The Democrats Look for Job Creators

Not sure what Sen. Reid was trying to say. Millionaire job creators are all around us.

Perry Demonstrates His Commitment to Free Markets

It's Not a Lie if Holder Believes It

I bet Elizabeth Warren doesn't give parties like this...

The people of Massachusetts need to re-elect Scott Brown to the U.S. Senate, if only to have six more years of great Christmas parties like last Friday's little soiree for 1,400 supporters:

Photo by the Author

Photo from Scott Brown Facebook Page

Check out out www.scottbrown.com for ways to help.

BTW, I think that's Doug Flutie on drums.

Not About Class Warfare

Some Random Thoughts about the Debt Ceiling

Thought #1: The Administration is not bound by the debt ceiling. By authorizing spending, Congress de facto authorized the President to borrow whatever money was needed to make the authorized expenditures.

Thought #2: Even if thought #1 is wrong and the Administration is bound by the debt ceiling, there is still no reason for the Government to default. Money is still coming into the Treasury and the President will just have to prioritize how to spend it. However, debt service must be at the top of the list, due to the 14th Amendment (“The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”) In other words, if the Government defaults, that’s Obama’s decision alone, but such a decision would be unconstitutional.

Thought #3: Some pundits have suggested that we would be better off if Congress did not raise the debt ceiling. That would require the Federal Government to balance the budget immediately. Anyone advocating this should be expected to show how it could be done. As I’ve shown previously, the plan must include cuts to Medicare, Social Security, or Defense, or increased revenues.

School's in for the Summer

Off to summer school! Back in August.

Some great summer music...

What really happened on the 18th of April in '75...

There has been some controversy in the media recently over Gov. Palin's account of Paul Revere's ride. Here's what really happened...

Oval Office Plunder Summit

Source: Daily Mail

In view of the hundreds of billions of "stimulus" dollars that have disappeared into the coffers of Democratic constituencies, I don't think this is an unfair comparison.

Friedman on Collectivist Self-Praise

If anybody needs a break from jokes about Congressman Weiner, here’s a great Milton Friedman quote that I found recently. It’s from the preface that he wrote for the 1994 edition of Hayek’s The Road to Serfdom:

Many of those who profess the most individualist objectives support collectivist means without recognizing the contradiction. It is tempting to believe that social evils arise from the activities of evil men and that if only good men (like ourselves, naturally) wielded power, all would be well. That view requires only emotion and self-praise – easy to come by and satisfying as well. To understand why it is that ‘good’ men in positions of power will produce evil, while the ordinary man without power but able to engage in voluntary cooperation with his neighbors produce good, requires analysis and thought, subordinating the emotions to the rational faculty. Surely that is one answer to the perennial mystery of why collectivism, with its demonstrated record of producing tyranny and misery, is so widely regarded as superior to individualism, with its demonstrated record of producing freedom and plenty.

When Democrats Renege

An article about the 1982 budget deal, “When Reagan Raised Taxes” recently appeared on CNN.com. The author, Princeton History Professor Julian E. Zelizer, argued that Congress ought to pass a deficit reduction package that includes both spending cuts and tax increases. To conservative Republicans who support the former but oppose the latter, Professor Zelizer points out that even their patron saint, Ronald Reagan, once made a deal of this nature.

It is interesting to read what Reagan himself had to say about this deal. In his memoir he wrote, “To win congressional approval of additional spending cuts and show the financial community we were serious about reducing the deficit, I made a deal with the Congressional Democrats in 1982, agreeing to support a limited loophole-closing tax increase to raise more than $98.3 billion over three years in return for their agreement to cut spending by $280 billion during the same period; later the Democrats reneged on their pledge and we never got those cuts.”

IMHO, if Professor Zelizer wants the GOP to agree to a tax increase, it would be better if he did not bring up the events of 1982. Reminding Republicans that Democrats cannot be trusted is not an effective way to bring them to the negotiating table.

The Other Things Wrong with Obama’s Mideast Speech

The media coverage of President Obama’s May 19 Mideast speech focused mainly on the final third of his peroration, the portion dealing with the Arab-Israeli conflict. In it, the President reversed U.S. policy concerning Israel’s borders and expressed a willingness to entertain a Palestinian right of return.

Israeli Prime Minister Benjamin Netanyahu responded to the President in the Oval Office a few days later. Not only did he respond, he tore the speech to shreds and force-fed it to Obama with a side of humiliation pudding. Then he slapped Obama up and down the sidewalk while Obama’s friends were forced to watch.

I couldn’t possibly improve on what Mr. Netanyahu had to say about the President’s proposals: “based on illusions”, “can’t go back to those indefensible lines”, “wiping out Israel’s future as a Jewish state”, “not going to happen”. I thought instead I would comment on the two-thirds of Obama’s speech that did not concern the Jewish State. It received little attention, but it nevertheless demonstrated the naiveté and disregard for American interests that characterize this President. Among the key points:

“In Afghanistan, we’ve broken the Taliban’s momentum, and this July we will begin to bring our troops home and continue a transition to Afghan lead.”

For an organization that’s had its momentum broken, the Taliban is sure showing a lot of forward motion. According to today’s Wall Street Journal “Taliban insurgents widened their spring offensive to two relatively tranquil areas of Afghanistan where U.S. forces are preparing to begin handing security responsibilities to the Afghan military.” (See also, The New York Times “Taliban Attack in Herat, Far From Their Usual Areas” ). With the Taliban demonstrating its strength and the withdrawal deadline imminent, it’s fair to say the Obama’s Afghan policy is in disarray. His choice will be to delay the withdrawal or return to the days when that country hosted training camps for terrorist operations against the United States.

“We’re working with Congress to create Enterprise Funds to invest in Tunisia and Egypt. And these will be modeled on funds that supported the transitions in Eastern Europe after the fall of the Berlin Wall. OPIC will soon launch a $2 billion facility to support private investment across the region.”

Although the speech was full of pronouncements as to what the United States will and will not support, for the most part it lacked details as to what this support will consist of. The pursuit of Enterprise Funds was one of the few exceptions where the President provided specifics as to how he would influence the Arab world.

Unlike the nations of Eastern Europe, Egypt and Tunisia produce billions of dollars of black gold every year. It’s hard to see how they’ll be influenced by a few billion more coming to them at the expense of the American taxpayer. To attempt this at a time of trillion dollar deficits is irresponsible and mystifying. The only explanation I can come up with is that spending government money and calling it an “investment” is Obama’s solution to every problem (except manned space flight). In the absence of other ideas, he just went back to what he knows.

“The United States supports a set of universal rights. And these rights include free speech, the freedom of peaceful assembly, the freedom of religion, equality for men and women under the rule of law, and the right to choose your own leaders – whether you live in Baghdad or Damascus, Sanaa or Tehran.”

It is commendable that Mr. Obama supports these rights but his policies in the Mideast are unlikely to secure them for the Arab people. When elections are held in the Muslim world, the voters consistently opt for theocracy based on Muslim Sharia Law. This happened in Algeria 1990 and Turkey in 2002. Although the mullahs restricted the field of candidates in Iran’s 2005 Presidential elections, the Iranian people nevertheless elected Mahmoud Ahmadinejad, the most radical Islamist within the narrow field. In the 2006 elections for the Palestinian parliament, the majority of seats went to Hamas, an organization that the U.S. Government has condemned as terrorist.

There is every reason to believe that, if the army gives them the opportunity, the people of Egypt will also opt for theocracy. The largest block of seats in the Egyptian Parliament is already controlled by the Muslim Brotherhood an organization dedicated to the imposition of Sharia. The Egyptian public is sympathetic to this objective. In the Spring 2011
Pew Global Attitudes Project survey, 62% of Egyptian Muslims stated they believe “Laws should strictly follow the teachings of the Quran.” The Muslim Brotherhood position received 77% of the vote in a March referendum on Constitutional changes.

The part of the President’s speech dealing with the Arab-Israeli conflict was not the only part “based on illusions” – the whole speech suffered from that defect. Specifically the speech was based on the illusion that the well-organized Islamists rushing to fill the Mideast power vacuum share our dedication to freedom. Mr. Obama failed to recognize the ideological gulf that separates the United States from the Muslim Brotherhood and its fellow travelers, both in Egypt and elsewhere. The Brotherhood’s ideology is totalitarian – it subordinates every facet of life to the Quran. It is hostile to freedom, science, women, and non-Muslims. Like all totalitarians, the Brotherhood should be fought with the disinfectant of sunlight. With the world watching, Mr. Obama had an opportunity to do so in his Mideast speech. It is unfortunate that he did not.

Because so few are sounding the alarm bells, the result of this spring’s Arab uprising is likely to be that the Muslim Brotherhood and its allies will steal the revolution. A group of reprehensible, mostly unelected dictators who were friendly to the United States will be replaced by a group of reprehensible, elected dictators who are hostile to the United States. This is a tragedy indeed, both for U.S. interests and for the many genuine Arab freedom fighters who demonstrated in town squares in order to secure real liberty.

Santorum on Gay Rights

Since I'm a libertarian, conservatives are my natural allies. But I'll still call them out when they're really not making sense...

We lost a special election. Whatever shall we do?

Yesterday, Democrat Kathy Hochul beat Republican Jane Corwin in a special election in the 26th Congressional District of New York, giving Democrats control of a seat that has been held by Republicans for forty years. Although the MSM attributes the Hochul's victory to the GOP's "extreme" position on Medicare, it should be noted that independent Jack Davis garnered enough votes to affect the outcome. Having run and lost three times as a Democrat, Mr. Davis entered the race as the "Tea Party" candidate this time around, although he apparently has no actual affiliation with the Tea Party or its positions. Nevertheless, according to CNN, Democratic National Committee chairwoman Debbie Wasserman Schultz said the election "demonstrates that Republicans and Independent voters, along with Democrats, will reject extreme policies like ending Medicare that even Newt Gingrich called radical...With this election in the rear-view mirror, it is my hope that Republicans will accept the message being sent by voters in this race, in the polls and at town hall meetings across the country and work with Democrats to get our fiscal house in order while protecting Medicare and other initiatives vital to our economic recovery."

As a general rule, it's a bad idea to take advice from people who do not wish you well.

After two years of Obama ... Here's your change!

My cousin sent this to me. He didn't say where he got it, but to the extent that I'm familiar with the numbers, they appear to be accurate as of a couple months ago. In most cases, things are even worse since then...

	January 2009	TODAY	% chg	Source
Avg.. Retail price/gallon gas in U.S.	$1.83	$3.44	84%	1
Crude oil, European Brent (barrel)	$43.48	$99.02	127.7%	2
Crude oil, West TX Inter. (barrel)	$38.74	$91.38	135.9%	2
Gold: London (per troy oz.)	$853.25	$1,369.50	60.5%	2
Corn, No.2 yellow, Central IL	$3.56	$6.33	78.1%	2
Soybeans, No. 1 yellow, IL	$9.66	$13.75	42.3%	2
Sugar, cane, raw, world, lb. Fob	$13.37	$35.39	164.7%	2
Unemployment rate, non-farm, overall	7.6%	9.4%	23.7%	3
Unemployment rate, blacks	12.6%	15.8%	25.4%	3
Number of unemployed	11,616,000	14,485,000	24.7%	3
Number of fed. Employees	2,779,000	2,840,000	2.2%	3
Real median household income	$50,112	$49,777	-0.7%	4
Number of food stamp recipients	31,983,716	43,200,878	35.1%	5
Number of unemployment benefit recipients	7,526,598	9,193,838	22.2%	6
Number of long-term unemployed	2,600,000	6,400,000	146.2%	3
Poverty rate, individuals	13.2%	14.3%	8.3%	4
People in poverty in U.S.	39,800,000	43,600,000	9.5%	4
U.S.. Rank in Economic Freedom World Rankings	5	9	n/a	10
Present Situation Index	29.9	23.5	-21.4%	11
Failed banks	140	164	17.1%	12
U.S.. Dollar versus Japanese yen exchange rate	89.76	82.03	-8.6%	2
U.S.. Money supply, M1, in billions	1,575.1	1,865.7	18.4%	13
U.S.. Money supply, M2, in billions	8,310.9	8,852.3	6.5%	13
National debt, in trillions	$10.627	$14.052	32.2%	14

Sources:(1) U.S. Energy Information Administration; (2) Wall Street Journal; (3) Bureau of Labor Statistics; (4) Census Bureau; (5) USDA; (6) U.S. Dept. Of Labor; (7) FHFA; (8) Standard & Poor's/Case-Shiller; (9) RealtyTrac; (10) Heritage Foundation and WSJ; (11) The Conference Board; (12) FDIC; (13) Federal Reserve; (14) U.S. Treasury

There’s Hope for the Next Generation After All

In the classic movie, “Around the World in Eighty Days”, an Englishman and his party arrive in San Francisco in 1872 and find themselves amidst the spectacle of American democracy. Two gentlemen by the names of Mandiboy and Camerfield are going head-to-head at the ballot box. There are banners, fireworks, torchlight parades, a squadron of Mexicans on horseback, and saloon girls in corsets and fishnet stockings. One of the travelers wonders whether the Americans are choosing a new President. It turns out they’re choosing a Justice of the Peace.

Messers Mandiboy and Camerfield came to mind recently when I was friended on Facebook by a Mr. Jonathan Loya. Although I did not know him, I confirmed his friend request on the strength of some three-dozen mutual friends in the Tea Party. I soon began to see items in my news feed like “We knocked on another 67 doors today!” and “We just called 150 more homes today as part of our last push towards election day! In total, we have now reached 2,953 homes out of approx. 5000 in town, so we will hit the 3,000 mark tomorrow!” Impressed by his hard work, I looked at his profile to see what he was running for: it turned out to be Planning Board for the town of Holliston, MA.

I commented on one of his posts that I wished I lived in Holliston so I could vote for him. A few minutes later he IM’ed me to let me know there were other ways I could help his campaign.

Well, I walked right into that one.

I joined a standout for him this past Saturday. Although there were many candidates in downtown Holliston that morning, I found Jon easily. Although there were, alas, no saloon girls, he was standing by a big red banner that overshadowed anything the other campaigns had. I stayed for about two hours, which gave me ample opportunity to talk to the candidate.

Jon graduated Holliston High School is 2008 and is now a student at UMass Lowell. You can do your own calculation as to his age. He became interested in politics while following the 2008 Presidential election and then Scott Brown’s 2010 campaign for U.S. Senate. Jon describes himself as “fiscally conservative and socially tolerant”. When I asked him what influenced his views, he said, “It’s just common sense – don’t waste the taxpayers’ money.”

The main issue in the Planning Board election is the balance of economic growth against the benefits of preserving open space and small town New England charm. Jon took this issue head on during a debate against his opponent, Neil Osterweil. “Encouraging new business while still preserving the feel of our town,” Jon said, “can help alleviate the tax burden by creating a more substantial commercial tax base.” The need to alleviate the tax burden in Holliston is considerable. According to data from Boston.com (Town-by-town assessed home values and billed property tax amounts
in Massachusetts, from 2000 to 2010), the town has one of the highest property tax rates in the Commonwealth – well above the 90th percentile. Although Mr. Osterweil also claims to seek balance between preservation and growth, his emphasis during the debate tended to be on the criteria he would impose on new developments before he could support them. He did make it clear there is one land use he welcomes unequivocally: farming. Some members of the community, however, question Mr. Osterweil’s commitment to any economic activity invented post-Industrial Revolution. During the standout, one resident told Jon, “If Osterweil wins there won’t be anything built in this town.”

In addition to creating conditions for tax relief, Jon wants to improve communication – in both directions – between the Planning Board and the community. Although Planning Board meetings are not currently broadcast in Holliston, Jon wants to change this. He also thinks the board needs to do a better job of getting input from neighbors before developments go forward.

Besides running for public office, Jon plays the saxophone in the band Throwback, which performs classic rock at local venues. Their demo recording of the Beatle’s Daytripper is quite good.

It’s people like Jonathan Loya who keep our democracy running – people who feel strongly about their communities and are willing to work hard to make them better. It is especially important for the young to get involved. The election is tomorrow, Tuesday, May 24 at Holliston High School (Map). If you live in the town, please consider voting Loya for Planning Board. Even if you don’t live in Holliston, there are still ways to help the campaign. Volunteers are welcome to come to the school and hold a sign for Jon (outside the 150 foot statutory limit, of course). Polls are open from 7 AM to 8 PM.

If you want to see Throwback live, their next gig is at the Trackside Grille in Ashland (Map), Saturday, June 11 at 8 PM.

A little bathtime music...

What is it with the Today Show?

Deficits Don’t Hurt the Economy – But Taxes Might

I was recently involved in a Facebook thread about the relationship between deficits, taxes, and the economy.

One of my friends wrote, “if you look at our past four economic recoveries (Reagan, Clinton, Bush, and Obama) and compare them with the deficit, a very clear pattern emerges: the higher the deficit, the weaker the recovery. It seems to me that if you compare them with level of taxation, another pattern emerges: the higher the taxes, the stronger the recovery. I'm not claiming that higher taxes result in economic recovery, but it's clearly not the death-knell of the economy.”

In true nerd fashion, I reacted by making charts. You can take the Black Belt out of Six Sigma but you can’t take Six Sigma out of the Black Belt.

The first chart shows growth in Gross Domestic Product (GDP) as a function of the previous years’ Federal budget surplus or deficit. The technical details are below. As you can see, there is no clear correlation between the size of the deficit and the strength of a recovery. Although the Clinton recovery, during a time of budget surplus was strong, and the Bush recovery, during a time of above average deficits was weak, the Reagan recovery, during a time of even bigger deficits, was the strongest of all.

When you look at the entire data set, rather than just the three peak recovery years, no correlation between deficits and GDP emerges. Within the margin of error, the trend line is flat.

Taxes tell a different story. Again, there is no clear pattern in the peak recovery years. For the data set as a whole, there is a statistically significant trend: higher taxes equals lower growth. Every one percent increase in Federal revenues as a percentage of GDP corresponds to a 0.55% percent decrease in GDP growth. Taxes aren’t a death knell to the economy, but they do damage.

Although there is a correlation between taxes and growth, it is a weak one. Combined with the absence of correlation with deficits, the data suggests that Milton Friedman was right: other things drive the economy far more than fiscal policy. Monetary policy is one driver. As Friedman said in a 1996 interview, “One of the things I have tried to do over the years is to find cases where fiscal policy is going in one direction and monetary policy is going in the opposite. In every case the actual course of events follows monetary policy. I have never found a case in which fiscal policy dominated monetary policy and I suggest to you as a test to find a counter-example.”

Technology is another driver. The invention of the World Wide Web was clearly a factor in the strength of the Clinton recovery.

It should also be noted that the data falls into a narrow range. For almost the entire post-war period, the Federal account balance varied between a deficit of five percent of GDP and a surplus of two percent. But one data point sticks out dramatically - 2010. With deficits in excess of 10%, President Obama is taking us into new territory. The economic consequences of that remain to be seen.

---

Technical Details: The Federal tax and deficit data used in the charts comes from the “Fiscal Year 2012 Budget, Table 1.1—Summary of Receipts, Outlays, and Surpluses or Deficits (-): 1789–2016”, and is available from the Office of Management and Budget. The GDP data used comes from the “Current-Dollar and ‘Real’ Gross Domestic Product”, April 28, 2011, and is available from the Bureau of Economic Analysis.

The slopes of the trend lines and the uncertainty in the slopes were calculated using the Excel LINEST function which uses the least-squares method for fitting a line to the data. My claim above that there is no correlation between deficits and GDP growth is based on the slope of the trend line being less than the deviation. In the case of taxes, the slope is between two and three deviations.

My friend pointed out that, “There's going to be a lag between policy changes and their effect.” The charts are based on a one-year lag, e.g. the 2010 GDP is plotted against 2009 deficit and receipts. I found the one-year lag gave the strongest correlation (highest R-value).

I identified the various economic recoveries with the years in which economic growth peaked. I make no claim that this is the best way, or even a good way to measure the strength of a recovery.

The "Right" to Health Care

Last week, Senator Rand Paul of Kentucky offered some controversial thoughts about the medical profession. “With regard to the idea whether or not you have a right to health care,” he said, “you have to realize what that implies. It’s not an abstraction. I’m a physician. That means you have a right to come to my house and conscript me. It means you believe in slavery.”

I posted video of Sen. Paul’s statement on my Facebook page with two comments: “Profoundly philosophical” and “You cannot have a right that requires the labor of other people.”

I’m blessed to have many insightful friends and relatives (and relatives of friends) on both sides of the aisle, and a spirited debate followed. Thank you D.F., T.S., S.I., D.B., P.E., K.O., and E.E.. I wanted to address a few of the points you raised (although for the most part, you already addressed each other!):

Rights can be legal or moral.

The discussion got me thinking about the relationship between the two. IMHO the Declaration of Independence got it right: “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed.”

It’s clear that in the minds of the Founders, rights are more fundamental than government. Rights come from God (or for us atheists, nature). All rights, therefore, are moral rights. Given that governments are instituted to secure rights, it follows that the effectiveness of a government in achieving its raison d’etre can be measured by the extent to which moral rights are also legal rights.

This is not an “honest” argument. Sen. Paul and other libertarians know perfectly well that no one plans to force doctors to provide their services.

I think what you’re saying is that this is a straw man argument, that Sen. Paul is attributing a belief to his opponents that they do not actually hold, for the purpose of refuting it. But actually, it is not a straw man argument – it is a reductio ad absurdum. As such, it is a valid logical construction. The claim is that the argument advanced by the opposing side – that there is a right to health care – would, if taken to its logical conclusion, lead to something absurd – enslavement of doctors.

This particular reductio ad absurdum is one that libertarians take very seriously. It originated with their patron saint, Ayn Rand. There are conflicting reports as to whether Sen. Paul got his name from her. He certainly got his ideas from her. In her 1963 essay, “Man’s Rights”, she wrote, “If some men are entitled by right to the products of the work of others, it means that those others are deprived of rights and condemned to slave labor.” Rand’s essay provides a thorough treatment of the issues involved; I highly recommend reading it in its entirety in her book The Virtue of Selfishness.

In his response to Sen. Paul, Bernie Sanders of Vermont asked doctors whether they consider themselves slaves. He need not have bothered. Sen. Sanders is correct that doctors are not slaves in existing single payer systems. The defining characteristics of slaves – that they are not compensated and cannot quit – do not apply to doctors in the various regulated health care systems of the developed world. In these systems, doctors "merely" have considerable restrictions on their liberty to assign a course of treatment or set the terms of their compensation.

However, this does not refute Sen. Paul’s argument for two reasons. First, Sen. Paul was talking about a universal health care system. Sen. Sanders shifted the discussion to the existing non-universal system in the United States. Second, Sen. Paul did not claim that any particular system provided a right to health care or freedom for doctors; he merely argued that you can’t have both. Consistent with his argument, existing universal systems do not provide patients with a right to health care. We see this in countries where universal health care has been implemented. Bureaucrats dictate the level of service that will be provided. If patients need or want more than decreed, they can pay for it themselves (if that’s allowed) or join a wait list and hope they don’t die before they get treatment. Long wait lists, and occasional unnecessary deaths, are inherent in the single payer systems of Canada, Great Britain, and other semi-socialist countries. The sorry record of single payer systems, and their lack of patient rights, are documented extensively by Goodman, Musgrave, and Herrick in their fine study Lives at Risk: Single-Payer National Health Insurance Around the World. Clearly patients who must pay out of pocket or die waiting do not have a right to health care.

Negative and positive rights are complex and mutually interdependent.

For those just joining us, a negative right imposes an obligation on other people not to do something. For example, your right to life obligates other people not to kill you. A positive right obligates other people to do something. The supposed right to health care is an example of a positive right.

The problem with positive rights is not they are interdependent with negative rights. The problem with positive rights is that they violate negative rights. A system of rights that is contradictory – where some rights violate other rights – cannot be put into practice. Using the example of health care again, a right to health care violates the doctor’s right to liberty. Positive rights can only be consistent with the right to liberty if individuals take on the obligation voluntarily – for example by signing a contract.

It is not fair that the government forces us to see and pay a doctor to obtain a prescription that we already know we need.

I wholeheartedly agree – on the basis of the negative right to liberty. I’d make an exception for antibiotics, since their misuse can violate other people’s negative right to life.

This is merely a semantic argument; health care is better addressed in practical terms.

If you prefer to consider the issue in purely practical terms, I again recommend the Goodman, Musgrave, and Herrick book; it systematically refutes each of the practical arguments for single payer systems. However, I do believe that, as Sen. Paul said, the rights-based argument is not an abstraction. There is a real issue involved because those who promote universal schemes often do so on the basis of a right to health care. What Sen. Paul has shown is that this concept is not intellectually coherent and that therefore a universal health care system cannot be justified on that basis.

A Little Kill Bill Music

Government Warning

Obama's Brilliance

Professor Haidt's comments can be found in this article

CNN: Never Seen Photos of Sophia Loren!

Mitt explains the difference between Romneycare and Obamacare

A little Yom Ha'atzmaut Music

This week marks the 63rd anniversary of Israeli independence...

Free Ride is Over: The President's Economic Cluelessness

As promised, I gave Obama a three-day pass in recognition of his contribution to the ending of Osama bin Laden. But now it’s time to take the gloves back off and call him out on his silly radio address about gas prices…

Sources and Photo Credits

There are many things about which reasonable people can disagree. The fundamentals of economics are not among them. The laws of supply and demand are well established, both theoretically and empirically:

• if you raise the demand for a product such as health care, either by requiring people to buy insurance or by subsidizing those who could not otherwise afford it, then, other things being equal, the price will go up.
  
• if you implement a price floor on a product such as labor, and the price floor is above the market price, then, other things being equal, there will be less demand for the product. In the case of minimum wage laws, this will hurt the very people you seek to help by making them unemployed.
  
• if you raise the cost of providing a product such as gasoline by eliminating tax breaks or subsidies for the producer, then, other things being equal, the price will go up. As I’ve discussed previously, there are some sound free market arguments for repealing special privileges for oil companies. However, I have no illusions that doing so will lower the price of gasoline.
  

There’s no nice way to say this: if the President says that Obamacare will lower medical costs, that raising the minimum wage will help the poor, and that eliminating subsidies will lower gas prices, then he really is clueless about how markets work. Or he thinks that we are.

Please remember the victims of last week’s tornados in their hour of need

With the death of Osama bin Laden, a royal wedding, and something about a birth certificate, it has been an eventful week and many important stories have gotten lost in the shuffle, including this one.

The tornados that cut a swath from Texas to New York killed hundreds of people and flattened thousands of homes and businesses. This article from ABC News tells the horrific story.

When disaster strikes, the Red Cross is on the scene, helping with the cleanup and delivering meals. In this video, a Red Cross volunteer talks to survivors and shows us some of the damage:

Please assist the people of the Red Cross in their good work. You can volunteer or make a donation at www.redcross.org. You can also text REDCROSS to 90999 to make a $10 donation to help those affected by this disaster.

After the Demise of Osama bin Laden. The Today Show Reports.

I got to give credit where credit's due.

Obama got one right. In recognition of this accomplishment, I'll stop making fun of him - at least for a couple of days. Fortunately, the Today Show is still fair game...

Osama bin Laden Killed by U.S. Forces

Photo credit

CNN Covers the Royals

The Donald: Six Months Later. And - What Will William Wear?

Sources and Photo Credits

Book Review (Part II) – The Grand Jihad: How Islam and the Left Sabotage America

In Part I of this review I discussed the portions of Andrew McCarthy’s The Grand Jihad concerning the Muslim Brotherhood’s activities in the United States. The book describes efforts by the Brotherhood and its satellite organizations to replace the Constitution with Sharia Law.

Mr. McCarthy is an expert on these organizations due to his tenure in the U.S. Attorney’s office; he builds a compelling and well-documented case that the Brotherhood (unlike millions of patriotic American Muslims) is up to no good.

Today I want to address his claim that American liberals are co-conspirators.

Here Mr. McCarthy leaves his area of expertise and stakes out shakier ground. He may be aware of this. In a talk he gave about the book, which I attended, he omitted discussion of the American left. While The Grand Jihad does document some ties between the Obama Administration and Brotherhood satellites, it falls short of proving its claims of the Administration’s “overt subservience” to Islam. After rehashing conspiracy theories that Obama is a secret Muslim, McCarthy concludes grandly, “There is no known evidence of his having made an adult choice to practice Islam.” An opening chapter that argues the President’s infamous bow to the King of Saudi Arabia was an intentional signal of their “shared dream” of “supplanting Western political, economic, and cultural values” is pure speculation. In addition to speculation, McCarthy relies on the identification of code words to build the prosecution’s case against Obama. The Muslim Brotherhood pursues a “bottom up” strategy. Obama said in his encounter with Joe the Plumber that he wants the economy to be “good for folks from the bottom up”. What a giveaway.

Pouncing on code words to “prove” Obama’s Muslim allegiance makes Mr. McCarthy come across as a kook, which is too bad because he’s not one. He is a professional terrorist hunter and occasional deep thinker. A chapter that compares Muslim Brotherhood theoretician (and Osama bin Laden influence) Sayyid Qutb with French romantic Jean-Jacques Rousseau is profoundly philosophical. Mr. McCarthy shows real insight in recognizing that Rousseau occupies the same place in modern liberalism that Qutb occupies in modern Jihad; they are both the intellectual fathers (or in Rousseau’s case, perhaps grandfather) of their movements. For those who suggest that fundamentalist Jihadis and secular liberals have little in common, McCarthy points out that when viewed in terms of individualism and collectivism, instead of heaven and earth, the two camps are collectivist soul mates.

Mr. McCarthy’s failure to build a case against the Obama Administration should not detract from his persuasive argument for concern about the Muslim Brotherhood’s tentacles in our society. He talks briefly about what to do about it. At no time does he dispute the rights of Muslims living in the West to express their opinions, build enclaves with like-minded people, or write arbitration by Sharia law into their private contracts. But he does seek to subject them to the disinfectant of sunlight. “Defending ourselves will require flushing out the Islamists: identifying them and imposing on them the burden of defending their totalitarian ideology against the positive case for liberty and human reason.”

Book Review – The Grand Jihad: How Islam and the Left Sabotage America

Recently I attended a talk by Andrew C. McCarthy of the National Review Institute. Mr. McCarthy is a former Federal prosecutor and the author of The Grand Jihad: How Islam and the Left Sabotage America.

During his tenure at the Justice Department he prosecuted Omar Abdel Rahman (“The Blind Sheikh”) and his co-conspirators in the 1993 bombing of the World Trade Center; Sheikh Rahman is now a lifetime guest of the Federal government. Mr. McCarthy also participated in the early stages of the investigation into the September 11 attacks.

He drew two conclusions from his sojourn in the world of radical Islam. First, there is a large, well-financed network of supposed Islamic moderates who seek to overthrow the United States Constitution and replace it with the traditional Muslim legal system known as Sharia. Second, President Obama and other American liberals are willing partners in this nefarious enterprise.

Many of Mr. McCarthy’s accusations are based on writings of radical Muslims themselves. As a person of Jewish origin, I’m sensitive to blood libels, to false accusations against a Semitic minority. I know all too well the harm done to the Jews when the Russian government fabricated The Protocols of the Elders of Zion. For that reason, I took the trouble to double check some of the key sources listed in the book’s extensive endnotes (there are 60 pages of them). Whenever I did so, the sources checked out. I also searched online for accusations that these sources were forgeries; I didn’t find any. I rather wish they were forgeries, because what they say is bloodcurdling.

“[T]he terrorist threat,” Mr. McCarthy writes, “pales beside a lurking reality: the massive fundamentalist pool is churning out legions of activists who wish to end our way of life and who believe that there are plenty of avenues besides mass-murder for pursuing that goal.” Often, these activists are labeled “moderate” because of their (qualified) opposition to terrorism. However, as Mr. McCarthy said in his talk, “If you want to replace the Constitution with Sharia, but you’re not willing to blow up a building to do that, well, we’re grateful that you don’t want to blow up a building, but you’re not a moderate.” He uses the term “Islamist” to describe these activists, in order to distinguish them from the millions of genuine moderates such as Dr. M. Zhudi Jasser who seek to reconcile their Muslim heritage with the American values of freedom and capitalism.

There really are Islamists out there; The Grand Jihad documents this extensively. I’ll confine myself to three examples:

• Sheikh Yusuf al-Qaradawi is to the Muslim Brotherhood what Mikhail Suslov was to the Soviet Union: Ideologue-in-Chief without Portfolio. He’s a “moderate” who opposes violent Jihad. Except against Israelis. And American military targets. And also any civilians who help said military targets. This moderation earned him praise from the U.S. State Department. According to Alberto Fernandez from the Bureau of Near Eastern Affairs, al-Qaradawi is an “intelligent and thoughtful voice”. At a 1995 Muslim Arab Youth Association conference, the intelligent and thoughtful voice said, “[W]e will conquer America, not through the sword but through dawa [missionary work]”. This threat was not uttered in Gaza or Beirut or any of the other centers of radicalism in the Middle East. It was uttered in Toledo Ohio. Sheikh Qaradawi then went on to cite scriptural authority for killing Jews.
  

  Al-Qaradawi promotes the “enclave” strategy, the establishment of independent Sharia communities in Western cities; Zeyno Baran’s paper, “The Muslim Brotherhood’s
  U.S. Network” calls it “voluntary apartheid”. McCarthy writes, “That this is a Trojan horse cannot be seriously doubted. Qaradawi is candid: ‘Were we to convince Western leaders and decision-makers of our right to live according to our faith – ideologically, legislatively, and ethically – without imposing our views or inflicting harm on them, we would have traversed an immense barrier in our quest for an Islamic state.’” Already there are Muslim neighborhoods in Australia and Sweden where the police no longer go. The situation is less dire in the United States. Mr. McCarthy said in his talk that American law enforcement is more determined than its Australian and Swedish counterparts to maintain sovereignty over its jurisdiction. But even though the police aren’t afraid to enter them, enclaves nevertheless exist. I wrote about the tragedy of the Somali enclave in Minneapolis (and also about Dr. Jasser) in an earlier blog entry.
  

  For more about al-Qaradawi, see his Investigative Project on Terrorism profile.
  

• In 2008 the Holy Land Foundation was convicted of providing funding to the terrorist organization Hamas. Among the evidence at the trial was a document entitled “An Explanatory Memorandum of the General Strategic Goal for the Group in North America”. This blueprint for the infiltration of the U.S. was written in 1991 by Mohamed Akram. According to McCarthy, Akram was “an intimate associate of Sheikh Yusuf al-Qaradawi” and the Muslim Brotherhood’s “top leader in America”. One passage in the Memorandum provided McCarthy with the title of his book: “The Ikhwan [Brotherhood] must understand that their work in America is a kind of grand jihad in eliminating and destroying the Western civilization from within and ‘sabotaging’ its miserable house by their hands and the hands of the believers so that it is eliminated and God’s religion is made victorious over all other religions.” McCarthy comments: “It is not every day that, even as the game is being played, the opposition’s playbook falls into your hands.”
  

• According to its American website, the objective of the Hizb-ut-Tahrir (Party of Liberation) is to bring “Muslims back to living an Islamic way of life in Dar al-Islam and in an Islamic society such that all of life's affairs in society are administered according to the Shari'ah rules… It also strives to bring [Islam] back to her previous might and glory such that she wrests the reins of initiative away from other states and nations, and returns to her rightful place as the first state in the world, as she was in the past, when she governs the world according to the laws of Islam.” In this video from a 2009 Party conference in Oak Lawn, Illinois, an unidentified “imam” says that if the U.S. joined the Muslim world, the Constitution would be “gone”. If you think he’s speaking purely hypothetically about the Islamic States of America, see the part of the previous quotation about governing the world.
  

McCarthy goes on to describe the intricate network of organizations created by Islamists to promote their interests. What he calls “the Siamese connectedness of these ventures” is so complex that I had to draw a diagram to follow the narrative.

Click for larger image

The same names appear over and over again among the leaders of these organizations. In many cases they have offices in the same buildings. At the center of the web is the Muslim Brotherhood. Remember, the Brotherhood is not a moderate organization; see the quotes from al-Qaradawi and Akram, above. As you can see in the diagram, the Brotherhood has its fingers in everything. Brotherhood alumni run al-Qaeda. J. Michael Waller of the Institute of World Politics testified in front of a Senate subcommittee that a Brotherhood satellite organization, the North American Islamic Trust, “finances, owns, and otherwise subsidizes the construction of mosques and is reported to own between 50 and 79 percent of the mosques on the North American continent.” The Obama administration is reaching out to the Muslim community via other Brotherhood satellite organizations.

Which brings me to Mr. McCarthy’s second point. I’ll address the relationship between the American left and radical Islam later this week.

Facebook for Cats

Completely non-political today.

Stop Tea Party Racism – If You Can Find Any

Yesterday I posted video of Patriots Weekend Tea Party rallies from around New England. These were fun events with fantastic speakers. I had a great time.

But I would like to say a few words about some guests who did not share the goals of their hosts. The Tea Party must be making an impact because the counter-protesters are becoming more aggressive. On the Boston Common, I was confronted with this ugly scene:

Just as the speeches were getting underway at the Parkman Bandstand, a group of gentlemen from the School Bus Drivers Union, the Steelworkers, and other labor organizations joined us. They muscled their way in between the crowd and the bandstand, blocked the view with a bedsheet, and chanted through a megaphone:

Racist, Sexist, Anti-Gay
Tea Party Bigots, Go Away!

The noise was intended to drown out the speakers, including the Reverend Paul Jehle, who was attempting to lead the crowd in an opening prayer at the time. This was not an isolated incident. Bill O’Reilly reported similar unpleasantness in Oregon, Arizona, and Wisconsin.

I originally intended to use this space to express my indignation. After all, if someone shouts down people who are trying to speak, that's a sure sign he doesn’t have any arguments of his own. If someone shouts down people who are trying to pray (and I speak as an atheist) that's a sure sign he's an asshole.

But better writers than me have already made these points. Michael Graham of WTKK Radio, who, as emcee for the event, took the brunt of the union heckling, had this to say:
Boston Tea Party Rally: Goons Vs. God (In all fairness to the union, I think Mr. Graham gave as good as he got. “Shut the Biden up!”).

Instead of complaining, I decided to reach out to the Left. Racism, sexism, and homophobia are, after all, terrible, repulsive things. There’s no place for them in the Tea Party. I’m sure my friends on the other side of the aisle wish to join me in eradicating these evils from our movement. Here’s how you can help: I put together a gallery of the signs I saw, both at the Boston rally and at a rally earlier in the day at the New Hampshire State House. Please look through them and let me know which are the racist ones, which are the sexist ones, and which are the anti-gay ones:

Restore the Constitution. No more undeclared Wars!

The Constitution Does Matter.

Self Reliance is Freedom. Government Reliance is Oppression.

Atlas will Shrug.

Who is John Galt?

14,000,000,000,000+ (trillion). Isn’t that enough debt? Stop spending & Stop spending my grandkids into debt.

Man is not free unless government is limited. – Ronald Reagan

It is not a tax problem. It is a spending problem. Stop spending.

I have sworn upon the altar of God, eternal hostility against every form of tyranny over the mind of man. – Thomas Jefferson

Thank you for your help with this. I know you are adept at finding hatred where the rest of us see only macroeconomics and Constitutional jurisprudence. Once you have satisfactorily explained to us which signs are bigoted, we can be on the lookout for them at future rallies, and ask anyone carrying one to put it down or leave.

Ok, I had some fun with this. I sucked sarcasm dry. But there are a couple serious points in there that I'm sure you picked up on: 1) The Tea Party came together because of concern that the Federal government was spending irresponsibly and trespassing beyond the boundaries set for it by the Constitution. The notion that fiscal sobriety and enumerated powers discriminate on the basis of race, gender, or sexual orientation is ludicrous. 2) I meant what I said above, that bigotry is terrible, repulsive, and evil, so much so that no one should throw around accusations of it without credible evidence. BTW, signs with swastikas that, on investigation, turn out to be carried by counter-protesters, or the unsubstantiated allegation that Tea Partiers hurled racial epithets at Congressman John Lewis do not come under the heading "credible". Please don't bother to bring up the latter incident unless you're prepared to show me video of it.

I would like to thank the (unionized) Boston Police for maintaining order at the rally. By providing a human barrier between the counter-protesters and the Tea Partiers, they ensured that nothing more serious than noise marred our event.

Finally, I want to thank this guy for making the most important point of all:

T’s don’t have to be loudmouthed thugs to be heard. We just vote vote vote.

2011 Patriots Day Tea Parties - Boston, Worcester, and Concord NH

With Free Market Warrior Loren Spivack and Presidential hopefuls Tim Pawlenty and Herman Cain. "We got some altering and abolishing to do!"




Loren Spivack reads from his Cat in the Hat parody, The New Democrat:



More from Gov. Pawlenty and Mr. Cain:




Tea Partiers are generally polite. It's not easy to get them to make some noise. But Dr. Colin Blake guy pulled it off. Warning - strong language:

Movie Review: Atlas Shrugged Part I

“The most anticlimactic non-event since Geraldo Rivera broke into Al Capone’s vault.” – Roger Ebert, The Chicago Sun Times


“[C]uts corners in every respect.” – Peter Debruge, Variety


“Botched” – Todd McCarthy, The Hollywood Reporter

“Atlas Shrugged Part I” has at least one thing in common with the epic Ayn Rand novel on which it is based.

The critics hate it.

But as Teddy Roosevelt said, “It is not the critic who counts.” The 26th President went on to explain, “The credit belongs to the man who is actually in the arena…who knows great enthusiasms, the great devotions, who spends himself in a worthy cause.” In this case, the man in the arena is Cybex International CEO John Aglialoro. It turns out Mr.Aglialoro and I were both in the audience for Ayn Rand’s last Ford Hall Forum speech in 1981. Mr. Aglialoro has devoted many of the years since then to bringing her magnum opus to the big screen. He acquired the rights in 1992 and set out to sell the project to a studio. Although he got close several times, including one venture that was to star Angelina Jolie, the deals always fell through. Last year, with the expiration of his rights to the story imminent, Mr. Aglialoro decided to produce the film himself. Due to the approaching deadline and the lack of studio backing, it was necessary to complete filming in six weeks with a pathetic production budget of $10 million.

The result is magnificent.

The movie, which covers Part I of the three-part novel, is set in the not too distant future. The collapse of the Middle East has caused the Dow Jones to crash to 4,000 and driven the price of gasoline to $37 per gallon. Amid depression-level unemployment, Americans are giving up, expressing their resignation in the slang phrase, “Who is John Galt?” The only thing preventing a complete reversal of the industrial revolution is a thin ribbon of railroad track connecting the Wyatt Oil fields of Colorado to the rest of the United States. Unfortunately, the century-old track is crumbling; wrecks are frequent and catastrophic.

It falls to the heroine, Dagny Taggart, to rebuild the line and thereby save the country. The new track is to be made of Rearden Metal, an untried alloy, lighter, stronger, and cheaper than steel, invented by industrialist Hank Rearden. In defiance of the despair and mediocrity around her, Dagny rechristens the stretch of track from Cheyenne to Wyatt Junction “The John Galt Line”. Together, she and Hank must overcome bureaucratic meddling, threats from union bosses, opposition from the State Science Institute, and the mysterious and always untimely disappearances of their allies. Like Mr. Aglioloro, they have an impossibly short time to complete a monumental task.

The casting of the leads is excellent. The tough-as-rails Dagny is a challenging role for an actress. She is an extremely passionate woman who is outwardly unemotional. The lovely Taylor Schilling steps up to this challenge beautifully and also shows genuine sparkage in her scenes with Grant Bowler’s Hank Rearden. The tall, angular Mr. Bowler looks like an Ayn Rand hero; in fact, he looks like Rand’s husband, Frank O’Connor. His shy half-smile makes him thoroughly likable. In an era when so many businessmen are desperate to assure us they’re working for the public good, it is refreshing to hear Mr. Bowler boast unapologetically, “My only goal is to make money.” As director Paul Johannson said, “I got the right Rearden.”

Johannson’s success in getting the right leads is offset by mixed results with the supporting cast. With his out-of-date pencil mustache and overly familiar manner, Jon Polito is perfectly sleazy as Hank Rearden’s Jeff Immelt-style competitor Orren Boyle. Michael Lerner portrays bureaucrat Wesley Mouch as a chunky mediocrity with a Jersey accent. As we were leaving the theater, one of my friends joked, “How did they get Barney Frank to play the part?” Armin Shimerman (Principal Snyder from “Buffy the Vampire Slayer”) brings the snide malevolence he’s so good at to the role of Dr. Potter from the State Science Institute. On the downside Rebecca Wisocky is somewhat wooden as Lillian Rearden and Patrick Fischler is way too trendy for businessman Paul Larkin. Johannson himself, doubling as John Galt, has this weird Keannu Reeves vocal inflection thing going.

“Atlas Shrugged Part I” is cinematic in the best sense of the word: every frame is visually stunning. You can get a sample from this video I put together from publicity stills:



The luxurious marble offices, hotels, and bars of New York are, in the book’s phrase, places of competence and power; the sweeping vistas of the Colorado mountains breathtaking; the old wood paneling in Ellis Wyatt’s Victorian house so rich you can practically smell the furniture polish. I confess that I got a little choked up at the first sight of the sparkling blue-tinged rail of the John Galt Line; it is as much a star of the film as Taylor Schilling or Grant Bowler.

Fitting the first 336 pages of the novel into an hour and forty-two minutes necessarily requires omitting some lines and scenes. Like any Ayn Rand fan, I was destined to be disappointed by some of the choices. In particular I missed the one-liners Dagny’s ex-lover Francisco d’Anconia lobbed at the villains during a party for Hank Rearden’s wedding anniversary. (Earnest matron: “We were just discussing a most interesting subject. Dr. Pritchett was telling us that nothing is anything.” Francisco: “He should, undoubtedly, know more than anyone else about that.”) Not only are these lines absent, but the whole tone of the scene is wrong. It looks like a really fun party with lots of toasting and jazz music. The scene fails to communicate that Rearden, who doesn’t like parties to begin with, and is especially ambivalent about one celebrating his loveless marriage to Lillian, is not having a good time.

In that, he differed from me and the friends who joined me at the theater. We had a great time. When it ended and the lights came on, one of them said, “I want three more hours.” So do I. Can’t wait for Part II. The critics really don’t count.

Eine Kleine Tea Party Musik

Chris Ross played this at the Greater Boston Tea Party Rally on Friday...

Promote Freedom on Patriots' Day Weekend: Support the Tea Party and the Atlas Shrugged Movie

This week we observe the third annual Tax Day Tea Party rally, the 149th anniversary of the emancipation of slaves in Washington, D.C., the 236th anniversary of Paul Revere's ride and the Battles of Concord and Lexington, the 268th birthday of Thomas Jefferson, and the 3,322nd anniversary (approximately) of the Exodus of the Israelites from slavery in Egypt. In short, it is a time of great significance for those who revere (pun intended) freedom.




What we in Massachusetts call Patriots' Day Weekend will feature numerous Tea Party rallies across the nation, as well as the premiere of the movie version of Ayn Rand’s epic novel Atlas Shrugged. Please take the time to attend one or more of these events. Even if you are not sympathetic to the aims of those “racist Teabaggers”, or you hear, as Whittaker Chambers did, a voice commanding from every page of Atlas Shrugged “To a gas chamber – go!”, check out a rally or a matinee anyway – they might not be what you expected, and in any case I’d be interested in hearing what you think.

You can find a Tea Party get-together in your area on Tea Party Patriots’ Events page (I did find a mistake on this page, so, to ensure accurate information, follow the links to the organization actually sponsoring the event). In the Boston area,

• Presidential hopeful and former Minnesota Governor Tim Pawlenty will headline a rally on the Boston Common. Parkman Bandstand, Friday, April 15th, 4:00 – 6:00PM (with musical acts starting at 3:00), see greaterbostonteaparty.com for details.
  
• The Worcester Tea Party will protest pork barrel spending with speakers, music, and a pig roast. Lincoln Square, Monday, April 18, 4:00 - 5:30PM, see www.worcesterteaparty.com for details.
  

It can’t be easy to make a movie out of a book that’s 1,200 pages long, 50 years old, and is viewed with hostility by the liberals who run Hollywood. Doing so on a laughable $15 million budget makes a nearly insurmountable challenge. By all accounts, the makers of Atlas Shrugged Part I were up to it. The clips on YouTube show a movie that’s true to the book and visually stunning. Steel magnate Hank Rearden's line "My only goal is to make money" and railroad VP Dagney Taggart's showdown with a sleazy union boss are just plain fun. Patrick Humphries, of the Greater Boston Tea Party has seen pre-release screenings (twice) and told me it’s a great movie. He wrote on Facebook, “it will send shivers down your spine.” Here’s the trailer:



See the movie website for a list of theaters.

Ronald Reagan warned us that "Freedom is never more than one generation away from extinction." Please express your determination that it won't be our generation by taking part in these events. And have a great, great Patriot’s Day weekend.

Talking About Oil Subsidies

In a recent Facebook thread about the Federal budget, one of my friends said, “What puzzles me is that NO ONE seems to talk about reducing subsidies to for-profit companies that are making tons of money, such as the oil industry. Is their lobby really THAT powerful?”

West Texas Pumpjack. Public Domain photo by Eric Kounce

Ok, I'll talk about it. I did some research on how much of a dent fossil fuel tax breaks and subsidies make to the U.S. Treasury, and what efforts have been made to rein them in. Here's what I found:

The best study on the topic (or at least the best that an hour of research revealed) is Estimating U.S. Government Subsidies to Energy Sources: 2002-2008 from the Environmental Law Institute. As you can see in the graphic below, ELI calculates that the bill comes to $72.5B over the seven-year period, or $10.4B per year. This is somewhat higher than the $6.2B per year from an earlier Cato Institute study but lower than a much-cited $15.7B to $35.2B per year Greenpeace estimate. Inclusion of some defense costs as oil industry "subsidies" is responsible for the higher pricetag from the proprietors of the Rainbow Warrior. The $72.5B in the ELI study is divided between $54.2B in tax breaks (including $15.3B for the Foreign Tax Credit, which is a reasonable measure to prevent double taxation and is not specific to the fossil fuel industry) and $18.3B in bona fide subsidies.

Source: Environmental Law Institute. Click on image for expanded view.

I’ve argued elsewhere that corporations shouldn’t pay income taxes at all. That would make the whole question of tax credits for the fossil fuel industry go away. Given that we do have corporate taxes, however, they should not be used to provide preferential treatment to one industry over another; such treatment only serves to distort markets. Subsidies have a similar effect, although I should point out that about two-thirds of fossil fuel subsidies are for Low Income Home Energy Assistance and the Strategic Petroleum Reserve. I suspect that many of the people who promote a harder line on the oil and gas industry would not favor cuts to these programs.

Attempts have been made to shrink tax breaks and subsidies that benefit purveyors of fossil fuels. The leading industry group, the American Petroleum Institute, fought hard to defeat these attempts. Victory was theirs. API's political muscle is considerable; it spent over seven million dollars on lobbying in 2010. (An aside: What American politician is virtually alone in successfully standing up to the Oil and Gas Industry? Answer below.) However, industry lobbying is not the only reason for the failure of these efforts. The proposals were flawed. They sought to replace oil industry subsidies with subsidies for so-called green energy (which according to the same ELI report received $29B during the study period). As such, they were not budget cutting measures, and consequently did not receive the support of deficit hawks or of right-wing opponents of corporate welfare. This was the case for the 2007 CLEAN Energy Act (for an excellent article on this from the Cato Institute, see Oil Subsidies in the Dock by Jerry Taylor and Peter Van Doren). This is also the case for Obama’s 2012 budget, which, according to Reuters, cuts oil and gas subsidies by $3.6B (with a big chunk coming from heating oil assistance for the elderly), but adds $8B for “research, development and deployment investments in clean energy.” (Am I being too cynical in speculating that Obama is counting on Congress to restore heating oil assistance?)

So yes, plenty of people are talking about reducing subsidies to the oil industry. Trouble is, they’re saying the wrong things. They are not questioning whether the Federal Government should use its financial power to pick winners and losers in the economy. They are only arguing about who the winners and losers should be.

---

Answer to earlier question: Sarah Palin. As Governor of the Last Frontier, she battled oil industry lobbyists to pass the Alaska’s Clear and Equitable Share Act, which provides incentives to the industry for drilling while increasing the revenue to the state. See What Palin Really Did To the Oil Industry in the Wall Street Journal.

Robert Reich: "The right held the U.S. Govt hostage."

Government Shutdown – AvertedSupporting our Troops – Still a Good Cause

Last week, when a government shutdown seemed imminent, Minnesota Congresswoman Michele Bachmann wrote on Facebook, “Current law prevents our military men and women from receiving their paycheck on time if government services are interrupted. Because of this discrepancy between the pay of our troops and Members of Congress, I will personally be donating my pay to a non-profit organization serving our military families.”

Drawing by Heather Burke, winner of the Armed Services YMCA art contest

Of course, the shutdown was averted. For the time being, American soldiers, sailors, and airmen are no longer hostage to the politics. But it occurred to me that supporting them and their families is still a good cause. The volunteers of our armed forces travel to the worst hellholes on earth, eat lousy food, go without sleep, and enter harm’s way to confront armed men who hate us, all to protect our freedom. Their families must fill the gaps left by the deployment of their fathers and mothers. They must heal the wounds, physical and psychological, of those who return, and grieve for those who don’t.

They are tough, resilient people, but like all of us, they need help sometimes. Here are some organizations that can provide it:

USO

From their website, http://www.uso.org:

Thanks to your generosity, the USO fulfills its mission of lifting the spirits of America’s troops and their families. Through the USO, you touch their lives through an extensive range of programs at more than 150 centers in 27 countries, and at hundreds of entertainment events each year. Thousands of USO volunteers do everything possible to provide a home away from home for our troops and to keep them connected to the families they left behind.

The USO makes sure your help goes to those who need it the most: troops serving in combat, their families, our wounded warriors and their families, and families of the fallen.

Navy-Marine Corps Relief Society

From their website, http://www.nmcrs.org:

The mission of the Navy-Marine Corps Relief Society is to provide, in partnership with the Navy and Marine Corps, financial, educational, and other assistance to members of the Naval Services of the United States, eligible family members, and survivors when in need; and to receive and manage funds to administer these programs.

The Society provides need based financial assistance to eligible recipients in the form of:

• Interest-free loans and grants
  
• Scholarships and interest-free loans for education.
  

In addition, the Society offers the following services:

• Financial Counseling
  
• Budget for Baby Workshops
  
• Thrift Shops
  
• Visiting Nurse Services.
  

You can donate to these organizations at their websites. Please be generous with your support. Our military is certainly generous in supporting us.

Music for Sunday Night - Nancy Sinatra, Bang Bang

The Budget: Now It's Urgent

Census Bureau Cuts Threaten Seniors

In spite of the doomsday predictions from Democrats, the $61B in spending cuts in the 2011 House budget contains very little that affects the indigent or the elderly. For the complete list of cuts, see Budget Battles Begin Over Republicans Proposed $61 Billion In Cuts in Centrist Cynic's What We Should Know blog. The next biggest cuts, after the ones listed in the cartoon are (brace yourselves, poor & elderly) Department of Agriculture and Federal building funds.

The Budget Battle: What you need to know

President Obama today met with House Speaker John Boehner in an effort to reach a budget compromise prior to Friday’s impending shutdown of “non-essential” government services. Both political parties are jockeying to blame the other in the event a shutdown occurs.

Here’s what you need to know about the budget battle, condensed into two charts:

Takeaways:

1. Both federal spending and the federal deficit have grown significantly under the Obama administration.

2. Without cuts in defense, Social Security, or Medicare, or increases in revenue, you could shut down the rest of the government and still have a deficit.