Tuesday, July 31, 2012

Eat Mor Chikin

On a serious note, join us in supporting the executives, franchise owners and more than 61,000 employees of Chick-fil-A for their Christian business practices, as well as their stated support for biblical values, which is to say traditional American family values. Sign the letter today! (link)


Have some chikin tomorrow!

Thursday, July 26, 2012

A Blistering Treatise On Entitlement

It's not only necessary for consideration of any responsible adult concerned about what's going on in America today, but it's also a thing of beauty:

Tuesday, July 24, 2012

You Didn't Build That

I had to post at least something on this because it may very well turn out to be one of the pivotal moments of the 2012 campaign.  Here's what started it:

Hm, okay.  This is reminiscent of his "spread the wealth around" statement in 2008 in that it really pulls back the covers of what Barack Obama truly believes about America and how it works.  Mainly, that it isn't about what an individual chooses to do, what an individual works hard to accomplish, or what an individual earns for himself or herself, but rather it's about the collective.  This is the fundamental difference we've examined many times before between the equality of outcomes versus the equality of opportunity.  And yes, it is a big difference:

This ad is subdued in its tone, but the message is an all-out assault on the socialist/Marxist tendencies of Obama, and it resonates with the American spirit that still exists in so many people.  The Obama campaign's response to this bulls-eye is that his statement was "taken out of context":

Out of context?  Really?

Even if we grant that he's talking about the building of roads and bridges (which is a subjective grant at best), the logic still isn't there.  If building roads and bridges were what made businesses successful, why would any business located next to a road fail?  Similarly, if all it took to make a successful business was a road or bridge, why isn't the government out there building hundreds of new roads and bridges into the vast stretches of undeveloped land in this country in order to stimulate the economy?  And where did the government get the money to build those roads and bridges in the first place?  From the taxpayers, or, in other words, from the people running businesses.  Americans were building successful businesses all over the nation before the government started making paved roads and fancy bridges.  This backtrack is absolutely ridiculous, and anyone who understands business understands that.  Here's how Mitt Romney described it:

Kind of hard to see how he took it out of context, don't you think?

And Romney's right about the bottom line, too.  It does take a lot of people to help get a business off the ground and on its way, but it's not about the collective and the state - it's about the people who own and manage that business, using their God-given talents as well as skills and knowledge learned from those teachers and other mentors throughout life to make it all work.

Watch this one.  I think it could be significant in November.

Here are a couple of bonus videos to more fully flesh things out.  If you want to see the Obama campaign's full (nonsensical) video response, check out this video:

Here's Hot Air's on-the-spot analysis of one of the key lines:

The other money line from Ms. Cutter, however, ran thusly: “Apart from the flagrant hypocrisy, these attack ads make you wonder: Does he even understand how our economy works? We build our businesses through hard work and initiative with public and private sectors working together to create a climate that helps us grow. President Obama knows that.” Wow. I can’t fathom why they’re so eager to invite such obvious counter-punches, but here it is — President Obama’s policies have been running this economy for well over three years, and it is still in shambles. In fact, practically every indicator is currently heralding the United States’ decline back into recession, and no amount of “headwinds” or “inherited problems” is going to help Obama save face on that one. 
Americans are hurting, and despite all of the Obama campaign’s attacks against Romney’s business record, it’s getting less easy to convince them that Obama is an effective steward of the economy. These days, with all of our big-government rules and regulations, it feels like the private sector is more often fighting the public sector for survival than working with it, and President Obama’s solutions always seem to involve more government.

The bottom line is that these statements aren't gaffes...they're insights into the radical Leftist ideology that's fueling Barack Obama and his minions.

Ode To Bacon

Just because bacon rocks...

Bacon is red,
Violets are blue,
Poetry is hard,

(hat tip to Jordan for the outstanding poem)

Tuesday, July 17, 2012

Um...Who's Being Obstructionist?

I'll give you three guesses, none of which will be needed (emphasis mine):

Democrats say they'll let all the Bush-era tax cuts expire if they can't raise taxes on the rich. Apparently, economic catastrophe is a reasonable price to pay for class warfare politics.

On Monday, Sen. Patty Murray, who heads the Democratic Senatorial Campaign Committee, said that "unless Republicans end their commitment to protecting the rich above all else, our country is going to have to face the consequences of Republican intransigence."

What she really means is Democratic intransigence.

After all, Republicans have taken the perfectly reasonable position that the last thing you want to do when the economy is barely breathing is raise taxes.

Obama himself once made that argument, at a time when the economy was doing better than it is today. And a few level-headed Senate Democrats agree.

Yet now, faced with a tough re-election and desperate to score political points, Obama says he'll veto any bill that extends all the Bush tax cuts, and Democrats, as evidenced by Murray's comments, are falling in line.

Should Obama make good on this threat, the risks to the economy would be enormous. Tax rates on everyone would climb back to Clinton-era levels, which translates into a tax hike of roughly $150 billion next year alone.

And that, in turn, will cut economic growth by as much as 3% next year, according to the Congressional Budget Office, and quite possibly plunge the country back into another recession.

Democrats claim this threat is worth it to make Republicans toe the line. After all, raising taxes on the rich is all about fairness and fiscal responsibility.

But in reality, it has nothing do with either.

Today, the top 1% of income earners pays 37% of all federal income taxes, far more than their 17% share of the nation's income. The bottom half, meanwhile, pays just 2% of all income taxes, although they account for 13% of the nation's income, according to IRS data.

What's more, the share paid by the rich is higher today than it was when Bush took office, when it was 34%.

How is this not fair?

And while Obama claims that the nation "can't afford" Bush's cuts for the rich, and that these "are a major driver of our deficit," that, too, is poppycock.

The most "expensive" parts of the Bush tax cut — to use the misleading Washington parlance — were those benefitting the middle class, which accounted for the vast bulk of the Bush tax package.

And raising the top two tax brackets to Clinton-era levels — as Obama proposes — will do nothing to ameliorate the nation's ongoing fiscal crisis. At best, it would trim the 10-year deficit by a mere 8%, and that's assuming the rich don't take steps to avoid the higher taxes.

What Obama's tax plan will do — by his own admission — is hit some 900,000 small businesses with a tax hike, cutting their ability to invest, grow and hire.

In other words, Obama and his Democratic allies are pointing a gun at the economy and threatening to pull the trigger unless they get a tax hike that will itself hurt economic growth. All in an attempt to portray Republicans as the party of the rich.

So much for hope and change.


In completely unrelated news, more Americans are now going on disability (i.e. yet another government welfare program) than are getting jobs.

Obamanomics in action.

PS - no, I don't think everyone who is on disability is a government leech.  It's a fine and worthy program...BUT...we need to be extremely careful of who gets on it.  I've read reports more than once suspecting (though I haven't seen it actually proven yet) that when the 99 weeks of unemployment 'insurance' runs out, government bureaucrats generally put people onto disability to keep them on the government dime even if they're not actually disabled.  That is inexcusable.

Monday, July 16, 2012

Another Perfect Encapsulation Of Liberalism

This time in higher education:

Last week, the Obama Administration issued new regulations broadening Title IX of the Higher Education Act—the part of law barring sex-based discrimination in education programs typically associated with high school and college sports—to explicitly include science, technology, engineering, and mathematics (STEM) education.

As many commentators have noted, this new policy could effectively create science quotas and once again shows that the Administration is focused on equality of outcomes, not equality of opportunity. As Charlotte Allen notes over at Minding the Campus:

When college women study science, they tend to gravitate toward biology—about 58 percent of all bachelor's, master's, and doctoral degrees in biology go to women. In contrast, women earn some 17 percent of bachelor's degrees in engineering and computer science and just over 40 percent of bachelor's degrees in physical sciences and mathematics. The likely reason for this, found in the study "The Mathematics of Sex" (2009) by Cornell psychologists Stephen J. Ceci and Wendy M. Williams, is that women tend to be drawn to "organic" fields involving people and living things, whereas men are more interested in the objects and abstractions that are the focus of STEM majors.

Yet the Obama administration sticks closely to the hard-line feminist argument that the problem is bias: women are somehow being denied access to STEM courses.

As Hans Bader of the Competitive Enterprise Institute notes, existing Title IX regulations have restricted the number of men participating in sports to the overall percentage of men that make up the student body, which has limited sports options for men at universities. Carrie Lukas of the Independent Women's Forum (IWF) echoes that analysis:

As a result, while Title IX succeeded in creating opportunities for women, it has also robbed men of similar opportunities.…

Title IX has contributed to the elimination of scores of men's athletic teams (commonly baseball, wrestling, gymnastics, track and field, swimming, and crew) and the near extinction of some sports (like gymnastics) for men at the college level.

While women are underrepresented in some academic areas, they are also overrepresented in others. And if the Administration's new Title IX guidance were applied evenly, opportunities for women in other fields would be limited. But as education researcher Joanne Jacobs notes, "don't hold your breath waiting for Title IX enforcers to crack down on college English departments."

Could there be any worse way to ensure access to science education? Pulling down men to alleviate a nonexistent problem plaguing women is surely no way to improve academic opportunity for everyone.

As Allen concludes

: "The use of Title IX to force universities to restructure their curricula and alter the composition of their hard-science and engineering departments in order to achieve a supposed gender equity that matches neither the aptitudes nor the interests of many women isn't just heavy-handed and totalitarian. As study after study indicates, it's bad science as well." And as IWF's Sabrina Schaeffer writes:

Before we look to broaden the parameters of Title IX, we ought to give serious thought to the question: Is gender parity in the sciences really necessary in order to have gender equality? Can we accept that men and women see the world differently and choose to engage in different disciplines? Perhaps then we can finally value the differences men and women each bring to the table.

Fifty-seven percent of students enrolling in college in 2010 were women, the same year that women surpassed men for the first time in doctoral degrees earned. Moreover, the coming higher education revolution, which is harnessing the power of online options to bring down costs and improve access, will have a far greater impact on ensuring that everyone has access to educational opportunity than the Administration's top-down regulations ever will.

I think there are two key points here.  First is that liberalism seeks equality of outcomes rather than equality of opportunity.  There's a big difference.  For example, could it be possible that men and women are wired differently, and when looking at large numbers of male/female populations, they have definite tendencies and preferences?  Could it possibly be that women want to study things like biology and English more than men, and that men want to study things like engineering and computers more than women?  Common sense says unequivocally yes, and yet this simple reality never fails to shock liberals.  So, step one is that there really is no problem here.  The equality of opportunity is assured, but equality of outcomes isn't necessary.

Point number two is an expansion of that last sentence - not only is equality of outcome not necessary, but it is destructive.  The only way to achieve an equality of outcomes is by destroying one group to benefit the other.  Sure, women now have access to more athletic programs, but it was achieved at the cost of eliminating men's athletic programs.  Once again, consult your common sense: in a huge group of millions of people, who's more likely to want to engage in sports at the college level, men or women?  No one outside of liberal circles would ever think it's a 50/50 split (and I'll bet you couldn't find a single coed college or university that gets the lion's share of its funding through women's athletics...just sayin'...).  And yet, liberals seem to think that that is the only definition of what's "fair".

So, when you really cut to the core, this notion of "fairness" -- i.e. equality of outcomes rather than equality of opportunities -- equates to unfairness in the favor of whoever liberals think deserves it most.

Friday, July 13, 2012

Speaking Of Lawlessness And Dependency...

...Emperor Obama strikes again:

Not content to stop at rewriting immigration policy, education policy and energy policy, yesterday, President Obama's Department of Health and Human Services (HHS) released an official policy directive rewriting the welfare reform law of 1996. The new policy guts the federal work requirements that were the foundation of the Clinton-era reform.

Basically, the new Obama policy waives the requirement that people on welfare attempt to look for jobs.  That's right...now you don't even have to worry about the bothersome detail of filling out a couple of job applications per week in order to cash your government check.  This is a big, big deal, and it went essentially unreported.

As if the surface issue isn't troublesome enough, a deeper dig reveals even more:

Welfare reform replaced the old Aid to Families with Dependent Children with a new program, Temporary Assistance for Needy Families (TANF). ... The whole point was that able-bodied adults should be required to work or prepare for work as a condition of receiving welfare aid.

This reform was very successful.

TANF became the only welfare program (out of more than 70) that promoted greater self-reliance. It moved 2.8 million families off the welfare rolls and into jobs so that they were providing for themselves. Child poverty fell, and single-parent employment rose. Recipients were required to perform at least 20–30 hours per week of work or job preparation activities in exchange for the cash benefit.

Now, Obama's HHS is claiming that it can waive those work requirements that are at the heart of the law, and without Congress's consent.

When it established TANF, Congress deliberately exempted or shielded nearly all of the TANF program from waiver authority. They explicitly did not want the law to be rewritten at the whim of HHS bureaucrats. In a December 2001, the non-partisan Congressional Research Service clarified that there was no authority to override work and other major requirements: "Effectively, there are no TANF waivers," it reported.

But that did not stop the Obama Administration, which has been increasing welfare spending at an alarming rate already. President Obama has added millions to the welfare rolls, and his Administration has come under fire lately for its efforts to expand and add more Americans to the food stamp program.

It's not like it was particularly burdensome before...

In the past, state bureaucrats have attempted to define activities such as hula dancing, attending Weight Watchers, and bed rest as "work." These dodges were blocked by the federal work standards. Now that the Obama Administration has abolished those standards, we can expect "work" in the TANF program to mean anything but work. The new welfare dictate issued by the Obama Administration clearly guts the law.

...but even that was apparently too stringent, so Obama waived all requirements whatsoever.  The bottom line:

While the 1996 welfare reform successfully moved people from welfare into work, it did not "end welfare as we know it." Now, however, the Obama Administration has ended welfare reform as we know it. The President cannot hide his disastrous unemployment record by depriving Americans of the hope of a job. He should immediately reverse this course, and offer constructive ideas for economic growth rather than government dependence.

Again, I ask you: can there be any doubt whatsoever that Obama's intention is to actively put as many people as possible into dependence upon the government?


You just can't make this stuff up:

The government has been targeting Spanish speakers with radio “novelas” promoting food stamp usage as part of a stated mission to increase participation in the Supplemental Nutrition Assistance Program (SNAP), or food stamps.
Each novela, comprising a 10-part series called “PARQUE ALEGRIA,” or “HOPE PARK,” presents a semi-dramatic scenario involving characters convincing others to get on food stamps, or explaining how much healthier it is to be on food stamps.
The majority of the episodes end with the announcer encouraging the listener to tune in again to see if the skeptic applies for benefits or learns to understand the importance of food stamps to their health.

Problem 1: everyone knows America is in the throes of economic problems.  Is this really the best use of taxpayer dollars?  To advertise for food stamps??  Can there be any better illustration of how Obama and liberals like him want to cause more people to become dependent upon government for everything, even the most basic necessities of life?

Problem 2: in Spanish?  I mean, come on.  Isn't this a bit of a slap in the face to Hispanics?  It's basically saying that they're all incapable of taking care of themselves and thus need to rely on the government for sustenance, and that's simply not true.  Also, the entire premise of a soap opera geared solely toward building dependency on food stamps seems really...well, insulting.  Do they really think Hispanics are this shallow and gullible?  Or is this just another shameless political ploy to illegal immigrants to join up and support him at the polls?  Never mind Obama granting millions of them de facto amnesty all by himself -- just months after publicly stating that that was unconstitutional -- I guess he felt like he needed to go one step further and get them not only in the country but also living comfortably on the taxpayer's dime (despite most Americans being firmly against his immigration policies).

But this is how liberals view everyone: as helpless victims who can't do anything for themselves, and thus they need the government to do everything for them.  That's completely untrue, but that's how they view things.

Another great example is the reaction to Mitt Romney's speech to the NAACP  earlier in the week.  His full speech is here:

It's about 24 minutes long, but the first three minutes will give you a great flavor of the whole thing.  Notice the lackluster applause when Romney talks about raising up the middle class and those who need jobs.  It's there, but hardly enthusiastic.  I find it interesting how he lays out a whole bunch of numbers that show how the African American community is suffering worse than everyone else in an effort to show that equality of opportunity isn't what's being delivered by the Obama administration.  It gets really interesting at about 11:30, when he promises to repeal Obamacare.  The crowd boos, but Romney rallies to explain the bottom line: jobs.  Obama isn't providing them, but he can.  From the reaction of the crowd, however, it's not all that clear whether the NAACP wants them or not.  Jump in there and watch...it's a shockingly effective expository explanation from a Republican.

Oh, and by the way...Obama didn't have time for the NAACP, so he sent VP Joe Biden instead.  I guess he feels like he doesn't need to worry about the votes of African Americans, and he may be right to think that, but even die-hard liberals are questioning the decision.  Of course, all those numbers Romney laid out about the extra steep slope for African Americans isn't making it much easier to appear before them, either.

But neither the NAACP nor the liberal punditry liked Romney's speech.  They called it insulting and demeaning, pointed out that it was negatively received, and (naturally) racist.  Charlette Stoker Manning, the Chairwoman of Women in the NAACP, said this:
"I believe his vested interests are in white Americans," ... "You cannot possibly talk about jobs for black people at the level he's coming from. He's talking about entrepreneurship, savings accounts — black people can barely find a way to get back and forth from work."
Um...call me crazy, but she sure doesn't have much of an opinion of black people's abilities to excel, create businesses, and succeed, does she?

The bottom line here is that the majority of this crowd has been so thoroughly entrenched in liberal government largesse and dependency for so long that when a candidate comes in and talks to them as responsible adults capable of independent thought and genuine achievement, they can't handle it.  They reject it out of hand due to the letter behind the candidate's name, and they declare that no, in fact, they are not responsible adults capable of independent thought and genuine achievement.  It's truly, truly sad what liberalism has done here.  The NAACP's blind support of Obama indicates that they seem to be more interested in slandering rich white guys than in actually improving things for African Americans in this nation.

Speaking of which, I think it's pertinent to note that the NAACP was founded by rich white guys:
You know, one of the biggest lies that the news media and the rest of the Democrat Party is foisted on us for the past 50-years-plus is the lie that the Democrat Party is the savior of blacks and all minorities. 
Do you realize Democrats were the ones who started the KKK? 
You don't find Republican senators that were members of the KKK. But Robert "Sheets" Byrd (Democrat-West Virginia) was a Grand Wizard or Kleagle or whatever. He was a recruiter for the KKK. The Democrats started the Ku Klux Klan. Democrats were the ones who turned fire hoses and police dogs on civil rights marchers in Alabama. Not just Alabama, all across the South. Bull Connor was a Democrat. Democrats were the people standing in the schoolhouse doors refusing to admit black students that wanted an equal education with white students.
It was Democrats who filibustered the Civil Rights Act of 1964. 
It was Democrats that LBJ had problems with, trying to get the Civil Rights Act passed. Now the Democrats have the gall to accuse Republicans of working against blacks and other minorities. As for Biden and Reverend Wright, we don't really care what Biden learned from Reverend Wright. We want to know what Obama learned from Reverend Wright. The KKK was a wing of the Democrat Party. It was the militant wing of the Democrat Party. 
The KKK was created to stop blacks and whites from voting for Republicans. The earliest targets of the KKK were Republicans! How many of you people are probably shocked to hear this? This is one of the great reversals of reality that has taken place in this nation's history. A greater percentage of Republicans voted for the Civil Rights Act in the Senate in 1964 than Democrats, and yet look at what everybody thinks! John Lewis -- who, as he describes it, "got beat upside the head" at the Selma march -- got beat upside the head by Democrats. 
John Lewis marched with Dr. King and got beat up by Democrats. He had the fire hoses turned on him by Democrats. He had the dogs turned loose on him by Democrats. He was chased down by the Ku Klux Klan. It was Democrats that killed Emmett Till. It wasn't Republicans. You'd never know it.

Huh.  How about that!  And now look at where we are today, with Republicans again trying to set African Americans free, to widen the doorways to success and achievement based on their own merits, and promising not equality of outcomes but rather equality of opportunity.  And once again, it is Democrats who are clawing at the ankles of those African Americans who are trying to rise up, pulling them back down like an anchor, intent on keeping them mindlessly in place.

Thursday, July 12, 2012

Yet Another Warning...

...on Obamanomics:

Even as the White House pats itself on the back for a nonexistent economic recovery, new data suggest things are taking a turn for the worse. Make no mistake: This will be Barack Obama's recession, not George Bush's.

'I think we're in recession already," says Lakshman Achuthan, co-founder of the widely respected Economic Cycle Research Institute, a nonpartisan economic think tank dedicated to timing the global economy's business cycles.

How can it tell? The ECRI looks at factory output, employment, income and sales. "When you look at those four measures," Achuthan told Bloomberg TV this week, "they're rolling over."

And ECRI's isn't the only indicator headed South.

As IBD noted earlier this week, the June Small Business Index, put out by the nation's premier small-business group, the National Federation of Independent Business, fell three points in June to 93 — the biggest drop in two years, and the lowest reading for the index since last October. For the record, the index stood at 94 when the U.S. entered the last recession in 2007.

Even more worrisome, the NFIB's jobs index fell for the first time this year, a truly bad sign since small businesses account for at least two-thirds of all job growth.

Still another key indicator, the Purchasing Managers Index, fell to 49.7 in June, down sharply from the 55.8 a year earlier and signaling economic contraction.

Get the picture? Bit by bit, the economy seems to be slipping back into recession.

In the second quarter, businesses added just 75,000 jobs a month, the worst three-month stretch since 2010. And unemployment of 8.2% is way understated. Even the Labor Department says that once you count discouraged workers, real unemployment is 14.9%.

First-quarter GDP growth was a meager 1.9%. Given the abrupt slowing in job growth, many economists say that might be the high point for GDP growth this year. And some, like ECRI's Achuthan, see recession.

Why is this happening? Obamanomics, with its excessive spending, $16 trillion in debt and crushing regulations, is squeezing the life from the private sector.

Worst of all, Obama's renewed threat to raise taxes on families earning more than $250,000 a year could hit 1.2 million small businesses, a new Heritage Foundation study says, all but ending job growth.

Yet, following last week's dismal jobs report, Democratic National Committee Chair Debbie Wasserman Schultz declared herself "pretty happy," while Obama's top economic adviser Alan Krueger said the economy "is continuing to heal."

It's clear the economy isn't thriving under Obamanomics. Yet Obama doesn't change course. Ideologically, for the left, there's too much at stake.

If the economy goes back in the tank, Democrats will again blame George W. Bush. But if we have another recession, this one will be all Obama's. He's earned it.

This fits in perfectly with yesterday's post on how liberal policies simply don't work in reality.  If Obamanomics isn't discarded and rolled back in this next election cycle, it's hard to say how bad things might get before any genuine improvement occurs.  Even worse, America may slip into a dreaded 'new normal' that is essentially 2012 indefinitely.

Speaking of tax issues, Senator Rob Portman of Ohio put out this press release blowing up a related Obama myth:

"While President Obama calls for higher taxes on jobs creators, two new government reports undercut his class warfare argument and the basis for calls for higher taxes.  While I doubt these new studies will cause President Obama to change his tune, because too often, with this President, politics trumps good policy, yet another of his straw men has fallen flat.  As the nation careens toward a fiscal cliff, real leadership, not more rhetoric and finger pointing, is necessary to reform our tax code and address Washington's out of control spending."

The tax policies enacted a decade ago are responsible for just 16 percent of the swing from surplus to deficit. Furthermore, given that only about one-fourth of the tax cuts went to upper-income earners, just 1/25th of the decline from surpluses to deficits resulted from upper-income tax cuts.  (NOTE:  Given that CBO does not take into account any of the positive impact of tax cuts on investment, savings and economic growth, the percentage was actually even smaller than the 1/25th estimate)

The CBO report has shown that new spending and net interest were three times as responsible for the deficits as the 2001 and 2003 tax cuts – and 12 times as responsible as the upper-income portion of the tax cuts.

In a second report, the CBO said that in both 2008 and 2009, the highest-earning 20 percent of taxpayers paid 94 percent of the total income tax burden – up from 86 percent in 2007, and 81 percent before the 2001 tax cuts.  In other words, higher-income Americans have been paying a bigger and bigger part of the total tax burden under the so-called "Bush tax cuts."

The Bush tax cuts weren't just for 'the rich', nor did they get us into this mess.  Now, I would never accuse Bush of being frugal in terms of government spending, but he could get away with his big spending precisely because of the energy his tax cuts injected into the economy.  During the Bush years, the unemployment rate was around 4.5-5%, GDP growth was around 5-7%, and the deficits were only $100-200 billion.  Once the Democrats took control of Congress (and the government purse strings) in 2006, that all started to shift.  Now, we see unemployment of 8-10% (with real unemployment closer to 14-16%), GDP growth of less than 2%, and deficits in the trillions of dollars as far into the future as anyone cares to project.

Funny how all our problems today are still being blamed on George W. Bush, isn't it?  The next time you hear someone say it's Bush's fault, you might suggest that if Bush was actually responsible for the economy, things would be in much, much better shape.

But he's not, and things aren't.  This isn't how I want my kids to grow up.  When can we start voting?

Wednesday, July 11, 2012

An Economics Lesson From Michael Jordan...And The Reality Of Small Businesses

I'm a big fan of explaining complex concepts using simple real-world examples.  This is a great one from Matthew Schoenfeld at the Wall Street Journal (emphasis mine):

What does Michael Jordan tell us about income inequality in the United States? The U.S. has greater income inequality than nearly all other developed nations, and the former basketball star earned far more in most years than the typical American earns in a lifetime. So is our system unfair and stacked against the middle class? First, some historical perspective.

"From the time of Pericles until the end of the 18th century in London—2,300 years," notes Harvard Prof. Lawrence Summers, "standards of living on Earth increased perhaps 100%." In the U.S. since 1790, by contrast, real per capita gross domestic product has increased nearly 4,000%. Quality of life, in other words, increased 40 times more in 220 years of American history than it had globally over two millennia. In 2012, a typical American in the bottom fifth of the income distribution has a far higher quality of life—and life expectancy—than the average member of the top 1% in 1790.

Critics today often point to the 1950s as the last years before American society became so divided between haves and have-nots. At the end of that decade, America's "Gini coefficient"—the most common measure of income inequality, running from 0 (least unequal) to 1 (most unequal)—was 0.37. Today it is 0.45.

But in 1959, more than 20% of families fell below the poverty line. In 2010 that figure was just over 13%. Real per capita GDP today is 270% higher than it was in 1959. A family in the bottom fifth of the income distribution today makes the same amount in real terms as a family earning the median income in 1950. So inequality might have increased, but so too—dramatically—has quality of life.

Even over the last two decades, while real income has essentially stagnated for the bottom fifth of earners, basic conveniences have become far more affordable. In 1992, only 20% of American families below the poverty line had a dishwasher—50% had air conditioning and 60% owned a microwave. When the Census Bureau last surveyed these figures in 2005, those figures were 37%, 79% and 91%, respectively. Critics who minimize the importance of these conveniences likely have never had to do without them.

And that brings us to Michael Jordan, who starred for the Chicago Bulls from 1984 to 1998. In 1986, the Bulls' median player salary was $300,000. The team's lowest-paid player made $135,000, and its highest-paid player made $806,000. The team's Gini coefficient was 0.36. But Jordan's superstardom increased the team's popularity and revenues, and by 1998 salaries looked different. The median income was $2.3 million, the lowest was $500,000, and the highest (Jordan's) was $33 million. The Gini coefficient had nearly doubled, to 0.67.

Jordan's salary of $33 million consumed over half the payroll, but everyone was better off. The median player in 1998 made more than seven times what the median player made in 1986, while the income of the lowest-paid player in 1998 quadrupled that of his 1986 peer.

Detractors would suggest that this situation is anomalous to sports, that many of today's wealthy inherited their money or acquired it without adding commensurate value to society. But consider another basketball player, Rashard Lewis of the Washington Wizards.

Lewis was the second-highest paid player in the National Basketball Association in 2012, making $22.1 million—even though he appeared in fewer than half of his team's games and performed poorly when he did. Is it fair that Lewis was compensated so handsomely? More pertinently, if his team could repossess a portion of his salary and redistribute it more "fairly" to deserving players following the season, would it benefit the franchise?

Perhaps it would in the short term, as the team could reward players and temporarily strengthen morale. But top players would be disincentivized to play for the team in the future, knowing that such repossession could also happen to them. And without an objective measure of overall player performance, the team could one day decide that even a high-performing player was overcompensated and therefore should see some of his proceeds redistributed to his teammates. The team would quickly become uncompetitive.

Certainly there are reasons for concern if lower-income Americans aren't able to save or acquire sufficient capital to pursue innovative ideas, or to see their children attend decent schools. They will suffer, and the country will lose out on significant intellectual capital and growth opportunities. But this should not be confused with inequality.

Equality is not a good in itself and shouldn't be analyzed in a vacuum. If we remember that, perhaps a century from now low-income Americans will pity the living standards of today's 1%.

We just talked about the Gini coefficient in my economics class, and while it's an interesting metric I find it (based on my admittedly limited understanding of it) and the whole premise of 'income inequality' to be a little bit superfluous and misleading.  Schoenfeld's article describes a real-world example of the theory of 'a rising tide raises all boats.'  Rather than focusing on the standard of living of all Americans, metrics like the Gini coefficient instead seek only to portray relative unfairness.  In the 2012 Economic Report of the President, we see the following chart that portrays the current picture of income inequality:

Let's assume that the nation's median income (around $51k/yr) lands squarely in the middle of the middle quintile.  That would mean the difference in income growth between the top 1 percent and the middle of the pack is roughly 243%.  Now, you could look at that as being hideously unfair and unequal, but what happens if we doubled everyone's income?  The gap between the top 1 percent and the middle of the pack would also double, bringing it to 486%.  Using the same logic, that would be an even more unequal distribution of wealth, wouldn't it?

Except...the middle of the pack would now be earning six figures.

So, which makes more sense as a genuine measure of wealth: income inequality, or the dollars people are actually earning?  And the next logical question is: which is more desirable, to narrow the income inequality gap, or to raise all incomes across the board?

I prefer the second answer to both questions.  The Michael Jordan example shows us clearly what happens when there is a rising tide - all boats go up.  Sure, the income gap between Jordan and the lowest-paid player on the team was HUGE...but I'm sure the lowest-paid player could easily console himself with his shiny new quadrupled $500k/yr salary.  And don't forget the danger that lurks in the Rashard Lewis redistribution example, either.  If performance is rewarded with redistribution of the performer's gains, then there is no incentive to perform well at all.  If we want mediocrity in all things, redistribution of the spoils of success is the way to do it.

So how do we create a rising tide that would lift up everyone?  Not by doing what Obama's doing, as described by Ed Carson at Investor's Business Daily:

"I've cut taxes for small business owners 18 times since I've been in office," President Obama said Monday as he proposed tax hikes on the well-off. He stressed, "This isn't about taxing job creators, this is about helping job creators."

Well, that's what he says, but everyone with skin in the game knows better.

The Small Business Optimism Index fell 3 points in June to 91.4, the National Federation of Independent Business reported Tuesday. That's the lowest level since last October and the biggest one-month drop in two years. Net employment at small firms declined for the first time this year. Business owners also soured on the prospects for their profits and sales as well as the overall economy. The report adds to a slew of recent data pointing to deteriorating economic activity at home and abroad.

And that doesn't include the recent ruling that Obamacare will stand.  That one piece of legislation alone packs a whopper of a punch to small businesses:

"With over 20 new taxes contained in the law -- a price-tag of $800 billion -- and most of the regulations yet to be written by HHS, the implications for employee costs remain unclear," said NFIB Chief Economist William Dunkelberg in a statement. "Uncertainty reigns supreme for much of Main Street." 

And that never sparks job creation.  Of course, Obama's playing the political game and saying one thing...

Obama on Monday proposed extending tax cuts, for one year, on families making less than $250,000, while arguing that people making more than that should see higher taxes. 

...while doing another...

Republicans and business groups said that would hit many small business owners. Obama claimed that 97% would be exempt, which is why he said he's not targeting "job creators".


Once again, liberals are ignoring the fact that a huge number of the so-called 'rich' are actually small businesses.  And, since small businesses provide something like 70-80% of all jobs in this country, that's an equally huge problem that actually does mean Obama is targeting job creators.

Obama's small business tax cuts ... often are less impressive in reality than on paper.

ObamaCare includes tax credits to help small firms offer health insurance for employees. The administration's Council of Economic Advisers thought 4 million would use them. But just 170,000 small businesses took advantage in 2010, IRS figures show, according to a recent study by the nonpartisan Government Accountability Office. The reason: The credit was too small and too complex for small business owners.

It's far better to rely on simple tax rates and understandable regulations than intricate policies full of twists and turns and exceptions.  Large companies like McDonald's can afford to hire teams of attorneys and CPAs to pore over every word of the 60,000+ page tax code and ply it to their best advantage...but small businesses can't.  On top of that, large companies like McDonald's have the political pull to manipulate things to their benefit even outside of the tax code.  For example, McDonald's was given an exemption from Obamacare by the Obama administration, so they don't face the penalties for non-participation that small businesses would.  The bottom line:

It's true that about 80% of small firms are one-man or -woman operations with no employees. But firms that start tiny tend to stay that way. Startups that develop into big "job creators" tend to have several employees from day one. But those are firms are more likely to have income above $250,000. Higher taxes on such businesses would exacerbate a key but little-known weakness of the anemic recovery: The number and size of startups plunged during the recession and haven't recovered. 

Ultimately, when Obama claims to be taxing the rich and helping small business, he's doing just the opposite, and they know it.  Now you know it, too.

Monday, July 9, 2012

Ding Dong, The Republic's Dead...Long Live The Emperor!

Kimberley Strassel at the WSJ sums up the Obama presidency:

The ObamaCare litigation is history, with the president's takeover of the health sector deemed constitutional. Now we can focus on the rest of the Obama imperial presidency.
Where, you are wondering, have you recently heard that term? Ah, yes. The "imperial presidency" of George W. Bush was a favorite judgment of the left about our 43rd president's conduct in war, wiretapping and detentions. Yet say this about Mr. Bush: His aggressive reading of executive authority was limited to the area where presidents are at their core power—the commander-in-chief function.
Put another way: Mr. Obama proposes, Congress refuses, he does it anyway.By contrast, presidents are at their weakest in the realm of domestic policy—subject to checks and balances, co-equal to the other branches. Yet this is where Mr. Obama has granted himself unprecedented power. The health law and the 2009 stimulus package were unique examples of Mr. Obama working with Congress. The more "persistent pattern," Matthew Spalding recently wrote on the Heritage Foundation blog, is "disregard for the powers of the legislative branch in favor of administrative decision making without—and often in spite of—congressional action."
For example, Congress refused to pass Mr. Obama's Dream Act, which would provide a path to citizenship for some not here legally. So Mr. Obama passed it himself with an executive order that directs officers to no longer deport certain illegal immigrants. This may be good or humane policy, yet there is no reading of "prosecutorial discretion" that allows for blanket immunity for entire classes of offenders.
Mr. Obama disagrees with federal law, which criminalizes the use of medical marijuana. Congress has not repealed the law. No matter. The president instructs his Justice Department not to prosecute transgressors. He disapproves of the federal Defense of Marriage Act, yet rather than get Congress to repeal it, he stops defending it in court. He dislikes provisions of the federal No Child Left Behind Act, so he asked Congress for fixes. That effort failed, so now his Education Department issues waivers that are patently inconsistent with the statute.
Similarly, when Mr. Obama wants a new program and Congress won't give it to him, he creates it regardless. Congress, including Democrats, wouldn't pass his cap-and-trade legislation. His Environmental Protection Agency is now instituting it via a broad reading of the Clean Air Act. Congress, again including members of his own party, wouldn't pass his "card-check" legislation eliminating secret ballots in union elections. So he stacked the National Labor Relations Board (NLRB) with appointees who pushed through a "quickie" election law to accomplish much the same. Congress wouldn't pass "net neutrality" Internet regulations, so Mr. Obama's Federal Communications Commission did it unilaterally.
In January, when the Senate refused to confirm Mr. Obama's new picks for the NLRB, he proclaimed the Senate to be in "recess" and appointed the members anyway, making a mockery of that chamber's advice-and-consent role. In June, he expanded the definition of "executive privilege" to deny House Republicans documents for their probe into the botched Fast and Furious drug-war operation, making a mockery of Congress's oversight responsibilities.
This president's imperial pretensions extend into the brute force the executive branch has exercised over the private sector. The auto bailouts turned contract law on its head, as the White House subordinated bondholders' rights to those of its union allies. After the 2010 Deepwater Horizon oil spill, the Justice Department leaked that it had opened a criminal probe at exactly the time the Obama White House was demanding BP suspend its dividend and cough up billions for an extralegal claims fund. BP paid. Who wouldn't?
And it has been much the same in his dealings with the states. Don't like Arizona's plans to check immigration status? Sue. Don't like state efforts to clean up their voter rolls? Invoke the Voting Rights Act. Don't like state authority over fracking? Elbow in with new and imagined federal authority, via federal water or land laws.
In so many situations, Mr. Obama's stated rationale for action has been the same: We tried working with Congress but it didn't pan out—so we did what we had to do. This is not only admission that the president has subverted the legislative branch, but a revealing insight into Mr. Obama's view of his own importance and authority.
There is a rich vein to mine here for GOP nominee Mitt Romney. Americans have a sober respect for a balance of power, so much so that they elected a Republican House in 2010 to stop the Obama agenda. The president's response? Go around Congress and disregard the constitutional rule of law. What makes this executive overreach doubly unsavory is that it's often pure political payoff to special interests or voter groups.
Mr. Obama came to office promising to deliver a new kind of politics. He did—his own, unilateral governance.

I heard a phrase not long ago that really drives this policy home: Obama wants to rule, not govern.  Last I knew, this nation was supposed to be governed as a representative republic, not ruled by a monarch.  I guess we'll find out in November what Americans think of their new Emperor.

Wednesday, July 4, 2012

Happy Independence Day!

The unanimous Declaration of the thirteen united States of America 
When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.
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, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. — Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.
He has refused his Assent to Laws, the most wholesome and necessary for the public good.
He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.
He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only.
He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their Public Records, for the sole purpose of fatiguing them into compliance with his measures.
He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.
He has refused for a long time, after such dissolutions, to cause others to be elected, whereby the Legislative Powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.
He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.
He has obstructed the Administration of Justice by refusing his Assent to Laws for establishing Judiciary Powers.
He has made Judges dependent on his Will alone for the tenure of their offices, and the amount and payment of their salaries.
He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.
He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.
He has affected to render the Military independent of and superior to the Civil Power.
He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:
For quartering large bodies of armed troops among us:
For protecting them, by a mock Trial from punishment for any Murders which they should commit on the Inhabitants of these States:
For cutting off our Trade with all parts of the world:
For imposing Taxes on us without our Consent:
For depriving us in many cases, of the benefit of Trial by Jury:
For transporting us beyond Seas to be tried for pretended offences:
For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies
For taking away our Charters, abolishing our most valuable Laws and altering fundamentally the Forms of our Governments:
For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.
He has abdicated Government here, by declaring us out of his Protection and waging War against us.
He has plundered our seas, ravaged our coasts, burnt our towns, and destroyed the lives of our people.
He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation, and tyranny, already begun with circumstances of Cruelty & Perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.
He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands.
He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.
In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince, whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.
Nor have We been wanting in attentions to our British brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.
We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these united Colonies are, and of Right ought to be Free and Independent States, that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do. — And for the support of this Declaration, with a firm reliance on the protection of Divine Providence, we mutually pledge to each other our Lives, our Fortunes, and our sacred Honor.