more interested in leveraging the Gulf oil spill to their political advantage rather than first stopping the leak and the damage it causes.

Today, we will look at a hodgepodge of screwed up government priorities from around the country, proving that the political class in Washington DC does not have a monopoly when it comes to irrational priorities. Many of the following examples come from the past two editions of Reason magazine ( and one comes from an Associated Press article. Since several of the following examples come from the state of California, keep in mind that the state government in California is facing about a $20 billion budget shortfall for the next budget cycle. This shortfall will likely result in draconian cuts to the number of state employees and state services. One would think that the political class in California would be focusing on streamlining their budget in order to make the budget cuts as painless as possible but...
  • The San Francisco city council recently passed an ordinance, as reported by an Associated Press article today, requiring cell phone vendors and retailers to publicly post a sign in their store that documents the amount of radiation that is given off by each of the phone models they sell. They are requiring this signage even though the industry trade association and a recently completed and major United Nations study both concluded that there is no radiation danger from using cell phones. So, the state is awash in red ink, many teachers, firefighters, and police in San Francisco and elsewhere in the state are likely to lose their jobs shortly across and the city council is actively working an issue that is likely not an issue. The pathetic thing about this ordinance is that 1) most people coming into the stores will probably not even notice the radiation sign (a phenomenon that occurred when NYC required restaurants to post the nutritional value of the meals served, most people in a follow up survey did not recall even seeing the sign, 2) those that see the sign will likely not read it (source: same restaurant study in NYC) and 3) people will still buy the phone they want based on price, features, style, and availability. The only losers in this scenario are the customers who somehow will end up paying for the unneeded radiation signs the stores are required to post but which will have no impact.
  • Staying in California, a car wash owner in Sacramento, Aaron Zeff, claimed that he was paid a visit by two, not one, IRS agents recently because he owed back taxes. The amount owed turned out to be $.04 from 2006. Zeff also claimed that this was the first time that the IRS told him of the shortfall, with my assumption being that he would have paid the back taxes if the IRS had sent him a letter rather than wasting hundreds if not thousands of dollars in salaries of two physical agents being dispatched to the field for a $.04 tax shortfall. Bernie Madoff gets away with the biggest Ponzi scheme for over a decade and the Federal government misses that one for so long but is right on top of delinquent car wash owners who owe $.04. (Source: Reason Magazine)
  • Lets stay in California, the home of the $20 billion budget gap. The Santa Clara county Board of Supervisors has worked on and passed a law that bans toys from being given away with any meal with over 485 calories. It also bans restaurants from giving away a toy with any meal that has more than 600 milligrams of salt. Shouldn't parents be the determining factor of what and where and what toys their kids get? As with San Francisco, I would have hope the Santa Clara county government would be working on ways to minimize the budget deficit impact on their citizens rather than playing dietitian to the population. If the state and county go bankrupt, who cares what the kids are eating, at least in the short term? (Source: Reason magazine)
  • In New Mexico, if state police troopers fail to write at least 100 tickets and make three DWI arrests each month, they face possible sanctions. The chief called it a "minimum performance standard" and not a quota. Shouldn't the New Mexico state police, or any police force, be more concerned with catching criminals, wherever they appear, rather than hunting down people to fill their "minimum performance standard?" Do New Mexico state police ignore other crimes towards the end of the month in order to fill their quota? One would think that the job of any police force is to stop crime wherever it occurs and not go looking for only certain types of criminals. (Source: Reason magazine)
  • Back to the Federal wing of the political class. In 2006, the U.S. government passed a law that basically made it unlawful to manage or run an online Internet betting process such as online poker. For four years no one had been arrested. This law made the U.S. the only major country in the world that outlawed the business of online gambling. Recently, a major operator of online gambling from Australia was arrested on a visit to Las Vegas and is charged with violating the anti-gambling law. Given that the Christmas Day underwear bomber almost blew up a plane over Detroit last December and the Times Square bomber almost blew up a bomb in New York recently, one would have hoped that the U.S. Attorney Generals and law enforcement across the nation would be working on those types of problems and not one of Internet gambling. Americans love to gamble and should be allowed to do it wherever they want, making the law itself a misplaced priority to begin with. To use law enforcement resources to execute the law when there are so many other dangers facing the country is just another example of a screwed up priority. (Source: Reason magazine)
  • The Utah state legislature is hard at work on a piece of legislation that will decriminalize the collection of rain water. Yes, it is a crime in Utah to collect the rain as it falls from the sky. The proposed new law would allow citizens to collect rainwater in underground tanks and barrels but... they would have to register their collection activities with the state and tell it how much water they collected. You cannot make this stuff up when it comes to screwed up government programs. (Source: Reason magazine)

Given what we have written about the past three days, please do not let anyone tell you that they cannot cut government spending anymore. Screwed up priorities such as the ones we have reviewed, government functions that do not do their jobs but draw a paycheck (e.g., the SEC employees who constantly searched the Internet for pornography during work hours while the economy crashed, the Federal oil rig safety employees that did the same Internet pornography searching while neglecting their safety inspection duties, government product safety employees that allowed lead and cadmium products to be imported into the country for use by kids and also allowed unsafe Toyota products into the market for years, etc.), and politicians that give away our money in return for campaign donations are just a short list of the many screwed up government priorities. When you are worried about having a government process for tracking the collection of rain water, you know we have fallen down the rabbit hole into another world, a world of screwed up priorities.

Again, that is why November is so critical to our nation and our pocket books. The current crop of politicians, at all levels of government, work on programs and projects that are really out of touch with reality and all incumbents that work on these issues need to be kicked out of office. They need to be replaced by new people with their heads screwed on straight in order to cut the waste, downsize government and get the remaining employees and government functions laser focused on real priorities that influence the most Americans lives.

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Monday, June 21, 2010

Screwed Up Government Priorities, Case #2 - "Meanwhile, oil continues to spew into the Gulf.."

Yesterday we discussed the first in a series of posts regarding how screwed up our government's priorities are. We saw that while the political class spends almost $16 billion a year in local earmarks for their local states and districts and to generate campaign funds for their re-election, the same political class spends only about $2 billion a year on cancer research, a set of diseases that kill hundreds of thousands of Americans every year. How screwed up is that priority: better to get re-elected then save American lives.

Meanwhile, oil continues to spew into the Gulf...

Today we will look at a second set of screwed up priorities, namely the whole situation with the BP oil spill disaster in the Gulf Of Mexico. As an upfront disclaimer, let me state that I find the actions of BP leading up to, during, and after the explosion on their oil rig to be shortsighted, despicable, and inadequate. They took short cuts and probably violated a number of Federal safety statues and laws. Over 60 days later they still have not plugged the leak and really have no other plan in place to stop it for at least another couple of months. They should be held accountable for the damage and safety violations to the fullest extent of current law.

Meanwhile, oil continues to spew into the Gulf...

Unfortunately, over the past week or so, the political class has gotten itself and their egos involved in the process. A White House meeting was held with Obama and his staff and the Chairman and CEO of BP. CEO Tony Hayward later went over to get beat up at Congressional hearings by Congress people that probably had no idea of what they were talking about except that it made them feel good in front of the cameras. And, there is no doubt that Hayward probably deserved some of the beat down since it is obvious that under his watch, BP was not prepared for what happened. However, rather than beat up the head of the cleanup, could we have not waited a little while to crucify him in public? Would not his time have been better spent working on the problem, the continuing spill, rather than jetting to DC? There is plenty of time to get a pound of flesh after the hole is plugged.

Meanwhile, the oil continues to spew into the Gulf...

Anyway, Mr. Hayward is not the only one who should be crucified because of this disaster. What about Interior Secretary Salazar. I would like to get him on the stand and ask him the following questions:
  • Mr. Secretary, the Associated Press has reported that an internal investigation has uncovered at least one of your employees responsible for oil rig safety has admitted that he used crystal meth and may have been under the influence the next day at work and that others have admitted to being users of illegal drugs. Did that have anything to do with safety laxity on your watch?
  • Mr. Secretary, the Associated Press has reported that an internal investigation has uncovered numerous occurrences where your employees received hunting and fishing trips and other gifts from the same companies that your department was supposed to be regulating and inspecting. Did that have anything to do with safety laxity on your watch?
  • Mr. Secretary, the Associated Press has reported that an internal investigation has uncovered numerous occurrences where your inspectors were actively inspecting oil company sites for safety at the same time they were negotiating for jobs at those very companies. Did that have anything to do with safety laxity on your watch?
  • Mr. Secretary, an Associated Press report mentions a 2008 report by the Interior department's inspector general that "decried a culture of ethical failure" and conflicts of interest at the responsible Interior agency. Did this culture have anything to do with the safety laxity on your watch and how have you addressed this problem?
  • Mr. Secretary, the Associated Press has reported that an internal investigation found that some local employees in your Lake Charles, La. office had a significant amount of pornography on their government computers. Did that have anything to do with safety laxity on your watch?
  • Mr. Secretary, the Associated Press has reported that your department conducted sixteen fewer safety inspections at the BP oil rig than it should have. Did that have anything to do with the safety laxity on your watch?
  • Mr.Secretary, the Associated Press has reported that safety regulation of the Gulf wells is so lax that "some key safety aspects on rigs are decided almost entirely by the companies doing the work." Did that have anything to do with the safety laxity on your watch?
  • Mr. Secretary, the Associated Press has reported that the overall BP safety plan and the safety plan specifically for the rig that exploded never had a chance of being successful, even on paper, and was riddled with inaccuracies, falsehoods, and inadequate preparation for the disaster. Who is responsible for such a lousy plan and document and will there be repercussions for those responsible?
Meanwhile, oil continues to spew into the Gulf...

Secretary Salazar is not he only person I would want to grill as an American citizen. I would allow Congressman Henry Waxman and Senator Jeff Bingaman, the chairman in Congress who chair committees on energy, to be put on the stand together for the following questions:
  • Gentlemen, given the myriad of failures discussed with Mr. Salazar above, how come your committees were so lax in their oversight of the energy safety issues on Gulf drilling rigs?
  • Gentlemen, given that your committees are responsible for Gulf drilling rigs, have either of you ever been on an oil rig?
  • Gentlemen, given that your committees are responsible for Gulf drilling rigs, are either of you familiar with the Federal safety regulations? I particularly address this to you, Mr. Waxman, since you have already admitted you have not read the entire Cap And Trade legislation even though you are a co-sponsor. Have either of you read the safety regulations of oil rigs?
  • Gentlemen, according to a recent Washington Post article that was summarized in the June 25, 2010 issue of The Week magazine, there are currently only 62 inspectors assigned to oversee 4,000 oil rigs in the Gulf of Mexico, or about one inspector for every 64 wells or so while in 1985 there were 55 inspectors for about 400 oil rigs or about one inspector for every seven or eight rigs. Do you accept some of this responsibility for underfunding the need to have more inspectors?
  • Gentlemen, Washington has been abuzz about energy and climate change legislation lately. Wouldn't it be wiser in the short term to worry about the continued leak than to focus on a long term energy/climate bill?
Meanwhile, oil continued to spill into the Gulf...

And finally, I would like to sit with President Obama and ask him a few questions:
  • Mr. President, you have proclaimed that you and your administration are on top of the situation but since the spill began it has been reported that you traveled to California three times for political fundraisers, played at least seven rounds of golf, took two vacations, participated in several photo ops with athletic teams, and did not meet with Hayward until about the eighth week of the crisis. Is that your definition of being on top of the situation?
  • Mr. President, Tony Hayward has taken a lot of heat this weekend because he took time off to attend a yacht race back in Europe. Should you have taken the same amount of heat for taking time off to go to a baseball game Friday night even though the oil leak continues?
  • Mr. President, will you prosecute, fine, fire, or take an disciplinary action against government employees who failed in their assigned duties to oversee and regulate the drilling activities in the Gulf?
  • Mr. President, why is it taking so long for local governments to get help and permission to stem the tide of oil that is washing over their shores? Why didn't the Army Corp. of Engineers have a contingency plan ready rather than deny permission for sand berms and other actions until they "studied" the implications? Shouldn't that study have been done prior to the disaster?
  • Mr. President, why have you not asked for a waiver of the Jones Act so that willing countries can donate their equipment to help with the clean up? Could it be you want to delay the clean up and prolong the problem in order to get the legislation passed that you want?
  • Rather than publicly browbeat the very people technically and logistically responsible for stopping the leak last week, would it have not been a better approach to lay off for just a little while and let them focus on stopping the leak and then bring them to Washington for your photo op and thrashing of BP, after the leak was stopped?
Meanwhile, oil continues to spew into the Gulf...

Let's face, this is a disaster of epic proportions. From BP's shortcuts to save a little money and time and flaunting of standard safety protocols to the inadequate Federal oversight and focus on not stopping the leak the leak at all costs, we have never seen anything so disgusting in our lives. And where are the government's priorities? Congressmen and women anxious to show their indignation on television when it was obvious most of them did not know what they a were talking about. Other politicians trying to get their favorite energy and environmental legislation passed while losing focus on the core problem: stop the darn leak. That should be the only priority right now. The TV grandstanding, the press conferences, the feigned indignation, working for passage of legislation, that can all wait under we stop the leak.

Meanwhile, oil continues to spew into the Gulf...

This is just another reason why term limits (Step 39 in "Love My Country, Loathe My Government") and ousting the incumbents in November is so important. Long time politicians get to comfortable in their positions and allow laxity to enter into their administering and governing. Regulations are passed but not enforced. Employees are hired but no trained or supervised properly. A crisis occurs and the political class looks at a way to leverage the disaster rather than fixing the disaster. Not only should the top management at BP be replaced but Salazar, Waxman, Bingaman, and all politicians sitting on the committees responsible for oversight of the Gulf drilling need to be removed from their committee and subcommittee posts (Step 34). In real life, if you screw up, there are consequences. Should be the same way in government. Allow an epic environmental disaster to occur on your watch, a disaster that was totally preventable, get removed from your committee post.

Meanwhile, oil continues to spew into the Gulf...

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Also visit the following sites for freedom:

Sunday, June 20, 2010

Screwed Up Government Priorities, Case #1 - Earmark Spending Vs. Cancer Research Spending

Today will start a series of at least two posts where I make a definitive statements of what I think are really screwed up Federal government priorities. These are not Democrat vs. Republican nuances in policy, these are just plain, stupid wasteful government and political class screw ups.

Let's start today with data from a Washington Post from article February 18, 2010. The article reports on an analysis by the organization, Taxpayers For Common Sense. They issued their annual report showing that in 2010 the Federal government will spend about $15.6 billion on over 10,000 Federal budget earmarks. Recall that earmarks are special funding buckets that sitting politicians can use to direct Federal taxpayer money to their home state or Congressional district for use on projects and initiatives in their state/district or are special buckets of money directed to all types of organizations (companies, non-profits, etc.) that usually, in turn, donate some of the organization's money to the politician's re-election campaign.

What are these buckets of money spent on? Anderson Cooper of CNN recently reported that the following efforts received earmark funding:
  • $200,000 for the Arkansas Commercial Driver Training Institute
  • $150,000 for educational programs at the Washington DC National Building Museum
  • $134,000 for the Montana Trade Center
  • $100,000 for the Myrtle Beach International Trade And Conference Center
  • $500,000 For exhibits at the National Mississippi River Museum and Aquarium In Iowa
  • $200,000 for the Washington (state) Opera
  • $150,000 for exhibits at the Teddy Roosevelt Inaugural Site
The website for Citizens Against Government Waste contains the following wasteful spending examples:
  • $1,000,000 to renovate the Portsmouth, New Hampshire Music Hall
  • $400,000 to renovate the Ritz Theater in New York
  • $350,000 to renovate the Uptown Theater in Philadelphia
  • $250,000 to construct the Monroe County Farmers' Market in Kentucky
  • $100,000 to construct the Santa Ana River Trail in California
  • $250,000 to renovate the Murphy Theater in Ohio
According to John McCain, the latest defense budget includes the following earmark buckets:
  • $500,000 for the Brown Snake Program (yes, this was in the Defense budget)
  • $1.800,000 to renovate the Fort Hamilton Community Club in New York
  • $5,000,000 for the Presido heritage in San Francisco
  • $1,600,000 for the Center For Space Entrepreneurship
  • $18,900,000 for a center :dedicated to educating the general public, students, teachers, new Senators and Senate staff about the role and importance of the Senate."

We could go on and on (about 10,000 more times) but you get the picture. Just these eighteen examples alone cost the American taxpayer almost $32 million, money that should have been spent but the state or local governments or the private sector. National taxpayers should not help finance a farmers' makret in Kentucky or a river trail in California. These are bribes, nothing more, to get voters to pony up money and votes to re-elect incumbents.

But what is really screwed up is the following information that was published in the June 20, 2010 issue of Parade magazine, "Government Research Funding For The Top 10 Cancer Killers in 2009." The following numbers come from the National Cancer Institute (NCI), the biggest Federal government research funder (Note: the article does point out that some other government agencies fund cancer research but the NCI is the largest):

  • Lung and Bronchus - $246.9 million funded by the NCI
  • Colon and Rectum - $264.2 million
  • Breast - $599.5 million
  • Pancreas - $89.7 million
  • Prostate - $293.9 million
  • Leukemia -- $220.6 million
  • Non-Hodgkin's Lymphoma - $130.9 million
  • Liver - $70.3 million
  • Ovary - $110,1 million
  • Esophagus - $28.8 million
  • Total = $2.037 billion

According to the article, 150,000 people are diagnosed with colorectal cancer every year and 50,000 people die from it. According to the American Cancer Society website, about 180,000 Americans are diagnosed with breast cancer every year and about 40,000 die from it. According to the National Cancer institute, about 220,000 new cases of lung cancer are diagnosed every year and about 157,000 Americans die from it.

Thus, if you take all of the above information, you get the following government and political class screw ups:

  • How come, as a country, we allow the political class to spend about 59 times more taxpayer money on earmarks and their re-election efforts than we do on colon cancer research ($15.6 BILLION spent on earmarks and $264.2 MILLION on colon cancer research?
  • How come, as a country, we allow the political class to spend about 26 times more taxpayer money on earmarks and their re-election efforts than we do on breast cancer research?
  • How come, as a country, we allow the political class to spend about 63 times more taxpayer money on earmarks and their re-election efforts than we do on lung cancer research?
  • How come, as a country, we allow the political class to spend $15.6 BILLION on earmarks to support their re-election efforts while almost 250,000 Americans die every year from just these three cancers?
  • How come, as a country, we allow the political class to spend $32 million on just the eighteen earmarks listed above when $32 million would represent an almost 50% increase in liver cancer research?
  • How come, as a country, we allow the political class to spend over seven times the amount of money in earmarks than we spend on the ten cancers listed above?
  • Does the political class really think that building a river trail or a farmer's market with Federal tax dollars is a better use of money than helping solve the cancer riddle?
  • While just about every family in America will be affected by cancer at some point in time, how many people will shop at the Monroe County Farmer's Market or will walk the Santa Ana River Trail?

This is what a call a prime example of screwed up government priorities. It gets back to the elitist discussion we have had in the past two posts where the politicians in this country put their interests first and whatever is left over is given back to the citizens. The political class sees their right to issue earmarks in the billions of dollars more important than to help many more Americans fight the battle against cancer. Spending billions for their own self good vs. spending millions for the betterment of the citizens is a major screw up in my opinion.

Three steps in "Love My Country, Loathe My Government" would address this situation. First, Step 39 would impose term limits on all Congressional seats so that the perceived need to issue earmarks in exchange for re-election donations would go away since there would be no re-election opportunities, one term and out. Step 4 would occur after the first three steps were executed, i.e. the drastic reduction in Federal government expenditures, and would direct some of those savings from reducing the size of government towards focused efforts to substantially reduce the dire cancer statistics facing the country. And finally, Step 44 would not allow any Federal funding on any project or program unless it was beneficial to a significant number of residents in at least five states. This step would eliminate the river trails and farmers market earmarks immediately.

Despite hollow calls for reducing earmarks over the years, the political class has shown they are addicted to them and the campaign donations that follow. If we eliminated all of the earmarks and gave half of the wasted money money back to the taxpayers, we could still increase cancer research funding by more than three fold if we saved the other half for research. That is the intent of Step 4 and should be intent of a benevolent government, not a screwed up government.

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. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

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