“No Man’s life liberty or property is safe while the legislature is in session”.

- attributed to NY State Judge Gideon Tucker

Saturday, November 14, 2009

Anita Dunn: Did She Jump or Was She Pushed?

Two Fridays ago, I wrote this post discussing one editorialists' misunderstanding of Glenn Beck's hotline to the White House Communications Director.

Anita Dunn's early departure from this post was announced by the administration this week. They stressed that she had always been an 'acting' employee, and planned to leave by early next year.

So, no big deal.

Still, it seems that it is a big deal.

Whenever an administration makes a big deal out of saying something is not a big deal, it almost always really is.

In this case, Beck uncovered Dunn's devotion to Mao and general swagger about embracing socialists and communists. Liberals didn't think it all that remarkable, but many voters who thought they elected a moderate, centrist Democrat sure did.

So now Dunn is gone. Beck is unofficially credited with his second kill of Wonderboy's aides. First Van Jones. Now Anita Dunn.

Who will be next? Will he get to be an ace before Wonderboy leaves in 2013?

Now Beck is hamming it up, closing each program with the words,

"...and goodnight Mrs. Dunn, whereEVAH you are!"


Friday, November 13, 2009

Constitutional Fix #5: Congressional Special Treatment

Continuing with my further comments on the list I first enumerated here of ten things which need to be changed in the US Constitution, I want to discuss number 5,

" Special treatment of federal employees/Congress with respect to pensions, healthcare and other benefits"

Among the more frustrating things members of Congress have done is exempted themselves and their entity from various laws which it imposes on all other Americans.

For instance, in the recent health care bills authored by Congressional Democrats, members of Congress were allowed to opt out of the socialized health care that the body will impose on the rest of the nation.

Members of Congress have their own pension and health care benefits. Because so many have made Congress a career, they can legislate perks for themselves which ordinary citizens can never receive.

It would be impossible to mention, in advance, every way in which Congressional members could feather their own nests via legislative exemptions. A simpler approach is to add an amendment to the Constitution prohibiting any language in any bill or law which allows for different treatment of Congressional members from other citizens. No exemptions.

Making this a Constitutional component gives it permanent standing and moves it beyond the reach of any future Congress.

Of course, if we had term limits, this would be less of a problem. However, until, and even then, it simply makes sense to remind federal legislators that they are not above their constituents, and are never entitled to special treatment simply because they won an election.

Thursday, November 12, 2009

House Health Care, Recent & Next Year's Elections

Kim Strassel wrote an interesting column last Friday in the Wall Street Journal.

With the advantage of hindsight, she parsed the voting results in three Virginia House districts which were lost by Republicans last November.

All three districts went for the GOP gubernatorial candidate, Bob McDonnell, by overwhelming majorities, significantly improving margins on John McCain's performance last November. Strassel described the pressure these Democratic freshman Representatives are now under by emboldened GOP challengers for next year's election.

She then tied this backlash of last week to the then-imminent, now passed Frisco Nan House health care bill.

In a telling quote, Strassel declared,

"The Obama presidency was always a race against time."

She wrote of the vote coming in advance of members being influenced against supporting it over the Veteran's Day recess. But, as I noted in this post, it may well be better for them to suffer the furies of voters after the passage of the unreconciled bill. Because they'll have an earful now, and at Christmas, before a marked-up, reconciled version returns from the Senate. And that may not even occur until the Spring thaw.

Never the less, Strassel's observation highlights the coming race between voter outrage, the Democratically-controlled Congress' attempts to enact extremely liberal social legislation, and the first opportunity for voters to hand Wonderboy a defeat at the polls next November.

She characterizes Nan's brazen tactics as putting the Congressional Democrats at a tipping point already, citing Wonderboy's falling poll numbers and their likely impact on wary, fearful Democratic Representatives in those vulnerable districts.

Wednesday, November 11, 2009

Bjorn Lomborg On Global Warming From A Bangladeshi's Perspective

One time Greenie, now rationalist Bjorn Lomborg wrote a priceless editorial in a recent edition of the Wall Street Journal concerning the view on global warming from Bangladesh.

He visited the country to find out how people in a poor, low-lying country feel about what the richer countries propose to do to mitigate the presumed, yet unproven effects of global warming.

Sorry. "Global climate change," since as soon as WarmBoy Al Gore began making the former phrase popular, the damned planet began to cool.


Lomborg writes,

"For Mrs. Begum, the choice is simple. After global warming was explained to her, she said:

"When my kids haven't got enough to eat, I don't think global warming will be an issue I will be thinking about."

One of Bangladesh's most vulnerable citizens, Mrs. Begum has lost faith in the media and politicians.

"So many people like you have come and interviewed us. I have not seen any improvement in our conditions," she said."

So much for patrician UN-types deciding to soak the rich in developed countries for the presumed benefit of the poor in places like Bangladesh. As Lomborg noted,

"Getting basic sanitation and safe drinking water to the three billion people around the world who do not have it now would cost nearly $4 billion a year. By contrast, cuts in global carbon emissions that aim to limit global temperature increases to less than two degrees Celsius over the next century would cost $40 trillion a year by 2010. These cuts will do nothing to reduce the number of people with access to clean drinking water and sanitation."

Lomborg's work has consistently shown that the simplest, cheapest things that can be done by the developed world, e.g., providing clean water and working on basic diseases in the third world, offer the best returns in terms of lives improved and productivity of people around the world.

Now, he's shown that even the very people who would be affected agree with him.

Tuesday, November 10, 2009

Frisco Nan's Health Care Bill

Well, Frisco Nan did it. She rammed through a health care bill in the dead of a Saturday night this past weekend.

And only by the slimmest of margins, losing over 70 of her own party's members who are too afraid of voting for this abomination. And rightly so.

When is the last time you saw Congress actually imposing prison terms for citizens who fail to follow government's edicts on a completely personal matter- health care insurance?

Between income tax filing-related penalties for not showing proof of insurance, and further penalties if you remain uninsured, the liberals now in control of the federal government intends to intrude upon your life to a degree to which Republicans never even dreamt. And the latter are usually the ones accused of such intrusion into private lives, due to their general pro-life, anti-abortion stance.

It's also pretty rich to see suspected bribe-taking Democratic Senator Kent Conrad call Nan's bill's inclusion of another underfunded insurance plan a "Ponzi scheme" of which Bernie Madoff would be proud.

Perhaps civics was one of those areas Wonderboy missed in his drug-clouded youth, because he and Nan are both behaving as if it's just a matter of Senate passage and the signed bill will become law.

Anybody recall that trivial matter of the House and Senate conference to reconcile the two vastly different bills?

Even Max Baucus' grotesquely fraudulent bill, with its understatement of benefits and low-balling of costs, looks affordable next to Frisco Nan's porker.

What's worse is that every single Democratic strategist, pundit, spokesperson and leading legislator blatantly lies when they contend:

-Everyone who likes their current health insurance may keep it.
-Few people will move to the government option.

The truth is this. Most Americans are insured via their employer. When those employers see that the government option, with its interest-free startup loan and subsidized expenses, is a cheaper way to cover their employees, most will dump their current, privately-provided group insurance plans for the government option.

Employees don't actually have a choice in keeping "their" health insurance, because it hasn't been "theirs" to keep to begin with. It's provided by an employer who can change it at will.

Of course, if the GOP's recently-submitted health care proposals, including interstate marketing of health insurance and the extension of tax-preferenced health insurance premiums to individuals, as well as businesses, were in place, then these statements would be true.

But those proposals were ignored by the House and Senate Democrats, so the liberals' contentions on these points are simply lies.

Even the CBO is lying by vastly understating proposed health insurance bill costs by grossly underestimating the numbers of companies which will summarily drop private plans and stampede into unrealistically-low priced government plans.

Because of the Senate's need to pass something, then reconcile it with the House, it may not matter that Nan rushed her bill's passage prior to the Veteran's Day break, during which House members can be expected to be excoriated for its passage.

Maybe it is better that voters can be legitimately outraged over the bill's passage, threatening members with their seats rather than simply bluster against its inevitability.

If a reconciled bill returns for passage, those members may indeed quail at voting for it so close to next November's elections.

Monday, November 9, 2009

Is The Federal Reserve System Constitutional?

The Wall Street Journal carried a very interesting editorial on Saturday by Mark Spitznagel, the hedge fund manager who currently employs Nassim Taleb, the author of a noted book on financial systemic risk, "The Black Swan."

Spitznagel's piece focuses on Austrian Ludwig Von Mises' predictions of credit problems in the 1930s, and his book, The Theory of Money and Credit.

The editorialist cited Von Mises' work as he noted the folly of current Fed interest rate policy,

"Government-imposed interest rates artificially below rates demanded by savers leads to increased borrowing and capital investment beyond what savers will provide. This causes temporarily higher employment, wages and consumption.

Ordinarily, any random spikes in credit would be quickly absorbed by the system- the pricing errors corrected, the half-baked investments liquidated, like a supple tree yielding to the wind and then returning. But when the government holds rates artificially low in order to feed ever higher capital investment in otherwise unsound, unsustainable businesses, it creates the conditions for a crash. Everyone looks smart for a while, but eventually the whole monstrosity collapses under its own weight through a credit contraction or, worse, a banking collapse.

The system is dramatically susceptible to errors, both on the policy side and the entrepreneurial side. Government expansion of credit takes a system otherwise capable of adjustment and resilience and transforms it into one with tremendous cyclical volatility."

With these passages in mind, I wondered aloud, over coffee, to a colleague this weekend whether the Federal Reserve Act was unconstitutional?

How could the income tax have required a constitutional amendment, whereas creating a central bank did not?

Surely, as you read the Constitution, you cannot find any basis on which Congress can simply create a central bank. There's not even a reference to the control of the US currency in the founding document.

From another Journal editorial last year, I know that the creation of the Federal Reserve System dates from the Progressive Era of about a century ago. It was a sop to the Populist movement which demanded free coinage of silver to inflate farmers out of their debt problems.

In retrospect, it's clear that the modern Fed is particularly susceptible to precisely the sort of errors of which Spitznagel, citing Von Mises, writes. Only two Fed Chairmen in its long history are accorded almost unalloyed respect- William McChesney Martin and Paul Volcker. Both are revered for their ability to stand up to administrations and Congress, executing their office's responsibilities for long term US economic health, rather than short term credit demands.

Martin was responsible for the famed Korean War era Accord, by which the Fed was released from its obligation to fund Treasury debt and keep rates low as part of that accommodation. Though a senior Treasury official when he authored the Accord, Martin immediately became Fed chairman upon McCabe's resignation, which was triggered by the fallout from the Accord and Truman's Treasury Secretary's refusal to work any longer with McCabe.

In that linked source on the Accord's history, it is notable that there was an exchange between McCabe and a Senator regarding which had primacy, the Treasury or the Fed. The lack of clarity over this point, and the Fed's "bolted on" nature remains to this day, nearly 60 years later.

It would be asking a lot to now reverse course nearly 100 years after the Fed was created. But I truly fear that we are, as a nation, arriving at several "tipping points" simultaneously, and one of them is the Fed's continuing wrongheadedness with respect to interest rate and liquidity policies.

It has been a major cause of bad credit decisions in the US economy from the day that Alan Greenspan began easing monetary policy in the post-9/11 environment. While not by any means the only governmental actor nor agency which contributed to the real estate-based credit bubble, the bursting of which, in 2007 and 2008, wreaked such global economic havoc, the Fed certainly did more than its share to facilitate the mess.

Its current 0% rate policy seems to be repeating the Greenspan's error of 2001, with hardly a voice of dissent nor caution that we should have learned from the former's mistakes earlier this decade.

I believe Milton Friedman was right on both political as well as economic grounds when he argued for dissolving the Federal Reserve's role in monetary policy and, instead, setting a single annual growth rate for the nation's monetary base.

Such a law, passed by Congress, would certainly be Constitutional, whereas it seems there is absolutely no basis in the Constitution for the creation of the Federal Reserve System.