Recommended Reading

I’ve read several news articles today on a variety of issues that really resonate with me. Each author does a great job describing common sense positions in a much more effective way than I could ever convey in a reasonable period of time. Yes, writing a blog post takes time to research, think about, and then formulate in words, and for this reason, I offer the following recommend readings, organized by policy issue so that you can read what interests you and leave the rest. Hopefully, a few of you will find at least one issue that interests you enough to read more!

IMMIGRATION: It turns out that many people are not happy at all with the Gang of Eight’s proposed immigration bill because it grants amnesty without sufficiently securing our borders first. Since the government made this mistake when it granted amnesty to a bunch of illegal aliens back in 1984, how can anyone be in favor of repeating this mistake again? Oh yeah, there is an election coming up in about 18 months! You know what, though? I don’t care about another election, and I am sick and tired of politicians getting away with stupid policy decisions because the right policy choice was too painful politically. Just to clarify, I am in favor of making it a lot easier for foreigners to legally immigrate to our country; I am not in favor of allowing illegal immigrants to become citizens without going to the back of the line first; I support securing our border with Mexico as a pre-condition to any amnesty program; and I am in favor of securing the border by constructing an actual fence the entire distance of the border, because this project would secure the border once and for all and because it would create jobs. Final note: I do not agree with the position that Rubio is wrong to work with the other party on this issue. How else will anything ever get done?

“Rubio hit hard after inviting comments on immigration bill” by Byron York, Washington Examiner.

ISLAMIC JIHAD: The administration has removed from its discourse any mention of the policy formerly known as The War on Terror. An article I read early in the week mentioned that an FBI Training Manual had been revised to exclude any mention of Islamic radicals, apparently in an effort to make the training manual less offensive to Muslims and more politically correct in general. From this same article we learn that in a further attempt to remove the focus on Islamic Jihad, the administration has labeled the massacre at Ford Hood in 2009 “workplace violence” instead of the Islamic jihad it really was. So, I was pleasantly surprised when I reluctantly opened Thomas Friedman’s article in today’s NY Times, in which he asks the Muslim community “what is going on in your community that a critical number of your youth believes that every American military action in the Middle East is intolerable and justifies a violent response, and everything Muslim extremists do to other Muslims is ignorable and calls for mostly silence?” More than anything, I am glad to hear a Times opinion writer actually opine on the Muslim community’s role in doing something about the war being waged against the West and even other Muslims by radical Islamists in the name of Allah.

Along the lines of Islamic Jihad, consider reading “Will Boston Probe Falter Like Benghazi” by Debra Saunders of the San Francisco Chronicle.

ECONOMY: The WSJ does a great job calling out the Obama Administration for what is clearly a failed economic plan to grow the economy, in its article this week titled “The Growth Deficit.” The results speak for themselves, and the article does a great job detailing the dismal results in case you haven’t been paying attention. In the event you have paid attention and view things differently, then God help you… and read this article by Conn Carroll of the Washington Examiner. We have a jobs killing, mandatory health insurance law that does nothing to address the drivers of medical inflation. We have a real unemployment rate approaching 14%, yet plenty of manufacturing firms cannot find employees because welfare recipients earn, on average, 80% of what they would make if they actually had a job. Disability roles have surged because the hurdle for proving disability has been dramatically reduced by a compliant administration. Worst of all, we have a tax and spend administration intent on creating the mother of all welfare states that will soon dwarf, if it does not already, any of the European welfare states, all in the interest of fairness and  in an effort to stick it to the top 1%-5%.

GEORGE W. BUSH: I have always liked Peggy Noonan, but I am sure many people disagreed with her article in the WSJ this week titled “The Presidential Wheel Turns.” I do not disagree with Ms. Noonan’s article.

Well, that’s all folks. I hope everyone has a great week!

The wheels on the bus go round and round

There hasn’t been anything too terribly interesting in politics lately, which is the reason several weeks have passed since my last post. Sure, the Senate finally passed a budget after 4 years, and the House passed yet another Ryan budget which has zero chance of ever becoming law. Why do both Houses of Congress waste their time passing such partisan budgets? The Senate voted to raise $1 trillion in new taxes, and the House voted to repeal ObamaCare, again. I get that negotiations typically start by staking out an extreme position in order to be able to give ground during the negotiating process before settling on some compromise, but haven’t Democrats and Republicans already staked out their extreme positions quite clearly? Is it really necessary to start all over again with budget bills that were passed almost entirely along partisan lines? Only in Washington, I suppose, is it necessary to waste more time, more money and more effort pandering to each side’s political base (yet again) instead of advancing the interests of the country as a whole by passing legislation that actually has a chance of becoming law.

Speaking of the interests of our country, President Obama visited Israel this week, setting expectations for the visit so low that managing to land Air Force One safely at Ben Gurion Airport could reasonably be touted as cause for celebration. Yet, just as Obama was preparing to leave Israel for Jordan, we are supposed to believe that our chief yahoo was the impetus for Israel’s Netanyahu placing a call to Turkey’s Erdogan to make amends for the 2010 killing of Turkish aid workers. Please Mr. Yahoo, not everyone is a low information voter who takes everything you say at face value and believes that this arrangement was not already pre-planned and pre-packaged well in advance of your arrival in Israel. Indeed, many of us, well, about 47% of us, don’t believe much of any anything you ever say. It is not hard to believe that Hollywood loves this Administration so much, which is why I think many of Obama’s staffers could enjoy post-political careers in the fantasy and make believe world of the country’s left coast.

If Obama really wanted to get something accomplished in the Middle East, he could start by actually using the power of his position to garner support for a coalition of the willing to finally start to do something about the slaughter of over 70,000 Syrians by the most brutal, serial killing opthamologist the world has ever seen, Bashar Al-Assad. It is wrong to think that we could not get support from the Arab world for such an under-taking. In fact, many Arab people are wondering what we are waiting for. Maybe our chief yahoo is waiting for Putin and the communists in China to give us permission. Guess what? They aren’t ever going to give us permission, and if we continue to let the U.N. have its way, then we are giving Iran de facto permission to continue fighting the opthamologist’s battles, which gives the crazies from Persia a stronger opportunity to gain more power in the region as well as a border with Israel.

I thought the use of chemical weapons was a red line for Obama. Yet, news reports this week of chemical weapons now being used have not gotten any legs, which is eerily familiar to the liberal media largely ignoring the fact that Obama misled the entire world about the terrorist attack on our consulate in Benghazi.

Friends, I may sound partisan, but it’s hard not to sound partisan when using facts and truth in discussion of an Administration that is singularly dedicated to maximizing political expediency.

Lastly, I mentioned in my last post that I would discuss Doha, Qatar in this post. Basically, these guys have so much cash from selling oil and natural gas that the buildings you see below are largely empty, the result of a massive building binge coupled with a society that remains relatively closed to outside investment and outsiders in general. Interesting…but not so interesting that it’s worth writing more about it.

Hi Ho, Hi Ho, It’s Off to Greece We Go

I visited several customers this month, and along the way I learned some interesting facts about how other countries are handling problems like the ones we face in the United States. In this post, I will discuss Greece, the first stop on my trip. What I wanted to learn in Greece is if their economy is as bad as we hear it is from the U.S. news media.

It seems they still have money to try to keep the Acropolis from falling down.

I asked several Greeks about the state of their economy, including my customer and some of his employees, two policemen patrolling the street, my hotel concierge, the rental car clerk, and many others. The responses ranged from “our economy is terrible” to “we are in a depression” to “it’s not getting any better.” Just how bad is it? Unemployment surged from 20% in November 2011 to 27% this past November. The Greek economy contracted 6% in the 4^th quarter of 2012. Listening to Greeks talk about their economy actually sounded a lot worse than hearing about it from the media.

I was glad they didn’t shoot me when I asked them about their economy.

When the going gets tough in Athens, what do government employees of the metro system do? They go on strike. The Athens metro system was shut down during my visit, hence my opportunity to talk economics with the Hertz agent. In protest over cuts in their pay imposed as a result of wide ranging austerity measures, the striking metro workers have figured out how they can stay off the job each week but still get paid for 4 days of work.

Here’s how the metro workers game the system: the train operators will go on strike on Monday and forfeit their pay for the day, while all the other metro departments get a paid day off. On Tuesday, another department will return the favor and forfeit a day’s pay by going on strike, allowing the train operators and their other non-striking colleagues to enjoy a paid day off.  The same dynamic occurs each day for the rest of the week, resulting in a rotating system of striking employees who make 80% of their regular pay without ever going to work. This sounds a lot like America’s welfare system, at least the part about getting paid handsomely not to work (for which I fault our government entirely, and not the people who cannot find jobs).

POTUS went into full campaign mode this week to drum up indignation and shock about the reductions in the growth of government spending that are slated to go into effect on March 1. Never mind that he proposed this plan, that congress passed the bill, and that his righteousness signed it into law himself. This student of power and how to use it to for social engineering purposes has been schooled, and now he is creating hysteria among the willing, particularly Chris Matthews of MSNBC, Paul Krugman and his buddies at the New York Times, and the rest of the mainstream media, who believe everything POTUS says, despite a long and still growing record of half-truths and blatant lies that are dividing the country and prolonging our economic malaise, that if left un-opposed, may eventually lead us to the same sorry state as Greece. Certainly, comparisons between the U.S. and Greece, with a population of just 11.3 million and no central bank, are not perfect; however, notwithstanding differences of scale and control over monetary policy, our position as the world’s largest debtor nation makes one wonder how long we can continue down this dangerous path before our debt load creates havoc for us like it has for the Greeks.

If we allow reductions in the growth of government spending to take effect, aren’t we just repeating the same mistakes that the austerity driven countries of Europe have made? Not at all. As the tables below demonstrate, the PIGS of Europe (Portugal, Ireland, Greece, and Spain) have actually had to make real spending CUTS, and the austerity measures have been very tough medicine, indeed. All the sequester is going to do is reduce the rate of spending growth. Shouldn’t we be willing to accept some small scale spending cuts now instead of increasing the risk that we might one day be forced to make real cuts like the PIGS have had to do?

Krugman would have us believe that we “should just call the whole thing off,” that the government should continue priming the Keynsian pump to avoid hurting the economy. Perhaps, he is right. However, what if this particular viewpoint is wrong? Is this risk something we really want to take, running $1 trillion deficits year after year. Is the $6 trillion debt increase under Obama not enough stimulus to show everyone that this approach isn’t exactly creating the robust growth we need? Why would we want to continue down this path after getting such anemic results so far? The government is a terrible steward of the money it receives from taxpayers, and that is reason enough to forget raising taxes again and let the sequester cuts happen.

The private sector endured enormous pain as a result of the financial crisis, while government payrolls continued to grow. Although the sequester may not target cost reductions in the most optimal way, the geniuses in Washington created it because it was the only compromise they could reach. I hope the president’s ego isn’t so enormous that he won’t direct his cabinet secretaries to minimize the disruption in services, rather than create maximum disruption in the hope of achieving political gain. Then again, his motives are always political, which is why he won’t ever achieve his grandiose expectations of being a transformational leader along the lines of MLK or Lincoln.

The graphs below show what real austerity looks like. Click on each graph for a larger image and hit the back button to return to the post.

This last chart shows what reductions in the rate of spending growth looks like, with the total amount spent continuing to climb into the future.

In a future post, I will explain what I learned while in Doha, Qatar, an oil rich nation with so much money they don’t know what to do with it all. Meanwhile, Obama can’t make a decision about the Keystone Pipeline, a project that would create thousands of jobs and boost the economies of many Mid-Western states. Perhaps it is better to continue employing armies of bureaucrats in Washington instead of taking advantage of real economic opportunities in the private sector. At least that’s what Obama wants to do.

Charge It

It appears that the President’s State of the Union speech will deal in large part on the economy, budget deficit and sequester cuts. Commentators and writers will pontificate on the president’s proposals, and lively debate about what the Left and the Right want to do (or not do) will surely ensure. Do not allow yourself to be hoodwinked if you tune in to the speech or the after-speech analysis. The main thing to keep in mind is that if you ran your household the way politicians run our government, you would have some very serious financial problems.

To put this issue into context, let’s assume that back in 2003 a family of 4 earned $60,000  but spent $72,000, putting their excess household expenditures of $12,000 on a credit card. By using the chart below, you can see how this family would have fared over the last 9 years if they did exactly what our government has done. By continuing to spend well in excess of what it earned, this family has racked up over $200,000 in credit card bills.

	Household Income	Househould Spending	Spending put on Credit Card Each Year	Total Credit Card Debt
2003	60,000	72,711	-12,711
2004	63,000	77,219	-14,219	-26,930
2005	72,135	83,242	-11,107	-38,037
2006	80,647	89,402	-8,755	-46,793
2007	86,050	91,905	-5,855	-52,648
2008	84,587	100,453	-15,865	-68,513
2009	70,546	118,434	-47,888	-116,401
2010	72,451	116,420	-43,970	-160,370
2011	77,160	121,310	-44,150	-204,520

This week you will hear politicians and pundits say that we cannot cut our way to prosperity. Do not listen to this nonsense. It is a smokescreen designed to mislead you. There isn’t a single proposal in Washington that proposes to spend less this year than last year. All the proposals deal merely with reducing the growth in spending.

You will hear that we cannot balance the budget off the backs of seniors and poor people. Do not listen to this nonsense. It is a smokescreen designed to mislead you. Government expenditures on means tested programs have skyrocketed in recent years. Some modest reductions in these areas is more than prudent.

You will hear defense hawks speak with alarm about how cuts to the Defense Department will significantly impair the military’s ability to defend us. Do not listen to them. They are deluded by self interest. Just remember this one fact: the United States spends more on defense each year than basically all the other countries in the world combined.

The fact is that our government has borrowed over $1 trillion from China since 2003. Don’t you think we ought to quit doing that?

Profound Inequality

The most serious, most profound and most pressing example of inequality in our country today is not sexual orientation, gender, or race. It is economic. Poverty begets more poverty, continuing from one generation to the next, as long as government social safety net programs continue to undermine personal responsibility and initiative by creating ever more dependency among our nation’s most disadvantaged. Republicans should quit whining about Obama not mentioning deficits in his inaugural address and instead seize upon the principles in his speech to press even harder for entitlement reform and for returning to the successful welfare work requirements that were signed into law almost 20 years.

We don’t need to raise taxes to keep the promises made to seniors who spent their working years paying into social security and medicare programs. We don’t need to raise taxes to invest more in early childhood programs. We need to reform entitlements so that we can continue to keep our promises to seniors and near seniors, and as important, we need a completely new approach to helping children who are born into poverty. For starters, we need school choice, and we need to dismantle the power of teacher’s unions that perpetuates the wildly unfair, unjust, and amoral program of teacher tenure. The teaching profession must be a meritocracy. Otherwise, we will continue to advance the careers of ill-suited teachers at the expense of our children.

For an interesting article from the NY Times this week on the issue of inequality among children, click here. From the same writer at the NY Times, click here for another article about how government programs often perpetuate poverty rather than fix it.

The meaning behind the title of my blog is as much about doing better by children and by people in poverty as it as about anything else. I just hope a leading Republican like Paul Ryan will soon have a larger voice on these matters and that we will hear a lot less from the Eric Cantor wing of the party (e.g. Amash, Huelskamp and anybody else Speaker Boehner kicked of key committees due to their intransigence.)

Retreat!

It seems the Republican Party has decided to stop shooting itself in the foot, finally. With the announcement that Republicans will now support an unconditional 3 month debt limit extension, party leaders have finally made a smart move. This welcome news could not come soon enough, as congressional approval ratings hover just above single digits and the president’s rhetorical onslaught against Republicans continues unabated.

Without some change in strategy, the Republican Party is headed for certain disaster in 2014. I learned the straight-forward concept of majority rules growing up with younger twin brothers. Whenever our parents allowed us to vote on something, invariably the twins would vote one way and I would vote another. Two beats one every time in a democratic process, a concept that has escaped many Republicans for far too long in their role as opposition party to a Democratic president and senate.

The Republican death spiral owes as much to a president intent on using his considerable oratory skills at their expense as it does to their own intransigence. By framing many of his arguments in terms of fairness while simultaneously unfairly characterizing the opposition, the president has deftly positioned himself with many Americans as the only responsible adult in the room, which of course, could not be further from the truth. The president speaks in platitudes of a fair and balanced tax system, while 48% of Americans pay no federal income tax and the top 5% generate 59% of all government tax receipts.

Two recent statements by the president, one concerning deficit reduction and the other concerning gun control, further exemplify his willingness to play loose with facts while continuing to engage in attack mode against Republicans.

“But it seems as if what’s motivating and propelling at this point some of the House Republicans is more than simply deficit reduction.  They have a particular vision about what government should and should not do.  So they are suspicious about government’s commitments, for example, to make sure that seniors have decent health care as they get older. They have suspicions about Social Security.  They have suspicions about whether government should make sure that kids in poverty are getting enough to eat, or whether we should be spending money on medical research.  So they’ve got a particular view of what government should do and should be.”

“There will be pundits and politicians and special interest lobbyists publicly warning of a tyrannical, all-out assault on liberty, not because that’s true but because they want to gin up fear or higher ratings or revenue for themselves. And behind the scenes, they’ll do everything they can to block any common-sense reform and make sure nothing changes whatsoever.”

With an opponent like the president who is willing to mis-characterize your positions in such an egregious manner, and a public willing to hear what they like and disregard the rest, House Republicans have decided correctly to pursue a new approach. This approach will be successful as long as House Republicans can maintain patience and confidence. The president’s agenda of bigger government and bigger deficits is a losing proposition, and this fact will become more fully realized by the public in the course of time. Instead of aggravating for change in terms that are clearly aggravating many Americans, House Republicans need to seize present opportunities where they can be successful.

This new strategy will entail operating in a much more bi-partisan manner on issues that are important to many Americans, namely immigration reform and gun control. Find common ground with Democrats on these issues and pass some legislation so you can also claim some of the credit when the president signs new laws into place.

Continue to work to limit the growth of spending, but do it in much smaller increments. Visions of a grand bargain on tax and entitlement reform must be forgotten, at least for now. Until Republicans have more power, continuing to advocate for big change will remain a big waste of time. Patiently bide your time until circumstances change and the need for entitlement reform becomes a more urgent priority among the electorate.

Remain confident that the principles of limited government, low taxation and personal responsibility will soon become more important to a public that is certain to grow ever more distrustful of the president’s trickle up economic theory that obviously does not work and will never work.

Above all else, remember that the principles that unite Republicans must never be used to divide Americans. Seek always to demonstrate how Republican ideals are the only way less advantaged Americans, especially minorities, can become empowered to realize their full potential, as opposed to the statists now in power who want government to control all aspects of our economy and society.

The olive branch of a 3 month debt limit extension is really more an act of preserving what little power Republicans now have than anything else. To maximize opportunities for gains in 2014, House Republicans must stand together in pursuit of their common objectives, and the only way to do that is to pay proper respect to the current balance of power. By the time election season heats up again, the president and his party will have driven the country further into the ground, and by then the American people will be ready to be led in a different direction.

Living Large in Istanbul

I came across an interesting factoid today concerning wasteful spending which epitomizes the Idiocracy known also as our government. Late last year, a Department of Justice report revealed that the Drug Enforcement Administration spent $1.18 million dollars to host a conference in Istanbul, Turkey in 2008. That’s one-point-one-eight million dollars for 368 DEA agents to convene at the lavish Conrad Istanbul Hotel overlooking the Bosphorus Straits.

Now, this article is particularly interesting because I have actually been to this hotel before. I didn’t stay there, because it was too expensive for my budget. The Conrad was simply a convenient place to meet a colleague of mine who lives in Istanbul. Instead, I chose to stay at the Crowne Plaza Old Town, which has at least two fewer stars than the Conrad and certainly no view of the Bosphorus.

A room at the Conrad runs about $400 per night.

A room at the Crown Plaza sets you back about a $229 per night. And, I did not have rose petals on my bed when I checked-in, either.

Remember the news report last year about the GAO conference in Las Vegas that cost $863,000? Those guys ain’t got nothing on these DEA agents!

In closing, if $1.18 million seems like chump change, then perhaps you will be more impressed to know that the Department of Justice spent a total of $121 million on conference related expenses in 2008 & 2009. Remember those years? The stock market was tanking, the economy was in free-fall, and employers were shedding 500,000 jobs per month. Meanwhile, the government was spending money faster than they could print it.

According to last week’s WSJ interview with Speaker John Boehner, President Obama told Speaker Boehner during the Fiscal Cliff negotiations that “we don’t have a spending problem” and that “I am getting tired of hearing you say that.”

Really? No spending problem?

Note: The full report about the DOJ inquiry into the DEA conference can be accessed by clicking here.