Need more soup? Just add water.

The following was posted to my Facebook page as a response to a similar piece by one of my friends. The original is re-printed below, for purposes of authorial attribution and needful context.

Juan gets up at 6 a.m. and fills his coffeepot with water to prepare his morning coffee. The water is as clean and good as it was when his ancestors pumped it up from wells they dug themsleves without the help of tree-hugging liberals. With his first swallow of water, he takes his daily medication. His medications are as safe to take as ever because some smart capitalist, in addition to financing the research which brought the medication to market, also determined that knowingly, willingly and negligently killing customers isn't a workable business plan. He also knew that where he failed, one of his competitors might succeed, putting him out of business and his employees out of work.

All but $10 of Juan's medications are paid for by his employer's medical plan because some liberal union workers fought their employers for paid medical insurance - now Juan gets it too. Aside from the fact that he didn't ask for it, he also wouldn't need it if not for the insurance in the first place. You see, Juan is the curious sort who long ago wondered why the costs of just about every other good or service on the market has a tendency to go down, except for healthcare. Reluctant to take the word of people who give him things he did not ask for and then demand gratitude, he looked into the matter himself and determined that using the insurance model to pay for health care is one of the things driving up the costs--that and his government's dictate that there are no such things as pre-existing conditions. Then, too, are all the regulations which arbitrarily add to the cost of it all.

He prepares his morning breakfast, bacon and eggs. Juan's bacon is as safe to eat as it was when his great-grandfather and grandfather were growing pigs on the family farm in South Texas during the late 19th and early 20th centuries. Of course, now, thanks to regulations and all those other good things he asked no one to do for him, his pork costs a hell of a lot more than it did a century ago (adjusting for inflation, which was also brought to him by his government). Not only that, but thanks to all these regulations, and licensing fees, and inheritance taxes, Juan's ancestors could not today afford to go into farming in the first place, leading Juan to believe that the primary purpose of these regulations is, for the most part, to limit the entry of new competitors to the no-longer-very-free market.

In the morning shower, Juan reaches for his shampoo. His bottle is properly labeled with each ingredient and its amount in the total contents because some enterprising capitalist accurately forecast that consumers would have a preference for his product over his competitors' precisely because it was labelled. Juan, of course, doesn't really care as long as it cleans his @#$%ing hair, so he has no intention of expressing gratitude to anyone for it. He paid for shampoo that cleans his hair--label or no label--and he received shampoo that cleans his hair--label or no label. He figures that if he ever really wanted to know what was in his shampoo he could have called and asked the producer to email him a list. Or he could wash his hair, and the rest of his body with lye soap, like his ancestors. Again: he didn't ask anyone for this shit in the first place. After all, even if he could easily pronounce Dodecylbenzenesulfonate, he doesn't have a degree in chemistry so he has no @#$%ing idea what the hell it is, anyway.

Juan dresses, walks outside and takes a deep breath. The air he breathes is clean not because some environmentalist wacko liberal fought for the laws to stop industries from polluting our air but because the people who own those polluting factories discovered they couldn't breathe the shit in the air any more than people who don't own factories. On his view the liberals don't want clean air; they want purified air--or just fewer factories, which they will get due the costs of building and managing new ones. (You know, like oil refineries.)

He walks on a government-provided sidewalk because it's there, whether he wants it to be or not, whether he asked for it or not. If being lectured to by liberals--in addition to paying his taxes--is the price for walking on a sidewalk he didn't ask for, then he'd rather walk in the mud, like humans did for thousands of years without having to be made to kiss meddling liberals' asses for an alternative. (He smiles at the probablility that those humans who walked in the mud for those thousands of years would consider liberals to be whinning, snivelling little pusses. The Spartans would have killed them, or exiled them: dead weight.) As he walks, he shares the sidewalk with children on their way to the elementary school, supported at the local level by his property taxes and at the federal level by his income taxes. (His own children go to a private school, for which he foots the entire bill.) He tries not be too miffed that the people responsible for taking his money in the form of taxes then turn round and lecture him on the gratitude he owes them for what they have provided him at his cost and depriving him, in the process, of those things he might have preferred to spend the money on--had he been allowed to keep it and employ it as he, the earner of the money, saw fit. "Thugs and racketeers," he mutters to himself. "I wish they'd grind this sidewalk to powder and blow it up their asses."

As he stands in the subway car, tolerating his government-subsidized ride to work, he fondles the .45 semi-auto in his overcoat and hopes two things: (1) he doesn't get caught with it since his caring and benevolent government won't let him be responsible for his own safety without its kind permission (any more than it will permit him to be responsible for his own ride to work); and (2) he never has to use it (because his benevolent government doesn't exactly own and manage the safest subway system in the world). He politely smiles at the liberal standing next to him, lecturing him on the benevolence of the government, who takes money from people who for the most part never use the damn thing in the first place. The liberal demands gratitude from Juan for an opportunity he didn't ask for--the "opportunity" to be a contributor. The liberal says, "I object to people like you enjoying the benefits I and my ilk provide and criticizing us for providing them." He tries not to laugh too hard: this liberal don't provide shit; he's a @#$%ing fast food restaurant manager who receives tax credits.

Juan begins his work day. He has a good job with excellent pay, because he doesn't belong to a union and is not bound to a collectively bargained employment agreement, which limits his pay to a figure approved by his union "brothers". Therefore, because of his superior marketable skills, as well as his skill as a negotiator, he makes better money than his unionized peers in other organizations. He has medical benefits, it's true. But this is not because liberal union members fought and died for it. (Another thing he didn't ask anyone to do for him.) It's because of U.S. domestic policy in WWII. Due to government policy, Juan learned in his private school, inflation grew both before and during WWII. As a “remedy,” caps on wage increases were imposed by the government. (Another financial set-back provided by your benevolent government.) In response, employers began to offer their employees health insurance to soften the blow and attract quality workers. ( WTF, mate? Imagine that: employers providing health care insurance, not because they were commanded by a benevolent government, but rather because of market considerations. Sometimes, it's an employees' market, not an employers' market. Again: WTF?) The federal government did not consider an increase in health benefits a violation of these wage controls, and the IRS (bless them for their infinite wisdom and generosity) ruled that health benefits were tax exempt for workers. After the wage caps were abolished, health insurance benefits became the norm and were not eliminated. Now, of course, these benefits, which started out as market driven benefits, are rights. And liberals want us to kiss their asses for (not!) procuring them for us. Thank you (relatively) free market.

It is noon-time and Juan needs to make a bank deposit so he can pay some bills. It's true that Juan's deposit is federally insured by the FDIC because some liberal wanted to protect Juan's money from bankers he determined were unscrupulous and ruined the banking system before the Great Depression. But Juan, again because he was privately educated, suspects that the liberal had no idea what unscrupulous actions the bankers took. Juan, on the other knows that the banking system wasn't ruined until after the stock market crash. Juan further knows that the stock market crash followed in predictable fashion on the heels of a great boom, a boom which was itself created by a fraudulent banking practice called "fractional reserve banking", which Juan, since he thinks its fraudulent, opposes. If banks were prohibited from practicing fractional reserve banking, he wouldn't need the @#$%ing FDIC. We wouldn't need the Federal Reserve, either, which would do away with inflation.

Unlike Joe the Republican (maybe!), Juan doesn't have a Fannie Mae-underwritten mortgage or a below-market federal student loan. Consequently he doesn't feel a duty to express gratitude to some elitist liberal who decided that Juan and the government would be better off if he was educated and earned more money over his lifetime--things which cost him (i.e., the elitist) nothing. Juan wonders two things: (1) Who the hell is the liberal to decide for him what would make him better off and then to force it upon him? and (2) Why do liberals, since they feel so strongly about it, not start their own mortagage and student loan companies and extend below-market loans to the objects of their concern? Better yet, he thinks, why don't liberals found, fund and operate their own free universities? You know: do something that actually costs them--and only them--their own @#$%ing money.

It is true that Juan attended a state funded university. But he attended it, not because it was state funded but because it was in a city he wanted to live in while he went to college. He'd have gone to that state funded university even if it were private. (He spent six years working his way through that university for his bachelor's degree; he'd have had no problem spending eight years working his way through a private one). Moreover, he'd have had no problem taking out a market-priced student loan, spending fewer years working his way throught school and paying the loan off from money earned from his improved employment conditions. Juan happens to believe that without state funding inflating both the costs of a university education, as well as the grades awarded by universities, there could be more private universities. This increase in the number of universities, all competing for students, would drive down the cost of a university education. (It's a supply and demand kind of a thing. A liberal wouldn't understand.) Finally, as a believer in privately funded university education, as well as personal generosity, Juan is a member of his alma mater's alumni association and gives as generously as he is able to financially support his university.

Juan is home from work. He plans to visit his father this evening at his farm home in the country. He gets in his car for the drive. His car is among the safest in the world. It's also a bit more expensive than it needs to be because it has features required by law he might not have wanted in the first place had he been asked. This, again, is because some meddling liberal fought for unreasonable car safety standards. As he drives out to his father's he remembers his great-grandfather's car that didn't even have seat belts because in those days, seat belts were optional; and his great-grandfather didn't think he needed them. Juan admits that he himself would have purchased them, but wonders what it would be like to live in a country where an adult is free to make such decisions for himself. What a country that would be.

He arrives at his boyhood home. His was the fourth generation to live in the house financed by three previous generations of capital accumulation--no inheritance taxes. The house didn't have electricity until Juan's dad was almost out of high school. It's true that some big-government liberal stuck his nose where it didn't belong and demanded rural electrification, which, naturally, cost the liberal nothing. The electric company ran the wires out there, but lost a lot of money because there were few customers: Juan's family and their neighbors didn't have shit that ran on electricity in the first @#$%ing place, and had no immediate plans to buy such things. But you can't expect your average, city-dwelling, big-government liberal to know shit about country living.

Juan is happy to see his father, who is now retired. His father, who lives on a farm, remember, lives on the money his still-productive farm generates for the family. Yep. His dad and mom handled their money well, making sure, as well as they could, that they could take care of themselves so Juan wouldn't have to. Not that Juan would mind: he loves his parents. (He knows there are liberals who think he shouldn't have to take care of his parents, but he doesn't care what they think. These are not their parents!) And it's a good thing his parents were smart with their money, too: Social Security don't pay squat. Who the @#$% can live off it? Certainly not Juan's parents.

Juan gets back in his car for the ride home, and turns on a radio talk show. The liberal radio host keeps saying that liberals are good and conservatives are bad. (Libertarians are probably worse than bad.) He doesn't mention that the benevolence bestowed by liberals like himself cost them nothing or, at most, a pittance. He doesn't understand why conservatives aren't grateful.

Juan muses aloud: "First they take our money, then return a fraction of it in the form of things we didn't ask them for. Then they demand our gratitude and call us hypocrites for living the life they have forced upon us. What the hell are we supposed to do? Rip out the seat belts? They have made it illegal not to use them. For this, we are to be grateful? Cabrones."

P. S. -- Joe Republican, who in Juan's opinion is almost as much a statist as any liberal, can speak for himself.

*********************************************************************

"The Life of Joe Republican"
by Hector Cruz

[Or; "How a Liberal Does Ad Hominem, Specious and Tendentious all in Seven Hundred Words or Less"]



Joe gets up at 6 a.m. and fills his coffeepot with water to prepare his morning coffee. The water is clean and good because some tree-hugging liberal fought for minimum water-quality standards. With his first swallow of water, he takes his daily medication. His medications are safe to take because some stupid commie liberal fought to ensure their safety and that they work as advertised.All but $10 of his medications are paid for by his employer's medical plan because some liberal union workers fought their employers for paid medical insurance - now Joe gets it too.

He prepares his morning breakfast, bacon and eggs. Joe's bacon is safe to eat because some girly-man liberal fought for laws to regulate the meat packing industry.

In the morning shower, Joe reaches for his shampoo. His bottle is properly labeled with each ingredient and its amount in the total contents because some crybaby liberal fought for his right to know what he was putting on his body and how much it contained.

Joe dresses, walks outside and takes a deep breath. The air he breathes is clean because some environmentalist wacko liberal fought for the laws to stop industries from polluting our air.

He walks on the government-provided sidewalk to subway station for his government-subsidized ride to work. It saves him considerable money in parking and transportation fees because some fancy-pants liberal fought for affordable public transportation, which gives everyone the opportunity to be a contributor.

Joe begins his work day. He has a good job with excellent pay, medical benefits, retirement, paid holidays and vacation because some lazy liberal union members fought and died for these working standards. Joe's employer pays these standards because Joe's employer doesn't want his employees to call the union.If Joe is hurt on the job or becomes unemployed, he'll get a worker compensation or unemployment check because some stupid liberal didn't think he should lose his home because of his temporary misfortune.

It is noontime and Joe needs to make a bank deposit so he can pay some bills. Joe's deposit is federally insured by the FSLIC because some godless liberal wanted to protect Joe's money from unscrupulous bankers who ruined the banking system before the Great Depression.

Joe has to pay his Fannie Mae-underwritten mortgage and his below-market federal student loan because some elitist liberal decided that Joe and the government would be better off if he was educated and earned more money over his lifetime. Joe also forgets that his in addition to his federally subsidized student loans, he attended a state funded university.

Joe is home from work. He plans to visit his father this evening at his farm home in the country. He gets in his car for the drive. His car is among the safest in the world because some America-hating liberal fought for car safety standards to go along with the tax-payer funded roads.

He arrives at his boyhood home. His was the third generation to live in the house financed by Farmers' Home Administration because bankers didn't want to make rural loans.The house didn't have electricity until some big-government liberal stuck his nose where it didn't belong and demanded rural electrification.

He is happy to see his father, who is now retired. His father lives on Social Security and a union pension because some wine-drinking, cheese-eating liberal made sure he could take care of himself so Joe wouldn't have to.

Joe gets back in his car for the ride home, and turns on a radio talk show. The radio host keeps saying that liberals are bad and conservatives are good. He doesn't mention that the beloved Republicans have fought against every protection and benefit Joe enjoys throughout his day. Joe agrees: "We don't need those big-government liberals ruining our lives! After all, I'm a self-made man who believes everyone should take care of themselves, just like I have."

If a judge blocks a moratorium on off-shore drilling it presents a set of simple legal questions:

(1) Does the President of the United States have the Constitutional authority to stop off-shore drilling? (And, if so, in which article or amendment are we to look for this authority?)
(2) If the POTUS does have this authority, then under what circumstances is he legally authorized to do so?
(3) Do the circumstances under which the present moratorium was placed meet the Constitutional criteria?

Judge Martin Feldman has blocked the moratorium, asserting that it fails legal muster. Thus far the media are more concerned with Judge Feldman's oil holdings rather than the legal questions presented. In this article, Michael Kunzelman is pleased to inform us that "Feldman's financial disclosure report for 2008...shows holdings in at least eight petroleum companies or funds that invest in them, including Transocean, which owned the Deepwater Horizon drilling rig...." Kunzelman is kind enought to go on to report that it is not clear "whether Feldman still has any of the energy industry stocks."

I'm sure Kunzelman thinks he's a brilliant guy, but the fact is his sub silentio argument is that Feldman's argument is one he holds only because he probably owns oil stock. But this sort of reasoning, if it can be called reasoning, is logically fallacious. Specifically, it is called a Bulverism. It's the "You assert P because you are a Q" sort of argument, meaning, tacitly, of course, that P is false. Kunzelman writes nothing -- and I mean nothing -- about any legal argument the judge may have had. Pathetic.

Note: Judge Feldman's ruling simply "prohibits federal officials from enforcing the moratorium until a trial is held." A trial? What a travesty of justice! Oh! But wait! What's this?

No person shall be...deprived of life, liberty, or property, without due process of law....

I think that's in the Constitution somewhere. I could be wrong. But I'm not.

This moratorium constitutes the deprivation of the liberty of oil companies to engage in their business. Due process of law? A trial? With a jury sitting as finder of fact? Good heavens! What next? Rule of law?

Share on Facebook

Deserta faciunt et pacem appellant


As is well known, last week the Securities and Exchange Commission charged Goldman Sachs with fraud. Since then both Republicans and Democrats have been using the case to promote their respective. For Democrats, Goldman Sachs demonstrates the need for more financial regulation. For Republicans the case raises questions about the involvement of some members of His Beatitude's Administration. Some wonder if His Grace will return nearly one million in Goldman Sachs campaign contributions.

disguised as a speech on economic history.

Did the President of the United States knowingly utter a falsehood when he said that his healthcare plans would not cover those in the country illegally? Joe Wilson thought so, and said so. (If it was not so, then...uh...why did the loophole have to be removed? And why is Luis Gutierrez, of the Congressional Hispanic Caucus, only now angry with the president? He wasn't angry before the president's disavowal. Why is he now?)

It could be that His Beatitude was simply mistaken. That is always a possibility. It's also a possibility that Bush was mistaken about the presence of WMD in Iraq. But when no such weapons were found, we did not hear a hue and cry over the fact that Bush was mistaken (which would have been bad enough); we heard he lied. No wonder, then, that if the current president makes a statement of fact which is false, someone might just get the idea that he knowingly did so.

Former president, James Carter, must think such fine distinctions are a waste of his dwindling time. He knows something more important. He knows that the truth of the matter is not that Joe Wilson, and others, thought the president made a statement of fact which was untrue -- and did so knowingly -- but that inherent opposition to a black president is the real issue.

Poppycock! It could very well be true that every single opponent to the president's silly insurance scheme is a card-carrying member of the KKK. It could also -- at the same time, I mean -- be true that the President of the United States, in an address to Congress, knowingly made a statement of fact which was not true. Someone's race issues -- or putative race issues -- have no bearing on whether someone has lied, or whether adding yet another insurer to the insurer pool counts as healthcare system reform.

If saying, "You lie!" to a man one thinks is lying to you makes one a racist, then how are we ever to call liars on the carpet?

In other news, the New York Times informs us that it isn't all bad, that very little hiring is being done. Only during a Democratic regime.

A man said to the universe,
"Sir, I exist."
"However," replied the universe,
"The fact has not created in me
"A sense of obligation." -- Stephen Crane

A perennial complaint during the Republican Captivity II was that myriads of college graduates were having to take low-paying, even minimum wage jobs. College graduates were "flipping burgers". Oh, the Charles Dickens of it all. That was bad news, because college graduates should just walk right into mid-management jobs. And that's in a bad economy; in a good economy, those graduates should have a seat on the board, no doubt. College graduates flipping burgers and waiting tables was also one of many signs that Republicans don't know how to manage an economy. (Note: an un-managed economy is a good thing to some of us.)

We deserve more, and some power, somewhere, is obligated to make sure we get it.

But now, believe it or not, that low-paying job could actually -- get this -- be a good thing. Paul Facella (ironically, a former burger-flipper), lists six good things, (six career enhancers, even) about starting out on the bottom rung.

That reminds me: remember when the best G.D.P. was a J-O-B?

Apparently, that applies only when a Republican is in the Presidential Palace. When a Democrat resides in the Palace as our Fisher-President, and the jobless hovers just below 10% or is it really closer to 20%?), why it's a great day in His Beatitude's coming paradise. These days, being J-O-B-less (and, therefore, G.D.P.-less) is, or can be, a good thing. If you just alter your perspective, these bad economic times are actually good. Think of it as "funemployment".

Incredible.

I do just happen to agree with Facella, though. Among the many benefits of starting at the bottom is the lesson in humility that some of us need, and some of us more than others. In 1992, while I was still an undergraduate, preparing -- I was certain -- law school, my wife and I suffered a financial set-back to the tune of, well, a lot of money. So long law school. I did well to get that B.A. in 1993.

I well recall the day one of my friends called, just a few days before graduation, to congratulate me. We spent just a few moments half-jokingly speculating on which think tank I'd be working for inside of a decade.

My first job after graduating was in a furniture repair shop; then I tried my hand at telemarketing, followed, rather ironically, by fast-food restaurant management. That fact -- the ugly truth of the matter -- is that life is like this (no, much, much worse) for most of the world's population. And it always has been. I'm not special because I went to university; and neither are you.

Life is difficult. Most people get out of life what they can scrape out of it. Deal with it.

In the bad old days of private slavery, the overseers used whips to keep those slaves in line. Now in the good old days of public slavery the overseer uses fiat regulation to keep us in line. In the bad old days, if the overseer had wanted a slave to drive less, he'd give the slave a whippin'. Now, when they want us to drive less they give us a regulation.

There is a bit of common ground. In both cases, the overseers know it's all for the slaves' own good. After all, no one (no one in his right mind) can object to a clean energy economy, or saving the planet, or whatever they think is best for us all.

Yes, it will be good for us. Of course it will. Never mind that immigrants -- legal and otherwise -- seem not to share that conviction:

[E]conomic opportunities are universal. If you feel them and sense them, so do others outside the border — and they want to be part of it. If they don't feel them and sense them, maybe it is time to wake up and realize that they don't exist as they used to.

Time was when shelters just across the border, where people lived until they saw an opportunity for safe passage, were filled and overflowing. Now they are empty. Time was when the border-patrol vans and buses hauled people here and there, whereas now they just drive around on day trips, looking for some sign of life.

To have an "immigration problem" is enormously flattering for a country. For that problem to go away is a dark cloud, a bad omen, a sign that something is going terribly wrong. The absence of an immigration problem can quickly turn into an emigration problem.

[...]

Emigration out of the United States has been growing every year since 1991, from 252,000 in 1991 to 311,000 in 2005. I couldn't find data past that point, but can there be any doubt where we are heading with this? Low-skilled employees want nothing to do with us. High-skilled employees are not allowed in. Enterprise is being killed at every turn. It won't be long now before larger and larger numbers of people vote with their feet.

A final insult is how US tax law treats its emigrants from this country. It continues to tax them as if they were lifetime slaves. Wherever you go, the force is with you.

The heck of it is that all of this could be turned around today. A social consensus against tyranny can form and strengthen. It only takes political will to let freedom reign. ~ Lew Rockwell, here.

I wonder if that "jmwtex" guy (whom I mentioned just below) would favor abolishing the expatriation tax law on the grounds that it, like a woman being forced to carry a baby to term, is a form of slavery? I'll have to ask him.

The government and unions have got themselves some car companies, but no one has to buy those cars. But there's no guarantee it will be a profitable venture, like Amtrak. This ownership isn't going to work very well if Americans decide, in one of those great paradoxes that adds sweetness to life, that buying American, when it comes to some automobiles, may be, well, un-American.

Not to worry. A government subsidy here, a tax increase on "foreign" and imports there, a promise to make your car payment for you for nine months if you lose your job and it just might work. In other words: artificially decrease the cost (and, thus, the price) of the union-owned product, and artificially increase the cost (and, thus, the price) of the private-owned product. Why, I bet the taxes on your purchase of a GM or Chrysler product will be just about zero, but not the taxes on your foreign auto (say, for example, a Volkswagen Group product, like your Lamborghini, Bentley; or your Porsche, whatever). The taxes on those products will likely increase. But that might start a trade war.

Field stripping, that is.




A little FYI, here. Yes, you can try this at home. Make certain first that you clear the weapon. And you will know you've re-assembled it properly if the weapon racks and cycles. Pull the slide back then pull the trigger.

Now, for something completely different.

This story has it that the changing economy has many people changing jobs. Frankly, I'm shocked. I thought the thing to do when disaster strikes was to stand around in your filth waiting for the omnicompetent government to rescue you. What this? Saving yourself? (Well, not quite: a lot of unfederal dollars are at work there.)

What's next? A return to capitalism?

Oh, well. Maybe it's time for me to pursue my childhood dream. No, not the dream of being a mercenary; my wife would never stand for that. No, I mean the other dream, of being a DJ. Oh. No. A VJ.

Here's two, back-to-back, just for you. It's a two-for-Tuesday sort of thing.



You may have missed the reference in the song to Tijuana. Interesting side-note: We lived there for a few years when I was a child. I have only the vaguest of memories.

Now, from the If-I-could-be-the-central-attraction-of-any-scene-in-any-of-my-favorite-movies Category:



Wow. That was kind of fun. Thanks for tuning in.

Tomorrow's Hump Day. Maybe we'll have to do this again.

Oh, what the heck. One more. From the If-I-had-a-band-I-would-so-cover-this-song Category (and, yes, that would be me on the drums):

One of the excuses used for the recent bailouts was that the failing companies were too big to fail. The failure of these companies would have ripple effects so catastrophic as to collapse the nation's economy, perhaps even the world's economies.

The same rationale undergirds the push to give to the executive branch expanded power to seize "non-bank financial companies, such as large insurers, investment firms and hedge funds, whose collapse would damage the broader economy", instead of just banks. (The comparisons with FDR get uncannier and uncannier. If Hoover was FDR-Lite -- and he was -- then Bush will go down, if the economic history is correctly written, as Obama-Lite.)

It sounds good, to some. But the fact of the matter is this. If a company really is too big to fail, then it is too big to fail even if it is entirely solvent. For then it must be kept solvent, always. If "too big to fail" is a good enough excuse for a government take-over of companies on the verge of collapse, then it is an even better excuse -- when you think about it -- for a government take-over of too-big-to-fail-but-still-solvent companies, as well.

As soon as a company gets to be a certain size, the unfederal government will being take-over proceedings. And since the purpose of any business is simply to employ people, the unfederal department in charge of initiating these proceedings should be the Department of Labor. Poetic, when you think about it.

But I have digressed.

Soon, insolvent companies will be required to file permission with an unfederal department of something-or-other to secure permission before filing for bankruptcy. A three-member commission will determine whether the firm belongs to the 2B2F (i.e., Too Big To Fail) category. If so, take-over proceedings will begin. Bankruptcy will be averted. O, happy day!

But, really, if one of government's responsibilities is to ensure full employment then any business which employs people should be considered too big to fail. When you, personally, are unemployed, the unemployment rate is 100%. (Yes, it's a silly notion. I borrowed it from the Dickens novel Hard Times. One of the Gradgrind children says something like it.)

Well, what remains of capitalism, anyway. But I digress.

The bonuses that our benevolent fathers on the hill are so exercised about (and over which Charles Grassely, who took $26,250 from AIG in 2008, thinks these bonus receiving executives should commit suicide ) are retention bonuses.

There is more to this, of course. In typical journalistic fashion, news media report (and Congressmen spew) that these bonuses are being paid to people in the very division that destroyed the company by issuing billions of dollars in derivatives insuring risky assets. These people work in the division that destroyed the company. And, apparently, simply for working in that division -- quite apart from any consideration for the nature of the work they did -- they are actually responsible, as if they themselves made the decision to issue the derivatives. Perhaps they did, but we don't know. We don't know what these people did. We don't know what, if any, responsibility they have for the mess. They may have none at all. But they work in the division which caused the mess; and that is all we need to know.

And again: We're supposed to think these people are smarter than us. It staggers the imagination.

Nevertheless, what's completely odd is the fuss made over the $165 million spent to honor these contracts while there is relative silence about the billions in payments AIG has made to Goldman Sachs Group Inc and others. Specifically, AIG has paid $120 billion in cash, collateral and other payouts to banks, municipal governments and other derivative counterparties around the world, including at least $20 billion to European banks. Goldman Sachs received at least $13 billion. That's not only more than $165 million, it's more than half of the $173 billion in U.S. taxpayer money spent to rescue AIG. For any journalists and liberal politicians who might be reading (as if!), I'll do the math for you. While the pay-out to Goldman Sach's and the Eurobancs is 69.36% of the bailout money, the bonuses amount to a whopping .095%. Note, that .095% is not the same as 9.5%. And further note, just to make sure we're clear, that 69.36% is bigger than .095%.

I understand the payout to Goldman Sachs: Save the U.S. economy. But if the bailout was to save the U.S. economy, then why the payout to the Eurobancs? Why should taxpayer money, needed to prop up the taxpayer economy, be sent overseas? Could it be that the money was paid out because these payouts, like those executive bonuses, were contractual obligations?

Whatever the answers to those questions, it seems a bit disproportional, like one of those crazy mirrors at the carnival, to focus so much on the .095% rather than the 69.36% -- the $165 million rather than the $120 billion. I doubt we'll hear the likes of Charles Shumer or Barney Frank threatening to get the $120 billion from those foreign countries, or the $13 billion back from Goldman Sachs.

A side-bar comment addressed to the aforementioned Charles Grassely. I agree with the Confederate Yankee: If dishonor in the use of taxpayer money is grounds for committing seppuku, then you first. No one beats Congress when it comes to dishonor in use of taxpayer money. And unlike government, AIG didn't get our money from us at gun-point. And the shareholders of AIG didn't approve the bailout plan. (Does anyone remember what a shareholder is?)

Okay, not really. But sort of.

According to George Bittlingmayer & Thomas W. Hazlett, "the best forecast... is the one made by investors risking their own money. They are shorting the 'stimulus.' "

[F]rom Nov. 4, 2008 through Feb. 12, 2009, the DJI overall fell 18% -- a larger drop than during the Sept-Oct plunge. In January, when the Obama plan, promising far greater deficits than the two...plans signed by Pres. George W. Bush in 2008, was unveiled, the market tanked – the worst January performance in 113 years. (Emphasis mine.)

Yesterday, the market closed at 6,763.29. And while today it is up a little (6,772.69) as I write this, it has trended in a, shall we say, down-ward direction. (And to think, just the day after his economic "Gettysburg" address, Mary Cate Cary was writing that she thought it worked.) If investors' willingness to risk their own money is indicative of anything, then the market's continuing dive suggests the investors have precious little confidence in His Beatitude's ability to fix the economy.

Investors Business Daily puts the matter this way: Capital is on strike.

[M]any upper-income taxpayers already are planning to cut back on work and investments to stay under $250,000 in income — the point where Obama's punitive taxes kick in. No one wins from this, yet Obama seems oblivious.

This isn't the only warning sign. A new study asserts that some 100,000 highly educated, well-trained Indians now living in the U.S. will return home in the next few years. Ditto China.

Immigrant entrepreneurs are highly sensitive bellwethers of economic and social conditions. They know where the opportunities are — and where they aren't. They're voting with their feet.

Obama, as IBD points out, does seem oblivious; but he isn't oblivious. He doesn't care. I just heard on the news (WBAP-AM, Dallas, 12.00, CST) that he wants us to ignore the market, which he likened to a tracking poll in politics, as a gauge of the economy.

"But, golly gee, Wally," said the Beaver, "that's what they told us to look at when they told us that Bush was responsible for the market tanking in the first place. It's why they told us to vote for Obama."

A popularity tracking poll in politics? My portfolio has never increased or decreased in value in relation to any president's popularity.

In the interest of full disclosure, let us remind ourselves that, in all fairness to His Beatitude, the market has been falling steadily since Lehman Brothers went under, back in September 2008. And to be even fairer, the market didn't respond positively to any maneuvering of the Bush Administration.

What does this tell us? Perhaps it tells us that market performance and federal policy is purely co-incidental, no causal relation whatsoever. Perhaps it tells us that the market's continued fall is a response to both Bush and Obama, specifically, their Keynesianesque policies. That is, the market simply has no confidence in the federal government's ability to "fix" the economy. The housing bubble (the bursting of which brought about this mess) was, some of us think, created by the Fed. Maybe, for now, the market has learned its lesson: ignore the false signals sent out by the Fed, and place no faith in the unfederal government's attempts to "jump-start" the economy.

In his journals, General Patton once wrote that, while strategy need only occupy what he referred to as "stellar" officers (by which I understand him to mean general officers), tactics ought to be the daily preoccupation of all officers.

Ludwig von Mises had a similar view of economics:

Whether we like it or not, it is a fact that economics cannot remain an esoteric branch of knowledge accessible only to small groups of scholars and specialists. Economics deals with society's fundamental problems; it concerns everyone and belongs to all. It is the main and proper study of every citizen. - Human Action

I don't know about "main and proper"; but it certainly is important.

In a way, the Westminster Larger Catechism expresses a similar sentiment in its discussion of the 8th Commandment (beginning at Question 140):

Question 140: Which is the eighth commandment?

Answer: The eighth commandment is, Thou shalt not steal.

Question 141: What are the duties required in the eighth commandment?

Answer: The duties required in the eighth commandment are, truth, faithfulness, and justice in contracts and commerce between man and man; rendering to everyone his due; restitution of goods unlawfully detained from the right owners thereof; giving and lending freely, according to our abilities, and the necessities of others; moderation of our judgments, wills, and affections concerning worldly goods; a provident care and study to get, keep, use, and dispose these things which are necessary and convenient for the sustentation of our nature, and suitable to our condition; a lawful calling, and diligence in it; frugality; avoiding unnecessary lawsuits and suretyship, or other like engagements; and an endeavor, by all just and lawful means, to procure, preserve, and further the wealth and outward estate of others, as well as our own.

Question 142: What are the sins forbidden in the eighth commandment?

Answer: The sins forbidden in the eighth commandment, besides the neglect of the duties required, are, theft, robbery, man_stealing, and receiving anything that is stolen; fraudulent dealing, false weights and measures, removing land marks, injustice and unfaithfulness in contracts between man and man, or in matters of trust; oppression, extortion, usury, bribery, vexatious lawsuits, unjust enclosures and depopulations; engrossing commodities to enhance the price; unlawful callings, and all other unjust or sinful ways of taking or withholding from our neighbor: What belongs to him, or of enriching ourselves; covetousness; inordinate prizing and affecting worldly goods; distrustful and distracting cares and studies in getting, keeping, and using them; envying at the prosperity of others; as likewise idleness, prodigality, wasteful gaming; and all other ways whereby we do unduly prejudice our own outward estate, and defrauding ourselves of the due use and comfort of that estate which God has given us.

Elements of the duties required and the sins forbidden by the commandment really do require some knowledge of economics. One is to "study to get, keep, use, and dispose these things which are necessary and convenient" for sustenance. One should also engage in a "lawful" calling, and be diligent in it. Additionally one should be frugal, avoid unnecessary lawsuits.

But it isn't a matter of being self absorbed with regard to material concerns. We must also work to procure, preserve, and even increase the wealth of others, in addition to our own. Moreover we should resist all unjust or sinful ways of taking or withholding from our neighbor what belongs to him, or of enriching ourselves at his expense. We are to avoid covetousness; "inordinate prizing" of worldly goods, as well as dishonest means of getting, keeping, and using them. This one is particularly hard for liberals and socialists: We should not envy the prosperity of others. Here's one that difficult for professional welfare recipients: not engaging in idleness, prodigality, and gambling.

From the perspective of Reformed ethics, these things are central to economics, which used to be a branch of moral science.

That -- right there -- is one of the reason I blog so much on politics and economics.

"We will rebuild...." ~ Barak Obama Epiphanes

No, I didn't watch His Beatitude's address last night. For one thing I rarely watch or listen to speeches: I don't waste an hour of my time listening to a speech that will take me only a handful of minutes to read. Last night's took me less than ten minutes. I especially have no interest in a speech for which the speaker is going to disrespect my time by showing he's in charge by making me wait for him to show up late and then going over his allotted time. Why should I give a guy that much of time when he's going to abuse it like that?

Be that as it may, having read the speech, I can say it was predictable. He complained about the massive debt "we've" inherited, and then attempted to inspire us with a speech about how he's going to continue the same type of government policies we've been living with since Roosevelt's New Deal and Johnson's Great Society.

In response to a recession, which follows on the heels of a boom created by credit expansion (which, in turn, was a response to the dot com bust), he promised -- if you can believe it -- more credit expansion. Those banks must get lending again because credit is the life-blood of capitalism. Businesses, among other things, can borrow what they need in order to make payroll.

These are people who know nothing about business. If you must borrow in order to make payroll, you're in a world of hurt. (Makes one wonder why its called "capitalism" and not "creditalism", or something like that.) But I digress.

I read it myself in black and white: credit caused this problem; and credit is the answer to the problem. Of course, he really couldn't press the credit expansion issue too far. He wants us to focus on Democrat hobby-horses as the causes of the recession: tax cuts for the rich (never any explanation of how they caused the recession which, we were initially told, was caused by predatory lending), dependence upon foreign oil, rising healthcare prices, incompetent schools, an inefficient energy grid. But not credit expansion -- except for the part where he blamed people taking on loans they couldn't pay, and people who sold such loans.

One would love to analyze the speech. But it would take a book.

I did enjoy one thing. Several times, in discussing government provision of healthcare I have asked if we might have to draft people into the medical professions should an insufficient number of people be attracted to it, for whatever reason. Last night, His Beatitude announced that dropping out of school will no longer be permitted. Your country needs you, damn it. And you're going to get an education whether you want one or not. And, apparently, these people will be forced to work, drafted into the work force, which, in a different era, was called slavery. Now, no doubt, it will be called patriotism. (Similar to Lincoln's attitude toward the Confederacy: You can't secede. Your country needs you, especially the tariffs your trade generates for us.) But, on another hand, he's effectively put an end to welfare reform, so maybe not. Hard to tell with these people.

Then there was the pretense of knowledge that these people always have, sort of. I mean, first they admit they don't really know if the stimulus plan will work, but we can't do nothing. (Oh, please, can we at least test that hypothesis?) Then, last night, we are told what the plan will do. For one thing, the plan will create or save 3.5 million jobs, which, of course, means that the people who came up with the plan know how to create jobs. (The laundry list is in the speech, which you can read, here.) One wonders why they didn't, in true capitalist fashion, take some intiative and create those jobs themselves.

Note: If Obama were Bush, the press would be spending time on nothing but the claim that America invented the automobile.

So, getting back to this posting, what should policymakers do in these sorts of situations in order to revive investment, employment and consumer demand? The answer, on a simplistic view of Keynesian economics, is fiscal stimulus by the government, in the form of tax cuts or deficit spending that will put more money in the hands of the public and thereby stimulate aggregate demand and investment.

That's what President Bush did, with his tax cuts and rebates; and – his critics said quite by accident – it turned out to be precisely the right policy, for Keynesians, anyway.

But Keynes's own formula in The General Theory was subtler, making Bush’s approach, Keynesianesque, if not Keynesian. The key to recovery, on Keynes’s view, lies in investor psychology. Investors are motivated "as a result of animal spirits—of a spontaneous urge to action rather than inaction." Investors overcome their fears "as a healthy man puts aside the expectation of death."

On such a view here is the central task for His Beatitude: He needs to reduce uncertainty and fear in the financial markets by promoting policies that are stable and predictable. When President Bush was Commander-in-Chief of the Economy (or, Chief Entrepreneur) some argued that this meant less ideological crusading about tax cutting and moral hazards overseas, less of the impulsiveness and unilateralism that had made the whole world nervous. It meant governing “sensibly” and “responsibly”, with less “partisanship” and “point-scoring”. In other words, it isn't enough just to put money in peoples' hands. They must be motivated to put that money to work, or at least to spend it. If investors are going to invest, they must have reason to believe that the future will be such as will likely yield a return on investment. The future must also be such as to allow entrepreneurs to make fairly accurate predictions about consumers future consumption. That's a tall order.

But,the future over which investors think they can plan has become shorter, as political uncertainty and instability have increased. Bush’s job as Entrepreneur-in-Chief was to employ the “right” policies to make the future grow longer again, to restore the climate for investment and growth. (Make the future grow longer; restore the climate for investment and growth -- you have to love the way these people talk; they are almost poetic. Why don't we just ask our leaders for another parting of the Red Sea, as long as they're making the future longer and restoring the investment climate?

Surely, Obama's task is the same: employ the “right” policies to make the future grow longer again, and restore the climate for investment and growth, so that investors will feel good about investing.

On a Keynesian view, apparently, the investor is phobia-ridden Adrian Monk, and the President is his psychiatrist, Doctor Kroger, whose job it is to help Monk deal with his phobias, one of which is investophobia. The President is supposed to be personally responsible for easing investors’ worries.

Short of a great big hug for investors, in the present circumstances there are two alternatives (if we are going to limit ourselves to Keynesian or Keynesianesque policies): tax cuts or deficit spending, or a combination of the two. Bush did tax cuts, with some deficit spending. Obama is going to do deficit spending with some tax cuts. The variation may be different, but the theme is the same; and the theme is Keynesian.

So, where exactly is the change?

Here’s how Cocco explains it :

We do not know if this giant stimulus plan will work -- if it is big enough and bold enough. But at least it marks an overdue abandonment of the approach we know has failed.

Well, there you have it sports fans. We do not know if this plan will work, despite its being treated as a sure thing. But she's confident we're getting change because, although we're still getting "trickle down", the recipients of the trickle have changed. And the method of trickle is different: rather than tax-cuts, the trickle is dependent upon deficit spending. Wow. That's deep. And what’s even deeper is that even though we don’t know whether it will work, we know it’s right because, if nothing else -- absolutely nothing else --it (i.e., Obama's Keynesianesque approach) “marks an overdue abandonment of the approach [i.e., Bush's Keynesianesque approach] we know has failed.” Deficit spending and a big hug for investors, instead of tax cuts and a big hug for investors.

Oh, it is change. But the change amounts to something like this: the change from the First to the Second movement of Beethoven's "Moonlight Sonata". They're still playing the "Moonlight Sonata".

Now, what if these Keynesian, or Keynesianesque, approaches are both based on a mistaken notion of the boom-bust cycle?

To be continued...

There's a bumper-sticker which has it that if you can read the sticker you should thank a teacher. (My child has, frequently. But I digress.)

Protectionist interventionist political-market economics is alive and well in the bill Rush Limbaugh has kick-named Porculus.

Earlier this month...the U.S. iron and steel industry was lobbying for a "Buy America" provision in the stimulus package. Now everybody's getting into the act.

On Tuesday [27 January] the Senate Appropriations Committee added "manufactured goods" to the list of items that must be American-made in order to qualify for stimulus dollars under the American Recovery and Reinvestment Act. Congress is signaling to the rest of the world that U.S. protectionists are in charge. Forcing U.S. contractors to buy domestic goods instead of shopping for the best price available world-wide means that taxpayers risk overpaying for their roads and bridges. And that means capital will be misallocated, fewer projects will be built and the bill will go ever-higher.

It's the easiest thing in the world to believe: the way to improve economic conditions here at home, is to encourage, inspire, motivate, cajole, require or just down-right force the purchase of domestic goods. If only it really were that easy.

There is also the little matter of retaliation by our trading partners. The European steel industry has said that it will urge the EU to challenge the provision at the World Trade Organization. That's the high road. Another course would be for other countries to lock American companies out of the bidding on their projects. China's stimulus is estimated at $600 billion. Caterpillar Tractor says that it has a "major initiative to compete in infrastructure projects around the world -- particularly in China -- and this would seriously undermine it." Congress must want more Caterpillar layoffs.

Only if Congress knew as much about economics as His Beatitudes ministers pretend to do could they know that this protectionism will, among other things, result in more Caterpillar layoffs.

On the other hand, maybe it won't. If Congress can require American-made in order to qualify for stimulus dollars under the American Recovery and Reinvestment Act, then it can also require no layoffs in order to qualify for stimulus dollars under the American Recovery and Reinvestment Act.

And, according to, David A. Patten, Newsmax, "Economists have warned that over-stimulating the economy could lead to runaway inflation, once the immediate crisis has passed." He doesn't say which economists, regrettably. But it doesn't matter: it stands to reason.

If you don't know why, thank a teacher, but only if (1) your school offered economics, (2) you signed up for the class, and (3) received a passing grade.

Well, some time this weekend, I begin the arduous process of reading His Beatitude's stimulus bill. At 334 pages it looks to be quite scintillating, right up there with The Bourne Identity the biggest thing since -- I don't know -- the Bible, The Complete Works of Shakespeare, The National Industrial Recovery Act. Want to read it, too? It's right here. Enjoy.

I just know I haven't had this much fun since I read the comprehensive immigration bill. What a knock-about of pure fun that all was!