Wall Street demands new money fix (Updated)

Update: It appears the Fed isn’t listening (Washington Post), good for them.

They’re at it again.

The Wall Streeters who made their money while hooked on “quantitative easing” (or QE, for short) – the fancy term for when the Federal Reserve sucks up a whole range of securities and turns them into dollars – are insisting the world will come to an end if they don’t get their next fix (New York Post).

…it could cost Americans another $1 trillion.

As Federal Reserve chief Janet Yellen winds down the huge Quantitative Easing 3 program, an addicted Wall Street is looking for the same fix in liquidity — a lethal cocktail to prop up feeble markets.

Despite the Fed reducing its purchases by $10 billion monthly since July, it now holds more than five times the sum of securities it had before the financial crisis.

The balance sheet, which exceeds $4.4 trillion, is approaching the size of Japan’s gross domestic product.

Of course, Wall Street would love to see QE4: it props up bond prices (when bond rates are low, their prices are high), while shoving folks who aren’t lucky enough to be sitting on that paper into stocks in a desperate search for a return on their investment. Stock and bond prices rise all around, creating an asset bubble.

Never mind that this does nothing for actual economic growth. Never mind that it exacerbates wealth and income inequalities (which are a real problem when they are caused by rent-seeking behavior like this).

In effect, we are still seeing the after effects of the Panic of 2008. The economic correction that should have happened was avoided when Washington enacted TARP (and thus convinced Americans that all the banks were sick, rather than just some of them). The flip-side was the fear of a “credit crunch” that was actually caused by shocking the corruption out of the LIBOR rate – while rates that were based on actual transactions (rather than a manipulated survey) barely moved.

To be fair, the Fed actually sounded the alarm on LIBOR, only to be ignored by their British counterparts. Still, the fact is, this in an economic funk that was caused not by the private sector, but two governments (in Washington and London)…and one of them is still perpetuating the myth that got us here in the first place.

Cross-posted to the right-wing liberal

Meanwhile, in Brazil…

This summer, most eyes were on Brazil for the World Cup. Far fewer noticed the uproar in the country over how badly the Brazilian government went through $11 billion to prepare for it. Once Brazil was embarrassingly bounced from the tournament by Germany, I felt that uproar would be a lot more important.

Well, yesterday, the Brazilian people had their say, and a leading opposition figure (Aecio Neves) scored a “surprise” surge to force a runoff in three weeks (CNN, BBC). Incumbent president Dilma Rousseff is considered the favorite, but Neves has already outperformed polling just to get to the runoff.

I humbly submit that the World Cup will prove to be Roussef’s undoing.

Cross-posted to the right-wing liberal

Bob McDonnell was a WHAT?!?!

Reactions to the Bob McDonnell verdict our pouring in, and there’s one in particular (from many of his defenders) that I find completely flabbergasting.

The ex-Governor’s defenders are calling him a “man of integrity.” My jaw hits the table each time I see that.

Folks, Bob McDonnell spent all of 2009 insisting he would not raise taxes. He blasted his opponent (Creigh Deeds) for even considering it, and rode the issue to a landslide win in November of that year.

In the last year of his term (as it happens, last year) he broke that promise in spectacular fashion, ramming through the largest tax increase in at least 40 years.

Even then, he skirted the truth. He insisted the tax hike was for relieving commuter congestion, but in fact his top priority was actually a parallel road to US 460 that wasn’t needed for traffic relief – and which the Army Corps of Engineers said he couldn’t build anyway (Bacon’s Rebellion).

So please, spare me the “man of integrity” nonsense. If you want to complain about the federal decision to prosecute McDonnell (as opposed to other Virginians) or the bizarre nature of the “honest service fraud” statute, that’s one thing.

But Bob McDonnell was no angel.

Cross-posted from the right-wing liberal

Another TARP opponent survives

The victory of Pat Roberts (Republican U.S. Senator from Kansas) in his primary battle is reaffirming the conventional wisdom that “Establishment” Republicans are thwarting “Tea Party” challengers. As one may expect, I don’t automatically share that view. In fact, I think the Tea Party vs. Establishment meme misses the point.

Most would be surprised to see Roberts hit from the right, and one big reason is his vote against TARP (a.k.a. the bank bailout). This is the first chance for Kansas Republicans to weigh in post-TARP on whether Roberts should be the nominee. I find it telling that Roberts survived while TARP proponents like Eric Cantor did not.

Odds are the bailout vote was even more critical in Mississippi, where Thad Cochran (a No on TARP, despite my mistaken assumption) was able to limp into a runoff (and then a narrow if unorthodox victory) when a TARP backer likely would have gone down in flames.

Lest we forget, a large plurality of voters still blame Bush the Younger for the state of the economy…meaning TARP, contrary to popular belief in Washington, has not been forgotten.

Even Mr. Establishment Heavy himself – ex-Congressman and Defending Main Street PAC leader Steve LaTourette – was a No on TARP. That should tell us all something.

Cross-posted to the right-wing liberal

Elizabeth Warren backs the Bank of Boeing

To her supporters, Senator Elizabeth Warren is a champion of the downtrodden and bane of the wealthy.

To those of us who know better, she’s a government-always-first leftist who is quite fine with helping the biggest and wealthiest corporations in America so long as the government grows.

We have the Heritage Foundation to thank for this. As Timothy Carney (Washington Examiner) pointed out, Heritage reached out to Warren to see if she would help them fight the Export-Import Bank. No dice: “Senator Warren believes that the Export-Import Bank helps create American jobs and spur economic growth.”

Never mind that so many of the products financed by the bank are intermediate products for foreign firms competing against Americans. Never mind that export subsidies are far and away the worst type of trade intervention for an economy. Never mind that the Congressional Budget Office and the General Accounting Office have laid waste to the arguments the Bank itself peddles (The Corner). Never mind the numerous examples of fraud (Daily Signal). Never mind that it is such a profit-padder for Boeing that it’s nickname is “the Bank of Boeing.”

Clearly, for Elizabeth Warren, some corporate welfare is better than others.

Cross-posted to the right-wing liberal

Ed Gillespie says GOP “learned a lesson,” then proves it by opposing Ex-Im Bank

Roughly a month after he earned the Republican nomination for U.S. Senate, Ed Gillespie – consummate Establishment man – spoke to Rick Sincere (a.k.a., the Charlottesville Libertarian Examiner) about his campaign going forward. He addressed head on complaints about his former employer, President George W. Bush (emphasis added).

“The difference between Republicans and Democrats,” he told the Charlottesville Libertarian Examiner at Claudius Crozet Park, “is, I think, Republicans have learned a lesson.”

Continuing, he noted that “the fact is, I agree that when Republicans had the House, the Senate, and the White House that we spent too much money.”

That experience from the first decade of the 21st century, he added, “pales in comparison to what the Democrats did when they got control of all three – the House, the Senate, and the White House – but that’s not enough.”

What was far more important, however, was Ed’s first example of a government program that needs to go:

One (program) that I have said already that I believe should not be reauthorized and doesn’t deserve to be continued in funding is the ExIm Bank.

If Gillespie has talked about winding down Ex-Im, I missed it, but that’s my problem, not Ed’s.

The point is this: Ed Gillespie’s willingness to put the “Bank of Boeing” on the chopping block is a sign he really has “learned a lesson” about the Republican Party’s mistakes. For a fellow of his Establishment pedigree to openly oppose the Bank is an excellent sign.

I had my concerns (driven by TARP) about Gillespie before the nomination, but he is the party standard bearer now, and more importantly, his opposition to Ex-Im reveals that he does indeed know the party needs to go in an anti-corporatist direction.

Good for him, good for the Republican Party, and very good for Virginia.

Cross-posted to the right-wing liberal

New House Majority Leader: Kill Ex-Im Bank

The primary defeat of Eric Cantor continues to reverberate in unexpected ways, as his incoming successor as Majority Leader tells Fox News that he supports shutting down the Export-Import Bank (Washington Examiner):

On “Fox News Sunday,” host Chris Wallace asked McCarthy if he agrees with “conservatives who say that the Export-Import Bank is a form of crony capitalism and it should be put out of business — allowed to expire.”

McCarthy responded by tying Ex-Im to “one of the biggest problems with government,” using taxpayers’ “hard-earned money,” to do things the private sector can do. McCarthy supported Ex-Im’s reauthorization in 2012, but he argued on Fox News Sunday that this was a vote to “wind down the Ex-Im Bank.”

Wallace put the question more directly: “You would allow the Ex-Im Bank to expire in September?”

McCarthy immediately said “Yes. Because it’s something that the private sector can be able to do.”

That’s a dramatic change in view from Cantor, and a refreshing one. If McCarthy is serious about it (and that bizarre explanation for his 2012 vote should give us some pause), it would strike a strong blow against corporatism.

Ex-Im’s defenders have three months to save their special interest, and they will throw everything including the kitchen sink to do so. McCarthy’s stance is to be praised, and we should help him hold his newfound ground.

Cross-posted to the right-wing liberal

Nancy Pelosi: locked out of her own argument

The Congressional Budget Office’s report on what Obamacare – given the president’s numerous rewrites and delays to the policy, I can now comfortably retire the term “Robertscare” – will do to the labor force (the equivalent of 2 million Americans leaving the workforce), Nancy Pelosi actually celebrated the news (Hot Air):

“What we see is that people are leaving their jobs because they are no longer job-locked,” House Minority Leader Nancy Pelosi (D-Calif.) told reporters after House votes Tuesday afternoon. “They are following their aspirations to be a writer; to be self-employed; to start a business.”

While many of her critics lamented (and loudly) Pelosi and her allies for their devaluing of work, far fewer noticed that her own argument is completely wrong (to be fair, Hot Air’s Mr. Glass did).

As it happens, I have some friends who are writers, and they tell me that it involves quite a bit of hard work (no real surprise there). They also greatly enjoy it. More to the point, however, they don’t have rags-to-riches stories of their success. They started small, with short stories, and then moved up to novels. Writing, like any other career, has its well-worn paths.

What they didn’t have was a health-insurance subsidy that would disappear between, say, story five and story six, or between the sale of copy number 1000 and copy number 1001. That’s what Pelosi et al seem to miss: the subsidy-loss effect impacts all industries: manufacturing, services, and the arts she seems to prize.

The subsidy – and its clawback at certain income levels – doesn’t give workers the freedom to change jobs that would otherwise be blocked: it prevents people from advancing any career.

Of course, you’d have to understand microeconomics to get that, and economics of any kind just isn’t the Democrats’ strong suit.

Cross-posted to the right-wing liberal

The economy, blame, TARP, and what it means for the GOP

CNN conducted a poll on the state of the economy, and as one would expect, the people are not happy (emphasis added):

Thirty-six percent of those questioned rate the current economic conditions as good. That’s up four percentage points from December and it is the highest level since January 2008, a year before Obama entered the White House. Sixty-four percent continue to say the economy is in poor shape.

But that’s not the key takeaway. This is (emphasis added):

Five years into Obama’s presidency, only a third of the public believes that Obama and the Democrats are primarily responsible for the country’s current economic problems.

More Americans continue to blame former President Bush and the Republicans.  But the number who say the GOP is more responsible – now at 44% – has dipped below the 50% mark for the first time since Bush left the White House.  Fourteen percent blame both parties equally.

I would humbly submit that the above poll (which, as implied in the excerpt, had blame for Bush over 50% in 2012) is the most important poll of the last several years – more important than the demographic polls, or the issue polls, or the “branding” polls, or anything else. I say that because it makes clear that the economy is still a winning issue for the Democrats – and has been since 2008. It also reveals the way forward for the GOP – which the other polls don’t.

First, let’s address the key takeaway: how can it still be Bush’s fault five years after he left office?

The answer is the Democrats’ message on the economy, and the GOP’s complete inability to counter it – something we are in danger of seeing all over again in Virginia if Ed Gillespie is the Republican nominee for U.S. Senate.

Ever since the president put his hand on the Bible the first time (in 2009), the Democrats have had the same message regarding the economy: “the crisis did it.” Any comments from the Democrats on the subject go back to the fall of 2008. That has been their get-out-of-jail-free card for five years…and it has worked because Republicans have been foolish enough to present supporters of the 2008 bank bailout as their leaders (Boehner, Cantor, McConnell, Romney, and Ryan). If your leaders all think things were so bad that the major banks needed $700 billion, it’s impossible to argue that the Great Recession and weak recovery that followed were due to Obama policies – no matter how true it might be.

This is why I can not support TARP supporters for Republican nominations. We should have learned this lesson when Romney lost (I know I did). Unless we nominated candidates who did not support TARP (and thus can argue that it did more to exacerbate the problems of 2008 than to solve them), we are simply swallowing the Democrats’ economic narrative whole. That means the economy is no longer a winning issue for us, period (it also means we can’t change the subject when “War on Women” nonsense comes up, because switching the economy does us no favors).

Until the Republican Party repudiates the bank bailout, it will always be blamed for the state of the economy so long as it remains this weak. We have to counter the Democrats’ narrative on 2008, and we can’t do this if we nominate candidates who agree that things were so bad that the bailout was necessary.

Unfortunately, for all my friends who support Ed Gillespie, that means he cannot be nominated, for he will not win.

Cross-posted to the right-wing liberal

The Republican Party, TARP, and Ed Gillespie (plus some personal news)

For those wondering where I’ve been for the past three weeks, I was recently married (Sunday, the 12th, to be exact). For those interested, meet the new Mrs. Liberal.

Anyhow, while I’ve been on my honeymoon, Ed Gillespie made it official – he is running for the U.S. Senate. Whether he wins the nomination or not is an open question (I’ll admit it may not be wide open at this point); for what it’s worth, I do think he would be a better Senator than Mark Warner. However, as I have discussed before wedding planning dominated my time, Ed has one fatal flaw to the party: his support for TARP (a.k.a., the Bank Bailout).

I should note that I have considered TARP a policy mistake practically since its conception, and I have maintained that view over the years. I have also explained why Republican nominees who support TARP are badly handicapped against their opponents: because they essentially agree with the Democrats’ excuse for the poor economic performance of the Obama Administration (i.e., the “2008 crisis” did it).

There are, however, even greater problems for TARP-backing Republicans when they get into office. Whatever arguments may roil the GOP, there is near universal recognition that spending needs to be reduced in general, and entitlement spending in particular. However, any pro-TARP Republican who talks about entitlement reductions and/or reductions in anti-poverty programs (no matter how inefficient or counter-productive said programs might be), will get slammed as a friend of the rich and a hypocrite for supporting the $700 billion bailout. While many, many Democrats also supported the bailout, they aren’t talking about these cuts. We Republicans are, and thus we suffer the consequences of cynical voters and lack of trust when we say America can’t afford spending X on entitlements or Y on discretionary spending when our spokesmen voted for $700 billion for the nation’s biggest banks.

I will admit that TARP, as a stand-alone issue, doesn’t resonate with voters as it did in 2008. However, its effects still scar the political landscape. Its damage still affects Republican politicians who supported it (such as Romney and Ryan in 2012)…

…which brings us to Gillespie. Whatever else one may say of him, as White House Counsel during 2008, he was at the forefront of defending TARP (see here). He is the epitome of the TARP-stained Republican pol. He will find his ability to maneuver on political issues far more restrained than he or his supporters believe.

In short, I do not think he will defeat Warner. More to the point, whether he does or not, his nomination and (if it happens) election will keep the party stuck in its TARP-supporting past, when it must instead highlight the TARP opponents in the party in order to re-establish trust on spending with the voters.

I have many friends who are fond of Gillespie (and some who aren’t); I don’t know the man personally. I do, however, know his stance on TARP, and that is enough for me to say that if he were nominated, the party – and the country – will lose more than it gains.

Cross-posted to the right-wing liberal

Ed Gillespie – would-be Senate candidate – backed TARP (meaning I can’t support him)

This has been cross-posted from my personal blog, the right-wing liberal. I speak only for myself.

There have been whispers (and much louder) about Ed Gillespie running for United States Senate next year. Given his national connections and the potential vulnerability of Senator Mark Warner, one can understand why there is excitement around Gillespie’s potential candidacy.

That said, Gillespie has one very critical flaw: as White House Counsel in 2008, he was a loud defender of TARP (CNN):

(CNN’s John) KING: You mentioned the economy. One of the last acts was this bailout. And $350 billion of it has been spent on George W. Bush’s watch. The second installment will come on Barack Obama’s. But many Americans, when you travel, they think, where did this money go? Did big banks get it on Wall Street? It is being flushed literally down the toilet? They don’t see the impact on Main Street.

But can you cite specific evidence that the first $350 billion has done anything to begin the turnaround?

GILLESPIE: You can, John. And in fact, if you look at the rates that have narrowed in terms of credit markets, the TED spreads and LIBOR, things, frankly, I didn’t know that much about until about six months ago, they were very — the spreads were high. And that’s not good for the credit markets.

The injection that the Treasury has put into the capital markets has helped ease those. Again, this is a difficult time. But the president said the other night, I believe rightly, that had we not acted boldly and had we not put this money into the financial markets, we would have seen a lot worse of a financial strain on the American people today than what we’re already witnessing.

Now, readers of my blog will know that I’ve been critical of TARP practically since its conception, and I have maintained that it was a terrible mistake. However, there is more to it than that. When Republicans nominate TARP supporters, they are essentially agreeing with the Democrats’ claim that the situation in 2008 was so terrible that President Obama should essentially be given a pass for any economic problems under his watch. It was one of the reasons Mitt Romney’s criticism of the president on the economy was so ineffective. It also damaged his efforts to criticize enlarging government in general.

As for Gillespie’s specific comments, we now know LIBOR was a badly corrupted indicator, one that even at the time should have been eclipsed by SONIA and EONIA (which were based on actual transactions, had already discounted the pre-September concerns about the economy, and thus did not jump in panic when Lehman Brothers sank beneath the waves).

Thus, for policy and political reasons, I cannot support Gillespie for the nomination. Support for TARP is a stain that cannot be removed.

Obamacare — What Could Go Wrong?

Dr. Barbara Bellar – Obamacare Summed Up in One Sentence:

“We’re going to be ‘gifted’ with a healthcare plan we are forced to purchase, and fined if we don’t, which purportedly covers at least 10 million more people, without adding a single new doctor, but provides for 16,000 new IRS agents, written by a committee whose chairman says he doesn’t understand it, passed by a congress that didn’t read it but exempted themselves from it, and signed by a president who smokes, with funding administered by a treasury chief who didn’t pay his taxes, for which we will be taxed for four years before any benefits take effect, by a government which has already bankrupted social security and Medicare, all to be overseen by a surgeon general who is obese and financed by a country that’s broke. So, what the blank could possibly go wrong?”

A fatal conceit of all progressives is that they think that they can fix anything and are somehow immune to Murphy’s Law:

Everything that can go wrong, will go wrong at the worst possible time.

What makes the Obama so special is that it appears that he did not put much effort into getting his singular legislative triumph to shine coming out of the box.  The $600,000,000.00 project was not competitively bid, and the likes of Amazon, Google, Ebay etc. were not brought in to do the job.  The chief qualification of the company chosen to do the job was that Michelle’s college roommate works there.  Crony capitalism, incompetence, corruption, and cost overruns all in one package.  A textbook case for ‘how not to run a project.’  What is excruciatingly obvious is that the community organizer and his bride have never built anything before.

What staggers the imagination is that Obama refused to acknowledge the reality that this roll out was going to be a shambles.  A public spectacle.  An embarrassment to the nation.  He knew the exchanges where not working.  Yet, the political considerations where paramount.  The optics of a delay in the rollout were bad. Little did Obama realize how bad the optics would be if he did roll out non-functioning exchanges before a public with no recourse.  No doubt, given past performance, this narcissistic tower of hubris decided that another speech would fix the public’s perception.  No need to sit down with the Republicans to write some stopgap legislation putting off the individual mandate for another year … let them eat cake!  At least Mussolini did get his trains to run on time.

Medicare when it came out did not strip ordinary Americans of their access to healthcare insurance.  The problems were nowhere near this daunting because when you get down to it, medicare was a Blue-Cross Blue-Shield policy from 1967 written into law.  The law was passive in that as things where assembled people got on to the program.

Obamacare is an entirely different kettle of fish.  It demands that the entire healthcare insurance market conform to a uniform standard, of Obama’s choosing. The old plans that do not meet the new standard, even if people liked them, are to be done away with. The result is over 5,000,000 canceled policies.  How many people were covered under those policies?  What are they to do in the meantime?  Sign up?  How?  The proposed Obama fix is vintage despot: govern by fiat – had Bush proposed such an abuse of executive authority the New York times would have declared him a reckless cowboy; the staff suffering a collective aneurism in the process.  Obama once again revealed himself as capricious, unmindful of the law he wrote and the constitution he swore to uphold.  Demonstrating another fatal progressive conceit — the law does apply to them.

We can see the fallout from this one size fits all for 315,000,000 people.  Yet another fatal conceit of progressives is that they know what you need better than you do.  Some people like their catastrophic healthcare insurance because they do not want $10 co-pays.  Some like catastrophic healthcare insurance because they cannot really afford more. Not everyone wants a Big-Mac, some people prefer Falafel.  Not everyone can afford a Cadillac — but they can live with a Chevy.

For every person who signs up, 40 loose their insurance. Those who do sign up see a 40% increase in their premiums and a tripling of their deductibles.  People are paying more to get less.  Obama claimed the ACA would lower premium costs on average by $2500 per year, per policy.  I do not think “lowering average costs” means to Obama the same thing it means to the rest of us.  In short whether this claim was another deliberate falsehood or the misconception of someone in over their head is immaterial.  We where sold a bill of goods.  The American people where deceived, swindled, & conned by the Democrats and their front man, our president.

What could go wrong?  So far, everything.

Obama Lied, Healthcare Died

Watching Obama attempt to gain control and manage one sixth of the U.S. economy by executive fiat is painful; the President is not even following the guidelines of his namesake law.  I cannot help but experience sadness for I take no pleasure watching the suffering of the 5 million people who have lost their insurance. I take no pleasure in our country looking like a laughing stock because of the abysmal state of the healthcare exchanges.  We look like a third world country – the incompetence is on display every day.

I see this law doing exactly what was predicted by its opponents. It is wrecking havoc on our economy. How many small businesses have laid off their full time workers in anticipation of this law?  I see our nation made smaller by this law.  I see this nation harmed by this law.  It is tragic.  I see the overweening hubris of this president on display; the health care ship is sinking and Obama thinks he can raise it up from the waves with an executive order and a speech, for working with congress is beneath him.

Can’t Obama swallow his pride and finally sit down across the table from speaker Boehner and work out a deal that will satisfy both parties?  That is the true nature of a bipartisan deal, both sides give a little and both sides win.  A win-win outcome is unthinkable to the community organizer.

What is not beneath Obama is lying to the American people.  He will not compromise with congress, or negotiate with the representatives of the people, but he is willing to fabricate from whole cloth untruth to sell a half baked plan for remaking healthcare in America:

Obama, Aug. 15, 2009: I just want to be completely clear about this; I keep on saying this but somehow folks aren’t listening, if you like your health care plan, you keep your health care plan. Nobody is going to force you to leave your health care plan.

Obama, June 28, 2012: First, if you’re one of the more than 250 million Americans who already have health insurance, you will keep your health insurance — this law will only make it more secure and more affordable.

This statement, or its equivalent, was repeated some thirty times to the American people.  The President knew that this was a blatant untruth from the beginning.  He repeated it.  Like Obamacare, the President owns this.

As if that was not enough, all who opposed this were cast in the worst light.  There was never any compromise in the writing of this bill.  No disagreement was tolerated.  For Obama there was no legitimate reason why 2700 pages of legislation should be subject to scrutiny or amendment.  It was war by other means:

Obama, March 25, 2010: From this day forward, all of the cynics, all the naysayers, they’re going to have to confront the reality of what this reform is and what it isn’t.

In the end without a single Republican amendment, or vote, the Democrats pushed this mess through the process.  It became law even though many of the rules of the senate were broken along the way.  The Democrats own this law.  It is theirs and theirs alone.  It is causing a lot of pain.  They own that pain.

The result of this legislation:

  • Doctors are retiring in record numbers.
  • Hospitals are closing in record numbers.
  • Employers are laying people off in record numbers and hiring part time help to replace them.
  • The labor participation rate is the lowest it has been since 1978 – back when most women still stayed home from work.  We have over 90,000,000 adults not working.
  • Medical schools have seen a sharp decline in enrollment.
  • Medical research and development is dropping off.

This is being saved?  This is reform?

We are heading toward a system of rationing and stagnant innovation.  We will see a drop in Physician quality as medical schools will allow those less qualified to enroll as the best and brightest are now going elsewhere.  We will have longer waits before patients are seen for serious issues.  Our cancer survival rate is currently far better than Europe’s.  This advantage will disappear.  The worst of it is that it still won’t be fair because Congress and Obama’s political allies will be exempt from Obamacare.  What is tragic is that vast majority of the the uninsured … will remain uninsured.

Obama lied about what this law would do.  It raises premiums and lowers service.  It does not save the American public money, it raises the cost of healthcare by over 40%.  It bankrupts many in the middle class in the name of fairness — how this is fair escapes me.  It is a tax on the middle class to support the poor.  It is a tax on the healthy to help the sick.  It is a tax on medical innovation and excellence.  It is a tax on life, as the old and sick will be given pain medication to ease their passing instead of treatment to improve their condition.  Obama lied. Our nation’s healthcare died.

Oh…THAT’S what the president meant

What the president said: If you like your health-care plan, you’ll be able to keep your health-care plan, period.

What the president actually meant: If we like your health-care plan, you’ll be able to keep your health-care plan, period.

Once again, the arrogance of the Democrats is laid bare. They know better than you what your health insurance should be. They know better than you how to take care of yourself.

Cross-posted to the right-wing liberal

Shutdown “Gestapo Tactics” Help Make the Argument Against Obamacare

Sen. Mike Lee ABSOLUTELY NAILS IT. The Obama administration’s petty tyrannies during the first week of the government shutdown neatly illustrate the problem with giving politicians too much power–they’ll use it.

There is really no excuse for the president’s petty, spiteful actions this past week. At every turn, the president has gone out of his way to make the government shutdown as painful and disruptive as possible. The administration has left Michelle Obama’s “Let’s Move” website active while affirmatively making many others inaccessible. [Note that these other sites are still up, they’ve just redirected to shutdown pages. That means that there is no reduction in expense, as the site is still being paid for, only that it has been purposefully made unusable.]

The president has allowed the otherwise-closed National Mall to be used by his close union allies in SEIU for a political rally in favor of illegal immigration, while stiff-arming everyone else, including WWII veterans and other Honor Flight participants. And lest you think you might not be getting the straight story on that, Nancy Pelosi herself went out of her way to thank the president for making the Mall available for the lefty rally.

The president has also blatantly caused private residences and private businesses to be needlessly shut down, as my colleague Jeanine Martin has noted. Furloughed federal workers have been ordered not to work, even voluntarily, resulting in innumerable manufactured hardships, such as a forced shutdown of religious services on military bases.

Folks, the words arbitrary and capricious mean nothing if they don’t describe what the president and his people have been doing with federal power over the last week. But I can’t explain that nearly as well as Senator Mike Lee (R-UT) did:

“The Obama Administration’s behavior during the first week of the shutdown has been the best argument against Obamacare anyone has ever made,” said Senator Lee.

“The American people do not want Obamacare, and they are demanding that Washington act to protect them from the harmful effects of this unfortunate law. The president’s response has been to ignore them, allow the government to shutdown, and then use his power to close national parks and monuments, stop paying veterans’ benefits, and cut off cancer research.

“This is exactly why we should not expand the government’s power over our health care choices. What power the government has, it will use – and misuse – to advance its own interests, even if that means punishing the American people along the way.

“The message behind the Administration’s shutdown bullying is the same message sent by his IRS’s abuses of political opponents: do what I say, or else. This is the abusive, partisan, unaccountable bureaucracy that, under Obamacare, will soon be running America’s health care system.

“President Obama is not just using the vast powers of his office as leverage against Republicans – he is abusing his powers as leverage against the American people.

“The scenes of World War II veterans being shut out of a monument built in their honor should be a bright red flag warning the American people what an out-of-control federal government is capable of. Each day brings a new and more vivid example of why it is critical that we not allow Washington to reach even further into our most personal and intimate decisions.

“We now see how determined the president is to expand the power of the federal government and his willingness to use that power to harm the country to get what he wants. Congress cannot allow this to stand and should continue to work to end the shutdown and protect the American people from Obamacare.”

Exactly so.

Cross-posted to TheBullElephant.com

House. Republicans. Don’t. Get. It.

The moment I saw the headline of this Corner post (House GOP Strikes Food Stamps Pact), my heart sank. After reading said post, it’s still “underwater.”

Now, to be fair, the “pact” – which is in fact a policy idea that hasn’t yet been run through the entire caucus – isn’t bad. Essentially, it restores the 1990s welfare-reform requirements on food stamps for able-bodied adults without children (work 20 hours a week, or be limited to three months of aid every three years). The numbers folks say it could save about $20 billion (although I think that’s over multiple years).

However, and I can’t say this enough, any attempt to deal with the recent explosion in food stamps without addressing the market-distorting farm policies is merely treating the symptoms while the disease runs unchecked. So long as the government continues with policies that drive up the price of sugar, milk, corn, and everything fed on corn (i.e., meat), more people will need government assistance than would be the case in a true free market for food.

Whatever one thinks of the particular policy change (and, again, I think it has some merit), any farm/food-stamp bill that doesn’t get rid of Pitchfork Corporatism still says the same thing to suburban and urban consumers: Drop Dead.

Cross-posted to the right-wing liberal

Single-payer, the left’s health care nirvana – doesn’t exist

As the nation careens toward the true launching of Robertscare (a.k.a. Obamacare) – and even here, there is a disconnect between the insurance exchanges to launch on October 1 and the subsidies for them, which don’t start until January 1 – there is talk that the entire edifice will crash in a mess of incompetence, fraud, and confusion. This has led many to wonder if and when the left will claim that the only real way to fix health care is to go to a “single-payer”, government monopoly system, one that they claim exists in the United Kingdom and Canada – and that most in the center-right decry as “socialized medicine”.

I should note the theoretical advantages of single-payer: the federal government could, in theory, have monopsonistic power that would enable it to drive down health care prices and costs; health insurance would cease to be a cost for many businesses; and citizens would no longer have the uncertainly of health care cost to impact their future spending and investment decisions. These are not only the defenses that are used by the single-payer backers; they are also cited as the reasons the UK and Canada have “single payer.” Less knowledgeable folks on the left will even assume the rest of continental Europe has single payer – and cite the above as reasons for it.

Of course, each of the reasons has their drawbacks – drawbacks which completely undermine the theoretical advantage. In practical terms, Medicare already gives the feds monopsony power – and they handed that market power to the AMA, thus making that group a monopolist (and revealing the failure of the monopsonist argument in the first place). Firms liberated from the cost of health insurance will end up stuck with the tax bill for the government-run system; a trade that will hardly improve business climate. Finally, as Medicaid recipients are already discovering, insurance from health care cost is not the same thing as access to care.

With the theoretical arguments thus debunked, one might ask why any nation would have “single payer.” The answer is simple: in the democratic world, no one actually has single payer.

In continental Europe, for example, all nations use some sort of public-private mixture for health care, just as we do. Most believe Europe’s health systems are more government-controlled (I’m not so sure, given what I now know about Medicare’s power), but none of them claim to have the government-monopoly system credited to London or Ottawa.

This leaves those two capitals, which supposedly fund and directly control health care in their respective countries. The trouble with that assumption is that it is not true. Contrary to political myth, Canada’s provinces decide health care allocation. Ottawa subsidizes the provinces, but does not make spending decisions for them. Thus, health care in Canada can vary from province to province. I would argue that the most dramatic example is Ontario, which charges its residents a health insurance premium, meaning that in Canada’s largest province, “single payer” health care isn’t even “free.”

Unknown to nearly all Americans, the British health care system is also provincially directed as a result of the 1990s devolution. There is not one “payer” in the UK, but rather four. The only province with health care under federal control is in England – and that’s only because England has no provincial assembly of its own.

So what does this mean for the United States? One of two things: If the (Un-)Affordable Care(-less) Act fails, and the left gets what it wants, the American health care system will be more radical and government-directed than that of any democracy on Earth. If instead, the (U)ACA “succeeds” – or, as more likely, wheezes through – our system will become somewhat more government-directed than it is now.

Either way, so long as the corporatist relationship between the federal government and the AMA remains intact, things in health care will get worse, and worse, long before they get better.

Cross-posted to the right-wing liberal

Republicans to urban and suburban consumers: Drop Dead

I’ve been a bit busy on Facebook regarding the 2013 Farm Bill, but I was lax about posting on it. Time to fix that – and thanks to Veronique De Rugy for bringing this up again in The Corner:

A few weeks ago, I suggested that splitting the farm bill into two pieces would have the benefits of breaking the alliance between the pro-farm and food-stamp spending lobbies in the hopes that it would help get rid of farm subsidies.

I thought that splitting the bill into two parts would finally put farm subsidies on the path to elimination where they belong. Boy, was I wrong. As it turns out, Republicans are as eager as ever to continue to support a “ag-only bill” that includes indefensible subsidies to farmers, such as sugar-producer programs, and creates new income-entitlement programs, such as the shallow-loss program.

You and me both, Veronique.

As one can see here in the vote on the matter, House Republicans rammed this nonsense through all by themselves. Not a single Democrat supported it. To be fair, had the food stamps been included in the bill at funding levels the Democrats preferred, they would have voted aye, but that doesn’t excuse the Republicans…at all.

Rugy, citing Taxpayers for Common Sense, explains why:

It gets worse, as Taxpayers For Commonsense explains:

“Leadership argued this was the same portions of the amended bill that failed last month. Except it wasn’t. Yes, they repealed archaic and wasteful permanent law that dated back to 1949. Good. But under the cover of darkness, they had conveniently deleted nearly all the lines that would ‘sunset’ these new changes in 2018. So they not only created new income guarantee entitlements, revived Moscow-on-the-Potomac government-set target prices, loaded up with new special interest carve-outs, and expanded already overly generous crop insurance subsidies, they made these market distorting subsidies the new ‘permanent law.’ Really, really bad. House Agriculture Committee Chairman Frank Lucas (R-OK) wanted to lock in record farm income and these extravagant subsidies in perpetuity without any trigger to regularly review them. It’s waste on auto-pilot.”

Ouch.

I would argue that with the “Moscow-on-the-Potomac government-set target prices,” things are even worse than they seem. Stuff like this – which usually includes paying folks not to farm, the aforementioned price floors, and the sickening ethanol subsidies – actually make food prices higher for hundreds of millions of Americans. We still don’t know how much our food-stamp program addresses genuine need, as opposed to artificial hardship created by government-driven food inflation. If the House Republicans have their way, we’ll never know.

What we can be sure of is this (from Rugy again, emphasis added)…

To add insult to injury, this move just feeds into the portrait Democrats like to paint of Republican lawmakers: They will support any policies that favor the rich – even if they mean more government spending – and like to oppose policies that would benefit  lower-income Americans. In this case, there is some truth to that. Republicans are showing that, while some of them weren’t willing to vote for the farm bill as long as it included food stamps, they will support the outrageous redistribution of income to higher-income Americans when it benefits wealthy farmers.

What kind of message does this send to voters in suburban and urban areas?

Answer: Complete, unadulterated, and utter contempt.

This is Pitchfork Corporatism at its unrepentant worst – and it’s a sign that the Republicans in Congress simply don’t get it. They have essentially told non-farm voters, “Drop Dead.”

IRS can’t do their contracts right either

The IRS’ nefarious actions toward center-right organizations has had one unexpected consequence: it has kept attention away from the Agency’s appalling record in contract compliance.

Government contracts are regulated by the Federal Acquisition Regulation (FAR), which gets revised often. As it happens, according to Jeryl Bier (Weekly Standard), “Congress had passed legislation in 2008 to address high-risk contract awards” – a reference to cost-reimbursable awards, in which the government is basically on the hook for whatever the contractor says is cost incurred.

By 2011, the Congressional changes were worked into the FAR. Yet according to the IRS Inspector General (same link):

The IRS did not issue internal procurement policy guidance to implement the FAR revisions that were required by the Act.  Although the revised FAR became effective on March 17, 2011, the IRS has not issued any procurement policies and procedures to implement recent FAR changes for cost-reimbursement contracts.  Instead, the IRS has used the prior FAR and its existing internal procurement policies and procedures[.] [B]ecause no guidance had been provided, the COs (RWL note: COs is short for “contracting officers”) who we interviewed were not aware of revisions to the FAR required by the Act as they related to documentation requirements in the contract file.  One CO stated there was no communication from the Office of Procurement regarding any FAR revisions on the subject of cost-reimbursement contract documentation requirements.

Uh oh.

Sure enough, the IG looked at 49 cost-reimbursable contracts and found…

The IRS did not comply with the majority of the new FAR requirements for 46 of the 49 cost-reimbursement contracts entered into between March 17, 2011, and June 30, 2012, totaling nearly $47 million.

But the Tea Party groups are the problem. Right…..

Cross-posted to the right-wing liberal

Sanford wins special election to Congress

I am surprised at how the blogosphere seems to have missed the pertinent lesson of Mark Sanford’s return to Congress last night.

Yes, it’s a highly Republican district (SC-1). Yes, Sanford has had some personal issues. Yes, he ran about 8 points behind Tim Scott (although, this being a special election, weird things can happen).

What seems to have slipped past…well, everyone…is that Sanford also had a political record, one of the strongest in the country on spending and taxation. With his election, he is now the first member of Congress to to sign the Reject the Debt pledge from the Coalition to Reduce Spending, a great leap forward for accountability on the spending side of the budget.

Last night was a great day for limited government, and a sign that economic matters are once again firmly at the forefront of the political discussion today.

Take note, folks.

Cross-posted to the right-wing liberal

The Fauxsterity Chronicles: Greece

At first read, the Examiner headline gives the impression that Greece is finally getting the message about what needs to be done – “Greek Workers to be Fired.” Here are the details:

The civil service redundancies, with a target of 15,000 by the end of next year will target “disciplinary cases and cases of demonstrated incapacity, absenteeism, and poor performance, or that result from closure or mergers of government entities”.

The sackings will overturn a Greek constitutional guarantee of jobs for life for civil servants, aimed at protecting public sector workers from unfair dismissal due to their political affiliations.

The special protections and widespread political cronyism or corruption led to the Greek civil service becoming bloated, with 700,000 officials in a country of less than 11 million people.

“It’s still a taboo to dismiss people from the public sector. There have been no forced dismissals of employees whose positions are eliminated or who for some reason do not perform,” said Mr Thomsen.

Note that “Mr. Thomsen” refers to Paul Thomsen, who speaks for the International Monetary Fund on the Greek file – and who, at first, looks like he finally drove the important message home.

Well…not so fast (Boston Globe, emphasis added):

(Greek PM Antonis) Samaras said 15,000 civil servants would be removed by the end of 2014, with 4,000 of them by the end of this year. New young employees will be hired in their place.

. . .

Minister for Administrative Reform Antonis Manitakis said Greece’s creditors had long been pressing for 15,000 public sector workers to be sacked without being replaced, but the agreement to hire new workers in their stead followed the higher-than-anticipated number of retirements — more than 180,000 of which are expected between 2010-2015.

On one level, this is just maddening; on another level, it is revealing. The IMF, European Central Bank, and European Union – by agreeing to this – have made it abundantly clear that this was never about genuine economic reform. Governments in Europe can be just as big, bloated, and burdensome on the private sector as they wish. They just have to make sure the accounting isn’t out of whack.

This is classic big-government-on-the-cheap – or, as I now prefer, Fauxsterity – and the “troika” just endorsed it.

In other words, Europe will never fix itself, because Brussels doesn’t want that. So it will be more tax increases and chicanery like this, until it all comes crashing down…

…after German voters are duped into thinking all is well on Election Day, of course.

Cross-posted to the right-wing liberal

The Prez’s budget: higher taxes and higher spending

You read that right: the president’s ten-year budget plan calls for higher spending over the next ten years.

Patrick Brennan (Corner) provides the details on the tax side, and finds that the total tax increase actually comes to just over $1 trillion.

That means less than of the “$1.8 trillion in additional deficit reduction” is actually spending “cuts” (about $800B). Why did I put “cuts” in quotes? Because the president’s budget also cancels the sequester, meaning that $1.2T in cuts are “replaced.”

Thus, actual deficit reduction is roughly $600B, and with the $1T in tax hikes, spending actually rises by $400 billion over the next decade under the president’s budget.

Maddening.

Cross-posted to the right-wing liberal