The Democrats make the Poor travel for Hours by Bus to do their Grocery Shopping

Posted by PITHOCRATES - August 18th, 2013

Week in Review

The Democrats champion unions.  And the poor.  Which creates a bit of a problem for Democrats.  As unions actually help to keep the poor poor.  Union employees raise selling prices higher than non-union employees.  Which is why cars built in the union North are more expensive than cars built in the non-union South.  And why the world’s largest retailer, Wal-Mart, can sell at such low prices.  Because their stores use non-union labor.  Which the Democrats hate.  And work actively to prevent them from moving into new neighborhoods.  Which may explain problems like this (see How access to fresh food divides Americans by Iris Mansour posted 8/15/2013 on CNNMoney).

Twenty-nine million Americans live in urban and rural food deserts, according the U.S. Department of Agriculture (USDA). By this definition, Americans in low-income rural areas have to travel at least 10 miles to get to their nearest supermarket. While city dwellers from low-income neighborhoods have to travel a mile or more.

In America, where the car is king, a 15-minute, one-mile drive doesn’t seem unreasonable. But if you live in a dense city like Washington D.C., that may mean having to take two hour-long bus rides in each direction to get to a supermarket, with shopping bags in tow…

But why the supermarket shortfall..?

Brian Lang, Director of the National Campaign for Healthy Food Access at The Food Trust says supermarkets stay away because urban settings force them to rethink the shape and size of their stores. Walgreens (WAG) can’t transplant its standard rectangular layouts from the sprawling suburbs into tightly packed neighborhoods. TRF’s Hinkle-Brown highlights another issue. A supermarket’s employees tend to live very nearby. “If they’re operating in low-income areas, they’re less work-ready. It takes six months longer to train them, and insurance costs are higher in urban areas,” he says.

Jeffrey Brown has experienced these problems firsthand. He operates six ShopRite supermarkets in former food deserts and five in suburban areas. He explains that suburban grocery stores, like his own, can expect to make a 1% net profit after tax, while his urban stores initially showed a 4% loss, resulting in a 5% gap between urban and suburban profits…

Hinkle-Brown explains that in 2004 he couldn’t get a meeting with a national grocery store. But today Target (TGT) and Wal-Mart (WMT) are opening smaller urban stores. “They realized that the big business frontier of revolutionary growth was behind them,” says Hinkle-Brown.

Walmart has a made a commitment to open 275 to 300 stores in food desert areas by 2016.

Most of these food deserts are in impoverished parts of big cities.  That are Democrat.  Like Detroit.  San Francisco.  Seattle.  Boston.  New York City.  And Washington D.C.  Where the local Democrat governments have done everything within their power to keep Wal-Mart out (see Washington D.C. and Detroit say ‘No’ to Wal-Mart because they don’t need Jobs or Shelves full of Low-Priced Goods posted 7/20/2013 on Pithocrates).  Because they care more for their dues-paying union supporters than the poor.  Apparently.

Wal-Mart can make life better for so many.  And they want to.  But because they’re non-union the Democrats are keeping them away from the people that would benefit most from them.  It’s not the Republicans doing this to the poor.  It’s the Democrats doing this to the poor.  And they’re supposed to be the protector of the poor?  Let’s hope the poor remember this the next time they vote.  Of course, for that, the Democrats will drive them to the polls.  Because that’s what they really care about.  Their vote.  Not how many hours they have to travel by bus to do their grocery shopping.

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FT97: “The poor may hate the rich yet that doesn’t stop them from trying to be rich.” -Old Pithy

Posted by PITHOCRATES - December 23rd, 2011

Fundamental Truth

Politicians use Class Warfare to Blame Others for their Economic Destruction

Class warfare is on the rise.  Which is typical during a presidential election season.  Especially when a president’s policies haven’t exactly improved the economy.  When your policies give Jimmy Carter’s misery index a run for its money you have to find something else to run on beside your record.  So you blame the rich.  Which tends to go over well for those who aren’t rich.  Because while they’re cutting back to stretch what little they have to last in the face of record unemployment, the rich aren’t.  It doesn’t help the un-rich.  But somehow having someone to hate brings them some comfort.

So they listen to the class warfare.  And like what they hear.  The rich aren’t paying their fair share of taxes.  Rich people paying millions in tax dollars isn’t enough.  They should pay more.  But they try not to.  Because they’re selfish.  Evil.  They hate poor people.  Hungry people.  Children.  And they really hate poor, hungry children.  For it is the rich who always oppose paying more taxes to help these people.  The poor never do.  They are always in favor of taxing the rich more to help other people.  To help themselves.  Because the poor aren’t selfish.  Or greedy.  Like the rich.  The rich have more than enough.  Everyone knows this.  So they should pay more in taxes.  After all, fair is fair.

At least, this is the thinking of class warfare.  It’s sort of like magic.  Magicians use misdirection to take your eyes away from what they’re really doing.  A little sleight of hand.  Doing something with one hand while they have you looking at the other.  You’re amazed.  And feel entertained for being fooled.  You like it.  And asked to be fooled again.  Politicians have picked up on this human desire.  And use it to their advantage.  To get us looking at something completely different.  And not the economic destruction they’re causing.  And then, like magic, we blame the rich for all the ills in our lives.

Poor People know one thing for Sure, it is Better to be Rich

So the rich are greedy, evil and selfish.  The scum of the earth.  We have nothing good to say about them.  Because money is the root of all evil.  And anyone who has money must be evil.  A classic American novel set during the Great Depression, The Grapes of Wrath, epitomized this when the mother wanted to treat her men to some sugar in their coffee but couldn’t afford it.  She asked for just a little free sugar.  The clerk said she couldn’t.  Because she wasn’t the owner.  And would get in trouble if she did.  But she gave her a little sugar anyway.  And slipped some of her own money into the till to pay for it.  A rich person wouldn’t do this.  Only a poor person would help another poor person.  Because the poor are good.  And the rich aren’t.

This is why class warfare works.  But there is a fatal flaw in it.  The poor people may say they hate the rich and want them punished, but it’s the poor people who are predominantly buying lotto tickets.  Why?  To become rich.

Rich people don’t buy lotto tickets.  Poor people do.  In hopes of a Cinderella rags to riches story.  Because poor people know one thing for sure.  It is better to be rich.  And they will spend their meager wages on lotto tickets for that gazillion in one chance of becoming rich.

More Government Benefits paid for by the Rich is the Ultimate Goal of Tax and Spend Class Warfare

Of course, a person’s definition of ‘rich’ differs from another.  And for the most part it’s relative.  To their own wealth.  Anyone who has more than them is rich.  And because someone always has more than they have they are not rich.  Simple.  So class warfare works.  Despite its fatal flaw.

But class warfare isn’t about fairness.  It’s just misdirection.  A little political sleight of hand.  To help a politician escape blame for the economic damage they’ve caused.  By tapping into a base human trait.  Greed.  That insatiable desire to get-rich-quick.  By spending their meager wages for that gazillion in one chance.

Or for more government benefits paid for by the rich.  The ultimate goal of tax and spend class warfare.  Something the poor are all for.  Because fair is fair.  Until, that is, they do win the lotto.  And these people see what it’s like to have more than others have.  As people crawl out of the woodwork to ask for some of their new found wealth.  Because they have more than enough.  And should share.  Because fair is fair.

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LESSONS LEARNED #68: ” Beware the demagogue, the champion of the poor, for he has dictatorial aspirations.” -Old Pithy

Posted by PITHOCRATES - June 2nd, 2011

Robespierre used the Sans-culottes

A telltale sign of royalty is a really nice pair of pants.  With a perfect, sharp crease.  But that’s today.  Back in the old days, it was a handsome pair of silk knee-breeches.  The wealthy in pre-revolutionary France all wore them.  I say ‘pre-revolutionary’ because it was not the thing to wear during the revolution.  In fact, a group of people who could not afford these fancy breeches took pride in their plain pants.  The poor working class in the cities.  Artisans and small shopkeepers.  The little guys.  Struggling to make a living.

These people did not wear the ‘culottes’ (French for ‘silk knee-breeches’) of the upper classes.  So they went ‘sans’ them (French for ‘without’).  Hence they were the Sans-culottes.  They were the people without silk knee-britches.  And the mob behind the French Revolution

They were Leftist radicals.  Anti-capitalists.  And the far-Left radical Jacques Roux used them for muscle.  Turned them against the bourgeouis (the middle class).  Caused a whole lot of unrest.  Some food riots.  And a massacre or two.  Roux was becoming too powerful so Maximilien Robespierre, a Jacobin, had him arrested.  Then he used the Sans-culottes to consolidate his power.  With the opportune assassination of Jean-Paul Marat (a Jacobin leader), Robespierre became the leader of the Jacobins and of the Revolution.  For awhile.  With the help of the Sans-culottes, he unleashed the Reign of Terror.  Marat’s assassin was a Girondin.  The Girondins were the political rivals of the Jacobins.  So Robespierre put Marat’s assassination to good use and cleaned house.  And by ‘clean house’ I mean killed as many of his political opposition as possible.  It was the time to kill.  If you didn’t like someone all you had to say was that he or she was a counter revolutionary.  And they got a date with the guillotine.  In all some 16,000 (or more) lost their heads during the Reign of Terror.  Including Robespierre himself.  Live by the guillotine.  Die by the guillotine.  And soon thereafter the Sans-culottes became less of a force as the government pulled back from the extreme Leftist radicalism of the Terror to a more conservative one.

Communist Leaders exploited the Proletariat

Marxism arose as a criticism of capitalism.  Which exploits the working class (according to Marxism).  The proletariat.  Who own nothing but their labor.  And are forced to sell it for day-wages to those who own the means of production.  The industrial bourgeoisie.  The proletariat wants to maximize their pay.  The bourgeoisie wants to maximize their profits.  Of course, one can only gain if the other loses.  Ergo, this is a class struggle.  Between the working majority.  And the capital owning minority.  Which is wrong according to Marxism.  And can only end in a proletarian revolution.  After which everyone will live a life of plenty in a classless, stateless, property-less society.  Because everyone will feel the love and work real hard to produce a lot.  Even though they won’t make an extra dime for all their extra work.  It will be a social utopia where society takes from those according to ability and gives to those according to need.  And they’ll sing workers’ songs as they eat and drink and scratch their fat bellies at the end of the work day.

As a social utopia, it’s a pretty nice one.  Especially to the working class who have worked some pretty hard lives.  So they are quick to show a lot of need.  And little ability.  Because those with the most ability have to work the hardest.  Whereas those with the greatest need get more stuff.  Even if they don’t work.  At all.  According to theory, at least.  The working class may be uneducated laborers, but they understood this.  Especially when a leader came along to lead a proletarian revolution.  I get more for working less?  I’m with you, brother.  There have been quite a few such revolutions.  Though there are some degrees of differences, we can call most of these communist revolutions.  Because communist leaders based their philosophy on some form of Marxism.

Many countries had communist revolutions.  Russia was the first.  It became the Soviet Union.  Then China.  It became the People’s Republic of ChinaNorth Korea.  And Cuba.  To name a few.  And how did the proletariat make out in those countries?  Well, suffice it to say it wasn’t quite the utopia they were expecting.  By fighting for the people, Joseph Stalin became one of the greatest mass murderers of all time.  Beating out Adolf Hitler by scores.  There was no utopia in the Soviet Union.  Unless you liked fear and oppression.  And going hungry and lacking the necessities of life.  Ditto in China.  Only their proletariat wasn’t urban workers.  They were rural farmers and peasants.  Forced into collectivized farms.  Where food production plummeted.  Resulting in one of the 20th century’s most horrific famines.  Between famine, fear and oppression, Mao Tse-tung gave Joseph Stalin a run for his money as the greatest mass murderer of all time.  Not sure who won as records are a little sketchy.  But they probably hold first and second place.  Don’t know much about North Korea because it’s such a closed society.  But they suffer some of the greatest famines of modern time.  And spend most of their nights in the dark as they have little energy (seen from space you can tell North Korea from South Korea by the lights).  And the Cubans have more than once tried to escape their social utopia by crossing the Atlantic Ocean in rickety boats and rafts to reach America. 

Life got worse for the working class in general under communism.  But it got pretty good if you were in the communist party.  It was that ‘from those according to ability to those according to need’ thing.  It didn’t work in practice.  Because it turns out people want to benefit from their labors.  Which is the basis of the proletarian revolution in the first place.  And making them work harder for less just wasn’t going to cut it.  Especially when life was better under capitalism.  For it was better when the capitalist bourgeoisie did the exploiting than the communist party.  And it wasn’t just because of the famine, fear and oppression that came with the communists.  Because the capitalists paid you according to the quality of your labor.  Not by the quantity of your need.  So the harder you worked, the more they paid you.  And that’s the kind of thing that’ll get people to work harder.  Incentive.

Peron exploited the Descamisados

Tim Rice is one of the greatest lyricists in musical theater.  Andrew Lloyd Webber‘s greatest works were those he did with Rice.  Joseph and the Amazing Technicolor Dream CoatJesus Christ Superstar.  And Evita.  The story of Eva Perón.  Wife of Juan Perón.  And their rise to power in Argentina.  With the help of their descamisados.  The poor, shirtless workers.  Who loved Eva Perón.  As she loved them.

The musical Evita has a Che Guevara-like narrator named Che who tells the story.  And participates.  He sees the Peróns for who they are.  Sees how they exploit the descamisados for personal gain.  And bankrupts the nation.  Rice does a great job of turning this story into some great songs.  This story of a workers’ revolution is accessible.  And entertaining.  Here are some of the lyrics.  Starting with the workers’ demands.

Nationalization of the industries that the foreigners control
Participation in the profits that we make
Shorter hours
Higher wages
Votes for women
Larger dole
More public spending
A bigger slice of every cake

The hallmarks of any workers’ revolution.  Which of course the leader of the workers’ revolution promises in exchange for their vote.  Even though he would prefer not to have to deal with that pretense.

It’s annoying that we have to fight elections for our cause
The inconvenience–having to get a majority
If normal methods of persuasion fail to win us applause
There are other ways of establishing authority

Then the secret police echo these thoughts.

We have ways of making you vote for us,
or at least of making you abstain

Perón wins the election.  And gives his first speech on the balcony of the Casa Rosada.

Argentinos! Argentinos! We are all shirtless now!
Fighting against our common enemies–
Poverty, social injustice, foreign domination of our industries!
Reaching for our common goals–
Our independence, our dignity, our pride!
Let the world know that our great nation is awakening
and that its heart beats in the humble bodies of Juan Peron
and his wife, the first lady of Argentina,
Eva Duarte de Peron!

Yes, he is just one of them.  Shirtless.  And poor.  Though he says this from the ‘pink’ house.  Which is more palace than house.  Che is in the crowd.  And is not amused.

As a mere observer of this tasteless phenomenon, one has to admire the stage management
There again–perhaps I’m more than a mere observer –
listen to my enthusiasm, gentleman! Peron! Peron! Peron!
Look, if I take off my shirt, will you-

At which point the security police beat him and take him away.  For they don’t like dissenters.  Typical revolutionary stuff.  But in a story told so well.  Thanks to the great lyrics of Rice.  And the music of Webber.  And after Perón gets his power, how does Argentina do?  Does Perón deliver that Promised utopia?  Che explains in a brief but passionate monolog.

What’s new Buenos Aires? Your nation, which a few years ago had the second largest gold reserves in the world, is bankrupt! A country which grew up and grew rich on beef is rationing it! La Prensa, one of the few newspapers which dares to oppose Peronism, has been silenced, and so have all other reasonable voices! I’ll tell you what’s new Buenos Aires!

It’s a story as old as time.  The revolutionary leaders get richer.  The workers get poorer.

(The original Broadway cast recording includes Patti LuPone as Eva and Mandy Patinkin as Che.  Who’ve set the bar for these roles.  You can’t get better.  So buy this recording.  You won’t regret it.)

Famine, Fear and Oppression never take a Holiday

Sans-culottes, proletariats, descamisados or some other poor class of people a revolutionary leader champions, it always ends the same.  The leaders of the revolution always seem to do better.  And the poor class continues to suffer.  Often worse off than they were before.  Some leaders come and go.  But the suffering of the masses usually lingers.  For famine, fear and oppression never take a holiday.  But liberty does.  Sadly.

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Rich Liberals Champion the Poor to Maintain their Privileged Lives

Posted by PITHOCRATES - April 2nd, 2011

Per-Vote-Subsidy replaces Corporate and Union Money

Canada has a spoils system when it comes to public financing of political campaigns.  The big pile of public money ‘donated’ by the Canadian taxpayer is divided between the parties by vote.  The more votes a party gets, the more tax subsidies that party gets.  The Canadian prime minister, Stephen Harper, wants to do away with these subsidies (see Harper vows to scrap per-vote subsidies by CTV.ca News Staff posted 4/1/2011 on CTV.ca).

Currently, political parties receive a $2-per-vote subsidy, but Harper has long opposed the system, which was brought in by the Liberals when corporate and union donations were banned.

He said Friday that political parties already enjoy “enormous tax advantages” and taxpayers should not have to support parties they don’t support with their votes. Harper added that the subsidy only helps to ease the way for frequent elections.

Interesting.  Unlike the United States, Canada does not allow corporations or unions donate to political parties.  And when that ban went into place, the liberals brought in the per-vote-subsidy.  It takes money to win political contests.  And when you shut down two big sources (corporations and unions), that money has to come from somewhere else.  So the liberals decided to get that money from the taxpayer.  Fair, right?  I mean, without these subsidies, political power falls to the rich.  And that’s not fair, is it?

The Liberals are the Rich trying to Buy Political Power

When they banned corporate and union donations that left private donations.  From actual people.  So I guess we would have to see how that money flowed to see whether the per-vote-subsidy is fair and serves its purpose.  To keep the rich from wielding political power over the poor (see Analysis: Fears about scrapping per-vote subsidies wildly off target by Patrick Brethour, Vancouver, posted 4/2/2011 on The Globe and Mail).

Data compiled by the website Punditsguide.ca show that funds raised by the parties largely come from small donors, in amounts that would make few Canadian households cringe…

Take the Conservative Party in 2009, which raised… an average [per person] donation of $174.60…

The story is pretty much the same with the other parties: the NDP, with an average donation of $169.11; the Bloc Quebecois, average $102.63; Green Party, $123.21; and the Liberals, with an average of $239.23, the highest of the major federal parties.

Looking at the average per-person donation, it appears the liberal donors are richer than the conservative donors.  Kind of goes against everything the liberals tell us.  That conservatives are nothing but a bunch of rich fat-cats who want to use the poor as footstools.  Either that or conservatives are just cheap bastards.

The same picture emerges when looking at the distribution of donations by size. For the Conservatives, about 10 per cent of the funds raised came from those giving between $1,000 and the maximum of $1,100; conversely, two-thirds came from those giving $400 or less. The NDP were similar, with 7 per cent coming from the highest donated amount, and 70 per cent coming from donations $400 and under. The Liberals – who have fulminated against the perils of the rich controlling the political process – were actually the party most dependent on big donations, with 35 per cent of their cash coming from donors giving between $1,000 and $1,100, while sub-$400 donors accounted for just 38 per cent of the funds the party raised.

In fact, the Liberals outperformed among big donors, raising $3.2-million to the Conservatives’ $1.7-million. The Tories made up that ground, and more, with small donors.

And what do these numbers tell you?  Liberals rely on rich people for their political donations.  Conservatives rely on the little guy, the average working person who can barely afford to donate $200.  And the big corporations and the big unions pour money into liberal political parties.  In ‘soft ways‘ these days.  In Canada.  In the United States.  All around the world.  So much money that it was hard for the little guy to fight against it.  Leaving political power in the hands of the rich.  Much like the liberals say they want to prevent with the per-vote-subsidy.  But, in fact, that’s exactly what they want to do.  Leave political power in their rich hands.

You see, the crony capitalists and the snooty rich don’t like the little guy.  They like the good life that few can enjoy.  And sometimes they need special favors from government to continue that privileged life.  Which is why they donate to liberal parties.  But when they banned ‘hard money’ donations from corporations and unions, liberals had to scramble for other financing.  Because the majority of people don’t support their views.  So they need to ‘force’ donations through these per-vote-subsidies.  For it is the only way they can continue to rule against the will of the people.

The People who Supported Obamacare get Obamacare Waivers

It’s always about the money.  Whenever you’re confused about some political debate, just ask yourself this simple question.  Where’s the money?  Take health care, for example.  The goal of Obamacare was to provide everyone with high-quality yet affordable health care insurance.  Sort of like paying for a Big Mac and getting filet mignon.  Impossible, yes, but that’s what they told us. 

Big Business and the unions were all behind it.  Everyone (employers and unions) wants to dump their health care costs.  That’s why they were anxious for that public option.  Well, they didn’t get the public option.  Not yet.  First Obamacare has to put the private insurers out of business.  Once it does that then the government can step in as the insurer of last resort and, presto, they’ll get their national health care.  But leaves a costly problem for the here and now.

To ‘pass’ CBO, they had to include some onerous requirements.  The new law forced everyone to buy insurance.  The insurers had to cover preexisting conditions.  And they forbade insurance companies to recover their full overhead expenses.  Suddenly affordable insurance was going to become unaffordable.  Or people were simply going to lose their insurance because they couldn’t afford the premiums that were necessary to comply with the requirements of Obamacare.  So many of those who supported this legislation want no part of it.  For themselves, that is.  It’s okay for us.  But not for them.  So they’re asking that the law does not apply to them.  Only us (see List of health reform waivers keeps growing by Jason Millman posted 4/2/2011 on The Hill).

The number of waivers the Obama administration has awarded for a provision of the year-old healthcare reform law grew by 128 in March.

With the new waivers, that means 1,168 businesses, insurers, unions and other organizations have received one-year exemptions from a healthcare reform provision requiring at least $750,000 in annual benefits.

Nancy Pelosi said we needed to pass Obamacare to learn what was in it.  Apparently another 128 insurance plans learned what was in it this past March.  And they want out.  Like the majority of Americans.  Which really begs the question why Obamacare?  It isn’t popular.  They had to pass it quickly before anyone could read the bill.  None of the unions want it.  So why have it?  Because liberals want it.  And why do politicians want anything?  Follow the money.

The Free Market provides High Quality and Low Prices

Hillary Clinton tried to socialize our health care.  Now Obamacare is a short step from doing just that.  Because they said only government could step in and fix our health care system.  That the so-called free market had failed.  Really now?  Because that’s the one thing that has been missing from our health care system.  Market forces.  Doctors providing medical services for a fee that their patients actually pay for.  Not a third party insurance bureaucrat.  But the actual patient.  Until now, that is.  And that free market?  It works.  It’s providing a fully funded quality system that people of average means can afford (see High-end medical option prompts Medicare worries by Ricardo Alonso-Zaldivar, Associated Press, posted 4/2/2011 on the Sun Journal).

Every year, thousands of people make a deal with their doctor: I’ll pay you a fixed annual fee, whether or not I need your services, and in return you’ll see me the day I call, remember who I am and what ails me, and give me your undivided attention.

But this arrangement potentially poses a big threat to Medicare and to the new world of medical care envisioned under President Barack Obama’s health overhaul.

The spread of “concierge medicine,” where doctors limit their practice to patients who pay a fee of about $1,500 a year, could drive a wedge among the insured. Eventually, people unable to afford the retainer might find themselves stuck on a lower tier, facing less time with doctors and longer waits.

People actually paying to see a doctor?  Imagine that?  Just like in the old days.  Before there was a health care crisis.  The patients are happy.  The doctors are happy.  And making a very nice living.  You can’t get much more of a win-win situation, can you?  Who could find fault with this?

The trend caught the eye of MedPAC, a commission created by Congress that advises lawmakers on Medicare and watches for problems with access. It hired consultants to investigate.

I guess the government could.  Big Brother is everywhere.  And he is looking at this free market solution.  And Big Brother is not amused.  People paying for their own medical care?  That’s a problem for those in government.  A big problem.

Several members said it appears to be fulfilling a central goal of Obama’s overhaul, enhancing the role of primary care and restoring the doctor-patient relationship.

Yet the approach envisioned under the law is different from the one-on-one attention in concierge medicine. It calls for a team strategy where the doctor is helped by nurses and physician assistants, who handle much of the contact with patients.

John Goodman, a conservative health policy expert, predicts the health care law will drive more patients to try concierge medicine. “Seniors who can pay for it will go outside the system,” he said.

MedPAC’s Hackbarth declined to be interviewed. But Berenson, a physician and policy expert, said “the fact that excellent doctors are doing this suggests we’ve got a problem.”

You see, one-on-one concierge medicine is bad because it lets doctors work freely with patients.  The government would prefer something along the current lines.  You treat patients.  And then we’ll think about paying you.  And how much we’ll pay you.  Like in the Medicare program now.  That way you’re our bitch.  But if you work outside the system, you and your patients will be free.  And we don’t like that.  Why?  Follow the money.

Follow the Money for the Money Never Lies

Politics is always about the money.  Always has been.  Always will be.  Because it takes money to gain and maintain political power.  Whether you’re running a political campaign.  Or supporting a campaign with your union dues in exchange for political favors (such as legislation that limits competition so unions can maintain their high wage and benefit packages).

Liberals are a minority of the population.  Wherever you are.  The majority of people don’t belong to a union or work for the government.  This majority has jobs.  They take care of their family.  And want Big Brother to leave them alone.  Union dues from a small percentage of the population can greatly influence elections, though.  They can’t donate directly.  But that money finds its way to liberals.  Liberals in the U.S. desperately need this money.  In fact, union dues have become so important to the ruling liberal elite that they created an entire new class of union-paying people.  The public sector union class.  Who has but one purpose.  To launder tax dollars from taxpayers to the Democrat Party.

The 2010 mid-term elections shook up the political establishment.  Conservative governors are fighting back against this new political class.  And the liberal left is attacking these governors.  Even President Obama sent activists to Madison, Wisconsin, to protest against Governor Walker as they voted to make their public sector workers live more like the rest of the people in Wisconsin.  This is why Obamacare is so important to the left.  Health care is 17% of GDP.  That’s a lot of money.  That’s why the public option is so important.  Why nationalized health care is so important.  Because of this money.  Liberals want this money to pass through Washington.  Where they can easily skim a little off the top for their political needs.  And to live well.  Without actually having to work.  Like that majority that pays all those taxes.

Life’s greatest question can be easiest answered by following the money.  For the money never lies.

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FUNDAMENTAL TRUTH #45: “The bluest of cities in the bluest of states have the most activist governments, the deepest recessions and the most abject poverty.” -Old Pithy

Posted by PITHOCRATES - December 21st, 2010

Blue States Bleeding Red

We call it the Great Recession.  It started with the subprime mortgage crisis.  Then the dominoes started falling.  And unemployment rates started to climb.  So many people lost their jobs that it wasn’t only banks and auto companies staring into the abyss of bankruptcy.  Our city and states were, too.

But not all our cities and states.  Some were hanging in there during the Great Recession.  There was a pattern.  Sure, it was a rule with some exceptions, but a general rule all the same.  And if you looked at one of those red/blue electoral maps, you could see the states (and the cities) having the biggest financial troubles.  You just looked for the blue.

The blue states are the ‘Democrat’ states.  The red states are ‘Republican’.  And the states that are in the news with financial troubles tend to be the blue states.  The New England States.  The Mid-West states.  And the West Coast states.  The rate of business failures and high unemployment rates have hammered these states.  Taxable income plummeted.  Without the income to tax, tax revenue plummeted.  And these blue states are bleeding red.

Blue States and Unionized Public Sector Employees

These are the Big Government states.  Home for most of the nation’s liberal democrats.  Although liberal democrats make up only about 20% of the national population, most of them live in these states.  And when you pack a lot of this 20% into these small areas, their influence can reach a majority.  And they can control these cities and states.  And do.

These liberals are the guilty rich (anti-capitalist inheritors of great wealth).  Crony-capitalists (anti-capitalists who eschew the free market and bribe politicians in exchange for governmental favoritism).  Big Union (anti-capitalists who eschew the free market and seek legislation that favors them).  The celebrity rich (anti-capitalist movie stars, musicians, painters, artists, etc., who don’t live in the real world).  University professors (anti-capitalists who still have posters of Che Guevara up in their classrooms).  The mainstream media (anti-capitalists who want to shape opinion instead of practicing journalism).  And, of course, the poor and government-dependent.

And then you have public sector employees.  Unionized public sector employees.  And their ranks are growing.  They don’t work very hard.  But boy are they paid well.  And talk about fat benefits.  Pension plans that most can’t even imagine.  They have made themselves a privileged class.  And with their boss having the power to tax, that privileged class will be remaining privileged for a long time to come.  Unless a Great Recession comes along.

Much of Flyover Country not having any Budget Crises

What is flyover country?  It’s that are area of the country liberals fly over when traveling between the West Coast, the Big Union Mid-West, New England and, of course, Washington D.C.  It’s that area in between.  The red states.  You see, liberals fly over the red states because they don’t like them.  Or Republicans.

Because America is a center-right nation, and the liberals have concentrated in the blue states, that has left most of ‘fly over’ country conservative.  And what do conservatives NOT like?  Big Government.  So liberals don’t go where they’ve not welcomed.  For Big Government is the heart and soul of liberalism.

So the red states don’t have Big Government.  They don’t have masses of government-dependent people.  And they don’t have large public sectors.  Or public sector union employees.  Which means they don’t have huge Big Government budgets.  Or budget crises.

The Public Sector Out Paces the Private Sector in the Blue States

But the blue states do.  Their Big Cities are packed with government-dependent people.  And they have a huge public sector to cater to these people.  And a public sector union that pays this public sector very well.  They have pay and benefit packages that are to die for.

Of course, a public sector doesn’t make anything.  They have no goods or services that they can sell in the free market.  They have but one source of income.  Taxes.  And when times are good, taxes are good.  But when times are poor, so are taxes.

Part of the liberal democrat’s strategy to remain in power is to get as many people as possible dependent on government.  This helps make Democrat voters (people who vote Democrat because they are afraid of losing their government benefits).  And justifies their huge government budgets.  So they keep adding people to the public dole.  And keep growing their budgets.  It’s a foolproof plan.  As long as the private sector grows along with the public sector.  So the private sector can keep paying the taxes to support the public sector.  And the privileged class.

Big Government – The Road to Bankruptcy

But it doesn’t always work.  When businesses fail they don’t have any income.  So they can’t pay any income taxes.  And when a business fails people lose their jobs.  And their incomes.  So they don’t pay any income taxes either.  But it doesn’t end there.  Without any income, they can’t buy anything in the free market.  So other businesses see their sales decline.  And have to lay off employees.  And these laid-off people can’t buy anything in the free market.  So more businesses see their sales decline.  And they lay off people.  And on and on it goes.  Where does it stop?  Usually in a bad recession.  Or even a great one.

You add all of this up and what do you get?  Big cities with growing budgets (and growing pension obligations).  And shrinking tax revenue to pay for it.  Costs exceed revenues.  Ergo, bankruptcy.

And some of the states with the most generous public sector pay and benefits are California, Illinois and New York.   Some of the bluest of blue states.  And coincidentally, these are the states facing some of the biggest budget crises.  Actually, it’s no coincidence.  It’s the ultimate consequence of Big Government.  Bankruptcy.

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The Anatomy of a Subprime Mortgage Crisis

Posted by PITHOCRATES - October 17th, 2010

Old Time Politics – Buying Votes

There’s a lot of lying going on about the subprime mortgage crisis.  How it happened.  Who was responsible for it.  Was it the banks and their predatory lending?  That’s who Barney Frank blames.  Well, them and Republicans.  Or was it some more of that irrational exuberance that led to a real estate bubble?  It created a dot-com bubble in the 1990s.  Which in turn caused a recession.  Was it just a little history repeating itself?  Perhaps they both played a part.  But if they did, they were minor supporting roles.  They weren’t the star of the crisis.  For neither could have done anything had it not been for their enabler.

The Boston Globe’s Donovan Slack writes about one of the enablers backpedaling on his previous rosy statements about the two companies at ground zero of the crisis (see Stance on Fannie and Freddie dogs Frank on boston.com).  Fannie Mae.  And Freddie Mac.  Frank is running for reelection.  And his words are coming back to haunt him.

America is a center-right nation.  To counter that, the Left courts a coalition of special interests and single-issue voters.  Federal workers, teachers, unions, gays & lesbians, pro-choice feminists, environmentalists, socialists, minorities, etc.  Each taken by themselves is a very small percentage of the voting population.  But taken together it’s a sizeable percentage.  Then add in one more very important Democrat constituency.  The poor.  Now with all of these firmly in the Democrat’s camp, it’s just a matter of getting enough of the moderate and independent vote to win an election.  Of course, this is a moot point if they DON’T lock in the Democrat base.  And they do this by giving away as much free stuff and favorable legislation as possible. 

Give Me Your Tired, Your Poor, Your Huddled Masses Yearning for a House They Can’t Afford

The key to locking in the base is, of course, the poor.  There are a lot of them.  So the Left courts them.  Engages in class warfare.  They paint the Republicans as rich fat-cats who want to take their welfare, social security, food stamps, etc., away from them.  That they want to keep them in slums or throw them onto the street.  In contrast, they, the Democrats, want to provide for them.  To help them.  And they give them a lot of things.  To earn their gratitude.  And their votes at the election booth.  And the grandest of all the things given to them?  Affordable housing.

Poor people don’t have a lot of money.  That’s pretty straight forward but it needs to be said.  Because people who don’t have a lot of money can’t afford to buy a house.  Again, that’s pretty straight forward.  But it needs to be said.  Now, when these people apply for a mortgage and get denied, why do you think they got denied?  Here’s a hint.  Re-read this paragraph.  They get denied because they don’t have a lot of money.  You see, if you don’t have a lot of money, you can’t buy expensive things.  Again, straight forward.  But it needs to be said.  Again.  And often.

Now, what do you think a politician thinks the reason was for these poor people getting their mortgage applications denied?  Red-lining.  Racism.  Classism.  Unfairism.  (Yeah, that isn’t a word.  But it works.)  A large percentage of those denied mortgages are from the inner city poor.  And because of previous white-flight, that inner-city poor also happens to be primarily minority.  Hence the charges of racism.  And that’s just gold to a political party who needs poor minorities to vote for them.

The Siren Song of Affordable Housing

Now Barney Frank is running for reelection.  His Republican challenger is using Frank’s own words in his campaign.   And they’re causing some damage.  For Frank sat on the House’s Financial Services Committee (the oversight committee for Fannie Mae and Freddie Mac) throughout the time the crisis built.  And now he’s answering some very uncomfortable questions (this and all quotes are from Stance on Fannie and Freddie dogs Frank).

Frank, in his most detailed explanation to date about his actions, said in an interview he missed the warning signs because he was wearing ideological blinders. He said he had worried that Republican lawmakers and the Bush administration were going after Fannie and Freddie for their own ideological reasons and would curtail the lenders’ mission of providing affordable housing.

Ideology trumped responsibility.  The Left cries foul when the Right doesn’t reach across the aisle, but the Left never reaches out when they have power.  It’s us against them.  Pure partisanship.  Even when there’s great danger brewing.  It’s their interests first.  Then the country’s.  So he protected Freddie and Fannie.  And enabled them to cause greater harm.

Freddie and Fannie are in the secondary mortgage market.  They don’t write mortgages.  They guarantee them (so banks are more willing to take risks with less credit-worthy people).  And they buy these risky mortgages from the banks.  This further reduces a bank’s risk in approving very risky loans to people who are not credit-worthy.  Which is what the Democrats want.  More affordable housing for people who can’t afford to buy houses.  Frank’s committee sets the rules Freddie and Fannie must follow to keep them from approving mortgages that are crazy-stupid.  But that’s exactly what they encouraged.  Subprime loans.  Adjustable Rate Mortgages (ARMs).  Interest only mortgages.  No documentation approvals.  Any bank that didn’t have enough of these mortgages on their books (i.e., risky loans to poor people who couldn’t afford to buy houses) was in trouble.  The federal government would investigate them for red-lining, racism, classism, etc.

The more mortgages Freddie and Fannie bought, the more cash banks had to make more risky loans.  They then dumped these risky loans onto Wall Street.  You see, before the day of subprime loans, ARMs, interest only mortgages and no documentation approvals, mortgages were very safe loans.  But these subprime loans weren’t.  But they looked safe when Wall Street sold them.  I mean, buyers didn’t see the mortgage applications.  They had no idea what a credit risk these people were.  They just knew mortgages were traditionally safe investments.  So they just bought them.  And Freddie and Fannie made it all possible.

Known as government-sponsored enterprises, they didn’t provide mortgages themselves, but rather bought loans from banks and mortgage brokers, freeing up cash so the lenders could make more loans. Fannie and Freddie held or bundled the loans and sold them to investors as mortgage-backed securities.

Investors bought these very ‘profitable’ securities.  This demand just fueled the crisis in waiting.  Because Freddie and Fannie could dump these on Wall Street, they wrote more and more risky loans.  This made everyone happy.  Everyone was making money.  And more people who couldn’t afford to buy houses were buying houses.  And this was, after all, Freddie and Fannie’s mission.  Affordable housing.

In an effort to increase homeownership, the Clinton administration in the late 1990s and the Bush administration in the 2000s pushed Fannie and Freddie to meet growing quotas for buying affordable home loans. Those pushes, combined with a drive for more profits at the enterprises, drove Fannie and Freddie to take on more risk and more debt. They backed subprime and other risky loans, including mortgages for borrowers without proof of steady income.

Even the Republicans got on the band wagon.  New homes sales drive the economy (because of the stuff people have to buy to put into those houses that they can’t afford).  And you make points with the poor and the minorities.  There was just no down side in affordable housing.  Or was there?

But the director of the federal office responsible for overseeing Fannie and Freddie, Armando Falcon, began noticing their expanding portfolios and increasing reliance on risky investments. In early 2003, Falcon warned Congress in a 118-page report of the companies’ potential for a catastrophic failure that could jeopardize the economy.

Okay.  Five years before the crash someone was taking notice.  And he warned Congress.  Thank god someone was looking out for America’s best interests.

But Frank and other Democrats still opposed tighter regulation, Frank most notably in his public statements saying there was nothing wrong with Fannie and Freddie. He and other House Democrats also sent a letter to President George W. Bush in June 2004, saying the proposed crackdown could “weaken affordable housing performance . . . by emphasizing only safety and soundness.’’

Frank and the Democrats were saying that it was more important to put people who couldn’t afford houses into houses than it was to provide oversight.

So he initially supported a Republican measure in 2005 that would have imposed stricter standards on the lenders. But he voted against it in the full chamber because it did not include funding for affordable housing, he said. The bill passed the House.

Frank came around.  He supported a Republican measure to provide stricter oversight.  But he changed his mind.  Once again, affordable housing was more important than the oversight he was supposed to provide.  Then, in the summer of 2008, Treasury Secretary Henry Paulson warned Frank again.  Now Frank chaired the House’s Financial Services Committee.  Now, more than ever, it was his responsibility to reign in Freddie and Fannie.  To provide the oversight that was his committee’s responsibility.  But he still didn’t.  Like Nero, he fiddled as the crisis burned out of control.

In July 2008, then-Treasury Secretary Henry Paulson called Frank and told him the government would need to spend “billions of taxpayer dollars to backstop the institutions from catastrophic failure,’’ according to Paulson’s recent book. Frank, despite that conversation, appeared on national television two days later and said the companies were “fundamentally sound, not in danger of going under.’’

A few months later, Freddie and Fannie would cause the worst recession since the Great Depression.  On Frank’s watch.  And he kept denying that there was any problem until the very end.

Lots of Blame to Go Around – On the Left Side of the Aisle

Barney Frank is not the sole cause of the subprime mortgage crisis.  He was just one of the leading players.  Ultimately, it was an ideology.  Affordable housing.  Putting people into houses who couldn’t afford to buy houses.  This is what caused the worst recession since the Great Depression.  And, yes, the Bush administration did partake in the affordable housing mania.  But if you want to assign real responsibility, ask yourself this question.  Which party do you think of when it comes to affordable housing for the poor and minorities?

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LESSONS LEARNED #29: “The problem with doing what is best for the common good is that few can agree on what the common good is.” -Old Pithy

Posted by PITHOCRATES - September 2nd, 2010

COYOTE UGLY

We’ve all heard the joke.  What’s coyote ugly?  That’s when you wake up with an extremely ugly person in bed lying on your arm.  After a night of heavy drinking.  You’re fairly certain you had sex.  You’re not 100% sure because you can’t remember anything.  But here the two of you are.  Naked.  The circumstantial evidence is pretty damning.  You want to get out.  Fast.  Instead of waking your lover, you chew your arm off so you can slip away quietly.  Like a coyote will do if caught in a steel-jaw trap.

The lesson here is, of course, to drink in moderation.  For when we drink to excess, we sometimes do things we wouldn’t normally do sober.  But we do.  Drink to excess.  And get drunk.  And, boy, when we do, some of us really do.  Make a real mess of their lives, too.  You see, drunken husbands do not make happy wives.  Or good fathers.  Especially when drunken husbands beat up their wives, spend their paychecks at the corner saloon, have sex with prostitutes and catch syphilis (which they then pass on to their wives and soon to be born children). 

For these reasons, wives have been behind various temperance movements throughout history.  And they have had modest success.  If you ever found yourself in a dry county thirsting for an adult beverage, you can thank these ladies.  But Prohibition?  That’s a different story.  That took Big Government.  The Progressives.  Who thought they knew best what was for the common good.

DO AS I SAY, NOT AS I DO

Wives have suffered unfairly from the affects of alcohol.  But during the 19th century, their power was limited.  They had to rely on grass-roots movements.  And their churches.  Which had moral authority as we were much more religious back then.  Most drunken husbands knew they were behaving poorly.  When sober.  But things changed in the 20th century.  The powers of the government grew.  This power and new sciences (like eugenics) made some believe they could make a better society by passing enlightened laws.  (And make better people in the case of eugenics).

We call it social engineering.  Using the power of the state to change human behavior.  Well, change it for those who are not apparatchiks of the state.  The elite Progressives, including the ladies of high society, still drank.  For it wasn’t illegal to drink adult beverages.  Only to manufacture, sell, or transport them.  So it was the poorer elements of society who felt the impact of Prohibition.  And the immigrants.  Who the social elites blamed for all the drinking woes.  For people in their strata of society didn’t have drinking problems.  So there was no reason to punish them.  The elites.  They weren’t the problem.  It was the poor.  And the immigrants.  They’re the ones government needed to keep from drinking themselves to ruin.

So while the elites still enjoyed their intoxicating beverages in the safety of their mansions and clubs, Al Capone and other bootleggers fought for turf.  For control of the illegal liquor trade.  Shooting each other with Thompson Machine Guns in our public streets.  That’s a .45 caliber round.  It makes big holes.  And shatters bone.  A lot of these rounds were flying through our public streets.  And they hit more than just gangsters.

Prohibition modified some behavior.  But at great cost.  Congress repealed it in 1933.  In part to stem the liquor violence.  And part because the Great Depression was too depressing sober.

JUST SAY NO

I once worked at a small office in a bad part of town.  One day a woman knocked on the door.  She asked if that ‘short guy’ that opens the gates in the morning was around.  I said no.  Then she asked me if I wanted to have a little fun.  I said, “Thank you, but no.”  My secretary had come to the door while I was talking to her.  After I closed the door, she told me that woman just lost a lot of weight.  And that she probably had AIDS.

Women like her were common in the neighborhood.  They sold sex for drug money.  When they weren’t with a John they were getting high.  Men, too.  One time, this 6-foot-plus behemoth in a skirt was walking in the street shouting something incoherent.  Our driver discovered he was a guy.  When he lunged through his open window while turning at the corner.  I don’t know what scared him more.  The assault.  Or the fact that she was a he. 

By the way, that short guy that opens the gates?  He was married.  And had a couple of daughters.  God only knows what he gave his wife.

Drug addiction is not good.  No one’s life ever got better by being addicted to drugs.  None of these people ever planned on drug addiction.  It just happened.  Somehow.  One day you’re just partying with some friends.  Then the next thing you know you’re turning tricks or stealing to support your habit.  If you have money it’s a different story.  Then you can party until you kill yourself.  John Belushi overdosed from a heroin/cocaine cocktail called a speedball.  Chris Farley, too.  It’s unlikely that the speedball was their first high.  They probably started out with something less potent.  Like marijuana.  The entry drug of choice.  Only when that drug loses its charm do people step up to something a little more potent. 

Of course, if you don’t start, chances are you won’t move up to something more potent.  This was the idea behind Nancy Reagan’s anti-drug program.  Stop the kids from starting.  To resist peer pressure.  To just say no.  Her program did modify some behavior.  Kids did use fewer drugs.  But she was Ronald Reagan’s wife.  The Left didn’t like him.  Or her.  So they ridiculed her program as being simplistic.  Discontinued it.  And drug use by kids increased.

GANGSTA’S PARADISE

Like Capone and his fellow bootleggers, the illegal drug trade is controlled by gangs.  And they, too, fight over turf.  But those involved at the street level of the drug trade today are a lot younger.  During the days of Prohibition, kids played with toy guns.  Today, they’re playing with real guns.  Not so much playing but killing each other.  And innocent bystanders.  In drive-by shootings.  Why?  Because drugs get you money.  And money gets you power.  Put all that together and it’s very seductive to kids from broken homes in the hood.  Who have nothing.  And have nothing to lose.  It’s almost romantic.  Fighting.  And dying.  A regular gangster.  Living in a gangster paradise.

Once in, though, it’s hard to get out.  The song Gangsta’s Paradise (by Coolio featuring L.V. from the 1995 Movie Dangerous Minds) laments about that paradise.  “Tell me why are we so blind to see.  That the ones we hurt are you and me.”

You get higher up in the echelon and the violence gets worse.  You can see that on America’s southern border.  And further south.  Kidnappings.  Beheadings.  And other unspeakable things.  Because of the big money in illegal drugs.  Like there was in bootlegging.  Make something illegal that people still want and will buy, and that something becomes a very profitable commodity indeed.

DAMNED IF YOU DO, DAMNED IF YOU DON’T

So what’s the answer?  What is the best course of action for the common good?  We can keep drugs illegal.  And continue to fight the war on drugs.  And watch the violence escalate as people fight to control this illicit trade.  Or we can decriminalize drugs.  Make them easily accessible.  And cheap.  The drug gangs would go the way of the bootlegger gangs.  And the crack/meth whore in the street won’t have to perform as many sexual acts to support her habit.

Alcohol is legal today.  And there are a lot of social costs because of that.  But the majority of people who do drink are not driving under the influence or beating their wives.  Or getting syphilis from a prostitute hanging out at the corner saloon.  Wouldn’t it be the same for drugs?

Kids drink.  Even though they can’t legally buy alcohol.  But the worse thing they can do is kill someone while driving a car.  Or get killed in a car driven by another drunken kid.  Or kill themselves from binge drinking.  Or get pregnant because they got drunk at a party.  Or get infected with a venereal disease because they got drunk at a party and had sex.  These are very bad things.  But they’re not an addiction.  Sure, you can become an alcoholic, but a lot of kids don’t like the taste of the adult beverages they’re consuming.  They’re just doing it for the party buzz.  And vomiting after.  It takes awhile, for some, to get over that hump where those awful tasting beverages don’t taste so awful anymore.  But drugs?  They’re tasteless.  There isn’t a delivery system ‘hump’ to get over.  Which makes the addiction process that much easier.  And where there is only one kind of drunk, there are all sorts of highs.  New and different drugs to explore.  When you get bored with the drug du jour.  So, no.  It probably wouldn’t be the same with alcohol.  It would probably be worse.

THE LESSER OF EVILS

Often the choice comes down to a lesser of evils.  So, to do what is best for the common good, we just need to determine which is the lesser evil.  So which is worse?  The violence from trying to keep something illegal?  Or the social costs of decriminalizing something that is already causing a lot of harm while being illegal?  It comes down to what you, as an individual, think.  And that is, must be, a subjective decision.  And therein lays the problem of choosing what is best for the common good.  It’s an opinion.  Choices aren’t right or wrong.  There’re just different opinions.

And that’s why so few can agree on what is best for the common good.  Different people think different things are better.  And different things are worse.  And, at best, they can agree to disagree.

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