Thursday, October 29, 2009

The Political Ramifications of Obama Care

The Obama White House push for an omnibus health care bill is really surprising in light of its likely political impact. Once enacted, there are few Americans that won't feel dramatic cost increases and substantial reductions in health care provision. Within the next twelve months, most American families' health care costs will rise more than thirty percent thanks to Obamacare and within twelve months, they will know it. What happens in twelve months? The 2010 Congressional elections -- that's what.

Republicans should vote for cloture and then vote against Obamacare. That way they can insure its passage. It is a free pass for the Republican Party for a generation. Virtually no American will feel better about their health care than before Obamacare. Those on Medicare will be especially aggrieved since over $ 50 billion per year of their current care is eliminated in all versions of Obamacare. The over 65 population is the single fastest growing demographic in the American population, which will become solidly Republican for years to come.

How about the young? The burden of cost is shifted to the young in this bill. The young have only slight need for health care insurance, but they will pay mightily under Obamacare. Their romantic illusions of life under Obama will be shattered by the realities of Obamacare.

There simply are no winners, except Republican politicians who will not likely be in any big hurry to roll Obamacare back. Better it stay in place as a reminder of what happens when government takes over a large sector of the economy. Too bad if you need health care.

At least with "card check," the unions are happy. No one will be happy with Obamacare. It may as well be retitled the "Republican Congressional Full Employment Act"

Wednesday, October 28, 2009

Another Dumb Idea Courtesy of Barney Frank

Barney has decided that financial service firms should contribute to a fund that would then be available to "bail out" firms that go belly up. Great!

Imagine that, in your neighborhood, everyone was required to contribute to a fund in case any of your neighbors couldn't pay their bills. This shifts the responsibility away from the decision makers. Folks could easily run up big bills without difficulty. Why not? If I know there is a fund available in case Joe Smith can't pay, then I will lend Joe Smith unlimited amounts of money (so long as the fund is unlimited). And Joe? He will gladly borrow to the hilt, since the rates he pays reflect the fund that stands behind him, not his own profligacy.

So, what happens. Barney's bill will encourage financial service companies to take much greater risks than they have in the past and the market will provide these companies with the wherewithal to take these risks, since there is a fund hiding behind the scenes to absorb the losses. Of course, in reality, since so much risk will be taken, the taxpayer will ultimately bear the brunt of the losses in Barney's "too big to fail" world.

Better would be simply to let those who take the risk bear the brunt of the losses. Let the profligate go "poof" and leave the poor taxpayer alone. And, stop providing incentives for lenders to lend to those taking the most risk, which is exactly what Barney's fund would do.

Barney and Chris are in a race to see who has the dumbest ideas. I would say that Barney now has a slender lead. But, Chris is still in the running.

NY Times Leonhardt on Target

I don't often get the opportunity to praise an economics article in the NY Times, but this morning's NY Times has a sterling piece by David Leonhardt. He tackles the Obama proposal to give America's senior citizens $ 250 apiece to make up for the absence of a cost of living index increase in social security payments this coming year.

Obama's idea is strange on two counts: 1) The cost of living index increases were supposed to offset inflation. If there is no inflation (and there is none), why does Obama think seniors need the $ 250? Is he just being generous (profligate?) with our unborn grandchildren's money? 2) Senior citizens are the demographic least effected by the current economic recession. Why single them out for special treatment? Leonhardt makes these points effectively in his probing article.

The answer of course is that Obama is in trouble with seniors because his health care reform promises to make major cuts in the actual provision of health care for senior citizens currently on medicare. They know that and he knows that. So, this is Obama's effort to buy them off. Once again, "change you can believe in." There is a pattern here.

Tuesday, October 27, 2009

Dodd Takes Us Back in Time

Chris Dodd holds the record for the most ridiculous Congressional proposals in modern time. He is working hard to hang on to that record (Barbara Boxer is closing in fast).

Dodd's latest is a proposal to "freeze" credit card interest rates. There's a great idea. That was the way the world used to work -- "usury" laws. The idea is that some rates are just plain unfair. Heck, in the Islamic world, all rates are unfair. They ban interest on loans. Islamic banking manages to get around that in practice by redefining what is meant by a loan.

So, what is Dodd up to? His idea is that by capping interest rates, borrowers will be better off and those stingy old lenders will not be able to "rip off" the borrowers. But, what if the stingy old lenders behave rationally. What will they do?

They will quit offering loans to all but the best credit borrowers -- rich people. Middle income and lower income folks need not apply. They will lose access to credit or worse, be forced to deal with unsavory illegal lenders.

When you pass a "maximum price" law what you are doing is telling a willing buyer and a willing seller: "Sorry, government knows better." You prohibit the transaction. This doesn't mean the buyer gets a lower price. What it means is that the transaction does not place. (Hint: that's why minimum wage laws create unemployment...such laws prohibit a transaction between a willing buyer and a willing seller).

That is what will happen in Dodd's brave new world. If borrowers can't charge the interest rates they need to take the risk of lending to middle income Americans, then they won't lend to middle income Americans.

Thanks to Chris Dodd, the plight of American middle income families could become worse than it is already.

Monday, October 26, 2009

Krugman Says Health Reform "Will Work"

Once again, Paul Krugman has ventured forth in the health care reform debate (in today's NYTimes). Krugman begins with the premise that medicare works. Wonder why he thinks that? He, like Michael Moore, thinks Medicare is great. He and Moore are not old enough for Medicare so they have no idea what it is like. Furthermore, they will never really be subject to Medicare as their wealth will buy them whatever health care they want (even if they have to fly to India to get it). Rich people won't be restricted to Medicare so they think it's great. It is great, if you don't have to use it.

The problem is that for those who are eligible for Medicare, it is a complete nightmare. To begin with, just getting enrolled can be quite a project. It took me ten months to get enrolled in medicare after I became age-eligible. Thank goodness I didn't need it. (It is really a great system if you don't use it). I am covered by a policy covering University of Virginia employees. So, like Krugman and Moore, I don't really need it either. But, I have great familiarity with medicare as both my mother and sister are enrolled in medicare. Let me assure you that medicare is a nightmare to use and many things are not covered by medicare (and medicare supplemental packages) that are routinely covered by ordinary health insurance that one can buy over the counter (before Obamacare outlaws such insurance policies).

Of the 50 million Americans without health insurance, eleven million are currently eligible for free medical care under medicaid. Guess why they don't enroll? They can't figure out how to enroll. It is an absurdly complicated system and it takes social security the better part of a year to even consider an application, assuming you have the persistence to go through the mind-boggling application process. (Wonder why Nancy Pelosi and Max Baucus don't worry about the fact that eleven million eligible citizens don't bother to sign up for does a new program with new, more complicated, signup procedures help this group?).

As is widely known medicare is not only a poor payer for medical services, it is enormously over budget and, combined with medicaid, will run out of money in a very few years. Then what? The great system that Krugman and Moore like, but will never use, will simply quit paying for much of anything once the money runs out.

What a brave new world! Everyone will have health insurance but no one will get medical care and the costs of this absence of provision will be astronomical. (This is similar to what has happened to our educational system -- astronomical costs (highest in the world) and very little education actually provided)

Maybe Krugman should spend some time with folks that are currently on medicare and medicaid and then he might learn that medicare is a complete mess and bankrupt to boot. Is this what he things the rest of the country needs? Is this what will work?

It is not an accident that the vast majority of folks now on medicare are protesting the Obamacare proposals. They know what a disaster this will be. They are already experiencing it.

Saturday, October 24, 2009

Crunch Time

Attempting to meld together the impossible, Senator Harry Reid and House Speaker Nancy Pelosi are trying to bring a "compromise" "health care reform" package before the Congress. Given the enormous differences between House and Senate, this is no small task.

The bottom line is cost. The Democrats don't mind eliminating choice from health care. After all, that's pretty much what medicare and medicaid are all about. That doesn't bother them. They don't mind blowing away the free market either. After all, that is what the GM and Chrysler (and other) bailouts, the Pay Czarr, etc., are all about. The problem for the Democrats is simply one of cost. The US fiscal situation is completely out of control and the passage of the Obama health care plan (any version) simply nails the coffin shut. It is hard to see how the US avoids bankruptcy as a nation, if this bill passes and is signed into law.

That is the heart of the Democrats problem. Why does cost matter when it never mattered before? Because this time, something will have to be done if the country is to survive. There is no alternative but ridiculously high taxes (and even that won't work), absurdly high inflation (which will only work for a little while), and massive cuts in actual health care provision. Everyone will eventually be insured, they just won't get any medical care.

More and more Americans and more and more Democrats can see clearly where this is headed.

Senator Reid and Speaker Pelosi are in a pickle, but the real loser (besides the American public) is Obama. Obama is in big trouble if this passes. His presidency will never recover because the public will feel the damage that this "reform" produces very quickly. Certainly in time for the next election.

Wednesday, October 21, 2009

Volcker Stands Alone

Paul Volcker is a great American. Appointed by Jimmy Carter to be the Federal Reserve Chairman in 1979, he served two four year terms ending in 1987 (succeeded by Alan Greenspan). Volcker broke the back of the great inflation of the 1970s (which peaked at 14 percent in August of 1979) and ushered in (helped by Reagan's tax cuts) the greatest wealth increase in a single country in human history. Today's Dow Jones average of 10,000 seems a long, long way from the August 1981 reading of 780. The 1980s and 1990s were great years for the United States and Paul Volcker is one of the folks to thank for those great years.

These days Volcker is an economic adviser to Barrack Obama, who listens to no one, apparently. Obama certainly does not listen to Volcker. Volcker is calling for the breakup of the very largest commercial banks and a return to Glass-Stegall (which would divorce commercial banking from investment banking). Volcker does not like the "too big to fail" concept and would prefer to eliminate "bigness" rather than over-regulate the financial sector. Obama prefers massive new regulation, which will simply shift financial leadership to Asia and relegate the US to the financial backwaters of the modern world. Volcker sees the problem.

While not in agreement with Volcker's recommendations, I have to admit my admiration for this great man and his ability to point to the real issues. No one else in the Obama White House seems to believe in anything but bigger government, higher taxes, and an endorsement of a permanently stagnant US economy. Three cheers for Paul Volcker.

Monday, October 19, 2009

The New Obama Tax System

Monday's Wall Street Journal contained a terrific opinion piece pointing out the new marginal tax rates that American workers will face when Obamacare is passed into law. For those between the poverty line and twice the poverty line the marginal rates will approach 70 percent of income. The effective marginal rates for taxpayers with income under $ 60,000 per year from the health care bill alone are generally between 20 and 35 percent for most working Americans and 70 percent or more for lower income Americans. These new marginal tax rates are in addition to the existing tax structure and represent a new and burdensome slamdown on the American middle class.

The reason for these huge marginal tax rates is that subsidies are provided in the bills to offset the dramatically higher health care premiums that everyone will face under Obamacare, but these subsidies are drastically reduced as your income rises. So, you will pay huge amounts at the margin for your health care if your income rises.

This doesn't bother Obama because he doesn't think incomes will rise given his other economic policies. He might be right about that. There certainly won't be much incentive for workers to push for higher incomes or take any steps to improve their income after Obama gets done.

Saturday, October 17, 2009

The "Good Idea" Syndrome

There is no shortage of "good ideas" that can be translated into legislation. Years later these good ideas become the present day nightmares. A great example of this is the tax free status of employer provided health care insurance. This tax gimmick was inserted into law back in the days when the free market reigned in health care and,in its early years, it did not do much damage.

As time passed having a tax free benefit in health care created an arbitrage for employers. They could provide a benefit to employees that, unlike ordinary wage and salary income, would be tax free to the employee, even though the employer received the full tax benefit as if the health care benefit were simply part of ordinary wage and salary expense. As a result of this arbitrage, employers provided "comprehensive" health care plans, not "catastrophic" health care plans. If employees paid for their own health insurance (if it were not a tax free benefit provided by employers), employees would no doubt choose a catastrophic plan just as they do with auto insurance, home insurance, life insurance and all other forms of insurance that average citizens routinely purchase.

As a result of employers choosing "comprehensive" health insurance, the result is what you would expect if auto insurance were comprehensive and paid for routine oil and gas bills and tire changes -- massive and unbounded cost increases. And, of course, that is exactly what happened. Perfectly surprises here.

As if that wasn't enough to push health care cost increases to astronomic levels, the Congress went further. In the mid 1960s, the Congress passed the Medicareprogram into law. After the dramatic expansion of Medicare that occurred in the mid-1970s, it then became a fact that most Americans who use health care do not pay for it directly. They pay for it and then are reimbursed or they are reimbursed at the point of purchase.

Anytime you don't think you are paying for something, then you don't much care what it costs and that is precisely what happened to health care.

Nothing will stop the escalating and skyrocketing health care costs as long as the free market is basically outlawed by Congress, as it is with Medicare and tax-free Employer provided health insurance.

So, in essence, the Obama plan is to take the current disastrous health care payment system and extend it to everyone. Once Obamacare is in place, it obviously will bankrupt the nation if it works as proposed. So, the Obama folks and their successors will begin the process of eliminating health care procedures they don't like and promote the ones they like. They will also dictate, as a matter of law, who gets what treatment and who doesn't and when and where and by whom.

Free choice in health care will become a thing of the past.

The quality will collapse because the kind of folks that have historically gone to medical school to become doctors will abandon that pursuit and find some other, less bureaucratic profession. Being a doctor in the future will be a detested profession of low esteem. It won't pay much either.

All of this because of what seemed like two "good ideas:" tax-free employer provided health care and medicare.

Just abolishing tax-free employer provided health care and medicare (for future, not current, recipients) would solve the problem of rising health care costs and let Americans decide for themselves how to deal with their health care needs, instead of almighty government. The problems that we have now would simply disappear.

Unfortunately, such an outcome is not now in the cards thanks to Obama and his cohorts.

Beware of Congressionally mandated "good ideas." They inevitably become the nightmares of the future and are extremely difficult to reverse.

Thursday, October 15, 2009

The Quote of the The Year

"We're going to continue to explore each and every avenue that I can think of that will lead to job creation and economic growth."

This from President Obama today while touring a make-work project in Springfield, Virginia funded by the infamous stimulus bill.

The good news is that the President has finally acknowledged that unemployment is a problem. Now we need to get the President to the next level of recognition. Who is it that hires people?

Here's a hint for the President: making employees much more expensive to hire and raising business taxes to extraordinary high levels probably is not the ticket.

More Politics as Usual

Obama is in deep trouble with seniors over his proposed health care reforms. Seniors see clearly that the $ 500 billing "savings" from Medicare over the next few years will come out of their hides. So, they are mad at Obama.

How to make up? Obama has now proposed spending (wasting?) $ 250 per person in additional spending next year (as if we don't spend (waste?) enough). The proposal includes other groups as well. Without doubt, Obama thinks this will make seniors (and others) change their mind about Obamacare. It won't.

Like all of the rest of the Obama proposals, the $ 250 per person giveaway, takes income and wealth away from unborn American citizens. They can't vote, so he socks it to them.

Politics as usual. More "Change we can believe in" I suppose.

Tuesday, October 13, 2009

The Problem for the Dollar

Since World War II, the dollar has been the reserve currency of the world. As such, global products like oil were priced in dollars. Central banks held large dollar reserves as a natural part of their facilitation of international trade. Why is everyone now talking of abandoning the dollar as the world's reserve currency?

The answer is very simple. Holding dollar reserves means holding a dollar-denominated asset. (No one holds dollars themselves...that would be silly). Up to now, holding treasury bills was the preferred method of holding dollar reserves. Increasingly, other countries no longer trust the security of US Treasury bills. That is the problem. Not the dollar per se, but how do you hold dollar reserves safely.

Maybe the Chinese will solve this problem for us. They could issue Chinese government bonds denominated in dollars. Then central banks around the world would hold Chinese government debt and the dollar could remain the reserve currency of the world. But as long as treasuries are the main instrument for holding dollar reserves, look for the world to abandon the dollar as the reserve currency.

This will be part of the Obama legacy...a legacy well earned.

Sunday, October 11, 2009

The Rally is Over for Now

2009, so far, has been a great year for stocks. The first two months of the year certainly didn't look that way as the Dow collapsed to the 6400 level by the 9th of March. But, since then, it has been nothing but straight up. My guess is that this rally is basically over.

The headwinds are enormous. Where to begin?

The US national debt is spiraling out of control. The debt situation is far, far worse than is being reported because of: 1) consistent underestimation of future spending; 2) consistent overestimation of future economic growth and future tax revenues; and 3) the staggering amount of "off balance sheet" obligations of the US government. The Congress and the Administration have consistently favored legislation that adds to the national debt and resist any effort to slow its growth.

The war on lower income Americans by the President and the Congress implies high and persistent unemployment levels, a lack of credit availability, and a growing dependence on government as opposed to the private sector. Things like a nearly 40 percent increase in the minimum wage in just a few years mean fewer jobs for low income Americans. Remember that the minimum wage law does not say: you must hire this person and pay them a minimum wage...that is not what it says. What the minimum wage law says is: if you would like to hire someone (or be hired by someone) at less than $ X per hour, you are a criminal. Minimum wage laws outlaw contracts desired by both parties! You and your employer's views don't matter in this equation...only the government's views matter. Most people who support this kind of legislation will never be subject to it -- unions, highly educated folks, rich left wingers...they love this stuff, because it doesn't extract any penalty from them. Only the poor and low income suffer from this type of legislation.

Some version of the Obama "health care reform" legislation will be passed by this Congress and signed into law. That "reform" will add trillions of dollars to the already staggering national debt (for reasons cited above). It will also add layers and layers of government bureacracy to the health care system and, ultimately, abolish free choice and free markets from our health care system. There will be a decline in the quality and quantity of our medical personnel (a trend that is already in place) and America's health care system will eventually rank side by side with its public education system -- among the worst in the civilized world. Meanwhile, plaintiff lawsuits will abound with taxpayers more and more the target of the John Edwards crowd, since the government will more and more become our health care provider.

"Cap and trade" will pass in some form and will deal another body blow to the US's economic future. A new law that does nothing to lower global carbon emissions will bring crippling increases in the electricity bills for all American households and businesses. This act of economic suicide will be cheered by Europeans and others who despise the historic strength of the American economy. But, it will be another body blow to the average American trying to dig out of the current malaise.

The new regulatory regime will have the effect of shifting global capital market primacy away from the US and to other countries. New York will loses its prime position (that trend is already under way...the Obama policies will simply accelerate that trend). Lending markets will become much, much more restrictive under the new regulatory regime and financial innovation will be effectively outlawed in the US. Shanghai and Hong Kong will be the beneficiaries. The Asian economies will not adopt these self inflicted wounds that would prevent their capital markets from flourishing. The Asian economies will flourish.

Where to invest?

Here is what I would guess:

1) Bet against the dollar and against the US treasury market

2) Buy US real estate. The reason this works is that America will become more and more like Europe. Business innovation will shift to Eastern Europe and Asia and America will become a stagnant land of folks spending their time trying to divide up a never growing economic pie. Stagnant assets do well in that environment. The US will become cheap compared to the rest of the world as the American dollar collapses. It won't take too many yuan to buy the average American house in a few short years.

3) Buy a diversified portfolio of global stocks and bonds with the heaviest weights in Eastern Europe and Asia. Underweight the US and Western Europe. They are going nowhere fast and are preoccupied with programs that devastate economic growth.

The world is changing and economic strength is shifting. The US and Western Europe are digging their own economic graves. That may not be so bad though. Perhaps it is time the rest of the world got a shot at economic prosperity. My guess is that Asia is most likely to fill the void that the US is rapidly creating.

Saturday, October 10, 2009

Obama Continues the War on Lower Income Americans

Earlier this year, President Obama proposed and Congress dutifully passed a bill that "prevented credit card companies from deceptive practices." These so-called "deceptive practices" were, of course, clearly spelled out in every single document that the "duped" customers were required to sign. No matter.

Now, such practices as raising rates on variable rate credit card loans are simply prohibited by law. What is the practical impact of this nonsense? It is a return to the discredited "usury" laws of the eighteenth century. By denying credit card issuers the right to contract lawfully with their customers, you force the credit card issuers to simply quit dealing with low income borrowers. And that is precisely what they are doing.

As is well known and has been thoroughly documented, credit card issuers are eliminating credit card access to their lower income users and denying new credit cards to this same group as a response to the Obama legislation. Exactly when lower income Americans need credit help, the Obama Adminstration and the Congress have taken positive steps to make certain that lower income Americans will once again have to turn to loan sharks and illegal markets to obtain much needed credit.

As if this blow to lower income Americans wasn't sufficient, the Obama Administration is now pushing a new plan to deny lower income Americans access to the mortgage market and the consumer bank credit market. The new so-called "financial regulation" bill would prohibit "predatory" practices. The main import of these provisions will be to eliminate most of the bank lending to small businesses and to lower income households.

This is more of the "reverse Robin Hood" strategy of the Obama Admistration. My guess is that this is meant perversely to offset the redistribution schemes in the Obama stimulus bill. Lower income folks will only be effected if they need credit or a mortgage loan. Otherwise they will be fine.

The war on low income Americans continues. Wonder what's next?

Friday, October 9, 2009

Decline in Job Openings -- Does it Matter to the Administration?

More data for the Obama Administration to chew on: August job openings, reported in today's Wall Street Journal, were down again. Job openings reached the lowest level since the Labor Department began tracking such data in December of 2000.

So, the beat goes on: higher unemployment every month accompanied by fewer job openings every month. Is the White House paying attention?

It is becoming increasingly hard to fathom why every program proposed by this Administration makes employees more expensive and reduces the incentives for business to hire anyone. It's interesting that the parts of the world that are climbing out of this recession - parts of Eastern Europe and virtually all of Asia -- do not have such silly policies. Why are we adopting them?

Is unemployment an irrelevant sideshow for the Obama Administration?

I am sure that the growing economic malaise in the United States is popular with Europeans. So, Obama is riding high with Europeans. But, unless this Administration turns on a dime, which isn't likely, America will live with double digit unemployment throughout Obama's first (and hopefully last) term. This is not a "Bush problem," this is an Obama problem.

Strangely, I don't think Obama really minds high unemployment. He certainly isn't proposing anything to deal with it. Quite the contrary.

Saturday, October 3, 2009

Lets Hear It for the New York Times

On today's editorial page, the NY Times headline reads: "Wanted: Leadership on Jobs." In a well written editorial the Times says that "Congress and the administration have not done enough...don't pretend that the deteriorating jobs picture will self-correct, or act as if it is tolerable." Amen

Reich on Unemployment

You gotta love Robert Reich, former Clinton advisor. This guy is definitely his own man. His latest pitch is that the government needs to tackle the unemployment problem. No question, Robert has figured out the country's great national problem. It isn't health care, it isn't climate change, it isn't a lack of unionization, it isn't the locale of the next's unemployment. That is the problem. Now inching toward ten percent with growing evidence that businesses just don't seem to want to hire anybody. Surprise, surprise.

Reich says that we need another WPA (Work Projects Administration) like the one we had in the 1930s to build roads, parks, bridges, and put people to work doing these things. Where were you last February, Robert? We could have used you. The so-called stimulus was supposed to be "infrastructure" projects just like you suggest. But, as Reich knows, Obama abandoned infrastructure in favor of redistribution of income. So, the vast bulk of the $ 800 billion stimulus became non-stimulus pork.

But Robert Reich is right about one thing. Our number one national problem is unemployment. The Administration has chosen to ignore the problem and focus attention everywhere else. But, this problem won't go away. The Obama economic policies imply perpetual high levels of unemployment. The Obama policy of making employees more expensive to employers is the wrong policy.

Friday, October 2, 2009

Meanwhile Back in the USA

You have to wonder why the Obamas and Oprah Winfrey thought they could win in Copenhagen. At stake -- the site of the next Olympic games. In a contest between four cities, Chicago finished dead last. The Obamas' and Oprah's magic did not seem to do the trick. In fact, it had been rumored before the Obama-Oprah act, that the US was in second place, just behind Rio (the eventual winner). But, lo and behold, Madrid and even Tokyo bested the US. If you read the Obama presentation carefully, there wasn't much there about Chicago, other than it's relationship to the Obama family. Perhaps hearing about the Obama family just wasn't enough to put the city of Chicago (whose other traits went largely unmentioned by the Obamas) over the top.

Meanwhile, the unemployment rate in the US, predicted by the Obama Administration to go no higher than 8.0 percent at the time of the signing of the infamous stimulus package, inched ever closer to the double digit mark. The reading was 9.8 percent -- the highest unemployment rate since 1983. So much for the job creation effectiveness of the $ 800 billion Obama stimulus plan. Economists are revising their unemployment predictions upward and their economic growth forecasts downward. It's not surprising that the Obamas preferred to be out of the country.

The only good news is that the Obama Administration is no longer talking of a second stimulus plan. What the economy needs is for the Obamas to get back on Air Force One and go back to Copenhagen and stay there for a few weeks. Let the health care bills and card check and cap-and-trade die a quiet unmolested death and give the economy a chance. It's only a dream, but sometimes you have to dream.

Cash for Clunkers .... Thud!

As expected, as soon as the "cash for clunkers" program lapsed, auto sales plummeted. September sales for GM fell 36 percent, Ford sales fell 37 percent and Chrysler sales dropped 33 percent. The September collapse in auto sales offset the sales generated by the cash for clunkers but unfortunately will not offset the hit to taxpayers of this foolish program.

The national debt is now higher because of the cash for clunkers program. The economy is no better off and car sales are about where they would have been before this waste of taxpayer money. Another lesson that never seems to get learned.