Sunday, July 31, 2011

Short and to the point

I don't agree with every point here but most...

viral video about israel

The video, titled "The Truth About the West Bank" – a brief historical narrative that tackles what Ayalon said is the "very simple question" of from whom Israel conquered the West Bank – has garnered nearly 120,000 hits on YouTube since it was uploaded some two weeks ago.

http://www.youtube.com/watch?v=XGYxLWUKwWo

Saturday, July 30, 2011

Friday, July 29, 2011

Republican Rebellion Stalls Debt-Ceiling Vote

"What we're trying to do is save the world from the Republican budget," said House Minority Leader Nancy Pelosi (D.-Calif.).



U.S. House Bids to Salvage Boehner Debt Bill

“If we don’t come to an agreement, we could lose our country’s AAA credit rating, not because we didn’t have the capacity to pay our bills -- we do -- but because we didn’t have a AAA political system to match our AAA credit rating,” Obama said at the White House.

 

http://www.bloomberg.com/news/2011-07-29/house-bids-to-salvage-boehner-debt-ceiling-bill-as-democrats-eye-endgame.html

Debt ceiling breakdown puts GOP at risk

http://www.washingtonpost.com/politics/debt-ceiling-breakdown-puts-gop-at-risk/2011/07/29/gIQAtjE9gI_story_1.htmlm

Boehner's Moment of Truth

http://online.wsj.com/article/SB10001424053111904888304576474563657202494.html

Wednesday, July 27, 2011

Mises Explodes Marxism

http://www.youtube.com/watch?v=wEzXmyT6qNE&feature=related

Re: Commerical

On Wed, Jul 27, 2011 at 7:08 PM, <larry.r.trout> wrote:

'"The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the U.S. government can't pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our government's reckless fiscal policies. ... Increasing America's debt weakens us domestically and internationally. Leadership means that 'the buck stops here.' Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."'

This quote should be the Republicans campaign commercial.



What has me concerned are the news reports that McCain was blasting the tea party ...




Accept Jihad, Or Children Will Die

http://www.humanevents.com/article.php?id=45103

Yet Another Debt-Ceiling Stalemate

http://www.humanevents.com/article.php?id=45105

What We Don't Know about History Can Hurt Us

http://www.humanevents.com/article.php?id=45129

Monday, July 25, 2011

The softer dollar saved the euro's bacon

http://www.marketwatch.com/story/the-softer-dollar-saved-the-euros-bacon-2011-07-25?link=mw_story_kiosk

Friday, July 22, 2011

The Republicans Exit History

http://blogs.suntimes.com/ebert/2011/07/the_republicans_exit_history.html#more

Response to Ebert

In this country there are two competing theories about economics whose positions are mutually exclusive.  The free market approach believes that government gets in the way of economic growth by misallocating resources, by redistributing wealth,  by deterring incentive and innovation through excessive taxation and regulation, and by rewarding corruption and sloth.  The Keynesian theory, which has dominated our government for almost 80 years, believes that government is the driver of economic growth or at least can stimulate it.  Both sides cannot be correct. 

Keynesian economics was a response to the monetary deflation of the Great Depression, caused by the Federal Reserve not obeying the rules of the gold standard.  There is no question that during a period of monetary deflation that the government needs to find a way to inject money into the economy, but that does not mean that this is the solution to our economic problems during non-deflationary times.

The evidence of history is that Keynesian approach has a terrible track record.   Over and over again different governments have tried to stimulate their economy by injecting government spending, but this money has to come from somewhere.  There is no free lunch.  Not only have the stimulus attempts repeatedly failed, but they have prolonged economic misery like Japan's lost decade of the 1990's and deteriorating economic conditions up until about 1939.

Keynesian economics has a certain political expediency by promising people something for nothing.  In a quotation attributed to the French author, Alexis de Tocqueville, the dangers of loose fiscal policy were stated as follows: "A democracy cannot exist as a permanent form of government. It can only exist until the voters discover they can vote themselves largess out of the public treasury."  Few people get elected promising to cut free goodies at the public trough.  It takes a crisis like the current debt to make that happen.

The prosperity of almost every nation is inversely proportional to the size of  their government and to their level of taxation.  This was shown by Milton Friedman and by the Cato institute.  In fact, the most prosperous countries in the world are the ones with the lowest tax rates.  The least prosperous are the ones with authoritarian regimes. However, it is not just an issue of prosperity.  It is also an issue of freedom.  The more government implements its schemes, the more it controls and interfere with our lives.

Way too frequently I hear people say that we should be more like Europe, which makes little sense because the average household income in Europe is half that of the United States.  Although Sweden is often held up for example as an ideal socialist state, Sweden had to cut back on their top tax rates to deal with their stagnant economy.

A secondary issue is whether the rich "pay their fair share."  Government has a few legitimate purposes for which it must tax its citizens.  Beyond that the government is playing Robin Hood to benefit some people at the expense of others.  With the top 1% paying 38% of all income taxes, and the lower 50% paying almost none, you would think that fairness wouldn't be an issue.  Raising taxes fails both practical and moral tests.  The practical failure is that all the federal government tax schemes ever enacted have failed to collect more than 19% of GDP, which means that we have a spending problem and not a tax problem.  We were far better off when fedearl government spending was only 19% of GDP (under Clinton!).  Raising taxes will certainly have a negative impact on economic growth.  Even  a 1% change in economic growth up or down will have a dramatic effect on the government balance sheet.  The moral failure is that government steals from people because it arrogantly assumes that they don't have a right to own the property in the first place.

The left uses the financial crisis to propagate one of the great liberal myths:  That free market is corrupt and causes financial calamity.  The liberal myth of the free market leading to the collapse of the economy completely ignores the reality that government created this mess, through its GSE's and requirements that banks lend money to people who are not credit worthy. In a economy not so distorted by the government, banks have no incentive to make bad loans because it is their money they are going to lose.  But if the government requires people to make bad loans while promising to buy up those bad loans and sell them to investors with an implied government backing, how can the banks be called immoral?  They are simply following the rules that the government created.  If people acted in a corrupt fashion, it is because the government gave them an incentive to do so.

This is not the first time in history that we have seen real estate busts.  There have been several.  The government failed to learn the lesson of history by encouraging people to invest in real estate.  

The Tea Party movement is an appropriate response to excessive public debt.  These people are wiser than they are given credit.  They are not a bunch of rednecks voting against their own self interest. (i.e. "What's the matter with Kansas.")  They are people who realize that the country is driving off a cliff because of liberal spending policies.  They are people who realize that we have gotten too far from the concept of limited government that this country was founded on.

The issue of war is a valid concern and also a complicated issue.  The current administration has done nothing to keep us out of war.  I personally would like to see us get out of the Middle East altogether. 

The health care issue is also complicated, but much of the rise in cost of health care is due to third party payer programs, both public and private, that separate the concept of cost from the consumer.  A better solution, even if subsidized, is the concept of medical savings accounts that require the consumer to make choices about cost versus benefit.  If we put the entire country on a program like this, then we would see more price competition in the medical field.  As for a single payer system:  The Canadian system is fraught with problems and is unsustainable in its present form due to costs.

All other issues are minor and are unlikely to have any consequence nor change very much from the status quo.  The left is good at going on the attack by nitpicking these minor  issues.  The logic seems to be "The other side is so evil, we must be right."  This isn't necessarily the case.  I have noticed that all political sides tend to be reactionary because it is easier to attack what they are against than to defend what they are for.


Best wishes,

John Coffey

References

The True Origins of This Financial Crisis

Democrats Covering up the Fannie Mae, Freddie Mac and Economic Crisis
The Fall of Fannie Mae
Lessons from the Bailout
Community Reinvestment Act
What Does Fannie Mae Do?
Press Briefing by the Clinton White House
High Hopes Led to this Crisis
Wall Street fat cats aren't at fault this time

Evil Concealed by Money
http://en.wikipedia.org/wiki/What%27s_the_Matter_with_Kansas#Criticisms
Hauser's Law
The Rahn Curve and the Growth-Maximizing Level of Government

Does Stimulus spending work?
Can we balance the budget by raising taxes?
Are the poorer getting poorer?

Deficits, Debts and Unfunded Liabilities: The Consequences of Excessive Government Spending

European Levels of Taxation: Barack Obama's Tax Plan
In Defense of ‘The Rich’
Ten Myths about the Bush Tax cuts
U.S. States Lead the World in High Corporate Taxes
National Health Care? We’re Halfway There
Tax Increases Reduce GDP
The Truth about Tax Rates and the Politics of Class Warfare
Marginal Tax Rates
The Optimum Size of Government
The Case for Market Liberalism
Economic Freedom, Prosperity, and Equality: A Survey
Economic Freedom Breeds Prosperity
Do facts matter?
Is Capitalism on the Ropes?
Penny Wise Politics
Are facts obsolete?
The vision of the left
Destroying Liberty
It's the Spending, Stupid
Japan's Lost Decade

Big Surprise: Harvard Study Shows Government Spending Hurts Business



3rd Party Payer Programs
IMF: Canada's Health Care Unsustainable - Be Careful What You Wish For

The Federal Reserve Caused the Great Depression.
Causes of the Great Depression.

Obama Takes Stimulus to the People

Fwd: Debt Ceiling


From: "Larry Trout" 
'Obama faced increasingly vocal complaints from his own Democrats on a deal-in-the-making that could mean painful curbs in popular health and retirement programs but no immediate increase in taxes.

"I've never seen frustration higher," Democratic Senator Dianne Feinstein said.

Negotiations between Republicans and the Democratic White House toward a deal to raise the $14.3 trillion limit on America's borrowing are at a critical phase, with less than two weeks before the world's biggest economy runs out of money to pay its bills.'

It would probably be more precise to say "with less than two weeks before the world's biggest economy cannot borrow money to pay its bills"

http://www.reuters.com/article/2011/07/22/usa-debt-idUSN1E76K2FL20110722

Thursday, July 21, 2011

Fwd: WH talks


'However, congressional Democrats were in a high state of alarm about talks they said were now leading toward a broad deficit-reduction deal that would not immediately include increased revenue. They said this would violate their pledge not to cut benefits for Social Security and Medicare recipients and require them to swallow a deficit-reduction plan that relies solely on spending cuts without raising taxes.'…

'In separate floor remarks, Sen. Charles E. Schumer (N.Y.), the third-ranking Democrat in the Senate, asked whether the United States would allow itself "to be driven into default and financial calamity by a small group of extreme right-wing ideologues in the House GOP."

http://www.washingtonpost.com/politics/obama-gop-leaders-said-to-discuss-new-debt-plan/2011/07/21/gIQAT81BSI_story.html

Exclusive: Inside Darpa’s Secret Afghan Spy Machine

http://m.wired.com/dangerroom/2011/07/darpas-secret-spy-machine/all/1

Climate Change in the United Nations Security Council


'U.S. Ambassador to the United Nations Susan Rice this week issued a blistering rebuke of Russia, China and other countries that blocked the Security Council from adopting a statement linking the threat of climate change to international peace and security…

Moscow's was "skeptical" about efforts to have the council address climate change, Russian envoy Alexander Pankin said, according to Reuters.

"We believe that involving the Security Council in a regular review of the issue of climate change will not bring any added value whatsoever and will merely lead to further increased politicization of this issue and increased disagreements between countries," Reuters quoted him as saying.

India and Brazil, both temporary members of the council, also express reservations about getting the body involved.

The council "does not have the wherewithal to address the situation," Indian Ambassador Hardeep Singh Puri said, according to Reuters.'

http://www.foxnews.com/politics/2011/07/21/rice-lashes-out-at-russia-for-blocking-un-council-from-tackling-climate-change/

Dems pro-choice on abortion but little else

http://jewishworldreview.com/0711/murdock.php3

Wednesday, July 13, 2011

Raise Revenues, Not Taxes

http://online.wsj.com/article/SB10001424052702303678704576439983752724812.html

Fwd: Gold is not money :)


From: larry.r.trout

'Paul: Do you think gold is money?

Bernanke: (pregnant pause) No.

It's not money?

It's a precious metal.

Even if it has been money for 6,000 years, somebody reversed that and eliminated that economic law?

Well, it's an asset. Would you say Treasury bills are money? I don't think they're money either, but they're a financial asset.

Why do central banks hold it?

Well, it's a form of reserves.

Why don't they hold diamonds?

Well it's tradition -- long-term tradition.

Well, some people still think it's money.'

http://www.theatlantic.com/business/archive/2011/07/bernanke-to-ron-paul-gold-isnt-money/241903/

Fwd: Bread


From: larry.r.trout

'It is the eternal struggle between these two principles -- right and wrong -- throughout the world. They are the two principles that have stood face to face from the beginning of time, and will ever continue to struggle. The one is the common right of humanity and the other the divine right of kings. It is the same principle in whatever shape it develops itself. It is the same spirit that says, 'You work and toil and earn bread, and I'll eat it.' No matter in what shape it comes, whether from the mouth of a king who seeks to bestride the people of his own nation and live by the fruit of their labor, or from one race of men as an apology for enslaving another race, it is the same tyrannical principle.

-- Abraham Lincoln, October 15, 1858 Debate at Alton'

Tuesday, July 12, 2011

You fix the budget

http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html

 

FW: The Country is in Denial about Taxes

From:  Larry

 

Yes, I just read the same article.

We do have low revenue compared to GDP, but this didn’t suddenly change because of the extension of the tax cuts.

It changed because of so many more people out of work, and the lower income of those working.

Most articles that quote the taxes at 15% of GDP leave out that spending is now at 25% of GDP.

We could also say ‘The last time they were this low spending was this high , the first baby boomers were riding tricycles.  Now, they’re collecting Social Security and Medicare.’

 

Combined with the effect of the economic slowdown, this decade long tax-cutting binge has decimated federal revenues, which currently stand at less than 15% of GDP.’

If the economy bounces back, we will return to about 17-18% revenue.

The question is, if it bounces back, will we return to spending of 20%.

In 2007 with the tax cuts the government took in 18.5% of GDP and spend 19.6%

In 2009 revenue went down by 3.3% of GDP, but spending went up by 5.4% of GDP.

 

 

http://blogs.forbes.com/leonardburman/2011/07/12/a-country-in-denial-about-taxes/

Smoke and Mirrors

'    "They asked us to join them in another Washington effort to pull the wool over the eyes of the American people. They offered us the opportunity to participate in the kind of deliberate deception of the public that has given public service such a bad name in recent years.

    "We all saw how it worked. The Administration carefully leaked to the media, without any details, the idea that it was willing to go along with trillions of dollars in spending cuts.

    "The lack of detail concealed the fact that the savings they were supposedly willing to support was at best smoke and mirrors. The hope here was that the budget gimmicks and deferred decision-making they actually supported would have the appearance of serious belt-tightening.

    "But the practical effect would have been at most about a couple of billion dollars in cuts up front with empty promises of more to follow. We've seen this kind of thing before. It's just this kind of sleight of hand governing that's put our nation more than $14 trillion in debt. And I will not associate myself with it. I refuse to join in an effort to fool the American people.'

http://www.washingtonpost.com/blogs/right-turn/post/exclusive-mcconnell-to-obama-eat-your-own-darn-peas/2011/03/29/gIQAqastAI_blog.html

Why Obama is pushing for a mega deal.

http://www.cnn.com/2011/OPINION/07/12/gergen.debt.obama/

The Country is in Denial about Taxes

http://blogs.forbes.com/leonardburman/2011/07/12/a-country-in-denial-about-taxes/

The U.S. Treasury will not default

http://blogs.marketwatch.com/fundmastery/2011/07/12/the-u-s-treasury-will-not-default/?mod=google_news_blog