You Can Help Stop Ebola

I just emailed my two senators asking them to urge President Obama to stop all flights and all nationals from ebola-stricken countries from entering the United States. He already has the authority.  I am urging my readers to send similar messages to their Congressmen. Here's why: Immediately after the President assured us that our medical system was set up to handle any such cases, facts and events again proved him wrong (like with the IRS, ISIS, Fast and Furious, 'you can keep your doctor', open immigration of children, Benghazi, leaving a force in Iraq, etc., etc., etc.). The first case in Texas was completely mishandled by medical personnel, and the patient was sent home to infect hundreds of others. CDC leakers are also telling us that we cannot contain a major outbreak, and that almost no medical facilities even have the special haz-mat suits needed to handle such patients.

The argument is being made that no professionals will want to go into those West African countries to help them deal with ebola if they cannot get back out. This is a ridiculous argument. We can certainly track those individuals, and our military, who have already been committed to this fight, can certainly get them out.

Another scary thing is that some Central American countries from which all these thousands of illegals, mostly children, flooded our borders this summer have about the same conditions of sanitation in which dreadful diseases originate and spread – and our President invited them to come.

This is a time for action to protect America and for the lying and spinning to stop.

Best Editorial Ever

A long time ago, I got tired of “anti-Obama” all the time, even though I despise the man. I even stopped listening to Rush Limbaugh because of that. However, this anti-Obama editorial is well worth reading, and the voters who put him in office are going to have much to answer for.

At stake in Ukraine: 1914 with nukes

By Glen Meakem May 20, 2014 Providence Journal

Unrest continues to grow in Ukraine, particularly in light of this month’s vote by two eastern regions that overwhelmingly passed referendums in favor of self-rule.

Government buildings continue to fall to Russian nationalists and clashes between separatists and Ukrainian military forces are increasingly violent. Russia held a May Day parade in Moscow for the first time since 1991 — the final year of the Soviet Union. Over 100,000 Russians used the occasion to gather in Red Square and applaud the annexation of Crimea, Russian aggression in eastern Ukraine and Vladimir Putin’s expansionist policies.

European powers and the United States have done little to curb this new Russian aggression.

In 1994, U.S. President Bill Clinton, British Prime Minister John Major, Russian President Boris Yeltsin, and Ukrainian President Leonid Kuchma signed the Budapest memorandum, which pledged the nations to “respect the independence and sovereignty and the existing borders of Ukraine.” The treaty helped persuade Ukraine to relinquish its nuclear stockpile. At the time of the Soviet breakup, Ukraine had 1,800 nuclear weapons. In exchange for giving up their nukes, the U.S. pledged to secure Ukraine’s borders. In the years since, Ukraine has been a U.S. ally, even sending soldiers under NATO command in Iraq and Afghanistan.

But now, the fact that Vladimir Putin has grabbed Crimea and is infiltrating eastern Ukraine begs two questions. First, do treaties signed and commitments made by the U.S. mean anything? Second, if they don’t, what does this mean for the rest of the world?

By abandoning our security arrangement with Ukraine, we are creating a huge incentive for countries around the world to stockpile nuclear weapons, thus increasing the probability of nuclear conflict somewhere.

One hundred years ago, no one thought war was imminent. As Newt Gingrich writes at CNN.com, World War I “came as an enormous shock, in retrospect almost like the Titanic hitting an iceberg. In the end, it shattered Europe, cost tens of millions of lives, bankrupted countries and changed forever those who survived the horrors.”

One hundred years later, an aggressive Russia possesses thousands of nuclear weapons and is motivated by a renewed imperialism that threatens peace in Eastern Europe.

So why is Russia acting with such overt aggression? Under President Obama, we have been in retreat from the world. His policies have included a quick withdrawal from Iraq and an unwise draw-down of forces in Afghanistan. He is shrinking our Navy — we currently have fewer than 100 ships deployed. He is shrinking our Army to its smallest size since before World War II. Obama has let foes cross red lines in Syria and kill our U.S. ambassador to Libya — both with no apparent consequences. And, in addition to reneging on our security agreement with Ukraine, he has reneged on our agreement to deploy missile defenses in Poland and the Czech Republic.

If Americans choose to continue down Obama’s path of weakness and retreat, we must accept an increasingly dangerous and unstable world. Just look at the growing dangers in Syria, Libya, Iran, Yemen, the Baltic States and the South China Sea, to name just a few.

But, this is not the world of 1914. It is the world of 2014 and the nuclear bazaar is just beginning for many smaller, increasingly insecure nations, from Saudi Arabia to the Philippines. And don’t forget the growing Islamic terror organizations that are just dying to get their hands on some nukes. In Obama’s world, any number of security lapses or miscalculations could lead to devastating nuclear conflicts — nuclear 1914.

Americans can still decide to lead and live up to the responsibility of being the global superpower. We can embrace our heritage and history as the country that saved the world from German expansionism in World War I, Nazism and the Imperial Japanese in World War II, and the Soviet Empire during the Cold War. We can be the steady, powerful, good actor that makes smaller allies feel secure and keeps potential enemies in check.

But if we want to have a strong military, we can’t continue to let spending mushroom with tens of millions of working-age Americans living lives of dependence on welfare, Obamacare, disability and a myriad of other taxpayer-funded programs. We must stand up to our growing entitlement culture. For America to be strong and the world to be safe, the vast, vast majority of individual Americans must choose to work hard and not be dependent.

Glen Meakem is the founder and CEO of Forever.com and was previously founder and CEO of FreeMarkets. A former Army Reserve officer, he is a veteran of the Gulf War and a graduate of both Harvard College and Harvard Business School.

What Others Must Feel

Imagine if you were an Egyptian, or a Greek, Italian, Spaniard, Turk, or a citizen of many other formerly powerful countries, what it must feel like to look back on your history of when your country was foremost in the world.  At one time your country was the most powerful and most prosperous country in the world.  Today, your country is but a shadow of what it once was.

Today I watched a PBS program that presented the history of American aviation, and the exploits of men like Donald Douglas and Jimmy Doolittle.  The program concentrated on the miraculous industrial production of American war planes during World War II, the incredible Doolittle raid on Japan at a time when the Pacific was a Japanese lake, and the decisive, but improbable, victory at Midway.

We still have men (and women) of such courage and determination, but my reaction this time when watching this history lesson was one of sadness.  For the first time in my life I felt I was feeling the emotions of those Egyptians, etc. who look back on the greatness of what was – and on the reduced state of their country today.

Obama has divided and weakened us as never before in our history since the Civil War.  He has throttled our economic recovery with regulations and Obamacare.  We have become a laughing stock in the capitals of Europe and a toothless scold in the Middle East.  He has us arguing about who should pay for cheap contraceptives, and his minions are engaged in a campaign to dehumanize those who disagree with his radical agenda.

I am deeply saddened about the state of my country and its fall from greatness.  It wasn’t conservatives who destroyed our education system, it was liberal ideas and agendas; it wasn’t conservatives who destroyed our great cities, it was liberal ideas and agendas; it wasn’t conservatives who created many millions of single mothers and feckless, fatherless children, it was liberal ideas and agendas; and it wasn’t conservatives who polluted our culture, it was liberal ideas and agendas.

Last Blog Post

This blog started out as a letter to my grandchildren, and it will end on the same note.  My original letter nine years ago came about as a reaction to the nonsense I heard some of them say at the dinner table – nonsense put there by leftist teachers who hate this country because of their own guilt and lack of understanding of history and human nature.

In order to write a meaningful blog post, one has to keep up with world and national events reported on the news, but the news is so dismaying and disgusting lately that I can’t stand to hear it any more.  Everything seems to be coming apart for Americans: our leadership in the world is over, our economy is in permanent recession, any respect and fear of us held by jihadist Muslims is gone, the greatest healthcare system in the world is being systematically destroyed (including doctors abandoning Medicare because of payment cuts as funds are shifted to pay for Obamacare), all the progress made in race relations is disappearing as Obama cleverly uses symbolism to urge blacks to hate whites (and poor people to hate rich people).

Women are being told that Republicans want to kill them, churches are being told that they cannot practice their religion (abortion and contraception), employees of Homeland Security are being told that Americans who love liberty and states rights are more dangerous than militant Muslims, citizens are being fed the nonsense that an Army officer with jihadist ties who shouts Allahu Akbar while slaughtering 13 soldiers is not a terrorist, and that al-Qaeda has been squashed.

I haven’t even mentioned the so-called, “phony” scandals such as Fast and Furious, Benghazi, the IRS corruption of the 2012 election, the harassment of FoxNews reporters, the backing of the Muslim Brotherhood in Egypt – or the knowledge that just about everything that comes out of the mouths of liberal politicians and operatives is a lie.

I can’t stand it anymore.

 

TO MY GRANDCHILDREN (6/2004)
 

To someone my age, grandchildren are terribly important because they represent the future. I’m writing this because I want to make sure that my grandchildren understand some things that will be very important to their future — and to their childrens’ future.

Any American who studies history — whether ancient history or recent history — should realize two major lessons from history: Lesson l. You and I and the ordinary working person in this country have a quality of life that in most of the world has been available only to a very few, extremely wealthy persons of royalty. Of the billions of people born since the world began, almost everyone has lived wretched, short lives of incredible poverty and despair. This widespread quality of life you and I have is of recent origin and came about because of the unique qualities of American civilization —freedom, capitalism and inventiveness.  Lesson 2. Every great civilization — the Egyptians, the Greeks, the Romans, the Spaniards, the Turks and others — every one of them has eventually disintegrated or disappeared. Today we live during the great American civilization. Will it also disappear?

Sometimes great civilizations ended because of military defeats, but more often, they ended because of intemal decay. You might say that they committed suicide. During your lifetime you will encounter many people who are mentally sick in some way. Some are criminals who will hurt you if you let them. It’s pretty easy to stay out of their way. But some are sick in more subtle and devious ways. They don’t understand history. They don’t understand that American freedoms and American traditions and the

bloodshed of American patriots not only provided the wonderful life we have — but has offered hope to all the rest of the world. These people are Americans, but, inexplicably, they hate America.

Yes we have made mistakes, and sometimes we have been forced to choose the lesser of two evils, but unlike every other civilization, America has always tried to help. After we won World War II, the most terrible war in history, we offered a hand of friendship to our enemies. Instead of

ransacking their countries, as all previous victors throughout history had done, we helped them to rebuild and taught them how to live in freedom.

However, these people who have this kind of mental illness don’t see this; they only see the mistakes we have made. They are like some people who, if you give them a rose, will only see the thorns. The problem is, these

Americans with this kind of mental illness, may be the ones who destroy our civilization — if we let them.

Who are these people? Back in the l97O’s a Senator, Senator Church, who headed an important committee and who for some reason hated the CIA so much he not only persuaded the Congress to weaken the CIA (possibly

why the 9/11 attacks succeeded), but he published the names and addresses of CIA agents around the world. This is very personal for me because a near classmate at my high school in Providence, RI, the CIA Station Chief in Athens, Greece, Richard Welch, was murdered shortly thereafter on the front steps of his home. Also during the 1970’s a man named Daniel Ellsbergh stole and published military secrets that undermined public confidence in our military at a time when American service men and women were under fire.

During Desert Storm in the l990’s two CNN TV broadcasters, Peter Arnett and Bernard Shaw, actually broadcasted from Baghdad while our men and women risked their lives. Their television programs gave information to the Iraqis and could have cost American lives. We also have many people in our country who seem willing to undermine our society in order to make money or to further some agenda that may arise out of their form of sickness. We have movie, television, radio and music producers who constantly try to expose young people to more and more violence and near-pornography in order to increase the shock value of their products and make more money for themselves.

If this wasn’t bad enough, at least it is understandable. What is not understandable is the number of people who actually believe that it’s good for us to see and hear this filth.

For all its faults, the United States of America has been and remains the source of hope and progress to the peoples of the world. We were one of the first countries to outlaw the slave trade (slavery still goes on today in some countries), and we are the first country to go to the aid of countries that suffer disasters. We are the only country in the world where millions of people (remember little Elian Gonzalez) risk their lives every year to try to get here to live.

Since evil thrives when good people do nothing, it is up to the rest of us to fight against all these sick people. I hope I’ve tried during my lifetime, and I hope you will too.

Love, Grandpa Wilcox

 

Is Obama the worst president ever?
 

By HUGH HEWITT | AUGUST 25, 2013  Washington Examiner

President Obama's promises on Obamacare have turned sour as implementation draws closer.

 (AP... "If you like your health care plan, you can keep your health care plan." — President Obama, Aug. 11, 2009)

So said President Obama again and again through 2009 and 2010 as he sold Obamacare to the country. He promised. He put his personal integrity on the line. His word.

How many UPS employees voted for the president in 2008 and again in 2012? Because on Friday, UPS announced it was dumping 15,000 spouses of UPS employees from their UPS health plans despite the president's many, many promises to the contrary.

The UPS spouse-dump followed by a few days the news from New Jersey that Obamacare's rollout there will end the low-cost, high-deductible plan that more than 106,000 Jersey folks liked and which presumably many of them would have preferred to keep.

Oh, and the cost of individual plans are set to rise on average 41 percent in Ohio, and another major insurance company, Anthem Blue Cross, has pulled out of the California market for small businesses.

Let a thousand stink bombs go kaboom. Obamacare is the train wreck that just keeps arriving on an ever-more prolonged schedule.

Most Mainstream Media refuse to catalogue the consequences of the epic bill that went unread when it was passed without a single Republican vote in 2009. Most journalists just avert their eyes.

But now that that the bodies of hundreds of gassed Syrian children are piling up in Damascus and scores of Christian churches are burned-out shells in Egypt, it is getting harder and harder to find anything to write about the president that doesn't underscore his incompetence.

Obama's tenure is a vast desert of anti-achievement, a landscape of waste and ruin on every front at home and abroad, save on the ability to mobilize voters who don't know or don't care about the state of the country or the world.

The president rolled to re-election on the strength of technologies that enabled his minions to tap and turn out folks who simply are clueless that that nice fellow in the White House hasn't the foggiest idea of how to run the country.

Perhaps by the time you read this, the president will have ordered a few cruise missiles to fall on Damascus, and the anti-Sisi rhetoric will have been toned down in recognition that the general running Egypt is likely to be there far longer than the president is living at 1600 Pennsylvania Avenue.

But the prospect of 39 more months of the anti-president at the helm is daunting. No plans for anything except bus tours and college campus speeches, no idea how to invigorate a sputtering economy or trim a bloated budget.

Just miles and miles to go before we can can all sleep without the prospect of seeing him the next day, yet again, making another meaningless speech or filibustering another softball question from a kept White House press.

Many will argue that Stanley Baldwin was the worst of the modern British Prime Ministers, though a few remonstrate half-heartedly for Edward Heath, but Heath did not leave his country vulnerable to war and direct attack that killed hundreds of thousands.

Since 1979 and the acquiescence of the transfer of Iran to religious zealots with world-enders and Hidden Imam-summoners among them, I didn't think it was possible for an American president to be ranked below Jimmy Carter on the competence list.

But now we have Obama, with double the years that Carter had to more than double the wreckage of the Carter era. Obama is working on his place in history every day, and every day he is making that ranking more secure.

 

 

 

 

 

 

 

 

Don't Let Ideology Blind You

Left-click to enlarge

One feature that jumps out at you is how relatively flat mean income has been for the bottom 80% over the last 45 years and how much it has grown for the top 20%, from an already high baseline.  From 2011 census data.

Left-click to enlarge

Top 1% paid less taxes than lower group

Some people have their facts wrong, while others have no facts. Due to my call for the Republican Party to support higher income, investment and estate taxes on the very wealthy and the upper 20% of income earners, I am getting many angry (and often obscene) e-mails from people who just don’t get it. They complain that I have turned Marxist; they complain about the so-called 47% who pay no income taxes; they complain that you have to cut taxes to promote growth.

Here is what they don’t understand:

1. income tax rates have been cut drastically since 1981 when the top rate was 70%; it is now 35%
2. the 47% pay no taxes due mostly to low taxable income and to changes made in tax law by both Democrat and Republican administrations
3. most voters understand that income and wealth distributions have become obscenely skewed over the past few years.
4. if Republicans don’t lead the way in effecting changes in wealth and income distributions, the election of 2012 will look like a picnic
5. the current wealth and income distributions may even become dangerous to a civil society
6. cutting taxes to promote growth works when taxes are too high and in normal times; largely due to the housing crash, these are not normal times, and tax rates are way down.

We may despise President Obama’s class warfare and hateful, insulting language, but he is basically right about needed tax increases. Of course, at the same time, we need to press him for meaningful spending cuts.

From Bloomberg:

“The Republican presidential candidate’s comments that 47 percent of Americans don’t pay income taxes and see themselves as “victims” dependent on the government signifies a shift in the party’s thinking. Republicans backed refundable tax credits and expanded entitlement programs under George W. Bush. Now they want to curtail entitlements and express concern that not enough people are paying taxes.

“The working people who don’t pay income tax, that is by and large the result of Republican policies,” said Michael Linden, director of tax and budget policy at the Center for American Progress, a Washington group aligned with Democrats. He said he didn’t “understand why they’re not trumpeting this.”

From Factcheck.org:

“Romney is a bit out of date with his claim that 47 percent of Americans pay no federal income tax. That was true in 2009, but the number is lower now, and falling as the economy improves and more people are working and getting paychecks.

Figures come from the nonpartisan Tax Policy Center, and its most recent analysis in July 2011 put the figure for that year at 46.4 percent. That comes to about 76 million individuals or families who paid no federal income taxes in 2011. TPC projected that the percentage would fall to 46 percent this year, and to 44 percent in 2013, under current tax policies.

Let’s take a closer look at the 46.4 percenters.

According to the Tax Policy Center, about half of those who owe no federal income tax are people whose incomes are so low that when standard income tax provisions — personal exemptions for taxpayers and dependents and the standard deduction — are factored in, that simply leaves no income to be taxed. Those are people who earned less than about $27,000.

But that doesn’t mean those folks paid no taxes at all. Many of them paid payroll taxes, those taxes taken out of a paycheck by an employer to fund programs such as Social Security and Medicare. They also pay federal excise taxes, such as those on gasoline, and they may also pay state and local income taxes or property taxes.

So that’s half of Romney’s 46.4 percenters. The rest pay no federal income tax due to tax benefits and credits. Here’s the rest of the breakdown:

 22 percent receive senior tax benefits — the extra standard deduction for seniors, the exclusion of a portion of Social Security benefits, and the credit for seniors. Most of them are older people on Social Security whose adjusted gross income is less than $25,000.

 15.2 percent receive tax credits for children and the working poor. That includes the child tax credit and the earned income tax credit. The child tax credit was enacted under Democratic President Bill Clinton, but it doubled under Republican President George W. Bush. The earned income tax credit was enacted under Republican President Gerald Ford, and was expanded under presidents of both parties. Republican President Ronald Reagan once praised it as “one of the best antipoverty programs this country’s ever seen.” As a result of various tax expenditures, about two thirds of households with children making between $40,000 and $50,000 owed no federal income taxes.

 The rest ended up owing no federal income tax due to various tax expenditures such as education credits, itemized deductions or reduced rates on capital gains and dividends. Most of this group are in the middle to upper income brackets. In fact, the TPC estimates there are about 7,000 families and individuals who earn $1 million a year or more and still pay no federal income tax.”

This Is Really Serious

It appears that others, including conservatives like me, have also noted the appalling statistics on income and wealth distribution in our country over recent years – one explanation for Obama’s win. The reasons seem to have to do with globalization, lower income and investment tax rates, and the huge decline in private sector unions. Our middle class, the bedrock of a stable society, is disappearing.  The two recent articles below affirm what I have been saying:

Net worth of American households at 43-year old low

Rick Moran December 2, 2012 American Thinker (excerpt)

“Yes, but we've got 4 more years to get it right...or something.

The median net worth of American households has dropped to a 43-year low as the lower and middle classes appear poorer and less stable than they have been since 1969.

According to a recent study by New York University economics professor Edward N. Wolff, median net worth is at the decades-low figure of $57,000 (in 2010 dollars). And as the numbers in his study reflect, the situation only appears worse when all the statistics are taken as a whole.

According to Wolff, between 1983 and 2010, the percentage of households with less than $10,000 in assets (using constant 1995 dollars) rose from 29.7 percent to 37.1 percent. The "less than $10,000″ figure includes the numerous households that have no assets at all, or "negative assets," which is otherwise known as "debt."

Over that same period of time, the wealthiest 1 percent of American households increased their average wealth by 71 percent.” American Thinker

Last week the House passed a bill making it easier for high-skilled workers to become legal immigrants.  The following article explains why this is important:

Why Conservatives Must Surrender on 'Redistribution'

By Josh Barro - Nov 29, 2012 Bloomberg

Liberals talk about booming incomes at the top while lower-income households barely see benefits from economic growth. Conservatives talk about a rising share of the population that depends on government benefits and a shrinking share that pays income tax.

Though the frames are different, these are descriptions of the same economic phenomenon: rising inequality of pre-tax incomes. But only liberals are advancing a semblance of an agenda to address it.

The main liberal reaction to this phenomenon is to call for more progressive fiscal policy: higher taxes on the rich people who have benefited most from the last 30 years' gains in gross domestic product to pay for programs that raise low- and middle-income people's after-tax incomes. Obamacare, which raised taxes on the rich to fund a new health-care entitlement for the poor and middle class, is a key example of this agenda.

Liberals also advocate policies that are aimed at reducing pre-tax inequality: more subsidies for education, trade protection, industrial policy to support medium-skill jobs in manufacturing, easier unionization, minimum-wage increases, rent control.

All of these policies have a trade-off: in exchange for reducing income inequality, they are likely to reduce GDP growth. But some are better than others. Minimum-wage increases in the range being discussed in today's political debates don't seem to have significant negative impacts on employment or output. There is room for a significant increase in tax progressivity without (much of) a negative impact on GDP growth, especially if the reform is well-designed.

But the key problem in this debate isn't that liberals' ideas are bad, though many of them (especially on trade) are. It's that conservatives have no serious proposals of their own on rising inequality.

One conservative message on inequality is to say that it doesn't matter, and we should accept rises in both pre-tax and post-tax inequality. This is the implication of studies periodically put out by the Heritage Foundation, arguing that poor people aren't really poor if they have microwave ovens.

This isn't an appealing argument. The problem with rising inequality is not that lower-income families can't afford ever-cheaper electronics; it's that they can't keep pace with the rising costs of health care, education and (in certain parts of the country) housing. There's also no reason to think that, whatever standard of living we start from, an economy where nearly all the improvements accrue to a small fraction of families is either politically sustainable or morally acceptable.

Then there is the argument that government benefits reduce the productivity of people at the bottom, who would go out and earn more money if we made their entitlements less generous. When Mitt Romney says this he ends up more or less calling the bottom half of the income distribution moochers; people such as Paul Ryan manage to say the same thing more artfully.

The main problem with this position is the lack of evidence to support it: Lower taxes and a smaller government might raise GDP growth, but there's no particular reason to assume that growth would accrue in a more equal manner than we have experienced recently. The main effect of Ryan-style fiscal policy, which makes taxes both lower and less progressive and while shrinking benefits, would be a rise in after-tax inequality.

This is an example of what I said two weeks ago: Conservatives do not have economic ideas that are good for the middle class. Since the 1970s, wage gains have decoupled from productivity gains and the median family has therefore reaped a disproportionately small share of the benefits of growth. Conservatives are left without anything to say about this problem.

What can they say about it? I have a few ideas, though I don't think conservatives are likely to like any of them too much.

One, as I discuss at greater length here, is that they can take up the cause of cost control in health care and higher education, the effect of which would be to raise real incomes for the middle class. The rising cost of health benefits has been a key driver of middle-class wage stagnation. Unfortunately, many of the policies actually likely to control costs in these sectors are interventionist in a way that makes conservatives recoil.

Another possibility is greater high-skill immigration. Globalization has been disproportionately beneficial to high-skill workers in developed nations: they have seen the prices of products fall as manufacturing shifts to low-wage countries, but their own jobs are insulated from foreign competition. Letting in more foreign doctors and engineers should drive down wages in skilled professions and the cost of the services those professionals provide, raising real incomes for lower-income workers who already face wage competition from other countries. Reducing occupational licensing requirements would similarly raise real incomes.

But the big problem for conservatives is that these policies cannot fully substitute for progressive fiscal policy. The dirty secret about the last 30 years' rise in pre-tax income inequality is that we probably can't reverse it. Instead, we will have to rely on policies that ameliorate it on an after-tax basis -- that is, the dreaded redistribution of income, or "spreading the wealth around."

Some redistributive policies are more economically damaging than others. If conservatives made peace with the need for more redistributive economic policy, they could fight to make sure it is pro-growth. For example, they could focus on minimizing poverty traps created by means-tested entitlements, and making sure the tax base is broad so progressivity can be achieved with relatively low tax rates.

Roughly, this is what right-of-center political parties in Europe do.

Obviously, it's not something conservatives in the U.S. are interested in doing. Instead of trying to make Obamacare less costly and less economically distorting, conservatives fought as hard as they could to stop it, rejecting the whole idea of a more progressive fiscal policy. (If you think conservatives' objection is to spending rather than spending specifically on poor people, note how protective Republicans are of Medicare, a relatively non-progressive entitlement program.)

And they lost, because the rise in pre-tax inequality (and the related rise in health care costs) is making the electorate's demand for progressive fiscal policy stronger and stronger.

Eventually, if conservatives want to keep putting their stamp on American economic policy, they will have to give in to that reality that government must become more redistributive. Otherwise, the Republican Party will be left with an economic appeal to an affluent minority of the population and an ethnic appeal to a shrinking older white-voter base -- and that will win them fewer and fewer elections.

The Tide May Be Turning (Slightly)

Two weeks ago I wrote an article saying that Obama won re-election primarily because people are hurting much more than Republican politicians realize -  from the effects of the housing crash and from the incredible and dangerously unfair distributions of wealth and income now taking place in America. Obama won because he articulated this unfairness while leading Republicans kept saying that they will never raise taxes on the wealthy, and Mitt Romney never came to grips with the issue.

When 1% of our population has 37% of America’s private wealth, while 40% of the population has only 3/10 of 1% of the wealth, something is very wrong – even to a conservative Republican like me. To his discredit, President Obama never explained the situation, never worked to change it, and instead used class warfare to batter Republicans.

All of a sudden, due to the fiscal cliff that faces us, some Republicans, at least 16, are indicating a willingness to raise income tax rates on wealthier Americans, not because of the unfairness issue, but because of the deficit and the need to make some compromises to get Obama to agree to some spending cuts. There are two dangers facing Republicans: 1. one is that the cuts will be future cuts that, as usual, will never materialize, and 2. recent polls indicate that Republicans will be blamed if a real bargain is not reached. As discussed here, rates on higher incomes need considerable upwards adjustments. This has nothing to do with the needs of the federal budget, but obviously will help in the efforts to balance it.

I’ve gotten some angry e-mails from readers who tend to be conservatives since my posts are usually very conservative in nature. These readers are of two schools: 1. that what I am saying is socialism, or 2. that raising rates on earned and investment incomes will cause an economic slowdown since lowering rates has often caused an upturn.

As to point 1. my answer is that when something is wrong, it should be corrected, and I don’t care what it is called. On point 2., unless rates are increased to levels in effect from 1932 to 1981, I don’t believe raising them will have much effect on economic activity.

History of income tax rates adjusted for inflation
---------Top ----- Top -------- In 2011
Year -- Rate --- Bracket ----  Dollars -- Comment
1913 --- 7% ---- $500,000 -- $11.3M First income tax

1917 -- 67% -- $2,000,000 -- $35M World War I financing

1925 -- 25% ---- $100,000 -- $1.28M Post war reductions

1932 -- 63% -- $1,000,000 -- $16.4M Depression era

1936 -- 79% -- $5,000,000 -- $80.7M

1941 -- 81% -- $5,000,000 -- $76.3M World War II

1942 -- 88% ---- $200,000 --- $2.75M Revenue Act of 1942

1944 -- 94% ---- $200,000 --- $2.54M Tax Act of 1944

1946 -- 91% ---- $200,000 --- $2.30M

1964 -- 77% ---- $400,000 --- $2.85M

1965 -- 70% ---- $200,000 --- $1.42M

1981 -- 70% ---- $212,000 ---- $532k Reagan tax cuts

1982 -- 50% ---- $106,000 ---- $199k Reagan tax cuts

1987 -- 38.5% -- $90,000 ----- $178k Reagan tax cuts

1988 -- 28% ---- $29,750 ----- $56k Reagan tax cuts

1991 -- 31% ---- $82,150 ---- $135k

1993 -- 39.6% - $250,000 --- $388k
2003 -- 35% ---- $311,950 --- $380k Bush tax cuts

2011 -- 35% ---- $379,150 --- $379k

I Was Wrong and Why

The corrupt, mainstream press and a rotting, anything-goes-if-it- feels-good population combined to re-elect a failed president. Life, liberty and the pursuit of happiness isn’t good enough anymore. Now it’s free food, free condoms, tax-payer funded abortions, and the continued elevation of Muslims, here, and around the world. Someone once said that the way to get out of the mess in Vietnam was to declare victory and get out. That has been our policy toward Islamic terrorists for the last four years – pretend they don’t exist anymore.

I guess we can’t count on the Hand of God anymore; maybe He can only help so much (or maybe He can only TAKE so much).

My sister, who needs my continuing financial support, voted for Obama. When I questioned her, she knew nothing about Benghazi and hadn’t heard of Fast and Furious, Solyndra, the planned destruction of Medicare or the regulation forcing Catholics to pay for abortion insurance. The next time she needs help maybe I should tell her to ask Obama (I won’t; I’m a Christian, and she’s family.)

I am serious, though, about my need to conserve my savings for when all the good doctors abandon Medicare, and the Chinese stop financing our Social Security.

The policy of denying the existence of Islamic terrorists has forced the families of the Fort Hood massacre victims to take legal action.

Fort Hood shooting victims sue government, accused shooter

By Jim Forsyth Mon, Nov 5 2012 Reuters

SAN ANTONIO (Reuters) - Families and victims of a mass shooting in 2009 at the Fort Hood military base in Texas filed a wrongful death suit on Monday against the U.S. government, the accused gunman and the estate of an alleged al Qaeda leader.

The 148 plaintiffs are seeking damages and a ruling that the rampage was a terrorist attack. The finding would clear the way for them to receive benefits.

Major Nidal Hasan, an Army psychiatrist, faces 13 charges of premeditated murder and 32 counts of attempted premeditated murder for the November 5, 2009, attack on soldiers preparing to deploy to Iraq.

Survivors have expressed frustration about repeated delays over the past three years in bringing Hasan to trial. The U.S. Court of Appeals for the Armed Forces indefinitely postponed Hasan's court-martial last month pending further review.

The suit filed in U.S. District Court in the District of Columbia alleges that Defense Secretary Leon Panetta and other officials disregarded the safety of soldiers and civilians at Fort Hood. It also alleges that they allowed Hasan to be in a position to open fire on the troops despite knowing he was a "radical extremist."

"The government seems to have gone out of its way to give the stiff arm to these victims. They have made their lives miserable," said attorney Neal Shur, who is the lead counsel in the case.

The lead plaintiff is Shawn Manning, who was an Army staff sergeant three years ago and was shot six times.

"The Army has refused to acknowledge this was a terrorist attack, and I have exhausted all other options," he said.

The other defendants include Hasan, who was shot by police during the attack and paralyzed from the chest down, and the estate of Anwar al-Awlaki, a U.S.-born cleric linked to al Qaeda's Yemen-based wing. He was killed in a U.S. drone strike last year.

An independent review headed by former FBI Director William Webster found that Hasan had exchanged emails with Awlaki.

The lawsuit includes allegations of civil conspiracy, gross negligence, assault and battery, due process violations and intentional misrepresentations.

Shur said one reason the suit was filed was that federal authorities had "ignored" $750 million in administrative claims he sought in 2011.

Wisconsin Redux

Living most of my life in the state of Rhode Island has given me a certain perspective. The state exists in an unholy alliance of public service unions who put politicians in office with their dues money and their organizing efforts – and then show up to claim more goodies from these same politicians who owe them their own jobs.

As a result Rhode Island is teetering on the edge of bankruptcy, one city is in bankruptcy, and the capitol city and at least two others are about a year away. Rhode Island’s infrastructure is crumbling, young people are fleeing the state, and the official unemployment rate is 11.1% (the unofficial rate is closer to 20%).

Teachers are forbidden to strike in RI, but they do almost every year with no discernable consequences except that they win new and better contracts. I have never understood why any public service worker should have the right to strike without serious consequences. They have job security and pensions that are unknown in the private sector, and going on strike against their taxpayer employer seems obscene.

Of course, the major aspect of the victory that Governor Walker won is in stopping the forced collection of union dues by the government.  Once that happened, union membership in the largest state workers' union fell by 50%.   It was predictable. In Indiana, where Gov. Mitch Daniels (R) instituted by executive order a similar reform seven years ago, government-worker unions have since lost 91 percent of their dues-paying membership. 

I hope and pray that the courageous work that Governor Walker has done in Wisconsin will encourage enough other governors to bite the bullet and get a movement rolling that will save us all from bankrupting the system everywhere.

What's Changed After Wisconsin

The Obama administration suddenly looks like a house of cards.

By PEGGY NOONAN June 7, 2012 Wall St Journal

Wisconsin signals a shift in political mood and assumption. Public employee unions were beaten back and defeated in a state with a long progressive tradition. The unions and their allies put everything they had into "one of their most aggressive grass-roots campaigns ever," as the Washington Post's Paul Whoriskey and Dan Balz reported in a day-after piece. Fifty thousand volunteers made phone calls and knocked on 1.4 million doors to get out the vote against Gov. Scott Walker. Mr. Walker's supporters, less deeply organized on the ground, had a considerable advantage in money.

But organization and money aren't the headline. The shift in mood and assumption is. The vote was a blow to the power and prestige not only of the unions but of the blue-state budgetary model, which for two generations has been: Public-employee unions with their manpower, money and clout, get what they want. If you move against them, you will be crushed.

Mr. Walker was not crushed. He was buoyed, winning by a solid seven points in a high-turnout race.

Governors and local leaders will now have help in controlling budgets. Down the road there will be fewer contracts in which you work for, say, 23 years for a city, then retire with full salary and free health care for the rest of your life—paid for by taxpayers who cannot afford such plans for themselves, and who sometimes have no pension at all. The big meaning of Wisconsin is that a public injustice is in the process of being righted because a public mood is changing.

Political professionals now lay down lines even before a story happens. They used to wait to do the honest, desperate, last-minute spin of yesteryear. Now it's strategized in advance, which makes things tidier but less raggedly fun. The line laid down by the Democrats weeks before the vote was that it's all about money: The Walker forces outspent the unions so they won, end of story.

Money is important, as all but children know. But the line wasn't very flattering to Wisconsin's voters, implying that they were automatons drooling in front of the TV waiting to be told who to back. It was also demonstrably incorrect. Most voters, according to surveys, had made up their minds well before the heavy spending of the closing weeks.

Mr. Walker didn't win because of his charm—he's not charming. It wasn't because he is compelling on the campaign trail—he's not, especially. Even his victory speech on that epic night was, except for its opening sentence—"First of all, I want to thank God for his abundant grace," which, amazingly enough, seemed to be wholly sincere—meandering, unable to name and put forward what had really happened.

But on the big question—getting control of the budget by taking actions resisted by public unions—he was essentially right, and he won.

By the way, the single most interesting number in the whole race was 28,785. That is how many dues-paying members of the American Federation of State, County and Municiple Employees were left in Wisconsin after Mr. Walker allowed them to choose whether union dues would be taken from their paychecks each week. Before that, Afscme had 62,218 dues-paying members in Wisconsin. There is a degree to which public union involvement is, simply, coerced.

People wonder about the implications for the presidential election. They'll wonder for five months, and then they'll know.

President Obama's problem now isn't what Wisconsin did, it's how he looks each day—careening around, always in flight, a superfluous figure. No one even looks to him for leadership now. He doesn't go to Wisconsin, where the fight is. He goes to Sarah Jessica Parker's place, where the money is.

There is, now, a house-of-cards feel about this administration.

It became apparent some weeks ago when the president talked on the stump—where else?—about an essay by a fellow who said spending growth is actually lower than that of previous presidents. This was startling to a lot of people, who looked into it and found the man had left out most spending from 2009, the first year of Mr. Obama's presidency. People sneered: The president was deliberately using a misleading argument to paint a false picture! But you know, why would he go out there waving an article that could immediately be debunked? Maybe because he thought it was true. That's more alarming, isn't it, the idea that he knows so little about the effects of his own economic program that he thinks he really is a low spender.

For more than a month, his people have been laying down the line that America was just about to enter full economic recovery when the European meltdown stopped it. (I guess the slowdown in China didn't poll well.) You'll be hearing more of this—we almost had it, and then Spain, or Italy, messed everything up. What's bothersome is not that it's just a line, but that the White House sees its central economic contribution now as the making up of lines.

Any president will, in a presidential election year, be political. But there is a startling sense with Mr. Obama that that's all he is now, that he and his people are all politics, all the time, undeviatingly, on every issue. He isn't even trying to lead, he's just trying to win.

Most ominously, there are the national-security leaks that are becoming a national scandal—the "avalanche of leaks," according to Sen. Dianne Feinstein, that are somehow and for some reason coming out of the administration. A terrorist "kill list," reports of U.S. spies infiltrating Al Qaeda in Yemen, stories about Osama bin Laden's DNA and how America got it, and U.S. involvement in the Stuxnet computer virus, used against Iranian nuclear facilities. These leaks, say the California Democrat, put "American lives in jeopardy," put "our nation's security in jeopardy."

This isn't the usual—this is something different. A special counsel may be appointed.

And where is the president in all this? On his way to Anna Wintour's house. He's busy. He's running for president.

But why? He could be president now if he wanted to be.

It just all increasingly looks like a house of cards. Bill Clinton—that ol' hound dog, that gifted pol who truly loves politics, who always loved figuring out exactly where the people were and then going to exactly that spot and claiming it—Bill Clinton is showing all the signs of someone who is, let us say, essentially unimpressed by the incumbent. He defended Mitt Romney as a businessman—"a sterling record"—said he doesn't like personal attacks in politics, then fulsomely supported the president, and then said that the Bush tax cuts should be extended.

His friends say he can't help himself, that he's getting old and a little more compulsively loquacious. Maybe. But maybe Bubba's looking at the president and seeing what far more than half of Washington sees: a man who is limited, who thinks himself clever, and who doesn't know that clever right now won't cut it.

Because Bill Clinton loves politics, he hates losers. Maybe he just can't resist sticking it to them a little, when he gets a chance.

Whitney Houston - Star Spangled Banner

My Grandfather, His Farm and Me

Perhaps my grandchildren will appreciate a look at a time long gone both for me and for them. My father was the youngest son of a Maine potato farmer, whose other principal crop was beans grown for making baked beans. He and my grandmother grew their own vegetables, hand-milked their one cow for milk and butter (which grandmother churned except when I was around and got the job), raised chickens for eggs and Sunday dinner and laid out the dead folks in town to get some cash income in the winter.

I spent one whole summer living on the farm, located in Fairfield, Maine, when I was 10, and spent two weeks there every summer when I was a child, because my father spent every summer vacation there helping out his father. Grampa Wilcox was a very wise and quiet man who seemed to posses magical powers to forecast the future and heal the sick, but mechanical devices stumped him. He bought old cars to haul potatoes to market, and when they stopped running, he would haul them out back with his team of horses (I remember they were called Billy and Colonel). When my father got to Maine he would go to work repairing the old cars so Grandpa could use them again. When the cars were not repairable, Grandpa would haul them back into the woods. Many years later, when I became interested in antique cars, I traveled back to the old farm to find them, but someone else had beaten me to it.

Just to show you how much things have changed, I earned my first baseball glove that whole summer in Maine. One of the big problems a potato farmer faces is a nasty weed called mustard that must be pulled out by hand if you are a small farmer. The mustard weed has prickles that make it hard and painful to pull. To earn my keep at the farm I was told if I would work every day pulling mustard, I would get my baseball glove at the end of the summer. I won’t say I worked at it every day, but I did enough to get the glove, and remember to this day that it was a Marty Marion, a famous shortstop of that era. I used that glove throughout the rest of my baseball days.

Not only was Grandpa not tuned in to mechanical devices, but other scientific aspects of life were also a mystery to him. He had constructed a methane pit in the back yard that gathered the gas from the cow and horse manure, and provided the gas for the gas lights that lit the house and the barn in the early days before they got electricity. I have no idea how he managed to build this system, but one day it failed, and he went into the pit and lit a match to see what was wrong. Suffice it to say that he recovered from the explosion but never did that again. I was about 7 or 8 when the farm got electricity, but it never had plumbing.

This is not to say that Grandpa was not a learned and wise man. He knew more about life and nature than anyone else around, and was a person that people from all walks of life would consult for help and advice, and when he looked at you, you just knew that he knew everything. Unfortunately for me, the relationships that grandfathers had with their grandchildren was very different from many of today’s relationships. Grandpa came from a time when death came early and often to children, and families tended to have many children so some would survive. Children and grandchildren were expected to be “seen and not heard” – especially when adults were talking about something important.

One ritual I watched dozens of times was the prophesies Grandpa would make, on request, after some dinnertimes. Just as all meals were cooked on a wood stove in the kitchen, tea brewed from loose leaves was served at every meal. Grandpa would examine the empty tea cups after the meal, and poke around in the leaves left in the cup. Somehow he was able to see something in those tea leaves, and then he would prophesy the future for that particular tea drinker. I was always too young for my fortune to be told, and eagerly waited to grow up enough to hear it someday. Unfortunately that day never came for me. I got too busy, and Grandpa got too old.

The cynics who are all around us today would have laughed at Grandpa, but on that farm in Maine people from all over the state would come to him for advice and a prophesy, and for a faith healing service. Grandpa never charged any money for his efforts, and remained cash-poor throughout his life. Until he retired, he never left Maine, except for one famous trip. His oldest son who was my uncle, Irving, was a troublesome child who one day ran away and joined the circus that was passing through.

After several days Grandpa looked into his teacup and said he knew where Irving was, and that he was going to get him. He said Irving was still in the circus and now located in Virginia. He said Irving wanted to come home, but had no way to do it. Grandpa got on a train and went to Virginia. I don’t know any more of the details, but Grandpa and Irving arrived back in Maine shortly thereafter. Irving turned out rather badly as an adult, and became the black sheep of the family. My own father had to clean up some of Irving’s messes later on in life.

Two incidents involving me stick in my mind. One day on that long summer, Grandpa said he was going to spray the potatoes, and would I like to come along. We hitched the team of horses to a rig that had a large wooden barrel in its center, and a spray rig behind it. Then we pulled the rig into the woods and entered a large swamp that had water in it about 2 - 4 feet deep. It was an eerie and mysterious place, dark and forbidding with huge dragonflies flying all around. Grandpa got down into the water and filled the barrel using a pail. Then he mixed some deadly-looking blue-green chemical with the water, turning it all blue-green. We then drove the rig into the potato fields wearing kerchiefs over our faces, and sprayed the plants with this insecticide. It was undoubtedly some very bad stuff, but since Grandpa lived into his eighties, it obviously didn’t do him much harm.

Another time Grandpa said he was going to do some horse-hoeing, and would I like to ride Colonel while he did it. In horse-hoeing you use a single horse to pull a plow-like farm implement that has the blades arranged so that they shear along the sides of the hill-rows containing the potato plants, cutting through and pulling the weeds out. Unfortunately the saddle had seen better days and could not be fastened, so I rode on a saddle that was sitting loosely on Colonel’s back. It was just my luck that we disturbed a hornets’ nest, and they stung Colonel. He took off at a gallop, throwing off the saddle and dragging the horse-hoe behind him, bouncing along. I grabbed the handles on the horse-collar and hung on for dear life, screaming all the while. From the other side of the farm, my grandmother heard my screams and decided I had been bitten. She ran to scoop up some mud to put on my bites just as Colonel ran out of steam not far from where she had run. I jumped off, and Grandma ran up and put the mud on where she thought Colonel had been bitten. I was shaken up, but I was fine.

During World War II meat was in short supply, and you needed ration coupons to buy some. We went to Maine as usual one summer during the war, and something that seemed mysterious to me happened. Being summer, it was not deer season, and hunting deer was illegal. Very early one morning there was a kind of meeting among my father, my grandfather and a neighbor. There was a lot of whispering, and it was obvious that something unusual was going on, and then the men disappeared. The next day it was announced that we would be having liver for dinner, and at dinner I found out that it was deer liver. It seemed to me that it had a green color, and I couldn’t eat it. When we drove back to Providence our car contained a mysterious package, but when we got home my mother made my father go out in the back yard that night and dig a deep hole. Later it became obvious that she had put her foot down and made him bury the deer meat.

My mother did not like those summer vacations in Maine very much. She was a city girl through and through and hated using a privy during the day and a chamber pot at night. The farm women (there always seemed to be various family from Maine around) were also a very competent and hard-working bunch who could put together a marvelous meal complete with scratch biscuits – all made on a wood stove and without running water. I think these women made my mother feel inadequate. There was a pump handle at the slate sink in the pantry, but the water it produced was not potable. One of my jobs I had when I was there was to take an enamel pail and walk to a spring in the woods where the farm got its drinking water. I also remember that that big kitchen had a telephone in a wood box, and you cranked it to ring the operator.

The farm was actually quite large and included a small mountain that contained many fields and wooded areas. At the top of the mountain (or large hill if you prefer) there was a small, abandoned house where I used to play. Grandfather had built it for my aunt, just as he had built himself at least five other houses that had burned down from chimney fires. When Grandpa retired he and Grandmother moved to Raynham, Massachusetts, where he built a small two-room house. When that house was finished he built a larger house beside it, and then made the small house into a garage.
I lived for a while in Norton, Massachusetts, as a young married man, and was able to visit Grandpa from time to time in the short time he had after Grandmother died, bringing home with me vegetables from his garden. I don’t know if they remember, but some of my children, Connie, Sharon and Steve also visited there a few times.

In her later years in Raynham, Grandmother became well-known to the local police because she developed and suffered from arteriosclerosis and lost her short-term memory and knowledge of who she was. She would leave the house and get lost wandering around town, and Grandpa spent much time looking for her and reclaiming her from the police station. Grandmother died from old age, and Grandpa followed her not too long thereafter. We always felt that he passed away from a broken heart after he lost Grandmother.

I have so many wonderful memories of those times on the farm that I would not trade for anything. In the days before television, everyone went to the movies all the time, and Grandpa loved them so much he went almost every night and took me along to see Tom Mix and Gene Autry movies at the Opera House in Fairfield. He loved ice cream, too, and a stop at the Creamery in town for a sugar cone of rainbow flavor was also usually in the cards. I slept on the bed my Dad had used when he was a child, a tiny straw-mattress bed in a tiny room upstairs, listening to the strange noises and wondering about all those other empty bedrooms and whose they were and what might have happened there.

I can only hope my own grandchildren can look back someday with some happy memories of boating and sailing, cross-country skiing and that house in the woods in Dighton.

Abbott and Costello Discuss Unemployment

Thanks to Dave and Errol for this:

Unemployment as reported is at 9 percent. But it's actually more than 16 percent. Some smart statistician came up with a distinction ……A sleight of hand to make the unemployment number tolerable rather than frightening.

The concept is simple: 9 percent are unemployed and are actively looking for work. The 16 percent includes those who gave up and are no longer actively looking for work. So those casualties are no longer counted. They cease to exist. The 9 percent is a fake …….

A sham - and worthy of an Abbott & Costello routine. If that great comedy team were still alive, the routine on our unemployment woes might go something like this.

COSTELLO
I want to talk about the unemployment rate in America.

ABBOTT
Good Subject. Terrible Times. It's 9%.

COSTELLO
That many people are out of work?

ABBOTT
No, that's 16%.

COSTELLO
You just said 9%.

ABBOTT
9% Unemployed.

COSTELLO
Right - 9% out of work.

ABBOTT
No, that's 16%.

COSTELLO
Okay, so it's 16% unemployed.

ABBOTT
No, that's 9%...

COSTELLO
WAIT A MINUTE. Is it 9% or 16%?

ABBOTT
9% are unemployed. 16% are out of work.

COSTELLO
If you are out of work you are unemployed?

ABBOTT
No, you can't count the "Out of Work" as the unemployed. You have to look for work to be unemployed.

COSTELLO
BUT THEY ARE OUT OF WORK!!!

ABBOTT
No, you miss my point.

COSTELLO
What point?

ABBOTT
Someone who doesn't look for work can't be counted with those who look for work. It wouldn't be fair.

COSTELLO
To who?

ABBOTT
The unemployed.


COSTELLO
But they are ALL out of work.

ABBOTT
No, the unemployed are actively looking for work... Those who are out of work stopped looking. They gave up. And, if you give up, you are no longer in the ranks of the unemployed.

COSTELLO
So if you're off the unemployment rolls, that would count as less unemployment?

ABBOTT
Unemployment would go down. Absolutely!


COSTELLO
The unemployment just goes down because you don't look for work?

ABBOTT
Absolutely it goes down. That's how you get to 9%. Otherwise it would be 16%. You don't want to read about 16% unemployment do ya?

COSTELLO
That would be frightening.

ABBOTT
Absolutely.

COSTELLO
Wait, I got a question for you. That means they're two ways to bring down the unemployment number?

ABBOTT
Two ways is correct.

COSTELLO
Unemployment can go down if someone gets a job?

ABBOTT
Correct.

COSTELLO
And unemployment can also go down if you stop looking for a job?

ABBOTT
Bingo.

COSTELLO
So there are two ways to bring unemployment down, and the easier of the two is to just stop looking for work.

ABBOTT
Now you're thinking like an economist.

COSTELLO
I don't even know what the hell I just said!

If you count the underemployed, the figure is probably more like 23 %

The Whole Truth for a Change

His mother was an unabashed hippie from 1960s central casting. His father was an openly avowed Communist from Kenya. While his father wasn't around much, his devoutly progressive grandparents arranged for him to be mentored during his adolescent years by a dues paying member of the U.S. Communist Party, Frank Marshall Davis.

When he went to college, he was attracted to the Marxist professors and student activists, according to his own published memoirs. When he graduated, he moved to Chicago and became an instructor for the left-wing extremist organization ACORN in the social manipulation methods of radical Marxist agitator Saul Alinsky. He attended for close to two decades the Trinity United Church of Christ, which practiced neo-Marxist Black Liberation Theology. That church was headed during those years by the openly socialist Rev. Jeremiah Wright, who declared that the 9/11 terrorist attack on America was "America's chickens coming home to roost." He also famously preached from his pulpit, "Not God bless America, God damn America…."

He launched his political career in the living room of the home of Bill Ayers and Bernardine Dohrn, co-founders and former leaders of the openly Communist domestic terrorist organization, the Weather Underground. That organization conducted several bombings in America and engaged in other violence that resulted in several injuries and even deaths.

All of this is documented in the public record. This is the man the Democrat party took off the streets of Chicago, then pursuing a career as a Marxist street agitator, and launched into the White House, favoring him over Hillary Clinton because she was too moderate for the party. They did that because he best reflects the heart and soul of today's radical-left, Che Guevara Democratic Party. It is in this context that we should understand and analyze Obama's Hugo Chavez speech given last week at Osawatomie High School in Kansas.

Obama's Hugo Chavez Coming Out

In that speech, he drew a picture of America as a struggling third world nation, saying at stake today "is whether this will be a country where working people can earn enough to raise a family, build a modest savings, own a home, and secure a retirement." In fact, he said, "there are millions of working families in this country who are now forced to take their children to food banks for a decent meal."

This sounds more like Indonesia, or Venezuela, or Nicaragua. But it is not America "long before the recession hit."

He explained the roots of the problem as:

Over the last few decades, huge advances in technology have allowed businesses to do more with less, and made it easier for them to set up shop and hire workers anywhere in the world…. Steel mills that needed 1,000 employees are now able to do the same work with 100, so that layoffs were too often permanent, not just a temporary part of the business cycle…. If you were a bank teller or a phone operator or a travel agent, you saw many in your profession replaced by ATMs or the Internet.

This Luddite analysis fundamentally misconceives the role of technology in a modern economy. Such advancing technology increases worker productivity, and, therefore, wages and standard of living. Technological progress over the decades is why the average American worker in 2000 enjoyed 7 times the standard of living of the average American worker in 1900.

He then tries to pin the blame for his failures on others, saying, "Now, in the midst of this debate, there are some who seem to be suffering from a kind of collective amnesia. After all that's happened, after the worst economic crisis since the Great Depression, they want to return to the same practices that got us into this mess."

The policies that got us into this mess included primarily the so-called "affordable housing policies" Obama himself and other Democrats long advocated, with the government forcing the banks by overregulation to drop their traditional lending standards to provide loans and mortgages to low and moderate income applicants who could not qualify under those traditional standards. (See the full documentation and discussion in Paul Sperry's The Great American Bank Robbery: The Unauthorized Report About What Really Caused the Financial Crisis and Gretchen Morgenson and Joshua Rosner's, Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon.

The other major factor was the Fed's loose monetary policy starting under Bush in the 2000s, which funded the housing bubble. Both policies were departures from the fundamental planks of Reaganomics. As I discuss in detail in my own book, America's Ticking Bankruptcy Bomb, the four planks of Reaganomics had been effectively abandoned by 2008, and that was the cause of the financial crisis, which ended the 25-year economic boom from 1982 to 2007 that Reaganomics had created.

Obama tries to continue his historical revisionism, saying, "Remember that in those years, in 2001 and 2003, Congress passed two of the most expensive tax cuts in history, and what did they get us? The slowest job growth in half a century. Massive deficits that have made it much harder to pay for the investments that built this country."

Here is what really happened. Those Bush tax cuts quickly ended the 2001 recession, despite the contractionary economic impacts of 9/11, and the economy continued to grow for another 73 months. After the rate cuts were all fully implemented in 2003, the economy created 7.8 million new jobs and the unemployment rate fell from over 6% to 4.4%. Real economic growth over the next 3 years doubled from the average for the prior 3 years, to 3.5%.

In response to the rate cuts, business investment spending, which had declined for 9 straight quarters, reversed and increased 6.7% per quarter. That is where the jobs came from. Manufacturing output soared to its highest level in 20 years. The stock market revived, creating almost $7 trillion in new shareholder wealth. From 2003 to 2007, the S&P 500 almost doubled. Capital gains tax revenues had doubled by 2005, despite Bush's 25% cut in the capital gains rate.

The deficit in the last budget adopted by Republican Congressional majorities was $161 billion for fiscal 2007. Today that deficit is nearly 10 times as much. Total federal revenues under Bush soared by nearly 30%, from $1.991 trillion in 2001 to $2.568 trillion in 2007. The day the Democrat Congressional majorities took office, January 3, 2007, the unemployment rate was 4.6%. George Bush's economic policies, "the failed policies of the past" in Obama's rhetoric, had set a record of 52 straight months of job creation.

What has continued to fail us now is that Obama's own policies, the exact opposite of Reaganomics in every detail, have failed to produce any timely real recovery from the last recession. Before this last recession, since the Great Depression recessions in America have lasted an average of 10 months, with the longest previously at 16 months. But here we are today 48 months after the last recession started and there is still no real recovery. Instead, we have record poverty, and record extended unemployment.

They can't say that is because the recession was so bad, because the historical record in America is that the deeper the recession the stronger the recovery. Based on the historical record, we should be ending the second year of a booming economy right now. The failure to achieve that is the responsibility of Barack Obama.

Obama himself was counting on precisely this history making him look like a hero. That is why he so confidently told the Today Show on Feb. 2, 2009, "a year from now I think people are gonna see that we're starting to make some progress…if I don't have this done in three years, then this is going to be a one-term proposition."

Before Barack Obama as President, the rest of the world looked to America as the example for the economic model that works to achieve prosperity. But today Obama tells America "It doesn't work. It's never worked. It didn't work when it was tried in the decade before the Great Depression. It's not what led to the incredible postwar boom of the 50s and 60s. And it didn't work when we tried it during the last decade."

But it's President Obama, who fundamentally doesn't understand his own country, that doesn't work.

Obama's Tax and Spending Fantasies

In his Kansas speech, Obama offered as his solution increased government spending as the foundation for rising prosperity. He says:

Today, manufacturers and other companies are setting up shop in places with the best infrastructure to ship their products, move their workers, and communicate with the rest of the world. That's why the over one million construction workers who lost their jobs when the housing market collapsed shouldn't be sitting at home with nothing to do. They should be rebuilding our roads and bridges; laying down faster railroads and broadband; modernizing our schools -- all the things other countries are doing to attract good jobs and businesses to their shores.

Instead of the American capitalist model maximized by Reaganomics, Obama tells us to look at the basic infrastructure spending of other countries as the model that works. But American economic growth is not suffering because of a lack of basic infrastructure like a third world country. It is suffering because Obama is so doggedly pursuing the opposite of every policy that would free the economy to produce and boom. Under such Obamanomics, soon enough America will be suffering from the lack of a reliable energy grid like a third world country.

Obama whines that Bush's massive deficits (if his deficits were massive what are Obama's?), supposedly caused by his tax cuts (not--revenue again rose during the Bush years), "have made it much harder to pay for the investments that built this country and provided the basic security that helped millions of Americans reach and stay in the middle class -- things like education and infrastructure; science and technology; Medicare and Social Security."

But spending on all of those items soared during the Bush years, and they have rocketed up all the faster under Obama. To no avail, because government spending is not the foundation of increased economic growth and prosperity. Increased production, spurred by ever stronger incentives, is.

Of course, essential to all of President Obama's essential spending is to increase tax rates on the rich, otherwise known in English as the nation's investors and job creators. As President Obama tutored us in Kansas last week:

But we don't have unlimited resources. And so we have to set priorities. If we want a strong middle class, then our tax code must reflect our values. We have to make choices…. Do we want to make the investments we need in things like education, and research, and high-tech manufacturing? Or do we want to keep in place the tax breaks for the wealthiest Americans in our country? Because we can't afford to do both. That's not politics. That's just math.

So there you have the Obama formula for economic growth and prosperity. After the greatest runaway spending spree in American history during the Obama Administration, the answer is for government to increase spending even more, financed by increasing tax rates even more on the very investors and job creators that produce the jobs for the middle class and working people in America's economic system. That is a perfect prescription for another recession, not the long, long overdue recovery America is still waiting for under Obamanomics. Obama tells us, "It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay a higher tax rate than somebody pulling in $50 million." That would be wrong if it were true. But it is not.

What Obama is peddling to America on tax policy is only the ugliest example of his well-established rhetorical style of calculated deception. It is based on what he thinks the average voter does not know and will not know, and can be manipulated to believe to Obama's political advantage. For the picture he is painting of the rich getting away without paying their fair share while working people bear most of the tax burden is the opposite of reality.

Even before Obama was elected, under those "failed policies of the past," the top 1% of income earners in 2007 paid 40% of federal income taxes (up from 17.6% when Reagan entered office), while the CBO just reported that they earned 17% of the income in 2007. Moreover, that 40% of federal income taxes paid by the top 1% was more than paid by the bottom 95% combined, according to official IRS data. While the top 1% paid 40% of federal income taxes, the bottom 40% paid no federal income taxes as a group on net. Today 47% pay no federal income taxes.

Yet, Obama has already enacted under current law further tax increases on the nation's job creators, investors and small businesses going into effect in 2013, when the tax increases of Obamacare become effective and the Bush tax cuts expire. Consequently, that year the top two income tax rates would rise by close to 20%, the capital gains tax would soar by nearly 60%, the tax on dividends would nearly triple, and the Medicare payroll tax would rocket up by 62% for these disfavored taxpayers. This alone would take us well beyond the Clinton tax rates, despite Obama's outdated talking point that he is still repeating from 2008.

This is in addition to America suffering with virtually the highest corporate tax rate in the industrialized world at nearly 40% on average, counting state corporate rates. As I have previously noted, even Communist China imposes only a 25% rate, with the rate in the EU even less on average. Our Canadian neighbors, enjoying a booming economy since Obama was elected in America, will enjoy a 15% rate next year, down from 16.5% this year.

Yet Obama barnstorms America calling for still more tax increases on American business, large and small, and the job creators and investors on which jobs and prosperity for working people depend. The galloping regulatory burdens he is now imposing effectively involve still further tax increases stifling production. It all adds up to a brew for another recession in 2013, unless the American people force a change in course in 2012.

By Peter Ferrara on 12.14.11 The American Spectator