Photo by Dave Makes

Two news items yesterday, when put together, start to tell an interesting story. Warren Buffett invested $5 billion in Bank of America in a private sweetheart deal that will guarantee him a 6% return (that’s $300 million per year) and he is hosting a fund raiser for Barack Obama in New York where the tickets start at $10,000. What’s going on?

Barack Obama is the worst jobs president since Herbert Hoover (see previous post on this); the economy is flat lining; and yet Buffet thinks Obama is doing a great job. Think of some of Obama’s other supporters among the captains of industry: Jeffrey Immelt of GE and Howard Schultz of Starbucks.

Crony Capitalism

What is crony capitalism? Crony capitalism is where we have a capitalist economy but instead of truly free markets, some business leaders get cozy with government to tilt the playing field in their favor. Those on the left like to paint conservatives as the champions of big business and the wealthy, but if you look at the campaign contributions of many big business CEOs you will be surprised at who they support. Let’s look at two examples, Warren Buffett and Jeffrey Immelt.

Warren Buffet

In the financial meltdown triggered by the housing bubble bursting, the government stepped in to prevent large financial institutions from failing. This creates what is known as a moral hazard. A moral hazard is where the risks associated with a particular transaction are covered by someone else such as the government or insurance, so the investor is willing to take overly large gambles. Why? Generally, the bigger the risk, the bigger the payoff if you are right and if the downside is protected by government or other parties you have less to lose. Big upside, small downside, let’s play!

Warren Buffett invested in Goldman Sachs in the midst of the financial crisis in 2008, as a result of his $5 billion investment he reaped “$10 billion in interest, fees, and dividends,” according to Mark DeCambre at the New York Post. If you know that the government won’t let the bank fail, what is your downside risk? The upside turned out pretty sweet. Warren Buffett was an adviser to candidate Barack Obama and you can be sure the topic of how to handle the fiscal crisis was discussed. Buffett is now investing in Bank of America where his company, Berkshire Hathaway stands to make another killing. Would the government stand by and let Bank of America go under? What do you think?

Warren Buffett has also been making the rounds calling for more taxes on the rich. This writer and others have suggested that if Warren Buffett thinks the government deserves more of his money, go ahead and write the check, but he balks at that suggestion. Why? Depending on when you measure it, Warren Buffett is one of the three richest people in America. No matter how high to raise the tax rates, he will be able to afford it. Other entrepreneurs and small businesses may not be able to afford the higher taxes and thus find their companies financially squeezed. Buffett’s company Berkshire Hathaway has made a lot of money buying up good companies. Could his high tax advocacy be a way for the government to create some new investment opportunities for him?

Buffett has also invested in a Chinese company to build electric cars. Why didn’t he invest in GM to help sell the Chevy Volt? In the midst of this lousy economy President Obama announces new CAFE standards that would require car companies to build cars that would get over 52 miles per gallon by 2025. That will probably drive GM and Chrysler out of business with their heavily unionized companies already at a severe cost disadvantage of around $2,000 per car. What a great opportunity this would create for a company with an electric car! Slap a GM or Chrysler nameplate on it and voila, problem solved.

Jeffrey Immelt

For all the talk about higher taxes, General Electric paid no taxes in 2010. During the fiscal crisis GE got large sums of money from the government.

During the wild Congressional spending spree of the last couple of years, GE miraculously became the largest beneficiary of the government’s Troubled Asset Recovery Program (TARP) bank bailout. Although GE did not initially qualify for TARP, the company’s $18 million annual investment in battalions of Washington DC lobbyists convinced Administration regulators to push that “reset” button and extend TARP guarantees and subsidies to GE. Public records demonstrate GE Capital, the company’s massive financing arm, pocketed $120 Billion in loans from the Federal Deposit Insurance Corporation at interest rates of less than 1% and snatched 25% of the entire $340 billion in subsidies from “Temporary Liquidity Guarantee Program” (TLGP) rescue fund. — Chriss W. Street

Immelt has also been appointed as the head of President Obama’s job council. At the same time Immelt is entering into an agreement with China to build airplanes to compete against Boeing. Meanwhile do you recall Boeing and the government being in the news lately? Well the National Labor Relations Board has told Boeing that it cannot open another factory that will hire 5,000 employes in South Carolina. In the midst of 9% unemployment, Obama said that the NLRB was an independent agency and his hands were tied. How convenient?

What’s that Smell?

While the engines of job creation, small businesses, are stuck wondering what will hit them next, the crony capitalists are cozying up to President Obama and getting fat while stymieing their competition. I don’t know if this is illegal or not, but how much different from insider trading, at least from appearances, is this? The heads of major corporations give advice to President Obama, go out and make spectacular deals, and the economy continues to languish while they get rich. They get rich not because they have a better idea, or are more nimble, but because taxpayers are absorbing much of the risks while they make the dough. Perhaps Congressman Issa can use his Government Oversight committee to ask a few key questions.

That’s my opinion; I’d like to know yours. Please comment below.

This is a story you are not likely to hear about from the mainstream media. As previously reported on this site the Obama administration, led by Hillary Clinton, came down hard on the sovereign country of Honduras for upholding their constitution and fighting against a Chavez style, “leader for life” power grab by their president Manuel Zelaya.

To summarize, Honduran President Manuel Zelaya was coming up against term limits. His buddies, Hugo Chavez in Venezuela and the Castro brothers in Cuba, wanted to help Zelaya transform Honduras into another socialist enclave.  The Honduran legislature and Supreme Court blocked his efforts as unconstitutional. When the head of the army tried to enforce the ruling of the Supreme Court, Zelaya fired him and then with his thugs stole referendum ballots from an air force base where they were being held after the Supreme Court ruling.

Zelaya was removed from office and exiled. The presidential elections proceeded on schedule, a new president was elected and democracy was preserved. As a result of the commotion an inquiry panel of the Organization of American States (OAS) was formed to investigate what happened. Here are some of the conclusions they reached.

“the political crisis was set off” in January 2009. That’s when officials from the president’s office met with congressional members of his own Liberal Party and “threatened them with the rupture of the constitutional order if they did not choose—as supreme court justices—lawyers who were not on the list of 45 supreme court candidates” officially nominated through a legal selection process. According to the full report, Mr. Micheletti testified that U.S. Ambassador Hugo Llorens was party to this pressure on Congress to break the law.

Why is American Ambassador Hugo Llorens pressuring legislators in Honduras  to break the law and to pack the Honduran Supreme Courts with Zelaya puppets?

The report also says that ahead of the crisis, the international community did nothing to help defend the democracy. On the contrary, the OAS decided to send a mission for the referendum, “despite the fact that every state institution with competency in the matter had issued resolutions that it was illegal and that it should not take place.”

When the Honduran government acted against its rogue president, Hillary Clinton immediately labeled it a coup d’etat and pulled the visas of the fifteen members of the Honduran Supreme Court so they could not travel to the U.S. So why does the United States immediately come to the defense of Manuel Zelaya who is backed by Hugo Chavez and the Castro brothers instead of the rule of law? Everyone who has looked into this has come down on the side of the Honduran government and democracy.

There are many people who are bending over backwards to claim Barack Obama is not a socialist merely because he hasn’t taken over all of the means of production. When it starts to rain, I don’t need to wait until I am drenched to head for cover. This is just one more piece of the puzzle that this is someone we have to get out of office in November of 2012, before he does more damage than we can recover from in our lifetime.

That’s my opinion; I’d like to know yours. Please comment below.

Extremism in the defense of liberty is no vice. – Barry Goldwater

“I always use the word extreme, that’s what the caucus instructed me to do the other week, extreme cuts and all these riders, and Boehner’s in a box but if he supports the Tea Party, there’s inevitably [be] a shutdown.  – Senator Charles Schumer (D-NY)

From a partisan point of view, I think it would be the best thing in the world to have a shutdown. If I was head of DNC, I would be quietly rooting for it. I know who’s going to get blamed – we’ve been down this road before.” – Howard Dean, former DNC Chairman

http://www.youtube.com/watch?v=tLuDFYPVC5s

Well there you have it. Republicans are fighting alongside the Tea Party to defend liberty. The Democrats after spending us into oblivion, mortgaging the future of our children and grandchildren, want to do everything possible to keep the money flowing from your pockets, through Washington, to their supporters who will come out on Election Day and keep them in office.

They have no interest in solving the problems they got us into. As they flounder looking for a way out of the hole they keep digging, is seems that after every shovel full they say, on cue like a Greek Chorus, “Bush’s fault,” but the hole keeps getting deeper and Bush is nowhere in sight. President Obama’s on the job training textbook was written by FDR so if unchecked we can look forward to being in this mess for years to come. The good news is that the Constitution will save us in 2016, if we don’t wake up and save ourselves in 2012. So which side are you on, liberty or tyranny?”

That’s my opinion; I’d like to know yours.  Please comment below.

The latest news on the economy is not encouraging: a mere 39,000 jobs added and the unemployment creeps ever closer to 10% at 9.8%.  In spite of this, or apparently ignorant of it, the lame duck House voted yesterday for another whopping tax increase on the most productive among us. Yes, yes, they will beat the class warfare drums about tax “cuts” for the rich, when what they are voting on is not a cut at all, but either leaving things the way they are or raising taxes.  With the recovery barely showing a pulse, it is not the time to take money out of the hands of free market capitalists and put it in the hands of the government.  Who do you think can pull the economy out of the doldrums, entrepreneurs or government bureaucrats?

The “We’re For the Little Guy Myth”

We learned yesterday that Peter Orzag, the former White House Budget Director, may be taking a job at Citibank.  You remember Citibank, they got $45 billion in a taxpayer bailout.  The actual job is unimportant.  What is important for Citibank is having a guy on the payroll who can call the White House and they’ll take his call.  They guy who replaced him as budget director, Jacob Lew, worked at Citibank from 2006 to 2009. 

How about some more cronies?  There is former Treasury Secretary under Clinton, Robert Rubin who became an executive-committee chairman at Citigroup.  Treasury still owns 11% of Citi stock.  As Obama raked in the campaign cash from Goldman Sachs, we have Timothy Geithner’s replacement as head of the New York Fed, William Dudley, was a former chief economist at Goldman Sachs.  Former Democrat senator and Governor Jon Corzine was a previous chairman of Goldman Sachs.

But don’t worry the Democrats are looking out for the little guy.  They ignore Fannie Mae and Freddie Mac in the financial regulations overhaul and hand the bill to the little guy.  They bail out GM and Chrysler, turning over the bulk of the company’s ownership to the unions and hand the bill to the little guy.  TARP money goes to foreign banks to cover their losses and they hand the bill to the little guy.

Crony Capitalism Reality

The reality is that Progressives like crony capitalism.  After all, how can they possibly mount effective political campaigns without money?  From the little guy?  Forget it.  They make deals with big business.  They protect the big guys from competition from the free market capitalists and the big guys pour money into Democrat coffers.  Think of all the money that flowed into Wall Street.  Why?  Because they were “too big to fail”.  How many small and mid-sized banks were shuttered?  Since 2008 there have been 314 bank failures in the U.S., only 18% of those had assets of over $1 billion. 

The big guys can take enormous risks and if they pay off they make enormous profits and personal wealth for their management.  But if the risks don’t pay off, do they go out of business?  Hardly.  They go to the government with dire predictions of a collapse of the economy unless the government steps in and when it does, the bankers get their big bonuses and the little guy gets stuck with the bill.

Meanwhile Back at the Fed

If the Democrats are not trying to destroy the economy through fiscal policy, then they give monetary policy a try.  Take a look:

httpv://www.youtube.com/watch?v=PTUY16CkS-k

The New Congress

The Republicans are ready to take control of the House in January and narrow the majority of the Democrats in the Senate.  They have stumbled badly before when they were in the majority, but in their four year timeout, it appears they have learned something.  They seem to be on the right track and we hope they remain so.  We’ll be watching.

As is the case every ten years we take a census of the population of the United States, as required by the Constitution.  After the census is taken the seats in the House of Representatives are shuffled to accommodate for shifts in population between the states.

So what does this all mean?  In a previous post focusing on the Senate we showed that currently twenty-one Democrats and two independents who caucus (meet and generally vote with) the Democrats will be facing election in 2012 compared to only ten Republicans.  In the House, everyone is up for re-election every two years.  So after picking up 60 seats, or thereabouts as some races still haven’t been decided, where do the two parties start off as a result of reapportionment?  Although final numbers won’t be in until December, it doesn’t look good for the Democrats.

The Democrat strongholds remain on the East and West coasts and in the Rust Belt around the Great Lakes.  The Republican strongholds are the rest of the country.  The dismal economic policies of high taxation and bigger government, are taking their toll and here are a couple of examples.

Rush Limbaugh, perhaps the most hated man on the left, had a residence in New York and paid New York taxes.  On one of his programs he talked about getting out of the state to avoid the high taxation.  New York desperately depends on its wealthy citizens to fund the state and New York City government, particularly the Wall Street crowd.  Instead of trying to persuade Mr. Limbaugh to stay by pointing out the attractions of living in New York, officials tried to endear themselves to their left wing base by taunting him and daring him to leave.  Leave he did, taking his tax revenues with him.

If you look at the cost of renting a truck from U-Haul to move from Texas to California or vice versa, the rates are informative:

From Dallas to San Francisco: $734
From San Francisco to Dallas: $2,116

From Houston to Los Angeles: $706
From Los Angeles to Houston: $2,051

Any student of supply and demand will quickly see the message contained here.  The cost of a truck heading to Texas is nearly three times the cost of a truck going the other way.  Apparently, there are plenty of trucks available in Texas for those who want to move to California, but no one who wants to make that move.  Conversely, there are scant few trucks to help people get the hell out of California before it implodes, but plenty of people bidding the rental price of a truck up.

The Policies in Action

Now that we have touched on the Blue state policies, what is likely to happen?

Blue States – Net loss of seven seats

• Massachusetts to lose one seat
• New York to lose two seats
• New Jersey to lose one seat
• Pennsylvania to lose one seat
• Michigan to lose one seat
• Illinois to lose one seat
• Iowa to lose one seat
• Washington gain one seat

Toss Ups – Net gain of one seat

• Ohio to lose two seats
• Nevada to gain one seat
• Florida to gain two seats

Red States – Net gain six seats

• Missouri to lose one seat
• Louisiana to lose one seat
• South Carolina to gain one seat
• Georgia to gain one seat
• Texas to gain four seats
• Arizona to gain one seat
• Utah to gain one seat

If you look at the toss ups, categorized as such because they voted twice each in the last four Presidential elections for the Democrat and the Republican candidates, Florida is a key state.  Florida will gain two seats and at the same time it just elected a Republican governor and a Tea Party senate candidate Marco Rubio.  If they can pull Florida solidly into the Republican camp, that could mean another two seats for the Republicans.

So without a ballot being cast it looks pretty positive that the Republicans will start off the 2012 House election with a six to eight seat advantage on top of the sixty to sixty-five or so they just won. 

There is no certainty that this will play out along these lines.  After all the Democrats could flip several seats in their strongholds if all the Republicans grab those U-Haul trucks and head for friendlier, liberty loving states.  Conversely those freedom seeking migrants might move into districts that are now held by Democrats in the South and flip them to the Republican column. 

The key thing for the Republicans to have continued electoral success is to stick to what you ran on without any backsliding.  I can assure you that the Tea Party will either have your back or be breathing down your neck.  You pick

President Obama, during his 2010 State of the Union address, did the unprecedented, which I suppose should surprise no one.  He called out the Supreme Court, whose members were seated in front of him, and lambasted them on a recent decision called Citizens United v. Federal Elections Commission.  The outcome of the case was that free speech was not limited only to individuals but could include corporations, groups of individuals, etc.  As Justice Scalia pointed out in his concurring opinion, the First Amendment refers to speech not speakers.

Protocol suggests that you do not invite guests to your event and then mock them, to the standing ovation of fellow uncouth Democrats.  In the video of the event Justice Samuel Alito can be seen mouthing the words “untrue”

http://www.youtube.com/watch?v=k92SerxLWtc

The law President Obama urges Congress to pass became known as the DISCLOSE act.  Democrats only like free speech for their special interest groups and to bar those who might campaign against them.  Liberty’s Lifeline has always advocated for anyone, except foreigners,  to give any amount to any candidate as long as it was published on the Internet within a reasonably brief period of time, say, 48 to 96 hours.  Tim Bishop voted for the DISCLOSE act but who has been giving money to Tim Bishop?

Charlie Rangel the disgraced Congressman from Harlem who was chairman of the House Ways and Means committee that writes the tax laws, gave $15,000 to Mr. Bishop over the years.  It seems that the head of the tax writing committee has problems remembering to pay his own taxes and he also has not one, not two, not three, but four rent controlled apartments, despite having a base salary of $174,000 per year.  He says failure to pay his taxes was an honest mistake.  Try that defense with the IRS if you forget to pay your taxes.  When the scandal became more pronounced and calls came for Mr. Bishop to return the tainted funds, did he do it?  Not exactly.  Mr. Bishop made a decision.  He could have given back the funds, but what mileage could he have gotten out of that?  Instead he donated the funds to two veterans associations.  That would be a noble gesture if Mr. Bishop donated his private funds for that purpose.  In July, 2010 Mr. Bishop’s campaign blasted one of his challengers Christopher Cox for saying that Mr. Bishop pocketed the funds, when the campaign said it had already returned them.  However in the same article it says it gave the funds to the veterans group.  Well, which is the truth and which is the lie?  Did he give it back or did he give it away, to garner favor with another potential voting block?

Bishop has also been called upon to return contributions from Michael Malik, a Michigan resident who contributed the maximum amount to Bishop’s campaign, but who has been fined in the past for illegal campaign contributions, is a partner with the Shinnecock Indians in their efforts to build a casino, and was also involved in a ponzi scheme in Florida, according to Newsday.

Also listed as a contributor to Mr. Bishop is far left billionaire George Soros.  Recently Mr. Soros donated $1.8 million to National Public Radio and shortly after that donation, long time NPR employee and contributor, Juan Williams was fired for expressing his personal views on The O’Reilly Factor.  This is despite Williams having appeared on Fox regularly for a long time.  We will have to see if Mr. Bishop gets behind pulling NPR’s public funding.

It seems Tim Bishop wants to put limits on campaign funding provided it does not affect who funds his campaigns.  Liberty’s Lifeline agrees with full disclosure without picking and choosing who can and cannot contribute.

With just over three weeks to the election, we know one thing about Tim Bishop.  He has a problem with outsourcing.  He doesn’t want to talk about his record, about TARP, the GM and Crysler bailout, the stimulus, Cap and Trade, or ObamaCare.  His entire campaign is about a company his opponent Randy Altschuler founded in 1999 and sold in 2005 that provided business services.  Mr. Bishop, like a magician, feels that if he can keep the voters distracted long enough on outsourcing, he can pull a reelection out of his, er, hat.

httpvh://www.youtube.com/watch?v=WdDOiUzxIXU&hd=1

Transcript:

For those of us who live in New York’s First Congressional district we have seen the ads by Tim Bishop over and over again.  Congressman Tim Bishop, who is running for reelection, is a one trick pony. It’s all about his opponent, Randy Altschuler, starting a company that provided business services.  But the employees were located overseas.  Mr. Bishop doesn’t want to defend his record of eight years in Congress he only wants to talk about outsourcing.

1. The company Altschuler started with a classmate, Office Tiger, was conceived out of the frustration of two men being unable to get their work completed.  They worked at two different companies in the financial services industry. 

 “Both of them were working on their presentations for the next morning at the in-house typing pool. At night, the typing pool would be filled with actors and poets who were moonlighting to make ends meet.  The classmate, Joe Sigelman describes the situation.

“It was three in the morning, and there was this guy who had an audition the next day and was tired and ready to go home because he had a play earlier in the morning. He gave me back my work, but he had accidentally put his script inside my presentation. I was banging my head in exasperation. I called my buddy Randy to share my misery with him. And, he also had exactly the same experience in New York! It was a strange coincidence,” Joe recounted.

The quality of the work was not there because the people in the typing pool were looking for their big break on Broadway, not on producing high quality documents.

Office Tiger was started in September of 1999 when the unemployment rate in the U.S. was 4.2%.  They sold the company to RR Donnelly in 2005 when  the unemployment rate was 5.08%.  Traditionally economists have considered “full employment” to be at 5% unemployment. So what exactly  is Mr. Bishop’s point?  It appears from the graph that it wasn’t a case of outsourcing jobs, it was a case of not enough people available to hire, which was demonstrated by having actors and poets filling the jobs that would normally be done by professional clerical staff. So Mr. Altschuler and his partner sought to fill a need, put their own money at risk, and started the company. Perhaps it is entrepreneurs and capitalists that Mr. Bishop really hates.

Mr. Altschuler also founded another company, Cloud Blue, in 2001 that has created 700 jobs in the U.S. and 250 jobs in New York State.  Mr. Bishop spent his entire working career in academia and government.  The government has made our K-12 education the most expensive and increasingly ineffective education in the developed world.

This clip is from a town hall meeting Mr. Bishop held on June 22, 2009 that was captured on video by Save America.  Here is a man who took an oath to support and defend the Constitution and doesn’t know what the Constitution stands for.  He thinks the central purpose of the Constitution is to provide for the common good, when it real purpose is to limit government to those few essential things necessary for a free society and leave everything else to the states and the people so they can live their lives in liberty, free to pursue their own happiness.  Perhaps what is remarkable here is that this statist member of the political class seems shocked that his constituents would question his view of the Constitution.  Almost in unison they call him on his error.  We the people are not ignorant.  We know far more that you give credit for.  We know what this country stands for and you will learn that lesson on November 2, 2010.

There is an increasingly nasty battle brewing in the Republican race for the nomination to run against Democrat incumbent Tim Bishop in the First Congressional District in New York.  With jobs and the economy the number one issue across the nation, the petty personal attacks may result in potential Republican voters staying home in disgust.

In an excellent article in the Wall Street Journal titled, “New York’s GOP Never Learns,” Kim Strassel concludes her article by saying, “The effect has been to enrage and divide a New York party that should have bigger things on its mind. Say, winning this fall.” 

Chris Cox is trying to play catch-up to the front runner Randy Altschuler who has been actively campaigning for more than a year.  The difficulty for Mr. Cox is that his positions are not that different than those of Mr. Altschuler.  So, while Mr. Altschuler has been taking on the Democratic incumbent Tim Bishop and Bishop’s lockstep voting with Nancy Pelosi, Mr. Cox has resorted to attacking Mr. Altschuler.  Not to leave his flank unprotected, Mr. Altschuler has been forced to respond and now the race, with two weeks to go before the primary on September 14^th, has degenerated into a mudslinging contest.  There is a third candidate, George Demos, who is lobbing attacks from the rear with little effect.

Each candidate is calling themselves the “true conservative,” and Mr. Cox has garnered the support of the Suffolk County 9-12 Project the self-proclaimed “Largest Tea Party organization in Suffolk County.”  Mr. Cox’s father, Ed Cox, is the head of the New York State GOP.  Ms. Strassel reports that the senior Mr. Cox, backed Steve Levy over Rick Lazio for governor to curry favor with the Suffolk County GOP chairman to back his son.  It is all the kind of backroom political dealing that have attracted a rush of newcomer candidates and put incumbents of both parties on the endangered species list.

The Tea Party Endorsement

What caught my eye was the endorsement of the Suffolk County 9-12 Project and the announcement by Bob Meyer, co-founder.  He gave as one of his primary reasons that, Randy Altschuler was one of those people, “getting rich off the backs of hardworking Americans by outsourcing their jobs.”  That sounds more like Jimmy Hoffa, Andy Stern, or Barack Obama’s class warfare than any Tea Partier I know.  A commenter on the 9-12 Project’s site, Judyann Joyner added, “Randy is credited with the creation of ‘white collar sweatshops in India.’”  Pretty strong stuff.  I don’t know if Ms. Joyner or Mr. Meyer visited the company that Mr. Altschuler co-founded in India, but Business Week magazine did.

“The lights burn day and night in the gleaming glass-and-chrome building that towers over a leafy street in the southern Indian city of Madras. Here at OfficeTiger, 1,500 young men and women peer into computers 24 hours a day, analyzing and processing U.S. Securities & Exchange Commission reports and other documents drawn up by lawyers and bankers on Wall Street. Walking the floor, sometimes even at 3 a.m., is 34-year-old co-founder and co-Chief Executive Joseph Sigelman.”

Just because the office operates 24 hours per day, don’t be conned into thinking the same people are at their desks 24 hours a day.  “Gleaming glass-and-chrome building that towers over a leafy street,” yup, sounds like a hellhole to me.  Business Week added, “Indeed, OfficeTiger is the only successful startup in India’s $5 billion outsourcing industry that is owned and managed by a U.S. entrepreneur.”  So we have an American company making money in India, in what seems to be a rather large and competitive field, and this is a bad thing?  Since when did conservatives turn into protectionists?  But what about the jobs they replaced?  Okay, let’s examine that. 

You have some Wall Street firms that are in a competitive business.  A young entrepreneur comes up with an idea to reduce operating expenses by having an external company handle routine clerical tasks that are not one of the firm’s key competencies, that is, people don’t buy that firm’s services because of their typing skills.  The company outsources and reduces costs.  By reducing costs, they prosper and grow; by growing they create more high skill jobs like lawyers, accountants, financial analysts, IT people, etc.  Perhaps even some of the former typists, because of their computer skills can move up the ladder to spreadsheets, and databases.  Do some people lose their jobs, yes, just as buggy whip makers lost their jobs when the automobile came on the scene.  Okay, let’s shift to India.

In India white collar jobs are created; their standard of living improves; they buy consumer goods like iPods and iPhones and their offices need sophisticated IT equipment from companies like Cisco Systems which grow companies like Apple and Cisco creating jobs in the U.S. We live in a global economy and if we want prosperity and peace, the best way to get there is through free markets.  Even Mr. Cox in the policy section of his website blames government policies for companies outsourcing jobs overseas.  If it is the government’s policies that make these jobs uncompetitive here and Mr. Cox knows it, why is Mr. Altschuler wrong for reacting to it and helping American companies that use these services remain competitive?

After selling Office Tiger to RR Donnelly, Mr. Altschuler started another company in the U.S., CloudBlue, that recycles old IT equipment.  So we have an entrepreneur that has started a couple of companies that have created jobs around the world and that makes him a villain?  Perhaps Mr. Meyer should go back and read some of the quotes on his own website:

“You cannot legislate the poor into freedom by legislating the wealthy out of freedom.” – Dr. Adrian Rogers

“I have a right to life, liberty, and the pursuit of happiness.” – Thomas Jefferson

Mr. Meyer’s key criticism of Mr. Altschuler smacks of the government picking winners and losers.  This business is okay, but not that one.  If your business creates jobs overseas that is bad, but if it creates jobs here it is okay.  Well, Mr. Altschuler has done both and he has firsthand experience doing so, which is what we sorely lack in Washington.  If the strategy of Mr. Cox continues, including creating another party, the TaxPayer party, to run on and split the vote further, Mr. Cox might as well mail his strategy over to the Bishop campaign as I am sure they will find it very useful in the general election.  Not my cup of tea.

The focus should be on defeating the out of control spenders in Congress who got us into this mess, not fighting each other to the death and let the incumbent waltz back into office.  The time is now.  Mr. Cox should focus on what he would do as a Congressman that is better than Tim Bishop and Mr. Altschuler.  If he can’t articulate that, he should drop out.  He is not going to win a lot of support by throwing mud at his fellow Republicans.

Note: In the spirit of full disclosure I have done some volunteer work for the Altschuler campaign

Republicans have to learn to stop fighting by the Marquis of Queensbury rules, while Democrats, bite, kick, pull hair, scratch and hit below the belt.  Yes, Christ told us to turn the other cheek, but he also overturned tables, formed a whip out of cords and drove the money changers from the temple.  In other words, sometimes you have the hit the bully hard between the eyes before he learns to stop being a bully.

So if the Republicans regain control of Congress in November, they should open the new Congress in January with detailed hearings on what happened to Fannie Mae and Freddie Mac and don’t pull any punches.  By that I mean if they need to put Andrew Cuomo in the witness chair, even if he is the governor of New York, which he probably will be, then they should do so.  It’s time to stop playing patty-cake.

For all the hoopla of the Dodd-Frank Act, Fannie Mae and Freddie Mac were left out of the new regulations.  Oh, we’ll get to those later.  Okay, let’s get to them with the Republicans in charge.  Let’s expose how it was our government that got us into the housing mess and let’s do this before the Democrats re-write history and paper over their culpability in the greatest financial crisis since the Great Depression.  It’s time to put the big lie to “it’s all Bush’s fault and Republican policies.”

The papering over has already started by none other than Franklin Raines the former head of Fannie Mae who received bonuses of over $90 million while at the helm of Fannie Mae and was also charged with cooking the books that helped him receive those bonuses.  He reached a settlement with the SEC and gave back about $1.8 million from the profits in the sale of Fannie Mae stock and gave up $5.3 million in future benefits related to his pension.  But he essentially kept the rest, what the Wall Street Journal called a “paltry settlement.” 

Mr. Raines claims the demise of Fannie Mae and Freddie Mac, to which taxpayers have already coughed up $145 billion, was due to bad credit decisions made after he left the firm.  To put it in his own words:

 “The Journal had been warning for years that the on-balance sheet portfolios of Fannie and Freddie would lead to their demise. Mr. Carney suggests that excessive leverage was the culprit. Unfortunately, neither of these were involved. Nope. Just bad credit judgments. Decisions made, by the way, while operating under close regulatory scrutiny.”

According to the Wall Street Journal “What he doesn’t say is that Fan and Fred had a political and legal mandate to support low-income housing.”  To meet this mandate which had increasing goals each year, Fannie and Freddie had to cast a wider net to find these borrowers and the wider they cast the net the lower their standards had to be.  Thus more creative types of mortgages were created to lower the bar such as, interest only loans.  This scheme would continue to work as long as housing prices kept rising but that could not go on forever.  When the music stopped a lot of people were left standing without chairs and we all lost.  People’s credit ratings were destroyed, mortgage securities were worth far less than face value, people walked away from houses, and taxpayers were forced to pick up another “too big to fail” enterprise.  By the way, where in the Constitution does it authorize the federal government to get involved in helping people buy houses?

The secret veil put in place by the main stream media has been lifted.  With the Internet and the bloggers and cable television and talk radio, the main stream media can no longer keep information that does not comport with their agenda hidden from the American people.  The American people are energized and informed but that may not last long after the election, if we don’t continue to engage them.  Uncovering the true “swamp” that is our federal government and draining it should begin by letting the sun shine in.  So let’s do away with the good ol’ boy politics of not rocking the boat when you gain control so that they won’t rock the boat when they get it back.  If we don’t have a new class of non-incumbents who are willing to go to Washington and clean it up, really clean it up, we need to get rid of them and put new people in their place.  If that means replacing Republicans with better Republicans or Democrat incumbents with better Democrats, so be it.  We have to end the process of only being able to choose between two pathetic life time politicians who have never lived in the real world.

I do not like to throw around a charge of mendacity without good reason particularly after listening to the mainstream media and liberal blogosphere accuse Bush of this all day long.  But the more I listen to what comes out of this administration and the actions they take it is getting harder to hold my fire.

Take for example the brouhaha over the immigration law that hasn’t even gone into effect yet in Arizona.  From the start the administration has falsely portrayed the law as racial profiling, but when asked if they had actually read the ten page law, both Attorney General Holder and Homeland Security Secretary Napolitano said they had not.  How do people in such senior positions in any administration make such a bold claim without reading what they are opposing?  It begs the question, do they know they are talking about?

The federal government has gone forward and is suing Arizona over the law claiming that it preempts federal law.  But here are some interesting questions:

• If the Arizona law preempts federal law and that is a bad thing, why does the federal government not sue San Francisco and other cities who have openly professed that they are Sanctuary Cities and immigration law will not be enforced therein?
• A recent news report is that there is a law on the books in Rhode Island that is virtually identical to the law in Arizona and it has withstood judicial challenge?  Why isn’t the federal government suing Rhode Island?
• The thrust of the federal government’s pique with the Arizona law is their claim that it is discriminatory.  But this same administration has just ordered that a case be dropped against a radical hate group, the Black Panthers, for putting armed thugs outside a polling place in Philadelphia on Election Day in 2008.  According to six career Civil Rights attorneys in the Justice Department, the case was a slam dunk and they had already gotten a default judgment from the court, but this administration chose to snatch defeat from the jaws of victory.  The Justice Department’s claim is that the facts did not fit the law.  Anyone who has seen the video of the incident knows that is a bald faced lie.  Is this administration for discrimination or against it?

The latest move by this administration against the rest of us is the recess appointment of Donald Berwick as the head of Medicare.  The lie in this case, is that the Republicans were stalling the appointment for “political purposes.”  Now other presidents have used recess appointments.  Both Clinton and Bush used them many times, however it was typically when they could not get the Senate to act on their nominee.  In this case, Max Baucus (D – MT), had not even scheduled hearings and eleven weeks after the nomination, the administration had not yet completed the nominating paperwork.  So was this action taken because of inaction on the part of the Senate or was the administration lying because they really didn’t want a public debate on Dr. Berwick?

Dr. Berwick has said he is, “Romantic about the National Health Service,” of Britain.  For all the false claims by the Obama Administration that if you are happy with your current health insurance you will be able to keep it, they stealthily appoint a socialized medicine disciple.  Dr. Berwick has also famously said:

 “The decision is not whether or not we will ration care – the decision is whether we will ration with our eyes open.”

Let’s see, the Obama Administration appoints Dr. Berwick head of Medicare.  Medicare is the health care program for the elderly.  Dr. Berwick is plain about health care rationing and suggests the way to do it is with our eyes open.  While the term “death panel” may have been used by Sarah Palin partially for its shock value to drive home her point, changing the name to a “rationing” panel would make it different in what way?

Here is the key distinction.  In the hands of the individual and their family, they can decide what kind of care they want to provide their loved ones.  They can decide when enough is enough or whether to press on.  In a free market, insurance policies would be true insurance not medical payment plans.  But regardless you would have the liberty to decide.  In this administration’s world, some bureaucrat makes the decision and after they have driven all the alternatives out of business, other than those available to the wealthy, you will have no choice but to succumb to the will of Big Brother.

We are currently surrounded by news of massive government failures in regulation in the areas of finance and the oil industry and we are to believe that they will be superb in running one-sixth of the economy.  Do you believe the lies?