July 27, 2011

AP’s Abrams, Quoting No One, Claims That ‘Some Legal Scholars’ Believe Obama Can Bust Debt Ceiling With 14th Amendment

Gosh, isn’t it convenient that Associated Press reporter Jim Abrams, in a Wednesday evening dispatch (“Democrats say Obama should invoke 14th Amendment”), was able to find “some legal scholars” who believe that President Obama can invoke Section 4 of the 14th Amendment to the Constitution to ignore the nation’s current debt ceiling and have the government go out and borrow more money, but “somehow” didn’t name any? Not only that, he didn’t even tell readers why 14th Amendment power creationists might be wrong, let alone find “some other” dissenting legal scholar to explain why. Instead, he instead went to White House spokesman Jay Carney, who only said that the president doesn’t have such authority.

I suspect that Abrams’ “oversight” occurred because the only “legal scholars” he could have cited would have been uncomfortable Democrats in Congress who don’t want to be on record voting against any and every effort to control spending which might be attached to whatever bill or bills House Republicans might attempt to pass — a matter of fierce internal GOP debate as of late Thursday evening.

Even Harvard Professor Laurence Tribe, that lefty of all lefties, in a New York Times op-ed earlier this month (“A Ceiling We Can’t Wish Away,” with “We Cannot Pretend the Debt Ceiling Is Unconstitutional” as its browser window title), couldn’t abide this ridiculous argument. He also included a now-ironic (and bolded by me) assertion about the Constitution by President Obama himself in his second-last paragraph:

Several law professors and senators, and even Treasury Secretary Timothy F. Geithner, have suggested that section 4 of the 14th Amendment, known as the public debt clause, might provide a silver bullet. This provision states that “the validity of the public debt of the United States, authorized by law … shall not be questioned.” They argue that the public debt clause is sufficient to nullify the ceiling — or can be used to permit the president to borrow money without regard to the ceiling.

Both approaches provide the false hope of a legal answer that obviates the need for a real solution.

The Supreme Court has addressed the public debt clause only once, in 1935, in the case of Perry v. United States. The court observed only that the clause confirmed the “fundamental principle” that Congress may not “alter or destroy” debts already incurred.

Some have argued that this principle prohibits any government action that “jeopardizes” the validity of the public debt. By increasing the risk of default, they contend, any debt ceiling automatically violates the public debt clause.

This argument goes too far. It would mean that any budget deficit, tax cut or spending increase could be attacked on constitutional grounds, because each of those actions slightly increases the probability of default. Moreover, the argument is self-defeating. If it were correct, the absence of a debt ceiling could likewise be attacked as unconstitutional — after all, the greater the nation’s debt, the greater the difficulty of repaying it, and the higher the probability of default.

… The Constitution grants only Congress — not the president — the power “to borrow money on the credit of the United States.” Nothing in the 14th Amendment or in any other constitutional provision suggests that the president may usurp legislative power to prevent a violation of the Constitution.

… Once the debt ceiling is breached, a legal cloud would hang over any newly issued bonds, because of the risk that the government might refuse to honor those debts as legitimate.

A core function of the Constitution is to “force us into a conversation” about our future, Mr. Obama once wrote.

Tribe’s Obama cite is intensely ironic, given that the President has yet to effectively join the conversation by presenting a detailed plan of his own. In fact, in his speech Monday night,

None of this stopped the AP’s Abrams from spending 400 or so words on the 14th Amendment option, including a final paragraph containing a reference to “some legal scholars”:

House Democrats said Wednesday that President Barack Obama should invoke a little-known constitutional provision to prevent the nation from going into default if Congress fails to come up with a plan to raise the debt ceiling.

Rep. James Clyburn of South Carolina, a member of the Democratic leadership, said he told fellow Democrats that Obama should both veto any House GOP plan for a short-term extension of the debt ceiling and invoke the 14th amendment, which says that the validity of the nation’s public debt “shall not be questioned.”

The White House has rejected resorting to this tactic to keep the nation from defaulting, questioning its legality, but Rep. John Larson of Connecticut, who chairs the Democratic caucus, said “we’re getting down to decision time” and “we have to have a failsafe mechanism and we believe that failsafe mechanism is the 14th Amendment and the president of the United States.”

Larson said Clyburn’s proposal on the 14th Amendment was met with applause by other Democrats at their meeting.

The post-Civil War 14th Amendment guaranteeing citizenship to all people born or naturalized in the United States contains a provision that “the validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”

Some legal scholars have said the president can invoke that clause to keep the nation from defaulting on the debt, although there is no legal precedent for such an action.

The problem, as Matt Vadum explained in the American Spectator on July 5, is that Article 1, Section 8 of the Constitution says that “The Congress shall have Power … To borrow Money on the credit of the United States.” If Congress doesn’t authorize it, it can’t legally be done. That’s about as airtight as an argument can get. Also, as Tribe noted, bond marketers and investors would have a hard time justifying taking an obvious legal risk by buying Uncle Sam’s bonds in such a situation. (Snarky aside: But Ben Bernanke and his magical electronic printing machines probably wouldn’t.)

As to the AP’s Abrams, you’re going to have to name names before I believe you actually spoke with someone about the constitutionality of the 14th Amendment debt-ceiling gambit. Until you do, I’m going to interpret “some legal scholars have said” to mean “I personally think it would be a cool idea.”

Cross-posted at NewsBusters.org.

Lowering the Bar: Reuters Sets 2.5% GDP Growth as Unemployment Rate-Lowering Benchmark

Filed under: Economy,Taxes & Government — Tom @ 12:39 pm

ReutersLogo.pngI guess at Reuters, when you see that an economy can’t meet normal benchmarks for success, you simply lower them, and pretend that success will come anyway.

Over at the Associated Press a few weeks ago, in his write-up in the wake of the government’s awful June employment report, Chris Rugaber correctly pegged the kind of economic growth it will take to get millions of currently unemployed Americans back to work again: “The economy would need to grow 5 percent for a whole year to significantly bring down the unemployment rate.”

That standard was way too high for whoever wrote an unbylined item at Reuters on Tuesday (bold after title is mine):

Weak auto output, pricey gasoline to clip Q2 growth

WHAT: First reading on U.S. second-quarter GDP

WHEN: Friday, July 29, at 8:30 a.m. EDT

FACTORS TO WATCH

A contraction in motor vehicle production because of a shortage of parts from Japan and high gasoline prices that curbed consumer spending, probably kept the U.S. economy on a slow growth path in the second quarter.

Growth in the world’s biggest economy is projected to have weakened to a 1.8 percent annual rate after a tepid 1.9 percent pace in the first three months of the year.

The economy would need to grow at a rate of 2.5 percent or better on a sustained basis to chip away at the nation’s 9.2 percent unemployment rate.

The trouble is, as seen here, GDP growth has averaged an annualized 2.8% in the seven quarters since the recession as normal people define it ended in the second quarter of 2009, while the unemployment rate chip-away has been minimal:

NSAandSAunemployment0109to0611

By contrast, also seen at the linked graphic, average annualized growth during the first seven quarters of the early 1980s recovery under Ronald Reagan was 6.6%. Not coincidentally, employment grew by almost 5.3 million during those seven quarters (the equivalent of about 8 million today), and the unemployment rate dropped from 10.1% to 7.2%.

My message to Reuters: Chip, schmip. We won’t get to an unemployment rate of even 7% for 15 years at the current rate of “chipping” (2.2% required seasonally adjusted drop from the current 9.2% divided by average seasonally adjusted drop of 0.15% per year since the recession ended).

The not seasonally adjusted table indicates that the June 2011 jump in actual, on-the-ground unemployment was as bad as June 2009′s. That would appear not to bode well going forward. After the same thing occurred two years ago, the seasonally adjusted rate jumped by over a half-point during the next four months. During that period, GDP growth average an annualized 1.6% in the third quarter, and 5.0% during the quarter containing October, or an average of 2.45% over four months, i.e., just under Reuters’ alleged benchmark of 2.5%. A lot of good that level of growth did then. That kind of growth won’t do us much good now either, no matter how far Reuters lowers the bar.

Cross-posted at NewsBusters.org.

IBD: ‘Progressive’ Policies Hit Minority Wealth Hardest; Fan, Fred, and Dems to Blame

Filed under: Economy,Taxes & Government — Tom @ 10:59 am

Well of course they do, and of course “progressive” policies are to blame, as a Tuesday evening Investors Business Daily editorial aptly details (bolds are mine):

New Census data show that the recent economic crash has erased decades of minority gains in wealth. The net worth of whites is now 20 times higher than for blacks and 18 times higher than for Hispanics, both records.

For white households, the median net worth (assets minus liabilities) in 2009 was $113,149. That compares to $6,325 for Hispanics and $5,677 for black Americans.

… If nothing else, these data point out the failure of federal welfare and anti-poverty policies to do what they intended: eradicate wealth differences in our country.

Starting in 1964, when President Johnson launched the War on Poverty, a well-intentioned crusade to end poverty, the U.S. has spent an estimated $16 trillion trying to help the less well-off.

LBJ and other well-meaning Democratic politicians at the time also hoped that the burgeoning welfare state would make people more self-sufficient, a noble goal. It didn’t work.

while the U.S. has more than 70 means-tested welfare programs, the poverty rate today is higher than it was in the late 1960s.

How can that be? “(M)ost anti-poverty/welfare spending erodes work and marriage,” wrote Robert Rector, a Heritage Foundation economist, in a recent report. “As a result … low-income Americans are less capable of self-support than when the War on Poverty began.”

The most recent leg down in minority wealth is due almost entirely to America’s massive housing market intervention — funded by Fannie Mae and Freddie Mac, overseen by HUD and pushed by influential Democrats. It has only made things worse.

Starting with President Clinton, the federal government coerced banks into making loans to uncreditworthy minority borrowers to boost homeownership.

The implicit subsidy in this arrangement was itself a form of welfare. When the housing market tanked, it was inevitable that those mostly minority households would have higher delinquency and default rates, and lose much of their wealth. That’s what happened.

As to housing, President Obama was a prominent community-organizing, frontline advocate for the very policies which destroyed so much wealth and which, as IBD noted, disproportionately affected minority households.

Yet to most, he’s still their hero, while the corrupt cronies who did the dirty work at Fannie Mae and Freddie Mac not only remain filthy rich, but in many cases are still powerful Washington insiders.

More generally, the POR (Pelosi-Obama-Reid) Economy, the deep recession it created, and the pathetic “Rebound? What Rebound?” recovery which has followed, are Democratic Party creations which have disproportionately the poor and lower middle-class.

Con artists know that the best scams are the ones where the victims don’t even realize that they’ve been taken. By that benchmark, Fan, Fred, and the Democratic Party have pulled off one of the most “successful” scams of all time.

Positivity: Adult stem cells may improve cardiac function in angina patients

Filed under: Health Care,Positivity — Tom @ 5:58 am

From Chicago (HT Future Pundit via Instapundit):

July 7, 2011
Study finds improvement in chest pain and exercise tolerance

CHICAGO — New research published online today in Circulation Research found that injections of adult patients’ own CD34+ stem cells reduced reports of angina episodes and improved exercise tolerance time in patients with chronic, severe refractory angina (severe chest discomfort that did not respond to other therapeutic options).

The phase II prospective, double-blind, randomized, controlled clinical trial was conducted at 26 centers in the United States, and is part of a long-term collaboration between researchers at Northwestern University Feinberg School of Medicine and Baxter International Inc. The objective of the trial was to determine whether delivery of autologous (meaning one’s own) CD34+ stem cells directly into multiple targeted sites in the heart might reduce the frequency of angina episodes in patients suffering from chronic severe refractory angina, under the hypothesis that CD34+ stem cells may be involved in the creation of new blood vessels and increase tissue perfusion.

“Early research across multiple disease categories suggests that stem cells generated within the body in adults may have therapeutic benefit. This is the first controlled trial treating chronic myocardial ischemia (CMI) patients with their own stem cells to achieve significant reductions in angina frequency and improvement in exercise tolerance,” said lead investigator Douglas W. Losordo, MD, director, Feinberg Cardiovascular Research Institute and the Eileen M. Foell Professor of Heart Research at Northwestern’s Feinberg School of Medicine and director, Program in Cardiovascular Regenerative Medicine at Northwestern Memorial Hospital. “While we need to validate these results in phase III studies before definitive conclusions can be drawn, we believe this is an important milestone in considering whether the body’s own stem cells may one day be used to treat chronic cardiovascular conditions.”

The research team mobilized and extracted stem cells from all participants before randomizing them to one of three treatment groups: low- or high-dose cell concentrations, or placebo, and administered the regimens in 10 distinct sites in the heart tissue through a multi-point injection catheter.

At six months after treatment, patients in the low-dose treatment group reported significantly fewer episodes of angina than patients in the control group (6.8 vs. 10.9 episodes per week), and maintained lower episodes at one year after treatment (6.3 vs. 11 episodes per week). Additionally, the low-dose treatment group was able to exercise (on a treadmill) significantly longer at six months after treatment, as compared with those in the control group (139 seconds vs. 69 seconds, on average). Angina episodes and exercise tolerance rates were also improved in the high-dose treated group at six months and at one year post treatment compared to the control group.

“The concept of using one’s own stem cells to treat disease is highly attractive to the medical community and this research is consistent with Baxter’s commitment to driving scientific advances that can lead to promising new treatments for critically ill patients,” said Norbert Riedel, Ph.D., Baxter’s chief scientific officer. “These results provide important insights into the potential for these cells to be used in larger scale settings, and we look forward to moving into phase III studies in the near future to hopefully substantiate these results.” …

Go here for the rest of the press release. The full Circulation Research article is here.