October 11, 2011

Intensity Update: Cain, by Miles

Filed under: Taxes & Government — Tom @ 2:28 pm

From Gallup a week ago:


Intensity = Strong positive evaluation percentage minus strong negative.

Further, showing the need for improvement:

Cain’s very positive image is offset by his lower name recognition, though he has become better known in recent weeks, with 55% of Republicans now familiar with him. He still trails the five best-known candidates — Bachmann, Gingrich, Perry, Romney, and Paul, all near 80% recognition. Santorum (54%) and Huntsman (43%) are less well-known.

That’s why the book tour is such a dumb idea (/sarcasm).

AP Headline, in Wake of Coptic Christian Killings: ‘Christians Under Siege’; Brotherhood-Salafi Alliance Ignored

Only at the self-described “Essential Global New Network” could the Sunday deaths in Egypt of 26 people, mostly Coptic Christians, be kept out of a story’s headline and their mention deferred until the third paragraph.

But that’s what readers will see in the four-paragraph grab which follows from a much longer item by the Associated Press’s Maggie Michael yesterday:


The headline might as well be: “You really don’t want to look at this; it’s thousands of miles away, and it’s boring. Don’t you want to read about those wonderful Occupy Wall Street folks?”


IBD on Eric Holder as Steve Urkel

Filed under: 2nd Amendment,National Security,Taxes & Government — Tom @ 8:40 am

Except that it’s not funny, given that hundreds of people have died, including Border Patrol agent Brian Terry.


It may be that I’ve missed it, but it seems that in addition to a media reluctance to cover the scandal, there’s been a related reluctance to show pictures of Terry. The graphic above, obtained from here, puts a face on the developing horror.

A Monday evening editorial at Investor’s Business Daily lays out the latest in the deadly Fast and Furious scandal (bolds are mine):

Fast And Furious And Ugly

The attorney general once again pleads ignorance as some 40 Fast and Furious weapons are found at a Mexican drug lord’s home. If the AG doesn’t read memos, maybe he can read a subpoena.

After Eric Holder was involved in the pardoning of international fugitive Marc Rich, he confessed to not doing a thorough check of Rich’s history and background. When he criticized Arizona’s immigration law, SB1070, he admitted to not even reading the law. Now, with dead bodies and illegal weapons piled up high in Fast and Furious, Holder says he didn’t read the memos.

Holder’s “Sgt. Schultz” defense that he knew, saw and heard nothing about the ATF’s gun-running operation does not wash with the chairman of the House Oversight Committee, Rep. Darrell Issa.

… We assume Holder reads the morning paper and has heard of the 40 assault weapons illegally purchased under the Phoenix ATF’s Fast and Furious operation that somehow wound up in the home of Sinaloa cartel enforcer Torres “the Jaguar” Marrufo. If he has, we suspect his reaction might have been akin to that of another famous sitcom character, Steve Urkel: “Did I do that?”

This is no sitcom, but rather a major tragedy — and a major crime. Marrufo is the enforcer for Sinaloa Cartel chieftain Joaquin “Chapo” Guzman. Border Patrol Agent Brian Terry was killed at the hands of an illegal immigrant working for the Sinaloa cartel just 10 miles from the Mexico border near Nogales, Ariz.

… Just who is ultimately responsible for this officially sanctioned weapons trafficking and Agent Terry’s murder is what Issa, who plans to subpoena Holder, wants to find out. “If, in fact, a border patrol agent has been murdered, 2,000 weapons have gone, this program has completely gone off the rails, why didn’t he know?”

Either Holder is the most aloof attorney general in American history or the most incompetent — or worse. Shortly after Holder sent his combative letter to Congress, 10 Arizona sheriffs, led by National Sheriff of the Year Paul Babeu, currently president of the Arizona Sheriffs Association, called for a Special Counsel to determine who should be held criminally accountable for Fast and Furious.

We need to get at the truth of who is ultimately culpable in arming Mexican drug cartels and in the death of Brian Terry. …

This would appear to be the last thing of interest to this administration.

Tuesday Off-Topic (Moderated) Open Thread (101111)

Filed under: Lucid Links — Tom @ 8:04 am

Rules are here. Possible comment fodder follows. Other topics are also fair game.


At NewsBusters: “Diane Sawyer Claims Wall Street Protests Have ‘Spread to More Than a Thousand Countries’” — Uh, the world has fewer than 200 countries.

In an Investor’s Business Daily editorial (“Fannie, Freddie Threaten Taxpayers Again”): “Now, looking at a federal debt growing by nearly $1.5 trillion a year, many of the same foreign investors who fueled our housing boom are wondering if they’ll ever get their money back.”

Priorities (“Defense-cut projections seen as risk to recruitment”): “… analysts warn that projected defense cuts of $1 trillion over 10 years would force the Pentagon to curtail such inducements, which would weaken its ability to attract sufficient high-quality personnel for the 2.2-million-strong active and reserve force.” Let’s not forget that John Boehner and Mitch McConnell acquiesced to this.

Joe the Plumber is running for Congress against Marcy “$3.5 Billion-Dollar Green Slush Fund” Kaptur.

At RedState: “Occupy Boston, the Boston branch of the Occupy Party, hosted a rally yesterday supporting accused terrorist Terak Mehanna.”

At Powerline (HT Hot Air, which asks a question which doesn’t seen to need a question mark — “Political party paying Occupy Wall Street protesters?”) — “… the Working Families Party (is) looking to hire protesters for Wall Street and offering $350-650 a week, depending on responsibility and length of time on staff.”

26 Coptic Christians killed; AP writesplease don’t read past this headline” headline” — “Christians under siege in post-revolution Egypt” — and waits until Paragraph 3 to note that killings have occurred.

This Isn’t ‘Lending’; It’s More Like Looting

Filed under: Business Moves,Economy,Taxes & Government — Tom @ 7:59 am

ObamaLootingThumbnailSolyndra’s unlearned lessons.


Note: This column went up at Pajamas Media and was teased here at BizzyBlog on Sunday.


One of the definitions of “loot” as a verb is: “to rob, as by burglary or corrupt activity in public office.”

Excuse the pun, but as bankrupt Solyndra Corporation sinks into the sunset, two levels of needed lesson-learning to prevent future looting as just defined are not taking place.

The first lesson should be that there are consequences if you do something extraordinarily dumb, and even more serious consequences if you commit criminal acts. I’d like to be wrong about this, but it looks like those responsible for this debacle will never be brought to account for offenses ranging from colossal incompetence to serious criminal malfeasance. Because of this, it’s reasonable to expect that there will be similar future failures, possibly larger in scope.

That Solyndra requires a top-to-bottom forensic audit could not be more clear, both to determine what its executives knew and when they knew it concerning the company’s dreadfully obvious lack of viability, and to determine how much money was drained from it by excessive and possibly fraud-driven spending.

Is the necessary unfettered investigation occurring? The FBI has raided the place, but Solyndra management is stonewalling. With government acquiescence, Solyndra’s key investors moved themselves, possibly illegally, to the front of the line in priority during bankruptcy. One of those investors is a prominent Democratic Party campaign contributions bundler. Eric Holder, Obama’s chief protector, is Attorney General. You do the math.

The guess here is that Solyndra’s execs knew that the company had little if any chance of surviving shortly after and possibly even before it began drawing down its loan-guarantee money. Yet they kept drawing and drawing. Why? The explanation seems to go far beyond merely wishing to keep themselves and others employed.

Fundamentally, the company’s business model was terminally flawed. It would have been an embarrassment both to the company and the Obama administration to admit as much. As Grace Wyler at Business Insider explains:

Its unique cylindrical, silicon solar cells were innovative, but only made sense when solar panel prices were high. By the time the Department of Energy (DOE) approved Solyndra’s loan — the first granted by the department’s loan guarantee program — Chinese and Canadian manufacturers with low-cost structures had priced Solyndra out of the market.

Solyndra’s management had to know this. Even if they didn’t tell those in the government who reviewed its loan-guarantee application (and of course they should have), anything resembling decent due diligence should have identified the problem. But, as Wyler notes, due diligence wasn’t a priority: In March 2009, “Solyndra’s loan application … was fast-tracked through the DOE, despite the fact that the department had not completed its review of the company’s financial viability.” The folks at the Office of Management and Budget, which did raise some financial questions about the deal before approving it in September 2009 — after also getting pressure from others in the White House to speed it along — likely did not have the technical or market knowledge to know what DOE could have and should have detected.

Solyndra’s spending spigots were wide open even before the company got its government-guaranteed money. The firm’s S-1 Registration Statement for its withdrawn attempt at an initial public offering, which included the now-infamous “going concern” opinion from Price Waterhouse Coopers, revealed that it had already spent $415 million on property, plant, and equipment by the end of 2009. From the time its $535 million in loan guarantees was approved until it shut its doors, the company spent roughly $300 million more on what was touted as an advanced manufacturing facility; it had hoped to spend $80 million more before repeatedly selling its product at an out-of-pocket loss caused the money well to run dry. All told, the company “invested” over $700 million to make a high-tech yet relatively uncomplicated product: “photovoltaic systems for commercial rooftops.” By comparison, Honda Manufacturing of North America built a complete 1,700-acre automobile assembly plant in Greensburg, Indiana for $550 million.

As I wrote in September, “[S]omeone needs to look into the pricing of that equipment, who the seller or sellers were, and whether the items involved were purchased in arm’s-length transactions.” The outsized amounts involved appear to betray a strong likelihood of self-dealing and kickbacks. Since the company had a calendar year-end for financial reporting, this problem would especially apply to transactions completed this year.

The second and far more fundamental lesson is that start-up and early-stage deals like Solyndra should not be financed with loans in the first place — and wouldn’t be financed that way without the federal government’s guarantee of such loans.

While a popular joke has long held that a bank will only lend you money if you don’t need it, the truth is that a bank should only lend you money if it’s supremely confident that you will be able to pay them back. Banks don’t take ownership interests in the businesses to which they lend. They instead allow businesses to rent money, and earn interest as their return. In a market free of government intervention, banks wouldn’t rent their money to start-up businesses — not because they’re hostile to them, but because their business model has almost no room for borrower failure.

A significant percentage of start-up businesses fail in a relatively short time. Guidance shown here indicates that half fail within five years, and 70% do so within ten — and the period studied (1992-2002) was relatively prosperous. In an intervention-free market, a deserving start-up or early-stage business requiring significant amounts of capital obtains it from investors who end up taking an ownership interest, often a controlling one. It often takes multiple rounds of investment before a company reaches self-sufficiency. Investors in these enterprises, who usually make multiple bets while hoping that at least some of them will work out well, are fully aware of the risks and the high incidence of failure, and expect very high returns as compensation when they cash out, usually by selling the enterprise to someone else or going public.

Picking winners and losers in business is not the realm of government, and it’s not the realm of banks. To the extent that politically driven governments and unqualified banks are involved in such funding, society’s limited capital has been and continues to be seriously misallocated.

Even after solar company failures resulting in stunning taxpayer losses, politicians like Massachusetts Governor Deval Patrick and President Obama insist that they have no regrets. What they’re engaged in isn’t lending; as defined above, it more closely resembles looting. It apparently won’t stop until Patrick, Obama, and people who agree with them are driven from public office.

Positivity: 7 survive 20 hours at sea clinging to boat, cooler

Filed under: Positivity — Tom @ 5:57 am

From Marathon, Florida:

Oct 10, 10:17 PM EDT

Four hours into a family fishing trip, rough waves flipped a 22-foot boat off the Florida Keys, tossing eight people overboard. Seven of them, including a 4-year-old girl, survived by clinging to their capsized vessel and a small blue cooler for almost 20 hours, suffering exhaustion, jellyfish stings and hypothermia.

A 79-year-old woman, the matriarch of the group, was missing and presumed drowned.

“When the will to live kicks in, human beings can do amazing things,” Coast Guard Petty Officer Nick Ameen said. x

Those rescued were taken to a hospital with non-life-threatening injuries.

The family left Layton in the Middle Keys around 8 a.m. Saturday to fish in less-than-ideal conditions. It was raining, seas topped 7 feet and winds were whipping up to 38 mph. After they anchored 3 1/2 miles off the island chain, two waves hit suddenly, capsizing the vessel.

The women grabbed the girl and the 2 1/2-foot cooler. One of the men tried to rescue his mother, but she slipped through his grasp and disappeared into the water.

Almost immediately, the two groups – the three women and girl and three men – drifted apart.

Nearly a day later, they were rescued when a commercial fisherman spotted the men Sunday morning and alerted the Coast Guard, which found the women and the blue cooler several miles away in the warm waters. …

Go here for the rest of the story.

The Best News for Herman Cain …

Filed under: Taxes & Government — Tom @ 12:13 am

… isn’t his polling number at Gallup, though it’s obviously quite strong and its direction quite dramatic:


No, the best news is the number at the bottom right showing that the undecideds have gone from 10% to 20% since the last poll 2-1/2 weeks ago. That’s not supposed to happen at this stage of the contest, especially when no one has dropped out.

This has to mean that a lot of people who thought they had made up their minds are now reevaluating. They know who Romney is; I don’t see how he gets above 25% if the field remains intact. They’re souring on Perry. They’re drifting from Paul; the idea that he’s getting intensely bent out of shape over killing a terrorist who is supposedly a “citizen” is likely a factor.

That 20% undecided is mostly Cain’s to win. Shoot, a good portion of that 20% still probably don’t know who he is. All he has to do is keep doing what he’s been doing, which is being himself, and working hard on visibility, which is why the book and radio/TV appearance strategy so many have ridiculed and have tried to portray as “not campaigning” looks awfully smart.