Tuesday, March 31, 2009

The Global War On Terror: All Gone Now!

It seems that, according the Obama Administration, the "Global War On Terror" is all over with. I can't quite remember if we celebrated "V-GWT Day" like our previous "V-E Day" or "V-J Day" when we won in both Europe and in Japan during World War II; but, we must have had one and I just missed it. This is a really big deal.

The only reason that I know that we might have won is because the Pentagon has been "told" to drop the "War on Terror" thing and we have moved on to a new clean-up operation called the "Overseas Contingency Operation" (See Full Story) . This position was just confirmed yesterday by Hillary Clinton while overseas (See Full Story).

I think the word "contingency" is an interesting choice. What that word implies is one of a reactionary mode or, more appropriately: "We ain't going to do nothing until you terrorists boys (and, sometimes terrorist girls) attack us again!" I guess we'll just kick back; suck down a beer or two; and wait for the next attack.

So, I get it: No more words like terrorist that might offend those few Muslims who might want to mass kill or behead us all. I suppose that word was very hurtful to their feelings. We wouldn't want do anything like that. After all, Obama is the new, Kum-ba-ya President.

I think the change in wording signals more than that. My guess is that we will go back to the Clinton years when terrorism was just treated like a police action and not a military action. You know, the kind of dumb policy which led up to 9/11.

I suppose that after an attack, we'll condemn the bastards that killed any Americans and, then, died while doing it. Then we'll hunt down those who might also been responsible. From that point on, our Miranda-card carrying cops of some kind will catch 'em; read them their rights; and bring them to justice in our U.S. courts. Because there's no more Gitmo, we can let them out on bail and, just maybe, Eric Holder will put them up in a U.S. hotel while waiting for their day in court. If they aren't convicted...well...they'll have to be let go on to our city streets. Or better yet, they can sue us for false arrest or imprisonment and they can all become millionaires at our expense! Isn't America great!

Whatever the case, this is a good time to be a terrorist. How do you say "Happy days are here, again!" in Arabic?

Image of Edith Shain VJ Day Kiss NYC provided by Ghost*Rider (Patrick)'s photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Monday, March 30, 2009

About the Firing of GM's CEO

In today's announcement of further bailout monies for the Auto Industry, Barack Obama stated that the government has no intention of running the auto companies. Oh, really?

By demanding a restructuring plan from any corporate entity, the government is effectively running that company. Further, by telling a company to fire it's CEO, the government is running that company. Telling a company what they can or can't pay their execs or what bonuses they can give out is running a company. Telling them that they can't have corporate jets or that they are not allowed to have off-site meetings is running a company.

As soon as any bailout money was given to any Bank or auto company, the Obama Administration decided that they could tell those companies how they should operate. It is just plain disingenuous for Obama to say otherwise.

Furthermore, Obama/Geithner want even more control of American business; even those who haven't received bailout funds; but, who are "determined" to be essential to America's economic health. In theory, that could include a profitable company like Microsoft because they have 90 percent control over personal computing in both this country and in the world.

Make no mistake about it. Obama is using this crisis to effect the biggest government takeover of business outside of what has only been previously done in many 3rd world dictatorships. We still have 3 years and 10 months got go with this guy before, hopefully, he's voted out of office! God save capitalism in the United States!

Image of "Socialism Or Death" by templar1307's photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Why AIG is The Villain

When the housing market collapsed and faulty loan activity was exposed, it was only logical that the mortgage lenders, like banks, would be demonized for their risky behavior. But, in recent days, AIG, an insurance company (not a bank or mortgage lender), has been demonized even more; especially by our Congress.

I think a lot of people are mad at AIG (American International Group) because they received billions of dollars in taxpayer bailout money and they think AIG acted irresponsibly by giving out some bonuses. But, I don't think any lay person, who is now mad at AIG for those bonuses, really understands why an insurance company received that amount of bailout money in the first place; and, why they were said to have been "too big too fail".

If you listened closely to the Congressional hearings that were being conducted to grill AIG's interim CEO over the coals, you would have heard many angered references to the Financial Products Division of AIG and their receipt of $168 million in bonuses. But, again, most of us probably don't really know what the Financial Products Division did to warrant such anger.

AIG is basically an international insurance company that could insure almost anything in the world. 99 percent of what they do is regulated by some form of government; depending on what country or state they are selling their insurance products in. Normally, all their insurance activity has to be supported by a sufficient amount of cash reserves to guarantee that there is enough insurance payout money available in the event of a mass catastrophic loss of insured items. For example, when Katrina hit, a company like Allstate, because of state and Federal regulations, had enough cash reserves to cover all the insured properties that were lost to that specific catastrophe.

Not all of what AIG did as an insurer was actually regulated, however. This was especially true when it came to insuring mortgage loans, business loans, and many other types of loans. Not that they did anything illegal; but, in essence they were not being fiscally responsible.

The Financial Products Division was a very small division of AIG. It was heavily involved in the unregulated activity of insuring loans between two parties where the party receiving a loan might have had less than a good credit rating. Under normal circumstance, that kind loan would not have even happened if it wasn't for AIG providing an insurance on that kind of loan.

To facilitate these somewhat questionable loans, AIG insured that loan by using a product or vehicle called the Credit Default Swap or CDS. The first Credit Default Swaps were initially hatched up by JPMorganChase in the late 1990's. The fact that CDS's were exempt from any regulation stems back to the "Enron Loophole" that was created when Bill Clinton signed into law the Commodity Futures Modernization Act of 2000. That law was originally authored by Republican Senator Phil Gramm and, under the "derivatives" sections of that law, any CDS's were freed of any regulatory oversight.

In a normal mortgage loan environment, a borrower goes to a lender, like a bank, and says that they want to buy a house. The lender, then, in deciding whether or not they want give out a loan for that house, wants to know what the price of the house is; what the amount of down payment will be; and, what ability the borrower has to fulfill the terms of the loan. Up until the invention of the CDS, the lender assumed all the risk for giving out that loan. If the borrower defaulted on the mortgage, the house, which had been used as collateral for loan, would be taken and resold to recoup the money that the borrower lost on the deal. Even in the best housing market, a home loan that was defaulted on generally represented some amount of loss for the lender.

Now enter AIG with their CDS's. For just a small percentage of the interest payments that the lender will receive from the borrower on that home loan, AIG says that they will protect the lender against any losses that could result from the borrower defaulting on their loan. In effect, that insurance product, the CDS, would make the lender whole when there was default. The lender, then, becomes free of all risk. In essence, the real risk has been transferred to AIG. This transference of risk is technically what is called a "Swap" as the name Credit Default Swap so implies.This fact, alone, facilitated many more loans than should have been because lender risk was being eliminated. What has also been swapped at the same time was the borrowers credit rating for AIG's once-formerly excellent AAA credit standing. So, on paper, the lender looks as if they are only giving out loans to the best credit-rated borrowers. But, that was only an illusion. It is also important to note that AIG was fully exposed on their portion of the loan guarantee because the collateral for the loan remained, contractually, with the lender.

In a booming housing market, the CDS is a great profit-maker for an issuer like AIG. As housing values increased, AIG's risk would continue to lessen; and, ultimately, would go to zero. Yet, they would still get income. Over the life of a 30-year mortgage, it's nothing but a win-win for AIG. But, when the housing market collapsed and housing prices fell by as much as 50 percent, AIG was then on the hook for massive amounts of money as foreclosures rose. Further, they applied CDS's to all kinds of non-home loans and those loans, too, became a liability as this recession increased the number of bankruptcies .

But, it was worse than that. AIG wasn't the sole seller of CDS's. Banks also bought into the AIG/CDS scheme and they, too, started selling CDS's to each other for every kind of loan under the sun. Hedge funds, also, got into the game. So, as a result, you had everyone from AIG to world Banks to world Hedge funds who were covering each other's butts and none of them had enough cash to bailout the other when things started to unravel. It was a massive interconnected web that could easily collapse under its own weight.

That's why, when, last year, Hank Paulson and Tim Geithner originally started to look at the possible failure of AIG, they only saw a massive ticking, time bomb. But, this time bomb was a lot more like the small conventional charge that could easily be used to initiate a chain reaction that was akin to that in an atom bomb. And, that is why AIG could not be allowed to fail.

AIG is a big company with over 100,000 employees; worldwide. Most of what they do is both a regulated and quite ethical business activity. Even in the Financial Products division, I don't think that the majority of those people, who were selling and bundling the CDS products, were actually aware of how exposed the world was to their activities. After all, the housing market was just clocking along with ever-increasing house value. For sure, I hardly think that any of those employees of the Financial Products Division sought out AIG in some twisted belief that they could personally destroy the world's economy. Instead, they were just recruited to blindly do a job. I'm quite sure that they, like most of the employees in any corporation, didn't have any big-picture view that was greater than their own day-to-day activities. So, to demonize the employees of the Financial Products division is somewhat misplaced. The true villain in this mess is the management that allowed CDS's to happened without the substantial funding that was needed to cover all the expenses associated with a deflated housing market and a recession. That was the greed and that is where the anger should be aimed. Further, the fact that CDS's were even allowed to be sold all stems back to laws that were put in place in 2000. So, our Congress is to blame for not thinking through or actually reading the bill that Phil Gramm put forth and that Bill Clinton signed. And, Bill Clinton is at fault for signing something that his staff of experts -- now all part of the Obama Administration --- should have better understood.

Lastly, I have attempted to give you the most simplistic explanation of a CDS's as I could. The actual CDS products got more and more complex over time with different financing structures and various forms of hedging and leveraging. Because of these complexities and because of all the tentacles that have jutted out from this kind of insurance product, no one really knows the exact amount of risk that is associated with them. Currently, it is estimated that there is a worldwide risk of $45 trillion dollars; but, it could be a lot more than that. While Obama/Geithner want to impose regulation on these kinds of products, I am quite sure that the industry, itself, doesn't want to ever sell another one of them; seeing the extreme risk that they can carry. For this reason, I think excessive regulation isn't warranted. All that is really needed is to mandate some form of substantial loss reserves for the company selling the CDS.

Sunday, March 29, 2009

From ShamWow to the Hoosegow!

I don't know if Vince, that famous one-squint-eyed "ShamWow" TV pitchman, tried to use a line from his newest "SlapChop" commercial -- "You're really going to like my nuts" -- but he, along with a thousand bucks, did manage to coax a liquored-up hooker into his South Beach, Miami hotel room for what was supposed to be a little straight sex. I'm really surprised that such a fantastic TV pitchman like Vince wasn't able to cut a better deal than a $1000 for a drunked-up romp. Either she wasn't that drunk or he was totally wasted. Looking at the picture above, I'm thinking that the latter is probably the truth!

During the "act," Vince apparently decided to try out another one of his pitches and he pulled a Gene Simmons, of Kiss fame, tongue act on her. I think out of sheer horror, she chomped down and just wouldn't let go. I'm sure she felt like she was in the midst of that conception scene in the movie, Rosemary's Baby.

Vince, then, proceeded to beat the hell out of her until she let go of his mouth snake. Once freed, he ran to the cops and, then, to Vince's shock, they decided to arrest both he and the hooker. The cops only managed to retrieve $930 from the hooker's purse. That's 70 bucks shy of the $1000 that Vince claimed he gave her. Maybe, the missing $70 was for a "ShamWow" and "SlapChop" combo deal, plus shipping and handling, that Vince pitched her before having any sex? I'll bet that's it!

When I saw this story, I guess I wasn't too shocked. Somehow, I just couldn't imagine Vince as the family guy with a little woman at home who's SlapChopping all ingredients together to make a home made apple pie. I was, however, surprised to see him without that tube mike in front of his mouth. All along, I was starting to believe that it was an actual appendage.

It's nice to see that Vince isn't just a work-a-holic and that he is able to enjoy some really serious downtime. It's just too bad that a hooker's reputation had to be destroyed in the process.

Both Vince and his "date" were eventually let go with no charges being filed.

The image and the original story is from the Smoking Gun website (Click To See Real Story)

Note: The highlighted "ShamWow" and "SlapChop" references in the first paragraph are popup YouTube links to the original "ShamWow" commercial and a remixed, comedic version of Vince's "SlapChop" commercial.

Saturday, March 28, 2009

Is A Real-Life Soylent Green Society Just Around The Corner?

As I've said before, to be radical green and to fight the fight against global warming is to literally hate humanity.

Those green-eyed followers of Al Gore just hate all people; except, of course, themselves. That's because all "other" people do the most horrible of horrible things. They breath and expel carbon dioxide. They breed both poultry and cattle and -- Yikes! -- they eat them. Even more horrifying, those poultry and cattle are disgusting destroyers of the earth's land and our environment with their grazing, their smell, and their need for food. Then, too, people drive those carbon spewing and ugly things called automobiles and trucks. They destroy all of nature with their homes, their workplaces, and their roads. And, worse yet, they keep having babies! And they have the gall to call themselves civilized?

I think the best example of this hatred of humanity by the green ECO-nuts comes from the United Kingdom. Currently, the UK has about 60 million people and, horror of horrors, they will grow to 71 million people by the year 2030. Damn babies!

One of the small-minded "green" people who works for Prime Minister Gordon Brown, Jonathon Porritt, has now gone on record as saying that the U.K. must cut its population in half. This would not only save the planet but it would establish a U.K. population level that could sustain itself, food-wise, for many decades to come (See Full Story). Mr. Porritt also includes the United States in his assessment. I guess we keep having babies, too. We're sorry!

I don't know how Mr. Porritt thinks the population would be cut in half. If you simply force widespread sterilization, it would take quite a while for the population to recede and halve itself. That's because the death rate in most industrialized countries is about 2% per year. Anyway, if you did do that, you wind up with an aging population that would be all tied up in taking care of an even older, elderly population. Nursing homes, Polident and Depends would be the number one industries. So, that can't be the answer.

I personally think Mr. Porritt is talking about something else. I think he's thinking about euthanizing the elderly population along with some form of birth limitations. This would fit the insanity of all the ECO-nuts who are wildly running around, pulling out their hair, throwing rocks at coal-fired power plants, and trying to save the planet from humanity, itself.

My guess is that Mr. Porritt is an avid fan of the movie Soylent Green where the elderly are assisted in their own suicide so the remainder of the population can live and eat off food that is made from their dehydrated remains. That movie gave new meaning to the expression: "Is anyone up for Chinese?"

If that be the case, I would urge him to start the process off by pulling his Bentley or Rolls (I'm sure he has one) into the garage; close the door; leave the engine running while sipping some Earl Grey; and, then, end singing an emotional version of "God Save the Queen". How serene! That would still leave 29,999,999 people left to go. But, it would be a start!

Wouldn't you just love to sample a little Porritt meat with broccoli, rice, and muenster cheese; wrapped in a delicate puff pastry? Like Anthony Hopkins in the Silence of the Lambs, you could even say: "I ate his liver with some fava beans and a nice chianti!" Mmmm!

Image by Vanessa Pike-Russell's photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Friday, March 27, 2009

Greedy Wall Street or a Political Bunch of Bull?

As a country, we elect a President, 435 members of the House of Representatives and 100 members of the U.S. Senate to watch over our health and well being. We expect them to insure that our food supplies and the drugs we are taking are safe for us to consume. We expect them to protect us from all domestic and foreign enemies.

We very much expect them to make sure that our money and our finances are safe. Our government has supposedly set up a Treasury Department, a Federal Reserve Banking System, a Securities and Exchange Commission, a Commerce Department, A Department of Housing and Urban Development, and a whole host of financial oversights to insure that. Yet, none of them did their jobs and we now find ourselves in the midst of a financial collapse and the only thing our elected Representatives can say is that it was the fault of "Greedy Wall Street."

I, for one, am not buying that. That's because the Executive Branch and our Congress were asleep at the wheel. It's not Wall Street, it's our elected officials that are all at fault. But, politicians just love to deflect the blame. And, this one takes the cake!

While our representatives were having hearings on steroid abuse in baseball, the financial walls of this country were collapsing. Key members of the Senate Banking Committee were saying that Freddie Mac and Fannie Mae were just fine. But, thanks to campaign contributions, it appears there was too much "rose" in those rose-colored glasses.

George Bush and his Administration knew damn well that there were problems at Fannie and Freddie but miserably failed to forcefully bring those issues to forefront. Freddie and Fannie were well-populated with ex-Clinton people and, so, the senior Democratic members of the Senate Banking Committee did everything in their power to shield them from any investigation and exposure. From 2004 and beyond, key financial figures in this country were shouting out that the housing boom was a boom waiting to bust and our Congress wasn't even listening. All along, there were warning signs; yet, our elected officials were both deaf and blind.

The next time you hear the words "Greedy Wall Street," I would suggest you think, instead: "Partisan, incompetent, and corrupt elected officials who left the American people out in the cold!" That's where the real blame lies!

Image of the bronze "Charging Bull" (aka The Wall Street Bull) by sculptor Arturo Di Modica was taken by Christopher Chan for his Flickr site with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Thursday, March 26, 2009

It's Our Fault? Just Shoot Me!

According to immigration activists and most Democrats, it's our weak immigration policies that are responsible for the influx of illegal aliens from Mexico.

Now, Hillary Clinton also blames us for the illegal drug trade that is coming in from our southern neighbor. She claims it's due to "our insatiable" need for street drugs (See Full Story). To top all that off, the guns that are being used by the drug lords in Mexico are also our fault because we have such a cheap availability of guns in America; and, it's those guns that are making it across the border into Mexico.

Poor Mexico! If it weren't for us, they'd be "the" perfect country. At least that's what the Democrats want you and I to think.

When it comes to weak immigration policies, these are the same Democrats who want to block any immigration raids and immigration-busting walls and any other tougher immigration policies.

When it comes to drugs, it's the same Democrats who want to either legalize them or decriminalize their possession and/or their use. That'll sure stop drug trafficking!

Someone should tell Hillary that being hooked on drugs doesn't come "before" the availability of the drugs. We used to call drug dealers "Pushers" for that very reason. I guess, today, it's politically correct to just call them "dealers" because it's the users, now, that are doing the work of the pushers. But, it still comes back to the easy availability of drugs that are coming in from Mexico and Columbia.

As far as guns are concerned, and from what all I have ever read, the cheap guns and automatic weapons that the drug lords are using are generally Russian made. Some guns that "were" provided to the Mexican police and the Mexican military by our own United States government were ultimately resold or even given away to the drug lords by corrupt members of those entities. In fact, the U.S. went through a process of providing high-level tactical training for Mexican military personnel in the 1990's. Then, these Zetas, deserted the military, with their automatic weaponry, and became highly trained "hit men" for the drug cartels (See Full Story). Also, trained police have become turncoats to work for the cartels; taking their weapons with them. While some guns do come from this country, many more come in from the uncontrolled southern borders of Mexico. To me, the gun issue is just another "ruse" that's being used by the Obama Administration to further their intended gun control in this country.

I wish, for once, the Democrats would lay blame were it belongs and stop looking backwards, over their shoulders at Americans, when the blame-speak comes out of their mouths while they are sucking up to Mexican President Calderon. To be fair, the same was true with the Bush Administration and their dealings with the last two Mexican leaders.

The reason that Mexico is being overrun by the drug cartels is because --- Here me...Democrats! --- there are systemic government and societal problems in that country. Expatriation problems and drugs lords and their guns are just "symptoms" and not the cause.

The problems of Mexico stem from a corrupt economy; and, that didn't just happen, recently. The military and police are corrupt and have been for at least two decades (See Full Story) . The wealth of the country is highly concentrated in just a few hands. Drug trafficking has become the business of last resort because there are no other business opportunities. A majority of the Mexican population is involved in standing around trying to garner day-laborer types of work. That's why there are so many Mexicans that are willing to risk their lives to cross our border and find work in this country. If the economy was healthy, the drug lords wouldn't have gained as much control as they have, today. That's the bottom line.

If we, as a country, aren't willing to talk straight with Calderon on these issues, we will never jointly solve the problems in Mexico. If you look to our north, there aren't the same problems. Canada has the same evil neighbor as Mexico but they aren't being overrun by drug cartels and by daytime shootouts. They don't have millions of their people crossing our border to find work.

Hillary Clinton's blame of America is just another moronic argument from this Obama Administration.

Image of Mexican Policeman by dream2life's photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Wednesday, March 25, 2009

Could We Be Next?

Most every country has some debt and they cover that debt by issuing various forms of financially indentured instruments called bonds. In this country, we use Treasury Bills/Bonds (often referred to as T-bills and Treasuries) to float our debt. In the U.K., they have something called Gilts or Gilded-edge bonds.

In the U.K., just like in the U.S. with our bonds, Gilts are sold at auction on a pre-announced date. This morning (while we were sleeping), 1.75 billion pounds worth (or 2.55 billion dollars worth) of new Gilts were slated to be sold; but there were few buyers (See Full Story). This meant that the potential buyers were being scared off by an increasingly perceived risk that the U.K. would default on the terms of those bonds. That concern over risk is a direct result of all the debt that Prime Minister Brown and the U.K. government have been accumulating in trying to fight this recession. Sound familiar?

Every bond that is ever sold, whether it be a government or a corporate bond, has at least four key elements that are important to the buyer: the Issue Date, the Face Value, the Term, and the explicit Interest Rate. The Term is the period of time, in months or years, that the bond holder will be paid interest payments. Sometime this is referred to as the "Life" of the bond. The amount of each interest payment that a bond holder will receive is based on the explicit Interest Rate on the face of that bond. At the end of the Term, based on the Issue Date, the bond issuer will (should) buy back the bond from the current bond holder at its Face Value. If any of those terms are not met, the bond is said to have been defaulted on. Being in default is very similar to not paying your mortgage payments.

The Face Value of a bond is sort of like the "asking price" of that bond and, not necessarily the price that it will be sold for at it's auction. Usually, the Face Value is a round number like one thousand dollars; or, in the U.K., a thousand pounds. If the intended buyer or buyers of a bond senses risk, they will be less likely to buy that bond at its Face Value. At auction, when the risk is high, the bonds could bid down and sell for substantially less than their Face Value; or, worse yet, buyers won't even buy the bonds.

When a bond sells at less than Face Value, it is said to have been sold at a "Discount." When a bond is sold at "discount" is offsets the buyer's risk in two ways. First, when a discounted bond comes to Term, a profit is realized when the bond issuer has to buy back that bond at it's Face Value; a price higher than that of the original discounted price. Secondly, the holder of the discounted bond will be paid at the Interest Rate that is specified on the face of that bond. Because they bought the bond at a discount, the "effective" or implicit interest rate will be much higher than if the bond had been purchase at its full Face Value.

The fact that those U.K. Gilts failed to attract enough buyers should scare the hell out of us. We are floating trillions of dollars in debt by selling our Treasury bonds. If we don't have buyers to buy our bonds, it's the same as us not being able to get a bank loan to "tide us over" for our continuing operations. Even if we do have buyers, it will take more and more bonds to be issued in order to get the same amount of borrowed money. As a result, and at best, our government will have to pay higher and higher amounts of interest on our debt. At worst, with no buyers, we could literally go bankrupt for the lack of enough funds to keep our country going.

The Chinese, the biggest buyers of our bonds and our debt, have already expressed their concern over the risk associated with the high deficits that we are accumulating (See Full Story).

Mr. Obama and his gang should look at what happened in the U.K. as a clear warning signal. We need to stop all this excess spending, right now; or we, too, could find ourselves without buyers for our bonds and, consequently, in very serious trouble. And no amount of Leno appearances will save our tails if that happens!

Obama, The Socialist

Yesterday, in trying to research a blog entry about ACORN and their organizing of bus tours to protest outside AIG exec's homes, I ran across something about Obama's past that explains what is going on with Obama, now, our President.

Basically, in 1996, Obama ran as a candidate for the New Party in the City of Chicago. The New Party -- now somewhat defunct - - was a political party that arose out of the Democratic Socialists of America and received much of its primary support from, not surprisingly, ACORN; the group that spent a lot of time in getting out the vote for Obama in this last election.

The October 1995 newsletter of the Chicago chapter of the Democratic Socialists of America (CDSA) references the New Party in a section written by Bruce Bentley (See Archived Newsletter) and clearly identifies Barack Obama as a candidate for the New Party. This newsletter shows an undeniable association between the Democratic Socialists of America and the New Party.

Obama was one of only three New Party candidates that ran as part of the New Party in Chicago. Remarkably, it was a guy in New Zealand, not any American, and his "New Zeal Blog" that uncovered the facts of this story (See Full Story).

A few other sources picked up on it -- like NewsBusters (See Full Story) and World Net Daily (See Full Story) -- before last November's election, but the left leaning, drooling-over-Obama, main stream media of America completely ignored it.

In this blog, I have used the term socialist many times when referring to Barack Obama. My basis for doing so was solely based on what I was able to glean out of his stated programs. Now, it appears I was right in that assumption. Sadly, and probably intentionally, Obama's socialism had been suppressed to insure that Obama became President.

If you don't think that mandating executive pay, seizing companies and their assets, supporting a card check system for unionizing, and all the other plans that Obama has unveiled isn't socialism; then, you've got your head screwed on wrong. To understand all this anti-capitalistic, anti-corporation activity, you only have to link to the, still-active, New Party web page (See Full Story) and read the first paragraph of their stated intention/platform.

Lastly, I would highly recommend that you thoroughly go through the New Zeal Blog link of above. There are numerous links on it that further expand on this story.

Tuesday, March 24, 2009

Obama's Got Oil On The Run!

He's got oil on the run, alright! On the run up...that is!

Just before Obama announced his budget and energy plans, oil was closing in on $33 a barrel. Today, a doubling of that number doesn't look too far away with the oil futures now trading around $54 a barrel and climbing fast (See Oil Chart from WTRG.com). This is despite the fact that we and the rest of the world are in the midst of a recession and world oil consumption has come way down.

Apparently, the oil traders of the world have looked at Obama's energy plans and see oil as an investment and not the liability that Obama's plan should have created. The reason for this is that all of Obama's green energy plans are focused on attacking the coal and natural gas industries and not oil consumption.

I agree with the traders. We aren't going to see any substantial reduction in oil usage over the next two decades or even longer. By not increasing our domestic supplies, we will continue to become increasingly dependent on foreign oil as our own resources dwindle to a mere trickle. We will only pay more and more for what is an ever increasingly scarce commodity. For every barrel of oil we save in this country, the Chinese and Indians will eat that up exponentially as their economies and their affluence grows. We have millions of gasoline-powered cars on the road and it will take nearly two decades to replace them through normal attrition. The likelihood that hybrids will have the same long-term usable life as compared to the pure gasoline cars of today is somewhat questionable due to the high cost and frequency of having to replace batteries. Battery-powered cars will also be expensive and the electricity to charge them will only get more and more expensive under Obama's plan.

My guess is that we will continue to increase our demand for imported oil through 2030, or even longer, as this country grows and as our own domestic oil supplies wither away. I will bet, that in 4 years, we will be importing substantially more oil than we already are and the price will be well over $150 a barrel. I don't think it is unreasonable to believe that we may see highs in oil of $80 a barrel this year. This is especially true because the United States dollar continues to tank over inflation fears and the price of oil moves up as our dollar, a worldwide reserve currency, continues to sink.

Of course, this is a somewhat educated "guess-timate" on my part. If there is a substantial or greater collapse of the world economies this year, then all bets are off. In that case oil prices could fall dramatically.

The oil barrel image by yuan2003's photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Monday, March 23, 2009

More Insanity!

For the last two months, Obama and the Democrats have literally attacked the "greediness" of Wall Street companies and our Banks. For those businesses who took Federal bailout money, the Democrats and Obama have been very heavy handed. These companies have been condemned for their normal business activities. They have had their executive salaries capped. Additionally, bonuses are about to be taxed at an onerous, retroactive tax rate of 90 percent.

This has forced some companies into publicly stating their regret in taking the money. The imposition of salary caps and onerous taxes will probably cause a "brain drain" from our entire banking system; for fear that future Congressional and Administration actions will affect their pay. I'm quite sure that some companies, who are on the brink of failure, are avoiding asking for bailout money because they have seen what happens when others have taken that money. Couple that with the proposed high taxes of the new Obama budget and our government is seen as nothing but an adversary to corporate America and the wealthy. Additionally, the Obama/Congressional eagerness to punish corporations for their lavish habits is also hurting other businesses like the hotel industry which depends on conventions and corporate meetings and junkets (See Full Story)

Now enter little Timmy Geithner and his plan to save toxic assets with his new "Public-Private Investment Program" (See Full Story). He proposes that the private sector, Wall Street and the Banks, partner up with the Federal government to buy up all these distressed assets that are seizing up our credit markets.

Give me a break! You can't go to war with Wall Street, the Banking system, and the rich and expect those entities to, all of sudden, be your buddy. They've seen what has happened when companies have partnered with "this" Federal government. Even if those companies do manage to get some assurances from Geithner and Obama that they will not see any imposed restrictions on them, there's no guarantee that the Democrats in Congress won't retroactively come after them later on. If you're a company in America, working with this government is like inviting a hungry, wild, unleashed lion to your dinner party.

All Americans are in this recession together. We need everybody, the rich, the corporations and business community, and the citizenry to work towards the resolution of the economic disaster. Yet, division is the game that is being played. This is just insane!

Obama's Executive Pay Insanity

Apparently, this is a President who wants to absolutely control and tamp down executive pay and compensation for all of corporate America (See Full Story). At the same time, he proposes that we raise taxes on those people making over $250,000 so he can pay for all his budget-busting social programs.

Does this make as much "nonsense" to you as it does to me?

Obama needs those big salaries. If he doesn't have them to use as his taxable feedstock, you and I are going to be the ones paying for all of his big socialist government plans. Of course, we will anyway because there already aren't enough "rich" in America to pay for all his crap.

Isn't socialism fun? Like Obama and his gang always said: "Never let a good crisis go to waste!" Or, perhaps, it should be stated this way: Always use a good crisis to setup an even bigger one!

Personally, I think what appears to be insanity is the real plan; from the get-go. In which case, Mr. Obama is a lot like the reptile as seen in this picture!

Image of a two-headed King Snake is by Jason Pratt's photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Sunday, March 22, 2009

How To Kill The "Party of No" Label

The Republicans have to be careful these days. They are getting slammed with this "Party Of No" label that the liberal politicians seem to be proliferating with the gleeful help of the left-leaning media in this country.

Obama is effectively using things like the Internet and the Leno show to give the appearance of transparency; albeit, just that, an appearance. His various websites are really just intentional distortions of the truth; just like some very successful used car salesman. But, even so, America has the opinion that Obama is being forthright and that's the challenge for the Republicans to overcome.

Even though Obama is probably the greatest political illusionist that this country has ever seen (beating Bill Clinton, hands down), the Republicans have to fight fire with fire. They have to be aggressive in getting their thoughts out in writing. The old days of 20 or so Republicans standing before a microphone at "2:00 o'clock" on a Washington afternoon to complain about some Obama spending plan isn't going to do it. That just helps stick the "Party of No" label to their foreheads.

The fastest and greatest overthrow of a dominant political party in America was accomplished by Newt Gingrich and his "Contract with America." That "contract" was a written document. Just like Obama's websites, it was out there for people to read and to see. It seems that the Republicans have forgotten the power of that simple Gingrich act. They really need to get back to it; and, quickly.

The first thing that they need to do is recreate the "Contract with America." This time the contract should clearly address the things they think will get this country going again. It should be in a very simple in form by, first, laying out the problem and, then, giving a succinct solution. The key is simplicity so that they don't lose audience's attention. It should be no more than 10 bullet points in total.

The "Contract" should, then, reference a website that would have more detailed information so that anyone, so inclined, has a place to conveniently go. The website should be non-specific to the GOP and more specific to America and Americans. For sure, the website should not have either GOP or Republican in its title. Certainly, a GOP logo or two on that site would be alright. Sometimes the sheer mention of a political party can be a turnoff for some on the other side of the aisle. The site could be as simple as "Americans for America dot gov."

Every single Republican has to have that contract and the website on the tips of their tongues. There should be no stupid Biden moments like the one where he couldn't remember the web address of Obama's primary website: Recovery.gov. Every time a Republican is interviewed or gets any camera or microphone time, they need to reference it. This is what the Democrats do so well. When it comes to policy and labeling their opposition, they are true automatons; one and all.

Right now, you can't listen to a single Democrat being interviewed without the word "transparency" being used with almost gagging regularity. Before that, it was the incessant use of the word "change". During the run up to the 2006 elections, the constant drumbeat by Pelosi and the Democrats was the use of "culture of corruption" whenever referring to Bush and the Republicans; and, the label seemed to stick. They are doing the very same thing, today, with the "Party of No" chorus. The key word or phrase repetition works and the Republicans should finally wise up to it.

The bottom line is that simple things work for a voting population that is too busy to understand or dig into the complete ins and outs of politics. I believe the Republicans can win again through a well-developed and straight forward plan that is kept simple for anyone to understand. And, that's just my opinion.

Saturday, March 21, 2009

Was AIG Used As A Strawman?

This morning, anyone who read The Drudge Report would have seen this picture and the bold printed "REGULATE" title at the top of the page. Right now, it is just a teaser without a detailed story behind it. But from the top line heading that appears above that picture, it implies that the Obama Administration is preparing to REGULATE banking and Wall Street salaries and bonuses. And, maybe, even, all corporate pay.

This brings me to a question: "Was the AIG flap a completely "fabricated" strawman which will allow Obama to do what he always wanted to do...control executive pay in America" Was this entire flap allowed to happen in order to move towards the complete regulation of salaries in this country? Don't forget those infamous words of Rahm Emanuel: "Never let a good crisis go to waste!"

You've got to wonder. Is this just the first step towards a broader and even more expansive form of socialism than that which exists in the socialist governments of Europe? This move by Obama is absolutely disturbing me; and, it should be seriously disturbing to all Americans who believe in the benefits of a free enterprise system.

$168 Million Bucks That Stop At Obama's Desk

Senator Dodd blames Obama's Treasury Secretary, Tim Geithner. The White House says it's Dodd and AIG's fault. Representative Maxine Waters is blaming Dodd, Tim Geithner, and the President (See Video & Audio).

It's almost like a scene out of a Three Stooges' movie with Congress slapping the White House and AIG; the White House slapping Congress and AIG; and Maxine Waters slapping everybody as if she was dragging a stick across the slats of a picket fence. You can take your pick as to which group looks more like Moe, Larry or Curly. But, my bet is that Maxine Waters is more like Moe because she's the smart one out of this whole mess by claiming that the President is out of touch.

If you note, the Republicans are increasingly backing off; letting the Democrats dogfight themselves. The expression "eating their own" would be an understatement.

When it's all said and done, it will be Obama that suffers the most. It was his Treasury Secretary that presented the bailout targets and the specific amounts to Congress. He was even involved in the original TARP bailouts because it was him, Hank Paulson, and Bernanke that worked on all of the bailout monies that were handed out in 2007. Obama certified that past activity of the Bush Administration by hiring Geithner.

Therefore, with Obama as the target, you can easily say "the buck stops here." In this particular case, it's $168 million bucks that are stopping in Obama's face.

What is really interesting is the idea that such a relatively small amount of money (as compared to other "trillions" that Obama is spending) may hurt this President the most. Like someone once said: "I's the little things that matter!"

Friday, March 20, 2009

AIG Bonuses: It's A Contract, Stupid!

The days of a contract being someone's good name and a handshake are long gone. In today's complex and litigious society, the legal and binding cement that keeps two parties honest is the contract.

Like it or not, the people at AIG, that received those retention bonuses, got them because they had a contract. That contract was a legal agreement between AIG and themselves. Those contracts were done as part of conducting normal business activities and were negotiated in good faith between AIG and each of those employees. The fact that AIG received bailout funding from the Federal Government can't negate those contracts because they were written before AIG accepted that funding. Anyway, the acceptance of Federal bailout money was a contract between AIG and our government and was totally independent of those retention bonus contracts.

Our Congress knew this and knew that they couldn't override those legal documents by, somehow, passing a law that would retroactively negate them. That would definitely be unconstitutional. So, the Democrats in Congress and some obliging Republicans decided to do an end-around by passing legislation that would penalize the recipients of those bonuses with a 90 percent, retroactively applied tax rate. Even so, that action may be unconstitutional, too, because it may violate Article I, Section 9, of our Constitution by passing legislation that could be defined as a "bill of attainder". A "bill of attainder" is the passage of any law that would specifically target and punish a single person or select group of people. Whether or not our Congress' actions are unconstitutional, will depend on whether or not the focus of yesterday's legislation is too limited in its scope.

This could have all been avoided if Chapter 11 bankruptcy had been allowed to happen. In that case, all those bonus contracts would have been null and void under our existing bankruptcy laws. But, if you recall, the bailout was needed because AIG was another one of those companies that was too big to fail. That was our government's choice in this whole mess. By doing so, the Federal government allowed all the preexisting AIG contracts to stand. Now, it appears we want to pick and choose those things we don't like about AIG's business and we want to do so retroactively.

AIG isn't at fault here. All this anger is totally misplaced. We, as the people who elected our current representatives to govern us, are at fault. Our representatives were too stupid to think through all the consequences of bailing out this company and now they want to change the rules to divert attention away from their own stupidity. When our government "unconditionally" gave money to AIG, they did so in good faith and AIG accepted it without a lot of detailed strings attached. That was our fault.

What was done, yesterday, by our Congress, shows what little regard our representatives have when it comes to the rule of law and the importance of established, legal contracts. And, this isn't the first time. Right now, there is a mortgage "cram down" bill working it's way through Congress that would totally obliterate mortgage contracts by allowing a Federal Judge to set new contractual terms and that would, in effect, only benefit the homeowner and not the lender.

In a similar attempt to thwart an international agreement, the Democrats in Congress ignored the contractual commitments of NAFTA and have now blocked Mexican trucks from entering our country to bring in Mexican goods for sale. As a result of that action, we have had trade tariffs imposed on 90 U.S. goods and products being exported to Mexico (See Full Story).

Another form of contract that was dissolved, and by Obama himself, occurred when he declared that companies receiving bailout funds must restrict their executive pay to a $500,000 ceiling. I don't know about you, but when I went to work for a company, they made an offer of a specific salary and I accepted that fact. That was a binding contract under the labor laws of this country. But, now, Mr. Obama seems to think employment contracts mean nothing anymore.

How many more contracts is this government going to void? Obama and the Democrats talk about the importance of the rule of law when it comes to protecting the terrorists at Guantanamo; but, they seem to ignore the same rule of law when it comes to protecting Americans in America. Are we now moving to some form of a lawless dictatorship or a communist-like Politburo? It's sure starting to look that way!

What Obama's Climate Saving Plan Will Cost You

Obama, like most Democrats, is chin-deep into the belief that we need to save our planet from ourselves. For that reason they plan to control America's carbon dioxide output through the implementation of a "Carbon Cap And Trade" taxing system (See My Previous Blog Entry).

For now, putting aside the whole argument of whether or not man-made Global Warming is even real or just a bogeyman, let's just focus in on costs that you and I will all have to pay to save our planet.

Obama, the U.S. Senator running for President, co-sponsored a "Cap and Trade Bill" in the U.S. Senate and said that the cost to America would be a only about $366 billion dollars per year. But, even so, that would mean that every man, woman and child in this country will have to cough up more than $1200/yr to save the planet. For an average family of four, that's over $4,800 a year. That cost will be passed on to us in the form of higher energy and product costs from companies that are being penalized by "Cap and Trade".

Then, Obama, the President, says that number needs to be upped to $646 billion a year as reflected in his recently submitted budget of only two weeks ago. So, now, the average 2-child family will be on the hook for over $8,600 a year to fight Global Warming.

But, then, (Oooooops!) the new cost that is being bandied around by the White House is closer to $2 trillion a year (See Full Story). That means that the cost to the average family is now estimated to be over $26,700.

According to Wikipedia, the average salary was about $50,233 in 2007 (See Full Story). That means that Obama's plan will effectively eat up more than 1/2 of the income of an average single-wage-earner family.

My first concern is whether or not we can even trust the $2 trillion number, anymore? After all, the initial $336 billion number had to be doubled. Then, that number, had to be more than tripled to $2 trillion! What's next? Quadruple the $2 trillion number to $8 trillion? These numbers are just exploding in size and within a relatively short span of time.

When it comes to numbers accuracy, Obama and his people can't seem to be trusted (See my previous blog entry on Obama's numbers game). Don't forget, this is the guy who claimed, just last year, that he would create 4 to 5 million new jobs. Now, we're down to only saving, maybe creating, a couple of million.

Also, it isn't just Obama who wants to dig into our pockets to save the planet. The United Nations is on the verge of setting up a global tax on every barrel of oil with the idea that it will raise almost $800 billion dollars a year to fight global warming and revive the world's economies (See Full Story). Since this country uses about 25 percent of the world's oil, the average American family will have to chip in another $1000 a year to fight this silly fight.

What is really sad about all this Global Warming crap is the fact that, for every carbon footprint that you and I save in the United States, the developing countries like China, India, Indonesia, and those in South America and Africa will "offset" that carbon savings, in spades, with their own, new carbon dioxide output as their own economies continue to grow. Someone should explain to our legislators and to those in Europe that our atmosphere has no territorial boundaries. Just maybe, the carbon dioxide output in China will ultimately work its way all around the world. Ya think?

Thursday, March 19, 2009

The U.S. Dollar: Where's The Woolite?

Yesterday, the stock market euphorically rose by as much as 176 points on the initial news that our Federal Reserve was going to "spend" up to $300 billion in order to buy back $300 billion of it's own debt (See Full Story). If that sounds like double talk, it certainly is! It's sort of like paying off your mortgage with your own credit card and having no money left to do anything when the credit card bill is due. But, if you're the Federal Reserve, you can just float more debt to do what you want to do. It's like creating "new money out of thin air" as noted in this news article: "Fed to pump another $1 trillion into U.S. economy". If you or I did the same thing, they'd call it "kiting" and we'd be serving "20" in some Federal prison. And, for sure, Bernanke and the rest of his gang at the Federal Reserve might be just as criminal in doing what they are doing.

On top of the $300 billion to buy back U.S. bonds, the Fed will use an additional $700 billion as a systemic cash infusion in the credit markets to free up borrowing for homes, cars, etc. Again, this $700 billion doesn't really exist; except, in the minds of the Federal Reserve.

By doing this, its like washing all of our currency in hot water and harsh detergent. Just like a cotton shirt, there will be some serious shrinkage. And, with shrinkage, comes inflation.

There's a big gamble doing what the Federal Reserve is doing. They are trying to combat a deflationary economy by adding in to it their own inflation. You can literally see that there is deflation when you look at home prices having fallen by as much as 50 percent. Deflation is also apparent as retailers are attracting buyers with deep discounts. Automobiles are being sold at losses to reduce inventory. So, by introducing inflation into our economic system, the hope is that prices will stabilize and credit purchases will start moving again.

The problem lies in the fact that the deflated dollar will remain deflated; even after prices recover. Then, the inflation that was used to fight deflation becomes its own problem. The only way to fight this new evil is to seriously raise interest rates; which, in itself, could cause another recession. But, this time with rampant inflation. As a result, simply raising interest rates won't solve the inflation problem. For that to be solved, we will, somehow, have to quickly erase our accumulated debt though heavy taxation so that the Federal Reserve can reverse and undo what they did yesterday by pulling back dollars from the world's debt markets. But, in the wake of all this, we could literally see double digit inflation on everything that we buy; and, for a long period of time.

Just so you know, this kind of thing has been tried before by other countries and those governments don't exist today. They just collapsed. So, this is a big gamble.

In reaction to that potential, the stock market ended today with a loss as the investment community finally saw the risk that exists in this program (See Full Story). Since the announcements of yesterday, gold prices have jumped nearly $80 an ounce as people sought the yellow metal as an inflationary hedge. The U.S. Dollar fell against other currencies; making imports more expensive for us to buy. Oil prices jumped to a new 2009 high of nearly $52 a barrel. If the Fed wanted inflation, it certainly didn't take long for it to start showing up.

Make no mistake about it, this is a seriously desperate move on the part of our Federal Reserve. The risks are high and rewards might be questionable. I can only believe they are doing this because they are seeing statistics and trends that are more worrisome than had been previously thought. Don't forget. This action is independent of the so-called trillion dollar Stimulus Package; which, by all indications, seems to be having a difficult time in starting up.

I personally don't know how we are going pay for all this debt. It just might take over a century or more to do it and that could hurt the future of this country.

Sex Ed Is Failing In America

Earlier this week, it was announced that the birth rate for 2007 broke the previous baby-boom record that was set in 1957. But, disturbingly, the out-of-wedlock birth rate also hit a new high. We are now seeing unwed motherhood at a rate of 40% of all births (See Full Story).

Obviously, the progressive viewpoint of providing sex education in our schools and the movement towards handing out birth control isn't working. And why should it? We've got an educational system in this country that can't teach the basics of reading and math, and somehow, we expect that same system to do a good job in teaching sex ed?

The progressives and liberals always feel that the State is the better educator in all matters and not the parents. But, just as welfare recipients became habitually comfortable and dependent on a welfare system and had no desire to break out of that system by finding a job, our parents, too, have abrogated all responsibility for sex education because they, too, have become absolutely dependent on the "system" to do it for them.

As a consequence, we have a teen population in America, today, who is in the wilderness between knowing how to have sex but, without the values and risk information that had been previously taught through proper and continuous parenting and through the moral anchoring that was often found in religion.

Being an unwed mother is one the greatest life changing events that can happen to a woman; especially at the lower ends of the economic scale. Often, it is the reason for girls not to complete their high school education. Many times it is the sole reason why women have to live their entire lives below the poverty level.

I just think that we, as a country, need to revisit the whole concept of sex ed. It isn't working and it either needs to be abandoned completely or seriously reworked. For years, astute parents have been crying out for abstinence to be taught and their voices have been ignored. Because sex ed has become such a failure, unto itself, the trend now, is to overcome its failings by handing out free birth control. When that doesn't work, are free high school abortions the next step?

One way or another, the parents have to be brought back into the process of sex ed. Obviously, the old saying of "if it ain't broke, don't fix it" doesn't apply here!

And, that's just my opinion.

Image by mahalie's photostream on Flickr with Creative Commons Licensing. Some rights retained. (Click to View Other Works).

Wednesday, March 18, 2009

And So, The Trade Wars Begin!

We already know that the Democrats and the Obama Administration have refused to sign free trade agreements with both Columbia and South Korea (See Full Story). As a result, we, as a minority manufacturer in the world, are limited in the amount of products that we can sell to those specific countries. It puts us at a cost disadvantage in trying to compete with other countries that already have free trade agreements in place with South Korea and with Columbia.

During last year's campaigning, Obama had mentioned that he might renege on and renegotiate the NAFTA trade agreement between us and Canada and Mexico. That resulted in both Canada and Mexico getting into a tizzy. Obama had to soften that stance by sending out a representative to say, in effect: "Not to worry...it's just politicking!" (See Full Story) Then, when the Stimulus Package was being rammed through Congress, it included a "buy American provision" that got the European Union in a lather. In both situations, the intent was to appease the labor unions. However, in both cases and only after seeing the backlash, Obama appeared to reluctantly back off.

I hardly think that all these stuttered attempts to block free trade are just "politicking". The Obama Administration is aiming to stifle free trade and create the kind of protectionist atmosphere that would provide a short-sighted and short-termed benefit to our labor unions. But, many economist think this would ultimately result in the same kind of trade wars that caused and sustained the Great Depression (See Full Story).

Since Obama has been in office, he and his gang of Democrats have consistently made every attempt to satisfy the wishes of the labor unions when it comes to international trade. One such attempt that has already seen blowback was done to satisfy the Teamsters Union by blocking Mexican trucks from entering our borders to bring products in from Mexico. Under the Bush Administration, this had been allowed on a limited basis. But, as a result of Obama's short-sightedness in rescinding that practice, we have now been slapped with trade-limiting and trade-preventing tariffs on 90 products that are being shipped into Mexico (See Full Story). At a time when this country is already in deep recession and when many of our companies have seen their international sales plummet, we are now unable to competitively sell many of our products to Mexico and we could easily see a loss of $2.4 billion in export sales.

Mark my words, this kind of thing is only going to set up a lot of distrust between ourselves and all of our other worldwide trading partners. Those countries that we trade with can't help but ask themselves: "Are we next?"

We are not in a position to start dictating trade. Americans buy more imported products than we sell overseas. That's why, for years, we have had billions of dollars a month in trade deficits. If protectionist trade barriers go up, the American consumer will be the only loser because we will have to pay more for all those imported things that we love to buy. That's inflationary and it will hurt the poor the hardest. On top of that, our products will be less attractive to foreign customers because they will be more expensive than products from other countries. That could result in lost American jobs.

Maybe that's the plan. Maybe Obama wants to force Americans to buy only American by causing the prices of imported goods to rise. But, if that is the plan it is definitely a dumb one and, believe me, one that will hurt us more than help us.

In my opinion, we have lost manufacturing jobs in this country because of a variety of reasons; and, high labor rates is just one of those reasons. But, more than anything, it is our system of taxation that is the most crippling. I still believe that, if we went to some form of consumption tax and not an income tax structure, we could be more competitive in the world because our American products wouldn't carry all the burden of employee and company income taxes that are being applied throughout the manufacturing, distribution, and sales processes. Additionally, a consumption tax would have a fairer and more equal effect because taxes will be applied to both domestic and imported goods, equally. Today, imported goods go untaxed by this country until they actually reach our shores and are finally sold.

Protectionism isn't the way to increase domestic manufacturing and regain manufacturing jobs that have been lost to other counties. But, a new tax structure might. I only wish that our politicians would come to that conclusion before all of our manufacturing jobs go overseas.

Tuesday, March 17, 2009

AIG Bonuses: Another Diversion

The $168 million of taxpayer money that is being used on bonuses for the AIG execs may be worth some outrage but, in contrast to all the other billions and trillions of possibly wasted taxpayer money, it is just a "gnat" in the grand scheme of things.

Right now, there is widespread outrage, from both the right and the left, over the AIG bonus thing. Where was that same outrage when billions of wasted dollars were uncovered in the first TARP bailout? Where was the outrage over nearly $10 Billion (not millions of dollars) that were being spent for pork projects in the recent $410 billion spending bill? And, why not the same outrage over Obama's $3.7 trillion dollar budget proposal or his $800 billion not-so -stimulus, Stimulus Program? Neither of which is hardly targeted to recover this economy!

With AIG, we are literally crying over a couple of grains of rice that have fallen off a wheelbarrow full of rice that is destined to be dumped over a cliff. We have completely lost our focus. For the Obama Administration, the AIG bonuses debacle is just what they wanted. It focuses America's anger on AIG and takes the heat off of them for all of their own wasteful spending. Believe me, this is a political diversion that is both intentional and welcomed.

This whole thing with the AIG bonuses reminds me of an "Everybody Loves Raymond" episode where Raymond's brother, Robert, has fallen on some hard times and is only eating bologna at every meal in order to get by. Raymond and his wife, Debra, decide to give him $1000 as a loan. However, because Robert doesn't want to be indebted, he refuses the money. Then, Ray and Debra, still feeling sorry for Robert, just decide to give him the "thousand", outright, as a gift. As the story proceeds, Robert decides to use the money for a vacation in Las Vegas instead of using that money to improve his lifestyle. As a result, Raymond and Debra get angry and want the "gift" back. However, Robert says "no" to returning the money and reminds them that it was given as a "gift" and not as a loan and without any strings attached. The story ends with Robert still going to Vegas but now, with Raymond as a travel partner. Sound familiar?

The problem with all these monies that are being spent by our Federal Government, specifically by Obama and by our Democratic Congress, is that we are sending money, out the door, with absolutely no strings attached and with little thought behind it. Therefore, you wind up with all the corporate Roberts of our world going to Las Vegas on the taxpayer's dime. Then, after the fact, we start asking for the money back or we start trying to attach the strings on how that money will be spent. This is just ridiculous and, surprisingly, it takes the plot of a decade-old situation comedy to remind us of that fact.

Right now, the Obama Administration is just starting to write the rules on how the stimulus program monies will be spent and we and the recipient states are just now starting to find out about rules. However, some of that stimulus money has actually gone out the door without those rules in place. There's an age-old adage that says "haste makes waste." Believe me, the AIG bonus waste will look like child's play as compared to all the other waste that we will ultimately see when the stimulus money has all been spent and after Obama's trillion dollar budget money goes flying out the door. Waste is just commonplace in Government programs. For many years, the Medicaid/Medicare program waste has been running at a rate of about 14% per year and no effective means of abating it have ever been instituted. What makes us think that the Stimulus Program or Obama's fat budget will be any different?

This article from the Washington Post "Anger Over Firm Depletes Obama's Political Capital" seems to say it all about the outrage. But, in addition, it seems to show that a lot of that anger may now be aimed at Obama and the Democrats.

Monday, March 16, 2009

The Blame Game

On almost every Sunday morning television talk show this last weekend, Democratic members of Congress and personnel from Obama's Administration made sure they laid blame on the Bush Administration and on Wall Street's greed for the economic mess that they have "inherited". Obama, himself, had made sure that he used the "I-word" ("Inherited") every time he got his face in front of the cameras last week.

But, if Bush is so at fault, why aren't there any hearings or investigations being conducted to determine "what" he and his Administration did to create such a mess. Shouldn't we know the how's and the why's that caused us to get to this point? Certainly, by bringing those facts to light, old laws could be changed and new ones written to avoid this from ever happening again.

But, nothing has happened or is happening; and that's amazing to me. This is the same Democratic Congress that has investigated almost everything that the Bush Administration has done over the last 8 years. They are currently dragging Karl Rove and Harriet Miers in front of a Congressional hearing to publicly flog them over the firing of a few attorneys in the Justice Department (See Full Story). But, when it comes to a whole nation that is losing their jobs and their homes, there are no hearings or special investigations. What gives?

I think that there are no hearings being conducted because those hearings would show that the Democrats, at the very least, are complicit in creating this economic disaster. Maybe, even, exclusively at fault. I think, too, that hearings are being avoided because some past Democratic Presidents, like Carter or Clinton, could be implicated.

Because the housing collapse and subsequent recession occurred under Bush's watch, it is politically more expedient to use the "blame game" to attach the blame to Bush without possibly getting yourself dirty through actual hearings. As long as there isn't any public outcry to have investigations, the Democrats can only assume that the "blame game" will continue to work for their benefit.

My guess is that there will never be any hearings. The Democrats will, out of self preservation, avoid them at all cost and they are the ones in control. The only way we will actually find out what happened will be through years of independent analysis and through various forms of investigative journalism.

Sunday, March 15, 2009

Jim Cramer: Skewered by Jon Stewart

Does anyone remember "Joe The Plumber" these days? If you do, you would remember that his simple beef about Obama's raising taxes was turned into a personal attack on him about unpaid taxes and his ambitions to own his own business; including an attack by Obama himself. This is a tactic that is used, all too often, by those who call themselves Democrats. The intent is to divert the attention away from the substance of a message by focusing in on some personal failings of the messenger. It's the age old, "shoot the messenger" tactic.

In the last two weeks, a Democrat and CNBC host, Jim Cramer, has suffered the wrath of his own political party in the same fashion as Joe the Plumber. This time, Jon Stewart of the Daily Show decided to attack Jim Cramer because Cramer dared to support Rick Santelli in his rant against Obama's unfocused resolution of the recession and the bailout of irresponsible borrowers. It was Joe the Plumber, in spades, all over again with Stewart focusing in on Cramer's stock picking faults and not on what he had said about Obama's policies. When it was all over, no one could remember why Cramer warranted the Stewart attack. The only thing that they knew, now, was that Cramer was a buffoon and a failed stock picker.

Jon Stewart is an Obama backer and a Democrat and gives no disclaimer to that fact. He used his nationally televised show as a means to defend Obama by destroying Cramer. He stepped off his normal comedic commentary and his joking about the daily news to launch a leadpipe-to-the- knees attack on Cramer in order to bring him down personally. Prior to that, Stewart had also attacked Rick Santelli. Apparently, Santelli and Cramer's messages were a little too truthful for Stewart to stomach.

I'm not defending Cramer's stock picking abilities or his theatrical way of presenting that information. That's for his viewers to decide. However, I am defending his right to have an opinion about anything that he wants to talk about without his personal failings being put on display to denigrate him. That's what we used to call "Freedom Of Speech" in this country. But, today, the Democrats know they can shut down that freedom by undermining those who speak out against them. Notice that, nowhere, did Jon Stewart ever attempt to defend the policies of Obama that Cramer and Santelli spoke out so passionately against. Instead, he went out with blazing guns to shoot down and destroy Cramer's character. When Cramer finally got on the Stewart show, it was all about Cramer defending himself, personally, against the Stewart attack. Gone, completely, was the whole issue of Obama's policies that started the whole thing. Stewart and the left won and Cramer was intentionally destroyed.

Once again, the left was able to destroy someone. They did it with Joe the Plumber, Rick Santelli, Sarah Palin, Jim Cramer, Juan Williams, and so many others in the past. It is a "James Carville" tactic that grew out of the politics of the 1990's. It works; and, because it works, it is intended to shut down anyone who would oppose them, on the right, or even the left, by tarnishing them personally. In doing so, it leaves a battlefield of strewn carcasses as a warning to anyone else that may speak out against them. Sadly, our dumbed-down American voters can't seem to see through this tactic!

It is interesting that Stewart only stepped out of his comedic element when he thought he seriously needed to defend Obama against Cramer. To me, Jon Stewart is no different than Bill Maher. But the difference is that Bill Maher doesn't hide the fact that he is an avowed liberal and that his humor is intentionally aimed at attacking the right. Stewart is a lot less truthful when he, on a daily basis, intentionally levels a lot more comedic attacks on those on the right than he does those on the left. In essence, he's a sneak! And, that's just my opinion.

Saturday, March 14, 2009

Card Check: The Silencing Of Management

I think by now, a lot of Americans have heard about the proposed change by the labor unions and the Democrats to eliminate secret balloting when a company's employees decide to unionize. This change in the collective bargaining laws is called the "Employee Free Choice Act" or EFCA. It is also more commonly known as "Card Check". (See Wikipedia's Coverage of this topic)

No matter what you call it, those who object to it are usually against it because it abandons the democratic process of voting in secret. It is this process of secret balloting that has, for decades now, prevented either management or any union personnel from adversely influencing the outcome of the vote through some form of intimidation.

But from my perspective, EFCA is even more undemocratic than any simple elimination of a secret ballot. That's because EFCA will completely silence management's voice in the process of a company becoming unionized.

Here's why...

In today's process of unionizing, if at least 30 percent of the workers want to unionize, then the National Labor Relations Board (NLRB) is advised of that fact, and that agency will organize an election that is, by law, to be held within 90 days of that notice. In the process of preparing for that election, both management and the Union are given the opportunity to conduct employee meetings to discuss the pros and cons of unionizing. Following that, an election is held. Also, under the current law, if more than 50% of the employees have "card checked" their desire to unionize, the employer has the right to either have a secret ballot election or, simply, declare the company as being unionized without any election. But, please take note: Management is still involved in the process; even if the majority want to unionize. Furthermore, until the NLRB is involved in the process of establishing an election, it is illegal for company management is dissuade any employees from unionizing.

Because it is illegal for management to "talk down" unionization until just prior to an election, with EFCA, the employees only hear the Union's viewpoint, truthful or not, at the time they are confronted by a Union representative. If they agree with that Union rep, they will check off their intention on a card and sign it. And, as soon as 51 percent of that company's employees sign cards saying that they want to unionize, the company is immediately unionized. Management's voice is completely shut out of the process. There is no further discussion; and, there will be no further management input into the process. Most importantly, there will be no secret ballot election.

To me, the exclusion of management's voice is the real reason behind the "Employee Free Choice Act." That's because, for years, the Unions have consistently failed at the ballot box. Over the last 3 or 4 decades, the union arguments to unionize have been less effective than management's arguments against unionization. For that reason, in vote after vote, management has been successful in defeating the unions.

So, rather than come up with a better argument for unionization, the unions, with the help of their paid-for and elected officials, the Democrats, have decided to silence management through the passage of the "Employee Free Choice Act." That's the true reason behind the EFCA/Card Check; and, that is why the unions believe that EFCA will allow them to grow and grow without being impeded by management.

In arguing against EFCA, I would ask the unions this simple question: What is "so" wrong with the current system? But, it seems like that question isn't being asked. If it was, we might get to the heart of why the current collective bargaining laws needed to be changed; and, the real reason for that change would be exposed to the light of day.

Silencing the opposition is a long held tactic by those who are against democracy. The end game of EFCA is no different than Hugo Chavez's shutting down of opposition radio and television stations and newspapers in Venezuela in order to win elections. It is no different than the Democrats trying to silence conservative talk radio through the so-called "Fairness Doctrine." "Free Choice" and "Fairness" are just attempts by the Democrats to create labels which, in actuality, are the antithesis of what they are really trying to do.

As usual, this is just my "Cutting Through The Fog" opinion. But, I think I'm very right, and not just being on the right, on this one!

Image by ol slambert's photostream on Flickr with Creative Commons Licensing remix/adapt/modify permission (Click to View Other Works). Specifically modified by Cranky George for this blog entry