Bernanke's Bountiful Basket of Bull

      This Wednesday, the Federal Reserve chairman Ben Bernanke spewed out some of the most financially illiterate ignorance I have seen from a public figure since the President's last public speech. This is not a surprise coming from a man who has never held a job in the real economy and is firmly ensconced in the  economic theory of academia, which has very little relationship to the real economy.
     The market responded positively to the Chairman's remarks, and why wouldn't they. For the last 3 years they have been the jonesing crack addicts to Big Ben's quantitative easing fix. In recent bond auctions, which is how the government borrows money to fund all the things they shouldn't be doing, the Federal reserve has bought 90 percent of all the government's debt. It's not the Chinese that Americans have to worry about, it's the Federal reserve monetizing our debt to levels which have ballooned its balance sheet to over 7 trillion dollars. Anyone with a grade school education realizes that this situation can't continue indefinitely. Eventually the U.S. currency will collapse and our credit worthiness will be in dumper.
     In 2010, tax-cheat Timothy Geithner (Treasury Secretary) went to China and told officials there that the U.S. was not monetizing its debt. The Chinese called him on it by letting him know that they have kept track of our money supply and that we were most definitely monetizing our debt. Since then the Chinese have been divesting themselves of U.S. debt. Which is why the Federal Reserve has had to buy the debt themselves, further exacerbating the monetizing problem. Of the 5 trillion dollars in new debt created by the Obama administration, over sixty percent has been purchased by the Federal Reserve. They have done this by simply printing money and using it to buy the Federal government's debt, which is going to hurt pension funds which invest in long term bonds.
     If all this wasn't enough to scare the b-Jesus out of you, Big Ben made a comment during his remarks that made me pop a blood vessel in my brain. He said that the government had to reduce incentives for companies to grow. Evidently this is to avoid the myth of too-big-to-fail that this administration has used to cut the legs out from under capitalism. The administration has done a good job of doing just that, which is why we have the longest period of unemployment over 8 percent since the Great Depression of the 1930s. It has been this intense meddling in the economy by people like Ben Bernanke, who don't understand it, that has lead to a lack of confidence in the markets to stand on their own, anemic GDP growth and chronically high unemployment. November's election can't come quick enough and with it a change in leadership at all levels of government.

The Cowardice of Rock

     Over the last 3 years, Gibson guitar has been, in the words of CEO Henry Juszkiewicz, stalked by the Department of Justice. The basic gist of the DOJ case is that Gibson illegally imported ebony and rosewood, used in the fingerboards of their guitars. But this is based on the DOJs wild misinterpretation of Indian law, where the wood originates. The Indian government approved the transfer of the wood and the United States Customs department did as well. The importation of the wood was also approved by Forest Stewardship Council, which has the final word on these matters. The entire process used by Gibson in securing the wood was completely legal and followed the laws of both countries. The process, by the way, is the same one used by other guitar manufactures, who for some reason have escaped the DOJs attention. Gibson, to date, has not been officially charged with a crime but has had a half million dollars worth of their product confiscated by the U.S. government as well as losing one million dollars in productivity.
     The reason for this selective prosecution (or what some may call persecution) of Gibson guitar might be found in the political realm rather than the legal. Gibson guitar is a non-union shop and has donated money to conservative causes. This wouldn't be the first time the Obama administration has used the power of government to silence its political opponents. It started after the administration took control of GM and closed profitable car dealerships owned by Republicans. It continued when the administration tried to ban Fox News from White House press briefings. This move was roundly criticized, even by the left-leaning mainstream media and the administration was forced to reconsider its decision.
     It seems to me that no matter what the reason for the DOJs selective prosecution of Gibson guitar, there is a blatant injustice in it. I'm wondering when we will hear from the rock stars who claim to abhor injustice. Country music stars have come out in support of Gibson, but as of the date of this post, the only rock musician to come to Gibson's defense has been Ted Nugent. It seems as though his fellow rockers, like Bruce Springsteen, Bon Jovi, et. al., don't have the courage to stand up for injustice when it conflicts with their politics. Their courage only extends to causes for which their Allys on the left won't criticize them. The cowardice of these rockers is defined by their unwillingness to stand with true justice against the slings and arrows of an out-of-control administration and its sycophants in the mainstream media.

Fidel Is Smiling

     Florida Marlin's manager, Ozzy Guillen, recently said that he loved Fidel Castro. The comment was made while he was being interviewed for Time magazine. The incident sparked a firestorm which resulted in Mr. Guillen's suspension from baseball for five games. Let me state for the record that I think Fidel Castro is a murdering tyrant and is not worthy of love, except maybe by God, in whom he doesn't believe. But I am also a big supporter of free speech, even when that speech is misguided and offensive to some people. Mr. Guillen's comments can be characterized as misguided and most certainly should be offensive to anyone who believes in justice and liberty. These concepts have been absent from Cuba for the 50 plus years that Fidel Castro has ruled.
     I have to wonder why Mr. Guillen's comments are any more offensive than the useful idiots in Hollywood and elsewhere who wear Che Guevara tee-shirts and elevate him to some sort of heroic status. After all, Che Guevara was a murdering coward who ran away from the only battle in which he was ever involved. When the Bolivian military found him hiding like the Coward he was, he begged for his life saying he was the great Che Guevara and was worth more to them alive than dead. He was very brave when he was slaughtering unarmed and innocent men, women and children. It was a different story when he faced armed military personnel.
     I also wonder why Mr. Guillen's comments would be any more offensive than Anita Dunn saying that Chairman Mao was one of her heroes. She made the comment while delivering  a speech to high school students. At the time Ms. Dunn was President Obama's press secretary. Mao murdered 100 million of his own countrymen and tortured untold millions more. Just the kind of a guy you'd want administration officials to lionize. And while we are on the subject of Mao, I take much more umbrage with the President and first lady hanging a Mao ornament on the White House Christmas tree their first year in office than I do with Ozzy Guillen's remarks. I also find the strict adherence to politically correct speech the left has placed on public discourse to be more offensive than a comment made by a baseball manager. Let's not forget that there are many people on the left in this country, some of whom are in our government, who have expressed admiration for Fidel Castro and the wonderful things he has done for the Cuban people. Some of these people are bound and determined to impose the Cuban-style of healthcare on the U.S. Now that I find that much more offensive than Ozzy Guillen's comments.
    Ozzy Guillen's remarks were stupid and misguided, but don't rise to the level of offense that our government officials utter almost on a daily basis. Freedom of speech has no filter that strains out stupidity, people are free to make fools of themselves. I think the reaction by Major League baseball and others to Ozzy Guillen's remarks were somewhat disproportional. I have to think that in some corner of Cuba Fidel Castro is watching the limits we are placing on our own free speech, and Fidel is smiling.

Voter ID Opposition Equals Citizen Disenfranchisment

     There has been quite a dust-up recently over the institution of voter ID laws various states. Democrats are opposed to these sensible laws because they say it disenfranchises blacks disproportionally because more inner-city blacks are likely not to have IDs than other segments of the population. The fact is that most states allow lower income residents to obtain state IDs free, and in some states they will even send a representative to a person's house to sign them up for an ID. Nothing could be easier than obtaining an ID, no matter in which state you live.  
      The most obvious reason for Democrat opposition to voter ID laws is corruption of the voting process. If one doesn't have to prove who they are, it allows for more deception in voting. This was recently illustrated by James O' Keefe, the now famous videographer who exposed the immoral and illegal tactics of President Obama's favorite community organizers, ACORN. Mr. O' Keefe strolled into the polling place in Attorney General Eric Holder's district, and without an ID, the poll worker was going to allow him to vote as Eric Holder. The poll worker actually said that as long as he was on the list and said he was who he claimed to be, no ID was necessary. The really frightening part is that Mr. O' Keefe never said he was Eric Holder, he only asked if they had a registration for Eric Holder. The poll worker eagerly volunteered to allow him to vote as Eric Holder.
     I think the opposition to voter ID goes much deeper than simple elections fraud. Without an ID it is very difficult for someone to fully participate in our society. An ID is needed to cash a check, obtain a credit card, board a plane and hundreds of other activities which allow a person to fully participate in the economy. We should be encouraging people to be responsible by securing an ID. But the political fortunes of Democrats depend on keeping people irresponsible and separated from participation in the economy. The more people become self-sufficient, the less they need Democrat politicians passing legislation to feed, clothe and house them. This has been outlined by President Obama in many speeches, most recently when he talked about the failure of the "on your own economy." The President would have people believe that they can't make it on their own and need government to intercede on their behalf. But what the President, and others who believe as he does, fail to recognize is that it is free market capitalism and the individual freedom it provides that created a nation that has advance the human condition more than any other in the history of the world. Freedom dictates that the individual takes the responsibility of proving who they say they are when it comes to our most precious right, the right to vote.

Another U.S. Downgrade

     On Thursday, April 5, 2012 the small credit rating agency of Egan-Jones downgraded the United States to AA from AA+. Egan-Jones foreshadowed the downgrade last Summer by S&P, when for the first time in history, the U.S. rating was downgraded from its pristine AAA rating. The reason cited for this downgrade is continued non-action on dealing with the burgeoning debt. For the first time since World War II, U.S. debt has exceeded 100% of our GDP. The Democrat-controlled Senate has not passed a budget in over 3 years and although the President has submitted two budgets in the last two years, no one in his own party, let alone any Republicans,  have voted for either one. The Republican-led House, behind the leadership of Paul Ryan, has passed budgets each year since they won control of the House in the 2010 mid-term elections. These budgets have only gained scorn from the President and his party. It's obvious that the President and the rest of the Democrats want to keep spending without the restraint of a budget.
     The Federal government is borrowing 40 cents of every dollar it spends. The Federal Reserve holds bond auctions to sell that debt to investors. As a result of quantitative easing programs, the Federal Reserve is now purchasing nearly 60% of the bonds it sells. There is also a waning desire for U.S. debt,  even from China, which has begun to divest itself of U.S. debt. All this buying of our own debt has expanded the Fed's balance sheet to a record level of over 7 trillion dollars. How long do you think you could sustain your finances if you were borrowing 40% of what you spend and 60% of that you were loaning to yourself by printing your own money and buying your own bonds? This, of course, is a recipe for disaster and it is only getting worse with each passing day.
     It's not too late to right the ship, but the Federal government has to divest itself of unnecessary spending. And this can't be achieved by taking money out of the private economy through higher taxes. There are literally thousands of government programs that can be cut that would not affect the health and welfare of the nation. Just look at the 10's of billions of taxpayer dollars that the President has given to "green energy" companies run by his cronies. Most people have heard of the bankrupt Solendra, which received half a billion dollars and then went bankrupt. But there have been at least half a dozen others, some of which received up to 2 billion dollars, that have gone bankrupt. Investing in companies run by the President's donors in an industry that doesn't yet exist, is not the role of the Federal government.
     If the adults don't get control of the Federal government's purse strings, we are headed for forced cuts which will make the Greek austerity look like high living. We have already seen a preview of the violent reaction that this type of austerity will cause, when this week in California students rioted over higher tuition. Get ready for more of this kind of behavior as the crack that is government spending is yanked away from an ever-increasingly dependant populace.

Yes Nancy We Are Serious

     Two years ago, the legislation known as Obamacare, was written in the dark of night and rammed through Congress using parliamentary tricks so as to avoid debate. It was passed with only Democrat votes (the first time in our history a major piece of legislation didn't have bi-partisan support). Some of those Democrat votes came as a result of bribes (Ben Nelson's cornhusker kickback and Mary Landreu's Louisiana purchase) and some as a result of lies (the administration's assurances to Bart Stupack and other pro-life house Democrats that no Federal money would be used for abortions under the bill). Before the bill was passed, Nancy Pelosi uttered her now famous line that we had to pass the bill in order to find out what was in it. A less-famous statement by former Speaker Pelosi, but a more telling one, was when she responded to an inquiry about the constitutionality of the bill by saying, "Are you serious?" No matter how the Supreme Court decided the case regarding the constitutionality of Obamacare, the oral arguments before the court this week sent a resounding, "Yes" to Mrs. Pelosi's question of two years prior.
     Listening to the oral arguments presented to the Supreme Court by both sides this week was just slightly more fascinating than listening to the pundits on the left expressing dismay at how badly their ideology holds up under the scrutiny of the Court and constitutional common sense. In typical Liberal fashion there was no self-examination of the folly of their position, after all they can't possibly be wrong. So they blamed everyone from the the Conservative members of the court who decide cases on the basis of the Constitution (what a concept) to Solicitor General Donald Verrilli, who had to defend the indefensible. That is not to say that Paul Clement, who represented the 26 States who brought the case before the Court, didn't do an excellent job presenting the opposing side. But at the very core of the argument is the individual mandate which is just a door, that once opened, removes any restraint on the Federal government. The foundation of the Constitution, and of our entire system of government, is based on restraint of Federal powers. If the government is able to compel citizens to engage in commerce to purchase health care, then it can compel citizens into any behavior the government deems beneficial. This, my friends, is tyranny at its worst. This case, more than any other in recent memory, is a slam-dunk and without the specter of politics coloring the issue, should be decided 9-0 in favor of striking down Obamacare. But then politics influences even a court whose members are given life time appointments for the express reason that they not be influenced by politics.
     The Supreme Court, in addition to deciding weather the individual mandate is constitutional, will also decide the issue of severability. Most legislation is written to include a severability clause which states that it is the intention of Congress that if any part of the law is found unconstitutional, the rest of the law will stand. Nancy Pelosi removed this clause from Obamacare, which means according to the letter of the law, if the Court strikes down the individual mandate the entire law must go. Because without the clause the only conclusion the justices can come to is that it is the intention of Congress that if any part is found unconstitutional, then they would not have passed the rest of the law on its own merits. There is little reason to believe that the letter of law will be followed in this case, and the Court may decide to strike the mandate and leave most of the rest of the law intact. This will still be a victory for liberty because the forces of those who sanction limitless government will have been turned back by those who believe in the constitutional principle of enumerated Federal powers and that freedom can't exist in an environment of unrestrained government. Unfortunately, for someone who believes as former Speaker Pelosi, the Constitution is not to be taken seriously.

It's All About Me!

     When I consider the problems in our society, most can be attributed to selfishness. This selfishness is not to be confused with self-interest, which is what creates opportunity for others and prosperity in general. The baker makes bread to sell to you so that he can support his own family. If he makes good bread at a fair price, his business will thrive and he will create opportunity for the people he will have to hire to support his business. Those people work for the baker, not as a favor to him, but in their own self interest to support their families. They buy goods and services with the money they make, and invest with the money they save, and the wealth of the nation is created. Only free-market societies can do this, that is why the least amount of wealth is in countries who have command economies with over-burdensome government interference.
     But back to my original point, that selfishness creates not only financial problems for a society, but also cultural ones. This is one of the reasons that the self-esteem movement of the last 20 years has been so destructive. It has taught a generation of children that their self-esteem is dependant on someone else handing it out wholesale like bubblegum instead of earning it through their own accomplishments. These children grow up thinking they are the center of the universe and develop anxiety problems later in life when they learn they are not. It's no wonder that since the 1960s, when the emphasis moved from civility to self, that there has been a steady increase in the cases of depression. Depression, after all, is a self-centered condition. It's the total submersion into oneself which causes feelings of being alone which can lead to depression. That is why there are many sources that recommend people who are depressed reach outside themselves by helping other people in order to feel more involved in something other than self.
     There are many visible examples in our society of the, "It's all about me" syndrome. Some are small and seemingly mundane, like when parents plaster bumper stickers on their cars announcing to the world how special their kid is for getting good grades in school.  Getting good grades use to be expected of children, it wasn't a grand accomplishment worthy of an advertisement on the parent's car. These parents have unwittingly inculcated in their children the thought they are special to the world for simply doing what they are suppose to do. It takes context away from accomplishment. Getting good grades is put on the same level, by these parents, as much larger accomplishments that may be worthy of the more visible attention. The same thing is true with the many sports programs that teach kids that everyone is a winner. When children grow up believing this, they feel victimized when they find out it's not true in the real world. Children have to learn how to lose and also that they may not have the skill in an area of endeavour that someone else has. This is how they are able to define their own strengths and weaknesses. Parents who shelter their children from life's realizations, to keep their egos from being bruised, are doing their children a disservice. As Abraham Lincoln said, "I learned more from my failures in life than I did from the successes."  One thing I've learned from my own personal failures is that I'm not the center of the universe and I should always strive to make myself a better person. Sadly, this is a lesson lost on graduates of the self-esteem movement who have been told there is no need for them to better themselves through accomplishment.