Saturday, January 21, 2012

Three Birds With One Pipline

 This week President Obama officially cancelled the Keystone XL pipeline project, which would have created over half a million high-paying jobs in the next 20 years. Later in the week the President made a speech in front of Cinderella's castle promising to bring tourists from around the world to Walt Disney World, creating thousands of low-paying service jobs. The real tragedy of the Keystone pipeline cancellation is that in one fell swoop the President dealt a blow to job creation, energy independence and a long-standing relationship with a steadfast ally. This decision was taken to satisfy the extreme environmentalist in his base, whose goal it is, not to protect the environment but to destroy capitalism and wealth creation.
     The Canadian government is extremely disappointed and may now sell its oil to the Chinese, while we will have to be more dependent on Middle East, Russian and South American sources for our energy. But this is just one more slap across the face by the Obama Administration to a long-time ally of the United States. It started with returning the bust of Winston Churchill to the Brits, who had given us as the gift after the terrorist attacks on 911. Since then the Obama administration has broken agreements with the Czechs and Poles for missile defense, has continually abandoned Israel in the face of an ever-increasing radical Islamic terrorist threat and has supported the ouster of long-time ally Hosni Mubarak. President Obama missed a once-in-a-century opportunity to support the cause of freedom and liberty in the spring of 2009. When the Iranian people took to the streets to demand fair and free elections, the President provided no support. In fact, the President threw his support behind the tyrannical Ayatollah. The President seems to have a knack for alienating U.S. allies while siding with dictators and tyrants.
     The President talks about energy independence, but makes us more dependent on foreign sources. First by shutting down deep water drilling in the Gulf of Mexico, against the orders of two Federal judges, and then by cancelling the Keystone pipeline project. In a study last year by the U.S. Geological Society it was determined that there is five times as much oil in North Dakota reserves than in Saudi Arabia. That doesn't even count the reserves in Anwar and all the reserves along our coasts. If we had started to develop these sources to their full potential 3 to 4 years ago, we would already be reaping benefits from them. President Obama seeks to push green energy at the expense of traditional sources, and at the expense of jobs and economic growth. We have seen the effects of this kind of policy with a low growth economy that doesn't create jobs. An economy needs energy to grow, that's just an economic reality. The reason that the President gives for cancelling the Keystone project is that there has not been enough time to study the environmental impact. We currently have 650,000 miles of pipeline in the U.S. The Keystone project is nothing new, in other words, it's a no-brainer.
     In the final analysis it is fitting that the President would give a speech on job creation in front of Cinderella's castle. His belief that green energy will lead to job growth and economic prosperity is a complete fairy tale.

Thursday, January 12, 2012

Mr. Phony Baloney

     Last year Warren Buffet once again made a fool of himself by opening his mouth about tax policy. The billionaire investor said that rich guys like him should be paying more in taxes to the Federal government. Some Republican members of Congress pointed out the obvious to Mr. Buffet, that nothing was stopping him or anyone else from voluntarily sending more money than they owe to the treasury. This week Mr. Buffett doubled-downed on his stupidity by saying he would voluntarily send one dollar to the treasury for every dollar that any Republican member of Congress contributed. This is big talk coming from a man who at present has a team of tax attorneys and accountants working feverishly to relieve him of a one billion dollar tax bill that he owes.
     This kind of hypocrisy is not surprising coming from a man who recently allowed his second in command to take the fall for a mistake that he made. David Sokol had purchased stock in a company called Lubrizol and subsequently recommended the company as a possible Burkshire Hathoway acquisition. In the interest of full disclosure, he informed Mr. Buffett that he owned stock in the company. After the purchase of Lubrizol it came out that Mr. Sokol owned stock in the company and profitted off the sale. Mr. Buffett claimed no knowledge of the previous stock ownership and Mr. Sokol was summarily dismissed and faced legal ramifications.
     Mr. Buffett has had more than a cozy relationship with the Obama administration and has profited from it more than once. The first time was early in 2009 when GE stock, along with every other stock, was a fraction of it's previous price. Mr. Buffett must have been made aware by the administration that GE was set to receive TARP money and he made one of the largest investment he had ever made up to that point. This is the kind of insider trading that most of us would go to prison for if we weren't buddies with the President. But in the current administration, this kind of cronyism is the order of the day.
     Another unsavory deal that saw Mr. Buffett profit from his relationship with the President, is his investment in Bank of America. Part of that deal gives Mr. Buffett a 3 million dollar dividend every quarter. This hardly seems fair when BofA has been prevented by the administration from paying dividends to holders of common shares of stock.
     I use to have respect for Warren Buffett, even knowing that he leaned toward the left. I respected his investment savvy and admired what he had accomplished. But in the last 3 years he has lost my respect by joining the President's class warfare machine. By hitching his wagon to the President's team, Mr. Buffett has unwittingly advocated for the kinds of policies that would ensure that others could not have the same success he has had in this country. All that matters to Warren Buffett is that he's got his billions and to hell with anyone coming up behind him who wishes to achieve the same kind of success.

Sunday, January 8, 2012

It's The Economy Stupid! Or Is It.

     Now that 2012 is here and the General election is a mere eleven months away, the main focus is going to be on the economy. The administration is going to pour untold amounts of money and effort into convincing people that 8 percent plus unemployment is good and that one percent growth in the GDP is exceptional. The first leg of this deception occurred last Friday with the employment number, which showed the economy added 200k jobs in December. This number is not only deceptive because it counts seasonal jobs that will go away in the first part of January, but because it doesn't include the unemployed who have stopped looking for work and the underemployed working part-time jobs.
     If there is one thing that a Rick Santorum candidacy would highlight, it is the inextricable link between strong families and a strong economy. This fact has been fleshed out in study after study over the years, most recently by the Brookings Institute. In the Brookings Institute study, the results showed that if an individual finished high school, married and worked a steady job, the chance of them living in poverty was 2 percent. These same individuals had a 70 percent chance of making 50k a year or more. Individuals who had any one of the aforementioned conditions missing, had a 70 percent chance of living in poverty and only a 4 percent chance of making over 50k a year. One of Senator Santorum's tag lines is that if we want a more limited government we need to have stronger families.
    Liberal policy over the last 50 years has had the effect of destroying the family in lieu of dependence on government. In the mid 1960s when Lyndon Johnson was developing his great society, some in his own party saw the destructive nature of these policies. Daniel Patrick Moynahan implored his fellow Democrats not to implement the policies of the welfare state because, in part, it would lead to a higher illegitimacy rate. Mr. Moynahan deplored the almost 20 percent illegitimacy among inner-city families and said it would go higher if the government replaced the father in those homes. For the record, we now have an illegitimacy rate in the general population approaching 40 percent and over 75 percent among inner-city families. Florida senator Marco Rubio put it more succinctly in a speech at the Reagan library last year when he stated that poverty does not create social ills, but rather social ills create poverty. Senator Rubio is correct, liberal public policy  encourages single-parenthood by subsidizing it. Many studies have shown that well over 80 percent of those in prison come from single-parent homes. These children are also much more likely to do poorly in school and get involved in drugs. If poverty led to higher crime rates, as the left claims, then crime would have been at an all time high during the depression when poverty was at one of its worst levels ever in this country. The facts show that the opposite was true. The reason for the low crime rate during the depression was intact families with strong moral foundations.
     A great philosopher once said that virtue created prosperity and then the daughter ate the mother. This brilliant but simple observation is why I never bought the idea of someone being a fiscal conservative and a social liberal. This identification ignores the irrevocable bond between the social and the fiscal. When the values that create the very fabric of society are subsidized out by government spending, neither the social nor the fiscal health of the country will prosper.

Wednesday, January 4, 2012

The Race is On

     Now that the opening salvo in the Republican primary race has been fired in Iowa, the only thing that is for sure is that nothing is for sure. Mitt Romney has won the Iowa caucus by only 8 votes over Rick Santorum. It was only a few short months ago that some political pundits such as radio talk show host Michael Medved, were saying all other candidates should drop out of the race because Mitt Romney was going to be the candidate and we may as well just accept it.
     The Iowa caucus results are a big win for Rick Santorum, who many consider to be a solid conservative who has no problem articulating conservative principals. A few months ago Senator Santorum was hardly registering in the polls and no one gave him a chance. Even though most conservatives preferred him over many of the other candidates. Now that he has gained momentum going into the Iowa caucus and has virtually won, many may give him a second look as the conservative alternative to Mitt Romney.
     Rick Santorum has been a principled conservative his entire career and has not flipped on any issue. He is a tireless advocate for the sanctity of life, a believer in a strong U.S. military with foreign policy experience and a supporter of limited government and free market principals. He is passionate about his beliefs which will serve him well in debates against President Obama.  He is a true believer in the U.S. Constitution and will appoint judges who will uphold it in their decisions and not legislate from the bench.
     As much as the Iowa  caucus has been a win for Rick Santorum, it has been a loss for Mitt Romney, even though he won by 8 votes. His narrow victory takes some of the wind out of his sails and shows conservatives that they dont' have to settle for a moderate candidate, again. Many of the pundits expected Mitt Romney to walk away with a decisive Iowa win, and the closeness of the results shows his vulnerability and I think his candidacy has been weakened.
     Nobody knows what the ultimate outcome will be, it will play out in the New Hampshire primary next week and in South Carolina after that. One thing is for certain, there are many more surprises to come. One of those surprises might be that Rick Santorum may provide Republicans with the most solid conservative candidate since Ronald Reagan.