The Latest Line of Koch

According to a largely overlooked report in The Washington Post, the “Koch network” is “turning away from partisan politics,” which strikes us as an intriguing development. The story has significant implications for President Donald Trump and the rest of the Republican party, and will surely be of hopeful interest to the Democratic party and the rest of the left, and it has a special local interest for us.
The multi-billionaire and big-bucks political donor to conservative causes Charles Koch has long been a leading villain of the conspiracy theories spun on the left, much as multi-billionaire and big bucks donor to liberal causes George Soros is the bogeyman of all the right’s conspiracy theories, which we’ve always found amusing.
It’s hard for us to believe that the headquarters of the diabolically ingenious organization secretly controlling everything is Koch Industries, which is located right next door to where we attended elementary school on the outskirts boring old Wichita, Kansas, and the company has always been a good neighbor. The local zoo’s award-winning ape exhibit was paid for by the Koch family, you can’t go to the city’s surprisingly excellent art museum or symphony orchestra or musical theater troupe without seeing Koch’s generosity prominently thanked in the program, the Friends University dance department that provides some of the the best of the city’s ballet offerings was started by the Fred and Mary Koch Foundation of his parents, and if you’re lucky to attend a Wichita State University Wheatshockers basketball game they play in the very swank Charles Koch Arena, and the family has funded some charities for the poor as well. Wichita’s still a small enough enough town that we’ve had a couple of personal encounters with the internationally notorious Charles Koch, who lives not far from our parents’ swank retirement home over on the east side, and we’ve found him an affable fellow.
Koch has also spent a considerable chunk of his vast fortune funding anti-tax and pro-free market causes here and around the country and the world, which is why the left hates him so, but for the most part that’s been fine with us. The “tea party” movement that briefly fought for fiscal sanity was a genuine grassroots movements, but there’s no denying it was fertilized a bit by Koch’s money, and although the left recoiled in horror we wish it were still around. We’ve voted for most of the politicians that Koch has funded around here, and rooted for most the of ones he funded in other states and districts, and generally agree with his red-in-tooth-and-claw sort of capitalism. He’s carefully stayed out of the abortion politics and other social issues that are so contentious around here, and we think he’s been wise to do so.
There have been the occasional differences of opinion. Koch was a big backer of Gov.. Sam Brownback’s admittedly radical tax-and-budget-slashing agenda, which we eagerly voted for, but he continued to back it even after we had to begrudgingly admit it hadn’t worked out quite as promised. We’re also the sort of traditional Pax Americana Republicans who can’t agree with Koch’s characteristically Libertarian isolationist foreign policy, although we have to admit that’s one reason the conspiracy theories sound crazy. The one thing that Koch and Soros have agreed on over the years was their opposition to the Iraq War, and we note that despite their combined billions and alleged world-shaking influence they couldn’t stop that from happening.
Which makes it interesting to read in The Washington Post that Koch and his network of well-heeled and like-minded big bucks donors have “emphasized new investments in anti-poverty initiatives and reentry programs for former convicts.” At their annual meeting in a luxury resort the group “also announced a new education initiative.” Unstated but more important, they once again won’t be giving any money to the Trump campaign, much less the big bucks that Republican nominees used to get. Trump’s populist base will no doubt boast that it goes to show he can’t be bought, even by the most ideologically pure capitalist billionaires, but they’ll likely need both the money and the free market sort of voters it brings in.
Koch and his well-heeled buddies presumably like the tax bill Trump signed and the deregulations he’s ordered by executive action, as do we, for the most part, although they probably share our preference they’d been more carefully done. Trump’s military retreats from former spheres of American probably don’t bother them, either, although we think they should. On several other matters, though, Trump is estranged from both Koch’s libertarianism and our old-fashioned conservatism, which leaves the Republican party is in poor shape.
Trump’s trade wars are an affront to Koch’s free-market sensibilities, and although we’re not taking the same financial hit as our multi-national neighbor we share hit outrage. Koch is far more cool with mass immigrants than Trump seems to be, too, and although we don’t enjoy the same benefits of cheap labor neither do we support Trump’s panicked call for big and beautiful border wall. Over the two years Trump worked with Republican majorities in both chambers of Congress the country racked up trillion dollar deficits, despite a booming economy that Trump frequently bragged about, and now that the Democrats have a majority in the House and growth is slowing that doesn’t look to get better, and we can hardly blame Koch and his well-heeled buddies for not wanting to fund more of that.
On the other hand, Trump and his die-hard defenders can rightly note that only likely alternative is the damned Democrats and George Soros and all the socialist conspiracies he’s funding, and we guess that Koch and most of his well-heeled buddies will agree with us that’s also pretty damned frightening. Even so, we’re pleased to see that our far richer and more influential neighbor has joined us here on the political sidelines, and we’ll be grateful if Koch can do for poor people and convicted felons as well as they’ve done for our local arts and sporting and economic  communities, and we’ll try out best to chip in..

— Bud Norman


From the Tea Party to Anti-Trump

The presidency of Donald Trump is already well underway, and so is a spirited opposition to it. So far, neither seems at all likely to make great America again.
Trump took the oath of office in front a sizable and enthusiastic crowd at the Washington Mall on Friday, but there was no disputing that the turnout for the next day’s protests was much larger. The Trump administration went right ahead and disputed it any way with some widely and justly ridiculed “alternate facts,” but it could have more reasonably argued the numbers of people on the streets waving signs for one side or another another don’t really matter. There’s also no disputing that Trump is the duly elected President and the leader of a party that controls both chambers of Congress and will almost certainly soon have the judiciary as well and occupy state and local offices in numbers not seen since the Coolidge days, even if he did lose the popular vote by nearly three million votes, and all the polls that correctly predicted it but got the Electoral vote just wrong enough now show him unfavorably regarded by a majority of the public, but none of that tells you anything about who’s right and who’s wrong in any of the inevitable upcoming arguments.
The anti-Trump turnout over the weekend, in cities all around the country and all around the world, was indeed formidable by any modern mass protest standards. It was far bigger than the Tea Party protests that started percolating during back when President Barack Obama was in the White House and his party controlled both chambers of Congress and seemed poised to control the judiciary, and those didn’t start happening the very day after the Obama administration began with an electoral majority of support and honeymoon-high approval ratings and the overwhelming support of the media. Although the Tea Party movement’s protests were at first ignored and then ridiculed it managed to re-take the House of Representatives for the Republicans in the ’10 mid-terms, and despite Obama’s re-election with a smaller majority in ’12 it continued to make congressional gains, and by ’14 it had delivered a Republican majorities in both the House and Senate that managed to stave off the Democrats’ control of the judiciary, so there’s no telling what those anti-Trump protestors might accomplish with their obvious head start.
After a short bust of angry public outbursts the Tea Party stopped waving signs and chanting slogans on cold street corners and started recruiting candidates and compiling e-mail lists and making donations doing all the rest of the dreary and dirty chore of bringing out political change, and it remains to be how many of those women who took the streets in pink wool “pussy caps” and the men who showed up with the seductively sympathetic slogans on their signs will do the same. We attended enough of those Tea Party protests to run into several fine friends of ours that we knew to be serious people of a well-considered conservative mindset, so despite the ridicule of the Obama administration and its liberal media allies we were not surprised that it proved so successful. Because we rarely check in on Facebook we weren’t aware of the local well-attended anti-Trump protest until it had already occurred, and they started too early on a too cold Saturday morning anyway, and even in the best of the weather we couldn’t be sure that our anti-Trump sentiments were at all aligned with the rest of the crowd, so we skipped the festivities, but we do know several of the people who were they and we know them to be to serious people whose liberalism has been carefully if incorrectly considered, and we don’t doubt it might also come to something.
What it might come to also remains to be seen, but we’re not hopeful. We had high hopes that the Tea Party was the vanguard of a movement toward limited government and personal and fiscal restraint and a foreign policy in defense of the same underlying value of liberty, and sure enough it did put a stop to Obamacare-sized entitlements and pare the the deficits down to the half-trillion size of the George W. Bush years, but at this point it seems to have had the usual mixed results. In retrospect there were a lot of people at those rallies who were convinced that Obama was born in Kenya and that he was just a continuation of the Bush family’s New World Order regime and that the whole Constitutional system seemed rigged, and when the Republicans didn’t undo the Obamacare that had happened before they got back regained the Congress and Hillary Clinton didn’t go to jail they decided that everyone from both parties and all previous political positions had to be purged, and they wound up electing an advocate of seemingly unlimited government with no sense of fiscal or personal restraint who has a dangerous affinity for Russia’s authoritarian leader. We share the anti-Trump movement’s disdain for his unabashedly sexist and arguably racist and altogether unsavory character, but we can’t go along with the Obama-era liberal craziness that comprises the most of it, we’re quite certain that the sudden shared suspicion of the Russkies is opportunistic and temporal, and we suspect that those serious friends of ours with the well-considered liberalism will also be dismayed by how far it might go.

— Bud Norman

Politics on the Playground

A prominent member of the House of Representatives has offered a budget proposal, and the President of the United States has publicly called it a “stink burger.”
There’s much to be said about the budget proposed by Wisconsin’s Rep. Paul Ryan, as well as the alternative put forth a few weeks back by President Barack Obama, but we’ll happily leave it all unsaid. Neither proposal has any chance of becoming law, so we find it far more interesting and worrisome that our political discourse has devolved to the point of “stink burger.”
Obama was once widely lauded as the greatest orator since Demosthenes, but surely even his most awe-struck admirers will admit that “stink burger” is not quite eloquent enough to justify that reputation. There were kids on the playground at Kistler Elementary School who could come up with more creative insults, and by the time they had graduated to Brooks Junior High and foul language they didn’t sound nearly so juvenile. We have no idea how taunting is done on the playgrounds of Honolulu’s ritzier private schools or at Columbia University and Harvard Law School, but we had hoped for something a little more high-brow. We certainly expect more of a President of the United States, as we can fondly recall a time when even a relatively low-brow Vice President could come up with something as alliterative and snappy as “nattering nabobs of negativism.”
The “stink burger” slur reportedly went over well with Obama’s audience at the University of Michigan. This does not speak well for the state of higher education, where a higher-toned sort of malicious slander once prevailed, but perhaps they were just grateful to be spared all the boring details of the budget debate. Obama also called Ryan’s budget proposal a “meanwich,” which seems to imply that he finds it parsimonious, which is almost an actual argument, and even a modern-day college student can understand why the president preferred to avoid any specifics.
Ryan’s allegedly radical right-wing proposal is rather tepid stuff, after all, at least by the standards of we actual right-wing radicals. The plan would take ten years to reach a balanced budget, must less begin to eat into $17 trillion of debt, and is mean only the sense that your parents were mean when they wouldn’t give you a pony. You’d probably get that long-awaited pony if the Obama budget proposal were passed, but it is based on the equally fanciful notion that a nation can live happily ever after on trillions of dollars of indefinitely continued debt. That’s a hard argument to make, even to a student full of empty-headed college students, and is best expressed in terms of “stink burger.”

— Bud Norman

Embracing the Suck

Once in a rare while a statesman will utter a phrase that pithily and memorably sums up the spirit of his times. Patrick Henry did so with his revolutionary cry of “Give me liberty or give me death,” Abraham Lincoln when he urged America to reconstruct itself “with malice toward none, with charity for all,” Winston Churchill with his talk of “blood, sweat, tears, and toil,” and John F. Kennedy as he vowed to “pay any price, bear any burden” in defense of liberty. For this peculiar moment in history we now have Rep. Nancy Pelosi urging her colleagues in the Democratic party to “embrace the suck.”
We had thought that former Secretary of State Hillary Clinton perfectly encapsulated the zeitgeist when she defended her deadly incompetence and dishonesty in the Benghazi tragedy by snarling “What difference, at this point, does it make?” to a congressional investigative committee, but Pelosi’s bon mot might top even that. It has a certain vulgarity, illiteracy, and slanginess about it that is better suited to our age, and even more succinctly expresses the fatalistic resignation to decline that characterizes contemporary American culture.
The memorable quotation was reportedly uttered at a caucus of congressional Democrats contemplating a proposed budget bill. According to all the press accounts many of those in attendance were dissatisfied with the proposal because it did not include yet another extension of unemployment benefits for people who have been out of work since the Depression of 1819, but we suspect that the Democrats were also disgruntled about the lack of massive tax hikes, massive subsidies for community-organizing scams, massive abortions for everyone, and any number of other massive progressive wish-list items. As the leader of her party in the House of Representatives, Pelosi was sympathetically agreeing that because of the Republicans’ control of the chamber it “sucks” they can no longer run up trillion dollar tabs for such utopian necessities, but urging them to along with the deal because at least it didn’t allow such radical Republican outrages as a balanced budget. What with the manifest failure of Obamaism in general and Obamacare in particular at long last dawning upon a gullible public it “sucks” to be a liberal for the foreseeable future, Pelosi might have added, but the party should embrace the opportunity to blame the Republicans for not allowing them to do more of it.
With all of the media attention being focused on the rather nasty in-fighting between the crazed anarchist Tea Party right-wingers and the lily-livered RINO establishment sell-outs, it warms a Republican heart to know that the Democrats don’t seem to be any happier or more collegial these days. Conservatives of all temperaments are dispirited that their political leadership have acceded to a deal that continues deficit spending on an ever-expanding government that can’t seem to get anything right and is continually getting in the way of people who could otherwise make good things happen, but they can take some consolation in knowing that at least the government’s growth isn’t so ravenous or it’s debts so debilitating that they satisfy Democratic ambitions. With the budget deal now a fait accompli it might even be a good idea for conservatives to set aside the internecine warfare, await the next elections, and in the meantime embrace the suck.

— Bud Norman

The Bright Side of the Scandals

There are so many scandals currently swirling about the White House, each with so many convoluted subplots, that even the most avid enthusiast will find it hard to keep up with the latest twists. As much as we’ve been enjoying the spectacle, especially the hilarious answers being offered up by an administration unaccustomed to hard questions, following all the developments is proving so exhausting that we’re thinking of switching to “Breaking Bad” or some other trendy episodic television series.
The scandals are so numerous, and the damning details so voluminous, that there is some concern among the administration’s critics that their effect will blunted. Some worry that with each scandal vying for news space and attention none of them will get the attention nor provoke the outrage that it individually warrants. Others worry that the stories are so constant the public will soon come to regard such abuses of governmental power as normal, in much the same way that they’ve become accustomed to trillion dollar deficits or Obamacare. Yet another theory, more compelling to us, holds that the stories are distracting attention from more consequential scandals such as trillion dollar deficits and Obamacare. No one on the right seems confident that anyone will ever be held responsible, that any meaningful reforms will be enacted to prevent such outrages in the future, or that the opposition to the administration will even gain a political advantage from all the muck.
Despite being temperamentally inclined toward such pessimism, we are cautiously hopeful that the revelations of all the scandals will ultimately have some beneficial effect on the nation’s politics. Despite a virtual declaration of war upon them by the Justice Department the media still aren’t covering any of the scandals with the same screeching indignation that they brought to the non-scandal of George W. Bush’s 30-year-old Air National Guard records or the celebrification of Valerie Plame, which would be too much to hope for, but a surprising amount of attention is being paid. At this point even the most determinedly uninformed Americans have heard enough snippets of stories to sense that something is awry, and they’re not hearing anything reassuring. Occasional editorial efforts to assure that the public that the scandals are of no importance have the same curiosity-inducing effect of a policeman telling passersby that “here’s nothing to see here,” and the administration’s claims that the needless deaths of four Americans in a far-flung Libyan consulate happened a long time ago, that the president’s chief of staff didn’t want to bother the president with the news that the Internal Revenue Service was harassing his political enemies, and that the Attorney General was righteously offended by the warrants he’d signed to treat investigative journalism was a criminal conspiracy are not likely to satisfy anyone but the most loyal partisans.
What’s more, the general impression to be gleaned from all the noise is that the government is not to be trusted, neither for competence nor honesty. This sobering realization, which has been a bedrock assumption of conservatism since at least the days Edmund Burke, will inform the debate on any number of issues. Although it is possible that the Congress will pass a bring ‘em on immigration reform bill under the cover of the scandals, those paying attention will be more likely to heed the skeptical voices noting that the amnesty proceeds the long-awaited border enforcement and other promises intended to reassure the conservative majority. The shocking abuses of the IRS will strengthen the arguments against Obamcare, which hands unprecedented powers to the rogue agency, and should revive efforts to replace the irreparably corrupt tax system with something flatter and simpler. The brazen attempt to silence dissent in both the IRS and Justice Department scandals will also embolden both the Tea Party and the press, maybe even lessen their bitter rivalry, and it can be expected that even more whistle-blowers will free to come forward with even more revelations.
Perhaps it’s too much to hope for, but we can’t help thinking that maybe those phony “green jobs” programs with their million-dollar-a-job price tags will be looked at with a newfound skepticism, and even the trillion dollar deficits that they’re adding to will be reconsidered. A long, hot summer of scandals slowly trickling into the news will lead nice into the 2014 election season, and if the conservatives don’t take advantage it will be their own fault.

— Bud Norman

Budget Fuss

President Barack Obama at last presented his budget proposal on Wednesday, two months after the legally mandated deadline and late enough for the press to declare it “long-awaited,” and it proves an interesting document. It’s probably irrelevant, as none of Obama’s previous budget proposals have ever gained so much as single vote in Congress and this one looks likely to fare even worse, but it’s interesting nonetheless.
In its totality the budget proposal is typical of all of Obama’s past political efforts, with big tax hikes imposed mainly on the wealthy and some cuts taken from defense while increasing spending elsewhere, with no end to the massive amounts of the red ink in sight, but buried deep within are a few ideas that are pleasantly surprising, such as asking federal employees to contribute more to their pensions and health care as well as a sort of jargon-laden acknowledgement that some sort of entitlement reform is ultimately necessary. None of it comes close enough to fixing the nation’s soon-to-be-calamitous fiscal condition to win any the vote of any real Republican, but it’s more than enough than to infuriate the more noisome elements of Obama’s Democratic base, and sufficient for the president’s more ardent admirers in the press to deem it part of his “charm offense” and a move toward an admirably more pragmatic and less political approach.
Those pressmen are probably over-doing it a bit, as Obama is still insistent on tax hikes and deficit spending that are calculatedly unacceptable to the Republicans, and his tone when announcing the plan was still full of partisan punchiness. After hilariously arguing that his massive tax hikes are “a fiscally responsible blueprint for middle-class jobs and growth,” Obama went on to blame his opposition for the supposed catastrophes of the “sequester” budgets cuts that were originally suggested by his staff. He even kept a straight face as he claimed that the currently robust recovery will continue “as long as Washington doesn’t get in the way.” Any real Republican believes that Obama’s tax hikes and deficit spending on ever-expanding regulations are precisely what’s getting in the way of a recovery more robust than the current 0.4 percent growth rate, of course, but Obama clearly remains uninterested in such crazy talk.
Such rhetorical red meat won’t satisfy the true believers in Obama’s party, however, given the heresies he has laid out in the budget proposal. Asking government workers to pay toward their pensions and health care at something approaching the rate of a private sector employee made Wisconsin Gov. Scott Walker and New Jersey Gov. Chris Christie the left’s most vilified figures in public life, and any attempt to prevent the imminent demise of any entitlement program is somehow regarded as a blasphemy against Franklin Roosevelt. Even such “baby steps,” as the venerable right-wing National Review approvingly dubs it, are enough to create a rift within his party and opening for the Republicans.
Obama has merely proposed an accounting change in the way Social Security benefits are dispersed, dryly dubbed “chained CPI,” but as the ads are already saying on local talk radio that translates to Social Security which will inevitably prove unpopular not only with staunch leftists but also with many older and more-prone-to-vote Americans. Opportunistic Republicans can run on their outraged opposition to throwing the old folks out on the street in the next election cycle, neatly flipping a traditional Democratic theme, while more principled Republicans can run on Rep. Paul Ryan’s House-approved plan that maintains the status quo for the over-55 crowd while offering the next generations more free-market options as an appealing replacement to the entitlement systems, and in either case they could do well.
If Obama is being the shrewd politician that the press portrays, it is hard to see how his plan will benefit his party. Perhaps he’s reacting responsibly to the economic and fiscal realities that he confronts, in his own half-hearted and characteristically partisan and ideological way, but c’mon.

— Bud Norman

Fiscal Health, Mental Health

At least one side of the great federal budget debate has clearly gone stark raving mad. It might be us, a possibility one should always acknowledge, but we’re pretty sure it’s the Democrats.
Back in the dark days of the Bush administration the Democrats would become downright apoplectic about the half-trillion dollar deficits that the Republicans were racking up, with Senator and presidential candidate Barack Obama going so far as to call it “irresponsible” and “unpatriotic,” but ever since they’ve been noticeably more insouciant about the trillion-dollar-plus deficits that have annually accrued. Lip service would still paid to notions of fiscal responsibility, always accompanied by a principled insistence on a “balanced” approach of mythical spending cuts and actual tax hikes, but without the same sense of urgency. There was reason to suspect that the Democrats believed the national debt wasn’t much of a problem at all, and wouldn’t be at almost any amount, but because they had simply dispensed with the budget process altogether it was never necessary for them to come right out and say so.
Democrats in the Senate have lately felt compelled to offer a detailed budget proposal for the first time in four years, however, and the document is jarringly candid even if the claims being made for it by the authors are not. The Democrats’ plan would never a balance any budget for the next 10 years, increase spending by 62 percent over that time, and add another $7 trillion to the national debt even as it raises taxes by $1.5 trillion. Those eye-popping numbers are almost certainly over-optimistic, too, as they are based on an assumption the nation’s gross domestic product will expand from 3.8 percent to 6.6 percent every year for a decade. Such robust growth exceeds the average performance of the American economy, and seems especially unlikely when another 62 percent of regulatory bureaucracy is added to the private sector and another $1.5 trillion is sucked out. Some Democratic Senators have been touting the budget’s spending cuts, which are mostly of the phony-baloney Washington accounting variety, but their own documents show they are fare outpaced by the added spending.
The president hasn’t yet submitted his budget proposal, being far too busy with international crises and golf to have met the legally-mandated February deadline, but that is of little matter considering that none of his previous budget proposals have yet to win a single vote in either chamber of Congress. Those past Obama budgets all included seas of red ink, and an interview with the ABC newsman George Stephanopolous the president signaled that the next one would do the same. Obama that “My goal is not to chase a balanced budget just for the sake of balance. My goal is how do we grow the economy, put people back to work, and if we do that we are going to be bringing in more revenue,” and the reliably friendly former Clinton staffer did not challenge the point. He might have noted that financial solvency is not something that is desired merely for its own sake, or asked how higher taxes and further government intrusion into the private sector is going to grow the economy and put people back to work, or why anyone should believe that the government wouldn’t spend beyond any additional revenue even if it did occur, but such questions never seem to occur to Democrats.
Obama warned that “We’re not gonna balance the budget in ten years” because the Republican plan to do so proposed Rep. Paul Ryan includes such horrors as medical vouchers for seniors and a tax hike on the middle class. The vouchers are only horrible because they offer citizens a choice, and the middle class tax hikes aren’t in the Ryan plan at all, but Obama nonetheless echoes the constant Democratic chorus that the Republican’s budget is a demented documented favored only by the most extreme right-wing radicals. To hear the Democrats and their media allies tell it, the Ryan would unleash such horrors on the poor and downtrodden that not even Charles Dickens could do them justice. Others are aghast that Ryan would even be so rude as to propose anything, given that he was on a losing presidential ticket and that the country clearly chose another decade or so massive borrowing.
Extreme right-wing radicals such as ourselves find Ryan’s budget a rather modest proposal, however, and are grousing for far sterner stuff. The plan includes such attractive features as a repeal of the budget-busting, job-killing bureaucratic nightmare that is Obamacare, but it also continues the recent Obama tax hike on the rich, takes ten years to reach a balance budget without making a debt in the existing debt, and despite its supposedly draconian cuts allows for 3 percent annual growth in federal spending. A more thorough downsizing of the federal behemoth would be much preferred, but at least the Ryan plan acknowledges the reality that the government needs remain financially solvent for than “it’s own sake.”
On the other hand, maybe a government can just borrow another trillion dollars every nine months for ever and ever. Perhaps governmental micro-management will produce an economic boom for the first time in history, and the Democratic politicians elected by a grateful public won’t spend all the money that comes in and then borrow even more. Maybe we should rack up some debt of our own, and not worry about avoiding bankruptcy merely for its own sake. It’s possible that we’re being crazy to try and stay in the black, but we doubt it.

— Bud Norman

In Quite a State

The state of the union, according to the president’s latest annual oration on the topic, is stronger. Presidents always say this sort thing in State of the Union addresses, regardless of the circumstances, so perhaps President Barack Obama can be forgiven for merely following form.
There isabundant evidence that the state of the union is not nearly so strong as it was when Obama gave his first address, however, and his arguments to the contrary were not convincing. He touted an end to a “decade of war” despite the growing dangers of the world, and boasted of a Fed-inflated stock market bubble. He argued that his massive new bureaucracies mean “consumers, patients, and homeowners enjoy stronger protections than ever,” presumably from those nasty corporations, but seemed unconcerned about what will protect them from the bureaucrats. He further claimed that “we have cleared away the rubble of crisis,” but left unmentioned that we have also piled up an additional $6 trillion or so of debt in the process.
Nothing else in the speech offered much hope that thing the country will soon be strengthened in any noticeable way. Obama threw in some boilerplate language about encouraging free enterprise and rewarding individual initiative, but he seemed to rush through it on his way to calls for higher taxes, more government spending in areas of the economy that have traditionally been left to private enterprise, and an unmistakably collectivist ethic. All of this was couched in the language of “revenues,” “investments,” and “helping folks,” of course, but the point was still clear. He also argued that the government should become “smarter,” a worthy goal, but still seemed smitten with the alternative energy “investments” that have thus far been an expensive diversion from the potential traditional energy boom. Obama’s opponent in the past election was provably smart about investing, though, and Obama managed to convince a majority of voters of that the poor overly-rich fellow should be reviled for it.
The speech also stressed the need to “forge reasonable compromise” to make “some basic decisions about our budget” to avoid the so-called “sequestration” cuts, lamenting the government’s tendency to “drift from one manufactured crisis to the next” without mentioning that the sequestration cuts were his idea. Nor did he mention that the government hasn’t had a budget at all during his time office due to his party’s control of the Senate. He was slightly bi-partisan in noting that “both parties have worked together to reduce the deficit by more than $2.5 trillion, meaning that they agreed to not go yet another $2.5 trillion in debt, but it was still understood as a warning to the Republicans they should cave early in the upcoming budget negotiations.
More talk of reasonable compromises followed, with Obama generously agreeing to “modest reforms” of the entitlement system so long as they are accompanied by yet another round of “revenue increases.” The multi-trillion dollar shortfalls in the entitlement programs require only slight tweaking, apparently, and so long as those darned rich people pay more Obama seems willing to go along.
Obama added some talk of illegal immigrants and guns, threw in a subtle allusion to homosexuality, and finished with the usual tear-jerking shtick about the little people out there. We were to stunned to follow it after the part about Obamacare driving down health care costs, though, and we assume it was much the same as in past speeches. This was the fifth Obama State of the Union address and there only three to go, unless he decides that those pesky term limits are of more consequences than the rest of the Constitution, so we do feel slightly strengthened by that.

— Bud Norman

That Confounding Obamanomics

Perhaps it’s because Barack Obama’s genius is so far beyond the comprehension of mere mortals, but even after four years of pondering we’re still having the hardest time understanding his economic theories,
We’ve never quite grasped, for instance, the part about how the economy crashed in 2008 and has never fully recovered because the income tax rates for the top 2 percent of earners were set a few points too low way back in the dark days of the Bush administration. So far as we can tell the president has never attempted to explain this counter-intuitive contention, and instead seems content with the knowing nods that it always gets from his avid admirers, but we’d love to hear him walk us through it some day. We thought the recession had something to with the government’s insistence that the banks make hundreds of billions of dollars in home mortgage loans to people who were never going to be able to pay the money back, but the president has never made any mention of that so there must not be anything to it.

Some people have explained on the president’s behalf that the too-low tax rates for the hated rich caused the deficit to rise, which somehow caused all those people to default on their mortgages, and they seem to truly believe this. When we note that federal revenues actually increased in the years after the tax rates were lowered, and continued to rise until all those bad loans brought the banks down, they always respond with an exasperated sigh that sounds quite convincing. We also note that the deficits have doubled since Obama took office, but apparently this is also Bush’s fault, and we’re assured that deficits are necessary to stimulate the economy.

It makes some tenuous sense, we suppose, that if the too-low tax rates caused the recession then upping them a few points would restore the nation’s economic health, but that leaves us wondering why the president is also insisting on another round of multi-billion dollar stimulus spending. According to one story the spending is needed to offset the economic drag of a tax hike, but if so it would seem much simpler to just skip the tax hike. Adding to the confusion, the proposed spending would add to the deficit that is said to have caused the economy to tank and remain tanked, but maybe it will only add to the good kind of bigger deficit that stimulates the economy.

All those trillions of dollars of deficit spending over the past four years don’t seem to have done much stimulating, not at first glance at the statistics measuring economic growth and job creation, yet the president’s many fans insist that without it everyone in the country would now be rubbing sticks together in caves and shooting each other over the last bushel of grain. There’s no way of proving this, economics being such a dismal science, but neither is there any way of disproving it so we’ll just do the fashionable thing and take the president’s word for it.
We’re also assured that no matter how many trillions of dollars of debt accrue there will none of the negative consequences that have followed in Greece, Spain, Argentina, or any of the other countries that have taken such a profligate path. Why this is so we’re not sure. Something to do with American exceptionalism, probably, although the president only believes in that to the same extent that the Greeks believe in Greek exceptionalism.
Oh well, there’s another four years to figure it all out. We’re sure that happy days will be here again by then, and the genius of it all will be clear.

— Bud Norman

Easing Into Darkness

The Arab spring has turned to a brutal fall, the president can’t quite decide if the Egyptian government that he helped bring into power is a friend or foe, and there seems to be a similar question in the president’s mind about Israel as it readies for a war with Iran. The folks down at the stock market are happy, though, because the economy’s so lousy that the Federal Reserve has decided to hand it a whole lot of newly-printed money.

Citing all the familiar economic doom and gloom, a statement from the Fed on Thursday announced that it will buy $40 billion of mortgage-backed securities every month for an indefinite period of time as part of a third round of “quantitative easing” that will wind up increasing the money supply by more than $3 trillion. Given that the Fed also signaled its intention to keep interest rates at their current historical lows for the foreseeable future, making bonds and other fixed-income investments a mug’s game, much of that money will quickly make its way to Wall Street.

This made for a big rally on the big boards, naturally enough, but it’s hard to see how it will do much for a real economic recovery on less fashionable roads. The first two rounds of quantitative easing clearly didn’t work, or there wouldn’t be any need for a third one, and there is no convincing theory to explain why this effort will be any more successful. There’s an old adage that the third time’s a charm, but we can find no scientific basis for this notion, and our thrice-married friends assure us that it’s bunk.

What’s troubling the economy is not a lack of pieces of paper printed with green pictures of federal buildings and former officials, as these are already in greater abundance than ever, but rather a lack of incentives for people to start moving them around. Until the tax codes, regulations, and prevailing political climate all signal that Americans can expect to keep most of what they earn, the Fed can roll out the dollars at a Weimar-era rate and the smart money will still be seeking a safe haven far offshore.

The Fed’s actions entail considerable risks, too. One of the reasons that people are sitting on their money is a reasonable expectation that the government’s about to go broke, and although Fed Chairman Ben Bernanke said in a Thursday news conference that his plan won’t affect the budget it is unlikely that it will induce any non-Tea Party politicians to cut back on their spending. Should the plan actually stimulate the economy, whatever goods and services are created will be chasing so much money that a ‘70s-style inflation rate might prove a best-case scenario. More dollars mean a weaker dollar, as well, and could even threaten the reserve currency status.

None of the negative effects will be immediately apparent, however, unless you’re a retiree who was suckered into bonds and other traditional retiree-age investments, and by the time the worst of it hits the election will be long past. Any short-term benefits that might occur will be more immediate, on the other hand, but surely it would be paranoid to think that politics had anything to do with it.

— Bud Norman