Views on the News
March 24, 2012
Views on the News*
America has NOT been prospering for the last four years during which Barack Obama has been President, and everyone knows it. The U.S. sovereign debt rating was downgraded for the first time while he occupied the Oval Office. Federal spending (25% of GDP) is the highest since World War Two. Federal debt (67% of GDP) is the highest since just after the end of World War Two, and the nation has experienced, not only the longest recession, but the highest unemployment since the 1930s. In the first nineteen months of his time in office, Obama added more federal debt than was amassed by all U.S. Presidents from George Washington to Ronald Reagan. Obama’s Achilles’ heel is, of course, ObamaCare. Recent polls indicate that 53% of Americans favor repeal and more than half (57%) say that the Supreme Court should strike it down as unconstitutional. Fully 60% of physicians believe the law will have a negative impact on overall patient care. The Congressional Budget Office revisited ObamaCare this past week and concluded that 20 million Americans could lose their employer-sponsored health benefits and 49 million more Americans could become dependent on government-sponsored health care. Projecting through 2022, ObamaCare could cost as much as $2.134 billion and the employer-mandate penalties could hit $221 billion. While Obama’s 2012 campaign is already showing signs of stress, other issues will impose great pressure. Unemployment affects most American families either directly or because some member of the family or a friend is unemployed, and even the unemployed vote! The price of gasoline continues to rise and there is nothing the White House can do to reduce it. Americans are well aware that this administration has opposed or thwarted every effort to drill for more oil on federal lands. The failures of “green energy” companies that have cost Americans billions in loan guarantees are well known. A President who hypes “algae” as an energy solution will be seen as a fool and/or a complete charlatan. A conservative campaign message will win in 2012 and this explains why the Republican primaries are all about candidates striving to describe themselves as a “true conservative.” Even the mainstream media show indications of less Obama support. Obama will definitely lose in November and it may be a very close election or it may be an overwhelming rejection, but the polling numbers and the state of the economy will be the deciding factors.
(“Why Obama Will Lose in November” by Alan Caruba dated March 18, 2012 published by Canada Free Press at http://www.canadafreepress.com/index.php/article/45326 )
As the election of 2012 approaches, the left becomes more desperate because for the first time in his adult life, Barack Obama has to deal with the reality that he's Barack Obama and being Barack Obama has created a real conundrum for the Democrats. Obama wanted to play President, not be President, and the real Barack Obama is anything but a confident, competent winner. Some of those who did not support Obama tried to sound the warning bell about Obama's severe lack of everything necessary for a President to succeed. Obama lacked experience, and he continues to lack character, integrity, and a love of the America that has taken over 200 years to build. The scary thing for Democrats is they went all in on Obama. They spent so much time propping up their puppet, believing that style would prevail over substance, but Obama failed miserably, and the Democrats have no succession planning. Obama was perfect for the rebirth of radical Regressivism, sure to continue punishing minorities. However the strategy backfired, because Obama was supposed to be at the very least "okay." Obama is okay, if you like that America is now fighting for third-world status. The walls surrounding Obama are crumbling from within. Right-wing conspirators need not apply, and the Republican machine has been switched off. It's the Democrats who are destroying Obama, which is one reason why the Obama administration is panicked. It appears that in 2012, the media love a salacious story about Obama's past more than they love Obama. God forbid we actually get to see Obama's grades or a new and improved birth certificate. A recent poll has Obama dropping by 12 points with women! The same women who wanted to take Obama home to daddy are now abandoning Obama like last year's fashions. It doesn't take a psychic to see the future for Obama. Obama is so desperate to keep his position that he recently made a Truth Team declaration that he has drilled for more oil than any other President. Forget that Obama has said publicly that he wants to destroy the coal industry. He publicly battles with "Big Oil" dirty revenue, and he wouldn't allow the Keystone Pipeline to happen or allow drilling on federal land. Meanwhile, back at the algae farm, Obama discussed removing oil company "subsidies" (the same tax deductions allowed other companies) as he doubled down on failed green energy failures, boondoggles, and payola to same. Obama is reneging on his declaration that if he didn't have things on track in three years, he should be a one-term President. Two things have saved Obama to date: the media and Obama's "blackness." Had it not been for either, Obama's choices would have been impeachment or resignation. America has become so politically correct that despite the President being "black," he can still run on the "I'm a victim of racism" ticket, but that's changing, and it vexes the left. America finally got a recognized black President, and America is worse off; we are all victims of Obama. Obama owns whatever America has become, because leaders must take credit or blame, regardless of the circumstances, but Obama can't admit he is not a leader over the worst America in decades and that is the Democrats' conundrum.
(“Obama versus the Democrats” by Kevin Jackson dated March 19, 2012 published by American Thinker at http://www.americanthinker.com/2012/03/obama_versus_the_democrats.html )
Many conservatives feel like this is the most important election in our lifetimes because they desperately need to reverse the damage done by the Obama administration and get the economy moving again. They want to fix what Obama (or Washington) has broken. The President, meanwhile, like a little kid smashing a clock with a hammer, says he just needs a little more time to fix everything, but he only has a whole bunch of monkey wrenches that he can throw into the economic machinery. Like a drunk blind guy with a blowtorch, there are infinite possibilities for making things worse, far fewer for making them better. Herbert Hoover and Franklin Roosevelt turned a mere depression into the Great Depression. Hoover got the blame for starting the Great Depression because it happened on his watch. Not everything FDR did was bad, but very little in the New Deal made the economy better and much made it worse. What is not controversial is that FDR got the political credit for ending the Depression, even though it really didn’t end until he stopped trying to fix it, and the economy didn’t boom until after he died. Liberals continue to believe that big-government policies are effective in no small part because they think FDR fixed the economy with the New Deal. While President Obama is responsible for many bad policies, right now it seems his fate is directly related to the price of gas. The lesson for 2012 is that when the economy really gets moving again, Americans will ascribe those advances to Republican policies. There’s reason to believe that ideological realignments in this country are not necessarily the product of careful analysis and rigorous reasoning, but rather, they are the result of people assigning blame to the guy that just happens to be in charge when the data hits the fan.
(“A Never-Ending Game of ‘Hot Potato’” by Jonah Goldberg dated March 16, 2012 published by National Review Online at http://www.nationalreview.com/articles/293647/politics-never-ending-game-hot-potato-jonah-goldberg )
The American people feel that the economy has not recovered from the 2008 recession and fear that government intervention may be a large part of the cause of this anemic economic performance. Obama and his socialist cabal have channeled Hoover and FDR, who turned an ordinary bust into The Great Depression with a toxic strategy of bigger government, more spending, more debt, expanded entitlements, more rules and regulations strangling business, higher minimum wages, more power to unions, and dramatically higher taxes to pay for this expansion of big government. Simply add in "green energy" and this is the same toxic brew of the Obama game plan. It's the same plan that has led Europe to the edge of the cliff as well, and the EU is crumbling under the weight of their suffocating debt. Obama still faces an uphill battle this November because the non-rich aren’t feeling better off:
· The unemployment rate is still above 8%, even though the White House promised it would drop to about 6% today if the stimulus was enacted.
· Several million fewer Americans have jobs today than five years ago.
· The poverty rate has jumped to more than 15%, with a record number of Americans living below the poverty level of income.
· According to the most recent data, median household income is lower than when the recession began.
· The burden of government spending remains high, and record levels of red ink are a symptom of that bloat in Washington.
· The threat of higher taxes is omnipresent, serving as a Sword of Damocles over the economy’s neck.
· Continued weakness in the housing and financial sectors reminds people that bailouts and intervention have left lots of problems unsolved.
White House staffers argue that all this simply illustrates the economic weakness they inherited which may be a plausible argument, at least in theory, but many voters view this as political blame-shifting. America is enduring a very anemic recovery. In fact, the nation is suffering its worst post-recession period since the Great Depression. So there’s a strong case to be made that Obama’s policies have retarded the normal bounce that an economy should experience when coming out of a downturn. Voters sense that the crowd in Washington bears some blame for this dismal situation:
· The recovery began just as Obama’s stimulus spending ended, thus confirming suspicions that lots of money was wasted as part of a process that hindered the economy’s growth.
· The job numbers only began to improve at the end of 2010, right as Republicans took control of the House and presumably ended Obama’s ability to do further damage.
Perhaps most important, voters can see what’s happening in Europe, where welfare states are collapsing thanks to decades of overspending and over-taxation. They have a vague understanding that America is on the same path because of demographics and poorly designed entitlement programs. The problem for the White House isn’t just the numbers.; there’s a growing unease that the rules have changed for the worse. Such scandals as Solyndra lead people to suspect that cronyism has replaced capitalism. Record numbers of people using food stamps make people wonder about the long-run consequences of having more and more people riding in the wagon and fewer and fewer people pulling it. None of these problems started with Obama; many even predate the Bush years, but Obama has expanded these bad policies instead of changing them. He promised hope and change, but he’s doubled down on the failed statist policies of his predecessors which is why the White House isn’t getting much credit for a rising stock market and falling jobless rate. To the extent we’re getting good news, it’s in spite of the folks at the White House, because reaching bottom in an elongated recovery is not the same as having recovered, but rather the cessation of government intervention making the economy worse.
(“Are We On the Verge of the Obama Great Depression?” by Wayne Allyn Root dated March 18, 2012 published by Town Hall at http://townhall.com/columnists/wayneallynroot/2012/03/18/are_we_on_the_verge_of_the_obama_great_depression
“Inside America’s economic angst” by Daniel J. Mitchell dated March 19, 2012 published by New York Post at http://www.nypost.com/p/news/opinion/opedcolumnists/inside_america_economic_angst_jjbpP5fF1KFEKiW8DAz3UK )
Congressman Paul Ryan has delivered another bold budget to recommit the Republican party to spending restraint, tax reform, and a strong defense. Ryan’s plan moves the federal budget into sustainable balance, even on the unfavorable assumptions of the Congressional Budget Office. President Obama has never produced a plan to balance the budget on any time frame. Senate Democrats have not produced any budget at all for three years. We doubt that most Americans will find that consistently large deficits and ever-rising debt levels meet their definition of fairness, balance, and responsibility. Nor will they favor what we suspect is the President’s real, though secret, plan: to allow taxes to rise on everyone, in effect cycling the middle class’s money back to it through Washington for the benefit of the Democrat party. The Ryan budget would spend $5.3 trillion less than President Obama plans to spend over the next decade. It repeals ObamaCare and limits Medicaid spending by offering states a capped amount of funds, ending the current practice of bribing them to expand coverage. It commits to a tax code that raises the same revenue, as a proportion of the economy, as we have historically raised, but does so with lower tax rates, less hostile treatment of capital, and fewer loopholes. The main change Ryan has made between last year’s Republican budget and this one concerns Medicare. The budget proposes that instead of rising at a predetermined rate, the size of the subsidy to defray costs should depend on the results of a bidding process in which insurers in each of Medicare’s administrative regions compete to cover the minimum benefits package at the lowest price. In principle, these changes could be advances for conservatism rather than concessions. If competition and price sensitivity drove costs down, a competitive-bidding model could reduce Medicare spending more than last year’s proposal would have. Ryan can be said to be “ending Medicare as we know it” only in the sense of stopping it from being quite as centrally micromanaged, and unsustainable, as it is now. He went further to explain that under a different, more realistic, economic growth scenario than assumed by the CBO, his budget can balance within ten years. Ryan and the Republicans have put forward a plan to bring the federal debt under control and to avoid massive tax increases, since neither the President nor his Democrat allies have done these things and this contrast is politically stark.
(“Paul Ryan Leads” dated March 21, 2012 published by National Review Online at http://www.nationalreview.com/articles/293992/paul-ryan-leads-editors )
The federal government has taken over large swaths of consumer lending, most notably the $10 trillion home mortgage and $1 trillion student lending markets, as the government's share of new loans for each now approaches 100%. The housing and education lobbies strongly favor government involvement in financial services. Their actions are based on two beliefs: (1) that the government is able to charge lower rates for loans-which comes as no surprise given the numerous advantages the government has over the private sector; and (2) that since the programs are designed to be self-sufficient; they pose no risk to the taxpayer. If only this were true. Over the years, taxpayers have had to bail out failed government insurance programs such as the Federal Savings and Loan Insurance Corporation, Fannie Mae, and Freddie Mac. Others are insolvent: the Federal Housing Administration (FHA), the Pension Benefit Guarantee Corporation, and the National Flood Insurance Program. The Federal Deposit Insurance Corporation avoided insolvency thanks to the Troubled Asset Relief Program (TARP) and the Fed's imposition of artificially low rates for years, resulting in the transfer of hundreds of billions of dollars from savers to debtors. Government insurance programs suffer from three fundamental flaws: (1) the government cannot successfully price for risk; (2) government backing distorts prices, resource allocation, and competition; and (3) political pressure and Congressional demands for a quid pro quo inevitably arise, politicizing the programs. The federally guaranteed student loan program may be creating yet another bubble. The cost of four-year private and public college educations has gone up by 27% and 49% respectively (in constant dollars) since 2001, yet federally guaranteed student loans have increased by over 100% (in constant dollars). A feature of the government's inability to price for risk is a conscious decision by Congress to under-price risk. The worst risks are inevitably priced about the same as the best ones and the lowest risk guarantees are used to cross-subsidize those with the highest risk. Up until recently, Freddie Mac didn't price for risk, but has changed, at least while it is in conservatorship. The risk premium required by Freddie is high because about one in every five of borrowers with these characteristics is expected to fail. When the government treats high and low risk borrowers in the same way, those with poor savings and bad credit habits are rewarded, while the low risk borrowers are penalized. At the same time, this policy encourages low-risk borrowers to take on more risks. A two-fold solution is needed:
· First, government insurance programs must be restricted to being prudent providers of guaranteed financial services to low- and moderate-income Americans. These programs must end their promotion of high-risk behavior.
· Second, consumers themselves must be protected from the lack of pricing transparency in government insurance programs. This lack of transparency is used to mask imprudent guarantees from credit applicants. The solution is to pass a Truth in Government Lending Act (TIGLA). Each consumer applying for a government guarantee would be given an easily understandable disclosure form within 72 hours of application and at closing. The document would explain the expected failure rate of individuals with risk characteristics similar to the applicant's.
· The federal student loan program also clearly demonstrates the need for TIGLA. The Department of Education reports that early default rates for guaranteed student loans range from about 5% for four-year public and private four year colleges to 15% for for-profit four year colleges with the average for all students being about 9%. A new study published by the New York Federal Reserve Bank found that actual student loan default rates are more likely 27% or triple the rate reported by the Department of Education.
Today, the four fastest growing government insurance programs are the FHA, the USDA's single-family guarantee program, Ginnie Mae, and the direct federal student loan program. We have seen this movie before and a bad ending is inevitable. Government insurance programs must be reined in before the government's control of multiple financial sectors leads not only to further bailouts, but to uninformed and imprudent risk-taking by consumers.
(“Truth in Government Lending is Long Overdue” by Edward Pinto dated March 21, 2012 published by Real Clear Markets at http://www.realclearmarkets.com/articles/2012/03/21/truth_in_government_lending_is_long_overdue_99575.html )
The United States men and women in our armed forces are the finest in the history of the world and the quality of warriors trumps everything else. In the last fifty years, our military has fought wars in steaming jungles, in burning deserts, on tropical islands, and in inland mountainous lands -- almost every conceivable sort of climate and culture. This has given our military much more combat experience than any other nation on earth. Those men and women who have joined the services also stay in the services much more than in past decades. These men and women are significantly more intelligent than the average American. These facts collectively mean that the capability of our military personnel is vastly superior to other armed forces. Another reason for the superiority of our troops is the fact that all who wear the uniform are volunteers. Conscripted armies are filled with men who dislike military service and may find the military objectives of their government foul. Our military, in stark contrast, has only those who have chosen to fight for their country and have accepted military service as an honorable career. The fact that these are all volunteers radically changes the political consequences of smearing our troops. We do not just support those who are in uniform now; our nation has embraced those men and women who have been maimed or crippled to keep us safe with wonderful efforts like Wounded Warrior Project, which means that not just government programs, but grateful countrymen will help said people and their families through the pain of the sacrifices they have made for us. Operation Homefront focuses on the families of servicemen and women. Here lies the greatest source of American military power: our armed forces are filled with men and women who are proud to fight for their country, who have more experience in combat than any military in the world, who are seasoned professionals, who are smarter than their countrymen, and who feel strong support from the American people.
(“The Source of American Military Power” by Bruce Walker dated March 17, 2012 published by American Thinker at http://www.americanthinker.com/2012/03/the_source_of_american_military_power.html )
President Obama had multiple opportunities to make peace with conservatives in Congress, set the foundation for a bipartisan agenda in Washington and burnish his image as a man who led from the middle, but he dropped the ball repeatedly. His counter-terrorism strategy was being called “Bush-lite,” incorporating many of the same operational concepts. U.S. troops were making progress in Iraq and Afghanistan. If Obama had just held that course on national security, he would have been largely indistinguishable from the mainstream leadership on the other side. Instead the White House chose another course: cut-and-run strategies in Iraq and Afghanistan; deep cuts in defense capabilities; threats of more cuts if Congress didn’t green-light hefty tax hikes; and a “new” counter-terrorism strategy that looks a lot like the failed Clinton strategy of the 1990s, the strategy that kept al Qaida on the path to 9/11. It’s epitomized by the “I got bin Laden” bumper sticker, which is neither true (getting bin Laden was the product of 10 years of post-9/11 effort) nor relevant. We see the President declare victory in both Iraq and Afghanistan, even as the violence increases in both nations. He continues to trumpet the Russian “reset,” which has delivered nothing. He hails a victory in Libya which is largely irrelevant to vital U.S. interests and appears to fall far short of being a blessing for the Libyans. He finally comes around on Iranian sanctions - too little, too late. And he caps all this with a strategic guidance that calls for deep cuts in conventional and nuclear forces, predicated on the assumption that he has somehow made the world safer. When historians look back at the Obama Presidency, they could well peg his dramatic shift in defense policy as a lost opportunity, particularly if the administration suffers a significant foreign policy reversal due to plans this President put in place.
(“Obama’s lost moment” by James Carafano dated March 16, 2012 published by The Daily Caller at http://dailycaller.com/2012/03/16/obamas-lost-moment/ )
* There is so much published each week that unless you search for it, you will miss important breaking news. I try to package the best of this information into my “Views on the News” each Saturday morning. Updates have been made this week to the following issue sections:
· Bibliography at http://www.returntocommonsensesite.com/welcome/elections.php
· Elections at http://www.returntocommonsensesite.com/dp/elections.php