Taxageddon, Some History

Taxing Times, and That Ol’-Timey Liberal Religion | Power Line:

Naturally, liberals are apocolyptic over the tax bill ... anything that has even a TINY chance to allow people to keep more of their own money is "the end of the world" to liberals. This Forbes article claims that the bill is "The End of Economic Sanity in DC"  ... assuring us that there HAS been "economic sanity in DC" in the past and "this time it's different" ... ho hum.

A tax form that says "list your income" with a command to "send it in" (for people that make "more" than a given liberal of course!) is the only tax plan they MIGHT find "fair" ... until they start taxing "wealth" while you are still alive at least.

I happen to be reading "The Age of Reagan" right now and as luck would have it, just read past the quotes in the attached column -- they say history doesn't repeat itself, but only "rhymes". This one seems closer to a repeat to me! The following is a good quote from the linked, and the linked is well worthy of reading.

Liberal rhetoric on the issue is revealing. Allowing people to keep more of their own money was called “showering money on the rich,” as though all wealth belonged to the government rather than the people. If not outright egalitarianism, the Democratic attitude is at least rooted in a distributionist fallacy—the idea that wealth is distributed, mostly by government, rather than earned by individuals and apportioned by markets ...

I'm not going to do a ton of work and link everything, but these figures are mostly from my usual sources -- CBO, Wikipedia, etc.

Obama  YEARLY deficit 2009 $1.4 T, 2010 $1.3T ... the "stimulus" was spent on things like Solyndra, sending something like $30 B largely to democrat run schemes that knew how to write "green" on a piece of paper. The D's took over congress in '06 and it was downhill from then on.

Over his term, Obama added $10 T to the debt, W added $5 T , and the rest of US history (pre-BOistan) added $5T in over 200 years. If Trump adds less than $20 T on his own, he will be doing "better" by recent standards in which each succeeding president doubles the debt!

As the media and your lefty friends go nuts over the "massive increase in debt", just remember the BO cliff! All that is being discussed here are the question of the pitch of that far right of the chart based on TWO elements of which GDP growth is actually the major one. CBO policy counts all tax changes as economically neutral -- tax increases never decrease GDP, tax cuts never increase it ... even though both typically happen, in order to stay being called "non-partisan", the CBO just leaves the contentious issue off the table in it's calculations.

Why did the BO cliff happen? He attempted to "stimulate" the economy via massive government directed SPENDING, so GDP growth was terrible and and the money largely went to big democrat supporters as a reward for being democrats, vs where it might actually increase growth.

All the howling about the current tax bill is about twiddling the upward slope of the chart below -- the CLIFF is about Democrats actually being in charge.

People that pay attention know we have been to this movie before, with Reagan in '81. Slick Willie didn't get to wreck the economy ... the Republicans took over the House for the first time in 50 years in '94, and paid the price of controlling the RATE OF GROWTH in government spending, while Slick took the credit for a short budget surplus. In terms of how media works here, that is pretty much a "fair deal'.

The REAL test is if the Republicans and Trump are willing to take the hard measures of reducing that rate of growth in spending again ... they do NOT have to make actual "cuts", only reduce the rate of growth, and that chart will trend down again (slowly) as it did in the late '90s providing that the tax cuts have the desired effect of increasing GDP growth!

This is all pretty easy to understand, one would think that a few more people would consider understanding it.

'via Blog this'

Trump Restoration Status

The Method to Trump’s ‘Madness’ – American Greatness:

First, a good explanatory article from Victor Davis Hanson; a quote:

What can possibly be Trump’s purpose in appearing so thin-skinned and petty? 

Likely it is twofold. Most obviously he seeks to reestablish deterrence: don’t dare attack Trump unless you are willing to be dragged down with him into a netherworld whose rules he has mastered. Just ask Low Energy Jeb, Little Marco, or Lyin’ Ted. 

If we have never seen a president stoop to fight with the NFL, we have also never seen the NFL kneel to self-destruct by offending millions of its fans. If the president cannot defend a national tradition of standing in honor during the National Anthem, who else could? 

Second, he knows the politicians, media hacks, and celebrities who attack him are sanctimonious bullies by nature. Their professions traffic in self-righteous invective, with the expectation that they will be never be attacked in kind.

Many people are confused by Trump -- "thin skinned, immature, non-presidential", etc. All might be true, however, HE FIGHTS ... he is the first fighting president in the culture wars, and he has done a lot of fighting and a good deal of winning this past year. See Gorsuch as well as court appointments in general, as well as making headway against the Deep State.

The big Christmas gift to all productive BOistanis is Tax Reform. The exact parameters are still in doubt, however if SALT is removed or restricted, the corporate rate drops significantly, AMT is removed or the threshold raised, and there is SOME movement toward lower rates, I think we can expect at least a couple percent of GDP growth to be added on so that they could even quit faking the numbers if they wanted and show REAL GDP GROWTH! 

It's been a LONG time since there was much of anything like "optimism" in ether the old America, or BOistan ... like 17 years ago in 2K.

Certainly the constant attacks from "The Party" (TP-D), the Deep State, and of course the media will continue, however in their attempts to get Trump, they are causing themselves a lot of collateral damage, and not only in the area of "Sexual Correctness" ... ABC has suspended Brian Ross for 4 weeks for the Fake News that Trump had ordered Flynn to work with the Russians while a candidate. In fact, he was instructed to work with them AFTER the election when Trump was president elect -- a completely normal and expected interaction. Not that private citizens can't talk to Russians -- the Clinton Fund did A LOT of it for MONEY while transferring 20% of our urainium to them in the Urainium One deal!

Lot's of smoke coming out of the TP and media houses, BOcare at least heavily wounded as part of Tax Reform, SCOTUS, judicial appointments, bleeding from the Deep State, and the constant spectacle of lefty heads exploding.

2017 has been a very good year! 

'via Blog this'

US 4Q GDP .7 ... Or -2.3%

US economy hits soft patch in fourth quarter as inventories, trade weigh:

4Q was .7% ... according to the government, we "grew" at 2.4% and "expanded" likewise in 2014.

The fourth-quarter growth pace was in line with economists' expectations and followed a 2 percent rate in the third quarter. The economy grew 2.4 percent in 2015 after a similar expansion in 2014.

As we keep track of here though, we changed the way we calculate this in July of 2015, so the number has ACTUALLY been "boosted" (manipulated) upward by as much as 3%! 

Meaning that GDP very likely SHRANK in 2015! 

'via Blog this'

4th Q, Recession Deepens?

Weak U.S. data deluge points to sharply slower growth | Reuters:

"As a result of the weak data, JP Morgan slashed its fourth-quarter GDP growth estimates from a 1.0 percent annual rate to only a 0.1 percent pace. Goldman Sachs cut its forecast by three-tenths of a percentage point to a 1.1 percent rate. The economy grew at a 2 percent pace in the third quarter."

I know that in the age of BO, we are all supposed to listen in rapture while he pisses down our backs and tells us he made it rain, but I guess I just don't enjoy it that much!

DOES ANYONE IN THE US CARE ABOUT THE ECONOMY ANYMORE!!!!

 I had to go to REUTERS to even see this! I needed an article from the Guardian to even get a TINY amount of data on the US changing the way we measure GDP as of July 1!!! 

So if the economy "grew" at 2% in 3Q, that may actually be a 1% DECLINE under the old measure. 

Now 4Q is estimated to be a 2-3% DECLINE under the old measure. 

I reported on the first two quarters here -- they originally reported 1Q as -.2 and then bumped it up when they reported 2Q with 2.3% "growth" with the new measure. So, if we take THEIR "adjusted measures" and apply the "new GDP math", we get  +.6, -.7, -1, to a -1-2% 4Q! That 

That folks is supposed to be a "good economy" in the age of BO! 

Does ANYONE believe the inflation figures from the government anymore? Sure, gas is down, but food? medical? internet? TV? property taxes? any sort of "service" like car repair, tires, etc? anyone look at the price of a car lately??? 

I realize what a complete dupe I am holding some money in "inflation protected US Bonds" -- and WHO is it that I thought was going to calculate the inflation number? Talk about the Fox guarding the hen house! 

'via Blog this'

GDP, + 1.5 or - 1.5?

Inventory Correction Masks Resilient Demand in U.S. GDP Report - Bloomberg Business:

Buried in the news is the 3Q first GDP picture ... a very tepid 1.5% growth as reported. In reading the story though, it sounds like the greatest 1.5% growth possible -- not to worry, the BO economy should not be maligned!

Completely missing is the fact that this is now the 2nd installment of the "New Math" of GDP .... supposedly giving it something like a +3% boost over what the "old tired GDP number" used for decades past reported. If that +3% is accurate, we shrank at 1.5% ...

Not to worry ... just listen to the TP media. Things are great!

'via Blog this'

Peeking Behind the Gas Price Curtain

Hometown gas stations struggle to compete against Costco; MN Dep - KTTC Rochester, Austin, Mason City News, Weather and Sports:

The simple story is that Costco dropped gas prices in Rochester to under $2 a week or so ago and now they are being investigated by the state of MN.

The simple explanation is like pretty much everything else in the modern area of N America that used to be "the land of the free and the home of the brave" -- government. Nearly 40% of actual declared GDP, but with direct control and very substantial influence over much much more. 60%? 80%? Do you call it a "market" when you get investigated for dropping prices?

The article links off to the MN statutes on how low a price stations may charge -- the definition of "cost" is a little mini-study in government legaleze.  I'm not a government official, nor government lawyer -- nor do I get paid by various groups to make it sound like it is supposed to sound, but I'll give you my simple view of "what it REALLY says".

At this point, all the small service station owners, possibly oil companies, and perhaps even large service station conglomerates like Kwik Trip, Casey's, etc, want to keep the pump price relatively high -- most important,  the government does as well, primarily because it provides more "cover" for their fuel taxes ... now .47 in MN, and .513 in WI, the Feds are .184 of that. No doubt "environmental" groups are also happy to see fuel prices high -- to say nothing of Saudi Arabia, etc, so that is likely a secondary government interest here.

If you want to look at all this in more detail, here is a link -- it covers the strategic reserve, some history back to the '70s, how ethanol raises the price, how the US produces more oil than "most people think" (MUCH more now with fracking / ND on line).

Back in 2011, the oil companies were making record profits and they were getting about .07 a gallon of gas in profit. We heard a LOT about "big oil" and how "obscene" those profits were then ...  not so much now that they have the lowest profits in 10 years.

No doubt Bernie Sanders would find those profits to still be way too high -- he probably finds less than a percent interest to be just fine as well. He would like to put a few million more highly paid union government "workers" into even more massive bureaucracy insuring that everything was allocated "fairly" without any profit or loss motive at all. Allocate it all like the old USSR -- when everyone except Bernie and a million or so cronies and party apparatchiks has nothing, you are done!

As we continue to "progress" from freedom to tyranny, the biggest thing the "progressives" operate by is misdirection -- better known as lying. We see it in healthcare -- each new "improvement" drastically increases costs / bureaucracy as seen with gas prices. We see the same thing in college education.

Markets are messy. Without all the government involvement in gas sales, Walmart and Costco may well have cornered the market because cheap gas was a way to be CERTAIN that people were going to stop there. Possibly one or two of the convenience stores, cutting prices to the bone to bring in people for milk, eggs, pop, beer ... and making their money primarily on volume.

Or maybe one of the big gas companies would go nuts putting in fully automated small pay at the pump 24x7 stations -- who knows? Perhaps they could make a deal with an auto manufacturer or two in order to have some sort of an "automated bottom fill probe" -- drive in, park (or let something like the auto parallel park technology on some cars) position the vehicle, it reads an electronic code from your vehicle, fills it and charges you and you need never get out of the car. Possibly such a system could now be designed to check / air your tires, change your oil, wash the car, ???  In a market driven economy anything is possible because  innovation is a big winner, and complacency dies. In a command economy,  imagination and innovation is killed because nothing hates change like a massive government bureaucracy.

One by one, all the pieces of our economy are being "assimilated" by the "Borg" of "progressivism". There are a lot of "scare quotes" because we now live in a world where the echo chamber of the TP -- from cradle to grave, tells all what they are to think and hides ever more of reality behind scapegoats like "Big Oil", "Big Pharma", etc -- while behind it ALL, pulling the strings like that fake Wizard of Oz, we find the ever expanding government.

'via Blog this'

Economy In Recession, Nobody Knows

Consumer spending bolsters U.S. second-quarter growth | Reuters:

BO has gotten very unhappy with his horrible economic numbers -- the economy shrank the first quarters of both 2014 and 2014 and barely eked out something below 2% total growth both years. Small wonder that BO, whose economic numbers have been worse than W who started from a very high economic base after the internet bubble (that crashed right after W took office) W  1.7%, BO 1.6%.

As that Forbes article said at the end ...

President Obama “inherited” (another favorite word of the president’s enablers) a low GDP base and did terribly with it, well worse in comparison to his much-maligned predecessor. He inherited a high government spending base and still managed to increase that number at a rate 50% above general growth. In a rational world, we’d stifle such a failure from still having access to the controls.

But then we know we don't live in a rational world, so in this one BO is still in office, and we let him cook the books! The nation has LOTS of time for "deflategate", too little pressure in NFL footballs, but NO TIME at all  for our economic numbers being

Gross domestic product expanded at a 2.3 percent annual rate, the Commerce Department said on Thursday. First-quarter GDP, previously reported to have shrunk at a 0.2 percent pace, was revised up to show it rising at a 0.6 percent rate.

The estimate of the effects of the "new accounting" for GDP was +3%, so the ACTUAL number to be used for comparison would be a .7% LOSS in GDP, putting us in the BO Recession! (Two quarters of negative GDP growth!). The column never mentions that this is now done under the new way of reporting GDP which I discussed here ... as a bonus, they blithely adjusted the first quarter up from -.2 to +.6! Erasing a recession! (they had actually revised the decline to .7% after initial reporting, but since it is now obvious these numbers are just being cooked as desired, "What does it matter now?")

So BO would have officially had a recession on his hands -- but now it looks like a quarter of REALLY tepid growth (.6%) and one that is STELLAR by BO standards ... 2.3%.  Pretty impressive, taking two successive quarters of -.7 which would be a RECESSION, and turning into what the Democrats and media will hail as "solid growth".

If you like your economy, you can elect a putz like BO and it will still all go OK!

When the WH and the media are working together, it takes a little more work to figure out what is actually happening! It isn't going so well ...

'via Blog this'

Hide The Decline, GDP Measure Changes In July, 1Q -.7

Revising how the US calculates GDP will not have a happy ending | Heidi Moore | Business | The Guardian:

The US GDP for the first quarter of 2015 has now been officially adjusted to show a decline of .7 ... last year 1Q was also a decline. With a maximum of irony for the warmist administration, both bad numbers were partially blamed on cold and snow!

So what is a failed administration with failed economic policies to match it's failed foreign policy to do? Just what the warming crowd has done multiple times -- change the how the numbers are calculated, HIDE THE DECLINE!

For the first time, the US is changing the way it measures its economic growth, the measure we call our gross domestic product. Starting in July, the keepers of US economic data at the Bureau of Economic Analysis will stand over the usual cauldron of GDP – a stew that includes how much Americans consume, government spending, investment, exports and imports. They'll begin to add new ingredients that, in a puff of smoke, will create a more favorable, higher gross domestic product. 

The new ingredients include Hollywood royalties from TV, movies and songs – some Tinseltown magic, really – as well as revenues from scientific research and development. Like a feelgood movie, this will make us feel positive, briefly – boosting our GDP by as much as 3% from its currently anemic level of 0.4%.

Won't that be nice! We add 3% ""growth" by waving a wand! Starting in July, unless you see the numbers next to a "historical GDP number", you have to subtract 3% to compare what is being reported with what you think GDP means.

Note that both of news of the decline in GDP and the change in the number calculation are from foreign news sources -- I can find them on known conservative sites in this country, but in general the MSM doesn't seem to be very interested in reporting this.

Too much important soccer news I guess!

'via Blog this'

Fixing IBM, Fixing America, Futility

How to Fix IBM:

I used to keep up with Cringely pretty well. His documentary movie, "Triumph of the Nerds" has Bill Gates, Steve Jobs, and many other leading lights of the rise of the personal computer and the internet in it, well worth the time to watch it. The article is fine too -- although I suspect far too credulous and hopeful.

In a 34 year career with IBM, from say "late '80s" on I was always hatching schemes that I thought might return IBM to the former greatness that it had with the advent of the 360, and then again for a brief instant when the PC came out -- we seemingly ruled the world. Naturally, my scale was smaller than the whole company -- but dreams of a standard IBM kernel that could allow us to have a layer of isolation/recovery/performance tuning/compatibility/ etc that would run across all our computer architectures, a standard language (eventually partially embodied as Java), schemes to do things like cloud computing today, only leveraging more PC power connected to IBM main or mid-frames -- etc, etc. Such dreams were always exciting for me -- I used to be hopeful. Some of them even got somewhat implemented in some cases, and in a couple I had the joy of being in the thick of it.

But, much as in the US, success always carries with it the seeds of demise. "Full employment" and "promote from within" created a large drag of people that were just "hanging around for their 30". While non-productive, the worst were not really the ones that knew they were "just hanging around", but rather those that were certain that they were integral to the business but really had no clue. Their "skill" was working the organization -- very much the same as middle functionaries in the old USSR, or in the middle ranks of any large organization. The Catholic Church, the military, the US government, academia -- bureaucracy is a necessary evil of human organizations, but like oxygen to our lives, it tends to eventually kill.

Eventually, the primary skill that allowed continuation with IBM became "survival" -- a skill I was willing to partially succumb to to make 30 years and a pension, but jettisoned for a final fling in cellular technology that may well have been one of those "save the company" billions of dollars wins had we invested a few more 10s of millions over a couple of years. Instead, the project  was jettisoned, and ultimately me along with it. IBM had ceased to be fun anyway, and 34 years of computing is a lot.

A friend had a poster up at IBM that had a pair of buzzards looking down from a tree saying "Patience, Hell! I'm going to KILL Something" ... with the "kill" crossed out and replaced with CODE!

One can plan, manage, legislate, analyze, design, regulate, balance,  present, document, etc, etc, but EVENTUALLY, companies, nations and even people have to BUILD SOMETHING to survive, and certainly to grow.

Which involves INVESTMENT and RISK, and has no sort of guarantees of a defined returns for a known period of time, future profits, or even breaking even!! One can summarize IBM's supposedly now abandoned "2015 roadmap" as an exercise in gutting the company and using stock arbitrage in it's own and purchased company stocks to "guarantee" institutional (and execs at the right part of their career) a significantly larger than market return on investment in IBM. Like all effectively ponzi schemes, if you got in and out at the right time, it "worked" -- all be it at the expense of a lot of good people's careers, customers loyalty (and in many cases the customers careers as well) and the conversion of one of the great lights of American technology to a stock manipulation financial holding company.

But the IBM story is really just the same story as the US government along with the governments of Western Europe and Japan. Supposedly, those governments have "guaranteed" the "Baby Boom" (or equivalent in the other nations "post-war population increase cohort") a financially secure retirement on the backs of the young, the productive, the brown immigrant, and hopefully the continually benevolent Chinese debt investor. As both Hillary and BO have declared at various points, they just don't believe that it is business that creates wealth. No, they can print it, borrow it, or just plain steal it and pass it around as they see fit.

The assertion is that grubby, risky, sometimes very messy and ALWAYS less than "perfect" (by some unknown abstract measure) activity around "building something" is just no longer needed.

IBM was on a "2015 plan". How many years is there in the US debt / currency / bond manipulation plan before it is abandoned? Who do we plan to "pay" to take the decrepit pieces of this once great country away like IBM's Chip Fab, and just what do we think is the currency we will pay that tab with?

'via Blog this'

Q1 Corrected to 2.9% GDP Decline

Welcome to Japan: More on The Q1 GDP Report | Power Line:

I've been noting the acceleration of economic problems -- vying with FICA bankruptcy and personal aging for the most predictable of events.

The linked article talks of the US moving into a Japanese style economic funk, which I generally agree with, but we are a lot bigger economy -- when the big guy gets sick, it tends to be worse! Just as when things are good, it is "more good" in a big business, economy, city, etc, the inverse is ALSO true.

I disagree with the positive implications for Republicans politically. Our nation is over that 50% relative dependency mark now (which Romney was so thoroughly castigated for claiming to still have a 3% margin). The party of dependency is the Democrat party. When people get scared, they are going to tend to vote Democrat which going to exacerbate the problem. That is natural, it is part of why nations decline when they abandon the principles that made them great -- self reliance, thrift, competitiveness, excellence, etc, and switch over to "rights, safety, leveling, regulation".

The US economy resembles nothing more than an ailing back patient that has been over medicated, possibly operated on and is in an accelerating slide, accelerated by many of the "cures" that were supposed to be "the fix".

We need to slow government spending, TAKE SOME PAIN, remove some taxation so that those that can accelerate the economy SEE SOME GAIN ... but this time start the SLOW ARDUOUS PROCESS of realizing that there is no such thing as "economic safety", and that HARD WORK needs to be encouraged with INCENTIVES, while sloth needs to be STRONGLY discouraged with DISincentives.

BTW, raising the minimum wage is NOT an "incentive". It prices low skilled workers that first and foremost need to get in the habit of working out of the job market.

'via Blog this'

BO vs Reagan on Job Growth

This Simple Graph Compares Reagan’s and Obama’s ‘Recoveries’:

Of course BO doesn't really believe that a job is something we need and a majority of the country agrees with him!


'via Blog this'

Chutzpah and Economic Numbers

 US Constitution, Article 1, Section 7:1

"All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills."

I've seen a few "facts" floating about about how great a job BO is doing! All sorts of numbers about deficit reduction, economic improvement including jobs, etc. It reminds me of how he has the chutzpah to take credit for oil production going up on his watch. In the real world, our increased oil production is 100% the result of hydraulic fracking in shale which BO has much to do with as I do. Actually less, since he has tried to stop it, regulate it, and has stopped the Keystone pipeline.

If you have been listening a little too credulously to MSM outlets (it is easy to do, we ALL soak in it!), you may need to refresh your memory. Bill Clinton for example DID NOT "balance the budget". A short perusal of the Constitution plus a slight remembrance of the howling as Republicans "cut" (reduced the rate of GROWTH) in Medicare, plus took other "mean, hard hearted and cynical" actions on the budget that overall SLIGHTLY reduced the rate of GROWTH in government spending, PLUS (and most importantly) releasing the productivity of the American people and creating growth in the economy. One of the things I loved about Reagan was that he constantly reminded us that the engine of all good things is economic growth, not government!

The combination of the MSM controlling the story line, and the general poor memory and natural desire to believe the current narrative allows 90% of the population to live in an MSM wonderland where Slick Willie or BO fights valiantly against the evil Republican forces trying to CUT TO THE BONE (reduce the rate of GROWTH) in spending on Medicare, Military benefits, Food Stamps, Head Start for wonderful innocent little children, all because of their inherent evil and the fact that they are beholden to awful profit seeking business!

Then, when nothing bad happens because of the "cuts", "sequester", "shutdown", etc, and the economy starts to show signs of life, who pops up like a Jack-in-the-box saying "I did it, I did it!!" but the President. Naturally, if the president has a "D" next to his name, the media gets all gushy about HIS success!

If it is an "R" however, they have usually already been pushing hard on an economic and tax agenda that the media found "draconian", so when the economy improves, "it just happened" ... which in BOTH cases is more true than not, since the best thing government can generally do is get the hell out of the way!

Both Slick Willie and BO ought to be INCREDIBLY grateful for their Republican Congress. Without it, Slick would never have had what he and the MSM trumpets as his singular achievement -- BJs with pizza in the Oval Office, oh wait, I meant "his" balanced budget!

BO would not have had the impressive feat (for him) of seeing the unemployment number below 7%!! WOW!! (it was under 5% in '07). Of course we are not talking about the labor participation rate that is the worst now that it has been since the '70s!

Don't expect the MSM (or BO) to be applauding the results of the Republicans feeble attempts to slow the rate of growth in the federal spending juggernaut anytime soon.

Back to the '70s

Unemployment Drops to 7.6%, Mass Jobs Exodus Puts America Back at Pre-Reagan Labor Force Levels | Independent Journal Review:

Well, at least we don't have to wonder anymore what it would have been like if Jimmy Carter had gotten a 2nd term. We are living it!!

I also LOVE how SURPRISED the economists are! At least the ones the MSM consults tend to be SHOCKED by bad economic numbers when a Dem is in the WH and good economic numbers when a Republican is in there -- any good number during the W years was "surprising", and any bad number now is positively unbelievable for them. Duh!

When your models keep making the wrong predictions it is time to CHANGE YOUR MODELS!

Insanity is doing the same stuff and expecting different results!

'via Blog this'

Good Jobs??

Obama’s Jobs Failure, In One Chart | Power Line

As a long time NPR listener, I know that whenever there is a "good jobs number" (lower unemployment, good number of jobs for a month/quarter, etc) ... well, at least during the Reagan years and the W years, the question was always "Are those good jobs ?? or low paying dead end jobs??"

Is the person "underemployed"? Meaning are they in a job that is below their skill level?

How about "disenchanted workers"?? Those folks that have gotten so sick of looking for work that they are just sitting it out??

Those are all good questions, but they are good questions no matter who is in the WH, and the ANSWERS are also important.

Unfortunately, for BO, the answer on especially the disenchanted front is terrible as the linked chart clearly shows.

Reality Is

As economy slows and Fed voices conflict, markets look to Bernanke for guidance

The major power in the US Government is in the Congress. The Democrats took over in '06, we are now in our 4th year of Democrat rule and over 2 years into recession. Reality 1.

Wishful thinking is not a policy. Government is FAR more limited than what the left likes to believe relative to the economy. If it were not so, then the USSR would have been a huge success, and Japan and the European economies would have done vastly better than the US. They did not and are not -- but since we have made a hard turn toward emulating their approaches, we are seeing the same results -- only worse. We are much larger, so their bad policies are mega-bad when applied to the US.

The idea that "the economy always cycles and this is just a cycle" is based on way too short a sample set. BO and the Democrats talked the economy down as hard as they could in '08 in order to add to their election victories. The word "depression" was quite common leading up to the election. Their assumption --- and most people's assumption, was that the economy was going to bounce back quickly and that the stimulus was just a little extra insurance --- that is why they used most of the stimulus to transfer to states, largely to pay off government and teachers unions for supporting their election. They figured the economy would go up "like it always does" and they would claim credit.

Democrats yelled about deficits that were tiny relative to GDP -- and they always talked about those deficits "crowding out" loans to small business and consumers in the midst of a growing world wide economy. Now they are running multi-trillion dollar deficits in a global recession, and they have forgotten all about "crowding out". Democrats have no sense of perspective. I would have much rather seen smaller or non-existent deficits under Republican administrations, but those deficits were MUCH smaller, AND other than '82, they were in much better economic times. A few drinks are fine, not "perfect", but fine -- the Democrats are drinking a 5th of debt whiskey for breakfast, that is a problem!

At some point, people are going to have to start believing in THEMSELVES again! First, we have got to get a WHOLE bunch of government off our backs! 

Economy Stalled

GDP report - latimes.com

As we ought to have learned in the 30's, 60's, from Japan, from Europe, or from many other sources, capitalism is an imperfect system, but vastly better than the alternatives. Dem-O-nomics -- rob from the rich, the future and the productive, and give to the poor, the political cronies and the non-productive, DOESN'T WORK!!!!

Objectivity Is Out

Ferguson: How Economic Weakness Endangers the U.S. | Newsweek National News | Newsweek.com

Excellent article from NEWSWEEK! Ferguson is an extremely intelligent economist and author who is currently a professor of history at that bastion of conservatism - Harvard. The whole thing is well worth reading, but I find the quote from Krugman to be especially troubling. It seems that many of our supposed intelligentsia subscribe to the post-modern view that there are no facts, only human views of the world. How else can one claim that claim that deficits in the low 100's of billions are "irresponsible", yet applaud multiple Trillion deficits as far as the eye can see? Doesn't a Nobel Prize winning economist have to have SOME objectivity to be called "a professional"?

Now, who said the following? "My prediction is that politicians will eventually be tempted to resolve the [fiscal] crisis the way irresponsible governments usually do: by printing money, both to pay current bills and to inflate away debt. And as that temptation becomes obvious, interest rates will soar."Seems pretty reasonable to me. The surprising thing is that this was none other than Paul Krugman, the high priest of Keynesianism, writing back in March 2003. A year and a half later he was comparing the U.S. deficit with Argentina's (at a time when it was 4.5 percent of GDP). Has the economic situation really changed so drastically that now the same Krugman believes it was "deficits that saved us," and wants to see an even larger deficit next year? Perhaps. But it might just be that the party in power has changed.

A lot of the article is taken up by thoughts on what is likely to happen because of the entitlement and debt train wreck that we are in. The idea of hyperinflation is covered but amazingly (to me) dismissed. What he suggests is more likely is a rise in the real interest rate and inflation falls -- or, while he doesn't say this, goes negative into deflation. Deflation is what has already happened to the stock market, home values and gas prices. Maybe we are developing a trend?

So here's another scenario—which in many ways is worse than the inflation scenario. What happens is that we get a rise in the real interest rate, which is the actual interest rate minus inflation. According to a substantial amount of empirical research by economists, including Peter Orszag (now at the Office of Management and Budget), significant increases in the debt-to-GDP ratio tend to increase the real interest rate. One recent study concluded that "a 20 percentage point increase in the U.S. government-debt-to-GDP ratio should lead to a 20–120 basis points [0.2–1.2 percent] increase in real interest rates." This can happen in one of three ways: the nominal interest rate rises and inflation stays the same; the nominal rate stays the same and inflation falls; or—the nightmare case—the nominal interest rate rises and inflation falls.

I'm not sure I completely understand the reason for his 20% tipping point, but debt service rising from 8% to 17% of revenues by 2019 sounds bad enough to me anyway. It seems to me that people tend to grossly UNderestimate what we spend on entitlements and grossly OVERestimate what we spend on Defense and debt already -- as in I suspect that most folks would think for some reason that we spend over 20% of the budget on debt payment already. I'm not sure what they will think when it is reality, but no matter what they think, I really doubt it will be good.

Already, the federal government's interest payments are forecast by the CBO to rise from 8 percent of revenues in 2009 to 17 percent by 2019, even if rates stay low and growth resumes. If rates rise even slightly and the economy flatlines, we'll get to 20 percent much sooner. And history suggests that once you are spending as much as a fifth of your revenues on debt service, you have a problem. It's all too easy to find yourself in a vicious circle of diminishing credibility. The investors don't believe you can afford your debts, so they charge higher interest, which makes your position even worse.

Nice Noonan

Peggy Noonan: We're Governed by Callous Children - WSJ.com

The biggest threat to America right now is not government spending, huge deficits, foreign ownership of our debt, world terrorism, two wars, potential epidemics or nuts with nukes. The biggest long-term threat is that people are becoming and have become disheartened, that this condition is reaching critical mass, and that it afflicts most broadly and deeply those members of the American leadership class who are not in Washington, most especially those in business.

It is a story in two parts. The first: "They do not think they can make it better.

I agree. I was around in '78-'82 and I think Peggy calls it perfectly:

I talked this week with a guy from Big Pharma, which we used to call "the drug companies" until we decided that didn't sound menacing enough. He is middle-aged, works in a significant position, and our conversation turned to the last great recession, in the late mid- to late 1970s and early '80s. We talked about how, in terms of numbers, that recession was in some ways worse than the one we're experiencing now. Interest rates were over 20%, and inflation and unemployment hit double digits. America was in what might be called a functional depression, yet there was still a prevalent feeling of hope. Here's why. Everyone thought they could figure a way through. We knew we could find a path through the mess. In 1982 there were people saying, "If only we get rid of this guy Reagan, we can make it better!" Others said, "If we follow Reagan, he'll squeeze out inflation and lower taxes and we'll be America again, we'll be acting like Americans again." Everyone had a path through.

I think I had a special seat, because I voted for Carter, listened to the "malaise", started reading about this thing called "conservatism" that my schooling had never exposed me to and then hoped that Reagan was right. I also got to watch while in '80-'82 the country was in worse shape than now and the majority of my college friends and even many of the people at were were "sure we had made a mistake with Reagan". BUT, BOTH the Republicans and the Democrats were "sure they had an answer that could return the country to prosperity". Now we don't. I really don't know anyone other than maybe BO himself that truly believes in BOnomics. We are going to borrow prosperity from the Chinese? Seems pretty doubtful to even the most optimistic.

I talked with an executive this week with what we still call "the insurance companies" and will no doubt soon be calling Big Insura. (Take it away, Democratic National Committee.) He was thoughtful, reflective about the big picture. He talked about all the new proposed regulations on the industry. Rep. Barney Frank had just said on some cable show that the Democrats of the White House and Congress "are trying on every front to increase the role of government in the regulatory area." The executive said of Washington: "They don't understand that people can just stop, get out. I have friends and colleagues who've said to me 'I'm done.'" He spoke of his own increasing tax burden and said, "They don't understand that if they start to tax me so that I'm paying 60%, 55%, I'll stop."

He felt government doesn't understand that business in America is run by people, by human beings. Mr. Frank must believe America is populated by high-achieving robots who will obey whatever command he and his friends issue. But of course they're human, and they can become disheartened. They can pack it in, go elsewhere, quit what used to be called the rat race and might as well be called that again since the government seems to think they're all rats. (That would be you, Chamber of Commerce.)

Peggy doesn't know the half of it. The left could care less about any thoughts of "motivation", I believe that many more of them than anyone realizes would just as soon put the "tax cows" in big concentration work camps right now. Why can't the "disenfranchised" just be awarded what they want? Isn't it "selfish" of someone that studied hard, built skills and is marketable to not make as much money as possible so it can be handed to those that didn't develop any skills and have no intention of doing so?

Jobs Over Time

http://tipstrategies.com/archive/geography-of-jobs/#map-highlights

Interesting to look at actual data. Seems like things were working pretty darned well until 2008. I wonder, did anyone run on "Change" in 2006? How did they come out?

Remember when the Republicans took over Congress in '94? One would have thought that the world had come to an end to listen to the media -- why it was almost as bad as Reagan winning '80.

For those that aren't complete slaves to the MSM, it is interesting to go out and look at what actually happens to the economy after the "horror" of Republican takeovers and the "welcome change" of the Democrat version.

When Is The Stimulus a Failure?

So the Democrats and the MSM declared the Surge a "failure" before a single extra soldier had been sent to Iraq. That was considered "fine".

BO predicted that we needed to spend $800 Billion to keep unemployment from going over 8%. Can you imagine the outcry if the Surge HADN'T actually worked??

Is it clear yet that this clown as absolutiely no idea what he is doing? HEEEELLLLOOOO !!!! is there anyone paying any attention, or are people such complete media sheep that they will just go with whatever they are told to think??