Now, here’s a guy who can make you wake up screaming. David M. Walker, former Comptroller General of the United States, was on the radio yesterday. He laid out exactly how broke America is, and what the consequences are likely to be. Stephen King has nothing on Mr. Walker. He is also a former head of Jeremiah’s favorite former government agency, the GAO. You can see a video of him here. Oops, no you can’t! The 404 errors have started already.
In the interview, Walker scares the hell out of Terry Gross. Naturally, she blames it all on president Bush. Walker’s senate testimony, however, states that the crisis will not be solved by ending the war, ending earmarks, cutting defense, lapsing the Bush tax cuts or ending “waste & fraud.” He is after the big nut, the structural deficit, which means Social Security.
Surprisingly, Walker does not want to privatize social security. He just wants Congress to stop stealing from it. He casually mentions “Social Security cash surpluses, which have been used to help finance other government activities.” What? Our contributions aren’t sitting in a bond fund?
Categories: Finance
Tagged: deficit, GAO, social security
It was grim watching Mitt Romney take his ritual beating on Fox News. He was on the program to promote his new book and, obviously, his 2012 presidential bid. The book, titled “No Apology,” is a defense of American exceptionalism, and Mr. Romney wanted to talk about geopolitics.
This is a book about what we need to do to strengthen America globally and make sure that our geopolitical position and military position is stronger.
His interviewer, however, wanted to talk about health care and abortion. On even-numbered days, the right attacks president Obama for being “stuck” on health care. This was Sunday, though, and time to pillory Mr. Romney for his own efforts on the matter. The argument, tortured as it was, seemed to be that since Congress is slowly coming around to a plan much like then-Governor Romney’s – that plan must be a bad one.
Mr. Romney is a successful businessman with a solid record of administrative skills. By contrast with professional politicians, he can be relied upon to balance budgets, meet deadlines, etc. He is not, however, a good dissembler – and so, probably unelectable. After a prolonged beating on health care, Chris Wallace got round to his coup de grace. He accused Mr. Romney of “flip-flopping” on abortion.
Mr. Romney stammered and made an excuse for leaving “social issues” out of his book. It looked an awful lot like flip-flopping. If he wants to be president, Mr. Romney must learn to control the debate. He should have cited his honest opinion on the matter, something like, “I don’t care a fig about your social issues – not while Iran is building the bomb.”
Categories: Civil Rights
Tagged: geopolitics, Iran, social issues
Warning, this video contains material you may find offensive – second graders in California, forced to write letters of protest to the governor. Are they protesting global warming, perhaps? No. Their teacher, one Jody Hoffman, has the little tykes protesting cuts to the school budget. No self-interest there …
You will make our teachers, and other people that are poor, lose their jobs. So, please don’t make them lose their jobs.
A real educator would have helped the kids to understand the challenge facing Governor Schwarzenegger – and how to pronounce his name. Why does the evil Snort-a-Jigger want to cut our beloved music program? Why can’t he cut the fire department instead?
It’s hard to blame Ms. Hoffman. She is a product of this same educational system, with its socialist mindset. Daddy government can always find the money, if only we cry hard enough.
Categories: Education
Tagged: budget, California, schools
Our latest inductee is Senator Blanche Lincoln, now being drummed out of the Democratic Party for voting against “public option” and the GM bailout, among other heresies. Senator Lincoln faces stiff opposition in the Arkansas primary. The AFL-CIO, which usually supports incumbent Democrats, has organized $4 million in contributions for rival Democrat Bill Halter.
This left-wing attack on a Centrist Democrat exactly mirrors the right-wing attacks on Centrist Republicans like Scott Brown. Senator Lincoln is a leading bipartisan and a founder of the Moderate Democratic caucus. As she says:
I don’t answer to my party, I answer to Arkansas
Gerald McEntee of the AFL-CIO put it best, when he spoke of drawing a line in the sand. Moderates in both parties live in fear of crossing somebody’s line in the sand. Just look at the hate directed against Senator Brown on Facebook, or ex-Democrat Joe Lieberman – purged for the same beliefs as Senator Lincoln’s.
If Senator Lincoln is Scozzafava’d by her Party, perhaps she will follow Honest Joe’s lead and run as an independent.
Categories: Center Field
Tagged: Honest Joe, litmus test, unions
Jeremiah recalls the first oil shock, in 1973, and so he was dismayed to live through another one in 2008. This is a “fool me twice, shame on me” story. Shame on Congress, that is, for enacting a cowardly regulation instead of doing what needed to be done. Back in 1973, we all drove econo-boxes like the Ford Fiesta. We hated it. As soon as the Arabs let up, we went back to driving trucks. The Fiesta, however, remained a best-seller around the world.
If gas prices had stayed high, we would have adjusted. We would have moved closer to work, invested in rail systems, and produced more fuel-efficient cars. Detroit would have risen to the challenge, and American auto makers would still be relevant. OPEC foresaw this, of course, and dropped oil prices just low enough to keep us hooked.
Europe made the adjustment. They developed the infrastructure to withstand another oil shock, and now European companies dominate the relevant technologies, like high-speed rail. Europe’s leaders kept the price of gas high by taxing it – not usually a challenge for American lawmakers – and so developed a resistance to OPEC.
Mike Jackson, the CEO of AutoNation, has called for Congress to end the regulatory regime known as CAFÉ and raise gas taxes instead. Why is the nation’s largest car dealer calling for a gas tax? Because CAFÉ forces car companies to produce cars that people don’t want to buy. Fuel-efficient cars become loss-leaders, to appease the government.
The result of CAFÉ is a charade, wherein the government pretends to regulate fuel efficiency and the automakers pretend to comply – a charade that only enriches the lobbyists. It punishes the auto industry for the sins of the oil industry. A rise in gas prices would hurt working people in the short term but, in the long term, it would make America stronger.
Categories: Finance
Tagged: gas, OPEC, tax
Now that Congress has captured the Fed, the next voice to be silenced is the GAO. Already there is an ominous dearth of reporting on America’s debt crisis. The GAO, which had been shrieking from the rooftops, has not produced a new analysis since October. Download that one here, before it vanishes from the web site.
Free spenders in Congress would like Americans to believe that we won’t go broke until 2035 – the fantasy budget known as “baseline extended.” The GAO has the temerity to place our day of reckoning in the immediate future.
The longer action is delayed, the larger the changes will need to be, increasing the likelihood that they will be disruptive and destabilizing.
The Times has photos of what “disruptive” looks like in Greece right now. America will be the next Greece, and Congress doesn’t want you to know it. Expect future GAO forecasts to be rose-tinted.
Categories: Finance
Tagged: Greece, politicize, spending
Senator Scott Brown describes himself as a fiscal conservative and a social moderate. This formulation challenges voters to think of fiscal policy and social policy as two different things, instead of the old left-right divide. This means that policy choices can be sorted into four buckets instead of two. Of course, real politics is more complicated than that, but – for voting purposes – two dimensions are better than one. Here, then, is a two-dimensional taxonomy:
Fiscal and Social Conservative
This is the new, socially-oriented Republican Party. There are no Democrats in this box, and not even all Republicans. For these people, the social dimension dominates, which means protecting their ideal of social organization and family values in particular. They are often blind to fiscal policy, and they consider social moderates like Sen. Brown to be false Republicans.
Fiscal Progressive and Social Conservative
It is hard to find any voters in this category. Most people who are social conservatives are also fiscal conservatives, or at least indifferent to fiscal policy. To find leftist fiscal ideas together with social conservatism, you have to consider old-school union labor – intolerant of social minorities and big business alike.
Fiscal and Social Liberal
Modern Democrats have the advantage of moral consistency. Since the 1960s, Democrats have been socially liberal, anti-war and hostile to business. They favor big government and they don’t mind high taxes, especially taxes on corporations and “the rich.” Since they have been in the majority, Democrats have drifted ever farther to the left.
Fiscal Co
nservative and Social Moderate
This is the grand old Republican Party, as Barry Goldwater and Ronald Reagan knew it – small government, low taxes and states’ rights. Goldwater fought a losing battle against the religious right, as did his successor John McCain. Today, only “northeast Republicans” are in this category, along with “blue dog” Democrats.
Ask yourself which part of “taxpayer-funded abortion” offends you, or “bank bailout.” The answer may be more complicated than you think.
Categories: Center Field
Tagged: Goldwater, left, right
Nations face the same budget constraints as households. They cannot spend more than they earn, without going into debt, and they will not be long in debt before the collector comes calling. A surprising number of people can’t grasp this simple fact, including people who are in charge of national budgets.
Greece’s budget deficit is 12.7% of GDP, and now they can’t get financing. Prime Minister George Papandreou has resisted making any budget cuts. He is a socialist, and committed to his welfare state.
“We want to be able to borrow on the same terms as other countries in the euro zone,” he said. This is like having a 500 FICO score and wondering why you can’t buy a car.
We want to be able to borrow on the same terms as other countries
Sadly, the Greek public has become dependent on handouts from the state. This is a moral weakness Jeremiah sees developing in America, too. Greeks are now rioting over losing their entitlements. A responsible government would face the fact that outsiders, like Germany, are not obliged to bail them out.
But this is not a responsible government, and Mr. Papandreou is not facing facts. Instead, he is blaming “speculators” for manipulating the debt market. The socialists are blaming “the bourgeois,” of all things, and government officials are even blaming the Nazis.
To read the popular press, you would think that the IMF and the ECB had mounted an armed invasion of Greece. The bottom line is that the Greek government needs a loan, and there is no one foolish enough to give them one. Whatever agency steps in – probably the IMF – will demand austerity measures. Mr. Papandreou must either implement the measures or face default. For a household, this is like choosing between bankruptcy and the credit counselor.
And so it goes. First comes socialism, then comes the debt crisis, and finally the IMF to pick up the pieces. The budget deficit in America is 10.6%.
See also: Greece’s Budget Crisis
Categories: Finance
Tagged: Greece, IMF, socialism
This week’s National Review has an article applauding Senator Jim DeMint (R-SC) for his efforts to rid the Party of moderates like Arlen Specter. He has even started a conservative PAC for the purpose. This is the same hidebound ideology that cost the Republicans a seat in New York. At the time, Jeremiah warned that Olympia Snowe (R-ME) would be targeted next. Indeed, Senator Snowe recently wrote that “being a Republican moderate sometimes feels like … you’re no longer welcome in the tribe.” It’s worth reading her editorial, entire.
“The only litmus test of what constitutes a Republican [is] our belief in restraining government spending, pro-growth policies, tax reduction, sound national defense, and maximum individual liberty.” – Ronald Reagan
Right-wingers like Sen. DeMint present voters with a Hobson’s Choice. With the Democrats, we have runaway government spending, and with the Republicans we have reactionary “social conservatism.” Unbelievably, the National Review cites the recent victory of Scott Brown in Massachusetts – conveniently forgetting that Sen. Brown, a moderate, is exactly the kind of Republican Sen. DeMint opposes.
Categories: Center Field
Tagged: abortion, conservative, RINO
Jeremiah’s vision for health insurance is a broad national market like the one for auto insurance. Everyone will buy it, and insurers will compete on cost and service. Health insurers will then drive innovation and cost control, as the IIHS does today.
Some feel that “individual mandate” infringes a constitutional right not to have insurance. This is an impractical theory that only holds up if hospitals have an offsetting right to deny care. Since people are going to turn up in the Emergency Room, they must have health insurance – just as everyone who might need a car repair is required to have auto insurance.
Congress should outlaw enrollment restrictions such as “pre-existing condition,” but allow insurers to charge a competitive price based on the enrollee’s health – and then make subsidies available for those who demonstrate financial need. Help with premiums would be the only application of public funds, and the only avenue for redistribution.
The subsidies would be offset by ending the tax deduction for employer-paid health insurance – with no special pleading for union jobs. Workers who think their company plan is free are sadly mistaken. The only benefit in this “benefit” comes from the tax deduction.
Jeremiah was shocked to learn that there are barriers to interstate competition. These have to come down, and this is an appropriate use of federal power under the commerce clause. Speaking of states’ rights, there should be tort reform but it should be at the state level. If Missouri wants to run the doctors out and the premiums up, that’s their prerogative.
Lastly, Congress must allow pharmaceuticals – with appropriate safety regulation – to be imported. Drug companies have a right to recoup their R&D expense, but they don’t need to recoup all of it in America. Once there is a vibrant market for health insurance, we will see the insurers do battle with the drug companies. Voters will love that.
See also: New York Times
Categories: Health
Tagged: individual mandate, insurance, privatize
Now, here’s a guy who can make you wake up screaming. David M. Walker, former Comptroller General of the United States, was on the radio yesterday. He laid out exactly how broke America is, and what the consequences are likely to be. Stephen King has nothing on Mr. Walker. He is also a former head of Jeremiah’s favorite former government agency, the GAO. You can see a video of him here. Oops, no you can’t! The 404 errors have started already.
