Wednesday, December 29, 2010

How Not to Help Blacks Find Employment (American Thinker)

 

By Robert Weissberg

As of November 2010, the overall unemployment rate for whites was 9.2%, but for African Americans it was 16.0%. Among those aged 16 to 19, the difference (including both males and females) was significantly larger -- 20.9% for young whites versus 46.5% for young blacks.  In job rich Manhattan, only one in four young (16-24) black males was employed in 2010. What is especially remarkable about these statistics is their intractability.  Since the 1960s and the War on Poverty, Washington has spent billions, everything from job training programs, to tax incentives,  to anti-discrimination laws to eradicate this gap, all to no avail.

Given a half century of failure, efforts to narrow differences have grown increasingly desperate. The latest is the federal government's attempt to equalize how black and white job candidates appear to prospective employers even if they differ substantially -- just ban employers from checking credit and criminal histories so as not to "unreasonably" disadvantage black job applicants.

The facts are straightforward. First, African Americans are far more likely to have criminal records than whites and, according to a Federal Reserve report, disproportionally also have credit problems -- repossessions, bankruptcies, wage garnishments, outstanding unsatisfied court judgments and high over-due credit card balances. Second, the internet (and other technologies) facilitates quick, inexpensive background checks of prospective employees (for example, here). Third, the courts have held that an employer screening of job applicants is inherently racially discriminatory if blacks are disproportionally excluded according to criteria that lack direct connections to the jobs (the principle of disparate impact).

Advocates of prohibiting this inquiry typically insist that (a) criminal and financial records are error prone, sometimes out-dated and often do not distinguish between serious and trivial infractions; (b) may reflect legal encounters decades back, often just youthful foolishness and (c) past bad behavior often has nothing to do with the sought after job. This view is graining traction beyond the federal government's long-standing campaign against disparate impact. Several states have explicitly banned employers from using credit histories in employment screening and a law was recently introduced (H.R. 3149) that would severely limit this practice nationally.

This anti-background check effort recently drew national attention when the Equal Employment Opportunity Commission (EEOC) sued the Kaplan Higher Education Corporation  for using credit histories to screen applicants, a widespread and growing practice among both private firms and the government itself. According to the suit, since January 2008 Kaplan has examined applicant credit histories and blacks have been disproportionately rejected. The EEOC not only demands that Kaplan cease this harmful practice but award back wages and benefits to those African Americans not hired due to credit troubles. Kaplan's defense is that it already has a diverse workforce, is an equal opportunity employer, and credit worthiness is relevant since Kaplan employees often handle financial matters.

Given the enduring gap between whites and blacks in obtaining jobs, the obvious question is whether this new approach will help African Americans get more jobs. Probably not; and, as in so many other well-intentioned interventions, it will widen gaps.

An almost prima facie case exists that criminal records and a poor credit rating tell a lot about a perspective employee, even for menial work. Past troubles provide clues about avoiding unwise risk, a capacity to plan, a willingness to follow rules, and otherwise behave prudently. These traits may have little to do with specific duties but no employer wants a workforce of deadbeats and former felons. Yes, there may be a weak link between failure to pay one's credit card on time and sticky fingers when sweeping the store floor at midnight without supervision, but there may be a connection, and given multiple applicants for the floor sweeper position, why risk pilfering? And, even if the initial job is unrelated to past problems, what happens when this employee asks for a promotion where the shaky background is relevant? Denying this request only invites litigation.

That these hiring criteria are racially discriminatory does not mean that they are economically irrational. Especially since good-paying jobs typically attract numerous applicants (especially in hard economic times), poor credit or a criminal conviction are perfect tie-breakers to sort out applicants. There are also supervision costs associated with monitoring employees with troubled backgrounds.  I owned a retail business for thirteen years, and this included hiring (and firing) dozens of employees, and predicting who will be an unsatisfactory employee, especially a thief, is difficult enough without knowing their personal histories, a situation compounded by many past employers refusing to say anything bad for fear of litigation. Given the paucity of information, I relied on the easily available applicant's history of paying utility bills, since I discovered that chronic no-payers often skipped work to resolve these crises. Nor did I trust those whose daily finances were desperate. To prohibit background checks is just one more attack on business.

Ironically, banning background checks may exacerbate black unemployment. If an employer has inadequate information about a prospective hire, he or she is forced to use crude proxies, and race is a convenient clear-cut proxy. So rather than risk hiring an ex-felon or chronic deadbeats, stick to whites or Asians. In fact, one study of this relationship found that employers were more likely to hire black males where they could perform background checks on past criminality. In other words, since most blacks have clean records, these "helpful" prohibitions were a liability for those who might otherwise be hired.

This ill-advised "help" is just one of many similar unhelpful government interventions. Prohibiting background checks only adds to an already heavy employer burden whose unintended impact is to price many blacks out of the job market. After all, what employer wants employees who can so easily sue for discrimination, real or imagined, on so many grounds (see here)? Similarly, why hire somebody whose educational credentials are less than bona fide thanks to government pressure on schools to make-the-number or admit unqualified applicants so as to redress historical inequalities?  And then prohibit the employer from independently testing job applicants if whites are likely to out-score blacks despite comparable credentials? Or why hire somebody who has been endlessly instructed that America is hopelessly racist and this racism must be exposed? No wonder that, as the private employment grows more competitive and employers have better choices, government itself has increasingly become the chief employer of blacks, since it lacks rivals with a superior workforce (see here, for example).

What might explain this counter-productive assistance? A cynic might claim that the hidden goal is greater dependency on government, but I'll leave that devious possibility to others. Personally I suspect that many "friends" of unemployed blacks lack any understanding how businesses can escape these economically harmful edicts.  In their mistaken view, help is just a matter of upping the pressure on white employers.  Yet, faced with edicts to hire blacks they are loath to hire, a firm might re-locate to largely whites areas, increase automation, hire sub-contractors immune to government mandates, eliminate or sell portions of the business, hire off-the-books and pay in cash, or outsource tasks overseas. These actions are, of course, increasingly commonplace, perfectly legal, and each may well contribute to the intractability of black unemployment.

Unfortunately, champions of boosting black employment refuse to acknowledge these avoidance strategies. They remain stuck in the white prejudice explanation and ignore the sound reasons behind these dreadful unemployment figures (see here). So, rather than counsel blacks how to use credit prudently, these "friends" attempt to create a fantasy world where employers cannot check troubled credit histories. But as the statistics show, the sham doesn't work. To invoke the mother of all clich├ęs, with friends like this, who needs enemies?

Page Printed from: http://www.americanthinker.com/2010/12/how_not_to_help_blacks_find_em.html at December 29, 2010 - 06:49:53 AM CST

Monday, December 27, 2010

Obama Has Lost The World

 

Written by: Daniel Greenfield

 

After the 2010 elections, it’s not exactly news that Obama has lost America. But in a less public referendum, he also lost the world. Obama’s cocktail party tour of the world’s capitals may look impressive on a map, but is irrelevant on a policy level. In less than two years, the White House has gone from being the center of world leadership to being irrelevant, from protecting world freedom to serving as a global party planning committee.

Even the Bush Administration’s harshest critics could never have credibly claimed that George W. Bush was irrelevant. He might have been hated, pilloried and shouted about– but he couldn’t be ignored. However Obama can be safely ignored. Invited to parties, given the chance to show off his cosmopolitan sophisticated by reciting one or two words in the local lingo, read off a teleprompter, along with some cant about the need for everyone to pull together and make the world a better place, and then dismissed for the rest of the evening.

As a world leader, he makes a passable party guest. He has a broad smile, brings along his own gifts and is famous in the way that celebrities, rather than prime ministers and presidents are famous. On an invitation list, he is more Bono than Sarkozy, Leonardo DiCaprio not Putin. You don’t invite him to talk turkey, not even on Thanksgiving. He’s just one of those famous people with a passing interest in politics who gets good media attention, but who has nothing worthwhile to say.

The only countries who take Obama seriously, are the ones who have to. The leaders of Great Britain, Israel and Japan– who have tied their countries to an enduring alliance with America based on mutual interests and values, only to discover that the latest fellow to sit behind the Oval Office desk no longer shares those values and couldn’t give less of a damn about American interests. It’s no wonder that European leaders ignore him as much as possible. Or that Netanyahu visited America, while Obama was abroad. Or that Japanese politics have become dangerously unstable.

On the enemy side, the growing aggressiveness of China, North Korea, Iran, Hezbollah and Al Qaeda can all be attributed to the global consensus that no one is at home in the White House.And if no one is at home in the White House, then that’s a perfect time to slap the big boy around the yard. China is doing it economically, the rest are doing it militarily. They’re all on board with Obama’s Post-American vision of the world. But unlike him and most liberals, they have a clear understanding of what that means. The America of some years back, which actually intimidated Libyan dictator Khaddafi into giving up his nuclear program, without lifting a hand against him is long gone. So is the Cedar Revolution. Syria and Iran are back in charge in Lebanon. And in Afghanistan, the Taliban are laughing at our soft power outreach efforts.

Obama’s soft power approach emphasizes the ‘soft’ and forgets the ‘power’. It neglects even Clinton era understandings about the role of America in the world, and reverts instead to a Carter era sense of guilt that bleeds into hostility toward American interests and allies. While the rest of the world puts their own interests first, they act like a cog in some imaginary global community, turning and turning toward the distant horizon of international brotherhood. While China, Russia and most of the world walk down their backs and up their jellyfish spines, laughing all the way. And America’s allies gird themselves and prepare for the worst.

From the first, this administration has curried favor with America’s enemies by betraying and humiliating its allies. But these hideous acts of moral cowardice have not won Obama the approval of America’s enemies. Only their contempt. And a Nobel Peace Prize from a committee of elderly left wing Swedes, awarded not for any accomplishment, but for the lack thereof. For being a man without a country, a leader without a spine and a representative of America who gives no thought for the interests of that country.

Now that the Koreas stand on the brink of war, Iran continues its drive toward a nuclear bomb, Al Qaeda is going global, Hezbollah is on the verge of taking Lebanon and Mexico is on the verge of imploding– the impact of America’s absence on the global stage is all too clear. The countless cocktail parties and toasts have not changed the world. All they’ve done is highlighted the transition of the White House from world leadership to global party guest. Trip after trip has ended in photo ops and policy failures. Instead Obama is stuck dumpster diving into the futile quest for a Palestinian state, not because such an entity will make the world any better, but because it will make him look good.

Obama has no mandate at home, and he has even less of one abroad. America’s enemies do not fear him. Only our allies do. Kim Jong Il does not sit up nights worrying what Obama will do. Because the consensus in North Korea, Iran and the rest of the world is that the sea will rise, the sun will set and Obama will do nothing. Except maybe write a strongly worded letter, offset by some quiet backchannel diplomacy from his coterie of international left wing stooges reassuring the offender that, “No, Barry really isn’t mad at you. He’s just concerned. Really, really concerned.”

Liberal pundits mock the rough and ready style of conservatives like Reagan, Bush or Palin in world affairs, but what they fail to realize is that the over-educated naivete, trendy cosmopolitanism and buzzword rich approach of a Kerry or Obama come off as laughably pathetic on the world stage. Republicans might be hated, but they can’t be ignored. Democrats on the other hand are catspaws and pawns, fools who are so sure of their cleverness and determined to embrace every culture in the way that only the graduates of Ivy League institutions can, that any Third World vendor could twirl them around his fingers.

World leaders are rarely liked, but effective ones are respected. And effective world leaders don’t lead with appeasement, don’t compromise before the other side has even made an offer and negotiate on behalf of their country, rather than some intangible global consensus. They understand that they represent a country, not a popularity contest. They don’t travel abroad to be adored or be greeted with parades and gifts, but to achieve tangible results on specific issues. To do otherwise is not to be a world leader, but a celebrity who happens to have picked up a big title along the way.

To be a proper American president on the world stage, means choosing to be respected, rather than liked. Obama always chooses to be liked, rather than respected. Because respect comes from accomplishment and character, while ‘liking’ is a function of appearance and image. Aiming to be ‘liked’ is playing to Obama’s strengths. But being liked is irrelevant outside of an afterschool special. World affairs is not a networking seminar, it is a negotiation between countries who have billions of dollars and millions of lives on the line. And Obama has no idea how to play that game. Like the kid who never fit in anywhere, he’s still trying to be liked. And he’s willing to sell out American interests and allies to get the cool UN kids to like him.

Unfortunately Obama’s irrelevance is also America’s irrelevance. A Republican House of Representatives cannot do what Obama should be doing. And any attempt to show strength gets shouted down by the liberal punditocracy as treason and undermining the White House. As if anyone, anywhere could undermine Obama internationally as much as he undermines himself. The same liberals who considered Ted Kennedy’s treasonous offer of cooperation with the Soviet Union or Kerry’s trip to Latin American Marxist terrorists to be acts of courage, damn Republicans who supported allies in Ecuador and Israel as traitors. And so Obama must have a free hand to do it all on his own. To do what Kennedy or Kerry could have only dreamed of.

Obama has lost the world. He has made the country that he claims to represent into a shadow of its former strength and glory. And his irrelevance endangers American lives. Not just those of soldiers in war zones, laboring under restrictive Rules of Engagement, written so as not to offend Muslims. Not just those of Americans at risk for domestic terrorism under an Attorney General who sympathizes with terrorists, more than with Americans. But to everyone living in a world where countries like North Korea and Iran feel free to do what they want, where our economic rivals such as Russia and China advance their interests and their espionage, and where terrorists across the Muslim world grow in boldness and number because they have no one left to fear anymore. In America and around the world– Barack Hussein Obama endangers us all.

About the author:

Daniel Greenfield

Daniel Greenfield is a columnist born in Israel and currently living in New York City. He is a contributing editor at Family Security Matters and writes a daily blog column on Islamic Terrorism, Israeli and American politics and Europe's own clash of civilizations which can be found at Sultanknish.blogspot.com.

The Winner of This Year's 'Best Climate Predictor' Award (Clue: It Wasn't Al Gore!) (American Thinker)

December 27, 2010

 

By Howard Richman & Raymond Richman

Given the terrible beginning of winter in the U.S. and Europe this year, we ought to reward those who accurately predicted it and condemn those who got it wrong.  It's time to choose the winner of this year's "Best Climate Predictor" award.  There are five nominees:

  1. former Vice President Al Gore,
  2. California Governor Arnold Schwarzenegger, 
  3. the IPCC of the United Nations, and
  4. British astrophysicist Piers Corbyn.  (You say you've never heard of him?  You won't be surprised, once you've read his predictions, that the media have ignored him.)

Gore, Schwarzenegger, and the IPCC made their mark through their dramatic predictions of catastrophic sea level rise due to increased carbon dioxide in the atmosphere causing global warming.  Gore once predicted that sea levels would rise by twenty feet over the century.  Last year, Schwarzenegger unveiled a map showing world sea levels rising by 1.5 meters over the next century.  In 2001, the IPCC predicted that sea level would rise by three feet over the next century.  Their past predictions and the accurate satellite measurements are shown in the chart below:

The actual sea level rise over the last eighteen years is 1.85 inches, which works out to 10.4 inches per century.  This is similar to the 20th century's rise of 8 inches, but much less than the average rise of 4 feet per century for the last 10,000 years as glaciers left by the last ice age continue to melt.

Gore's prediction is clearly the worst of these three, yet he was awarded a million-dollar Nobel Peace Prize for bringing this issue to the attention of the world.  Schwarzenegger's prediction comes in second-worst, yet he is angling for a global warming spokesman job in the Obama administration.  The IPCC's prediction is third-worst, yet it just won a huge expansion of the U.N. bureaucracy at the Cancun Climate Conference. 

Piers Corbyn is the clear winner, yet he still works out of a drab office that the U.K. Daily Telegraph calls "undistinguished":

[T]his is the third tough winter in a row. Is it really true that no one saw this coming?

Actually, they did. Allow me to introduce readers to Piers Corbyn, meteorologist and brother of my old chum, bearded leftie MP Jeremy. Piers Corbyn works in an undistinguished office in Borough High Street. He has no telescope or supercomputer. Armed only with a laptop, huge quantities of publicly available data and a first-class degree in astrophysics, he gets it right again and again.

Back in November, when the Met Office was still doing its "mild winter" schtick, Corbyn said it would be the coldest for 100 years. Indeed, it was back in May that he first predicted a snowy December, and he put his own money on a white Christmas about a month before the Met Office made any such forecast. He said that the Met Office would be wrong about last year's mythical "barbecue summer", and he was vindicated. He was closer to the truth about last winter, too. [...]

He seems to get it right about 85 per cent of the time and serious business people - notably in farming - are starting to invest in his forecasts. In the eyes of many punters, he puts the taxpayer-funded Met Office to shame. How on earth does he do it? He studies the Sun.

Corbyn, like many other astrophysicists, has figured out that climate change is mainly due to extraterrestrial forces, including solar activity and cosmic rays, not carbon dioxide.  If you still believe in the theory that carbon dioxide causes climate change, click here to watch an excellent lecture by Jasper Kirkby at the Cern, one of Europe's most highly respected centers for scientific research.  Astrophysicists have discovered that changes in the rate of cosmic ray inflow cause climate change and that solar activity shields the earth from cosmic rays.  They haven't completely worked out the mechanism yet, but they think it has to do with cosmic rays causing cloud formation and clouds reflecting sunlight back into space.

Who says that climate change will not be catastrophic?  Starting January 2, President Obama's EPA will start enforcing its new regulation that American industries use the "best available control technologies" to reduce carbon dioxide emissions.  This could increase American energy costs sufficiently to choke off our economic recovery.

And don't forget that at the conclusion of last year's climate conference in Copenhagen, President Obama negotiated the Copenhagen Accord with China, Brazil, South Africa, and India as a framework for future negotiations.  That accord lets China opt out from any verifiable requirements but commits the developed nations to paying out $100 billion per year to the U.N. and to the participating developing countries.  It states:

In the context of meaningful mitigation actions and transparency on implementation, developed countries commit to a goal of mobilizing jointly USD 100 billion dollars a year by 2020 to address the needs of developing countries. This funding will come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources of finance. New multilateral funding for adaptation will be delivered through effective and efficient fund arrangements, with a governance structure providing for equal representation of developed and developing countries. A significant portion of such funding should flow through the Copenhagen Green Climate Fund.

So who is the best climate predictor of the year?  Obviously, that honor goes to Piers Corbyn and his fellow astrophysicists.  Who is the worst?  Al Gore, followed closely by Gov. Schwarzenegger and the U.N.'s IPCC.  The last entrant's mischief-making has already cost the U.S. billion of dollars and brought Spain to the edge of bankruptcy, and it promises to make China the principal beneficiary of any further action.  President Obama and the U.S. Environmental Protection Agency appear determined to bankrupt the U.S. and send what remains of U.S. manufacturing to China.

The authors maintain a blog at www.idealtaxes.com, and co-authored the 2008 book Trading Away Our Future: How to Fix Our Government-Driven Trade Deficits and Faulty Tax System Before it's Too Late, published by Ideal Taxes Association.

Page Printed from: http://www.americanthinker.com/2010/12/the_winner_of_this_years_best.html at December 27, 2010 - 07:55:25 AM CST

Wednesday, December 22, 2010

Seeds of Financial Catastrophe (American Thinker)

December 22, 2010

 

By Fred N. Sauer

Although our economy is still struggling to recover from what is now the longest recession since the Great Depression, the latter was a much greater catastrophe.  From 1929-1939, unemployment reached as high as 25%, industrial production dropped 46%, wholesale prices fell 32% and foreign trade dropped 70%. 

There is a general consensus about one of the most significant contributing factors to the financial crisis of the Great Depression:

In the nineteenth and early twentieth centuries, bankers and brokers were sometimes indistinguishable.  Then, in the Great Depression after 1929, Congress examined the mixing of the ‘commercial' and ‘investment' banking industries that occurred in the 1920s.  Hearings revealed conflicts of interest and fraud in some banking institutions' securities activities.

Commercial Banks for the most part are lenders to persons and businesses whose borrowing requirements are too small to utilize public markets.  Commercial Banks have to have detailed personal knowledge of their borrowers.  And they lend to local borrowers in their local communities. 

Investment Banks, on the other hand, tend to raise money for larger businesses from the sale of common and preferred stocks and longer term corporate debt.  The criteria for borrowing in the public markets are more rigorous than those of local bank lending.  Therefore, it is much more expensive and complicated to qualify for this type of lending.  Investment Banks also tend to make markets in the securities they issue or those that are already outstanding in the public market.  This is all done by brokerages, the buyers and sellers of public securities for private and institutional investors.  

To remedy these problems, Congress passed a historic piece of legislation:

The second Glass-Steagall Act (the Banking Act of 1933) was a reaction to the collapse of a large portion of the American commercial banking system in early 1933.  It introduced the separation of bank types according to their business (commercial and investment banking), and it founded the Federal Deposit Insurance Corporation for insuring bank deposits.

The most important part of the Act was the creation of the Federal Deposit Insurance Corporation (FDIC).  This insured deposits placed in commercial banks from the risk of loss in the event of the failure of a commercial bank.  Depositors are in effect "lenders" to banks which relend the deposits to other borrowers.  In the absence of such insurance, when the banking system started to collapse in 1933, depositors' funds were wiped out.  And so, the money supply shrank considerably. 

In separating commercial banks from investment banks, Federal Deposit Insurance was not provided to investment banks, and for what used to be obvious reasons, commercial banks are considered less risky businesses than investment banks.  Therefore, all other things being equal, investment banks will always have to pay a higher rate of interest to borrow money than commercial banks have to pay their depositors. 

When you open up your bank statement, whatever the amount of your balance, about 60-80% of it has to be paid off with loans made to borrowers, while the rest is covered by required reserves and other sources of income.  Everyone with a positive balance on their bank statement is in fact an invisible partner to a business or individual who has borrowed money from the depositor's bank using the depositor's funds.  And as we said, bank loans historically have not been marketable because typical bank borrowers could not meet the market's qualifying criteria. 

And so, commercial banks used to be experts in knowing their customers, knowing their collateral and getting personal guarantees to provide their successful history of making unmarketable loans.  These then benefit the borrower, the depositors, and their stockholders.  And banks usually held these loans to maturity and everyone involved lived with the consequences. 

By 1970, something new popped up called Asset Securitization.  In this process, batches of similar loans are assembled so that they would look like a single larger loan with a composite of the individual loans' characteristics.  The larger loan could then be economically prepared for trading in public markets.  The Federal Government started to use this process to make mortgages for housing more affordable. 

In February 1970, the U.S. Department of Housing and Urban Development created the transaction using a mortgage-backed security.  The Government National Mortgage Association (GNMA or Ginnie Mae) sold securities backed by a portfolio of mortgage loans. 

In the case of Ginnie Mae securities, no matter what the quality of the individual mortgages in the pool amounted to, when the securities where combined into a single security issued by Ginnie Mae, their value was enhanced by the existence of the implied guarantee of the Federal Government (i.e., the United States taxpayer).  Through Ginnie Mae purchasing and securitizing pools of mortgages, banks could unload their portfolios of mortgages.  This would result in a further loss of accountability over the quality of the mortgages originated.  When Commercial Banks held mortgages to maturity, they were more careful about their quality.  In a short period of time, Asset Securitization allowed commercial banks to offload bad loans over which they otherwise had institutional responsibility to other investors and depositors. 

Not surprisingly, banks started pooling together other types of bank loans for securitization: 

...In 1985, securitization techniques that had been developed in the mortgage market were applied for the first time to a class of non-mortgage assets -- automobile loans.  A pool of assets second only to mortgages in volume, auto loans were a good match for structured finance; their maturities, considerably shorter than those of mortgages, made the timing of cash flows more predictable, and their long statistical histories of performance gave investors confidence... .

The first significant bank credit card sale came to market in 1986 with a private placement of $50 million of outstanding bank card loans... .  Sales of this type - with no contractual obligation by the seller to provide recourse - allowed banks to receive sales treatment for accounting and regulatory purposes (easing balance sheet and capital constraints), while at the same time allowing them to retain origination and servicing fees... .

The first public Securitization of Community Reinvestment Act (CRA) loans started in 1997.  CRA loans are loans targeted to low and moderate income borrowers and neighborhoods.  

These would become the fodder for the sub-prime mortgage debacle we just experienced.

Here is a short course on this Asset Securitization, and how it is attractive. Commercial Bank "A" has 1,000 individual mortgages.  There is no market for just one of them.  But there is a market for 1,000 securitized into a single security whose composite yield is 6.5% and composite duration is 20 years.  Investment Bank "B" knows that they can sell a $100,000 pool of securitized mortgages to a high yield mutual fund "C" for a yield of 4.5%.  Commercial Bank "A"'s $1,000,000 pool has a monthly cash flow, principal and interest of $7,455.74.  Investment Bank "B" knows that they can sell this pool of mortgages for a yield of 4.5%.  In order to induce Commercial Bank "A" to sell the pool to it, Investment Bank "B" offers to pay Commercial Bank "A" $1,083,860 and will then give the pool a yield of 5.5%.  Commercial Bank "A" makes a profit of $83,860.   When Investment Bank "B" resells the same pool to the high yield Mutual Fund "C", which only needs a yield of 4.5%, it receives $1,178,494 from the high yield Mutual Fund "C".  Therefore, Investment Bank "B" makes a profit of $94,634, and so on.  In addition to the initial profit, there are placement, distribution and administrative fees to be earned.  This is quicker money than holding mortgages to maturity. 

Chart 1-Value of 1,000,000 Pool of Mortgages

Accountability and responsibility declined as securitization increased with everyone earning fees on originating and issuing securitized pools of almost anything.  Both the commercial banks and investment banks love this environment.  They make a lot of fees and turn over their capital rapidly.  And each one of them wanted to get into each other's business.  Unfortunately for them, the Glass-Steagall Act stood in their way.  Then in 1995, everything started to change, under the leadership of a former Goldman Sachs CEO:

Robert E. Rubin, secretary of the Treasury, recommended that Congress pass legislation to reform or repeal the Glass-Steagall Act of 1933 to modernize the country's financial system.  In testimony before the House Committee on Banking and Financial Services, Rubin said Clinton administration proposals would permit affiliations between banks and other financial services companies, such as securities firms and insurance companies... .

...Rubin said supporters of the act today say Glass-Steagall is necessary to protect the federal deposit insurance system. 

‘However,' said Rubin, ‘the banking industry is fundamentally different from what it was two decades ago, let alone in 1933.'  He said the industry has been transformed into a global business of facilitating capital formation through diverse new products, services and markets.  ‘U.S. banks generally engage in a broader range of securities activities abroad than is permitted domestically,' said the Treasury secretary.  ‘Even domestically, the separation of investment banking and commercial banking envisioned by Glass-Steagall has eroded significantly.'

Rubin said Glass-Steagall imposed unnecessary costs and made providing financial services less efficient and more costly.  He said the act can ‘conceivably impede safety and soundness by limiting revenue diversification.' 

The recent financial crisis completely obliterated every intended meaning of this financial elite member's statement. The repeal of the Glass-Steagall Act allowed Citicorp and Travelers Insurance Company to merge in 1998.  This merger ignited a wave of other commercial banks absorbing investment banks.  The amount of government aid to these banks and financial institutions, including aid provided by the Treasury Department through TARP and the Federal Reserve, aggregated over $1 trillion through 2009.  This and the near-collapse of Citigroup, and several other major financial institutions, demonstrate the removal of the Glass-Steagall Act was a complete and utter catastrophe for America. Nonetheless, the recently passed Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 does not correct this
Fred N. Sauer is an American patriot, St. Louis resident, and businessman whose blog can be found at www.americasculturalstudies.com.

Page Printed from: http://www.americanthinker.com/2010/12/seeds_of_financial_catastrophe.html at December 22, 2010 - 06:57:44 AM CST

Wednesday, December 15, 2010

To Sexist AP, HuffPo Inanely Bashing Palin Is More Important Than Helping Haiti (Redstate.com)

 

Posted by Lori Ziganto (Profile)

Tuesday, December 14th at 11:30AM EST

136 Comments

Every time I think that the “Press” can’t sink any lower than the rock bottom they’ve already hit, they somehow manage to burrow themselves further into the earth’s mantle. As is so often the case, this most recent gutter-dwelling example has to do with Sarah Palin, who dared to go on a humanitarian trip to Haiti. This does not suit! You see, how can the Press feel all holier-than-thou and better than Sarah Palin – and her fellow rubes – when she is out helping people in Haiti, while they are sitting at home and sipping their soy lattes? I mean, you can’t even see their super awesome and caring “cause ribbons” in print. Plus, she’s just a girl and not the right kind of girl; she embraces motherhood and doesn’t hyphenate her name. She doesn’t even limit herself to caring only about topics that women are assigned to caring about by the left. This aggression cannot stand.

So, they fall back on sneering contempt, mixed with insanity and outright lies. While that is what they are best at, even that no longer works. A funny little thing happened to their ability to do so: the absolute moral  insolvency of the Fourth Estate is now apparent to most and citizens are now finding the truth for themselves. This again happened on Monday, when the AP ran this picture and caption:

“Former Alaska Gov. Sarah Palin, center, has her hair done during a visit to a cholera treatment center set up by the NGO Samaritan’s Purse in Cabaret, Haiti, Saturday, Dec. 11, 2010….”

What the AP photographer purposely neglects to mention is that the woman “doing Palin’s hair” is her daughter, Bristol. She is clearly seen in the following photograph, as also noted by Free Republic:

In other photos from Saturday, Todd and Sarah Palin’s white, brunette, eldest daughter Bristol, who accompanied her parents on the trip to Haiti, is wearing the exact same clothing and ponytail as the “hair stylist” in the AP photo.

That’s right, what the Palin-hating AP and others fail to report is that the “hair stylist” is Bristol Palin.

Bristol Palin was fixing a loose clip or an errant strand of hair for her mother. The photographer quite clearly knew that, having taken the picture and having actually looked through the lens at the people whose photo he was taking. He managed to identify Todd Palin, yet purposely did not identify Bristol.

There are a couple of things clearly on display here. Firstly, the oh-so-tolerant and loving Left is anything but. It’s far easier to mock and bash Sarah Palin than to actually, you know, do anything to help. Secondly, their blatant sexism, particularly against conservative women (femininity with smarts and strength is icky), has once again been exposed for all to see. I suppose we are to just be grateful that the media didn’t get all atwitter, contemplating boob jobs, like they did last time Palin was photographed in a t-shirt. The Daily Mail picked up on the “let’s totally lie to fit our delusional narrative” line with an article titled Ready for Her Close Up…Sarah Palin Lands in Haiti (where they don’t care what her hair looks like).

Michael Shaw at The Huffington Post went one further with one of the most dreck-filled “articles” I’ve read in a good while. And that’s saying something. I hesitate to quote too much of it, just to be safe, on the off-chance that cuckoo-pants may be catching. But, here are some highlights lowlights:

If I find the fantastically clever Sarah Palin to be one of the shallowest and blatantly self-serving politicians, err, political celebrities I’ve ever seen, it doesn’t stop me from taking pause upon seeing these AP shots from Franklin Graham’s cholera treatment center in Haiti.

Damn right it’s revolting seeing Sarah getting her hair made up like this field hospital is her movie set –

I’ll translate: Shallowest, self-serving and political celebrities – that’s all code for dares to be attractive and feminine.  In the mind of a leftist, women really shouldn’t be taken seriously. They are only tolerated if they allow themselves to be useful idiots and talk the leftist talk and walk the leftist walk. “Revolting seeing Sarah getting her hair made up” – this is also code for “she’s just a dumb broad.” However, it’s also a case of projection. What’s really revolting is that someone sitting on his fanny is mocking someone who is visiting and trying to bring aid and comfort to cholera patients at a field hospital.

Shaw then drifts into even more inane, and insane, territory. I know. But, it’s true:

And then, the multiple shots of Sarah sanitizing and washing her hands suggests the former Gov is primarily concerned, above all humanitarian else, about catching something.

There are two questions I can’t quite answer, however. 1.) Compassion notwithstanding, could these exact same images have been created if it was Biden, Bill Clinton, Hillary or Nancy Pelosi moving around this camp with media in tow over the same afternoon?

She’s concerned about “catching something”? She’s there. Where are you, Mr. Shaw? Furthermore, I’m no fancy-pants journalist who talks out of my cushy and judgmental hindquarters. So, I did a little something called a google search to confirm my common sense (common sense is hard for the Left) suspicions; washing and sanitizing hands after being in contact with people infected with cholera is a way to, you know, stop the transmission and spreading of cholera. It’s what one is supposed to do.

And I’ll answer your idiotic question, Mr. Shaw. No, those same images would not have been created, were it Biden or Bill Clinton. Nor even Barack Obama, if you could get him off the golf course long enough. And, even then, he’d probably just outsource to Bill Clinton again, anyway. No such images nor captions would be created because you’ll never see a caption purposely meant to diminish or demean, based on gender, underneath the photo of a male politician. A photo of Obama, say, having his tie fixed, would never say something  like “Barack Obama has wardrobe styling done during visit.”  And any pictures of Joe Biden having his hair fixed would be photos taken at the Hair Club for Men.

Plus, Sarah Palin is the one with the spine; Bill Clinton, in fact, canceled his planned trip to Haiti because it was too scary.

Shaw goes on to try to explain away the fact that the “hair stylist” in the picture was revealed to be Bristol by claiming that somehow shows media bias in favor of Palin. Or something. I’m not really sure, as I lost my cuckoo-pants to English dictionary.

In any event, keep lying and bashing, Mr. Shaw and your fellow travelers. Lie and bash like the wind.

It only makes Palin stronger. I’m sure the people of Haiti are taking comfort from that strength. I’m also certain that she, and all the others on this humanitarian trip at whom you sneer from the comfort of your own sanctimony, will do more in one day to aid others than you will do your entire life. See, people can’t really subsist on shiny, self-congratulatory “cause ribbons.”

Nor on Smug ™.

Sunday, December 12, 2010

Why Palin Makes Liberals Nuts

 

By weholdthesetruths

It's all about ego.

Well, ok, no it isn't. I just thought that little bolded lead-in would get your eyes open a slight bit wider. I don't know if it worked, and I don't care, I write to amuse me, not necessarily you (though if I do entertain, inform, inspire, anger, annoy, or otherwise prompt you to think, so much the better).

Never has American society been so divided - and it's not between the haves and have-nots, as much as it is between the self identified 'intelligent' and most everyone else. Oddly enough, we all live and work and eat and drive and shop and vacation in much the same places and ways and for the same things, but somehow, we've come to see it all different.

For generations, children grew up with an expectation, and even hopes, of being like their parents. In America of old, not only did they dream of it, but they did it, and they did BETTER than their parents. I think we expect it, and I don't think that's a bad thing. But somewhere, it seems to have gone awry. As knowledge has increased, children often have the chance to learn much more than the parents did. The universe of knowledge about science, biology, physics, and many other things has expanded in a way that makes the word "dramatically" seem pitifully weak, but for now, it stands.

And somewhere along the way, there became the inevitable, when children came to believe themselves wiser than than their parents. In the old days, when your ability to accomplish concrete things, like hunting, fishing, growing, building and so on, was the key to success in life, those children who failed to learn from parents often did poorly, as the knowledge needed came ONLY from the generations before. Children who ignored their parents were generally unsuccessful, and often attended the University of Hard Knocks before they wised up, and ended up emulating much of what their parents knew and taught.

But today, our financial success in life is not nearly so much dependent upon broad practical skills passed from generation to generation, it's more dependent upon learning some specialized skill and exploiting it for gain. You may think that's good or bad, and there's arguments for both, but either way, it's hard to argue differently. Parents taught frugality, but it seemed that even the non-frugal did ok. Parents taught to be patient and to restrain yourself and be prudent and all those other things, and yet, we saw the impatient and imprudent prosper.

And so questioning and often outright rejecting the mores and traditions of our parents became a generational pastime, one now entrenched and generations old. There are multiple versions of this... Political, meaning "progressive" and "conservative" and there's social versions as well, and financial versions and so on. It was a very progressive thing in 1778 to be against slavery, but today, conservatives are adamantly opposed to it. Meaning that issues or matters can move from one spectrum to other. But the moral case against slavery was just as true in the 1700's as it is today. This is a case of a truly conservative idea becoming so far outside of the publicly accepted, that it could be labelled "progressive". But the right and wrong never changed.

The Founders had a truly revolutionary idea, one we could probably reasonably appropriately label as "progressive", that government would serve, not rule, the citizens. One where the idea of a centralized government ordering the people around to please the whims of those who hold office was so foreign and so repugnant it would be codified into law as illegal. Truly, in that era, it was an idea that was far and away outside the "norm". But it was a truly great idea, one worthy of the ages.

It is a lot of generations from 1788 to now, and in that time, social change has brought us that same ever evolving generational change. Now it is "progressive" to want a government with the power to control every aspect of our lives, to limit people's income, wealth, economic activities, and control relationships between even employee and employer. And, to take economically from those not poltically favored, and give material or financial benefits to those politically favored by politicians.

The reason the US went to war with England, was over that kind of centrally directed economic control, forced upon us by the King. The colonies rebelled to escape such centralized powers.

But what we face, is that a few generations back, it was much harder to visibly discern the array of differences between us. Today, they are stark. Academics claim that morality is based upon political ideology, and supposedly great thinkers laud them for their innovative approach to complex problems. The Colonists rejected the King, precisely because the King claimed that what was moral and just was defined by what the King wanted. To those of us who hold other views, there is negligible difference between modern progressives and the kings of yore, for obvious reasons.

Conservatives look at economics in a very utilitarian way. Wealth is created by undertaking business ventures. Unlike the 1700's, growing food without large capital investment will not make you wealthy. It is impossible to actually survive in a subsistence mode today, the taxes alone will make you lose everything you have, and you'll be left without the means of even subsistence farming. Nothing any individual can do, without the interaction of, the conduct of economic trading and transaction - otherwise known as business, will generate enough wealth to provide our needs and wants. Everyone needs a job, and jobs are created by private enterprise. Very simple equation. Very fundamentally sound and time tested for many, many centuries.

As a conservative, I hold onto the things that are time tested and true. "Open marriage" is a bust. High risk debt is not secure. Deep debt is an entrapment. Big, controlling government is a massive burden too large to bear and still be individually prosperous. Poverty is bad. Dependency does bad things to people's thinking and will. None of these ideas require or even depend upon academic thinking or education to establish. They are simply the accumulated wisdom of the ages, about things that do not change.

But progressives do not accept these things. Not universally, of course. Progressives may be conservative about marriage, for instance, but be wholly radical about government. It's a free country, of course. But progressives, by and large, have come to despise the "old fashioned", and have instead, embraced the "new". And by "new", I mean the untested, the untried, the unproven. Or, at least not in the way they want to do them. They pride themselves in rejection of the old and staid and embracing the "smarter" and "better" "new" ideas that are better and smarter than the old and dull stuff my parents and maybe their parents or grandparents or maybe great grandparents thought was pretty solid and true.

Progressives have a burden to change everyone else to be like them. They embrace the new and innovative, they love "change", sometimes just for the sake of change. And they blame all the problems on the old ways of doing things. Which brings us to the intractable debate, the argument that expresses itself in the Sarah Palin divide.

Liberals, progressives, Democrats, whatever the self identity is that brings them to despise Palin, it's because she is the most visible source of antagonism. Unashamedly, with a smile, and sometimes with humor, she, without recognition of their superior intellectual status, tears them down, dismisses them without a second thought, and champions the ideas that they have so carefully spent time and energy attempting to discredit.

For decades, the arguments have mostly been limited to a few Republicans vs progressives. But political parties are soulless things, and so the GOP had drifted far their way, mostly giving into their relentless activisim. Politicans rarely stand too firmly on principle, and as such, are easily drifted with the tide. And the "tide" it is. Because progressives have sought with fervent ardor to become the teachers, the legislators, the journalists, the media, the entertainers, the ones who control the conversation. Progressivism isn't based upon logic and facts and reason, it's based upon a reflexive rejection of traditional things and an embrace of the new and exciting or even just "different", for sake of being "ahead" of the generations previous.

It can all be predicted, you know. The labelling as dumb - after all, she is so dumb, she doesn't acknowledge that progressivism is better. She doesn't know her ideas have lost, and thus champions them with a straight face and no reservations. She doesn't act like a product of an elite school, where "education" has become an indoctrination - perhaps even programming - into progressivism on every subject. Professors and administrators feel free to degrade those who fail to conform. Pundits on TV react with derision and insult toward those who don't conform.

There have been other targets, of course. Some we know still, some forgotten. Mostly because they folded under the withering barrage against them, or compromised, or found themselves silenced by efforts of those who wished to shut them up. But Palin's the exception. Palin has reached into the heartland, where progressivism isn't the standard of thinking. She speaks for the majority, in an unabashed, proud and self assured way. She is, to put it in crude terms, the massive boil on the face of a model.

And, so they get angry. Irritated, hateful, enraged, deranged, and whatever other terms fit the passionate and negative reaction to one who has so much popular support, who simply refuses in any way, to be cowed. Even more irritating, she turns their criticism and anger into additional public support and popularity. Progressives thought by making her the face of conservatism that they would marginalize it. Instead, it backfired. They attacked personally, the conservatives, by making Palin the proxy, and conservatives, for the first time, didn't roll over and die. Nor did Palin. Instead, the more they throw at her, the more she generates support for herself and the ideology attacked by proxy.

Liberals, progressives, whatever term you wish to use, are by definition, followers. They follow the ideas of some thinker, some writer, some figure. They have their icons, and thier 'wisdom' consists of the writings by and speeches from, and ideas from radicals from various generations. For them, history starts at their adulthood and they have the answer for all the vexations of humanity. It never occurs to them that far wiser have tried far harder than they have ever dreamed of. Our status as an incredibly prosperous country has provided the funding, the discretionary income and time, for them to experiment, mostly without consequence, on our people and country, and they are wholly taken back, that when a real crisis occurs, the people they thought were following them have been reluctantly tolerating them. And along comes someone like Palin, who represents every, and I mean EVERY thing they fight so hard against, and rides a wave of popularity to celebrity status.

Political critics of Palin say she's running a celebrity event. She's trying to be celebrity. Perhaps so. Analysts of Palin insist she can't run for President, because she's too caught up in being a media star. I think Palin has an instinctive grasp of things far better than she or most grasp. What more of a lightning rod could Palin be, than to subvert media and celebrity to campaign for conservatism? You could not possibly be more "in your face" than to use the very tools and venues of progressivism to promote conservatism. Conservatives were supposed to be mind numbed robots, remember, following Rush on AM radio. It was a nice, neatly packaged lie that progressives told themselves. Conservatives don't follow anyone... Except perhaps Jefferson and Washington and Jesus and other unknowns in today's media. They just assumed that conservatives followed, just as they follow.

Palin's not dumb. Not ignorant. She is the child of two passionate teachers. She knows more about biology and physics and math and history and geography and the list goes on, than the vast majority. She knows her place and our place in history. And she knows where we, Americans came from. And that exceptionally bright "city upon a hill" and "beacon of liberty" to the world. That's the kind of teaching that real teachers taught. It may be "ignorance" as defined by progressives. But it's the wisdom of age, time, and history.

And just when they believed the battle to overcome history and wisdom was won, along came the most unlikely hockey mom from a dusty and un-sophisticated town, in the most primitive state, championing the most unprogressive ideas, and in doing so, taking that victory and flushing it down the toilet. Instead, the TEA Party showed up. It's the worst nightmare of the intellectual, the elite, the progressives. Thank God. I thought for a while the darkness would win. We had forgotten that even a hockey mom from Wasilla can beat back the darkness. We fear it no more.

Saturday, December 11, 2010

Sarah Palin: America By Heart, A Review

 

Posted by Melissa Clouthier on Dec 5 2010

Over Thanksgiving, I read Sarah Palin’s new book, America by Heart : Reflections on Family, Faith, and Flag. My first thought after finishing it? Wow, that was good. My second thought? If someone gripes about her from now on, I’m going to respond,”Have you read her book?” When the opinionated person says, “No.” I’m going to say back, “Talk to me after you’ve read her book.”

Before getting to the guts of the tome, I would like to address one thing that irritates me: When writing about Sarah Palin, it is de rigeur for friend and foe alike to use one’s criticism (and I mean criticism in the dictionary sense; here is the definition: Criticism is the judgment of the merits and faults of the work or actions of one individual by another. To criticise does not necessarily imply to find fault, but the word is often taken to mean the simple expression of prejudice or disapproval) as either an endorsement or “hit job” of the person.

Even reading the book implies a certain fan-like behavior, a friend informed me. This notion is offensively absurd, but then, we live in absurd political times.

Here is what I believe about Sarah Palin: She is a political force of nature. She should be taken seriously. She has a tremendous amount of political capital and would be a contender if she chooses to run in 2012.

In addition, Palin has driven the political debate since President Obama has taken office. She, more than any other Republican, has been a philosophical counter-point to Barack Obama, and really, to the establishment Republicans in Washington, D.C.

Her book deserves to be read on all these grounds. And anyone who claims to be an intellectual but refuses to engage intellectually by refusing to read her book deserves to be ignored.

To the book.

You know how your mom told you that in polite company one does not discuss sex, politics and religion, and for good modern measure, race? Evidently, no one had that conversation with Governor Sarah Palin. Her book covers all the unspeakables and takes the issues on in her characteristically direct manor.

The tone of the book is refreshingly open. That is, she addresses many challenging and politically incorrect topics with alacrity. Her opinions will make many people angry, once they summon the gumption to read them. Her opinions will force other politicians to answer difficult questions, should the press have the gumption to ask them.

A sampling of quotes:

Parenting: Page 117: “When it comes to raising good citizens, all ‘lifestyle choices’ are not created equal.” Governor Palin notes this in the context of the Murphy Brown and Dan Quale debacle two decades ago.

Feminism: Page 135: ” In the name of liberating women, modern feminism has wrapped us in a one-size-fits-all strait jacked of political correctness.” And on Page 140: ” …somewhere along the line feminism went from being pro-woman to being effectively anti-woman.”

Abortion: quoting Alice Paul: Page 157: “Abortion is the ultimate exploitation of women.” Mary Vitale calls the book a “Pro-Life Family Story.

Self-esteem movement: Page 167: “Our basic understanding of self-discipline and our ability to work hard for an often distant reward are formed early, in strong families and communities that don’t confuse hard-earned self-esteem with unearned self-regard.” And on Page 179: “I believe in a humbler, less self-involved America.” And on page 166: “In fact, we may be creating a generation of entitled little whiners.”

Government: Page 75: “A ‘boundless field of power’ — sounds like it could be a description of the current flood of legislation coming out of Washington. What we’re seeing today is the inevitable result of national leaders who have forgotten the fundamental wisdom of the the Tenth Amendment.” And on Page 72: “In practice, I’ve always interpreted the Tenth Amendment to mean that the best government is government that is closest to the people.”

Freedom: Page 12: “For me, this is the essence of freedom: to be a child of God whose God-given rights and responsibilities are respected by her government under the Constitution.”

Slavery: Page 29: “[The Framers] did more than just kick the can down the road. They produced a document that one of the delegates at the Constitutional Convention, James Wilson, said succeeded in ‘laying the foundation for banishing slavery out of this country,’ even thought he regretted that ‘the period is more distant than I could wish.”

Hollywood portrayal of the military: Page 42: “What makes this reflexive anti-Americanism hardest to swallow is the fact that it is our troops–these men and women who are being portrayed as unwitting (and witting) agents of greed and evil on the big screen–who make the entertainment industry possible.”

Sarah Palin writes an ardent defense of John McCain and writes passionately about the military. She relates the embarrassment and difficulty of having a child who ended up pregnant as a teen. She tells some personal anecdotes while winding her philosophy about America through the threads.

Most of all, Sarah Palin proclaims her devotion to America and asserts its exceptional place in the world.

In short, America By Heart is the anti-Audacity of Hope.

Far from believing that America must be remade, she believes America must be renewed. She cites philosophers, thinkers, movie makers, politicians and historians. Far from sounding ignorant, she sounds well-read and informed. She lays out her beliefs in a clear and straight-forward manner. Far from being a dithering confused empty suit, she seems centered and sure.

If there was a weakness in the book, it was in the lack of concrete policy solutions, though I’m not sure that was the purpose of her book. At one point, she beautifully laid out the problem of the loss of the nuclear family and how it’s destroying the social fabric of society. She cites a lengthy piece from James Q. Wilson (page 119). Here’s a snippet:

“To avoid poverty, do three things: finish high school, marry before having a child, and produce the child after you are twenty years old. Only 8 percent of people who do all three will be poor; of those who fail to do them, 79 percent will be poor.”

Then Palin says (page 120):

“Two-parent families do matter when it comes to raising kids to be happy and productive citizens. Does that mean we turn our backs on girls and women who find themselves pregnant with no man in their lives? Of course not. I would be the last person to advocate that.”

Her statement begged the questions: What then, are we to do with this single parenthood epidemic that is a cancer on our society? How do we shore up the family? What is the government’s role?

It would seem, that generally speaking, Sarah Palin believes the government is doing too much and far more than it should–for everyone. She speaks directly to the arrogance of the current crop of political leaders saying (page 179):

“There is narcissism in our leaders in Washington today. There’s a quasi-religious feeling to the message coming from them. They are trying to convince us that not only are they our saviors, but that we are our saviors–not hard work, not accomplishment, just ‘believing in ourselves’ and what we can accomplish together through government. As candidate Obama proclaimed on Super Tuesday 2008, ‘We are the ones we’ve been waiting for, we are the change that we seek.’”

She continues:

“Everything that is worthwhile comes through effort. There is no free lunch. Anybody who tries to tell you otherwise is selling something–usually something paid for by your tax dollars.”

In the next chapter she tackles morality and religion. She sees freedom as intrinsically linked to the Sacred. One of my favorite lines from the book can be read on page 192. She says, “In other words, tyranny can thrive whether people are good or bad, but preserving freedom takes preserving virtue.” Here’s the rest of the paragraph:

“You can look, but you would have trouble finding an American from the founding generation who didn’t share this belief. This sentiment, so controversial today, was imply taken for granted at the time. The Founders deliberately and self-consciously constructed a government based on the belief that religion was at the root of the personal and public virtues necessary to sustain freedom. And they weren’t just being pragmatic. Despite the identification of many with Enlightened Deism, an eighteenth-century belief that strove to reconcile religion with reason, they all had genuine faith and genuinely believed that following its dictates was for the better, both in this life and the next.”

Sarah Palin believes a moral society is the underpinning of a free society. She disagreed with the JFK Houston speech (which got her in trouble with the Kennedy clan, evidently). She quotes Thomas Jefferson, “The God who gave us life gave us liberty at the same time. The hand of force may destroy, but cannot disjoin them.” (Page 195) “I love those words,” enthuses Palin.

Most Americans who read America By Heart will find little to object to therein. The Smarty Pants Set™, on the other hand, will despise the book. Sarah Palin takes aim at their cherished premises and counters them one by one.

In addition, Sarah Palin manages to write a highly philosophical book without sounding stridently ideological. Indeed, she says what most Americans believe but don’t say because they have been brow beaten into politically correct silence.

And yes, the themes and ideas espoused in America By Heart feel distinctly Reaganesque. However, unlike Barack Obama who studied tape of Reagan to get the gist of the lingo and mannerisms to appeal to broad audiences so as to deceive them into believing he had centrist ideas, Sarah Palin believes the ideas and sounds and acts…well, she sounds and acts like Sarah Palin. That is to say, Sarah Palin is a wholly unique political character and unlike anyone else in the political world.

Sarah Palin’s book articulates a message that stands in stark contrast to the philosophy driving current governance. The prevailing big-government, anti-American, military-diminishing, non-stop-regulating government isn’t going over well with Americans these days. Are they rejecting it, utterly?

Americans are certainly buying America By Heart. I witnessed this myself in Houston as fans braved the cold drizzle waiting for four hours to obtain Sarah Palin’s signature. Do they buy the message? Those in line sure did.

It’s been a long while since Americans have had such distinctive political and philosophical ideas before them. It will be interesting to see what road they choose.

What's wrong with facing down furry critters?

Rex Murphy, National Post · Saturday, Dec. 11, 2010

It's been quite some time since Fess Parker -- coonskin cap on head and long rifle in hand -- half-sung, half-yodelled the great anthem of Davy Crockett, King of the Wild Frontier. Parker played the legendary frontiersman/congressman Crocket both on TV and in a feature film. He was also one of a number of singers who sent the song about Crockett onto the hit parade of the 1950s more than once.

No question it's a song about a hero. We're told right in the first stanza that he was "born on a mountaintop," which is a pretty special way of arriving in the world -- or, for that matter, Tennessee. But the real stamp indicating that he's a hero-to-be comes in the third line stating that "he killed himself a bear when he was only three." Being able to handle yourself in the woods and face down the furry critters that live there is something Americans (and Canadians) have long recognized as a mark of character and competence.

Speaking of which, Sarah Palin shot a caribou on the recent episode of her Discovery Channel travelogue, Sarah Palin's Alaska. Evidently the sight of the downing assaulted the brain and sensibilities of one of Hollywood's princes, Aaron Sorkin -- the man who perpetrated the seven soporific and suffocatingly earnest seasons of The West Wing. May I note that, outside a forced viewing of Oprah wailing to Barbara Walters, modern television has no greater torment than any episode of The West Wing. Keep in mind that I've seen episodes of Geraldo At Large, so I'm setting the bar quite high here.

Sorkin immediately lashed out on what has become the official complaints office of outraged progressives, the Huffington Post, berating Palin in terms that would be harsh if applied to the Ebola virus. He called her filming of the hunt a "snuff film"; lumped her in with Michael Vick, the felon dogfight empresario; more than implied she enjoyed "torturing" animals; and essentially put her down as "deranged" and "disgusting." He capped the whole thing off ever so graciously with a kind of warning to "Sarah Palin's Army of Arrogant A--holes," who are also, he tells us, a bunch of "macho Sh--heads."

The last shot of the abusive fusilade was an accusation that Palin had done something no one else had ever done. He charged: "That was the first moose ever murdered for political gain."

Where to begin, as they say. Well, first, it wasn't a moose. It was a caribou. Certainly, a real sign of respect for the animal might be to get its name, or kind, right. Of the vile "snuff film" slur, I'd say that's both a term and a product far more likely to be found and appreciated in Aaron Sorkin's Hollywood neck of the woods than in Sarah Palin's. Furthermore, where's Sorkin's appreciation for Palin's environmentalism? She's showing herself to be one of the most advanced of our kind these days: She's a locavore. No carbon footprint on her prime rib.

But what on earth was Sorkin attempting to say with his confused lament that Palin's was the "first moose" ever killed for politics? Palin hunted before politics, and will continue to do so after politics. Same goes for her husband. It's what people do in Alaska -- or Newfoundland. She didn't just take it up for the Discovery Channel. Secondly, unlike those who are on a first-name basis with Martin and Charlie Sheen, most people have considerable admiration for those who can make their way in the wilds. As the Davy Crockett song makes so vividly clear, hunting prowess has always been held in special esteem -- and that esteem was not exhausted with the end of pioneer days. The skill still earns a man -- or a woman -- a singular kind of credit with others.

Sorkin stumbles into this insight but doesn't recognize that he has. How would it advantage Palin to kill a moose or caribou on television unless people saw the deed as something admirable?

I know that back home in Newfoundland, if your local Member of the House of Assembly (MHA) has a moose licence and can find a moose, shoot it, clean it and bring it out -- why then that MHA has shown a kind of credential. He is an adult, a person who can take care of himself, who understands some of the rhythms of Newfoundland life and who is continuing some of its finer traditions. It's a statement. The moose isn't shot for politics, but it inevitably falls into some loosely considered political context. If you're a numb-nut who can't find your way around in the woods and wouldn't know a moose from an oil truck -- why then that's a statement too.

And of course hunting is not just limited to moose: Also pursued for their various delights are (and I'm naming only some examples) partridge, turr, rabbit and, of course, the ubiquitous and savoury seal. Hunting, like poetry, offers both utility and pleasure.

Once again it seems, as is often the case with most matters Palin, that it's the former Alaskan governor's critics who are both out of touch and intemperate.

- Rex Murphy offers commentary weekly on CBC TV's The National, and is host of CBC Radio's Cross Country Checkup.

Read more: http://www.nationalpost.com/todays-paper/What+wrong+with+facing+down+furry+critters/3962233/story.html#ixzz17og74FWg

Thursday, December 9, 2010

Coldest in central England since 1659

Meteorologist Joe Bastardi

8 Dec 10 - "The central England Temperature (CET) from the 1st-7th of December is -1.9, making this the coldest opening week of December since 1879," says meteorologist Joe Bastrardi.

With 1879 being the coldest opening week on CET record, this week has been the second coldest opening week to December since CET records began in 1659.

Those records are for a one-week period.

When you look at the two-week period, says Bastardi, the last week of November and the first week of December, it's the coldest since CET records began in 1659.

This puts central England back to the temperatures of the Little Ice Age.

And there's more to come, Bastardi warns.

"Preparation for renewal of extreme cold from France to Scandinavia and west through the UK should be made."

See entire article:
http://www.accuweather.com/ukie/bastardi-europe-blog.asp?partner=accuweather

The Economic Legacy of the Four-Year Democratic Congress (American Thinker)

 

By Yossi Gestetner

From early 2007 through the end of 2010, the Democrats had strong Majorities in -- and control of -- the US House of Representatives and also the U.S. Senate. Both are chambers where laws and policies that affect the economy are created and shaped.

The following table shows how the Democrat Congress performed on average during its four year tenure, vs. the average of the previous four years, 2003 through the end of 2006, when Republican were at the helm:

Issue/Topic

Democrats

Republicans

Jobs by Year - Average

-1,583,000

+1,672,000

Jobs by Month - Average

-131,916

+139,333

Unemployment Rate - Average

7.48%

5.3%

Budget Deficits - Avrage

$1.143 Trillion

$285 Billion

Dow (DJIA)

0.13% (0.53 Total)

11.04%

S & P 500

1.29%

15.02%

FDIC Bank Closures - Average

79.2

1.75

Following are the numbers in more detail (2010 statistics will need to be adjusted with the close of December. However, the general picture won't change much anyway.):

Non-farm Payroll by Year:

2003 = 87,000;

2004 = 2,047,000

2005 = 2,496,000

2006 = 2,060,000.                   Four Year Total Republicans: 6,690,000 Jobs GAINED.

2007 = 1,078,000

2008 = 3,623,000 Minus

2009 = 4,740,000 Minus

2010 = 951,000                       Four Year Total Democrats: 6,334,000 Jobs LOST!

Take note that the 2009 Stimulus "Could have been worse" year, was indeed worse than the previous year, by 1.1 million more jobs lost.

****

Unemployment Rate by Yearly Average (calculated by dividing in twelve the total monthly Unemployment Rate):

2003  5.99;

2004  5.54;

2005  5.08;

2006  4.61;

2007  4.61;

2008  6.37;

2009  9.28;

2010  9.66

****

Budget Deficits (The Fiscal Years starts three months into the previous colander year, such as FY 2007 was drawn up during 2006 with a Republican Congress). Numbers are in Billions except when indicated otherwise.

FY 2004 = $412

FY 2005 = $318.7

FY 2006 = $247.7

FY 2007 = $162                      Total Added Republican Budget Deficits: $1.140 Trillion.

FY 2008 = $454

FY 2009 = $1.416 Trillion

FY 2010 = $1.294 Trillion

FY 2011 = $1.41 Projected by the White House, July 2010

Total Added Democrats Budget Deficits: $4.574 Trillion!

NOTE: If I hear a Republican say one more time that "we lost our way" on spending, I'll be tempted to jump ff the Tappan Zee Bridge in NY. I'll take a Republican Congress for the next 100 years, four times faster than a Democrat Congress.

                                                       ****

Dow Jones Industrial Average Annual Returns

2003 = 25.32%

2004 = 3.15%

2005 = 0.61% Minus

2006 = 16.29%                                    Total Four Year DJIA Republican Growth: 44.15%

2007 = 6.43%

2008 = 33.84% Minus

2009 = 18.82%

2010 = 9.12% as of the Close Friday 10/3/10.          Total Four Year DJIA Dem Growth: 0.53%

                                                   ****

S&P 500 Index Annual Returns

2003 = 28.72%

2004 = 10.82%

2005 = 4.79%

2006 = 15.74%                                    Total Four Year Republican S&P Growth: 60.07%

2007 = 5.46%

2008 = 37.22%  Minus

2009 = 27.11%

2010 = 9.81% as of the Close Friday December 3, 2010.       Total Four Year Democrat S&P Growth: 5.16%

                                                  ****

FDIC Banks Closures as reported by the FDIC

2003 = 03

2004 = 04

2005 = No Bank Failures

2006 = No Banks Failures                     Total in Four Republican Years: Seven.

2007 = 03

2008 = 25

2009 = 140

2010 = 149 and counting                    Total in Four Democrat Years: 317!

The author can be reached via email yossi@yossigestetner.com

Page Printed from: http://www.americanthinker.com/2010/12/the_economic_legacy_of_the_fou.html at December 09, 2010 - 07:59:20 AM CST

Class Warriors Got What They Wished For (American Thinker)

 

By Randall Hoven
A funny thing happened on the way to spreading the wealth: wealth dried up.

A good class warrior wishes for three things (at least).

  • (1) For tax rates to be highest on the richest. Ideally, only the rich would pay taxes. The Father of Class War, Karl Marx, made "a heavy progressive or graduated income tax" one of the ten planks of his Manifesto.
  • (2) For no one to be super-rich. Ideally, no one would make more than some amount considered too much. Barack Obama, the Son of Class War, once said, "I do think at a certain point you've made enough money."
  • (3) For Government to have plenty of money so that it can spread the wealth and help the needy. The Democratic Party, the Holy Ghost of Class War, put in its 2008 platform, "For families making more than $250,000, we'll ask them to give back a portion of the Bush tax cuts to invest in health care and other key priorities."

Now think about that for a moment.  If the class warriors got their first two wishes, their third wish would be impossible.  If you tax only the rich, yet you have no rich, then government collects no revenue.  You can't spread wealth if there is no wealth.
 
And here is the punch line: that is exactly what is happening now, just not as starkly.
 
In 2007, those making over $200,000 per year did not pay all federal income taxes -- just 52% of them.  Then came the Great Recession.  Taxable income of that group declined 16% from 2007 to 2008.  Taxable incomes went up slightly for the middle class, or those households making between $40,000 and $200,000.
 
And what about the really rich: those with gross incomes over one million dollars?  There were 18% fewer tax returns from such households and 25% less taxable income.  As a result, the federal government collected $60 billion less from such households in 2008 than in 2007.  (See tables at the end of this article.)
 
The Great Recession was a great time for class warriors.  Incomes for the rich went down quite a bit in a single year (and only the first year of the Great Recession) while those for the middle class stayed about the same.
 
The result was predictable: much less revenue for the government.  Federal income taxes from the middle class ($40,000 to $200,000) went up by $2 billion, but those from the rich (over $200,000) went down by $73 billion.  This was not because of tax rate cuts; there weren't any.  It was because there were fewer rich households and less income for such households.
 
Real GDP fell only 2.8% from 2007 to 2008, but federal revenue fell almost twice as much: 5.2% in constant dollars.  Through 2009, federal revenues were down 21% from 2007, leaving a gaping shortfall in revenue of over half a trillion dollars (inflation adjusted) and an unprecedented federal deficit.  (Tax figures for 2009 are not yet available.  I suspect they will show the same pattern: loss of federal revenue due to loss of income at the higher levels.)
 
Revenues did not fall because of a tax rate cut; there was no tax rate cut between 2007 and 2009.  Revenues did not fall because of some give-away to the rich.  In fact, the problem was just the opposite.  Revenues fell because there were fewer rich and the rich made less money -- just as class warriors wanted.
 
We had a progressive tax structure that relied on the rich getting richer.  Then we got what we wished for: for the rich to become like us.  So now we're all broke.  We had a bubble-based tax system, and the bubble burst.
 
Why do you think revenues fell by over 20% to the federal government and states like California during the Great Recession, when GDP fell only 4%?  Because the federal government and states like California have extremely progressive tax structures.  You get rid of the rich, and you get rid of government revenues (and job creation).  Believe it or not, the rich lost more money in the Great Recession than the rest of us did.  Our golden goose is cooked.
 
Discussions of how much to tax the rich are ever more akin to fiddling while Rome is burning.  Before you can get money from the rich, you have to have rich households and they have to have money.  You can't tax what you've destroyed.
 
Be careful what you wish for.  Or vote for.
 
Randall Hoven can be contacted at randall.hoven@gmail.com or via his web site, randallhoven.com.
 
Some key data from the IRS are summarized in the tables below.  Source:  IRS, Table 3.5, for the years 2007 and 2008.  Data for tax year 2009 are not yet available through the IRS site.  (Dollar amounts in the table below are rounded.  Percentage changes were calculated on the unrounded values in the original IRS tables.)
 
Number of Tax Returns

AGI

2007

2008

Change

Under $200,000

105,995,320

103,618,393

-2.2%

$40K to $200K

55,350,570

55,414,032

+0.1%

Over $200,000

4,527,350

4,359,936

-3.7%

Over $1,000,000

391,432

319,432

-18.5%


Taxable Income ($billions)

AGI

2007

2008

Change

Under $200,000

$3,615

$3,592

-0.6%

$40K to $200K

$3,063

$3,067

+0.1%

Over $200,000

$2,449

$2,061

-15.8%

Over $1,000,000

$1,245

$938

-24.6%

 
Federal Personal Income Tax Generated ($billions)

AGI

2007

2008

Change

Under $200,000

$551

$550

-0.2%

$40K to $200K

$486

$488

+0.4%

Over $200,000

$604

$531

-12.0%

Over $1,000,000

$315

$255

-19.1%


Page Printed from: http://www.americanthinker.com/2010/12/class_warriors_got_what_they_w.html at December 09, 2010 - 07:54:45 AM CST