Rome Falls and America Follows - part two

Yesterday we began drawing parallels between the fall of the Roman Empire and the path that America is now on. Because of the long list of complex issues, we only managed to get about halfway through the main reasons. Today we pick up where we left off and the remaining items on the list seem to have even more relevance to America than what was discussed yesterday. Those items are:

Failing Economy
Unemployment of the Working Classes (The Plebs)
The 'Mob' and the cost of the 'Games'
Decline in Ethics and Values
Slave Labor
Natural Disasters
Christianity
Barbarian Invasion

Failing economy: As the flow of captured wealth to Rome diminished, it became increasingly difficult to fund the Legions defending the far reaches of the Empire. There had always been a wide disparity between the elite and the poor of Rome which exacerbated Rome’s economic problems as opportunities for employment dwindled among those of the lower classes. Of course the Roman elite still expected luxuries from the Far East and an increasing amount of gold was used to purchase those goods, creating a shortage of gold to coin money in Rome. The resulting unemployment, high taxes and inflation placed the government at constant risk of bankruptcy.

Teddy Roosevelt lauded the idea of a progressive tax system and the redistribution of wealth although he never had the opportunity to put either into practice. Instead, we would have to wait until Woodrow Wilson for a progressive income tax and FDR to figure a way to use that money to advance an agenda that would culminate in today’s entitlement culture. By abandoning capitalist principals and punishing the attainment of wealth through the progressive tax system, we have seriously hampered the ability of our economy to grow in proportion to her population.

The increasing numbers of people that have been raised as second and third generation recipients of government support programs have created an entire class of people that rely solely on government instead of their own abilities, further depleting the treasury. Worst yet is that the number of people that pay the taxes are slowly becoming the minority with those that pay no taxes or collect government benefits now sitting at 47%. Our government has turned to high taxes and credit to continue funding these benefit programs rather than returning to our capitalist roots. The resulting debt has created a shortage of money in the private sector, further damaging our economic stability and creating an unsustainable trend of shifting economic activity from the private to the public sector.

Unemployment of the Working class: Since this title ties directly into the segment above, I will only add that the shortage of capital in the private sector and the threat of increased taxes and government regulation has severely impacted the job market in the United States. As long as business must compete with an out of control government for available credit and as long as business owners operate under the threat of increased government tax and regulatory liabilities, the unemployment trends will not reverse. Our bizarre trade agreements and aggressive taxes have done little to benefit the manufacturing communities within the United States and many of those jobs will never return as long as there is an economic advantage to manufacture overseas. The rest have been regulated out of existence or have been so seriously impacted that they are near collapse.

The 'Mob' and the cost of the 'Games': In order to placate the mobs of unemployed workers, the Roman government found increasing amounts of money going to fund gladiatorial games to occupy the masses. Of course this was only a temporary means to quiet civil unrest and more spectacular events had to be presented to keep the mobs occupied. The games would eventually consume more that a full third of the total income of the Empire.

Of course we don’t have bloody competitions to amuse the poor and unemployed but we do throw an awful lot of money at the problem through government entitlement programs. The problem is as the government spends more, they consume the monies that would ordinarily stay in the economy to create the jobs that would eventually, alleviate unemployment and poverty. There is a minor percentage of the population that would always be unemployed because of disabilities, poor life choices and yes, even because they were raised to be government dependents. Unfortunately, the addition of high unemployment to that base has stressed the entitlement structure to near collapse and it is reaching the point where our public outlay for these programs is nearly on par with the expense of the Roman games.

Decline in ethics and values: Do I really need to expand on this? I think anyone that has read the news lately would agree that the ethics and values of our nation are being seriously challenged. Not because the average American is so depraved, but rather because we are constantly inundated with legal challenges from our friends on the left to accept the unacceptable. There is even an ongoing full court press to introduce many of these radical and morally bankrupt ideas into our schools to infect our children before they have fully developed the moral armor needed to fend off the assault. Parents are being denigrated by these people and they are trying to convince our children that we are old fools that just don’t know any better. Once a society has lost respect for its elders it has lost its past and without its past, it has no future.

Slave Labor: Rome captured many people from occupied lands that would work as slaves for the Empire. Slave labor was essential to Rome because so many Roman men were under arms to defend this expansive Empire. Since slaves were disposable, slave labor added to the decline of morals and ethics as happens when people routinely treated other humans with such miserable disregard. Since slave labor replaced so many Roman men, Rome also suffered from technological stagnation as skilled labor was replaced with unskilled slaves performing a trained task.

Hmm. This is a difficult one. I could comment on our own spotted past but America was courageous enough to abolish slavery and even fought a bloody civil war to bring about abolition. Instead I will say that the oppressive taxation used to fund the distributive policies of Progressive politicians has effectively created slaves of anyone that pays taxes. The taxes are not fair and because they are easily attained, politicians have no compelling interest in reducing them. In fact, Progressives routinely vilify the wealthy to justify their acts of legalized theft just as slave owners dehumanized their human possessions to justify the harsh treatment of other men. Our wealthiest Americans now bear so much of this nation’s financial burden that they are fast approaching the point where not working and living on their savings is becoming increasingly appealing. Tell me that is not an induced loss of ethics and values?

Natural Disasters: Well, Rome faced them and so do we.

Christianity: Christianity not only challenged the established faith structure of the Roman Empire but the excessive and immoral practices of the ruling elite. The adoption of Christianity struck at the heart of the core of Roman culture and fundamentally changed the entire structure of Roman society.

Today we have a growing number of people that show open disdain of America’s Judaeo-Christian roots. This country was founded with deeply religious beliefs and without those beliefs; the tenant that we are endowed by our creator with certain inalienable rights suddenly rests on very shaky ground. If God did not grant our rights, who did; Government; The Constitution? If they were granted by an act of law then they can certainly be denied by an act of law. Contrary to popular belief, the largest threat to our religious foundation is not being waged by Atheists or Muslims; it is being waged by the ecological movement. They are actively engaged in a fight to protect “mother” earth to the detriment of her human inhabitants. So misguided are these new fundamentalists, that some have embraced a new age religious belief that earth has a soul and awareness that must be honored. Some have even proposed that mankind should cease breeding and bring about the voluntary self-extinction of man so that the earth can finally heal from our horribly destructive ways.

Finally, Barbarian Invasion: Rome had conquered almost all of Europe but was faced with Barbarian assaults on nearly every one of her new borders. The expanse of the Empire and the decline of their economy left them economically unable to fend off Barbarian attack and as the Roman Empire receded, the Barbarians followed their retreat.

We aren’t facing Mongol hoards or waves of Vandals but we are faced with an equally brutal enemy, partially because of our interference in their home lands but also because their religious beliefs do not tolerate any religious faiths other than their own. Of course I am referring to Muslim radicals. Like the Barbarians that the Roman’s faced, radical Muslims will not stop until we are dead, or they are. Unfortunately, they are in a race to obtain weapons that will make their attacks against us even more devastating.

So there it is. What truly frightens me is that none of my attempts to parallel the fall of Rome with the current actions of America are really a stretch of the imagination. So the question is “What do we do now?” Do we continue down the same path until our society collapses under its own weight and the Barbarians are at the gates or do we take the immediate and drastic steps needed to restore our culture and country to point in time before Progressive ideals began chipping away at our morals, economy and God given rights?

Paul

Rome Falls and America Follows - part one

Yesterday we covered an abbreviated history of the rise and fall of the Roman Empire. Grant it, two and half pages can hardly cover nearly 100 years of history but I was really only using small portions of their history to illustrate a point about our own society and situation. As stated yesterday, the main causes of the collapse of the Roman Empire was:

Antagonism between the Senate and the Emperor
Decline in Morals
Political Corruption and the Praetorian Guard
Fast expansion of the Empire
Constant Wars and Heavy Military Spending
Barbarian Knowledge of Roman Military Tactics
Failing Economy
Unemployment of the Working Classes (The Plebs)
The 'Mob' and the cost of the 'Games'
Decline in Ethics and Values
Slave Labor
Natural Disasters
Christianity
Barbarian Invasion

So let’s examine the parallels between ancient Rome and the United States on a point by point basis.

Antagonism between the Senate and the Emperor: Because of the absolute power given to the Emperor with the role of the Senate degraded to that of an advisory capacity, the Senate was constantly at odds with the Emperor and that seriously impacted the ability of government to act in the interests of the Empire as a whole.

In the United States, our government has also has descended to a base argument over power. American Presidents since the time of Theodore Roosevelt have had agendas that required the creation of enormous new Federal agencies. These agencies began stealing the State rights supposedly guaranteed under the 10th Amendment through the stated goal of enacting minimum standards for the benefit of all States. This was first seen with food and drug safety under the FDA created by Teddy Roosevelt. Federal regulatory power brought about through new agencies continued ever since and has expanded incrementally; controlling nearly every activity of life in America. Over time, the agencies themselves became enormous and bloated bureaucracies that have diluted the power of Congressional oversight and have assumed unconstitutional control over the electorate by the use of regulations issued by the agencies themselves.

Because of the subversive activities of the Progressive movement, the Congress itself has become ideologically polarized. The very function and Constitutional authority of Congress has been re-written through a serious of small moves only possible by mutating the intent of the enumerated powers. Our government has become as much of an ideological battle ground as the Roman government was at the highpoint of their decline.

Decline in Morals: Because the economy of Rome was based on conquest and the taxation of occupied peoples, there was no real sense of creating sustainable wealth through Rome’s economic activity. With a steady flow of captured wealth, leisure time exploded and leisure activities quickly became boring. Bored people constantly move beyond the norm to find excitement and a Rome plagued with excesses, would eventually descend into a moral abyss. Nothing was off the table. Prostitution, slavery, sloth, gluttony, orgies, incest, sex with children and homosexuality had exploded as the elite chased new forms of entertainment and the elite after all, ruled the land.

Is there any doubt that America has rejected its societal morality? I say societal morality because on average, Americans are still a moral people. There has been a corruption of our courts that have allowed a minority of iconoclasts to justify things that would have tested public sensibilities as little as fifty years ago and would have caused massive civic outrage less than a hundred years ago. The Federal government has not only legislated protections for these questionable activities, circumventing the Constitutional right of the States to determine their own direction, but has even funded some of these moral assaults through agencies like the FCC and the National Endowment for the Arts.

Political Corruption and the Praetorian Guard: The Praetorian Guard was the Emperor’s personal army and would shield the Emperor from any attempt of the Senate to reign in Imperial excesses or to reinstitute Constitutional government. While our President does not have a personal army, he does have a closed circle of advisors and Czars that have not only diluted the Constitutional authority of the Congress but have obviously corrupted the governmental process through their secretive strategies to use agency fiat to affect the President’s agenda.

Fast expansion of the Empire: In order to fund the Empire, Rome launched a military campaign that would eventually stretch the limits of the Empire to over two and half million square miles in area and brought them right to the borders of the Barbarian territories; a mistake that would plague them later as the economic strain of supporting their massive occupation became unsustainable. While we don’t engage in wars of conquest, nor do we have vast areas of militarily occupied territories, we have seen a rapid and massive increase in the size and scope of the Federal government. The spending required to support this monstrosity is equally as devastating and has quickly brought the most vibrant and prosperous economy in the history of the world to the brink of ruin.

Constant Wars and Heavy Military Spending: The Roman Empire existed through war and expansion of the Empire was central to feeding the greed of their Imperial economic machine. It was when the wealth of the occupied territories fell flat that the Roman legions became a strain on the Empire. In America, it was just before the turn of the Twentieth Century that the focus of the American Military began to change because of a shift in the ideology of industrial era Presidents. Beginning with the Spanish-American War, America began to flex its newly acquired military muscle under the banner of expanding democracy and fighting foreign, imperial expansion. The role of the military until that point was the protection of the American States. By embarking on a path of global protection we have assumed the burden of funding a military that far exceeds our own need for protection and well beyond our current financial abilities.

Barbarian Knowledge of Roman Military Tactics: Roman military tactics were rigidly trained and vigorously adhered to. As Barbarian tribes gained more experience in fighting the Roman Legions, they used that mindset of rigid strategy against the Romans. While our modern military has a technological advantage that has yet to be defeated and the initiative based strategy used by our command structure is not nearly as rigid as the Roman style of leadership was, we still have an exploitable weakness.

Since we have civilian control over our military, our enemies have mastered the tactic of using public opinion against us. Just the unsubstantiated accusation of abuses has often been enough to threaten the support of the American people for military action in a foreign land. Civilian control of the military is critical to a democratic Republic and works very well with a defensive force. Once we use the military to enforce an ideological view of what is right and wrong beyond our own borders, civilian control becomes divided because there is no plurality of opinion in the use of military force for that purpose. That division creates civil conflict within our nation and leads directly to revisions of military policy that endangers the mission and the lives of the soldiers charged with carrying out that mission.

I try to keep my ramblings to roughly two and half pages so that my blog articles don’t become oppressively long. We are about halfway through the list of causes for the fall of the Roman Empire and we can already see direct and frightening parallels to each and every one of them. Tomorrow we will continue with some of the more frightening and unfortunately, even more relative items on that list. Please join me tomorrow as we complete this examination.

Paul

The Fall of the Roman Empire - Is America Taking the Same Path?

In the two hundred years since the American Revolution was fought and won, our country has gone from a band of rebellious colonial upstarts that defeated British rule in 1781 to becoming the world’s last remaining Superpower by the 1990’s. As remarkable as that story is it will pale in comparison to the story of our current race to commit national suicide. While the Progressives began their assault on the Constitution over a hundred years ago, the decline of America really began to accelerate twenty years ago and we are now challenged with making the decisions that will either restore America to sanity and prosperity or will complete the destruction. The day of reckoning is here and we can no longer delay the choices. The big question is what choice will we make?

One would think we would turn to history for some insights. After all, history is replete with examples of other societies and civilizations that were faced with similar challenges. Most chose poorly and as a result, we now study the ruins they left behind; examining the documented history of how their choices collapsed their society. One perfect example is the Roman Empire.

The Roman Empire had its roots in a small agricultural community on the Italian peninsula. The legends claim that twin brothers, descended from a Trojan Prince, founded the City of Rome in 753 BC. The brothers, Romulus and Remus were purportedly conceived when Mars, the God of war, raped a vestal virgin named Rea Silvia who gave birth to the twins. Because Romulus and Remus were fathered by the God of war, they were considered half divine. As the story goes, their Grandfather and King of Alba Longa, Numitor, was deposed by his rival Amulius. Fearing the twins would recapture the throne, Amulius ordered them drown. A she-wolf would save the boys from death and raise them. Once grown, Romulus and Remus returned to Alba Longa and restored Numitor to the throne before departing to found their own city. In a dispute over who would rule the new city, Romulus killed his brother and assumed the crown. Now that his throne was secured, the City would be named Rome in honor of its king, Romulus.

For the following two hundred and fifty years, Rome would prosper as a Monarchy led by seven successive Kings. Just as the American colonists revolted against the British crown, Rome revolted against King Lucius Tarquinius Superbus in 509 BC. Superbus was noted in history as a tyrannical dictator but revulsion turned into open revolution after Superbus’s son, Sextus Tarquinius, raped Lucretia, who was an important noblewoman in the Kingdom. The people of Rome succeeded in their revolt and deposed the tyrannical King, replacing the Monarchy with an Oligarchic Republic.

The Roman Republic was a system based on annually elected magistrates and various representative assemblies was established. A constitution set a series of checks and balances, and a separation of powers. The most important magistrates were the two consuls, who together exercised executive authority through the imperium, or military command. The consuls had to work with the senate, which was initially an advisory council of the ranking nobility, or patricians, but grew in size and power over time. While there are many differences between the Roman Republic and America, there are also a number of parallels, particularly in the forces that worked against the Republic.

See if this sounds familiar? Violent gangs of the urban unemployed, controlled by rival Senators, intimidated the electorate through violence. The situation came to a head in the late 2nd century BC under the Gracchi brothers, a pair of tribunes who attempted to pass land reform legislation that would redistribute the major patrician landholdings among the plebeians or working class. Both brothers were killed, but the Senate passed some of their reforms in an attempt to placate the growing unrest of the plebeian and equestrian classes.

Curiously, that sounds like our own radical fringe that would eventually become today’s “Community Organizers”. Rome’s community organizers also had their sympathetic Senators that brought about reforms to redistribute Roman wealth with land instead of cash. Just as today, the sympathetic Roman Senators forced the rest of the Senate to pass some of these reforms just to prevent civil unrest. It almost sounds as if the Gracchi brothers were the ancient equivalent of Cloward and Pivens that proposed the poor work to overwhelm the system and punctuate those efforts with threats of violence in order to bring about social justice. Rome’s sympathetic Senators could quite easily be paralleled with today’s Progressives in Congress on their quest for redistributive policies.

To continue; the Republic grew through a series of wars, allowing Rome to occupy much of the Italian peninsula. Of course with growth comes power and with power comes corruption. In the mid-1st century BC, three men, Julius Caesar, Pompey, and Crassus, formed a secret pact—the First Triumvirate—to control the Republic. After Caesar's conquest of Gaul, a stand-off between Caesar and the Senate led to civil war, with Pompey leading the Senate's forces. Caesar emerged victorious, and was made dictator for life. While we haven’t had a dictator assume power in the United States, it is a well known fact that we came very close to just that in the early days of Franklin Roosevelt’s Presidency when there was a secret pact among the Democratic hierarchy that actually urged FDR to assume dictatorial powers to combat the depression. Fortunately, that never happened and the Constitution survived both the depression and FDR.

The Roman Republic however, would not survive. Caesar was assassinated in the 44 BC attempted Senate coup to restore Constitutional government. The aftermath created a Second Triumvirate, consisting of Caesar's designated heir, Octavian, and his former supporters, Mark Antony and Lepidus that took power. However, this alliance soon descended into a struggle for dominance. Lepidus was exiled, and when Octavian defeated Antony and Cleopatra of Egypt at the Battle of Actium in 31 BC, he became the undisputed ruler of Rome.

Rome under the absolute rule of Octavian and his successors would become a vast Empire and eventually ruled over two and a half million square miles of the ancient world. The Empire dominated the entire Mediterranean coast including northern Africa, most of the European continent and even most of the British Isle. Of course the Roman economy was only an illusion that relied on a steady flow of loot from its wars of conquest and the taxes collected in the occupied territories. Hmm? That sounds like the illusion of our own economy. Instead of tribute collected from conquered lands our government spends borrowed money on the promise that future generations will somehow find a way to pay for the debt. The problem with economies based on conquest or credit is that they both ignore the hard work needed to sustain the spending and are therefore, both doomed to fail. Rome took all there was to take and by the time captured cash stopped pouring into Rome, the Roman people had forgotten what it meant to work for themselves and that sounds familiar too. Even more familiar are the chief causes listed for the collapse of the Roman Empire.

Antagonism between the Senate and the Emperor
Decline in Morals
Political Corruption and the Praetorian Guard
Fast expansion of the Empire
Constant Wars and Heavy Military Spending
Barbarian Knowledge of Roman Military Tactics
Failing Economy
Unemployment of the Working Classes (The Plebs)
The 'Mob' and the cost of the 'Games'
Decline in Ethics and Values
Slave Labor
Natural Disasters
Christianity
Barbarian Invasion

Tomorrow we will discuss the causes for the fall of the Roman Empire and how our society is now enganged in the modern equivalent of many of the same things.

Paul

The President's Healthcare Plan - Just More Things to Despise

To make good on his promise, or threat depending on how you look at it, the President released a summary of his healthcare proposal on Monday morning. I haven’t been able to find a full copy of the text as of yet and if all he intends to post to the internet is a summary / infomercial, then I am truly concerned. Considering what is in the summary, I can only imagine what horrors the full text of the proposal has in store for us. Bear in mind, this is not a full proposal designed to replace the bill that a majority of Americans would like to see tossed; this is yet another addition to the more than two thousand pages that already exist.

In essence, the President’s proposal has taken a bill Americans already hate and gave us even more to despise. There are more tax increases, higher penalties for not purchasing health insurance, a clever renaming of the medical device fee to an excise tax and a “millionaire’s tax” of 5.25% levied on people earning a quarter of what it takes to be a millionaire. Incidentally, the millionaire’s tax also contains a marriage penalty where tax is levied against single people earning more than $200,000 and couples earning more than $250,000.

The President’s plan still punishes health insurance companies, extorting $67 billion dollars in fees to help the enrollment process on the assumption that insurance companies are going to make so much money from all the new people that will be forced to purchase insurance. Well, if this plan is meant to allow access to health insurance for the 30 million Americans that are reportedly without insurance, then what are we talking about, a ten percent increase in business? But wait, the income assessment used to force people to purchase insurance doesn’t kick in until you earn more than $18,700 per year so you can hack off a healthy portion of that 10%. This does not take into consideration that once the exemptions for pre-existing conditions are removed from the equation, some will simply prefer to pay the penalty knowing that they can always get insurance later when it is an absolute necessity saving themselves thousands in premium costs.

The President couldn’t eliminate the additional tax on “Cadillac” healthcare plans to make his union friends happy without an uproar so he did the next best thing. He postponed that tax until 2018 and by then, private insurance should be a thing of the past. Oh yes, private insurance will be decimated by the President’s plan. His proposal includes capping premium costs knowing that the industry only has a 3.4% profit margin now; a margin that will not be able to keep up with rising health provider costs as more people are absorbed into Medicaid and Medicare. You see, it is the paltry amount that the Federal government reimburses doctors and hospitals for Medicare and Medicaid services that created the problem in the first place. Hospitals and doctors are forced to increase their charges to private insurance to make up the shortages and private insurance must pass that on to you in what is really, the largest hidden tax to fund those programs ever perpetrated on the American people.

The President’s plan has a “grandfather” clause that will allow people that like their current insurance to keep that plan. Hmmm? Why would we need a grandfather clause if their intention wasn’t to force people to accept certain plans that the government will choose for you? In fact, the grandfather clause isn’t worth much since the government will force changes to these plans that will no longer make them profitable. You see, you can’t get to the single payer system the President really wants if you get to keep a plan that will not go away. The changes that the providers of these plans will have to make will ensure they cannot remain competitive.

The President’s summary states: “Within months of legislation being enacted, it requires plans to cover adult dependents up to age 26, prohibits rescissions, mandates that plans have a stronger appeals process, and requires State insurance authorities to conduct annual rate review, backed up by the oversight of the HHS Secretary. When the exchanges begin in 2014, the President’s Proposal adds new protections that prohibit all annual and lifetime limits, ban pre-existing condition exclusions, and prohibit discrimination in favor of highly compensated individuals. Beginning in 2018, the President’s Proposal requires “grandfathered” plans to cover proven preventive services with no cost sharing.” In short, by 2018, these plans will either be eliminated by the provider or will be too expensive to purchase to all but a few.

Pharmaceutical companies will also be hit hard as official preference is given to generic drugs. Ignoring the companies that actually pioneered the creation of new drugs and had to fund the expense of clinical trials and Federal approval will create a stagnant climate within the pharmaceutical industry. This short sighted approach will have a detrimental limiting effect on research and development of new drugs and treatments. The President’s plan also increases the government theft of pharmaceutical company profits $10 billion dollars more than the Senate plan proposed for a total of $33 billion over ten years.

Medicare Advantage is also targeted by the President’s plan and while the summary makes a base assessment that Medicare overpays private plans by an average of 14% to provide the same services as the regular Medicare programs, his summary refuses to actually say what is going to be cut and where. His plan creates a set of benchmark payments at different percentages based on the current average fee-for-service costs in an area. Of course while his summary calls this section “Improving Medicare Advantage Payments” it could just as easily be called “good luck finding a doctor that will accept Medicare Advantage now”. The only reason people go through the expense of paying for Medicare Advantage is that many doctors simply do not take “traditional” Medicare because of the their miserable payment rates. Adjusting the rate structure to something more like Medicare will only make Medicare Advantage as unpopular with doctors as Medicare is currently.

There is the creation of what the President himself calls an “unprecedented array of aggressive new authorities to fight waste, fraud and abuse.” Ok, so we are expected to believe that the savings from the “waste, fraud and abuse” uncovered by this “array” of new authorities will not be consumed entirely by the “array” of new authorities. Call me silly but couldn’t fraud and abuse be adequately pursued and prosecuted by an already bloated and underutilized Justice Department? As far as fraud is concerned, that simply sounds like there needs to be a little house cleaning over at the existing Medicare and Medicaid administrations so that these people actually perform their jobs.

Of course nothing is more devastating than the employer mandates. The President insists that there are no employer mandates in his plans but there are fees that start with companies of 50 or more employees. A fee of $750 would be assessed for every one of that company’s employees even if only one of those employees should purchase insurance with taxpayer assistance; that my friends, is known as a job killer. The carrot of a tax credit is meaningless because the requirements outlive the credits and leave businesses holding the bag for all time. Companies with 55 or 60 employees will find a way to get the job done with 54 and many larger companies will just close their American plants and outsource to foreign companies in countries that were smart enough not to elect a socialist President. There is also an additional tax for employers that offer no insurance or insurance that does not meet “government standards”. The tax would roughly be an 8% payroll tax phased in for employers with annual payrolls from $500,000 to $750,000 which really doesn’t take that much to reach these days now does it?

Of course no plan ever crafted by a Progressive Democrat would be complete without a little bait and switch. The President’s proposal gives billions to Community based health centers and that just sounds like a big “Thank You” from the President to all of the Community organizations that helped him get elected. While the Nebraska deal is tossed out in the President’s plan, the Senate’s “working girl” from Louisiana, Mary Landrieu, gets to keep her $300 million bribe and other States will get a kickback of one degree or another to buy their silence. The President also plans on using this bill to close what he calls a tax loophole in an entirely unrelated clean energy tax credit bill and clearly states that some of the money you good people will be paying for the Healthcare reform bill will be diverted, if needed, to shore up Social Security.

This is nothing less than a nail gun to seal the coffin of private healthcare insurance in this country. Why would the President and Progressive Democrats want to cripple the healthcare system? Because they need to redirect all of the money spent on healthcare in this country into one massive entitlement program just to keep the failed programs of Medicare, Medicaid and Social Security on life support for the next ten or twelve years. This is a shameless attempt to trick the American people into believing that this about healthcare when it is just another attempt to funnel more power and money into the corrupt abyss of Washington.

Paul

Is Newsweek Stacking the Deck for Heathcare Reform?

American support for the Democratic healthcare plan continues to fall and each new appearance of President Obama, Harry Reid or Nancy Pelosi seems to have the effect of chipping away at what little remains. The White House claims that the loss of support only means they haven’t done an effective job of “explaining” the initiative while Congressional Democrats blame the Republicans and corporate America for seeding the discussion with lies. Neither school of thought will be effective at selling the proposal because both contain the same message; the American people are ignorant and gullible.

The President and his friends in Congress will not win the hearts of the American people by telling them that their opposition to his plan is because he didn’t use little words that they would understand. Are Progressive Democrats so arrogant that they believe their plan has very little approval simply because people can't understand it? The American people have actually taken a long hard look at the legislation and are appalled at what they’ve found. The waning support for healthcare reform has nothing to do with the rhetoric of talk radio, Fox news or Congressional Republicans and has even less to do with televised commercials. It does however; tie in very neatly with the ever increasing list of broken promises and lies attributed to this President. The fact is that the American people do not trust Barack Obama and have even less faith in the actions of Congress. The deficit of trust is so bad that only four in ten Americans would shake the President’s hand without examining it first and that drops to one in five if you are talking about a Congressman.

As the White House struggles to redefine the argument, they have obviously reached out to their friends in the Liberal Press. The real polls have shown that 60% of America wants no part of the Democrat’s healthcare plan so the media is now attempting to reverse those numbers by targeting poll questions to reinforce the President’s assertion that they simply didn’t explain it well enough. A recent poll conducted by Newsweek, or should I say “News-weak”, states that the 49% that oppose the healthcare bill virtually disappear as people were made aware of what the bill contains. By dissecting the bill and asking about individual components, they claim that their poll shows a huge increase in support for the individual provisions this bill would offer.

If News-weak were honest instead of engaging in a battle of semantics, they would have asked the real questions. How much are those provisions worth to you? News-weak claims that 81% support a healthcare insurance marketplace or “exchange” where individuals can compare plans and buy insurance at a competitive rate. What they didn’t tell the respondents is that current Federal Law prohibits insurance companies from competing across state lines. An Exchange would give us new insurance options but this plan requires an entirely new and extremely expensive Federal bureaucracy to do what the free market system could provide for free. Removing Federal roadblocks to insurance competition would give us all of those options without the additional burden of supporting a new Federal Agency.

They continue by citing that 67% thought healthcare insurers should be required to cover anyone who applies, including those with pre-existing conditions. That is doable provided you are willing to pay for a whole new type of policy. There is no other insurance on the planet that is expected to cover a pre-existent condition. Anyone that has collision insurance on their car knows that insurance companies require photographs of the insured vehicle to prevent people from filing claims for “pre-existent” conditions. You cannot purchase homeowner’s insurance after the flood has swept your house away and expect that your new insurance will somehow rebuild it for you. Auto and homeowner’s insurance pays one claim for one incident so health insurers are already providing far more coverage than any other type of insurance by providing on-going care for a chronic condition.

Once again, no one has come up with the dollar and cent’s comparison of what this new expanded coverage will cost. Some estimate place the increase at more than 100% over current premium costs. Are the currently insured willing to pay double for their healthcare plans if the government is given the authority to force insurers to cover pre-existent conditions for people that did not have the good sense to have insurance to start with? After all, we are talking about pre-existent conditions which means that they had the condition before attempting to purchase insurance.

News-weak also said that 75 percent of the poll respondents agreed with requiring most businesses to offer health insurance to their employees, with incentives for small-business owners to do so. Of course we already know, simply by looking at the unemployment rate, increased taxes and government mandates on business results in fewer employees. The healthcare plan currently being discussed is estimated to cost America another two million jobs if fully implemented; something that is bad for any economy and just plain insane is a recession. Large businesses have the means to outsource overseas, completely avoiding the mandates and small business incentives fail to sufficiently cover the actually cost of government requirements; so while the incentives look good on paper, they rarely have the desired results.

Since News-weak decided to use their slanted poll to insinuate that there is consensus support for key provisions within the healthcare bill if the public been adequately informed, they have provided me with the license I need to dissect their article and assumptions. My quick summary of the article is that in more than two-thousand pages of legislation, there are five key principals out of the eight that they detailed, that Americans can support provided you don’t tell them what it will cost them. Out of those five principals, only three were supported by a large enough margin to have been worthy of mention. The smallest percentage noted was 67% so we can safely assume the remaining two must have been over 50%, but not by much.

Nowhere does the article mention that support for these few principals had changed the respondents’ minds about their lack of support for the Democrat’s bill. Most of the legitimate polls I’ve seen show that there are several ideas that most Americans agree on but those polls clearly show that Americans want the current plan scrapped and new, bipartisan negotiations opened with these basic ideas included in the discussion. America has no faith that Congress can create an agency that can run our healthcare system better than the free market can and in fact, most Americans think that the Federal government will do a far worse job overall.

Of course, no News-weak article on healthcare would be complete without resurrecting the anger of last year’s town hall meetings. The News-weak article used to present their poll data included a photograph of an angry town hall participant from last summer complete with the caption “Town Hall Face - An unsightly condition caused by unsanitary health-care politics.” While they are trying to show would-be protestors how ugly that can look, for once they aren’t howling about the angry zealots disrupting the peace of public meetings. Instead they are following the lead of the President and Congressional Democrats; blaming the climate of anger on some phantom misinformation campaign.

This tells me two things. First, even News-weak has finally recognized that the opposition to this bill is far wider than originally thought and denigrating that dissent only angers the very people they are hoping to sway. Second, since there was no mention of the Tea Party, the tide might be turning for that movement, at least in the press. Now that Tea Party membership has swollen to more than fifteen million Americans, they are too large to be called a fringe group of right wing extremists. In fact, the newest membership demographics are showing some interesting trends. Independents and Conservative Democrats are aligning with Tea Parties all over the country as they become more disenfranchised by the Progressive movement within the “new” Democratic Party. Even the few remaining Congressional Democrats that still have some measure of self respect are distancing themselves from this dangerous radical ideology and are switching Parties or just leaving politics altogether.

The next few weeks will be extremely interesting. People are not buying the President’s promise of meaningful healthcare reform and Congressional Democrats might as well be selling “Snake Oil” for all the credibility they currently hold with the public. It is clear that the healthcare plan represents something far more important to Progressives than mere savings for Americans otherwise they would yield to public opinion and scrap this mess instead of risking wholesale losses in this November’s elections. The question that needs to be answered is the one that was not asked by News-weak; “Why is the President and the Progressive arm of the Democratic Party so obsessed with passing this bill?” As Shakespeare had written “Me thinks the Lady protests too much”. There is nothing in the bill to warrant this kind of devotion unless it is really just a spring board for the kind of reform the President wanted before his campaign began in earnest…a European style, single payer, government controlled Universal Healthcare System.

Paul

The Man of Change?

Well here we are just six days away from the much publicized summit on healthcare reform the President announced during the State of the Union Address. Some foolishly believed that his invitation to ranking Republican’s signaled his understanding of the message voters had sent in the New Jersey and Virginia gubernatorial elections and finally, the Massachusetts special election to fill Ted Kennedy’s Senate seat. Apparently that assumption was premature and the election of Republicans to all three of these vital races is being dismissed as easily as the town hall meetings and Tea Parties have been.

It is bizarre that the Democrats can be this blatant as to their intentions. Behind the scenes work to reconcile the Healthcare Bill is still progressing even as the President continues to at least say, that he wants the best ideas from both Parties. Harry Reid and Nancy Pelosi have both signaled their intention to “go nuclear” and rely on a reconciliation tactic to pass the bill with a simple majority, causing reasonable people to ask what kind of summit can this be if these negotiation are till taking place in secret and these kind of plans are being made before Congressional Republicans are even given the opportunity to present their ideas and compromises?

Scott Brown was not simply a message for the Democrats. His campaign was centered on the promise that he would be the 41st vote that would stop the race to pass a healthcare reform bill that the majority of American’s do not want. As support for the President wanes, the trust the American people have in the Democrat’s healthcare plan evaporates at an astounding rate. In recent polls, most Americans would prefer that the plan be scrapped and that the government turn its attention to the economy and the faltering job market.

Regardless of the loud and clear voice of the people, Congressional Democrats are standing firm because their President said they must move forward and also because the Progressive movement has been holding the Democratic Party hostage for decades. That is why Indiana Democrat Evan Bayh decided to throw in the towel and refuse to run for another term. He was bitter in his statements about the ineffectiveness of Congress and said that he could accomplish more as a private citizen than he ever could as a member of the Senate. Alabama Congressman Parker Griffith recently switched Parties for much the same reason. He joined the Republican Party because the Democrats under the Progressive assault had lost their way. They were no longer the Party of the people but some weird group of far left elitists that no longer cared to hear the people. That is why the President’s agenda is being propelled forward as the economy continues to crumble; they have been in effect, deafened by their own rhetoric.

To continue their push for healthcare reform and cap and trade they must convince you that the economy is already in recovery. As the President and the DNC struggle to convince people that the Recovery Act (Stimulus Bill) is working fine and has “saved or created” two million jobs, the U.S. Department of Labor’s own website says the job loss average for the past month has been 467,500 jobs lost in each of the last four weeks. Of course “saved jobs” is the new catch phrase since it is as impossible to disprove as it is to quantify. You know, that we might have even begun to believe some of that if Joe Biden hadn’t spilled the beans in an interview on Wednesday. As he spouted the administration line of “saved jobs” he added that the Recovery Act is a two phase program with the money for actual job creation loaded in the second half of the program. He explained that most of the funds spent in phase one had been targeted to offset the cost of State unemployment benefits and to provide tax relief.

Ok, I admit I’m a little confused here. The job creation funds have not been disbursed yet but the Recovery Act has already saved or created two million jobs? “Most of the funds spent in phase one were to offset the cost of State unemployment benefits and to provide tax relief” but the Recovery Act has already saved or created two million jobs? Is Vice President Biden saying that the act of collecting unemployment insurance is now considered a job? If so, is it a created job or a saved job? Maybe it’s both. If you had already been collecting benefits and are now drawing on an emergency extension then it is clearly a saved job but if you are one of the unfortunate 467,500 that are still losing their jobs every week; well, then that must be a created job.

All of this nonsense of saved jobs and created jobs flies in the face of the statements made by White House Economic Advisor Christina Romer in a Congressional hearing in October of 2009. Romer testified “Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009 and by mid-2010 fiscal stimulus will likely be contributing little to further growth.” Of course when the economy did not respond as hoped, Romer was obviously asked by the White House to revise her assessment. While recently appearing on the February 17th edition of Good Morning America, Romer said in response to questions about the economy that the greatest effects of the Stimulus Bill have yet to be realized.

The inconsistencies aren’t something shocking. In fact, this administration is amazingly consistent in its inconsistency. If you speak with five different people in this administration you will get five different numbers of the jobs the stimulus bill has “saved or created”. What doesn’t change is the mindless defense of the actions they have already taken or are hell bent on passing into law. Regardless of every possible economic index you can look at, the stimulus bill is not only a failure but has resulted in a “job deficit” as the economy fails to respond. What they absolutely refuse to see is that they can have another five stimulus bills of equal amount and still not create lasting private sector employment. Business is not responding because as this administration continues to apply its short term fiscal Band-Aid, the threat of future tax hikes and new regulations are still part of the overall plan.

The Healthcare Bill is just one of those black holes that are making businesses apprehensive. We still don’t know what is being crafted in the dark up on Capitol Hill. What will the tax liability be? At what income level does it begin? How many employees can I have before the mandate to provide coverage hits me? Will the plan I already provide have an additional tax levied against it? How can responsible business owners make a decision to hire additional employees until they know if they can even remain profitable after the Bush tax cuts expire and the capital gains tax go up in 2011?

Cap and trade, if passed, will increase energy costs by 65% in the first few years and more that 100% by 2015. The only thing that has allowed American businesses to remain even marginally competitive against nations that pay their employees five dollars a day is affordable and abundant energy. Proponents of cap and trade claim the difference is pennies a day but California has already installed Smart Meters, a major component of Smart Grid, the key to cap and trade. California energy costs to PS&G customers have skyrocketed and they are ready to revolt at the increases they are experiencing. Bear in mind that the cost of purchasing carbon credits to produce their electricity aren’t even part of that increase yet. That is where the real kick in the pants will come from. There are estimates that claim cap and trade will cost America five million jobs or two jobs for every so-called “green job” it creates. Looking at Spain, I think that estimate is conservative if not overly optimistic. Spain was suckered into the whole plan of creating a green economy that Obama is trying to sell us and unemployment in Spain has already passed 19%.

So where is the change? The actions of this administration are bordering on criminal; there is no transparency other than a few carefully orchestrated photo ops and the President has broken every promise he made during his campaign. The legislative process itself has been hijacked by Progressive radicals and special interests and even Obama’s friends in the Community Organizing business have been writing key parts of costly legislation that Congress won’t bother to read before passing. If Progressive Democrats continue to ignore the impact their plans are having on the economy and force healthcare through while unemployment is still close to 10%, the backlash will cost them both the House and the Senate in 2010. The damage they are doing now has already insured a long and hard road to recovery and the measures that will have to be taken to right the wrongs will be painful and unpopular. I can only hope that the American people will wean themselves from the public teat so we can actually address the spending problems in Congress before the world economy forces even more drastic change against our will.

Paul

A Constitution Beyond Interpretation

In a flight of fancy we are discussing an America that has taken a slightly different path. What if the Founders included a basic list of definitions as an appendix to the Constitution; definitions that eliminated any possibility that the true meaning of the Constitution would ever be subject to interpretation? That would give us a Constitution that would remain intact unless altered by the rigorous and prescribed method of amendment that the founders intended. This would have insured that the Constitution would forever remain the rigid armature of the Republic while retaining the ability to remain dynamic in response to an ever changing world.

Those definitions would have made a world of difference. If we research through the Federalist Papers, the founders had enunciated their ideas quite clearly and their intentions are well known even today. Unfortunately, legalists have chosen to ignore that treasure trove of information simply because those intentions were never actually written into the Constitution. The Constitutional scholars have spent nearly as much time navigating between each word of the Constitution to justify alternative law as they have learning the law itself. Just as a worm would weave in and out of the garden soil, these lawyers have laced the Constitution with holes of nothing but semantics; skirting the truth to inflict their own mark upon society.

Roscoe Pound devised his theory of sociological jurisprudence and legal realism at the turn of the 20th Century. Sociological jurisprudence is the school of thought that allows the interpretation of legal language and therefore laws, in contemporary terms. Through sociological jurisprudence, one could alter the law without actually having to go through the legal wrangling of convincing lawmakers to rewrite it. A perfect example of the modern use of sociological jurisprudence is the Constitutional authority to “Regulate” commerce. To regulate, at the time the Constitution was drafted, simply meant to make regular or to make uniform. It was meant to enhance commerce between the states through a uniform standard of currency and through trade laws that would make commerce between any of the states fair and equitable. As time passed, the word “regulate” slowly had additional meanings applied to it including “to license, oversee or control through regulation”. Since the word “regulate” had assumed multiple meanings and there was no clear definition in the actual Constitution, the entire commerce clause was left open to interpretation using any one of those definitions.

Of course we know that today the United States Congress has made a mockery of free trade through their liberal interpretation of the “Commerce clause”. The regulation that Congress prefers is of course, the use of governmental regulations to control, tax and license interstate commerce. FDR used this clause liberally to affect government control of nearly everything during the Depression, including the growth of farm products for personal consumption. Not because that produce was marketed across state lines but because produce grown for personal consumption “may” have an affect on the interstate value of produce if too many people began growing their own food. It was a clear stretch of the imagination and something that would not have been possible without the legal tinkering of one Roscoe Pound.

Pound’s other assault of “Legal Realism” postulated that since man was flawed, that any law written by man was potentially flawed as well. For the first time, the Constitution was under scrutiny; not because of the word of the law and not by using the volumes of information contained in the Federalist papers that spoke not only about the Founders intent but of their character as well. Now the Constitution could be examined based on the sheer speculation that the law possibility contained motives of greed and avarice; that the founders had laced their own interests into the original law and that made modern interpretation a guild-edged priority. For his legal genius, Roscoe Pound was decorated; not by the United States, but by Nazi Germany for giving them the tools they needed to get around some very sticky laws of their own. The real danger in these theories is that the interpretation is left to those in power. Since power is corrupting, these little gems could be used by those in power to justify nearly any action; especially if a crisis warranted the declaration of a state of emergency.

FDR had ascended to the Presidency during the Great Depression in 1933. There is no doubt that this was a time of crisis, even national emergency. Jonathan Alter is a columnist and Senior Editor for Newsweek Magazine. In “The Defining Moment”, his recent song of tribute to his hero, Franklin Roosevelt, Jonathan Alter claims to have made an historical find. He states that in 1932, members of FDR's inner circle had urged the new president to deputize the American Legion. The only purpose Alter could arrive at was for the creation of some form of private army. In prepared remarks to be delivered to a meeting of the American Legion which was also broadcast as his first radio address after his inauguration, FDR was to tell the assembled veterans, "As new commander-in-chief under the oath to which you are still bound, I reserve to myself the right to command you in any phase of the situation which now confronts us." In fact, during his inaugural speech, FDR said quite clearly that he was ready to “assume extraordinary powers if Congress failed to act against the emergency”. This shocking revelation was met with thunderous applaud by the assembled crowd.

Alter's interpretation is entirely plausible for any number of reasons, including FDR's determination to use the World War I-era Trading with the Enemy Act as the legal justification for assuming emergency powers. A memo written at the Democratic Convention by Hugh Johnson, the future head of the NRA (National Recovery Administration) suggested that the entire Congress and Supreme Court be sent into temporary exile while a dictator set the country straight. Liberal Journalist and FDR advisor Walter Lippmann cautioned FDR about the state of the nation and urged him to assume "dictatorial powers." Fortunately for us, Roosevelt recognized that once those steps were taken, the American Constitutional government could never again, emerge intact.

Alter would have praised FDR regardless of what he had found but this time he was on the right side of the issue. Alter’s praise was for the man that resisted the call to assume such awesome powers. Not that it wasn’t tempting for Roosevelt, it was. Having seen the amount of power Roosevelt harvested using the legalist tactic of sociological jurisprudence, he came close enough as it was. Incidentally, I find it ironic that FDR was the descendent of another noted person in history. I don’t mean Theodore Roosevelt; that would be too easy. I mean another relative of great ambition, Benedict Arnold.

Seeing the fragility of the Constitution when it is allowed to be subject to such broad and yes, subjective interpretation, perhaps it is time that the definitions that are so obviously absent in this document are finally added so that we can read it in the context that the founders intended. The Federal government would be responsible for the defense of the United States against foreign aggression. We would not be engaged in “nation building” nor would we enter into wars that were not in direct defense of American territory, resources or vital interests. It would insure that trade between the States was free of corruption and that business between the States is conducted with a uniform currency and a uniform code of laws to insure ethical business practices. It would arbitrate disputes between the States and enforce the Constitutional laws that all States agreed to when they entered the Union. The Federal government, as now, would enter into treaties with foreign powers provided the treaties are ratified as prescribed in the Constitution.

Since the States retained all rights of self governance excluding the enumerated powers granted to the Federal government; there would be no Federal agencies for education, health and human services, labor, environmental protection, social security, agriculture, international development, on and on and on. The complete list can be found here and I strongly suggest you take a look at it since you probably have no idea half of these even existed: http://www.usa.gov/Agencies/Federal/All_Agencies/index.shtml

Fear not, the elderly would not perish in the streets, the lakes and streams would not become acidic and disease would not race through the streets. With Progressives, Socialists and extreme Liberals handcuffed by a strong Constitution, the States, being free of oppressive Federal mandates would begin to flourish. The agencies that wastefully consume so much of this nation’s wealth would be gone, freeing that money for economic expansion. Local economies would finally possess the means to provide the services that their residents feel strongly enough to approve through their electoral might. Good ideas never remain hidden or stagnant and as the States test those ideas, the best ones would rise and be sought by the residents of other States. Instead of a one size fits all Federal mandate, States would adopt programs at their own discretion that are tailored to their special needs. Best of all, the people of each State would retain direct control over their destinies instead of being saddled with national burdens imposed by the overwhelming number of number of Congressional representatives from California, Illinois, New York and Florida.

Paul

A Constitutional Government? What a Concept!

Let’s play a game! I’d like to pretend for a moment that the Progressive movement doesn’t exist; that the subsequent Liberals never discovered Karl Marx or Friedrich Nietzsche. Let’s imagine an America where we had the foresight and courage to block Soviet Russia’s attempts to demoralize America by infiltrating the American press, film industries and educational systems. Let’s ponder the future as if our past had followed a course that more closely resembled the government our founding fathers had meant for us to have. Before we can actually play that game, we must start at the beginning with a review of what that government was supposed to look like. Only then can we remap the last two hundred years and perhaps, speculate on the next two hundred.

The people that founded the American colonies were for the most part, British émigrés, people that sought to escape religious persecution or leave the crowded streets of England’s urban centers and seek new fortunes by settling a vast, new and relatively uninhabited land. There were spacious tracts of land and seemingly limitless resources to be exploited by adventurous men that were fit and industrious. Living in a pre-industrial, agrarian world, uses for many of the “new world’s” resources were still largely unknown but they would certainly come into play later. By the time the British colonies were firmly established in America, the Spanish myths about cities of gold had been disproven and fur trade, fertile lands and natural ports were considered to be America’s greatest assets.

While many still traveled back and forth to England, the American born descendants of the original settlers had mostly taken their father’s places by the turn of the 18th Century. They were beginning to create an identity separate from their British heritage mainly because the British Crown treated them as second class citizens. England had fought several skirmishes with Spain since the inception of the colonies and was actively sparring with France on the borders of the American colonies by the time the mid 1700’s had arrived. England had stationed a number of troops to guard the colonies against French incursion but the British Treasury was under pressure and the cost to maintain a protective force in numbers was becoming prohibitive. The English population was already overtaxed and on the verge of revolt so England turned to her second class citizens in America to carry the financial burden of her own protection.

For many, it may seem proper that the beneficiaries of that protection should pay for it but this story could not be written if Britain had not taken that principal too far. Strict limits were placed on the manufacture of American goods so that British made goods would still be in demand. While one new tax after another was levied on colonial trade, the colonies were continually denied the representation in Parliament that British citizens had enjoyed for centuries. The troops sent by England to guard the colonies were slowly assuming the duties of suppressing the anger that was slowly brewing against the unfair restrictions and tariffs. The troops themselves became the center of the controversy as colonists were forced to house and feed the soldiers at their own expense.

All of this would boil over into open insurrection and finally result in a bloody revolt against British rule. The Declaration of Independence would have had no more historical significance than an advertising poster for fertilizing manure had the colonies not defied all odds and emerged victorious. With their independence from England, the colonies would use their proclamation of natural rights and the list of grievances in that declaration to create an entirely new form of government.

The new government would be founded on the principal that man’s fundamental rights descended directly from God and were irrevocable; that these rights had always existed and were not an act of kindness granted by a beneficent government. The basic structure of the government they created borrowed the most historically successful parts from a variety of cultures. It would contain a body of civilian representatives as found in the British Parliament; a Senate as found in the Roman Empire and a democratically elected leader as part of the experiment. All of these would be restrained by law and for the first time in the history of the planet, the word of law shackled the reach government and the citizens retained supreme rule over all of it.

Central to the formation of the new government was the principal that the States remained sovereign and self governing. The Constitution created a governing body that would unify the States while each retained autonomy and that would not be an easy trick. They achieved this through a “bottom up” strategy. The people retained direct control over State government through the electoral process and the State would govern its citizens by laws enacted with the consent of the governed. The individual States would freely enter into a Union of States whose governing body would be comprised of elected representatives from each State and a President elected by the citizens of all of the States in the Union. It would be a Republic, with the electorate selecting representatives based on their principals and those representatives would vote for or against legislation on their behalf.

Each State would have to agree to abide by the United States Constitution in order to enter the Union. The Constitution is a document that not only reaffirms the State’s sovereign rule but clearly defines the powers that the States would delegate to the Federal government; strictly limiting the Federal government to those powers alone. As part of the Union, the States would agree to obey the laws passed by the Federal government so long as those laws pertained to the responsibilities delegated to the Federal government by the Constitution. A Supreme Court was established that would rule on any Federal law that was challenged by a State or citizen that could prove harm.

Curiously, the Bill of Rights were added as the first ten amendments to the Constitution and not written into the original document. It is not that the Founding Fathers considered those rights as an afterthought; indeed they considered those rights supreme. They did not add them because they did not feel they embodied the Federal government with any power sufficient to threaten those rights. We now know the confidence they had in the Constitutional limits placed on the Federal government was overstated and the Supreme Court spends much of its time hearing cases surrounding those sacred rights. While visionaries, the Founding Fathers saw that power is corruptible and did the best they could to see that the Federal government was correctly restrained. What they did not envision were the future generation of Constitutional scholars dedicated to finding pathways around those restraints and that would inevitably bring us to a point where the Federal government it threatening to become the master and not the servant of the people.

The Founding Fathers were geniuses but alas, they were still mere mortals. If they possessed the powers of clairvoyance perhaps they could have avoided the mess we are in today with a simple table of definitions added as an appendix to the Constitution. That would certainly have taken the wind out of the sails of those prominent Constitutional lawyers and closed the loopholes that they are now driving trucks through. Those definitions already exist in the Federalist Papers, a series of letters and correspondence penned by the founders that clearly detail their intent and place the language contained in the Constitution in context. Unfortunately, since those letters are not part of the actual Constitution they bear no weight in the actual review of the law as it is written. Armies of legalist attorneys now argue each and every word written in the Constitution and assign modern interpretations that shatter what were once considered iron chains on the power of the Federal government.

Tomorrow we begin our experiment in earnest. We will imagine that the Founders did include that table of definitions in the actual Constitution and that there is no longer any question as to the role of the Federal government. Make sure you wear a helmet and elbow pads because it’s going to be one hell of a ride!

Paul

Obama's Recession

Any discussion about who is ultimately responsible for the recession would not be complete without a clear definition what a recession is. In economics, a recession is a business cycle featuring a general slowdown in economic activity over a period of time; usually two fiscal quarters or longer. The other criterion for identifying a recession is an increase in unemployment of greater than 1.5%. It is clear based on the generally accepted criteria that the recession began under George Bush with the third quarter of 2008 showing a 2.7% decrease in GDP and the decline jumping to 5.7% in the forth quarter of 2008 and a corresponding increase in unemployment from 5.8% to 7.2% over the same period.

Except for the last two quarters of 2008, unemployment during the Bush administration had cyclically fluctuated between four and six percent just as it had during most of the Clinton administration. Clinton stepped into office with unemployment at 7.3%; remaining at or near that level until October of 1993. Of course the banking system was still generally believed to be in good shape then and since we found out that most of the deregulation that nearly collapsed the system had not occurred yet, it probably was. I find in curious that the real reduction in unemployment during the Clinton years did not take place until he abandoned his plans for healthcare reform. Apparently, the business community had the same reservations about the future of their profitability with Clinton-care as they do with Obama-care. While Clinton did not lower taxes, his advisors did convince him to reduce the capital gains tax and that made the risk of investment more palatable.

Obama has not enjoyed a reprieve from high unemployment because the threat of his agenda has kept the business community from investing in labor or expansion. The measly incentives he proposed to help small business during his State of the Union Address lost weight and credibility when juxtaposed against his assertions in the same speech that he intended to follow through with healthcare, cap and trade and the hair-brained scheme of debt forgiveness for student loans for anyone that could avoid paying them for twenty years (ten, if you were employed in the service of the government).

There is nothing in the President’s agenda that does not take from those that earn wealth only to be given to those that don’t and that is what is killing new job creation. In fact, it took all eight years of the Bush administration for unemployment to rise 3%; Obama nearly achieved that in his first year in office. The President may have inherited a large national debt, high unemployment and a sagging economy; but he did not inherit the agenda proposals that have made all of these indexes far worse. That agenda is all his (or at least, it belongs to whoever is pulling his strings).

For all the damage that his proposals have wrought on the economy and no matter how many people tell him that this is what has stalled business, he still intends to follow through. I haven’t decided if that is just stubbornness on his part or if these are the marching orders from his number one White House visitor, Andy Stern. I think it is fair to question his motives and when you follow the money and the intent of the people that are pressing heavily for these socialist programs like Andy Stern, some interesting things happen.

Obama has recently made some very impassioned speeches where he says that he promised healthcare would pass and that is exactly what he is going to do. Well, he promised to close Guantanamo Bay in the first year and it is still open. He promised transparency in his administration; that healthcare debates and meetings would take place on C-Span. Not only have the meetings on healthcare barred C-Span coverage but congressional Republicans have been barred as well. He said there would be no more back room deals and then offered $300 million to Mary Landrieu for her vote and only God knows how much for Ben Nelson. Bernie Sanders got billions for community health services but in all fairness, that was to expand national programs and not just those in Vermont. All of that money and more had been handed out in closed door, back room deals.

Obama also said there would be no middle class tax increases. Those of us that watch this nonsense knew that was a lie of semantics from the start. His plans and programs, not to mention the FY2011 budget, call for a whole host of new taxes on goods and services; taxes that will be passed on to you by the businesses they affect. He could stand firm on his promise of not taxing you directly while taking it from business knowing they were taking it from you. Now apparently he is going to make the same mistake George H.W. Bush made. Remember “Read my lips – no new taxes”? Bush reneged on that and Clinton never let you forget it during the campaign.

Now that Obama has blown through four years worth of Bush deficit spending in his first year in office, the nation is crying for fiscal conservatism. Fiscal conservatism for most of us in this country means cutting spending to live within our means. For a tax and spend Progressive, fiscal conservatism means making sure you have enough tax revenue to cover your planned spending. It was announced this week that the President is considering a middle class tax increase now that the Congress has passed “Paygo”. Paygo simply means Pay as you go; a mandate that Federal spending increases have to be offset by a decrease in spending elsewhere or an increase in taxes. So now, in a recession, the President wants to tax the middle class twice; once directly and then again by turning overtaxed businesses into tax collection middlemen. That is why they are trying to sell us on the notion that the recession is finally easing.

There was a modest gain in GDP and a slight easing of unemployment last month. Both of which are easily explained by the billions spent in stimulus money and the increase in government employment as they ramp up for the 2010 census. Neither of these small increases are the result of real economic growth and neither will be lasting. So now that he is planning to raise taxes to show his fiscal conservatism, where are the corresponding spending cuts? Well, the President of semantics has the answer to that too. He increased discretionary spending 25% in 2009 and will add another 20% in 2010 but he promises to freeze discretionary spending in FY2011. Mr. President that is not a spending cut; that is freezing your insane increases so they can’t be cut.

Early in the Twentieth Century, America had a similar crisis. After World War I, America was faced with a deep recession brought on mostly by huge increases in the personal income taxes imposed to pay for the war. By 1920 we had slipped into depression and unemployment had topped 12% but unlike this President, the drastic steps that were needed were actually taken. Congress halved government expenditures and slashed taxes to nurture the economy. The result was a period of unprecedented growth not seen since the creation of America and that brought the country out of depression within two years when unemployment had dropped to just over 3%.

Until there is a recognition that government is the problem and not the solution there will be no meaningful progress in spending cuts, debt reduction or economic development. If there is ever going to be an epiphany in Washington on this, it certainly will not begin with this President. If America can elect a Congress this November that can put an end to Obama’s agenda that will be a good start. They might even be coerced by an active and involved electorate to propose legislation to finally restrain the wasteful ways of Washington. The bad news is that unless those daring individuals are elected in numbers sufficient to override a Presidential Veto; that new legislation will have to wait until a responsible President can be elected in 2012.

None of this would be needed if Washington actually obeyed the Constitution and had not ignored the Tenth Amendment for the past hundred years. Tomorrow, we will discuss what our government would look like if we had a Federal Government that actually resembled the intentions of the founding fathers.

Paul

Obama Didn't Inherit the Recession - He Hired It

In continuation of Friday’s article, we were discussing whether or not the Obama administration could continue to call this recession the “Bush” recession. The answer is no and the Obama administration has to face the fact that the statute of limitations for blaming Bush has run out and he now owns the economy; especially since his administration has already used all of their “Ivy League” experimental theories to correct it. As much as they would like to enter the 2010 campaign cycle with as much emphasis as possible on the “mess” that Obama inherited, there are several of those pesky little facts out there that all of Obama’s rhetoric will not change. As it turns out, Obama didn’t just inherit the recession, he hired it.

#1- President Obama has retained people within his administration that were previously key policy makers whose actions contributed to the current recession.

#2- Much of the small business community has sited major parts of Obama’s agenda that have shaken the confidence of business in the health of the economy under Obama’s leadership and in their ability to remain profitable should those agenda items become law.

#3- The actions taken by this administration to correct the faltering economy were, and continue to be, centered on government control, government spending, and the monetization of debt complicated by the dangerous misreporting of economic indicators.

We already discussed Tim “Turbo-Tax” Geithner, Obama’s current Treasury Director; specifically how his actions while he was Chairman of the New York Federal Reserve and a member of the Washington “Group of Thirty” have been considered by many economists as directly impacting the economy in ways that have severely damaged the banking industry. We also discussed that Rahm Emmanuel, Obama’s current Chief of Staff was on the board of Freddie Mac during the period that Freddie Mac was plagued with scandals involving campaign contributions and accounting irregularities. Obama torpedoed a Freedom of Information Act request to obtain communication and e-mail records that might have helped an investigation implicate his dear friend and Chief of Staff.

Let’s talk about some new people. Barack Obama’s choice for Director of the Office of Budget and Management (OMB) is Peter “Loverboy” Orszag. If you recall, the OMB gave the Senate Healthcare Bill a failing grade on maintaining the “budget neutrality” that the President required of any bill he would sign. Of course a quick closed door meeting between Obama and his Budget Director fixed that and within days, the OMB reevaluated the plan and Viola! It was budget neutral! Thank God for Orszag! It is critically important to economic recovery that the business community can trust the estimates of government. After all, to be able to expand and chance the hire of new employees, business must be able to accurately estimate little things like future tax liabilities and the burden that new regulations will have on the cost of manufacture, labor and energy. Can you imagine if people began to mistrust the government; especially in the area of official reports and estimates? The ramifications would be astounding. Why you could dump hundreds of billions into the economy and never create a single job!

Orszag is another one of those intellectual theorists that has never held a real job. While he was not a “Rhodes” Scholar like Bill Clinton, he was a Marshal Scholar and after earning a degree in economics from Princeton, Orszag traveled to England where he obtained his Masters Degree and Doctorate in economics from the London School of Economics. He sites several people that he considers “Mentors” including Joseph Stiglitz. Stiglitz was not your average apple pie and baseball American and was himself, a proponent of globalist economic policy, market socialism and what he called a “more sustainable and just global economic order”. In addition to Stiglitz, Orszag also considered Robert Rubin an important influence in his life.

Yes, that is the same Rubin that spent 26 years at Goldman Sachs as a board member and Co-Chairman before joining the Clinton administration as Assistant to the President for Economic Policy. After leaving the Clinton administration, Rubin became Director and Senior Counselor of Citigroup and would eventually serve as interim Chairman between November and December 2007. In January of 2009, Citigroup announced his resignation after having been criticized for his performance. Rubin became one more name on the list of individuals that had brought the financial system to ruin before leaving with more than $100 million dollars in cash and stocks.

The current Director of the White House's National Economic Council for President Barack Obama is Lawrence Summers. “Larry” began his academic career at MIT where he studied physics but soon switched to economics, earning an B.S. in 1975. He attended graduate classes at Harvard where he earned his Ph.D. in 1982. At age 28, Summers became one of the youngest tenured professors in Harvard’s history. Like Orszag, Summers is a theoretician when it comes to work and has spent his life either teaching, in government or governmental organizations like the dreaded World Bank. While all of that sounds impressive, I still don’t know how we let people teach what they have never been involved in….like where business actually fits into a market economy. Summers early career was as an “academic economist” and he was responsible for providing research data for economic studies.

As a researcher, Summers has made important contributions in many areas of economics, primarily public finance, labor economics, financial economics, and macroeconomics. Some of Summers' early papers concluded that corporate and capital gains taxes are an inefficient form of taxation. Cutting the capital gains tax rate, Summers found, could help the economy grow. One of Summers' prominent findings in labor economics is that unemployment insurance and welfare payments are a major contributor to unemployment, and therefore should be scaled back. Since the Obama administration has taken a course contrary to these proven economic strategies, it is apparent that Larry’s career in politics and as a professor at Harvard, has caused him to trade his lust for truth for the comfort of being part of the ruling elite.

Of course there is a down side to losing your “religion” and Summers would find out that when you ignore what you know is right and true because it is unfashionable, bad things are bound to happen. As Treasury Secretary, Summers led the Clinton Administration's opposition to tax cuts proposed by the Republican Congress in 1999; a 180 degree reversal from the data he provided for other economists earlier in his career. Summers supported the Gramm-Leach-Bliley Act in 1999, which lifted more than six decades of restrictions against banks offering commercial banking, insurance, and investment services (by repealing key provisions in the 1933 Glass-Steagall Act). After passage, Summers announced: "Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the 21st century," "This historic legislation will better enable American companies to compete in the new economy. Unfortunately for Summers, the deregulation under the Glass-Steagall Act is widely known to have created the conditions that directly led to the sub-prime mortgage crisis; the precursor to the financial meltdown of 2008.

Summers also testified before Congress that there was no need to require additional regulation of the institutional OTC derivatives market, a move that would later lead to the near collapse of AIG. The work that Summers did for the Clinton administration in fact, created the conditions that would nearly drive the nation into depression a mere ten years later. Upon leaving the Clinton administration, Summers became the President of Harvard University. He decided to invest University funds using the loopholes he created through deregulation. Of course interest swaps and hedge funds can’t be maintained forever and his financial wheeling and dealing would end up costing the University over $1 billion dollars and cost him his job, forcing his resignation in 2006.

Now the Obama administration is shaping the financial direction of the nation under the advice of the actual architects of the financial meltdown that nearly bankrupted the entire financial system of the United States if not the world. One could argue that the Bush administration should have taken reasonable steps to restore the needed regulations which could have prevented the crisis and he probably would have if his administration hadn’t received the assurances of the Federal Reserve and Congress that everything was fine.

So in summary, the Obama administration is blaming the Bush administration for a recession that was brought on by financial deregulation enacted by the Clinton administration under the advice of people that Obama just rehired to direct the financial direction of the country under his administration. The question that remains unanswered is why Obama thinks that any of this is a good idea.

Paul

Is it really Bush's Economy or Obama's?

The New York Times inadvertently validated my assertions that Republicans would be wise to recognize the anti-incumbent fever sweeping the nation but in order to keep their credentials as a liberal member of the Robert Gibbs Propaganda Club, found it necessary to embellish the story with their own pro-Obama flavor. The Times reported that a recent Times/CBS poll shows the President with an edge over Republicans in the upcoming election, totally missing the point. All of Congress is entering the election cycle with its lowest approval rating ever and that should be hard to ignore unless of course, you have the additional armor of being the Liberal media’s intellectually elite shock troops.

Of course the poll was crafted in such a way that you had to agree that Bush was totally at fault for our current economic woes; exonerating the President from all responsibility. I will be the first to admit that Bush’s economic strategies were an abject failure and while he was tough on terror, he was no better than a run of the mill, liberal spending Democrat when it came to economic and public policy. What the poll ignores is the duplicity of Obama’s closest advisors in perpetuating that failure which deepened the recession.

It began with the appointments to his cabinet. Tim Geithner had studied international economics in college and his early career placed him in the International Affairs Division of the U.S. Treasury and as an attaché to the United States Embassy in Tokyo. He was also deputy assistant secretary for international monetary and financial policy, senior deputy assistant secretary for international affairs, assistant secretary for international affairs and the Under Secretary of the Treasury for International Affairs.

One would think that resume would have qualified him to be Obama’s Secretary of the Treasury but there are some disturbing issues hidden in his resume too. In 2002 he left the US Treasury to join the Council on Foreign Relations as a Senior Fellow in the International Economics department. He was also the director of the Policy Development and Review Department at the International Monetary Fund; an organization that rarely has the economic interests of the United States at heart but instead, finds itself regularly aligned with the United Nation’s desire to redistribute the wealth of Western democracies to developing nations.

The friends (and enemies) that Geithner made while traipsing around the world seems to have shaped quite a few of his views and it is his “citizen of the world” mindset that made Geithner necessary to Obama’s cabinet. While going through the confirmation process it was found that Geithner had some tax “difficulties” of his own and he dismissed those difficulties, blaming his lack of expertise in using the personal tax preparation program “Turbo Tax” for the discrepancies. Really? A man studied in international economics that just happened to have an early career in the Treasury Department couldn’t figure out how to use a $19.95 computer program to pay his taxes? Well, the Senate bought that excuse so I will let that rest. Not because I believe him, but because there are bigger problems with Geithner than that.

Geithner was President of the New York Federal Reserve in 2003 and Vice Chairman of the Federal Open Market Committee component. In 2006, Geithner became a member of the Washington financial advisory panel “The Group of Thirty” where in 2007, he worked to reduce the capital required to run a bank. Do you see a red flag there? Geithner also arranged the rescue and sale of Bear Stearns and also supported his friend and Goldman Sachs CEO, Henry Paulson, in his bid to promote the bailout of AIG. While billions in taxpayer funds were flowing into Bear Stearns and AIG, Geithner curiously ignored Lehman Brothers, letting them slip into bankruptcy. But hey, friends are friends and all that. The bottom line is that there are number of private economists that say Geithner’s actions severely damaged the United States economy while he played fast and loose with taxpayer funds; favoring friends and destroying enemies.

If that isn’t bad enough, we have Rahm Emmanuel. Emmanuel is noted for having an explosive temper that manifests itself in ways that could be considered damaging for a White House Chief of Staff. Emmanuel had worked on a number of Democratic campaigns including the Presidential campaign of Bill Clinton. While working on the Clinton campaign, he reportedly sent a dead fish in a box to a pollster that was routinely late in providing much needed poll results. In another incident after the 1996 election, Emanuel was so angry at Clinton’s campaign enemies that he stood up at a dinner with colleagues from the campaign, grabbed a steak knife and began rattling off a list of what he considered traitors, shouting 'Dead!” and plunging the knife into the table after each name was called out. It sounds like Rahm’s parents let him watch way too many violent movies as a child.

Unlike many of his current colleagues, Rahm Emmanuel actually had a real job before entering politics and the seedier world of investment banking. Unfortunately for Rahm, his job at a Chicago Arby’s ended suddenly when he lost part of his finger in one of the machines. Considering Geithner’s qualifications as Treasury Secretary include imploding the US Economy as head of the NY Federal Reserve, I am really surprised that Emmanuel wasn’t named to head OSHA or the Department of Health and Human Services; especially when considering his impeccable safety record. However, it is Emmanuel’s cut-throat Chicago style of politics that is the real criteria for his position as Obama’s Chief of Staff. As Chief of Staff, he is one of the orchestrators of the administration’s “blame Bush” campaign and one of the crafters of the Obama “evil greedy banker” policy. He should know; after all, he was an evil greedy banker himself.

Rahm Emmanuel was an advisor to Bill Clinton; a position he resigned from in 1998 to pursue a career in investment banking with Wasserstein Perella. In his two and a half years at Wasserstein Perella, he earned a reported $16.2 million dollars. As an additional favor to his friend, President Clinton named Emanuel to the Board of Directors for the Federal Home Loan Mortgage Corporation ("Freddie Mac") before he left office in 2001. Emmanuel’s position earned him at least $320,000, including later stock sales. Obviously a political appointment, Emmanuel was not assigned to any of the board's working committees; a Board that met no more than six times per year.

During Emmanuel’s time on the board, Freddie Mac was plagued with scandals involving campaign contributions and accounting irregularities. Imagine that? The Obama Administration subsequently rejected a request under the Freedom of Information Act to review Freddie Mac board minutes and correspondence during Emanuel's time as a director. The Office of Federal Housing Enterprise Oversight (OFHEO) later accused the board of having "failed in its duty to follow up on matters brought to its attention." Thanks to Obama’s stonewalling of the Freedom of Information Act request, we will never know the depth of Rahm Emmanuel’s participation in those scandals or how much his actions may have damaged the fiscal stability of Freddie Mac. We can only assume that if Obama’s friend and Chief of Staff were not implicated, that the FOI request would probably have been granted.

Emanuel resigned from the board of Freddie Mac in 2001 when he ran for Congress; eventually filling the seat vacated by another Chicago criminal, former Illinois Governor Rod Blagojevich. Blagojevich is currently on trial for Federal Corruption charges stemming from an investigation that alleges that he (Blagojevich) tried to sell the U.S. Senate seat vacated by Barack Obama when he became President, for cash or favors. Emmanuel kept his Congressional seat until his appointment by Barack Obama to the position of Chief of Staff.

The part that I cannot figure out is how this administration claims insulation from the current financial crisis when so many of Obama’s key appointees played major roles in bringing about the near collapse of the economy? Factually, if the Democrat controlled Congress that Bush was plagued with from 2006 forward, had actually performed their required function of providing oversight for the Federal administration structure, perhaps corrective action would have been taken by Bush that could have mitigated the economic implosion of 2008. Like I said before; friends are friends and enemies are enemies and the Democrats in Congress would have had to crucify some of their own to do that and there was no need to sacrifice them if you had a Republican President you could blame instead.

Monday – Why hasn’t the economy shown signs of recovery? The truths Obama can’t blame on Bush.

Paul