Archive for the ‘redistributive politics’ Category

DC Council sells its citizens down the river

July 11, 2013

Washington, DC minimum wage is $8.25 per hour, already higher than most states across America. District residents are poorly served by low-priced big retail stores. For several years, a sequence of mayors has tried to lure Walmart to the District. Three Walmart stores are currently under construction. Three more are planned.

Yesterday, the DC Council vented its hatred of Walmart by passing new legislation by an 8 to 5 vote. The Council Bill would raise the minimum wage on retailers with stores of at least 75,000 square feet, requiring that such retailers must pay a minimum of $12.50 per hour. Except that all existing big retailers and unionized retailers – like Safeway and Giant – are exempt from the hike. Only Mayor Vincent Gray’s veto stands in the way of this discriminatory legislation.

Walmart has responded immediately by cancelling the three newstores, should the bill become law. It is reviewing its contracts to determined whether to abort the three stores under construction. No wonder Congress is more than reluctant to grant DC statehood. What manner of corruption and ineptitude would follow when an electoral majority is completely devoid of forward-looking intelligence

Islamic theocracies cannot survive economically in the global economy

July 7, 2013

In a distinctly bad sign for the future of Egypt, the military dictatorship buckled to appease Islamic fundamentalists yesterday, rejecting a secular candidate for Prime Minister after earlier announcing that he had been appointed to that position.

From the perspective of my column posted yesterday, this sets a disastrous precedent. Theocracies fare badly economically in the modern world. Islamic theocracies are also fundamentally hostile to any true concept of democracy.The reason for this is that Islam as a religion is still trapped in the 14th century. Sharia law is viewed as supreme over any secular thinking. And the idea that an illiterate 7th century Prophet can determine institutions required for a modern global world economy is simply ludicrous. It is equivalent to believing that the pre-Reformation Spanish Inquisition could provide good economic governance for the West.

The die, it would appear, has now been cast. Egypt will remain a seriously economically undeveloped, repressive nation for many years to come. The military has chosen England’s 1660 Restoration over its 1689 Bill of Rights. Some 30 years of the equivalent of the Stuart doom will surely follow.

President Obama in turbulent waters steers a boat without a compass

June 30, 2013

When a president is elected into office on the basis of affirmative action criteria, the nation would be fortunate indeed if the elected official were to be truly competent. The United States has enjoyed no such good fortune. President Obama’s first term clearly demonstrated an exceptional level of incompetence in matters economic and international, the two key functions of any modern presidency.

To achieve re-election, Barack Obama had to run an entirely negative campaign that vilified his Republican opponent, a man of evident success in economic affairs, though inexperienced in matters international. Because he could not run on his record, and would not run on a coherent future policy platform, President Obama returned to the White House bereft of almost any policy program capable of attaining majority support in both houses of Congress.

Six months into his second term, President Obama appears to be completely lost, aimlessly steering the vessel of state in increasingly turbulent waters, without any compass to define his direction. Domestically, his only viable policy is immigration reform and he has abandoned details of any such action to the Congress. His economic policy is in a shambles, unacceptable either to Democrats or Republicans, or any combination of both. His international policies are in ruins, as powers, both great and small, respond to his overtures with varying degrees of open contempt.

If the situation does not change – and effective change appears to be beyond the reach of this diminished administration – President Obama will be remembered only for Obamacare. And Obamacare promises to be the most disastrous program ever unfolded on the United States.

This is what predictably happens when criteria other than past performance and future potential are applied by a majority of an electorate in two successive presidential elections. Eight years of uninterrupted incompetence gives rise to a great deal of ruin in a nation.

Lady Macbeth ousted by reincarnated Thane of Fife

June 27, 2013

In a continuing drama reminiscent of Shakespeare’s Macbeth, Julia (the Red) Gillard has been forced out of office as Australia’s Labor Prime Minister by Kevin Rudd (Crudd to his many enemies), the man whom she ousted from the same office in June 2010. With political blood on both pairs of hands, Punch and Judy both appear to be headed for the knacker’s yard in the upcoming September 14, 2013 general election. A Newspoll survey this week shows Labor trailing the center-right Liberal Nationals by 43 per cent to 57 per cent.

Julia the Red, inevitably, blames her ousting on sexism, though she surely did not claim her 2010 coup on anti-male prejudice. In reality, the current blood-bath is a natural consequence of socialism. As the Iron Lady, Margaret Thatcher once famously noted: the problem for socialists is that sooner or later they always run out of other people’s money!

Julia Gillard conspicuously achieved this fate failing to balance the nation’s budget this year despite hiking an unpopular carbon tax onto the economy. As always under socialism, Australia’s economy is slowing, leaving her Party vulnerable to voter revenge.

Kevin Rudd’s immediate challenge is to convince voters that he presides over a united political party. Following a recent history with parallels to England’s Wars of the Roses, it is doubtful that this victory for the White Rose over the Red will convince Australian voters to stick with such a divided pair of houses. More likely, the September 14 Battle of Bosworth Field will see the White Rose defeated and governance returned to a Liberal National Tudor Rose.

A new dawn of American impotence

June 25, 2013

Since January 2009, President Obama has pursued a foreign policy designed to remove the United States from nettlesome foreign entanglements. The world has watched and understood. President Obama now discovers that the United States is running out of foreign influence. Any realpolitik analyst would anticipate such an outcome. For Obama, the unfocused dreamer, reality has come as a complete shock.

Reality has finally dawned because of Obama’s inability to bring back Edward Snowden to so-called American ‘justice’. Foreign powers, great and small, evidence schadenfreude, as they watch the United States president slowly twisting in a biting wind of his own creation.

But much more is awash for Obama’s America than Edward Snowden. Afghanistan’s understated debacle is a spectacular example. Last week, the Taliban opened an office in Doha for the Islamic Emirate of Afghanistan – the name that Mullah Omar gave to his regime before its 2001 downfall at the hands of President George W Bush. In response to this office opening, President Hamid Kharzai shut down negotiations with the United States over post-2014 security cooperation.

So what has really happened? Merely to get the Taliban to the table for a bogus peace process, Obama and Kerry agreed, at the urging of Pakistan, to allow Mullah Omar to access the negotiations on his own terms: no acceptance of the Afghan Constitution, no ceasefire with international forces, not even a pledge never again to allow Afghanistan to become a haven for international terrorism. Worse still, Obama and Kerry are to allow the terrorist Haqqani network – whose exploits include the 2011 siege of the U.S. Embassy in Kabul – a seat at the table.

So, having legitimized Haqqani and given the Taliban everything it wanted, in exchange for nothing, the U.S. now finds itself dumped by its own client government in Kabul. That government can always turn to Iran as a substitute patron. No peace, no peace process, no ally, no leverage and no moral standing, all in a single stroke.

Well done, Barack Obama and John Kerry! You truly have shown British Prime Minister, Neville Chamberlain, how far appeasement can really go when genuine pacifists come to power.

As for the American electorate, well this is what happens when you twice elect a president into office on the principle of affirmative action.

Hat Tip: Bret Stephens, ‘The Age of American Impotence’, The Wall Street Journal, June 25, 2013

Bernanke has now burst price bubble in long-term Treasuries

June 21, 2013

When socialist bureaucrats are finally done with meddling in financial markets, turbulence is inevitable, as Vladimir Bernanke is now discovering.

Investors who do not understand the nature of a Federal Reserve-driven Treasury price bubble will have experienced severe headaches last night. Those who do not understand the herd instinct, and who hold on to their long-term bond portfolios in coming weeks, in the expectation that the bond market will recover, will wake up six months from now with more than severe headaches.

Inevitably, Bernanke’s signal that the socialist experiment is coming to an end, has hit stocks significantly, with the Dow down 4 per cent or so from its peak in May 2013. However, as long as the real economy does not take a hit – and that is to be determined – stock prices will return. Investors may hold on to their stock portfolios with a degree of confidence.

However, Treasuries are an entirely different matter. Yields on long-term Treasuries will now rise significantly, albeit with a degree of volatility, as QE3 tapers and eventually disappears. If 10-year Treasuries show yields of 5 per cent, say in one year’s time, an investor who bought say $100,000 of those Treasuries at 1.6 percent some months ago, will wake up to find that portfolio valued at $32,000. Only by holding those bonds for ten long years to maturity can such investors avoid that huge loss of capital. And if they do so, they will live in a 1.6 percent per annum yield environment while those who come after them earn 5 per cent per annum.

Suffice it to say that Vladimir Bernanke will not walk the streets safely at night when large-scale government bondholders wake up to the harm that he has wrought.

The bull is throwing Bernanke around like a piece of flotsam

June 20, 2013

I predicted that Ben Bernanke would have a tough time dismounting the market bull. Well, as things go, Bernanke may be quickly thrown by the bull and gored to a nasty exit.

The Dow has lost 500 points in two days.Ten year Treasury yields have risen from 1.6 per cent at the end of May to 2.46 per cent today. Bond prices have fallen accordingly.If this goes on, just watch for the political fall-out. After all the 2014 elections are getting closer by the day.

Thus always ends the fatal conceit. Bernanke may act as though he is the master of the universe. In reality, he is just a piece of helpless flotsam in the rodeo arena.

The IRS is poised to go from bad to worse

June 16, 2013

We now understand just how bad the IRS has become in the United States. We are aware that the agency illegally harassed existing conservative groups and illegally discriminated against would-be conservative groups applying for tax exempt status during the run-up to the 2012 elections.We are aware that the agency wastes vast sums of taxpayers’ dollars on boondoggle conferences, including at least one that featured its employees dressed up as Star Trek characters. That is all part of the recent past.

More ominous are expectations about the future. A July 2012 report by the Inspector General for Tax Administration stated that ‘the IRS needs to make improvements to stop billions of dollars in fraudulent or improper tax refunds resulting from identity theft and erroneous claims for tax credits.’ Although this statement does not specifically address the implications of Obamacare, that is where the IRS cess-pit truly will open up.

Let us put the pending crisis into perspective. The IRS claimed that it could not handle an increase of 1,700 applications for tax exempt status, and that spurred its targeting of conservative groups. Under the Affordable Care Act, premium subsidies – the tax credits in Obamacare designed to defray the cost of purchasing health insurance – will go to some estimated seven million tax filers and flow to households earning as much as $94,000 a year. The credits are advanceable and refundable, meaning that the IRS will pay them first and verify the claims later: what some call pay and chase.

The IRS has never been able to handle refundable tax credits in other programs. A lot of such payouts go to households inappropriately and are never pulled back. The Earned Income Tax Credit is a good example. The Treasury department’s inspector general for tax administration reported in April 2013 that improper payments accounted for 21 to 25 per cent of total EITC payments in 2012.

If we apply that percentage to the approximate $1 trillion that will be spent on Obamacare credits in the decade beginning in 2014, the math shows that between $210 billion and $250 billion will be distributed to ineligible households. Since the IRS has no system in place to verify reported households income, most these outlays will never be reclaimed.

Hat Tip: Orrin Hatch, ‘Think the IRS Is Bad Now? Just Wait’, The Wall Street Journal, June 15, 2013

Put your trust in Barack Obama and Erich Schmidt?

June 11, 2013

President Obama and Google CEO, Erich Schmidt, potentially can access almost every email message transmitted across the United States and well beyond. Barack Obama is a left-leaning Democrat. Erich Schmidt, in 2012, maxed out his political contributions in support of Barack Obama. So he also must be presumed to be a left-leaning Democrat (or a wealth-seeking hypocrite, take your pick).

So do you trust Obama/Schmidt to refrain from utilizing this available information for left-wing political purposes? Do you think that they might do so, if such data were likely to swing votes in favor of the Democratic Party? Do bears defecate in the woods?

We know for sure that President Obama did not come clean with respect to the data mining that his administration has established, under the guise of monitoring terrorism. In itself, this demonstrates utter contempt for the people, who have hired him as their lackey to represent their interests. We know that Erich Schmidt did not voluntarily disclose the extent of Google’s monitoring of internet activity, even though Google supposedly is in a contractual relationship with its clients.So basically, they already have reputations somewhat inferior to second-hand car salesmen.

How comfortable are you when dealing with a second-hand salesman at some backstreet big city garage? Would you leave your wallet or your handbag on the table when visiting the washroom in such an establishment?

Bravo, Edward Snowden for whistle-blowing on Obama! Bravo, Putin’s Russia, for offering Edward Snowden political asylum as he runs for his life, hotly pursued by vengeance-seeking U.S. snoops.

Remember Jason Bourne, anyone?

Obama to IRS: harass and audit my enemies

June 7, 2013

In late August 2010, the U.S. Internal Revenue Service issued its first ‘Be on the Lookout’ list, flagging applications containing key conservative words and issues. The criteria would expand in the months to come.

Here is an interesting timeline for you to think about:

August 9, 2010: In Texas,President Obama for the first time publicly names a group he is obsessed with – Americans for Prosperity, founded by the Koch Brothers, and warns about conservative groups: ‘Right nowall around this country there are groups with harmless-sounding names like Americans for Prosperity, who are running millions of dollars in ads…And they don’t have to sat who exactly Americans for prosperity are. You don’t know if it’s a foreign-controlled corporation.’

August 11, 2010: The Democratic Congressional Campaign Committee sends out a fund-raising email warning about ‘Karl Rove-inspired shadow groups.’

August 21, 2010: President Obama devotes his weekly radio address to the threat of ‘attack ads run by shadowy groups with harmless-sounding names: ‘We don’t know who’s behind these ads and we don’t know who’s paying for them…You don’t know if its a foreign-controlled corporation…The only people who don’t want to disclose the truth are people with something to hide.’

August 27, 2010: White House economist, Austan Goolsbie, in a background briefing with reporters, accuses Koch industries of being a pass-through entity that does ‘not pay corporate income tax’. The Treasury inspector general investigates how it is that Mr. Goolsbie might have confidential tax information. The report has never been released. The same week, the Democratic Party files a complaint with the IRS claiming that the Americans for Prosperity Foundation is violating its tax-exempt status.

When messages like these are transmitted across the wires, from Obama and his cronies, how do you think they will be received by the low-grade, left-leaning protoplasm that overwhelmingly dominates the offices of the IRS?

Hat Tip: Kimberley A. Strassel, ‘An IRS Political Timeline’, The Wall Street Journal, June 7, 2013