Tag Archives: federal spending

Earlier this month, I posted a piece documenting Barack Obama’s incapacity as an executive. I followed up with a brief examination of Bobby Jindal’s record as Governor of Louisiana and, then, with a short discussion of a display of vigor and dispatch on the part of Chris Christie, Governor of New Jersey – both of whom nicely illustrate what Alexander Hamilton had in mind when he wrote in The Federalist that “energy in the executive is a leading character in the definition of good government.” Today, I will take a brief look at Mitch Daniels, Governor of Indiana.

Daniels is an accomplished man with considerable and varied experience in both the public and the private sectors.

On his father’s side, Daniel’s grandparents were Syrian Christians, and he has been honored by the Arab-American Institute for the work that he has done on behalf of Arab community in this country. He was himself born in Monangahela, Pennsylvania, where his paternal grandfather ran a pool hall and, on the sly, reportedly made book. As a child, he lived not only in Pennsylvania, but in Georgia, Tennessee, and Indiana, where his parents settled when he was ten. After graduating from a public high school in Indianapolis, he attended Princeton University. There, for a time, this straight arrow appears to have succumbed to the Zeitgeist In 1970, he spent two nights in a New Jersey jail after being arrested for marijuana possession. Nine years later, however, he was awarded a law degree by the Georgetown University Law Center in DC.

Daniels got his start in politics working for Richard Lugar – initially when Lugar was mayor in Indianapolis and later when that worthy was elected to the U.S. Senate. For a long time, Daniels was Lugar’s right-hand man. He ran the latter’s first three senatorial campaigns; and, from 1977 to 1982, he served as his chief of staff. In 1983, when Lugar was elected chairman of the National Republican Senatorial Committee, Daniels became its executive director.

In 1985, Daniels left Lugar to join the presidential administration of Ronald Reagan, where in time he succeeded Haley Barbour as chief political advisor and liaison. When he returned to Indiana in 1987, Daniels did so as chief operating officer of the Hudson Institute, a conservative think-tank then in financial trouble; and three years later, after having put Hudson on a sound footing, he went to work for Eli Lilly, where he soon became President of North American Operations and eventually Senior Vice-President for Corporate Strategy and Policy.

In January, 2001, Daniels went back to Washington, DC to become George W. Bush’s Director of the Office of Management and Budget, which made him an ex officio member of the National Security Council and, when it was set up, of the Homeland Security Council. At the time, he was known as an advocate of fiscal restraint, and Bush, who was not as profligate at first as he later became, described Daniels in public as “The Blade” and referred to him in private as “My Man Mitch.”

Daniels’ resume up to this point is impressive, but it would not be of paramount interest had he not returned to Indiana in the summer of 2003 to launch a gubernatorial campaign aimed at ousting the Democratic incumbent. Indiana’s budget at the time was deep in the red, and Daniels, who was elected in November 2004 with 53% of the vote, vowed to bring it into balance.

This “The Blade” accomplished in short order. Upon election, he created an Office of Management and Budget for the state, and then, under his direction, the men with the green eyeshades went to work. Within a year, they had turned a $600 million deficit into a $300 million surplus, and Daniels had begun paying down Indiana’s enormous debt. Four years later, the state was running surplus of $1.3 billion; and, in 2008, Indiana’s Governor ushered through the legislature a bill cutting property taxes on the average house by more than 30%.

Along the way, Daniels decertified the public service unions, reduced the number of those employed by the state by 14% to a level last seen in 1982, shifted most state employees to health savings accounts, introduced a pay-for-performance plan within the bureaucracy, reorganized the Bureau of Motor Vehicles, brought an end to social promotion within Indiana schools, and sold the interstate turnpike stretching across the northern reaches of the state between Ohio and Illinois to outside investors for a cool $3.9 billion, which was immediately sequestered in an escrow account, where it is used for road construction elsewhere in the state (and nothing else).

In November 2008 – when Barack Obama defeated John McCain and the Democrats took the state house and senate in Indiana – Daniels bucked the trend and was re-elected Governor by an 18% margin. In the process, he picked up 20% of the African American vote, and he won a majority among younger voters.

These days, Daniels’ approval rating oscillates between 60 and 70% – which is remarkable given that he is a balding, mild-mannered, unassuming man inclined to travel through the state on a Harley, stop at a diner, and sit down to chat with the patrons. His political success may have something to do with Daniels’ mastery of the technology of communications. His personal version of Reality TV – which is called MitchTV – is a local hit. But his popularity has even more to do with his achievements.

Mitch Daniels may have the demeanor of a staffer, and he has, indeed, done a great deal of work in that capacity. But – like Bobby Jindal, who is 39, and Chris Christie, who is 47 – “The Blade,” who is 61, is a man of executive temperament ready, willing, and able to take charge. Thanks to his stewardship, Indiana is solvent, and it is one of the nine American states with a triple-A bond rating. Moreover, it has begun attracting venture capital; for the first time in decades, people are moving into state; and, though it has only 2% of the national population, Indiana can boast that it garnered 7% of the new jobs created in the United States in the last year.

I cannot say whether any of the governors I have looked at in the last two weeks would make a suitable presidential candidate. But this much is clear. In the great crisis we now face, we are saddled with a President more inclined to dither, play golf, party with celebrities, and punt than to take charge and display energy, vigor, and dispatch when confronted with emergencies requiring decisions on his part. Whatever defects they may possess – and each is no doubt defective in some way – Jindal, Christie, and Daniels would not dither or punt. Each in his way exemplifies responsibility – the virtue singled out in The Federalist as distinctively American — which is no small thing.

Late last week, at the 11th hour, the Senate removed an amendment that would have required the inspector general of the Federal Deposit Insurance Corporation to investigate the corrupt ShoreBank bailout, as well as every other bailout since January 2009. It is the clearest sign yet that the White House and Democrats in Congress are covering up the truth. If there is nothing to hide, why block the ShoreBank investigation?

Even Rep. Barney Frank had publicly given his support to a ShoreBank probe. The bank claimed an investigation would delay the arrival of funds needed to keep it afloat. Yet Frank made sure that none of the banks being investigated would have had their federal assistance suspended (as the amendment originally provided). So there was no chance that ShoreBank’s bailout–if it were to be approved–would have been stalled.

Lynn Sweet of the Chicago Sun-Times–who is close to Rep. Jan Schakowsky (D-IL), the main political sponsor of the ShoreBank bailout–asks: “What exactly does Chicago’s ShoreBank have to do to survive?” But the real question she and other journalists must ask–and would ask, if this were any other bank–is: “What exactly are Democrats trying to hide?” If this Congress won’t investigate corruption, we ought to elect one that will.

In his recent cover story for The Weekly Standard, Matthew Continetti praises CNBC’s Rick Santelli effusively for erupting against Barack Obama’s redistributionist policies on 19 February 2009 in such a fashion as to inspire the Tea Party Movement. Then, he blasts Fox News commentator Glenn Beck for seizing upon the current crisis as an opportunity for urging on the part of his fellow Americans a serious reconsideration of the country’s first principles.

“What distinguishes Beck from Santelli is,” Continetti writes, “the breadth and depth of his critique.”

In his broadcasts, books, and stage performances, Beck provides his audiences with a dark vision of American life. In this bleak tableaux, rich, highly educated, radical elites are using the instruments of power to control the common man and indoctrinate his children. The elites, Beck says, seized on the 2008 financial crisis to shape America according to their socialist, fascist, globalist vision. The only remaining obstacle to the elitist agenda is the pro-freedom movement that wants to return to America’s founding principles. The elitists fight the patriots by calling them racists and extremists.

Beck is not simply an entertainer. He and his audience love American history. They are hungry for new ways to interpret current events. And Beck is creating, in Amity Shlaes’s words, “a competing canon” of texts and authorities. This competing canon is not content to assault contemporary liberalism, but rather deconstructs the very foundations of the New Deal and the Progressive Era. Among the books Beck regularly cites on his programs are Shlaes’s Forgotten Man, Jonah Goldberg’s Liberal Fascism, Larry Schweickart and Michael Allen’s Patriot’s History of the United States, and Burt Folsom Jr.’s New Deal or Raw Deal? And books like Matthew Spalding’s We Still Hold These Truths, Seth Lipsky’s Citizen’s Constitution, and William J. Bennett and John Cribb’s American Patriot’s Almanac all belong on the list as well.

This intellectual journey has led Beck to some disturbing conclusions. Whereas Rick Santelli says the housing plan and the stimulus aren’t sensible, Beck says the Obama administration is the culmination of 100 years of unconstitutional governance. On the “We Surround Them” episode, Beck said, “The system has been perverted and it has to be restored.” In between bouts of weeping, he asked, “What happened to the country that loved the underdog and stood up for the little guy?” That country, he implied, is vanishing before our eyes. In Beck’s world, politics is less about issues than it is about “us” versus “them.” We may have them surrounded. But “we can’t trust anyone.”

The reason no one can be trusted, Beck says, is that the political system is compromised by the ideology of progressivism. At his keynote speech to the 2010 Conservative Political Action Conference, Beck wrote the word “progressivism” on a chalkboard and said, “This is the disease. This is the disease in America.” He said again, “Progressivism is the cancer in America and it is eating our Constitution.”

When he refers to progressivism, Beck is not only highlighting the liberals’ latest name for liberalism. He is referring to the ideas of John Dewey, Herbert Croly, and Walter Lippmann. According to Beck (and many others), these early 20th-century thinkers believed that there is no such thing as natural right. The Constitution, in their view, was not equipped to deal with the complexities of modern society. They argued that government should do more to protect free competition by busting trusts, and also promote equality and individual development through redistribution. The progressive tendency found political expression in Theodore Roosevelt’s “New Nationalism” speech of 1910 and in Woodrow Wilson’s presidency from 1913-1921. It became the foundation for FDR’s New Deal.

Continetti believes that Beck is “engaging in a line of inquiry that – interesting though it may sometimes be – is tangential to the political realities of our day.” Where Beck claims that the “communism and progressivism” are at odds with regard to “means not ends,” contending that “‘there is no difference except [that] one requires a gun and the other does it slowly,’” Continetti retorts that “progressivism is a distinctly American tradition that partly came into being as a way to prevent ideologies like communism and fascism from taking root in the United States,” adding, “Not even the stupidest American liberal shares the morality of the totalitarian monsters whom Beck analogizes to American politics so flippantly.”

Who is more nearly right? Matthew Continetti or Glenn Beck? Do our problems arise from over-reaching on the part of Barack Obama? Or do they have deeper roots?

I know of no clearer testimony pertinent to this matter than that of Walter Lippmann. As followers of Glenn Beck’s television show presumably know, Lippmann was the prince of the progressives. At Harvard College, he dabbled in socialism. Some four years after his graduation, he joined Herbert Croly and Walter Weyl in founding The New Republic. In 1914, he published the influential progressive tract Drift and Mastery: An Attempt to Diagnose the Current Unrest. For a brief time, during the First World War, Lippmann served as an advisor to Woodrow Wilson. Among other things, he drafted Wilson’s Fourteen-Points Speech

After that war, however, having witnessed the effectiveness of propaganda, Lippmann began to harbor doubts about the progressive conviction that popular sovereignty and governance by experts can easily be reconciled. In Public Opinion, published in 1922, he called into question the capacity of ordinary citizens to discern what was going on; and, in The Phantom Public, published five years later, he expressed doubts as to whether it made any sense at all to speak of the public interest in the manner in which the progressives did: as something radically distinct from and in tension with individual rights and the diverse private interests of the citizens.

In 1932, thinking that there was no alternative, Lippmann voted for Franklin Delano Roosevelt. But by 1937, when the shape of the Second New Deal had become clear, he had come to entertain grave misgivings. And at that point, in a book entitled An Inquiry into the Principles of the Good Society, he issued a damning judgment – which I quoted at length in my book Soft Despotism, Democracy’s Drift, and which , I believe, we should all take to heart:

Although the partisans who are now fighting for the mastery of the modern world wear shirts of different colors, their weapons are drawn from the same armory, their doctrines are variations of the same theme, and they go forth to battle singing the same tune with slightly different words. Their weapons are the coercive direction of the life and labor of mankind. Their doctrine is that disorder and misery can be overcome only by more and more compulsory organization. Their promise is that through the power of the state men can be made happy.

Throughout the world, in the name of progress, men who call themselves communists, socialists, fascists, nationalists, progressives, and even liberals, are unanimous in holding that government with its instruments of coercion must by commanding the people how they shall live, direct the course of civilization and fix the shape of things to come. They believe in what Mr. Stuart Chase accurately describes as “the overhead planning and control of economic activity.” This is the dogma which all the prevailing dogmas presuppose. This is the mold in which are cast the thought and action of the epoch. No other approach to the regulation of human affairs is seriously considered, or is even conceived as possible. The recently enfranchised masses and the leaders of thought who supply their ideas are almost completely under the spell of this dogma. Only a handful here and there, groups without influence, isolated and disregarded thinkers, continue to challenge it. For the premises of authoritarian collectivism have become the working beliefs, the self-evident assumptions, the unquestioned axioms, not only of all the revolutionary regimes, but of nearly every effort which lays claim to being enlightened, humane, and progressive.

So universal is the dominion of this dogma over the minds of contemporary men that no one is taken seriously as a statesman or a theorist who does not come forward with proposals to magnify the power of public officials and to extend and multiply their intervention in human affairs. Unless he is authoritarian and collectivist, he is a mossback, a reactionary, at best an amiable eccentric swimming hopelessly against the tide. It is a strong tide. Though despotism is no novelty in human affairs, it is probably true that at no time in twenty-five hundred years has any western government claimed for itself a jurisdiction over men’s lives comparable with that which is officially attempted in totalitarian states.

But it is even more significant that in other lands where men shrink from the ruthless policy of these regimes, it is commonly assumed that the movement of events must be in the same direction. Nearly everywhere the mark of a progressive is that he relies at last upon the increased power of officials to improve the condition of men. Though the progressives prefer to move gradually and with consideration, by persuading majorities to consent, the only instrument of progress in which they have faith is the coercive agency of government. They can, it would seem, imagine no alternative, nor can they remember how much of what they cherish as progressive has come by emancipation from political dominion, by the limitation of power, by the release of personal energy from authority and collective coercion. For virtually all that now passes for progressivism in countries like England and the United States calls for increasing ascendancy of the state: always the cry is for more officials with more power over more and more of the activities of men.

Yet the assumptions of this whole movement are not so self-evident as they seem. They are, in fact, contrary to the assumptions bred in men by the whole long struggle to extricate conscience, intellect, labor, and personality from the bondage of prerogative, privilege, monopoly, authority. For more than two thousand years, since western men first began to think about the social order, the main preoccupation of political thinking has been to find a law which would be superior to arbitrary power. Men have sought it in custom, in the dictates of reason, in religious revelation, endeavoring always to set up some check upon the exercise of force. This is the meaning of the long debate about Natural Law. This is the meaning of a thousand years of struggle to bring the sovereign under a constitution, to establish for the individual and for voluntary associations of men rights which they can enforce against kings, barons, magnates, majorities, and mobs. This it eh meaning of the struggle to separate the church from the state, to emancipate conscience, learning, the arts, education, and commerce from the inquisitor, the censor, the monopolist, the policeman, and the hangman.

Conceivably the lessons of this history no longer have a meaning for us. Conceivably there has come into the world during this generation some new element which makes it necessary for us to undo the work of emancipation, to retrace the steps men have taken to limit the power of rulers, which compels us to believe that the way of enlightenment in affairs is now to be found by intensifying authority and enlarging its scope. But the burden of proof is upon those who reject the oecumenical tradition of the western world. It is for them to show that their cult of the Providential State is in truth the new revelation they think it is, and that it is not, as a few still believe, the gigantic heresy of an apostate generation.

This is a passage that should be read and re-read time and again. The present discontents may be a function of over-reaching on the part of Barack Obama, as Matthew Continetti implies. But the difficulties we now face are also deeply rooted in the prevalence within this country of a political doctrine that has been around for some time; and, as one repentant progressive testified three-quarters of a century ago, the difference between the communists and the progressives turns on means and pace – and not on ends.

I do not have a functioning television set. I have watched Glenn Beck’s show elsewhere only twice. On both occasions, he handled himself well. He may sometimes go overboard. I do not know. But this I can say: the inquiry that he is pursuing is by no means “tangential to the political realities of our day.” It goes to the heart of the matter. If we continue to temporize with progressivism, as we have in the past, there can be no question that we are cooked.

Barack Obama and Angela Merkel are the two main characters in what is being portrayed as a fight between American “stimulus” and European “austerity” at the G-20 summit meeting in Canada. My immediate instinct is to cheer for the Europeans. After all, “austerity” presumably means cutting back on wasteful government spending. Obama’s definition of “stimulus,” by contrast, is borrowing money from China and distributing it to various Democratic-leaning special-interest groups.

But appearances can be deceiving. Austerity, in the European context, means budget balance rather than spending reduction. As such, David Cameron’s proposal to boost the U.K.’s value-added tax from 17.5 percent to 20 percent is supposedly a sign of austerity even though his Chancellor of the Exchequer said a higher tax burden would generate “13 billion pounds we don’t have to find from extra spending cuts.”

Raising taxes to finance a bloated government, to be sure, is not the same as Obama’s strategy of borrowing money to finance a bloated government. But proponents of limited government and economic freedom understandably are underwhelmed by the choice of two big-government approaches.

What matters most, from a fiscal policy perspective, is shrinking the burden of government spending relative to economic output. Europe needs smaller government, not budget balance. According to OECD data, government spending in eurozone nations consumes nearly 51 percent of gross domestic product, almost 10 percentage points higher than the burden of government spending in the United States.

Unfortunately, I suspect that the “austerity” plans of Merkel, Cameron, Sarkozy, et al, will leave the overall burden of government relatively unchanged. That may be good news if the alternative is for government budgets to consume even-larger shares of economic output, but it is far from what is needed.

Unfortunately, the United States no longer offers a competing vision to the European welfare state. Under the big-government policies of Bush and Obama, the share of GDP consumed by government spending has jumped by nearly 8-percentage points in the past 10 years. And with Obama proposing and/or implementing higher income taxes, higher death taxes, higher capital gains taxes, higher payroll taxes, higher dividend taxes, higher business taxes, and a value-added tax, it appears that American-style big-government “stimulus” will soon be matched by European-style big-government “austerity.”

Here’s a blurb from the Christian Science Monitor about the Potemkin Village fiscal fight in Canada:

This weekend’s G-20 summit is shaping up as an economic clash of civilizations – or at least a clash of EU and US economic views. EU officials led by German chancellor Angela Merkel are on a national “austerity” budget cutting offensive as the wisest policy for economic health, ahead of the Toronto summit of 20 large-economy nations. Ms. Merkel Thursday said Germany will continue with $100 billion in cuts that will join similar giant ax strokes in the UK, Italy, France, Spain, and Greece. EU officials say budget austerity promotes the stability and market confidence that are prerequisites for their role in overall recovery. Yet EU pro-austerity statements in the past 48 hours are also defensive – a reaction to public statements from US President Barack Obama and G-20 chairman Lee Myung-bak, South Korea’s president, that the overall effect of national austerity in the EU will harm recovery. They are joined by US Treasury Secretary Tim Geithner, investor George Soros, and Nobel laureate and columnist Paul Krugman, among others, arguing that austerity works against growth, and may lead to a recessionary spiral.

To the American mind there may be nothing more quintessentially Swedish than the leggy, blond supermodel.

But there’s another Swedish model that inspires almost as much admiration—the Swedish economic model. With a generous welfare state and high living standards, Sweden seems to prove that socialism works. Much of the hope that swept Barack Obama into the White House rests on the belief that America could reach new heights under a regime of enlightened progressivism, that we could be more like the Swedes.

Not so fast, warns Stockholm University sociologist Charlotta Stern: “If an American told me that the US should be more like Sweden I would say I don’t think it’s possible.” The United States can centralize its health care system and pass other laws that mimic Sweden’s welfare state polices, says Stern, but it’s impossible to replicate a culture that allows those policies to operate about as smoothly as possible. Swedish bureaucracies inspire trust, but their American counterparts (DMV, TSA, IRS) inspire punch lines, if not outrage.

But America could emulate some of the Swedish policies that don’t require extensive bureaucracies. Take school vouchers. Teachers unions in America regard the idea as free-market radicalism, but families in Sweden enjoy universal school choice. Sweden adopted its famously progressive policies during the 1970s, but after years of sluggish economic growth the land of ABBA altered its course in the 1990s, adopting a host of free-market reforms, from deregulation to tax cuts.

Although much of the disco-era welfare state remains, economist Andreas Bergh credits the free market reforms with reviving his nation’s economy. “Sweden is moving in the market economic direction,” says Bergh, “but that does not mean America should be moving in the socialist direction.”

What if the two nations continue on in different directions? Maybe some day when America is looking for a way to rejuvenate its economy, pundits will point to a different kind of Swedish model. One that increases individual choice and competition.

“Sweden—A Supermodel for America?” is produced by Daniel B. Klein, and written and produced by Ted Balaker, who also hosts. Shot by Jonathan Liberman and Henrik Devell, with additional production support by Zach Weissmueller and Sam Corcos and post production by Hawk Jensen and Austin Bragg. Special thanks to Niclas Berggren, Martin Borgs, Nils Karlson, and the Ratio Institute.

Approximately 6.00 long.

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Kids placed in schools their parents chose for them – not the ones the government chose – graduate at a higher rate and are safer at school.  Who would have guessed?

According to an evaluation released yesterday by the US Department of Education Institute of Education Sciences, the DC Opportunity Scholarship Program (OSP) has “significantly improved students’ chances of graduating from high school.”  The same study finds that “parents had higher satisfaction and rated schools as safer if their child was offered or used an OSP scholarship.”

With these dramatic success indicators, it must be no surprise that DC OSP is the only federal education program that the Obama Administration is intent on killing.

Dr. Matt Ladner, vice president of research at the Goldwater Institute reports:

“…students who were randomly selected to receive vouchers had an 82% graduation rate.  That’s 12 percentage points higher than the students who didn’t receive vouchers.  Students who actually used their vouchers had graduation rates that were 21% higher.  Even better, the subgroup of students who received vouchers and came from designated Schools in Need of Improvement (SINI schools) had graduation rates that were 13 percentage points higher than the same subgroup of students who weren’t offered vouchers–and the effect was 20 percentage points higher for the SINI students who used their vouchers!”

That’s right.  Students who used their voucher to attend a school of their parents’ choice had a 21 percent higher graduation rate than those who were eligible for a voucher but were not offered one in the lottery process.  DC OSP is a federally-funded program that provides scholarships up to $7,500 to low-income families in Washington, DC – a pittance compared to DC Public School spending.

With these undeniable effects on graduation rates for low-income kids, why did Congress vote to kill DC OSP last year?  Why can parents no longer choose a school that they find to be safer and offer a better environment for their children?

DC kids and parents have been begging President Obama – who himself attended private school on scholarship – to support them since he took office.  But so far, the Obama Administration has cut the program by millions of dollars and disallowed new students to enter the program.

As common sense – and every study ever completed– tells us, high school graduation is a key indicator to success.  Students who do not graduate are significantly more likely to become single parents at young ages, rely upon public assistance, and go to prison.

No other federally-funded program that has had such a remarkable effect on graduation rates, nor has another federally-funded program met such high demand from parents firsthand.  Between 2004 and 2009, 5,500 students applied to participate in the program, and 3,700 received scholarships.

By opposing the DC Opportunity Scholarship Program, the Obama Administration is actively barring students from pathways to programs that have proven successful in increasing their chance to graduate college. This position is unconscionable.

In last year’s federal budget, Illinois Congresswoman Jan Schakowsky introduced and then withdrew what appears to have been a multi-million dollar earmark for the Save-A-Life Foundation (SALF), a now-defunct nonprofit that claims to have provided first aid training for nearly two million students, many of them in the Chicago Public Schools.

Problem #1: Three years earlier, SALF had been the subject of a series of hard-hitting ABC7 Chicago investigative reports that raised serious questions about every aspect of the organization: its founder, its operations, and its funding.

Problem #2: The Chicago Public Schools can’t or won’t produce records that support SALF’s claims.

Problem #3: Rep. Schakowsky won’t answer easy questions like these:  What was the dollar amount of her intended earmark for SALF? Why was she funding a non-profit that years before had been the subject of four scorching ABC7 exposes? What’s her relationship with the charity’s founder/president Carol J. Spizzirri, a convicted shoplifter who obtained millions in federal and state funds over the years? Does Rep. Schakowsky think SALF should be investigated in order to determine if those millions were properly spend?

The Progressive Politician

Jan Schakowsky’s district is north of Chicago and includes Evanston, Skokie, and west to Des Plaines. She’s the Democrat’s Chief Deputy Whip in the House and serves on the Steering and Policy Committee, the Energy and Commerce Committee, and chairs the House Select Committee on Intelligence’s Subcommittee on Oversight and Investigations. A member of the Democratic Progressive Caucus, she’s considered one of the most liberal members in Congress.

The Discredited Foundation

A recent American Thinker article provided an overview of the Save-A-Life Foundation and asked why SALF employee turned whistleblower Annabel Melongo is now in Cook County Jail with a $300,000 bond for a minor felony charge of “eavesdropping.” From 1993 until it folded September 17, 2009, SALF received “at least $8.6 million in federal and state grants” as well as funding from the Ronald McDonald House, Blue Cross/Blue Shield, and other foundations.

SALF also enjoyed support from a host of powerful public officials on both sides of the aisle including, but not limited to: IL Sen. Dick Durbin; IL Attorney General Lisa Madigan; Speaker of the Illinois House of Representatives Michael Madigan (Lisa’s father); U.S. Secretary of Education and former CEO of the Chicago Public Schools (CPS) Arne Duncan: and current Republican senatorial candidate U.S. Rep. Mark Kirk.

SALF began unraveling in November 2006 when Chicago’s ABC7 aired the first of a series of investigative reports that exposed dubious claims about the numbers of students trained and that Spizzirri was not a Registered Nurse with a four-year college degree as she claimed. Most shocking, Spizzirri and her organization altered the facts surrounding her 18-year-old daughter’s death in a Labor Day 1992 car crash, presumably to enhance fundraising. When ABC7 Chicago reporter Chuck Goudie confronted Spizzirri about it, she stormed out of the interview.

On May 31, 2007, ABC7 broadcast the fourth Goudie story. It began with the statement that “Save-A-Life’s main government funding may be drying up.” In an interview with now-retired Illinois Senate President Emil Jones Jr., he acted as if he’d never even heard of Spizzirri’s organization, let alone helped fund it. But two years later, blogger Doug Ross uploaded tax documents that identified Sen. Jones, Barack Obama’s political mentor, as one of their corporate officers.

The Mystery Earmark

But, as Ross first reported, SALF’s government funding didn’t dry up in 2007. According to her press secretary Sarah Baldauf, Rep. Schakowsky submitted an earmark for SALF in February 2008 for the 2009 federal budget. Later, Schakowsky withdrew the earmark when the organization began having “troubles,” according to Baldauf, a former health writer for U.S. News & World Report. So Big Government submitted these questions to Baldauf in hopes of getting answers from her boss:

(1) ABC News Chicago investigative reporter Chuck Goudie’s four reports on SALF aired from Nov 2006 – May 2007. The Congresswoman pulled support for the SALF earmarks sometime after she originally proposed them in Feb 2008, 9-10 months after Goudie’s reports.

(a) What prompted the delay in withdrawing her support for the earmarks, particularly since the Chicago Public Schools (CPS) had ceased doing business with SALF as was communicated by DPS CEO Arne Duncan in a letter to SALF founder and director Carol Spizzirri in December 2005?

(b) Was Congresswoman Schakowsky unaware of the turmoil surrounding SALF? Or, was she misled as to the seriousness of the allegations against SALF by Spizzirri, ex-Palatine Mayor Rita Mullins [Spizzirri’s partner running SALF], or someone related to SALF in an official or unofficial capacity?

(2) SALF received, over the years of its operation, $2,633,000 in grants from the CDC. Has Congresswoman Schakowsky ever called for an investigation concerning whether those federal grant monies, and any other federal grant monies, were properly expended by SALF? If not, why not?

(3) What was the amount of the SALF earmarks Congresswoman Schakowsky originally proposed for the FY 2009 budget?

Despite multiple follow-up queries, here’s the only response Baldauf would provide:

As I’ve said, the Congresswoman withdrew her support for SALF when she learned of the group’s troubles. She never helped secure any money for the foundation.

Since Schakowsky’s husband went to prison for financial fraud involving another nonprofit of which she was a board member, you’d think she’d be more sensitive about such things. Instead, she gives the brush-off to those asking questions.

From today’s Politico:

An all-night House-Senate conference committee delivered President Barack Obama and Democrats a far-reaching and historic achievement Friday – a realignment of the rules that govern Wall Street and a second victory toward Obama’s legislative triple crown.

The compromise bill now goes to the House and Senate for approval. For all the messiness of the process, financial reform and March’s health care reform win cumulatively make clear Obama and Democrats are governing in consequential ways – and once again Friday, without a single Republican vote. The results make clear the argument over Obama is no longer whether he’s effective or not, but whether voters will like the results.

The agreement came at 5:39 a.m., after 20 straight hours of work in the committee, a marathon session that tested the negotiating skills, patience and endurance of several dozen lawmakers tasked with reconciling two competing approaches to reining in Wall Street.

But it left no doubt about the mark Obama has left on his twin Democratic majorities in Congress – reluctant, even recalcitrant at times, but in the end, doing his bidding to remake two of the most important sectors of the U.S. economy.

His hoped-for third act – a wide-ranging climate change and energy bill – is next on Obama’s docket, and absent these successes, it would be easy to believe there was simply no way he could bend Congress to his will yet again, with midterms looming, poll numbers sagging and the nation’s financial coffers tapped out.

But Obama plans to press his advantage – to try to salvage one more legislative win out of the depths of the BP oil spill tragedy. He’s invited what amounts to the bipartisan Senate climate caucus to the White House Tuesday to plot out a way ahead.

Continue reading here.

The House Financial Services Committee voted Wednesday to launch an investigation of the ShoreBank bailout, a scandal that was first revealed here at BigGovernment.com. Of the dozens of banks that have failed this year, only ShoreBank received help from Washington and Wall Street. The reasons: its connections to the White House, its close relationship with Rep. Jan Schakowsky (D-IL), and its importance to the radical left.

After I broke the story in January, other bloggers, notably the Central Illinois 9/12 project, connected more of the dots. Soon, the Wall Street Journal, the Chicago Tribune, and even the New York Times began following the story. Two weeks ago, my campaign joined Rev. Isaac Hayes (who is challenging Jesse Jackson, Jr. in IL-2) and the Illinois Tea Party in a spirited protest outside ShoreBank’s offices on LaSalle Street in downtown Chicago.

Representatives Judy Biggert (R-IL) and Darrell Issa (R-CA) took up the cause and demanded answers about the White House’s role. Suddenly, the Treasury and the Federal Reserve began backing away from the bailout. That triggered a public attack on Treasury secretary Tim Geithner by the Illinois Finance Authority. Finally, Rep. Biggert succeeded in inserting an investigation of ShoreBank into the financial reform bill.

The financial reform bill is still a job-killer.  But if it does pass, the consolation is that Congress will investigate the ShoreBank bailout. The fact that a bipartisan committee managed to agree on the investigation shows how important the allegations are.

Meanwhile, the ShoreBank bailout is still on hold. Thanks to bloggers, the much-maligned Tea Party, and bold leadership on Capitol Hill, we have stopped a corrupt bailout, against overwhelming odds!

That’s because when the entire country is hurting and the private sector continues to lose jobs, bureaucrats are being hired.

The following chart makes that case. Since the beginning of the recession (roughly January 2008), some 7.9 million jobs were lost in the private sector while 590,000 jobs were gained in the public one.  And since the passage of the stimulus bill (February 2009), over 2.6 million private jobs were lost, but the government workforce grew by 400,000.

Plus, as you know, according to the latest numbers from Bureau of Economic Analysis, the average federal civilian worker now earns double what private-sector workers earn when factoring in wages and benefits ($119,982 vs. $59,909). And the gap is increasing.  According to Chris Edwards of the Cato Institute, in 2000, the average federal worker earned 66 percent more in total compensation than the average private-sector worker. By 2008, that ratio had risen to 100 percent. That’s serious money.

Peter Orszag, the soon to be leaving OMB director, has  explained the differences in pay by saying that public employees have more diplomas (probably implying that they are smarter) than private employees:

But the truth is that a comparison of federal and private-sector pay, even by occupation, is misleading because the employees hired by the federal government often have higher levels of education than their counterparts in the private sector — even within the same occupations.  When you factor in the education and experience of the federal workforce, there is no statistically significant difference in average pay levels.

Edwards, however, shows this is nonsense. He writes:

Some people argue that the federal government has a unique high-end workforce, which deserves to be paid handsomely. But let’s consider some ordinary and mundane offices in the U.S. Department of Agriculture. In 2010, the USDA’s Office of Communications employed 77 people and paid $9 million in wages and benefits. That works out to $117,000 each for these public relations workers, which is close to the overall federal compensation average. Or consider that the 62 employees of the USDA’s Office of Chief Economist earned an average $177,000 each in wages and benefits in 2010. It isn’t just rocket scientists that are earning high federal compensation, it is also workers in many run-of-the-mill bureaucratic jobs.

More importantly, the federal workforce has always had a heavy contingent of skilled professionals such as lawyers. So that is not new, and thus it cannot explain the dramatically faster growth in federal compensation compared to private compensation [...].

Besides, if these diplomas are what gave is the health care reform, the financial bill making its way to Congress and the stimulus, then I would argue that we would be better off if  high-school dropouts to run Congress.

That being said, if bureaucrats have job security, their workforce grows during recession, and they make increasingly more money, being a proud public sector employee should become your little ones’ dream. In this context, wanting to be a fireman or a princess is so yesterday.

Aside from breaking her word to the AMA and physicians across the country, Democrat House Speaker Nancy Pelosi has effectively demolished doctor reimbursements for most of the healthcare industry.  The 21.2% Medicare fee schedule cut has taken effect, but what most do not realize is that the Medicare fee schedule is the gold standard for provider reimbursement fee schedules across the nation.

Essentially, where Medicare goes, insurers follow for the guidelines in covered services and baseline physician fee schedules for private payers as well as worker’s compensation and automobile insurance companies in most states, as well as Medicaid and Medicare itself.

What Pelosi has effectively done is saved the insurance companies who use the Medicare fee schedule millions of dollars of payouts to physicians on their claims–regardless if the patient is a Medicare patient.  I’m not seeing the insurance lobby out there right now, are you?  However, on the provider side, the doctor’s lobby groups are outraged at Pelosi’s failure and the damage this inaction will cause physicians–especially private–and force them to layoff employees to make up for the loss in reimbursements to cover their enormous monthly overhead costs.

Pelosi is completely ignorant of the doctor’s fee schedules and how their reimbursements are calculated.  In a multilayered approach and working with the Centers for Medicare and Medicaid Services (CMS), the AMA Resource-Based Relative Value Scale (RBRVS) is used and the AMA/Specialty Society Relative Value Scale Update Committee (RUC) makes annual recommendations regarding new and revised physician services to CMS and performs broad reviews of the RBRVS every five years.  These values have not been adjusted since the 21% fee schedule reduction took effect and for Pelosi to ignore the fact that the doc fix will actually cost doctors to see their patients because their fees will be reduced, but the cost of providing the services and the supplies needed have not gone down and in some cases, continue to rise.  Additionally, student loan payments have not been decreased by 21% for doctors, have they?

The only business segment to ultimately win is the insurance industry.

Real-world exit questions:  If you own a company and your revenue just got nicked by 21%, but your supplies and cost of services has remained the same, how long before you will have to layoff employees to cover your monthly costs?

Do people understand that private practice physicians take most, if not all, of their salaries on assignment?  Physicians must do this because of provider contracts and other variables, but their fees are not a guarantee of payment; claims can be denied in part or in full.  (Some lawyers take their fees on assignment, but it is their choice.)  And now, doctors are being used as political pawns by the Democrats.

Is it possible that the Democrats are attempting to push doctors into the union, say the SEIU?  Only those doctors who are in private practices, not employed by hospitals cannot unionize, so what’s next for them?

Nothing like having a bunch of bureaucrats who have no idea about healthcare, costs of providing services,  running a business, covering overhead, etc. in charge of your salary, covered services, and future.

Finally, this is clearly a Democrat problem, after all, “You won.”  And by that, Americans now understand that to mean that the Democrats are clearly the party of cry-babies, finger-pointers, and blame-shifters.  And job killers, because if your more than $800 billion stimulus and jobs bills actually provided jobs, we wouldn’t need unemployment extenders in current legislation.  Americans would actually be back to work, wouldn’t they, Nan?

Reason.tv presents Citizens Against Government Waste’s Porker of the Month for June 2010. CAGW makes this award to a politician or special interest who takes pork-barrel spending to new heights.

This month’s winner is Sen. Richard Shelby (R-Ala.)!

The Constellation Program was intended to modernize NASA and replace the aging Space Shuttle, but has been plagued by cost overruns and blown deadlines.  President Obama and NASA have proposed canceling the unsustainable program—turning instead to the emerging private space industry to oversee launches.

In response, Sen. Richard Shelby (R-Ala.) co-sponsored a measure protecting Constellation, which was attached to an emergency war funding bill. Such a measure ensures millions of taxpayer dollars will continue being funneled to politically connected NASA contractors.

Contractors like Alabama’s own Radiance Technologies, which—wouldn’t you know it—just happens to be one of Shelby’s biggest campaign contributors.

Congratulations Sen. Shelby, you are the Porker of the Month for June 2010!

For more info on Citizens Against Government Waste and the Porker of The Month, go here.

Written, produced, and narrated by Austin Bragg. Co-produced by Ted Balaker and Hawk Jensen. Approximately 1.15 minutes.

Go to Reason.tv for downloadable versions of all our videos and subscribe to Reason.tv’s YouTube channel to receive automatic notification when new material goes live.

Recently, my colleagues in the U.S House of Representatives passed a bill that will undoubtedly further harm our already weakened economy by discouraging investment in businesses and real estate. With national unemployment at 9.5% and no sign of relief in sight for the real estate market, now is no time to be discouraging this type of investment and the jobs that it creates.

The American Jobs and Closing Tax Loopholes Act (HR 4213) that passed the House by a narrow margin included an extraordinary tax increase on carried interest returns from successful investments by real estate, venture capital, and private equity partnerships. This revenue is currently taxed at the 15% capital gains rate, which is already scheduled to increase to 20% next year. Carried interest provides incentive for investment partners to take the risky investments that are needed to create jobs and boost the economy.

The U.S. Senate expects to vote on the bill in the coming weeks. Senator Max Baucus introduced a compromise amendment that would tax a smaller portion of the carried interest revenue at the new higher rates, but the impact of any tax increase on carried interest will still be harmful and widespread. I will not vote for any bill that includes a tax increase on carried interest, and I will urge my colleagues to join me in opposition.

What’s most alarming about this tax rate increase is that it is deeply punitive on the very businesses we need to help stabilize our economy. The increase would overturn decades of partnership tax law, and these partnerships would be the only businesses in the country whose enterprise value would be taxed at the income tax rate rather than the capital gains tax rate. These partnerships would be unfairly punished for the mistakes of a few Wall Street managers, despite the fact that these partnerships are in the best position in our economy to continue to create and grow businesses and jobs.

Additionally, the carried interest revenue is often pumped right back into the economy.  Typically investment partners use the revenue of successful investments to invest in new small businesses and commercial properties, and expand and restore existing investments. This leads to job growth and economic investment in communities.

The Private Equity Council just released a study on the impact of a tax increase on carried interest. They found that a tax increase of just one percentage point would cause investment to decline by $1.8 billion. The House bill’s proposal would cause investment to decline by $27 billion.

Without the tax increase, these partnerships will be investing $27 billion in jobs and the economy. That’s a lot of money, and a lot of jobs.

It’s clear that a tax increase, especially an increase of the magnitude passed by the House, would be a bad move for the economy. Our nation must focus on getting real estate investment, employment rates, and the general economic outlook back up, not loading down the economy with unfair tax increases.

I’ll be voting against the tax increase on carried interest when it comes back over to the House, and I urge my Senate colleagues to do the same.

Like a relentlessly advancing cancer, the news about the US fiscal deficit and the accumulated debt, which is its result, keeps getting worse.  Every week the press discloses some supposedly “new” information about either the federal budget, economic failure, projections of economic growth, the effects of the so-called “doc fix” (about which we have written several times), the sorry fiscal condition of state and municipal finances, or some further jobs stimulus proposal, all of which pile more costs on this nation that, if it were a private business, would be considered broke.

Before looking at the most recent spate of deficit and debt related news, let us start with the CBO’s updated March 2010 report which estimated that the cumulative effects of the Administration’s budget proposals would add $9.7 trillion to our current deficit of $14 trillion (an amount equal to approximately ninety percent of our annual GDP and clearly approaching the danger zone).  This amount does not include any spending for enacting climate legislation or the effect of rising interest rates to service our debt or spending for contingencies from unplanned events which will inevitably occur.

Moreover, it projects economic growth every year at four percent when we have had only two quarters of growth at four percent or higher in the past five years and, at least since 1982, have never had four consecutive years of growth as high as four percent per annum.  That overly optimistic CBO assumption if not realized will raise the deficit and the accumulated debt, perhaps by trillions of dollars.

In recent days we see once again the fantasy of the most recent budget the president presented.  After just a few months it is outdated.  Mr. Obama has just asked Congress for an additional $50 billion in aid to state governments.  It is uncontested that state and local governments are in terrible fiscal condition and, of course, they can’t print money to inflate away their accumulated debts.  Cumulative state shortfalls in 2009 and 2010 alone are approximately $310 billion and projections for 2011 and 2012 combined are for an additional $300 billion.

State governments have in the past few years either borrowed with abandon or resorted to accounting gimmickry to approach balancing their budgets.  They have consistently looked for new sources of tax revenue or raised taxes on existing sources, making a reality of Ronald Reagan’s statement about government: “if it moves, tax it.”

The figures are appalling.  California alone projects a $9 billion shortfall in 2011 but when the unsolved 2010 budget gap is added in, the total shortfall would be $19.1 billion (22.6 percent of the one year budget).  This hall of shame also includes Illinois where the shortfall projected for 2011 is a whopping 30.1 percent of the budget, New Jersey at 37.4 percent, Maine at 32.1 percent, Michigan at 26.4 percent, Vermont at 31.1 percent and Wisconsin at 25.3 percent.

How did we get to this state (no pun intended) where services now need to be drastically cut, employees laid off, contracts cancelled and previously negotiated benefit packages renegotiated?  Simple.  Politicians love to promise and spend and at the state and local level, unions have organized state employees and have demanded pay and benefit packages way beyond what is paid for like work in the private sector.  With union representatives sitting on pension boards or having its employee members negotiating on behalf of government, the unions are, in effect, on both sides of the table.  These devastating numbers are even more stark and depressing when we consider that over the past two years the federal government has provided $140 billion in state budgetary assistance…approximately thirty to forty percent of state shortfalls.  The effect of this assistance seems only to have postponed the day of reckoning and allowed states to increase hiring and avoid necessary fiscal discipline.  Since 2007 public payrolls have increased while the private sector went through the worst downturn since the Great Depression with unemployment, even with a nascent and fragile economic recovery underway, still hovering just below ten percent.

After that depressing digression, let us return to the president’s proposal for a new $50 billion aid package for the states.  The president has written Congressional leaders to say that the package is essential to avoid “massive layoffs of teachers, police and firefighters.”  As reported in the Washington Post the president calls this a request for “targeted investments.”  The president also wants to extend unemployment benefits which raises the cost of his package to $80 billion.  And while no one wants to be heartless to the jobless who are in great economic distress, these benefits have been extended several times already and cannot (nor should not) be extended indefinitely.

Wasn’t this all known in the White House when the president first sent his budget to Congress?  Why did this request dribble out later packaged as it always is in a wrapper of being necessary to avoid layoffs affecting our children or the public’s safety.  What about the swollen bureaucracies of other state agencies?  Why doesn’t the president mention the incredible cradle to grave benefit packages that allow some workers to retire at age 50 at high percentages of their final year’s salary, with health benefits for the rest of their lives.  Doesn’t this answer become more and more apparent with every additional request for money?  It is because that is the kind of America Mr. Obama wants…. an America that takes more and more resources out of the productive growth producing private sector and pays it over to the non-productive public sector.  Even France, the poster child for excessive public spending, seems to be getting the message that this kind of model doesn’t work but Mr. Obama is imposing, in step by step increments, France’s failed statist approach on the unwitting taxpayers of the United States.

We might also note, as we did in some detail in earlier essays, that the functions the federal government has been funding to defray these state costs have been, since the founding of our republic, the responsibility of the several states.  This raises the obvious question of why the citizens of those states who have lived within their means should have their federal tax dollars used to pay for the unbridled profligacy to which the spendthrift states listed above have obligated their own taxpayers.

The other bit of recent bad budget news which the president recently announced was the so-called doc fix to reverse the 21 percent pay cut scheduled to take place for doctors who treat Medicare patients.  Surprise, surprise.  This fix, as Mr. Obama noted, has passed Congress every year since 2003.  However, he is now complaining that Republicans are using budget austerity (demanding commensurate cuts in spending elsewhere in the bloated federal budget)  as an excuse to prevent a long-term solution to this problem.  How he dissembles.

Just a few short months ago the doc fix was part of the president’s healthcare reform legislation but Congressional leaders removed it from the bill so the CBO could certify that the legislation was revenue neutral and did not “add one dime to the deficit” as the president intoned daily.  So in a most disingenuous piece of fiscal trickery Speaker Pelosi and Majority Leader Reid separated the doc fix from the overall healthcare reform legislation and put it in a separate bill, claiming it was a totally separate issue.  Voila; the CBO could now certify the ten-year cost of the healthcare legislation as not increasing the deficit but the very same costs are now to be incurred in a separate law.

So there we have it; the costs of the annual fix which, if included in the healthcare reform bill, might have prevented its passage, is later acknowledged to cause an increase in the deficit by the same amount. This Pelosi-Reid grand-scale shell game, to which the President acquiesced, fooled no one except, seemingly, the CBO, which actually did know under which shell “the fix” was in. Yes, of course, the CBO knew, the White House knew, the Congressional Democrats knew, the compliant main-stream press knew, we knew (and loudly complained at the time), and now everyone knows.  How stupid do these politicians think the American people are?

Make no mistake about it; all of this is not an accident.  Every incremental piece of legislation involving further federal spending is designed to disguise the further centralization of power in Washington.  The inescapable conclusion is that the strategy of Mr. Obama and the Democratic left which holds majority power in Congress is to irreversibly and fundamentally change America by putting in place policies, programs and funding mechanisms that will be difficult, if not impossible, to reverse without devastating costs to the ties that bind us as a nation, and which raise the possibility of terrible social upheaval.

Expressing disapproval with some Obama administration actions, many on the right — and some on the left — are complaining that the executive branch wields far too much power.  Similarly, when President George W. Bush was in power, many on the left — and some on the right — complained that the executive branch wielded far too much power.  Seeing this bipartisan concern for unbridled expansion of presidential power and wishing to start restoring the office to its Constitutional limits, Congressman Geoff Davis (R-KY) has introduced the Regulations from the Executive In Need of Scrutiny (REINS) Act.

The REINS Act would require Congressional authorization for any new Major Rule proposed by the executive branch. It now has now has 57 cosponsors, including noted Constitutionalist Rep. Ron Paul (R-TX).  It also enjoys the support of the Chamber of Commerce.  Under REINS, the numerous proposed regulations pertaining to health care, climate change, energy, financial regulation, and our economy would have to be submitted to Congress for approval.   REINS would continue to allow the executive agencies charged with writing rules to propose draft rules, but would end the delegation of Congressional authority that has enabled these agencies to enact them unilaterally.

Our Founding Fathers recognized the pitfalls of an all-powerful chief executive.  Fearing tyranny, our nation did not even have a president until 1789, preferring instead strong states, a weak Congress operating under the auspices of the Articles of Confederation, and no executive branch at all.  As this proved to be too weak for national cohesiveness, our founders drafted the Constitution to provide the nation with three co-equal branches of government: legislative, executive, and judicial.  All three were to operate within the limits defined by the Constitution.

Our founders took great care in limiting presidential power.  Presidential power is limited to the powers granted by Article II of the Constitution.  As further protection against tyranny, our founders created a system where the president is chosen by the Electoral College rather than via direct election.  This was partly to keep the president from exceeding the authority granted by the Constitution by claiming a popular mandate.  The Constitutional system kept presidential power largely in check (temporary wartime expansions under President Lincoln and President Wilson being very notable exceptions) until the election of President Franklin Roosevelt.

President Roosevelt greatly expanded the power of both the presidency and the entire federal government.  He was the first president to submit legislation directly to Congress.  When much of this was overturned by the Supreme Court as unconstitutional, FDR reacted by bullying the Court with threats to pack it with New Deal supporters.  Once the Court started upholding New Deal legislation, FDR used this green light to expand the office of the presidency well beyond its Constitutional bounds, shifting federal power from Congress and the Supreme Court to the executive branch in the process.  Most presidents since FDR have sought to further expand the power of the office.

President Obama has continued this expansion of executive power.  He has given a great amount of power to unelected bureaucrats within the executive branch and has then, in effect, created law via the regulatory process.  No Congressional approval was sought for any of these actions.

Congress is finally fighting back.  When introducing the REINS Act, Congressman Davis shared this disturbing information:

Last year, the federal government issued 3,316 new rules and regulations.  That is roughly 1.6 rules per working hour or 12.8 rules per working day!  In many instances, federal rules impose substantial compliance costs on individuals, businesses, and State and local governments.  Rules with at least $100 million of annual compliance cost or effect on the economy are classified as “Major Rules.”  In 2009, federal agencies issued 78 Major Rules.

The regulatory process has increasingly ceded power to unelected bureaucrats for major decisions that can affect all Americans.  Take for example the Democrats’ government takeover of health care.  This poorly drafted legislation repeatedly requires the Secretary of Health and Human Services to create regulations in areas ranging from what is required for “qualifying health plans” to the determination and disclosure of nutritional information for standard menu items in restaurants.

The American people agree. In February, a CNN poll found that 56% of Americans believe the federal government is so large that it threatens the freedoms of ordinary citizens.  It is time for Congress to assert its Constitutional role in federal governance.

On Wednesday last, I posted a piece documenting Barack Obama’s incapacity as an executive. I followed up on the following day with a brief examination of Bobby Jindal’s record as Governor of Louisiana – which illustrates admirably what Alexander Hamilton had in mind when he wrote that “energy in the executive is a leading character in the definition of good government.” Today, I will take a brief look at Chris Christie, Governor of New Jersey.

Chris Christie is an original. He is the first Republican to have won statewide office in New Jersey in a dozen years, and he did so on 3 November 2009 by ousting from office an immensely wealthy sitting Governor who had previously served five years as United States Senator from that state.

In certain respects, Christie, who is 47, is quite unlike Bobby Jindal. He did not become a freshman at Brown when he was 20, win a Rhodes Scholarship to Oxford when he was 23, and serve as a cabinet secretary in state government when he was 25. He was not a boy wonder, and his rise has not been meteoric. Had you learned about him when he was 39 (as Jindal is now), you might well have concluded that he was a pretty ordinary guy.

Born in Newark, New Jersey, Christie grew in Livingston. In later years, he attended the University of Delaware, took a law degree at Seton Hall, and gained admission to the bar. After serving as an associate for six years, he became a partner in a law firm in Cranford, New Jersey, where he specialized in securities law, appellate practice, election law, and government affairs.

It is true that Christie did a brief stint as a member of the Board of Chosen Freeholders for Morris County, and while in office he saw to it that the county procured three competitive bids for all contracts, that county officials were barred from receiving gifts from individuals and firms with which the county did business, and that expenditures and taxes were cut. But when he sought the nomination of the Republican Party for a seat in the New Jersey Assembly, his opponent in the primary won handily, and, even more telling, the same thing happened when he sought re-election to the Board of Chosen Freeholders. In his first foray into politics, Christie had evidently ruffled feathers within his own party. Ten years ago, it looked as if his political career was over, and he was working as a lobbyist for his old law firm.

This would probably have been the end of the story had Christie not gone all-out in raising money for the presidential campaign of George W. Bush in 2000 – which won him the attention and gratitude, some say, of Karl Rove and an appointment in December, 2001 as U. S. Attorney for the District of New Jersey. It was in that office that he first distinguished himself.

When Christie received the appointment, there was grumbling in the New Jersey law establishment. He had no experience in criminal law, and he was not one of the more prominent lawyers in the state. But Christie quickly silenced his critics. In his seven years as U. S. Attorney, he and the 137 lawyers working under his direction managed to convict or elicit guilty pleas from 130 public officials, drawn from both parties at every level of government, without losing a single case. For the first time in his life, Christie had the opportunity to show what he could do, and the toughness, impatience, and intolerance for corruption that had so annoyed the Republican establishment in Morris County served him well in his new post.

In hindsight, it is probably a good thing that Christie was not elected to the New Jersey Assembly. He is not your run-of-the-mill team player. One cannot imagine him joining a church for political reasons, marrying a woman connected to a political machine, voting present in the assembly on controversial bills, and sucking up to his party’s leader in that body in the hope of having his name put on a series of bills designed to make him look good to the public statewide.

In ordinary circumstances, Chris Christie would not have been elected Governor. To begin with, the state of New Jersey is a Democratic stronghold. But, more to the point, Christie is anything but smooth, and his demeanor is not comforting. He is big. Let’s face it: he is fat. He is loud, and he is combative, and the Republicans would not, in any ordinary year, have nominated the man. A patrician like Christie Whitman he is not.

In the circumstances, however, these qualities served him well – for, in 2009, New Jersey, like Louisiana before Bobby Jindal took over, was a godawful mess: profoundly corrupt, inefficient, overtaxed, and on the verge of bankruptcy. Moreover, the incumbent was in bed (and not just metaphorically) with the public service unions responsible for bringing the state to the edge of an abyss

Furthermore, New Jerseyans are not by and large smoothies. There is a blue-collar feel to much of the state; the Italians, the Irish, and the Greeks are everywhere to be seen; and they have not forgotten whence they came. After four years of being governed by a slick sleazeball from Goldman Sachs, New Jerseyans regarded a rough customer like Christie as a breath of fresh air.

Under the terms of the various state constitutions in this country, the governorships vary considerably. In some states – Arkansas and Texas come to mind– the governor has very little leverage. In others, the governor has a great deal of patronage to dispense and considerable legal authority. When he became Governor of New Jersey on 19 January, Christie inherited what may be the strongest gubernatorial office under any state constitution in America, and from day one he demonstrated that he was more than willing to use the power that was his to the fullest.

New Jersey is what the United States threatens to become – a failed state. It is wealthy; the public-sector unions are powerful; and the taxes are so high that wealthy individuals have begun moving elsewhere in large numbers and the tax base has begun eroding. Christie grasps the significance of this and from the outset he made no bones of the fact that he intended to cut expenses, balance the budget, lower taxes, and make the state once again a desirable place in which to set up and operate a business. He has shown vigor, energy, and dispatch, and in speeches throughout the state (such as the one he gave at Perth Amboy embedded in this post) he has talked turkey to the people of New Jersey.

In a country presided over by a proficient liar, there is nothing like being told the unvarnished truth. Go to YouTube. Look at all the videos Christie has posted there; review the speech President Obama gave from the Oval Office last Monday regarding the oil spill in the Gulf; and you will see the difference between a genuine executive and someone temperamentally unfit for the job.

I cannot say whether Chris Christie is presidential timber. The jury is still out on his tenure as Governor of New Jersey. But I can say one thing. The qualities that he has demonstrated in his short time as Governor are qualities that will be required of the next President of the United States.

In a June 14th editorial entitled “Politicizing the Fed,” the Wall Street Journal sheds light on one of the dubious regulations of the upcoming financial reform bill.  The Journal states:

The biggest underreported threat comes from Subtitle I, Section 1801 of the House financial reform bill titled “Inclusion of Minorities and Women; Diversity in Agency Workforce.” Sponsored by California Democrat Maxine Waters, the provision requires each federal financial agency, the Fed Board of Governors and the 12 regional Fed banks to “establish an Office of Minority and Women Inclusion.”

So what else is new, you say? Don’t the feds already dictate racial and gender hiring? Yes, they do, through the Equal Employment Opportunity Commission and assorted other federal laws. As a matter of racial and gender diversity, the Waters provision is at best redundant.

But Ms. Waters and the House are hunting bigger game—to wit, the political allocation of credit.

[...]

The House provision makes that very clear by making each diversity officer a Presidential appointee who must be confirmed by the Senate.The post, says the bill, will be “comparable to that of other senior level staff.”  The post, says the bill, will be “comparable to that of other senior level staff.”

The law says this diversity czar will “ensure equal employment opportunity and the racial, ethnic and gender diversity” of the work force and senior management of these institutions. More ominously, this creature of Congress and the White House will also be charged with “increas[ing] the participation of minority-owned and women-owned businesses in the programs and contracts” of each agency and conducting “an assessment” of stated inclusion goals.

Mull over that one for a minute. Having recently lived through a financial mania and panic caused in part by political pressure for “affordable housing,” Congress will now order regulators to allocate credit by race and gender.

In an article I wrote on February 28th entitled “Fiscal Death by Welfare,” I argued: “I believe that as the downturn goes on the government will blame the banks for the lack of economic growth and force them to allocate credit to chosen political entrepreneurs and other bad credit risks…”  I truly wish I had been wrong in my assessment.

Note that this is not to say that minorities or women are bad credit risks, but that based upon prior social engineering experiments in which government has intervened to force lending, we have seen that the worst credit risks are the ones who most benefited at the outset, to the detriment of themselves and all taxpayers at the day of reckoning.

Too, any government forcing of credit necessarily reflects a bad credit risk, because in lieu of government intervention, market actors would already properly allocate credit to anyone, regardless of their race, gender or ethnicity, at an interest rate reflective of their risk profile.  If lenders were to discriminate on the basis of non-economic reasons, than other competitors would see this void and fill it.  This principle is reflected for example in the old days when in response to the so-called WASP investment banks, Jews built their own ones to fill the vacuum of talent being ignored by white-shoe firms.  Private self-interest works in the face of discrimination.  Public self-interest creates discrimination.

Why is forced allocation of credit to certain sectors of society harmful?  Forced allocation of credit means mispricing of credit which leads to market distortions that manifest into bubbles and crashes.

Interest rates are supposed to reflect the risk profile of the borrower.  Lenders assess the ability of a borrower to pay back a loan and determine a proper compensatory rate based upon the opportunity cost and risk involved with leaving the cash with such a borrower over a period of time.  The government by forcing the allocation of credit will not only distort the market mechanism which best coordinates lending and borrowing activity in all sectors of the economy, largely to the detriment of the most creditworthy debtors, but also artificially cheapen the cost of credit for the least creditworthy of debtors by increasing the supply of available credit to them.

In effect, the government will seek to deny the truth reflected in higher interest rates for more risky borrowers by dropping their rates by fiat.  Since better credit risks will have to pay higher interest rates due to such diversion of capital, this will have a doubly negative effect on the worse credit risks who would benefit from the likely more successful economic activity of the more creditworthy borrowers.

The notion that interest rates must be kept low — that we should lie by suppressing the price of credit because it reflects truths we do not want to acknowledge is not limited to the central planning writers of the financial reform bill.

In Ben Bernanke, the chief financial central planner’s most recent performance in front of the House Budget Committee, he echoed this argument, noting that we must keep interest rates low — that we must stop the price of interest from reflecting reality or we will risk facing the consequences of reality.  This of course is how he arrives at the supposed panacea of an interest rate of 0-.25%.

We have government at every level that is bankrupt, hundreds of under-capitalized banks with toxic assets on their books and an economy that is being hyper-regulated to death and facing increasing onerous taxes direct and indirect, and yet the benchmark cost of borrowing money, to which all other interest rates are connected is 0%.  Utter insanity.  Almost as insane as giving a body like the Fed the ability to fix such a price, as if a single human being or board of human beings could pick the price of anything, be it credit or bananas.  Obama, Bernanke & Co. would rather wage a war on truth and centrally plan than go home and let prices reflect reality.

Another aspect to the denial of truth in the economy deals with the abandonment of “mark-to-market” pricing.  If banks were to have to price assets on their books based upon what they could reasonably expect to obtain in the market for those assets, many of them would be in serious trouble.  Yet instead, because we have suspended mark-to-market pricing, and forced taxpayers to pump capital into our banks, their balance sheets appear to be healthy.  Hence the new normal in our economy of “extend and pretend,” where we throw lifelines at banks and failing enterprises by providing them with cheap capital, and pray that their now hidden underlying problems will go away, knowing that they will not only not go away but grow larger until some unknown dark point in the future when the cancer kills the host.

When it comes to unemployment too, we see an administration not only denying truth but flat out lying, laughably arguing that we are creating jobs.  Leave aside the fact that the more honest measure of unemployment, U6 shows unemployment at much closer to Depression levels.  The bottom line is that a government job, the only kind we are creating, is not an economically beneficial job, the caveat being the jobs of those who defend us and keep us safe who are necessary to maintain the peace that allows our economy to function.  Even there, I doubt anyone would argue that in a world without foreign enemies, maintaining a military would be anything more than a diversion of funds.

In any event, the private sector creates jobs in response to the demand of consumers.  Sovereign individuals dictate what sectors should grow and what sectors should contract based upon their needs.  Government does not meet any such demand.  It can only take resources away from the private sector and allocate land, labor and capital based upon political, not economic factors that in a capitalist economy, individuals would make to drive economic activity.  The government in depriving individuals and enterprises of such economic resources will only stifle recovery, immorally attempting to play the role of the omnipotent master of consumers and producers.  The government will destroy jobs by “creating jobs.”

Note too that the underlying argument that people are not consuming enough, and that thus we need such boondoggles as cash-for-clunkers and HAMP further denies truth.  How is a government to know what is the proper amount of consumption?  Why is the government to stop individuals from choosing to consume less?  Why is government to take resources from people and consume more if individuals choose to consume less?

We overconsumed (as reflected in the unjustified rise and subsequent crash in asset prices) precisely because we were misled by gobs of artificially cheap credit, so now we need to force people to consume even more and make credit even cheaper?  NO!  Now we need to contract — consume less and save and invest more.  Saving and investment means foregoing consumption today to consume more tomorrow.  But if interest rates are artificially suppressed, disincentivizing saving, all we will do is perpetuate existing stagnancy.

Most recently, with regard to BP, President Obama is trying to use the disaster to argue that drilling for oil is bad, and that thus we need to use public money to push all sorts of green initiatives like windmills and solar energy.  Forget that BP was forced to drill so deep underwater because of all of the environmental regulations we have in place that prevent us from tapping much more easily usable sources of oil.  Forget that the baby-killers at BP are losing billions of dollars, again as a result of this policy, while you demonize them as if they intentionally caused this disaster.  Forget that alternative sources of energy are nowhere near being perfected, nor are they yet economical, which is why the private sector is not pushing all of its resources toward such development.

When you are the central-planner-in-chief you know better than your serfs.  You can deny all truth and continue to push your intentionally destructive policies, claiming that existing notions of individual liberty, property rights and true equality before the law are antiquated and immoral.

But in reality, President Obama’s economic policy of denying truth merely divides and favors certain classes of people over others and compounds and prolongs our problems.  Obama seeks to supplant with the decisions of divine bureaucrats the decisions of millions of individuals partaking in mutually beneficial actions to the good of the whole world.

This administration completely perverts truth, justice and morality in their grab for greater control over you and I.  Most importantly, this administration forgets the fundamental truth that man is flawed and thus cannot be G-d.  What could be more dangerous and immoral than a policy which stems from such a hubristic and fallacious principle?

In a June 14th editorial entitled “Politicizing the Fed,” the Wall Street Journal sheds light on one of the dubious regulations of the upcoming financial reform bill.  The Journal states:

The biggest underreported threat comes from Subtitle I, Section 1801 of the House financial reform bill titled “Inclusion of Minorities and Women; Diversity in Agency Workforce.” Sponsored by California Democrat Maxine Waters, the provision requires each federal financial agency, the Fed Board of Governors and the 12 regional Fed banks to “establish an Office of Minority and Women Inclusion.”

So what else is new, you say? Don’t the feds already dictate racial and gender hiring? Yes, they do, through the Equal Employment Opportunity Commission and assorted other federal laws. As a matter of racial and gender diversity, the Waters provision is at best redundant.

But Ms. Waters and the House are hunting bigger game—to wit, the political allocation of credit.

[...]

The House provision makes that very clear by making each diversity officer a Presidential appointee who must be confirmed by the Senate.The post, says the bill, will be “comparable to that of other senior level staff.”  The post, says the bill, will be “comparable to that of other senior level staff.”

The law says this diversity czar will “ensure equal employment opportunity and the racial, ethnic and gender diversity” of the work force and senior management of these institutions. More ominously, this creature of Congress and the White House will also be charged with “increas[ing] the participation of minority-owned and women-owned businesses in the programs and contracts” of each agency and conducting “an assessment” of stated inclusion goals.

Mull over that one for a minute. Having recently lived through a financial mania and panic caused in part by political pressure for “affordable housing,” Congress will now order regulators to allocate credit by race and gender.

In an article I wrote on February 28th entitled “Fiscal Death by Welfare,” I argued: “I believe that as the downturn goes on the government will blame the banks for the lack of economic growth and force them to allocate credit to chosen political entrepreneurs and other bad credit risks…”  I truly wish I had been wrong in my assessment.

Note that this is not to say that minorities or women are bad credit risks, but that based upon prior social engineering experiments in which government has intervened to force lending, we have seen that the worst credit risks are the ones who most benefited at the outset, to the detriment of themselves and all taxpayers at the day of reckoning.

Too, any government forcing of credit necessarily reflects a bad credit risk, because in lieu of government intervention, market actors would already properly allocate credit to anyone, regardless of their race, gender or ethnicity, at an interest rate reflective of their risk profile.  If lenders were to discriminate on the basis of non-economic reasons, than other competitors would see this void and fill it.  This principle is reflected for example in the old days when in response to the so-called WASP investment banks, Jews built their own ones to fill the vacuum of talent being ignored by white-shoe firms.  Private self-interest works in the face of discrimination.  Public self-interest creates discrimination.

Why is forced allocation of credit to certain sectors of society harmful?  Forced allocation of credit means mispricing of credit which leads to market distortions that manifest into bubbles and crashes.

Interest rates are supposed to reflect the risk profile of the borrower.  Lenders assess the ability of a borrower to pay back a loan and determine a proper compensatory rate based upon the opportunity cost and risk involved with leaving the cash with such a borrower over a period of time.  The government by forcing the allocation of credit will not only distort the market mechanism which best coordinates lending and borrowing activity in all sectors of the economy, largely to the detriment of the most creditworthy debtors, but also artificially cheapen the cost of credit for the least creditworthy of debtors by increasing the supply of available credit to them.

In effect, the government will seek to deny the truth reflected in higher interest rates for more risky borrowers by dropping their rates by fiat.  Since better credit risks will have to pay higher interest rates due to such diversion of capital, this will have a doubly negative effect on the worse credit risks who would benefit from the likely more successful economic activity of the more creditworthy borrowers.

The notion that interest rates must be kept low — that we should lie by suppressing the price of credit because it reflects truths we do not want to acknowledge is not limited to the central planning writers of the financial reform bill.

In Ben Bernanke, the chief financial central planner’s most recent performance in front of the House Budget Committee, he echoed this argument, noting that we must keep interest rates low — that we must stop the price of interest from reflecting reality or we will risk facing the consequences of reality.  This of course is how he arrives at the supposed panacea of an interest rate of 0-.25%.

We have government at every level that is bankrupt, hundreds of under-capitalized banks with toxic assets on their books and an economy that is being hyper-regulated to death and facing increasing onerous taxes direct and indirect, and yet the benchmark cost of borrowing money, to which all other interest rates are connected is 0%.  Utter insanity.  Almost as insane as giving a body like the Fed the ability to fix such a price, as if a single human being or board of human beings could pick the price of anything, be it credit or bananas.  Obama, Bernanke & Co. would rather wage a war on truth and centrally plan than go home and let prices reflect reality.

Another aspect to the denial of truth in the economy deals with the abandonment of “mark-to-market” pricing.  If banks were to have to price assets on their books based upon what they could reasonably expect to obtain in the market for those assets, many of them would be in serious trouble.  Yet instead, because we have suspended mark-to-market pricing, and forced taxpayers to pump capital into our banks, their balance sheets appear to be healthy.  Hence the new normal in our economy of “extend and pretend,” where we throw lifelines at banks and failing enterprises by providing them with cheap capital, and pray that their now hidden underlying problems will go away, knowing that they will not only not go away but grow larger until some unknown dark point in the future when the cancer kills the host.

When it comes to unemployment too, we see an administration not only denying truth but flat out lying, laughably arguing that we are creating jobs.  Leave aside the fact that the more honest measure of unemployment, U6 shows unemployment at much closer to Depression levels.  The bottom line is that a government job, the only kind we are creating, is not an economically beneficial job, the caveat being the jobs of those who defend us and keep us safe who are necessary to maintain the peace that allows our economy to function.  Even there, I doubt anyone would argue that in a world without foreign enemies, maintaining a military would be anything more than a diversion of funds.

In any event, the private sector creates jobs in response to the demand of consumers.  Sovereign individuals dictate what sectors should grow and what sectors should contract based upon their needs.  Government does not meet any such demand.  It can only take resources away from the private sector and allocate land, labor and capital based upon political, not economic factors that in a capitalist economy, individuals would make to drive economic activity.  The government in depriving individuals and enterprises of such economic resources will only stifle recovery, immorally attempting to play the role of the omnipotent master of consumers and producers.  The government will destroy jobs by “creating jobs.”

Note too that the underlying argument that people are not consuming enough, and that thus we need such boondoggles as cash-for-clunkers and HAMP further denies truth.  How is a government to know what is the proper amount of consumption?  Why is the government to stop individuals from choosing to consume less?  Why is government to take resources from people and consume more if individuals choose to consume less?

We overconsumed (as reflected in the unjustified rise and subsequent crash in asset prices) precisely because we were misled by gobs of artificially cheap credit, so now we need to force people to consume even more and make credit even cheaper?  NO!  Now we need to contract — consume less and save and invest more.  Saving and investment means foregoing consumption today to consume more tomorrow.  But if interest rates are artificially suppressed, disincentivizing saving, all we will do is perpetuate existing stagnancy.

Most recently, with regard to BP, President Obama is trying to use the disaster to argue that drilling for oil is bad, and that thus we need to use public money to push all sorts of green initiatives like windmills and solar energy.  Forget that BP was forced to drill so deep underwater because of all of the environmental regulations we have in place that prevent us from tapping much more easily usable sources of oil.  Forget that the baby-killers at BP are losing billions of dollars, again as a result of this policy, while you demonize them as if they intentionally caused this disaster.  Forget that alternative sources of energy are nowhere near being perfected, nor are they yet economical, which is why the private sector is not pushing all of its resources toward such development.

When you are the central-planner-in-chief you know better than your serfs.  You can deny all truth and continue to push your intentionally destructive policies, claiming that existing notions of individual liberty, property rights and true equality before the law are antiquated and immoral.

But in reality, President Obama’s economic policy of denying truth merely divides and favors certain classes of people over others and compounds and prolongs our problems.  Obama seeks to supplant with the decisions of divine bureaucrats the decisions of millions of individuals partaking in mutually beneficial actions to the good of the whole world.

This administration completely perverts truth, justice and morality in their grab for greater control over you and I.  Most importantly, this administration forgets the fundamental truth that man is flawed and thus cannot be G-d.  What could be more dangerous and immoral than a policy which stems from such a hubristic and fallacious principle?

While the “March Madness” that resulted in the passage of the Patient Protection and Affordability Care Act of 2010 would lead you to believe that STAT change was needed in our health care system, the on-going delay in the “fix” to the SGR (sustainable growth rate) formula for Medicare invokes images of a long waiting list for a rationed medical procedure.

Medicare, the federal government’s health care insurance plan for the elderly and disabled established in 1965, is largely funded from payroll taxes and FICA, and supplemented with premiums paid by its beneficiaries. It is administered by the Department of Health and Human Services via the Centers for Medicare and Medicaid Services (CMS), and is the place to look to see how our government will administer a health care system.

Since 1998, the SGR has been a component of the formula used to calculate physician payments for providing services to Medicare patients. It is based on the GDP and not on actual health care practice costs (which have been rising faster than the GDP.) The SGR produced steep cuts in physician compensation for services to Medicare patients, in hopes that by paying individual physicians less, overall health care cost would decrease.

Unfortunately, this approach has failed.

Pay to physicians caring for Medicare patients has been stagnant, while health care costs have gone up. Many physicians report receiving little net income or are barely breaking even for their care of Medicare patients. Congress has stepped in nine times since 2002 to prevent or reverse increasingly larger Medicare physician payment cuts mandated by the SGR formula. As a contingent of its support for the health care reform passed in March, the American Medical Association demanded that the flawed SGR formula be abolished.

The doctors are still waiting.

Congress had chosen to delay the cuts three times this year, but voted Thursday to allow the 21% cut in physician reimbursement to take effect now. The impact of this will be dramatic. Medicare patients & those working in the medical field are already paying the price for Congress’ inaction. An AMA poll of over 9000 doctors last month revealed that delayed Medicare payments had already caused them to postpone or cancel scheduled services to Medicare patients, while 17% of these doctors report holding up paychecks or laying off their staff – with over 1500 workers affected by this. Physicians also report limiting the numbers of Medicare patients they will see, and some have opted out of Medicare altogether.

One might consider Congress’ inability to resolve the SGR predicament as the “anti-health, anti-stimulus bill.” The cost of using the flawed SGR formula was not factored into the cost of health care reform, and it is not going away. What will go away are doctors willing to care for Medicare patients, despite the promise “if you like your doctor, you can keep him.”

The SGR problem should have been solved before comprehensive health care reform was signed into law.

The Center for Immigration Studies recently put out a study arguing that immigration has had negative effects on California. One of their measures was a comparison of how many people in the state were receiving some form of welfare compared to other states. I found that data (see Table 3 of the report) very interesting, but not because of the immigration debate (I’ll leave others to debate that topic). Instead, I wanted to get a better understanding of the variations in government dependency. Is there a greater willingness to sign up for income redistribution programs, all other things being equal, from one state to another? The “all other things being equal” caveat is very important, of course, since the comparison produced by CIS may simply be an indirect measure of the factors that determine welfare eligibility. One obvious (albeit crude) way of addressing this problem is to subtract each state’s poverty rate to get a measure of how many non-poor people are signed up for income-redistribution programs. Let’s call this the Moocher Index.

A few quick observations. Why is Vermont (by far) the state with the largest proportion of non-poor people signed up for welfare programs? I have no idea, but maybe this explains why they elect people like Bernie Sanders. But it’s not just Vermont. Four of the top five states on the Moocher Index are from the Northeast, as are six of the top nine. Mississippi also scores poorly, coming in second, but many other southern states do well. Indeed, if we reversed the ranking and did a Self-Reliance Index, Virginia, Florida, and Georgia would score in the top 10. Nevada, arguably the nation’s most libertarian state, is the state with the lowest number of non-poor people signed up for welfare.

Let’s now emphasize several caveats.

I’m not an expert on the mechanics of social welfare programs, but even I know that eligibility is not governed solely by the poverty rate. Indeed, some welfare programs are open to people with much higher levels of income. This means that a more thorough analysis at the very least would have to include some measure of income distribution by state. Moreover, states use different formulas for Medicaid eligibility, so this index ideally also would be adjusted for state-specific policies that make it easier or harder for people to become dependent. There also are some states (and even colleges) that actually try to lure people into signing up for welfare, which also might affect the results. And I’m sure there are many other factors that are important, including perhaps immigration. If anybody knows of most substantive research in this area, please don’t hesitate to share material.

For far too long, Americans have watched as the Democrat Majority in Washington has made promise after promise that they would responsibly manage the taxpayer’s dollars – but one promise we haven’t seen many members keep is to take action to reduce our ever exploding deficit by actually cutting wasteful spending.

Many Americans have lost their jobs or have seen their pay and benefits reduced. Our nation’s families and small business job providers are all tightening their belts – all while they look at what’s happening in Washington in disbelief.

Spending is out-of-control. We have a national debt over $13 trillion; an annual budget deficit of nearly $1.6 trillion; and within the first eight months of our current fiscal year, the federal government has accumulated $935 billion in deficit spending. Currently, we are right on track to meet last year’s annual deficit record of $1.4 trillion. American taxpayers want spending reduced.

That is why Republican Whip Eric Cantor and the House Republicans have launched the YouCut project – where we go over the heads of Nancy Pelosi and her allies in Congress to engage the American people in the effort to reduce the deficit and cut wasteful spending now.

YouCut gives Americans the opportunity to vote each week for one of five wasteful spending programs and Republicans will force a vote on the one receiving the most votes. As of this week, Americans have casted over 850,000 votes on YouCut programs.

So far, Americans have asked House Republicans to push for a vote on a proposal to sell excess federal property, saving taxpayers up to $15 billion; a vote to reform Fannie Mae and Freddie Mac, which would generate over $30 billion in savings for taxpayers; a vote on a spending cut to eliminate the proposed federal employee pay raise that would have saved hard pressed American families $2 billion this year and nearly $30 billion over 10 years; and a spending cut that would have saved $2.5 billion a year and not undue reforms that will weaken our welfare program.

We can all agree that this is not too much to ask for our government to stop spending money that we do not have, while families across the nation are facing many financial challenges.

Since we started this effort the Democrat Majority has voted down each attempt to reduce spending, but we are forcing change. Democrat leaders in Congress are now scrambling to try and find cuts that they can support. If we force cuts, YouCut will have been a great success. But the Democrats will never cut spending if we don’t keep up the pressure.

I encourage every American citizen to go to the YouCut website and make your voice heard in Congress and help get some fiscal sanity back in Washington today.

We must focus on what we can do to cut spending today, because every day we wait billions of dollars in new debt are passed along to our children and grandchildren. YouCut gives the American people a chance to say enough is enough.

In politics, temperament matters – it matters a great deal, as Barack Obama has unwittingly shown us time and again.

Some women and men love to posture, talk, debate, and negotiate. Temperamentally, they are suited for a legislative role. It is said – only partly in jest– that, in Washington, DC, the most dangerous space to occupy is that which lies between a United States Senator and a microphone.

Other women and men – think of Winston Churchill, Margaret Thatcher, Indira Ghandi, Golda Meir, and Ronald Reagan – were born to take charge. When Harry Truman put a sign on his desk, reading, “The buck stops here,” he knew what he was talking about. As Alexander Hamilton observed in The Federalist, it is vital that we have in our Constitution a unitary executive because, in human affairs, emergencies are commonplace; secrecy, vigor, and dispatch are often requisite; and, in such circumstances, there has to be someone in high office able, willing, and even eager to take responsibility for the conduct of affairs.

Americans have an instinctive understanding of what is at stake. Ordinarily, they choose as Presidents men with executive experience – men with a track record in directing affairs that can be judged. George Washington, Andrew Jackson, William Henry Harrison, Zachary Taylor, Ulysses S. Grant, and Dwight D. Eisenhower had been prominent generals before they were elected Presidents, and Rutherford B. Hayes, James A. Garfield, Benjamin Harrison, and Theodore Roosevelt had also demonstrated an aptitude for leadership in war.

John Adams, Thomas Jefferson, Martin Van Buren, the younger Roosevelt, Harry Truman, Lyndon Baines Johnson, Richard Nixon, and George H. W. Bush had held the vice-presidency. Jefferson and Van Buren had also been Secretary of State, and the same can be said for James Madison, James Monroe, John Quincy Adams, and James Buchanan. Monroe had also been Secretary of War, and this was true was well for William Howard Taft. Herbert Hoover had managed relief efforts in Europe early in and after World War I; he had served as Food Administrator within the United States after we entered that war; and, from 1921 to 1928, he served as Secretary of Commerce.

Many of the others elected to the presidency had previously held gubernatorial office.

This was true for Jefferson, Monroe, Van Buren, the younger Roosevelt, and, if one counts his service as governor of the Philippines, for Taft as well. It applies also to James K. Polk, Rutherford B. Hayes, Grover Cleveland, William McKinley, Woodrow Wilson, Calvin Coolidge, Franklin Delano Roosevelt, Ronald Reagan, Jimmy Carter, William Jefferson Clinton, and George H. Bush.

The only men ever elected to the presidency who had no executive experience of any sort were Franklin Pierce, Warren G. Harding, John F. Kennedy, and the hapless incumbent we have today.

No one – not even, in retrospect, his own political party – thought that Pierce did a decent job. It was during his administration (1853-1857) that the Union began to come apart. Harding is best remembered for the scandals that beset his short-lived administration (1921-1923). And although, thanks to the slavish devotion of his acolytes in the media and in the academy, JFK is in some circles revered, his actual performance in office prior to October, 1962 was deplorable. As Donald Kagan pointed out on the occasion of the 50th anniversary of the construction of the Berlin Wall Kennedy was so weak, so irresolute and indecisive, so feckless in his dealings with the Soviet Union that his conduct encouraged Nikita Khrushchev to think that he could get away with introducing missiles tipped with nuclear warheads into Castro’s Cuba and brought us thereby to the brink of nuclear war.

Executive experience does not guarantee wisdom and competence in office. Pierce, Harding, and Kennedy were by no means the only elected Presidents to fall short. But, as the American people generally appreciate, the lack of executive experience is a good indicator of fecklessness to come.

Witness Barack Obama. Leave aside his first year in office. As I pointed out in posts entitled “Barack Obama and the Exhausted Presidency” and “Obama’s First Year,” from the outset, he conducted himself in an irresponsible fashion that is highly unpresidential.

He forgot that, in the larger world, the President represents his country. Out of personal pique, he persistently insulted our friends abroad, displaying disdain for Gordon Brown, stiffing Nicholas Sarkozy and Angela Merkel, treating Benyamin Netanyahu with open contempt, and turning his back on the people of Poland, Czechoslovakia, and Iran. At the same time, he embraced Hugo Chavez, sucked up to Vladimir Putin, and kowtowed to the rulers of Saudi Arabia and China – all to no avail.

With regard to domestic affairs, he seems not to have recognized that, under our Constitution, it is the President of the United States who represents the national interest; that Congressmen more often than not cater to particular interests; that, if legislation is left to the latter, principle tends to give way to patronage; and that the result can be a profound embarrassment. And so he stood idly by while Nancy Pelosi, Harry Reid, and the like drafted legislation – a so-called “stimulus bill” and healthcare reform, each more than a thousand pages in length, each embodying a multitude of corrupt bargains, each threatening to bankrupt the country. And, like a political hack, faithful to his party to the bitter end, he promoted and signed their handiwork.

All of this was obvious long ago, and it was evident as well that, if there were a real crisis, he would check out. This is what he did when Major Nidal Malik Hassan gunned down thirteen Americans at Fort Hood. This is what he did when Umar Farouk Abdulmutallab nearly brought down a jetliner at Christmas time. And this is what he did when Faisal Shahzad was found to have planted a bomb in Times Square. All three cases revealed an egregious failure of our intelligence apparatus. In all three cases, the danger had its source in developments within Islam And, in the face of all of this, the President of the United States signaled that he could hardly bear to take a few minutes off from his vacation at the beach in Hawaii, cancel a party or two, or give up his golf game to acknowledge and address the failures of his administration, and at no time has he been willing to level with us about the source of our peril.

Maureen Dowd and those who think that politics is about play-acting – here is her latest column on this theme – lament that, like Spock in Star Trek, No-Drama Obama is simply incapable of displaying any sense of urgency. The real problem is much more serious, for our well-being is to a considerable degree in this man’s hands, and, when things go wrong, he seems not to feel any sense of urgency at all.

The oil spill that began in the Gulf of Mexico on 20 April is the latest example. Some say that President Obama is no more responsible for the spill than President Bush was for Hurricane Katrina. This claim is, in fact, untrue. Bush had nothing to do with Katrina. Barack Obama, as President, was responsible for insuring that the regulatory agencies overseeing the drilling operations did their job properly. While campaigning for the presidency, he charged that the Bush administration had, in effect, allowed the oil industry to regulate itself, and he promised that, if he were elected, he would set things right. During that campaign, he took a wad of cash from folks at BP (more than they had ever given any other candidate); and, when the time came to reform the Minerals Management Service, as Tim Dickinson has shown in fine detail in the latest issue of Rolling Stone, the new administration’s appointees did nothing of the sort.

Nor was the Obama administration quick off the mark in doing what could be done to contain the spill. Instead, while the govenors in the Gulf states clamored for action, the President played golf and partied and the bureaucracy dithered, delaying by weeks efforts to prevent the oil from coming ashore, from fouling beaches, and killing wildlife. Nearly two months have passed since the accident on the Deepwater Horizon, and to date President Obama has issued no waiver to the Jones Act, which stands in the way of foreign ships with foreign crews helping to contain and suck up the spill.

The environmentalists are reportedly giving the Obama adminstration a pass. By now, they are reliable partisans, and they have their eye on cap-and-trade. The people of Louisiana are much less happy. They recognize the deepwater drilling moratorium imposed by the Obama administration for what it is – a ploy designed to persuade those not in the know that something decisive is being done – and, according to the left-liberal outfit Public Policy Polling, more than three-quarters of the voters in that state still favor offshore drilling. Moreover, half of the voters polled “think George W. Bush did a better job with Katrina than Obama’s done dealing with the spill,” 31% of self-described Democrats agree, and only 35% of those polled give Obama higher marks.

Only one politician has gained ground in the course of this crisis, and that is Bobby Jindal, the Governor of Louisiana. The poll recently taken shows that “63% of voters approve of the job he’s doing,” which is the highest approval rating that Public Policy Polling “has found for any Senator or Governor so far in 2010. There’s an even higher level of support, at 65%, for how he’s handled the aftermath of the spill.” Jindal is evidently a man of executive temperament. He is not better placed to deal with the spill than is Barack Obama, but he has done as much to keep it off the beaches and out of the swamplands of southern Louisiana as lay within his power.

As the reports make abundantly clear, Barack Obama did not help himself at all with the speech he gave on Monday night from the Oval Office. As our President plays golf, parties, and pauses from time to time to bloviate and pose for photo-ops, his popularity steadily sinks under the weight of his evident indifference to our security and well-being.

It is high time that Republicans start asking the obvious question: who, in their number, is best prepared to do what this presidential incumbent has no desire to bother with: to take what the authors of The Federalist called responsibility. Governor Jindal may not be at the very top of the list of possible presidential contenders, but he is certainly high on it.

Putting aside for a second the fact that this speech was given about 50 days late, last night’s oval office speech proved that the President is not ready to be honest with the American people.  For the first 30 days of this crisis, President Obama was ignoring the fact that the crisis existed, and now when he uses the oval office to give the people confidence that he is on top of the problem  he spends more time trying to sell cap and trade than discussing capping the well. Essentially, he is still ignoring the crisis.

Lets take a look at the key points of the President’s speech. He begins by trying to convince America that he has been doing a great job at managing the disaster:

“… I assembled a team of our nation’s best scientists and engineers to tackle this challenge – a team led by Dr. Steven Chu, a Nobel Prize-winning physicist and our nation’s Secretary of Energy. Scientists at our national labs and experts from academia and other oil companies have also provided ideas and advice.”

Nobel prizes have not been impressive since  Obama recived one for doing nothing and Al Gore got one for a hoax.  The key is how the ideas from those great minds are implemented. The President’s management of the crisis has been horrible.  Even the progressive bible  the NY Times trashed Obama’s  management of the crisis:

“The information is not flowing,” Senator Nelson said. “The decisions are not timely. The resources are not produced. And as a result, you have a big mess, with no command and control.”

In other words,  the leadership and management coming from the executive branch of the government has been a disaster.

“Because of our efforts, millions of gallons of oil have already been removed from the water through burning, skimming, and other collection methods. Over five and a half million feet of boom has been laid across the water to block and absorb the approaching oil. We have approved the construction of new barrier islands in Louisiana to try and stop the oil before it reaches the shore, and we are working with Alabama, Mississippi, and Florida to implement creative approaches to their unique coastlines.”

A little truth Mr. President?  Only after Bobby Jindal said he was going to build the barrier islands whether they were approved or not, was the barrier island  plan approved.

The  President might have come clean and told us  why the United States refused to accept skimmers from the Dutch, or help from any other country. Maybe he could have explained  why miles of oil boom remain in a Maine warehouse despite the fact that the administration was informed of the supply the third week of May.

“… Tomorrow, I will meet with the chairman of BP and inform him that he is to set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company’s recklessness. And this fund will not be controlled by BP. In order to ensure that all legitimate claims are paid out in a fair and timely manner, the account must and will be administered by an independent, third party.”

While most people would agree that  BP should be paying  for the damage it caused, (BP has promised that it will),  there is no place in the constitution saying that the President has the power to demand a company set aside money in an escrow account? Nor is there a place saying  the POTUS can demand that the account be administered by a third party.  To be honest that clause could be hiding  right next to the clause saying  the government can force citizens to purchase health insurance.

The  demand for BP to freeze money in an escrow account shows a lack of understanding of capitalism. Not allowing BP to spend those dollars on growing its business is limiting the company’s ability to generate the profits  necessary to pay its obligation to the victims of the disaster.

“… Already, I have issued a six-month moratorium on deepwater drilling. I know this creates difficulty for the people who work on these rigs, but for the sake of their safety, and for the sake of the entire region, we need to know the facts before we allow deepwater drilling to continue.”

The drilling freeze is like closing down GM the first time one of its cars is involved in an accident.  Wood Mackenzie Research and Consulting published a report saying the six month moratorium will result in job losses of over 120,000 by 2014. The gulf region is already suffering, as is the American economy, the embargo does nothing but make it worse.

“One place we have already begun to take action is at the agency in charge of regulating drilling and issuing permits, known as the Minerals Management Service. Over the last decade, this agency has become emblematic of a failed philosophy that views all regulation with hostility – a philosophy that says corporations should be allowed to play by their own rules and police themselves. At this agency, industry insiders were put in charge of industry oversight. Oil companies showered regulators with gifts and favors, and were essentially allowed to conduct their own safety inspections and write their own regulations.

When Ken Salazar became my Secretary of the Interior, one of his very first acts was to clean up the worst of the corruption at this agency. But it’s now clear that the problems there ran much deeper, and the pace of reform was just too slow.”

The problem was much worse than the President described.  The Minerals Management Service scandal  broke in September 2008. This crisis did not happen at the beginning of Obama’s administration but  there was a sixteen month window between the inauguration and the oil spill. This was Obama’s problem not Bush’s.

... a larger lesson is that no matter how much we improve our regulation of the industry, drilling for oil these days entails greater risk. After all, oil is a finite resource. We consume more than 20% of the world’s oil, but have less than 2% of the world’s oil reserves. And that’s part of the reason oil companies are drilling a mile beneath the surface of the ocean – because we’re running out of places to drill on land and in shallow water.

Mr President you are lying. A report from the nonpartisan Congressional Research Service (CRS) dated October 2009 proves Obama is lying. The report shows the  amount of  recoverable oil in the U.S. to be 167 billion barrels of oil, not the 21 billion figure pushed by the Democrats.  If exploited that 167 billion barrels could replace America’s  imports from OPEC countries for more than 75 years.

That same report shows that America’s combined recoverable natural gas, oil, and coal supply is the largest on Earth. America’s recoverable resources are far larger than those of Saudi Arabia (3rd), China (4th), and Canada (6th) combined. Those estimates don’t include America’s  immense oil shale deposits.

“The consequences of our inaction are now in plain sight. Countries like China are investing in clean energy jobs and industries that should be here in America. Each day, we send nearly $1 billion of our wealth to foreign countries for their oil. And today, as we look to the Gulf, we see an entire way of life being threatened by a menacing cloud of black crude.”

That’s true. China is investing in clean energy, at the same time they are exploiting every possible opportunity to exploit their own resources.  The United States is funding part of their green job investment with the interest payments from the money that China is loaning us.

If the President and his progressive allies allowed the U.S. to exploit our own resources, there would be no need to  spend that $1 billion on foreign oil.

“...The transition away from fossil fuels will take some time, but over the last year and a half, we have already taken unprecedented action to jumpstart the clean energy industry. As we speak, old factories are reopening to produce wind turbines, people are going back to work installing energy-efficient windows, and small businesses are making solar panels. Consumers are buying more efficient cars and trucks, and families are making their homes more energy-efficient. Scientists and researchers are discovering clean energy technologies that will someday lead to entire new industries.”

Here is the  truth about alternate energy Obama forgets to mention. With the exception of  nuclear energy, no alternate energy has been developed that can run this nation as effectively or efficiently as fossil fuels. Nothing even in the same neighborhood. If the economy is “switched over” before a legitimate alternative is developed, the catastrophically higher prices will collapse the economy.

The President is a recent convert to nuclear power, but not a serious one. He has not allowed the approval process to be streamlined, or a way around the objections of his environmental buddies. So even the one real alternative energy cannot be exploited quickly.

“…Last year, the House of Representatives acted on these principles by passing a strong and comprehensive energy and climate bill – a bill that finally makes clean energy the profitable kind of energy for America’s businesses.

Now, there are costs associated with this transition. And some believe we can’t afford those costs right now. I say we can’t afford not to change how we produce and use energy – because the long-term costs to our economy, our national security, and our environment are far greater.”

The bill passed by the House represents the largest tax increase in American history. It also uses  government regulation  essentially  take over every industry that uses fossil fuel (wait, every industry uses fossil fuel).

More than Obamacare, cap and trade represents a takeover of the American economy, that will retard economic growth, and push the already bankrupt federal budget over the edge.

“Some have suggested raising efficiency standards in our buildings like we did in our cars and trucks. Some believe we should set standards to ensure that more of our electricity comes from wind and solar power. Others wonder why the energy industry only spends a fraction of what the high-tech industry does on research and development – and want to rapidly boost our investments in such research and development.”

And some just want to know where the government is going to get the money? It looks like China will get more US interest payments so they can invest in green energy.

“The same thing was said about our ability to harness the science and technology to land a man safely on the surface of the moon.”

Holy Cow, what an original thought!. “If we can land a man on the moon, why cant we find green energy?” Maybe I can use that line for a future post. I will  have to remember that one.  As I will remember the President’s entire speech.  Who knew that one Obama could fit so much bull into just eighteen minutes. The President may get a slight bump from this, but within a week, the stench of the rotting Presidential bull will drive Americans away from the lies he told tonight.

From New Jersey’s Daily Record:

The Obama Administration handed out more than $400 million in awards to federal employees last year, up by more than $80 million from the prior year, according to new government data.

The biggest winners were air traffic controllers and top managers in Washington, a review of fiscal year 2009 salary reports from the U.S. Office of Personnel Management showed.

OPM’s data, obtained by the Asbury Park Press through a freedom of information request, account for 1.3 million employees, or about 65 percent of the federal civilian work force.

The $408 million given in awards excludes the departments of Defense and Treasury, security agencies such as the CIA and FBI, the White House, Congress and various independent commissions and agencies, such as the U.S. Postal Service.

The defense department paid $92.1 million in awards in 2008, the latest year available. Awards were given to 100,000 of its 687,000 employees.

Continue reading here.

This week, I had the privilege to deliver the Weekly Republican Address.  In it, I talk about how Washington Democrats’ continued failure to end their out-of-control spending spree is scaring the hell out of the American people and hurting our economy.  The need for action could not be clearer: a $13 trillion debt, near-10 percent unemployment, and stagnant private sector growth.  Having run a small business, I can tell you that all this deficit spending, coupled with the new health care law’s burdensome mandates and tax hikes, is crushing these engines of our economy.

As bad as things are, Democrats don’t even intend to pass a budget, doing nothing instead of seizing this critical opportunity to provide the fiscal discipline that is sorely needed to create jobs and boost our economy.   Even after presenting President Obama with a statement signed by more than 100 economists that says just that, he still has not pressed leaders in his own party to take action.  Taxpayers have every right to be fed up with this stunning failure of leadership – the kind of leadership President Obama promised to provide.

These and other topics are discussed in the Weekly Republican Address:

“Hello – I’m John Boehner.  In these tough economic times, American families have done their level best to stay afloat – spending less and working more while trying to map out a financially sound future.  They deserve that same degree of discipline and vigilance from their government.

“But instead of bringing fiscal sanity to Washington like he promised, President Obama has spent taxpayer dollars with reckless abandon, refusing to make tough choices and pushing the burden on to future generations.  No price tag has been too high for Washington Democrats, and now we’re all paying the price.

“Unemployment is still close to 10 percent.  The private sector is at a near-standstill.  Our small businesses are still gasping for air.  And having run a small business, I can tell you that the new health care law, with its burdensome mandates and tax increases, is already stalling these engines of our economy.

“A new report from the Treasury Department shows that our fiscal situation is much worse than we thought.  Our record national debt – which now tops $13 trillion – is on pace to exceed the size of our entire economy by the middle of this decade.   Economists say that at these levels, our debt is draining enough resources from our country to cost us nearly one million jobs.

“We cannot go on like this.

“Real economic growth requires creating jobs in the private sector, and to do that we need to start reining in Washington’s out-of-control spending spree.  Less spending, more jobs – it’s that simple.

“Economists agree, and this week, I gave President Obama a statement signed by more than 100 of them urging both parties to take immediate, decisive action to cut federal spending.

“Unfortunately, Democrats in Congress are busy making backroom deals so that they don’t have to pass a budget this year.  They’d rather keep on spending than seize this critical opportunity to create jobs and boost our economy.  But every family knows that in tough times, passing a budget is more important – not less important.

“Just as troubling is the fact that President Obama hasn’t uttered a word in protest of Congressional Democrats’ failure to produce a budget.   Even after being presented with these economists’ pleas for fiscal discipline, he still won’t press leaders in his own party to fulfill their responsibility to the American people.

“This is a stunning failure of leadership – the kind of leadership President Obama promised to provide.

“Too many in Washington forget that we work for the people, not the other way around.  Taxpayers are just fed up, and they want us to stop spending their hard-earned money.

“That’s why, through the America Speaking Out project, Republicans are providing Americans with a megaphone to make their voices heard and help build a better, more responsive government.  If you have an idea to cut wasteful Washington spending, log on to AmericaSpeakingOut.com right now and start a discussion about it.

“Another interactive Republican initiative – YouCut – gives Americans a chance to vote on specific spending cuts that you want to see Congress implement.  And looking forward, Republicans have proposed common-sense solutions to reform the way Washington spends taxpayer dollars, starting with strict budget caps to limit federal spending on an annual basis.

“Waiting and hoping for the best is no longer an option, not when 43 cents of every dollar we spend this year is borrowed from our kids and grandkids.  Our posterity shouldn’t have to foot the bill because Washington Democrats can’t do what they were elected to do or summon the courage to say no to special interests with their hands out.

“So while I hope President Obama will work with us to stop this spending spree, if he won’t hold Congressional Democrats accountable, then the American people will.

“Thank you for listening.”

New Census data shows the continued trend that the United States is becoming a nation increasingly less white.

According to this latest report, 48.6% of children born in the U.S. between July 2008 and July 2009 were “non-white minorities.” That’s up two percentage points from two years earlier, and soon the figure will cross the 50% mark.

The largest growth demographic is Hispanics, who accounted for almost 55% of our population growth. And, most of this growth – two thirds – came from births, not from immigration.

Aside from the knowledge that the country is becoming more colorful, an obvious thing we’ve got to be thinking about is what this means politically. Given that Democrats have been getting the majority of Hispanic and black votes – the two largest minorities – the straightforward conclusion appears to be that demographic trends favor the Democrat Party.

In the 2008 elections, white voters, for the first time ever, accounted for less than 75% of the total vote. It’s been noted that if each ethnic group voted as it did in 2008, but made of up the same percentage of the electorate as it did 20 years ago, John McCain would be our president today.

Clearly, demographic realities present real challenges to the Republican Party and the values that it is supposed to be championing – limited government and free markets.

Most recent polling from Gallup shows Hispanics generically favoring Democrats over Republicans by 2 to 1.

Republicans have got to make headway with this population.

We need them for building the political consensus to make the critical changes to fix our country – cutting the massive growth in government that Democrats have put in motion, cutting spending to eliminate trillion dollar deficits, reducing our now massive $13 trillion dollar debt, and to come up with creative solutions to the $100 trillion in unfunded liabilities we’re now looking at in our major entitlement programs – Social Security and Medicare. And, of course, holding the line on taxes.

Otherwise stated, if Republicans cannot start pulling in a bigger chunk of this Hispanic vote, it will be tough to be optimistic that we’ll be able to reverse the direction that Democrats have initiated – transformation of our country into a European style social welfare state.

Can Republicans reverse this political trend?

I say yes. The reason is that it is in the interests of our Hispanic citizens to support what Republicans are trying to do.

We’ve got in front of us right now two contrasting snapshots of what America’s future could look like. These two snapshots happen to be our two states with the nation’s largest Hispanic populations. California and Texas.

California today is America’s Greece. Over-governed, over-taxed, over-regulated, over-unionized, with excessive spending and impossible entitlements commitments. If you want to know the path that our federal government is now on, just look at California.

In a recent survey by Chief Executive magazine, CEOs rated California as the worst state in the country for doing business. It is the only state they awarded a grade of “F” in the category of “Taxation and Regulation.”

Over the last year and half, California lost over a million jobs and its overall level of employment is down where it was ten years ago. Its unemployment rate is several points above the national average.

Texas, on the other hand, was rated number one by CEOs. A low tax, low regulation, right-to-work state, unemployment in Texas is several points below the national average. And Texas has had net positive job creation through the recent recession.

Hispanics who think California is model for America’s future can keep voting for Democrats. But my guess is most will prefer the Texas model.

If Republicans make this choice clear to these folks, political change will happen.

The Obama Administration announced that it will urge government agencies to trim five percent from their budgets by reining in wasteful and duplicative programs – and redirect how that money is spent.  Less than 20 minutes later, the Administration’s Budget Chief Peter Orszag admitted that the initiative was as much about spending as it is deficit reduction.  To be clear, the Administration did not commit to use those cuts to pay down the deficits.

Look, trimming these budgets is a good thing – as Republicans have said repeatedly.  But is giving the heads of these agencies the ability to redirect money really an indication that Washington is prepared to bring our deficits under control before the European debt crisis migrates across the Atlantic?  Or is it simply posturing?

The good news is that the administration, at least on the surface, is finally getting the message that the American people are fed up with the reckless culture of spending prevailing over Washington.  America has soured on an agenda that sets out to double the debt in five years and triple it in 10.  That is why we launched YouCut, an effort to begin to transform the culture in Washington from one focused entirely on spending to one that forces measures to cut waste and save money.

Now, after more than 700,000 YouCut votes have been cast to remove specific wasteful spending items in the budget, and three House votes later (that would have saved $85 billion had enough Democrats supported them), the President is beginning to talk about finding ways to save taxpayer money.

To be sure, we welcome the administration’s calls for austerity in government agencies.  We also support the president’s request for new line-item veto authority so that he can remove needless discretionary spending. Yet it’s painfully obvious that these limited measures are woefully inadequate given the scale of our problems. But actions speak louder than words.

The problem with the administration’s “cost-cutting” strategies is that they settle for processes that only theoretically might someday save the taxpayers money. They are a convenient substitute for immediate, material spending cuts that could be implemented right now.  What is the President and his party willing to do TODAY to cut spending?

House Republicans have already brought to the floor roughly $85 billion in direct cuts that would take effect immediately. The savings were the product of the three spending cuts that received the most votes on YouCut during the last three weeks in which Congress met. They include terminating a new $25 billion welfare program that undermines the welfare reform effort of the mid 1990s; discarding a pay raise for federal employees that costs $30 billion; and implementing a reform of government-sponsored bailout behemoths Fannie Mae and Freddie Mac that would return $30 billion to the taxpayers.  By the end of the year, we will have brought hundreds of billions – if not more than a trillion – dollars in spending cuts to the floor.  There will be a public record of who in the House wants to cut spending, and who is blocking it.

Note to President Obama, Speaker Pelosi, and Leader Reid:  The people are watching, actions speak louder than words.  Start cutting spending NOW.  To all of you – please take note of who is trying to cut spending and those who think you aren’t paying attention.

Remember all of those bold statements that the so called “Troubled Assets Relief Program” (TARP), the Bailout of Wall Street Bill, was a one time deal and our federal government should and will never do it again.  Secretary of the Treasury Tim Geithner testified in January of this year before the House Committee on Oversight and Government Reform:

Many Americans look at what happened with AIG, and the rest of the financial rescue, and simply ask:  Why was it necessary?  Why was it fair for the government to take taxpayer money and put it into an institution that had mismanaged itself to the edge of collapse?  The answer is that it was not fair, and it was not something our government should ever have to do.  But those Americans, those families and business owners who played by the rules and played no role in giving rise to this recession, should understand that if the government had failed to act, that failure would have unleashed substantially greater damage upon them.

If TARP “was not fair” and not “something our government should ever have to do,” then why is Congress trying to impose the TARP model on small business?  Congress will consider legislation this week to establish TARP, Jr. for small businesses to be administered and run by none other than Secretary of the Treasury Tim Geithner. The House is considering H.R. 5297, the Small Business Lending Fund Act that provides “temporary authority to the Secretary of the Treasury to make capital investments to eligible institutions in order to increase the availability of credit for small businesses.”

The legislation creates a federally run new bureaucracy called the “Small Business Lending Fund. ”  To qualify a financial institution has to have less than $10 billion in assets and the new creation would have up to $30 billion in new investment authority.  This allegedly temporary program is set up “without further appropriation of fiscal year limitation,” i.e. not temporary, to purchase “preferred stock and other financial instruments” from small business as a means to infuse money into local banks with the condition that they lend to failing small business.  Local banks will be lending in exchange for equity small business, therefore these banks will be using federal monies to buy equity in companies.  This is an idea born from socialism and one that will harm the free market for small business, because failure will be rewarded by federal subsidies while success will be punished.

The bill also creates a “Small Business Credit Initiative” with $2 billion of your tax dollars to be given to states that have created programs to provide funds to banks to bailout small businesses in trouble.  This would provide an incentive for states to adopt the crony capitalism programs of the federal government exemplified by the federal takeover of General Motors and the activities of Fannie Mae and Freddie Mac.  Setting up a system with private profits, yet socialized losses, will diminish capitalism and the American free market system.  This legislation, TARP, Jr., extends the failed and free market offensive TARP model to small business.  Considering that the original TARP program was “not fair, and it was not something our government should ever have to do,” Congress might want to heed the advice of Secretary Geithner of January 2010 and pause before creeping a few more steps toward American socialism.

Greece, Portugal and President Barack Obama have at long last combined to turn the common Washington wisdom about government spending on its head.

Washington insiders insisted for decades that those who say they favor fiscal restraint in the abstract really want more government benefits – regardless of cost. As a result, neither Republicans nor Democrats have made serious attempts to restrain spending.

Republicans usually promise to cut spending but have instead concentrated on keeping taxes low and arguing, not entirely incorrectly, that lower taxes stimulate economic growth and produce more revenue. The problem is that this argument has given Republicans an excuse to talk tough while doing little to fight spending.

Democrats have been even worse. They have simply tended to argue that deficits and debt don’t matter. In the sixties and early seventies the late Hubert Humphrey derided fiscal conservative concerns about growing deficits and debts as irrelevant since “we only owe the money to ourselves.” That was before the Chinese bought up our debt and before interest on the debt threatened to eat up more tax revenues than the Cold War.

Until recently, common wisdom seemed correct. Concern about deficits and debt didn’t show up in polls as viable political concerns and both parties’ politicians spent money to please supporters, buy votes and get their pictures in the paper at the dedication of bridges, highways and monuments to themselves.

All that has changed. Americans are afraid that things have gone too far and that we may be heading for real disaster. The old belief that “it can’t happen here” is being rapidly replaced by a fear that it is happening. This fear is palpable and helps explain the interest in politics this year by men and women who have sat on the sidelines in the past and even may not have voted. This fear morphs into anger against politicians who don’t seem to get it or are dismissed for having contributed to the problem.

As a result, Democrats and Republicans alike are trying to get on the right side of the issue. Blue Dog Democrats who destroyed their fiscal credentials by voting like old yellow dogs for every spending proposal presented to them have resurrected the concept, if not the reality, of a “balanced budget amendment” as a shield against charges that they don’t get it. The president is worried, too — if not about spending itself, at least about the growing public belief that his administration is fiscally irresponsible — and has set up a commission to make recommendations on reducing the debt. Since the debt is only a symptom of the real problem, which is that we are spending far more than we are taking in, reducing it can be done in one of two ways: cutting spending or raising taxes. The president and his party are loath to cut or reduce the growth of spending, so everyone knows how his commission will come down: lip service to spending reduction and real tax increases on the middle-class taxpayers Mr. Obama so recently promised to hold harmless.

Republicans, meanwhile, continue to rail about “earmarks,” which is admirable but won’t solve the overall problem, which stems from a system that has, for as long as anyone can remember, rewarded fiscally irresponsible behavior. This was recognized by important figures in both parties in the waning days of the last century. The result was legislative attempts like Gramm-Rudman-Hollings in 1985 to impose some discipline on the process and proposals to amend the Constitution itself to force Congress to balance the federal budget, except when confronted with a real emergency, and to require a “supermajority” vote to raise taxes.

There were arguments, articles, hearings and objections to any real change. Gramm-Rudman-Hollings was gutted then repealed when Congress feared it might actually make spending money more difficult.

The balanced budget amendment was mugged by spenders of all stripes, but a watered-down version passed the Senate in 1996. Its principal sponsor was the late Paul Simon of Illinois, who in arguing for its passage warned that although the government wasn’t running a deficit that year, he feared what things would look like in 10 years if the amendment were not adopted.

Were he with us today, he would be shocked but not surprised. Fortunately, there are a few in both chambers convinced real reform is possible. Sen. Jim DeMint (R-S.C.) and Rep. Bob Goodlatte (R-Va.) are leading the fight for a new, strong balanced budget amendment — and this time, millions of Americans who didn’t know what the brouhaha was all about in ’96 are hoping they’ll succeed.

This article originally appeared in The Hill.

For most of you, this is old news by now, but I hesitated to report it because it would probably just make you more angry. It recently came out that most of America’s new jobs are temporary Census Bureau positions that will soon end, which is dismal news for the economy. As MyTwoCensus.com observed, some people on the right are outraged by what they report as false job statistics since Census Bureau employees have been hired and let go (for various reasons) and then re-hired to work for other 2010 Census operations down the road.

FoxNews published reports from Commerce Department and Bureau of Labor Statistics spokespersons:

Commerce Department spokesman Nick Kimball:

“The Census Bureau — like all other employers — reports the number of individuals on its payroll for the specific week the Labor Department uses as a point of reference for measuring the nation’s level of This is not a tally of positions filled during the past month — instead, it is the number of actual individual human beings who received paychecks that week. That number can then be compared to the reports from previous months to understand the changing jobs environment over time.”

Bureau of Labor Statistics spokeswoman Stacey Standish:

“Each month the Bureau of Labor Statistics’ (BLS) Current Employment Statistics (CES) program publishes the employment levels for total nonfarm and component industries. Establishments, including the Census Bureau, are asked to report the total number of workers on their payroll. That is, the establishment is asked to report the total number of employees who worked or received pay for the pay period that includes the 12th of the month. The CES program does not ask establishments to report the number of new hires or created, or the number of persons who were laid off.”

Shelly Lowe of the Census Bureau’s public information office commented on a MyTwoCensus post:

First, the Census Bureau does not hire, then fire, and then rehire anyone. Any employee who is fired is fired for cause. We train and hire temporary workers for various operations, most significantly Non-Response Follow-Up (NRFU) to complete work assignments. When the work is complete, the temporary worker goes into an inactive status. They may be re-activated if there is more work to do, or for another subsequent operation. At no time do we count a re-activation from non-working status as a ?rehire.?

The article goes on to state: “Labor doesn’t check the Census hiring figure or whether the jobs are actually new or recycled. It considers a new job to have been created if someone is hired to work at least one hour a month.

This is simply inaccurate. The Census Bureau reports to the Department of Labor and on our public website the number of people paid for work during a given week. We do not report the number of jobs. The Census Bureau reports the total number of unduplicated temporary 2010 workers that earned any pay during a specific weekly pay period. Temporary workers earning any pay during the week are counted only once. The Bureau of Labor Statistics (BLS) measures changes in employment levels — not the actual level itself — and looks only at the week which includes the 12th day of the month. It is simply not possible for Census to engage in the manipulation of data to artificially inflate the employment report of the BLS in the manner alleged by this news column.

So now we see that the number of people on the payroll each week is the number of people who are reported to the government. However, as we know from previous posts and reports by the Commerce Department Inspector General and Government Accountability Office, there are tons and tons of Census Bureau employees who are “trained” each week but never actually work. Furthermore, there are thousands of Census Bureau employees who are only working part-time. Many workers have twenty hours to work per week, tops. These  figures are not accounted for in the Census Bureau’s tally, which are further compounded by the Census Bureau’s frequent IT malfunctions making it such that Census Bureau employees who are on the clock are merely sitting around and waiting for assignments to come through.

Since the early twentieth century, periods of real or perceived national emergency have been “critical episodes” in the growth of government’s size, scope, and power in the United States and in many other countries. Hence, the concise conceptualization: Crisis and Leviathan (the main title of my 1987 book on the growth of government in the United States from the late nineteenth century to the late twentieth century).

In the past century, the first five such critical episodes in the United States were: World War I; the Great Depression; World War II; a multi-faceted set of crises associated with the civil-rights revolution and the Vietnam War, roughly coincident with the presidencies of Lyndon B. Johnson and Richard M. Nixon; and the post 9/11 events associated with the so-called War on Terror and the U.S. attacks on and occupations of Afghanistan and Iraq. We are now amid another such critical episode, which springs from the housing bust that began in 2006, the economic recession that began late in 2007, and the financial debacle that reached its climax in September 2008.

The current troubles are complex and raise a multitude of questions. Many books and articles no doubt will be written to analyze these various issues in scholarly depth and detail, and certainly anything we might say today must be regarded as preliminary, at best. I focus here on a few aspects of the present episode that relate closely to my own research on the growth of government, a field of study to which I have returned again and again over the past thirty years.

I

The current recession has elicited many comparisons with earlier business downturns, especially with the Great Depression. Federal Reserve chairman Ben Bernanke is often described as an expert on the Great Depression who takes its lessons, as he understands them, deeply into account as he formulates and implements Fed policies. Likewise, many other economists have revisited the Great Depression recently in search of lessons applicable to current policy-making. In all of these reflections, the mainstream economics profession in general has distinguished itself by an astonishing superficiality of historical knowledge and lack of theoretical prowess.

The swiftness with which a great many mainstream economists have reverted to the simplistic “vulgar Keynesianism” that had its heyday from the late 1940s to the late 1960s has been nothing short of shocking, given that by the end of the 1970s such old-fashioned Keynesianism seemed to have been completely discredited and superseded in the leading echelons of the mainstream economics profession. Now it has come roaring back.

Of course, the general public, whose understanding of such matters is always primitive, and the politicians, who are always looking for plausible intellectual rationales to excuse their insatiable spending, borrowing, and power-grabbing, had never abandoned vulgar Keynesianism, so they were elated to find that the economic “experts” were again confirming their own self-interested inclinations.

From such vulgar Keynesian thinking flowed the succession of “stimulus” spending measures, beginning with the Bush administration’s, carried out in the spring of 2008. Other governments have gone down the same foolish path. Of course, as any competent economist could have testified even fifty years ago, such temporary government-spending surges give people money that, for the most part, they save or use to pay off debts, rather than spending it along the lines envisioned by Keynesian “multiplier” analysis to set in motion an upward spiral of income, expenditure, real output, and employment. Much of the so-called stimulus spending in the United States has served only to bulk up the pay and benefits of government employees (federal, state, and local), effectively transferring income from the private sector to the government sector, and to reward other groups, such as the United Auto Workers and low-income home buyers, for their support of the Obama administration—past, present, or future.

Bernanke and his colleagues in other central banks are taking credit for saving the financial system and even for saving the world from a repetition of the Great Depression—claims that must be treated with extreme skepticism. In any event, however, they have certainly created the potential for rapidly accelerating consumer-price inflation, should the banks become less apprehensive about their balance sheets and employ their vast excess-reserve balances to resume their lending and investing on a more normal basis.

Bernanke expresses confidence that he has the “tools” to rein in such potentially inflationary bank action, mainly by raising the interest rate the Fed pays banks on their deposits at the Fed, but one may well doubt whether he will be able to use those tools effectively. When interest rates begin to rise substantially, as they must sooner or later, great political pressure will be brought against tighter-money actions by the Fed and other central banks; the politicians will protest increases in interest rates at a time when unemployment remains at an elevated rate and other aspects of the recession linger, as well. So, even if Bernanke has the effective tools he claims to have, the question remains as to whether he will have the personal courage and the political support required to use those tools effectively.

II

One aspect of the current crisis that has come as anything but a surprise is that the politicians and their supporting coalition of crony capitalists and other backers have certainly not (in the immortal words of Barack Obama’s chief of staff Rahm Emanuel) allowed “a crisis to go to waste.” The past two years have witnessed one power-grab or institutional takeover after another, most notably of AIG, Fannie, Freddie, General Motors, and Chrysler. Under the TARP scheme, the Treasury has taken ownership positions in hundreds of large banks by acquiring preferred shares and warrants. Virtually all residential mortgage lending now ultimately springs from the secondary market and guarantees provided by Fannie, Freddie, Ginnie Mae, FHA, and VA. This aspect of the government’s power-grab has been especially important because by continuing to pump funds into dodgy mortgages, the government is preventing the necessary restructuring of the housing-construction industry and the mortgage-credit sector, propping up unqualified and underwater borrowers and ill-managed and even insolvent lenders, and thereby creating great potential for a second round of the housing/housing-finance bust in the near-term future.

As the huge recent expansion of the government’s size and scope has proceeded, the Treasury’s fiscal condition has deteriorated badly. The federal deficit jumped from an amount equal to about 3 percent of GDP in fiscal 2008 to an amount equal to about 10 percent of GDP in fiscal 2009, and even the government’s forecasts now project deficits in the neighborhood of $1 trillion per year for the next decade. Thus, the U.S. government’s debt has exploded, and will continue to rise relentlessly—or, it will do so as long as willing buyers can be found for bonds promising only modest nominal yields, a market that Uncle Sam can no longer assume will persist indefinitely. (The Chinese and other major buyers are already grousing and insisting that the U.S. Treasury act more prudently.)

While the government proper was expanding its size, scope, and power, the Fed was greatly expanding the magnitude and scope of its own balance sheet and, in effect, engaging in “industrial policy” by singling out particular firms and industries for assistance, while steering clear of others in equally dire condition. If the Fed is not “picking winners,” it is certainly deciding who will be spared a market-determined fate as a loser. Fed officials insist that they intend to withdraw from many of the new areas they have recently entered, once the crisis has passed, but it will be surprising if the recent “emergency” policies do not remain in the Fed’s arsenal, bulking up its power, and equally surprising if it sloughs off all of the unusual types of “securities” it has acquired in the past two years.

At the moment, the Fed is seeking—and it, the FDIC, or another government regulatory entity may well be given—wide-ranging statutory authority to reorganize preemptively any seemingly failing firm (not only banks) whose failure would pose, in the Fed’s estimation, a “systemic risk.” Such authority would greatly expand the Fed’s current power as a monetary central planner by adding a role as risk-management central planner. Regardless of whether the Fed, the FDIC, or another government regulatory entity ends up the winner of the current power scramble, the possible repercussions of this expanded power on the operation of the capital markets is frightful to contemplate.

III

As the current troubles have led many economists and others to revisit the government’s policies during the 1930s, some have concluded that even though the New Deal’s hodgepodge of policies never brought about full recovery, the action that most economists believe did effect a full recovery—in Paul Krugman’s words, “the large public works program, otherwise known as World War II, that ended the Great Depression”—suggests a remedy for today’s recession along similar lines. In retrospect, it is clear that this belief in the creation of “wartime prosperity” by massive government spending and deficit financing did more than anything else to bring about acceptance of the Keynesian paradigm in the 1940s and 1950s. Even today, not only the general public but most professional economists remain firmly convinced that, as the familiar saying maintains, “the war got the economy out of the Great Depression,” and hence a serious recession such as the present one naturally causes them to recall this supposed “lesson” of economic history. Among many lesser lights, Martin Feldstein, one of the country’s most eminent and influential economists, has recently proposed what amounts to an exercise in military Keynesianism as a stimulus measure.

The fly in this ointment, however, is that the lesson almost everyone has drawn from the events of the 1940s is false; the common belief is a myth. When we take apart the simplistic Keynesian analysis of the war’s effect on the economy and look carefully at what actually happened to the various components of the labor force, the capital stock, and the gross domestic product, we see that the economic events of the war years represent a classic case of a command economy’s sacrificing butter—not to mention life, liberty, and property—for the sake of producing and deploying more guns.

A single graph suffices to give us a more accurate portrayal of the economy’s performance in the 1930s and 1940s (for a complete analysis, see the first five chapters of my 2006 book Depression, War, and Cold War).

As the graph shows, real GDP dropped sharply in the early 1930s, then recovered rapidly after 1933, but it did not reach its high-employment growth trend until 1941, when the nature of the economy’s output (shifting rapidly into war production) was beginning to obscure the meaning of data that purport to measure “real output.” If we accept the standard data, a huge war boom appears to have occurred during the war years, followed by a sharp downturn, concentrated in 1946, after which the economy moved closely along its high-employment growth trend (shown in the figure by the straight line connecting the [logarithms of the] values for 1929 and 1948).

Looking at the private part of GDP—the part with a much clearer meaning, owing to its derivation from freely-made consumer and investor choices about the use of privately owned funds—we see a similar pattern during the 1930s, but a completely different pattern during the 1940s. After 1941, private output of both consumer and investor goods fell to much lower levels and remained submerged far below the high-employment growth trend throughout the war years. Private real output did not exceed its 1941 rate until 1946, when it shot up by about 30 percent in a single year. Afterward, the private economy moved closely along its high-employment growth trend. Real prosperity had been achieved at last, for the first time since 1929.

But wait, the critics protest: didn’t the war wipe out mass unemployment? Of course, it did. However, this elimination of mass unemployment had nothing to do with Keynesian fiscal policy (or, for that matter, with the concurrent, highly expansive monetary policy) and everything to do with the military draft, which pulled the equivalent of 22 percent of the prewar labor force into the armed forces. If the economy has 5–7 million persons unemployed, then drafting 10 million prime-age workers (and thereby inducing millions of others to enlist “voluntarily”) will “solve” the unemployment problem every time. To use the same policy today, the U.S. authorities need only to conscript about 30 million men—not, I daresay, a political idea whose time has come.

Indeed, the idea is preposterous, and so, more generally, is looking to the government’s alleged “large public works program, otherwise known as World War II” as a model of how to deal with today’s economic crisis. Rather than allow ourselves to be mesmerized by a statistically spurious bulge of real GDP during World War II, we are better advised to recall the wartime rationing of many ordinary consumer goods, the shortages or complete production closures of many consumer goods (e.g., automobiles, most consumer durables), the preemption of public transport by the military authorities, and the wage, price, and rent controls that caused, among many other undesirable consequences, drastic deterioration in the quality of many goods and services. Whatever else the war might have accomplished, it certainly did not produce conditions that we may properly describe as genuine prosperity.

IV

Even if policy makers decline to adopt World War II-type policies as remedies for the current recession, the immense magnitude of the present-day military-industrial complex certainly complicates all efforts to effect a recovery, by draining more than $1 trillion a year from the economy’s potential to produce private consumer and producer goods. The current long-running wars and military occupations in Afghanistan and Iraq, which will probably never end, although eventually they may be scaled back somewhat, only add to the economic drain on U.S. resources. So far, more than $1 trillion has been expended for these ill-fated adventures, and their total cost may eventually cumulate to several times this amount, not simply because they, like the U.S. military presence in Japan, Korea, and various European countries, will continue indefinitely, but also because of the need to care for a multitude of physically and psychologically disabled veterans over a span of several decades.

Even if the wars in the Middle East were concluded overnight, however, a huge distortion would continue to affect the U.S. economy, owing to the normal operation of the military-industrial complex and the maintenance of the current armed forces and their far-flung empire of more than 800 large overseas bases. This military hypertrophy reflects not an attempt to pump up the macroeconomy, as military Keynesians would have it, but rather the devotion of U.S. ruling elites to the maintenance of global military hegemony, ultimately capped by the attainment of “full-spectrum dominance”—“control of land, sea, air and space and all attendant resources” over the entire world.

Why do U.S. policy makers seek such god-like control of the planet? To the extent that the military leadership itself contributes to shaping national-security policies, this o’erleaping ambition merely expresses the latest phase of the military’s longstanding maniacal quest for total power—the undoubted ability to win any and all conceivable wars. Among the civilian leadership, the motives range more widely. An important impulse, though it is never mentioned frankly in polite company, is to maintain a foreign military presence configured so as to make the state of Israel as secure as possible. Another abiding interest is to control the worldwide distribution of petroleum, if necessary by bribing, intimidating, or taking military action against the governments of important oil-producing countries, especially in the Persian Gulf region.

Related to this wholly unnecessary quest to control the world’s oil-distribution channels—after all, it does not serve the interests of the oil producers to withhold their product from the world market—is the ambition to play the Great Game by throwing up barriers to the expanding influence of China and India and the residual potential of Russia in southwest Asia, especially in the Caspian Sea region, where vast stores of oil and gas remain to be tapped and brought to market. For more than half a century, U.S. leaders have been obsessed with projecting their country’s power into petro-military adventures of all sorts. However senseless this fixation might seem in a purely economic perspective, we can scarcely deny that the coziest crony capitalists in the oil and related industries have reaped a great deal of income along the way, and owing to their extraordinary political clout, they have every expectation of continuing to reap such income in the future, with the vital assistance of U.S. diplomats and armed forces to grease the skids.

Although the military-industrial-congressional complex is one of the most powerful interest groups in U.S. politics, and we may certainly expect it to struggle forcefully to retain or even to increase the flow of wealth placed at its disposal, the U.S. government’s increasingly precarious financial condition may compel even this powerful coalition to settle for a smaller space at the trough, especially if stagflation sets in as the U.S. economy’s normal condition during the next decade (as I suspect it will). If America’s economic future turns out to be even worse than I now foresee—for example, with rapid inflation, price and capital controls, and a flight from the dollar—then even greater retrenchment of the U.S. military presence abroad will be unavoidable. Such economic ruin would be a heavy price to pay for reining in America’s global hegemony, but, nevertheless, the military retrenchment itself would be a consequence that most of the world’s people would celebrate.

The United States’ economic troubles are mounting and already prodigious.  While it’s true that Obama inherited a mess – created by government – he has made our economic problems progressively (pun intended) worse.  Amidst that failure, however, Obama has accomplished something that is simply hard to believe.

Before I get to that stunning achievement, it worthy to consider just how bad the employment picture really is.  Since the Great Depression, unemployment has reached this neighborhood of 10%, i.e. nearly double the historic average, only one other time.  That was during the early 1980’s.  That unemployment was brought on by the combined bad economic (read: “political”) decisions of Presidents Johnson, Nixon, Ford and Carter.  All combined, they produced high unemployment and high inflation in addition to new terminology – stagflation.  In order to wring inflation out of the system, President Reagan’s economic remedy eventually produced a record 92 months of growth but started with unemployment above 10%.  In fact, unemployment was above 9% for 18 months before steadily dropping to 5.3% at the end of Reagan’s two terms.

When Obama got his so-called stimulus package (read: record pork-barrel bill) passed, he promised that unemployment would not rise above 8%.  It has now been above 8% for 15 months – it has been above 9% for 12 months.  Obama openly admits that unemployment will be a problem for a long time to come.  He could not be more right considering that he is proposing a series of huge tax hikes, i.e. the expiration of the Bush tax cuts along with his cap and trade energy plan which is more rightly named “cap and tax.” Beyond that, Obama’s health care legislation has imposed huge regulatory costs on American business – costs which come at the expense of American jobs.  Those are some of the reasons there is so much talk of the possibility of a double-dip recession. Quite frankly, an unemployment rate above 8%, if not 9%, for another 24 months is a real possibility.

Unemployment that is nearly double the national average, and at a 30 year high with no end in sight, is incredibly bad and of deep concern to many Americans.

As bad as that is, however, Obama has accomplished something literally stunning.

According to Gallup polling released the first week of June – unemployment ranks only 4^th among Americans biggest concerns.  Indeed, Americans top 4 concerns are:

4) Unemployment

3) Healthcare costs (according to Rasmussen 60% want the healthcare bill repealed).

And a tie at the top between:

1) Federal Debt (Obama has added $6.5 trillion beyond what he can possibly claim her inherited – that’s $163,000 for every taxpaying family), and

1) Terrorism (attacks on American soil are way up courtesy of his weak foreign policy).

It is simply unbelievable that Obama has made Americans so worried about healthcare, terrorism and the federal debt that they would rank historically high unemployment 4^th.    That tells a very sorry tale about the State of the Union, and just think, only 2 ½ years left for him to “achieve” even more.

Like a junkie that keeps increasing his fix to get the same high, the U.S. Government deficit spending addiction has expanded by an all-time record 9.66% compound annual rate of the growth over the last thirty years.  Even during the tumultuous three decades that included the Great Depression, World War II and the Cold War, the U.S. deficit only expanded at an 8.51% compounded growth rate.  Fortunately, the American people are increasingly convinced that feeding this addiction not only does not work; it might be dangerous.

U.S. Federal Reserve Chairman, Ben Bernanke, earned the title “Helicopter Ben” from critics who latched onto his quote; “The U.S. government has a technology, called a printing press that allows it to produce as many U.S. dollars as it wishes at no cost.”  Mr. Bernanke went on to state that the Federal Government could always rent helicopters and fly over cities dumping out cash to get the economy moving.  This is the equivalent of the “pusher man” who gives out free samples of narcotics expecting that the users get hooked.

From the outset of the financial crisis, the U.S. Federal Government has been flying its helicopters over America and sprinkling huge amounts of money on programs such as, “Making Homes Affordable”, “Cash for Clunkers”, unemployment benefit extensions, infrastructure boondoggles and various Wall Street crony bailouts.  This spending and guarantee orgy during 2009 resulted in a U.S. budget deficit of $2.5 trillion and only generated an incremental increase in GDP of $200 million.  Only government can avoid going to prison for involuntarily taking a dollar from a person, squandering 92 cents and giving a nickel and three pennies back.

Passage of the $787 billion American Recovery and Reinvestment Act (ARRA) was trumpeted as the silver bullet to save the economy and create 3.5 million jobs.  The Administration estimated that although each job would cost taxpayers $92,136, the resulting increase in gross domestic product of $105,000 would more than pay for the cost.  But a referral to “Recovery.Com”, the official U.S. government web site regarding ARRA “funded jobs”, states that only 681,825 jobs have been funded so far and at a cost of $117,933 each.  Consequently the US Government actually spent $25,797 in overhead cost for a make work job.  Further more, given that the average American working in the private sector makes only $36,400 per year, it would take the equivalent of 3.24 full-time workers taxed at 100% of their annual income to pay for one make work job.

The U.S. Federal Reserve in their April meeting continued to predict that unemployment will fall to 9.3% this year and 8.2% in 2011.  In order to achieve this reduction, the U.S. economy would need to add 385,000 jobs each month through December of this year and 323,000 each month next year.  With the trend of initial jobless claims running above the 400,000 level where the economy starts to add net jobs, these numbers seem psychotic.

The “generosity” of the U.S. Government with Americans’ money is not only restricted to our domestic concerns.  In a show of support for the European $1 trillion bailout of Greece, the U.S. Federal Reserve opened up U.S. dollar swap agreements with the European Union, England, Switzerland and Canada.  Since the Federal Reserve is not required to be publicly audited, we will never know how big of a commitment the taxpayers will be responsible to pay.

The only possible alibi the U.S. Government can provide to support their deficit spending is that it encouraged a massive increase in discretionary personal consumption.  Unfortunately, this focus on conspicuous consumption versus productive investment is why U.S. industrial production as a percentage of GDP has been cut in half over the last 30 years.  Today, the GDP of the U.S. is only 22% industry and 77% services versus the GDP of China of 49% industry and only 40% services.  With the average age of Americans increasing and their savings rate for retirement having expanded by 4% since the beginning of the financial crisis, we may have reached the tipping point that explains why consumption targeted government stimulus is a failure.

It is clear that deficit spending has not only been ineffective, but has dangerously skewed the American economy to focus on consumption versus production.  If the definition of insanity is doing the same thing over and over and expecting different results, then it is time for Americans to force their government to go “cold turkey” and break the long term addiction to deficit spending.

Teachers unions, the Obama administration, and most Democrats in Congress want to spend another $23 billion that we don’t have to shore up public school employment. If we don’t go along, they tell us, it’ll be a “catastrophe” for American education. With fewer teachers our kids will supposedly learn less, further crippling our already wounded economy.

They couldn’t be more wrong.

Over the past forty years, public school employment has risen 10 times faster than enrollment (see chart). There are only 9 percent more students today, but nearly twice as many public school employees. To prove that rolling back this relentless hiring spree by a few years would hurt student achievement, you’d have to show that all those new employees raised achievement in the first place. That would be hard to do… because it never happened.

Student achievement at the end of high school has been flat for as long as we’ve been keeping track—all the way back to 1970. But we did get something in return for all that hiring: a great, big, fat, BILL.

If you graduated from high school in 1980, your entire k-12 education cost your fellow taxpayers about $75,000, in 2009 dollars. But the graduating class of 2009 had roughly twice that amount lavished on their public school careers. The extra $75,000 we’re now spending has done wonders for public school employee union membership, dues revenue, and political clout. It’s done a whole lotta nothin’ for student learning (see chart).

But, some readers may ask: were all those new employees teachers? About two thirds of public school employment growth has been teachers (41 percent) or teachers’ aides (23 percent). The remaining third was comprised almost entirely of support staff in schools and district offices.

So, yes, a bit of public schooling’s employment bloat can be put down to a swelling bureaucracy. But given that adding a couple of million new instructional jobs did nothing to improve achievement at the end of high school, there’s no reason to expect that shedding a few hundred thousand of them would hurt it.

Ed. sec. Arne Duncan and friends are thus mistaken if they really expect a negative academic or economic impact from reversing some of our costly and ineffectual public school employment growth. In fact, they actually have it backwards.

In the private sector, jobs are created and retained only if they are believed to add value to the enterprise—if their salary and benefit costs are outweighed by the revenue they generate. By contrast, we know that the millions of new government school positions added over the past four decades have not added measurably to student knowledge or skills at the end of high school. So instead of boosting the U.S. economy, these jobs have actually been a drain on it. Returning to the staff-to-student ratio we had in 1980 would save taxpayers about $142 billion every year.

Losing a job is a terrible experience, but the school hiring binge of the past four decades has been entirely disconnected from enrollment levels and unaccompanied by educational improvement. Foolish public officials and self-serving, empire building teachers’ unions have created millions of unproductive jobs that were never justified in the first place and that have been a terrible drain on the U.S. economy.  With the nation $13 trillion in debt and many state governments looking at red ink for years to come, we just can’t afford to perpetuate their mistake any longer.

Throwing billions more at the system would only worsen the problem and delay the solution, which is to help ease the transition of these workers from their current unproductive employment back into the productive sector of the economy.

Friday’s May jobs figure is vastly skewed because of the hundreds of thousands of temporary census employees—approximately 411,000—hired to perform the decennial enumeration of the U.S. population and gather concomitant vital information. In the coming days, economists will be assessing the distorting effect the addition of these temporary public sector workers has on the restoration or creation of employment and the overall strength or weakness of the economic recovery.

A few non-economists like myself, however, will be asking a very different question.

Namely—what can the history of the cost of performing the once-a-decade head count reveal about how government-run health care costs will behave? Will Obamacare be the exception to the runaway cost rule? Let’s use the census as a yardstick.

To keep this analysis at its most simple, let us compare the rate at which the population increased with the rate at which the cost of counting it (the decennial census) increased. That sounds sensical enough.

According to Appendix A-1 of Jason Gauthier’s 2002 study entitled Measuring America: The Decennial Censuses from 1790 to 2000, the cost to perform the census has risen over the decades at a rate staggeringly higher than the rate of the growth of the population itself. What does this mean? Simply put, that bureaucracy is obese. Morbidly obese.

Whatever the opposite of efficiency is, the cost of taking the census epitomizes it.

Consider this chart from Gauthier’s study:

*2010 estimates are the GAO’s own best guesses. For more information, visit its site here.

Now let’s add three more columns, (1) the average cost per person counted along with (2) the year-on-year rate of growth of the population and (3) the year-on-year rate of increases in the census costs. That chart looks like this:

*2010 estimates from GAO (see above).

You don’t need to hold an MBA from the Harvard Business School to recognize fiscal management run amok. Not only is no one minding the store—they’re giving it away.

Look at one short example from the above table: taking the census cost a little more than 60 cents per person in 1950 ($91.4 million). It is projected to cost nearly $47 per person in 2010 ($14.5 billion). That’s a whopping 7822% increase in cost per person. During the same time, the population rose by 100% (i.e., doubled) from 150 million to over 300 million. But the overall cost of counting it (the census) rose by 15,800%. This is fiscal discipline only Greece could be proud of.

Counting heads is a relatively simple procedure. Especially when compared to much more complex endeavors such as curing cancers, treating pain, setting fractured bones, diagnosing illnesses, providing emergency treatment and the like.

If the costs of a relatively simple administrative procedure like taking the decennial census have a history of spiraling wildly out of control, what is the graph of runaway Obamacare costs going to look like? Imagine the price tag of having the government in charge of keeping Americans healthy—compared to just counting their noses.

The CBO was merely a pawn used by the Obama administration to lend a much-needed imprimatur to its incredible claims of lowered health care costs in order to hoodwink legislators into passing and the public into accepting this massive entitlement. But as one economic wag described the validity of the CBO’s projections a month or so ago on Kudlow and Company: “Fantasy in, fantasy out.” FIFO. The public has shown itself less gullible than the lawmakers—it still widely supports repeal by a 63% majority according to a recent Rasmussen poll of 1000 likely voters.

If you think Obamacare looks expensive now, just massage the CBO’s risibly unrealistic projections with a little reality from the census’s actual costs over the decades. The census cost spiral demonstrates that in no time at all Obamacare will grow so obese it’ll have to be pushed around in a wheelchair.

That is, unless enough educated dissenters vote this wrong-headed law’s supporters out of office in November and begin the long hard uphill push to repeal. Then and only then will Obamacare have a chance of winding up where it really belongs–not in a wheelchair, but on a gurney.

Friday’s May jobs figure is vastly skewed because of the hundreds of thousands of temporary census employees—approximately 411,000—hired to perform the decennial enumeration of the U.S. population and gather concomitant vital information. In the coming days, economists will be assessing the distorting effect the addition of these temporary public sector workers has on the restoration or creation of employment and the overall strength or weakness of the economic recovery.

A few non-economists like myself, however, will be asking a very different question.

Namely—what can the history of the cost of performing the once-a-decade head count reveal about how government-run health care costs will behave? Will Obamacare be the exception to the runaway cost rule? Let’s use the census as a yardstick.

To keep this analysis at its most simple, let us compare the rate at which the population increased with the rate at which the cost of counting it (the decennial census) increased. That sounds sensical enough.

According to Appendix A-1 of Jason Gauthier’s 2002 study entitled Measuring America: The Decennial Censuses from 1790 to 2000, the cost to perform the census has risen over the decades at a rate staggeringly higher than the rate of the growth of the population itself. What does this mean? Simply put, that bureaucracy is obese. Morbidly obese.

Whatever the opposite of efficiency is, the cost of taking the census epitomizes it.

Consider this chart from Gauthier’s study:

*2010 estimates are the GAO’s own best guesses. For more information, visit its site here.

Now let’s add three more columns, (1) the average cost per person counted along with (2) the year-on-year rate of growth of the population and (3) the year-on-year rate of increases in the census costs. That chart looks like this:

*2010 estimates from GAO (see above).

You don’t need to hold an MBA from the Harvard Business School to recognize fiscal management run amok. Not only is no one minding the store—they’re giving it away.

Look at one short example from the above table: taking the census cost a little more than 60 cents per person in 1950 ($91.4 million). It is projected to cost nearly $47 per person in 2010 ($14.5 billion). That’s a whopping 7822% increase in cost per person. During the same time, the population rose by 100% (i.e., doubled) from 150 million to over 300 million. But the overall cost of counting it (the census) rose by 15,800%. This is fiscal discipline only Greece could be proud of.

Counting heads is a relatively simple procedure. Especially when compared to much more complex endeavors such as curing cancers, treating pain, setting fractured bones, diagnosing illnesses, providing emergency treatment and the like.

If the costs of a relatively simple administrative procedure like taking the decennial census have a history of spiraling wildly out of control, what is the graph of runaway Obamacare costs going to look like? Imagine the price tag of having the government in charge of keeping Americans healthy—compared to just counting their noses.

The CBO was merely a pawn used by the Obama administration to lend a much-needed imprimatur to its incredible claims of lowered health care costs in order to hoodwink legislators into passing and the public into accepting this massive entitlement. But as one economic wag described the validity of the CBO’s projections a month or so ago on Kudlow and Company: “Fantasy in, fantasy out.” FIFO. The public has shown itself less gullible than the lawmakers—it still widely supports repeal by a 63% majority according to a recent Rasmussen poll of 1000 likely voters.

If you think Obamacare looks expensive now, just massage the CBO’s risibly unrealistic projections with a little reality from the census’s actual costs over the decades. The census cost spiral demonstrates that in no time at all Obamacare will grow so obese it’ll have to be pushed around in a wheelchair.

That is, unless enough educated dissenters vote this wrong-headed law’s supporters out of office in November and begin the long hard uphill push to repeal. Then and only then will Obamacare have a chance of winding up where it really belongs–not in a wheelchair, but on a gurney.

From the Associated Press:

A wave of census hiring lifted payrolls by 431,000 in May, but job creation by private companies grew at the slowest pace since the start of the year. The unemployment rate dipped to 9.7 percent as people gave up searching for work.

The Labor Department’s new employment snapshot released Friday suggested that outside of the burst of hiring of temporary census workers by the federal government many private employers are wary of bulking up their work forces.

That indicates the economic recovery may not bring relief fast enough for millions of Americans who are unemployed.

Virtually all the job creation in May came from the hiring of 411,000 census workers. Such hiring peaked in May and will begin tailing off in June.

By contrast, hiring by private employers, the backbone of the economy, slowed sharply. They added just 41,000 jobs, down from 218,000 in April and the fewest since January.

The unemployment rate, which is derived from a separate survey than the payroll figures, fell to 9.7 percent from 9.9 percent. The dip partly reflected 322,000 people leaving the labor force for a variety of reasons.

All told, 15 million people were unemployed in May.

Counting people who have given up looking for work and part-timers who would rather be working full time, the “underemployment” rate fell to 16.6 percent in May from 17.1 percent in April. Even with the drop, the high underemployment figure shows how difficult it is for jobseekers to find work.

Employers across a range of industries last month added jobs at a slower pace—or cut them. Factories, professional and business services, leisure and hospitality companies, and education and health care firms all slowed hiring. Financial services, construction companies and retailers all pared jobs. Government, however, led the way in hiring, adding a whopping 390,000 positions last month.

Continue reading here. Keep in mind that the overwhelming majority of those government jobs are temporary.

For nearly a year, MyTwoCensus.com was the only media outlet reporting about the problems that the Census Bureau faced in terms of fingerprinting the 1.4 million people who were set to work for the 2010 Census. And we continue that fight today.

In December 2009, I reported that a convicted felon in Alaska was working in a supervisory position for the Census Bureau. This was discovered only after the man killed his mother and then himself. Clearly, this incident should have made calls for improved fingerprinting procedures at the Census Bureau obvious. However, the Census Bureau maintained the status quo and did nothing — fending off my questions and ignoring my concerns.

This incident occurred two months AFTER I originally posted the flaws of the 2010 Census fingerprinting process that were written by child advocate and fingerprinting expert David Allburn, who offered solutions to the Census Bureau that were ultimately refused. Allburn wrote:

(1) The Bureau should announce that trainees are responsible for the “readability” of their own fingerprints, and that fingerprint “failure” due to un-readability (or to discovery of disqualifying criminal history), terminates the canvasser’s employment. This stops attracting ex-felons who would intentionally blur their prints, but it is manifestly unfair to honest workers whose fingerprints are blurred by the inexperienced print-takers. This is fixed by step two.

(2) The Bureau should augment its fingerprint capture by adopting part of our patented “self-capture” technique. Invented by a war veteran, the method has applicants use an extra minute or two to make their own set of “backup prints”, observed and authenticated by the print-taker. Barcoded and enclosed with the cards forwarded to the scanning center, those self-captured prints are readily available for fixing any individual print impressions found “bad.” Well tested, this gets the cards through the FBI with the same dependability as live-scanning offers, typically twenty times better than the old rubber-stamp method now in use.

Only after a handicapped woman was raped by a 2010 Census employee and a sex offender was caught going door-to-door did the Census Bureau decide to change their policies. Is that what it takes to create “change” in America?

The infamous Tammany Hall boss George Washington Plunkitt distinguished between “honest graft” and “dishonest graft.” Dishonest graft, he said, meant actual theft from the treasury, or shaking down criminals for bribes. Honest graft, on the other hand, simply meant taking advantage of private deals that arose in the course of public office. “I might sum up the whole thing by sayin’: I seen my opportunities and I took ‘em,” he said.

Former Illinois governor Rod Blagojevich starts his federal trial today. And the Illinois Democrats who clung to his coattails for years are desperate to pretend they don’t know him. Back in 2003, Rep. Jan Schakowsky proclaimed of Blago: “He really is very smart. I don’t laugh at the idea [of his running for President] at all.” She added that when he walked into a room, “there was this crackle of electricity. Everyone wanted to touch him.”

That electricity prompted Rep. Schakowsky to donate $28,000 to Blago’s campaigns for governor. Her husband, convicted felon and political strategist Robert Creamer, made $541,000 helping Blago get elected in 2002. She lobbied him heavily in November 2008 in the hope that he would appoint her to fill the Senate seat being vacated by Barack Obama, and is thought to be “Senate Candidate 3” in the original criminal complaint.

Now she is trying to laugh it off, nervously telling the Politico that the trial will be a “soap opera.”  She and other Illinois Democrats are trying to pretend that even though Blago’s alleged crimes involved prominent figures in federal, state, and local government, he was a lone wolf. But they are nervous, because the connections are there. (Is it just a coincidence that President Obama chose last weekend, of all others, to visit Chicago?)

The story they are all sticking to is that Blago is a special case–and he has done his best to prove them right. Rather than laying low, he has used every camera and open mic to denounce the federal prosecutor and the allies who abandoned him. Yet selling the Senate seat–the “f***ing valuable thing,” to quote Blago–was what Plunkitt would have recognized as “honest graft.” It is the rule in Chicago, not the exception.

David Axelrod said it himself in an article he penned for the Chicago Tribune in August 2005. Back then, he was advising both Obama and Mayor Richard Daley, and defended Daley against allegations of corruption. Trading favors for votes, Axelrod said, was not a  scourge, but a better way of doing business. Political grease made government “a well-oiled machine,” he wrote, elevating corruption from a problem to a philosophy.

Blago has claimed, repeatedly, that he will be vindicated. He may be right, in one sense: he will be brought down for “honest graft,” not the “dishonest” kind. Along the way, the public will get a close-up view of how Axelrod’s “well-oiled machine”–now exported to Washington, DC–really works. And people are more curious now than ever, because in the midst of a budget crisis at every level, we are aware of the true costs of corruption.

Tammany Hall fell when it could no longer pay the mortgage on its lavish headquarters. In the same way, today’s political bosses are up against the financial reality of massive public debt and underfunded pensions. They know the federal spending can only last so long; they’re just taking their opportunities, like Blago and Plunkett did–and like the White House hoped Joe Sestak and Andrew Romanoff would. November brings a different kind of opportunity–an opportunity for voters to bring about real reform. It is a chance that may not come again.

Earlier today, Andrew Breitbart, James O’Keefe and Shaughn Adeleye were guests on the Glenn Beck Radio Program.

In the first segment, Breitbart discuss various stories from Big Government and Big Journalism including the SEIU protests at the home of B of A executive Gregory Baer and Huffington Post & Media Matters unusual involvement in the coverage of that story.

In the second segment, James O’Keefe and Shaughn Adeleye join Beck for a discussion of the latest video investigation surrounding the Census Bureau.

$15 billion. That’s the budget of the 2010 US Census. Where to begin with how it has been misspent? When we look back at the past ten years, we can see how the Census Bureau is an institution in need of major reforms because poor work has been rewarded and PR spinsters have been left running the show to make it seem like everything is hunky-dory.

The 2010 Census is currently in the non-response follow-up (NRFU) stage of operations (to track down individuals who did not mail back their 2010 Census forms on time), which is the largest and most expensive stage of the 2010 Census. 635,000 workers are involved in this operation, and it is the largest peacetime civilian hiring effort in the history of the United States. Yet this operation has been plagued by failure from the get-go. Let’s first take a look at the now infamous handheld computer debacle:

In 2006 the Census Bureau signed a contract with the Florida-based Harris Corporation to design handheld computers (HHCs) that would be used for the 2010 Census. This contract was initially worth $600 million. Yet because of poor directions and incompetence from Census Bureau officials about what they desired and a the failure on on the part of Harris Corp. to determine what specifications the government needed, the designs that were used for this project were flawed from the get-go.

Rather than creating a “fixed price contract,” the government created a “cost-plus contract” that essentially gave the Harris Corp. a blank check to fiddle around as they wished to the tune of $600 million. And, they fiddled and fiddled and fiddled and failed.

So what did the Census Bureau do to correct this problem? They gave the same company an extra $200 million in 2008 and told them to try it again. Ultimately, Harris delivered some handheld computers that were able to be used during the Address Canvassing phase of 2010 Census operations, but employees have repeatedly claimed that these devices were extremely faulty, slow, and at times completely non-functional. (Had the Census Bureau decided to equip its employees with special versions of the Blackberry or I-Phone, such a debacle would have been avoided.)

In April 2009, Vivek Kundra, Obama Administration’s chief information officer, told Congress, “The federal government doesn’t do a good job of defining what the requirements are.” He continued, “By the time you find out the requirements have increased or the budget is out of control, it’s too late to make an adjustment.”

The only positive force that has come out of this failure by Harris Corporation and the Census Bureau is that it has become clear just how lax the rules are for corporations trying to obtain government contracts and how far behind the government is in terms of IT matters, even when the Obama Administration prides itself on its supremacy of technological know-how.

Ultimately, at the eleventh hour, the government chose not to use these shoddy handheld computers for the current non-response follow-up operations, so enumeration is now being done by hand to the cost of $3 billion additional dollars, a figure that Census Bureau Director Robert M. Groves acknowledged at his most recent press conference.

*Note that Australia and even BRAZIL, yes, that large developing nation in South America, are now successfully using the Internet and handheld computers to conduct census operations.

So now the Census Bureau is in the midst of its non-response follow-up operations, it must rely on a “paper-based operations control system” –better known as ancient technology– to enumerate nearly 100 million people. (And guess who is responsible for implementing and maintaining this paper-based operations control system? None other than the Harris Corporation!)

The software that local census offices use to obtain the address lists of individuals who have not mailed back their forms have experienced consistent failures and outages since this stage of operations began. Reports and complaints regularly come in to MyTwoCensus.com from workers who are paid to sit around all day with books and games, as they simply can do no work until the software allows print-outs to be made.

Unfortunately, even Census Bureau Director Robert M. Groves is complicit in creating elaborate cover-ups that have plagued 2010 Census operations. On May 11, he told NextGov that all of the PBOCS problems were fixed, when this wasn’t the case at all, as is evidenced by an e-mail distributed from one of his deputies two days later.

At this stage, the accuracy of the 2010 Census is in major jeopardy, and in the coming days and weeks, I will further elaborate on the (literally) hundreds of different problems that plague the Census Bureau.

Speaking to CNBC in Las Vegas recently, Steve Wynn, the billionaire developer and operator of entertainment properties, said: “Washington is unpredictable these days. No one has any idea what’s next . . . the uncertainty of the business climate in America is frightening, frightening to everybody, and it’s delaying recovery.” Wynn complains of “wild, uncontrolled spending” and “unbelievable, unsustainable debt.”

Wynn also has operations in China, and he remarks that he “has no qualms about dealing with the Chinese government. Macau has been steady. The shocking, unexpected government is the one in Washington.” Not very long ago, such a statement would itself have been shocking.

The gambling and real estate magnate expresses concerns about inflation, Federal Housing Administration’s making the same mistakes Fannie and Freddie have made, and the business costs arising from the new health-care law. “We’re on our way to Greece,” he declares, “in the hands of a confused, foolish government.” Exasperated, he mutters, “It’s got to stop. It’s got to stop.”

These observations remind me of similar statements made by investor Lammot du Pont in 1937: “Uncertainty rules the tax situation, the labor situation, the monetary situation, and practically every legal condition under which industry must operate.” Even members of Franklin D. Roosevelt’s cabinet eventually appealed to him to clear the air in which private investors were finding it difficult to breathe, but he refused to do so, preferring to plunge ahead with the New Deal and to publicly blame “economic royalists” for his policies’ failures.

Du Pont was hardly the only one making such observations in 1937 about regime uncertainty’s negative effect on recovery, and Wynn is hardly the only one now making such observations.

From ABC News:

The conservative filmmaker arrested this year for an undercover attempt to tape staffers at a U.S. senator’s office said his next target — the Census Bureau — is another example of government waste.

James O’Keefe, fresh off sentencing for his role in the attempted sting on Sen. Mary Landrieu’s Louisiana office in January, signed up to work for the Census in hopes of exposing what he alleges is the bureau’s waste of taxpayer money.

O’Keefe said in an exclusive interview today with “Good Morning America” that he has no plans to stop his undercover operations.

“You’re on notice…if you are doing things behind closed doors, we will find you and we will film you,” O’Keefe said.

O’Keefe and friend Shaugn Adeleye signed up in May to work for the Census Bureau in New Jersey and Louisiana, respectively.

They each attended paid training courses: O’Keefe earned $18.25 an hour and Adeleye made $13.25 an hour.

The two quit after a few days and, O’Keefe said, his time with the Census Bureau proved his theory that the government entity was wasting money.

“Over the course of two days I was paid for as many of 3 ½ to 4 hours of work I didn’t do,” O’Keefe said.

“This is just the tip of the iceberg,” he said.

When O’Keefe confronted his supervisor about getting paid for hours he didn’t work, she told him not to worry about it.

“We all left early,” O’Keefe could be heard telling his supervisor on the tape.

“You got paid for two hours more then,” his supervisor replied.

“Yeah, so that’s all I’m concerned about,” O’Keefe told her.

“I would say don’t be concerned…you did your best to, you know, to bring it to our attention. I don’t, I don’t think anyone’s going to be questioning it, except for you,” she told O’Keefe. “So I would just let it go.” When O’Keefe’s colleague, Adeleye, approached his supervisor in Louisiana showing that he was paid for hours he did not work, his supervisor said “I’d throw it away. But I mean, you want to keep it for your records, fine.”

Continue reading here.

From the New York Post:

You know the old saying: “Everyone loves a charade.” Well, it seems that the Census Bureau may be playing games.

Last week, one of the millions of workers hired by Census 2010 to parade around the country counting Americans blew the whistle on some statistical tricks.

The worker, Naomi Cohn, told The Post that she was hired and fired a number of times by Census. Each time she was hired back, it seems, Census was able to report the creation of a new job to the Labor Department.

Below, I have a couple more readers who worked for Census 2010 and have tales to tell.

But first, this much we know.

Each month Census gives Labor a figure on the number of workers it has hired. That figure goes into the closely followed monthly employment report Labor provides. For the past two months the hiring by Census has made up a good portion of the new jobs.

Labor doesn’t check the Census hiring figure or whether the jobs are actually new or recycled. It considers a new job to have been created if someone is hired to work at least one hour a month.

One hour! A month! So, if a worker is terminated after only one hour and another is hired in her place, then a second new job can apparently be reported to Labor . (I’ve been unable to get Census to explain this to me.)

Here’s a note from a Census worker — this one from Manhattan:

“John: I am on my fourth rehire with the 2010 Census.

“I have been hired, trained for a week, given a few hours of work, then laid off. So my unemployed self now counts for four new jobs.

“I have been paid more to train all four times than I have been paid to actually produce results. These are my tax dollars and your tax dollars at work.

“A few months ago I was trained for three days and offered five hours of work counting the homeless. Now, I am knocking (on) doors trying to find the people that have not returned their Census forms. I worked the 2000 Census. It was a far more organized venture.

“Have to run and meet my crew leader, even though with this rain I did not work today. So I can put in a pay sheet for the hour or hour and a half this meeting will take. Sincerely, C.M.”

Continue reading here.

The political process often resembles an unseemly racket as politicians take money from people who earn it and give it to another group in exchange for campaign cash and political support. The modern bureaucracy is a good example. Government workers have now become a cosseted elite, with generous pay, extravagent benefits, lavish pensions, and ironclad job security. In exchange for this privileged status, they reward the politicians with millions of dollars of support and a host of in-kind contributions.  I have documented many of these outrages in my “Taxpayers vs. Bureaucrats” series at the International Liberty blog. Well, now we have a video detailing how the government workforce has morphed into a fiscal nightmare for taxpayers.

There are three things in the video that deserve special emphasis. First, bureaucrats are vastly overpaid. The government data cited in the video show that total compensation for the federal civil service is twice as high, on average, as it is for workers in the productive sector of the economy. There are some bureaucrats who deserve above-average pay, such as scientists dealing with nuclear weapons, but it is outrageous that the average drone in the federal bureaucracy is getting twice as much compensation as the taxpayers (serfs) who pay their salaries.

Second, this mini-documentary debunks the silly argument (put forth by government employee unions, of course) that bureaucrats are underpaid compared to the private sector. The Department of Labor has data looking at voluntary departure rates by profession. If government workers were being underpaid, you would expect them to be more likely to leave their jobs in order to take new positions in the (supposedly higher paid) private sector. Instead, the video reveals that people in the private sector are six times more likely to switch jobs than federal bureaucrats.

Third, the video concludes with the essential point that most federal bureaucrats should be paid nothing because they work for departments and agencies that should not exist.

Hillary Clinton touched off an age old discussion this week about whether the rich are paying their “fair share.”  It is, of course, one the Left’s most used demagogic cries and one of its biggest proponents is former Labor Secretary now University Professor Robert Reich.  He was on Larry Kudlow’s show recently demonstrating, in glaring fashion, the Left’s the case for big government and higher tax rates.  It was a case study on why the American economy is slumping today.

What is Fair?

Hillary, Nancy, Harry, Obama and many others on the Left use the fair share argument, which is nothing more than a class-warfare tactic, as a prelude to raising tax rates to pay for social welfare programs. Stephen Moore, who was also the show and has been fighting this fight for years, and ably so, pointed out that the top 2 ½% of income tax payers pay the same amount in income taxes as the bottom 97 ½%.  It is also fact that the bottom 50% of income earners pay almost no income tax at all. If that is unfair in the minds of the Left, then clearly they want a chosen few to pay for everything and believe FDR when he said: “increasing the tax paid by individuals in the higher brackets . . . was the American thing to do and increasing still further the taxes paid by individuals in the highest brackets was even more the American thing to do.”

Of course, the problem with such policies is that wealth moves in the form of businesses and their owners moving away, along with sensible people realizing that it is not worth their time to risk everything only to have the state confiscate their rewards, and for still others to simply engage in tax evasion such as under reporting income and bartering.

Wherever and whenever in history the tax rates have become too confiscatory they have destroyed the economic vitality of the city or state that pushed them in the name of fairness.  The result has been lower income, less jobs, poorer people and , oh yes, less tax revenue.  That is why Keynes said that the high tax rates defeat their own purpose.

Capitalism Requires Capital.

For Robert Reich, who has had government job after government job, the notion that capitalism needs capital appears to be downright Greek to him.  While advocating for higher tax rates, he stated that there were higher tax rates in the 50’s and 60’s and there was more economic growth than today.  Such rhetoric is fraud by omission.  While it is true that the top marginal rate was 94% under Truman, 91% under Eisenhower, and 70% under Johnson, Kudlow and Moore well pointed out what Professor Reich conveniently forgets or never knew: there are multitude of other taxes now on the books, or that are much higher than ever before, that have produced an overall tax burden much higher than in those years.

Beyond that, the regulatory burden businesses faced in the 50’s and 60’s is dwarfed by the burden they face today.  Finally, the only sustainable growth economic periods, over the last 40 years, were all touched off by the cut in the marginal tax rates in 1965 from 91% to 70% by Johnson, from 70% to 28% by Reagan, and George Bush 2003 tax cuts.  By contrast, the 50’s had no less than 3 recessions because the high marginal tax rates choked off capital formation and the government spending of the day couldn’t sustain the US economy.  Sound familiar?

In the face of such facts, Reich offered the theory of the social-welfare Left for economic growth: “investing” in “people” through education and social welfare programs leads to job and economic growth.   As Reich listed the many such programs for which he wants the rich to pay their fair share, which he surmises will lead to jobs, Stephen Moore attempted to interject multiple times:  “What about businesses?”  You know, the outfits that actually hire people?

Reich wouldn’t bite – he just doesn’t accept that if you raise the costs on businesses and their owners, you deprive them of the very capital they need to survive, grow and add employees – let alone pay income tax.  And that, in a nutshell, is why the welfare state of the Left which they have long sought is choking off American prosperity today.

Fortunately, recent Rasmussen polling today indicates that 2/3rds of Americans believe like Kudlow and Moore that tax cuts are the key to economic revival not tax and spend policies.  As the 2010 midterm elections approach, the Congressional Republicans need to join that choir in earnest and start winning back the hearts and minds of Americans on the issue of economic prosperity.

Secretary of State Hillary Clinton recently said that “the rich are not paying their fair share” of taxes in the United States and other developed countries.

Is she right? It depends on what you consider fair. Using 2006 data, The New York Times found that the richest 20 percent of households were paying 26 percent of their income to the federal government in the form of income, payroll, corporate, and excise taxes. The average for all familes? 21 percent.

And there’s this: “In 2006, the top quintile of households earned 55.7 percent of pretax income and paid 69.3 percent of federal taxes, while the top 1 percent of households earned 18.8 percent of income and paid 28.3 percent of taxes.”

Paying in a lot more than you get out? That doesn’t seem fair.

The rich are different than you and me; they’ve got more money. And they pay more federal taxes, both in absolute and percentage terms.

Politicians are different too. they rarely say what they really mean. Perhaps what Secretary Clinton means is that the rich can always pay more than they’re already paying.

That would explain why she and the president are lobbying to let the Bush tax cuts expire at the end of the year, a policy that would raise all sorts of taxes on all sorts of people.

Which doesn’t sound all that fair either.

Produced by Meredith Bragg and Nick Gillespie.

Go here for documentation and graphs.

The current recession and, especially, the related financial panic in the fall of 2008 have given rise to an extraordinary surge in the U.S. government’s size, scope, and power. As I write, the financial panic has subsided, but the recession, already the longest since the 1930s, seems likely to continue for a long time. Even when it has passed, however, the government will certainly retain much of the augmentation it has gained recently. Hence, this crisis will prove to be the occasion for another episode of the ratchet effect in the growth of government.

According to the National Bureau of Economic Research, the recession began early in 2008, but the decline became severe only in the latter part of the year. The financial panic that came to a head in late September 2008 proved to be the catalyst for an accelerated decline in real GDP and rise in the rate of unemployment. The so-called credit crunch in the fall of 2008 prompted the Fed, the Treasury, and the Congress to take a series of extraordinary actions in quick succession.

In September 2008, the Federal Reserve System (“the Fed”) took control of the insurance giant American International Group (AIG), and the Federal Housing Finance Authority took over the huge government-sponsored enterprises Fannie Mae and Freddie Mac, secondary lending institutions that held or insured more than half of the total value of U.S. residential mortgages. On October 3, the president signed the Emergency Economic Stabilization Act, which, among other things, created the Troubled Assets Relief Program (TARP), authorizing as much as $700 billion for the purchase of so-called troubled assets, primarily mortgage-related securities, held by banks and other financial institutions. Instead of making the authorized purchases, however, the Treasury used the TARP to inject funds into the banks by purchasing their preferred shares. In this way, the government acquired an ownership interest in nearly 600 commercial banks.

Meanwhile, the Fed made a series of unprecedented types of asset purchases and loans, loan guarantees, and asset swaps, and provided other forms of assistance to securities dealers, money-market mutual funds, Fannie Mae, Freddie Mac, the Federal Home Loan Banks, Citigroup, fourteen foreign central banks, and buyers of certain asset-backed securities based on consumer and small-business loans. As a result, the monetary base of the United States increased by more than 100 percent between August 2008 and January 2009.

After Barack Obama became president, Congress passed the American Recovery and Reinvestment Act, authorizing a variety of federal spending increases and some tax reductions over the period from 2009 to 2019. According to estimates by the Congressional Budget Office, the combined amount of these spending increases and tax cuts comes to $787 billion over the ten-year period.

These actions, among others, caused federal outlays to jump by 24 percent in fiscal year 2009, raising the U.S. government’s spending from 21 percent of GDP to 26 percent. They also increased the budget deficit by 246 percent, to approximately $1.6 trillion. Public debt held by the public rose from $5.8 trillion to $7.6 trillion during the course of fiscal year 2009, a 31 percent increase. These spending and borrowing surges will certainly have very long-lasting consequences.

Although these consequences are now in large part unavoidable, amelioration of their harm, as well as the prevention of similar government actions in a later crisis, requires a renewed commitment to liberty and a heightened understanding of its attainment and preservation. Toward these ends, the Independent Institute continues to work relentlessly.

One day Team Obama announces a plan for enhanced rescission authority to impound wasteful spending, and the next day the House surfaces a plan for $200 billion in “stimulus” spending on transfer payments for welfare, even more unemployment compensation, still more Medicaid, and a bunch of special-interest subsidies.

So are we to believe that Obama will rescind the excess appropriations? Hardly. And since pay-go is dead, most of this new spending will not be offset. It will add to deficits and debt.

It’s the Greek disease. The welfare state run amok. Right here at home.

And in true class-warfare style, a small portion of the $200 billion is supposed to be offset by jacking up capital-gains taxes for investment partnerships. If passed, this would reduce investment, jobs, and economic growth, and enlarge the deficit. Higher spending and investment taxing is a true austerity trap.

This business of raising the tax rate on investment partnerships would be a particularly onerous burden on American entrepreneurs. And it would put this country at a decided disadvantage to our competitors in China and elsewhere in Asia (outside of Japan).

Increasing the tax rate on the investment portion of these partnerships (i.e., the capital gains) would boost the penalty rate from 15 percent to 38 percent — and that includes the Obamacare payroll tax on investment scheduled for 2013.

So, instead of keeping 85 cents on the extra dollar earned from high-risk investment, the House proposal would drop the return to only 62 cents — a whopping 27 percent incentive rollback. And by the same amount, it would raise the cost of new capital, draining investment liquidity from the private sector in order to finance government transfer payments.

Nothing could be worse. This is spread-the-wealth in its most crass form.

And if all that weren’t bad enough, the House proposal would tax the so-called enterprise value of these firms by applying the same penalty-rate structure on the sale of all or part of an investment partnership. In other words, it would make real-estate, venture-capital, and private-equity firms the only businesses in the country that are ineligible for long-term capital-gains treatment when they are sold in full or part.

One private-equity partner tells me that this would “tear apart the incentives for innovation that have been at the foundation of American enterprise since 1921, when the capital-gains differential vis-à-vis ordinary personal tax rates was first created.”

Compounding matters, we read in USA Today this week that private-sector personal incomes are at an all-time low, while government benefits as a share of income stand at an all-time high. I believe this is called redistribution.

And then comes a study from the Harvard Business School that states: “Stimulus Surprise: Companies Retrench When Government Spends.” What a shocker. (Hat tip to economist Don Luskin.)

House Democrats apparently don’t read newspapers from Greece or the United States. And they sure don’t read Harvard B-School studies.

The Democrats are trying to cram through another special-interest piece of legislation, which they are calling (depending on the audience) either a tax-extenders bill or a stimulus bill. But they’ve been having trouble getting enough votes for this motley collection of welfare-state provisions and special-interest tax breaks, in part because of the public’s growing hostility to wasteful and corrupt Washington spending. The proposal finally has been approved by the House, but only after the leadership made some (mostly cosmetic) changes to  get the votes of a sufficient number of gullible “Blue Dog” Democrats.

The Blue Dogs claim to be fans of fiscal responsibility, but they look at the issue through a very distorted lens. As the Obamacare vote demonstrated, they will vote for big and bloated government so long as the new spending is “offset” – at least on paper – by big tax hikes. This is one of the reasons why Pelosi & Co included billions of dollars in corporate tax hikes in the tax-extenders/stimulus legislation.

What the Democrats (either the blue or pink variety) apparently don’t understand, though, is that corporations don’t pay taxes. Yes, companies often write checks to the IRS, but all corporate taxes are really a burden on workers, consumers, and shareholders. Moreover, in a world where jobs and investment can cross borders looking for better tax policy, a high corporate tax rate is a huge competitive liability for a nation. These are some of the main points in this video on corporate taxation.

Unfortunately, America’s corporate tax rate is among the highest in the world. The federal tax rate is 35 percent and state corporate tax systems push the overall tax rate up to about 40 percent. According to KPMG, this gives America the 3rd-highest corporate tax rate (out of 116 jurisdictions) in KPMG’s annual survey behind only the United Arab Emirates and Japan (and tied with Libya). We do “better” in the PWC/World Bank study of the total tax rate, scoring 118 out of 179 nations. But beating Argentina and the Central African Republic is hardly something to brag about. A new Cato Institute study looking at effective corporate tax rates, meanwhile, shows the United States with the highest burden of all developed nations.

With numbers like this, no wonder some American companies have decided to move to other nations, with some even choosing Canada. Yet rather than fix the problem with a lower corporate tax rate, Obama and the Democrats want to increase the company tax burden – particularly on American multinationals that are trying to compete in global markets. Fortunately, that proposal is temporarily stalled, but with deficits and debt at record levels and almost no appetite for genuine spending restraint on Capitol Hill, this almost certainly means that politicians will continue to look at companies as potential ATM machines to finance bigger government. That’s good news for China and India, but bad news for American workers.

The Democrats are trying to cram through another special-interest piece of legislation, which they are calling (depending on the audience) either a tax-extenders bill or a stimulus bill. But they’ve been having trouble getting enough votes for this motley collection of welfare-state provisions and special-interest tax breaks, in part because of the public’s growing hostility to wasteful and corrupt Washington spending. The proposal finally has been approved by the House, but only after the leadership made some (mostly cosmetic) changes to  get the votes of a sufficient number of gullible “Blue Dog” Democrats.

The Blue Dogs claim to be fans of fiscal responsibility, but they look at the issue through a very distorted lens. As the Obamacare vote demonstrated, they will vote for big and bloated government so long as the new spending is “offset” – at least on paper – by big tax hikes. This is one of the reasons why Pelosi & Co included billions of dollars in corporate tax hikes in the tax-extenders/stimulus legislation.

What the Democrats (either the blue or pink variety) apparently don’t understand, though, is that corporations don’t pay taxes. Yes, companies often write checks to the IRS, but all corporate taxes are really a burden on workers, consumers, and shareholders. Moreover, in a world where jobs and investment can cross borders looking for better tax policy, a high corporate tax rate is a huge competitive liability for a nation. These are some of the main points in this video on corporate taxation.

Unfortunately, America’s corporate tax rate is among the highest in the world. The federal tax rate is 35 percent and state corporate tax systems push the overall tax rate up to about 40 percent. According to KPMG, this gives America the 3rd-highest corporate tax rate (out of 116 jurisdictions) in KPMG’s annual survey behind only the United Arab Emirates and Japan (and tied with Libya). We do “better” in the PWC/World Bank study of the total tax rate, scoring 118 out of 179 nations. But beating Argentina and the Central African Republic is hardly something to brag about. A new Cato Institute study looking at effective corporate tax rates, meanwhile, shows the United States with the highest burden of all developed nations.

With numbers like this, no wonder some American companies have decided to move to other nations, with some even choosing Canada. Yet rather than fix the problem with a lower corporate tax rate, Obama and the Democrats want to increase the company tax burden – particularly on American multinationals that are trying to compete in global markets. Fortunately, that proposal is temporarily stalled, but with deficits and debt at record levels and almost no appetite for genuine spending restraint on Capitol Hill, this almost certainly means that politicians will continue to look at companies as potential ATM machines to finance bigger government. That’s good news for China and India, but bad news for American workers.

With the government takeover of healthcare becoming law and our ever-increasing national debt weighing down on our children’s future, Washington’s agenda looks nothing like the American peoples agenda. It’s no wonder people all across America are continually asking the same question: why isn’t Washington listening to us?

I’ve had enough. Have you? Well, here’s a new outlet - www.AmericaSpeakingOut.com – to voice your ideas to change America. This is an outlet where these ideas will not fall on deaf ears. Together, we can create something new, something bold, and something to act as a check and balance to Washington’s out-of-touch agenda. And we can work to craft this agenda now, instead of waiting to let more bad policy go unchecked. The stakes are just too high to wait any longer. American families continue to struggle from job losses month after month, all while Congress continues to increase Washington spending, pile onto the debt, mettle with American free enterprise, and ignore national unemployment that hovers near ten percent.

Thankfully, millions of Americans are engaged and continue to offer ideas, even though the majority in Congress shuns the idea of listening to the people. As a Member of the minority in the House of Representatives, I’ve seen this firsthand. I held two healthcare town halls last summer, and about five thousand people showed up to overwhelmingly support saying no to the government takeover of healthcare. But, Washington did not listen to our voices, and the voices of countless other Americans. Instead, the backroom deals prevailed over the majority of America. Well, we can change that. That is why were trying something different.

Unlike this Congress and Administrations we know best, business-as-usual arrogance, we are actually going to involve the American people in building an agenda. Why? Because it’s the peoples House. It’s your government, not Washington’s. From social media like Facebook and YouTube, to mobile apps, to traditional town hall setting, to a central forum: AmericaSpeakingOut.com, we have built a process where Americans can speak out and share their ideas and solutions for the challenges our country faces. Many conservatives have already begun to put forth positive solutions for a new agenda, and we want those and other ideas. Whatever the topic, whether it’s the economy, spending, values, national security, we want to hear from the American people.

As conservatives, we know our principles, and we also know the best ideas do not always come from Washington. In Washington, we’ve seen enough tax hikes, government takeovers, bailouts, and other big government solutions under Speaker Pelosi’s control. So, while suggestions like raising taxes or growing government won’t be a part of our agenda, we aren’t afraid to debate them in an open forum. Like many of you, I believe in a free market of ideas and not shying away from debate. Remember, this Democratic-controlled Congress needs to continue to hear who is really in control of government. It is the people.

Now, some will probably attack America Speaking Out for partisan reasons or to distract from the problems with Washington. But, we shouldn’t fear this process. We know the stakes are too high and America has reached a tipping point. We’re here to change that. So, let your voice be heard. Speak out and get America back on successful path, create a new future that allows us and our children to succeed, and create a check and balance to what is going on in Washington. Please join us at www.AmericaSpeakingOut.com

General strikes in Greece have brought much of the country to a halt as trade unions and government workers stage more protests over austerity measures.  A 24-hour work stoppage  last week closed much of the country’s public sector and shut down  ferries, trains and public transport.

So here  is one unfunded social utopia’s score card so far:  Three have died already this month in massive riots  in the streets of Athens which are in danger of re-erupting anew.  Paralyzing strikes from civil servants, so used to getting so much largess for doing so little for so long.   A  $145 billion bailout is in jeopardy with the big dogs of the EU, Germany chief among them, expressing serious concerns that the austerity measures demanded of Greece as a condition to merit the loans will ever come to fruition.  Given the revised deficit projections and a public that seems unwilling to admit that their free ride brand of socialism as expressed in a financially unsustainable pension structure is collapsing, who can blame Europe?

Greece is bankrupt.   Their debt is 108% of GDP and will climb to almost 150% by 2013 when the bailout loans would come due.  25% of Greek taxes will go to service its debt — to mostly foreign investors.  Currently that nation’s government spending amounts to 50% of its GDP.

Consider then that in 2009 US debt was 86% of GDP and climbing.  It will go past 100% by 2012.  20% of U.S. federal taxes go to service the interest on the national debt.  That number too will rise.  Our major social entitlement programs of Social Security, Medicare and Medicaid, are bankrupt.  We are waging foreign wars almost entirely on our own—so that Europe doesn’t have to.  And now we have just enacted the mother of all entitlements in Obamacare  that only the most wishful of thinkers (or a cynical Democratic Congress and White House) would argue is anything but a multi-trillion dollar debt dog pile on top of an already strained budget.

Of course our gargantuan economy is much more vibrant, diverse and robust than Greece’s.  But we are already seeing within our borders mini-Greeces popping up at the state level.  41 states currently face budget shortfalls and the effects are already being felt.  Here in New Jersey, school districts have suffered state aid cuts of 95%.  (And in a little taste of the new entitlement mentality, our teachers’ union insisted on ramming through a contractually obligated pay raise anyway that would benefit the union bosses most of all; Trenton’s financial woes be damned.  So to make the numbers work, several teachers and other staff got the axe—fortunately without any rioting.)

What is currently unfolding on the chaotic streets of Athens is an immovable force of a deep-seeded entitlement culture  unwilling to give up its government goodies standing up to the irresistible force of simple mathematics.   Care to bet on what side will ultimately prevail?

I am not saying that the United States is making the exact mistakes as the Greeks.   But we are on a parallel course in that we are spending more on government programs than we are taking in in revenue.  So whereas Greece is collapsing under the weight of  unfunded pensions and ridiculously generous retirement packages and entitlements, while at the same time suffering a shrinking tax base, we have our own issues as I said before with Social Security (bankrupt seven years earlier than predicted just two years ago), Medicare, Medicaid and Obamacare.

Edwin LeFevre once wrote that:

“A man, if he is both wise and lucky, will not make the same mistake twice.  But he will make any one of the ten thousand brothers and cousins of the original mistake.”

As we watch the inevitable fissures in European style socialism breaking wide open for all to see, this is a most propitious time to turn inward and ask ourselves if the model that American left seems so stubbornly intent on replicating here even works, let alone is best for our nation?  The Tea Partiers are but one expression of this necessary dialog — shameful left-wing race-baiting notwithstanding.  Ponzi schemes always come to the same dismal end, leaving some poor unfortunates to pay the bill.

I would just like to know what makes liberal Democrats think that the inevitable reality of a seriously flawed socio-economic dogma now violently on display in the streets of Athens (and poised to spread throughout Europe) will somehow pass us by if we follow the same path?   And if we continue down their road who do they believe will bail us out when the bill comes?

The America COMPETES Act, first signed into law three years ago, is a very popular bill because it provides funding for basic research, math and science education, and aims to improve our Nation’s competitiveness in the world.  Because COMPETES is so popular, everyone wants a piece of the pie.

In 2007, the House-passed bill was a $24 billion package.  However, the 2010 version was $96 billion, as introduced. Numerous new and unnecessary programs were added, and other programs were expanded well beyond the original scope and intent of the 2007 bill.  Even after a few very modest concessions, this reauthorization still spends twice as much as the original bill.

Regardless, a lot of people were disappointed when two weeks ago it was pulled from the House floor before final passage, and then again last week when it was defeated by a straight up or down vote.  Voting against a popular bill is a tough choice.  However, I and many of my Republican colleagues voted ‘no,’ not because we want to play political games, but because we believe the bill can be better.

The vote to improve the bill came on May 13^th in the form of a Motion to Recommit (MTR), which passed the House with bipartisan support, by a vote of 292 to 126, resulting in the Democrats’ decision to pull the bill from consideration.  Blogs and a few editorial boards have been openly critical of this attempt to improve the bill, going so far as to say it was instead an effort to “kill” or “derail” the COMPETES reauthorization.

Democrats argue that the MTR included a difficult-to-vote-against provision that would disallow funds from paying the salary of any government employee disciplined for viewing or downloading pornographic material on his or her work computer.  I believe the “porn” provision has merit in addressing a very serious policy issue. I believe what is overlooked is that the MTR also included very substantive provisions to address Republican concerns raised throughout the legislative process.

The MTR cut new and duplicative programs, increased Congressional oversight over the effectiveness of the programs, and most importantly, cut spending by over $40 billion.  I stand by this effort to cut spending and improve the bill.  I was disappointed that the Democrats decided to pull the bill, rather than let the full House vote on it.  I believe the improved version would have passed by an overwhelming margin.

Mr. Norman Ornstein, in a May 19 Roll Call editorial, questioned the legitimacy of the MTR and noted that COMPETES enjoyed broad bipartisan support in 2007 and “little division or controversy” this year.  What is overlooked is that this bill is definitely not the same bill that passed in 2007.  No one is more respected than Mr. Ornstein, and no one questions the thrust of COMPETES.  We simply want the funds to be spent wisely, as suggested in the MTR.

The original COMPETES was a targeted investment in basic research, based on the recommendations of the National Academy of Sciences.  This reauthorization, however, includes massive spending increases, new duplicative and unnecessary programs, and shifts focus away from basic research and toward technology commercialization activities.  At all stages of the legislative process, Republicans offered dozens of amendments attempting to address these very valid concerns.  Unfortunately Republicans have run into roadblocks.  Of the 54 amendments permitted to be considered on the House floor, 50 were Democratic while only 4 were Republican. With very few exceptions, Democrats successfully blocked GOP amendments from consideration.

Last week, Democrats made a second attempt to pass a new version of the bill under an expedited process that does not allow for further amendments, but requires a two-thirds majority of votes to pass.  The new bill, H.R. 5325, included all 52 amendments adopted during the consideration of H.R. 5116 the previous week, but only two of the six provisions from the successful Republican MTR.

Most Republicans again voted ‘no’ not because we don’t support innovation, but because we do believe these investments are vitally important.  We want a better, more streamlined bill that remains focused on investing in strong basic research – not creating duplicative clusters and hubs, in addition to loan guarantees and advertising campaigns.

Declaring Republicans to be “obstructionist” fails to take into account the responsibility of all Members of Congress to provide due diligence when spending taxpayer dollars.  Simply put, we’re doing what we were elected to do as representatives of our constituents.  In the true spirit of bipartisanship, let’s work together  to improve this bill, restrain spending, cut duplicative  programs, focus on priority basic research and pass this important piece of legislation.

Rep. Ralph Hall (R-TX) is Ranking Member of the House Committee on Science and Technology

Violent protests by public employees  in Greece who are upset that they might have to give up their 13th and 14th months salary is the ultimate sign of dependency. The private sector behaved slightly better but still opposed the changes (“We want the government to take back these measures which freeze our pay rises and force us to stay longer in the workforce,” said Maria Grigoropoulou, a cosmetics store employee. )

These guys seem unable to conceive that they could take care of themselves for a change and not just receive money from the government in exchange for nothing. And yet the Greek austerity plan isn’t that austere ( some wage cuts for public workers, a three-year freeze on pensions and a second increase this year in sales taxes and the price of fuel, alcohol and tobacco,) especially compared to the self-imposed austerity plans in Lithuania and Latvia.

With that in mind, let’s look at what’s happening in the United States. Obviously, we are not Greeks. Yet, the level of dependency is growing in America. Check out this chart.

On this chart we can see the changes over time in the composition of personal income in the United States since 1929. The most notable trend is the increase in the portion of personal income coming from government transfers (mainly social Security payments, unemployment benefits, food stamps, and personal and business tax credits.)  And the increase isn’t minor: the proportion of total personal income constituted by government money has grown from 0.9% to 17.2%.

While we may agree that safety nets are okay during hard times, this is not what’s going on here. Government transfers increased even during good times. It means that more people are getting more of their income from government transfers.

Complementary decreases of wage earnings as percentages of total personal income (from 59.5% to 52.3%) are also going on. This is not good news.

A must read in today’s New York Times: (it happens)

With the Senate’s passage of financial regulation, Congress and the White House have completed 16 months of activity that rival any other since the New Deal in scope or ambition. Like the Reagan Revolution or Lyndon Johnson’s Great Society, the new progressive period has the makings of a generational shift in how Washington operates.

First came a stimulus bill that, while aimed mainly at ending a deep recession, also set out to remake the nation’s educational system and vastly expand scientific research. Then President Obama signed a health care bill that was the biggest expansion of the safety net in 40 years. And now Congress is in the final stages of a bill that would tighten Wall Street’s rules and probably shrink its profit margins.

If there is a theme to all this, it has been to try to lift economic growth while also reducing income inequality. Growth in the decade that just ended was the slowest in the post-World War II era, while inequality has been rising for most of the last 35 years.

It is far too early to know if these efforts will work. Their success depends enormously on execution and, in the case of financial regulation, specifically on the Federal Reserve, which did not distinguish itself during the housing bubble.

Already, though, one downside to the legislative spurt does seem clear. By focusing on long-term problems, Mr. Obama and the Democrats have given less than their full attention to the economy’s current weakness and turned off a good number of voters.

After months of discussion, and with the unemployment rate hovering near a 27-year high, Democratic leaders said Thursday they had finally reached agreement on a bill that would send aid to states and take other steps to increase job growth. Congress plans to vote on the bill next week. But some of the money will not be spent for months and may not be enough to affect voters’ attitudes before November’s midterm elections.

Still, the turnabout since Jan. 20 — the first anniversary of Mr. Obama’s inauguration and the day after Scott Brown, a Republican, won a Senate seat in liberal Massachusetts — has been remarkable. Then, commentators pronounced the Obama presidency nearly dead. Today, he looks more like a liberal answer to Ronald Reagan.

“If you’d asked me about this administration after Scott Brown was elected, I’d have told you it was going to fizzle into virtually nothing,” said Theda Skocpol, the Harvard political scientist. “Now it could easily be one of the pivotal periods in domestic policy.” But, Ms. Skocpol added, “It will depend on what happens in the next two elections.”

Continue reading here. Ms. Skocpol is right; the next two elections will be decisive. You can’t say you weren’t warned.

Maryland’s intrepid state Delegate Pat McDonough has announced a plan to deal with illegal immigration in Maryland similar to the law recently passed in Arizona. He will introduce this bill in the next legislative session. Maryland’s Montgomery County Gazette issued a predictably critical assessment of the plan, saying McDonough, “never let political reality stand in the way of his crusades,” and declared his proposal dead on arrival before it has even been introduced.

The Gazette response, typical of leftist news media everywhere, displays in microcosm the arrogant myopia that is driving newsrags out of business across this nation. Who in God’s green earth do these people think they are? When and how can any problem be addressed if every controversial proposal is attacked and written off before it is even aired? This is precisely the kind of attitude that gave rise to the Tea Party movement and it is causing a seachange in national politics. The Gazette should take note. Trouble is, liberals are so smug and self-righteous, they can’t see reality even when it is dangled in front of their noses.

Unfortunately, it is the rest of us who pay for their self-serving, destructive polices, and we are frankly fed up. Arizona Governor Jan Brewer deserves credit for braving the denizens of political correctness to enact the Arizona bill. She has set off a chain reaction that has already seen similar legislation proposed in at least nine other states.

Before they start criticizing the Arizona law, which mirrors federal law – not that such irony would ever stop them –  Obama and the Democrats should read the sixteen page bill. Or maybe they should learn why it is the federal government’s failure that prompted passage of the law in the first place. The Montgomery County Gazette got exactly one sentence correct in their diatribe against McDonough when they said, “The federal government basically has abdicated its would-be, should-be role.”

Of course they immediately negated any hope of intellectual redemption by reverting to form and advocating for Congress’s latest try at an amnesty bill.

Oh yes, the Democrats and maybe one or two really stupid Republicans are proposing immigration “reform” like they did in 2007. But as in 2007, it is nothing more than an amnesty bill, and we already know from the 1986 law, that amnesty doesn’t work. It didn’t work then and it won’t now.

But that fact is irrelevant to Democrats, because it is not designed to work. It is designed, like practically everything else that Democrats do, to undermine the rule of law and overwhelm federal, state and local crimefighting, health and welfare budgets according to the Cloward-Piven Strategy of Manufactured Crisis, while securing more reliable voting blocs. This last is an especially high priority for the Obama administration and Congress this year because they are going to need every vote they can get to keep power, and they know it.

The Los Angeles Times, which seems to be coming somewhat to its senses lately (it correctly recognized Senator Barbara Boxer as not having “adequate intellectual firepower” for the job) had the decency to allow Dan Stein of the Federation for American Immigration Reform to make the case for the Arizona law in an OpEd. But that the Gazette, or the Baltimore Sun for that matter, should be so open to first amendment expression. To wit:

• [Arizona] state taxpayers spend more than $2 billion a year on education and healthcare for illegal immigrants and their children
• kidnappings in Phoenix are at an all-time high
• criminal drug, illegal immigrant and other contraband smuggling is epidemic
• Arizonans have endured decades of federal neglect of immigration enforcement
• killing last month of rancher Robert Krentz — police suspect by an illegal immigrant — is only the latest graphic example of widespread lawlessness on the border

The left deliberately raises the strawman argument of “racism” and “racial profiling” to distract from these critical realities. Arizona’s problems are being replicated all over the country as a flood of illegal immigrants, including criminals, terrorists and gangs bring with them violence, diseases once thought to be eradicated, like tuberculosis, and overwhelming burdens to our welfare system, the courts and medical facilities.

A  2006 report from the Dallas Morning News spotlights just one of these issues. The Emergency Medical Treatment and Active Labor Act of 1986 requires hospitals to accept pregnant women in need of emergency help, and imposes a $50,000 fine for violations, so no hospital can turn down illegals. But Parkland Memorial Hospital in Dallas, Texas goes further, offering free prenatal care to pregnant mothers.

Not surprisingly, Parkland gets the lion’s share of indigent and illegal immigrant mothers. Some of its statistics are eye-popping. For example, a 2006 patient survey indicated that 70 percent of mothers who gave birth at Parkland in the first three months of that year were illegal immigrants. In 2004, the hospital spent $70.7 million delivering 15,938 babies.

Yet Parkland is proud of its service to the community and is not troubled by the high cost. As Parland’s CEO said, “We are the safety net hospital for Dallas County, and these folks are residents of our county.” Nice sentiment, but as always, the wise bet is to follow the money. Parkland earned a profit of $7.9 million in obstetrics that year – a hefty 10 percent return! Nice work if you can get it.

So who pays for this cadillac care to indegents and illegals, many of whom are taking advantage of the services to have anchor babies? According to the News article, about $44 million came from state and federal Medicaid funds while Dallas County taxpayers shelled out $31.3 million.

Once again, the taxpayer is on the hook so why should the hospital care?

Like the Arizona law, Del. McDonough’s proposal would give law enforcement the teeth it needs to tackle this problem. And in Maryland, thanks to the Democrats’ sanctuary state policies, the problem is immense. According to a report by the Federation for American Immigration Reform:

• There are currently about 250,000 illegal immigrants in the State of Maryland.
• Illegal immigrants cost Marylanders $1.4 billion per year in education, medical care and incarceration. This represents 70 percent of Maryland’s current $2 billion budget deficit.
• Between 2002 and 2008, the foreign-born population in Maryland grew by 34.6 percent. Meanwhile, the number of students requiring english instruction has grown a whopping 93.7 percent!
• Marylanders spend more than $966 million annually on education for an estimated 80,800 children of illegal aliens.
• nearly $250 million additional is spent on providing special English instruction to an estimated 35,000 children of illegal aliens.
• Almost 10 percent of public school children in Maryland have illegal immigrant parents.
• These costs would be considerably higher if other cost areas such as assistance programs for needy families or welfare benefits for American workers displaced by illegal alien workers or resulting from depressed wages were included in the calculation.

Given the high proportion of mindless living in Maryland, McDonough may well be tilting at windmills, but the worm is turning, and if someone doesn’t act nothing will happen.

In an interesting development the House Armed Services Committee unanimously approved legislation that would block Gitmo, Illinois from coming to fruition. In fact, they’ve blocked any Gitmo terrorist from being transferred anywhere into the interior of the USA. This is a blow to Obama’s desires to shut Gitmo down and to bring terrorists to a prison near you.

Wednesday the committee approved a defense bill for 2011 that includes language to prevent moving detainees into any US facility inside our borders and also blocked any funding to even study the possibility.

The bill does, however, state that the Secretary of Defense must submit to Congress a full report that “adequately justifies” any such proposal in the future which seems to signal that they haven’t shut the door on the possibility of a later opening of a detainee facility inside US borders.

This would appear to be a case of Congress telling the president that he overstepped his position when he announced that he had the power to transfer terrorists to the states.

You might recall that that in December of 2009, Barack Obama’s Justice Department issued a memo authorizing the transfer to Illinois of terror suspects being housed at Guantanamo Bay. In December, Obama tried to invoke his powers as commander-in-chief of America’s armed forces as the authority by which he could commandeer the Thomson Correctional facility in Illinois and place Gitmo terror suspects there for housing. This was a desperate effort not to make the lie to his 2009 executive order setting a Jan. 2010 deadline for shutting down the Guantanamo facility — a deadline he’s missed badly.

But now Congress is slapping his hand and telling him that “memo” or no, he can’t transfer terrorists to facilities inside US borders and even if he thinks he does have that power, Congress won’t pay for it all.

Amusingly, the New York Times tried to spin this as the Republican’s fault. After noting that Obama missed his own self-imposed, one-year deadline to close Gitmo, The Times tries to make readers think that this newest setback it is all because of those mean ol’ Republicans that are blocking Obama’s valiant efforts.

Mr. Obama had declared he would close the prison within a year of taking office. The administration argues that Guantánamo is a symbol used for terrorism recruitment, so closing it would enhance national security.

But many Republicans have maintained that Guantánamo should stay open, arguing that the Thomson plan would waste money and create a national-security risk. Some libertarians also oppose institutionalizing indefinite detentions without trial on domestic soil.

Newsflash, NYT, this approval to block Gitmo, Illinois was unanimous. If you need help with that big word it means all the Democrats on the committee voted to block their own president’s Gitmo plans. And this is not to mention that the Democrats control Congress and could easily have approved of Obama’s plans if they had wanted to.

The more interesting story, NYT, might be to ask why all the Democrats voted to block Obama on this. I guess that is too much like work for the Times, though.

So, no Gitmo, Illinois any time in the near future. Now, I wonder if the extreme left will begin to call Obama a war criminal and torturer for not closing Gitmo like they did Bush for all those years? Do you hear that? It’s crickets. They love the sound of crickets in the morning.

Article I, section 2, of the Constitution requires the populations of the various states to be enumerated every 10 years. The first such census was conducted in 1790; its main purpose was to apportion seats in the House of Representatives among the original 13 states.

The Founders scarcely could have foreseen the stunningly costly and politically sensitive undertaking the census now has become.

There is much at stake. Census figures will be used to shift representation in Congress from states where populations have declined since 2000 to those where they have grown. By 2012, every state also will have redrawn its own legislative district boundaries to reflect recent population trends.

Moreover, the 2010 headcount will determine how every state and community fares over the next decade when federal funds are allocated for a host of social programs, including health care and job training; highway, bridge and tunnel construction; public education; and much else. The jackpot of taxpayer-financed loot to be doled out based on census results now amounts to about $400 billion. With federal spending reeling out of control, billions more likely will be up for grabs.

How much will it cost to count noses this year? No one really knows. The Census Bureau began planning for 2010 immediately after 2000. It is not yet fully ready. Preparations for 2010 have been plagued by fraud, cost-overruns and failures of computer hardware and software.

In a report published in June 2006, the Government Accountability Office raised grave concerns about the transparency and accuracy of the bureau’s cost estimates for the 2010 census, citing among other things assumptions about savings that would be realized by equipping census workers with hand-held mobile computing devices rather than paper forms (although potentially fatal problems with those devices had been evident in 2004 field tests) and the absence of a strategy for updating address and map files for areas impacted by hurricanes Katrina and Rita.

Even then, the 2010 census promised to be the most expensive in history, estimated to cost $11.3 billion, after adjusting for inflation.

The GAO was prescient. Hand-held computing devices have been abandoned and paper census forms will again be used. The Census Bureau is scrambling to implement a paper-based operations control system (PBOCS) for tracking submitted forms and, more important, to coordinate visits by census workers to every household that fails to return the form it receives in the mail. (Non-response is the census’s main cost driver.) But PBOCS itself has suffered serious technical problems in the few areas where it has been deployed.

Meanwhile, estimated costs have skyrocketed to $14.7 billion. According to February 2010 testimony by the Commerce Department’s Inspector General, the Census Bureau routinely has overspent on pre-census activities. It budgeted $356 million for address canvassing in 2009 and exceeded it by 25 percent ($88 million).

And the main show is still to come.

The bureau will spend $338 million on advertising and promotional materials (produced in 28 languages) meant to persuade people to complete and return their census forms.

The 2010 Census of Population will be, by all appearances, a major boondoggle. The only saving grace is that the “long-form” has been dropped in favor of the “short form,” thereby economizing somewhat on respondents’ time. Still, based on current estimates, it will cost an average of $47 per person to conduct this year’s head count—not including the value of householders’ time filling out paper forms.

The Census Bureau initially planned to allow people to respond to its queries online, but canceled that option in the face of privacy concerns. Along with other IT misfires, the 2010 census essentially will be conducted the same way it was in 1790—and may well be less accurate.

One would hope that by 2020, census bureaucrats will at long last move forward from the 18th century into the 21st century and take advantage of modern computer-based information technologies. Considering its performance leading up to the 2010 census that hope is faint.

U.S and world stock markets are slumping badly as intensified systemic risks from the Greek and European debt-default contagion continue to spread. Disciplinarian markets of stocks, bonds, gold, and currencies are signaling the inadequacy of European Union rescue plans and the global fear that economic recovery will be blunted.

Europe is the main source of the current upheaval. Specifically, the biggest issue right now is short-term funding. Key funding risk indicators, such as LIBOR and various short-term swap spreads, are showing credit and liquidity stress in Europe. Interbank funding looks increasingly sloppy and worrisome. These are dangerous market signals.

The repo market for bank-to-bank loans was the source of the credit freeze back in the fall of 2008. And while today’s funding risks are not even remotely as bad as they were back then, liquidity stresses seem to worsen with the passing of each day. If these funding problems keep worsening, along with stock markets that keep declining, all hell will break loose. Another meltdown is possible.

So I have a thought.

In the autumn of 2008, when financing markets completely froze up during the very worst of the credit meltdown, the FDIC guaranteed all bank debt, from 30 days out to 30 years. In addition, the Fed and Treasury essentially guaranteed overnight lending in the repo market and the commercial-paper market for bank debt. It worked.

At the time, the repo market for interbank loans was about $20 trillion, vastly greater than the $1.2 trillion volume of subprime mortgages. And when the repo market was rescued through the loan guarantees, the financial system gradually started to heal — although it took several months. (An end to mark-to-market accounting in March 2009 would aid that healing process.)

So it’s my contention that the Europeans must now embark on a similar program. The EU/IMF rescue plan, which consists of $1 trillion in loans and loan guarantees for government sovereign debt, must be expanded to include a blanket loan guarantee for all European bank debt, short term and long term. A Europe-wide, centralized, deposit-guarantee system should also be developed. Right now bank deposits are insured by individual countries, like Greece. This is not credible. (Hat tip to investor David Kotok for this deposit-guarantee thought.)

A loan-guarantee program to backstop the banks in Europe and sovereign debt will put an end to this crazy Greek drama that is pulling down markets everywhere and threatening the economic recovery. As a free-market advocate, I don’t like this sort of government intervention. But we’re talking emergency here. Systemic global emergency.

In the U.S., the loan-guarantee blanket was a vastly more efficient and cheaper way to rescue the financial system than the $700 billion TARP plan to inject money into the banks. Unlike TARP, which still lives on, the loan guarantees were removed in 2009.

So the Europeans must be bolder and more aggressive with their financial safety net. And if a program like this were to be announced, in all likelihood the guarantees would never have to be funded, or wouldn’t really be necessary. In other words, the safety net will be a lot cheaper than simply pouring more loan subsidies into Europe’s welfare state.

These bank-loan guarantees would be temporary, perhaps a year in length. And they would buy time for the essential budget restructuring necessary to slash spending and curb the welfare-state excesses in southern Europe, or perhaps all of Europe. These government-shrinking steps will free up private-sector resources to spur growth.

It may also be necessary to restructure the Greek debt, with creditors taking a haircut. But a big-bang approach to backstop Europe’s banks and its bad-behaving, out-of-control-spending countries is, I believe, a necessary step in halting the contagion threats and restoring calm to the stock markets and financial system.

After several brutal years of recession, the possibility of global recovery must be strengthened by emergency actions from Europe. The world has already suffered enough. That’s why a guarantee safety net — one that must be conditioned on a radical restructuring of Europe’s sad budget affairs — is a necessary emergency measure.

And make no mistake about it. The U.S. is part of the budget disarray. Right now, the U.S. government bond market is getting a pass from the European funding crisis. But that pass will not be forever. Even while American corporations have returned to profitability, the sagging U.S. stock market and rise in the dollar/gold price are huge warnings to Washington, D.C., that a radical budget adjustment must be put on the table immediately.

Just as a frog will jump out of a hot frying pan, but will sit in water that slowly goes from cold to hot until he cooks to death; California’s politicians have sat quietly as the accumulation of chronic budget deficits bubbling up from an uncomfortably warm problem to a scalding hot crisis.  Even the release of Governor Schwarzenegger’s $19.1 billion budget deficit projection for the coming July fiscal year appears to have failed to bludgeon the state’s political establishment into action to avoid a looming credit rating downgrade to sub-prime that would set off a Greek style default on steroids.

The media, after months of missing the potential consequences of a Greek default, have now become focused on the similarities between California and Greece.  Both do owe gobs of money, have huge budget deficits, massive unfunded pension liabilities and can’t print their own money; but California’s situation is worse!  The California economy is 5 times larger than the Greek economy.  Los Angeles alone is twice the size of the $356 billion Greek economy.  Greece is less than 2.5% of the European Union (EU) economy, but California is over 13% of the US economy.  From 2000 to 2008, the Greek economy grew at 3.1% annually, the second fastest growth in Europe, whereas California’s growth of 2.3% during the same period was only slightly better than the rest of the US.  Greek unemployment just hit a crisis 12.1%, unemployment in California is 13% and has been above Greece’s since the start of the year.

What started out a month ago with Greece having trouble making a $10 billion debt payment has mushroomed into a worldwide liquidity crisis.  Germany and France have been forced to lead a $1 trillion bailout.  Even the U.S. was required to kick in $50 billion to the support International Monetary Fund’s contribution.  For a few days this block-buster financial backstop calmed the bond markets and allowed short-term interest rates across Europe to decline, but by the end of the week Greek interest rates were headed back up.

Chief Executive Josef Ackermann of Deutsche Bank, Germany’s largest financial institution, said last week he was “doubtful whether Greece will really be in a position to achieve” the repayment of the emergency loans.  However, he went on to stress that Athens had to be propped up, because if it fell, it would lead “with great certainty to a spillover to other countries,” sparking “a type of meltdown,” he added.  Ackermann’s comments are all the more surprising because they follow recent reports that Deutsche Bank itself is preparing to provide €500 million ($625 million) in loans to Greece on the same conditions as those set by the German government.

Last September the state of California sold $8.8 billion of prime rated short term debt to investors at an interest cost of 3%, similar to rates Greece was paying before the threat of default sent the rate to 24%.  The Governor Schwarzenegger’s new budget projections indicate that California will need to borrow $12-15 billion just to get through the fall.  Given that state’s economy is five times larger than Greece, if California is downgraded to sub-prime this fall and the crisis spreads to  municipalities and other states, it might take up to a $5 trillion bailout to stabilize the situation.

The world would expect the U.S. Government to provide an American solution for a California debt crisis.  But unlike Germany and France, who as the largest member states in the European Union were politically forced to shoulder the majority of the $1 trillion bailout of little Greece, expecting the America’s smaller states to have the political will and the financial wherewithal to bailout giant California is much more problematic.

The International Monetary Fund estimated the ratio of the United States national debt to Gross Domestic Product was 82% versus Greece at 115% as of last year.  A $5 trillion American led bailout would immediately push the U.S. ratio to Greek levels.  With all the losses the U.S. banks are suffering from real estate foreclosures, they have no capacity to aid in the bailout the U.S. federal government.

There is precious little time for their own survival for California’s political establishment to come together on a program of at least $15 billion of spending cuts to offset the state’s cash shortfall.  German Chancellor Angela Merkel’s Christian Democratic Party just lost an election for control of the upper house of Germany’s Parliament last week as voters punished her party for making Germans have to pay for what they see as Greek irresponsibility and political corruption.

Voters across the nation are becoming increasingly frightened by the rising U.S. national debt.  If California continues the status quo and finds itself on the verge of default this summer, their fellow Americans might just demand that the state suffer the full consequences of their deficit spending ways.  Unfortunately for the world economy, a sovereign default by an entity the size of California could set off a massive liquidity crisis and push the world’s economy into another deep recession or worse.

Just as a frog will jump out of a hot frying pan, but will sit in water that slowly goes from cold to hot until he cooks to death; California’s politicians have sat quietly as the accumulation of chronic budget deficits bubbling up from an uncomfortably warm problem to a scalding hot crisis.  Even the release of Governor Schwarzenegger’s $19.1 billion budget deficit projection for the coming July fiscal year appears to have failed to bludgeon the state’s political establishment into action to avoid a looming credit rating downgrade to sub-prime that would set off a Greek style default on steroids.

The media, after months of missing the potential consequences of a Greek default, have now become focused on the similarities between California and Greece.  Both do owe gobs of money, have huge budget deficits, massive unfunded pension liabilities and can’t print their own money; but California’s situation is worse!  The California economy is 5 times larger than the Greek economy.  Los Angeles alone is twice the size of the $356 billion Greek economy.  Greece is less than 2.5% of the European Union (EU) economy, but California is over 13% of the US economy.  From 2000 to 2008, the Greek economy grew at 3.1% annually, the second fastest growth in Europe, whereas California’s growth of 2.3% during the same period was only slightly better than the rest of the US.  Greek unemployment just hit a crisis 12.1%, unemployment in California is 13% and has been above Greece’s since the start of the year.

What started out a month ago with Greece having trouble making a $10 billion debt payment has mushroomed into a worldwide liquidity crisis.  Germany and France have been forced to lead a $1 trillion bailout.  Even the U.S. was required to kick in $50 billion to the support International Monetary Fund’s contribution.  For a few days this block-buster financial backstop calmed the bond markets and allowed short-term interest rates across Europe to decline, but by the end of the week Greek interest rates were headed back up.

Chief Executive Josef Ackermann of Deutsche Bank, Germany’s largest financial institution, said last week he was “doubtful whether Greece will really be in a position to achieve” the repayment of the emergency loans.  However, he went on to stress that Athens had to be propped up, because if it fell, it would lead “with great certainty to a spillover to other countries,” sparking “a type of meltdown,” he added.  Ackermann’s comments are all the more surprising because they follow recent reports that Deutsche Bank itself is preparing to provide €500 million ($625 million) in loans to Greece on the same conditions as those set by the German government.

Last September the state of California sold $8.8 billion of prime rated short term debt to investors at an interest cost of 3%, similar to rates Greece was paying before the threat of default sent the rate to 24%.  The Governor Schwarzenegger’s new budget projections indicate that California will need to borrow $12-15 billion just to get through the fall.  Given that state’s economy is five times larger than Greece, if California is downgraded to sub-prime this fall and the crisis spreads to  municipalities and other states, it might take up to a $5 trillion bailout to stabilize the situation.

The world would expect the U.S. Government to provide an American solution for a California debt crisis.  But unlike Germany and France, who as the largest member states in the European Union were politically forced to shoulder the majority of the $1 trillion bailout of little Greece, expecting the America’s smaller states to have the political will and the financial wherewithal to bailout giant California is much more problematic.

The International Monetary Fund estimated the ratio of the United States national debt to Gross Domestic Product was 82% versus Greece at 115% as of last year.  A $5 trillion American led bailout would immediately push the U.S. ratio to Greek levels.  With all the losses the U.S. banks are suffering from real estate foreclosures, they have no capacity to aid in the bailout the U.S. federal government.

There is precious little time for their own survival for California’s political establishment to come together on a program of at least $15 billion of spending cuts to offset the state’s cash shortfall.  German Chancellor Angela Merkel’s Christian Democratic Party just lost an election for control of the upper house of Germany’s Parliament last week as voters punished her party for making Germans have to pay for what they see as Greek irresponsibility and political corruption.

Voters across the nation are becoming increasingly frightened by the rising U.S. national debt.  If California continues the status quo and finds itself on the verge of default this summer, their fellow Americans might just demand that the state suffer the full consequences of their deficit spending ways.  Unfortunately for the world economy, a sovereign default by an entity the size of California could set off a massive liquidity crisis and push the world’s economy into another deep recession or worse.

Just as a frog will jump out of a hot frying pan, but will sit in water that slowly goes from cold to hot until he cooks to death; California’s politicians have sat quietly as the accumulation of chronic budget deficits bubbling up from an uncomfortably warm problem to a scalding hot crisis.  Even the release of Governor Schwarzenegger’s $19.1 billion budget deficit projection for the coming July fiscal year appears to have failed to bludgeon the state’s political establishment into action to avoid a looming credit rating downgrade to sub-prime that would set off a Greek style default on steroids.

The media, after months of missing the potential consequences of a Greek default, have now become focused on the similarities between California and Greece.  Both do owe gobs of money, have huge budget deficits, massive unfunded pension liabilities and can’t print their own money; but California’s situation is worse!  The California economy is 5 times larger than the Greek economy.  Los Angeles alone is twice the size of the $356 billion Greek economy.  Greece is less than 2.5% of the European Union (EU) economy, but California is over 13% of the US economy.  From 2000 to 2008, the Greek economy grew at 3.1% annually, the second fastest growth in Europe, whereas California’s growth of 2.3% during the same period was only slightly better than the rest of the US.  Greek unemployment just hit a crisis 12.1%, unemployment in California is 13% and has been above Greece’s since the start of the year.

What started out a month ago with Greece having trouble making a $10 billion debt payment has mushroomed into a worldwide liquidity crisis.  Germany and France have been forced to lead a $1 trillion bailout.  Even the U.S. was required to kick in $50 billion to the support International Monetary Fund’s contribution.  For a few days this block-buster financial backstop calmed the bond markets and allowed short-term interest rates across Europe to decline, but by the end of the week Greek interest rates were headed back up.

Chief Executive Josef Ackermann of Deutsche Bank, Germany’s largest financial institution, said last week he was “doubtful whether Greece will really be in a position to achieve” the repayment of the emergency loans.  However, he went on to stress that Athens had to be propped up, because if it fell, it would lead “with great certainty to a spillover to other countries,” sparking “a type of meltdown,” he added.  Ackermann’s comments are all the more surprising because they follow recent reports that Deutsche Bank itself is preparing to provide €500 million ($625 million) in loans to Greece on the same conditions as those set by the German government.

Last September the state of California sold $8.8 billion of prime rated short term debt to investors at an interest cost of 3%, similar to rates Greece was paying before the threat of default sent the rate to 24%.  The Governor Schwarzenegger’s new budget projections indicate that California will need to borrow $12-15 billion just to get through the fall.  Given that state’s economy is five times larger than Greece, if California is downgraded to sub-prime this fall and the crisis spreads to  municipalities and other states, it might take up to a $5 trillion bailout to stabilize the situation.

The world would expect the U.S. Government to provide an American solution for a California debt crisis.  But unlike Germany and France, who as the largest member states in the European Union were politically forced to shoulder the majority of the $1 trillion bailout of little Greece, expecting the America’s smaller states to have the political will and the financial wherewithal to bailout giant California is much more problematic.

The International Monetary Fund estimated the ratio of the United States national debt to Gross Domestic Product was 82% versus Greece at 115% as of last year.  A $5 trillion American led bailout would immediately push the U.S. ratio to Greek levels.  With all the losses the U.S. banks are suffering from real estate foreclosures, they have no capacity to aid in the bailout the U.S. federal government.

There is precious little time for their own survival for California’s political establishment to come together on a program of at least $15 billion of spending cuts to offset the state’s cash shortfall.  German Chancellor Angela Merkel’s Christian Democratic Party just lost an election for control of the upper house of Germany’s Parliament last week as voters punished her party for making Germans have to pay for what they see as Greek irresponsibility and political corruption.

Voters across the nation are becoming increasingly frightened by the rising U.S. national debt.  If California continues the status quo and finds itself on the verge of default this summer, their fellow Americans might just demand that the state suffer the full consequences of their deficit spending ways.  Unfortunately for the world economy, a sovereign default by an entity the size of California could set off a massive liquidity crisis and push the world’s economy into another deep recession or worse.

Last Wednesday, I announced on Big Government the launch of a new initiative that would enable taxpayers to directly propose federal spending cuts on the House floor. Today, over a quarter-million Americans will get to see whether their representatives in Congress share their specific fiscal priorities.

For those who hunger to hold their elected officials accountable for perpetuating a culture of reckless runaway spending in Washington, meet YouCut.

This first-of-its-kind interactive initiative empowers taxpayers with direct democracy at a time when their faith in Congress’ fiscal prudence has reached its lowest. YouCut allows the public to vote each week on one of five wasteful spending items that they would like to strip from the federal budget. Once the votes are tallied, Republicans force a vote on whether or not to take up and debate the cut on the House floor.

During the first week, a plurality of voters – over 81,000! – chose to axe a recently created $2.5 billion annual welfare program that undercuts cost-saving welfare reforms made in the mid 1990’s.  Within 5 days of the experiment, 280,000 Americans have cast a vote either online or by text message.  At several points, more than 5,000 votes were being cast per hour, with less than one percent of votes originating from inside the beltway.

The overwhelming response speaks to the extreme levels of frustration that you feel toward a Congress that refuses to listen to you.  Over the last decade, taxpayers have grown weary of the incessant federal spending binges – no matter which party has been in power. They now look across the Atlantic with horror as Europe collapses under the weight of its own debt. Fear that America will go down the same road has only amplified calls for spending restraint.

Through YouCut, concerned citizens are cracking through the wall of resistance put up by big spenders in Washington to create a new culture of savings. This poses a threat to several in Congress who are invested heavily in preserving the status quo – hence the Democratic National Committee’s vigorous effort to discredit the program.  Worse, rather than listening to the hundreds of thousands of Americans, Tim Kaine (Chairman of the DNC) and Chris Van Hollen (Chairman of the DCCC) chose to mock the opinions of those who voted.  Not listening – a common theme for Democrats.

Driven by a new generation of young and energetic leaders, today’s GOP understands that we were fired from the majority because we abandoned the fiscal principles we had been sent to Washington to uphold. After two terms in the minority, we are eager to restore our reputation as responsible custodians of taxpayer money. It is this commitment to eliminate the prevailing wink-and-a-nod approach to unnecessary spending that spawned YouCut.

This week citizens can choose among the following items:

1. Byrd Honors Scholarships ($42 million in savings in the first year -$420 million over ten years) Even the Obama Administration proposed terminating this program in their annual budget.  Surely Congress can too.
2. Eliminate the Proposed Federal Employee Pay Raise (saves approximately $2 billion in the first year, $30 billion over ten years).  President Obama proposed providing federal civilian employees with a 1.4% pay raise next year. This year Federal employees received a 2% raise and since the year 2000 have received raises averaging 3.6% a year. USA Today recently reported that the typical federal worker is paid 20% more than a private-sector worker in the same occupation. This proposal would expand upon the just enacted legislation to prevent Members of Congress from receiving a pay raise and would not impact the scheduled pay raise for those serving in the military.
3. Suspend Federal Land Purchases ($266 million in savings in the first year, $2.66 billion over ten years).  Last year Congress spent $266 million acquiring additional federal lands at the Departments of Interior and Agriculture, a 138% increase over the comparable amount of funding just four years ago. Given that the federal government already owns 29% of the land in America and has a multi-billion dollar maintenance backlog to maintain current land holdings, suspending new federal land would permit the government to focus on maintaining existing property while also saving taxpayers millions of dollars a year.
4. Terminate Funding for UNESCO ($81 million in savings in the first year, $810 million over ten years).  Last year the administration proposed deleting the Department of Education’s attaché to UNESCO saving approximately $632,000 a year. Terminating U.S. support for UNESCO entirely would save taxpayers $81 million annually. The U.S. had not supported UNESCO for 19 years prior to the decision by the Bush Administration to rejoin in 2003. UNESCO routinely undertakes activities that are properly the responsibility of individual countries and their governments, including reviewing and making recommendations in areas related to education, arts, culture, ethics, science and technology, and historic preservation. UNESCO recently came under fire for their proposed International Guidelines for Sexuality Education.  Membership provides little benefit to American taxpayers in light of the overall cost.
5. Eliminate Mohair Subsidies (approximately $1 million in savings in the first year, $10 million over ten years).  Federal price support for mohair was first enacted in 1947, and the National Wool Act of 1954 established direct payments for wool and mohair producers. The purpose was to encourage production of wool because it was considered an essential and strategic commodity.  According to the Congressional Research Service, no similar purpose was stated for the mohair program. While this program was phased out in 1995, ad hoc payments were provided in 1999 and 2000 and the program was reinstituted in 2002. Eliminating this program once again would save taxpayers approximately $1 million a year. (Also proposed as part of the RSC Sunset Caucus.)

Again, cutting any one these programs is not going to erase our debt or deficit in one shot.  But, it will begin to change the focus in Washington from spending to saving, from growing to cutting.  That’s why we need your help.

Please take just a few seconds to us in this effort. YouCut offers all Americans the ability to change the wasteful ways of Washington.  To be sure, 280,000 votes is a great number.  But to bring real change, rather than mere lip service, we need many more people to stand up and participate. The louder our voice, the harder it becomes for Speaker Pelosi to ignore.  Visit www.republicanwhip.house.gov/youcut to cast your vote now.

President Obama is coming to Youngstown today to tout his administration’s recovery efforts, but its policies are only making matters worse in the Mahoning Valley.

While it’s encouraging that the factory in Youngstown that the president will visit on Tuesday has recently expanded, the city’s painfully high 15.1 percent unemployment rate is a harsh reminder that the “stimulus” has not created jobs “immediately,” or held our national unemployment rate (9.9 percent) below eight percent as the president promised.

Worse yet, the policies of the Obama Administration could quickly put jobs at the factory, which manufactures steel pipes for oil and gas drilling, on the chopping block as it continues to push a “cap-and-trade” national energy tax that will raise energy prices, drive thousands of American jobs overseas to countries with less-stringent environmental regulations, and devastate our domestic oil and gas industries.

Last December the administration unilaterally acted to pave the way for this bureaucratic nightmare, and it’s not looking back. In fact, last week the EPA finalized new rules for manufacturers and power plants scheduled to go into effect in January of next year, regulations that American Iron and Steel Institute President and CEO Thomas Gibson warns “will impose significant new costs on manufacturing industries at the worst possible time… [and] arbitrarily picks winners and losers.”

This disturbing trend of harmful government overreach is only increasing as the administration uses taxpayer bailouts and a bevy of new powers to aid special-interest allies and inject politics into every corner of America.

Just look at the government role in the unequal treatment of thousands of Ohio retirees of the now bankrupt auto parts manufacturer Delphi Corporation.  More than 20,000 Delphi salaried retirees, many of whom live in the Youngstown and Dayton areas, face the loss of health care coverage and up to 70 percent of their monthly pension checks, while obligations to the former company’s union retirees are being covered in full by government-owned General Motors.

Americans across the country are watching this, and they’re saying ‘enough is enough.’

They’re tired of the payoffs, kickbacks and sweetheart deals for Washington’s special-interests.

They are scared as they watch government spend like there is no tomorrow, piling more and more debt on the backs of our children and grandchildren.

And they don’t want the president’s new health care law, which will punish small businesses and states with new mandates, cut Medicare benefits for seniors, and actually increase health care costs, according to a recent report from analysts at the administration’s Center for Medicare and Medicaid Services.

Already, 20 states have filed suit in court to block the law’s costly mandates.  On Friday, the National Federation of Independent Business (NFIB), which represent the nation’s small businesses, announced it will join these efforts to overturn the president’s health care overhaul due to concern it will hurt our economy and prevent the creation of American jobs.

Republicans are listening to these concerns, and we’re offering better solutions to help middle-class families and small businesses tackle the challenges they are facing every day.

We want to repeal the president’s jobs-killing health care law, and replace it with real reform to lower costs.  We want to put an end to taxpayer bailouts, and get the government out of the business of picking winners and losers in the private sector.

And we are offering an “all of the above” energy strategy to create jobs, lower energy costs, and establish a cleaner more reliable energy future, solutions to curb government spending, and a jobs plan to help small businesses create jobs.

President Obama has billed his ‘Main Street’ tour as a ‘listening tour.’  As Ohioans continue to ask “Where are the jobs?” it’s time for the president to scrap his job-killing agenda, and work with Republicans on these types of better solutions to help create new jobs and get our economy moving again.

As of yesterday, the first 100,000 of my We the People pamphlets have been requested and read throughout all 50 states and the District of Columbia.

The origins of the We the People pamphlets are admittedly humble.  I simply straggled into my garage and booted up a beat up lap top to honor the numerous requests to put my extemporaneous speeches on paper.  I typed, tossed in some pictures, designed the artwork and – voila! – the pamphlets were born (and my “Honey Do” list grew to Rita’s annoyance).  The pamphlets weren’t polled, because they don’t pander to prevailing opinions; and no focus group was used, because my garage isn’t big enough to hold one.

With no Washington “roll out” and scant notice from the pundits and political class, the intense grassroots reception of the We the People pamphlets is inspiring.  People are eager for the GOP to reaffirm its enduring goals and permanent principles; and, most importantly, to implement them and transcend the great, generational challenges facing America.

Thus, take heart despite the times:  America’s salvation remains her free people; and, because of them, our nation’s greatest days await!

To order your copy of “We the People:  Champions of Freedom” click here or go to www.McCotterRocks.com.

It takes a special ad to get a candidate for Senate so upset they hire lawyers to censor it. But that is what is happening in Illinois as the Alexi Giannoulias campaign has unleashed its lawyers on television stations who have been carrying this ad:

The facts of the ad are indisputable but not to Alexi Giannoulias and his trial lawyer buddies. They sent this letter to the stations demanding censorship because they claim the FDIC bailout of the Giannoulias family owned bank was not a “bailout.”

Letter to Station and System Managers[1]

The Giannoulias family bank — Broadway Bank — used its depositors money to loan money to the mob characters and fugitives of the law. Those benefiting from the lending practices of the Giannoulias family include Boris Stratievsky, a fugitive of the law who built a money laundering network received received more than $10 million from Broadway Bank. Giannoulias bankrolled Michael ‘Jaws’ Giorango, a Chicagoan twice convicted of bookmaking and promoting prostitution.

It’s little surprise that the Broadway bank failed, needing the FDIC to come in and rescue depositors money. That, my friends, is a bailout. Without the help of the Feds, depositors would have been ruined.

Comcast Chicago has blinked and are refusing to run the ad. Whether citizens ever get to see this ad, one thing is for sure, the Giannoulias campaign has made a fatal error by entering this debate. They have given the ad more attention that it might have gotten and they have awakened Illinois citizens about the scandal.

It is not the magnitude of the rapidly collapsing Greek economy that should concern us in America.  It is, rather, that Greece is unquestionably the proverbial canary in the coal mine that should have the American ruling class burning the midnight oil to extract us from the mess they and their predecessors have created for us.  Instead, our government is ignoring the warning.

The left in America, has flirted with the European economic welfare paradigm for years and now we have an Administration that has morphed that flirtation into a full blown love affair.  Greece, which has spent itself into oblivion providing unsustainable benefits (mostly to ever-growing public payrollers) is, we are told, an aberration and the Administration will, no doubt, say the same thing about Portugal and Italy and Ireland too.  But then we have Spain and Great Britain and even France (and let’s not forget Iceland) staggering down the same path toward economic never-never land, all suffering from the same delusional affliction that is now being pursued with gusto by our ruling class…the belief that we can best improve life for all Americans, nearly half of whom pay no taxes, by raising taxes on the declining number of Americans who do.

The left has always believed that prosperity is something that can be bought through government taxation of society’s income, rather than something that is simply a by-product of society’s productivity.  Let us say it again.  Government cannot create sustainable wealth or prosperity.  Only the people, individually and through the commercial and industrial institutions they create, can do that.

Healthy societies are growing societies that earn the means (the capital) for reinvestment in continued health and growth.  In this process of market-driven growth everyone who participates eventually prospers. Healthy societies are not those such as we are witnessing in Europe, whose earnings are sucked dry by government for redistribution to accomplish objectives as dictated by government planners.   Yet it is this withering European model that our current Administration and its congressional majority have embraced, notwithstanding the warnings screaming at us from across the Atlantic and throughout nearly every precinct in America.  President Obama has stated, unambiguously, that he personally believes that at some level of income no one needs to earn any more, presumably the point at which government should take the balance for redistribution. He acknowledged, however, that this view was, “not the American way.”

While there are structural differences between the debt-laden welfare states of Europe and America, there are very frightening similarities between the course we are now pursuing and the course that has brought so much of Europe to such sorry circumstance.  The primary difference, of course, is that Euro-denominated states cannot monetize the burgeoning debt created by their own individual budget deficits.  That is, they do not have the ability to devalue a national currency as we can by printing more of it.  That is because the twenty-seven Euro countries are all yoked to the Euro.   That said, the problem being experienced in Europe is not, at its core, currency driven.  It is caused by excessive overborrowing to support programs that cannot be paid for from current revenue, which results in accumulated debt that cannot be retired through economic growth because the debt service burdens consume the capital which would otherwise be available to create that growth.

Greece, like the other PIGS countries (Portugal, Italy, Ireland and Spain) as well as Great Britain, France and Iceland got into so much hot water (or red ink) by spending (and committing to spend in the future) far more money than their already high tax rates could fund, so they borrowed with the same abandon that the United States is now funding its commitments.  They, like the United States, have turned time and time again to taxes and debt to stay afloat but never to sustained reductions in spending.  Never, of course, is a very long time and, in Europe, time has finally run out.  The creditor nations (or, we should say, the central banks of the creditor nations) have had enough and severe spending cuts are being imposed on Greece, as they surely will be on the other high spending countries of the EU if defaults on national debt are to be avoided.

One in three Greeks work for the government and they enjoy higher wages and better benefits than their countrymen working in the private sector.  The people who have been manning the barricades and rioting in Greece are not primarily the unemployed or under employed. To the contrary, they are the well and very securely employed and many are eligible to retire after 35 years of service at eighty percent of their highest salary after which they continue to be eligible for government paid health plans and other perks.  The reality is that they are being paid with money their government doesn’t have and can no longer borrow.  That is the real cause of the violent backlash to the bitter medicine the creditor nations are requiring of Greece and soon will be requiring of the other newly debt-burdened nations of Europe.  It is also ironic that it is government employees who are rioting against the government they serve, in opposition to the consequences of the policies they themselves put in place.

Perhaps, we in America shouldn’t be too hasty in our criticism of Greece (or the other PIGS) and its bloated public payroll.  The American taxpayer is funding quite a public sector gravy train too.  Federal, state and municipal payrolls have actually increased during the recession both in numbers employed and wages paid.  To make it worse, President Obama announced last week a program to make it easier to apply for and land a government job.  His objective, he says, is parity with the private sector.  However, recent data shows that the average public employee in America already earns significantly more than his private sector counterpart.  Real wages are significantly higher in the public sector and public sector benefits are exceedingly higher than private sector benefits.

Private sector wages and benefits must ultimately come from the income of private enterprises.  Public sector wages and benefits come primarily from the taxes paid by private sector employees and the companies that employ them.  We certainly don’t begrudge paying anyone an honest day’s pay for an honest day’s work whether they work in the public or the private sector.  But we certainly understand the palpable angst in the country engendered by an ever-growing and over-reaching public sector.

There was a time when most people understood that public sector jobs that were funded by private sector taxes may not have paid quite as well as private sector jobs, but that the benefits were generally more attractive.   Federal employees earn thirteen days of vacation leave a year for the first three years of service, twenty days a year for the next twelve years and twenty-six days a year after fifteen years of service.  And that is in addition to thirteen days of sick leave each year.  Today, however, those same federal employees are, according to the Bureau of Labor Statistics, on average, also earning significantly more in wages for doing comparable work and the federal payroll has also been expanding throughout the recession while virtually all sectors among private enterprises have been contracting.

The same phenomenon is taking place on the local level as well, where public employee unions have negotiated for early retirement and lifetime pensions and health benefits which have exhausted state and municipal budgets and sent government officials scurrying to enact new taxes and to charge new and increased fees on almost every municipal service.  Park in front of your own home…pay the government; plant a tree…pay the government; need a bag to carry your groceries…pay the government.

Someone once said that nothing and no one is all bad.  And we suppose we can find some good in the debacle unfolding in Greece and elsewhere in Europe.  It is, after all, an incredibly fortuitous wake-up call for America.  As Yogi Berra once said, “when you come to a fork in the road…take it.”  We are at Yogi’s fork in the road.  Our public debt (on-balance sheet debt) does not yet mirror that of Greece (114% of GDP) or the other PIGS of Europe.  Our consolidated obligations, however,  (public debt added to our unfunded liabilities and the public debt and unfunded liabilities of our states and municipalities) are astronomical.  The federal unfunded liabilities alone stand at just under $110 trillion, or many times more than our entire GDP.

With the price of an ounce of gold having now broken through the $1200 threshold and with the EU’s leaders having just announced a $1 trillion rescue package to help steel world financial markets against blow-back from the mess in Greece, we in America must stop and reassess what we are doing and where we are going.  We have to slash every dime of unnecessary spending.  Even our own Secretary of Defense has urged cutting back on the substantial bloat in defense spending. Every other agency should do the same.

Perhaps, most importantly, we need seriously to think anew about which needs in our daily lives are personal responsibilities and which are the roles of government. In other words, we need seriously to reconsider the very essence of America’s social contract.  Expanding government’s role in health care, and mandating expanded Medicaid costs to states, many of which already have busted budgets, attempting to control through regulation, and yet new taxes, the wax and wane of climate change, turning a blind eye toward skyrocketing pork and earmarks, rapidly expanding the federal payroll and spending trillions to stimulate an economy that just needs the federal government to get out of its way does not augur well for the economic health of the country.

We should stop and rethink raising taxes that will retard economic growth and reduce individual initiative and productivity.  We have no chance of avoiding a PIGS type debt crisis without sustained robust economic growth. Capital formation and investment should be encouraged, yet we are about to raise tax rates on capital appreciation. Corporations should be encouraged to distribute dividends from earnings beyond that which is needed to fund growth, yet we are about to triple the tax rate on distributed dividends (even though earnings from which dividends are paid are already fully taxed at corporate tax rates). Everyone should pay a fair tax, yet nearly half of our tax filers pay no taxes at all, and those who pay the most are about to have their taxes raised.  Our unfolding tax policy may be good for those engaged in cultivating class warfare, but it will not be good for the American economy since it will suck finite resources from those people and businesses upon whom we must rely for that very growth.  Ultimately, this boils down to a political decision.  If Americans want everything from government, then the price will be paid in both diminished American growth and economic power.  We simply cannot have it both ways.  Reality has caught up with smoke and mirrors and the proverbial piper is knocking on the door and demanding to be paid.

Greece and the other PIGS of Europe needn’t foreshadow America’s coming attractions. What is currently unfolding across the Atlantic needn’t be a prediction of what is soon going to happen here.  Greece may well be the economic Dunkirk of 21^st century Europe.  We should make sure it is a morning wake-up call for America and not a national nightmare.

Widely reviled by the left, Bush’s faith-based initiatives were claimed to be evidence that Bush was a “religious zealot” trying to destroy America with evil Christianity. Now, two years into the Obama administration, we are seeing what Obama intends to do with his continuation of Bush’s faith-based offices: he wants to use them to push the religion of Greenicanism on America’s churches.

This month Obama’s Advisory Council on Faith-Based and Neighborhood Partnerships issued its final report of recommendations and the result is nothing short of astonishing. (download .pdf file)

The question that immediately comes to mind, of course, is if the left will explode in excoriation of Obama’s faith-based policies as it did with Bush’s?

The left was out of its mind over Bush’s ideas. In 2004, for instance, the website TheocracyWatch.org hyperbolically said, “Under the Bush administration, our country is experiencing a major transformation from a secular to a religious government. The President’s faith-based initiative is central to this transformation and raises serious questions about church-state separation.” This was the left-wing talking points du jour on Bush’s faith-based programs.

It wasn’t just the left, but even from the libertarian side Bush’s ideas were attacked. Alex Epstein of the Ayn Rand Institute said that the faith-based initiative was a “direct violation” of the Constitution.

And the media universally hated the idea. Lew Daly of Boston Review magazine tried to color Bush’s program as a “seismic change in American politics,” and for The New York Times Ron Suskind breathlessly burbled that Bush had, “created the faith-based presidency.” And those were what passed for the civil proclamations, others were more nutty by claiming that Bush was a religious zealot that was destroying the country through that evil Christianity stuff.

Candidate Obama was widely expected to dispense with the faith-based office. But in 2008 when the AP reported that Obama intended to leave the Bush faith-based programs in place, the left was apoplectic. Rev. Barry Lynn, executive director of Americans United for Separation of Church and State criticized Obama over it. “I am disappointed that any presidential candidate would want to continue a failed policy of the Bush administration,” Lynn said. “It ought to be shut down, not continued.”

After the AP’s report candidate Obama himself spun reports as a distortion. In July of 2008, Obama addressed the issue in a speech in Zanesville, Ohio.

“Now, make no mistake, as someone who used to teach constitutional law, I believe deeply in the separation of church and state, but I don’t believe this partnership will endanger that idea – so long as we follow a few basic principles. First, if you get a federal grant, you can’t use that grant money to proselytize to the people you help and you can’t discriminate against them – or against the people you hire – on the basis of their religion. Second, federal dollars that go directly to churches, temples, and mosques can only be used on secular programs. And we’ll also ensure that taxpayer dollars only go to those programs that actually work.”

As with most things that Obama says, this claim that was then. While Obama is following the left-wing penchant to eschew actual religiosity, Obama has apparently decided that his own special brand of religion would be what is promulgated with his continuation of Bush’s faith-based policies. The money he’s spending to “proselytize” his green ideas apparently doesn’t strike him as a violation of his 2008 proclamations.

Recently Meghan Clyne wrote an excellent piece in the Weekly Standard that detailed how Obama is using his faith-based program to push global warming, climate change, and green initiatives on America’s churches and he’s doing so by brazenly coupling his faith-based council with the Environmental Protection Agency.

Apparently, the president’s council envisions the “partnership” between government and religious institutions as a means of spreading the administration’s environmental warnings, rather than just a way to help churches feed the hungry and clothe the poor. Faith-based organizations, the report notes, can take “a prominent leadership role in influencing policy, education, and action in those areas.”

…The council hopes the new EPA faith office will also help churches and other nonprofits improve “access to financing,” including “establishing revolving loan programs or working with utility companies to help finance greening building projects.” The ultimate aim of all this government-supported retrofitting is clear: “Regional staff would work to engage local faith-and community-based groups to help meet Obama administration targets for greening buildings and promoting environmental quality.”

So, Obama wants to use federal subsidies offered through he EPA and his faith-based outreach to get churches to promulgate the green faith.

Of course, it’s hard to see Obama’s use of faith-based initiatives to push his environmental message and spending millions of tax dollars to do so differs in any material way when measured by the left’s anti-Bush yard stick when they criticized his policies. The left universally cried that Bush was cynically using religion to further his political policies. No one can look at Obama’s current policies and see any reason to excuse him from being smeared with the same brush the left used to tar Bush.

Clyne also makes a seminal point. “Perhaps it’s only reasonable that global-warming activists would turn to God for help as the scientific case for their position collapses,” Clyne wrote. It’s all as if “Climategate had never happened,” she says.

It is indeed.

With corruption and abuse running rampant in Washington, D.C. coupled with a historic debt and massive deficit that some believe has the United States following in the footsteps of Greece, one would think the appropriators in Congress would concerns themselves with unnecessary and excessive spending, yet they are doing just the opposite.

The acquisition process related to the defense industry is a place where both Members of Congress and industry lobbyists have made a pretty good living by sending pork home and enriching the underbelly of the nation’s capital in the process.

Exhibit A: C-17

The facts are that the C-5 transport plane is being modernized to supplant the C-17 transport plane at a reduced cost.  The Air Force has repeatedly stated that it does not want any more C-17s, yet Congress continues to fund new ones adding $1.5 billion to this year’s budget for five more, after it added $2.5 billion to last year’s budget for 10 more.

But what’s $4 billion among friends when your country has a long-term deficit over 10 trillion dollars?

Secretary Gates has openly campaigned against any new C-17s, stating emphatically that he will recommend a Presidential veto of any appropriations bill that includes new ones.  Gates has said, “The leadership of the Air Force is clear: they do not need and cannot afford more C-17s.”  Any questions?

And here comes the kicker.  Just the other day, Senate Appropriations Committee Chairman Inouye was covered in a defense industry publication stating more money would be appropriated for the C-17.  Inouye said, “Asked if he is trying to fund more C-17s in the fiscal year 2011 defense appropriations bill, Inouye replied: ‘I think the House will do so.’  Senators, he added, ‘usually go along with’ such action by the House.”

At a time when the deficit is exploding and we are mortgaging our children’s future, powerful Members of Congress continue to support defense systems that serve as nothing more than pork-barrel projects that even the military brass say we don’t need or want.

At what point do we ask, when is enough enough?

Just when we thought flag@whitehouse.gov–which appears to be alive and well when clicked–was scary and invasive–it seems the Obama administration’s Census Bureau has outdone itself.  A US census worker, driving a metallic gray Ford Taurus-type car, has been reported to be combing through the Memphis, TN suburb of Germantown knocking on doors asking people for information on their neighbors.

Yes, you read that correctly. The US census worker was asking how many people lived in the house next door on or about April 1, 2010. As if there wasn’t enough controversy with the census already, this just adds fuel to the fire.

According to the source, here’s what happened when Obama’s Orwellian Big Brother knocked:

The census worker identified himself, showed his credentials, and continued to ask if she knew if the house next door was occupied on April 1 of this year.  The census worker also indicated that he had “difficulty” contacting the neighbors.  After the source confirmed the house was occupied on April 1st, the census worker continued by asking, “How many people occupied that house?”

My source responded by saying, “If they haven’t filled out their census, I can’t help you and I have no intention of telling you anything about my neighbors and your recourse is to enforce your penalties.”

The worker replied, “Well you know why we take the census don’t you?”

My source replied, “Yes, in this case, to redistribute my wealth.  And you are not permitted to ask me about my neighbors.”

The worker went on to say that the census is used to figure out the number of representatives and federal monies that would be allocated.  The source still refused to answer and the census worker was asked to leave the property.

He then proceeded to knock on the other neighbor’s doors, apparently, to get the information he was sent our for.  Let’s just hope that these people are not attorneys because this is a clear violation of the privacy and security procedures of the census to ensure an accurate and secure count.  Nowhere in this information does it say your neighbors can provide census information.

In addition to this, last evening another source–in the neighboring suburb of Cordova, TN–had a 15-minute telephone conversation with a US census worker. The census worker asked questions regarding anyone currently living in a nursing home, a child’s address at college (when the student already filled out a census form), handicapped persons in the household, and anyone who may have lived there on April 1, 2010 and moved out after April 1, 2010.

This is a clear abuse of the protocols set forth to ensure the accuracy, privacy, and security of the census.  Additionally, I find it disturbing that so many items from the Obama administration need branding and clarification, including the census, healthcare, immigration, global warming [rebranded to] climate change, and basically any other issue they take on. Everything is broken, has been branded, and has a rhetoric-laden marketing plan.  Oddly, this administration shuns the branding of products, foods, and the very companies that create jobs for millions of Americans.

For those on the left who cling to the old-school, no rules, free-living, liberal-Democrat roots, it’s time to wake up and see how alarming and further polarizing this move on the part of the government truly is. When will the mask of “good will” be ripped off the left and understood for the intrusive nature and oppression that it entrenches.  This administration has continually displayed, through their sophomoric agitation of the people, that they have no conscious when it comes to pitting Americans against one another to achieve their goals.

On a final note, it should be reassuring to the people of Tennessee that the Obama administration does indeed know that the people of  TN exist.

After three weeks, most Americans still do not understand all of the behind-closed-door deals that had to be cut on the $965 Billion dollar bailout of Greece.  It’s yet another complicated deal, with little transparency to let non-governmental folks understand the specifics.

But, I do understand the power of a dream that can inspire a new generation.  And I know that Obama just killed that dream.

Obama’s decision to expand bailouts to include Greece coincided with a Senate hearing on another decision Obama  made to cut funding for a government space travel program, killing the dream of a permanent station on the Moon or a landing on Mars.

As an unintended, but cruel, joke,  Obama’s decision to retreat from space exploration has been pushed as an example of  the President’s fiscal discipline.  No doubt, Obama was hoping that such cuts would mask the fact that  he has endorsed the greatest deficits spending in the history of the United States.

But, as with many of Obama’s posturings, fiscal discipline was a canard.  Obama’s decision to cut NASA’s space travel wasn’t fiscally disciplined, it was just ill-informed.

Let’s take another look  at these two decisions.

First,  The proposed bailout of Greece and EU involves a $325 billion dollar loan/bailout package from the International Monetary Fund (IMF).  Since the United States is 17% of the IMF, the pro-rata share of US funding via IMF for the bailout of Greece is approximately $55 billion dollars.

Given the open ended nature of the American commitment (i.e. Fed Reserve entered into an unlimited dollar swap agreement) along with the near certain fact that other EU countries may also require shoring up (e.g. Spain).

Few have any illusions that American taxpayers are going to, ultimately contribute a lot more than the $55 billion that has been reported.

By now, Americans should be familiar with the Obama Administration’s strategy of underestimating costs to garner support for dodgy programs.  My guess is that the EU bailout will ultimately cost American taxpayers $100 billion or more when all is said and done.

To put the $55 billion (and growing) Greek bailout in perspective, the entire NASA  FY2010 budget request to Congress was approximately $19  billion.  A space shuttle launch costs approximately $450 million per mission.  And, with the $9 billion spent so far, NASA needed approximately $80 billion over the next three years in order to have four astronauts travel to the moon and spend the week on the moon.  But, NASA has been told by the Obama Administration that travel to the moon is too expensive.

Instead, Obama will give Greece a down payment of $55 billion, and a promise for more, to support the retirement of Greek civil servants and other Greek Union workers, many of whom retired between 50 and 60 years of age, from dangerous professions such as beauty salon hairdresser.  Wow!  Obama really knows how to inspire the American people!

Of course, since the U.S. doesn’t actually have the funds, Obama’s largesse to Greece is provided at the cost of increasing the U.S. deficit and borrowing the funds, most likely, from China.  Why, oh why, does Obama keep shoveling money to those that have made the worst fiscal decisions to live beyond their means?  Does he not understand that the funds required to bailout such failures must be appropriated from other, more responsible, citizens or be robbed from programs that could actually contribute to our economic, scientific, and innovative tradition of excellence?

The cost, in terms of funding, prestige and future potential of the Obama Administration’s many failed policies pale in comparison to this recent idiocy and cement Obama’s reputation for having an inability to prioritize and put the needs of the American people first.

Supporting overpaid Greek union retirees at the expense of inspiring a new generation of Americans to study math and science is just the latest of Obama’s colossally, short-sighted failures.

The President should seek to inspire a new generation  to be setting up a permanent space colony on the moon in 2020.  We are Americans.  We have big dreams.  We do great things, like putting men, and women, on the moon.

Leaders need to lead, not docilely follow and accede to the the demands of disgruntled union workers.  Too bad for us that Obama has repeatedly shown he lacks the right stuff.

The European Union may have temporarily bandaged the sovereign-debt crisis in Greece. But we need to face the fact that Greece, Europe, and the United States all face the same problem. To varying degrees, we have build unsustainable welfare states that have called into question, once again, the sustainability of democratic government. Greece is the canary in the coal mine, not just in financial terms, but even more in political and philosophical terms.

Because of the spectacular success of American democracy over the last two centuries, we are apt to forget how discredited democracy was in 1776. The lesson of history was that, in democracies, demagogues would led the passionate and fickle masses would vote themselves the property of the rich minority, and tyranny would result.

The lessons–how Greek city-states destroyed themselves and were conquered by larger despotic empires, how Rome morphed from a republic into such a despotic empire–were well known to the authors of the Declaration of Independence and the Constitution. James Madison observed that the ancient “democracies have ever been spectacles of turbulence and contention; have ever been found incompatible with personal security or the rights of property; and have in general been as short in their lives as they have been violent in their deaths. Even more familiar was England’s experiment in “commonwealth” democracy during their seventeenth-century Civil War. “Democracy” was a bad word at the time of the American Revolution.

The state governments under the Articles of Confederation repeated many of these ancient maladies. In particular, they engaged in the kind of inflationary debtor-relief polices that demagogues always proffer in times of economic distress. The American Constitution was in large part an effort to save democratic government from the tendency of majorities to vote themselves the property of minorities. Thus James Madison in the tenth Federalist argued that the new Constitution would help prevent a “rage for paper money, for an abolition of debts, for an equal division of property, or for any other improper or wicked project,” from going nationwide.

The Constitution created a government strong enough to protect us against foreign enemies, to establish a national free-trade area, and to prevent the states from conducting their own foreign or monetary policies. Its structure was meant to prevent majority tyranny. It succeeded fabulously, making the United States the most prosperous and powerful nation in the world by the end of the twentieth century.

After a century, American intellectuals began to think that the Constitution was out of date. They imported European ideas, such as historicism and relativism, which they Americanized into “pragmatism.” They concluded that the Constitution was OK for 1787, but was unable to meet the needs of the new industrial and urban order. They looked to European political systems, especially that of Bismarck’s Prussian welfare state.

As a result, we have gone through several waves of statism–progressivism, the New Deal, the Great Society. They all amount to the same thing–demagogues telling “the people” that they will save them from “the interests.” Democratic majorities have voted themselves all kinds of benefits. Worse still, they have traduced genuine democracy by using unelected judicial and bureaucratic power to override the will of the majority when the majority doesn’t follow the statists’ agenda.

They lost the constitutional principle that government action should be limited genuinely public purposes, and began to legitimize the use of government power by private interest groups. This “interest-group liberalism” was really just the kind of faction-laden politics that Madison warned against. It has produced what Jonathan Rauch calls “demosclerosis,” “an escalating game of beggar-thy-neighbor that damages the economy and chokes the government.”

After the United States won its independence, European autocrats and aristocrats expected the American experiment to fail. The Civil War was their last, best hope, which Abraham Lincoln defeated by his rededication to the principles of the Declaration of Independence. Eventually, Europe embraced American democracy, but not American constitutionalism. Thus, they are further down the road of democratic self-destruction.

Today, if Chinese autocrats are expecting the American experiment to fail, it is because our progressives–Woodrow Wilson, Theodore Roosevelt, FDR, LBJ, Barak Obama–repudiated the principles of the Constitution, the only thing that makes democracy work.

The health care legislation recently bulldozed through Congress is only the tip of the iceberg. With some 2,400 pages of dense legalese—with thousands of additional pages of regulations implementing the legislation still to be written—this huge statute puts government in effective control of some of life’s most intimate, personal, and important decisions: who will receive medical care, and when, where, and how it will be received.

A popular slogan of the Italian Fascists under Mussolini was, “Tutto nello Stato, niente al di fuori dello Stato, nulla contro lo Stato”—meaning, “Everything for the state, nothing outside the state, nothing against the state.”

I recall this expression frequently as I observe the government’s growing reach in American society. Washington’s medical-care power grab is only the latest example.

What of any consequence remains beyond the state’s reach in the United States today? Not wages, working conditions, or labor management relations; not health care; not money, banking, or financial services; not personal privacy; not transportation or communication; not education or scientific research; not farming or food supply; not nutrition or food quality; not marriage or divorce; not child care; not provision for retirement; not recreation; not insurance of any kind; not smoking or drinking; not gambling; not political campaign funding or publicity; not real-estate development, home construction, or housing finance; not international travel, trade, or finance; not 1,000 other areas and aspects of economic and social life.

Some believe that the state still keeps its hands off religion, but even that’s not true. It certifies certain religious organizations as legitimate and condemns others, as many young men discovered to their sorrow when they attempted to claim “conscientious objector” status during the Vietnam War. It assigns members of certain religions, but not members of others, as chaplains in the armed services. It even grants clergy certain privileges not available to others.

Indeed, statism itself has become a religion for many Americans. Do they not honor the government above all else, even above the commandments of the religions they claim to embrace?

Whenever modern Americans encounter a problem, they look to government for their salvation, just as their ancestors, before the 20th century, looked to divine providence.

When the government makes a mess of things, eliciting complaints and protests, as it has for example in every area related to health care, it responds by making “reforms” that heap new laws, regulations, and government bureaus atop the existing mountain of counterproductive laws, regulations, and government bureaus. Thus, each new “reform” makes the government larger and more destructive than before.

The areas of life that remain outside the government’s participation, regulation, surveillance, or manipulation by means of taxes and subsidies have become so few and so trivial they scarcely merit mention.

We verge ever closer on the condition in which everything that is not prohibited is required. Yet like the average German, most Americans will declare loudly that they are free and that the United States is a free country.

As the state seeks to control virtually everything and crushes all real opposition, Americans now inhabit a country that would be completely unrecognizable to its founders. Indeed, it bears only faint resemblance to the country it was just 50 years ago.

More and more, “Land of the Free” is becoming nothing but an empty, pathetic boast.

Two weeks ago, I wrote on BigGovernment that the GOP Today is much different than the party was a few years back.  I was glad that my post generated attention, and very pleased to read through the different responses – both positive and skeptical.    Today I write again for two reasons.  First, to announce an exciting new project devised by the House Republican Economic Working Group.  Second, to take another step in earning your trust by showing you that we understand that actions speak louder than words.

We all know that Washington has a spending problem – and both Democrats AND Republicans bear some responsibility.  But as I wrote last week, America is at a crossroads and the choices we make at this critical time will determine what kind of country we want to be.  To get back on the right path, Congress MUST start to make some choices that simply can’t be delayed any longer.

While we won’t be able to solve our deficit problems overnight or with one silver bullet, we CAN and we MUST begin to replace the culture of spending that now dominates Washington with a culture of savings.  Just imagine if your government was as focused on saving money as it is on spending money.  Imagine if Congress spent less time naming post offices – 62 and counting – and more time reducing wasteful spending.  Sounds nice, doesn’t it?

Today, we are launching YouCut – a first-of-its-kind project designed to defeat the permissive culture of runaway spending in Congress.  It allows YOU to vote, both online and on your cell phone, on spending cuts that you want to see the House – YOUR HOUSE – enact.   That’s right, instead of Washington telling YOU how THEY will spend YOUR money, YOU can tell THEM how to save it.  After several days of voting, on Monday, May 17^th, we will announce the first winner and later that week House Republicans will call for an up-or-down vote on the spending cut.  We will repeat this cycle every week for the rest of the year.

For the first week of voting, here are your choices:

1. Eliminate the Presidential Election Fund, a federal program that provides matching funds to political candidates during Presidential primaries, certain third-party candidates, and funds for political conventions. In the 2008 Presidential election the candidates raised over $1.3 billion from individuals and PACs; do they really need to supplement that with taxpayer money?
2. Prohibiting taxpayer-subsidized union activities by prohibiting federal employees from being paid by the government for performing union functions.  Currently some federal employees spend up to 100% of their workweek, paid by taxpayers, doing work for their union. Federal employees unions collect millions in revenue each year and spend significant amounts on political activities and lobbying; should they also be subsidized by the taxpayer for their official functions?
3. Terminate the Department of Housing and Urban Development program that provides individuals with $25,000 stipends for completing their doctoral dissertations. Recently taxpayers have financed research on media strategies for housing policy and the use of eminent domain for urban redevelopment. Why should families who are struggling to pay for their children’s college also be asked to fund stipends from the government for those who want to write their dissertation on certain government-preferred policies?
4. Terminate the new alternative welfare program, recently created to incentivize states to increase their welfare caseloads without requiring able-bodied adults to work, get job training, or otherwise prepare to move off of taxpayer assistance. Reforming the welfare program was one of the great achievements of the Republican Congress in the mid 1990s, saving taxpayers billions of dollars and ending the cycle of dependency on welfare.  This new program ushered in by Democrats is merely a backdoor way to undo those reforms.
5. Focus federal economic development assistance on areas of need. The Community Development Block Grant program currently funds a wide range of local economic development activities. While it is advertised as a way to help low-income communities, funds are also dispersed to communities with income well-above the national average. A recent study found that the community of Newton, Massachusetts, with a per capita income over twice the national average, was receiving $28 per person in CDBG funds. At the same time, other communities with income 25% below the national average were receiving $10 per person.

There they are: five simple ways to begin to talk about saving money.

You have a right to a federal government that doesn’t spend money that it does not have.  Anyone who believes that President Obama, Senator Reid, Speaker Pelosi or the Democratic majorities are “concerned” about the deficit should take a look at how grossly they’ve increased spending.  Make no mistake, they look at America’s massive debt and see a reason to raise taxes.  But they are wrong.  Our debt was born out of an addiction to spending.   And if those same Democrats aren’t going to do anything to stop this addiction, we are.  If those Democrats aren’t going to listen to you, we are.

As I wrote a few weeks back, a 178-seat minority isn’t going to win many legislative battles in the House. And we don’t have a lot of tools at our disposal.  But I commit to you that we ARE going to use every means we have to hold them accountable.  And this project is a start.

The time has come for Congress to finally show political courage. American families have been forced to face tough financial realities and make difficult but necessary decisions. Why should their government act any differently?  This is not the same GOP as it was a few years ago, and with YouCut, we hope to force the Democrat-controlled Congress to begin to confront the difficult but unavoidable realities of our fiscal situation.

Please drop by http://www.republicanwhip.house.gov/YouCut and vote to help us put Uncle Sam on a diet.

On Tuesday, May 4, 2010, the Director of the U.S. Census Bureau sent a welcome memo addressed to the part-time workers his agency had allegedly hired to complete the 2010 Census.  He referred the memo to his “600,000 new colleagues,” whom he called “the heart of the operations for the second half of the census” and “the face of the US Federal government.”

On Friday, May 7, the U.S. Department of Labor released its latest official monthly jobs report, which noted that “Federal government employment was up in April, reflecting the hiring of 66,000 temporary workers for the decennial census.”  This followed prior DOL reports of Census hiring in March(48,000), February(15,000), and January(9,000). Even if all those “temporary” Census workers hired as early as January were still on the job on May 4 when the Director sent his“welcome” note, the official data through April suggests the Census Bureau has hired 138,000 temporary workers this year, not 600,000.

Where are the other 462,000?

Were they hired on Saturday, May 1, Sunday, May 2, and Monday, May 3?  If so, does that reflect the biggest surge in hiring for a 3-day period in world history, mostly falling on a weekend, no less? We’ll have to wait for the May jobs report, released on June 4, to know for sure.

Big Brother says elderly visitors to federally funded meals at a Georgia senior citizen’s center aren’t allowed to pray to that Christian God of theirs. Obama’s Big Brother government contends that since it has paid for their meals the government has the right to slam its iron boot heel down on the necks of those seasoned citizens that dare to engage in such an apostasy toward the state.

Seem absurd? Well it is but that is what happens when the feds roll into town and begin to hand out money. They feel the right to dictate what everyone is allowed or not allowed to do and in the case of Port Wentworth’s Ed Young Senior Citizens Center near Savannah that is to tell these old folks that they are not allowed to pray before a meal.

There are federal “guidelines” to observe, after all and the federal government’s rules say none of that ridiculous Christian stuff will go on if the feds supply even a penny of funding. Old folks that want to pray are banned from doing so and if they don’t like it, why they can go hungry because the new Uncle Sam is a crusader against religion.

Well, at least one religion, anyway.

You see, while Obama’s federal government is ever ready to get tough with Georgia’s elderly and to put a stop to all that praying nonsense, it is also the same government that at federal expense is installing ritual footbaths in airports and universities to mollify Muslims. Not only that but the same federal government sees no reason to stop bombers from easily boarding planes so that they can make an escape to a foreign nation after a failed attempt to kill untold hundreds of Americans. But damn the torpedoes and full speed ahead to prevent those dangerous old folks in the middle of Georgia from daring to pray to that subversive Christian God!

The nerve of those elderly Americans daring to observe their Christian cultural heritage, a heritage that helped build this country. It’s an outrage, don’t you think? So, it’s freedom from religion as far as Obama’s government is concerned. I mean these old folks are probably as dangerous to the state as can be! Thank Gaia that Obama is quashing their subversive activities.

Praise be it to the state, thanks be to The One, and pass the potatoes. The Obammessiah shall provide all our wants. But, remind me… has he walked on water yet?

I frequently argue that government spending is the problem, not budget deficits. Regardless of whether it is financed by taxing or borrowing, every penny of spending diverts resources from the productive sector of the economy. I narrated a video explaining why excessive spending is bad from a theoretical perspective. I did another looking at the empirical evidence for smaller government. And I had another video discussing why deficits are a symptom and the real problem is bloated budgets.

Nonetheless, some people seem convinced that deficits and debt are the real problem. While I think that focus is a bit misguided, I certainly agree that there is something utterly immoral about spending today and imposing a fiscal burden on future taxpayers (especially since so much government spending is for current consumption and transfers).

But here’s some really depressing news for the anti-debt crowd. Today’s deficits and debt actually are just the tip of the iceberg. Here’s a new video from the Center for Freedom and Prosperity that reveals the enormous unfunded liabilities resulting from entitlement programs. As the video explains, unfunded liabilities are promises by politicians that impose enormous long-term obligations for more spending and debt.

The narrator of the video is Kelly McDonough, a student at American University and a former Cato Institute intern. If this video is anywhere near as successful as the other video narrated by a former Cato intern, perhaps this will become a new tradition. That won’t be good for my video career, but I imagine there won’t be many people lining up to complain.

Here are some very depressing stories showing that bloated welfare states funnel money to some rather disreputable characters – even when governments uncharacteristically try to do the right thing.

The Daily Mail reports that a European Court has ruled that the U.K. no longer can impose restrictions on welfare payments to women married to suspected terrorists:

A European court has instructed Britain to drop restrictions which limit social security benefits paid to the wives of terror suspects. Ministers imposed tight rules on payouts to stop the money falling into the hands of alleged Al Qaeda fanatics. Under the restrictions, cash payments were strictly limited and families had to show receipts to justify every penny of spending. But yesterday the European Court of Justice said there was no danger of the handouts being used to fund terror and branded the measures unlawful.

Unfortunately, this story is not an isolated incident. Here’s a report from the Express about a Muslim cleric who collected welfare from the Brits while (to put it mildly) being a reprehensible slug: “The twisted cleric provoked outrage by comparing British troops to Nazi stormtroopers and telling parents of dead soldiers that their children had died in vain. …Choudary, a former lawyer…rakes in more than £25,000 a year in welfare handouts.”  And CNN reports that, “Since the mid-90s, London has been a haven for foreign jihadi preachers, organizers, agitators and propagandists, many of them recipients of generous welfare benefits.

And here’s a BBC report noting that: “In November 2000, Mr Kaplan was convicted for incitement to murder and sentenced to four years in jail. Since then, intelligence reports say his followers have become even more devoted to Mr Kaplan, considering him a martyr for the cause of Allah. …Mr Kaplan is believed to have a fortune worth millions. Nonetheless, he claimed social benefits in Cologne for many years until 2m Deutschmarks (1m euros, £700,000) in cash was found in his flat. This Mickey Kaus blog post has more nauseating details.

The most amazing story comes from Australia. Here’s a Youtube copy of a report showing that Aussie taxpayers gave $1 million of welfare over 19 years to an Islamic extremist who planned to kill thousands of innocent people.

Here are some very depressing stories showing that bloated welfare states funnel money to some rather disreputable characters – even when governments uncharacteristically try to do the right thing.

The Daily Mail reports that a European Court has ruled that the U.K. no longer can impose restrictions on welfare payments to women married to suspected terrorists:

A European court has instructed Britain to drop restrictions which limit social security benefits paid to the wives of terror suspects. Ministers imposed tight rules on payouts to stop the money falling into the hands of alleged Al Qaeda fanatics. Under the restrictions, cash payments were strictly limited and families had to show receipts to justify every penny of spending. But yesterday the European Court of Justice said there was no danger of the handouts being used to fund terror and branded the measures unlawful.

Unfortunately, this story is not an isolated incident. Here’s a report from the Express about a Muslim cleric who collected welfare from the Brits while (to put it mildly) being a reprehensible slug: “The twisted cleric provoked outrage by comparing British troops to Nazi stormtroopers and telling parents of dead soldiers that their children had died in vain. …Choudary, a former lawyer…rakes in more than £25,000 a year in welfare handouts.”  And CNN reports that, “Since the mid-90s, London has been a haven for foreign jihadi preachers, organizers, agitators and propagandists, many of them recipients of generous welfare benefits.

And here’s a BBC report noting that: “In November 2000, Mr Kaplan was convicted for incitement to murder and sentenced to four years in jail. Since then, intelligence reports say his followers have become even more devoted to Mr Kaplan, considering him a martyr for the cause of Allah. …Mr Kaplan is believed to have a fortune worth millions. Nonetheless, he claimed social benefits in Cologne for many years until 2m Deutschmarks (1m euros, £700,000) in cash was found in his flat. This Mickey Kaus blog post has more nauseating details.

The most amazing story comes from Australia. Here’s a Youtube copy of a report showing that Aussie taxpayers gave $1 million of welfare over 19 years to an Islamic extremist who planned to kill thousands of innocent people.

Click To Play

Mark Steyn joins us late and Peter Robinson leaves early in this guest packed episode. Author Drew Klavan joins us for a fascinating discussion of being a conservative and working Hollywood and pop culture in general. Then John Dennis the Republican trying to unseat Nancy Pelosi, followed by Dr. George Savage who discusses some of the amazing technology advances he is helping to bring to the market. Finally, John Yoo gives us his expert insight into the machinations involved in catching and charging the Time Square bomber. Questions? Comments? Write us at podcast@ricochet.com or come join the discussion on our Facebook page.

Panic has gripped stock markets worldwide over the Greek debt crisis and the threat of a debt-deflation contagion through banks in Europe (primarily) and the U.S. that own the bonds of Greece, Portugal, Spain, and so forth. If these bond asset prices collapse totally, lending facilities would be badly crimped for both the short and long term. And that, in turn, would damage prospects for economic recovery.

The Dow closed yesterday off nearly 350 points. Earlier in the day the Dow was down 850 points, though there is talk of computer glitches and technical problems that may have temporarily undermined trading. Either way, the market is getting creamed as a result of the Greek story.

The real winner? Gold. It’s up about $25, to $1,200. People want real money. They do not trust the debt-laden currencies of Europe and the United States. Or for that matter Japan. Gold is fast becoming, once again, a reserve currency of choice.

Meanwhile, the EU/IMF bailout package for Greece, which does include draconian budget cuts, contains a 2 percentage point increase in the VAT tax that is anti-growth. Steve Forbes correctly said Wednesday on CNBC that the Greeks should be slashing spending and should move to a flat tax, just like the countries in Eastern Europe. I gave him a Nobel Prize for that.

Market chatter, at least in Europe, is suggesting that the $150 billion bailout is not enough. But it may be that the left-wing union mobs in Athens have caused a major backlash throughout Europe and elsewhere. Despite the mob, the Greek parliament was able to pass legislative approval of the bailout package. This caused a small stock rally for a brief time this morning.

The German parliament will vote today on this package. Should it be voted down, all hell will break loose again in world stock and credit markets.

And then there’s Britain. The Tories seem to have eked out a win in a close election last night and dethroned Labour. But, David Cameron and Co. will be a minority government.

I still believe that one of today’s key themes is a global revulsion toward the massive spending and debt programs put in place by the U.S., Euroland, the G20, and the IMF back in late 2008 and 2009. Unwinding these Keynesian mistakes is not an easy thing to do. But financial markets are now exerting discipline on this out-of-control spending and borrowing.

Financial markets don’t like these big-government policies at all. Neither do voters. The markets don’t trust the ability of these nations to service the interest payments on all this new debt. And voters are much opposed to the tax-hike implications of the debt.

In particular, the U.S. and the Western countries in Europe have lurched left in recent years. It’s bad for growth, it’s bad for credit quality, it’s bad for banks, and it smacks of credit-deflation bankruptcy. In short, it’s a bloody mess.

Yesterday, the Washington Post reported that the Tea Party movement is “struggling to overcome accusations of racism,” some of which has been perpetuated in its editorial pages. Yesterday’s New York Times, home to the most obsessively anti-Tea Party editorial page in America, was stunned to discover that “at least 32 African-Americans are running for Congress this year as Republicans, the biggest surge since Reconstruction, according to party officials.”

Previously, The Times reported that Tea Partiers are, on average, people with a high levels of education and higher than average incomes. So it would seem that they aren’t, as some editorialists and pundits contend, simply a gang of subliterate militia men or, as actress Janeane Garofalo recently told MSNBC’s Keith Olbermann, a subsection of the white power movement.

Wandering the recent Tax Day tea party in Washington DC with Reason.tv’s Meredith Bragg, we saw some stupid signs–though none that could be considered offensive or racist. We talked to some people that claimed President Obama was both a Czarist and Bolshevik. We spoke to a former star of Saturday Night Live who has previously claimed that president might, in fact, be the anti-Christ. Or a communist. Or both. There were those who fretted that the United States were morphing into a Stalinist state. And there were countless protesters concerned that the Obama administration was spending recklessly, interested in auditing the Federal Reserve, and seething about the General Motors bailout.

So did we find that the Tea Party was motivated by race, by the fact that we now have a black president? Did it seem as if their stated concerns about health care reform and a ballooning national debt simply a smokescreen, designed to concealing a racist agenda? Here is what we found.

Produced by Michael C. Moynihan and Meredith Bragg. Edited by Meredith Bragg. Approximately 2 mins.

The National Education Association, the nation’s largest teachers union, and its counterpart, the American Federation of Teachers, are ramping up attention on Senate Bill 3206, introduced by Sen. Tom Harkin (D-Iowa), which would create a $23 billion “education jobs fund” to hire or retain “150,000 or more” school employees for the next school year.  The NEA is engaged in a “massive, 24/7 lobbying campaign” to pass Harkin’s bill, according to its president Dennis Van Roekel.

That’s $153,333 spent per job just to “retain” them.  The most recent data from the American Federation of Teachers concluded the average teacher salary is $51,009.  Where is the other $100,000 per job going?

Nevertheless, in a recent Senate committee hearing, Harkin cited the “emergency” for creating the fund.  Note he didn’t say teachers, he said “education jobs.”  That’s because in many states, like Michigan, teachers unions are losing members that are custodians or food service workers.

Just for the record, billions of dollars have already been spent on “retaining” school jobs.  The NEA claims 325,000 public school jobs were “saved” under the stimulus bill.

The NEA released a YouTube video with a title which pretty much sums up the union’s entire existence: “The issue is JOBS.”

Of course: the issue is not accountability or test scores or huge amounts of fiscal waste.  It’s simply jobs and therefore union dues.

What would Sen. Harkin’s bill mean for the NEA and AFT in terms of revenue?  Let’s do the math.  The NEA has about three-quarters of unionized school employees within its fold.  Its 2010 dues are $162 per full-time member, according to the Indiana State Teachers Association, an NEA affiliate.  AFT’s annual dues are $184.20, according to union financial documents found at AFTexposed.com.

Using the membership ratio breakdown, it is estimated an “education jobs” bill would result in a savings of $18.2 million for the NEA and $6.9 million for the AFT.

Surely this never dawned on the two unions when they decided to push for this bill.

There is a direct correlation between the loss of public school jobs – whether warranted due to declining enrollment or because of a money shortage – and the teachers unions’ income.  If the NEA and AFT can pass an “education jobs” bill, it will also equate to a huge windfall for Big Labor.

Just what the unions put this Congress in to do, right?

Many fine Republicans argue we should privatize Social Security.  Just like George Bush – they are right.  They are noble.  They are dust.  The last time we mentioned it, we found our ass booted around our neck.  An obscene daisy. Ripe for the picking.  Smelling like death.

Not me.  I prefer to get in the mud, fight the weakest midget in the bar, and End Him.  I will fight dirty.  Because “defense of liberty demands extreme vice.” Or something.

Either way, we can always use a trick shot for 2010, and our trickiest shot is GOV2.0.

GOV2.0 loves the GOP.

If we were a boy band, GOV2.0 would throw her panties on stage.   And if we sing her a power ballad and hold all the right notes… GOV2.0 will certainly bring her hot friend, “Private $$ Accounts”, back to our room  for a threesome.

So pull on your spandex, Mike, and let’s go yodel in the valley.

The Social Security Administration has 64,000 employees, spread out over 1,600 local offices.   In 2009, it handled 42MILLION in office visits, and fielded 57MILLION calls.  Each customer makes one call and one office visit per year.

Yawn! The average McDonalds deals with 15X the number of customers an SSA office deals with daily… and they are open on holidays with a smile.

It’s a banking operation.  51MILLION recipients have $56BILLION distributed to them monthly.  But by 2034, we’re adding 35M more elderly to the rolls.

As you can imagine, AFGE is licking its diseased lips at the thought of hiring more obese Democrat donors.

GOV2.0 hates unions.  They give her the skeevies.

One fatted calf we can easily slaughter are Social Security teleservice jobs that pay more than 5x (including benefits) what other US call centers pay.  We don’t need grandma calling Bangalore when her direct deposit doesn’t hit, but keeping the jobs here in the states doesn’t mean we can’t save big money modernizing the calling system.

Be sure… we can do it for peanuts, and create healthy part time jobs for stay-at-home moms in their jammies.

The kind of company we’d contract with is Live Ops.  All their representatives work from home.  They get paid per call.  The average operator handles eight calls per hour for $1.57 per call.  80% are college educated.  They are criminal and credit checked.   And they are incentivized to kick ass because customers are surveyed after the call, and the best operators get more calls.

Or if you are a worthless sponge GS-7 in Alabama, we’ll pay you $54K a year PLUS:

Robust health benefit options, Federal retirement plan, 401K-style Thrift Saving Program, life insurance, and flexible spending accounts for medical and dependent expenses.

And let’s not forget the two mandated coffee breaks and lunch the union negotiated during GOV1.0.  And these unionized call centers STILL provide the wrong information 25% of the time.  And 58% of callers get a busy signal.

F that, man.  Here are the lyrics to the GOP smash hit, “Fire Witold Skwierczynski, Union Boss, Grandma Killer.”

1. ALL Social Security payments will be direct deposit or debit card based, like food stamps, by 2012.  19% are still getting checks, and they are 20x more likely to to call in.
2. 50% of local Social Security offices will be closed by 2012.  More to follow.
3. All seniors will have online accounts at a new SSA.GOV where they will be able to handle their accounts, schedule call-backs so they are no longer waiting on hold, chat with online operators, etc.
4. In office visits with a Social Security employee will be by appointment only, when the operator cannot handle the issue (almost never).
5. No new hires at SSA for calling centers.
6. New call volume will now be routed to private companies (like Live Ops).  A service provider API will be published so multiple US companies can plug in and compete on a per-call basis.  Best operators win.
7. Customer service will be provided by phone 24 hours per day, 7 days a week. Wait times under a minute, or we call you back.
   
8. Hires will be both part and full time contractors, work from home on their own schedules, and will sign Privacy Agreements. Violating them will be a felony.
9. After two years, we’ll audit the program and begin phasing out the GOV1.0 telemarketing centers.
10. Each state will operate one SSA office with a strong preference to well dispersed work-from-home “road warriors”, who will provide in-home service by appointment to the mere  tens of thousands of recipients who have obscure cases.  They will earn their pay.

This stuff isn’t complicated.  Virtual call centers attached to web-based customer service systems are out-of-the-box technology that run on regular servers.  That’s why we must outsource.  If the government does it, we’ll end up with a $10BILLION unionized web site that takes coffee breaks.

Math check: let’s double the current call volume (100M) and double the cost per call ($3.00)…  $300MILLION. With an M.  When was the last time anything in government was priced in the millions?

More proof we do god’s work: 41% of SSA workers will retire by 2018.

The only real political downside is requiring the old to learn the new.  Customers will first go online; second, go the phone; and only when the vastly improved GOV2.0 system cannot handle their very obscure and specialized problem, will they meet a public employee in person.

SSA needs to live by this mantra: keep it cheap, keep it “pretty good,” and make sure the money hits the account.

*To make my life easy, I’m grouping Disabled /Disability numbers into my napkin math.  Adjudication on these cases is harder, but GOV2.0 has solutions here, too.  We can be fair and fast.  Selah.

From the Associated Press:

Deadly riots over harsh new austerity measures engulfed the streets of Athens on Wednesday, killing three bank workers as angry protesters tried to storm parliament, hurled Molotov cocktails at police and torched buildings.

Tens of thousands of people took to the streets as part of nationwide strikes to protest new taxes and government spending cuts demanded by the International Monetary Fund and other European nations before heavily indebted Greece gets a euro110 billion ($141 billion) bailout package of loans to keep it from defaulting.

The three bank workers—a man and two women—died after demonstrators set their bank on fire along the main demonstration route in central Athens. As their colleagues sobbed in the street, five other bank workers were rescued from the balcony of the burning building.

“A demonstration is one thing and murder is quite another!” Prime Minister George Papandreou thundered in Parliament during a session to discuss the spending cuts he announced Sunday—measures even the IMF has called draconian. Lawmakers held a minute of silence for the dead—the first deaths during a protest in Greece since 1991.

“We are all concerned by Greece’s economic and budgetary situation but at this time our thoughts are with the human victims in Athens,” European Union President Herman Van Rompuy said in Brussels.

German Chancellor Angela Merkel called the bailout critical for all of Europe.

“Nothing less than the future of Europe, and with that the future of Germany in Europe, is at stake,” Merkel told lawmakers in Berlin, urging them to quickly pass the country’s share of the bailout—euro22 billion ($28 billion) over three years—by Friday. “We are at a fork in the road.”

Continue reading here. The United States is also approaching a similar fork in the road. In Greece, half of all workers are government employees. We aren’t anywhere close to this, but, increasingly, public sector unions at the local, state and federal levels are dictating government policy. They are fueling a spending binge that will eclipse this current crisis in Greece.

The ink was barely dry on the $150 billion EU/IMF bailout of Greece when world stock markets tanked on two major fears. First, financial analysts are concerned that the bailout money won’t be enough to cover Greece’s borrowing needs from its out-of-control budget deficit. Second, there are fears that the EU/IMF deal will not be approved by the German parliament in a vote scheduled for Friday.

Additionally, there are new worries that the Greek debt contagion will spread to Spain and elsewhere in Europe. The looming specter of debt default and deflation is heavy in the air for investors worldwide.

Making market matters even riskier, German chancellor Angela Merkel faces key regional elections this Sunday in populous North Rhine-Westphalia, including the conservative areas of Cologne, Bonn, and Stuttgart. These cities hate government debt and overspending as much as the rest of Germany, if not more so.

The great postwar German leader Konrad Adenauer came from Cologne. He was a conservative Catholic who despised Nazism and Soviet communism. He also was an inflation fighter. To stop hyperinflation in the postwar period, Adenauer sponsored the new German mark and linked it to the dollar, which in those days was as good as gold.

Today, all of Germany still hates inflation.

And the Germans are afraid that the currency printing presses used to buy bad bailout bonds will return the country to a haunted past. So it’s tricky business for Merkel to sell the Greek bailout on the eve of local elections that could disrupt her already thin governing coalition.

Merkel is playing a double game here. She’s telling the Financial Times and the Wall Street Journal that the bailout must pass in order to save the euro currency. At the same time, she’s telling folks at home that Greece’s extravagant social-welfare entitlement system of bankrupt promises is a disgrace that Germans would never tolerate.

Apparently, credit markets won’t stand for it either. Both around the world and here in the U.S., credit markets are boycotting massive government debt creation. The result is that gold is fast becoming a currency substitute, with strong markets for the yellow metal saying a pox on all your houses.

Merkel and other European leaders would like the IMF to be the fiscal-discipline policeman for Greece and the rest of southern Europe. But as Nobelist Robert Mundell has argued, while the unified and fixed exchange rate of the euro currency system, along with liberalized trade, has been good for economic growth, things have broken down with the failure of the so-called fiscal-stability pact that was never enforced.

With tens of thousands of Greek government union workers marching in the streets of Athens calling for more general strikes in protest of IMF austerity measures to cut back on bloated pensions, voters in Germany and perhaps other EU countries do not believe the bailout conditionality will ever work. Voters see solvent nations being saddled with more debt that the European Central Bank may well monetize into higher inflation.

Perhaps the Greeks should consider a privatization asset sale of the Parthenon, or some of the beautiful Greek islands, as a means of raising desperately needed cash. Think of it: Greek Thatcherization. Of course, in addition to privatization, Margaret Thatcher used her budget ax. That’s something neither Greece nor Spain appears capable of implementing in a sustained way. Mrs. Thatcher also reminded us that the problem with socialist governments is that they finally run out of other people’s cash.

What’s more, while Greece and Spain have moderate 30 percent business tax rates, lower than rates in the U.S., their combined personal and VAT tax rates come to about 60 percent. Team Obama take note: These are anti-growth tax policies.

Indeed, the debt follies of Europe and the bankruptcy of the European entitlement state should be a lesson for Obama’s Washington, where overspending and borrowing have reached absurdly grand heights. As a share of GDP, U.S. debt is projected to move toward 100 percent in the wake of the new Obamacare entitlements. That’s near the 125 percent debt ratio of Greece.

And just like Greece, U.S. government union-worker benefits, which run 50 percent above private-sector equivalents, are bankrupting federal, state, and local budgets. They’re also spawning a massive voter revolt against big-government debt that will bear fruit this November in the tea-party midterm elections.

In a vague sort of way, British Tory leader David Cameron is opposing the spend-and-borrow mess of Gordon Brown’s Labour party that so resembles Obama’s policies. Consequently, Cameron looks set to win the U.K. election on Thursday. That’s good news for England. But it could embolden German legislators to vote against the EU-IMF bailout for Greece on Friday. And that could create an even bigger stock market mess, at least in the short run.

Call it a spend-and-borrow debt mess. A pox on all your houses, at least until financial-market and voter discipline force the dim-witted politicians to radically change course.

April was a busy month for bad:   lame financial reform legislation, served up three days in a row like rancid leftovers, SEC fraud filings, Wall Street Hearings in Congress, Greek bailouts, oil spills in the Gulf of Mexico and car bombs in Times Square.  With so much occurring, on so many fronts, little attention has been paid to President Obama’s often inflammatory commencement speech at the University of Michigan.

Let’s consider a few of President’s Obama’s pearls of wisdom that he shared with Michigan graduates.

“All you hear in Washington is the clamor of politics – a noise that can drown out the voices of the people who sent you there.” This, of course, is precious, coming as it does from  the leader of the Democratic party, which had to twist arms and bribe legislators to vote for a flawed healthcare bill because members of congress–who were listening to the “voices of the people”–were afraid to vote for a bloated bill that did little to address the most pressing problems in healthcare, a bill which their constituents loudly and repeatedly told congress they didn’t want.

“We’ve got politicians calling each other all sorts of unflattering names.” which may be why in 400 speeches and Q&A sessions, delivered in his first year in office, Obama finds occasion to demonize or blame President George W. Bush, and why Obama, 16 months  into his presidency, continues to use Bush as the whipping boy for bad left wing policies.

“The media tends to play up every hint of conflict, because it makes for a sexier story – which means anyone interested in getting coverage feels compelled to make the most outrageous comments.” This may explain Obama’s unexpected attack, during the Henry Louis Gates fiasco, in which Obama admitted he did not know the details, but  proceeded to attack the Cambridge police department saying that “Cambridge police acted stupidly”, when responding to a 911 call about a alleged break-in at a residence in Cambridge.

“Politics has never been for the thin-skinned” which doesn’t explain why President Obama is so sensitive to criticism.  remember when Major Garrett, of Fox News, asked the question that most of America wanted to the answer to:  “What took you so long to be concerned about Iraq?”  And, Obama seemed quite irritated?

“American democracy has thrived because we have recognized the need for a government that, while limited, can still help us adapt to a changing world.” Then why has Obama ignored the concept of a “limited” government and, instead, presided over the greatest expansion in the federal government’s size and intrusiveness in the lives of Americans in the past 70 years?

“We have held fast to the belief that government doesn’t have all the answers, and we have cherished and fiercely defended our individual freedom.” Then how does he explain the federal government intruding into an every wider range of our personal decisions with wild abandon? Under President Obama, government now wants to direct our use of salt, the purchase of fizzy drinks, legislate how many light bulbs we can use in hot tubs and even provide advice on whether dogs should be given bones?

“We, the people, hold in our hands the power to choose our leaders, change our laws, and shape our own destiny.” Of course, that doesn’t include White House interference in open senate seat appointments or rushing through a healthcare reform bill that less than 1% of Congress had read, and which few Americans had been allowed to view because, as Nancy Pelosi said: “you have to pass the bill if we want to find out what’s in it“,  Nor does it explain White House antipathy to the Tea Party movement which is comprised of Americans who want the opportunity to shape their own destiny.

“We know that too much government can stifle competition, deprive us of choice, and burden us with debt.” Of course Obama knows this–he’s the one who’s doing it.

“In an era of iPods and Tivo, where we have more choices than ever before, government shouldn’t try to dictate your lives.” President Obama seems to be dictating all sorts of outcomes to protect his loyal supporters.   Companies bidding on government contracts, for example,  are now required to first seek approval, support and participation of unions.  Many of President Obama’s policies have delivered is resentment, class warfare, dishonest promises, and further dependency on government.

“Our government shouldn’t try to guarantee results”. Then, why has the government interfered with free markets, funding bailout after bailout? Why has the White House advanced legislation that refuses to allow foreclosures on delinquent mortgages? Why have Unions and other favorites been promised additional benefits and expanded roles in our economy at the cost of the free market?

“We cannot expect to solve our problems if all we do is tear each other down.” Perhaps President Obama could follow his own advice and not blame President Bush for Obama Administration spending sprees, not blame Rush Limbaugh for the Obama Administration’s policy mis-steps and flawed decision making, not criticize Fox News for reporting what they hear and see, not cry “racism” every time opponents have an honest policy disagreement.

“This kind of vilification and over-the-top rhetoric closes the door to the possibility of compromise.” This one is rich.   No President has ever so blindly fallowed the Saul Alinksy tactic (identify, isolate, and vilify) strategy to achieve his political goals.  Obama seems to have  found no shortage of villains to isolate and demonize when the time was right: Healthcare executives, Wall Street, Bankers, Cambridge Policemen, have all served the President well as political piñatas.

“Part of what civility requires is that we recall the simple lesson most of us learned from our parents: treat others as you would like to be treated, with courtesy and respect.” And yet Mr. Obama continues to treat all Americans as if they were mathematically impaired and unable to add up the growing number of promises that will add even more pressure on an already escalating mountain of debt.  Telling children that they can have it all, that they can and should have all the goodies they want, paid for by someone else, is not good parenting.

“If we choose only to expose ourselves to opinions and viewpoints that are in line with our own, studies suggest that we will become more polarized and set in our ways.” So why does President Obama allow the Democratic leadership in Congress to draft legislation behind closed door, excluding Republicans?

“When we don’t pay close attention to the decisions made by our leaders; when we fail to educate ourselves about the major issues of the day; when we choose not to make our voices and opinions heard, that’s when democracy breaks down.” Case in point.

Much like the Fonz, who first jumped the shark in Happy Days, with this commencement speech at the University of Michigan, President Obama may have jumped the shark with his teleprompted rhetoric, and reached the point where whatever he says from this point forward has no, absolutely no, credibility because the dichotomy between his words and his actions is so very extreme, and Obama seems oblivious to these differences.

President Obama continues to believe he can fool all of the people all of the time.   By preaching to the choir, President Obama may be able to continue to delude himself just a bit longer.

General Motors CEO Ed Whitacre has bragged in TV commercials and newspaper columns that GM has paid back its bailout “in full and ahead of schedule.”

As with the Pontiac Aztek, an ugly exterior masks an ever darker problem: Whitacre is being fanciful to the point of deceit. GM received $50 billion in TARP funds (never mind that TARP was only supposed to cover financial institutions). About $7 billion of that came in the form of a straight-up, low-interest loan. And about $13 billion came in the form of an escrow account.

So how has GM, which lost $38 billion in 2007 even as it sold 9.4 million cars, paid back its debt? It took money from the escrow account to pay back the $6.7 billion loan.

Do you remember when you were a kid and your parents gave you $20 to buy them a Christmas present? You bought them something worth $3 and pocketed the rest? That’s what GM has just done.

Oh, and do you remember when you hit your parents up for college? GM has applied for a $10 billion, low-interest loan from the government to modernize its plants so its cars will meet new federal mileage standards.

If you think all this constitutes paying back their debt in full and ahead of schedule, you might want to check out the new line of GM cars. And hope that the company’s safety engineers are better at math than their CEO.

Approximately 1.35 minutes. Written and produced by Dan Hayes, Meredith Bragg, and Nick Gillespie.

The Hill reports that during a visit to a Macon, Missouri ethanol plant this week, President Obama said that he wants to triple ethanol production over the next twelve years:

President Barack Obama on Wednesday touted ethanol – both the current variety and next-wave fuels – as a key part of his energy strategy and a way to revive rural economies.

Obama endorsed expanded ethanol production during a speech at a Macon, Missouri plant owned by POET, the country’s largest ethanol producer.

“I believe in the potential of what you are doing right here to contribute to our clean energy future but also to our economy,” Obama said at the plant that produces 46 million gallons per year.

Obama noted funding for ethanol projects and research in last year’s stimulus law, and also cited his interagency biofuels working group. The administration wants to see ethanol production tripled over the next 12 years, he said.

The comments come as the Environmental Protection Agency (EPA) is considering raising the fuel blend ceiling from 10 to 15 percent, a move heavily lobbied for by the ethanol industry as a way of forcing increased reliance on its product.

Key administration officials, as well as Members of Congress, are also reportedly pursuing legislation that would mandate increased flex fuel vehicle production by the auto industry.  Flex fuel vehicles are capable of running on fuel that is up to 85 percent ethanol, and are heavily produced by government-controlled General Motors.

Fiscal conservative, environmental and social justice groups remain staunchly opposed to increased production of ethanol, given the raft of expensive subsidies from which the industry benefits and without which many observers say it would perish, and given it’s negative environmental effects and alleged impact on third world food prices and connection to hunger and malnutrition.

Last year, the ethanol industry spent $1.5 million on lobbying aimed at boosting federal support for the fuel in the face of such opposition.  Judging by Obama’s comments this, it may have worked.

President Obama has appointed three new doves to the Federal Reserve Board, thereby taking command of the nation’s central bank. But there’s a split developing inside the Federal Reserve System: The Reserve Bank presidents, appointed by their own district boards of directors, are increasingly likely to wage a battle royale against the central-bank headquarters in Washington and its free-money, ultra-easy policies.

The new Obama appointees include Janet Yellen, president of the San Francisco Fed, Peter Diamond of MIT, and Sarah Bloom Raskin, the top Maryland state banking supervisor who blames Wall Street greed for much of the financial crisis.

Now, Ms. Yellen is a highly credentialed and respected former Clinton economist. But the new Fed vice chair is also a devotee of targeting the unemployment rate as a key monetary-policy gauge. The Keynesian idea here is that too many people working cause inflation. So with a 9.7 percent unemployment rate, she can be expected to back Fed head Ben Bernanke in his quest for continued free money, with the other new doves following suit.

Make no mistake about it. These appointees (along with Daniel Tarullo, an earlier Obama appointee and another dove) make for an easy-money, pro-regulation Fed. As for monetary soundness, price stability, and a reliable King Dollar, these highly credentialed academics won’t pilot us there.

California economist Scott Grannis recently blogged about “easy Fed, strong gold.” The yellow metal, which has proven to be the best indicator of currency confidence, continues its upward trend against the dollar, and for that matter against the euro and Japanese yen. Grannis also has been writing about the surge in commodity prices, which are marching onward and upward in a V-shaped recovery. Grannis, in other words, is tracking the appropriate indicators.

Many supply-siders, including myself, believe that commodity prices in the open market are the best measures of whether money is too tight or too loose. But no one on this new Obama monetary team will be paying much attention to gold and commodities. They believe in the so-called Phillips Curve tradeoff between inflation and unemployment, despite the breakdown of that model back in the 1970s, when both measures rose together, and for most of the 1980s and 1990s, when both measures fell together.

Indeed, more people working more productively will create more economic growth to absorb the money supply and maintain very low inflation. On the other hand, the $2 trillion Fed balance sheet — which embodies the creation of a massive new volume of the high-powered monetary base, to draw on Milton Friedman’s analysis — sets the stage for too much money chasing too few goods and a steady depreciation of the dollar.

In this scenario, enter one Thomas Hoenig, head of the Kansas City Fed.

Hoenig is a rising monetary superstar who has dissented at each of the last three Fed open-market meetings. He believes money is too loose, and says that if this continues, we risk a new financial bubble that ultimately will come to no good end. I believe Hoenig’s warnings are right on target.

At its meeting this week, the Fed chose to ignore clear signs of a stronger-than-expected V-shaped recovery, along with the bubbling-up of commodity prices and double-digit gains in the producer price index. This is a high-risk strategy. It points to no plan for exiting the zero-interest-rate policy that continues to govern long after the financial and economic emergency has passed.

My own view is that we need a dose of what I call cowboy monetarism. By that I mean the Fed should surprise Wall Street traders with unexpected policy restraint in order to keep them from taking excessive risks in their financial dealings. Like the cowboy’s of the Old West, who would act in their own defense at a moment’s notice, the Fed should not be afraid to pull the trigger on some small restraining moves now to prevent new financial bubbles and an outbreak of inflation down the road.

Wall Street economist Mike O’Rourke criticizes the Fed for cutting and pasting the same predictable phrases from the same predictable policy at each successive Fed meeting. The Fed basically did it again this week. And this is exactly the same mistake it made during the 2002-05 period when the last bubble was born.

Some small restraining signals now might save us a lot of aggravation later. But the Obama doves are going to resist this approach.

The downside of this stubborn adherence to failed monetary theory may not only put the soft-money Obamacon doves at war with the hard-money Reserve Bank hawks, it could do great damage to hopes for a recovery in American prosperity in the years ahead.

Apparently there is to be a vote later today on a bill regarding Puerto Rican statehood. They are calling it “non-binding” but it is not non-binding! It is a trap. The bill makes eventual Puerto Rican statehood a virtual certainty. This is despite the fact that statehood has been voted down repeatedly. The Puerto Rican people don’t want it!

But since when has that stopped the Left from ramming what they want down people’s throats? And why do they want this? The same reason they want everything, to further entrench their power. Statehood would mean two new senators, six or seven new representatives, a whole slew of new voters and tons of opportunities to spend more of your money. As Examiner.com’s Robert Moon points out:

Due to its dense population of poverty-stricken minorities, Puerto Rico can be counted on to vote overwhelmingly for Democrats and all their handouts, and their representation will also consequently outnumber that of 25 other existing U.S. states.

Meanwhile, with Puerto Ricans having an average income of less than half that of our poorest state, they will instantly become eligible for dozens of our welfare programs. Truckloads of taxpayer dollars will also have to be perpetually dumped into the territory, by federal law, to bring it up to American infrastructure and environmental standards.

Oh, and never mind us. We don’t get a say in this either. Puerto Rico, which doesn’t want statehood, is being forced to vote, while we American citizens, who have a vested interest in the outcome, will not be given the opportunity to vote! Simply incredible!

HR 2499, titled “A Bill, to provide for a federally sanctioned self-determination process for the people of Puerto Rico” follows a very devious, underhanded multi-step path to essentially force Puerto Rican voters to eventually adopt statehood. Here’s how.

The bill first authorizes Puerto Rico to hold a vote where they are given the following two choices only:

1. Puerto Rico should maintain its current political status.
2. Puerto Rico should have a different political status (Different political status. These vague words are exactly as in the bill.)

So citizens get to choose 1 or 2. Period, no ifs, ands or buts. Then the bill stipulates what comes next:

If the people pick option 1 – which they have chosen multiple times already – then the Puerto Rican government is directed to conduct more plebiscites every eight years for the foreseeable future. So in other words, Mr. Puerto Rican citizen, we are going to keep cramming this down your throat until a majority of you choose option 2.

Once the people choose option 2, then there will be a second vote with the following three options:

1. Full independence.
2. Sovereignty “in association with the United States…” not subject to the Constitution’s Territorial Clause.
3. Statehood.

For the record, the first two options will not get much support. So the entire structure of the bill is designed to funnel Puerto Rican voters into a predetermined outcome: Statehood. This despite the fact that Puerto Ricans have voted against statehood over and over again!

Rep. Luis Gutierrez, a senior Democrat Congressman no less, just posted his views on this bill at Huffington Post. Here is what he has to say about it:

I am a senior Democratic Member of Congress, whose parents were born in Puerto Rico, and for whom Puerto Rico self-determination has been – and remains – a central issue of my congressional career. This statehood bill is the opposite of self-determination.

It is designed to craft an artificial majority for statehood where none exists now. Every time the people of Puerto Rico have been consulted on this issue through a plebiscite they’ve said NO to Statehood. NO to Statehood in 1967. NO to Statehood in 1993. NO to Statehood in 1998. This should be called the “Don’t you dare say NO to Statehood Bill”.

But he is just getting going. Listen to this:

When a similar Puerto Rico bill came up under Speaker Newt Gingrich’s Republican controlled Congress a decade ago, it was the product of lengthy and thorough hearings and an open and fair process. Then, I was given time to offer seven amendments. Then I was able to clarify the bill for the Puerto Rican people. Then, each of my seven amendments got 30 minutes of floor time for debate.

Flash forward to now. Now a Democratic Majority Congress is only allowing me two of the 16 amendments I offered in the Rules Committee on Wednesday. Now I only have 10 minutes to debate each one.

Now, under Democratic Leadership, we get one hearing, no forewarning, no companion Senate bill, and a debate only a few seconds longer than a NASCAR pit-stop…I get more time to debate renaming a Post Office than I will get to debate a bill that could make Puerto Rico the fifty-first state.

In my opinion, this bill is the political equivalent of a shady Goldman Sachs derivative: It’s secretive. It lacks transparency. It’s likely to blow up down the road and cause systemic risk to out democracy. And those who put this political derivative together don’t really tell you what this is really about and will play dumb when it explodes.

We all know now from the outrageous experience of Obamacare that leftists could care less what the will of the people is. For those of you who traditionally vote Democrat this should serve as a warning: that includes you! Even if it’s those poor, downtrodden Puerto Ricans the Left claims to want to help so much. Ram Obamacare down Americas’ throat; ram statehood down Puerto Rico’s throat.

Do I detect a pattern here?

This information needs to go viral. Congress needs to be shut down with phone calls and faxes starting first thing in the morning. That is today, April 29, 2010.

All this is going on while everyone is distracted by the monstrous financial bailout bill coming out of the Senate. The timing was deliberate! And we now hear that despite losing support from lone RINO Republican Lindsey Graham, the Democrats are going to go ahead with illegal immigrant amnesty.

So now we see a pretty comprehensive electoral strategy mapped out:

1. Naturalize 12 million illegal aliens to vote Democrat
2. Universal voter registration
3. Do away with Electoral College using state-by-state approach
4. Force Puerto Rican statehood
5. Soros-funded Secretary of State project to help steal close elections
6. Stimulus monies as political slush fund

If you’re not sufficiently angry and alarmed now, there is no hope for you. These people are demonstrating right to our faces their willingness to trample our rights and defy our will. If they are willing to do this now, what will they do if they get the permanent majorities they want?

The more details that emerge about the Obama-Dodd financial “reform” bill, the worse it smells. The bill is most certainly an attempt to give the government vastly more power and control over the economy. And despite the vocal, condescending, even mocking protestations from Democrats and their allies, this bill does in fact contain unlimited bailout authority for the Fed. It’s right there in the bill for the world to see.

But it is increasingly evident that there may be something more sinister going on behind the scenes that is driving this debate.  The President trotted up to New York to give a big televised speech and scolded Wall Street for “resisting reform” saying that if we are to prevent another crisis, we must pass his bill.

The whole charade amounted to little more than political theater.  Big Wall Street banks actually WANT this bill.  Executives for Citigroup and Goldman Sachs (two firms that both received bailout funds) have both made statements in favor of Obama’s financial reform bill.

So, one must ask, if this is so draconian on Wall Street, why do they want it so badly?  The answer to this question is in the details of the bill: Not only does this bill not rein in big Wall Street banks, its actually a very big gift to Big Banks and other special interests—gifts that will cost Main Street, the taxpayers and consumers.

The large financial institutions at the root of the financial crisis wouldn’t even be regulated by the CFPA. Their oversight would remain at the porn-surfing Securities and Exchange Commission. But of course the bill is full of burdensome regulations for smaller institutions with which they will struggle to comply and also remain profitable.  The larger banks that are covered will not only have the resources to adapt but will also likely grow even larger by swallowing up smaller institutions that can’t make it.

But big banks aren’t the only ones receiving special favors. Mark Calabria of the Cato Institute highlighted some egregious examples of special interests using this bill as a vehicle for their own desires in a recent NY Post article, saying:

Remember the mortgage crisis? Well, the primary consumer-protection law for homebuyers is the 1974 Real Estate Settlement Procedures Act. The law requires the timely, accurate disclosure of relevant closing costs and prohibits “kickbacks” for the steering of settlement services.

For example, your real-estate agent cannot, under RESPA, be paid a fee for steering you toward a certain home inspector, title company or other closing service. Yet, under the Dodd bill, real-estate agents would be exempted from RESPA. If that weren’t bad enough, the Dodd bill exempts insurers and attorneys — both now subject to RESPA — from its consumer protections, too.

So, the big banks are not only getting off scott-free, but they, real estate agents, title companies, lawyers and other special interests are attempting to further rig the system permanently in their favor.

And if all the advantages given to the banks in this bill still aren’t enough to help weather the consequences of their risky behavior?  Well, that’s what the bailout language is for. The Barney Frank bill authorizes up to $4 trillion dollars in lending authority for the Fed. Dodd’s bill gives them a blank check with no limit.

But these gifts come at a cost. And the bailouts are only the down payment.  The Obama-Dodd bill would give the government unprecedented reach into the business place and create real harms on Main Street.

• Local community banks will be subject to at least 27 new regulations that could put many of them out of business.
• Harley-Davidson is worried that its dealer-financed loans to bikers will fall victim to new federal financing regulations.
• eBay may be harmed by restrictions on PayPal, a subsidiary, in moving money in the Internet marketplace.
• Small businesses that rely on credit cards, small credit lines, home equity loans and other types of credit will lose access to these life lines that keep their businesses operating—and employing workers.

But, Wall Street gets the bill that it wants. And that’s what’s important right? Apparently it is for those pushing this bill.

Everyone wants to avoid a new financial crisis (except perhaps Goldman Sachs and John Paulson who made billions on it). But the manner in which that is done is crucial.

Rather than addressing the root causes of the crisis, this bill avoids them entirely.  Rather than addressing the entities involved with causing the crisis, this bill rewards them and harms Main Street. Rather than doing away with too big to fail, this bill encourages risky behavior and makes big firms even bigger by rigging the system in their favor against community banks and other small lending institutions.

All of which is why Wall Street wants it so badly.  Because as anyone who watched the Senate hearing with Goldman CEO Blankfein understands, Wall Street knows how to spot a “sh$%^y deal” so this one must be a sweetheart.

After Republicans suffered consecutive bruising defeats in 2006 and 2008, boastful Democratic Congressional Campaign Committee officials warned that Republicans faced a difficult decision: Go along with the sweeping agenda of the new administration, or suffer the disastrous consequences of taking on an enormously popular president in the 2010 elections.

Perhaps the GOP of 2005 would have taken the bait and swallowed the administration’s bad medicine. After all, Republicans during that period were guilty of spending too much and growing government too much, both of which would become hallmarks of the February 2009 stimulus plan and the loaded agenda that would follow. That GOP became a bloated, go-along to get-along body that forgot how to lead. We blew it, and we were rightfully fired by our bosses – the American people.

But the GOP in the House today is different. Very different. Led by a new generation of young and energetic leaders, we are committed to restoring the public’s trust in our ability to lead as responsible adults.

Let’s take a look at the last 16 months.

In the face of one-party Democratic rule, House Republicans learned fairly quickly that an election won on ‘change’ would result in a far more intrusive and expensive government. At the time, many political pundits joined the chorus of Democrats who warned that House Republicans faced political suicide if they didn’t support the President’s signature inaugural initiative – his stimulus plan. Yet we decided to fight. And we fought hard. The reason we were able to credibly oppose such a popular President was because we presented a much more responsible approach that would have created twice the jobs at half the cost of the eventual stimulus law that has failed to deliver as promised. A 178-seat minority isn’t going to win many legislative battles in the House. But it did prove sufficient to offer a clear contrast and provide the first glimpse of a Republican Party that had returned to its fiscally conservative roots.

From that moment, a revitalized House GOP dedicated itself to developing alternative solutions grounded in the fiscally responsible, small-government principles proven to work for our economy. On the stimulus, instead of pouring hundreds of billions down the rat holes of un-stimulative government programs, we proposed to give private-sector job creators an incentive to hire by exempting small businesses from 20 percent of their tax liability. On health care, instead of the budget-busting government takeover known as Obamacare, we provided solutions such as medical liability reform and purchasing health care across state lines which would lower costs while enabling families and patients to keep the care they have if they liked it. To create real jobs, we offered a “no cost Jobs plan” that would cut unemployment by approving lingering free-trade agreements and halting the deluge of ‘Obama tax increases.’ And on the budget, not only did we challenge President Obama to freeze spending at last year’s levels, but we offered cuts that would save taxpayers more than $375 billion.

We even challenged President Obama in a letter to help us force a vote in the House on the modest budget savings he proposed but which have been ignored by the Democrat majority. As has become routine, we have yet to receive a response.

Washington is always talking about the unlimited ways to increase spending. How about instead we start spending a lot more time talking about ways to cut expenditures and save money. That’s one reason why this Republican Conference adopted an earmark moratorium so we can finally start to fix a process that’s been broken for years. Could you imagine the Republican party of five years ago taking that step?

The point is that in each of these circumstances, we have stood up against an administration and a Pelosi-led Congress hell-bent on reorienting the role of government in America. While we may not have the numbers, our fight and conviction remains strong.

We understand that if our government is going to continue to spend and insert itself into the private economy the way that the Obama Administration and the Pelosi/Reid Congress has, then the America we know and love is in trouble. We will face steeper taxation, slower growth, higher unemployment and less economic opportunity for everyone. That may be a sacrifice Democrats are willing to stomach on their way to creating a European-style social welfare state. But for us it’s an unacceptable and radical departure from the American way.

America is a nation at a crossroads, and it is up to each of us to determine what kind of country we want to be. We must not leave our children a country more in debt and worse off than we found it, and I believe it is one of the biggest moral obligations of our time to act now to put a stop to what is happening in Washington. That means listening to the American people. It means spending less and saving more. It means pushing common-sense solutions that serve the national interest, not the special interests. And it means ensuring that our children have the same opportunity to achieve that we were given.

I am under no illusions – both parties have helped to create a debt that everyone knows is dangerously high. But only one of them is going to keep going down that path and taking our country with it. The other has learned its lesson and has reformed itself.

As we reported a few weeks ago, White House Deputy CTO Andrew McLaughlin became ensnared in the Google Buzz privacy controversy when his Gmail contacts were made publicly available through his Buzz profile, which included 28 senior Google lobbyists and lawyers.

The controversy has prompted a slew of letters and FOIA requests to the White House and Department of Justice from watchdog groups.  Last week, Congressman Darrell Issa sent a letter to McLaughlin asking whether the deputy CTO may have been using Gmail to communicate with his former employer, thus circumventing the laws associated with openness and transparency.  Issa gave McLaughlin a deadline of this week to answer a series of questions on what the Deputy CTO is doing to comply with official recordkeeping rules.

Now we’ve learned that another ex-Googler working in the Administration, Katie Jacobs Stanton, has been snagged by Google’s lax privacy settings as well. Like McLaughlin, Stanton — the New Media Director at the State Department — had 17 Google employees in her Gmail account exposed in the Buzz privacy flap, as the screenshots below indicate:

Katie Jacobs Stanton was President Obama’s appointee to the newly created position of Director of Citizen Participation in March of 2009 and recently moved to the State Department as the New Media Director.  Her previous responsibilities at Google included Google Moderator, Google Finance and Google’s Open Social initiative.

While Stanton’s Buzz followers aren’t as jam-packed with Google lawyers and lobbyists as McLaughlin’s Buzz profile, her contacts are interesting nonetheless.  Googler Ginny Hunt for instance, shows up in Stanton’s profile and is the head of the mysteriously-named Google Public Sector Lab.

What’s the Google Public Sector Lab?  Who knows… There’s no website that we were able to find and very little information about what it actually does.  But a post by Ms. Hunt on Google’s official blog suggests that the Public Sector Lab is involved in Google’s government business through Google for the Public Sector, the division that provides a “one stop shop of tools and tips that local, state and federal government officials can use.”

Ironically, Hunt also posted about Google’s partnership with the Sunlight Foundation’s Public=Online campaign, which urges citizens to “hold public officials accountable for being open and transparent.”  Google provides financial support to the Sunlight Foundation and Google’s Kim Scott sits on the board.

Setting aside for a moment the practicality or usefulness of conveying official government policy in 140 characters or less via Twitter, Buzz and other social media tools, Stanton’s publicly available social media posts cross-posted at Buzz and Twitter under her KateAtState moniker also offer some delicious insight into the world of the new social media Googlecrats:

The mundane and trivial…

the policy oriented…

and, not surprisingly, what looks a lot like Google flackery…

Her first tweet above is about Google Public Data Explorer, a tool to make Google visualizations of government data more useful. Who’s in charge of Google’s Public Data Explorer? It’s apparently this guy, Ola Rosling, from Stanton’s Buzz contacts:

Rosling is the product manager for the service and also the son of Hans Rosling, a Swedish inventor who developed a statistical software package called Trendalyzer acquired by Google in 2007.  Thus, the more government data Google can get its hands on, the more valuable the Trendalyzer software package becomes… to Google.

Stanton’s second tweet is interesting as well.  Here she links to a fawning blog post by Tim O’Reilly about the Haiti earthquake and all of the cool Google tools people can use to track the action.  O’Reilly posts that “Google quickly sprang into action reusing many Haiti built tools”, followed by links to Google’s Crisis Response page, person finder built on Google’s AppEngine, and Google’s Mapmaker download.

Stanton’s third tweet posts a link to a Google Maps mashup showing “The Best of Health Care Floor Debates”… from Republicans!  It’s a mashup created by the House GOP Conference with links to all speeches “against the government takeover of health care.”  While Republicans probably appreciated Stanton publicizing their speeches against “government run health care”, skeptics might point out that this looks suspiciously like flackery for yet another product from Stanton’s ex-employer.

In fairness, Ms. Stanton is a prolific twitterer and promotes other tools like Facebook in her tweets as well.  Her job in fact, appears to be working “with technologists and diplomats to harness IT” as part of 21^st century statecraft, as was recently pointed out in this interview with Stanton for Federal Computer Week.

But that’s where things can get dicey and where Stanton’s Buzz contacts take on new and potentially significant meaning.  In contrast to McLaughlin’s contacts which were mostly senior lobbyists and lawyers pushing for policies that affect Google and its competitors, Stanton’s contacts appear to be dominated by those Googlers involved in developing the types of IT products that the federal government and State Department might use or purchase.  That’s not necessarily a problem assuming federal procurement rules are being followed.  But, federal procurement is a rigorous and exacting process designed to protect against the favoritism and cozy relationships that can occur when big corporate supporters of a President’s campaign look for payback through lucrative government contracts when their candidate takes office.

Google was a huge supporter of President Obama’s campaign, contributing over $800,000 to his election effort.  CEO Eric Schmidt and Google’s senior execs were early supporters of the campaign and actively stumped for the candidate, with Schmidt even serving as an economic adviser during the campaign.  After Obama was elected, Schmidt and several other Google executives contributed $25,000 apiece to pay for a huge inaugural bash.  Google was rewarded with Schmidt’s appointment to Obama’s Council of Science and Technology Advisers.

In fact, Federal Computer Week hints at the cozy relationship between the search titan and the Administration in its February interview with Stanton:

These days, Foggy Bottom has Silicon Valley’s back, as illustrated by Clinton’s public request that the Chinese government investigate allegations that recent cyberattacks on Google originated in China.

The Wall Street Journal’s Kara Swisher goes further, pointing out in February that “it will likely be like they never left the Googleplex in Silicon Valley if this Washington, D.C invasion of execs from the search giant keeps up.”  Swish pointed out that there are many potential issues surrounding “so many key appointments in the tech arena going to one company, especially one so immersed now in national and international policy issues.”

Andrew McLaughlin’s answers this week to Congressman Issa’s letter may shed some light on the nature of his email communications with lobbyists from his ex-employer.  But Stanton’s Buzz contacts raise more questions about the murky world of Google’s partnership with the federal government and whether ex-Googlers in the Administration are serving the interests of the taxpayer or the interests of Google.  In any case, Congressman Issa might want to keep his pen handy.

Incidentally, like McLaughlin, Stanton’s Buzz profile has now been deleted.

The Associated Press has a story this morning called “Unemployment challenges Obama’s economic narrative.” No kidding.

I never get tired reminding stimulus advocates that before the stimulus bill was passed, the president scared the bejesus out of many people by claiming that if the Stimulus bill wasn’t passed, unemployment would reach 8.8 percent. Also, his team promoted the idea that the stimulus would create 3.3 million jobs (not just saved). They even had numbers and a model to prove it.

So the president got his cash, $789 billion which grew to $862 billion, and unemployment kept going up. It even passed 10 percent at one point and is now stagnating at 9.7 percent–where it’s scheduled to stay for a while.

And it’s not the only “job bill” that was passed. There was one in March 2020 ($18 billion) and another one in April 2010.

By the president’s own logic, the stimulus failed. That’s why he  has shifted his argument. Sure, the economy lost jobs, he now says, but without the stimulus it would have lost nearly 2 million more jobs. How you go about proving that this is not true is impossible and this is why it’s not powerful. It doesn’t make it right.

More interestingly, shocking, and sickening is the role that the Congressional Budget Office plays in this drama. How many times have you read that ” The nonpartisan Congressional Budget Office estimates that as of the end of 2009, last year’s $787 billion stimulus package had created 1.4 million to 3 million full-time-equivalent jobs that wouldn’t have existed otherwise.”

Never mind, by the way, that, as Heritage Foundation’s Brian Riedl noted a few weeks ago, CBO never even bothered to check how many jobs were “created or saved” in the post-stimulus economy. They just assumed that what they had predicted would happen, did actually happened.

“This is like a weather forecaster saying that the high yesterday was 65 degrees, because that is what had been predicted — even though it actually never topped 50 degrees.

Now, CBO director Doug Elmendorf has finally conceded that they never actual examined this stimulus bills’ affect on the economy. Responding to a questioner following a recent speech, he admitted that the CBO’s jobs count was “essentially repeating the same exercise” as their initial projections. When asked if this means their jobs projections would have ignored any failures of stimulus spending to perform as CBO predicted, Mr. Elmendorf responded “that’s right.” (Exchange begins at 38:20.)””

Watch it and send it around. It’s unbelievable.

If you want a true picture of the failures of the Obama stimulus bill think about the following. Not only is unemployment high and will stay this way for a while, but the people who are unemployed stay unemployed way longer than they used to. The chart below shows that no job bill or stimulus is changing that trend. In fact, it might be creating the trend.

The Associated Press has a story this morning called “Unemployment challenges Obama’s economic narrative.” No kidding.

I never get tired reminding stimulus advocates that before the stimulus bill was passed, the president scared the bejesus out of many people by claiming that if the Stimulus bill wasn’t passed, unemployment would reach 8.8 percent. Also, his team promoted the idea that the stimulus would create 3.3 million jobs (not just saved). They even had numbers and a model to prove it.

So the president got his cash, $789 billion which grew to $862 billion, and unemployment kept going up. It even passed 10 percent at one point and is now stagnating at 9.7 percent–where it’s scheduled to stay for a while.

And it’s not the only “job bill” that was passed. There was one in March 2020 ($18 billion) and another one in April 2010.

By the president’s own logic, the stimulus failed. That’s why he  has shifted his argument. Sure, the economy lost jobs, he now says, but without the stimulus it would have lost nearly 2 million more jobs. How you go about proving that this is not true is impossible and this is why it’s not powerful. It doesn’t make it right.

More interestingly, shocking, and sickening is the role that the Congressional Budget Office plays in this drama. How many times have you read that ” The nonpartisan Congressional Budget Office estimates that as of the end of 2009, last year’s $787 billion stimulus package had created 1.4 million to 3 million full-time-equivalent jobs that wouldn’t have existed otherwise.”

Never mind, by the way, that, as Heritage Foundation’s Brian Riedl noted a few weeks ago, CBO never even bothered to check how many jobs were “created or saved” in the post-stimulus economy. They just assumed that what they had predicted would happen, did actually happened.

“This is like a weather forecaster saying that the high yesterday was 65 degrees, because that is what had been predicted — even though it actually never topped 50 degrees.

Now, CBO director Doug Elmendorf has finally conceded that they never actual examined this stimulus bills’ affect on the economy. Responding to a questioner following a recent speech, he admitted that the CBO’s jobs count was “essentially repeating the same exercise” as their initial projections. When asked if this means their jobs projections would have ignored any failures of stimulus spending to perform as CBO predicted, Mr. Elmendorf responded “that’s right.” (Exchange begins at 38:20.)””

Watch it and send it around. It’s unbelievable.

If you want a true picture of the failures of the Obama stimulus bill think about the following. Not only is unemployment high and will stay this way for a while, but the people who are unemployed stay unemployed way longer than they used to. The chart below shows that no job bill or stimulus is changing that trend. In fact, it might be creating the trend.

In my last article, we began a discussion of GOV2.0.  Over the next couple weeks, I’ll sketch some sexy details.   Commenters, keep tossing out your ideas.

Tea Partiers!  Here’s how to save every state budget.  Let’s hoist our pirate flag high.

In New York City a movie ticket costs $15 – about $7.50 a hour.   Three months later it is out on DVD, and you can own it for $15.  Twenty eight days later, you can put it, along with thousands of other movies, in your Netflix queue for $9 a month.  Eighteen months later, it plays on HBO, along with a great show about having multiple wives, for $10 a month.

Or, if you prefer, you can download a watchable copy of the movie the day it comes out for free… because a lone pirate secreted a HDcam into a theater and jacked into the hearing impaired outlet in his seat.

The movie cost $150MILLION to make.  The hooligan did it for free.

And oh, by the way, if your kid is still buying music, you might sit her down for a talk about the virtues of sharing.

For the rabid capitalist, it is crucial to recognize that property rights emerge from the scarcity of the atomic.   There is value in creative ownership, but let’s be rational… if we could copy land, food, and oil, the concept of “ownership” would be radically different; there would be riots in the streets if limits on these staples were artificially enforced.

Meanwhile, Wikipedia has this entry called “Public Ivy,” showing plenty of state funded gold plated colleges to plunder.

Some more napkin math: the average tuition per student at an out-of-state Public University is $18,548.   Assuming 15 hours of classes for 32 weeks (two semesters) – a single hour (one lecture) runs about $38; that’s 5X what an hour of a $150Million Hollywood blockbuster costs you.

You know where this is going, right?  Why in the bejesus are we not paying kids to record their professors’ lectures and put them online so we can steal them for our own use?

Why haven’t all these lectures been legally placed in the public domain, so that Internet companies can build businesses persuading kids to skip school, save money, and graduate online?

Without getting too deep into webco start up jargon, I think everyone groks the basics of evergreen content.   In this context, we’re talking about video files that do not decrease in value as they grow older (like movies).

Example:  Lecture #11 of Professor Warstler’s ECON204: “Public Goods” is the same every damn semester.  And yet, twice a year, 100 new students are packed into a room to listen to him say the same damn thing for $3800.00 per hour.   It rarely changes, but next year, kids will pay even more to hear him say it again.  Even crazier, there’s another professor 250 miles away teaching the same class.

In web economics, this situation is GOLD.   Because unlike a Hollywood blockbuster or “Chocolate Rain” that gets all its action right after its launch, a single recording of  Warstler’s ECON204 lecture can be improved endlessly and watched by millions of people over the next twenty years.

If you have any nagging doubts, think of the glorious new private sector businesses that can be built around this public domain content!

Imagine online colleges where you only pay a couple of bucks when you have a question or need to have a test graded. Imagine college that comes free when you buy a new $500.00 55″  LCD TV at Wal-Mart.   Imagine being able to test similar lectures from hundreds of professors to see which one is best at conveying information to visual learners, kids from the ghetto, or you when you are sixty.  Imagine needing only a fifth/tenth/twentieth of the college professors to teach three times as many students.

The truly talented faculty who survive will be high paid rock-stars with staffs.   Like Paul Krugman without a beard or inflation fetish.

Sure, if your kid needs to have the good old college experience and put himself (and you) $150K+ in debt, then by all means you can send the lad off to the glories of keggers and Marxist re-education.

But if he’s an over-achiever, he can start taking college courses about whatever interests him when he’s in ninth grade, or working as a convenience store clerk at night, or sitting in jail, or if he just doesn’t understand the shitty professor you are PAYING for him to sit in class with right now. 

Why, in a copyable economy like public education, doesn’t every child deserve the lessons of the world’s premiere  teacher in every subject?

This information wants to be free.  And the best way to make that happen is to make it legal to copy and profit from the improvement of it.   Moreover,  it is a public good.  Our tax dollars pay for it.  It is ours.  We want it hocked for pennies on every street corner.  There is no better example of Schumpeter’s Creative Destruction.

National and state Republicans, get cracking.  Promise to make in-class recordings in every public university legal and distributable under a Creative Commons license that allows commercial application.

In ten years time, every state budget will be in balance.  The very best video lectures will improve daily, educate millions online, and thousands of liberal academics will have to go get real jobs.

I kid you not.

A small change to your state’s rules about recording in the classroom, can save your family thousands in taxes and hundreds of thousands in tuition.

Demand it.

At a time when the American taxpayer is on the hook for trillions in current and future federal spending—when the Congressional Budget Office warns that the current rate of federal spending is “unsustainable”—liberal Democrats in Congress have earmarked over $68 million of taxpayer dollars for a Boston shrine to the late Senator Edward Kennedy.

In a detailed report, the Boston Herald describes the planned Edward M. Kennedy Institute as a “temple for Ted Kennedy built with pork.”

According to their account, congressional Democrats—especially Massachusetts senators John Kerry and Edward Markey—have been cramming earmarks for the project into various government funding bills. The Herald found that Kerry and Markey even intend to siphon $28.9 million of the institute’s funding from the Defense Department budget, with almost $19 million of that amount already signed into law.

Why do they think taxpayers should be paying for this shrine? A statement from a Kerry spokesman declared that the institute will bring “knowledge and good citizenship to thousands of young people.”

This has raised the ire of taxpayer watchdog groups. “If the Kennedy family wants to honor the senator, they should find a way to fund it themselves,” David E. Williams of Citizens Against Government Waste told the newspaper. Steve Ellis of Taxpayers for Common Sense agreed that “this could be independently funded and doesn’t need to be getting taxpayer dollars.”

Indeed.

Clearly, it’s not as if the Kennedy clan is without financial means to fund the project themselves. Or, if they wished, they could send out private appeals on the family stationery to, say, George Soros—or to John Kerry’s wife, catsup heir Teresa Heinz Kerry—right from their posh family compound in Hyannisport. I’m sure Laurie David could be prevailed upon to throw a fundraiser in memory of “the lion of liberalism” at the Beverly Wilshire.

However, their reliance on federal funding suggests a broader agenda is in play. After all, in an era of trillions in red ink, why would congressional liberals insist on adding tens of millions to a national debt that their president has promised to “get serious about”? Why earmarks for something that most Americans would find to be a frivolous expenditure?

Obviously because liberals don’t think of it as a frivolous expenditure. In fact, it is a project of great importance to them—because it’s meant to establish an official, symbolic, governmental shrine to political liberalism.

Consider: What, exactly, is significant about Senator Kennedy? What does he symbolize?

To millions in Flyover America, “Teddy” was despised as a pampered playboy, known for decades of drunken philandering even after his unforgivable role in the death of a girl in Massachusetts.

But to the left, Ted Kennedy was and remains an icon of liberalism—and specifically, a lifelong champion of socialized medicine. That, after all, was his signature cause.

So, I believe that establishing Teddy’s Temple with millions of taxpayer dollars is meant to serve twin purposes.

First, it is intended to enshrine the pretense that one’s politics is more important than any other aspect of one’s personal character. The issue here transcends Kennedy. A central pillar of the liberal worldview is its sweeping rejection of self-responsibility—its claim that no one is ultimately responsible for his actions, but is instead a victim or plaything of circumstances beyond his control. Liberals forgave Kennedy for his personal failings just as they did Bill Clinton—because in their worldview, nobody is to be held individually accountable, either for his sins or his virtues. The ironic flip side of this premise is that everyone is instead his “brother’s keeper,” responsible for everyone on the planet except himself.

Thus, professing liberalism gives you a free pass for all manner of personal immorality and irresponsibility. All you need to do to dry clean your reputation is to advocate policies that promote egalitarian “fairness” toward your fellow “victims of circumstance.”

Second, Teddy’s Temple is a means to an even broader end. That end is to elevate his liberal ideology to the status of an official, government-approved “ideal.” You can be sure that the “good citizenship” propagated at his shrine will translate into speeches, writings, video clips, totems, classes, and materials extolling his liberalism generally, and his advocacy of socialized medicine specifically—all paid for with your hard-earned dollars.

The leftists backing this institute know all this, and they intend for precisely these lessons to be preached there and absorbed by future generations. They understand perfectly well the power of moral symbolism and government-imposed “standards.” So, the Edward M. Kennedy Institute is calculated to establish liberalism’s anti-self-responsibility ideology as a national moral doctrine, to supplant the American legacy of individualism and personal self-responsibility that they despise.

I believe there is a third, more subtle goal here, too. Senator Kennedy was a fierce opponent of a strong national defense generally, and of virtually every specific military action our nation has conducted since World War II. Diverting millions from the Defense Department budget to the Kennedy Institute can only symbolize the liberal value hierarchy, which places a moral priority on domestic social-welfare programs over national defense.

Opposition to federal funding for the Edward M. Kennedy Institute has focused almost exclusively on its ballooning costs to the taxpayer. But we should not oppose this simply as a wasteful and unnecessary expenditure of federal funds. We should oppose the use of taxpayer dollars for this project on grounds of ethical principle—as both an explicit and symbolic rejection of American individualist ideals, and as a deliberate slap in the face of our men and women in uniform.

Thomas Jefferson summed up concisely the moral issue at stake: “To compel a man to furnish contributions of money for the propagation of opinions which he disbelieves is sinful and tyrannical.”