Government Investments

According to an item in the Atlanta Journal Constitution...

The idea sounded terrific. Use tree waste to create fuel, help break our dependence on Mideast oil, and create hundreds of jobs in rural Georgia to boot. What's not to like about that?

One problem. The Range Fuels cellulosic ethanol factory is now closed. Apparently, it wasn't such a terrific idea. Unfortunately, approx. $162 million in federal, state and local grants is now up in smoke.

While $162 million is relative chickenfeed in an era where we have all discovered the number "trillion", this anecdotal episode is instructive regarding government "investment", aka spending taxpayer dollars.

I would imagine it went down something like this...

Owner of Range Fuels to state Senator Foghorn: Ralph, I got a great idea for alternative energy and creating jobs. We make fuel out of tree waste. We call it cellulosic ethanol and...

Foghorn: How much?

Owner: Excuse me?

Foghorn: How much, boy, tell me what ya need.

Owner: Uh, I don't know, maybe $162 million.

Foghorn: Consider it done. I know the local boys will pony up some of it, cuz I got pictures they don't want the world to see. But I'll need to call Senator Blowhard in Washington, give me just a minute...Blowhard you ol' sumbitch, it's Foghorn...

Blowhard: How Much?

Foghorn: You even want to know what it's for?

Blowhard: Not really.

Foghorn: How soon?

Blowhard: We're voting on a bill tomorrow to keep orphans from starving, I'll stick it in that.

Foghorn: My best to the Missus.


The moral of the story is that when you're playing with other people's money, you're not as prudent as when your own money is at stake. When we hear about government "investments" in things like clean energy, we should ask ourselves whether they are using sound investment principles or simply picking winners and losers on the basis of political connections.

Change in the Air?

Leaving aside for now the fiscally laughable budget proposed by Obama yesterday, I have a question...

Everyone recognizes that unless entitlement spending is reformed, any other attempts to reduce the federal debt won't save the country from disaster. Is the public ready for significant entitlement reform?

I see where New York governor Andrew Cuomo is enjoying a 77% approval rating, despite proposing serious cuts in state spending that according to reports could lead to the layoff of 10,000 state employees. In a deeply blue state, that's pretty amazing.

Chris Christie in New Jersey, another strongly blue state, has an approval rating of 51% despite his aggressively conservative fiscal policies.

Is the public's attitude toward hitherto untouchable public programs beginning to shift? If so, will it be too late?
 

What's Next?

According to a poll taken by the Pew Research Center last year of the Egyptian people...

 

30% have a favorable view of Hezb'allah

49% have a positive view of Hamas

20% have a positive view of al Qaeda (72% have a negative view)

19% have a positive view of Osama bin Laden

48% say Islam plays a large role in their country's political life

85% consider Islamic influence over political life to be a positive thing for their country

61% see no struggle between those who want to modernize their country and Islamic fundamentalists

54% support making gender segregation in the workplace the law in their country

82% endorse the stoning of people who commit adultery

77% support whippings and cutting off of hands for crimes like theft and robbery

84% support the death penalty for those who leave the Muslim religion

59% say democracy is preferable to any other kind of government

20% support suicide bombing in defense of Islam

46% say suicide bombings are never justified

61% express concern about Islamic extremism in their country

While we must always be wary of polling data, if the above data is reasonably accurate, it paints a somewhat confusing picture of the Egyptian people. On the one hand, it's difficult to mourn the departure of Mubarak. On the other, what's coming next? In terms of our interests, should we be happier with a dictator like Mubarak, who if nothing else maintained peace with Israel? Or elections in which the Muslim Brotherhood could acquire power? The Brotherhood is not, as Director of National Intelligence James Tapper says, a largely secular group that eschews violence.

I can't help but wonder if the administration should temper its enthusiasm till it knows the final outcome.

Mitch Daniels at CPAC

The link below will lead you to Mitch Daniels speech at CPAC. You'll need about 40 minutes if you choose to watch and listen. Daniels isn't an exciting guy, but here's hoping the country is ready for competence after seeing how stylish but empty rhetoric has failed.

Mitch Daniels: The Charisma of Competence 

Republicans and Farm Subsidies

The following article from National Review takes several Republican presidential wannabes to task, and rightfully so. Republicans should seriously consider moving the Iowa primary election to later in the year. Its present status at the beginning apparently makes otherwise fiscally conservative Republicans sing a different tune. I hope you will all forgive me for picking on conservatives.

Republicans are Weak on Farm Subsidies 

Economic Myths

The following article is a worthwhile read. Among the myths discussed is whether it would be catastrophic to not raise the debt ceiling in a couple of months.

Destructive Economic Myths 

Unintended Consequences

The following article from the American Thinker posits that U.S. policies may have had the unintended consequence of contributing to turmoil in the Mideast. I think he may have a point. Yet another reason to scrap ethanol.

America and the Middle East Food Riots

By Steve McCann

Perhaps the most overused but most accurate term used to describe the policies and ideology of the American left is the "Law of Unintended Consequences."  There is virtually nothing that these people espouse that, once put in place, has not had detrimental effects on either the people of the United States or the world. 

Today there is a global food shortage and skyrocketing prices.  This has become the underlying factor in the riots in Tunisia, Algeria, and Egypt, where up to 56% of a person's income is dedicated to the acquisition of food.  These riots are now leading to the upheaval of governments and the very real possibility of the ascendancy of the radical elements into control.

While bad weather in various parts of the world is an element of the accelerating food prices, there are two other factors directly related to the United States and its policies.

First, because of the enormous deficits run up by the Obama administration and the Democrat-controlled Congress, the Federal Reserve has had to effectively print trillions of dollars, which have flooded the global market.  Commodities are priced in dollars; consequently, emerging markets throughout the world, and the food sector in particular, are suffering from rapidly rising inflation.

The CRB food index is up an incredible 36% over last year.  Raw materials are up 23%.  Since 2009, the dollar has declined by over 13% against the Japanese yen and 25% against the Canadian dollar.

Larry Kudlow in the National Review writes in regard to the riots in Africa and the Middle East:

So I have to ask this tough question: Is Ben Bernanke's ultra-easy QE2 money-priming partially to blame.

But food riots in the North Africa/Middle East area are bumping smack into long-time resentment over autocratic government.  If food is in fact the trigger for what may be a revolution in Egypt, then US monetary policy has to shoulder at least some of the blame.

 

Crying Over Spilled Milk

I am not making this up.

In 1970, the Environmental Protection Agency adopted the Spill Prevention, Control and Countermeasure program, which was designed to prevent oil discharges in navigable waters or near shorelines. At the time, it was assumed that the program would deal with, well, oil.
That was then.

Now the EPA has finalized rules that subject dairy farmers to the program. Dairy farmers?, you ask. Yup. The agency has decided that since milk contains "a percentage of animal fat, which is a non-petroleum oil", then it must take steps to protect the public against the catastrophic consequences of spilled milk. The new regulations will force farmers to file "emergency management" plans to show how they will deal with spilled milk, how "first responders" will be trained, and build "containment facilities" in the event that milk spills.

These regulations will of course result in higher prices for milk, but I suppose the threat to the public of spilled milk is worth the cost.

In Obama's State of the Union address, he talked about getting rid of regulations that are "just plain dumb". This would be a good place to start.

Move to the Center, or a Head Fake?

Charles Krauthammer on Obama's State of the Union address...

I think he nails it.

The Old Obama in New Clothing

Genghis Khan: Environmentalist?

Who knew?

Will Al Gore now lead the environmentalist hordes to rape, pillage and plunder in the interest of stopping climate change?

Study: Genghis Khan's Mass Killings Cut Carbon Footprint 

U.S. - China Trade

The following article by Daniel Griswold of the Cato Institute makes an interesting point. In issues of trade with China, we are more likely to be collaborators than competitors. And the term "Made in China" can be a bit misleading. Our politicians should take note before they pontificate on matters about which they are clueless.

U.S. - China Trade a Collaborative Effort 

No Birth Certificate?

Recently the governor of Hawaii, Neil Abercrombie, made a big deal out of saying that he would produce Obama's long form birth certificate and put an end to all this nonsense about his eligibility to be president.

Then Abercrombie basically said oops, no can do, there are privacy laws that prevent me from producing it, sorry. Well, there may be more to the story...

Friend says Abercrombie told him "There's no birth certificate!" 

Rule by Bureaucrat, Part II

When the courts have told a government agency "you can't do that", and when a majority of Congress has asked that agency not to do "that", and when the American people don't want the agency to do "that", and the agency does "that" anyway, do we have a problem?

The "that" in question is the so-called "net neutrality" regulations being pursued by the FCC. In addition to flouting the courts, Congress and the American people, the FCC is angling to fix that which isn't broken. The FCC is in desperate need of being slapped down. Will anyone do it?

Net Neutrality is Theft

Villains Hall of Fame

In the Villains Hall of Fame, several notables come to mind...Beelzebub, Caligula, Vlad the Impaler, Napoleon, Hitler, Osama bin Laden, Al Gore.

We have a new inductee to the Hall. The 111th Congress.

According to Terence Jeffrey at CNS, the 111th added more to the national debt than the first 100 Congresses combined, $3.22 trillion. That's  $10,429.64 for every man, woman and child in the country. Total national debt is now $44,886.57 per person. Jeffrey gets his figures from the U.S. Treasury.

Happy New Year!

Kill Lame Ducks

Would someone please drive a stake through the heart of the 111th Congress and kill this evil creature?

In November, voters sent what should have been a loud and clear message to the current Congress...Stop it! Go away! We don't like you anymore!

Proving that this Congress couldn't care less what the country wants, it is giving the finger to voters. Rather than deal only with items that are absolutely essential (funding government or dealing with tax rates) or absolutely meaningless (name a bridge for somebody) during a lame duck session, this group of bloodsucking leeches is intent on ramming through as much of its agenda as possible in the next couple of weeks. Voters be damned. And country be damned.

A recent poll found that approval of Congress is at an all-time low--13%. I am astounded that it is that high.

The Mitch Daniels Dilemma

I wonder if Mitch Daniels is the kind of Republican that even those who don't care for the GOP could get behind should he decide to run in 2012...

 The Mitch Daniels Dilemma

Politics Without Labels

Politics without labels? What a silly idea.

U.S. Energy Independence

For years I have come across reports on the vast reserves of oil and natural gas available to us, should we decide to get it.  Now comes the United Nations with a report that predicts North America could be an exporter of reasonably cheap energy in the next decade or so.

Energy independence is apparently within our grasp. The problem, for some, is that independence, at least in the foreseeable future, will not come from wind, solar or biomass. Will environmentalists, warming fundamentalists and democrats be successful in their efforts to prevent energy independence? Will they succeed in preventing free markets from determining how our energy needs are met? Our future hangs on the answer to those questions.

U.S. on verge of energy independence without green fuels

The Rich Can Afford Tax Increases; Can We?

I read an article today which posed an interesting question regarding the current debate on tax increases: The rich can afford it; can we?

Think about it. Let's say I make $1 million a year. If the democrats have their way, my tax bill will go up next year. Or will it? I may very well go to my tax accountant and explore some tax avoidance strategies. If I'm an employer, I might decide that I can no longer hire the extra few employees I had planned to bring on. If I'm an investor, I might decide to move investments from one place to another to reduce my tax liability. But whatever I do, I will be able to afford the tax increase. I might forego the new Porsche or the Picasso, but I will still live well. No need to worry about me.

But what about the guy I might have hired who as a result of the tax increase won't get a job? What about the start up company I might have invested in that won't get off the ground? I can afford a tax increase. Can they?

Bill Gates and Warren Buffet both pontificate about how the wealthy should pay more in taxes, while they shield much of their income by setting up foundations. Nancy Pelosi and her philosophical soulmates preach that the rich should pay more, but I would bet my life that they all employ tax accountants to avoid paying taxes. Their hypocrisy sickens me. Their stupidity astounds me.

Some years ago, the Congress in its wisdom decided to stick it to the rich by enacting a luxury tax. Yachts, for example, were hit with an extra sales tax. From the progressive point of view, this was a great way to make the rich pay their fair share. One problem. The rich, as it turned out, could hold on to the yacht they already had. Or decide not to buy a yacht. Didn't hurt the rich at all. But companies that make yachts, and service yachts, and repair yachts, and the employees of those companies, all got clobbered.

No doubt about it. The rich can afford tax increases. Can we?

Farmer Fraud

The numbers below are estimates based on different sources, but I believe they are reasonably accurate.

In 1997, 400 black farmers filed a lawsuit against the U.S. Department of Agriculture (Pigford v Glickman), alleging they had been discriminated against in obtaining loans from USDA during the period from 1983-1997. In 1999, USDA settled the case, agreeing to pay each plaintiff $50,000. By then it had grown to a class action suit, and it was agreed that any black farmer who had so much as filed a complaint during the time frame would automatically be paid $50,000. They would not have to prove discrimination.. According to several sources, a total of something over 13,000 black farmers received this settlement. Beyond these, some 70,000 claims were denied because they were filed too late.

Now comes Pigford II, a new settlement announced last February by Attorney General Eric Holder and Agriculture Secretary Tom Vilsack, allowing those claimants who didn't get money the first time around to collect. Various estimates I've seen of new claimants range from 80,000-90,000. Combining the lower estimate with those who have already been paid, we will now have over 90,000 black farmers who end up with a nice check from the government.

So what, I hear some say. The government discriminated, it should pay. But there's a problem. According to the Bureau of Labor Statistics, in 1983 (the beginning of the time frame) there were only 19,000 black farmers/farm managers. It is unlikely that the number of black farmers increased in any year since then, given that ownership of farms by both blacks and whites have been declining for decades as big farms gobble up small ones. Even if one assumes that the number of black farmers increased by 10% per year, in order for these claims to be legitimate it would be necessary for every black farmer during the time period to have suffered discrimination at the hands of the USDA, and then some.

This stinks.