There was a commercial not too long ago where a young man looked out his window to the village green where a bundle of money had just fallen.  He calls his wife/girlfriend over to show her.  She suggests running down and getting it, but he says, no, let’s wait.  Next you see a frizzy headed guy down on the green who screams, “MONEY!!!!”  In seconds, people came out of the woodwork and scoffed up all the money while the young couple looked on.

The image of that commercial popped into my head as I considered the job summit being led by President Obama.  To me, the young couple represented the government pondering how to direct the economy to achieve this specific goal or that.  The mob on the green was the free market.  While the government dithers over what kind of legislation to write, which special interest groups to pay off to pass it, how to develop incentives to get private industry to do this or that, if they would just cut taxes and get out of the way, the free market would get to work creating jobs where they are needed, not where some bureaucrat thinks they should go.

Uncertainty

The biggest cloud overhanging this economy is uncertainty.  The Obama administration is slamming through enormous changes: a $787 billion Porkulus package, cap and trade, health care.  Businesses look at this combined with the accumulation of massive government debt, tax increases rather than cuts (yes letting the Bush tax cuts expire is a tax increase, not just the expiration of tax cuts as Speaker Pelosi tries to spin it) and they don’t know what hiring that extra employee is going to cost, let alone what it will cost to keep the employees they already have.  So they don’t hire until the dust  settles and they can calculate the impact.

“Tax incentives for job creation are “worthy of further consideration,” he said, while adding that the administration is also set on making a big push in the area of green jobs.” – President Obama at Jobs Summit

“Worthy of further consideration”?  Since conservatives have been calling for tax cuts for a year now, this kind of statement in Obama-ese translates thusly, “I have to make a nod to the right, to acknowledge that I heard them, but it ain’t happening.”  Couple that with the “big push in the area of green jobs.”  We are in the midst of the scientific scandal that the “settled science” of man-made global warming could be the greatest hoax since Bernie Madoff, and Obama wants a big push in the area of green jobs.  What if that area collapses because the urgency that Al Gore has been screaming about is no longer urgent?  It’s government planning on the order of Soviet five-year plans or Mao’s Great Leap Forward programs.  It harkens back to Jimmy Carter’s giant Synfuels project that was going to convert coal into oil, until oil prices fell and the project imploded, but not before billions of tax dollars were poured into that rat hole.

How Simulating!

If you listen to Joe Biden, the stimulus plan is working better than expected.  But let’s take a closer look.  As of about three weeks ago only $120 billion of the stimulus money had been spent. (So why is Congress looking at another stimulus with over $600 billion left to spend in the first one?)  Of that money, 80% went to the Department of Education, Health and Human Services, and the Department of Labor.  What about all the “shovel ready” projects?  Only about $4 billion has gone to the Department of Transportation.  Feel better?

Jobs Summit Attendees

So who is meeting with President Obama at the jobs summit?  Well first let’s look at who was not invited:

• U.S. Chamber of Commerce — they have butted heads with Obama over health care and climate change policies
• National Federation of Independent Businesses

I don’t know about you, but I think they might have an idea or two about how to create conditions that let the free market create jobs.  As for the attendees:

• Service Employees International Union (SEIU) officer
• President of the American Federation of Teachers — a union of workers in a government run monopoly
• United Food & Commercial Workers International Union
• CEOs of some Fortune 500 companies

How many jobs do unions create, not occupy, create?  Think of the auto industry, steel industry, public K-12 education, the Postal Service, and government in general.  Do they bring images of thriving, vibrant, engines of job creation?  Or is the image more of the basket cases of the U.S. economy?  This is not a slight against the union workers themselves, but rather of their leadership who create so many restrictions on job rules to artificially create the need for more jobs.  There motto is: why have three people do the work, when you have five do it?

As far as big business is concerned, let me dispel the thought that conservatives and big business go hand in hand.  In many cases big business looks to cut deals with the government to protect their industries and markets from upstart companies.  They have gotten big and lethargic, rather than nimble and vibrant.  Small businesses create about 80% of the jobs in the U.S. and they didn’t have a seat at the table.

So was the jobs summit about creating jobs or just jive talk?  If you want a real jobs summit see what American Solutions was hosting in Cincinnati, Ohio and Jackson, Mississippi.  They actually discussed ideas that would work.

The New York Times had some, what was to me, shocking news today.  The article said that there was now consensus that the Obama stimulus plan was working.  Is this the same kind of consensus that man-made global warming was settled science, despite the glaring evidence that carbon dioxide emissions continue to grow while the globe stopped warming ten years ago?  This is also close on the heels of breaking stories of extraordinary misinformation if not outright deceit on how the $787 billion is being spent.

Smoke and Mirrors

Early on in the article we have this gem:

“The legislation, a variety of economists say, is helping an economy in free fall a year ago to grow again and shed fewer jobs than it otherwise would. Mr. Obama’s promise to “save or create” about 3.5 million jobs by the end of 2010 is roughly on track, though far more jobs are being saved than created, especially among states and cities using their money to avoid cutting teachers, police officers and other workers.”

There is no mechanism that exists to measure a job saved. None.  So how do they do it?  It goes something like this:

“Here, Mr. Stimulus Funds applicant, I have this check for you for $642,000.  No can you tell me, if I give this to you, how many jobs would you create or save?”

“Create? Er, none.”

“Hmmm,” the bureaucrat mutters, staring down at the check in his hand, “what about jobs you would save?  You know, if I don’t give you this nice, rather large check, how many of your people would you be forced to lay off?”

“Oh, I get it,” the potential recipient says with a wink and a smile, “probably all of them!”

The bureaucrat scribbles down a number, and hands over the check, walking away shaking his head.

That’s about how it’s done.  The government surveys the people getting the money and asks them what would have happened if they didn’t get the stimulus.  And what would you expect them to say?  Keep the check?

Revenue Starved States

What a concept, “Revenue Starved States.”  The article complains that not enough money was provided to “Revenue Starved States.” Does he mean states like California and New York?  I believe the correct term is states where spending is out of control.  It means states where taxes are so high that people are moving out in droves, and among them the “wealthy” people they love to tax to the eyeballs, meaning a dramatically shrinking revenue base.  After all, if one of the wealthiest people in the state, who is part of the group that pays 70% of the taxes, moves out of the state or (out of the country when it gets bad enough), that means a lot of people are going to see their taxes raised to make up for it.  So the statists seem to think a stimulus package that keeps these bloated bureaucracies fat, dumb and happy is the way to go, until when exactly?

The Multiplier Fallacy

The other great fraud being foisted on us is the multiplier effect, where for each dollar of stimulus money spent more than a dollar of economic activity results:

That sort of impact is what makes federal aid to state governments rank high in economists’ reckoning of the stimulus value of various proposals. Every dollar of additional infrastructure spending means $1.57 in economic activity, according to Moody’s, and general aid to states carries a $1.41 “bang” for each federal buck.

Even more effective are increases for food stamps ($1.74) and unemployment checks ($1.61), because recipients quickly spend their benefits on goods and services.

Okay, then how is this for a solution.  Let’s spend $10 trillion on infrastructure, food stamps and unemployment checks, since they will result in $15 trillion or so in economic activity, because of the multiplier, right?  For that matter, let’s have the government spend $100 trillion and we’ll really be rocking.

Where’s the So Called Consensus

From what I read in the article, there was only one economist that could be called a conservative, Martin Feldstein, that they were willing or able to quote, and this was his take on the stimulus.

While some conservatives remain as skeptical as ever that big increases in government spending give the economy a jolt that is worth the cost, Martin Feldstein, a conservative Harvard economist who served in the Reagan administration, said the problem with the package was that some of its tax cuts and spending programs were of a variety that did little to spur the economy.

“There should have been more direct federal spending that would have added to aggregate demand,” he said. “Temporary tax cuts and one-time transfers to seniors were largely saved and didn’t stimulate spending.”

That’s it?  That’s the consensus?  It seems to me that he is pointing out what was wrong with the package rather than what was right.  He was in the Reagan administration and he knows what works: permanent cuts in marginal tax rates. Those dreaded tax cuts for the “rich.”  The thing is that when the people above the subsistence level get to keep more of what they earn, yes it does belong to them and not to the government, they tend to invest it, which means the provide capital to businesses that grow and create jobs.  Yes, capitalism.  What the stimulus does is take money away from these people, or borrows it and steals it from future generations, and gives that money, as in the example above, to highway projects, food stamps and unemployment checks.  The first of these may create jobs until the road project is completed, but the latter two only increase the dependency of those recipients on the government.  So how exactly does the stimulus plan that puts money into a highway project and unemployment benefits, help a banker who got laid off?  How does it help the unemployed executive from United Technologies?  It doesn’t.  It’s like a drug fix.  You may feel good for a while, but then it wears off and you need another fix.

The Genius of Government

You would think that with all the examples of government planning lying on the waste heap of history, the statists will finally catch on that they can’t successfully pick the winners and losers in an economy.  Government has to get out of the way and let the market work.

Government must be drastically cut down to size.  Think of the popular TV show “The Biggest Loser.” Picture the governments of the United States, California, New York, New Jersey, Rhode Island, Michigan, Nevada, for starters, as contestents.  Let’s see who can lose the most weight.  Ready? Go.

Just what is a czar anyway?  And I am not talking about the Russian royal family.  A czar is essentially a presidential advisor.  Take a moment to think about that.  Why does President Obama need to appoint 32, give or take, czars in his administration?  Could it be that he really, really needs a lot of advising?

In the campaign, the main stream media, somehow diverted the attention away from Obama’s glaring lack of experience as the Presidential candidate and put all their focus on Sarah Palin’s “lack of experience.”  Sarah Palin had more executive experience as a sitting governor and I emphasize executive experience, than Obama, Biden, and McCain combined.

But the media tut-tutted, and said “it’s only Alaska,” as for her mayoral experience, “it was a very small town.”  When Obama slipped his teleprompter and tried to claim he was running a very large organization, his campaign, it was laughable.  But don’t worry, he had Joe Biden to lean on.  I feel better.

Presidents and The Experience They Brought With Them

Let’s take a look back at past elected presidents and the executive experience they brought to office:

• George W. Bush — Governor of  Texas
• Bill Clinton — Governor of Arkansas
• George H. W. Bush — Vice President of the United States, Head of the CIA
• Ronald Reagan — Governor of California
• Jimmy Carter — Governor of Georgia
• Richard Nixon — Vice President of the United States
• Lyndon Johnson — Vice President of the United States
• John F. Kennedy — None.  He was a legislator and his inexperience nearly got us annihilated with the Cuban Missle Crisis, following the Bay of Pigs, and an embarrassing showdown with Khrushchev
• Dwight D. Eisenhower — Five star general in command of all Allied Forces in Europe in World War II
• Harry Truman — Vice President of the United States
• Franklin D. Roosevelt — Governor of New York , Secretary of the Navy
• Herbert Hoover — Secretary of Commerce
• Calvin Coolidge — Vice President of the United States, Governor of Massachusetts
• Warren G. Harding — Lieutenant Governor of Ohio
• Woodrow Wilson — Governor of New Jersey, President of Princeton University
• William Howard Taft –  Secretary of War
• Theodore Roosevelt — Vice President of the United States, Governor of New York, Assistant Secretary of the Navy

Legislators Versus Executives

So, from the beginning of the 20th Century until the election of Barack Obama, only once has a  president with only legislative experience been elected, John F. Kennedy.  Nikita Khrushchev took advantage of Kennedy’s inexperience in their first summit in Vienna, and then there was the aborted Bay of Pigs invasion of Cuba and the attempted overthrow of Castro.  On top of those two building blocks we got the Cuban Missile Crisis, which brought us closer than we have ever been to thermonuclear obliteration.

The Eternal Campaign

President Obama is no different.  He has the least experience of any president since 1900.  He effectively was only a United States Senator for two years, as he was busy campaigning for the next two years and resigned his last two years after being elected president.  So what does he do?  He does what he is comfortable doing and what he is good at, campaigning.  He has held more press conferences in six months than his predecessor did in eight years.  Who is running the show while Obama is running around?  Is it Nancy Pelosi?  Rahm Emmanual?  His programs are falling apart.  The stimulus isn’t working and more Americans say that it has hurt the economy rather than helped it (31%-25%) and that the rest of it should be canceled.  His cap and trade plan is opposed by most Americans (56%) who don’t want to pay more in taxes to fight global warming.  His government takeover of our health care is opposed by most Americans (53%-44%) and yet he presses on, figuring that with enough campaigning the American people will be won over.

This may be a long slog, waiting for 2012 and hoping our country does not get destroyed by all the power grabbing characters in Congress, who don’t care a whit about us, only about increasing the powerful control they have over our lives.  We have tothe fight of our lives on our hands preventing the taking of our liberties.

WE SAVED THE ECONOMY!

President Barack Obama announced last night at his press conference that his policies have brought the economy back from the brink of collapse. ( Obama Talks About the Economy).  So I guess it’s Mission Accomplished!  Despite unemployment climbing toward 10% when he promised he could hold it at 8% if we implemented his stimulus package and that it would be 9% if we didn’t.  With only 3/4 of the fiscal year over, we already have a deficit in excess of $1 trillion dollars for the first time in our history.  The House passed a Cap and Trade bill that will, if implemented, add to the cost of everything that uses energy, just don’t call it a tax because only Bill Gates and Warren Buffet will be taxed under the Obama Administration.  On top of that, we absolutely must nationalize health care to cut the cost of health care and increase coverage.  The only problem is that the CBO says it will increase costs and reduce the amount of care.

What’s the Mission

If you are foolish enough to think that Obama’s policies are failing, then you don’t know what the mission is.  The mission is not to fix the economy.  It is not to curb global warming.  It is not to make health care more affordable.  It is to increase the size and scope of government to a point where it can never be rolled back.  Our liberties will be crushed and we will be ruled by a cadre of bureaucrats who will tell us what we can do and when we can do it.  He will form a block of voters that can get him and his fellow Democrats elected in perpetuity, by showering them with government handouts and place punishing taxes on a minority of productive people.  Why do you think he is smiling in the picture?  His mission is proceeding just as planned, thank you very much.  He only hopes that it is too late before you realize what happend to you and your rights.

Remember the stimulus package that had to pass immediately or we would face economic catastrophe?  Recently released data from the Commerce Department show that the economy was recovering before the stimulus went into effect.  Unemployment has risen above what the Obama administration said it would if the stimulus passed, but oh well, Congress approved and the president signed the legislation to spend $787 billion of your money.

The Next Boondoggle

Now President Obama is trying to ramrod through the Cap and Trade legislation that will put another enormous burden on taxpayers and we have to do this now, immediately, imperatively, or south Florida will be under water and polar bears will be extinct.

A 98 page report from a veteran in the EPA garnered this response from his boss, Al McGartland:

“‘The administrator and the administration has decided to move forward on endangerment, and your comments do not help the legal or policy case for this decision,” he wrote, according to the e-mails released by CEI. “I can only see one impact of your comments given where we are in the process, and that would be a very negative impact on our office.’ ”

Who is the EPA working for?  Is this a government of the people or of the statists?  So because they won the election, the policies of their most extreme supporters must be put in place, no matter how large the bill or how effective the policy.  If it is a sham, too bad, they want it…they shall have it and you get stuck with the bill, the loss of liberty, and them telling you how to live your life.

The Problematic Report

Here is the essence of the report , written by EPA scientist Alan Carlin,  that the EPA finds so damning:

Carlin compiled a 98 page report that pointed to some inconvenient facts that call the connection between CO2 emissions and global temperature into doubt, at a time when the President is pushing “urgent” carbon emissions regulation through the Congress. From FOXNews.com:”Specifically, the report noted that global temperatures were on a downward trend over the past 11 years, that scientists do not necessarily believe that storms will become more frequent or more intense due to global warming, and that the theory that temperatures will cause Greenland ice to rapidly melt has been ‘greatly diminished.’ ”

But hey, on the other side of the ledger you have Al Gore and he has a Nobel prize and an Academy Award, so who are you going to believe?

The global warming threat may be in the process of being debunked but the fiscal threat from the Obama Administration will cause far more damage if we don’t take urgent steps to stop them.

Democrats Lining Up to Vote for Cap and Trade

The tide is turning against the case for man-made global warming.  An article in today’s Wall Street Journal has the following:

“Among the many reasons President Barack Obama and the Democratic majority are so intent on quickly jamming a cap-and-trade system through Congress is because the global warming tide is again shifting. It turns out Al Gore and the United Nations (with an assist from the media), did a little too vociferous a job smearing anyone who disagreed with them as “deniers.” The backlash has brought the scientific debate roaring back to life in Australia, Europe, Japan and even, if less reported, the U.S.” — The Climate Change Climate Change, WSJ, June 26, 2009

So if the case for controlling CO2 emissions is gaining skeptics, what would a reasonable person do?  They would probably pause and listen to see if they should alter their position based on this new information.  What do the statists do?  Double their efforts to jam this gargantuan tax bill through Congress, again without reading it because it’s too big, before the American people find out just how monumentally stupid it is.

Nancy Pelosi, Henry Waxman, and Ed Markey are the lead lemmings jumping into the sea and expecting all of us to follow.  You see, if they can slam this thing in they will have enormously increased their power and make it very difficult to unwind this monstrosity.  Their disdain for what is right for this country and what is best for the American people is truly astounding.  Their arrogance and sense of empowerment knows no limits.

Scientists Speak Out

Far from Al Gore’s pejorative and dismissive label of “deniers”, some real scientists weigh in:

“The number of skeptics, far from shrinking, is swelling. Oklahoma Sen. Jim Inhofe now counts more than 700 scientists who disagree with the U.N. — 13 times the number who authored the U.N.’s 2007 climate summary for policymakers. Joanne Simpson, the world’s first woman to receive a Ph.D. in meteorology, expressed relief upon her retirement last year that she was finally free to speak “frankly” of her nonbelief. Dr. Kiminori Itoh, a Japanese environmental physical chemist who contributed to a U.N. climate report, dubs man-made warming “the worst scientific scandal in history.” Norway’s Ivar Giaever, Nobel Prize winner for physics, decries it as the “new religion.” A group of 54 noted physicists, led by Princeton’s Will Happer, is demanding the American Physical Society revise its position that the science is settled. (Both Nature and Science magazines have refused to run the physicists’ open letter.)”  — The Climate Change Climate Change, WSJ, June 26, 2009

Can you feel your liberties slipping away as those in power do what they want rather than representing us.  Sounds like it’s about time for a tea party.

As I continue to read the book I mentioned in my last post, I become more wary of the politics surrounding it.  Man’s contribution to global warming is “settled science”, or in other words, no more debate folks the discussion is closed.  The suggestion from a politician in Australia that any Australian that doesn’t believe in man made global warming should be stripped of their citizenship until the are re-educated.  Does that kind of talk scare you?  It scares me.  The American Meteorological Society (AMS) has issued a statement on climate change that reads:

“There is convincing evidence that since the industrial revolution, human activities, resulting in increasing concentrations of greenhouse gases and other trace constituents in the atmosphere, have become a major agent of climate change.”

Heidi Cullen, the Weather Channel’s climatologist believes that any meteorologist who carries an AMS certification should lose that certification if they do not toe the company line.  If their science and their logic are so convincing, why resort to the threats and coercion?

There is an alternate theory that is not even addressed in the book and that is that the temperature increase that we are seeing is caused by solar activity.  In the book the author touches on the effect of the sun, but only with regard to the position of the earth relative to the sun, not solar activity and since the position hasn’t changed that much, he says it is not a factor.  But it is not the position of the sun that is the factor, it is the amount of solar activity.  There have been very high levels of solar activity between 1940 and 2000.  That activity has since decreased and has been low for several years now.  If you listen carefully you will hear news stories that global warming peaked about ten years ago.

The book states that from 1990 to 1999 global CO2 emissions increased at a rate of 1.1 percent per year.  In the years 2000 to 2006, the rate tripled to over 3 percent per year.  So with such a dramatic increase of CO2 being released into the atmosphere and it being “settled science” that CO2 causes global warming, why did the temperature peak in 1998, and begin falling while the amount of CO2 being pumped into the atmosphere accelerated?  Another study concludes, “if you shut down all the world’s power plants and factories, ‘there would not be much effect on temperatures.’”

My concern is that we have a rush to solve a problem that may no longer exist, or worse may be going in the opposite direction, and our “leaders” are clamoring for massive spending and changes to our economy.  But what about all the proof of CO2 emissions leading to increases in temperature?  The question should be what is the cause and what is the effect?  Has the increase in CO2 caused the increase in temperature or has the increase in temperature, caused by solar activity, led to an increase in CO2?

The author unintentionally makes this point when he mentions that increasing temperature in the oceans caused CO2 to bubble up and be released into the atmosphere.  He also mentions that if the arctic tundra should start to thaw then methane, which is a more potent greenhouse gas than CO2 will be released into the atmosphere.  I think he was trying to say that an acceleration effect would occur where CO2 warms the earth and thereby releases more CO2, but if this was the case we would have baked long ago.  There is a study that indicates that based on past data going back 250,000 years that CO2 concentrations actually lag temperature change, meaning the temperature increase caused the CO2 increase and not the other way around.

With this in mind, any proposal to immediately change to renewable fuels on a massive scale could actually have the opposite effect.  I believe we should convert to renewable fuels when and as they become economically viable.  We recently saw a dramatic climb in the price of a barrel of oil.  With that there came an economic incentive to switch to hybrid cars, build wind farms, install solar systems, etc.  With the housing bubble and the subsequent fall off in economic activity, the price of a barrel of oil has decreased just as dramatically.  Sales of hybrids have sharply curtailed.

So if we artificially push to change from oil to renewable energy now: 1) it will be disruptive to the economy; 2) if the Indians and Chinese do not increase their consumption as fast or faster than we would wean ourselves off, the price of a barrel of oil will continue to fall.  As the price of a barrel of oil falls, the economics of renewable energy will get worse not better, and therefore more coercion would be required through tax incentives and regulations to continue the process.

I believe we should put our energy in driving down the cost of the technolgy through manufacturing improvements and R&D, so that alternative energy can compete with fossil fuels without subsidies, and let the market determine the pace of the conversion.  We tried the massive government energy program with the Synfuels Project in the late 1970s and every one of those projects failed because they were not economically viable. An enormous amount of money was spent in that effort but it was shut down.  Command and control economies do not work, the collapse of the Soviet Union and the injection of capitalism in China have proved that.  Markets do work, if artificial constraints are not placed upon them by bureaucrats.