Wednesday, February 24, 2010

Barker's Newsbites: Wednesday, February 24, 2010


Here ya go, kids!

Read 'em and weep...
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21 comments:

William R. Barker said...

http://www.telegraph.co.uk/finance/currency/7300770/Concerns-grow-over-Chinas-sale-of-US-bonds.html

Evidence is mounting that Chinese sales of US Treasury bonds over recent months are intended as a warning shot to Washington over escalating political disputes rather than being part of a routine portfolio shift as thought at first.

China’s power is growing so fast that it now feels confident enough to raise the stakes on a string of festering conflicts with the US. It has threatened to impose sanctions on any US firm that takes part in a $6.4bn arms deal for Taiwan agreed by the White House. This is a tougher response that on any previous occasion and raises the spectre of a trade war over Boeing, the key supplier.

"Chinese leaders are deploying their reserves to try and pressure the US to stop haranguing China about its currency and trade policies, and to back off from interference in its domestic issues," said professor Eswar Prasad, ex-head of the IMF’s China division.

February 24, 2010 at 10:52 AM
William R. Barker said...

http://www.marketwatch.com/story/113-million-homeowners-underwater-on-mortgage-2010-02-23

More than 11.3 million homeowners -- nearly one-fourth of all Americans with a mortgage -- owe more on their loan than their home is now worth, according to a report released Tuesday by FirstAmerican CoreLogic.

More than 10% of people with mortgages owe 25% more than their home is worth.

The number of underwater mortgages increased by about 620,000 from the third quarter, the firm said. Another 2.3 million mortgages had less than 5% equity in their home, which could be wiped out if home prices fall further.

Underwater mortgages are concentrated in few states: California, Florida, Nevada, Arizona, Michigan and Georgia.

In Nevada, 70% of mortgages were underwater.

In California, more than a third of mortgages were underwater.

"The rise in negative equity is closely tied to increases in pre-foreclosure activity," CoreLogic said. Once a homeowner owes 25% more than the house is worth, foreclosure rates rise sharply.

Negative equity exceeded 25% in six states and topped 20% in six others.

February 24, 2010 at 10:53 AM
William R. Barker said...

http://www.cnsnews.com/news/article/61811

More than 300 U.S. soldiers have died in the war in Afghanistan since May 15, 2009, the day when the first major wave of new troops ordered by President Barack Obama arrived in the country.

The 308 U.S. casualties in Afghanistan since then account for about a third of the total of 920 U.S. casualties in the eight-year war.

Last year was the deadliest for American soldiers since the U.S.-led military effort in Afghanistan began in October 2001.

February 24, 2010 at 10:53 AM
William R. Barker said...

http://money.cnn.com/2010/02/22/autos/gm_fritz_henderson.fortune/?section=magazines_fortune

After resigning as president and CEO of General Motors in December, Fritz Henderson might have gone into hiding or decided to sit out the harsh Michigan winter on a Florida beach.

Instead, here he is popping up again, this time as a consultant to GM on international operations at the very fancy fee of $59,090 a month for 20 hours of work a month. That works out to almost $3,000 an hour for a CEO who was ousted after just eight months on the job.

February 24, 2010 at 10:53 AM
William R. Barker said...

http://www.timesonline.co.uk/tol/news/world/europe/article7038796.ece

A massive extension of maternity leave across Europe was last night voted for by the Womens’ Rights Committee of the European Parliament to make it compulsory for employers to pay mothers for a minimum of 20 weeks on full pay.

February 24, 2010 at 10:53 AM
William R. Barker said...

* PART 1 of 2

http://www.forbes.com/2010/02/20/stimulus-economy-business-opinions-columnists-john-tamny.html?boxes=opinionschannellighttop

Addressing a joint session of Congress in 1974, President Gerald Ford made the surprisingly lucid observation that "A government big enough to give you everything you want is a government big enough to take from you everything you have."

[Today] there's a rush among some of our best companies to solve the depressed outlook through the accession of government handouts or favor.

The examples of businesses seeking Washington's favor are many. As a Forbes article noted last November, JPMorgan Chase CEO Jamie Dimon "visits Washington almost once a month, seeking out politicians on both sides of the aisle." As Dimon put it to colleagues, "We learned a lesson here" - and the lesson was to do a better job of making nice with politicians.

According to a Wall Street Journal account of Bank of America CEO Brian Moynihan's first month on the job, the new bank head "is putting in as much time in Washington as he does in the bank's hometown of Charlotte, N.C."

And while the government measure of unemployment rate remains in nosebleed territory, lobbyists with political savvy are doing quite well. As USA Today's Fredreka Schouten recently reported, "The lobbying industry is humming along in the nation's capital, even for companies that have shed thousands of jobs in the past year."

ConocoPhillips laid off nearly 1,300 employees last year, but according to Schouten, it more than doubled its commitment to lobbying activities with spending of $18.1 million in 2009. Drug giant Pfizer spent $24.6 million last year vs. $12.2 million in 2008.

Rep. Paul Ryan, R-Wis., presently a darling among Republicans for his pro-growth policies, has long made known his dislike of the 2009 Obama stimulus plan as a "wasteful spending spree." Nice rhetoric for sure - and as it turns out not very pure. In October 2009 the congressman wrote a letter to Labor Secretary Hilda Solis in favor of a grant application in his district, which, according to Ryan, would "place 1,000 workers in green jobs."

The obvious irony in the effort among private companies to curry favor with cash-wielding politicians is that nothing in life is free. With our elected representatives having no resources of their own to dispose, what they give now must be taken back at some point. In that sense the political class will eventually have to reverse course by implementing taxes to recover the funds they so generously gave away.

* TO BE CONTINUED...

February 24, 2010 at 10:56 AM
William R. Barker said...

* CONCLUSION - PART 2 of 2:

In the meantime, however, heavy government spending on politically connected corporations will reduce the wages of individuals working for other, less connected firms in the private sector. Governments can't spend without taxing or borrowing first, so readers should know that companies living relatively high on Washington largesse are able to do so only thanks to reduced pay and employment opportunities for those firms lacking a "Washington strategy."

Worse for the well-connected, it's not just money that politicians will want in return for smoothing their earnings in a time of need. Indeed it's fair to assume that with the spending will come more regulations to achieve non-market outcomes.

We've already seen this among banks, which, as the alleged beneficiaries of TARP funds, have been "asked" by government bureaucrats to change their compensation structures in concert with "voluntary" initiatives to reduce mortgage payments for individuals unable to pay what they're contractually obligated to. Along those same lines GM will almost certainly will be required to manufacture more "green" cars than its customers desire, while Pfizer's future silence when it comes to innovation-inhibiting health care legislation will be bought with near-term money.

At their core regulations and supposedly voluntary government initiatives hamper the sole purpose of companies--the pursuit of profits. No profit means no investment, which means companies that successfully secure Washington help will achieve momentary stability at the expense of their longer-term health.

Indeed with corporate success increasingly a function of political connections as opposed to business skill, the re-orientation of precious capital away from the U.S. version of "crony capitalism" will almost without a doubt bring more economic pain than any near-term difficulties wrought by a weak economy would. In short companies will eventually pay dearly for hopping into bed with Washington now.

U.S. corporations are scared about the business climate, and with payrolls to meet along with impatient shareholders to please, it's perhaps understandable that they look anywhere and everywhere for an edge, including inside Washington. But as President Ford long ago made clear, a government that can give can also take, and for businesses to seek profits in Washington now is for them to enter into the most Faustian of bargains.

February 24, 2010 at 10:56 AM
William R. Barker said...

http://www.house.gov/htbin/blog_inc?BLOG,tx14_paul,blog,999,All,Item%20not%20found,ID=100222_3649,TEMPLATE=postingdetail.shtml

[By Congressman Ron Paul (R-TX)]

Last week marked the one year anniversary of the American Reinvestment and Recovery Act, or the stimulus bill, passing into law. While the debate over its success has been focused on whether or not it is stimulating the economy and on various questionable uses of funds, in my estimation this legislation is accomplishing exactly what it was intended to accomplish – grow the government.

[T]he American people know that more government spending obviously equals more government. If the goal was to strengthen the private sector, Congress would have allowed businesses and individuals to keep more of their own money through meaningful tax cuts.

Outrageously, the administration claims that they did “cut taxes” by reducing withholding, and that they have stimulated the private economy by increasing the amount of money in every worker’s paycheck. What they fail to mention is they did not change the total amount of taxes due. This means that all that money not withheld from paychecks will add up to a big unpleasant surprise when returns are filed this year. Many tax preparers are already seeing shocked taxpayers having to come up with big checks to the government when they normally expect a refund. Stimulus, indeed!

The administration also claims that thousands of jobs have been created or saved by this massive spending bill, but these are just more government jobs, and counterproductive in the long run. Funding for the public sector necessarily comes at the expense of an overtaxed private economy. But, it makes sense that government would seek to expand its payroll since every new bureaucrat becomes a likely advocate for big government, when an increasing number of Americans are demanding the opposite. But the more the burden, the closer the government parasite comes to killing its host.

Rather than learning the lessons of the past year, the administration is moving full-speed ahead to do even more economic damage. With the stimulus bill set as a precedent and victory declared, another “jobs” bill is in the works.

Tax increases on the middle class are notoriously back “on the table,” exposing that campaign promise as another instance of merely saying what the people wanted to hear.

[I]n order to address the unavoidable issues of our massive deficit, the administration has named a bi-partisan commission to find ways to decrease it. If the obvious solution to our spending problems was seriously put forth, that is, getting back to the constitutional limitations of government, I would be shocked. More likely, this will be a tactic to increase taxes and spending in a way that passes the political buck.

February 24, 2010 at 10:57 AM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704188104575083332005461558.html?mod=WSJ_hps_LEFTWhatsNews

U.S. banks posted last year their sharpest decline in lending since 1942...

Besides registering their biggest full-year decline in total loans outstanding in 67 years, U.S. banks set a number of grim milestones. According to the FDIC, the number of U.S. banks at risk of failing hit a 16-year high at 702. More than 5% of all loans were at least three months past due, the highest level recorded in the 26 years the data have been collected.

The struggling U.S. banking industry remains a problem for policy makers eager for banks to lend again. Lawmakers on Capitol Hill and administration officials have pushed banks to lend, particularly in light of the billions in taxpayer aid injected into the financial industry over the past two years. Banking groups and their members counter that they're under pressure from regulators to be more prudent and that demand from struggling consumers and businesses isn't there.

Initiatives such as the Obama administration's $30 billion small-business lending program will rely on banks making loans at a time when many of those same firms are wrestling with a rising tide of commercial real estate problems or being told to add to their reserves by regulators.

Bankers...say creditworthy borrowers are hard to come by. Fifth Third Bancorp recently extended a $3.5 million line of credit to Chicago-based One Hope United after the state of Illinois, beset by a budget crisis, delayed payments to the child-and-family-services provider. Steve Abbey, Fifth Third senior vice president, said One Hope United is a rare exception of a nonprofit borrower that could qualify for credit from Fifth Third because of a cash crunch. Most other nonprofits that need cash right now, "haven't set themselves up to borrow money and pay it back," Mr. Abbey said. "They just need money."

[A]sset-quality indicators for banks continued to deteriorate in the fourth quarter as borrowers continued to fall behind on their loans. Banks wrote down $53 billion in loans in the final three months of last year. The quarterly write-off rate was the highest ever recorded in the 26 years the FDIC has collected the data. A total of $391.3 billion of all loans and leases, or 5.4%, were at least three months past due at the end of 2009.

February 24, 2010 at 12:05 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704454304575081410550952700.html?mod=WSJ_Opinion_AboveLEFTTop

It didn't take long for Congress to try an end-run around the Supreme Court's landmark January decision in Citizens United v. FEC. With a campaign finance bill due to be introduced this week, Democrats are proposing to repeal the First Amendment, at least for some people.

Senator Chuck Schumer of New York and Representative Chris Van Hollen of Maryland want to prevent any company with more than 20% of foreign shareholders from spending money in U.S. elections, ban TARP recipients and government contractors from campaign spending, and require CEOs to pop up at the end of television commercials to "approve this message" just like politicians.

Maryland Democrat Donna Edwards and Michigan Democrat John Conyers are going further and proposing to amend the Constitution so it bars corporate free speech. John Kerry and Arlen Specter are also on board for a First Amendment rewrite.

At least these [prospective] Constitutional amenders [Edwards, Conyers, Kerry, and Specter] are honest about their goals and what it requires to be legal.

Not so Messrs. Schumer and Van Hollen, who want to sneak their speech bans by degrees into legislation. While current law already prevents foreign corporations from participating in U.S. elections, their proposal would silence some five million Americans who work for domestic subsidiaries of foreign companies and whose money is generated in the U.S. As a Constitutional matter, that amounts to telling some Americans that they may not engage in political speech—a formula the Supreme Court has rejected in such other recent cases as Davis v. FEC.

[Of course] the Democrats don't include unions in their speech bans... As former Federal Election Commission member Hans von Spakovsky points out, the Service Employees International Union often boasts of its hefty percentage of Canadian members. Should it be barred from donating to President Obama?

As for CEO appearances in advertisements, will trial lawyer donors have to do the same? How about SEIU chief Andy Stern? The double standard for unions and business betrays Mr. Schumer's real goal, which is a partisan fund-raising advantage for Democrats.

Citizens United blew a huge hole in the campaign finance rules, and there is no Constitutional way to refill it. The campaign-finance restrictionists should give up their misbegotten and illegal regulatory model and try deregulation and transparency instead. States like Virginia and Utah have no contribution limits but require disclosure and are among the best-run states in such traditional hallmarks of good government as economic health and development. The First Amendment has worked pretty well for 230 years. We don't need a rewrite.

February 24, 2010 at 12:06 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704188104575083520811873704.html

[O]ne of the largest tax increases for health care in history...[the] new ObamaCare bargain would for the first time apply the 2.9% Medicare payroll tax to "interest, dividends, annuities, royalties and rents," so-called passive income that we are told includes capital gains, though the latter wasn't explicitly mentioned in the proposal. This antigrowth investment tax would apply to singles earning more than $200,000 and joint filers over $250,000 and comes on top of the Senate's 0.9-percentage-point increase in the payroll tax, which would bring the combined employee-employer share to 3.8%.

In part this is a sneaky way of waging the House's war on "the rich"...

Speaker Nancy Pelosi's 5.4-percentage-point "surcharge" on modified adjusted gross income above $1 million—which also includes capital gains—was supposedly too extreme for the Senate, but the White House is trying to smuggle in its 2.9-percentage-point cousin. Of course, $250,000 is a lot lower income threshold than $1 million, and the rate can always be inched up later once the tax is already in place.

The House surcharge is certainly destructive but it is at least above-board. The White House levy muddies up both the tax code and Medicare financing.

The Medicare payroll levy was designed as a social insurance program with some connection, however attenuated, between taxes paid and benefits received. When Medicare passed in 1965 it was modelled after Social Security and the tax was supposed to be equivalent to a "premium" for guaranteed health-care insurance for seniors; everyone "contributed" at the same rate. Until 1993, the payroll tax was assessed only on the first $135,000 of wages, until the Clinton Administration and the Democratic Congress lifted the Medicare cap entirely.

The Clinton move was bad enough but Mr. Obama's plan fundamentally changes the nature of the government's health-care financing. Medicare's liabilities mean that it must receive injections of general revenue, but never before have Medicare's own "dedicated" revenues been siphoned off to fund another entitlement. Essentially, it turns Medicare financing into a wealth transfer program at a stroke.

The 0.9% increase is another tax on job creation, though Democrats claim they want more jobs. The devious 2.9% hike on investment income will raise the cost of capital, though Democrats claim to want more capital investment. Sometimes we wonder if Democrats even listen to their own rhetoric, or if they assume voters are too dumb to notice their contradictions.

If Americans need another reason to oppose ObamaCare, or more evidence of its destructiveness, here it is.

February 24, 2010 at 12:06 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704188104575083473537079844.html

[By John Yoo]

In office only one day, Mr. Obama ordered the shuttering of the detention facility at Guantanamo Bay, followed later by the announcement that he would bring terrorists to an Illinois prison. He terminated the Central Intelligence Agency's ability to use "enhanced interrogations techniques" to question al Qaeda operatives. He stayed the military trial, approved by Congress, of al Qaeda leaders. He ultimately decided to transfer Khalid Sheikh Mohammed, the planner of the 9/11 attacks, to a civilian court in New York City, and automatically treated Umar Farouk Abdulmutallab, who tried to blow up a Detroit-bound airliner on Christmas Day, as a criminal suspect (not an illegal enemy combatant). Nothing better could have symbolized the new president's determination to take us back to a Sept. 10, 2001, approach to terrorism.

Part of Mr. Obama's plan included hounding those who developed, approved or carried out Bush policies, despite the enormous pressures of time and circumstance in the months immediately after the September 11 attacks. Although career prosecutors had previously reviewed the evidence and determined that no charges are warranted, last year Attorney General Eric Holder appointed a new prosecutor to re-investigate the CIA's detention and interrogation of al Qaeda leaders.

* TO BE CONTINUED...

February 24, 2010 at 12:07 PM
William R. Barker said...

* CONTINUING...

[By John Yoo]

In my case, he let loose the ethics investigators of the Justice Department's Office of Professional Responsibility (OPR) to smear my reputation and that of Jay Bybee, who now sits as a federal judge on the court of appeals in San Francisco. Our crime? While serving in the Justice Department's Office of Legal Counsel in the weeks and months after 9/11, we answered in the form of memoranda extremely difficult questions from the leaders of the CIA, the National Security Council and the White House on when interrogation methods crossed the line into prohibited acts of torture.

Rank bias and sheer incompetence infused OPR's investigation. OPR attorneys, for example, omitted a number of precedents that squarely supported the approach in the memoranda and undermined OPR's preferred outcome. They declared that no Americans have a right of self-defense against a criminal prosecution, not even when they or their government agents attempt to stop terrorist attacks on the United States. OPR claimed that Congress enjoyed full authority over wartime strategy and tactics, despite decades of Justice Department opinions and practice defending the president's commander-in-chief power. They accused us of violating ethical standards without ever defining them. They concocted bizarre conspiracy theories about which they never asked us, and for which they had no evidence, even though we both patiently—and with no legal obligation to do so—sat through days of questioning.

OPR's investigation was so biased, so flawed, and so beneath the Justice Department's own standards that last week the department's ranking civil servant and senior ethicist, David Margolis, completely rejected its recommendations.

In 2005, a Navy Seal team dropped into Afghanistan encountered goat herders who clearly intended to inform the Taliban of their whereabouts. The team leader ordered them released, against his better military judgment, because of his worries about the media and political attacks that would follow.

In less than an hour, more than 80 Taliban fighters attacked and killed all but one member of the Seal team and 16 Americans on a helicopter rescue mission. If a president cannot, or will not, protect the men and women who fight our nation's wars, they will follow the same risk-averse attitudes that invited the 9/11 attacks in the first place.

Without a vigorous commander-in-chief power at his disposal, Mr. Obama will struggle to win any of these victories. But that is where OPR, playing a junior varsity CIA, wanted to lead us. Ending the Justice Department's ethics witch hunt not only brought an unjust persecution to an end, but it protects the president's constitutional ability to fight the enemies that threaten our nation today.

February 24, 2010 at 12:07 PM
William R. Barker said...

http://blog.heritage.org/2010/02/24/morning-bell-president-obamas-pro-business-policies-are-killing-the-free-market/print/?utm_source=Newsletter&utm_medium=Email&utm_campaign=Morning%2BBell

Last night President Barack Obama held a behind-closed-door dinner with 17 chief executive officers from major U.S. corporations including Jamie Dimon of JP Morgan Chase, Verizon Communications' Ivan Seidenberg, and General Electric's Jeffrey Immelt. According to Bloomberg, the President made the case to his select guests that his administration is "fundamentally business-friendly." This comes almost two weeks after the President told BusinessWeek: "[T]he irony is, is that on the left we are perceived as being in the pockets of Big Business. And then on the business side, we are perceived as being anti-business."

What the President fails to understand is that there is no irony here. It is entirely consistent for big government policies that favor select and politically connected big corporations to hurt the economy as a whole. In fact, almost all well-intentioned government interventions in the market place do exactly that.

[T]he reason the health care, education, and energy sectors all failed to improve quality, efficiency, and productivity in the 80s is because those sectors were, and continue to be, the sectors most dominated by government intervention: our education system is a near total government monopoly; the federal government controls the majority of health care spending in this country, and our environmental laws make new energy development in this country virtually impossible. But President Obama seems completely oblivious to these facts. He is supremely confident that his government "pro-business" interventions will be ahistorically successful.

Never mind that President Obama's cap and trade proposal would be worth billions to select power companies but cost the U.S. economy as a whole trillions of dollars.

Never mind that his health care plan would turn health insurance companies into public-utility like monopolies at tremendous cost to small businesses.

Never mind that the President's big labor-friendly tax hikes would cripple American competitiveness.

President Obama's "pro-business" TARP related actions helped lower the United States rank in the 2010 Index of Economic Freedom, from "free" to "mostly free."

The President must stop having behind-closed-door meetings with his favorite CEOs and start pursuing an economic agenda that helps everyone.

February 24, 2010 at 12:47 PM
William R. Barker said...

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=522007

[W]hile beating up Toyota may serve the political aims of some, its real effect will be to kill jobs, corrupt any semblance of impartial regulatory action, discourage foreign investment, and defund cities and towns whose tax bases depend much on Toyota dealers. In short, the show trial will make us all poorer.

For starters, Toyota employs over 200,000 Americans across the spectrum of the auto industry. Parts plants, assembly plants, dealerships and repair shops all owe their existence to Toyota.

Already plants are shutting down and employees are being laid off, beyond all proportion to the recall problem, because of the congressional effort to drag Toyota through the mud.

]Local and state] governments take in significant revenues from these operations. Don't think they won't feel the impact of these hearings.

Yet there's more than a whiff of Saul Alinsky's community organizing principles in this noisy government campaign against Toyota — "Pick a target, personalize it, freeze it, polarize it."

The effort to take [Toyota] down continues because of one thing the unions — and the union-friendly Obama administration — can't forgive: Toyota's choice of states for its plants, states with good investment climates and nonunion right-to-work laws.

As U.S. rivals like GM and Chrysler survive on government bailout money and continue to employ inefficient and expensive union labor, and their U.S. government owners try to regain market share for them, what better way than to discredit Toyota out of all proportion to its supposed sins by using Alinsky-style tactics?

Evidence is piling up that this is political.

First, Transportation Secretary Ray LaHood, who has a conflicting dual role as both regulator and owner of rival auto companies, advised Americans not to drive Toyotas.

Now Politico reports that Rep. Darrell Issa, R-Calif., of the House Oversight and Government Reform committee is calling for an investigation of Transportation department officials' e-mails. These may show they improperly conferred with insurance agency officials about congressional testimony to cover up for Transportation Department neglect of its regulatory duties.

In an atmosphere like this, why would Toyota want to invest more, hire more or try to please political powers as a good corporate citizen? Or any other company?

As Congress tries to discredit Toyota and destroy its market share out of all proportion to its transgressions, the ultimate effect will be to hurt America's interests most.

February 24, 2010 at 6:23 PM
William R. Barker said...

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=522005

The godfather of climate hysteria is in hiding as another of his wild claims unravels — this one about global warming causing seas to swallow us up.

We've not seen or heard much of the former vice president, Oscar winner and Nobel Prize recipient recently as the case for disastrous man-made climate change collapses.

Perhaps he's off reading how scientists were forced to withdraw a study on a projected sea level rise due to global warming after finding two "technical" mistakes that undermined the findings.

Al Gore, in his award-winning opus, "An Inconvenient Truth," laughingly called a documentary, foretold an apocalyptic vision of the devastation caused by a 20-foot rise in sea levels due to melting polar ice caps "in the near future."

Now Mark Siddall, from the Earth Sciences Department at England's University of Bristol, has formally retracted the study. "One mistake was a miscalculation; the other was not to allow fully for temperature change over the past 2,000 years," he said.

Last November, Al Gore was hailed by Newsweek as "The Thinking Man's Thinking Man."

Since then we and he have been given much to think about, starting with the damning e-mails from researchers associated with the Climate Research Unit at the University of East Anglia in Britain. The e-mails revealed an organized attempt to "hide the decline" in global temperatures, to manipulate data to fit preconceived conclusions, and to discredit and shun reputable skeptics.

A key finding of the IPCC, which along with Al Gore won the Nobel Peace Prize in 2007, was revealed last month to be utterly bogus. The IPCC claimed glaciers in the Himalayas would likely disappear by 2035. The only thing they had to back it up was a 1999 non-peer reviewed article in an Indian mass-market science magazine.

It's been revealed that researchers at the National Oceanic and Atmospheric Administration have been systematically eliminating weather stations, with a clear bias toward removing colder latitude and altitude locations. The number of reporting stations in Canada dropped from 600 to 35, with only one station used by the NOAA as a temperature gauge for Canadian territory above the Arctic Circle.

One by one, Gore's prophecies of doom and those of the climate charlatans he inspired are being exposed as the work of con artists. From the CRU to the IPCC, the climate dominoes are falling one by one. His silence speaks volumes.

February 24, 2010 at 6:24 PM
William R. Barker said...

http://biggovernment.com/tshepherd/2010/02/24/dept-of-homeland-security-loses-over-1000-computers-in-one-year/

New documents show that component agencies of DHS, specifically Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP) combined to lose no less than 985 computers in fiscal year 2008. Along with other component agencies in DHS, well over 1,000 computers were lost.

But the inventories of lost stolen and damaged equipment don’t stop with just computers. They include radiation detectors, night vision scopes (hundreds of them), night vision goggles, lost vehicles, lost blackberries, computer servers, expensive radios and radio repeaters.

CBP maintains that the computer losses were within acceptable standards for asset management, saying the losses only represented about .5% of their total computer inventory.

Also, CBP categorically stated that no sensitive information was on any of the 500-plus lost computers from their component agency. If that’s true, it makes you wonder what exactly they use their computers for. Shouldn’t one expect that a CBP computer maintains plans, databases, maps, anything at all, that relates to the securing of the nation’s borders?

February 24, 2010 at 7:55 PM
William R. Barker said...

* PART 1 of 2

http://www.bloomberg.com/apps/news?pid=20601039&sid=a2ArEkqK7AZ4

Should a business owner be allowed to run personal expenses through his company to get a tax break?

Should an insurer charge the same premium for an unscathed house as it does for one that is already on fire?

If you followed the logic of the current health-care bills before Congress, the answer to both questions would be “yes.”

U.S. President Barack Obama has called for a bipartisan discussion of health-care reform while Congressional Democrats ponder passing their current bills through reconciliation. Our national health-care debate is far from over. However, while we use the words “health insurance” a lot, we haven’t been talking about insurance as we commonly know it.

True insurance comprises two things. The first one is a goal: to protect against very large losses. The second one is a method: the proper assessment and pricing of risk.

Our system, and the bills passed separately by the Senate and House, centers on the provision of all health services, including routine and minor care, not just coverage for unaffordable surprise costs. In addition, the reform bills say insurers must no longer discriminate on the basis of pre-existing conditions. Even some Republicans agree with this idea, making it one of the few that might be called bipartisan.

Nevertheless, these [ill-conceived ideas] move us further away from insurance and are a bad idea. What we need is real insurance, yet our current system and proposals look nothing like it.

The U.S. has the best health care in the world if you are really sick, proven by the many people who come here to cure their diseases. The wrong kind of reform could ruin this excellence while raising total costs.

When people today refer to their health insurer, they mean the payer of all their health-care bills (ignoring deductibles and copayments). That isn’t how they refer to homeowners insurance, which generally only protects against large losses.

Why has this occurred? Well, there is a tremendous tax advantage to purchasing anything called “health insurance” through your employer. This has encouraged the broadening of the definition of health insurance to cover all things related to health in order to maximize this tax break.

It’s the equivalent of a businessman who runs his personal expenses through his company so they are deductible. But he can go to prison if caught, while companies are applauded for offering ever broader health coverage.

Having businesses offer full health coverage almost from the first dollar spent is phenomenally inefficient. Health care is over-consumed because it is essentially, at the margin, free to employees and too cheap - fully deductible - to the company. All incentive for the consumer to control costs is abandoned.

Furthermore, the system is nonportable and famously bureaucratic, with the associated costs in time, money and frustration.

To put the “insurance” back in health insurance, we need to remove the tax deduction for routine health-care expenses, whether the coverage is purchased by employers or individuals. If we choose to retain a deduction for insurance against large losses, it should apply equally to plans bought by individuals directly and those provided by employers.

* TO BE CONTINUED...

February 24, 2010 at 7:56 PM
William R. Barker said...

* CONTINUING... Part 2 of 2 --

Now let’s discuss risk assessment.

Ignoring pre-existing conditions might sound compassionate, but it is equivalent to declaring that a fire-insurance company must charge the same amount for a modern house with smoke detectors and interior fireproofing as for a century-old, wooden-frame former stable, complete with some hay left over, and a basement full of painting supplies.

Taking the analogy further, the same premium must be charged for a well-protected, unscathed house as for one that is already on fire.

The business of insurance is about determining risk and charging accordingly. It’s why insurance companies exist. If we eliminate that, medical insurers are just form-processing companies for the government. Worse, we lose a valuable economic input: that of accurate risk assessment and pricing, without which sensible management of medical expenses is impossible.

The desire to help those with pre-existing conditions is laudable. The way to do this is to help. If someone needs more medical care than he or she can pay for, direct state subsidy is far more efficient than making insurance companies pretend that the patient isn’t ill or at high risk of becoming ill.

We can separately debate the degree of generosity of this subsidy, but it is efficient and honest. Making insurance companies play “don’t ask, don’t tell” with health status is neither.

Creating a system of real health insurance, along with honest subsidy where necessary, is the simple solution to many of our problems, and an honest first step toward tackling the rest.

February 24, 2010 at 7:56 PM
William R. Barker said...

http://article.nationalreview.com/425992/accounting-for-fannie-and-freddie/stephen-spruiell

Back in December, while the holidays had everyone distracted, the Obama administration released a little-noticed announcement that it would be lifting the caps on federal assistance to Fannie Mae and Freddie Mac, the troubled mortgage giants that collapsed in the summer of 2008. With this surprise Christmas gift, the agencies were given unfettered access to the taxpayers’ wallet, and their absorption by the federal government became complete.

But the White House still is not accounting for Fannie and Freddie the way it accounts for other federal entities.

A group of House Republicans has introduced a measure that would change that. The Accurate Accounting of Fannie Mae and Freddie Mac Act would compel the Office of Management and Budget to account for the losses sustained by the agencies since they were taken over by their federal regulator.

The administration is resisting, because this act would force it to do two things: First, according to the Congressional Budget Office, the administration’s policy of unlimited support for Fannie and Freddie would require it to add around $300 billion to this year’s record $1.4 trillion deficit — and some critics say it should add much more. And second, the act would force the administration to ask Congress to raise the debt limit — again.

The author of the administration’s budget — and thus the man responsible for omitting Fannie and Freddie — is OMB director Peter Orszag. The omission puts Orszag in a tough spot: As CBO director in 2008, Orszag recommended that, because Fannie and Freddie were federally controlled and financed, they should be placed “on budget.”

“Obviously he answers to a different master now,” says Rep. Scott Garrett (R., N.J.), one of the Republicans who introduced the measure. “CBO is [supposed to be] non-partisan, and now he’s acting in a partisan manner. The American public is looking for non-partisanship or bipartisanship, and not a partisan slant on the numbers.”

The administration has accounted for the Treasury Department’s infusions of capital into Fannie and Freddie — an amount currently totaling approximately $100 billion and projected to grow by another $60 billion over the next two years — but it has not accounted for the subsidy costs of insuring the agencies against total collapse. As mentioned above, CBO puts those costs at around $300 billion.

But others point to numerous other subsidies taxpayers have provided to Fannie and Freddie. The Federal Reserve has created almost $2 trillion in order to purchase mortgage-backed securities, reasoning that the purchases were necessary to keep the mortgage market liquid and mortgage interest rates low. The program has kept the agencies afloat, but with unknowable consequences for the future value of the currency.

And then there is the mind-boggling size of the agencies’ obligations: According to one estimate, Fannie and Freddie’s liabilities total $6.3 trillion, all of which the government is now theoretically on the hook for.

February 24, 2010 at 7:57 PM
William R. Barker said...

http://healthcare.nationalreview.com/post/?q=Njk4NmQ3YmI1N2QzMWFjMzFiY2ZlMmVjNGUxZTNiMGM=

For an administration that says it’s committed to using empirical evidence to determine “what works,” and a president who says he’s “not an ideologue,” Obamacare’s marketing sure does rely on a healthy dose of fiction.

The central inference behind the supposed need to pass Obamacare is that insurance companies are shamelessly gouging us and disproportionately driving up the costs of our entire health-care system.

This is demonstrably false. But the Obama administration’s failure to recognize — or to admit — this inconvenient truth, largely explains why its proposed remedies would not only fail to drive health costs down, but would instead raise them up even further.

According to the most recent Fortune 500 rankings, health insurers are not even among the top-30 United States industries in profit-margin. Health insurers rank 35th, with a profit-margin of just 2.2% — less than one-fifth the profit-margin of... [er...] railroads.

Health insurers’ collective profit-margin is less than one-eighth that of drug companies and less than one-seventh that of companies that sell medical products or equipment. It’s also less than that of medical facilities.

Yet when was the last time you heard President Obama rail against greedy hospitals?

The combined profits of America’s ten largest health insurers are $8.3 billion. That’s less than two-thirds of the profits of Wal-Mart alone, less than half of the profits of General Electric alone, and less than one-seventh of what Medicare loses each year to fraud. Health insurers collectively have one-eighth the profit-margin of McDonald’s or Coke, one-ninth that of eBay, and one-fifteenth that of Merck.

Why don’t these much more profitable companies or industries need to be taken over by the federal government? Why don’t they need to be subjected to something like President Obama’s proposed Health Insurance Rate Authority, which would be run by the same U.S. Department of Health and Human Services that already loses $60 billion of taxpayer money to Medicare fraud each year? (Not that I want to give the Obama administration any ideas.)

Anyone but an ideologue could plainly see that insurance profits aren’t the problem. The problem is having a health-care system with too many middlemen (government or otherwise); too little competition and choice; and too little opportunity for Americans to control their own health-care dollars, shop for value, or even see prices.

If you can’t identify the problem, you aren’t likely to stumble upon the solution. Maybe that’s why the Congressional Budget Office says that, under Obamacare, which would cost $2.5 trillion in its real first decade (2014 to 2023), the average family’s insurance premiums in the individual market would increase by $2,100 in relation to current law — while under the House Republican health bill, which would cost $61 billion (just 2 percent as much as Obamacare), the average premiums would be reduced by 5 to 8 percent.

February 24, 2010 at 7:58 PM

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