Showing posts with label credit downgrade. Show all posts
Showing posts with label credit downgrade. Show all posts

Tuesday, August 9, 2011

Political Digest for August 9, 2011

Resources
For those who want further information about the topics covered in this blog, I recommend the following sites. I will add to this as I find additional good sources.

LtCol Alan West on Treasury Secretary Tim Gaithner
“When you open that refrigerator door, the light doesn’t go on.”

Our Economic and Governmental System
Rough language, but painfully true. ~Bob.

Important: In this grave crisis, the world's leaders are terrifyingly out of their depth
He must have read my book. The Euro model is failing rapidly. Imagine you and ten friends deciding to pool income and debts, but each still decides how much to spend on himself. That is the disaster of the eurozone. ~Bob. Excerpt: Certain years have gone down in history as great global turning points, after which nothing was remotely the same: 1914, 1929, 1939, 1989. Now it looks horribly plausible that 2011 will join their number. The very grave financial crisis that has hung over Europe ever since the banking collapse of three years ago has taken a sinister turn, with the most dreadful and sobering consequences for those of us who live in European democracies. The events of the past few days have been momentous: the eurozone sovereign debt crisis has escaped from the peripheries and spread to Italy and Spain; parts of the European banking system have frozen up; US Treasuries have been stripped of their AAA rating, which may be the beginning of a process that leads to the loss of the dollar’s vital status as the world’s reserve currency. There have been warnings that we may be in for a repeat of the calamitous events of 2008. The truth, however, is that the situation is potentially much bleaker even than in those desperate days after the closure of Lehman Brothers. Back then, policy-makers had at their disposal a whole range of powerful tools to remedy the situation which are simply not available today.

Kerry blames Tea Party for downgrade, says Senate GOP willing to raise taxes
This is the guy who slandered his comrades in arms for committing atrocities, though none of the claims were ever proven and some of those he had testify were proven liars. This against an enemy who regularly slaughter civilians, including children, to create terror. So if he told me to have a nice day, I’d call the weather bureau to check. ~Bob. Excerpt: Sen. John Kerry (D-Mass.) on Sunday blamed the Tea Party for causing Standard & Poor’s to lower the nation’s credit rating. Kerry argued that Republicans in the Senate were willing to raise tax revenues as part of a long-term deal to reduce the federal deficit, making reference to the Senate’s Gang of Six plan, which attracted bipartisan support.

Kerry’s Absurdities
Excerpt: Senator John Kerry (D-MA) thinks the ideas of the Tea Party are “absurd.” The media should not be covering the Tea Party philosophy of reduced spending and debt and a balanced budget. In 1997, Kerry himself sponsored an amendment to balance the then-current budget. He didn’t think that was absurd. What is absurd is that no one is more to blame for the government’s long-time spending binge than Senator John Kerry himself. As the nation’s credit rating is downgraded, and our federal debt exceeds the entire output of the U.S. economy, Kerry on Meet the Press Aug. 7 called for more spending for infrastructure and other programs as if they would add naught to the nation’s deficit. Except for the move toward fiscal sanity and budget balancing 14 years ago, Kerry wants the media to steer clear of the wild ideas of the Tea Partiers’ financial conservatism. He wants the news media to continue to support the fiscal insanity of the liberal Democrats. He “doesn’t want any real reporting on actual accountability for our economic problems,” as the Pajamas Media Tattler reported Aug. 5. Those problems started with the Community Investment Act, managed through the Democrats’ control of the failed Fannie Mae and Freddie Mac., and then on to ObamaCare, the stimulus spending package, and the Dodd-Frank super-regulatory law.

Most post offices targeted for closure are in GOP districts
This may be because they are closing rural offices, and Democrat districts tend to be in cities with lots of union, government employee and welfare voters. ~Bob. Excerpt: A large majority of post offices that have been targeted for closure are in Republican districts. More than 2,500 of these post offices are in GOP districts while about 1,000 are in districts represented by Democrats, according to a review by The Hill. There were fewer than 100 stores where the district could not be determined because the zip code is represented by lawmakers in both parties.

Economists skeptical Obama's veterans jobs plan will cut unemployment rate
Excerpt: President Obama’s push to boost job prospects for veterans certainly looks to be well-intentioned, economists say, but does not appear broad enough to attack the deeper problems in the job market. On Friday, the president proposed expanding or rolling out new tax incentives for companies that hire veterans, and called on businesses to employ or train 100,000 veterans or their spouses over the next two-plus years. But economists of all stripes are far from certain that jobs proposals aimed at veterans or other targeted groups will put much of a dent in the unemployment rate, which the Labor Department said Friday stood at 9.1 percent in July.

Saudi Arabia calls for Syrian reforms
Excerpt: Saudi Arabia's king has condemned a brutal crackdown on protests in Syria, recalling the country's ambassador to Damascus and calling on the Syrian government to implement political reforms. "What is happening in Syria is not acceptable for Saudi Arabia," King Abdullah said in a written statement on Monday. "Syria should think wisely before it's too late and issue and enact reforms that are not merely promises but actual reforms," he said. "Either it chooses wisdom on its own or it will be pulled down into the depths of turmoil and loss." (Saudi Arabia, bastion of free expression, that “loaned” a division of armored infantry to Bahrain to put down rioting a few months ago (and is still there?). Things in Syria must be a lot worse than we’re hearing. Ron P.)

Mystery pro-Romney donor revealed as former executive at private equity firm
Excerpt: The mystery donor whose $1 million contribution set off a furor over secrecy in politics has been identified as a longtime supporter of Republican presidential candidate Mitt Romney. Edward Conard, a former executive at Bain Capital, a private equity firm that Romney helped found, gave the contribution to a pro-Romney super-PAC called Restore Our Future through a shell corporation, W Spann LLC.

Worth Reading: Two Weekend Op-Eds Exemplify the Delusions of the Left and the Insights of Conservatives
This “tale of two editorials” draws quite a contrast. Ron P. Excerpt: An intriguing op-ed by Drew Westen, a leftist professor of psychology at Emory University, appears in today’s New York Times. What is surprising about Professor Westen’s article is that many of his observations make points that conservatives have said about President Barack Obama for quite some time. Take this paragraph, for example, in which Westen asks why Obama seems to “take both sides of every issue, encouraging voters to project whatever they want on him”: The most charitable explanation is that he and his advisers have succumbed to a view of electoral success to which many Democrats succumb — that “centrist” voters like “centrist” politicians. Unfortunately, reality is more complicated. Centrist voters prefer honest politicians who help them solve their problems. A second possibility is that he is simply not up to the task by virtue of his lack of experience and a character defect that might not have been so debilitating at some other time in history. Those of us who were bewitched by his eloquence on the campaign trail chose to ignore some disquieting aspects of his biography: that he had accomplished very little before he ran for president, having never run a business or a state; that he had a singularly unremarkable career as a law professor, publishing nothing in 12 years at the University of Chicago other than an autobiography; and that, before joining the United States Senate, he had voted “present” (instead of “yea” or “nay”) 130 times, sometimes dodging difficult issues. … The result was that the stupid American people — “stupid” is how I argue Westen feels about the people — thought that “Ronald Reagan was right, that government is the problem.” They thought this because Obama did not explain why we had to engage in deficit spending, and why we had to have universal health care. In other words, it was not Obama’s policies that were at fault, but only his failure to communicate.

Important: Every Single One: The Politicized Hiring of Eric Holder’s Voting Section
Sickening, but hardly surprising. ~Bob. Excerpt: For nearly a year, the Civil Rights Division rebuffed Pajamas Media’s Freedom of Information Act request for the resumes of attorneys hired into the Division during the tenure of Eric Holder. PJM was finally forced to file a federal lawsuit earlier this year. Only then did Justice relent and turn over the documents. The result leaves little wonder why PJM’s request was met with such intense resistance. The Department’s political leadership clearly recognized that the resumes of these new attorneys would expose the hypocrisy of the Obama administration’s polemical attacks on the Bush administration for supposedly engaging in “politicized hiring” — and that everyone would see just how militantly partisan the Obama Civil Rights Division truly is. Holder’s year-long delay before producing these documents — particularly when compared to the almost-instantaneous turnaround by the Bush administration of a virtually identical request by the Boston Globe back in 2006 — also shows how deep politics now runs in the Department. (…) This is the first in a series of articles by Pajamas Media about the Civil Rights Division’s hiring practices since President Obama took office.

Worth Reading: Where have all the liberals gone?
Excerpt: What happens when people who completely dominate the conversation have nothing to say? What happens when the people who talk the most and are listened to the most about our nation's most serious problems do not have a plausible solution to any of them? What I think happens is the current state of affairs. Let me explain. Sometime in the mid-1970s, near the end of the Vietnam War, liberalism in America died an intellectual death. Since that time, virtually every new idea - whether good or bad - about how to solve our most important economic problems has come from the right. Virtually nothing has come from the left. Do you doubt that? Okay, it's test time. Tell me what the liberal answer is to the problem of our failing public schools. ...tick, tick, tick ... I'm waiting ... tick, tick, tick ... Give up? What about the liberal solution to the failed War on Poverty? ... pause ... pause ... pause ... No luck there either? Okay, let's take what President Obama says is the biggest domestic problem we face. What is the liberal solution to the huge unfunded liabilities in Social Security and Medicare? ... Can't think of one? What about solving the problem of unfunded pensions and post-retirement health care benefits for state and local workers? ... Not even a vague suggestion or two? Wow. We seem to be really striking out. Well, can you tell me what a liberal income tax code would look like? Zip. How about a liberal international economic system? Nada. Note: I'm not asking if you have a liberal acquaintance who has an opinion or two on these matters. I'm asking if you can produce a solution that would be generally recognized as the liberal solution. … Let me clarify where I’m coming from. These “conservative ideas” are not self-evidently “conservative.” Sweden has a full-blown school voucher system, but most Americans probably think of Sweden as “socialist.” Thirty countries in the world have either partially or completely privatized their social security systems with private retirement accounts. Yet you would probably call most of these countries “welfare states.”

S&P downgrades US mortgage giants Fannie Mae, Freddie Mac
Excerpt: The fallout from the nation's credit downgrade continued Monday, as Standard & Poor's announced government-sponsored housing giants Fannie Mae and Freddie Mac were also getting their top rating slashed. The two government-sponsored enterprises saw their credit rating from S&P fall from AAA to AA+ after the rater dropped the nation's rating to the same level on Friday. Fannie and Freddie back roughly 90 percent of all new mortgages created in the United States.

A Detailed Look at Workforce Skill Shortages
Excerpt: As the United States continues to fight its way out of the Great Recession, more attention has been directed to the question of why is has taken so long for workers to find re-employment. In economist parlance, this is primarily a question of “structural unemployment.” This describes the type of unemployment that results from a mismatch of worker skills and the skills demanded by employers. As of April 2011, there were 13.2 million unemployed workers and 2.9 million unfilled job openings. In other words, April’s bulky 8.7% unemployment rate could have been lowered one percentage point (to 7.7%) if just half of the advertised job vacancies were filled by unemployed workers. Obviously, it is not realistic for every position to be filled immediately—it takes time for employers to find the right workers, and vice versa. But the odd pairing of high unemployment and high job vacancies illustrates a structural employment issue, which may have worsened in recent years.

Stimulus Optimists vs. Economic Reality
Excerpt: With the economy once again teetering on the edge of recession, policy makers will inevitably propose another round of stimulus spending. You can bet on it—just as you can bet that any such spending won't help the economy. From the beginning, the Obama administration has misdiagnosed the problem and implemented policies that are indefensible. Consider the problem of economic stabilization. In the old days, U.S. recessions were short and recoveries sharp: Between World War II and 1990, the average rate of growth in gross domestic product (GDP) in the five quarters after a recession was 6.8%. For the stimulus optimist, the temptation of moving some of that blockbuster growth into the recession is certainly overwhelming. But getting the timing right is a daunting—or even impossible—task. It's hard enough to call the onset of the recession correctly and arrange the spending so that it happens at precisely the right moment. But the successful policy maker must also remove the stimulus at a moment of unusually high growth. If not, the drag from disappearing stimulus could easily push the economy back into recession.

The Great Frack Attack: The War on Natural Gas
Excerpt: The development and growth of the Marcellus Shale natural gas industry is a major boom for Pennsylvania’s economy. The industry has directly and indirectly created tens of thousands of new jobs, with tens of thousands more to come if natural gas is allowed to continue in a safe and responsible manner; paid out billions in royalty and lease payment to landowners; and contributed hundreds of millions of dollars to state and local government tax coffers. Yet the development of this economic opportunity has become extremely controversial, with many politicians and advocates calling for new taxes and fees on gas drillers and even an outright ban on all drilling in the commonwealth. Much attention has been paid to the efforts of gas companies to influence the political debate through campaign contributions and lobbying efforts. But antidrilling activists—while claiming gas companies use their vast financial resources to weaken regulatory structures and silence poorly funded environmental groups— influence politicians through their own lobbying efforts and by spreading myths about drilling. Among the myths alleged about “Big Gas” is that drillers are flocking to Pennsylvania’s rich Marcellus Shale reserves, engaging in dangerous and highly polluting drilling activities, and shirking responsibility for damages while successfully avoiding paying taxes. These intentional distortions of reality have both misinformed the public understanding in Pennsylvania and the policy debate in Harrisburg. So who is behind the attack on natural gas? Why are they doing it? And how much are they spending on their efforts to hinder or prevent the extraction of natural gas in Pennsylvania? This policy brief identifies some of the top foes or obstructionists of an industry that has brought tens of thousands of jobs to the Commonwealth of Pennsylvania.

Despite the fact that S&P truly is blameless (as explained below) and only told the truth when it issued the downgrade, all of the mainstream press reports that I have read, including in the Wall Street Journal, are blaming Standard & Poor. Even the foreign press is blaming them. Instead of blaming the government for irresponsibly borrowing so much money no one could ever pay it back. After all, telling the truth -- that the US debt is too high to ever pay down and that so far (it is more money than exists on the planet!), no one seems willing to even try -- can erode stock trader confidence. Yes, the truth hurts and could prevent your buying the Brooklyn Bridge on the NYSE. This is bad?? For whom? Lying and pretending that our bonds are as solid as the Rock of Gibraltar will only hurt investors in the long run, and that includes retired elderly mutual fund holders. Apparently, the mainstream press (including the "conservative" press) wants hapless investors to be blindsided some day by a disastrous default that will leave them holding the bag. The Ruling Class is so used to "free money" they can't imagine living without it. --Don Hank. Excerpt: Let’s start with whose fault it is not: S&P. To recap: S&P warned early in the year that there was a risk of a downgrade. S&P, when the debate was entered in May, said that they needed to see $4 trillion in actual deficit reduction and that this was a “down payment” on the problem, not the entire solution (they’re right, incidentally.) S&P then re-iterated the warning when the debate got contentious. That’s (at least) three separate warnings that were intentionally ignored. S&P was not ambiguous nor did they blindside anyone. They told the government exactly what they needed to see and when in order to avoid the downgrade. They’re blameless. So who’s to blame?

29% Say Tea Party Members Are Terrorists, 55% Disagree
One hopes the members of the 29% have a close encounter with a real al Qaeda Jihadist so they will understand the difference between peaceful protest in a democracy and real terrorism. Only way to educate them. ~Bob. Excerpt: Several prominent Democrats and their media friends have charged the Tea Party with being economic terrorists during the congressional budget debates, but most voters don’t see it that way. Fifty-five percent (55%) of Likely U.S. Voters, in fact, say members of the Tea Party are not economic terrorists. A new Rasmussen Reports national telephone survey finds that just 29% believe Tea Party members have been terrorists during the budget debates, while another 16% are undecided.

Excerpt: It seems to me that, on any reasonable assessment, the gulf between the parties on fiscal policy is becoming more difficult to bridge, not less. Pessimism on that score seems entirely justified, so it’s hard to argue with S&P on at least that specific point. I do think the outlook for fundamental fiscal agreement before the 2012 election is bleak. After that, things could change dramatically for the better, or not. In any case, whether S&P is being fair or unfair to move at this juncture, the political standoff we’re in is, sadly, necessary right now, despite its costs. Americans are in the midst of a great debate on the future of our society. Everyone seems to agree that the outcome of the next election will have a decisive impact on what kind of country we are–or become. Will we retain our distinctively American characteristics, or move irrevocably toward the European model? A “grand bargain” on taxes and entitlements right now, would push us another big step down the European path. Like as not, it would simply set a precedent for ever more such “compromises” as the baby boomers continued to retire. By the time the entitlement crisis was fully “fixed” we’d be taxed at Scandinavian levels. At any rate, in the context of President Obama’s broader transformative efforts, it’s impossible to trust that a “grand bargain” would do anything other than enable the president’s ambitious plans, which are in no way agreed upon yet by the public at large.

Excerpt: Given that over the last quarter we’ve been running between 750,000 to 950,000 jobs per month short of that goal, what are your plans to boost the employment rate? You’ve announced you’re going on a Midwest bus tour beginning the week of August 15 to focus on job creation. How many jobs do you expect your bus tour to create? Isn’t it reasonable for Americans to conclude that your jobs-creation program consists primarily of borrowing money, deficit spending, and giving speeches? (There is no job creation plan. There is a vote-buying plan to reelect Obama and other statist progressives. ~Bob.)

Making Hay in Iowa
Excerpt: This year, the Ames contest of most consequence is between the tortoise and the hare -- between former Minnesota Gov. Tim Pawlenty and current Minnesota Rep. Michele Bachmann. He would be much easier to elect than to nominate; regarding her, reverse that. If Pawlenty's methodical long-march-through-the-cornfields strategy pays off in Ames -- that is, if he gets perhaps 4,000 votes -- he can partially upend the national media narrative that has cast him as already a spent force. His understanding of the stakes is apparent in the fact that he is investing $1 million in the Ames event -- about one-fourth of the $4.2 million he raised in the second quarter. Pawlenty emphasizes, as tortoises will, the long run. His campaign believes Bachmann is potentially a flash in the pan whose campaign is brittle because of her propensity to say peculiar things (e.g., about Concord, N.H., the Founders and slavery, John Wayne). Pawlenty's problem is the short run -- between now and Saturday.

The Taliban and the "Innocent Civilians" Continue to Express Their Gratitude for COIN in Afghanistan!
Excerpt: Monday morning quarterbacking combat from the operational vantage point continues to be the preferred parlor game for those without prior service or specific experience in combat operations - anywhere, or anytime. There have been many stories and even more commentators questioning everything from the mission to the load plan for the CH 47 (presumably) that crashed this past weekend. These stories and commentary are all based on partial explanations from military sources who are balancing a nation's "need to know" with operational security issues and are all, generally, pointed in the wrong direction. It has been typical for folks, again, without any specific experience, to lash out at lower level command whenever troops are killed and in the most aggravating and consistent way, refusing to question the legitimacy of decisions from the upper echelon command structure that placed them in a position to be killed to begin with. There should be a general desire to safeguard and secure our troops and their commanders and a corresponding groundswell of pressure placed on upper echelon military officers and politicians here at home. But for some perverse reason, the reverse seems to be true. Whether a single Chopper used to deliver the thirty eight who perished was a wrong choice is something that the local command is currently dealing with. There are, however a myriad of reasons why this decision was made and none of us may ever know the reasons why, nor do we have a "need to know". What is far more important is why this specific mission may have been launched to begin with. A report just out by Stratfor has a lot to say about what might have been the impetus for a mission to begin with; from the story

The REAL Problem With The Downgrade
Excerpt: I've not heard this yet in the MSM, and it's a serious miscalculation. Note that since the "downgrade" rumors started the ten year treasury yield has dove. You'd think it would do the opposite. You'd be wrong. The issue with the downgrade is not the fundamental risk of holding Treasuries. The difference between "AAA" and "AA+" is nearly immaterial. Rather, the problem is the capital calls it may generate within the banks and the impairment against the ability to raise capital from stock price declines. We're now back to stock prices last seen in October - in less than two weeks.

It's the Spending
Excerpt: On Friday evening, Standard & Poor's (S&P) downgraded the U.S. credit rating from AAA to AA+. As we and other conservatives warned, the spending reductions in the deal negotiated by President Obama to raise the debt ceiling were inadequate, and S&P reacted as we predicted but sooner. Neither Moody's nor Fitch, two other rating agencies, have downgraded federal debt yet, but they are not providing much rosier outlooks. Decades of over-spending and over-borrowing by the federal government have damaged America's creditworthiness. Congress after Congress, President after President, the federal government spent every penny it took in—and borrowed over $14 trillion on top of that—to try to keep happy the voters to whom the government made promises it could not afford. The government kept shifting the burden of paying the bills forward onto future generations.

Obamacare violations of personal liberty
Excerpt: Who can forget that rare moment of honesty during the campaign to pass Obamacare when Nancy Pelosi said “We have to pass the bill in order for you to find out what’s in it”? Now we have it and almost daily there are new revelations about the staggering extent to which our private lives and individual freedoms have been stomped on.

A Battle Royale Over Credibility
Excerpt: The Treasury Department and the Federal Reserve have already revealed what their strategy toward Standard & Poor's will be now that the agency has stripped the U.S. government of its AAA rating: to destroy S&P's credibility. They can make a pretty good case. It’s not just that S&P revealed its ratings process to be corrupt and deeply flawed during the subprime mortgage bubble, as it gave inflated AAA ratings to bad securities in order to satisfy its investment banking clients, according to the Financial Crisis Inquiry Commission report. It's also that the ratings agency appeared to go well beyond its ambit this time by taking it upon itself to assess, as it said in its report Friday, the "effectiveness, stability, and predictability of American policymaking and political institutions." (…) The problem with this line of attack is that S&P is not the first ratings agency to downgrade U.S. debt. It was preceded by a much smaller but arguably more credible agency, Egan-Jones Ratings Co., which on July 16 also reduced the U.S. credit rating to AA+, although it did not include a "negative” outlook. In an interview on Sunday, the managing director of Egan-Jones, Sean Egan, said that his own decision was driven by the worrisome size of America's debt to GDP ratio, nearly 100 percent by his estimate, and by the inability of policy-makers in Washington to come to any kind of intellectual understanding about the economic causes of America's debt crisis. (Attacking the messenger’s credibility is a standard leftist tactic used thousands of times before, often successfully (just look at the treatment of AGW skeptics, for example). It’s rather like saying a doctor had a low class standing at his graduation after he diagnoses you with a life-threatening disease. The reason denial won’t work this time is that the disease is visible to anyone who bothers to look. Of course, some won’t bother to look, and a few more will look but fail to see or won’t believe what they see. The battle against government’s living on credit has been going on since at least the early 70s; it won’t stop until no one is willing to loan them any more money. Then they’ll sell a few things. And then, the war will begin. And, it will all be someone else’s fault. Ron P.)

Life after D-Day
Excerpt: There is a lot of anger at the moment in the US over the embarrassment of the downgrade, as well as shock. I’m most amused by the shock, to tell the truth. S&P didn’t say anything yesterday that was not common knowledge and common sense. If you had to rate a potential investment that had an income of, say, $22,000 a year but had costs of $37,000 per year, a standing debt of $143,000, and contracted future debt that exceeded $1 million, would you give that investment a gold-plated AAA rating and buy their bonds at the lowest interest rate possible, or at all? Of course not, but that’s exactly the fiscal situation of the US, at a 100,000,000:1 scale. The anger is mainly misdirected. The media wants to blame the Tea Party, but the Tea Party wants to solve the actual problem — overspending and overcommitment to entitlement programs. The Tea Party wants to blame the Obama administration, and it deserves some blame for refusing to address the real structural problems of the US fiscal condition. But that fiscal structure far predates Barack Obama, both as President and as human being, and Congresses and White Houses of both parties have done little to address the real problems in Medicare, Medicaid, and Social Security.

Officer Henwood: A dedicated cop, Marine
Excerpt: His family wished he lived closer to them in Texas. His brother suggested he seek safer work in federal law enforcement instead of riding the street in a patrol car. But Jeremy Henwood loved San Diego, and he loved police work. And sometimes what you love can kill you. Henwood, 36, died early Sunday, hours after being shot in what police are calling an “assassination” while he sat in his patrol car at an intersection in City Heights. … That impression was based in part on the places Henwood had already been, specifically the Middle East, as a Marine. Henwood did three tours there, two in Iraq and one in Afghanistan. His last deployment ended earlier this year. “People recognized his leadership traits,” Jarvis said. “Even among his peers, they could see it in the way he carried himself.” Henwood was in the Marines for about 15 years, first in active duty and then in the reserves. On his last deployment, he was a captain with Combat Logistics Battalion 2, based at Camp Lejeune, N.C. The battalion moved supplies and personnel around Helmand province in Afghanistan.

S&P Executive Cites Obama's Characterization of U.S. Political System as 'Dysfunctional’
Excerpt: John Chambers, managing director of Standard & Poor’s, says politics played a part in S&P’s decision to lower the nation’s credit rating for the first time in U.S. history. “Although the political settings in the United States are still strong, they are not as strong as we had thought previously compared to some other highly rated governments,” Chambers told Fox & Friends on Monday. “There really is, well, as President Obama -- who characterized the political system as ‘dysfunctional’ -- I think that’s a good word. We got to a position where we were within ten hours of having a major cash flow problem. This is not what happens in other countries.” As for Democrats’ accusations that the tea party bears responsibility for the downgrade, Chambers said there is “lots of blame to go around.”

White House denial
Excerpt: The White House narrative on how the country lost its triple-A rating and began a descent toward Third World status goes something like this: Standard & Poors woke up Friday morning and out of the blue decided to downgrade Uncle Sam’s debt despite the administration’s best efforts to show the wrong-headedness of the S&P analysis. Don't buy it. Yes, last Friday saw lots of meetings in Washington with Treasury Secretary Tim Geithner & Co. haranguing S&P executives with phony evidence that they’re getting a handle on the nation’s $14 trillion and rising debt, and the rotten economy that has squeezed tax revenues. But the fact remains, federal debt is set to grow for the foreseeable future, even with the spending cuts imposed in the recent debt-ceiling deal.

America’s road to discredit
Excerpt: America is supposed to be the world’s economic and financial leader. How much more will we discredit ourselves before President Obama does his job: lead us out of a historic crisis that is gnawing through our growth, instead of digging us deeper? The "discredit" is literal. Standard & Poor’s on Friday slashed its rating on America's debt from AAA to AA+. The analysts noted that government debt (up 48 percent in three years) is jumping from 74 percent of GDP now to 85 percent in a decade, and maybe higher, to 101 percent. And S&P doesn’t see the current crew in Washington as able to change this course. Its analysts note that any progress -- “especially on entitlements” and taxes -- will be “contentious and fitful.” Hard to disagree. But the downgrade was still a shock -- the unthinkable happened. American bonds are -- were? -- the gold standard. Bankers “know” that Treasury securities are “risk-free” -- and measure other assets, from Brazilian bonds to Swedish stocks, in relation to this guide.

Exploration Raises Tensions in South China Sea
Excerpt: After appearing to make progress in cooling tensions over the South China Sea in recent weeks, Southeast Asia and China face the potential for more trouble ahead as oil and gas companies expand their exploration work in the contested waters. An aerial view shows the Pagasa (Hope) Island, part of the disputed Spratly group of islands, in the South China Sea located off the coast of western Philippines. In the latest move, an energy company controlled by Philex Mining Corp. of the Philippines plans to drill at least two wells and conduct more seismic surveys starting next year in a natural-gas prospect in the Reed Bank, one of the most-disputed areas in the South China Sea near the Philippines, Philex's chairman said Tuesday. That move comes after the Philex-controlled exploration company, London-listed Forum Energy PLC, wrapped up an earlier round of seismic surveying earlier in the year in the region, which has already been the subject of numerous dust-ups in the past. Other companies, including China National Offshore Oil Corp., or Cnooc, and Vietnam's state-run Vietnam Oil and Gas Group, or Petrovietnam, are also ramping up surveying efforts in the South China Sea. “There should be more exploration in the area," said Philex Chairman Manuel Pangilinan, whose Philex group owns 65% of Forum Energy, and who envisions spending as much as $86 million in the area between now and 2013. "Obviously, the issue will be a political one," he said in Manila. "My only request to the claimants, and this is the ideal situation, is allow us to do our work.” There was no immediate response to the plan from China, which also claims parts of the Reed Bank and which has opposed exploration there before. In one incident this year, Philippines authorities dispatched two military aircraft to the area after a Philippines oil-exploration vessel said it was being intimidated by Chinese patrol boats, though China has said it wasn't intruding. (The current Chinese dynasty, as I said in my book, Collapse, seeks to dominate Asia. ~Bob.)

White House Insider: "Everyone Stunned At How Little Barack Obama Understands"
I think a primary challenge is wishful thinking, as Democrats know that would surely elect a Republican. ~Bob. Excerpt: A quick update following the almost-concluded debt ceiling negotiations paints a fascinating picture of Democrats and Republicans agreeing on one thing – the leadership fiasco that is President Obama. Democrats are so upset in fact, serious whispers of a primary challenger to Obama are now quickly spreading within the party.

George Will Confronts MSNBC Analyst for Comparing Tea Party to Terrorists
Excerpt: We already brought you one clip of George Will form the ABC roundtable show “This Week,” in which he heavily criticized S&P and their downgrade of the U.S. That was a good clip. But there’s another clip from that program featuring Will that might cause some Tea Party conservatives to leap out of their seats and shout a hearty, Sunday-morning, “Hallelujah!” Steve Rattner is a regular guest analyst on MSNBC’s “Morning Joe” and a former Obama adviser. Recently he labeled the Tea Party “economic terrorist” for not — in his estimation — playing fair during the debt ceiling negotiations. According to him, it was “unreasonable” for Tea Party congressman not to consider any tax increases, and it was wrong for them to threaten not to raise the debt limit unless such increases were taken off the table.

The 10 states that will decide the presidency
Excerpt: New Gallup numbers tracking President Obama’s job approval rating in each of the 50 states makes clear that the 2012 election will almost certainly come down to ten swing states. In each of those ten states — Iowa, Pennsylvania, Florida, North Carolina, Virginia, New Mexico, Ohio, Nevada, Arizona and Colorado — the President’s approval rating is somewhere between 44 percent and 49 percent.

Spokesman of "moderate" and "largely secular" Muslim Brotherhood wants Mubarak's hand amputated for theft according to Sharia
Excerpt: According to the Qur'an itself: "As for the thief, both male and female, cut off their hands. It is the reward of their own deeds, an exemplary punishment from Allah. Allah is Mighty, Wise" (5:38). The spokesman for the Brotherhood, a group called "largely secular" by Obama's director of national intelligence, acknowledges they are Allah's own words, saying "there is no argument." But the spin is on, as Mahmoud Ghuzlan promises exceptions -- a moderate implementation, if you will, of a cruel and unusual punishment. The supposed room for exceptions should be no reassurance, but another demonstration of how Sharia is simply bad government. If exceptions are made, the law is not being applied, but its letter remains unchanged, and in this case, intolerable. Ghuzlan himself is talking out of both sides of this mouth in his attempts to reassure, saying there is no arguing with Allah's word, but then promising laxity in enforcing it. If a law can be selectively not applied, the government is corrupt, or there is something wrong with the law. In practice, those with money, power, and influence on their side will be better able to wiggle out of punishments, leaving the poor, marginalized, or unpopular to bear the brunt of what remains in any case a barbaric practice.

India: Muslims strip and beat convert to Christianity, disrupt prayer meeting and threaten to burn down her home
Excerpt: Apostasy is forbidden under Islamic law. According to Muhammad's own command, the penalty is death. That is why one observes violent responses against ex-Muslims and the denial of their freedom of conscience in areas geographically far removed from one another. "Muslim Extremists in India Attack, Threaten Christian Women," from Compass Direct News, August 6 (thanks to Weasel Zippers): NEW DELHI – Four months after a recent convert to Christianity from Islam in eastern India’s West Bengal state was stripped and beaten, about 50 Muslim extremists yesterday disrupted a prayer meeting held in her home, threatening to burn it down if she did not return to Islam, area Christians said.

Downgrade Looms for France
Sacré bleu ~Bob. Excerpt: With the US AAA rating gone, how long can France hold its AAA rating? I suspect not long. So where will that leave the ECB attempting to put a circle around Italy? Will Germany have to backstop all of Europe? Those are the new key questions and notice how the key question list keeps growing larger in size and significance.

Fast and Furious Official No Longer Going to Mexico as Attaché; Mexican Govt. Asks for Transcript​s of His Testimony
Excerpt: William Newell, who headed ATF’s Phoenix Division during the controversial operation dubbed Fast and Furious, won’t be going to Mexico as ATF’s attaché after all.
The agency has decided to nix that assignment before he even heads south. Instead, he’s been named special assistant to the ATF Assistant Director for the Office of Management in Washington. The reassignment comes at a time the Mexican Justice Department known as the PGR is reportedly conducting a criminal probe into the Fast and Furious Operation. It has also requested transcripts of Newell’s recent testimony before the House Committee on Oversight and Government Reform, according to two people familiar with the situation.

Quote
I have yet to see any problem, however complicated, which, when you looked at it in the right way, did not become still more complicated. – Poul Anderson

Mexican villagers attack alleged crooks, killing 6
Excerpt: Dozens of armed villagers surrounded the home of a suspected crime gang in southern Mexico, setting off a gunbattle that killed a child, a woman and four men, authorities said Saturday. The confrontation took place after a town assembly decided to arm 90 villagers and send them to threaten the group allegedly behind cattle thefts, rapes and murders, Oaxaca state's public security chief said in a statement. The people in the house responded by opening fire first, security chief Marco Tulio Lopez said. "When the suspected thieves saw the (villagers), the criminals shot at them, and the people responded because they were armed," he added. (Seems to work in Mexico. The victims don’t want to hear about the tough upbringing of the perps and that they were misunderstood, underserved, and disadvantaged and their classrooms were too large. They just killed them. End of problem! –TC)

Sunday, August 7, 2011

Political Digest for August 7, 2011

I post articles because I think they are of interest. Doing so doesn’t mean that I necessarily agree (or disagree) with every—or any—opinion in the posted article. Help your friends and relatives stay informed by passing the digest on.

Important: United States of America Long-Term Rating Lowered To 'AA+' Due To Political Risks, Rising Debt Burden; Outlook Negative
As Joe Biden might say, this is a big F-ing deal! And very bad news for taxpayers, however expected. ~Bob. Excerpt: We have lowered our long-term sovereign credit rating on the United States of America to 'AA+' from 'AAA' and affirmed the 'A-1+' short-term rating. We have also removed both the short- and long-term ratings from CreditWatch negative. The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics. More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011. (The U.S. is no longer the premier economy in the world, and we have become a laughing stock in much of the world. The debt fiasco last week between Congress and Obama set the stage for this downgrade, but Obama is the main problem as he has been on a spending spree for the last 2 1/2 years. This is the first President who has had a rating downgrade. There must be structural spending reform to solve our fiscal problems, but this will not happen as long as the Democrats control 2/3 of the government. In addition, Obama’s socialist ideology will preclude any positive changes between now and the 2012 election, so it is going to be a problem for many Americans who will need to borrow money. This is will not be good for our US debt payments as interest rates will rise. Our annual interests payments are headed very quickly toward $1 Trillion. This may also impact the stock market Monday, which has already taken a huge hit this week. Hopefully, this downgrade will be just another reason Obama is defeated in the 2012 election. The Treasury Secretary should be fired now. -- Geoff Higginbotham, MGen USMC (Ret.))

Comment on the downgrade
Revenge has a sweet and sour taste, as you can infer from the FedUpUSA article below. The few pundits willing to tell the truth the last 2 decades or so -- voices crying in the wilderness -- have been ignored. You said "ah, it can't be that bad," and went on thinking our most important job was to get Republicans elected, even though they kept the borders open and spent so much that drunken sailors were offended at the comparison. (The GOP told you debt didn't matter as long as there was economic growth. The "conservative" media went along with the lie). Part of this vindication -- the sovereign debt downgrade, absolute proof that these lone pundits were right on target -- has to taste good. But on the other hand, knowing that your fellow Americans are about to get deathly sick from an overdose of stupid pills isn't quite what anyone wanted either. Pundits are teachers and when the student doesn't learn the lesson despite all your efforts, teachers tend to blame themselves. We were hoping that somehow, somewhere along the way -- like when simple math showed our debt plus unfunded liabilities could never be paid for because it would take significantly more money than exists on the planet or ever will exist to do so -- people would finally wake up. Like when Saddam Hussein had to go into hiding and finally admit to himself that he hadn't won the war. But even that was futile. Simple math doesn't appeal to rocket scientists who graduated from the most expensive institutions of Marxist higher indoctrination. I am in fact wondering whether actually literally drowning in a sea of debt is proof enough that people need to live within their means or perish. Could these people actually go under the waves one last time and think: NOW is when they rescue me? I don't know, and I can't believe I am saying that....Are we in a Kafka novel? --Don Hank

And so it begins...

More on the downgrade
I know it isn't good to admit it, but I am relieved. Along with pundits who know a lot more about finance than I do, I have been warning of this impending downgrade and its implications and people were ignoring all of us, calling us alarmists. Well, you were wrong and we were right, and I don’t mind telling you so. Americans don't know much about finance and even the most aware need to be reminded. Here is a brief schematic showing why a downgrade is HORRIBLE news: 1--A major rating agency downgraded US sovereign debt. Here is the time sequence as I understand it: First, the rating agencies and a lot of financial pundits (but not the mainstream media -- you were probably hanging on every word of the WSJ, the NYT, etc, right? Tough luck!) said a downgrade was inevitable if the US government didn't stop spending. 2--Instead of cutting spending, Congress held a political theater skit in which it pretended to be cutting spending (again, you were reading what a great deal this was), but the amounts were insignificant and most were based on planned, inevitable structured cuts that would have happened anyway (sort of like me promising that I will make the sun rise tomorrow and expecting you to thank me). On top of this insult, both parties agreed to raise the already staggeringly high debt ceiling of 14 trillion (debt was 10 T under Bush and that was much too high). This was tantamount to jumping off the Grand Canyon and hoping to grow wings before splattering against the ground. This proves there are no longer 2 parties in the US. America doesn't need a third party, it needs a second. 3--Moody's issued a minor downgrade by tacking a negative outlook on the AAA rating. Congress didn't even notice and the mainstream media put it on the back page. 4--But then, Standard & Poors fired a big warning shot over the government's bow downgrading the AAA to AA+. Such downgrades of sovereign debts in other countries have led to an interest hike in the countries' bonds. So what, you say? 5--"So what?" is definitely the wrong answer. Even a slight interest hike on the dizzyingly high debt of 16 trillion could easily translate into an amount that would cause the US to funnel the lion's share of its total spending into servicing the debt. There would be precious little left to spend on existing programs and liabilities like Medicare, social security, welfare, food stamps, etc. AND, nota bene: There would be no suckers left to buy our bonds. Bernanke could keep printing money all he wants, but very shortly, the dollar will be worth much less, if not worthless. We are staring down the barrel of a Howitzer right now. We actually COULD default. Obama, the Dems and the Fed have proved that government can't create jobs or even control one iota of the economy. It never did and never could. We were supposed to learn that lesson during the existence of the Soviet Union and Mao's debacle. But we didn't learn a single thing from these object lessons. We kept reading about "global warming" and "social justice." 100 million people died in vain. Now we will learn it, one way or the other. Don’t cry. You did it to yourselves, America. --Don Hank

Must read: Brokest Nation In History On Edge Of Armageddon
Excerpt: On Thursday, in honor of Barack Obama's 50th birthday, the Dow dropped 10 points for every year he has walked among us. It was the ninth-largest drop in history. We should be relieved he wasn't turning 80. The markets are apparently concerned that the entire global economy might be "stalling." You don't say? Observant fellows, these market chappies. And yet, in a certain sense, these are still the good times. At the end of the week, U.S. Treasury yields plunged to Eisenhower-era rates. America, explained Ethan Harris of Bank of America Merrill Lynch, "still gets the safe haven money." That's to say, as crazy as Washington is, Europe is perceived to be crazier. In confirmation of the point, over in Italy, which is (believe it or not) a G7 economy, police raided Moody's and Standard & Poor's over allegations that all the meanie things that the rating agencies have been saying about the Italian economy were having an impact on Italian stock prices. Apparently that's a crime in Italy. They're not yet shooting the messenger. But they are dragging him through the streets in chains pour encourager les autres. Good luck with that. ... So they usually say, "Well, fortunately I won't live to see it." And I always reply that, unless you're a centenarian with priority boarding for the ObamaCare death panel, you will live to see it. Forget about mid-century. We've got until mid-decade to turn this thing around. Otherwise, by 2020 just the interest payments on the debt will be larger than the U.S. military budget. That's not paying down the debt, but merely staying current on the servicing — like when you get your MasterCard statement and you can't afford to pay off any of what you borrowed but you can just about cover the monthly interest charge. (I've per-ordered his new book. Nice to know I'm not alone in my views. ~Bob.)

World leaders confer on debt crises this weekend
Excerpt: Global leaders on Saturday arranged a round of emergency calls to discuss the twin debt crises in Europe and the United States that are causing turmoil in financial markets. After a week that saw $2.5 trillion wiped off global stock markets, they are under pressure to show political leadership and reassure markets that Western governments have both the will and ability to reduce their huge and growing public debt loads. French President Nicolas Sarkozy, who chairs the G7/G20 group of leading economies, conferred with Britain's Prime Minister David Cameron ahead of a call planned for this weekend by G7 finance ministers and central bankers. "They discussed the euro area and the U.S. debt downgrade. Both agreed the importance of working together, monitoring the situation closely and keeping in contact over the coming days," a spokesman for Cameron said.

AP sources: Crash kills members of SEAL Team 6
Excerpt: U.S. officials tell The Associated Press that they believe that none of the Navy SEALs who died in a helicopter crash in Afghanistan had participated in the raid that killed Osama bin Laden, although they were from the same unit that carried out the bin Laden mission. Sources say that more than 20 Navy SEALs were among those lost in the crash in Afghanistan. The operators from SEAL Team Six were flown by a regular Army crew. That's according to AP military sources.

Did Biden’s Loose Lips Sink a Team 6 Airship?
Excerpt: After Bin Laden was killed, Robert Gates was insistent that nothing be revealed about the unit that accomplished the deed. But one man could not keep his mouth shut: Joe Biden, who credited the SEALs in a speech: Let me briefly acknowledge tonight’s distinguished honorees. Admiral James Stavridis is a, is the real deal. He can tell you more about and understands the incredible, the phenomenal, the just almost unbelievable capacity of his Navy SEALs and what they did last Sunday. Further irresponsible leaks from the Obama administration revealed the unit involved, causing the unit members to fear for their safety and that of their families: The Department of Defense is looking into ways to “pump up the security” for the team of Navy SEALs who helped kill Osama bin Laden after the commandos expressed concern for their safety and the safety of their families, Defense Secretary Robert Gates said Thursday. Gates made the comment in response to a question at a town hall meeting at Camp Lejeune, North Carolina. A Marine asked what measures were being taken to protect “the identities and the lives” of the SEALs involved in the takedown of bin Laden in Pakistan a week ago, as well as other troops deployed in the region, from the threat of retaliation. “We are very concerned about the security of our families – of your families and our troops, and also these elite units that are engaged in things like that. And without getting into any details … I would tell you that when I met with the team last Thursday, they expressed a concern about that, and particularly with respect to their families,” Gates told the audience. “Frankly, a week ago Sunday, in the Situation Room, we all agreed that we would not release any operational details from the effort to take out bin Laden. That all fell apart on Monday, the next day.” (I suspect the crash in Afghanistan is the kind of bad luck that happens in combat. That said, the operational security of this administration, aided by the media which are happy to publish details of operations, then stories about the tragic deaths that follows, is abysmal. ~Bob.)

Michael Yon on the loss of the Seals

Excerpt: A U.S. and Afghan-coalition force yesterday killed a Taliban leader and one suspected insurgent during a security operation in the Baraki Barak district of Logar province, military officials reported. Sheen Abdul Rahman was a Taliban leader who directed more than 70 fighters to conduct roadside bomb, landmine and other attacks against Afghan and coalition forces. He also trained Taliban fighters in building improvised explosive devices or IEDs. Afghan members of the combined force located Rahman, who was armed with an AK-47 rifle. Rahman was engaged and killed when he presented a threat to the force. ... There is also detailed evidence uncovered that Iran's Revolutionary Guard is transferring long-range rockets to Taliban elements in Afganistan. British forces intercepted a shipment of 48 122-millimeter rockets moving through Nimruz Province, near the Iranian and Pakistani borders.

Great column: No surprise: Disappoint-mints strike liberals as bad taste
Excerpt: Corrections and clarifications: In a Page 2 column on Wednesday, John Kass incorrectly asserted that by raising the federal debt ceiling by $2.4 trillion, President Barack Obama had grabbed "reality by the hair" and kicked it repeatedly "in the behind." But Thursday's stock-market plunge of more than 500 points proves that reality remains immune to the president's charms. The Tribune regrets the error. So what do you give a beleaguered president who just ate a mess of birthday barbecue with his friends from Chicago? Yes, Disappoint-mints, the breath mints with President Barack Obama's likeness on the cover.

Worth Watching: Afterburner with Bill Whittle: Rich Man, Poor Man
Who is poor. Good short video. ~Bob.

Syrian Protests: Hama Shelled By Tanks
Excerpt: Although there has been a near-total communications blackout in Hama, witnesses have painted a grim picture of life in the city. "People are being slaughtered like sheep while walking in the street," a resident said Thursday, speaking by phone on condition of anonymity for fear of reprisals. There were also fears of an intensified assault on a second city, the oil center of Deir el-Zour in the east, where tanks have been deployed at entrances since earlier this week. Rami Abdul-Rahman, head of the London-based Observatory for Human Rights in Syria, said a quarter of the city's population of 600,000 have fled recently. Friday has become the main day for protests in Syria, despite the near-certainty that tanks and snipers will respond with deadly force. Protests on Friday spread from the capital, Damascus, to the southern province of Daraa, the central city of Homs and in Qamishli, near the Turkish border.

Government Gone Wild

And now for the real economic crisis
Excerpt: In ending the immediate debt-ceiling crisis this week, Congress did nothing to address the United States' long-term economic crisis. Its latest spending cuts won't even cover the debt we'll rack up this year. The long-term crisis is threefold: We've amassed a huge debt; we're running a massive annual deficit; and the economy has essentially flatlined: It grew at an annualized rate of less than 1 percent in the first half of the year, and but for population growth it probably would have shrunk slightly. All three have roots in an almost pathological American positivism - the very same that led to both the dot-com and housing bubbles. We seem to believe that "American exceptionalism" exempts us from the rules of economics. Decision time, folks. Will we embrace painful realism and do what's necessary to survive? Or will we simply close our eyes and hope the monster doesn't see us? The monster, incidentally, is default followed by Great Depression II. (Followed by social collapse. ~Bob.)

Ezra Klein Learns a Lesson on How Economics Work

We Just Lost Another Junkie
Excerpt: Heroin addiction isn’t a disease, as Russell Brand so despondently put it. It’s an indulgence—like obesity, but in reverse. Russell says we need to stop treating junkies like criminals and treat them “as sick people in need of care.” But England already treats them like sick people, with little success. In Scotland, that approach has fallen flat on its face like a junkie on the nod. “Drug addicts don’t need kid gloves. They need an iron fist.” Drug addicts don’t need kid gloves. They need an iron fist. I know this because I’ve watched a dozen heroin addicts die over the years, and the ones who survived always say the same thing: “I can’t believe you didn’t just punch me in the face.” If you know a drug addict, there will be that moment when they say they’ll call you back and then they don’t. Then you call them, but there’s no answer. What do you do? I’ll tell you what you do: nothing. If you charge over there and kick their door down to make sure they’re OK, you will have tagged yourself as a mark. The junkie then knows you can be relied on to help him get out of trouble, AKA loan him money. They will lie to your face and steal from you like common politicians because the drug has taken over their brain like a parasite. I’ve known junkies who committed crimes even when they knew they were going to get caught because, as one put it, “I didn’t care. I was so junk-sick, all I cared about was getting money to get high right now. What happened ten minutes later was totally irrelevant.” (Having been on the receiving end of junkie lies and theft, I feel this writer's pain. ~Bob.)

IRS: Not enough rich to cover the deficit
Excerpt: They do not have the money. A report from the Internal Revenue Service found that the rich — 8,274 people with incomes of $10 million per year or more — earned a total of $240 billion in 2009. Even of you confiscated every dime they earned, you would barely have enough money to cover government spending for 24 days. Of course, about a quarter of that money already goes to the federal government for federal income. So make that 18 days. Another 227,000 people earned $1 million or more in 2009. Millionaires averaged taxes of 24.4% of their income — up from 23.1% in 2008. They, too, did not earn enough money to come anywhere close to covering the annual deficits that are $1.5 trillion a year….Individual tax collections totaled $1,175,422,000,000 in 2009 — or 15.4% of all income. Doubling federal income taxes for everyone would still leave us $400 billion or so shy of balancing the budget.

Dear Members of Congress,
From a joke e-mail: The last decade I mismanaged my funds, and this year my family and I cannot decide on a budget. Until we have come to a unified decision that fits all our needs and interests, we will have to shut down our checkbook and will no longer be able to pay our taxes. I'm sure you will understand. Thank you very much for setting an example we can all follow.

The Regulatory Recession
Excerpt: …[T]axing and spending tell only part of the story. Much of the growth of government occurs off-budget, through regulations that often go largely unnoticed. As Wayne Crews, Vice President for Policy here at the Competitive Enterprise Institute, notes in his annual report, “Ten Thousand Commandments,” hidden regulatory costs approach $1.7 trillion this year. Those costs slow innovation, hampering the economy and job growth.

Where Have All the Liberals Gone?
Excerpt: What’s happening isn’t that conservatives have all the good ideas or that they are smarter than liberals. What’s happening is that conservatives are trying to solve problems and liberals aren’t. Ironically, if liberals were equally intent on finding solutions, the two sides might agree 90% of the time! But as it is, liberal commentators have been largely on the sidelines in almost all the important public policy struggles. The school choice battle has been raging all over the country for the last two decades. But that has been mainly a battle pitting conservative reformers against special interests (the teachers unions). For the most part, liberals haven’t really been involved. Similarly, the struggle for welfare reform, the flat tax, Social Security privatization, etc., has cast conservative reformers against special interests and entrenched bureaucracies. Liberals have been mainly irrelevant. (Well, Obama was there to help the teachers unions in DC at the expense of poor black kids in the charter school fight. ~Bob.)

Left-Wing Politico Says Obama's Cooked
At first glance, I read "cooked" as "crooked." Wonder why. ~Bob. Excerpt: The politics of the debt fight were a drag for President Barack Obama, yanking his popularity to new lows. Here’s an even bigger drag: Obama emerges from the months-long fracas weaker – and facing much deeper and more durable political obstacles – than his own advisers ever imagined. The consensus has been that for all his problems, Obama is so skilled a politician – and the eventual GOP nominee so flawed or hapless — that he’d likely be re-elected. Don’t buy into it. This breezy certitude fails to reckon with how weak his fundamentals are a year out from the general election. Gallup pegs his approval rating at a discouraging 42 percent, with his standing among independents falling nine points in four weeks.

Obama and the Narcissism of Big Difference​s
Excerpt: Whatever the rhetoric that preceded this week's deal, the debt-ceiling debate was never really about the debt at all. It was about the terms on which the debate would continue. The "two different worldviews" that divide Washington, explains Eric Cantor, are too far apart for anything more than an armistice. Still, listening to the House majority leader—who says the deal is "not perfect" but "there were some achievements"—it's remarkable that the two parties were able to agree even to its modest terms. The "philosophical starting point" of today's Democrats, as Mr. Cantor sees it, is that they "believe in a welfare state before they believe in capitalism. They promote economic programs of redistribution to close the gap of the disparity between the classes. That's what they're about: redistributive politics." The Virginian's contempt is obvious in his Tidewater drawl. "The assumption . . . is that there is some kind of perpetual engine of economic prosperity in America that is going to just continue. And therefore they are able to take from those who create and give to those who don't. We just have a fundamentally different view."

Let’s try new ways to go bankrupt
Excerpt: Uncle Sam now owes more on his credit cards than he makes in a year. The national debt passed the total US GDP this week. Mull that over for a bit. Now mull this over: Until the budget deal this week, the federal government borrowed 40 cents for every dollar it spent. And the budget deal didn’t do very much to change that. It “cut” $2 trillion over 10 years, which means Uncle Sam will overspend slightly less. If we hold to the deal -- and who among us doubts that Congress won’t keep its word? -- spending will “only” increase by $1.8 trillion over 10 years. That’s because in the topsy-turvy, laugh-clown-laugh world of “baseline budgeting,” we’ve been talking about trimming the rate of increase. Think of Uncle Sam walking in a wind tunnel leading to insolvency. The cuts increased the headwind he has to walk into, but they don’t do anything like force him to turn around. More importantly, there are no structural reforms. It’s the difference between trimming the grass and re-landscaping the lawn. Now, the one great advantage the forces of the status quo have had in the budget debates over the last year is that they like the current system. Recall that the Democrats’ preferred position was a “clean” debt-ceiling hike (no spending cuts at all), and President Obama’s original budget called for increasing the deficit and extending the status quo until he was re-elected, if not into retirement. In May, when House Minority Leader Nancy Pelosi was asked what her plan was to fix Medicare, she responded, “We have a plan, it’s called Medicare.”

S&P Goes Tea Party
Excerpt: Big headlines for a Friday night: “U.S. Loses Top Credit Rating!” Yes, as most now know, Standard & Poor’s went ahead with its warnings of the past weeks and downgraded the sovereign debt of the United States government from its pristine triple-A to a still stellar but one notch less so AA+. And after a miserable week in global equity markets that was almost as ugly as it gets, a week that began with the conclusion of a universally reviled debt-ceiling deal, the late-night downgrade was the fitting end. The symbolism is undeniable. This is the first downgrade in history, as commentators rushed to remind us. (…) The worst part of the downgrade is this: S&P spent considerable time in the body of their explanation about debt and GDP and growth. But they didn’t lead with that. That wasn’t the kicker. No, this was: “the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges.” The company assailed the Washington culture of “brinkmanship” so in display during the debt ceiling fiasco, and used that as the primary reason to take us down a notch. (The view from the left. Notice how the attack is structured: first is the complaint—from the White House—that the math is wrong, followed by ‘it won’t really hurt us anyway,’ followed by ‘who put these guys in charge,” followed by attacking the methods of S&P’s decision-making [perhaps we should tell them it’s settled science], followed by ‘how dare you criticize our decision-making process’ [even though I’m comfortable criticizing yours], and overall leaving the impression that credit rating should be regulated by some government agency. Have you ever tried to get back the $20 you loaned to someone who didn’t want to pay even though he had the money? Doesn’t all this sound familiar? If it wasn’t the future of our country, it’d be funny. They really can’t see the problem. The Chinese may be willing to explain it to them. Ron P. Ron, you will recall that red-headed Marine who challenged me to a chess game on a $5 bet in 1965, when we were at MCRD electronics school in San Diego, and didn't pay after I crushed him? I always wondered what happened to him. Now I know--he's working for the Feds. ~Bob.)

China demands U.S. 'live within its means'
Excerpt: China called on the United States to "cure its addiction to debts" and "learn to live within its means" in a searing commentary published Saturday by the official New China News Agency in response to Standard & Poor's historic downgrading of the U.S. government's credit rating a day earlier. China, the largest foreign holder of U.S. federal debt, blamed "short-sighted political wrangling in Washington" for creating the current financial morass that now threatens to undermine the global economy. "China, the largest creditor of the world's sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China's dollar assets," the commentary said. (It appears the Chinese ARE willing to explain it to the left. Ron . But they won't listen, ~Bob.)

Bam’s surprise charisma deficit
Excerpt: One thing is clear in the aftermath of the debt-limit debate: President Obama has lost his glamour. The alluring icon of hope and change has become just another pol, derided by his supporters as well as his opponents. As one headline succinctly put it: “Obama succumbs to the ways of Washington.” Most striking was how irrelevant the president seemed to the entire debate. Obama didn’t present his own alternative to the various congressional plans or make a case for a particular policy. When he tried to address the public, he came off as condescending, self-interested and detached. His pulpit proved anything but bully. Contrary to some of the headlines, however, the crisis didn’t mark a dramatic shift in the president’s standing. Gradual disillusionment set in long before the debt-ceiling fight. Back in October, a Bloomberg National Poll asked people who’d at some point been Obama supporters how they now felt about him. Forty-two percent said they were less enthusiastic than they’d once been, with 35 percent still supporting the president at least some of the time and 7 percent either no longer supportive or actively opposed to him. In the 10 months since, the president’s general approval ratings have been trending down, hitting a new low in Gallup’s survey last week. And Obama’s real weakness, according to Gallup, comes from eroding support among moderates. Less than half of them now approve of the job he’s doing, compared with 59 percent in early June. (Anyone not totally naive saw this in the fall of 08. ~Bob.)

No Limitations-adapt, improvise and overcome
Great picture. ~Bob.

Toronto: Synagogue spray-painted with swastika, "Islam will rule"
Excerpt: The Beth Tikvah Synagogue in Toronto, Ontario, was vandalized late Thursday night. Staff members of Beth Tikvah Synagogue found a swastika and the words "Islam will rule" spray-painted on one of the exterior walls of the temple, Canada's CTV reported on Friday. The report, quoting a statement published by the Canadian Council for Israel and Jewish Advocacy, said that the Toronto Police were investigating the incident and that security around the synagogue and been enhanced.

Tariq Ramadan openly calls for Muslim colonization of the U.S. -- Dallas, July 27, 2011
Excerpt: French journalist Caroline Fourest has published a book-length study of Tariq Ramadan's sly duplicity, Brother Tariq. Fourest concludes that this much-lionized putative Muslim Martin Luther is actually anything but a reformer: in reality, Ramadan is "remaining scrupulously faithful to the strategy mapped out by his grandfather, a strategy of advance stage by stage" toward the imposition of Islamic law in the West.

Muslim girl, 19, ‘stoned to death after taking part in beauty contest’
Yet another Muslim victim of Allahmurder. Pretty girl, very young. ~Bob. Excerpt: A teenage Muslim girl was stoned to death under ‘Sharia law’ after taking part in a beauty contest in Ukraine. Katya Koren, 19, was found dead in a village in the Crimea region near her home.

71% Support Five-Year Lobbying Ban For Ex-Members of Congress
Excerpt: Most voters don’t think members of Congress should be allowed to lobby for several years after they step down. A new Rasmussen Reports national telephone survey of Likely U.S. Voters shows that 71% believe members of Congress should be banned from lobbying for five years after they leave office. Only 17% disagree, while 12% are undecided. (To see survey question wording, click here.) Most voters across virtually all demographic lines agree with a five-year ban on lobbying for former congressmen.

More Obama Spending Won’t Do It. And stocks know it
Excerpt: There he goes again. Out on the campaign trail, President Obama is proposing more federal spending as his answer to sluggish growth and jobs. That won’t do it, Mr. President. He wants more infrastructure spending, undoubtedly in the form of an infrastructure bank. That’s a terrible idea. It’s borrowed from Latin America, where bloated and corrupt bureaucratic construction agencies have helped bankrupt any number of countries in the past. He wants to lengthen 99-week unemployment insurance, although numerous studies have shown that continuous unemployment benefits are associated with higher unemployment. And he wants to extend the temporary payroll tax credit, which is not a permanent reduction in marginal tax rates, has no incentive effect, has not worked so far, and is really a form of federal spending -- not real tax relief.

Group Says It Hacked U.S. Law Enforcement Websites
Excerpt: The group known as Anonymous says it has hacked some 70 law enforcement websites across the southern and central United States in retaliation for the arrests of its sympathizers in the U.S. and Britain. The hacking group also claims to have stolen 10 gigabytes of data, including emails, credit card details, and other information from local law enforcement bodies.

USA Today poll on gun ownership
Vote early and often. ~Bob

The Fallacy of Compromise
Excerpt: Again and again, we are told that we must make a compromise between our vision of freedom and the left's vision of slavery. It is not possible to be slightly enslaved or partially shackled. Either we will emerge victorious and free or we will lose and our children and grandchildren will be born into slavery.

Barack Obama and the Betrayal of Black America
A little old, but of interest. ~Bob. Excerpt: When Barack Obama was elected as the president of the United States, black liberals dreamily believed that the numerous maladies in the black community would cease to exist. They believed that his election was indicative of a vigorous wind of political and social change that was blowing across the country. Barack Obama himself vowed that his election would demarcate the conclusion of grisly "politics as usual" from the commencement of political and democratic freshness. However, as this administration continues on, it is abundantly clear that Obama has not only failed to deliver in a general sense, but he has also completely betrayed his most loyal constituency -- the black community. 

Gunwalker: It Must Have Been Eric Holder... Or higher. An informed examination of the facts leaves no other answer.
Excerpt: Now that the debt ceiling debate is over and done, let’s turn our attention back to Operation Fast and Furious and its alleged sister operations. The multi-agency operation (or operations) of the U.S. government allowed thousands of guns to be supplied to Mexican drug cartels, while American federal law enforcement effectively provided the straw purchasers and smugglers with the cover to operate with impunity. Despite the tens of thousands of words of outrage written about the Obama administration’s botched Operation Fast and Furious, most of the focus has been on the horrific impact of the program as measured by the number of firearms smuggled over the border and the number of lives lost. Some attention has been consequently paid to the potential political and criminal impact of the operation and cover-up within the Department of Justice. Sadly, the media has focused very little attention on the probable origins of the plot, or why Gunwalker was created as an adjunct of the longer-running and more successful Gunrunner campaign. Of course, that may not be entirely true. The crack investigative reporters of print, network, and cable news organizations may very well have done the research and followed the various clues about the origins of Gunwalker to their logical conclusion, and then simply decided that the most probable story was one they not dare tell. The story is this: no competent federal law enforcement officer would ever have concocted an operation as obviously doomed to catastrophic failure as Operation Fast and Furious.

What? Gov’t Let Cartel Smuggle Drugs in Exchange for Intel?
Excerpt: Remember when things like this were just the realm of conspiracy theorists? A Sinaloa drug cartel member is claiming that the federal government allowed the cartel to smuggle cocaine into the United States in exchange for intelligence information about rival cartels. Attorneys for Jesus Vicente Zambada-Niebla claim that in addition to being the drug-trafficking son of a Sinaloa cartel kingpin, Zambada was a Drug Enforcement Administration informant who was assured he could continue smuggling drugs in exchange for information by his DEA handlers. Zambada’s defense team is claiming that because he was an informant and promised immunity, charges against their client should be dropped. According to the Houston Chronicle, U.S. District Judge Ruben Castillo has given the government until September to respond.

Sign Petition Against Unilateral Declaration of Palestinian State!

Editorial: It’s not Amazon that’s greedy
Excerpt: How perverse is it when wanting to keep money that you've earned is considered being greedy? Amazon, the online retail giant, has been castigated for not collecting sales taxes in states, including California, where it has no physical presence, and therefore no legal requirement to do so. Nevertheless, critics would have us believe Amazon has no right to do what nearly every taxpaying American probably does routinely – minimize how much of its income is handed over to the government. One headline labeled it, "Amazon's shameful California tax dodge." Shameful? Hardly. It's very likely the critics, just like most people and no doubt like Amazon, take advantage of every legal tax break available to them. No one is obligated to pay more than the law requires. Is it shameful to pay only what's required? (well, I want that greedy Obama to give me half the proceeds from his book sales, because mine are not selling nearly as well. I call it "The Campaign for Literary Justice." And I'm willing, in a bi-partisan manner, as the only adult in the room, to compromise on 25%. But will he budge? No. ~Bob.)

Semper Fi - Trace Adkins