Saturday, February 07, 2009


Thomas Jefferson was a US Founding Father. He drafted the Declaration of Independence and served as the 3rd US President.

[edited] We must not let our rulers load us with perpetual debt. We must choose between economy and liberty or profusion and servitude.

If we run into such debt, that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our calling and our creeds, then we will have no time to think, and no means of calling our miss-managers to account. We would then be glad to obtain subsistence by hiring ourselves to rivet their chains onto the necks of our fellow-sufferers.

Ten Pounds Of Manure

The stimulus bill has failed. Barack Obama has failed. The Trojan Horse of Hope and Change crashed into the guardrail of reality, revealing an army of ideologues and activists inside.

Now, before I continue, let me say that Barack Obama will still be popular, he will still get things done, and he will declare victory after signing a stimulus bill.

But Obama’s moment is gone, and politics is about nothing if not moments.

The stimulus bill was a bridge too far, an overplayed hand, ten pounds of manure in a five-pound bag. The legislation’s primary duty was never to stimulate the economy, but to stimulate the growth of government, the scope of the state.

By spending hundreds of billions on things that have absolutely nothing to do with providing an immediate stimulus for the economy, Democrats hoped to make a down payment on their dream government.

Reverse Alinsky?

TigerHawk knows what he's talking about. He's on to what terrifies Obama & Co. more than anything; namely, that Saul Alinsky's rules will be applied against THEM by their opponents. Indeed, to a certain extent, this is already happening:

1. "Power is not only what you have, but what the enemy thinks you have."

2. "Never go outside the expertise of your people."

3. "Whenever possible, go outside the expertise of the enemy. Look for ways to increase insecurity, anxiety and uncertainty."

4. "Make the enemy live up to its own book of rules."

5. "Ridicule is man's most potent weapon."
8. "Keep the pressure on, with different tactics and actions, and utilize all events of the period for your purpose."

9. "The threat is usually more terrifying than the thing itself."

10. "The major premise for tactics is the development of operations that will maintain a constant pressure upon the opposition."
13. "Pick the target, freeze it, personalize it, and polarize it."

Did I Forget To Mention That Steyn Rocks?

As it happens, the best way to ensure catastrophe is to “act now.” It would be nice if the world could all prance along in regimented unison like the Radio City Changettes. But, alas, the foreigners made the mistake of actually reading the “stimulus” bill, and the protectionist measures buried on page 739 sub-section XII(d) ended, instantly, the Obama honeymoon overseas. The European Union has threatened a trade war. Up in Canada, provincial premiers called it “a march to insanity.” Wait a minute: I thought the Obama era was meant to be the retreat from insanity, a blessed return to multilateral transnational harmony?

As longtime readers will know, I’m all in favor of flipping the bird to the global community. But at least, when Rummy was doing his shtick about “Old Europe,” he did it intentionally. To cheese off the foreigners entirely by accident before you’ve even had your first black-tie banquet is quite an accomplishment.


Appearing on The Rush Limbaugh Show last week, I got a little muddled over two adjoining newspaper clippings—one on the stimulus, the other on those octuplets in California—and for a brief moment the two stories converged. Everyone’s hammering that mom—she’s divorced, unemployed, living in a small house with parents who have a million bucks’ worth of debt, and she’s already got six kids. So she has in vitro fertilization to have eight more. But isn’t that exactly what the Feds have done? Last fall, they gave birth to an $850 billion bailout they couldn’t afford and didn’t have enough time to keep an eye on, and now four months later they’re going to do it all over again, but this time they want trillionuplets. Barney and Nancy represent the in vitro fertilization of the federal budget. And it’s the taxpayers who’ll get stuck with the diapers.
2nd link in a row. Steyn rocks! RTWT.


Yeah, sure, no previous occupant of the White House has been able to walk on water—your Eisenhowers and Roosevelts, your Chester Arthurs and Grover Clevelands and whatnot. But Barack Obama didn’t run as just another of those squaresville losers. He was gonna heal the planet, and lower the oceans. So, even if he couldn’t walk on water, he should at least be able to paddle in it. “He is a community organizer like Jesus was,” said Susan Sarandon, “and now we’re a community and he can organize us.”
So how’s that going? Jesus took a handful of loaves and two fish and fed 5,000 people. Barack wants to take a trillion pieces of pork and feed it to a handful of Democratic-party interest groups. Jesus picked twelve disciples. Barack seems to have gone more for one of those Dirty Dozen, caper-movie line-ups, where the mission is so perilous and so audacious that only the scuzziest lowlifes recruited from every waterfront dive have any chance of pulling it off.

Political Risk

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With its crusading tone and almost total absence of argument from fact, Rudd’s essay is more of a religious sermon than a work of serious political and economic analysis. It involves three articles of faith: first, that the past 30 years has witnessed the triumph of extreme capitalist ideology; second, that this kind of capitalism has comprehensively failed; and third, that only social democratic political parties can be trusted to shape the future. All of these propositions are demonstrably false.

Ultimately it is an argument over whether the current economic crisis justifies the bureaucratic demand for more power over our money.

Nobody wants to talk about which government policies got us into this problem in the first place. The conversation seems to be confined to ways in which government can get us out of it. And that is an incomplete analysis. To the extent that “political risk” — bad policies — got the world into this mess it makes sense that government must get us out of it.


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Fannie and Freddie were explicitly exempted from Sarbanes-Oxley, and never had to register their securities with the SEC. Just a couple of lovely things their gigantic lobbying operation bought.

rockmom on February 7, 2009 at 2:23 PM

Geez, I didn’t know that. Total FUBAR.

Saving Doesn't Create Wealth?: Counterfeiting Edition

There are many reports that the Obama economics team is using a multiplier of 1.5 to estimate the effects of government spending. The theory of the multiplier is that $100 of government spending is supposed to "stimulate" the production of $150 in increased wealth.

Obama also believes that the multiplier for tax cuts is only about 1, so much more wealth is created when the government spends money collected from taxpayers than when the taxpayers spend that money. The idea is that the taxpayers might save some of that money, so it won't flow around and create wealth.

Obama believes that the government can spend so that its dollars go to people who won't save any of it. They will help the rest of us by spending it all.

Obama's team is making this stuff up as they go along. It can't possibly be true. But, being in a good mood, let's assume that it is true. Then the following is also true.

We should immediately license counterfeiters.

Even Keynes Isn't Keynesian

As I previously noted, the older (and presumably wiser) John Maynard Keynes was skeptical of using infrastructure projects as a countercyclical tool. NYU economist Mario Rizzo now brings to my attention that the mature Mr Keynes also favored the payroll tax as a countercyclical policy instrument:

In correspondence with the economist James Meade in 1942 Keynes says he is “converted” to Meade’s idea of altering the social security payroll tax over the business cycle. Here are Keynes’s words:

I am converted to your proposal…for varying rates of contributions in good and bad times.

(June 16, 1942). Keynes, Collected Writings, vol. 27, p. 208.

Tinfoil Apocalypse Watch: A.Q. Khan Edition

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It is true that Osama bin Laden is the most wanted terrorist alive. But someday, a terrorist attack will occur that will make OBL's lifetime achievements pale in comparison, because it will use a nuclear weapon. When thta day comes, it will be directly attributable to one man: Abdul Qadeer Khan, the father of Pakistan's nuclear bomb and the leader of a clandestine network that sold nuclear secrets to other nations that sponsor, support and/or harbor terroist groups. It is this man, AQ Khan, who was released by Pakistan from house arrest yesterday.

A court in Pakistan
has ended the house arrest of Abdul Qadeer Khan, a scientist who
admitted selling nuclear secrets to Iran, North Korea and Libya.
I don't know how this man can sleep at night, knowing what he has unleashed. Then again, his statement about being "proud" for what he did - not for Pakistan, but in the long run, to Pakistan, suggests that for all his technical brilliance, he is a very stupid man indeed.

The Definition Of Insanity

Fannie Mae will loosen credit requirements for home mortgages. No, that’s not from a five-year-old paper, that’s today’s Bloomberg news.

Feb. 5 (Bloomberg) – Fannie Mae, the mortgage-finance company under U.S. government control, will loosen rules for homeowners seeking to lower their loan payments by refinancing.

Fannie Mae will drop some credit-score requirements, reduce income-documentation standards and waive the need for appraisals in some cases, according to a notice yesterday to lenders posted on the Washington-based company’s Web site. The changes apply to loans that the company owns or guarantees.

Harding II

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Or it could be emblematic of the fact that this is the first actual job he’s had and is at a loss on how to handle it all.

That pretty much nails it. The biggest achievement of his previous job was to get elected to the next job. Each one as a steppingstone without any substantial accomplishment on the job. What would he cite as his greatest accomplishment in the US Senate? His proposal two years ago that all US combat troops be withdrawn from Iraq by March 2008?

Executive experience: Annenberg Challenge. Distributed over $100 m for research in improving Chicago schools. Result: no difference in performance between Annenberg schools and non-Annenberg schools.

I looked at US Presidents who had also been US Senators, and compared their experience in the following positions: US VP, US cabinet member, Governor, Military, House of Representatives.

Obama’s experience: none of the above. The only other President once a member of the Senate who also had “none of the above” was Warren Harding.

If only it would turn out that well...

Extreme Lunacy

 blog it

Friday, February 06, 2009


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MORE ON MADOFF, GEITHNER, RANGEL, DODD, ET AL., in the Tampa Tribune: “Americans have been taught that crime does not pay. This message seems to be changing in our evolving modern culture. The more accurate statement is, ‘crime does pay for the rich and connected’ and only does not pay for the common person.”

Dependency ... Then Bondage

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Jerry Pournelle: “The tax cut provisions of the ’stimulus bill’ seem aimed at solidifying party control: most of it is transfer payments to people who don’t now pay taxes. In the US 40% don’t pay federal taxes. If any large number of those are given money as transfer payments they will learn to rely on them. At which point they will be motivated to vote. And community organizers will see that they do vote. Now understand: many of those who get negative income taxes do necessary work and they aren’t very well paid. The question becomes, is that a federal problem, and should it be dealt with by transfer payments? Because once this is instituted, it’s going to be pretty permanent. Those affected by it will be mobilized to defend it, and it will mean more to them than it does to those opposed. So it goes.”

Amusing Ourselves To Death (Part 45,925)

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OOPS: “Researchers found that teenagers who watched more television had greater odds of becoming depressed. Interestingly, there was no similar correlation between watching videos or playing computer games and depression. Ironically, I first read this news on a TV screen in an elevator. I felt kind of bad about that afterward.”


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WILL WILKINSON: Captives in our homes. “Government-subsidized borrowing gave us the housing bubble, precipitated financial Armageddon, helped prompt recession and mass unemployment. But, as the infomercials say, that’s not all! By zealously pushing home-ownership, federal housing policy has pinned to the map many now-jobless Americans who otherwise would have moved to find new work. “


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HOPE AND CHANGE! Panetta: Rendition Will Continue, Would Ask Obama to Authorize Harsher Interrogation Methods “If Necessary.” You know, much more of this and I’ll start to think that all the concern over rendition and waterboarding was just insincere electoral hooey.

The Diminishment

So then you get the argument, well, this is not a stimulus bill, this is a spending bill. What do you think a stimulus is? (Laughter and applause.) That's the whole point. No, seriously. (Laughter.) That's the point.

Under this "logic," any bill that contains spending should be enacted because, by definition, it provides "stimulus." It doesn't matter how much stimulus is provided or when the stimulus will occur. This is quite possibly the most irresponsible position ever taken by a president on an economic issue.

Just a few weeks ago, in his inauguation speech, Obama said that his touchstone for governmental action is how well it will work. Now the touchstone is whether it constitutes spending.

The problem is that given enough time, every spending program in that plan will have to be paid for by taking money out of the economy. The result of taking money out of the economy is the opposite of stimulus.


Of course, it wouldn't be a liberal wish list if it didn't include something for ACORN, and sure enough, there is $5.2 billion for community-development block grants and "neighborhood stabilization activities," which ACORN is eligible to apply for. Finally, the bill allocates $650 million for activities related to the switch from analog to digital TV, including $90 million to educate "vulnerable populations" that they need to go out and get their converter boxes or lose their TV signals. Obviously, this is stimulative stuff: Any economist will tell you that you can't get higher productivity and economic growth without access to reruns of Family Feud.

"De-stimulating" doesn't quite capture it, but it'll do for the moment.


An MIT report concluded "the U.S. government begin thinking about such a portfolio of demonstration projects and not be singularly focused on any one project such as FutureGen." And the Washington Post editorial board also concluded the technology was "prohibitively expensive."

So in effect the inclusion of $2 billion for a near zero emissions powerplant amounts to a staggering earmark — one that's nine times the cost of the bridge to nowhere. It's also substantially larger than Congress' previous earmark record of $1.5 billion for the DC metro system last year.

After FutureGen was abandoned, disgraced Illinois Governor Rod Blagojevich paid Cassidy and Associates, a major Washington, D.C. lobbying firm, $468,000 in public funds to lobby to restart the project. The Illinois delegation in Congress has also been pushing hard for the FutureGen earmark


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LESSONS FROM A STIMULUS THAT FAILED: “Japan’s rural areas have been paved over and filled in with roads, dams and other big infrastructure projects, the legacy of trillions of dollars spent to lift the economy from a severe downturn caused by the bursting of a real estate bubble in the late 1980s. During those nearly two decades, Japan accumulated the largest public debt in the developed world — totaling 180 percent of its $5.5 trillion economy — while failing to generate a convincing recovery.

Among ordinary Japanese, the spending is widely disparaged for having turned the nation into a public-works-based welfare state and making regional economies dependent on Tokyo for jobs. Much of the blame has fallen on the Liberal Democratic Party, which has long used government spending to grease rural vote-buying machines that help keep the party in power.”

Well, that sounds familiar . . . .

Thursday, February 05, 2009

Resurrected Crap

So what exactly is a shovel-ready project?
At issue is that 90-day restriction stipulated by Congress, an even narrower window than the bill’s original 180-day limit. “They’re well intentioned, and they know their infrastructure sucks, so they’re trying to do immediate reactive management to what is a very deep, endemic problem,” says Robert Bea, a professor of civil and environmental engineering at the University of California, Berkeley. “If you want to patch some potholes in the road, this is a good program. But if you’re hoping for anything long-term with this approach, throw away all hope. It can’t happen.”

The programs that would meet the bill’s 90-day restriction are, for the most part, an unappealing mix of projects that were either shelved after being fully designed and engineered, and have since become outmoded or irrelevant, or projects with limited scope and ambition. No one’s building a smart electric grid or revamping a water system on 90 days notice.


Cliff Notes

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Roosevelt: We have nothing to fear, but fear itself!

Obama: Be afraid. Very afraid!!



Is it possible that Europe and Russia, seeing a shift to the Left with Obama that will weaken America economically, are shifting to the Right to maximize any advantage coming out of the downturn? Because that is what is happening to some extent folks.

Russia opts for fiscal discipline and a no bailout approach.

Russia signalled a change in its policies to fight the financial crisis on Wednesday, indicating that it would switch from bailing out individual companies to supporting the economy through the banking sector. Moscow also plans huge budget cuts in an attempt to limit its fiscal deficit – rejecting pressure to follow the US and other western countries to try to stimulate the economy with a big boost in public borrowing.

And Deutsche Bank says no thanks to state aid, even with its worse loss since WW II.

Chairman Josef Ackermann said the bank did not require government assistance and would pull out of the financial crisis on its own.


Norma For President

Move Along Now

-- In 1995, the Clinton Administration strengthened CRA. The implementing regulations for the CRA were strengthened by focusing the financial regulators' attention on institutions' performance in helping to meet low income needs. Clinton fostered the concept of the subprime loan. In other words, a bank product was created to make loans to those who were not able to repay, and to bundle these into marketable securities.

-- In 2004, chief executive Richard F. Syron received a memo from Freddie Mac's chief risk officer warning him that the firm was financing questionable loans that threatened its financial health.

-- In 2004 at a House committee hearing, Barney Frank said " and soundness is not an issue." Maxine Waters said, "Franklin Raines has done a wonderful job."

-- In 2005, a Republican reform passed the Senate Banking Committee on a party-line vote, only to be blocked by Democrats from passing the full Senate.

Total contributions to Congress was $4,844,572.

The Threat Of Hell

Bailouts, which include "stimulus packages" that direct income to people who have not earned it, are, alas, integral to the cumbersome machinery by which the Nanny State spreads moral jeopardy. They subvert the moral and economic order, simultaneously, as Jerry Taylor of the Cato Institute explained with wonderful concision recently: "Capitalism without the threat of bankruptcy is like Christianity without the threat of hell. It doesn't work very well."
President Obama can be more easily forgiven than Bush, to the extent that he is indeed a glittering fog of pretty words, with no idea what he is doing.
Mr. Iacocca's rant was against failures of leadership.
It is that a leader must be a lonely man. He must defend the truth, alone if necessary. He must win his people over to the truth, by every honest means at his disposal, or go down trying. It is when we don't have leaders like that, that we have messes like this.


Rep. Hilda Solis is the latest Obama Administration cabinet nominee to run into tax problems. (WaPo)

Today, in was reported that Obama's nominee for labor secretary, Rep. Hilda Solis, has run into a little glitch of her own.

A Senate committee today abruptly canceled a session to consider President Obama's nomination of Rep. Hilda Solis to be labor secretary in the wake of a report saying that her husband yesterday paid about $6,400 to settle tax liens against his business -- including liens that had been outstanding for as long as 16 years.
Glenn Reynolds has two thoughts:
(1) Don’t any of these people pay their taxes? And (2) Is this, like, some kind of karmic payback for all the Joe-the-plumber tax business?

Wednesday, February 04, 2009

College Club

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They see lower-middle-class populists like Palin and their supporters as profoundly ill-suited for governance, because they lack the accoutrements required for its employment—especially in foreign policy, which, even more than domestic affairs, is thought to be an intellectual exercise. It is for this reason that Barack Obama, who actually has far less experience in executive governance than Palin, was not dismissed as unprepared for the presidency. Palin may have been elected governor of Alaska, but his peers in Cambridge had elected Obama editor of the Harvard Law Review. He is thoroughly fluent in the parlance of the college town, and in the eyes of the new American elite, Washington is the ultimate college town.”

The Drag

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OH, GOODY: Treasury in plans for record debt sale. “The US Treasury on Wednesday opened the floodgates of government bond issuance, revealing plans for a record debt sale in February and more frequent auctions in the months to come. The announcement came amid growing fears about US government deficits and sent the yield on the benchmark 10-year Treasury note rising to 2.95 per cent, up from just over 2 per cent at the end of December. The rise in Treasury yields has been pushing mortgage rates higher, complicating efforts to revive the economy.” So the “stimulus” is now a drag on the housing market. . . .

Tuesday, February 03, 2009

Sully's "Problem"

Chesley Sullenberger has a problem. He borrowed a book from the Danville Library – and it’s overdue. To complicate matters, the book was an interlibrary loan from Fresno State.

Sullenberger contacted librarians and asked for an extension on the loan and a waiver on the overdue fine. The reason? The book is in the cargo hold of the US Airways plane that made an emergency landing last month in New York’s Hudson River. Sullenberger is the pilot who made that landing. No one was seriously injured.

Fresno State library officials were impressed with Sullenberger’s sense of responsibility… and waived all fines and fees, even the one for losing the book. The library’s going one step further: when the replacement book goes up on the shelf, it will have a special template in front, dedicating it to Chesley “Sully” Sullenberger.

Oh, by the way. The topic of that book? Professional ethics.
And our problem is that we have a corrupt clown for President instead of Sully.


Apart from political leaders, a reasonably diligent reader of a quality newspaper in the West will not be able to name a single Muslim distinguished in any field of human endeavor. Excluding the politically awarded Peace Prize, Muslims have won only three Nobel prizes since their inception more than a century ago, or one for every 450 million Muslims alive today. By contrast, there have been 169 Jewish Nobel Laureates (excluding the Peace Prize), or about one for every 89,000 Jews alive today. During the past century, a Jew was 5,000 times more likely to win the Nobel than a Muslim.
The last native of a Muslim country to receive the Nobel was the Turkish novelist Orhan Pamuk, a secular critic of his native country now living in New York City in virtual exile, unable to return to Istanbul in safety.
Adonis calls his work an obituary for the Arabs. "We have become extinct," he told Dubai television on March 11, 2007.

Routine Emergency

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When airplanes crash, it’s usually because a bunch of unexpected things go wrong all at once, or one after the other. Obviously something dramatic went wrong with US Airways Flight 1549, which lost power in both engines and crash-landed on the Hudson River on January 15. But a lot went right, too.

For airline pilots, training focuses on dire scenarios, such as the US Airways crew encountered. “Pilots don’t spend their training time flying straight and level,” says airline pilot Lynn Spencer, author of Touching History: The Untold Story of the Drama That Unfolded in the Skies over America on 9/11. “In simulator training, we’re doing nothing but flying in all sorts of emergencies. Even emergencies become just another set of procedures when repeatedly trained.” As more information emerges on the actions of “Sully” and his first officer, Jeffrey Skiles, it seems clear that it was cool, rational decision-making that saved the day. That’s reason enough to lionize the pilots.

They Don't Call It The Hoover Dam For Nothing (Part 49,237)

In the first half of last century two presidents inherited recessionary economies from their predecessors. Both campaigned on smaller government, and both blamed the profligate ways of the previous president for their economic problems. One ended the recession in less than three years; the other lengthened it by seven.
prior to FDR's interventions, "The economy was poised for a beautiful recovery, but that recovery was stalled by these misguided policies." Somehow, though, FDR is considered one of the best presidents in the history of the country, despite the millions of people out of work and in the breadlines. Hoover is rightfully considered one of the worst, but perhaps FDR should be, too. As Rexford Guy Tugwell, one of Roosevelt's top advisors commented, "We didn't admit it at the time, but practically the whole New Deal was extrapolated from programs that Hoover started."
President Obama has mentioned his fondness for FDR. Let's hope he soon comes to prefer Harding.


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J. Scott Armstrong, a noted professor of marketing at Wharton, has taken a look at the “global warming models” and come to some conclusions:

We have concluded that the forecasting process reported on by the Intergovernmental Panel on Climate Change (IPCC) lacks a scientific basis.

1. No scientific forecasts of the changes in the Earth’s climate. Currently, the only forecasts are those based on the opinions of some scientists. Computer modeling was used to create scenarios (i.e., stories) to represent the scientists’ opinions about what might happen. The models were not intended as forecasting models (Trenberth 2007) and they have not been validated for that purpose. Since the publication of our paper, no one has provided evidence to refute our claim that there are no scientific forecasts to support global warming.

We conducted an audit of the procedures described in the IPCC report and found that they clearly violated 72 scientific principles of forecasting

A Better Start

There are two kinds of people in the electorate: 1. People who remember how horrible the Jimmy Carter years were. 2. People who are about to find out.

To be fair to Carter, though, he got off to a better start.

Political Miracle On Video

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Eleven minutes, but they pass quickly thanks to his soft-spoken style. No histrionics, just Grade A red-meat fiscal conservatism. This issue is his chance to make an impression on the base ahead of 2012 and he knows it. Consider it made. Especially given how enthusiastic governors like Charlie Crist seem to be about the plan.