Refuting Buffet

Warren Buffet has become a darling of the left for his views that higher marginal tax rates are good policy. In a recent New York Times op-ed he claimed that higher rates would have no effect on investment. The article below strongly argues otherwise.


The Grumpy Economist: Buffet Math

Tax Cut Myth

While Obama has told the public repeatedly that the Bush tax cuts "got us into this mess", his own economists say otherwise. Question: is Obama unaware of this data, or is he simply a deliberate liar?

White House data debunk claim that Bush tax cuts caused deficit

Keep Your Powder Dry

Below are some headlines from the Drudge Report on shoppers' behavior on Black Friday. 

 

Now ask yourself: if people will act like this while trying to buy Christmas presents, what will they do in a crumbling economy when loaves of bread are scarce?

 

Gang fight at Black Friday sale...

 

Man punched in face pulls gun on line-cutting shopper...

Shots fired outside WalMart

Shoppers smash through door at Urban Outfitters

Customers run over in parking lot...

Fight breaks out over phones...

Shoplifter tries to mace security guards...

Mayhem at Nebraska mall where 9 murdered in 2007

Men steal boy's shopping bag outside Bed Bath & Beyond

A Recurring Theme

I recall back in 1992, when Clinton was running against Bush the elder, Slick Willie was claiming that the economy was "the worst it's been in 50 years". Must've been pretty bad. Except that it wasn't. The economy had come out of a brief recession and was growing at something like 4% when Clinton won. Of course, the media failed to report on it till after the election.

Then, in 2001, when Bush the younger took office, the media downplayed the fact of a recession that occurred under Clinton's watch had only just ended. Faced with a weak economy, Bush was able to push through the much-maligned tax cuts which, predictably, led to a stronger economy. Now those tax cuts are blamed by the current administration as "the old policies that got us into this mess". And most of the media dutifully and complicitly ignores the fact the federal housing policy is what got us into this mess, not tax cuts.

If exit data from the election is accurate, 53% of voters blame our current economy on Bush. They bought the false narrative peddled by Obama. But this con could not have worked without his media lap dogs.

My point here is that the ignorance of the American voter is willfully encouraged by a left wing media that takes orders from its liberal masters. The article linked below continues this theme. In just 10 days since the election, with Obama safely back in office, we are learning that, surprise!, the economy is actually worse than we were told.

Obama's Economy: What We've Learned Since Re-Election

Cartoon of the Day

Dodd-Frank: Worse than most people know

The following article on Dodd-Frank makes clear that the intent of the Act is the effective nationalization of the financial sector, just as the goal of Obamacare is the nationalization of health care. Unfortunately, I suspect that most voters think Dodd-Frank is merely designed to rein in those greedy bastards on Wall Street.

The Election & Dodd-Frank: This Act puts the entire U.S. financial system at the mercy of unelected regulators

Game Changer?

Turns out that diplomats in Libya made repeated requests for more security, and the administration turned them down. No wonder the administration has repeatedly lied about the attack on the consulate.

Maybe this will convince independents that Obama is in over his head...

Obama Administration Denied "Repeated Requests" for Increased Security in Benghazi

Health Care Costs

The data on the cost of Obamacare is coming in. It doesn't look good, although it was entirely predictable.

And it's going to get worse.

Another Broken Obama Promise: The Healthcare Cost Monster Emerges

Climate Realism

Following is a nice summation from a warming skeptic...

Climate Realism

 

Zero Tax Rate

Given the demagoguery from the left on the low effective tax rates paid by Romney, the following article is worth reading. Dan Mitchell argues that the tax rate on capital gains should be zero. I agree, but explaining the concept to those for whom class warfare is more important than good tax policy and economic growth will be a tough sell.

The Wall Street Journal's Primer on Capital Gains Taxation

We're No. 18!

 Those of us who believe that economic freedom is the key to prosperity will be dismayed, though probably not surprised, by the following:

U.S. Plummets to 18th in New Economic Freedom of the World Rankings

Trade

Regarding trade, Obama (and most other politicians) has it exactly backward.

Classic 1978 Milton Friedman Lecture on Trade

QE3

The Federal Reserve Bank announced a few days ago that it would begin implementing another round of pumping money into the economy, i.e. buying $40 billion of mortgage bonds per month till further notice. This is called Quantitative Easing, or QE. This particular round is called QE3, because the Fed has already tried QE1 and QE2. It's sort of like a doctor putting the paddles on a patient's chest and yelling "Clear!"

The implementation of QE3 suggests that QE1 and QE2 did not have the desired effect of pulling the economy out of the shitter. Isn't this an example of Einstein's dictum regarding insanity, i.e. repeating the same behavior and expecting a different result? Or is it simply an attempt by Fed Chairman Ben Bernanke to keep the economy on life support long enough to get Obama reelected?

Memo to Politicians: Stop Trying to Fix It

One of the reasons the economy is down the shitter is that government doesn't know when to leave things alone, and therefore repeats the same old mistakes. The usual cycle is as follows: 

 

1) Free (or relatively free) markets make a mistake, which happens from time to time.

 

2) Rather than let relatively free markets correct those mistakes and punish those who make them, which markets are uniquely qualified to do, politicians decide they must do something, presumably to justify their existence.

 

3) Politicians enact regulations which they claim will fix the problem that markets would have fixed anyway.

 

4) Politicians pat themselves on the back and tell voters they're looking out for the little guy.

 

5) Since regulatory bureaucrats are not smart enough to anticipate all the issues that may arise in a complex economy, and since regulations distort market signals, and since the regulated entities are usually pretty good at figuring out ways around the regulations, more problems arise.

 

6) Politicians then have to fix the problems that they essentially caused by not letting markets work in the first place.

 

7) Go back to step 1 and repeat.

 

 

The following is worth a read. Here's one nugget I especially like: "...capitalism without bankruptcy is like religion without hell."

 

Dodd-Frank: Pimps for Fannie and Freddie 

Doing Nothing

What if we had a recession and no one did anything?

Thomas Sowell: An Economic 'Plan'?

How Soon We Forget

What do you get when you combine 1) a willing accomplice to revisionist history in the form of the mainstream media, and 2) the incredibly short memory and ignorance of the American public? Answer: the surreal specter of Bill Clinton posing as an economic policy genius. And getting away with it. The fact is that Clinton was a major architect of the 2008 economic collapse.

Housing arsonist Clinton now portrayed as heroic firefighter.

More on GM

More on the democrats' claims about Obama saving GM...

Although not mentioned in the article below, a new report is out which concludes that GM is losing as much as $49,000 for every Chevy Volt it sells. Only a government-run business could think that such a business model is sustainable.

The Democrats' GM Fiction

Saving Detroit

We have heard a lot from democrats, especially during their convention, about how Obama saved the auto industry from bankruptcy, which the evil Romney would have allowed to happen. This story has become perhaps the central theme in the narrative about Obama's successful stewardship of the economy. But as the article below points out, Americans have a remarkably short memory. Chrysler and GM did in fact go through managed bankruptcies, as Romney suggested they should. The difference is that Obama wasted a lot of taxpayer money before it happened, and screwed secured bondholders in the process so he could help out the unions.

I pass this along in case one of your liberal friends tells you that Obama is the auto industry savior he claims to be.

Obama DID let Detroit go bankrupt.

Section 1504

While the country was sleeping, Section 1504 of Dodd-Frank has been put into effect. It will come as no surprise that Section 1504 is a lousy deal.

I would wager that if you asked every friend you have if they know about 1504, not one would have a clue. This is not an indictment of your friends, because most of mine wouldn't know, either. I didn't know about it till today.

My point is that there is so much going on that gets little attention that even those of us who follow these things have a hard time keeping up with how thoroughly we're being screwed. Yet most voters would doubtless consider themselves to be well informed.

Question:  If Obama was merely stupid, wouldn't the law of averages dictate that some of his decisions were in the best interests of the country?

Obama's Oil & Gas Folly

Not His Brother's Keeper

After lecturing us about being our brother's keeper, this is not a story Obama wants people to hear.


I hope the Romney campaign produces an ad with George Obama saying, "Barack, my brother, why won't you help my sick son? Please, I beg you. By the way, I found your birth certificate. Should I just stick it in the mail?"

How I became George Obama's "brother."