Speak Out Against The Madness Of Irritating, Aggravating, And Possibly Illegal Antics Of The American Political Class

Mid-term elections are coming up and the mudslinging has been building for a while now. Never mind that we do not talk issues and solutions any more during campaign season, just name calling and sleazy behavior. In this spirit of sleaze, today's post is dedicated to an eclectic set of less than honorable situations that the American political class is involved in that are irritating, aggravating, and possibly illegal: 

• An October 14, 2010 Associated Press article covered how the largest Medicare fraud scam had recently been uncovered and shut down. According to the article, Armenian gangsters, not even American gangsters, used fake health care clinics and other methods to defraud the Medicare fund of $163 million. 73 people were arrested throughout the country. The article states that the "scope and sophistication puts the traditional Mafia to shame." Law enforcement officials labeled  the head of the fraud operation as roughly equivalent to a traditional godfather of crime. Some of the group's undoings were instances where eye doctors filed claims for bladder tests, ear, nose and throat specialists performed pregnancy ultrasound tests, and  a dermatologist billed Medicare for heart exams. The aggravating thing about this situation is why was it was this operation not shut down sooner?  Why did it take so long, which allowed millions of taxpayer dollars to be sent out, before someone, somewhere realized that a dermatologist should not be doing heart exams? The scarier aspect of this bust is that these were Armenian gangsters. I am assuming that the Russian mob in this country are also involved in similar fraud operations, that some of the larger gangs in the country are involved, etc. When will they get shut down? And finally, the real depressing aspect is that while this is the largest operation ever uncovered for this type of fraud, it represents less than .2% of the overall suspected Medicare fraud. Nice effort, but still a long way to go. Unless much larger and more numerous shutdowns like this occur, when Obama Care kicks in you will see fraud numbers like you have never seen before.
• According to a short article in the October 8, 2010 issue of The Week magazine, another small town Mexican mayor was killed, supposedly by drug traffickers. He was stoned to death. and was the fifth Mexican mayor murdered in six weeks in drug cartel violence.. He was mayor only because the former mayor and city council resigned after the town's city council leader had also been killed. Also, an American was recently killed when he and his wife came under attack while jet skiing on a lake that separates Texas and Mexico. One of the Mexican investigators following up on the killing was also killed. We are facing unprecedented violence just south of our border as a result of our faulty drug policies and laws and no one in the political class seems to care. What will it take besides a dead American on vacation to sit up and realize that sooner or later this dreadful violence is going to come across the border?
• According to a Wall Street Journal report that was printed in the October 22, 2010 issue of The Week magazine, at least six dozen Congressional aides bought or sold shares in companies their bosses oversee. One aide invested in Bank Of America shares after he found out in advance that the bank had passed its so-called "stress test." The aggravating aspect of this situation, according to the article, is that this behavior is not illegal. Political class members and their staffs can legally trade on nonpublic information they learn on their jobs. Any other American doing this would go to jail for insider trading. Talk about irritating hypocrisy.
• In that same issue of The Week, a Washington Monthly article reviewed how one Senator, Alabama Senator Richard Shelby, was holding up the nomination of Peter Diamond to a Federal Reserve Board seat because Shelby does not  think he is qualified. This resistance is despite the fact that Diamond just won the Nobel prize for economics earlier this month. I am not necessarily mad at Shelby and I do not know whether Diamond is qualified (although the Nobel prize should carry some weight). I am aggravated that we allow one person in a country of over 300 million people to hold up legislation and appointments via antiquated Senate rules and courtesies. If Shelby has a problem, let him speak out and then vote  yes or no. Don't stop the process by allowing a single individual to be a road block to legislation or appointments.
• According to an article in the  October 22, 2010 issue of The Week Magazine, a Washington Post article reported that as part of Obama's stimulus plan, the Social Security Administration sent out 89,000 checks for $250 each to people who were dead or in jail. The prisoners, while not entitled to the checks, will be allowed to keep the money. There's another $22,650,000 of taxpayer money down the drain. A few irritating questions for the political class: how many teachers could that money have paid for, how many meals for the homeless could that money have paid for, how many vaccinations for the poor could that money have paid for, and most importantly, how many Social Security employees got fired as a result of this incompetence? Unfortunately, those politicians sitting on the Congressional committees that should have oversaw and prevented this waste get to continue in their committee seats, just another reward for their incompetence.
• President Obama and the rest of the Federal level Democrats are constantly harping on the fact that if they had not risked hundreds of billions of taxpayer dollars in the bail out of the banks back in 2008, the banking system would have collapsed and led to a world wide economic depression. However, we have already reported in this blog that many of the banks returned their bailout money within six months of receiving it, indicating that maybe things were not so dire as we were led to believe. A bank probably cannot go from the brink of extinction to the picture of health in a few short months just because they received bailout money. The more likely scenario is that the banks saw a free lunch that they sat down to eat, only to find out that the lunch came with a bunch of conditions, including limits on executive pay, that made banks give back the money as soon as possible. Furthermore, we now learn from a Wall Street Journal article that appeared in the October 8, 2010 issue of The Week magazine, only 279 U.S. banks have actually failed since 2008. According to my research, there are currently 8,430 FDIC insured banks in the country, over 9,500 credit unions in the country, and other banks that are not FDIC insured. If you divide the number of banks that failed by the total number of banks in the country, you see that only 3.3% of the banks have failed in the past two years. The number goes down to 1.6% if you include the number of credit unions that surely picked up some of the slack when these 279 banks went under. The article goes on to point out that another 829 banks are at risk of failure. If you assume worse case, i.e. that all of these banks fail, you are still only looking at 13% of all banks and 6% of all financial institutions including credit unions. Thus, this charade that we were on the brink of a banking catastrophe is hogwash. There would have been enough banks, along with the FDIC, to provide consumer protection and other financial options if this small percentage of banks had failed or do actually fail. It is so aggravating that the political class constantly assumes we are too dumb to do the math in these types of situations.
• A recent blurb in the Organic Gardening and Farming magazine was recently brought to my attention. The magazine recently reported that total U.S. energy consumption in 1973 was 75.7 quadrillion BTUs. That has now grown to 101.6 quadrillion BTUs, a 34% increase. Our energy imports since 1973 have gone up a whopping 137%. The article failed to point out that since 1973, the American political class has come up with exactly zero effective national energy policies and strategies, leaving us ever more dependent on carbon based fuels and tenuous foreign sources of energy. Very aggravating and frustrating.
• According to a recent Business Week article, nine years after we militarily entered Afghanistan, we have yet to capture Bin Laden (the original intent of the occupation), we have allowed the Taliban to regroup and dominate southern Afghanistan, we are supporting a corrupt and ineffective central government, if we were to leave tomorrow the Taliban would likely prevail and come into power again, we have suffered almost 10,000 dead and wounded service men and women, and we have spent over $400 billion in military and reconstruction dollars. This waste of time, energy, lives, and money goes far beyond irritating and aggravating, it enters the realm of disgusting. So much cost and so little to show for it. And rather than finding a doable and intelligent solution and an end to the insanity, Obama mostly cares about not "losing the Democratic party," i.e. politics trumps our troops safety and our investment of time and dollars.

The political class never stops irritating and aggravating us and possibly involving themselves in unethical and criminal behavior (we did not even bring up the alleged improprieties of Charles Rangel and Maxine Walters). We need to find a way to break away from the same myopic and unoriginal thinkers we constantly resend to Congress and elect people who are innovative, hard working and ethical. Many of the steps needed to begin this journey out of our current national rut are outlined in "Love My Country, Loathe My government:"

• Step 5 - aggressively step up the investigation of fraud and criminal activity as it relates to all government programs to stop the leaking of hundreds of billions of dollars year that eventually end up in the hands of criminal enterprises.
• Step 14 - stop the gerrymandering of Congressional districts that have been used to virtually assure the re-election of incumbents in the past.
• Step 26 - convene a panel of drug experts from various fields to finally come up with a coherent national drug policy and strategy that helps with addiction, minimizes the criminal aspect of illegal drugs, and helps to destroy the Mexican drug cartels and their related violence.
• Steps 23, 24, 25 - implement these three steps to finally come up with a coherent and doable national energy policy that is environmentally friendly and relieves our dependence on foreign energy sources.
• Step 34 - remove politicians from their committee posts if they do not properly oversee or perform their jobs over the areas of government they are responsible for, e.g. those committee members sitting on the Social Security committees that missed the snafu of sending taxpayer money to prisoners ands dead people, should lose their committee posts.
• Step 39 - institute term limits so that we can regularly get rid of the aggravating, irritating, and criminal people that are always seem to get re-elected.

Speak out against the madness, as Crosby, Stills and Nash once sang. Stop the irritations, the aggravations, and the illegal activities of our current, low performing crop of politicians. 


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 www.loathemygovernment.com. 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.

Please visit the following sites for freedom:

http://www.cato.org
http://www.robertringer.com
http://www.realpolichick.blogspot.com/
http://www.flipcongress2010.com/
http://www.reason.com

Why The Economic Stimulus Plan Was A Taxpayer Failure But A Political Class Success

Yesterday we made the case that the TARP program to save the world's financial system was basically an expense failure for taxpayers but provided a successful new source of campaign slush funds to keep incumbent politicians in office. Today we will look at some aspects of Obama's economic stimulus program and see if the American taxpayer got their money's worth in this government program:

• The easiest analysis of the stimulus program is to just look at what the administration claimed would happen if we did not pass the program. Their claim was that, without the economic stimulus, unemployment could rise as high as 8%. Well, Congress did pass the stimulus program and unemployment has been stuck between 9.5% and 10% for who knows how long, with no immediate prospects for it getting anywhere close to the upper limit the administration says it would hit WITHOUT the stimulus spending. No matter how you cut it or how many times Pelosi blames the Bush administration, the stimulus program has been a bust when measured against the parameters that the Obama administration put forth. Oh, and by the way, while I am certainly no fan of Bush, the Democrats have controlled the purse strings and economic policy for the past three and a half years in Congress so Pelosi's recent blaming of the Bush administration for the economic doldrums in the country ring hollow, given she and the Democrats have been running Congress since 2006 and the White House since early 2009.
• In late October, 2009, about a year after the stimulus program took effect, the Associated Press ran an article by Matt Arizzo and Brett Blackledge that reported the Obama's administration claim that the stimulus program had created or saved about 640,000 jobs. At the same time, propublica.com's analysis estimated that at that same time, about $183 billion of stimulus money had been spent. [Note: Reason magazine estimated that by the end of 2009, the administration would have spent almost $200 billion of the stimulus money, indicating that the propublica.com estimate was probably a good estimate for late October, 2009]. If we do the simple calculation of dividing the Obama administration's number of jobs created/saved (640,000) into the amount of taxpayer money spent up to that point, we see that each job created or saved cost about $286,000, or more than four times what the typical American household earns in one year. Thus, we could have created four typical earning American household jobs if we could have theoretically just written four checks out of the $286,000. Instead, we as taxpayers only got one job for each $286,000 spent. inefficient, wasteful, and a failure, from a taxpayer perspective.
• Also in late 2009, the Associated Press ran another article concerning the stimulus, this one covering bridge construction and repair. One of the selling points of the stimulus program is that it would have a twofold effect relative to infrastructure jobs: it would create construction jobs and those jobs would fix our nation's crumbling infrastructure which would better serve the nation and the economy once things got back to normal. Unfortunately, the Associated Press investigation found that of the 2,200 or so bridges fixed under the stimulus program, about half of them were perfectly fine and needed no repair or construction work. It is pretty obvious what happened. Politicians in power were able to direct stimulus construction funds to their home districts or states even if the money could be better spent elsewhere on bridges that really were dilapidated and falling apart. Thus, rather than get an efficiently fixed infrastructure, we created phony work to fix things that were not broke, basically paying twice as much in taxpayer money to get the benefit.
• Two Republican Senators have issued a report that highlights, in their minds, the 100 worse uses of stimulus money. I will just go through the first five today, it gets pretty depressing after reading about five:

1. Almost $550,000 of stimulus funds were spent to replace windows in a Forest Service visitor's center at Mt. Saint Helen's. One might think this is a good thing except for the fact that the center has been closed down since 2007 and there are no immediate plans to reopen it since the Forest Service believes it has enough facilities for visitors already in place. As we have said many times in this blog, government does not create jobs, it creates work when it comes to stimulus spending. Once those windows were needlessly replaced, the jobs disappeared. Short term work was created, a long term job was not.
2. About $762,000 of stimulus funds were spent at the University of North Carolina to develop a computerized choreography program that the recipients of the funds hope will lead to a Dance version of YouTube. How this creates a long term, sustaining job is a mystery. If the market needed a computer program to develop a Dance version of YouTube, someone would have stepped forward with the venture capital funding.
3. About $62 million of stimulus funds were earmarked for the city of Pittsburgh to extend its light rail system under the Allegheny River and connect to a river casino and two professional sports complexes. This money was allocated despite the fact that the Pennsylvania governor called the rail connection a waste of money, the local Pittsburgh paper called it the tunnel to nowhere, and earlier attempts to build the tunnel were met with severe cost overruns. Talk about throwing good taxpayer money after a bad idea.
4. About $1.2 million of stimulus funds were earmarked to convert an abandoned train station, on a dead train line, into a museum in Glassboro, New Jersey. The train station closed almost forty years ago and is currently boarded up and covered in graffiti. it has no windows, they have been replaced with plywood, it has not immediate parking or landscaping, and if you see the picture, it cannot be more than 20 by 30 feet big. As with Pittsburgh, if Glassboro wants to create a museum, or Pittsburgh wants to build a light rail tunnel, then let that town fund it, not the Federal taxpayer. Creating a museum in dinghy, small, obsolete rundown building has nothing to do with creating an economy that can self generate long lasting jobs.
5. About $1.9 million of stimulus money was sent to the California Academy of Sciences to research ants in the southwest Indian Ocean and east Africa. The money would be used to capture, photograph, and analyze exotic ants. This one is so ridiculous from a job creation perspective, I cannot even come up with anything witty to say.

So where are we? A stimulus program that does not even come close to the parameters that its creators laid out, inefficient and redundant use of money to fix things that were not broken, job creation costs that are astronomical and inefficient, and money wasted on projects for dance computer programs, cataloging of ants, and building a tunnel to nowhere. Thus, it is obvious that the taxpayer loses again, just like we did under TARP.

And who wins under the stimulus program? Of course, it is our political class. Politicians were able to divide up the stimulus money and send it to places that did not need it or spent it on things that are totally inane, all in the pursuit of getting re-elected, i.e. showing how they brought back tax dollars to the home state or district and they need to be kept in office. In the meantime, 14 million Americans are still out of work but we know a whole lot more about ants in the Indian Ocean.

Let's assume that the American taxpayer put out about $1.5 TRILLION for both TARP and the stimulus program (remember, government pays for nothing, at some point in time the American citizenry pays for government expenses). If that money had been spread out to every American household, each household would have had about $13,000 in their pocket. $13,000 they could have used to pay their mortgage and stay out of foreclosure, $13,000 they could have used to help buy a new car, stimulating the auto industry, $13,000 they could have spent at restaurants, amusement parks, on cell phones, etc. which would have more efficiently stimulated the economy from the ground up. This would have been a much better use of our money, we could live without a Dance version of YouTube or windows in a closed visitor's center, if we had our own stimulus money to spend.

We lose, they win again. That is why two steps from "Love My Country, Loathe My Government" are so critical to this country going forward. Obviously, Step 39 is important since it would impose term limits on our Federal politicians and eliminate the need for them to constantly steal from the public treasury to enhance their re-election chances. Second, we need to implement Step 44 which would prohibit the expenditure of Federal funds on any project or program unless it significantly affected the residents of at least five states. Anything short of that threshold would be funded by the affected states or not done at all. The Federal government has no business in creating a museum in a dump in Glassboro, and certainly cannot claim that such a waste is helping to create jobs.


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 www.loathemygovernment.com. 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:

http://www.cato.org/
http://www.reason.com/
http://www.robertringer.com/
http://www.realpolichick.blogspot.com/
http://www.flipcongress2010.com/

While The Financial Markets Collapsed the SEC....Watched Pornography

Yesterday we touched on the issue of trust and how a recent Pew survey showed how the majority of Americans (about four out of five) do not trust the Federal government to fix any problems. On the heels of that revelation comes a Daniel Wagner Associated Press article on April 23, 2010, "SEC Staffers Watched Porn As Economy Crashed." The article summarized the results from the Security and Exchange Commission's (SEC) own inspector general and included the following findings from the inspector general's investigation:

• The investigation launched 33 different probes of SEC employees looking at pornographic images in the past five years.
• Thirty one of those probes occurred in the past two and half years, covering the time that the financial system nearly crashed and which led to the "Great Recession."
• The investigation concluded that some SEC staff people violated government ethics rules.
• A senior lawyer spent up to eight hours a day looking at and downloading pornography off of the Web, moving the images to discs after filling up the hard drive of his government computer with the downloads.
• An SEC accountant was blocked 16,000 times in a month from accessing pornographic websites. However, he found a way to get around the blocks in order to view pornography from work. If you assume he worked about 22 days a month and eight hours a day (176 hours a month) then, on average, he tried to access pornographic websites more than 90 times an hour.
• Seventeen of the investigated employees were termed to be at the "senior level," earning salaries up to over $222,400.

Let's review. the economy is crashing, banks and other financial institutions are collapsing, stock prices are plummeting and more than a few high ranking government employees, who are supposed to be responsible for watching dogging the U.S. financial system, are spending a substantial amount of their work day using their government, taxpayer funded computers to watch pornography. Maybe now the other 20% from the Pew survey who actually trust the Federal government will better understand while the majority of us do not.

The first scary thing is that this is just the SEC. I would assume that this problem is not just confined to SEC personnel, imagine how many other times across the full spectrum of government organizations that this type of wasteful behavior is going on. The second scary thing about this whole affair is that it is just another instance of government and the political class violating the trust that Americans place in their government institutions. How can we believe anything any politician says or believe any legislation that is passed will actually work when we hear stories like this? And when trust in your leaders goes away, faith in the entire concept of our government structure starts to erode away.

That is why several steps from "Love My Country, Loathe My Government" are so vital to implement as soon as possible. Step 1 called for a program that would annually reduce the budget of the Federal government 10% a year for five years. Critical to the success of that Step is a zero based, ground up approach to the entire organizational structure of the Federal government including interrelationships within that government organizational structure, the functions that are performed and the programs that are supported Hopefully, this approach would weed out this type of behavior, resulting in fired employees, smaller budgets, smaller government,and more effectiveness from the reformed, more nimble organizations that are created. No one can ever convince me today that there is not a tremendous amount of waste in the Federal government and this is just one prime example of wasteful use of taxpayer money. There is likely untold billions of dollars in savings by ferreting out these types of behaviors.

The second step would be Step 34 which would remove all Senate and House politicians that were sitting on Congressional committees and subcommittees that had SEC oversight responsibility. It is not enough to be a politicians and be outraged at this behavior after the fact. They should have been more involved and should bear some responsibility for this SEC scandal and Step 34 would ensure that happened by removing them from their committee posts.

I would hope that the first small steps to rebuild some trust between the government and the people it is supposed to serve, American citizens, would be to fire all of those involved at the SEC who have been proven to be wasting taxpayer time and resources on pornography. Without accountability their can be no trust.



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 www.loathemygovernment.com. 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.