June 30, 2010

The Summer of ‘Rebound? What Rebound?’ (Update: ADP’s Report Disappoints)

Filed under: Economy,Taxes & Government — Tom @ 8:30 am

flatlineThe folks occupying the la-la land known as the White House are having to regroup now that their “Summer of Recovery” has already gone AWOL.

What we really have is a continuation of the “Rebound? What Rebound?” economy I cited at the very end of last year, when the Associated Press’s Jeannine Aversa attempted to claim that an economic “rebound” was one of the top 10 stories of 2009: A FUDGE (Fear, Uncertainty, Doubt, and Government Excess) economy whose artificially stimulated growth is generating little in the way of jobs.

Yesterday’s Conference Board report on consumer confidence was further evidence that whatever positivity was out there has virtually vanished. The raw number drop from 62.7 to 52.9 (vs. expectations that it would barely budge) was bad enough, but these additional details found in Ruth Mantell’s MarketWatch coverage are truly disturbing:

Consumers with plans to buy a home within six months fell to 1.9% in June – the lowest level since 1982 other than 1.7% in December, according to the Conference Board. In May 2.1% had plans to buy a home.

Those with plans to buy an automobile fell to a record low of 3.7% in June from 6% in May. The data go back to 1967.

Those with plans to buy major appliances fell to 22.9% in June from 26% in May.

Let’s see: What three areas did the government, in its infinite unwisdom, try to artificially stimulate into recovery? Why, it was housing (tax credits), autos (Cash for Clunkers), and durable goods (Cash for Appliances). These are the three areas just described as being in the pits.

2010 is well on its way to being a full year of “Rebound? What Rebound?

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UPDATE: ADP’s employment report released earlier this morning provides no consolation –

Nonfarm private employment increased 13,000 from May to June 2010 on a seasonally adjusted basis, according to the ADP National Employment Report®. The estimated change in employment from April to May 2010 was revised up slightly, from the previously reported increase of 55,000 to an increase of 57,000.

AP reports: “That’s well short of the 60,000 economists polled by Thomson Reuters forecast.”

Nobody’s going to be happy if the private sector job-add number comes in at or below ADP’s number when the government releases its June Employment Situation Report on Friday. One clue that the news might not be good: The press has been trying to manage expectations by speculating about private sector job losses, so when there’s a gain we’ll supposedly be relieved.

Positivity: Shrine of Ugandan martyrs visited by 500,000 for feast day

Filed under: Positivity — Tom @ 7:35 am

From Moroto, Uganda:

Jun 30, 2010 / 02:54 am

Earlier this month over 500,000 people gathered in northeastern Uganda to celebrate the feast day of Saint Charles Lwanga and companions, who are known as the Uganda Martyrs.

Catholic faithful from around Uganda as well as Sudan, Kenya, Rwanda, Tanzania, Burundi and the Democratic Republic of Congo gathered at the shrine of the Uganda martyrs in the Diocese of Moroto on June 3 as part of a pilgrimage for the annual feast day, according to the Catholic charity Aid to the Church Need.

“We are standing on soil that is soaked with the blood of the martyrs,” said Bishop Henry Ssentongo of Moroto told the crowd during the event. Between 1885 and 1887 in Namugongo, 22 young men who served as pages at the Court of King Mwanga were speared to death for holding to the tenets of their Catholic faith instead of assenting to the demands of their ruler.

According to the aid organization, the martyrs were among the first Christian converts in their country. Today, 12.6 million of the country’s 28 million inhabitants are Catholics, and every year some 400,000 are baptized.

Go here for the rest of the story.

Why Ohioans Should Not Let Themselves Be ‘Robbed’

Note: A Washinton Examiner OpinionZone blog post (“Why Isn’t Rob Portman Doing Better?”) by Michael McKenna led me to decide to have the following item that I composed for another purpose a few months ago exposed for wider use.

Although slightly dated, I believe its central points still stand (especially after some updating and revision).

No one would be happier than me if Mr. Portman ends up proving all of what follows wrong in the coming months, and demonstrates that his presence in the Senate won’t “Rob” us. Sadly, I am not at all optimistic that this will occur.

Time is getting short, Rob.

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1. Rob Portman Is NOT a Fiscal Conservative.

U.S. Senate candidate Rob Portman is calling for “a balanced federal budget.”

That’s not the Rob Portman who served in Congress or worked in the Bush administration.

When he served in Congress, Portman’s interest in a balanced budget was questionable at best. During his final few years in office, as he became more comfortable with Washington insiders, conservative watchdog groups like the National Taxpayers Union and Citizens Against Government Waste gave him mediocre grades.

Many point to how highly regarded Portman is by some in the eastern rural areas of the Second Congressional District. But this is the case not because of Portman’s steadfast fiscal conservatism, but because of the earmarked projects he brought to that region, which on the whole continues to struggle economically.

During his final full term in office, Portman was a key “arm-twister” in the effort to pass Medicare Part D, the first new federal entitlement program in almost forty years. Unlike Social Security, which at its inception was intended to be funded, Medicare Part D is a deliberately underfunded entitlement designed to run a deficit every year, just like the health care legislation Congress approved in March that Portman now so vigorously opposes. Part D’s passage provided philosophical aid and comfort to those in Congress whose ultimate goal is taking over the nation’s health care entirely.

During his 53 weeks as President Bush’s Budget Director, his best opportunity to influence the direction of federal spending, Portman reports that he “proposed a balanced budget.” But while he did his job, he continued to perpetuate the misleading reporting of deficit results by including Social Security surpluses of over $150 billion per year and understating the true deficit in federal financial presentations. While he was Budget Director, these surpluses continued to fund day-to-day government operations instead of being set aside as intended to pay the future benefits of retiring Baby Boomers. Rob Portman did nothing to stop this. Additionally, as a congressman, Portman voted against legislation which would have required that any Social Security surplus cannot be spent until the solvency of Social Security and Medicare were guaranteed. Thanks to the government’s rake-off of surpluses, the impact of the recession, and the beginning of the Baby Boomer retirement wave, Social Security is now running monthly deficits.

Based on his track record as a Congressman and the deficits the government ran while he was Budget Director, Rob Portman’s call for a balanced federal budget cannot be taken seriously.

* * * * *

2. Rob Portman stances on illegal immigration and trade demonstrate that he is indifferent (or worse) to America’s sovereignty.

As a congressman, Rob Portman received an average grade of D+ from Numbers USA. This is the same grade Numbers USA gave Mike DeWine and is barely above that given to George Voinovich. The Federation for American Immigration Reform (FAIR) gave Portman a grade of 0% in December 2003. He was clearly willing to cede our national border policy to Mexico. Portman had nothing to say about immigration at his web site until late April. Given his track record and his seeming lack of passion on the subject, the words don’t resonate with me.

While he was President Bush’s Budget Director in 2007, when Congress made its most serious attempt to date to enact amnesty for illegal immigrants. Robert Rector of the Heritage Foundation estimated that provisions in legislation that passed in the House and almost passed in the Senate would have increased retirement-related costs to the government by $2.6 trillion alone. This legislation would have granted amnesty to as many as 10-20 million illegal immigrants and would have enabled each of these newly-ordained citizens to bring over other family members, increasing America’s “legal” population by as many as 103 million people bypassing the proven naturalization process. If Portman did not support this effort, he had a chance to speak out. He did not do so.

Congressman Portman voted against withdrawing from the World Trade Organization in June, 2000, and in doing so further eroded US sovereignty. There is no better example of the potentially disastrous effects of this vote than the current legal battle between Airbus (Europe) and Boeing (US) to supply the next generation of mid-air refueling tankers for the US Air Force. The legal wrangling is taking place in a WTO Court in Europe.  Its most recent ruling was in favor of Boeing. BUT what if it hadn’t been? That ruling can still be reversed. Because of appeals, US tax dollars set aside to buy aircraft for our Air Force may yet be ordered by a foreign court to be spent on foreign aircraft.

As US Trade Representative from 2005 to 2006, Portman stood by while large multinational corporations continued to insist that U.S. manufacturers match “the China price” or lose their business, even though “the China price” was and continues to be heavily subsidized by that country’s government. Thousands of American jobs have been lost and many other American workers have seen their pay and benefits cut because of these strong-arm tactics. Whole sectors of American manufacturing are either gone or nearly gone.

In 2005, during Portman’s first few months as Trade Representative, the Bush administration was prepared to allow a Chinese government-controlled oil company to purchase Unocal, one of America’s largest oil companies. Rob Portman did not publicly oppose this deal, though it would have involved a communist foreign government taking control of a significant percentage of America’s fossil fuel resources.

Portman’s law firm frequently represents foreign governments in trade disputes with the U.S., and did so recently in a losing effort while defending China against charges of dumping steel in the U.S. market.

Rob Portman’s track record as a Congressman, Trade Representative and Budget Director, as well as his legal and business ties, make his support for American sovereignty and American business and industry questionable at best.

Here is how one analyst at a key business and economic think tank evaluates Portman’s trade performance:

This dreadful U.S. trade policy cannot be laid entirely at the feet of Rob Portman. He’s simply being a good soldier. But we see no awareness on his part that continuing on this road will decimate what is left of our manufacturing complex.

The Buckeye State does not need a foot soldier in the U.S. Senate, especially one who doesn’t seem to understand the unintended consequences of what he has been told to do. It needs a leader.

* * * * *

3. Rob Portman has no credible solutions for our country’s serious economic problems.

Note: Everything in this point was the case as of late April. Readers can decide for themselves whether Mr. Portman has redeemed himself on this point by going to this page at his web site and downloading “The Portman Plan for Ohio Jobs: A Path to Prosperity.”

Rob Portman has been very good at telling audiences how bad the economy is and how poorly it is being run by the majority party in Washington. He seems to believe that complaining loudly and frequently is all he needs to do to satisfy Ohio’s voters. It is not.

Until recently, to the extent he said anything meaningful at all about economic solutions, Portman has stated that the most crucial element of reviving the economy is encouraging small-business job growth through tax, regulatory and other incentives. While important, it is by no means nearly enough. There are not enough small businesses positioned to expand by the amount necessary to provide the kind of job growth necessary to put over 10 million Americans back to work.

Portman has offered no solutions for stopping the out-of-control growth of our national debt or our annual budget deficits, and has done nothing to address our negative trade balance — all problems he was instrumental in creating or perpetuating.

But most important, especially to small businesses, U.S. firms are over-regulated by a stifling Washington bureaucracy. Rob Portman’s congressional record, as well as his lobbying and legal connections, show him to be a man who is at peace with that bureaucracy, and won’t fight it when it must be fought. So does his own admission in 2005:

“I probably am a little risk-averse compared to some members [of Congress],” he concedes, “but I think a lot of that is a deliberate decision on my part that some things are worth it for my career and some things aren’t.”

* * * * *

4. If Rob Portman intends to represent Ohio as a U.S. Senator, he has a funny way of showing it.

Portman has been on the campaign trail virtually non-stop since January 14, 2009. Yet he claims that “He currently practices law with the Cleveland, Ohio-based firm of Squire, Sanders, and Dempsey.” What do his law firm’s clients, which include foreign countries currently in trade disputes with the U.S., expect to gain if Portman becomes Ohio’s U.S. Senator? How do their interests differ from everyday Ohioans?

Portman has spent weeks at a time out of the state on fundraisers. In a three-week period in March 2010 alone, he appeared at five fundraisers in Florida, four in Metro Washington, and one each in Oklahoma and Texas. The minimum cost of attendance at all but one of these was $1,000 or more. What do these out-of-state fundraiser attendees expect to gain if Portman becomes Ohio’s U.S. Senator? How do their interests differ from everyday Ohioans?

The day after Congress passed health care “reform,” a step he decried, Portman held a campaign fundraising event with the pharmaceutical industry, a group that will benefit greatly if health care reform is not repealed. Can we really believe Rob Portman as he rails against what come to be known as “ObamaCare”?

As of the latest report cycle (in early spring), Portman had received almost 40% of his campaign funding from out-of state sources, the highest of any Ohio U.S. Senate candidate. What do these out-of-state donors expect to gain if Portman becomes Ohio’s U.S. Senator? How do their interests differ from everyday Ohioans?

Portman has been notably indifferent to the growing Tea Party movement, and members of the movement have been outspoken in their criticism of that indifference. What does Portman think he has to lose by engaging everyday Ohioans who are part of the most important grass-roots movement in generations?

* * * * *

5. Rob Portman Has a Thin Resume, Is a Washington Insider/Career Politician First, and Has Higher Ambitions

Numbers USA’s grading system cites Rob Portman’s record on immigration during his congressional career as a virtual failure to “challenge (the) status quo.” This actually describes Rob Portman’s public life.

In fact, Portman’s own self-description in a 2005 newspaper profile proves it:

“I probably am a little risk-averse compared to some members [of Congress],” he concedes, “but I think a lot of that is a deliberate decision on my part that some things are worth it for my career and some things aren’t.”

We don’t have to ask if principled though unpopular stances are more important to Rob Portman than his career. He has already said that they aren’t. He has told us that he cannot be counted on to fight for what is right when it matters most if it jeopardizes his higher ambitions.

In 2009, the Washington Post (“Portman the Insider: Will Mr. Washington Go to Washington?”) accurately described Portman’s campaign and his intentions:

Portman … is casting himself as a dealmaking insider.

It seems that Rob Portman doesn’t care about how he moves up the political ladder, just that he does. He has already intimated that he wants to be run for president and that becoming a U.S. Senator or Ohio’s governor would be a way of, in his own words, “getting there.”

Will Rob Portman merely use his position as a U.S. Senator as a means of “getting there,” or will he actively represent Ohioans in Washington? Will the Buckeye State be saddled, as New York, Arizona, and Illinois were in 2007 and 2008, with an absentee senator working on his next job, crafting his votes to benefit Washington insiders’ interests ahead of those of Ohioans?

If moving on to what he believes are ultimately bigger and better things means leaving a job undone or barely done, Rob Portman has demonstrated that he will do that, as exemplified by his barely one-year stints as Trade Representative and Budget Director.

It is worth recalling the words of one analyst at a key business and economic think tank on Portman’s trade performance, and how they generally apply:

This dreadful U.S. trade policy cannot be laid entirely at the feet of Rob Portman. He’s simply being a good soldier. But we see no awareness on his part that continuing on this road will decimate what is left of our manufacturing complex.

If Rob Portman believes that the path to higher office requires continuing to be a “good soldier” while American decline continues, it seems that he will choose that path.

* * * * *

6. Rob Portman’s U.S. Senate campaign is an insult to Ohio voters.

While he had a primary opponent, Rob Portman refused to engage him on the issues. When it appeared that his opponent might succeed in making the Republican Primary sufficiently competitive to the point where he could no longer be ignored, the Ohio Republican Party applied intense pressure on that opponent to withdraw from the race and run for a congressional seat instead. Rob Portman has become the GOP’s nominee without having had to articulate who he is, what he stands for, or what he’ll do.

His standard stump speech, one from which he rarely strays, is little more than a recitation of problems with no specific solutions beyond tired platitudes.

Portman’s web presence betrays his aloofness from the electorate. It is fair to question his degree of web site and Facebook involvement or whether he’s even interested in them. There is little if any attempt to truly interact with potential voters. Comments containing questions typically go unanswered. (Note: This has changed to an extent since it was originally written–Ed.)

In sum, Rob Portman is conducting his campaign as if being an “R” in an election year that looks to be bad for anyone who is a “D” will be enough for victory. He speaks almost exclusively at party and fund-raising events, and rarely at possibly risky public events. He is almost legendary for studiously avoiding contact with people, even of his own party, who have had any kind of past disagreement with him. He has failed to take positions on key issues during the past year, including (at least on his web site) whether he as a Senator would have voted for or against the Supreme Court nomination of Justice Sonia Sotomayor.

Ohioans deserve more, and must demand more. They cannot let themselves be “Robbed” of a real U.S Senate campaign about the real issues, and they cannot allow their voices in Washington to be “robbed” by someone whose personal political interests and blind ambition are more important than the peoples’ needs and concerns.

June 29, 2010

Journolist: The Old WaPo-NYT Conspiracy on Steroids?

Filed under: 2nd Amendment,MSM Biz/Other Bias,Taxes & Government — Tom @ 5:03 pm

Back in 2005, I blogged on a news report that confirmed what many of us had long suspected, namely that some of the leading lights of the establishment press routinely shared their notes.

It was based on a long since archived Editor & Publisher article that reported the following (bold is mine):

When the New York Times on July 16 broke the story of a 2003 State Department memo that had become a key element in the Valerie Plame leak investigation, the paper scored a major exclusive. But when the Washington Post hit newsstands that very same Saturday, it had its own version of the same story. It even credited the Times for the same-day scoop.

Welcome to life under the Washington Post-New York Times swap. As part of a secret arrangement formed more than 10 years ago, the Post and Times send each other copies of their next day’s front pages every night. The formal sharing began as a courtesy between Post Executive Editor Leonard Downie Jr. and former Times Executive Editor Joseph Lelyveld in the early 1990s and has continued ever since.

“It seemed logical, because for years we would always try to get a copy of each other’s papers as soon as they came out,” Downie tells E&P. “It made sense to both of us to make it simpler for everybody.” Lelyveld, who left the Times in 2001, declined comment.

The Examiner’s Mark Tapscott, who was elsewhere at the time, commented that “In any other industry, this would be called ‘collusion’ and the Times and Post editorial pages would be in high dudgeon, demanding anti-trust investigations by the Department of Justice.” Tapscott also wondered if the arrangement went beyond headlines. Without getting into details here, there is reason to believe that it did.

I don’t know if the WaPo-NYT headline/info-sharing arrangement is still in place. But it really doesn’t matter, because there is a wider meme-sharing arrangement that appears to be an even stronger parallel news-reporting scheme. It’s known as Journolist. It was headlined as an “echo chamber” at the Politico over a year ago:

For the past two years, several hundred left-leaning bloggers, political reporters, magazine writers, policy wonks and academics have talked stories and compared notes in an off-the-record online meeting space called JournoList.

No one can prove advance planning of anticipated stories without being there, but yesterday’s handling of the McDonald ruling by the Supreme Court should raise serious suspicions.

Yesterday’s ruling, which SCOTUSblog’s John Lowy described as possibly “Much Ado About Not Much,” has been characterized quite differently in the establishment press. Almost no matter where you turn, the reports say that the ruling “extends” gun rights.

Given what a stretch that characterization is, it’s reasonable to ask whether journalists, or I should say “Journolists,” worked on the meme in advance — or, even worse, if they had help from current or former White House “journalists.”

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UPDATE: I’m told that the Journolist effort has been abandoned by someone in a position to know, and that it was “dismantled before the ruling was issued.”

That really doesn’t change the point of this post. The dismantling is roughly a week old, and it’s long been known that a ruling on McDonald was in the works. Thus, there would have been plenty of time for the meme-making machine to work its “magic” before the dismantling occurred — not to mention set up another meme-swapping mechanism we don’t yet know about.

Santelli on Fire: Stop Spending!

Filed under: Activism,Economy,MSM Biz/Other Bias,Taxes & Government — Tom @ 12:44 am

The CNBCers are doing a “better” job of ganging up on him, but Rick Santelli makes the necessary points:

June 28, 2010

The McDonald Ruling: Instapundit’s Take, and the Answer to His Question

Filed under: 2nd Amendment,Taxes & Government — Tom @ 2:45 pm

Glenn Reynolds:

… I’d like to note that a lot of “respectable” commentators were, just a few years ago, calling the individual-rights theory of the Second Amendment absurd, ridiculous, and something that only (probably paid) shills for the NRA would espouse. (I’m talking to you, Garry Wills and Robert Spitzer, among others). Yet it is impossible to read this opinion, and the Heller opinion, and conclude that the individual right is really just a “fraud” concocted by the NRA. So were those who were saying so until quite recently being dishonest, or merely inexcusably ignorant?

For the vast majority of those who have opposed the individual-rights theory, the answer is: “Dishonest.”

RIP …

Filed under: General,Taxes & Government — Tom @ 10:46 am

Robert Byrd.

AP Breaking: Supremes’ Ruling ‘Casts Doubt’ on Chicago Handgun Ban (BizzyBlog Update: The ‘Extended’ Lie)

Lord have mercy, even when it hits him in the face, the Associated Press’s Mark Sherman won’t concede the obvious:

APonGunRulingCastsDoubt062810

“Cast doubt”? Is that what court ruling do now?

A USA Today item has it right:

USATonSupremesGunRuling062810

Other sources describing the ruling accurately include these:

  • CNN — “Court rules for gun rights, strikes Chicago handgun ban”
  • Fox News — “High Court’s Big Ruling For Gun Rights.” From text: “Today’s ruling also invalidates Chicago’s handgun ban.”
  • Reuters, as carried at the New York Times — “Supreme Court Rules Chicago Gun Ban Unconstitutional”

As with the Washington, DC Heller case in 2008, the real outrage is that the ruling was 5-4.

Cross-posted at NewsBusters.org.

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BizzyBlog-only Update: The last paragraph of the ruling (large PDF) –

In Heller, we held that the Second Amendment protects the right to possess a handgun in the home for the purpose of self-defense. Unless considerations of stare decisis counsel otherwise, a provision of the Bill of Rights that protects a right that is fundamental from an American perspective applies equally to the Federal Government and the States. See Duncan, 391 U. S., at 149, and n. 14. We therefore hold that the Due Process Clause of the Fourteenth Amendment incorporates the Second Amendment right recognized in Heller. The judgment of the Court of Appeals is reversed, and the case is remanded for further proceedings.

The Seventh District Court of Appeals had upheld the City of Chicago’s handgun ban. The Supreme Court’s ruling reverses the Seventh District. It is accurate to say that the handgun ban as written by the City of Chicago has been declared unconstitutional. It is not accurate to say that the ruling “casts doubt” on it.

BizzyBlog-only Update 2: The press meme as embodied in the AP’s headline above and frequently seen elsewhere is that the Court “extended” gun rights — as if the ruling broke some kind of new ground.

What an insult to readers’ intelligence. The ruling recognizes the obvious: that the 14th Amendment’s equal protection clause applies to the entire Bill of Rights, not just the parts of it that liberals like.

Has anyone ever tried to make the argument that Ted Strickland and the Ohio Legislature can shut down the Cleveland Plain Dealer because they don’t like its editorials, and that it’s okay because the states have that perogative After all, following the illogic, the Bill of Rights was only meant to protect citizens against the federal government, not state or local ones. Of course not.

Has anyone ever argued that the states can decide to house soldiers in citizens’ homes, that their law enforcement can dispense with the need for Miranda warnings, or that it can establish Catholicism as a state’s official religion? Well, why not? According to the Court’s deranged minority, states can gut the Second Amendment. Why not the others?

Twice in two years, the Court’s minority has outed itself as fundamentally hostile to the Constitution and its Natural Law foundations (in this case, the human right of self-defense, and, when required, to right to defend others against hostile force). The Heller ruling of 2008 was one of so many warnings received before November 2008′s fateful election that so many of the freedoms we hold so dear are hanging by a one-vote thread in the Supreme Court and are at the mercy of the whims of authoritarian politicians and bureaucrats the current Court all too often supports.

June 27, 2010

Geithner Miscasts the 1930s at the G-20 Summit; AP’s Aversa Lets Him Get Away With It

Geithner0109Treasury Secretary Tim Geithner is admonishing the leaders of other countries attending the G-20 summit in Toronto to keep spending like there’s no tomorrow, because if they spend like there’s no tomorrow, there will still be a tomorrow. But in the gospel according to Geithner, if they don’t spend like there’s no tomorrow, there really won’t be a tomorrow.

With such blubbery logic, is it any wonder that America’s stature with the rest of the world is plummeting?

Earlier this evening, Brent Baker at NewsBusters pointed to an ABC report warning that a second recession might be on the horizon if the G20 nations don’t follow the spend-spend-spend recommendations of the Obama administration.

In his attempt to convince the rest of the world of the folly of being fiscally responsible, Geithner has invoked a supposed “lesson” from the 1930s. Back in mid-May, I happened to stumble on the fundamental untruth of his assertion, and will demonstrate it shortly.

The Associated Press’s Jeannine Aversa let Geithner’s contention pass without challenge in her Saturday report on the summit. Here are three relevant paragraphs from her report:

Asked if the global economy could slip back into another “double dip” recession, Geithner said the answer to that question hinges on decisions made by world leaders. “It is within the capacity of the people who are going to be in those rooms together in the next few days to avoid that outcome,” he said.

One of the mistakes made in the 1930s was that countries pulled back their recovery efforts too soon, prolonging the Great Depression, he said.

Geithner said the United States doesn’t want to see that happen again. “What we want to do is continue to emphasize that we are going to avoid that mistake,” he said. “It’s only been a year since the world economy stopped collapsing … it will take some time to heal.”

What follows is a chart showing U.S. spending and GDP from 1923 to 1940, with a partial list of unemployment rates from roughly the same time frame immediately to its right:

FederalSpendingVgdp1923to1940 SelectedAnnualUnempRates1920to1940

Hoover began the federal spending ramp-up in 1931 and 1932, but Franklin Delano Roosevelt and his New Deal took spending as a percentage of gross domestic product (GDP) to the 9%-11%, well over double the level of the Coolidge years. He kept it there until 1940, after which pre-war and wartime spending kicked in. Despite all of what FDR did and tried, unemployment stayed persistently and unacceptably high.

The gospel according to Geithner, as well as hard-core Keynesians like Paul Krugman at the New York Times, would tell us that FDR held up his end of the bargain by keeping the spending spigots open during the eight years that ended in 1940, and that it was the Europeans pulling back who prolonged the recession (Krugman even believes that FDR didn’t spend enough). One would therefore expect that folks living in countries that didn’t hold up their end of the spend-spend-spend bargain during that decade must have endured even more hardships than U.S. citizens did.

But, as I discovered quite by accident on May 13, this isn’t at all what happened. In a Wall Street Journal column, Daniel Henninger quoted an eminent European economist who had passed away a few weeks earlier. In the process of making a point that Henninger used about the mediocre performance of Europe during the 1990s, this historian also, when seen in the context of the graphics just presented, also made a huge point about the Europe of the 1930s:

Angus Maddison, the eminent European historian of world economic development who died days before Europe’s debt crisis, wrote in 2001: “The most disturbing aspect of West European performance since 1973 has been the staggering rise in unemployment. In 1994-8 the average level was nearly 11% of the labor force. This is higher than the depressed years of the 1930s.”

Whoa. Maddison’s assertion leads to these key factoids and points:

  • Europe’s unemployment during the 1930s seldom if ever topped 11%.
  • U.S. unemployment during the 1930s was always above Europe’s level by a few points; another source I found indicates that U.S. unemployment at one point dropped to about 12% in 1937, but the point still stands.
  • Europe’s “failure” to spend as Geithner thinks it should have during the 1930s doesn’t seem to have hurt it nearly as much as FDR’s insistence on continued spending hurt us.
  • If there’s a lesson here, it’s that, absent contrary evidence, Tim Geithner is wrong and the Europeans of the 1930s were right.
  • It would also seem that Europe’s renewed intent to rein in government spending is a wiser course than the spend-spend-spend strategy of the Obama administration (how serious the European countries are about restraining spending remains to be seen; if Europe tries to solve its problem primarily with tax increases, all bets are off).

Jeannine Aversa’s relay of Geithner’s more than likely false assertion about the 1930s deserved much more skepticism that it received.

Cross-posted at NewsBusters.org.

‘Worst Recovery Since World War II’

Filed under: Economy,General,Taxes & Government — Tom @ 5:41 pm

This post went up at the Washington Examiner’s OpinionZone blog early Friday afternoon.

__________________________________________________

Remember how liberal politicians claimed that President George W. Bush was presiding over “the worst economy since Herbert Hoover”? It’s amazing how they couldn’t recall Jimmy Carter’s 20% interest rates and double-digit inflation.

Well, here’s a pull quote from an early Associated Press report on today’s economic growth report from Uncle Sam’s Bureau of Economic Analysis (link is dynamic and subject to change):

“Overall, the U.S. economy may be performing much better than those in Europe, but this is still the weakest and longest economic recovery in U.S. postwar history,” (Capital Economics U.S. Economist Paul) Dales said.

Capital Economics calls itself “The Leading Independent Macroeconomics Research Consultancy.” It appears to be client service-driven, and not to have a particular political agenda.

Mr. Dales’s statement is a damning indictment of the administration’s choice to attempt economic recovery through time-debunked stimulus instead of time-tested tax cuts. This morning’s BEA release of its third estimate of first quarter 2010 gross domestic product (GDP) growth apparently cemented his convictions.

BEA originally estimated in April that the economy grew by an annualized 3.2%. May’s downward revision was to 3.0%. Today’s announcement further reduced the result to 2.7%.

BEA’s estimates for the fourth quarter of 2009 went from 5.7% to 5.9% to 5.6%. Third quarter of 2009 estimates went from 3.5% to 2.8% to 2.2%.

That’s five out of six revisions in a downward direction. By contrast, GDP revisions I tracked from 2005 until the recession as normal people define it began in the third quarter of 2008 were usually upward.

Why the difference? There’s nothing sinister about it, but simply put, the BEA’s models, and economic models in general, tend to be slow to recognize the positive impact of a relatively low-tax, low-uncertainty business environment, and are also slow to pick up on the negative impact of a relatively high-tax, high-uncertainty business climate.

That we are currently in a high-uncertainty situation is beyond dispute. One never knows from day to day what new regulations the current administration in Washington will dream up (just one example: possible health insurance price controls), or who will be the next target of its bully-pulpit wrath. Meanwhile, significantly higher taxes loom beginning next year.

Many businessmen, entrepreneurs, and investors are laying low and focusing on muddling through instead of working on growth and expansion. Who can blame them? As long as the hostile business climate continues, the recovery, assuming it doesn’t run out of steam and turn into a double-dip recession, will continue its historically poor performance.

Slow Joe Biden’s Subpar Saturday: Part 2 — The Slippery Growth Assertion

http://i739.photobucket.com/albums/xx40/mmatters/BidenAs pathetic as Joe Biden’s thin-skinned “Why do you have to be such a smart-a**” comment to a Milwaukee-area custard shop manager was yesterday (covered at NewsBusters; at BizzyBlog), it wasn’t even the Vice President’s worst Wisconsin Saturday moment.

A far worse moment, in terms of familiarity with the truth, occurred as Biden rewrote history and unilaterally revised economic growth upward in a speech to Democrats in support of Senator Russ Feingold’s reelection.

In a CBS News online report by Stephanie Condon that I suspect will make not it to the airwaves Biden was dour and downbeat, while misstating economic reality:

Biden: We Can’t Recover All the Jobs Lost

Vice President Joe Biden gave a stark assessment of the economy today, telling an audience of supporters, “there’s no possibility to restore 8 million jobs lost in the Great Recession.”

Appearing at a fundraiser with Sen. Russ Feingold (D-Wisc.) in Milwaukee, the vice president remarked that by the time he and President Obama took office in 2008, the gross domestic product had shrunk and hundreds of thousands of jobs had been lost.

“We inherited a godawful mess,” he said, adding there was “no way to regenerate $3 trillion that was lost. Not misplaced, lost.”

Biden said today the economy is improving and noted that in the past four quarters, there has been 4 percent growth in the economy. Over the last five months, more than 500,000 private sector jobs were created.

I have no idea how Biden arrived at his $3 trillion figure; I’m guessing Ms. Condon doesn’t either.

One very minor error: The Vice President’s claim that “more than 500,000 private sector jobs were created” is false, but barely. On a seasonally adjusted basis, it’s 495,000, per the Bureau of Labor Statistics.

The big error: GDP growth has been nowhere near 4% during the past four quarters, no matter how you define “the past four quarters” (compounding was ignored for simplicity’s sake):

GDPgrowth4QtrsThru1Q10and2Q10

The 2.5% estimate for 2Q10 is based on the assertion in this Friday Associated Press report that “Economists expect slower growth ahead” from 1Q10′s annualized 2.7%.

Biden’s economic growth assertion is nowhere near true no matter how one interprets it. If 2Q10 growth comes in at an annualized 5.5% or higher, readers can come back and crow that Biden was really right. Good luck with that.

Stephanie Condon should have known better than to blindly relay Biden’s false assertion. Does anyone else besides me think that she would have checked it out if Dick Cheney had said it instead?

Photo at top right is at CBS link via AP.

Cross-posted at NewsBusters.org.

Slow Joe Biden’s Subpar Saturday: Part 1 — The ‘Smart-A**’ Segment

BidenSmartAssRemarkWI062610Matt Drudge is currently linking to the YouTube version (also carried at Real Clear Politics) of Milwaukee TV station WISN’s report on Vice President Joe Biden’s visit to a Greenfield, Wisconsin custard shop. In it, you can hear the following exchange between Biden and the Kopp’s Custard manager:

Biden: What do we owe you?
Manager: Don’t worry. It’s on us. … (inaudible) … Lower our taxes and we’ll call it even.

A more complete version of the station’s report carried at the Freedom’s Lighthouse web site indicates that the comment must have bothered Biden a bit:

Reporter: A few minutes after the Kopp’s manager’s comment on “Lower our taxes,” there’s another exchange.
Biden: Why don’t you say something nice instead of being a smart-ass all the time? Say something nice.

A bit touchy there, aren’t we?

The Real Clear Politics post claims Biden made his “smart-ass” remark “jokingly.”

I don’t think so, nor did the Kopp’s manager, as seen at the extended Freedom’s House version of the video:

Reporter: Afterwards, the manager said he enjoyed his banter with the Vice President.
Manager: He was very nice. He’s got a great personality.
Reporter: But the manager admits the Vice President didn’t seem happy at first about the “lower our taxes” comment.
Manager: I don’t think he liked it, no, but later he whispered … “Just kidding.”

Go to the Freedom’s Lighthouse link and judge Biden’s demeanor for yourself.

Also, doesn’t the manager’s “great personality” comment seem like the kind of thing you might hear about a potential blind date that you would want to avoid?

Cross-posted at NewsBuster.org.

Positivity: Chicago auxiliary installed as bishop of Springfield

Filed under: Positivity — Tom @ 6:55 am

From Springfield, Illinois:

Jun 24, 2010 / 10:01 pm (CNA).- In a two-hour Mass Tuesday morning, Bishop Thomas J. Paprocki was installed as the ninth bishop of the Diocese of Springfield, Illinois.

Over 1,000 people attended the Mass at the Cathedral of the Immaculate Conception.

In his homily, Bishop Paprocki expressed his gratitude to Cardinal Francis George for installing him as bishop, as well as for his guidance over the years.

“It has been my privilege to serve him as Chancellor, as pastor of a parish, and as his auxiliary bishop for the past seven years,” he said. “In so many ways he has truly been a mentor for me, teaching me how to be a bishop, providing an example of how to be a good shepherd caring for the flock of our Lord’s faithful people.”

Noting that the installation Mass was taking place on the feast day of St. Thomas More, Bishop Paprocki spoke about the heroic witness of the saint. Describing his own background in law, he explained, “A wise lawyer like St. Thomas More helped me to recognize that the law of the heart is love.”

“I see my primary task as bishop is to love you, more precisely, to radiate Christ’s love with the help of God’s grace throughout the twenty-eight counties of central Illinois that comprise the State of Illinois,” he said. “I come to our state capital not as a sort of Catholic lobbyist, but as a shepherd of souls.”

The bishop went on to say that he must proclaim the truth in order to radiate Christ’s love. “Pope Benedict XVI made this connection between love and truth the focus of his encyclical letter, Caritas in Veritate,” he said.

“The second major task that I see for a Catholic bishop is to be the center of unity for the Christian community,” Bishop Paprocki said. He called to mind the famous speech of Abraham Lincoln, delivered in Springfield in 1858.

“Mr. Lincoln quoted the Bible in reminding people that a ‘house divided against itself cannot stand,’” he said. Recalling President Lincoln’s commitment to preserving the Union, he continued, “So also a bishop must make every effort to be a sign of unity among all Christians and solidarity among all the peoples of this world.” …

Go here for the rest of the story.

June 26, 2010

Who Can Ignore and Downplay Democrat’s Racist Statement? The Establishment Media Can

Kanjorski0610To refresh, as posted at NewsBusters and Eyeblast.tv, Pennsylvania Congressman Paul Kanjorski said the following on Wednesday while he was defending what Investors Business Daily has called “Financial Deform”:

We’re giving relief to people that I deal with in my office every day now unfortunately. But because of the longevity of this recession, these are people — and they’re not minorities and they’re not defective and they’re not all the things you’d like to insinuate that these programs are about — these are average, good American people.

This isn’t too tough to decipher, no matter how many House Democrats try to give him defensive cover — If the people Kanjorski “deal(s) with in my office everyday” are “average, good American people” because “they’re not minorities and they’re not defective,” then those who are minorities and “defective” in some way are not “average, good American people.” Kanjorski uttered an objectively racist (embodying “the belief that race accounts for differences in human character or ability and that a particular race is superior to others”) statement.

According to this report, Kanjorski is not apologizing. Therefore, one must conclude that the congressman is comfortable with his objectively racist statement.

The mostly Democrat-defending establishment press that generally sets the narrative for radio and TV news mostly understands the aforementioned elementary exercise in logic. This explains why Kanjorski’s statement, while occasionally being framed with the usual “Republicans attack poor misunderstood Democrat” approach, is mostly getting ignored.

A search at the Associated Press’s main web site on the Congressman’s last name comes up with one seemingly relevant item, an article headlined “McMahon: Wrestling was soap opera.” Yeah, you read that right. But the article is really a collection of four short items and two “Quick Hits.” AP writer Philip Elliott (or perhaps his editors) thought that Connecticut U.S. Senate candidate Linda McMahon’s description of her Word Wrestling Entertainment enterprise was more important than Kanjorski’s racist remark, the coverage of which came second.

Naturally, Elliott’s item used the “Republicans attack” technique:

Republicans criticized Rep. Paul Kanjorski for what they said were remarks suggesting minorities are not “average, good American people.”

The 13-term Pennsylvania Democrat vigorously denied the charge, saying Republicans were taking his words out of context to score political points.

… A Kanjorski spokeswoman said the congressman was defending people who get government help from those who unfairly criticize them.

Sure he was. But in the process, he uttered an objectively racist remark. Alleged “context” is irrelevant.

Well, at least the AP has covered it in its own quirky way. The New York Times hasn’t.

The Washington Post restricted coverage of Kanjorski’s statement to its “44″ blog, and has apparently kept the matter out of its print edition. Matt DeLong’s post is funny, in a reality-denying, sickening sort of way (bolds are mine):

A Democratic congressman has found himself the target of conservative criticism after an inartful description of who will be helped by the financial reform bill currently working its way through Congress.

The conservative website Human Events reported that Rep. Paul Kanjorski’s (D-Pa.) appeared to say during Wednesday’s financial reform conference committee meeting that the financial overhaul will help “average, good American people” — but not minorities or “the defective.”

It’s amazing how often the word “inartful” — which isn’t even a recognized word in the dictionary (here or here) — has appeared since candidate Barack Obama and others frequently employed it in 2008 to defend him and others after verbal gaffes and worse utterances.

As to DeLong’s use of “appeared” — Matt, stop insulting our intelligence.

Finally, it’s also quite predictable to see DeLong tag Human Events (accurately) as “conservative,” while, as Tim Graham at NewsBusters noted earlier this week, magazines like Rolling Stone almost never get the “liberal” or “radical left” tag from the establishment press.

Cross-posted at NewsBusters.org.

IBD on Deformed ‘Financial Reform’

Filed under: Economy,Taxes & Government — Tom @ 8:38 am

Maybe it’s time for “FRINO,” a new acronym that would stand for “Financial Reform In Name Only.”

On second thought, the reality as described in the last two excerpted paragraphs below from an Investors Business Daily editorial Friday evening is much more sinister than that, rendering such an acronym an inadequate descriptor:

For instance: Fannie Mae and Freddie Mac, which were inarguably at the heart of the financial crisis, and which have already cost U.S. taxpayers $146 billion (with hundreds of billions more on the way), aren’t addressed in this bill at all.

This is insane, given the role these two government-sponsored enterprises played both in encouraging lending to poor, unqualified homebuyers and repackaging those securitized loans for resale to banks and investors around the world. (Ed. Note: The repackaging was also done in a systematically fraudulent manner for about 15 years.)

Worse, the bill does nothing to amend the “too-big-to-fail” doctrine that has guided U.S. banking policy for decades. Any bank that runs into trouble can still walk up to Uncle Sam’s borrowing window and, hand outstretched, ask for money. And if the bank is politically connected or very large, it will get it.

This puts every small bank, investor or lender at a huge disadvantage, since they’re most certainly not “too big to fail.” This is a big reason why the biggest U.S. banks didn’t squawk too much about the legislation. As bad as it is, it gives them a competitive edge.

The bill also gives federal regulators sweeping new powers to seize and break up financial firms. Good idea, you say? Remember: The government also gets to decide what is a “financial” firm. Does GM, which makes loans, fall into that category? How about Wal-Mart, which issues its own credit cards?

In effect, this lets the government seize and dismantle the assets of almost any company — and then force others to pay for it.

This enables those who would wish to exercise such powers to engage in financial tyranny. Not even angels, let alone the dictator wannabes in this administration (Example 1: John Holdren; Example 2: Zeke the Bleak Emanuel; Exhibit 3: Cass Sunstein), should be entrusted with such unaccountable command-and-control authority so easily abused for political purposes.