Week in Review
Susan Rice said it. Hillary Clinton said it. And President Obama said it. Over and over again. The attack on the U.S. mission in Benghazi was due to a YouTube video that incited a spontaneous protest that resulted with an attack on the mission with assault weapons and pre-sighted mortars. Highly improbable but that’s what they said. Over and over again. It wasn’t a terrorist attack. Because President Obama killed Osama bin Laden and won the War on Terror. The 2012 campaign slogan was Osama bin Laden is dead. General Motors is alive. And al Qaeda is on the ropes. On the run. No longer a threat to the United States. That’s why we had to reelect President Obama. For he sure couldn’t point to any successes when it came to the economy.
Of course beefing up security in Benghazi would have harmed that narrative. So while the British were pulling out of Benghazi because a resurgent al Qaeda was making it too dangerous the U.S. State Department denied Ambassador Steven’s request for additional security. Because a resurgent al Qaeda was making it very dangerous in Benghazi. But the American people didn’t hear that. No. All they heard was that Osama bin Laden is dead. General Motors is alive. And al Qaeda is on the ropes. On the run. No longer a threat to the United States. Of course the murder of four Americans in Benghazi said otherwise (see Former CIA official: No politics in Benghazi memo by DONNA CASSATA, AP, posted 4/2/2014 on Yahoo! News).
The CIA’s former deputy director said Wednesday he deleted references to terrorism warnings from widely disputed talking points on the deadly 2012 Benghazi attack to avoid the spy agency’s gloating at the expense of the State Department…
Morell, a 33-year veteran of the agency who has served six Republican and Democratic presidents, insisted that politics had no bearing on the revisions to the talking points and said he was under no pressure to protect either President Barack Obama or then Secretary of State Hillary Rodham Clinton…
The White House, wrapped up in a fierce presidential campaign, made only minor editorial changes to the talking points, according to the onetime CIA official.
The intelligence community’s talking points, compiled for members of Congress, suggested the Sept. 11 attack stemmed from protests in Cairo and elsewhere over an anti-Islamic video rather than an assault by extremists.
Republicans have accused the Obama administration of trying to mislead the American people about an act of terrorism in the final weeks before the November election.
Morell deleted references to extremist threats linked to al-Qaida in versions of the talking points that were used by Susan Rice, then U.S. ambassador to the United Nations, in a series of Sunday talk show appearances. Morell said his actions were driven by the information provided by intelligence community analysts and the Defense Department.
The deleted references to terrorism in the talking points were not political? His revisions to the talking points were not to protect either President Barack Obama or then Secretary of State Hillary Rodham Clinton? Funny. As that’s exactly what they did. They protected President Obama and helped him win reelection. And they protected Hillary Clinton. Who is now the Democrat frontrunner for 2016. Well, so far, at least.
The left is still trying to blame 9/11 (the first one in 2001) on President Bush and Condoleezza Rice. For missing the signs that al Qaeda was a threat. And that something big was coming. Can you imagine the fury over Benghazi had it happened under President Bush’s watch? While they were in a campaign season? There would be no talking point revisions. They would have lambasted President Bush and Condoleezza Rice. The press would have torn into this story like a pack of hyenas tearing into a gazelle. The media would have crapped all over the Bush administration. But the Obama administration? When the president, Hilary Clinton and Susan Rice all lied about a YouTube video? Over and over again? When the CIA revised the talking points so it didn’t sound like there was a problem with terrorism anymore? All lies. And a huge cover-up. But we hear nothing but the sound of crickets from the media.
Sure, they can say it wasn’t political. But the result of those revisions was very political. It helped President Obama win reelection. Because he had al Qaeda on the run. Which he didn’t. In fact, his foreign policy has made the world a more dangerous place. For al Qaeda is resurgent everywhere. In Egypt. Libya. Syria. Iraq. Afghanistan. Yemen. And elsewhere. Oh, and Iran is working on a nuclear bomb. And Vladimir Putin annexed Crimea to Russia. Because he could. This stuff is happening in part because people voted for President Obama believing the lie that al Qaeda was on the run. When it wasn’t. And because we reelected President Obama his failed foreign policy continues. As the bad people of the world stand up and take notice.
The United States of America under President Obama is weak. It may talk the talk but it sure doesn’t walk the walk. So the bad guys are getting bolder. Knowing the time is right to push the United States around. For we are a sleeping bear that just can’t be wakened. Apparently.
Tags: Al Qaeda, Benghazi, Condoleezza Rice, Hillary Clinton, Obama administration, Osama bin Laden, politics, President Bush, President Obama, protests, resurgent al Qaeda, Susan Rice, talking points, terrorism, terrorist attack
Week in Review
Many were shocked that President Obama won reelection. What with the horrible economy. And the Benghazi scandal. But what was even more shocking was why Mitt Romney lost. And it wasn’t because of the Hispanic vote. It was because conservatives sat at home on election night. Instead of voting. Baffling many. Especially with the huge conservative turnout during the 2010 midterm elections. Thanks to the Tea Party movement. Which seemed strangely quiet during the 2012 campaign. Now we know why they were quiet during that election. Because the IRS was actively silencing their voice.
Whoa, whoa, said the Democrats. Now hold on a minute. The IRS is politically neutral. And the fact that 95% of the policy-makers at the IRS donated to the Obama campaign doesn’t make the IRS politically biased. Besides, progressive groups were targeted just as much as conservative groups. So there. Of course, the Treasury Department Inspector General for Tax Administration begs to differ (see Treasury: IRS targeted 292 Tea Party groups, just 6 progressive groups by PAUL BEDARD posted 6/27/2013 on the Washington Examiner).
Refuting Democratic suggestions that progressive groups were also swept up in the IRS probe of the tax status of Tea Party organizations, the Treasury Department’s inspector general has revealed that just six progressive groups were targeted compared to 292 conservative groups.
In a letter to congressional Democrats, the inspector general also said that 100 percent of Tea Party groups seeking special tax status were put under IRS review, while only 30 percent of the progressive groups felt the same pressure.
The Wednesday letter to the top Democrat on the House Ways and Means Committee punched a huge hole in Democratic claims that progressive groups were targeted as much as the Tea Party groups from May 2010-May 2012, the height of the Tea Party movement.
The letter from the Treasury Department Inspector General for Tax Administration revealed that there just weren’t many progressive groups who even sought special tax exempt status. A total of 20 sought it, and six were probed. All 292 Tea Party groups, meanwhile, were part of the IRS witchhunt.
Well, well, well. The IRS influenced the 2012 election by suppressing the Tea Party’s ability to raise money to pay for political ads. As some in the Tea Party suffered onerous IRS audits in response for their tax-exempt status request. While others wanted to avoid an onerous IRS audit. By keeping their name off of any Tea Party fundraiser list. Resulting with a subdued Tea Party voice in the 2012 election. Allowing the IRS to prevent a repeat of the 2010 midterm election. By abusing the power of their office. And getting the man they supported with donations 95% of the time return to office for a second term. But the IRS isn’t politically motivated. For they are politically neutral.
Tags: 2010 Midterm Election, conservative groups, conservatives, IRS, IRS audit, Progressive, progressive groups, Tea Party
Week in Review
The IRS abuse of conservatives was not politically motivated. Because the IRS said so. Even though the scandal was not isolated to a few rogue agents in Cincinnati. As we have recently learned (see IRS supervisor in D.C. admits to overseeing ‘tea party’ targeting by David Sherfinski posted 6/17/2013 on The Washington Times).
An IRS supervisor working in Washington told congressional investigators that she personally reviewed applications from groups for tax-exempt status, in testimony that appears to show the agency’s scrutiny of conservative groups extended beyond the confines of the office in Cincinnati.
Holly Paz, who was a supervisor in the Internal Revenue Service’s tax-exempt status division, indicated during an interview with congressional investigators that she did review such applications, but indicated that she believed “tea party” meant political advocacy in general — not necessarily conservative groups.
Ms. Paz said she did not believe any overt political motivation was causing the delays in applications for groups from 2010 through 2012, and that she knew of liberal groups that were heavily scrutinized as well.
Really? Funny that it appears to be only conservative groups that have come forward reporting this extensive scrutiny. And that it was only conservatives who were muzzled during the 2012 election. As they couldn’t collect anonymous donations like those liberal groups could. As a list of the conservative donors somehow found there way from the IRS to liberal websites. And the fact that 95% of the policy-makers at the IRS donated to the Obama campaign doesn’t make it political, either. No. There’s nothing political going on at the IRS.
So the IRS scandal goes all the way to Washington. Will the people learn this? Will the people even care? Conservatives do. But those more preoccupied with social media could care less about things not covered in the mainstream media as little more than an afterthought. But when the networks, Jon Stewart and Stephen Colbert hammer away at another GOP ill-informed comment about rape? That enters social media. So the people know this. And care. Which is why they don’t seem to care about abuses against conservatives. Because based on what they learn from watching the networks, Jon Stewart and Stephen Colbert they just assume they deserve it. Because they are so intolerant. Unlike them. Who are so tolerant that they don’t mind the intolerance of others attacking those they don’t agree with.
Tags: Cincinnati, intolerant, IRS, political motivation, rogue agents in Cincinnati, scrutiny of conservative groups, Tea Party
Week in Review
President Obama’s Treasury Department’s IRS is caught harassing perceived enemies of the Obama administration. To help stifle their free speech during the 2012 election. But they deny it was political. And apologize (see IRS apologizes for targeting conservative groups by STEPHEN OHLEMACHER posted 5/10/2013 on the AP).
The Internal Revenue Service apologized Friday for what it acknowledged was “inappropriate” targeting of conservative political groups during the 2012 election to see if they were violating their tax-exempt status.
IRS agents singled out dozens of organizations for additional reviews because they included the words “tea party” or “patriot” in their exemption applications, said Lois Lerner, who heads the IRS division that oversees tax-exempt groups. In some cases, groups were asked for lists of donors, which violates IRS policy in most cases, she said…
About 75 groups were inappropriately targeted. None had their tax-exempt status revoked, Lerner said.
The IRS is an independent agency within the Treasury Department that enforces the nation’s tax laws. Revelations that the agency was targeting political groups because they were affiliated with a movement that is critical of President Barack Obama could become a new headache for the White House…
IRS Commissioner Douglas Shulman told Congress in March 2012 that the IRS was not targeting groups based on politics.
How can this be anything but politics? And a gross misuse of power?
The Obama administration would identify organizations with ‘Tea Party’ and ‘patriot’ in their name as enemies of the Obama administration. For with every shooting or bombing on American soil the go-to people are the ‘anti-government’ Tea Party and patriot people. Radical conservatives as they call them. Of course it hasn’t yet turned out that a mass murderer was a radical conservative. They have been either radical Islamists. Or people with mental health problems.
After what we’ve learned about the Benghazi cover-up this past week is it really hard to believe that the Obama administration used the power of the IRS against political opponents? President Nixon did that. So why not President Obama?
Both President Obama and President Nixon lied to the American people to improve their reelection chances. Who would have thought that the guy who wanted to be compared to FDR would actually be more like President Nixon? Of course, with President Nixon there was a crime. A break-in. But no one died. As they did in Benghazi. Because the Obama administration just couldn’t grant the requests of Ambassador Stevens for more security after President Obama declared the War on Terror was over. For the 2012 campaign message was that ‘Osama bin Laden was dead. And General Motors is alive’. With bin Laden gone al Qaeda was defeated. At least that was what the Obama administration was saying. After bin Laden’s death there were no more radical Islamists trying to kill Americans. This was why we needed to vote for President Obama. For he made the world a safer place. And beefing up security in Benghazi wouldn’t help that message before the election. So they denied Ambassador Steven’s request. For what could possible happen?
A full-scale military assault. That’s what. Which was even worse to the Obama campaign than beefing up security. The Obama administration couldn’t have this. So they concocted the story about the anti-Islamic YouTube video and a spontaneous uprising. And when the intelligence reports came in identifying an al Qaeda affiliated terrorist group they took their talking points and edited them down. Pulling anything ‘militant Islamist’ out of them. This despite the president of Libya confirming the al Qaeda connection. This kept the Benghazi mess quiet through the election. And what’s to say they might have set the IRS on their political opponents to help keep the Benghazi mess quiet through the election?
They lied about Benghazi. So they’re probably lying about the IRS. The very same people they’re putting in charge of the funding of Obamacare. Who will be looking ever more closely at our employers. And our personal lives. But there’s nothing to worry about. For the IRS would never use their power for political purposes. Not with the most transparent presidency since the Nixon administration. Well, perhaps not quite as transparent as the Nixon administration. Then again, it’s probably one of the least transparent administrations in U.S. history. In fact, the Nixon administration was probably more transparent and honest than the current administration. Nixon may have lied. But he didn’t leave his embassy staff unprotected. So enemies of the United States could kill them. And then lie to cover it up.
Tags: 2012 election, Al Qaeda, Ambassador Steven, Benghazi, bin Laden, enemies of the Obama administration, IRS, Nixon, Osama bin Laden, Patriot, President Obama, radical conservative, radical Islamists, Tea Party
Week in Review
The past few years haven’t been great for organized labor. They’ve spent a fortune in union dues to win President Obama’s reelection. But though they won that battle they may be losing the war (see Spending large sums in state labor battles adds to unions’ problem of losing members by FOX News/AP posted 12/23/2012 on FOX News).
Unions represented roughly 30 percent of the country’s workforce in the early 1980s, when the federal government started tracking those numbers, but they now represent 11.8 percent.
The declining numbers are in part the result of the country’s shrinking manufacturing sector, but the situation has been compounded by recent efforts in Michigan and Wisconsin to limit unions’ power.
Unions had already spent roughly $22 million in Michigan on a failed November ballot issue regarding collective bargaining, before Republican Gov. Rick Snyder signed legislation this month that stops unions from making workers pay dues or representation fees to keep their jobs…
They also spent more than $20 million in Wisconsin to remove Republican Gov. Scott Walker this year in a recall election after he signed 2011 legislation stripping most public employees of much of their collective-bargaining power, but Walker still won that election.
The unions also spent roughly $24 million last year in Ohio to overturn an anti-union measure.
But unions spent more in California this year to defeat a ballot measure that would curb dues collection than they did total on political efforts in Michigan, Ohio and Wisconsin.
James Sherk, a labor expert with the conservative Heritage Foundation think tank, estimates Michigan unions, including United Auto Workers, will lose an additional $100 million annually as a result of the changes and members leaving.
Workers have already “left unions in droves in Wisconsin, Idaho and Oklahoma,” he said.
If you do the math that adds up to $66 million for Michigan, Wisconsin and Ohio. Double that to add in California and that brings it up to $132 million. Throwing in the estimated $400 million in the 2012 elections that brings the total up to $532 million.
That’s half a billion in union dues they spent for political purposes. Perhaps explaining why workers are leaving the unions in droves where they can. Especially when the American people identified themselves at the end of 2011 as 40% conservative, 35% moderate and 21% liberal (see Conservatives Remain the Largest Ideological Group in U.S. by Lydia Saad posted 1/12/2012 on Gallup). As a lot of those union dues go to support liberal candidates and liberal causes they no doubt bothered the 79% of the population that isn’t liberal. Especially those paying those dues.
Tags: California, collective bargaining, liberal, liberal candidates, liberal causes, Michigan, Ohio, organized labor, union dues, unions, Wisconsin
Week in Review
When it comes to government policies there are unintended consequences. And then they are the ‘I don’t care what the consequences are’ as long as those policies are politically expedient (see US childhood obesity dips for first time in decades: study by AFP posted 12/27/2012 on channelnewsasia.com)
CHICAGO: Obesity rates among small children may finally be on the decline after more than tripling in the United States the past 30 years, a study out Wednesday indicated.
The study found that obesity rates peaked in 2004 and then declined slightly among low-income children aged two to four who receive benefits from a federal food stamp program called SNAP…
In an accompanying editorial, Dr. David Ludwig said the declines seen are not enough, and he urged an overhaul of the federal food stamp program (SNAP) to help low-income families tackle obesity by eliminating junk food and adding more fruit and vegetables to their diet.
“SNAP is essential for hunger prevention in the United States, but its exclusive focus on food quantity contributes to malnutrition and obesity, and is misaligned with the goal of helping beneficiaries lead healthier lives,” wrote Ludwig, who works in an obesity prevention centre at Boston Children’s Hospital…
Ludwig noted that it pays for an estimated US$4 billion in soft drinks per year, which adds up to about 20 million servings of soda a day.
“The public pays for sugary drinks, candy, and other junk foods included in SNAP benefits twice: once at the time of purchase, and later for the treatment of diet-induced disease through Medicaid and Medicare,” he wrote.
“The nation’s US$75 billion investment in SNAP could provide a major opportunity to reduce the burden of diet-related disease among low-income children and families if policies that promote nutritional quality are instituted.”
Peaked in 2004? Why, that was when George W. Bush was president. At least 4 years before Michelle Obama began her war on childhood obesity. To ensure success she should consult with George W. Bush. Who must have done something right to reverse a trend that was in the making for 30 years. And not her husband. Who appears to be hell-bent on making children obese again.
One of the major causes of childhood obesity has been the federal food stamp program. Which President Obama has expanded like no other president. Even earning himself the moniker ‘The Food Stamp President’. Guess he doesn’t like kids. Well, not all kids. Just the poor ones. Who he is helping to a life of diet-induced disease.
So the president may be sacrificing another generation of children to heart disease, diabetes and all those other diet-induced diseases. Why? Well, like Bill O’Reilly said, to give the people stuff. So they will vote for him. Which he has. And our poor children will pay the ultimate price with poor health. While we pick up the cost for their extensive and costly medical care.
Tags: childhood obesity, diet-induced disease, diet-related disease, federal food stamp program, food stamp, obesity, obesity rates, President Obama, SNAP
Week in Review
One of the harshest printed criticisms of President Obama doesn’t come from the US. It comes from the UK. From our friends in Britain. Who have long been willing to tell kings that they aren’t wearing any clothes (see Under Barack Obama the US superpower faces four more years of decline by Nile Gardiner posted 11/8/2012 on The Telegraph).
The world needs powerful American leadership, the bedrock of which rest upon a sound economy, limited government and free enterprise, as well as a strong national defence. But it certainly won’t be provided by Obama’s imperial presidency. In his first term of office, an administration that worshipped bailouts and big government built up staggering levels of debt that threaten to saddle future generations with the profligate spending of their forefathers. Instead of hope, President Obama offered only the heavy fist of government intervention, rising taxes, increasing poverty and welfare dependency, and an increasingly bitter, angry and insular White House.
There is no reason to expect a different approach in Obama’s second term. His re-election will only embolden his deep-seated left-wing instincts, which are to “transform” the United States into a European-style social democracy. There is good reason why the Obama administration has been a wholehearted backer of the European Project – because it sees its ideals as a role model for America, not a warning.
Under the Obama administration, the very foundations of the world’s only superpower are being undermined by a $16 trillion national debt that has increased by 50 percent under President Obama – a staggering debt per taxpayer of $111,414. Incredibly, US per person debt is now 35 percent higher than that of Greece, according to a chart produced by the Republican side of the Senate Budget Committee. As The Weekly Standard reported earlier this week…
At the same time, economic freedom has declined dramatically, with the United States falling to 10th place in the world rankings, with government spending now exceeding one third of total domestic output. Adding further to the $1 trillion federal budget deficit, the White House has pushed through a vastly expensive health care reform package that harkened back to the failed European social model rather than the American dream.
You’d be hard-pressed to read something like this in a major US paper. Which explains why print media is going the way of the dodo bird. In a nation that has conservatives outnumbering liberals 42% to 23% the masses aren’t going to read a paper that is nothing more than an extension of the liberal Democrat Party. The fact that per capita debt in the US is greater than in Greece is BIG news. For Greece is falling apart from the weight of a European-style social democracy. The kind of thing President Obama wants to build in the US. So that bit of news would have been useful for the people to form an informed opinion on the direction of a second Obama term. But doing so would have been harmful to the liberal agenda. So the liberal-leaning press didn’t report this. And it wasn’t a factor in the 2012 election.
To get any news critical of Obama administration you have to go to FOX News, talk radio or our friends in Britain. Where they will tear apart any politician. Including Americans. Such as George W. Bush. So even if they endorse European-style social democracy and state institutions like the National Health Service they can still be critical of them. It would be nice to have a little of that in the US. A little of Bernstein-Woodward investigative journalism that investigates all politicians. Not just the ones with an ‘R’ next to their name.
Tags: conservatives, Democrat, European-style social democracy, Greece, liberals, Obama administration, President Obama, social democracy
Prices match Supply to Demand letting Suppliers know when to bring more Goods and Services to Market
There is a natural ebb and flow to the economy. Through good times and bad. And you can tell which way the economy is heading by prices in the market place. When prices are rising times are typically good. As people are gainfully employed with money to spend. As they compete with each other for the goods and services in the market place demand rises. Growing greater than the supply of goods and services. So prices rise. Because when there are fewer goods and services they are worth more money. For those who have them to sell. Because demand is so great people are willing to pay top dollar for them. To get them while supplies last. This attracts the attention of other suppliers. Who want to cash in on those high prices. So they bring more goods and services to market.
In time supply catches up to demand. And passes it. Suddenly the market has more goods and services than people are buying. As inventories grow retailers stop buying so much from their wholesale suppliers. Who in turn stop buying so much from their manufacturers. Who in turn stop buying so much from their raw material suppliers. And manufacturers and their raw material suppliers begin laying off workers. So there are fewer people gainfully employed with money to spend. The fewer gainfully employed buy less than the more gainfully employed. Causing inventories to grow larger as more goods are going into them than are coming out of them. So they start cutting prices. To unload these inventories before people start buying even less. Because they spent a lot of money to build those inventories. And it costs to hold these items in warehouses and stockrooms.
And that’s the natural ebb and flow of the economy. What economists call the business cycle. That goes from an expanding economy to a contracting economy. From boom to bust. From inflation to recession. Something normal. And natural. Though it could be unpleasant for those who lose their jobs. But it’s something that must happen. To correct prices. You see, prices make all of this work automatically. They match supply to demand. Letting suppliers know when to bring more goods and services to market. And when they’ve brought too much. When the economy goes into recession prices fall. Which tells suppliers that supply exceeds demand. And that anything additional they bring to market will not sell. As they incur costs to bring things to market this is very good information to have. So they don’t waste money. Leaving their businesses short of cash. Possibly causing their businesses to fail.
Whenever we Devalue the Dollar with Inflationary Monetary Policy Prices Rise
No one likes losing their job. Because they need income to pay their bills. And the government doesn’t like people losing their jobs. Because they tax those incomes to pay the government’s bills. And unemployed people pay no income taxes. So the government tries to tweak the economy. At the federal level. To extend the inflationary periods of the business cycle. And they do that with inflationary monetary policy. Using their monetary powers to keep interest rates below the true market interest rate. Hoping it will encourage suppliers and consumers to keep borrowing and spending money. Even though supply had already caught up to and passed demand. Such that everyone that wanted to buy something could. While every supplier that wanted to sell something couldn’t.
Some people take advantage of these lower interest rates. Some people will remortgage their homes to lower their monthly payment. Which will give them a little more disposable cash each month. Which they may use to buy more stuff. But other people will take this opportunity to buy a large house just because of the low interest rate. As some businesses may borrow to expand their business just because of the low interest rate. Not for unmet demand. These actions may not help the economy. In fact they may hurt the economy in the long-term. When the inevitable recession comes along and they are so overextended they may not be able to pay their bills. They may lose their house. Or their business. For the worst thing to have whenever you suffer a reduction in revenue or income is debt.
But there is an even worse effect of that inflationary monetary policy. When you increase the money supply you increase the total amount of dollars in the economy. But they’re chasing the same amount of goods and services. Which makes each dollar worth less. Requiring more of them to buy the same things they once did. Which is why whenever we devalue the dollar with inflationary monetary policy prices rise. So, yes, there may be an initial expansion of economic activity. But some people will have inflationary expectations. That is, they know prices will go up in the very near future. So they won’t increase production. Why? While an initial burst of economic activity may draw down those bloated inventories those coming higher prices will increase business costs. Which businesses will have to pass on in the prices of their goods. And how do higher prices affect consumers? They buy less. So manufacturers are not going to expand production when price inflation is going to reduce their sales in the long run.
Cutting Taxes and Reducing Costly Regulations have Stimulated Economic Activity every time they’ve been Tried
Perhaps the worst effect of inflation is the false information those higher prices give. When consumer demand rises so do prices. And it’s a signal to suppliers to bring more goods and services to market. But when prices rise because of a depreciated dollar and NOT due to higher consumer demand, some may bring more goods and services to market when there is no demand for it. So you have rising prices. And expanding production. Producing more goods than the market is demanding. Creating a bubble. Adding a lot of stuff to the market place at very inflated prices. That no one is buying. Then the bubble bursts. And recession sets in. As businesses lay off workers to adjust supply to meet actual demand. And those inflated prices fall back to market values. The higher inflationary monetary policy pushed those prices up the farther they have to fall. And the more painful the recession will be.
You see, inflationary monetary policy interferes with the natural ebb and flow of the economy. And the automatic price mechanism that matches supply to demand. By trying to expand the inflationary side of the business cycle, and contract the recessionary side, governments make recessions longer. And more painful. Which is why Keynesian stimulus policies (lowering interests rates and deficit spending) don’t stimulate long-term economic activity. Yet it is what most governments turn to whenever the economy slows. While there is another way to stimulate economic activity. One that is not so popular with most governments. Across the board tax cuts on business and personal incomes. And reducing costly regulations on businesses. These make a more business-friendly environment. Encouraging businesses to expand and hire people. Because these actions will have a positive impact on a business’ long-term outlook. And with consumers having more disposable income (thanks to the cuts in personal income tax rates) businesses know there will be a market of any increase in production.
So there you have two ways to stimulate economic activity. One way that works (tax cuts and reducing costly business regulations). And one that doesn’t (lowering interest rates and deficit spending). So why is the one that doesn’t work chosen by most governments over the one that does? Because governments like to spend money. It’s how they build constituencies. By giving generous benefits to voters. But to do that they need tax revenue. Lots of tax revenue. Produced by increasing tax rates as often as they can. So they cannot stand the thought of cutting taxes. Ever. Which is why they always choose inflationary policies over tax cuts. Even though those policies fail to stimulate economic activity. As proven throughout the era of Keynesian economics. While cutting taxes and reducing costly regulations have stimulated economic activity every time they’ve been tried.
Tags: business cycle, Consumers, correct prices, costly business regulations, deficit spending, demand, economic activity, goods and services, income taxes, inflation, inflationary expectations, inflationary monetary policy, interest rates, inventories, Keynesian, Keynesian stimulus, lowering interest rates, lowering interests rates, manufacturers, market, market place, match supply to demand, monetary policy, prices, raw material suppliers, recession, retailers, stimulus, suppliers, supply, tax cuts, tax revenue, wholesale suppliers
Week in Review
According to the Left it’s the Republicans who enrich their friends in corporate America. But it wasn’t the Republicans that passed a near $1 trillion stimulus bill to enrich their friends in corporate America. No. That was the Democrats. And they really enriched their friends. Their friends in green energy. Those corporations that were supposed to create the jobs of the future. That created no jobs (see Examiner Editorial: Insiders get rich on Obama’s green energy stimulus posted 10/31/2012 on The Examiner).
According to a Washington Examiner analysis of publicly available data, corporate insiders at the 15 publicly traded green energy companies that received federal stimulus subsidies pocketed tens of millions by selling their stock after the government’s money poured in and before their companies’ values plummeted.
The Obama administration gave more than $700 million in grants and guaranteed an additional $500 million in loans to publicly traded green energy companies through its 2009 stimulus package. If Obama had invested all that money in a Standard & Poors index fund of the top 500 publicly traded companies, his investment would have seen a 73 percent return since he took office. In contrast, the Obama “green energy” stimulus portfolio has fallen by 78 percent — performing about five points worse than green energy companies that didn’t get subsidies.
The insider trades by officers and directors of these companies tell us still more. They cashed out a net $63.9 million in stock gains before their companies’ stock prices collapsed…
This analysis does not include some of the best-known Obama energy failures. Solyndra, for example, blew through more than $500 million in taxpayer-guaranteed loans before it could even go public. Another high-profile failure, First Solar, is not included because it sold off much of its $3 billion in federal loan guarantees to third parties before it laid off 30 percent of its workforce and its stock price declined by more than 90 percent from its 2011 high. The company’s head, Michael Ahearn, has extracted more than $329 million in stock sales since 2009 all by himself.
The problem with green energy is that it’s not economically viable. Few investors put their money in these ventures because investors are smart and know how to invest money wisely. Which is why the government is pouring money into these companies. Because no one else will. For these are not wise investments.
So where’s the outrage? The stimulus bill was greater than the money spent under TARP. The program to bail out all those troubled assets. Those toxic mortgages. That infuriated the masses so much they showed up outside some bankers’ homes with pitchforks and torches. Spawning the Occupy Wall Street movement. And the whole 99% against the 1%. But these green energy scandals? You can almost hear the crickets chirping as you read about them in the few papers that write about them. Why?
That’s a rhetorical question. We all know why. Except for a very few exceptions the media is liberal. And will actively support Democrats. And attack Republicans. That’s why a larger financial scandal gets less coverage than a smaller one. And the smaller one only got that coverage because in that coverage they failed to tell the whole story. It wasn’t the bankers that forced these borrowers into subprime mortgages. It was the government who forced the bankers to approve the unqualified for mortgages or else. Basically saying their lending practices were discriminatory and that if they didn’t change they would find themselves out of the mortgage business. So how do you qualify the unqualified for mortgages? With subprime lending. Which they did. And kept doing after Fannie Mae and Freddie Mac bought those toxic mortgages from them and unloaded them on unsuspecting investors. Which is the part they don’t tell the people with the pitchforks and torches. That it wasn’t the bankers who were responsible for the subprime mortgage crisis. It was the government.
And this is why the media doesn’t care about the green energy scandals. They can’t revise the facts to blame them on the Republicans. So they just ignore them.
Tags: corporate insiders, Democrats, green energy, green energy companies, scandals, stimulus, stimulus bill, subprime mortgage, TARP, toxic mortgages
Week in Review
Aging populations are plaguing advanced economies. In Japan. The United States. Britain. France. Spain. Italy. Greece. And others. All countries with large welfare states. Large deficits. And mountains of debt. Fewer people are entering the workforce than are leaving it. Resulting in a shrinking tax base. Requiring higher taxes. More borrowing. And when all else fails, budget cuts. Which is where the British are in trying to keep their NHS solvent. Cutting 20% from the NHS budget. While the US added Obamacare to a budget that is already causing record deficits. Caused by fewer people entering the workforce than are leaving it. So that’s how we got here. Now how does the future look (see CDC: U.S. Birth Rate Hits All-Time Low; 40.7% of Babies Born to Unmarried Women by Terence P. Jeffrey posted 10/31/2012 on CNSNews)?
The birth rate in the United States hit an all-time low in 2011, according to a report released this month by the federal Centers for Disease Control and Prevention…
While the overall birth rate declined to a record low, the birth rates for women in the 35-39 and 40-44 age groups actually increased from 2010 to 2011.
Pretty bleak. Not only are women having fewer babies they’re waiting another 10-20 years before having them. Which means when the full costs of Obamacare hit we’ll have perhaps an all-time low of new workers entering the workforce to pay the taxes to fund Obamacare. And the rest of that swelling welfare state.
In about twenty years our spending obligations will grow too great for taxes and borrowing to pay. Which means the US will have no choice but to follow the UK. And make massive spending cuts in our health care. Resulting in increased wait times. Rationing. And perhaps a little Greek-style protesting. Unless we repeal Obamacare. And make some serious reforms in our two most costly programs. Medicare. And Social Security. If we do we can save them. If we don’t we probably can’t save them. This is the choice we have to make. Forced onto us by a declining birthrate.
Tags: aging population, birth rate, borrowing, budget cuts, debt, deficits, NHS, Obamacare, taxes, welfare state, workforce