Seeking Liberty

Liberty is the Fruit from Which All Progress Grows

Fix the Balance Sheet, Fix the Economy

Just about everybody realizes that the Stimulus did did not stimulate our economy. In fact, it was probably quite counter-productive, since the borrowed debt and newly printed Dollar Bills have severely weakened the Dollar in comparison to other currencies like the Euro, Yen and Pound Sterling. Now, with the realization fully in the mind of the American people, President Obama and others are suggesting that we pull the repaid from the TARP program and unspent stimulus funds to spend it on “job creation.” Fortunately, some in Washington oppose these ideas.

Pardon me, but wasn’t this what the Stimulus Bill was for? Wasn’t it passed to stem the rising unemployment rate at no more than 8 percent? Shouldn’t the funds in the Stimulus Bill have already been spent “creating” jobs?

The answer, of course, is no. Read the rest of this entry »

Filed under: economics, taxes, wealth, , , , ,

Reverse Course to Right Our Economy

Can we just admit that the Stimulus was an $800 billion mistake that did absolutely nothing to help the economy or stimulate jobs?

Can we admit that Keynesian economics are, at best, a scalpel being wielded as though a they were a machete?

Can we admit that no centralized government planning will ever lead to greater economic prosperity?

Because if you really can’t admit that, you really haven’t been paying attention.

For the past several years, we’ve been told that America needs more regulation, that the wealthy need to pay their “fair share,” that free market economics aren’t enough any more.  We’ve been told some companies and some banks are just “too big to fail,” and that we the taxpayers have to step in and “save” them from their failures.  We’ve been told that the managers of these companies, even the ones that have righted their boats, don’t deserve the high levels of compensation they earn.  That if these wealthy people weren’t so greedy, we’d all have more.

The media and the Democrats will tell you that the the CEOs and senior executives of these big corporations are giving themselves big bonuses and big pay-raises.  There’s just one problem with that concept: Read the rest of this entry »

Filed under: economics, health care, socialism, taxes, wealth, , ,

Caulk won’t save our economy.

To improve our economy, President Obama wants us to spend tens of billions of dollars on… Caulk.

That’s right. The President believes that both our energy situation and the unemployment issues that far out-strip any projections made by his economic team can be solved by “weatherizing” our homes. All we need to do is hire hundreds of thousands of union laborers to add weatherstripping and caulk to lower our energy costs. This will have a ripple-effect that will resonate throughout our economy and kick-start the jobs machine. To do this, the Stimulus Package already signed into law provided billions of dollars for training workers to install caulk and other weatherizing improvements into people’s homes.

This is all part of President Obama’s “Green Jobs” initiative, which he extensively campaigned on and continues to hold up as the future of our domestic economy. He even went so far as to call insulation “sexy.”

I have a “sexy” idea for President Obama: Instead of focusing on “green jobs,” how about focusing on “jobs?” We can worry about the “green” part when we get back to that 8% unemployment level that he said his magical stimulus would prevent us from ever topping. Read the rest of this entry »

Filed under: economics, environment, Government, politics, taxes, wealth, , , , , , , , ,

Unemployment is up? This calls for immediate stalling!

As unemployment reaches 10.2 percent and another 502,000 jobless claims are filed, President Obama promises swift action:

The announcement came as the Labor Department reported another 502,000 new jobless claims, two high-tech mainstays announced big layoffs and the unemployment rate reached 10.2 percent.

Obama said the White House forum will gather CEOs, small business owners, economists, financial experts and representatives from labor unions and nonprofit groups “to talk about how we can work together to create jobs and get this economy moving again.”

I don’t know why this Administration keeps reminding me of Monty Python. Maybe because it’s so apropos. Read the rest of this entry »

Filed under: economics, Government, liberty, wealth, , , , ,

Feinberg Claws Back

In yet another stunning economic folly, the Obama Administration has chosen to “claw back” the salaries of the top 25 executives at seven firms that received TARP funds last fall. In addition, the Treasury Department’s Kenneth Feinberg announced he would force American Insurance Group to restructure and reduce the $198 million contractual compensation packages at its financial products division.

In contrast to previous years, an official said, executives in the financial products division will receive no other compensation, such as stocks or stock options.

And at all of the companies, any executive seeking more than $25,000 in special perks — such as country club memberships, private planes, limousines or company issued cars — will have to apply to the government for permission. The administration will also warn A.I.G. that it must fulfill a commitment it made to significantly reduce the $198 million in bonuses promised to employees in the financial products division.

There was a much easier answer to this whole question, and it didn’t involve billions of taxpayer dollars being spent on companies “too big to fail.” That option is called bankruptcy. Read the rest of this entry »

Filed under: economics, Government, wealth, , , ,

Ignoring economics, C.A.R.S. hurts used car dealers, working families

It would seem that the Cash for Clunkers program has had two major side effects: The sharp decline in sales of new automobiles after the program ended, and a sharp increase in the price of low-end used vehciles, the type that poor and lower-middle class families buy.

From the Reading Eagle:

In her search for a cheap, used minivan for her and her husband, Krissy Dieroff has visited seven dealerships across Berks and Schuylkill counties in the last week, but to no avail.

“There’s not much to pick from, and the ones we do find are overpriced,” said Dieroff of Auburn, Schuylkill County, while browsing the lot of a city dealership on Monday.

Dieroff blames the shortage of inexpensive used cars on the federal cash-for-clunkers program, in which almost 700,000 used vehicles were traded in for newer, more fuel-efficient vehicles, and then scrapped.

Those clunkers were the cars Dieroff and her husband, Jason Boyer, would have been shopping for, they said.

“I saw the cars they were putting in the junkyard, and they were better than what we’re driving now,” Boyer said.

Not that this should be a surprise to anyone. The Car Allowance Rebate System (“CARS” or Cash for Clunkers”) ignored the very basics of economics: Incentive and utility. It gave people an incentive to BUY NOW! instead of waiting for a more appropriate time to buy a new car, and it ignored the inherent utility of the low-mileage, low-end cars to the poor and middle-class families who buy older used cars.

That’s bad news in Berks, where many shoppers seek inexpensive, used vehicles, especially during difficult economic times, said George Tabakelis, general manager of Perry Auto Service & Sales on Route 61 in Perry Township.

“Customers used to be able to find a good car for their son or daughter to take to college for $2,000 or $3,000, but now that same car may cost $5,000,” Tabakelis said. “It’s sad.”

He, too, blames cash for clunkers, which has led to fewer vehicles being available at used-car auctions, and the recession.

It’s the age-old issue of supply and demand: When you have steady or increasing demand and a decreasing supply, scracity becomes a problem. When more people demand a good or service than can be supplied, the price of that good or service will inevitably increase to ween away those who are least able or willing to afford it.

With 700,000 fewer low-end used automobiles on the market and the number of unemployed and under-employed people in working families steadily increasing, the government’s Cash for Clunkers program simply exacerbated the problem of finding affordable automotive transport for poor Americans. The supply has shrunk while demand is increasing, creating an economic catastrophe that is only of the Government’s making.

The Cash for Clunkers program represented less than $3 billion in Federal spending, yet it has caused far more harm than good. The net result has been the destruction of wealth and the further deepening of the economic mess in which we currenly find ourselves. Ignoring the basics of economics and the free market has harmed far more than it has helped.

The old axiom that “The road to Hell is paved with good intentions” seems apropos.

Originally posted at The Minority Report.

Filed under: economics, Government, poverty, wealth, , , , , , , , , ,

Dollar Daze

National Public Radio is reporting that the Dollar has fallen, and foreign banks are increasingly keeping Euros and, of all currencies, the Yen as their reserve denomination. The Dollar has fallen 12% from its recent peak, and appears likely to lose additional value.

Quote:

In March 2008, before the financial crisis, the dollar was at historic lows against a basket of currencies. Then, when the financial storm struck, the dollar strengthened as investors rushed to the safety of U.S. Treasury securities.

Now that the worst of the crisis appears to have passed, the dollar is under pressure again. It’s down more than 12 percent from its recent peak. Fred Bergsten of the Peterson Institute for International Economics says sentiment about the dollar has now turned negative.

While this is alarming to many, to some it is no surprise. In fact, many economists predicted after the Bush Administration’s Troubled Asset Relief Program (TARP) and the Obama Administration’s Stimulus bill, the hundreds of billions of extra Dollars being dumped onto and the mounting deficits of the United States Government would depress the Dollar significantly when compared to other currencies.

The result: Americans are poorer now than they have been, compared to the rest of the world. Since the Dollar has lost value, it takes ever more Dollars to buy products from other nations. Fears of more and greater deficits in the coming years create even greater distrust of the Dollar, resulting in more hedging with other currencies. It is a wicked spiral that can only be broken by more responsible actions by our government.

The United States must come back to reality: We can no longer spend like bachelors on a weekend in Las Vegas, signing for ever greater lines of credit to cover our losses. The International Casino is rapidly approaching the point where it will call in our debts, while we have blown our chips at the craps table. Read the rest of this entry »

Filed under: economics, Government, politics, poverty, wealth, , , , , , , , , , , ,

Clunked Out

Car dealers are facing the boomerage effect of the so-called Cash for Clunkers program.  Dealers are reporting showrooms empty of customers.  Chrysler/Fiat is reporting sales are down 19%.  Toyota is planning a $1 billion marketing campaign and adjustments in dealer pricing to try to lure more people back to stores and help dealers close deals.

Despite hugely improved sales in July and August, September sales are set to be among the lowest in 28 years, tying an industry record low on statistics kept since 1976.

The problem is exactly what so many predicted would happen:  Hundreds of thousands of people who would otherwise have waited and bought new cars over the next several months instead bought them in July and August, cashing in on the government-sponsored incentive.  Now that those incentives are gone, there are fewer consumers looking to buy cars.  Instead of a natural progression of steady but low sales, the market experienced a brisk rise in sales and will now face lower sales over the coming months. Read the rest of this entry »

Filed under: economics, Government, wealth, , , ,

Science? What Science?

Professor Mojib Latif of the Liebniz Institute is a leading climate researcher. He is one of the major authors of the UN’s International Panel on Climate Change (IPCC) Five Year Reports that declared global warming to be definitely caused by man and that this is a serious threat to the planet.

Last week, Latif changed his tune:

Latif is one of the leading climate modellers in the world. He is the recipient of several international climate-study prizes and a lead author for the United Nations Intergovernmental Panel on Climate Change (IPCC). He has contributed significantly to the IPCC’s last two five-year reports that have stated unequivocally that man-made greenhouse emissions are causing the planet to warm dangerously.

Yet last week in Geneva, at the UN’s World Climate Conference–an annual gathering of the so-called “scientific consensus” on man-made climate change –Latif conceded the Earth has not warmed for nearly a decade and that we are likely entering “one or even two decades during which temperatures cool.”

This is major news, but no one is reporting it. So far, the vast majority of articles are from outside the U.S. Read the rest of this entry »

Filed under: environment, Government, politics, wealth, , , ,

A Slice of Tyranny

I don’t play golf.  I’m awful.  I can’t hit the ball straight to save my life.  In fact, I have been asked to leave driving ranges for injuring other golfers.  I have been in situations where the ball ends up behind me on so many occasions I am convinced that I am cursed.  Despite many hours of coaching, I continue to churn out horrific results at the golf course.

I think Venezuelan President Hugo Chavez has the same problem:
Golf Swing. Linked from Wikipedia

Of golf, Chavez declared recently in the city of Maracay: “I think it is a bourgeois sport and there’s no justification for having a golf course in the middle of a city where there is so much housing need for the people.

“Even though there are slums, you have 30 hectares so a little group of bourgeois and petit-bourgeois people can go and play golf … They are so lazy, they use carts!” he mocked.

Although a lover of sports, especially baseball, Chavez’ comments brought into the open — and instantly politicized — the decline of golf facilities in Venezuela. Various courses have shut in recent years, and others may go the same way if authorities decide to put Chavez’ words into action.

And it seems the government has no small part in the decline of the sport there: Read the rest of this entry »

Filed under: liberty, socialism, wealth, , , ,