What Obama and Granholm Have In Common: Forward To State-Capitalism

Shikha Dalmia calls what former Michigan Governor Jennifer Granholm did in front of God and everybody at the Democrat National Convention a "political pole dance", for Reason.com here:

But even more bizarre than Granholm’s convention appearance was that she was invited to make one in the first place. She was arguably the worst governor of her time who, during her eight-year term, took Michigan’s teetering economy into her firm hands and gave it a good, hard push off the cliff.

On her watch, the state's ranking in per capita GDP plummeted to 41st place from 24th. Michigan became the only state to suffer a net out-migration during the past decade, and its credit rating was repeatedly downgraded.

But since unemployment is the topic of the day, how was Granholm’s job-creation record? Worse than Katrina-struck Louisiana’s. Unemployment jumped from 6.8 percent when she was elected to 14.1 percent at its peak in 2009 – although some believe it reached as high as 15.2 percent. 

Granholm has never looked more marvelous, but pace Dalmia, Granholm's appearance wasn't bizarre.

There has been much commentary saying as much, as if Granholm's performance was like some sort of meltdown, something almost crazy and beyond the realm of understanding, not unlike Howard Dean's a few years ago.

But from the point of view of ideology her selection and presentation made perfect sense. Like the true believer of a religion, Granholm's emotional display was characteristic but superfluous. It was the content of her remarks which were significant because they were entirely in keeping with the blindness of the ideological mindset of the new old liberalism which calls failure success. Indeed, today's liberalism thrives on failure in order to succeed, and the more failure it has the more success it has. The rightness and success of the bailout of GM, the substance of Granholm's paean to Obama, isn't a bug of this new old ideology, it's a feature. Obama himself has said so. And he's now on a mission to spread the government control of business around, not just the wealth:

“I said, I believe in American workers, I believe in this American industry, and now the American auto industry has come roaring back,” he said. “Now I want to do the same thing with manufacturing jobs, not just in the auto industry, but in every industry.

Therefore consider Jennifer Granholm as the prophet of the new religion, and indeed its forerunner.

Like Michigan's devastated GDP under Granholm, America under Obama has settled into dramatically lower GDP compared to the post-war average. It has descended to almost European proportions, which evidently was the whole point of Obama's 2009 European apology tour. It was as if he were announcing that under his leadership America was going to stop being the leader of the free world and become just like them, anemic and dependent social welfare states. At 1.7 percent currently, GDP in America has indeed been cut down to size, to less than half of the decades-long average of 3.5 percent. Meanwhile nearly one in six Americans are classified as poor, and almost half of all households receive some form of direct government assistance. Is it any wonder Europe wants Obama reelected?

Like Michigan's exodus not just of population but of businesses fleeing the dreaded "single business tax" under Granholm, the nation's only value-added tax, for the first time in living memory there has been a sudden appearance of wealthy "global" Americans actually renouncing citizenship to escape the growing worldwide reach of the Internal Revenue Service's Gestapo-like intimidation of foreign financial institutions, which no longer want the trouble of doing business with Americans. Talk of finding and going to a "back-up country" among the smart set is an alarming sign that the kind of people we need to attract the most in order to grow our economy are instead repelled by the political class' increasing repression of capital and its hatred of the rich.

Like Michigan's downgraded credit rating, America under Obama lost its gold-standard AAA rating, formerly probably the single most recognizable synonym for the country's reputation in the world as the one most likely to pay its bills.

And like Michigan's long period of unemployment under Granholm, America's 43 consecutive months of unemployment at 8.1 percent or higher under Obama speak for themselves.

One might even say that Jennifer Granholm in her eerie way prepared the way for the coming of the (slum) lord. It's only fitting that she should announce his second coming. 

All of this failure is success because it keeps Democrats in power. That's why Gov. Jennifer Granholm's appearance wasn't bizarre. Her governorship epitomized the failure of America under Obama.

And so the ideologues do rejoice, because it's all intended. Forward, to state-capitalism.

ObamaCare: So-Called Conservative Heritage Foundation Built That, In 1989

Since WWII, Stocks Have Done Much Better Under Democrats Overall

Doh!

The following table is compiled from data available here.

The results are annualized rates of return, dividends fully reinvested, adjusted for inflation. In other words, these are the real annual rates of return of the Standard and Poor's 500 Index.

Dates for each presidency are marked from November 1 of the year of election to November 1 in the year losing or leaving office. Truman's service before 1948 is excluded since it overlaps the war when he took over from FDR, who died in office. Kennedy's service is combined with LBJ's because Kennedy was assassinated in his third year. Ford's service is combined with Nixon's because Ford never was elected but finished the second term of Nixon, who resigned. Obama's performance is only to July 2012, the last available data.

2008--2012 Barack Obama        12.66 percent

2000--2008 Bush The Younger  -6.12 percent

1992--2000 Bill Clinton             15.27 percent

1988--1992 Bush The Elder      10.76 percent

1980--1988 Ronald Reagan        8.98 percent

1976--1980 Jimmy Carter           2.60 percent

1968--1976 Nixon/Ford             -3.09 percent

1960--1968 Kennedy/LBJ          9.40 percent

1952--1960 Eisenhower           13.54 percent

1948--1952 Harry S. Truman   17.84 percent

Real gains per annum under Democrats have averaged 2.06 percent for their almost 28 years in control of the executive. Real gains per annum under Republicans just .67 percent for their 36 years in control. How the gains were achieved is another matter, but clearly the Democrats have done three times better than the Republicans.

If You Bet On Bush, You Lost Over 6 Percent Per Year In Stocks 11/00-11/08

(source)

Obama Investors Have Done Very Well: 12.66 Percent Real Per Year Since 11/01/08

The Obama economy sucks, but the broad market in stocks has done very well for people with the courage to have bet on him starting November 1, 2008.

Even with the market crash in March 2009, the real rate of return in the Standard and Poor's 500 Index has been 12.66 percent per annum, dividends fully reinvested.

See for yourself here.

Obama Racks Up 43rd Consecutive Month Of 8.1% Or Higher Unemployment

View the chart here.

Total Non-Farm Employment Is Still At 2005 Levels

The data may be viewed here.

Liberalism Can't Distinguish Radicalism Because They're Related

liberalism leads to death

Liberalism can't recognize radicalism because they're related. Instead liberalism tries to squirm out of the uncomfortable fact by calling it anything else. Extremism will do.

So Peggy Noonan, who appears to feel like she needs a shower after witnessing the extremism of the Democrat Convention but doesn't quite know why. 

For The Wall Street Journal, here:

Beneath the funny hats, the sweet-faced delegates, the handsome speakers and the babies waving flags there was something disquieting. All three days were marked by a kind of soft, distracted extremism. It was unshowy and unobnoxious but also unsettling. There was the relentless emphasis on Government as Community, as the thing that gives us spirit and makes us whole. But government isn't what you love if you're American, America is what you love. Government is what you have, need and hire. Its most essential duties—especially when it is bankrupt—involve defending rights and safety, not imposing views and values. We already have values. ... The huge "No!" vote on restoring the mention of God, and including the administration's own stand on Jerusalem—that wasn't liberal, it was extreme. 

Who else but a liberal could say all that and still be comfortable having a nitwit like Joe Biden a heartbeat away from the presidency?

As for Joe Biden, I love him and will hear nothing against him. He's like Democrats the way they used to be, and by that I do not mean idiotic, I mean normal . . ..

Peggy is a liberal, and knows one when she sees one. Hence her short love affair with Barack Obama, whom she threw over for Republican liberal Sen. Scott Brown of Massachusetts in early 2010. The Democrats under Obama aren't liberals any longer, except in the sense that babies grow up and become adults who only faintly resemble the parents. The hapless Baby Boom can't hold a candle to the so-called Greatest Generation, yet Peggy would speak in their defense. If only their failures didn't suggest their parents weren't so great after all. The 20th Century may have been the American century, but our troubles now suggest a deeper truth, that war is by definition demoralization writ large.  

That's the problem with liberalism. It can't properly name the enemy because to do so would indict the whole family. To liberals, Rep. Todd Akin is just as much of an extremist as the Democrat secularists, but that's all. Every family has its crazy uncle, shunned if not disowned. To people like Obama, however, Rep. Akin represents a mortal danger, an existential threat which must be eradicated, as in pulled out by the roots. He has to be disappeared by his minions because he blurts out the sordid reality which the radicals are in revolt against and ever seek to deny.

That's who Obama is, a radical, one who goes to the root of things and pulls them out by the roots. You know, like babies from their mothers' wombs. And if they happen to survive that, well, he has supported laws which would require a second doctor to come in and finish the job. But when human life begins is "above his paygrade." It sure is. We should be running this man out of the country, not running him for president.

People who get caught up in Obama's notion of transforming America forget Francis Fukuyama's timely phrase, "monstrous projects of social transformation". Death on a mass scale is its ultimate form, individual murders its particular. WWI, WWII, the Ukrainian "famine", the Gulag, Auschwitz, abortion. The vice president has seen and believed. He spoke of having learned of "the enormity" of the president's heart over the last four years. "The extreme scale of something morally wrong." You know that heart. It is the monstrous heart which orders drones to kill enemies who are on a list of his own making. American citizens have been victims of these crimes, in which he has acted as judge, jury and executioner. He shook hands with Qaddafi, and then had him killed. There was no intention of capturing Osama and making a spectacle of him, only of killing him. Who will be next?   

Liberalism has failed in explicating these things, whether it is a Democrat explanation or a Republican one. Rather it takes a conservative to understand them, someone who is trying to preserve the plant we call the constitution, not rip it out, like George Will for The Washington Post, here:

[Obama] is a conviction politician determined to complete the progressive project of emancipating government from the Founders’ constraining premises, a project Woodrow Wilson embarked on 100 Novembers ago. ... Progress, as progressives understand it, means advancing away from, up from, something. But from what? From the Constitution’s constricting anachronisms. In 1912, Wilson said, “The history of liberty is the history of the limitation of governmental power.” ... Wilson never said the future of liberty consisted of such limitation. Instead, he said, “every means . . . by which society may be perfected through the instrumentality of government” should be used so that “individual rights can be fitly adjusted and harmonized with public duties.” Rights “adjusted and harmonized” by government necessarily are defined and apportioned by it. Wilson, the first transformative progressive, called this the “New Freedom.” The old kind was the Founders’ kind — government existing to “secure” natural rights (see the Declaration) that preexist government. Wilson thought this had become an impediment to progress. The pedigree of Obama’s thought runs straight to Wilson.

You'll Notice Rep. Todd Akin Of Missouri Isn't Supported By The Fraudulent Senate "Conservatives" Fund

The Party Of No To God

God Splits Democrat Convention: Villaraigosa Fails To Call The Vote

It's pretty clear to God and everybody (oops) that the Dems assembled at their convention were split on including the hyphenation "God-given" in their platform language. The failed voice votes putting it back in should have resulted in calling the roll call on the floor. That would have been disastrous for the party, of course, to be seen actually voting on the issue, which would have communicated to the country that God is controversial in the Democrat Party. More disastrously the two thirds requirement might have failed even more demonstrably, making the Dems look even worse, forcing them to come out formally against God by adopting the existing God-less platform out of committee.

Villaraigosa, who gave the delegates two additional chances to dummy up and come out for including the language, declared the voice vote on the third try a two-thirds majority when it clearly was not, subverting the democratic process at the Democrat convention. Priceless.

But the Democrats have always been experts at subverting the democratic process, as we last saw most vividly with ObamaCare.

Too bad no one was paying attention. They might have fully appreciated the depth of their alienation from the values of America's most liberal party.

Video here.

Charles Gasparino Fingers Clinton For Housing Bubble But Misses Key Fact

Charles Gasparino fingers Pres. Bill Clinton for the housing bubble, here, pointing as many others have to the baleful influence of repealing Glass-Steagall and of expanding the Community Reinvestment Act and the role of the GSEs in housing. There is no question that these were enormously important contributing factors, except to ideologues.

What's still missing in the national discussion, however, is an appreciation of the important influence of the tax law changes in 1997 which effectively turned housing into money, the velocity of which shortly became a veritable storm rushing through the American economy when it became possible to sell every two years and pocket the capital gains tax-free. This goosed not just existing housing prices, but waves of new (over) construction, house-flipping, the home improvement mania and wide swaths of retail sector spending from giftware to landscaping to furnishings and durable goods, and especially the rapid expansion of financial products developed to exploit the trend. The housing bubble inflates just like a balloon in 1997 immediately after Clinton signed the provisions into law, passed by a Republican Congress still under the leadership of Republican Speaker Newt Gingrich.

Tax law changes have always been potent instruments for altering financial behavior. In this instance the changes in behavior were not anticipated by the many, and consumers were sold only on the incremental benefits to them. Meanwhile the few who facilitated this financialization of the economy stood ready to profit handsomely, and they did. They have been reluctant to tell this story, and understandably resist doing so to this day. But the country desperately needs to hear it if we are ever going to think clearly about establishing our affairs on a sounder basis going forward.

In Case You Missed It, Liberal Karl Rove Hates Conservatives' Guts

It doesn't matter which party they come from, they are all alike.

He has since apologized.

The eruption was reported here.

Why How Conservatives Vote In 2012 Doesn't Matter

There aren't enough of us to matter.

Obama Built That

Better Off? The Uninsured Rate Has Climbed 16 Percent Under Obama.

Data and discussion here.

Better Off? Gasoline Costs 60 Percent More Today Than In 2009.

Better Off? Full-Time Jobs Are Stuck At Summer 2004 Levels.

Data here.

The Number One Reason To Elect Romney Is That He'd Fire Ben Bernanke

"I would like to select ... a new person to that chairman position, someone who shared my economic views, someone that I thought was sympathetic to the needs of our nation," he said. ... "I don’t think QE2 was terribly effective; I think a QE3 and other Fed stimulus is not going to help this economy," he said. "I think that is the wrong way to go."

(Romney here August 23rd)

What's Wrong With This Picture?

Great Britain has 62 million people and 650 members of parliament, about one MP for every 95,000 of population.

America has 314 million people and only 435 members of Congress, about one Representative for every 721,000 of population.

The Congress Fails To Represent The People, Say 90 Percent Of Americans

Congressional approval in August is down to 10 percent, according to Gallup, here, tying the all-time low.

No wonder. How could one person effectively speak for an average constituency of over 700,000 Americans? Do you know your Congressman? Does he know you?

It wasn't meant to be this way.

The fiercest disagreements over the Constitution's ratification were over whether a Congressman would be able to speak for 30,000 Americans, or 15,000 as the anti-federalists wanted. The advocates of 30,000 won, but the line in the Constitution was inartfully written, looking backward to that debate more than forward to the consequence:

"The Number of Representatives shall not exceed one for every thirty Thousand . . .."

And so census followed census, and the Congress grew in size as the population did, decade upon decade, following the principle of one per thirty thousand.

Americans today don't realize how the Congress of the United States offended against this arrangement not until the 1920s. It was a naked power grab, fixing the number of representatives at the then current 435.

The Constitution had said nothing, they eagerly pointed out in those days, about one for more than thirty thousand, only that, say, one for 15,000 was too many. The scientific inspectors of language didn't care about the intent and the custom, only about the new opportunity. Dispensing with the census, however, which was the basis for apportioning representation, was a bridge too far.

But the example had consequences. Not long after FDR in his admiration of foreign dictators overturned another custom laid down in the founding era by the father of the country, George Washington, by running for a third term. There was nothing to prevent it. If one branch of government could grasp for more power, so could another. The imperial designs of the presidency have been with us ever since. 

The best way to fix the Congress isn't to elect a new one of a different political party. It's to dilute the power it has concentrated into its few hands by flooding the place with the roughly 10,267 representatives the constitution calls for. This should be done by constitutional amendment, after the same manner in which the 22nd explicitly enshrined Washington's example into law in 1951, restricting the president to two terms.

The Constitution isn't perfect. If it were it wouldn't be amendable. Strict constructionism is fine as far as it goes, until it runs up against the need for explicit construction.

We used to complain to the British that we had taxation without representation.

Now we have representation without representation.

It's time we changed that.

Backward, countrymen, to the future!

Romney Persuaded 53 Percent Of Republicans He Was Best Candidate For President

Romney won the primaries with 9.809 million votes. But 8.692 million voters wanted someone else.

As Governor Romney Relentlessly Scoured Tax Code To Close Loopholes

The most powerful gun in the world may be going to blow your tax deductions clean off, if elected.

The Mormon Romney is a tax enforcer, loaded with rectitude, if a long article in The New York Times, here, last October has it right:

For the next three years, the Romney administration relentlessly scoured the tax code for more loopholes, extracting hundreds of millions of corporate dollars to help close budget gaps in a state with a struggling economy. It was only after Mr. Romney was gearing up in 2005 for a possible White House bid that he backed away from some of his most assertive tax enforcement proposals amid intensifying complaints from local companies and conservative antitax groups in Washington. ...

The Democratic-controlled Legislature, which had assumed that Mr. Romney was cozy with the state’s corporate executives, was both taken aback and thrilled by the onslaught. ...

Several experts on the state’s economy said that by increasing tax enforcement, Mr. Romney staved off wider cuts to essential services.

Latest Reliable Count Puts Obama At 104 Golf Outings As Of August 4th

I'm guessing he'll be on the links this weekend, but it is campaign season.

See whitehousedossier.com here.

Election 2012: Spreading The Wealth Around v. Spreading The Taxation Around

hates your wealth

hates your tax deductions

Bernanke Claims Large Scale Asset Purchases Of $3.35 Trillion Yielded 2 Million Jobs

Among other farcical things.

Transcript here:

[I]n late 2008 the Federal Reserve initiated a series of large-scale asset purchases (LSAPs). In November, the FOMC announced a program to purchase a total of $600 billion in agency MBS and agency debt.  In March 2009, the FOMC expanded this purchase program substantially, announcing that it would purchase up to $1.25 trillion of agency MBS, up to $200 billion of agency debt, and up to $300 billion of longer-term Treasury debt.  These purchases were completed, with minor adjustments, in early 2010. In November 2010, the FOMC announced that it would further expand the Federal Reserve's security holdings by purchasing an additional $600 billion of longer-term Treasury securities over a period ending in mid-2011.

About a year ago, the FOMC introduced a variation on its earlier purchase programs, known as the maturity extension program (MEP), under which the Federal Reserve would purchase $400 billion of long-term Treasury securities and sell an equivalent amount of shorter-term Treasury securities over the period ending in June 2012. The FOMC subsequently extended the MEP through the end of this year.  By reducing the average maturity of the securities held by the public, the MEP puts additional downward pressure on longer-term interest rates and further eases overall financial conditions.

How effective are balance sheet policies? After nearly four years of experience with large-scale asset purchases, a substantial body of empirical work on their effects has emerged. Generally, this research finds that the Federal Reserve's large-scale purchases have significantly lowered long-term Treasury yields. For example, studies have found that the $1.7 trillion in purchases of Treasury and agency securities under the first LSAP program reduced the yield on 10-year Treasury securities by between 40 and 110 basis points. The $600 billion in Treasury purchases under the second LSAP program has been credited with lowering 10-year yields by an additional 15 to 45 basis points.  Three studies considering the cumulative influence of all the Federal Reserve's asset purchases, including those made under the MEP, found total effects between 80 and 120 basis points on the 10-year Treasury yield.  These effects are economically meaningful.

Importantly, the effects of LSAPs do not appear to be confined to longer-term Treasury yields. Notably, LSAPs have been found to be associated with significant declines in the yields on both corporate bonds and MBS. The first purchase program, in particular, has been linked to substantial reductions in MBS yields and retail mortgage rates. LSAPs also appear to have boosted stock prices, presumably both by lowering discount rates and by improving the economic outlook; it is probably not a coincidence that the sustained recovery in U.S. equity prices began in March 2009, shortly after the FOMC's decision to greatly expand securities purchases. This effect is potentially important because stock values affect both consumption and investment decisions.

While there is substantial evidence that the Federal Reserve's asset purchases have lowered longer-term yields and eased broader financial conditions, obtaining precise estimates of the effects of these operations on the broader economy is inherently difficult, as the counterfactual--how the economy would have performed in the absence of the Federal Reserve's actions--cannot be directly observed. If we are willing to take as a working assumption that the effects of easier financial conditions on the economy are similar to those observed historically, then econometric models can be used to estimate the effects of LSAPs on the economy. Model simulations conducted at the Federal Reserve generally find that the securities purchase programs have provided significant help for the economy. For example, a study using the Board's FRB/US model of the economy found that, as of 2012, the first two rounds of LSAPs may have raised the level of output by almost 3 percent and increased private payroll employment by more than 2 million jobs, relative to what otherwise would have occurred.  The Bank of England has used LSAPs in a manner similar to that of the Federal Reserve, so it is of interest that researchers have found the financial and macroeconomic effects of the British programs to be qualitatively similar to those in the United States.

What rot.

Eight million fewer full-time jobs exist today than in 2007. Is he saying there would be ten million fewer had the Fed not intervened?

That's only $1.675 million per job.

Wouldn't it have been more efficient simply to have dropped the cash from helicopters in our backyards?

That way all ten million of us could have enjoyed a cool $335K each. A prudent man could easily live on that for 10 years or more.

Instead we're all suckin' wind out here.

Flashback July 2010: Obama Said 2010 Midterm Election Was Referendum On His Policies

As reported here.

"[A] choice between the policies that got us into this mess and my policies that got us out of this mess."

Funny we're still in the mess his policies already got us out of two years ago.

"The Way . . . Is Surely To Think Non-Ideologically"

Timothy Snyder, here:

The way to national prosperity in the twenty-first century is surely to think non-ideologically, to recognize that politics is a choice among constraints and goods rather than a story about a single good that would triumph if only evil people would allow it to function without constraints. The market works very well for some things, the government is desperately needed for others, and stories that dismiss either one are nothing more than ideology.

What Do Today's Gasoline Prices And Chevrolet Have In Common?

"When I take her to the track she really shines

She always turns in the fastest times

My four speed dual quad posi-traction 409"

Fear Not America! Obama Will Not Succeed With Transformation, Even If He Wins!

Albert Jay Nock, American, here:

Various social superstitions, such as magic, the divine right of kings, the Calvinist teleology, and so on, have stood out against many a vigorous frontal attack, and thrived on it; and when they finally disappeared, it was not under attack. People simply stopped thinking in those terms; no one knew just when or why, and no one even was much aware that they had stopped. ...

Great and salutary social transformations, such as in the end do not cost more than they come to, are not effected by political shifts, by movements, by programs and platforms, least of all by violent revolutions, but by sound and disinterested thinking. The believers in action are numerous, their gospel is widely preached, they have many followers.

Nock's Critique Of The Tariff, 1927: A License To Rob The Domestic Consumer

Here:

The great desideratum in a tariff, for instance, is its license to rob the domestic consumer of the difference between the price of an article in a competitive and a non-competitive market. Every manufacturer would like this privilege of robbery if he could get it, and he takes steps to get it if he can, thus illustrating the powerful instinctive tendency to climb out of the exploited class, which lives by the economic means (exploited, because the cost of this privilege must finally come out of production, there being nowhere else for it to come from), and into the class which lives, wholly or partially, by the political means.

The Origin Of Our Enemy, The State

Albert Jay Nock, 1927, here:

The State originated in conquest and confiscation, as a device for maintaining the stratification of society permanently into two classes — an owning and exploiting class, relatively small, and a propertyless dependent class. Such measures of order and justice as it established were incidental and ancillary to this purpose; it was not interested in any that did not serve this purpose; and it resisted the establishment of any that were contrary to it. No State known to history originated in any other manner, or for any other purpose than to enable the continuous economic exploitation of one class by another.

Albert Jay Nock Prophesies Abortion On Demand in 1927

Here:

Everyone knows that the State claims and exercises the monopoly of crime that I spoke of a moment ago, and that it makes this monopoly as strict as it can. It forbids private murder, but itself organizes murder on a colossal scale. 

Albert Jay Nock, Detective of Fascism in 1927

As reproduced from The American Mercury, here:

"[T]he primary intention of government was not to abolish crime but merely to monopolize crime . . .."

Amity Shlaes Thinks The Mortgage Interest Deduction Is The Only One Distorting Markets

Amity Shlaes is in full-throated opposition to the mortgage interest deduction, here:

The distortion of the housing market, we now know, stemmed not only from the tax deduction but also from the subsidies of government-sponsored entities such as Fannie Mae and Freddie Mac (FMCC) and from inappropriately loose monetary policy promulgated by the Federal Reserve. ...

Opponents of deduction abolition today argue that abolition will make the market crash some more, as per Thomas of the Realtors. One could argue this the other way. Now Americans see houses for what they really are: boxes that depreciate. This is therefore the least expensive time to abolish the deduction. We have already taken the hit -- and 2012 is also the time when we most need the $100 billion or so from the elimination.

No mention here of the cost of, say, the reduced rates of taxation on capital gains and dividends, which came to $91 billion last year. Nor of the costs of any of the other tax loss expenditures which benefit everyone.

She's worried about the distorting effects of the deduction on house prices, but fails to address the distorting effects on stock prices of the lower capital gains tax rate. All tax loss expenditures have distorting effects, not just the one for housing. 

Worse to me is her objectification of the home as a depreciating box. The fact is housing was long stable in America, until Republicans in league with Bill Clinton started fiddling with it and the tax law surrounding it in 1996. What they did was turn the home into a commodity, which abnormally shot up in value and now has shot down.

The question going forward isn't whether to gut the home some more by removing the tax deduction. Even with it home values have declined dramatically today, and could go even lower despite it as they have in the past. And they probably should and probably will decline without any change to the tax deductibility of mortgage interest. If you aren't old enough to have experienced the housing crash of 1980, you aren't old enough to really understand how relatively small changes in housing values compared to now felt a lot bigger from time to time.

When you attack housing you don't just hurt people where they live in the economic sense, but you hurt them also spiritually. The home in America has been much more than a mere store of economic value, a treasury which greedy government enticed Americans to unleash in a torrent from 1997. The home is the incubator of the next generation of Americans, the place where we engage in the most important work we do as a people: replacing ourselves.

The question is what are we going to do about all the distorting effects of government tax policy, not just the distorting effects of one of them.

That Amity Shlaes leaves them all out except as they impact homeowners suggests not just an economic hostility to housing, but a cultural one, part of a broader hostility which has resulted in family dissolution, not family formation.

If the profane bottom line is tax revenue, the way to achieve it is through more taxpayers. You know the kind: the ones who get up everyday, get to work on time, and work hard.

And the most reliable way we have found to produce them is in families, families which overwhelming still prefer to live in houses.

Subsidizing this enterprise comes with a cost.

So does not subsidizing it.

Can We All Agree Now That Both Sides Intend To Cut The Growth Of Medicare Spending?

We once hoped Paul Ryan was a real spending cutter instead of a spending growth cutter, but is now just a defender of Medicare spending growth, or something.

In other words, you are either going to vote for a Republican Welfare State in Romney/Ryan sans ObamaCare, or a Democratic Welfare State in Obama/Biden with it, but not for a Fiscally Conservative State, and certainly not for a Limited State. 

The Investor's Business Daily doesn't seem to care that failing to cut the overall size of a program over time, adjusted for inflation, means you are not a fiscal conservative, here:

Media fact-checkers also complained about Ryan's charge that Obama is cutting $716 billion from Medicare to fund ObamaCare. Not true, they said. Medicare's growth is just being slowed.

But Obama achieves that slower growth by making real cuts in provider payments. And in any case, the media always and everywhere call a reduction in the rate of federal spending growth a "cut." So why suddenly charge Ryan with being misleading for using that same term?

In any case, Obama himself admitted that he's doing what Ryan says. In a November 2009 interview with ABC News, reporter Jake Tapper said to Obama that "one-third of the funding comes from cuts to Medicare," to which Obama's response was: "Right."

Reducing the size of government is different than reducing how much it grows.

Plans like the Penny Plan -- if they threw out the ever-rising baseline which makes government bigger every year because spending on programs must rise to accommodate increased population -- would work in a fiscally conservative sense because they essentially freeze programs in time and lop-off 1 percent annually until revenues grow enough to balance the budget.

But in no sense can even such a plan be construed as a limited government plan because such plans do not commit to paying off the debt, which by my calculations would take $850 billion annually or so for 30 years at 3.5 percent on top of balanced budgets each and every year over the period. This is how households used to work and no longer do, which is why government no longer does.

A country is only as good as its people. If Americans will not control their own spending, the government which represents them never will.

It begins with us, not with Barack Obama or Paul Ryan.

Election 2012: Romney v. The Utopian

Whatever Mitt Romney is, he's not a utopian.

As reported here:

After electing a man of huge promise and ambition, voters might welcome a candidate with curbed enthusiasm. That seems to be Romney’s calculation, anyway. “President Obama promised to begin to slow the rise of the oceans and heal the planet. My promise is to help you and your family,” Romney said, drawing perhaps the loudest cheers of the night.

Palin 2008 v. Ryan 2012: Not Even Close At 37.2 Million Viewers to 21.9 Million

So says Nielsen according to the Wall Street Journal, here:

An average of 21.9 million viewers tuned into the nine broadcast and cable networks that were broadcasting convention proceedings Wednesday night between 10 p.m. and 11 p.m., according to Nielsen. That was 41% less than the 37.2 million who tuned in the same night four years ago, the research firm said.

Gee, when Romney loses will they blame the conservatives again?

Rep. Ryan Falls In Line: Frames Obama's Reduced Rate Of Medicare Growth As Big Cut

William Saletan for Slate mocks Paul Ryan, here:

Since Mitt Romney tapped you as his running mate, you haven’t stood for fiscal restraint. You’ve attacked it. You warned voters in North Carolina and Virginia that cuts in the defense budget would take away their tax-supported jobs. ... Four days after Romney put you on the ticket, you began parroting his Medicare shtick. You protested that Obama’s $700 billion savings in the future growth of Medicare payments to providers—a spending reduction that any sensible conservative president would have sought, and that you had previously included in your budget plan—would “lead to fewer services for seniors.” You depicted a horror scenario: “a $3,600 cut in benefits for current seniors. Nearly one out of six hospitals and nursing homes are going to go out of business.” You assured seniors that the Romney-Ryan agenda for Medicare “does not affect your benefits.” And you promised future retirees “guaranteed affordability” of health care. In short, you adopted every tactic in the liberal playbook. You framed a reduced rate of growth as a draconian cut. You inflated the likely impact of the reduction. You denounced any loss of services as unacceptable. You promised not to touch seniors’ benefits. And you reaffirmed a fiscally unsustainable guarantee. By my count, you’ve now done this in at least six speeches and rallies. Every day, you’re reinforcing the culture of entitlement and making it harder to rein in retirement programs.

This isn't quite right. There was no fiscal restraint in the Ryan budget to begin with. It simply returned the trajectory of the growth in spending to the status quo ante Obama, which was bad enough. This is why Ryan's budget doesn't achieve balance for decades: it supports the continued growth in spending in programs like Medicare, sans ObamaCare. Obama cuts that growth to help pay for ObamaCare. In other words, it's just business as usual with the Republicans, made to look like fiscal conservatism because it wipes away the really insane spending trajectory threatened under more of Obama.

Bait the conservatives, and switch.

Yea, shame on you, Paul Ryan.

Flashback 2008: McCain Called For Spending Freeze During Crisis. In 2012 Romney Won't.

Who is the more conservative, Mitt Romney, who has said he won't cut spending dramatically in his first year for fear of causing another recession, or John McCain, who was quite radical by current standards in calling for a freeze on spending?

September 26, 2008|Russ Britt

LOS ANGELES (MarketWatch) -- Sen. John McCain proposed a possible spending freeze on virtually every federal program except the Department of Defense, for veterans and entitlement programs in a presidential debate with rival Barack Obama Friday night. Obama countered that approach is too broad-based, saying it was the equivalent of "using a hatchet where you need a scalpel."

Anybody seen the scalpel? The debt back then was $10 trillion. Now it's $15 trillion. And we're no longer AAA.

Video here.

Election 2012: Rasmussen Now Has 7 States As Toss Ups, Not 6

His map is here.

He now shows Missouri no longer leaning Romney.

Election 2012: It's The Yeomanry Vs. The Clerisy

Joel Kotkin's formulation of the class war, here, between

"people engaged in farming, fishing, forestry, transportation, manufacturing and construction"

and

"an ever-expanding class of minders — lawyers, teachers, university professors, the media and, most particularly, the relatively well paid legions of public sector workers — who inhabit Washington, academia, large non-profits and government centers across the country."

Good News For Obama: Initial Claims For Unemployment Hit Lowest Level Yet

The latest figures are reported here.

They show initial claims, not-seasonally-adjusted, revised for August 18 falling to their lowest level yet during Barack Obama's tenure: 311,787.

And the advance number for August 25 is just a hair under 310K, while August 11 came in just under 318K. At the end of July he posted a number just under 313K.

In March of this year, Obama achieved numbers as low as 319K and 315K, but the trend melted up after that. Now he has five weeks in a row between 310K and 320K.

Expect him to say this is reason for hope that the skies are finally clearing.

The Nadir For Housing Prices Since The 1950s Came In 1974

The low point for housing values since the 1950s was reached in 1974 when the Case-Shiller Home Price Index bottomed out at 111.

That bottom could easily be plumbed again, and indeed overshot to the downside in view of the massive bubble on the upside topping out at 218 in 2005, which was completely contrary to historical experience. Housing values fluctuated for a long time around the 120 level, but there is no reason why a bottom should be anchored around that number given the huge oversupply today.

What's really preventing the market from clearing is the banking system. It holds the bad paper on all this oversupply, and to clear the banking system needs to clear. Which means bankruptcy.

And as we all know, bankruptcy is failure, and failure is no longer acceptable in America. Which is why your kids will get no Fs in the upcoming academic term, and why housing will be a Zombie indefinitely.

Are We Still In The Eye Of The Housing Hurricane?

Anthony Randazzo thinks so, here:

RealtyTrac data suggests a 1.6 million home foreclosure backlog at present. Add this to the roughly 2 million foreclosures currently in progress, according to Barclay's Capital research, the 1.5 million to 4 million homes that are at least three months behind on their payments, and the 10 million mortgages that remain underwater and candidates for defaulting down the road, and you get headwinds of several different storms coming together to create a potential foreclosure hurricane headed right for the shores of today's supposedly bottoming out housing market.

Obama has done nothing important to address this problem, or the unemployment problem, during his entire tenure. 

And Romney actually INTENDS to do nothing about housing if he is elected.

So expect more of the same, with downward pressure on housing prices.

2nd Estimate of Q2 GDP Rises to 1.7 Percent from 1.5, Q1 Still at 2.0 Percent

The news release is here.

The awful number is no longer 1.5 percent, but 1.7 percent. An annualized growth of this small magnitude is about half of the historical average up until the year 2000. In the post-WW2 period GDP averaged about 3.5 percent per annum until the turn of the century.

From 2000 to now, however, GDP growth has been far less robust, with year 2004 the lone year as high as 3.5 percent. All the rest have been lower, with some negative in the little depression of 2008 and 2009.

The pdf is here.

Has it occurred to anyone we were spending too much money taking the war to the enemy, and making war on the American people in the name of security, and subsidizing too much stuff like drugs for seniors, food stamps, and healthcare? Ratcheting up these expenditures during the last decade has coincided with a streak of terrible growth numbers.

The necessity of spending cuts has never been greater, but our politicians, of both parties, seem bent on doing anything but cut spending. Which is why AAA went away.

Roman Catholics Avoid Abortion Hypocrisy Of Republicans, Slam Libertarianism Instead

Most of the commentary I'm reading from Catholic critiques of the Republicans is avoiding the manifest hypocrisy of the "life of the mother" and "cases of rape" excuses for abortion advocated by many Catholic Republicans and the Romney campaign.

Those excuses are contrary to Catholic teaching, yet there they are, so-called Catholics, so-called conservatives, hounding out of the Republican Party a man whose point was that pregnancies resulting from rape are rare, which they manifestly are, and that allowing them to come to full term and enjoy life isn't an "option" in some policy world. It's a moral imperative. In this Rep. Todd Akin, a conservative Presbyterian from Missouri, is a better Catholic than the Catholics.

Instead, the critiques are focusing on the libertarianism of Rep. Paul Ryan.

This makes excellent sense, after some reflection, for the simple reason that Catholicism sees in libertarianism a rival ideology, not unlike what Bolshevism saw in National Socialism. The point says more about Catholicism than it does about libertarianism. Catholicism fell victim to the ideological habit of mind long enough ago that Spengler in the 1930s could say:

"[A]ll Communist systems in the West are in fact derived from Christian theological thought . . . Christian theology is the grandmother of Bolshevism."

This observation makes the history of political economy necessarily a topic under the study of the history of religion. The concept of the church, which was totally foreign to Jesus, took the place of the failed imminent coming of the kingdom of God in his teaching, and immanentizes the eschaton he expected before the disciples had finished preaching in Israel. That false kingdom is now administered by popes, cardinals, bishops and priests. As such the church has been responsible for spinning off rival, "heretical", ideologies ever since. And if not the ideologies themselves, at a minimum the ideological habit of mind.

The conservative response to this is most certainly not to keep thinking ideologically. A dead Catholic named Russell Kirk also tried hard to tell us these things before he died.

Like Spengler's, his remains a voice crying in an impoverished wilderness of idealisms.

New Book By Navy SEAL Contradicts Regime's Account Of Getting Osama

Discussed here:

The author writes that bin Laden ducked back into his bedroom and the SEALs followed, only to find the terrorist crumpled on the floor in a pool of blood with a hole visible on the right side of his head and two women wailing over his body.

Bissonnette says the point man pulled the two women out of the way and shoved them into a corner and he and the other SEALs trained their guns’ laser sites on bin Laden’s still-twitching body, shooting him several times until he lay motionless. The SEALs later found two weapons stored by the doorway, untouched, the author said.

It was a kill, not a capture, operation from the get go, and the regime's story that Osama went for a gun just proves that there is still a moral majority in America which has to be mollified, as usual, with lies.

Romney Has Just Passed Party Rules To Weaken The Power Of The Grassroots

Mark Levin is all over this like a chicken on a June Bug.

Romney obviously hates the primary process because it exposes his weaknesses as a candidate conservative. By having power over the rules between conventions and the delegate selection process, if he wins election in four years he'll be burying every Tea Partier under six feet of concrete.

The time for a national conservative third party has arrived.

I won't vote for Obama. I would never do that. But I sure as hell won't vote for Romney now.

It was "Mickey Mouse" for me before, but now it's probably Virgil Goode.

Again, Sean Hannity Repeats His Hypocritical Roman Catholicism

In teh last segment, so-called conservative Sean Hannity affirmed his position on abortion as allowing abortion in the cases of rape or the life of the mother being in danger.

This amounts to self-excommunication because abortion in all instances is prohibited under Catholic dogma. For taking this position he should be denied communion as bishops have threatened against prominent Democrat politicians who support abortion. The same goes for Rep. Paul Ryan.

When is the Roman Catholic Church going to make a public statement rebuking this man who is much more public than any politician because he has microphones to the millions and is a routine and vocal proponent of Roman Catholicism?

Can You Imagine Auto Fleets Averaging 35 MPG In 2016 And 55 MPG In 2025?

Notice the dramatic uptick in fuel economy after the oil embargo of the 1970s. Economy went from about 12 mpg to about 20 in just about 5 years, an improvement of over 60 percent in a very short time.

Then economy was flat to declining for 30 years.

Since we've committed ourselves to the suburban lifestyle, it only makes sense to get the best fuel economy we can. And if anyone can do it, the Japs can.

Story here.

Bush Didn't Bow, But He Did Scrape

Why He Bows

Ulterior Motives In Writing: Why Does Mark Judge Hate Monica Crowley?

Did you ever get the feeling that an entire column was merely a pretext to slam someone the writer didn't like . . . with a sucker punch saved for the very end?

That's the overwhelming feeling I got from reading Mark Judge's "HL Mencken Against The Journalists" here, which ends with this:

"So let's just put an end to it. Call them analysts. Call them pundits. But to coo over people like Frank Rich and Monica Crowley as brilliant intellectuals is to denude the term of meaning."

After ridiculing liberal after liberal in the column the lazy writer realizes at the end he needs to be an equal opportunity critic and throws poor old Monica under the bus just to make himself look objective.

If Mark Judge hangs around people who coo over anyone, let alone journalists, he's clearly in special company already. They used to call them asylums.

You know, the sort of place which makes you write like this: "but as a man with whom we could speak with about any topic".

Thomas Sowell Tells A Truth Rep. Paul Ryan Remains Afraid To Tell You

Here:

Neither Social Security nor Medicare has ever had enough assets to cover its liabilities. Very simply, there has never been enough money put aside to do what the government promised to do.

These systems operate on what their advocates like to call a "pay as you go" basis. That is, the younger generation pays in money that is used to cover the cost of benefits for the older generation. This is the kind of financial pyramid scheme that got Charles Ponzi put in prison in the 1920s and got Bernie Madoff put in prison in our times.

Luigi Zingales Fingers George Bush As A Crony Capitalist

There's a great interview with Luigi Zingales in The Economist here:

Companies with a lot of money abroad sponsored a bill in 2004/5 that allowed them to repatriate their profits at a low tax rate. Thus $1 produced $220 of tax savings. The Bush-approved drug and Medicare act was a huge bonanza for the drug industry. Their market value increased by several billion dollars when this was announced. I could continue.

Inflation Adjusted Income Fell 4.75 Percent During "Recovery" And 7.2 Percent Overall

American incomes have fallen during the "recovery" according to this story:

Real median annual household income fell to $53,508 from $54,916 during the 18-month recession from December 2007 to June 2009, according to the firm’s [Sentier Research LLC] study of income data for the 36-month period ended in June 2012. Incomes kept falling during the 36-month period since then, dropping to $50,964 in June 2012.

The statistic is nearly meaningless if you haven't lost your career.

People with personal experience of having lost a good job and having had to take such work as they can get typically see household income drop much more than a few to several percentage points. Try experiencing a 40+ percentage point cut. That's what's happened to many of the long-term unemployed, whose huge losses get averaged out, and lost, over all households in these studies.

The Whopper Of The Day: We Lost AAA Because We Almost Defaulted Last August

The whopper of the day comes from Annie Lowrey in The New York Times, here:

Shortly after “taxmageddon,” perhaps sometime in February, the American government will exhaust its borrowing authority – meaning some unprecedented form of government default. It almost happened in the summer of 2011 and resulted in a credit downgrade. Neither party wants to go back there. Expect some agreement to lift the debt ceiling to come along with the deal to delay or otherwise soften the blow of the fiscal cliff.

No, we experienced a credit downgrade because we needed to cut $4 trillion in spending over the next ten years and could only agree on $1 trillion, and if we don't get busy cutting spending more than that there will be more credit downgrades to come.

Both Political Parties Are Greedy Liberals Eyeing Your Tax Credits And Tax Deductions

The partisan and liberal New York Times must think we can't read out here in fly-over country. "Tax reform" is now code for "tax increase".

The drumbeat to raise your taxes continues, here, an "absolute necessity":

Both parties agree on the absolute necessity of reforming the addled, inefficient American tax code. That means eliminating much of the underbrush of credits, loopholes and expenditures and then reducing marginal tax rates. Of course, the devil is in the details. Just about every tax expenditure has a powerful interest group behind it. That is part of the reason why neither party has gotten specific about what they would put on the chopping block, and both anticipate a drawn-out fight during the tax reform process.

Marginal tax rates are much easier to raise and frequently are raised, which is why the credits and deductions have to go: as long as the deductions and credits remain they suppress revenues when taxes are inevitably raised after a "reform". That's exactly what happened in 1993 after the broadly lower rates achieved in the 1986 tax reform were swept away by Bill Clinton. The deductions sacrificed in 1986 never returned.

Liberals in both parties intend to do this to the American people again.

There's nothing wrong with the current code that spending cuts couldn't fix: especially on defense and social welfare which both have dramatically increased under Bush and Obama.

Election 2012: One Was For The Healthcare Mandate Before He Was Against It, The Other Was Against It Before He Was For It. Some Choice!