Thursday, March 4, 2010
Put a Lawyer in Charge -- More on the Obama Way
Elizabeth Warren is now the guru about how Wall Street should operate. Her background? Economics? Finance? No...she is a lawyer. Her knowledge of Wall Street is zip. Now she will decide our future. Instead of letting Citigroup decide its future, it is now up to lawyers like Elizabeth Warren. No point in letting any economists or financial experts opine on this. Warren is another arrogant Obama appointment. In case you are wondering, Warren is the head of the, ironically named, "Oversight Committee" that now runs the US financial services industry. So much for capitalism and the free market. Now lawyers run the show.
Wednesday, March 3, 2010
Once More With Feeling
He just can't leave the insurance companies alone, can he. Dig this quote:
"Now is the time to make a decision about how to finally reform health care so that it works, not just for the insurance companies, but for America's families and businesses."
You wouldn't know from that comment that 85 percent of Americans have health insurance and something like 90 percent of those 85 percent are satisfied with their current health insurance. Who is the current system not working for? What other industry has satisfaction rates like that? Certainly the White House polling numbers are nowhere near that.
As for insurance companies, they have one of the worst profit rates in the American economy. Why does Obama think they are making so much money? Does he know anything about this subject? If so, why are his statements almost always incorrect when he discusses this subject? Does he care about the real facts?
Every day there are more and more inane quotes from the President revealing how out of touch this White House is with the real issues of our time. Has the President noticed the unemployed or the tripling of the deficit since he took office? When he is going to get off the health care kick and begin to notice the real problems of the American economy.
The only consolation from the rhetoric coming out of this White House is that voters will have a chance, finally, in November to have their say. Voters tried to get their point across in Virginia, New Jersey and Massachusetts, but the President, so far, isn't listening. Can't wait for November!
"Now is the time to make a decision about how to finally reform health care so that it works, not just for the insurance companies, but for America's families and businesses."
You wouldn't know from that comment that 85 percent of Americans have health insurance and something like 90 percent of those 85 percent are satisfied with their current health insurance. Who is the current system not working for? What other industry has satisfaction rates like that? Certainly the White House polling numbers are nowhere near that.
As for insurance companies, they have one of the worst profit rates in the American economy. Why does Obama think they are making so much money? Does he know anything about this subject? If so, why are his statements almost always incorrect when he discusses this subject? Does he care about the real facts?
Every day there are more and more inane quotes from the President revealing how out of touch this White House is with the real issues of our time. Has the President noticed the unemployed or the tripling of the deficit since he took office? When he is going to get off the health care kick and begin to notice the real problems of the American economy.
The only consolation from the rhetoric coming out of this White House is that voters will have a chance, finally, in November to have their say. Voters tried to get their point across in Virginia, New Jersey and Massachusetts, but the President, so far, isn't listening. Can't wait for November!
Blame It on Goldman
As Greece and the Euro begin their long slide into fiscal bankruptcy, all eyes turn to Goldman. Even Bernanke can't resist. As Greece doubled the pay of its public employees in the last few years and dramatically increased its retirement and health care benefits, the fiscal deficit moved to nearly 14 percent of GDP. It turns out, this is all Goldman's fault. Yes!
Here's how. In 2001, Goldman arranged a $ 2.2 billion swap, which was essentially equivalent to debt financing. This amounted to 1/10th of one percent of GDP for 2001. Yes! 1/10 of one percent of GDP for the 2001 fiscal year. That transaction, according to Ben Bernanke and the Greek government is the villain. Gee, if Goldman hadn't done that, all would be well in Greece.
Sound familiar? This was the excuse given for the housing bubble -- the evil lender! Never at fault is the borrower, who takes the money, indulge themselves and then fail to pay back the money. The borrower is always innocent in these scenarios. It is the always the evil lender. As for the borrower, "the devil made them do it."
Poor Greece, I guess they didn't understand that full retirements at 58, free health care for everyone, having over 50 percent of the labor force working (?) for the government -- those things were A-okay.
You wonder why Greece is going bankrupt. After all, Goldman hasn't arranged a swap for them since 2001. Must be some other predatory lender, that's it!
Here's how. In 2001, Goldman arranged a $ 2.2 billion swap, which was essentially equivalent to debt financing. This amounted to 1/10th of one percent of GDP for 2001. Yes! 1/10 of one percent of GDP for the 2001 fiscal year. That transaction, according to Ben Bernanke and the Greek government is the villain. Gee, if Goldman hadn't done that, all would be well in Greece.
Sound familiar? This was the excuse given for the housing bubble -- the evil lender! Never at fault is the borrower, who takes the money, indulge themselves and then fail to pay back the money. The borrower is always innocent in these scenarios. It is the always the evil lender. As for the borrower, "the devil made them do it."
Poor Greece, I guess they didn't understand that full retirements at 58, free health care for everyone, having over 50 percent of the labor force working (?) for the government -- those things were A-okay.
You wonder why Greece is going bankrupt. After all, Goldman hasn't arranged a swap for them since 2001. Must be some other predatory lender, that's it!
Tuesday, March 2, 2010
You Gotta Love It
For sheer entertainment, nothing beats Obama. Here's today's quote:
"The economy was my focus last year and that is my focus this year. This depends on not just spurring hiring but doing so in the areas that will create lasting opportunities and prosperity."
He can really turn a phrase can't he. Is he kidding?
"The economy was my focus last year and that is my focus this year. This depends on not just spurring hiring but doing so in the areas that will create lasting opportunities and prosperity."
He can really turn a phrase can't he. Is he kidding?
Political Systems Broken in the West
Western countries have always prided themselves on their "Enlightenment" tradition of representative government in contrast to the authoritarian regimes that predominate in much of the rest of the world. Now, you have to wonder whether the Western experiment can survive.
Let's begin with Greece. Greece is simply an icon for all of the rest of the European countries and the US. Greece has entitlements that it cannot afford and over half of Greece's employees work for the government. Their budget deficit is now over 13 percent of GDP and GDP is falling and the deficit is rising. Retirement age is in the 50s and tax fraud is commonplace. The tax fraud is so bad in Greece that it is suggestive that most Greeks have little or no respect for their legal institutions.
So, the Greeks spend money and indulge themselves with money that they do not have. Bondholders, outside of Greece, have been funding this nonsense for years, but are now balking at continuing to do so. Naturally, the Greek government now looks to other countries for a bailout, instead of taking steps on their own to curb the enormous stupidity that passes for social policy in Greece. Greece is a protypical European welfare state. They are a small version of the situation that exists in every single European country.
Greece, of course, is now demanding that other countries bail them out -- Germany is at the top of their list. Germany has insisted that the Greeks take steps to reign in their out-of-control, unfunded, spending habits. So, what is happening? Greece's largest government employee union is now planning a 24 hour strike. The political system in Greece is breaking down. Not willing to stop living off of other people, the Greeks are now threatening to bring down their own economy and their own political system. This is only the beginning. This political breakdown will spread to other countries in Europe and dominate the future of Europe. All of these pampered and protected groups who think they are entitled to free retirements at early ages and free health care are now finding that there is no one left to pay for all of this. There are no squirrels left that are willing to gather acorns in the Spring and Summer for the Greeks to eat in the Winter. So, now it is time to fight it out in a broken political process.
It won't matter. Simple arithmetic tells you that the Greek experiment, like the European experiment, in the welfare state will fail ultimately, for the simple reason that there is no longer any group of folks that will pay for this. This ponzi scheme has run its course, though the political posturing will go on for another decade or two. It will take some time for Europe to realize that the European welfare state model is untenable. Whether Europe will opt for another round of fascism or move toward free markets is an open question and much in doubt. But, the welfare state is entering its death throes, though the final death will take some time.
Meanwhile, the "poat-partisan" Obama Administration is planning to ram down the throats of an unwilling public, a radical restructuring of American health care that will deny coverage and choice, dramatically raise health care costs and put nearly 20 percent of the economy under direct government control. The public is overwhelmingly against this legislation. But, that doesn't matter. The arrogant Administration and their allies in Congress are determined to cram down this unpopular legislation regardless of public opposition. This Chavez-like strategy that Obama is embarked upon shows the dangers of putting an untested, inexperienced team in the White House, that has a condescending view of the average American. Obama and his crowd have nothing but contempt for the opinion of the average American and the average American knows it.
It is doubtful that Obama-Pelosi will get their way, even with their irresponsible assault upon American political institutions and the economy. But, the very effort to do so, shows that the American political system is broken as well. Never has a bill so unpopular been presented to the Congress and never has a President and his political party been so willing to slap the American people in the face. "The public be damned" is an apt description of the operating style of the Obama Administration. They simply do not care what anyone thinks. Chavez doesn't either. No wonder Obama was busily smiling and shaking Chavez's hand early in his administration. They have very similar views. Neither has much respect for free institutions.
Let's begin with Greece. Greece is simply an icon for all of the rest of the European countries and the US. Greece has entitlements that it cannot afford and over half of Greece's employees work for the government. Their budget deficit is now over 13 percent of GDP and GDP is falling and the deficit is rising. Retirement age is in the 50s and tax fraud is commonplace. The tax fraud is so bad in Greece that it is suggestive that most Greeks have little or no respect for their legal institutions.
So, the Greeks spend money and indulge themselves with money that they do not have. Bondholders, outside of Greece, have been funding this nonsense for years, but are now balking at continuing to do so. Naturally, the Greek government now looks to other countries for a bailout, instead of taking steps on their own to curb the enormous stupidity that passes for social policy in Greece. Greece is a protypical European welfare state. They are a small version of the situation that exists in every single European country.
Greece, of course, is now demanding that other countries bail them out -- Germany is at the top of their list. Germany has insisted that the Greeks take steps to reign in their out-of-control, unfunded, spending habits. So, what is happening? Greece's largest government employee union is now planning a 24 hour strike. The political system in Greece is breaking down. Not willing to stop living off of other people, the Greeks are now threatening to bring down their own economy and their own political system. This is only the beginning. This political breakdown will spread to other countries in Europe and dominate the future of Europe. All of these pampered and protected groups who think they are entitled to free retirements at early ages and free health care are now finding that there is no one left to pay for all of this. There are no squirrels left that are willing to gather acorns in the Spring and Summer for the Greeks to eat in the Winter. So, now it is time to fight it out in a broken political process.
It won't matter. Simple arithmetic tells you that the Greek experiment, like the European experiment, in the welfare state will fail ultimately, for the simple reason that there is no longer any group of folks that will pay for this. This ponzi scheme has run its course, though the political posturing will go on for another decade or two. It will take some time for Europe to realize that the European welfare state model is untenable. Whether Europe will opt for another round of fascism or move toward free markets is an open question and much in doubt. But, the welfare state is entering its death throes, though the final death will take some time.
Meanwhile, the "poat-partisan" Obama Administration is planning to ram down the throats of an unwilling public, a radical restructuring of American health care that will deny coverage and choice, dramatically raise health care costs and put nearly 20 percent of the economy under direct government control. The public is overwhelmingly against this legislation. But, that doesn't matter. The arrogant Administration and their allies in Congress are determined to cram down this unpopular legislation regardless of public opposition. This Chavez-like strategy that Obama is embarked upon shows the dangers of putting an untested, inexperienced team in the White House, that has a condescending view of the average American. Obama and his crowd have nothing but contempt for the opinion of the average American and the average American knows it.
It is doubtful that Obama-Pelosi will get their way, even with their irresponsible assault upon American political institutions and the economy. But, the very effort to do so, shows that the American political system is broken as well. Never has a bill so unpopular been presented to the Congress and never has a President and his political party been so willing to slap the American people in the face. "The public be damned" is an apt description of the operating style of the Obama Administration. They simply do not care what anyone thinks. Chavez doesn't either. No wonder Obama was busily smiling and shaking Chavez's hand early in his administration. They have very similar views. Neither has much respect for free institutions.
Monday, March 1, 2010
Senator Bunning is Right on Both Counts
Current law provides 99 weeks of unemployment benefits. Research on search efforts of the unemployed concludes that interest in looking for a job is relatively dormant until the last four weeks before unemployment compensation runs out. The benefits run as high $ 30,000 annually in some states (New Jersey, for example). Why work?
Senator Jim Bunning of Kentucky, who is retiring this year and not running for re-election, is currently filibustering a bill to "temporarily" extend long term unemployment benefits. Bunning says the money should come out of the Stimulus Act and not be a new addition to the deficit. Bunning is right. But, he is also right that long term unemployment benefits are a bad idea. It is a subsidy to the unemployed and whatever you subsidize you will get more of. Two years is enough for unemployment benefits. Beyond that, you are simply creating a new welfare entitlement.
Senator Jim Bunning of Kentucky, who is retiring this year and not running for re-election, is currently filibustering a bill to "temporarily" extend long term unemployment benefits. Bunning says the money should come out of the Stimulus Act and not be a new addition to the deficit. Bunning is right. But, he is also right that long term unemployment benefits are a bad idea. It is a subsidy to the unemployed and whatever you subsidize you will get more of. Two years is enough for unemployment benefits. Beyond that, you are simply creating a new welfare entitlement.
Euro Bailout Won't Work
Buying time, the German and French governments have agreed to provide guarantees to their own banks who purchase Greek debt. This does nothing to stem the massive deficits that plague the Greek government. This will encourage the Greeks to take no steps toward solving their own fiscal problems. In time, the problems in Greece will spread and magnify. Ultimately, both Germany and France will be looking for someone to bailout themselves out. The ticking time bomb that is the bankruptcy of the European welfare state inexorably continues to tick. The bailout proposed by Germany and France reveals the weakness inherent in the Euro union and makes it easy to forecast the future collapse of the Euro and the bankruptcy of most of Europe.
The simple truth is that you cannot retire folks in their mid-50s at nearly full compensation and provide everyone in your country with free health care. It's a nice idea that sounds good, but it implies bankruptcy. Germany and France are the suckers, for the moment, and they will be looking for other suckers in time.
The simple truth is that you cannot retire folks in their mid-50s at nearly full compensation and provide everyone in your country with free health care. It's a nice idea that sounds good, but it implies bankruptcy. Germany and France are the suckers, for the moment, and they will be looking for other suckers in time.
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