110th United States Congress

Government Gridlock

by Bill O'Connell on July 12, 2010

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We currently have a commission investigating how to deal with our ballooning deficit and Brobdingnagian debt.  In the past we have had a commission on military base closings and I am sure there were others that don’t immediately come to mind.  Why do we need them when Congress and the President have the necessary power to make these changes?  Cowardice.  It may be a harsh charge, but that is basically it, no one wants to go on record making tough choices, but if they can get an unelected bipartisan commission to make a recommendation that Congress can vote “all or none” then there are plenty of political fig leaves to go around.

“Well, I didn’t vote for that one, I voted for this one, but it was an all or nothing deal so I couldn’t separate them out.”  We pay these people $174,000 each in base pay and they punt the hard choices to a commission.  Why?  Because they see their primary job as keeping that $174,000 per year job, something that gets easier once you are an incumbent, so long as you don’t make a major mistake, like a hard decision for the benefit of the country.

If you look at the Constitution, the powers granted to the federal government were few and defined, as Madison put it in Federalist No. 45.  With such limited and defined powers, the federal government should focus on a limited number of items and deal with them directly.  But the size and scope of the federal government has grown enormously and the current administration wants to grow it even more enormously.  So don’t look for any tough choices.  Look for more and more commissions to deliver up “solutions” that the weak kneed members of Congress can vote up or down for.  This is gridlock by design.

Once you move most government functions to the federal level, how can anything possibly be accomplished?  How do you pass a law that benefits New York and doesn’t harm Alaska?  How much do Alaska and New York have in common?  Perhaps that is why most major pieces of legislation coming out of Congress run into thousands of pages?  Look at it this way, if a bill of twenty pages is applied differently to fifty states, you soon have 1,000 pages.  But what the Constitution says is that there are a few enumerated powers given to the federal government and everything else is left to the states and the people.  Let the people of Mississippi pass a law of twenty pages that suits the people of Mississippi and let the people of Idaho pass their own.  This will bring about the ability for the other 48 states to look at these two examples and decide for themselves which one would work better in their state or choose a completely different path or none at all.  But if it is all at the federal level you can yell and scream and jump up and down on your Congressman’s desk for all that matters and he can say, “Gosh, I’m just one of 435 members here.  I agree with what you are saying, but…”  If  the issue is at the state level you have more clout and at the local level even more so.

But what we have is a government whose spending is out of control.  We have a commission that will not report until after the mid-term elections and as sure as I draw a breath, their report will be full of new taxes including a Value Added Tax (VAT) to bring buckets of tax revenue to put out the spending conflagration.  Sure there will be some spending cuts, mostly in the discretionary areas that don’t add up to much of the budget anyway, but probably make for good media coverage.

We need to shrink the monster.  We need to take away from the federal government those responsibilities that are not spelled out in the Constitution and let the states and their residents decide how to handle the rest, if at all.  If we don’t take these steps, the gridlock we see today will continue.  The only difference will be that our Congressional representatives will be making over $200,000 a year before long to do what would get them fired in the private sector.

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Congressional Clunkers

by Bill O'Connell on August 1, 2009

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Can anyone offer us a deal to give us cash if replace our Congressional Clunkers?  How about the health insurance companies?  They’d probably kick in, since they are Congress’ new whipping boy.  Oil companies, coal companies?  They get bashed every time Congress screws up and bans nuclear power, offshore drilling, ANWR, and coal as the price of oil climbs.  Banks who didn’t take TARP money?  Well Congress wants to set their salaries now.

Congressional Mileage

How much liberty per dollar are we getting for the money guzzling Congressmen and Senators who pull down $169,300 per year (more for committee chairs, and Speaker Pelosi who weighs in at $217,400)?  And this doesn’t begin to count their expense budgets, gold plated health care, etc.  I’m sure we could get much better mileage from a smaller government and a Congress that only meets half a year.  I’m willing to bet that the longer Congress stays in session the more trouble they get us into, while consolidating their power and feathering their own nests.

Here’s the Plan

Let’s set up a fund.  We’ll let Goldman Sachs run it, as they seem to know how to turn a buck. Anyone can contribute to the fund, no limits. For every Congressman who voted for the Stimulus, Cap and Trade, and the Health Care disaster and is run out of office, the fund will pay out a percentage of the fund to everyone who registered and voted.  The percentage will be calculated as the percentage of these clunkers who are retired out of Congress.

Think about it.  If you are a voter who really, really believes that the Stimulus, Cap and Trade, and the government takeover of our health care system is a good thing, you will vote to re-elect the members of Congress who voted the same way.  However if you don’t, then perhaps you need a little personal stimulus to cross party lines, or set aside ideology, and vote the bums out.  It might even help improve voter turnout.  And why not?  If ACORN can get illegal aliens and dead people to vote for their candidates, we need a way to fight back.

What do you think?

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Liberty Takes Another Hit

by Bill O'Connell on January 9, 2009

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Whoever conquers a free town and does not demolish it commits a great error and may expect to be ruined himself.

Niccolo Machiavelli

Under the radar of most news outlets is the new set of rules the Democrats just passed on how business will be conducted in the House of Representatives.  These rules are typically passed with each new Congress but are mostly procedural and of little consequence outside the halls of that chamber.  But Nancy Pelosi’s consolidation of power is underway.

One of the items in the Contract with America that swept many Republicans into office in 1994 and made Newt Gingrich the Speaker of the House, was term limits for committee chairmen.  The objective was to get fresh ideas into the policy making rather than creating fiefdoms that would only change when the majority of the House changed hands.  The last time Democrats were in power that lasted for forty years.

So, many of the new Democratic congressmen that Rahm Emmanuel skillfully recruited to challenge Republicans, and who were in many cases as conservative or more so than the Republican incumbents, are now shut out of power.

“All those nice pro-life, gun-owning young Democrats recruited to run by Rahm Emanuel will never have any real influence now,” says Grover Norquist, head of Americans for Tax Reform. “They were useful in getting Democrats a majority but now they’ll be in the back of the bus.”

So returning to power are the committee chairmen who ran the committees the last time the Democrats were in power and will remain in power until they die or retire.

Tax cuts will effectively be banned, because the new rules “will mean that the only way to push for a tax cut will be to propose a tax increase elsewhere.”  So if you cut taxes over here, but can only do so by raising taxes there, is that a tax cut?

Pelosi has also eliminated a procedural tool called a “Motion to Recommit.”  It sounds pretty arcane, but it was introduced a century ago to give the minority some safeguards against the Republican Speaker of the House Joe Cannon.  In effect, it allows a vote to send a bill on the floor back to the relevant committee.  Barney Frank justified this by saying the minority was “Only interested in game playing.”  Nice.  Barney Frank is only interested in doing good things for the country, like destroying the financial system by saying that Fannie Mae was fiscally sound before it imploded, but Republicans?  They’re only interested in playing games.

It will be an interesting two years to see how much more the Democrats can quash debate and try to ram their programs through.

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The Auto Bailout Clings to Life

by Bill O'Connell on November 20, 2008

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It’s not over yet folks, although your voice is being heard.  The big sticking point seems to be whether the bailout money should be taken out of our left pocket ($700 billion TARP bailout package) or our right pocket ($25 billion fund to provide re-tooling for green production).  The only people talking about going Chapter 11 are people on the right such as Mitt Romney, who actually knows something about it having watched his father, George Romney, try to save American Motors, as CEO.

Politics Trumps Problem Solving

Barney Frank has weighed in to make sure the class warfare card is played.  He compared the bailout of AIG with the bailout of the auto companies as White Collar (AIG) vs. Blue Collar (GM). A blog by dbeale points this out very well.  This begs the question:  where does it all end?  Where do you draw the line?  If you bail out AIG, you have to bail out GM because they have blue collar workers.  If you bail out GM you have to bail out (fill in the company name) because they have (fill in special interest group).

But if you read the post carefully you can see the true political objectives of the Democrats and their supporters:

  1. Give the auto companies a bailout
  2. Fire most of senior management for mismanagement
  3. Threaten bankruptcy but don’t do it
  4. If the auto companies don’t reinvent themselves (which they can’t do without bankruptcy), nationalize them.  Don’t call it nationalization, call it a “quasi government takeover”
  5. Make sure the focus is on building high mileage cars, and whatever else the green program demands.  Anyone who gets in the way of that goal should be fired. To quote dbeale, “every one involved in undermining gas efficiency standards must go.”
  6. Appoint a automobile czar (don’t call it nationalization) to oversee the companies to make sure that the management isn’t paid too much, that union contracts are reinforced, the “right” kind of cars are built.
  7. Bailout with more government money every 3 years, because the root cause the problem is never addressed.

A Workable Solution

The root of the problem is that the auto companies as they are today, are not competitive.  Here is my proposal

  1. Eliminate the CAFE standards.  The CAFE standards were introduced 1975 in response to the energy crisis.  At least that was the stated objective.  The real objective was to curtail the importation of foreign cars, particularly Japanese cars, which could already meet the standards.  If you wanted to buy a car that got good gas mileage, you could.  This was a attempt by government to force U.S. car companies to make cars of similar economy.  However, their cost structure would not allow them to compete with the imports at the low end of the market.  G.M., Ford, and Chrysler don’t seem to have a problem making a profit on the luxury end of the market, on SUVs, and light trucks.  But if, for example the standard is 27 MPG, and your Cadillac only got 20 MPG.  You would have to sell eight compact cars that get 28 MPG for each Cadillac to comply with the standard.  However, it is estimated that GM is at a cost disadvantage of $2000 per vehicle.  At the luxury end there is enough margin to cover that.  At the low end there isn’t.  So, GM as a direct result of government policy has to sell eight cars at a loss to allow them to sell one car at a profit.  Why not let them sell as many cars at a profit as they can, sell no cars at a loss and let the market decide?  If need a high mileage car to save on gas for your long commute, buy a foreign car.
  2. File bankruptcy.  Reorganize and get rid of those things that are killing you.  That’s what the bankruptcy laws are for.  Yes, shareholders may get wiped out, union contracts will have to be renegotiated, commitments to continue paying revenue bonds for plants that are no longer needed can be renegotiated or voided, pension commitments revisited, etc.
  3. Slim down, come out of bankruptcy, and get competitive again.  The Big three made about 17 million vehicles in 2007.  Does any rational person believe that if the Big Three go into bankruptcy that the people and companies that bought that many vehicles will no longer need cars?  If they still need cars, someone has to build them.  That can either be the foreign makes, the slimmed down Lean Three, or new companies that are formed to take advantage of this huge demand for 17 million vehicles that no one, or not enough are stepping up to the plate to meet it.  People will be re-hired, sub-contractors will have new subcontracts, and the auto industry can actually thrive and not just limp along from bailout to bailout.

The key to this working is to get government out of the mix.  We are facing a plethora of problems and most of them can be traced to government intervention in the market place.  The financial crisis is a direct result of government programs such as Fannie Mae, Freddie Mac, the Community Reinvestment Act, the strong arm tactics of the Clinton Justice Department and HUD to demand more sub-prime lending, and the resistance of Barney Frank and Chris Dodd for more oversight.

The tragedy is that we have problems created by the government and we think that more government is going to fix them.  Keep up the fight.  Let your representatives and senators know, NO BAILOUT

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