Beyond Stage One Politics

Carolyn Phippen

Two weeks ago, Paul Krugman was calling for a fake alien invasion to stimulate our economy. I think he’s almost gotten his wish.

Estimates of damage from Hurricane Irene range anywhere from $13 billion to $45 billion. Think of all the jobs that will need to be filled. Better yet, much of the work that needs to be done will be paid for with borrowed government funds – it’s a Keynesian’s dream.

Rebuilding should keep people busy for a little while, and when they’re done up North they can head down to Mississippi and help the rebuilding effort still going on down there, six short years after Hurricane Katrina.

Of course, this is the same Paul Krugman who suggested that in order to replace the Nasdaq bubble of the late 1990s, “Alan Greenspan needs to create a housing bubble.” He saw this as the solution to the lack of corporate spending; “soaring household spending” was, to him, the answer. In other words, moving money around in the economy by creating artificial growth.

In fact, the White House is now defending the idea that government transfers through extended unemployment insurance actually lead to growth. The assumption is that without those transfers, no money would be spent by unemployed individuals and with the transfers, no incentives for less productive behavior are taking place. If both of those things were true, the Obama economic policy might be preferable to nothing. Unfortunately for Team Obama, they’re not.

According to Alan Krueger, Obama’s newly-appointed economic advisor, extended unemployment benefits (wealth transfers) increase length of unemployment and can lead to more layoffs. Studies have shown that the closer one is to the cut-off point for benefits, the longer time spent actually looking for a job.

As far as the White House’s claim that each dollar in unemployment benefits spending leads to $1.73 in short-term economic growth, false assumptions are made which equate each dollar in benefits with one dollar spent. For every dollar in additional unemployment benefits, only $.55 actually makes it into the economy because individuals tend to reduce their reliance on their own savings if the government will pay them and for married individuals, spouses tend to reduce hours worked when benefits are increased.

The past three years have shown us Paul Krugman and the left’s version of economic growth – government jobs, government “investment” and government wealth transfers with weak economic growth and stubbornly high unemployment (but hey, we’ll all have that “free” healthcare soon!). Forget business investment, product development, innovation, increased efficiency; no, this moving money around thing is just working so well.

See my article about the national debt published in August 2011’s edition of Smart Girl Nation, entitled President Obama’s Bank of China.

What is with the hysteria surrounding the debt limit? Why are the Democrats refusing to have a discussion regarding the issues surrounding the debt ceiling and fiscal austerity?

It is a fact that all things being equal, a growing economy brings in more taxes than a stagnant or shrinking one. It is a fact that reducing tax rates stimulates growth and leads to greater tax receipts (courtesy John F. Kennedy). It is a fact that we cannot continue on the current path of fiscal irresponsibility (courtesy Barack Obama).

If we want our federal government to have access to more money (I’m not sure I do), then reducing taxes to a point where optimum growth will occur is the best way to achieve that goal, not raising the debt ceiling so we can borrow more every time we max out the national credit card. I concur with John F. Kennedy,

Our practical choice is not between a tax-cut deficit and budgetary surplus. It is between two kinds of deficits: a chronic deficit of inertia, as the unwanted result of inadequate revenues and a restricted economy; or a temporary deficit of transition, resulting from a tax cut designed to boost the economy, increase tax revenues, and achieve . . . a budget surplus.

The next step would be to get spending in line. We all know that no matter how much money the treasury has, it spends more. Tax rates could be raised to 90%, 100% even, and not only would our federal government spend every dime of it, but they would certainly borrow against it to finance even more great projects to buy votes . . . ah, rather, to serve the people. I recently wrote about the idiocy of such a plan, entitled The Rich, Taxes, and Government Debt.

The most powerful tool of the politician has become our tax dollars. Our money, taken by the force of law, is spent to buy votes and power, and often in ways that work against the interests of those paying the bill. It only seems fair (the President’s ears should perk right up now) that those who are going to be on the line for this new spending (taxpayers) have the right to require some fiscal responsibility from those doing the spending.

President Barack Obama, in May of 2009, warned that the current level of deficit spending was unsustainable and would lead to skyrocketing interest rates for Americans and have a “dampening effect on our economy.” Of course, that was when it was George Bush’s spending.

Thank goodness we (or some of you, rather) elected a fiscally responsible president; one who did more deficit spending in his first three years in office than all presidents before him combined; one whose budget proposals will not only double our national debt within the next decade, but quadruple the net interest costs of carrying that debt (as a result of those increased interest rates, coupled with increased debt); one whose tax and spend philosophy will cause us to spend more money on interest payments than on “education, roads and all other nondefense discretionary spending combined” within eight years. Yet each year in office he has preached the virtues and necessity of decreased federal spending – 2009, 2010, and again in 2011 – and despite the soothing words, reality bears out a less than soothing picture.

According to budget analysis, “90 percent of the rising long-term budget deficits are driven by rising spending, and just 10 percent of the rising deficits are caused by falling revenues” and our President has admitted that our federal government has a spending problem, yet he is asking Congress for an increased ability to borrow without any limitations on their (and his) ability to continue spending recklessly.

How about this:

In the 1980s and 1990s, Washington consistently spent $21,000 per household (adjusted for inflation). Simply returning to that level would balance the budget by 2012 without any tax hikes. Alternatively, returning to the $25,000 per household level (adjusted for inflation) that Washington spent before the current recession would likely balance the budget by 2019 without any tax hikes.

Simple, really, and the easy part is the President claims to already agree with me.

Just this week James Cameron backed out of a debate with Ann McElhinney, producer of the movie Not Evil, Just Wrong, which counters the error-riddled An Inconvenient Truth. Cameron is that Hollywood producer and environmentalist who is so committed to the sustainable lifestyle that he lives it when he can and only lives an energy-devouring lifestyle “because of Jim’s job” according to his wife.

Cameron had recently expressed a desire to “call those deniers out into the street at high noon and shoot it out with those boneheads.” In a move that appears to have been unexpected, his offer was accepted and a debate scheduled; Cameron and two scientists v. McElhinney, Marc Morano, and Andrew Breitbart. According to McElhinney:

But then as the debate approached James Cameron’s side started changing the rules.

They wanted to change their team. We agreed.

They wanted to change the format to less of a debate—to “a roundtable”. We agreed.

Then they wanted to ban our cameras from the debate. We could have access to their footage. We agreed.

Bizarrely, for a brief while, the worlds most successful film maker suggested that no cameras should be allowed-that sound only should be recorded. We agreed

Then finally James Cameron . . . decided to ban the media from the shoot out.

He even wanted to ban the public. . . .

No media would be allowed and there would be no streaming on the internet. No one would be allowed to record it in any way.

We all agreed to that.

And then, yesterday, just one day before the debate, his representatives sent an email that Mr. “shoot it out ” Cameron no longer wanted to take part.

At the American Renewable Energy Day summit where the debate was to take place, “Cameron and a host of other climate-change activists said there needs to be a broad educational campaign, one aimed at convincing voters and politicians that not being able to prove that fossil fuel-produced carbon is changing the temperature of Earth is not a license for inaction” (italics added).

Could that be the reason the debate was cancelled? Could it be that the “consensus” which has been so often used to end all debate might not be quite what we’ve been told? (Remember this consensus I wrote about recently where Jared Bernstein defended the Obama administration and their claim that unemployment wouldn’t exceed 8% with the stimulus by claiming that the consensus estimated top rate of unemployment was 8%, ostensibly even without the stimulus? Consensus was apparently enough to give them cover for being wrong.)

Add to that the controversy last year when Al Gore and Lord Monckton were both to appear and jointly testify before Congress about the Waxman-Markey climate legislation. This legislation would have the grand effect, according to the computer modeling used by consensus scientists, of pushing off the inevitable climate catastrophe by 2-5 years; it would decrease our estimated temperature by 0.05°C over the next 50 years while destroying our economy. Gore, friend of the Democrats controlling Congress, was allowed to testify, but Monckton was told he couldn’t. Gore allegedly wasn’t interested in appearing in a forum where his ideas could be challenged.

Christopher Monckton has asked that Gore debate him on the climate change issue for many years, without any response from the former vice president.

This is all starting to make sense: our President thinks we all have access to “too much information” in our search for truth – he recommends we stick to The Huffington Post; Nancy Pelosi wants to investigate funding of groups that actually believe they have the right to vocalize disagreement with issues supported by her (after the firestorm that statement created, she agreed that maybe we should be investigating both sides); and those who want to decimate our way of life based on unsubstantiated claims (over 80% reduction in greenhouse gas emissions for a 0.05 C decrease, really?) are unwilling to put their ideas out there side by side with those who disagree with them.

Am I the only one seeing a pattern here?

Reformation period art had two consistent characteristics in its illustration of the believers.  Catholics were portrayed holding rosaries, while Lutherans were shown holding books, usually Bibles.

The struggle for power is always a struggle of those who desire their power through our ignorance v. those who seek the empowerment of all through education, enlightenment, and consequently, freedom.  In our day, a new reformation is underway; we can choose to allow those with power to take even more through our ignorance and their empty promises which can never really be, or we can become empowered by seeking, learning, questioning, and thinking.

When I was young, a book was published that was not only vitriolically critical of my religion, but full of half-truths and flat out lies.  Churches of different faiths in my hometown were holding meetings to talk about the book, show a movie based on it, and basically sit around bashing this religion they didn’t agree with.

One day I came across this book in my home.  I was only 11 or 12, and I went to my mother and asked if I could read it.  Her response was that I could, but she had me commit to read my scriptures diligently during the period of time I was reading the book, and she in fact gave me specific guidelines for my own study to ensure my exposure to the whole story.

My parents weren’t afraid of me being exposed to lies, half-truths, and criticisms; they knew where the truth lay, and they had confidence in my ability to find it as long as I had both sides of the discussion in front of me.  They knew that to shield me from discussion and debate about things they didn’t agree with or knew to be untrue would only serve to weaken me intellectually and spiritually.

I know it’s human nature to be so wrapped up in one’s opinions and ideas that we refuse to acknowledge anything on the other side.  I think it’s probably even human nature to want to shut up those on the other side of the discussion, as our president seems truly pained to not be able to do (although he and many of his associates have given it a good try).  It could even be human nature to want to call names, try to demean and discredit, and essentially attempt to undermine those who disagree with us without even addressing our real issues of divergence.

There is, though, danger in this approach.

When our opposition is founded on anything other than truth and its principles, we falter.   We become fearful of others being “bombard[ed] with all kinds of content,” and being exposed to “all kinds of arguments.”  We shouldn’t fear those arguments, even if we feel they “don’t always rank that high on the truth meter.” Since when, in America, did too much information become something other than a “means of emancipation?” (I know he said epancipation, but I’m trying to not distract from the issue at hand.)

Too many are fooled by platforms founded on lies because they’ve never been exposed to anything other than those lies.   Those who’ve not developed the ability to adequately and systematically reason through real and complicated issues can be fooled by one promising the most lavish benefits, or one who places all the blame for everything wrong in your life on the other guy (guilty or not), or one who screams the loudest and tells you that progress is achieved by undermining the building blocks of the most successful society in human history.

I’m trying to figure out what is so scary that our president and so many around him have been systematically working to undermine the free exchange of ideas and attempting to shut down opposition.  Remember, if truth is on your side there is nothing to fear.  Why so afraid?

While listening to an interview with Joe Biden’s chief economic advisor, Jared Bernstein, I heard what sounded like an admission that the White House hadn’t necessarily expected the stimulus bill to hold unemployment at a rate any lower than was already the “consensus” estimated rate.  Larry Kudlow, on The Kudlow Report, asked Bernstein about the promise made by the White House that if the stimulus bill were passed quickly, the unemployment rate would not exceed 8%;  it currently stands around 9.6%.

Mr. Bernstein responded by saying that during the fourth quarter of 2008, the consensus was that 8% would be the height of unemployment in this country.  He went on to say, “We were right with the central forecast.  We did not know that the, nor did any other, hardly any other economists, that the unemployment rate was headed up so quickly, that the economy was headed off a cliff . . .”

Okay, I get it.  You spoke before you realized the extent of the recession, and hey, who knew a consensus could be wrong, right?

But wait, Obama wasn’t yet in office in the fourth quarter of 2008.  The president had not at that time even submitted a stimulus plan to be considered by those formulating the “consensus,” had he?

I’ve attempted to contact the White House to for clarification; I’ve rewound my TiVo and watched it again; I’ve emailed The Kudlow Report to see if they can get clarification.  If this administration made a promise to us that unemployment wouldn’t exceed the level they now claim was the “consensus”  maximum even before a stimulus bill, if we would only spend over $800 billion, then we all just got shafted.

Not only did unemployment far exceed the promised 8% maximum, but I can only assume the administration didn’t  have much confidence in the effectiveness of their own bill, the one that just had to be passed right now!  If they did believe it would actually “create or save” a significant number of jobs, it only makes sense that they would have taken the consensus peak unemployment rate and reduced it by the percentage of jobs they planned on saving or creating.  I understand, though, not wanting to overpromise.

On the other hand, the fact that they took the consensus peak and assured us their $860 billion bill to reduce unemployment would keep us below that already assumed high, and then it still didn’t, doesn’t bode well for all of us who weren’t close enough to the administration to get our own big fat stimulus check.  Nor does it bode well for our children and grandchildren, who will be paying for those checks for years to come.

Watch the video here (the portion I reference starts right around 6:10 if you don’t want to watch the full 12 minutes):

So, 36% of the American public thinks Obama is doing a good job on the deficit. In fact, 23% didn’t think the stimulus package added to the deficit at all. That level of miseducation is astounding to anyone even the slightest bit economically informed. The federal deficit for the 2010 budget is projected to be 10.6% of GDP, with an expected increase even higher next year. This, even though according to our President, we’re in the middle of recovery.

Federal discretionary spending increased over 80% from 2008 to 2010, thus resetting the baseline at an extraordinarily high level. Every new budget going forward starts at that point and goes upward from there; any reductions are considered cuts – something that almost never happens in Washington. What does tend to happen is that spending will increase each year, thus ensuring greater and greater deficits, and an exploding national debt as far as the eye can see.

Deficits under George W. Bush were in the 1-3.5% range until 2009, for which President Bush and President Obama were both responsible. Most of us believed spending was out of control under Bush, only exacerbated by the $800 billion (ten year) price tag on Medicare Part D.

President Clinton was elected to his first term in office with a minority of the popular vote, which had been split by Ross Perot with 19%. What was the issue that so divided fiscal conservatives and was the basis of Perot’s campaign? Concern over a deficit of approximately 4% of GDP.

A quick review of articles written during the Bush administration attests to the fact that liberals have been consistently concerned with out-of-control deficits during periods of time when they’ve been a fraction of what they currently are. I certainly hope this concern is genuine rather than political and we’ll soon see wide-ranging support for massive spending cuts in order to meet the historically consistent level of spending at 18-20% of GDP.

Politicians from both parties have been selling out the future of our country in order to buy votes in the here and now, and the rest of us just can’t afford this party any more.

In The Battle, Arthur C. Brooks outlines a consistent 70/30 split among the American population. That is pretty much what we see in this support for current policies dealing with budget and spending issues.

Nearly 70% of Americans agree that they’re better off in a free market economy than not, “despite its severe ups and downs.” Fifty-six percent of Americans believe their income taxes are too high, while 33% believe they’re just right. Astoundingly, while many Americans believe that the rich should pay more taxes, 69% believe that the top tax rate should be 20% or lower! Seventy-six percent believe the strength of America is based on the success of American business and 66% believe that when “big business” earns a profit it helps the economy; alternately, 18% believe it hurts (where did they go to school?) When asked if they would prefer larger government with more services and higher taxes or smaller government with fewer services and lower taxes, only 21% of Americans chose larger, more expensive government while 69% preferred smaller.*

There is a minority of the population, the 30%, who will, due to lack of understanding or pure ideological drive, charge ahead in attempts to completely redefine and transform this nation of freedom and wealth which was unimaginable in the world just a few centuries ago. It is the rest of us, the 70%, the mainstream of America, who stand in their way. It’s time for the politicians to represent us.

(Polling data excerpted from The Battle by Arthur C. Brooks, Basic Books, 2010, pp. 3-12)

by Carolyn Day

Our President, in his State of the Union speech, expressed concern about the recent Supreme Court decision which “will open the floodgates for special interests – including foreign corporations – to spend without limit in our elections. ”

I find it to be a positive sign that he’s concerned about contributions from foreigners and spending limits on election campaigns. After all, his own campaign accepted a reported $29,000 from two men in the Palestinian-controlled Gaza strip during the campaign and investigations uncovered donations from nearly 70 other countries, with no verification process in place to determine if the contributors were American citizens or foreigners.

While our president is concerned that corporations could potentially “spend without limit,” his campaign didn’t seem to be nearly as concerned about individuals spending without limit, in violation of existing federal law. The systems that McCain’s campaign had in place to verify donor’s identities and addresses and reject those that couldn’t be verified, were apparently nonexistent in the Obama campaign. There were numerous documented instances of individuals making small donations 20 or 30 times in one day in amounts that in some cases totaled up to $10,000.

So, while it is still illegal for unions and corporations to make contributions to individual politicians, they’ve been placed on somewhat more equal footing with American citizens. Maybe instead of getting all worked up about the Supreme Court, we could focus just a little more attention on the laws still in place to ensure the money raised for the upcoming elections in November is actually legitimate this time around.

by Carolyn Day

In his State of the Union address last night, President Obama echoed earlier statements he’s made regarding the failure of a health care reform bill thus far in his administration. He reiterated his belief that the reason Congress has been unsuccessful in garnering more public support for the bill is that the administration hasn’t done an adequate job of explaining it to the American people.

Congress and this administration have done everything they possibly can to keep the details of the legislation from the American people, including burying them in a 1,000 – 2,000 page bill (House, Senate). According to David Axelrod, “And people will never know what’s in that bill until we pass it, the president signs it, and they have a whole range of new protections they never had before.”

The American people want the information up front and they want discussion and debate. Let’s be real – the beauty of 60 votes in the Senate was that the Democrats could avoid all debate.

According to our president, “[Disagreements] are the very essence of our democracy.” If he firmly believes this then it’s time to have a discussion based on the disagreements the majority of Americans have with his health care reform policies.

Stop treating us like children (“we know what’s best for you,” “you’ll appreciate it once you have it”) and start acting like the servants of the American people we’ve elected you to be.

by Carolyn Day

We all know by now that Scott Brown, a Republican, won in the Massachusetts special election Tuesday. According to a Rasmussen poll, 56% of MA voters said health care was their top issue. In another poll by Fabrizio, McLaughlin & Associates, 78% of Brown voters said their vote was meant to stop Obamacare.

This is about as clear a message as the American people can send. Between now and November, the administration and Congress will have the opportunity to get out in front of this and bow to the will of the American people who elected them; this is their warning. The alternative would be to simply continue to ram their platform down the throats of a disgusted populace that isn’t willing to take it anymore, and to pay the price come November.

According to a story in the Huffington Post,

“This needs to be a wake up call that people are still demanding change,” Joe Trippi, a longtime party strategist and high-ranking official on the Howard Dean and John Edwards campaigns told the Huffington Post. “I don’t think it is ideological, I don’t think it is left versus right. I think it is outsider versus insider. It is the new way versus people doing it the old way. That is still the carryover from 2008. And whether the Obama administration recognizes that is important. This is a wake up call that they can’t play the inside game.”

“The most important thing is for Democrats to acknowledge that they need to change course and then to change course,” said Simon Rosenberg, a former Clinton administration official and head of the Democratic group NDN. “They must acknowledge it has not been a good first year and they have to change.”

According to President Obama, “the same thing that swept Scott Brown into office swept me into office. People are angry and they’re frustrated.”

People are angry, people are frustrated; this president still hasn’t adequately addressed the anger and frustration that existed when they elected him. Exit polls from the presidential election show that two of three voters cited the economy as their chief concern, while fewer than 10% mentioned healthcare. To say that the latest election was about change is correct, but if the message being sent by the voters is misinterpreted by the politicians, then the slaughter in November will be of astronomical proportions.

American voters are realizing that the amorphous idea of change many of them voted for in the last presidential election is worthless if not founded upon the principles of this republic.

A year ago Americans wanted change. The greatest economic system the world has ever seen was on the verge of collapse, unemployment and foreclosure rates were skyrocketing, and continuing deaths of American soldiers in a war that we were consistently told was unwinnable all converged to instill in many Americans the desire for change – no questions asked.

A new day was ushered in. Unfortunately for the ruling classes in Washington, now that voters understand just what this encompasses, they seem to prefer something else; maybe anything else.

President Obama says that if there’s one thing that he regrets this year it is that they “were so busy just getting stuff done and dealing with the immediate crises that were in front of us that I think we lost some of that sense of, of, you know, speaking directly to the American people about what their core values are.”

I’m glad he’s noticed that our core values have been missing in all the talk he’s has been doing over this past year. The president gave 411 speeches, 42 news conferences, and 158 interviews in one year and of course he failed to adequately talk about our core values – that would undermine his agenda.

If the legislation this administration and Congress are trying so hard to pass actually encompassed those values, so much talk would be unnecessary. The problem is that their agenda isn’t based on the values held dear by a majority of the American people. This administration was so busy “fundamentally transforming the United States of America” that they failed to notice that we noticed.