Corruption, Cronyism, Syria and Term Limits: Correlated of Causative?

As most informed Americans know, President Obama issued a dare/threat to the Syrian government in August, 2012, warning them not to use poison gas in their civil war against rebel forces. The President then proceeded to do nothing to operationalize that threat over the next twelve months, despite numerous and long vacations and many, many rounds of golf. He did not get Congressional approval to strike militarily if poison gas was used, he did not get United Nations approval to strike, he did not get the American public behind him, he did not pressure Syrian allies to force Syria not to use chemical weapons, nothing.

As a result, if reports are to be believed, the Syrian government did use poison gas on its people and the President is out on a very thin limb. He has now gone to Congress, twelve months too late, and is trying to get them out on the limb with him by authorizing a military strike on Syrian targets. Over the past week, Congressional hearings and meetings have been held to determine if Congress should give him this ill thought out and probably ill fated power to attack.

The first Congressional voted was held by a Senate responsible for such matters and a resolution passed, 10  votes for military action vs. 7 voted against military action. That resolution will now move along the Congressional process for a vote by the entire Senate. We have made the case this week, as have many other, smarter Americans why attacking Syria is a very bad idea. Those posts can be reviewed starting with the first one:

http://loathemygovernment.blogspot.com/2013/09/political-class-insanity-special.html

So, given that so many Americans are against military action, I wondered why a majority of Senators on this committee voted to support military action. Was there something going on behind the scenes that we are not aware of? Well, an analysis posted by the Wired magazine website provides a theory and hypothesis of what is really going on.

Before going on, a quick discussion on correlation and causation. Just because two factors look to be interrelated, it does not mean that one caused another. Simple example. I recently went on a diet and as my weight dropped, my golf game improved. On the surface, it looks like my weight loss made me a better golfer, or said another way, my weight loss caused my golf improvement.

But I also took some lessons and bought new golf clubs in the midst of my weight reduction effort. In all likelihood, the new clubs and lessons CAUSED my golf game improvement, while the weight loss was CORRELATED with the improvement in my golf game, it did not cause the improvement.

Okay, that is a long winded way of saying that just because defense and intelligence companies and contractors gave a lot more reelection campaign money to the Senators who voted yes to go to war does not necessarily mean that their money caused them to vote yes for war, it could just be a correlation or a coincidence. 

But it is a worthwhile avenue of investigation since we are talking about spending billions of dollars to attack Syria and putting our fighting service men and women in mortal danger. It would be a shame if those costs were incurred for a few thousands dollars of campaign contributions from companies that would profit handsomely from another Middle East military action.

The following graphic of how the “yes” voters got more money from defense contractors and companies vs. those that voted “no” to war is lifted from the Wired article (double click on the image for a larger view):








The data is based on campaign contributions from 2007 through 2012. The information comes form the fabulous Open Secrets website that tracks all money being donated to all politicians over the years and what was the source of those contributions.

For this analysis, these sources include political action committees and employees from defense and intelligence firms related to such companies as Lockheed Martin, Boeing, United Technologies, Honeywell International, and others. This category of contributors in the Open Secrets website gave $1,006,887 to the 17 members of the Senate Foreign Relations Committee who voted yes or no on the authorization Wednesday, The analysis and data research was done by Maplight, a Berkeley-based nonprofit that performed the inquiry at WIRED’s request.

Let’s review the findings and do a little math work of our own:

• Those Senators that voted yes for war on average received 83% more money from defense contractors than those that voted no to war.
• A majority of those Senators that voted no to war (four out of seven), received less money from defense contractors than the lowest recipient of funds among the ten Senators that voted yes to war.
• If you assume that McCain on the yes side and Barrasso on the no side are outliers which distort the results, removing these two highest paid recipients on each side of the issue and recalculating averages show even worse results, with the yes side getting about 92% more from defense firms than the no side.
• If you leave Barrasso in and just remove McCain, the results are still damning, with the yes voters getting on average 54% more than the no voters.
• The top three recipients of defense contributions on the yes side received, on average, 94% more than the top three recipients on the no side.

It is tough/impossible to cut the data anyway possible and not come away with the conclusions that those that voted yes to going to war with Syria were much better financially supported by defense firms, companies that would do very well in a war environment, than those Senators that voted no. Again, this does not mean that heavy financial support to the yes voters influenced their vote, remember correlation vs. causation. It could just be a coincidence that it ended up that way.

But who really believes that. Consider another viewpoint that again, could just be a correlation/coincidence and have nothing to do with going to war or not. In the past month, the stock market’s S&P index is down about 2.49% while the Dow industrial stock average is down even more, 3.83%. 

However, if you look at four major defense firms, firms listed above that are heavy contributors to Senators’ reelection campaigns, we see that the Lockheed stock price over the past month is down only .43%, Boeing’s stock price is down just .91%, United Technologies is down 1.87%, and Honeywell is down 2.97%. Thus, in general, defense firms have done much better than the overall stock market in the past month as war talk and attacking Syria talk has ramped up.

Again, the better than market performance of defense firms in the midst of Senate debate on going to war could just be a coincidence. But if war is your business and the potential for engaging in military action is on the table, than business can be very good, especially if you can influence the events via lobbying and campaign funding.

These facts and figures could all be just a coincidence. But why take the chance? Shouldn’t Congressional actions, decisions, and votes be based on the merits relative to the majority of American citizens and not based on how much money incumbent politicians can potentially sell their vote for? 

And if we are not talking about a coincidence, isn’t it a disgrace that just over a $1 million in campaign donations can risk billions of dollars in war supplies and the potential deaths of American troops and seamen and airmen?

That is why we need to remove the chance for causation by implementing two steps from “Love My Country, Loathe My Government:”

1) Step 7 would allow only American citizens to contribute to political campaigns. No companies, no unions, no PACs, no Super PACs, and no lobbyists would ever be allowed to contribute to any political election campaign. Washington politicians should be voting on issues as dictated by citizens, not defense firms or any other kind of organized entity.

2) Step 39 would impose term limits on all Washington politicians. We get into these difficult situations because the primary purpose of anyone serving in Congress is to continue serving in Congress, election after election after election. These perpetual elections require money from various sources. 

And with money comes debts that need to be paid back in order to get more reelection campaign funding. Make reelection impossible and that would certainly focus sitting politicians on the real issues, making the proper decisions since reelection and the need for reelection funding goes away.

If those ten Senators that voted yes to go to war, those ten that had received much more campaign money from defense firms than the seven no voters, knew that reelection was not possible, it would be interesting to see if they still would have voted yes. 

In any case, we need to remove this suspicion of acting for reelection rather than the safety of our country,  our taxpayer wealth, and the safety of our armed forces. You can help make that possible by joining our effort to impose term limits on all Washington politicians at:

www.howmuchworsecoulditget.com

Because, really, how much worse could it get when just over a $1 million could cost us much more in treasure and lives?

Our 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:

Term Limits Now:http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.robertringer.com/
http://www.youtube.com/watch?v=08j0sYUOb5w 

Economic Update - Part 4: Taxmageddon, Bank Runs, Bankrupt Students, and More

Okay, this time I really promise this will be the last post for a while regarding our nation's economic condition. I know I promised to stop talking about the situation yesterday but additional bad news continues to brought to my attention. I will cut off the news after today, and tomorrow I will present a series of ideas on what could and should be done to finally start turning the economy around in this country.

However, if I have not scared you enough about our financial and economic plight over the past three days, consider the following, additional bad news:

- In an article from http://www.theatlantic.com/, that was summarized in the May 25, 2012 issue of The Week magazine: "Europe is about to experience the mother of all bank runs. If Greece exits the Euro, depositors in Ireland, Portugal, Spain, and Italy will transfer their cash to safe countries like Germany. That capital flight will encourage international investors to start betting on a breakup, causing borrowing costs to soar and making the Euro's collapse even more likely."

- In that same issue of The Week magazine, a summary of an Associated Press article predicted that the pain of a Euro breakup would extend to the U.S. The article claims that Wall Street has trillions of dollars tied up in European banks, and it the Euro goes kaput, those American banks are likely to curtail their lending due to the resultant cash squeeze.

- Speaking of banks, an article that appeared at http://www.theatlantic.com/, which was summarized, you guessed it, in the May 25, 2012 issue of The Week magazine, reported that the five largest banks in the country control $8.5 TRILLION in assets, which is equivalent to about 56% of the nation's economy. These are both bigger numbers than in 2008 when the rallying cry "too big to fail" resulted in the despised, ineffective, and very expensive taxpayer funded bank bailouts.

Obviously, Washington and the political class never figured out how to make the big banks not be too big to fail. If the Euro crisis smacks these big banks, will the taxpayers put up with another round of bailouts for Wall Street? And if not, what would happen to our economy if one be of the big five goes down the tubes?

- A Huffington Post article that was also summarized in the May 25, 2012 issue of The Week, reported that less than half of the U.S. graduates since 2009 have found a job within a year of leaving school. Those in the other half that did find a job have an average starting salary of about $27,000, 10% lower than the graduating classes of 2006 and 2007.

- From that same issue of The Week (a busy week of bad economic news to appear in just one issue!), a summarized New York Times article reported that 94% of college students borrow money to pay for their education, double the percentage from twenty years ago. The heavy debt load their incur restricts their ability to buy cars, rent an apartment, and conduct other economy growing activities due to the diversion of their income to paying off their debt.

- A recent Gallup poll, reported int he May 18, 2012 issue of The Week magazine, found that Americans' "personal financial comfort" is at the lowest level since Gallup began tracking the measure ten years ago. 39% of those polled said they do not have enough money to live comfortably, up from 34% last year and 24% in 2002.

- A recent Associated Press article reported that the Organization For Economic Cooperation and Development warned the 17 countries in the Euro zone that they risked falling into a severe recession, and bringing the rest of the world into a recession with them, unless more was done to stem the debt crisis.

- We have already talked about the so-called "taxmageddon," the economic doomsday scenario that will occur in early 2013 unless the political class can get together beforehand and agree on how to effectively handle a multitude of tax issues and spending issues beforehand.

According to a recent Washington Post article (and it too was summarized in the May 25, 2012 issue of The Week magazine), the lack of leadership and effective planning from Washington is resulting in defense contractors already slowing their hiring plans and hospitals cutting costs in anticipation of the end of year deadline. Neither of these actions, and probably thousands of other,similar  actions by thousands of companies across hundreds of industries, will help the state of the economy in 2012.

- And one last blast of bad, the Dow Jones Industrial Average closed last Friday down over 9% from its 52 week high. I believe that we are considered in a bear stock market environment when the market drops more than 20% below is annual high. Thus, we are almost half way to a bear market and the trend is not good.

Really scary stuff. That is why we wanted to get all of the bad news out so that people would begin to realize how dangerous a time we are in from a debt, financial, and economic perspective. Starting tomorrow, and probably going for at least two days, we will present our recommendations for getting this situation under control and moving forward in a positive direction.

It is obvious that the political class in Washington has no clue on what to do. Otherwise, I would have thought they would have done it already and we would not be in this economic death spiral. The information shared over the past three days should be reason enough to 1) dump out all incumbents in November, from the President through the first term members of Congress, 2) start the process of implementing term limits, and 3) start the implementation of the economic salvation plan we will propose in the next few days.

I will leave you with two quotes to ponder in the light of the dire economic news we have shared over the past four posts:

Albert Einstein: "The definition of insanity is doing the same thing over and over again and expecting different results." We have continually allowed the same tired politicians with the same tired ideas to continually get reelected. As a result, we find ourselves in the dire economic straits we are in today.

The second quote comes from Eric Bonse, writing for the German publication, Die Tagezeitung. Mr. Bonse summarized the recent meeting of the leaders from Canada, Russia, France, Germany, Italy, Japan, the U.K. and the U.S. who got together at Camp David in mid-May to try and figure out how to fix the broken economies around the world. Mr. Bonse found Barack Obama to be "a fine host" but not much of a leader or facilitator.

The outcome form the meeting resulted in only a tepid statement that all of the leaders were "in favor of growth." That's about as deep, inspiring, and effective as saying I would rather have a cupcake than a root canal. But Mr; Bonse had a much better observation: "Which proves that they don't have the slightest idea how to get about solving the Euro crisis. The summit produced on a general sense of bewilderment." Well said.


We invite all readers of this blog to visit our new website, "The United States Of Purple," at

http://www.unitedstatesofpurple.com/

The United States of Purple is a new grass roots approach to filling the office of President of The United States by focusing on the restoration of freedom in the United States, focusing on problem solving skills and results vs. personal political enrichment, and imposing term limits on all future Federal politicians. No more red states, no more blue states, just one United States Of America under the banner of Purple.

The United States Of Purple's website also provides you the formal opportunity to sign a petition to begin the process of implementing a Constitutional amendment to impose fixed term limits on all Federally elected politicians. Only by turning out the existing political class can we have a chance of addressing and finally resolving the major issues of or times.

Our 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://realpolichick.blogspot.com/
http://www.flipcongress2010.com/
http://www.reason.com/
http://www.repealamendment/

Dissed By The Debt Ceiling Fiasco

Just when you thought the American political class could not stoop any lower or act any more in incompetently, along comes the debt ceiling crisis and we are all amazed that again, the political class has failed to exceed any standards of quality performance. And, as always, its the citizens of this country and the nation itself that gets dissed and abused. Getting "dissed" is certainly the right word when you consider the following apt adjectives to describe this fiasco:

Disallusioning - The characters in the White House and Congress out did themselves when it came to embarrassing themselves and the nation in the eyes of the world. The whole process was so disillusioning when viewed from a problem solving process since there was no process. There was no plan, there was no analysis, there was just a chaotic lurching towards the eventual deal.

How can you think you can competently run a country with over 300 million people, a massive government bureaucracy, and an economy worth over $14 TRILLION when you cannot even maturely and intelligently address a singular budget issue? So disillusioning.

Disgusting - There are many people in this country that honestly and intelligently believe that the national debt crisis is one of the few issues in our country's history that has a credible chance of destroying our nation, our democracy, and our future. Many of them made their concerns known by voting for and electing dozens and dozens of people to the House Of Representatives last November to represent their heartfelt fears and concerns. This is their right and duty as American citizens living in a democratic nation.

And how were their elected House Representatives treated when the debt ceiling debate was raging? Senate Majority Leader Harry Reid publicly called those who opposed a meager early version of the debt ceiling deal "extremists." House Minority Leader Nancy Pelosi publicly told John Boehner to act like an adult after a meeting at the White House. In a Democratic party meeting, Congressman Mike Doyle accused those in favor of getting out-of-control government spend under control "terrorists: "We have negotiated with terrorists. This small group of terrorists have made it impossible to spend any money." Isn't that what one should do if one was spending way too much? Pretty simple concept, Congressman Doyle.

These attitudes are disgusting and despicable on any number of levels. While Reid, Pelosi, people like Doyle, and Obama have been in charge of the White House and Congress, they have incurred over $5 TRILLION worth of national debt and we have nothing to show for it. $5 TRILLION is extremist by any measure of spending, whether it is total spending or out-of-control spending as a percentage of the nation's GDP. I contend their extreme damage to our national debt and economy, under their watch, make these people the real extremists and certainly not adults. Adults would have done a much better budget management job than the job Pelosi and Reid did.

And the worst name calling was by Doyle. To associate House members, who are representing their constituents to the best of their ability, with terrorists that murder, torture, and terrorize innocent people is the lowest of low when it comes to political rhetoric. It has absolutely no place in any kind of adult political discussion. It contributes nothing to a viable solution to any of our problems and certainly did not contribute anything positive to this meager debt ceiling deal. Disgusting.

[Side notes to the "terrorist" statement. Numerous news reports, quoting several sources (i.e. more than one source) who were actually in that meeting, concur that Vice President Joe Biden also contributed ot the "terrorist" language,  reportedly stating that these House Of Representative members  "have acted like terrorists." Several days after the reports, Biden's office denied that he mentioned anything like these words, despite the observation of several at the meeting. For the first time in his tenure in the White House, Obama spoke out and chided those that carelessly toss around words like "terrorists." Doyle does not deny he stated the characterization. Thus, there are conflicting stories of whether or not the Vice President stooped as low as Doyle.]

Dismal - Despite the teeth gnashing, the embarrassment of the country in the worlds' eyes, the inability to execute a credible problem solving process, and the degeneration of the Democratic Party leaders into kindergarten level name callers, the end product of the fiasco is not much better than dismal. The agreement calls for the Federal government to reduce out-of-control spending by about $2.5 TRILLION over the next ten years.

However, let's do a little math:

• The current Federal government national debt level is about $14.3 TRILLION.
• Obama's long range budget, that he submitted in the spring, called for the Federal government to add an additional $9 TRILLION to the national debt level.
• Thus, without changes to the Obama's long term budget plan, the national debt is estimated to grow to over $23 TRILLION in the next ten years, the equivalent of over $200,000 per U.S. household.
• This meager debt ceiling agreement would theoretically reduce the country's national debt to $20.5 TRILLION or about $178,000 per household.

Obviously, either number, with or without this settlement, is a dismal disaster for America and for America's families. The country will not be able to handle such massive debt no matter how much Obama wants to tax the rich and close tax loopholes. The numbers, even with this agreement, are still overwhelming despite any "solutions" the White House has proposed. Dismal.

Disappointing - Despite all of the ugliness that was incurred during the past few weeks, it probably will not make any difference when it comes to the dreaded downgrading of America's debt rating by the major credit agencies:

1) Last week in a Bloomberg News report, Standard and Poor's (S&P) chairman, John Chambers, issued a video that stated how much the political class needed to reduce government spending: "$4 TRILLION wold be a good down payment. A grand bargain of that nature would signal the seriousness of policy makers to address the fiscal situation in the U.S." In other words, the $2.5 TRILLION that was agreed to is not even a good down payment on debt reduction in the eyes of a major credit ratings agency.

S&P has given a top rated AAA ranking to U.S. government debt since 1941, through world wars, smaller wars, recessions, and various political antics in the White House and Congress. But the current set of politicians may be able to do what all other politicians before them could not do: get U.S. debt downgraded.

Chambers went on to say that "The $4 TRILLION, depending on whether it's front loaded or back loaded, is not going to do the trick in terms of stabilizing the U.S. government debt to GDP ratio. But it takes you pretty far along."

2) One of the most respected investors in the country, Pimco Co-Chairman Bill Gross, has publicly stated that the deal will not eliminate the danger of a credit ratings downgrade: "Eventually there's a downgrade coming, it just depends on Moody's, S&P, and Fitch and they're very slow moving."

Gross went on to state the obvious: the total, unfunded liabilities of the United States, Social Security, Medicare, and Medicaid, puts the country among the most debt-laden countries int he world. He feels that the debt load and crisis has had negative impacts on the country's economic growth, interest rates, and financial markets.

3) Bill Nuti, who is the CEO of NCR, warns that: "a downgrade to the U.S. credit rating will have widespread deleterious effects. Our economy will transition from a slow growth scenario to a no growth scenario and we could likely find ourselves in a double dip recession."

4) One would have thought that once the debt ceiling agreement was signed and some uncertainty from the world removed that the stock market would respond favorably. However, that is not what happened:

• The day after the agreement was signed, the Dow Jones Industrial Average was down well over 200 points, down 2.2%. The Dow is down 6.7% in just the past eight days.
• Every one of the companies in the Dow Industrials average was down the day after the signing.
• The S&P 500 dropped 2.6% after the signing while the NASDAQ was down 2.7% in one day. The Russell 2000 index of small businesses was down 3.3%.

4) The price of an ounce of gold went up 1.4% to $1645 an ounce on news that the agreement had been signed while domestic stock prices dropped substantially.

Thus, the people that depend on knowing and understanding the econcomy and financial markets have shown their disdain for the agreement by fleeing the domestic stock market for other, safer investment options. Disappointing.

Disillusioning, disgusting, disappointing, and dismal, no mater how you cut it, we have been dissed by the debt ceiling situation, the debt ceiling childish name calling, and the final debt ceiling agreement. While this agreement has slowed down the row boat as it heads for the waterfalls, it has not stopped the forward progress towards those fatal falls.

Much work still has to be done and if the childish, immature, cowardly, and shallow behavior and analysis of the political class that was exhibited during the past few weeks is any indication of future behavior, we are still in critical condition. As a result, tomorrow we will take a look at a detailed way to reduce government spending, not by a meager $2.5 TRILLION, but by three or four times that much without fear mongering like Obama has done over the past month. I believe that the Federal government can get its financial house in order without starving the poor, bankrupting the needy, and leaving the country defenseless.

No more dissing, let's start respecting and problem solving before  a much larger financial and economic fiasco envelopes the whole country. That would be the ultimate DIS.



Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at http://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.loathemygovernment.com/
http://www.cato.org/
http://www.robertringer.com/
http://realpolichick.blogspot.com/
http://www.flipcongress2010.com/
http://www.reason.com/
http://www.repealamendment.com/