Archive for the ‘Economics’ Category

Salon Writer Complains That Democrats Are Corporate Whores

Tuesday, July 29th, 2014

Well well well, what have we here?

It’s a jeremiad by Democrat Bill Curry about how his party has abandoned its soul for the sweet smell of Wall Street crony capitalist dollars.

Democrats hooked on corporate cash and consultants with long lists of corporate clients were less attuned to Nader’s issues.

Democrats today defend the triage liberalism of social service spending but limit their populism to hollow phrase mongering (fighting for working families, Main Street not Wall Street). The rank and file seem oblivious to the party’s long Wall Street tryst. Obama’s economic appointees are the most conservative of any Democratic president since Grover Cleveland but few Democrats seem to notice, or if they notice, to care.

These days, says Curry, Democrats “don’t believe in ideas because they don’t believe in people” and calls for a Nader-esque populism. (Indeed, Nader’s latest book seems to provide the spine for his piece.)

Curry actually sees the populist Tea Party energy on the right and laments its absence on his side of the aisle. “If there’s a true populist revolt on the left it is as yet invisible to the naked eye.” (Though I note one very hot populist issue, widespread opposition to the Democratic Party’s push for illegal alien amnesty, is conspicuous by its absence from his piece.)

“Democratic elites are always up for compromise, but on the wrong issues. Rather than back GOP culture wars, as some do, or foreign wars, as many do, or big business, as nearly all do, they should back libertarians on privacy, small business on credit and middle-class families on taxes.”

This advice is far from the worst Democrats have received, but they are congenitally unable to follow it for numerous reasons:

  • As a party, Democrats are all in on Big Government. Access to the Gravy Train and charging a transaction fee on robbing Peter to pay Paul are the only thing that holds their coalition together. Likewise, to say Democrats are unenthusiastic about cutting taxes is to vastly understate the case.
  • Democrats can’t embrace populism because both the political and cultural soul of the party is rooted in elitism. The people who run the party in D.C. are absolutely certain that they and their brethren can run peoples’ lives better than they can run their own. And the party’s biggest supporters in blue bastions like New York City, Chicago, Boston, Los Angeles and San Francisco are convinced that they are manifestly smarter, more moral, and above all more sophisticated than those gun-toting redneck freaks of JesusLand. Asking them to embrace real populism (as opposed to candidates making meaningless promises every 2 or 4 years) is almost certainly futile.
  • A significant fraction of their supporters in those blue bastions benefit directly from the crony capitalism Currey decries.
  • There are also numerous areas where Curry appears unable to shed his blue-colored glasses:

  • When he says “Oddly, the one system working relatively well, public education, is the object of our only sustained reform effort,” he’s ignoring the huge problems in teacher union controlled schools and curricula as documented everywhere from Waiting for Superman to Vergara vs. California. And in his conclusion, the very first member of his potential future coalition mentioned is “unions,” pointedly ignoring the populist revolt against fat cat public sector unions that have helped bankrupt Detroit and numerous California cities.
  • The plight of American workers pushed out of jobs by illegal aliens, and the popular revolt against busing them to communities across the country and amnesty? No mention.
  • He seems equally enthused about small business and fighting “global warming,” with nary a mention about how the EPA’s power grab thanks to the latter is crushing small business left and right, nor how many “green” firms are riding the crony capitalist gravy train.
  • Other populist “small ball” issues that never get mentioned: cheap light bulbs that work and toilets that flush. Though Shalt Not Question Washington’s Mandates.
  • Agribusiness subsidies, crony capitalism in almost its purest form? Not mentioned.
  • The Democratic Party faithful are never, ever, ever going to reengage with Nader, because their hatred for George W. Bush is far stronger and more visceral than their theoretical attachment to populist economic policies.
  • Of course, since it’s Salon, the piece has more than one inside-the-blue-bubble howler:

  • “Nader’s belief in convergence isn’t the same as Obama’s naïve pursuit of the holy grail of bipartisanship.” Obama has pursued “bipartisanship” with much the same fervor the late Amy Winehouse pursued “sobriety.”
  • “Republicans can talk values even while defending a corrupt status quo because, recent Tea Party convulsions aside, defending the status quo is their job. The Democrats’ job is to challenge the status quo; when they don’t do it, nothing they say sounds sincere. ” Republicans certainly defend many cultural status quos, but it is the Democratic Party that has consistently defended the status quo of the lumbering monstrosity that is Big Government.
  • When he says that until 1996, congress “had not enacted any major social or economic reforms since the historic environmental laws of the early ’70s,” he’s flat out lying. (Kemp-Roth was certainly reform.) What he actual means is “No reforms that far left economic populists like myself approve of.”
  • In the next paragraph he decries the deregulation of the airline, trucking and phone industries, missing the point that these were not only reforms, but populist reforms that ended monopoly profits by entrenched special interests, and ones which radically brought down prices for consumers.
  • “But Nader always hit hard; you don’t get to be the world’s most famous shopper by making allowances or pulling punches.” I would venture to guess that the world’s most famous “shopper” is probably someone like Paris Hilton, which is probably not the image he wanted to convey…
  • “Liberals have spent the intervening years debating macroeconomic theory.” Have they? As far as I can tell, the only debate in the ideological vineyards of the Democratic Party is over how much Keynesian vs. how much Marxism.
  • “Democrats must also learn to argue history. They chortle when Michele Bachmann credits the founders with ending slavery or Sarah Palin forgets who Paul Revere rode to warn.” Tiny little problem: By and large Sarah Palin got Paul Revere’s story right, no matter how much liberals might insist otherwise.
  • “The best template of populism remains the career of William Jennings Bryan.” Well, it’s not that Curry is necessarily wrong per se, but one must view with a certain jaundiced eye the idea that current electoral models can be found in a man who probably peaked in 1896.
  • Indeed, when you get right down to it, Curry’s piece could be boiled down to “Talk vaguely about populism while pushing the same Big Government, redistributionist schemes liberals always push.” Maybe the Nader book itself is bolder (and if someone wants to pay me to review it, I’d happily give it a go), but Curry’s piece is very old and undistinguished wine decanted into a slightly shinier bottle.

    No matter how many times liberals declare “This is it! I’m finally fed up with the Democratic Party!”, the party’s fat cats know the truth. Come November 8, 2016, they’ll remember they loathe Republicans far more than they love reform, and pull the (D) lever no matter how many jeremiads Bill Curry and his ilk pen.

    We’ve seen this movie before, and we know exactly how it ends.

    LinkSwarm for July 25, 2014

    Friday, July 25th, 2014

    Time for another random roundup of news and links:

  • Jimmy Carter looks like frickin’ Bismark next to the feckless dorm-room intellectual currently haunting the golf courses of the greater DC area.”
  • Even Thomas “What’s The Matter With Kansas” Frank calls Obama “ineffective and gutless.” (Warning: Salon Liberal Whining Ahead.)
  • Liberal law professor Lawrence Tribe thinks that ObamaCare is probably doomed due to the Halbig decision. “I cannot see how this Court could do anything other than decide the same way as the DC Circuit did. The statue is clear on its face.”
  • Even “ObamaCare Architect” MIT economics professor Jonathan Gruber said the same thing back in 2012: “What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits.”
  • Mark Steyn on the Halbig ruling:

    As to Mr Earnest’s point on “what Congress intended”, who can say? No Congressman who voted for the bill read it. Presumably, some legislator’s staffer wrote that actual line about “established by the State”. If we could locate him among the vast entourages of the Emirs of Incumbistan, we could ask him what his “intention” was. Until then, calibrating the competing degrees of deference to a corrupt bureaucracy, a contemptuous executive, a politicized judiciary and a feckless hack legislature brings to mind Samuel Johnson’s line about arguing the precedence of a louse and a flea, with a tick and a cockroach thrown in.

  • Missing from my Gaza roundup: “Shalom, motherf****r.” “I will not apologize for surviving.” (Hat tip: Josh Perry.)
  • Bill Whittle makes the case for Israel:

  • Obama won’t help arm Ukraine because he had a key role in disarming them.
  • Democrats plans for November: All race card, all the time.
  • 50 years of Democratic rule and now Detroit is cutting off people’s water. “Just goes to show that nothing is so expensive as when it is ‘free.’”
  • “That’s not funny.”
  • Republicans should stand firm and let the Export/Import Bank corporate welfare boondoggle expire. (Hat tip: Instapundit.)
  • Che Guevara, racist:

  • Maureen Dowd is never so readable as when she’s slamming the Clintons.
  • “Canadian Candidate Drops Out After Masturbation Video Surfaces.”

  • Sarah Palin endorses Joe Carr against Lamar Alexander in Tennessee senate primary. I don’t think anyone who watched Alexander’s “Lamar!” flannel flameout in the 1996 Presidential race has ever really trusted him since…
  • A New York City cupcake truck seems a little unclear on who their clientele might be. (They’ve since deleted both this tweet and the one where they implored people not to “snitch” to cops when they see crimes committed…)
  • Evidently nobody is actually reading Thomas Piketty’s book.
  • In praise of Power Girl’s boob window.
  • How Bad Has ObamaCare Been for the Economy?

    Wednesday, June 25th, 2014

    This bad (click to embiggen):

    Gross domestic product, the broadest measure of goods and services produced across the economy, contracted at a seasonally adjusted annual rate of 2.9% in the first three months of the year, according to the Commerce Department’s third reading released Wednesday. That was the fastest rate of decline since the first quarter of 2009, when output fell 5.9%.

    Just about every sector was down:

    My takeaway is that ObamaCare has been twice as bad for the economy as the subprime meltdown.

    The Clintons Just Don’t Get It

    Tuesday, June 24th, 2014

    Hot on the heels of Hillary Clinton claiming that her family was dead broke in 2001 (for certain values of “dead broke” that include being worth more than $20 million) comes news that Hillary has doubled down on the “shucks, we’re just regular folks” gambit.

    In an interview with The Guardian, Clinton said she isn’t “truly well off”:

    But with her huge personal wealth, how could Clinton possibly hope to be credible on this issue when people see her as part of the problem, not its solution?

    “But they don’t see me as part of the problem,” she protests, “because we pay ordinary income tax, unlike a lot of people who are truly well off, not to name names; and we’ve done it through dint of hard work,” she says, letting off another burst of laughter. If past form is any guide, she must be finding my question painful.

    The full quote is actually more damning than just the “not truly well off” bit because it suggests an even more radical disconnect from the economic reality most Americans face every day. Evidently Hillary is suggesting she gets a pass from class warfare envy because: A.) She and Bill have actually deigned to obey the law by paying taxes, and B.) Americans know just how hard it is for Bill to give $103 million worth of speeches.

    A few choice reactions:

    Moreover, Hillary’s daughter seems to have picked up on her mother’s entitlement issues. It seems that the woman married to a former Goldman Sachs manager who started his own hedge fund, the woman who owns a $10 million Manhattan apartment, the woman who was given a $3 million wedding and the woman who MSNBC paid $600,000 a year to (or $26,724 for every minute she appeared on-air) says she doesn’t care about money.

    At least one pundit has suggested that Hillary’s clan suffers from “Status-Income Disequilibrium”, in which people with All The Right Opinions suddenly realize how much wealthier fellow members of the Overclass are. Or, as Rush Limbaugh puts it, “in [Hillary]‘s world, $50 million is peanuts.”

    Let’s give Bill Clinton one small piece of praise in all this: As far as I can tell, on this particular subject he’s apparently been smart enough to keep his mouth shut…

    Texas vs. California Roundup for June 3, 2014

    Tuesday, June 3rd, 2014

    Lots of news on the Texas vs. California front. An audit turns up $31 billion in California budget mistakes, Democrats hike the minimum wage there, Jerry Brown tries to do something about the growing CalSTARS pension deficit, and people and businesses continue to depart the “Golden State” for Texas…

  • You know how Democrats were crowing that California had a budget surplus? Forget about it:

    The California Bureau of State Audits set off a scandal on June 1st by disclosing that the State Controller’s Office made accounting misstatements amounting to $31.65 billion. The timing of the announcement may be devastating to the Democrats who expected to use their super-majority to pass billions of dollars in increased spending, but may now find the net effects of the accounting restatements are a $7 billion General Fund deficit.

    Snip.

    As the former Treasurer of Orange County, California it is my preliminary judgment that under state law the negative $7.847 billion impact from overstating general fund assets and revenues and overstating deferred tax revenues may create an “on-budget” deficit to the state’s $96.3 billion “General Fund Budget.”

  • From the same audit: “There was a deferred tax-revenue figure posted as $6.2 billion when it was actually $6.2 million.”
  • California Senate votes to hike minimum wage to $13 an hour. It’s like they want to export ALL their jobs to Texas.
  • Wealth continues to move from high tax states to low tax states. “The nine states without a personal income tax gained $146 billion in new wealth while the nine states with the highest income tax rates lost $107 billion.”

    Union-dominated states are sinking further into economic stagnation as Democratic politicians increasingly dominate the local political climate. In 2012, California Democrats won a supermajority in both houses of the legislature and proceeded to accelerate a tax and spending spree that has been ongoing for two decades. For example, California now has the nation’s top state income-tax rate, at 13.3 percent.

    Those kind of policies have consequences. The Manhattan Institute released a report in 2012 that found that since 1990, California had lost nearly 3.4 million residents to other states with lower tax rates.

    Snip.

    The U.S. is swiftly becoming a tale of two nations. States that are following the Reagan model of low taxes and incentives are booming while states that are opting for the Obama model of wealth redistribution and European welfare-state economics are stagnating.

  • Texas’ unemployment rate “has now been equal to or below the national average since January 2007 and below California’s rate—4th highest in the nation—for 93 consecutive months.”
  • A look at how many more billions per year California taxpayers will be coughing up for the inevitable CalSTARS bailout.
  • Alameda Unified’s pension costs could nearly triple and those of its teachers could rise by 25 percent under Governor Jerry Brown’s proposal to reform the California State Teachers Retirement System.”
  • But even though its a step in the right direction, Brown’s proposals stretch out installments so far that they’re still not fiscally responsible. “Even with the higher rates, the debt would continue to grow until 2026. That’s because the amortization over 32 years means the payments would essentially not even cover the interest costs for the first 12.”
  • And the assumptions behind the repayment schedule sound like fantasy: “The state still faces a huge unfunded liability in the teachers’ pension fund—the governor’s proposal would increase employee’s contributions by 3 percent and increase school district’s by nearly 2 ½ times and it would still take 30 years to close the gap with a generously estimated 7.5 percent annual return.”
  • Judge rules CalPERS can be sued for mishandling a long-term insurance program.
  • Thanks to various legal rulings, there will be more felons on California streets. “Release on parole continues a steady climb in California. In just the past five years, over twice as many convicts serving life sentences have been paroled than in the last two decades combined.”
  • Cargo aviation firm Ameriflight is relocating from Burbank to Dallas/Ft. Worth.
  • Sony Pictures Imageworks visual effects house is relocating to Canada.
  • Tesla narrows down list of possible factory locations to Arizona, Nevada, New Mexico and Texas. Not on the list: His home state of California. “The winning state will need to have all the necessary permits approved by the time Tesla plans to break ground next month. With the onerous requirements of the California Environmental Protection Act (CEQA) and other environmental regulations, Tesla would be lucky to break ground by 2017 – when its battery factory is scheduled to open.”
  • New effort to bring California’s underfunded health liabilities onto the books. “Legislation in the early 1990s created an investment fund for California state worker retiree health care, but lawmakers never put money in the fund.”
  • Remember the FBI agent who shot and killed a suspect connected with the Boston marathon bombing? Turns out he receives $50,000 a year in disability pay from the Oakland Police Department. And he’s been getting that since 2004, when he retired at age 31. “59% of Oakland Police Department retirees have received disability retirements.” (Hat tip: Pension Tsunami.)
  • Why people are moving to Texas:

    As a growing number of Americans choose to call Texas home, it is critical that policymakers not lose sight of the reasons why: low taxes, limited government, and personal responsibility. Liberty is popular. That’s a message that needs reinforcement, particularly at the local level where some of the macro level trends involving taxes, spending, and debt are moving in the wrong direction. We can keep Texas and our cities beacons of prosperity and flourishing — but to do that, we must understand the principles that got us here, and defend them in policy and the public square.

  • Some California cities have hidden taxes just to fund government worker pensions. (Hat tip: Pension Tsunami.)
  • Lawsuit over California teacher’s union seniority rules to go to trial.
  • Jerry Brown may let California commit more Kelo-like eminent domain abuses.
  • Sriracha followup: The Irwindale City Council voted Wednesday night to drop its declaration that the hot sauce plant was a public nuisance.
  • Just so I’m not accused of glossing over the occasional bit of bad Texas economic news, Motorola Mobility (which is owned by Google) is closing their Texas smartphone assembly plant. But I think this says more about Motorola Mobility’s viability in a smart phone market dominated by Apple and Samsung than about Texas’ economy…
  • Texas vs. California Update for April 15, 2014

    Tuesday, April 15th, 2014

    Today sucks if you still have to finish your taxes. It sucks more in California than Texas, since you have to pay state income taxes as well. That includes a marginal tax rate of 9.3% for all those millionaires making more than $49,774 a year. As opposed to Texas’ marginal rate of 0.0% for all…

  • Rich Californians don’t seem to mind that their green fantasies are screwing the poor.
  • California Democrats are trying to write racial quotas into the state Constitution. Oddly enough, Asian Americans are actually objecting to their children getting screwed out of college admissions. (Hat tip: Instapundit.)
  • “A combination of unfriendly tax policies, military budget cuts and cutthroat competition is wreaking havoc on California’s storied aerospace industry, a new study cautions.” ​​More here, which notes that:

    Texas and Washington offer low corporate income tax and no personal income tax, while providing a stable business climate and skilled work force. Many high-profile corporations have relocated their operations to new states. Recent examples include Northrop Grumman, which moved its headquarters to Northern Virginia; Raytheon Space and Airborne Systems, which moved its headquarters to McKinney, Texas; and Boeing, which moved two aircraft modernization programs, for the C-130 Hercules military transport aircraft and the B-1 bomber, from Long Beach to Oklahoma City.

  • CalPERS latest report proves conclusively that the fund spontaneously generates unicorns, rainbows and jobs. The Wall Street Journal examines the claims, wipes the vaguely yellow liquid off their legs and concludes “This political report offers one more reason why taxpayers and public workers shouldn’t trust Calpers with their money and would be better served by defined-contribution retirement plans that employees own and control.”
  • The California State Teachers’ Retirement System announced it faces $73.7 billion in long-term liabilities. “CalSTRS has a $71 billion unfunded pension liability.”
  • Both CalPERS and CalSTARS are desperately in need of reform.

    The state teacher pension fund, CalSTRS, needs an extra $4.5 billion each year for 30 years to pay off its unfunded liabilities. CalPERS’ local government members will see costs increase by 50 percent during the next six years. And the state needs to contribute $1 billion more per year for retiree health care benefits.

    These obligations for benefits already earned must be paid, and over the next decade, they will continue to drain funding from essential services such as education, public safety, transportation and health care.

    Yet, powerful interests remain all too eager to kick the can down the road and push our pension problems onto future generations.

  • Why California has an affordable housing crisis.
  • Is there a way out of Taxifornia? As such a solution would require liberals to stop acting like liberals, the answer is: probably not.
  • Bell’s corrupt officials agree to plea bargain deal. Bonus: Robert “Ratso” Rizzo gets 33 months on federal tax evasion charges. (Hat tip: Dwight, who has been all over the Bell story.)
  • At least 60 companies have relocated from California to Texas. But Elk Grove, California is striking back, trying to lure Texas companies to California. “The slogan: ‘Don’t wait for high taxes and stifling regulation to come to you, end the suspense and move to California’ just doesn’t seem too appealing to me.”
  • Continuing troubles with California’s high speed rail boondoggle.
  • Sports equipment maker MonkeySports is relocating from Corona, California to Allen, Texas, adding up to some 225 Texas jobs over two years.
  • A closer look at relocations to the Austin area.
  • Venezuela: A Ray of Light Amidst the Encroaching Darkness?

    Wednesday, April 9th, 2014

    When last we checked, Venezuela had come down with a case of Terminal Socialism. Here’s an update.

    Faced with crippling inflation and a shortage of basic goods due to endemic cronyism, horrible mismanagement and laughable official exchange rates, Nicolas Maduro’s socialist government has finally thrown in the towel and instituted floating exchange rates… sort of:

    A dollar will cost you 6.3 bolívares if you are the government, or if you can persuade Cencoex (the government’s foreign-trade body) that you intend to import vital goods such as food or medicine. Then there’s the Sicad I rate, currently just over 10 bolívares to the dollar, but contingent on irregular, “auctions” (which are nothing of the sort). The new Sicad II process, which is as close to a free market as the government will allow, opened at a whopping 50 bolívares to the dollar. But even that is a bargain compared with the unofficial exchange rate, which at the time of writing stands at almost 68 bolívares.

    Meanwhile, shortages of basic goods mean Venezuelans get to enjoy that classic staple of late stage socialism: waiting in line to get food:

    And the violent crackdown against opposition protesters continues:

    Naturally, as a prelude to cracking down on the opposition, they followed the old socialist playbook by outlawing private ownership of guns. It’s always so much easier to oppress people once they’ve been disarmed. Even so, as the following video (via Legal Insurrection) shows, police don’t always get the upper hand:

    Security forces have also committed dozens of documented instances of torture.

    Are there any rays of home in the grim situation? Yes, Maduro’s government and opposition leaders have agreed to talks. Whether these can actually accomplish anything remains to be seen, but the fact that Maduro “ruled out any changes to the course of what he calls the Bolivarian revolution, the distinct brand of socialism created by his predecessor in office, Hugo Chavez,” tends to indicate that the prognosis is still grim.

    Other Venezuela news:

  • An interview with the jailed opposition leader.
  • Two relative of opposition figures murdered.
  • Globovision assignment editor Nairobi Pinto kidnapped.
  • Spain halts shipments of riot gear.
  • Red States Produce Jobs, Blue States Produce the Homeless

    Friday, March 28th, 2014

    Will Franklin has a detailed piece up correlating homelessness with Democratic Party rule.

    “It turns out that when it comes to mitigating homelessness, the blue state model is just as deeply flawed as the failed blue state model for job creation and economic growth.”

    Substance abuse, broken families, or mental illness– tragedies all– often drive people to homelessness, but long-term unemployment and a general lack of economic vitality play a critical role in pushing people out of their homes (and keeping them out). Indeed, when it comes to reducing homelessness caused by economic hardship, we can chalk up another win for Texas and the red state model.

    Snip.

    California, with just under 12% of the nation’s population, has 22.43% of the nation’s homeless population, giving it a homelessness quotient of 0.88. Quite high, in other words. Almost double the number of homeless people one would predict, given its population.

    Texas, which has roughly 8.2% of the nation’s population, only has 4.85% of the nation’s homeless population (meaning: Texas has a quite low homelessness quotient of -0.41).

    Read the whole thing.

    Venezuela Slides Toward Civil War

    Tuesday, February 18th, 2014

    I knew things in Venezuela were bad, thanks to the magic power of socialism, but now they’re poised to get a whole lot worse.

    “Over the past week, Venezuelan protesters have been fighting against corruption in the government, high inflation, and a high murder rate.”

    The unjust, corrupt and incompetent socialist government of Hugo Chavez protege Nicolas Maduro just raided the offices of the main opposition party

    Also, they just expelled three U.S. diplomats.

    Here’s the skinny in a video nutshell:

    Torture, repression, censorship, media control; Chavez and Maduro certainly learned Fidel Castro’s old playbook.

    Ditto the economy, where inflation tops 50% and good shortages are widespread thanks to the usual socialist mismanagement and currency controls. (In just one indicator, Toyota suspended production in Venezuela due to the hard currency shortage. But at least Toyota sold 722 cars in January, while Ford sold a grand total of…2.)

    The situation in Venezuela can’t get better as long as the current socialist government is in power, but Maduro’s thugs won’t leave without a fight.

    Meet the Kronies

    Monday, February 3rd, 2014

    The Kronies has already been blogged by half the rightospehre, but it’s so well done that I wanted to post it here on the off-chance you haven’t watched it yet: