Tuesday, March 23, 2010

Barker's Newsbites: Tuesday, March 23, 2010


Well, folks... we start off today's newsbites with commentary from the brilliant Dr. Thomas Sowell.

From there...

We'll see.
Posted by at

12 comments:

William R. Barker said...

http://www.realclearpolitics.com/articles/2010/03/23/a_point_of_no_return_104867.html

The corrupt manner in which this massive legislation was rammed through Congress, without any of the committee hearings or extended debates that most landmark legislation has had, has provided a roadmap for pushing through more such sweeping legislation in utter defiance of what the public wants.

Too many critics of the Obama administration have assumed that its arrogant disregard of the voting public will spell political suicide for Congressional Democrats and for the President himself. But that is far from certain.

True, President Obama's approval numbers in the polls have fallen below 50% and that of Congress is down around 10%. But nobody votes for Congress as a whole, and the President will not be on the ballot until 2012.

* DR. SOWELL IS CORRECT. JUST HARKEN BACK TO FDR'S "REIGN."

They say that, in politics, overnight is a lifetime. Just last month, it was said that the election of Scott Brown to the Senate from Massachusetts doomed the health care bill. Now some of the same people are saying that passing the health care bill will doom the administration and the Democrats' control of Congress. As an old song said, "It ain't necessarily so."

The voters will have had no experience with the actual, concrete effect of the government takeover of medical care at the time of either the 2010 Congressional elections or the 2012 Presidential elections. All they will have will be conflicting rhetoric; and you can depend on the mainstream media to go along with the rhetoric of those who passed this medical care bill.

* EXACTLY RIGHT.

The ruthless and corrupt way this bill was forced through Congress on a party-line vote, and in defiance of public opinion, provides a road map for how other "historic" changes can be imposed by Obama, Pelosi and Reid.

What will it matter if Obama's current approval rating is below 50% among the current voting public, if he can ram through new legislation to create millions of new voters by granting citizenship to illegal immigrants?

(*NOD*)

That can be enough to make him a two-term President, who can appoint enough Supreme Court justices to rubber-stamp further extensions of his power.

* AND THE LOGIC OF ALL THIS IS WHAT MAKES ME FEAR THAT AT A CERTAIN POINT THE RESPONSE OF TRUE CONSTITUTIONALISTS WILL BE... VIOLENCE.

* YOU THINK IT CAN'T HAPPEN HERE? PUSH PEOPLE FAR ENOUGH AND... (*SIGH*)

When all these newly minted citizens are rounded up on election night by ethnic organization activists and labor union supporters of the administration, that may be enough to salvage the Democrats' control of Congress as well.

The last opportunity that current American citizens may have to determine who will control Congress may well be the election in November of this year. Off-year elections don't usually bring out as many voters as Presidential election years. But the 2010 election may be the last chance to halt the dismantling of America. It can be the point of no return.

March 23, 2010 at 4:28 PM
William R. Barker said...

http://www.realclearpolitics.com/articles/2010/03/23/yoke_of_government_tightens_around_the_public_neck_104878.html

"To be governed," Proudhon wrote, "is to be watched, inspected, spied upon, directed, law-driven, numbered, regulated, enrolled . . . by creatures who have neither the right nor the wisdom nor the virtue to do so. To be governed is to be at every operation, at every transaction noted, registered, counted, taxed . . . . It is, under pretext of public utility, and in the name of the general interest, to be placed under contribution, drilled, fleeced, exploited . . . then, at the slightest resistance, the first word of complaint, to be repressed, fined, vilified, harassed, hunted down, abused . . . and to crown all, mocked, ridiculed, derided, outraged, dishonored. That is government; that is its justice; that is its morality."

Those who do not yet feel as Proudhon did should wait. ... When this government intervention fails to achieve the stated aims, liberals will blithely and obtusely insist the cure is yet more government intervention. They are like the carpenter who complains he has cut a board three times and it's still too short.

[I]ncreased federal involvement in health care will become a pretext for increased federal involvement in, well, everything. The reasoning will be that individual health affects health care, which is now a federal enterprise. And everything can be said, with more or less sophistry, to affect individual health. So "managing" the "system" will become the all-purpose excuse for dictating the manner in which you live your life. ... Liberals might feel complacent about all of this. But their complacency amounts to complicity in the one-way ratchet that tightens the yoke of government around the public neck.

Throughout the Bush years, progressives howled as the administration exploited a national-security crisis to expand executive power, while conservatives egged the administration on.

* ABSOLUTELY TRUE TO A LARGE EXTENT - AT LEAST WHEN YOU'RE TALKING "MAINSTREAM" REPUBLICAN "CONSERVATISM." ON THE OTHER HAND, LIBERTARIAN CONSTITUTIONALISTS SUCH AS MYSELF WERE OFTEN CLOSER ALIGNED TO "THE LEFT" THAN "THE RIGHT" WHEN IT CAME TO THESE MATTERS.

* JUST REMINDING FOLKS (WHILE PATTING MYSELF ON THE BACK) THAT WHETHER YOU TEND TO AGREE OR DISAGREE WITH ME, I REPRESENT AN INTELLECTUALLY CONSISTENT WORLDVIEW.

Bush did not even try to roll back expansions of federal power undertaken in the name of social policy. To the contrary, the administration accelerated the process with the Medicare prescription-drug benefit and the No Child Left Behind Act.

* TRUE!

During the past year President Obama has dashed progressives' naive hopes that he would roll back authority claimed in the War on Terror. He has done quite the opposite - supporting extension of controversial Patriot Act provisions; fighting in court for warrantless wiretapping; and adopting wholesale Bush's policies on indefinite detention without trial, rendition to torture abroad, military commissions, and the state-secrets privilege.

* ALSO TRUE...!!!

* BEYOND THE ACKNOWLEDGMENT, LET ME ALSO ADD - PLAYING "LIBERAL" - THAT IF ONE BUYS THE ARGUMENT THAT BUSH IS/WAS A DUMMY AND OBAMA IS FAIRLY BRILLIANT... THEN OBAMA'S "SINS" OF HYPOCRACY ARE WORSE THAN BUSH'S BECAUSE ONE ASSUMES OBAMA SHOULD "KNOW BETTER."

Obama also has pushed relentlessly for expansions of social welfare and the regulatory state. Every administration expands power where it wishes, but no authority is ever repealed. And so the ratchet tightens. Click, click, click . . .

March 23, 2010 at 4:46 PM
William R. Barker said...

http://www.realclearpolitics.com/articles/2010/03/22/obama__pelosis_agenda_of_spreading_dependency_104865.html

[T]he [American healthcare] system's costliest defect - untaxed employer-provided insurance, which entangles a high-inflation commodity, health care, with the wage system - remains.

Obama could not challenge this without adopting measures - e.g., tax credits for individuals, enabling them to shop for their own insurance - that empower individuals and therefore conflict with his party's agenda of spreading dependency.

On Sunday, as will happen every day for two decades, another 10,000 baby boomers became eligible for Social Security and Medicare. ... Congress has a one-word response to the demographic deluge and the scores of trillions of dollars of unfunded liabilities: "More."

There will be subsidized health insurance for families of four earning up to $88,200 a year, a ceiling certain to be raised, repeatedly.

The accounting legerdemain spun to make this seem affordable - e.g., cuts (to Medicare) and taxes (on high-value insurance plans) that will never happen - is Enronesque.

As America's teetering tower of unkeepable promises grows, so does the weight of government, in taxes and mandates that limit investments and discourage job creation. America's dynamism, and hence upward social mobility, will slow, as the economy becomes what the party of government wants it to be - increasingly dependent on government-created demand.

* AGAIN... SINCE I BELIEVE ALL THIS TO BE TRUE, AND SINCE I BELIEVE OTHERS BELIEVE IT, I CAN'T HELP BUT PREDICT THAT SOONER RATHER THAN LATER WE'RE GOING TO SEE CITIZEN VIOLENCE DIRECTED AT GOVERNMENT IN A DESPERATE ATTEMPT TO STOP THE ILL EFFECTS DESCRIBED ABOVE FROM FURTHER DESTROYING THE COUNTRY.

* I'M NOT SAYING I'D DO IT; I'M NOT THAT BRAVE. I'M NOT SAYING I'D SUPPORT SUCH EFFORTS; THAT WOULD BE A CRIME. I'M JUST GIVING MY PREDICTION BASED UPON HOW I SEE THE DOTS CONNECTING.

Promoting dependency is the Democratic Party's vocation. It knows that almost all entitlements are forever, and those that are not - e.g., the lifetime eligibility for welfare, repealed in 1996 - are not for the middle class.

Democrats believe, plausibly, that middle-class entitlements are instantly addictive and, because there is no known detoxification, that class, when facing future choices between trimming entitlements or increasing taxes, will choose the latter. The taxes will disproportionately burden high earners, thereby tightening the noose of society's dependency on government for investments and job-creation.

Politics in a democracy is transactional: Politicians seek votes by promising to do things for voters, who seek promises in exchange for their votes. Because logrolling is how legislative coalitions are cobbled together in a continental nation, the auction by which reluctant House Democrats were purchased has been disillusioning only to sentimentalists with illusions about society's stock of disinterestedness.

Forbidding insurance companies to deny coverage to persons because of pre-existing conditions, thereby making the risk pool more risky, will increase the cost of premiums. Public complaints will be smothered by more subsidies. So dependency will grow.

Seeking a silver lining?

* NO. NO I DON'T.

March 23, 2010 at 5:04 PM
William R. Barker said...

http://www.realclearpolitics.com/articles/2010/03/23/its_a_civil_war_what_we_do_now_104875.html

A terrible thing happened to America on Sunday, March 21, 2010. The country took its biggest step ever down a road diametrically opposed to its original intent of keeping the state small so that the individual can be free and great. Therefore, in this unprecedented crisis of values, this is what needs to be done: Know and teach America's core values.

[O]ver the past few generations, Americans have forgotten the values that have made America distinctive and great. People who do not understand [or who simply reject] American ideals - especially small government - now dominate our schools, our entertainment media and our news media.

Recognize that we are fighting the Left, not liberals. Conservatives and centrists are no longer fighting liberals. We are fighting the Left.

]Big L] Liberalism believed in American exceptionalism; the Left not only does not believe in it, the Left opposes it.

Liberalism believed in creating wealth; the Left is interested in redistributing it.

Liberalism believed in a strong defense. The Left believes in cutting defense and a strong United Nations.

* BTW, I TOO BELIEVE IN CUTTING DEFENSE - BASED UPON MY BELIEF THAT OUR "DEFENSE" DEFINITION AS WELL AS OUR "DEFENSE" MEANS ARE BLOATED. I BELIEVE IN THE STRONGEST AMERICAN MILITARY *NECESSARY* - NOT THE STRONGEST AMERICAN MILITARY POSSIBLE. (GET WHERE I'M COMING FROM...???)

Democrats should be referred to as Social Democrats.

* SADLY... BASICALLY TRUE.

This is not meant to be cute, let alone as a slur. But calling Democrats Social Democrats is an effective way of reminding Americans that there is no longer any difference between what is now known as the Democratic Party and the Social Democratic parties of Europe.

* AGAIN... SADLY TRUE; AT LEAST MORE TRUE THAN FALSE WHEN IT COMES TO FEDERAL, STATE, AND URBAN GOVERNMENTAL POLICIES.

We must single-mindedly work to repeal the government health plan. We all know that it is difficult to repeal entitlements because they are like drugs and it is very difficult to wean people off drugs. But it is not impossible. We need to warn our fellow Americans that entitlements will do to America what drugs eventually do to addicts.

All Republicans must run for office on the "repeal" issue. Even when they lose, the difference between right and left, between Republicans and Social Democrats will have been made clear; and clarity is our best friend. Our motto: "The bigger the government, the smaller the citizen."

Neither Republicans nor conservatives are united on every issue facing America. Immigration is one example. But we are united on the big government vs. free individual issue, which, more than anything else, has defined America. If we allow any other domestic issue to divide us, we will lose.

[T]he Left and the rest of the country share almost no values. The American value system and the Lleftist value system are irreconcilable. If the Left wins, America's values lose. If American values prevail, the Left loses. After Sunday's vote, for the first time in American history, one could no longer confidently believe that the American system will prevail. And if we don't fight for it, we don't deserve it.

March 23, 2010 at 5:25 PM
William R. Barker said...

http://www.legislature.idaho.gov/legislation/2010/H0391.pdf

The power to require or regulate a person’s choice in the mode of securing health care services, or to impose a penalty related thereto, is not found in the Constitution of the United States of America, and is therefore a power reserved to the people pursuant to the Ninth Amendment, and to the several states pursuant to the Tenth Amendment. The state of Idaho hereby exercises its sovereign power to declare the public policy of the state of Idaho regarding the right of all persons residing in the state of Idaho in choosing the mode of securing health care services.

It is hereby declared that the public policy of the state of Idaho, consistent with our constitutionally recognized and inalienable rights of liberty, is that every person within the state of Idaho is and shall be free to choose or decline to choose any mode of securing health care services without penalty or threat of penalty.

* HERE'S THE BOTTOM LINE, THOUGH: IF THIS ACT OF THE LEGISLATURE OF IDAHO IS TO HAVE ANY EFFECT IN THE REAL WORLD, IT MUST BE BACKED UP BY THE POLICE POWERS OF THE STATE - i.e. THE GOVERNOR OF IDAHO WOULD HAVE TO ORDER THE STATE POLICE AND NATIONAL GUARD OF IDAHO TO PROTECT THE RIGHTS OF IDAHO CITIZENS BY FORCE IF NECESSARY SHOULD THE FEDERAL GOVERNMENT ACT TO ENFORCE THEIR (UNCONSTITUTIONAL) LEGISLATIVE MANDATE BY FORCE.

* THE OTHER OPTION GOES OF COURSE WITH THE POINTS I'VE BEEN MAKING THROUGHOUT THIS EDITION OF BARKER'S NEWSBITES, NAMELY: IDAHO CITIZENS THEMSELVES MAY WELL READ THIS LEGAL ACT OF THEIR LAWFUL STATE GOVERNMENT AS GIVING THEM INDIVIDUAL AUTHORITY TO DEFEND THEMSELVES AGAINST FEDERAL ACTION TAKEN IN DIRECT DEFIANCE OF THE U.S. CONSTITUTION'S NINTH AND TENTH AMENDMENTS (OF THE BILL OF RIGHTS).

March 23, 2010 at 5:51 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704207504575129903919653226.html?mod=WSJ_Opinion_AboveLEFTTop

The Obama Administration wants to revise the No Child Left Behind education law...many of the proposed fixes would weaken the statute and undermine the Administration's twin goal of raising state education standards.

Some of the White House proposals make sense, such as the push for more charter schools that can focus on the specific needs of their student populations by operating outside of collective bargaining agreements.

We also like using student test scores to measure an instructor's effectiveness and influence teacher pay. Both reforms are strongly opposed by the teachers unions, and Team Obama deserves credit for putting children ahead of the National Education Association.

(*THUMBS UP*)

Other parts of its proposal leave us scratching our heads. The Administration wants to junk NCLB's requirement that all students be proficient in reading and math by 2014 and replace it with an equally unrealistic goal of making all kids "college ready" by 2020. By this thinking, it's impossible to teach every kid to read at grade level within the next three years, but getting all of them ready for higher education six years later is doable.

(*SNORT*) (*SMIRK*)

The worst parts of the proposal diminish or eliminate NCLB's accountability and choice provisions. Poor kids in persistently failing schools would lose their access to free private tutoring and the option to transfer to another school.

We're glad to see the Administration would maintain annual math and reading tests in grades 3 through 8, and that school districts would continue to disaggregate results by race and other factors to prevent schools from hiding achievement gaps. But the proposal would also allow for less rigorous and more subjective assessments—such as how "creative" a child is—to measure student progress, which could easily become an accountability loophole.

As worrisome is a call to drop the "adequate yearly progress" provision in NCLB that uses math and reading scores to determine whether districts are moving students toward proficiency. Currently, underperforming schools face federal penalties. But in the name of "flexibility," President Obama and Education Secretary Arne Duncan want to return to a policy that lets states and school districts independently determine when and whether to provide remedies for most of their failing schools. Never mind that it was state neglect of such schools that led a bipartisan majority in Congress to pass No Child Left Behind Act in the first place.

(*SMIRK*) (*ROLLING MY EYES*)

The only good argument for federal intervention in local education is to challenge failure and promote higher standards, and if a revision of NCLB is going to water that down, then better to do nothing at all.

March 23, 2010 at 8:54 PM
William R. Barker said...

* TWO-PARTER (Part 1 of 2)

http://online.wsj.com/article/SB10001424052748703621104575139732486806838.html

Angela Braly, CEO of insurer WellPoint...was recently hauled before Congress to justify her company's proposed 39% rate hike in California.

She explained the source was two-fold: rising medical costs and healthier customers dropping their coverage, forcing the sick to pick up the tab.

Now this sounds like two problems, but for WellPoint and other insurers it's really only one problem. Once everyone is required by government mandate to buy insurance, the industry's survival is no longer threatened: It can just pass its skyrocketing costs along to customers.

Once customers can no longer refuse to buy the industry's product, the problem of costs won't be fixed, but it no longer is the insurance industry's problem.

There, in that one sentence, we give you the failure of ObamaCare, the failure of the congressional health-care debate, the failure of health-care politics in this country.

Health insurers, and indeed Corporate America as a whole, are like monkeys who are caught by staking a glass jar to the ground with a shiny trinket inside. They won't let go so they can't get their hands out of the jar. That trinket is the ruinous and regressive $250 billion-a-year tax benefit for employer-provided insurance.

Corporate America isn't brave enough to argue against a direct subsidy to its employment costs, no matter how perverse its impact in insulating consumers from the true cost of their health care choices.

Insurers are not brave enough to say: Give us a tax code that lets us go back to being insurers rather than a tax laundromat for the middle class's health-care spending.

* AND THE AMERICAN PEOPLE ARE TOO DAMNED STUPID TO UNDERSTAND THAT "FREE" OR "LOW COST" EMPLOYER PROVIDED HEALTH CARE SERVES NEITHER THE COUNTRY NOR EVEN THEMSELVES IN THE LONG TERM!

* To be continued...

March 23, 2010 at 9:11 PM
William R. Barker said...

* CONTINUING... (Part 2 of 2)

Millions of pages of rules will be written by regulators before we see how it really works. Congress itself will return in predictable ways: It will reverse the proposed Medicare cuts that created ObamaCare's illusion of fiscal probity. It will tighten the mandate that requires insurers to cover the sick at favorable prices. It will not tighten the requirement that the young and healthy buy insurance at prices that subsidize the old and unhealthy.

More and more tax money will have to be found to keep the jalopy on the road. More and more administrative controls on medicine will attempt vainly to keep the jalopy from bankrupting the nation.

Under the law just signed, employers have even more incentive than they did yesterday to lavish excessive health insurance on their high-end employees. They have less incentive to cover low-end workers, or even hire them.

For the young, healthy or anyone not stumbling into a giant tax handout, buying insurance at the inflated prices available in the marketplace would be an even crazier financial decision today than it was yesterday—because now you can wait and buy it when you're sick.

For insurers, the check is in the mail: So watered down is the individual mandate that it must accelerate the industry's death spiral if not for the massive subsidies the government now has obliged itself to provide to keep the industry afloat and allow insurers to continue scalping their 15% off the top for serving as gatekeeper to a tax loophole.

When all is said and done, with unerring accuracy, ObamaCare has ended up doubling down on the system's existing perversities. The one thing it doesn't do (though it would be perfectly consistent with the Democratic goal of universal access) is incentivize a health-care marketplace based on competition in price and quality.

A world-class hospital in India does heart surgery the equal of any heart surgery in America, but does so at one-tenth the cost (and increasingly attracts a world-wide clientele). The reason is not what you think: low-paid doctors and nurses. The reason is that competition works in medicine as it does in everything else when the patient cares about getting value for money. This is the great low-hanging fruit of health-care reform. It continues to hang.

March 23, 2010 at 9:11 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704784904575111900706842356.html?mod=WSJ_Opinion_AboveLEFTTop

We keep reading that we live in the era of deleveraging, when everyone borrows less. But if that's true, there is one great exception: government.

U.S. cities, states and the feds have issued more than $2.5 trillion of new debt since 2008, with another nearly $2 trillion scheduled in 2010.

[N]ow the Obama Administration and Congress are moving to subsidize even more federal and municipal borrowing through a program called Build America Bonds.

[T]hese new bonds aren't tax-exempt but rather carry a direct federal subsidy of one-third of their interest payments. Thus on a bond with a 7% interest rate, the issuing city government pays roughly 4.5% of the interest, and the feds pay 2.5%.

* GUESS WHO "THE FEDS" ARE, KIDS... YEP... YOU GOT IT; THE FEDS ARE US - BY "THE FEDS" WHAT IS MEAN IS FEDERAL TAXPAYERS!

Wall Street firms have pocketed more than $1 billion in fees in less than a year from selling the bonds. Average underwriting fees are $8.20 per $1,000, according to a March 10 Journal story, compared with traditional tax-exempt fees of between $5 and $6 per $1,000. Goldman Sachs, a major Build America Bonds underwriter with some $10 billion in sales, has taken out advertisements urging Congress to make the program bigger and permanent. This is one banker bonus the politicians don't seem to mind.

We aren't surprised that everyone with government connections is happy when Washington pays cities and states to borrow more money. But no one mentions the downside: Build America Bonds will add hundreds of billions of dollars of new liabilities to the balance sheets of cities, states and Uncle Sam.

* ONE MORE TIME... (*GRITTING MY TEETH*)... WE AND OUR CHILDREN AND GRANDCHILDREN ARE RESPONSIBLE FOR PAYING FOR THIS FEDERAL "LARGESS." YOUR TAX DOLLARS ARE PROPPING UP GOLDMAN SACHS EXPANDED PROFITS...!!!

This new subsidized borrowing comes when governments are already buried in debt... States and cities are expected to run deficits of more than $100 billion in each of fiscal years 2010 and 2011. California, which has a $20 billion annual deficit and the worst bond rating of any state at A-minus, issued another $5 billion under the program last year. It was the state's biggest debt offering in history. The New York Metropolitan Transportation Authority, which can barely pay its bills, plans to auction $600 million of the new subsidized bonds soon.

States and cities face $1 trillion to $2 trillion of additional unfunded liabilities in opulent state employee pension and health-care plans. Even as states can't maintain their roads and bridges, politicians have diverted hundreds of billions in tax money to finance salary and pension increases for government workers. Build American Bonds subsidize states and cities so they can avoid a day of reckoning over those benefits.

Build America Bonds are also expanding federal costs much faster than expected. Over the life of the up to 30-year bonds, Uncle Sam could owe up to $90 billion in interest. The program's first-year cost of $1.38 billion already exceeds what the White House estimated it would cost over three years.

March 23, 2010 at 9:25 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052748704896104575140082448673438.html?mod=WSJ_Opinion_LEFTTopOpinion

On Monday the Senate Banking Committee passed the "Restoring American Financial Stability Act of 2010" on a 13-10, party-line vote.

The legislation, drafted by committee chairman Chris Dodd, gives the Federal Reserve power to regulate any large company in America. When considered alongside similar legislation that passed the House of Representatives in December, at least part of the intent of the bills' sponsors becomes clear. The current proposals for "financial" reform are stalking horses allowing government intervention into virtually every facet of the U.S. economy.

The bill that passed the House proposed to create a systemic risk regulator with the power to look into any company in America to determine if it poses a "threat" to the economy. If so, the bill gave the Federal Reserve power to order the company to segregate its financial dealings into a separate business to be regulated as a bank holding company. Remarkably the provision was aimed not just at financial firms like insurers or securities and investment businesses. Under its terms the bill would apply to potentially every large company in America, no matter its primary line of business. ... The Senate bill is even more explicit in giving the Fed power to regulate commercial, non-financial services companies.

Under both bills a company that is deemed to be "financial" can be made subject to special examination and scrutiny by the systemic risk regulator. Whether or not a company is financial comes down to whether the company is engaged in "financial activities," a term that comes from the Bank Holding Company Act of 1956 and includes things like lending money, holding assets of others in trust, investing in securities, trading derivatives, or even leasing real estate and offering certain consulting services. In short "financial activities" are so broadly defined as to include things non financial businesses do everyday like extending credit to customers and holding downpayments on deposit, or even managing a company's own investment portfolio.

[M]any of America's leading manufacturers, retailers and service providers would potentially be roped into the new regulatory scheme. Under Senator Dodd's draft the government's reach is even less restrained: any company "substantially" engaged in financial activities can be made subject to regulation by the Federal Reserve as though it were a bank holding company. For the curious, what is "substantial" is to be determined by the Fed. [T]here is no mystery as to who is being targeted. Under the bill the Fed gets regulatory authority over bank holding companies with greater than $50 billion in assets, and "nonbank financial companies". As the Fed already regulates bank holding companies the new twist is that non-banks become subject to Federal Reserve regulation for the first time.

The list of companies that might find themselves subject to new Federal Reserve regulation is as deep as the U.S. economy itself. An airplane manufacturer that holds customer down payments for future delivery, a large home improvement chain that invests its profits as part of a plan to increase revenues, and an energy firm that makes markets in derivatives are all engaged in "financial activities" and potentially subject to systemic risk regulation. Under the House bill, and even more so under the Dodd legislation, companies that had absolutely nothing to do with the financial crisis of 2008 are finding that they are the object of so-called "financial services reform".

March 23, 2010 at 9:50 PM
William R. Barker said...

http://volokh.com/2010/03/22/is-the-tax-power-infinite/

One source of the impending constitutional challenge to the Obamacare mandate is that exceeds the enumerated powers granted to Congress under Article I, section 8. For example, that the people’s grant to power to Congress to regulate commerce among the several states does not include the power to compel people to engage in commerce.

Does Congress have the infinite power to control people’s behavior (such as by ordering them to engage in commercial transactions) via the tax power? I suggest not. When the Bill of Rights was being debated in front of Congress, the skeptical Rep. Theodore Sedgwick of Massachusetts asked if there should also be an enumeration that “declared that a man should have a right to wear his hat if he pleased; that he might get up when he pleased, and go to bed when he thought proper.” 1 Annals of Congress 759–60 (Aug. 15, 1789). Sedgewick’s point was that national laws about bedtimes and hat-wearing were self-evidently beyond the authority of Congress.

However, if the tax power means that Congress can order citizens to buy something they don’t want to buy, why does Congress not have the power to assess taxes on people who get too little sleep, or too much sleep, and thereby harm their own health and the public fisc? Or who wear hats so little that they increase their risk of skin cancer? Or who wear hats so often that they dangerously reduce their levels of vitamin D?

Construing the tax power as less than infinite – as not encompassing the power to tax bedtimes or the decision not purchase a product – is strongly supported by the Ninth Amendment. This is so whether one agrees with Randy Barnett’s view of the Ninth Amendment (as an enforceable guarantee of natural rights) or with Kurt Lash’s (as a rule that enumerated powers should be narrowly construed so as not to violate natural rights, including the right of self-government in the states).

Americans today are not bound to meekly accept the most far-ranging assertions of congressional power based on large extrapolations from Supreme Court cases that themselves come from a short period (the late 1930s and early 1940s) when the Court was more supine and submissive to claims about centralized power than was any other Supreme Court before or after in our history.

It is eminently within the authority of We the People to act politically on our constitutional beliefs that the congressional power to regulate interstate commerce does not extend to forcing people to buy a product which Congress has forbidden to be sold across state lines; that the power to regulate interstate commerce is not the power to compel a person to participate in instrastate commerce; and the that power to levy income or excise taxes does not include the power to impose punishment in the form of punitive taxes on persons who choose not to buy something – or who choose whether to wear hats and when to sleep.

March 23, 2010 at 9:51 PM
William R. Barker said...

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=528201

Normally the job vacancy rate goes down after a recession, as the job market stabilizes. But January, the latest reported month, showed an 11% spike in unfilled jobs. Vacancies are now at 2.1% — the highest since February 2009, the Labor Department says.

That means people are not taking jobs as expected at this point in the recovery. Why? Because many don't have to — thanks in part to 99 weeks and counting of unemployment benefits.

Add to that record food stamp payments and other welfare, and the unemployed have been perversely incentivized to keep holding out for better jobs, rather than take less-than-desirable or lower-paying ones. Forty percent of jobless Americans have been out of work for at least 27 weeks — the highest level since the government began keeping records in the 1940s.

"Those programs subsidize unemployment," University of Chicago economist Robert Shimer says. "There could be good reasons to do it, but we should be clear on the cost. It has a pretty substantial impact."

Generous jobless benefits alone account for as much as 1.5 points of the nation's 9.7% jobless rate, Shimer reckons.

There are also new incentives for Americans to go on the dole permanently, thanks to a provision in the stimulus package that includes a $5 billion emergency fund for states to meet demand for more welfare assistance.

The administration is expanding that supposedly temporary fund an additional $2.5 billion. The fund matches states 80 cents on the dollar for each new welfare case, making it more generous than the old Aid to Families with Dependent Children (AFDC) system.

In effect, Obama is paying states a bonus to sign up new welfare recipients. This reverses the historic 1996 welfare reform...

New succor doesn't stop there. Socialized medicine threatens to add 15 million uninsured to the Medicaid rolls, which are already bloated from the recession. Working Americans with household income well above the poverty line will be eligible for a program once reserved only for the poor.

Obama is overturning the welfare reform signed by his Democrat predecessor and is rapidly rebuilding the welfare state. If more and more go on the dole instead of filling jobs that are starting to open up, it will only stall the recovery and widen the deficit.

If unemployment "remains elevated for an extended period," it's because Democrats at both ends of Pennsylvania Avenue extended unemployment and welfare benefits while refusing to incentivize small businesses — the job engine of the economy — to take risks and staff up.

March 23, 2010 at 10:42 PM

Post a Comment

Subscribe to: Post Comments (Atom)