Friday, December 30, 2011

Quality Collateral is King

From another in a series of incisive meditations upon the continuing global banking crisis from Jeffrey Snider, here:

The collateral problem is not going away no matter how authorities on either side of the Atlantic try to dress up fake guarantees. The system of wholesale lending through repo is terminally broken, since both quality reputations as well as quality collateral are in short supply. In other words, the inside participants of the global banking scheme know all too well that the system pyramided far too much paper on top of far too little actual cash flow. Liquidity is not the real problem since all the worthless collateral still stuck inside the system is likely worthless because the mathematical predictions of 2005 and 2009 proved utterly inept. Those accounting notions of equity during the credit bubbles were just as phantom as the valuations of the assets that were created from it. This coming year will be just a dance or game of musical chairs to determine who gets stuck with the bill. ...

As the progression of crisis has moved from paper asset to paper asset, from banks to countries and back to banks again, the trajectory is entirely clear. Some form of actual, exogenous restraint on credit creation will be imposed, either by someone currently in power that finally "gets it", or by a free market shaking free from the shackles of the over-enlarged financial economy and its hell-bent attempts toward unlimited money. Collateral is king in this banking world, and the rapid decay of "quality" is a testament to the intentional imbalance of finance over economy, to the hubris of modern economics and monetary "science". Unfortunately for the dreamers of true money elasticity, and too late for the rest of us, this was never supposed to happen.

Radiation 3km WSW From Fukushima the Day After Christmas 65.10 Microsieverts Per Hour

That's still over 90 times what an American can expect on average from all sources, including natural environmental, medical and transportation-related exposures. Just from normal environmental conditions the level is nearly 600 times normal for Japan at the location measured.

Standard and Poor's 500 Index Treads Water For The Last Year

So all gains were dividend related, which ended the year at 2 percent, a hell of a lot better than cash.

Thursday, December 29, 2011

Real House Prices Are Back To Q1 1999 Levels

So calculatedriskblog here"In real terms, all appreciation in the '00s is gone." 

Obama is the King of Unemployment

Initial claims for unemployment have been at or above 400,000 for 90 percent of Obama's presidency. By contrast, George W. Bush spent 25 percent of his time in office with unemployment that bad. Change . . . you asked for it.

Wednesday, December 28, 2011

Ronald Reagan Was No Conservative: He's Responsible For The Healthcare Mess

Treatment regardless of ability to pay is all his fault, along with a number of other things:

The Emergency Medical Treatment and Active Labor Act (EMTALA) is a U.S. Act of Congress passed in 1986 as part of the Consolidated Omnibus Budget Reconciliation Act (COBRA). It requires hospitals to provide care to anyone needing emergency healthcare treatment regardless of citizenship, legal status or ability to pay. There are no reimbursement provisions. Participating hospitals may only transfer or discharge patients needing emergency treatment under their own informed consent, after stabilization, or when their condition requires transfer to a hospital better equipped to administer the treatment.

EMTALA applies to "participating hospitals." The statute defines "participating hospitals" as those that accept payment from the Department of Health and Human Services, Centers for Medicare and Medicaid Services (CMS) under the Medicare program. However, in practical terms, EMTALA applies to virtually all hospitals in the U.S., with the exception of the Shriners Hospitals for Children, Indian Health Service hospitals, and Veterans Affairs hospitals. The combined payments of Medicare and Medicaid, $602 billion in 2004, or roughly 44% of all medical expenditures in the U.S., make not participating in EMTALA impractical for nearly all hospitals. EMTALA's provisions apply to all patients, and not just to Medicare patients.

Romney, Gingrich and Obama: Three Do-Gooders Shoving "Morality" Down Your Throat

Here's Romney recently: "[I]t is fundamentally a conservative principle to insist that people take personal responsibility as opposed to turning to government for giving out free care.”

Here's Gingrich in 2006: The Romney plan attempts to bring everyone into the system. The individual mandate requires those who earn enough to afford insurance to purchase coverage . . .. We agree strongly with this principle . . ..

Yankees everywhere agree: "Doin' right ain't got no end."

Big Brother Bait

drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan drill virus illegal immigrant human to animal outbreak strain recovery deaths collapse trojan

Pablo Triana Says "Value at Risk" Model Permitted Leverage Up to 1000 to 1

Pablo Triana dates the adoption of the Value at Risk model, internationally, right at the onset of American irrational exuberance after 1994:

Before VaR, which was enshrined into law by international banking regulators around 1996 and finally adopted by the SEC in 2004, the capital charges on toxic trading stuff would have been way less economical for traders, effectively making it unaffordable for banks to bet the entire farm on such dangerous punts. Without VaR, monstrous leverage on balance sheets inundated with high-stakes punts would not have been possible. Many job losses would have been avoided.

Actual capital ratios were so infinitesimal because the model allows debt to take the place of equity.

More here.

Tuesday, December 27, 2011

What I See When I Look At Mitt Romney

Tom Dewey

Newt Gingrich Has Believed in Healthcare Mandate and Subsidies Since 2006

These guys Gingrich and Romney and Obama are all about federal interference and compulsion in healthcare, a private matter between an individual and a doctor.

From Newt Notes, April 2006, here:

We agree entirely with Governor Romney and Massachusetts legislators that our goal should be 100% insurance coverage for all Americans. Individuals without coverage often do not receive quality medical attention on par with those who do have insurance. We also believe strongly that personal responsibility is vital to creating a 21st Century Intelligent Health System. Individuals who can afford to purchase health insurance and simply choose not to place an unnecessary burden on a system that is on the verge of collapse; these free-riders undermine the entire health system by placing the onus of responsibility on taxpayers.

The Romney plan attempts to bring everyone into the system. The individual mandate requires those who earn enough to afford insurance to purchase coverage, and subsidies will be made available to those individuals who cannot afford insurance on their own. We agree strongly with this principle, but the details are crucial when it comes to the structure of this plan. ...

While in theory the plan should be affordable if the whole state contributes to the cost, the reality is that Massachusetts has an exhaustive list of health coverage regulations prohibiting insurers from offering more basic, pared-down policies with higher deductibles. (This is yet another reminder that America must establish a cross-state insurance market that gives individuals the freedom to shop for insurance plans in states other than their own.)

In our estimation, Massachusetts residents earning little more than $30,000 a year are in jeopardy of being priced out of the system. In the event that this occurs, Governor Romney will be in grave danger of repeating the mistakes of his predecessor, Mike Dukakis, whose 1988 health plan was hailed as a save-all but eventually collapsed when poorly-devised payment structures created a malaise of unfulfilled promises. We propose that a more realistic approach might be to limit the mandate to those individuals earning upwards of $54,000 per year. ...

I hope that Massachusetts’ initiative to provide affordable, quality health insurance for all continues to ignite even more debate around the subject of how to best address our nation’s uninsured crisis and the critical problems within the health system at large.

The Origin of the Adage "The President Proposes, but Congress Disposes"

The origin of the adage "The president proposes but the Congress disposes" appears to be a variation on Thomas von Kempen's Imitation of Christ, Book I, ch. 19, circa 1418:

Homo proponit, sed Deus disponit.

"Man proposes, but God disposes."

Congressmen Get Richer, You Get Poorer

Just in time to echo my recent ranting about our rich, corrupt and unrepresentative Congress and why we therefore need a bigger one, Peter Whoriskey for The Washington Post here chimes in with this tidbit which shows just how unrepresentative our representatives have become:

Between 1984 and 2009, the median net worth of a member of the House more than doubled, according to the analysis of financial disclosures, from $280,000 to $725,000 in inflation-adjusted 2009 dollars, excluding home ­equity.

Over the same period, the wealth of an American family has declined slightly, with the comparable median figure sliding from $20,600 to $20,500, according to the Panel Study of Income Dynamics from the University of Michigan.

The importance of an individual member of Congress works according to the law of supply and demand: When the supply of Congressmen declines, their individual value increases dramatically. The supply of Congressmen is fixed by law, but their value now increases year by year because the number of people they represent continues to grow.

The US House acted in the 1920s to increase their own value in this way by stopping the House from growing in size proportionally with population. We never should have let them get away with it. Is it any wonder that their wealth has increased so dramatically since then? We have the finest Congress money can buy, and getting finer by the day.

It's rigged. It's a racket. And it's not working for the people anymore. It's working for itself.

We could stop this almost overnight if we simply increased the supply of representatives, just like we do with money. To make debts worth less, we print extra dollars with which to pay them off. We should do the same thing with Congressmen. To make them worth less, increase their supply. The cost of corrupting a much bigger Congress would therefore skyrocket, and the ability of the people to reign it in would improve commensurately.

Consider that in our country less than half the population is registered to vote, 146 million people in 2008. Of that, 131 million actually voted. This means the individual member of Congress on average has a voting constituency of 301,000.

But if we had the 10,267 representatives demanded by Article 1, Section 1 of the Constitution, the size of a representative's average voting constituency would plummet to . . . 12,760.

Tick-off just one mega-church, a few VFW posts, a local manufacturer or the PTA, and out he goes. Just 6,400 people could make your Congressman a loser, or a winner, and on a regular basis.

Sounds pretty representative to me, and a lot cheaper.

Why Do We March? Why Do We Protest? Why Do We Hate Congress?

Surely the answer is because we believe that our government does not represent us.

And it doesn't. In fact, the current Speaker of the House doesn't even believe that it should, and never has believed it. He went on the record early in the current legislative session saying that the president should set the Congress' agenda, as here:

“While our new majority will serve as your voice in the people’s House, we must remember it is the president who sets the agenda for our government.”

Rep. Boehner is seriously mistaken if he thinks the Tea Party would agree with that. It's the president's agenda which created the Tea Party, and the Tea Party doesn't like the president's agenda one bit.

Whether from the right with the Tea Party or the left with Occupy Wall Street, there is massive discontent in the American people with government.

That is why Gallup can report in December here that Congress has the lowest approval rating ever, since the polling organization began tracking the issue in 1974:

From a broad, long-term perspective, Congress has never been popular. The average annual congressional job approval rating since 1974 is 34%. Still, this year's 17% annual average is by one point the lowest yearly average Gallup has recorded.

The actual number approving of Congress has also reached a record low: 11 percent.

Instead of trying to make the Congress we have more responsive to us, why don't we just get a new one, a bigger and a better one than the one we've got?

Say, with tail fins.

Your congressman and my congressman now represent on average 707,999 people other than you or me. Which is to say, each and every voice he or she hears is next to meaningless. Once elected, your congressman treats you more like a serf than an equal because he doesn't need you to get re-elected. He needs money to do that, big money for television and other forms of advertising to get his name out there. He needs movers and shakers, not you.

If your congressman represented only 30,000 people instead of 708,000, however, do you think that he would need less money to get elected, work harder for your vote, and have an incentive to vote in Congress the way you want him to instead of the way he does? I do. And so did the authors of the constitution.

Since 1929 America has not had a Congress of the size required under Article 1, Section 1. The Congress voted to fix the size by law at the 435 level, by-passing the constitutional requirement to expand the size of the House as population grows. The consequences for the American people have been negative ever since.

This was a neat little trick designed for the benefit of only one group, the Congress. As a consequence money, influence and power have been concentrated in their few hands instead of distributed and divided broadly in order to contain it as the founders intended.

It is no wonder that Congress has become the rich, corrupt, arrogant and vile body it is today.

The best way to repair this situation, however, is not to "throw all the bums out," or work to hand control to a different political party than the one that has it now, or throw out the electoral college, or amend the constitution in some way.

No, the best way is simply to follow it. What we need to do is dilute the power the Congress presently has as the constitution requires: with a population of 308 million Americans, we should have 10,267 members in the US House, not 435.

If you want to give business as usual the boot, just hand Nancy Pelosi or John Boehner the task of trying to herd 10,000 cats for a vote on the debt ceiling, or the Patriot Act, or any other measure.

Just the thought of it should appall them.

And make no mistake about it: this sounds like a revolutionary act, but it's anything but. The real revolution occurred when Congress voted to usurp your right to the founders' vision of adequate representation.

To restore matters to the status quo ante is only counter-revolutionary.

Saturday, December 24, 2011

Two Headlines Which Say It All: Obama Wins, You Lose


No Bank Failures on the Friday Before Christmas

George Bailey, eat your heart out.

There were two failures a week and a day ago, which appear to be the last we're going to have in 2011.

#91 was Premier Community Bank of the Emerald Coast, Crestview, Florida, costing the FDIC $31.2 million.

#92 was Western National Bank, Phoenix, Arizona, costing the FDIC $37.6 million.

An unofficial list of problem banks here stands at 973 institutions with just under $398 billion in assets, not very different from last year at this time when it was 919 banks and $408 billion in assets.

Extend and pretend continues, which allows banks slowly to heal. But modern banking is rotten to the core nonetheless, just like everything else, in my humble opinion.

Friday, December 23, 2011

In Order For Third Parties To Rise, They Have To Have Representation

Third party candidacies for president fail in this country, as do those for representative or senator, because the two parties have a lock on the political process. The lock concentrates power and money in their hands, to the exclusion of the other interests which no longer have representation.

How did the two parties lock it?

Or to put it another way, how did Americans lose representation to the Republicans and Democrats?

The Republicans deliberately ignored the constitution's re-apportionment requirements after the 1920 Census, some say out of fear of competition from representatives of the massive number of then-new immigrants, and eventually prevailed in fixing representation at the arbitrary number of 435 in the US House through legislative fiat. There's absolutely nothing sacred about the number 435. It's just a number we reached when population required that number of congressmen after the 1910 Census.

Normally, the constitution's requirements have to be overcome by amendment, not legislation. But that's what we have, legislative fiat, because both parties found it in their best interests to concentrate power in themselves. The last thing they wanted to do was diffuse power to additional new players as the constitution requires. Since the constitution doesn't specify the upper limit of representation, only the minimum number and minimum proportion (Article 1, Section 1), a problem of first importance in the founding era but never resolved, they got away with it. But they shouldn't have. We're all the poorer for it.

Republicans in particular wear its stain. Today its Tea Party claims to wear the badge of constitutional originalism, but that badge is covering a huge blot of hypocrisy.

If Americans actually had the government the constitution requires but the Republicans of the '20s prevented, we'd have a US House today with 10,000 representatives, not 435.

There would most likely be a number of odd duck political parties represented in that sea of representation, like Greens, Communists, Fascists, Socialists and Constitutionalists. And probably a Gay Party from Saugaytuck, Michigan. But there might also be a rather substantial number of Conservatives and Independents. Considering that "conservative" is today's most identifiable political self-description, you can bet Republican golfers everywhere certainly don't want the competition.

But consider, for example, New York State. It has a Conservative Party, whose most famous public face is perhaps the radio host Sean Hannity. Another famous conservative from New York was the brother of William F. Buckley, Jr. US Senator Bernie Sanders of Vermont is a Socialist, from a state with next to no gun laws! Why not have more of their ilk as the people desire in the US House? Lots more.

Once there, the give and take of politics on a grander scale would most probably change the dynamics of the current politics of not-a-dime's-worth-of-difference between Republicans and Democrats. New actors would arise and give voice to ideas which in the past have had to settle for one congressman's endorsement here, or one there, only to be squelched by the Republicrat party apparatchiks.

More importantly, Republicans and Democrats would have to make alliances and share power in exchange for support. This would increase representation of ideas which today see the light of day in legislation only infrequently. And more importantly still, candidates for national office would have to forge alliances with such representatives too, which means third party candidates for president would actually begin to have some credibility with legislative support, without which a tax reformer like a Herman Cain, Ron Paul or Steve Forbes goes nowhere.

Think about it America!

Stop settling for representation without representation!

"One Representative For Every Thirty Thousand!"

Your Fascist Police State At Work: More Than 9,300 Unannounced Checkpoints Run in 2011

So says the story here.

And the LA Times here:

TSA teams are increasingly conducting searches and screenings at train stations, subways, ferry terminals and other mass transit locations around the country.

"We are not the Airport Security Administration," said Ray Dineen, the air marshal in charge of the TSA office in Charlotte. "We take that transportation part seriously." ...

In Tennessee in October, a viper team used radiation monitors and explosive-trace detectors to help state police inspect trucks at highway weigh stations throughout the state. Last month in Orlando, Fla., a team set up metal detectors at a Greyhound bus station and tested passengers' bags for explosive residue.

In the Carolinas this year, TSA teams have checked people at the gangplanks of cruise ships, the entrance to NASCAR races, and at ferry terminals taking tourists to the Outer Banks.

The instruments of fascism are slowly being introduced, and the American people accept it like sheep.

They deserve everything they're going to get.

George Orwell on the Meaninglessness of the Term 'Fascism'

"It would seem that, as used, the word 'Fascism' is almost entirely meaningless. In conversation, of course, it is used even more wildly than in print. I have heard it applied to farmers, shopkeepers, Social Credit, corporal punishment, fox-hunting, bull-fighting, the 1922 Committee, the 1941 Committee, Kipling, Gandhi, Chiang Kai-Shek, homosexuality, Priestley's broadcasts, youth hostels, astrology, women, dogs and I don't know what else."

The source of this statement attributed to Orwell is given as "Tribune, 1944" here. I haven't found a credible alternative citation proving Orwell wrote it.

In a leftist age, the promiscuous use of the term would be understandable.

Thursday, December 22, 2011

To Romney, Calling Obama a Socialist is the Same Thing as Calling Him a Momma's Boy

From an interview on FOX as transcribed here by The Washington Post:

O’Reilly: Is he a socialist?

Romney: You know, I prefer to use the term that he’s just over his head. ... I consider him a big-government liberal Democrat. I think as you look at his policies, you conclude that he thinks Europe got it right and we got it wrong. I think Europe got it wrong. I think Europe is not working in Europe. And I’ll battle him on that day in and day out. But I’m probably not going to be calling him names so much as calling him a failure.

The Economy is NOT Improving: 3rd Estimate of Real GDP Falls to 1.8 Percent from 2.0 for Q3 2011

What a joke the news is today. GDP is revised down and all you hear on the news is Ho! Ho! Ho!

Q2 GDP was 1.3 percent, and Q1 0.4 percent, for an average growth rate in 2011 so far of barely 1.0 percent.

One percent. From 1930 to 2000 growth averaged 3.5 percent a year. That's the normal America, and it isn't anywhere in sight and hasn't been in over a decade.

If the economy were improving truly, GDP would be much in excess of 2.5 percent, the minimum growth needed to accomodate just the natural growth of the population. The last time we had such growth ended a year ago September, spurious as it was, consisting primarily of parasitical spending by government. It wasn't even tax money the government spent. It was borrowed money. For all that, 2010 growth overall was merely 3.0 percent, in 2009 -3.5 percent, in 2008 -0.3 percent.

The personal savings rate since September 2010 has fallen 30 percent.

The ratio of the number employed to the size of the population has fallen back dramatically to levels last seen in the 1970s and early 1980s.

The growth in employment in the post-war period has stalled with the stall in GDP:

Household net worth has fallen 12 percent since 2006, 85 percent of that from the housing collapse.

Without jobs there is no growth in the savings which form the foundation of housing wealth. Without housing wealth there is no middle class which consumes the products whose aggregate value comprises 70 percent of GDP. And hence no advance in GDP.

A rich man can smoke only so many cigars, a Christopher Hitchens only so many Rothmans.

Data here and here from The Bureau of Economic Analysis.

FDR, The Enemy of Money, Devalued the Dollar Nearly 70 Percent Overnight

FDR in 1933
Executive Order 6102
Gold priced in dollars went from its historic price since 1879 of $20.67 the ounce to $35 in 1934. Gold was confiscated because the government claimed the American people were hoarding it, thwarting commerce. Kind of like today where people hoard cash but government interferes with interest rates so that you get no return and are more likely to spend it. History rhymes.

From One Perverse Little Man To Another: Pres. Carter Consoles North Korea

Here's what North Korea said about Pres. Carter giving aid and comfort to the enemy again:

"In the message Jimmy Carter extended condolences to Kim Jong Un and the Korean people over the demise of leader Kim Jong Il. He wished Kim Jong Un every success as he assumes his new responsibility of leadership, looking forward to another visit to [North Korea] in the future." 

Naval Tradition: Rum, Sodomy and the Lash

Wednesday, December 21, 2011

Harrier Jump Jet Landing Zone

Right here, fellas.

Both Santorum and Gingrich Endorsed Liberal Republicans. Expect the Same as President.

endorsed Spectre

endorsed Scozzafava

Flashback to Dec. 24, 2009: Democrat US Senate Rams Through Healthcare in Rare Vote

Reid The Arrogant
From The New York Times (link):

The 60-to-39 party-line vote, starting at 7:05 a.m. on the 25th straight day of debate on the legislation, brings Democrats closer to a goal they have pursued for decades and brings President Obama a step closer to success in his signature domestic initiative. When the roll was called, with Vice President Joseph R. Biden Jr. presiding, it was the first time the Senate had gathered for a vote on Christmas Eve since 1895.

Fast forward to today.

The US Senate is still controlled by Democrats, but it adjourned for the year on Saturday, Dec. 17, even though the Social Security Tax Cut measure it passed is different from the US House's bill and requires reconciliation before the tax cut can be take effect on January 1, 2012.

House Republicans have remained in Washington, willing to work on the measure, but Democrats have fled town.

Chevy Volt and East German Trabant, Compared

Their Commie Junk

This one had a heater in the back to keep you warm while you pushed it.

Our Commie Junk

To keep your hands warm in this one, the battery catches fire.

Militarized US Police Units Have Grown in Number by at Least 60 Percent Since 2000

From The Daily Beast (link):

The homeland security market for state and local agencies is projected to reach $19.2 billion by 2014, up from an estimated $15.8 billion in fiscal 2009, according to the Homeland Security Research Corp.

The rise of equipment purchases has paralleled an apparent increase in local SWAT teams, but reliable numbers are hard to come by. The National Tactical Officers Association, which provides training and develops SWAT standards, says it currently has about 1,650 team memberships, up from 1,026 in 2000.

Tuesday, December 20, 2011

These Aren't Really Man Boobs, Are They?

(video here)

Gasoline Consumption Down Every Week for Nine Months in 2011

We're having a little gas war in southeast Grand Rapids

Annual records for gasoline prices are taking their toll on the American economy, consuming as much as 0.5 percent of annual GDP.

As such, it's an example of a tax which only hurts, averaging over 5 percent of the typical household budget in the past but over 8 percent now.

The AP has the story here:

For this year, gas should average $3.53 per gallon. That's 76 cents more than last year. It's 29 cents per gallon more than 2008, when gas last set an annual record, $3.24. ... Compared with the year before, American gas consumption has been down every week for more than nine months, according to MasterCard SpendingPulse, a spending survey.

Or Else Tyranny Wins

From Aaron MacLean here:

If one wanted to be unkind to Hitchens, a claim could be made that, as a natural belligerent and contrarian, he was in the end drawn naturally to soldiers, whose aggressiveness and courage he admired. Less generous formulations of this argument can be encountered among his critics, but all versions of it are essentially false. It wasn’t so much the fighting which was the point, as the fact that there was so much for a free man​—​if he wanted to deserve the name​—​to fight against. If -others were unwilling to challenge the slavemasters of the world; well, then, as with Orwell before him, the willing slaves could come in for some rough treatment, too. 

I remember that at our first meeting, a lunch in Dupont Circle shared while I was still a student, an old man came over to our table and hoarsely exclaimed the motto of the Greek Cypriot struggle: “eleftheria i thanatos”​—​freedom or death. (It isn’t every day .  .  . ) In the end, Hitchens went to war with death itself. Not just by means of his treatment​—​a delaying action which was destined to fail in the end​—​but, characteristically, by going to war in print with the sentimentality and dishonest fluff that attaches to the fact of death. Practicing his craft in a condition in which most of us would be content merely to continue breathing, he went on shattering icons and offending pieties even from his hospital room: a free man, telling the truth about one final tyrant.

Religion exists because some men are unwilling to bow even in death.

Monday, December 19, 2011

Props to Erick Erickson: Republicans Are Insane

It's not a long post, but a good one:

The Republican Party has gone insane.

For the better part of the last three years the Republican Party has exercised itself into a frenzy over the need to repeal Obamacare. For the two years leading up to November of 2010, mostly middle aged working white people took to the streets in sizes rivaling a NASCAR race to protest the socialization of the American health care system.

The individual mandate and TARP draw the ire of scores of primary voters.

And our two front runners for President? They both support an individual mandate and they both supported TARP.

Not only that, just last year Mitt Romney was saying he’d keep parts of Obamacare. Like supporting amnesty, he has changed his position just in time for an election cycle.

Are we really going to do this?

I just want everyone to make sure they understand this and remind them that Perry, Bachmann, Huntsman, and yes, even Rick Santorum are still in the race.

A movement that doesn't understand what's happened to itself and can't come up with a candidate deserves everything it's going to get . . . in spades.

Black Friday Gun Sales Set Record, Up 32 Percent Over 2008

Kentucky led the pack in requests for federal background checks in November with nearly 204,000 according to this story:

In November, licensed gun dealers requested 1.53 million federal background checks for prospective gun buyers, breaking the record for the month set in 2008.

According to Federal Bureau of Investigation data, the number of such checks done on this year's Black Friday, the traditional kick-off of the holiday shopping frenzy, went from the previous high in 2008 of 97,848 to 129,166 — a whopping 32 percent increase.

Evidently some people in America still aren't convinced of this federal government's benevolent intentions.

Sunday, December 18, 2011

Kim Jong Mentally Ill Leaves Terrestrial for Celestial North Korea, Meets Christopher Hitchens!

The Associated Press announces tonight, tonight!, that Kim Jong Il has died.

What a week for Christopher Hitchens. The Iraq war ends, he dies, and now he's stuck with a dwarf playboy, forever.

Kim Jong Il supposedly died of heart failure at the age of 69 on a train.

Mish is an ignoramus: "Newspapers are surely dieing a slow death"

Maybe because no one can read, or write, the English language anymore.

Try this on for size from the end of the same blog post:

My site, ZeroHedge, Calculated Risk can all be shut down if a newspaper or other cite thinks we went beyond fair use in quoting an article.

That's a college freshman's tired mistake, or used to be.

If I wrote that the author of the above was a cereal malefactor, would you get it?

Seen here.

Saturday, December 17, 2011

Hitch: A Stalinist to the End . . .

. . . at least in the mind of George Eaton, in the New Statesman:

In his boisterous advocacy of the [Iraq] war there was more than a hint of the Marxist belief in the necessity of violence in order for history to progress. As Stalin once grimly phrased it, "You can't make an omelette without breaking eggs."

A shoddy little slam on a dead follower of Trotsky who can no longer defend himself if you ask me.

Representation Without Representation: Our Unaccountable $6 Billion Congress

According to stories here, here and here, in addition to the 535 elected members of the US Congress, there are about 10,000 staffers under various classifications who are hired by these office holders to assist them.

The average staff budget is said to be $1.5 million, which is in addition to the $174,000 annual salary of the elected representatives and senators themselves.

While the latter costs the taxpayers upwards of $93 million annually, the former is upwards of $800 million annually.

In other words, we willingly spend close to $1 billion in tax dollars every year for congressional representation which is pretty much universally despised.

And about five times as much to elect it. A CBS News/New York Times poll in October found just 9 percent of Americans approve of the job Congress is doing, but someone, somewhere, is pretty happy investing $5 billion to elect the right people. And "the right people" end up with net worths ten times that of their constituents.

Maybe it's time to change this.

How about following the constitution for a change?

Article 1, Section 1 of the constitution stipulates that representation "shall not exceed one for every 30,000." By that reasoning we should have a US House today with 10,000 representatives. Instead we have 435, thanks to the Republicans in the 1920s who simply refused to reapportion after the 1920 Census and fixed the number of representatives at the then current levels in 1929 through legislation.

The constitution wasn't amended. It was ignored. And today Republicans would claim the mantle of originalism. I'll believe it when I see it.

The great fear of the anti-federalists, who opposed the language of the constitution, was that no one man could conceivably represent adequately or honestly the interests of 30,000 citizens. They wanted the ratio to be smaller than that. Much smaller. Say on the order of one representative for every 15,000 of their fellows. That would imply today a US House of 20,000.

Instead what have we got?

Representation of one for 700,000 in a district, and climbing. Which is why you are so disgusted with your rich, arrogant and corrupt representative. He represents the guy who pays him the money he needs to advertise on radio and television so that you at least recognize his name and picture every two years and believe some stupid lie he tells about how he represents your interests even though he doesn't even know you exist. The last thing he wants is the real competition and anonymity of being just one of 20,000.

Imagine if your representative represented only 15,000 people. Chances are he would have to work pretty hard to get elected because no special interest is going to fork over millions just for his lousy vote.

He might even ring your doorbell.

What would it cost?

Even if you paid them all the same salary as we do today, half the anti-federalists' number, 10,100 representatives and senators, would cost us $1.76 billion. Their legislation might actually improve if we eliminated all their staff positions and made the elected do the actual work for a change. Throw in some campaign finance reform which stipulates contributions originate within the new districts, and repeal of the 17th Amendment, and you have a nice little package a decent presidential candidate could win on easily.

So far, however, none of them have enough imagination to see that 91 percent of the country is already ripe for the ideas.

If only they had some.

How To Preserve A Tyranny

Aristotle, Politics, 1313-1314:

[T]o preserve a tyranny . . .

keep down those who are of an aspiring disposition

take off those who will not submit

allow no public meals, no clubs, no education, nothing at all

guard against everything that gives rise to high spirits or mutual confidence

[do not permit] the learned meetings of those who are at leisure to hold conversation with each other

keep all the people strangers to each other; for knowledge increases mutual confidence;

oblige all strangers to appear in public, and to live near the city-gate, that all their actions may be sufficiently seen; for those who are kept like slaves seldom entertain any noble thoughts

endeavour to know what every one who is under their power does and says ... employ spies ... send out listeners wherever there [is] any meeting or conversation; for the people dare not speak with freedom for fear of such persons; and if any one does, there is the less chance of its being concealed;

endeavour that the whole community should mutually accuse and come to blows with each other, friend with friend, the commons with the nobles, and the rich with each other

It is also advantageous for a tyranny that all those who are under it should be oppressed with poverty, that they may not be able to compose a guard; and that, being employed in procuring their daily bread, they may have no leisure to conspire against their tyrants.

The Pyramids . . . are a proof of this . . . the edifices . . . the temple . . . all these [public works] produced one end, the keeping the people poor.

It is necessary also to multiply taxes

A tyrant also should endeavour to engage his subjects in a war, that they may have employment and continually depend upon their general. 

A king is preserved by his friends, but a tyrant is of all persons the man who can place no confidence in friends, as every one has it in his desire and these chiefly in their power to destroy him.

All these things also which are done in an extreme democracy should be done in a tyranny, as permitting great licentiousness to the women in the house, that they may reveal their husbands' secrets;

and showing great indulgence to slaves also for the same reason; for slaves and women conspire not against tyrants: but when they are treated with kindness, both of them are abettors of tyrants, and extreme democracies also; and the people too in such a state desire to be despotic.

For which reason flatterers are in repute in both these: the demagogue in the democracy, for he is the proper flatterer of the people; among tyrants, he who will servilely adapt himself to their humours; for this is the business of [1314a] flatterers.

And for this reason tyrants always love the worst of wretches, for they rejoice in being flattered, which no man of a liberal spirit will submit to; for [the best] love the virtuous, but flatter none. ...

A tyrant also should show no favour to a man of worth or a freeman; for he should think, that no one deserved to be thought these but himself; for he who supports his dignity, and is a friend to freedom, encroaches upon the superiority and the despotism of the tyrant: such men, therefore, [tyrants] naturally hate, as destructive to their government.

A tyrant also should rather admit strangers to his table and familiarity than citizens, as these are his enemies, but [strangers] have no design against him. ...

the citizens should be of poor abject dispositions; for such men never propose to conspire against any one.

[the citizens] should have no confidence in each other; for while they have not this, the tyrant is safe enough from destruction. For which reason [tyrants] are always at enmity with those of merit, as hurtful to their government; not only as [those of merit] scorn to be governed despotically, but also because [the meritorious] can rely upon each other's fidelity, and others can rely upon theirs, and because they will not inform against their associates, nor any one else.

[the citizens] shall be totally without the means of doing anything; for no one undertakes what is impossible for him to perform: so that without power a tyranny can never be destroyed.

These, then, are the three objects which the inclinations of tyrants desire to see accomplished; for all their tyrannical plans tend to promote one of these three ends, that their people may neither have mutual confidence, power, nor spirit.

On David Cameron's "Ludicrous", "Dead" Political Party

From Peter Hitchens on David Cameron's purely political play to the Eurosceptics (link):

[T]hat is all he did – avoid a referendum. He didn’t preserve Britain from an EU power-grab. That can and will still happen. Nor did he ‘repatriate’ powers from Brussels (this is a fantasy. No such thing is possible under EU law). Mr Cameron’s only action is a political one, to do with saving his ludicrous, unworkable party from a richly-deserved split and collapse. Why should anyone be grateful for that? It is precisely this artificial preservation, by increasingly desperate measures, of a dead party, that stands in the way of Britain’s long-needed departure from the EU. And there seems to me to have been a great deal of fawning over Mr Cameron by supposed 'sceptics' notably at the famous Chequers dinner on Friday night. I gather the whips called for a restrained response after Mr Cameron's statement on Monday, as by then the supposed wrath of the Liberal Democrats, which had finally awoken all those days later, had to be soothed.

David Cameron, a conservative without convictions.  

Friday, December 16, 2011

Don't Expect Overmuch: Human Nature is a Mixture of Good and Evil

"You are not however to expect, a perfect form of government, any more than to meet with perfection in man."

Pat Buchanan Describes David Cameron's Euro Veto as His Finest Hour

With his no vote on fiscal union, Cameron declared to the EU: "British surrenders of sovereignty come to an end here. And Britain will deny Brussels any oversight authority of any national budgets or any right to sanction EU members."

The euro-skeptic right is understandably ecstatic.

"He Put Britain First," thundered the Daily Mail. "There is now a wonderful opportunity for Britain gradually to loosen itself from the shackles of a statist, over-regulated, anti-democratic, corrupt EU."

The Sun featured Cameron as Winston Churchill, flashing a wartime V-for-Victory sign over the banner headline: "Up Eurs -- Bulldog PM Sticks up for Britain."

The British left, however, almost took to bed.

This, however, was NOT his finest hour just recently, when he said he supported gay marriage because he was a conservative:

"I don't support gay marriage despite being a Conservative. I support gay marriage because I'm a Conservative.”

Methinks the display of December in defiance of Europe was meant to quiet the firestorm of opposition building since October over normalised buggery at home.

Which Fascist Offends You More? Bush, or Obama?

Thursday, December 15, 2011

Federal Reserve Loans and Asset Purchases in Excess of $29 Trillion Show Banks Insolvent

From John Carney at NetNet (link):

[T]he need to keep borrowing under what are supposed to be short term facilities shows just how badly financial institutions were faring during the financial crisis.

“The amount of overnight lending reflects how broken our financial system really is. A well capitalized, moderately leveraged system does not require this massive liquidity from a central bank — interbank lending should be sufficient. What the data reveals is that the financial sector remains dangerously under-capitalized and overleveraged,” Barry Ritholz writes at the Big Picture.

Osawatomie? Whatsamatta U?

The Osawatomie Coincidence, seen here. Hm.

Liberal Lawyer Jonathan Turley Rightly Attacks Obama Administration For Support of Repackaging Blasphemy as Hate Speech

In The LA Times (link):

This week in Washington, the United States is hosting an international conference obliquely titled "Expert Meeting on Implementing the U.N. Human Rights Resolution 16/18." The impenetrable title conceals the disturbing agenda: to establish international standards for, among other things, criminalizing "intolerance, negative stereotyping and stigmatization of … religion and belief." The unstated enemy of religion in this conference is free speech, and the Obama administration is facilitating efforts by Muslim countries to "deter" some speech in the name of human rights.

Tyrants Arise From the Want of a Middle Class

"[D]emocracies are more firmly established and of longer continuance than oligarchies; but even in those when there is a want of a proper number of men of middling fortune, the poor extend their power too far, abuses arise, and the government is soon at an end."

-- Aristotle, Politics, 1296a

President's Slaves in Congress Vote to Give Him Sweeping Powers Over You

Based entirely on his discretion, the president now gets to decide as commander in chief if you, an American citizen, are a terrorist. He can then send the US military against you here on American soil, and detain you indefinitely here or abroad without trial and without a lawyer.

American citizenship, American law, and the American constitution now really do mean nothing at all, courtesy of Republicans and Democrats alike. It may have started under President Bush and The Patriot Act, but the liberal savior Barack Obama is all too happy to have the sweeping new powers, powers which he has already arrogated to himself, without opposition from his slaves, by targeting and killing American citizens working for terrorists abroad. All this is being done under justification of the law of war, even though our Congress, long ago made subservient to the Executive, has never had the courage to vote to declare war.

The American fascist police state is now complete.

Welcome to tyranny.

And have a pleasant holiday.

Stories here, here, here, here and here.

Wednesday, December 14, 2011

Bruce Bartlett is so full of it: "More than 90 percent put themselves squarely in the middle"

No they don't. Bruce Bartlett has no scruples left (link):

Social class also involves self-identification. According to the General Social Survey at the University of Chicago, which has been asking people what social class they belong to since 1972, more than 90 percent of Americans put themselves squarely in the middle – belonging either to the working class or the middle class.

This so broadly defines the middle it makes the definition meaningless.

The chief marker of membership in the middle class is homeownership, which the one third of Americans who are renters in 35 percent of the occupied dwellings in the US cannot claim, and they don't, despite what Bruce Bartlett says. They know they are working class, and they admit it.

About equal numbers have said historically that they are either working class or middle class, 45 percent each, by Bartlett's own admission.

Here's his table of the results of the latest self-identification of social class by Americans, which shows an increase in the percentage of Americans self-identifying in 2010 as working class and a more substantial decrease in the percentage of those self-identifying as middle class, just what you would expect during the collapse of the housing bubble and the decline in homeownership:

The Increase in the Wealth Gap is Due to the Housing Collapse

The latest figures from the Federal Reserve (link: compare lines 4 and 42) show that enormous wealth destruction in housing is the overwhelming cause of the dramatic decline in household net worth between 2006 and 2011.

Of the $7.8 trillion decline in net worth over that period, $6.6 trillion of that is all from the bursting of the housing bubble . . . nearly 85 percent.

Hurt most by this are the millions of middle class Americans whose primary asset is their home. Desperately trying to hold on to what they have, by scrimping, saving and working, they don't have the luxury of time to occupy much of anything to protest what is happening to them.

It is impolitic to say so, but their plight is the frequent one of the undiversified investor: too many eggs in one basket.

But that's not a bug, it's a feature of entering the middle class, whose goal is owning a home and raising a family in it, not sophisticated money management and investing. Such people who can scrape together the income of $40,000 to $50,000 necessary to support home ownership typically aren't going to have significant financial assets to manage. Of the 150 million wage earners in America, after all, fully 99 million make $40,000 a year or less.

Neither Obama nor the Republican candidates for president, nor Occupy Wall Street or the Tea Party for that matter, seem to talk much about any of this, yet the collapse of housing better explains the growing gap between rich and poor in America than do the supposed crimes of the one percent. The rich may be getting richer, but it's inspite of the fact that their own homes have declined in value, too. The middle class is being squeezed downward because its primary asset continues to lose value.

The deep frustration of so many of the American people with their elected leaders is that the leaders really don't represent them in this matter, in the same sense that sympathizing with, understanding, or trying to fix this problem doesn't have the urgency for them anymore than it does for the rich. The reason is that virtually none of them has personal experience of it. From our president to our senators and all the way on down to our representatives, we have leaders whose own high net worth and the insulation from our vulnerabilities that that affords make them remote, unfeeling, and unmotivated.

In point of fact, since it was Democrats and Republicans who conspired in the very policies which have misled Americans to drain $10 trillion in home equity over three decades (for example, dramatic changes to tax and banking policy in 1997 and 1999 under Bill Clinton, Newt Gingrich and Phil Gramm), it shouldn't be surprising that none of them really wants to talk about this gorilla in the living room. They helped make and sell the bed we're now sleeping in. And we bought it.

Of about 132 million total dwellings in 2010 of all types (table 3), just 61 million occupied dwellings are single family homes occupied by their owners, with an additional 11 million occupied by renters, according to the latest Census data here (link). That means something substantially less than 46 percent of total dwellings in the country could plausibly represent the American dream of the traditional middle class. The richest quintile, those households making over $100,000 per year, let it be remembered, lives in houses, too.

The Economic Policy Institute, whose president is a socialist, here (link) provides a useful summary of how wealthier individuals avoided the severity of the housing decline precisely because more of their assets were diversified and were not all riding on real estate (emphases added):

In 2007—prior to the Great Recession—median net worth was $106,000 (consisting primarily of home equity, as discussed later). ... Net worth for the top 1% was $19.2 million in 2007 . . ..

The updated figures for 2009 reflect the enormous destruction of wealth due to the bursting of the housing bubble. As a general rule, households with less wealth have a greater share of their wealth embedded in their homes. Thus, it is not surprising that the fallout from the deflating housing bubble disproportionally affected them. On average, the top 20% lost 16.0% and the bottom 80% lost 25.1% of their total wealth in 2008 and 2009. Average wealth of the bottom 80% was just $62,900 in 2009—a dropoff of $40,900 from 2007 and slightly less, in inflation-adjusted terms, than it was more than a quarter-century ago in 1983. Those at the top also lost ground but not nearly as much, percentage-wise. Average wealth of the top 1% was close to $14 million in 2009, down $5.2 million from 2007. ...

[H]ousing equity is a far more important form of wealth for most households. ... In 2007, the middle 20% of households held $196,700 in non-stock assets, and only $10,200 in stocks. In other words, non-stock assets—which are over-whelmingly housing equity—made up about 95% of this group’s wealth.

In the United States homeownership has long been associated with solid footing on the economic ladder, and yet the housing crash has meant that for a broad swath of people homeownership is no longer a reality.

The stepping stone from the lower and working classes to the upper classes, obviously, is the middle class. Very few skip that step, on the way up or on the way down. Rags to riches and back to rags again is interesting, but not common. Rich liberals from both parties, however, have a vested interest in minimizing the middle class to polarize the country. Rich Republicans and Democrats alike don't want the competition entrepreneurial Americans threaten them with, and leftist Democrats need a servile, manipulable constituency they can feed table scraps to in order to keep themselves in power. Some so-called conservative Republicans also, it must be said, seek their own fiefdoms of influence and power at the expense of impulses to limited government. George W. Bush's play for senior votes with Medicare Part D comes to mind.

What middle Americans should demand is a bigger House of Representatives to co-opt these entrenched interests by de-concentrating the power which the 435 now enjoy. Tea Partiers in particular should be advocating a return to the constitutional principle of one representative for every thirty-thousand of population, if their protestations to originalism mean anything. Instead of the bloated, rich and corrupt 435 politicians we've been stuck with for a hundred years, we should have 10,000 lean citizen legislators.

When we get them, things will begin to change for the better because our representatives will have far less power and far more reason to listen to the people. Special interests will have much less influence over them, campaigns will be far less costly, and Congressional staffs could be reduced dramatically, saving us money and getting some actual work out of our politicians for a change. The move would also take away the enthusiasm for radical proposals such as the elimination of the electoral college by dramatically expanding the pool of electors in presidential elections.

We might even persuade such a House to overturn the 17th Amendment, another blow for originalism, which would help improve the US Senate almost overnight. By returning the corrupting influences of campaign cash to state houses where senators would be appointed, we might actually be able to do something about corruption more often because it would be closer to home and we'd be more aware of it.