Laws, And Facts, Are For Little People

Joe Doakes from Como Park emails:

Senator Franken sent me his newsletter, which included the announcement that he would vote against President Trump’s nominee for Supreme Court.  The reason: the nominee’s ideology favors big business over ordinary Americans.

The press release explains:  “One of Sen. Franken’s main concerns that he said came out of the confirmation hearings is that Judge Gorsuch has a pattern of putting powerful interests, big business, and giant corporations over the safety and rights of average Americans. In one noteworthy ruling, Judge Gorsuch sided with a trucking business over an imperiled driver. In that case, the driver was stuck in below zero weather with frozen brakes and no heat. Forced to choose between freezing to death or driving an unsafe vehicle and risking public safety, he unhitched his trailer and left it behind in order to get warm. And as a result, his company fired him. When Judge Gorsuch ruled on that case, he sided with the trucking company.”

This quote either displays a shocking depth of ignorance about the American legal system, or a disgusting level of contempt for the intellectual abilities of his constituents.  I’m not sure which is worse.

The point of an impartial judiciary is that it does NOT base rulings on the people involved in the case, but on the law as written by the legislative branch of government.  To do it the other way throws us back to feudal times, when people weren’t treated equally under the law because certain favored groups had special privileges.  When the Declaration says “all men are created equal” it doesn’t mean literally equal – obviously we’re not all the same height or wear the same shoe size – it means they’ll be treated as equals for all legal purposes.  We don’t have a nobility that is exempt from the rules. 

If the law says “it’s okay to fire someone who disobeys a lawful order,” and the company gave him a lawful order to stay with the truck, then his decision to abandon the truck was a firing offense and the company was in the right.  What Senator Franken wants the court to do is re-write the law to add a section that the legislature did not include.  He wants the judge to add a section saying “unless the employee has a good reason not to obey the lawful order.” 

That is NOT the judge’s job.  The judge’s job is to say “Based on these facts and this law, this is the result.”  It might be a stupid law and therefore renders a stupid result, but that’s the legislature’s problem to fix.  The judiciary is not a super-legislature.

I will give him this: adopting Franken’s idea would cut down on a lot of litigation.  When the facts and law don’t matter, only the identity of the parties, there’s no need for a trial and witnesses.  If a property management company brought an eviction action against a single mother based on non-payment of rent, the court could immediately dismiss the case and allow her to live there for free, forever, because in Franken’s world, ordinary American trumps business.   If anybody filed a claim against an insurance company for any reason whatsoever, the claimant automatically would win because in Franken’s world, ordinary American trumps business.  Things would get trickier if a Black lesbian single mother sued a left-handed transgendered illegal immigrant because the victim ranking is constantly shifting:  who is the more victimized person and therefore the more worthy winner? 

True, there would be an economic impact as businesses went bankrupt from meritless lawsuits.  But a lot of lawyers would be freed up from litigation to engage in other worthy efforts, perhaps lobbying for stricter environmental regulations to take farmland out of production or stop the importation of oil and natural gas, things that would help save the planet so future generations of Americans could starve in the dark.

Joe Doakes

It’s good to have goals…

Rationality

Joe Doakes from Como Park emails:

I’ve been bewildered that Democrats don’t care about Obamacare and Social Security running in the red. Nobody acts irrationally in their own minds. Whatever they’re doing, it makes sense to them. But how can the government run in the red forever? How will Democrats repay the debt racked up to cover it? What’s their plan?
I figured it out. They have no plan; at least, no plan beyond today. They’re like teenagers looking at the newest iPhone. “I want that, I can afford the monthly payment, I’m buying it.” They know making the minimum monthly payment doesn’t pay down the principal but they assume something will come up, maybe Daddy will give them money for their birthday. As long as the teenager can make the monthly payments, there is no problem so they need no plan.
Now that Democrats are the government, they continue to make the minimum payment on the national debt and raise the debt limit to run up more. They won’t have a problem until the minimum payment required to service the national debt cannot be covered by additional borrowing. And since the government borrows from the people it appoints to print the money (the federal reserve), there is effectively no limit to additional borrowing and therefore no problem, now, or ever.
It’s genius, really. It’s a wonder nobody in history ever thought of that plan before.
Joe Doakes

Some conservatives describe liberal economics as “governing as if unicorns will descend from the heavents to un-screw things”.  And to be honest, the unicorns make more sense.

The Warm Flint, The Cold Baltimore

What’s the only thing worse than politics?

No politics.  Or, rather, no need for politics, since someone is making all the decisions without any need for all that pesky “compromise” and “discussion”.

History is full of the big examples – the USSR, East Germany, Germany itself, Communist China, India under Indira Gandhi, and on and on – places where politics was essentially a one-party exercise in internal spoils division.

The examples come closer to home, of course; places like Baltimore, DC, Newark, Camden, Cleveland, Detroit, Chicago, Oakland, Stockton and Sacramento – all one-party cities where “politics” is a matter of internal Democrat party power utilization.

And of course, there’s California, where even some liberals are figuring it out:

We’re a case study in what a political community looks like when Republicans wield little or no power — and an ongoing refutation of the conceit that but for the GOP, the United States would be free of dysfunction.

Sure, the Golden State gets a lot right. It’s the sixth-largest economy in the world.

But California ranks in the lowest fifth of states in education. Housing costs are out of control. Our major cities face a crisis of homelessness. Our police officers kill citizens at rates comparable to the rest of the country. Our infrastructure is severely overstressed due to underinvestment. The bullet train project meant to connect L.A. to the Bay Area is a national joke. Our counties, cities and schools are being crushed by an unsustainable pension burden. Our taxes are already among the nation’s highest.

And it is no longer plausible to blame any of this on Republicans. For the foreseeable future, Democrats own every Golden State success and failure.

That particular article, written by the LaTimes’ token moderate-lefty (moderate = he hasn’t called for any violent overthrows laterly) Conor Friedersdorf, is mere acknowledgement that California Democrats had best be alert, since they’ve got no other parties to pass the buck to.  Victor Davis Hanson is more forthright.

Closer to home?  Horowitz’s Frontpage says what nobody in Minnesota dares say; Minneapolis is burning, whether you admit it or not.  After “only” forty years of one-party DFL rule (challenged, briefly, from the left by the Green Party in the nineties and early 2000s), Minneapolis’ decay has accelerated with DFL hegemony:

The result has been disastrous. As of 2015, the poverty rate in Minneapolis was 25.3%, nearly twice the 14% statewide rate for Minnesota and the 14.3% rate for the United States as a whole. In 2010, a study of 142 metro areas in Minnesota found that only 15 bore a heavier property-tax burden than Minneapolis, and that was before the city raised its property taxes by 4.7% in 2011.

More recently, Minneapolis property taxes increased by 3.4% in 2016, and by a crippling 5.5% in 2017.

 Notwithstanding the growth in revenues generated by these taxes, the government of Minneapolis has been incapable of balancing its budget. In 2015, for example, the Minneapolis Public Housing Authority’s budget included $84 million in federal subsidies and grants. In 2017, the Metropolitan Council—which describes itself as “the regional policy-making body, planning agency, and provider of essential services for the Twin Cities metropolitan region”—received $91 million in federal funding. That same year, the Minneapolis Public Schools operated with a budget deficit of nearly $17 million.

But massive deficits, coupled with ever-increasing dependency on federal assistance, have done nothing to persuade the political leaders of Minneapolis to question their zealous devotion to leftist political solutions, including an unwavering commitment to the “sanctuary” policies that prevent city employees from assisting federal immigration authorities. When President Donald Trump in 2017 announced that he planned to cut off all federal funding for sanctuary cities, for instance, Minneapolis Mayor Betsy Hodges stated defiantly: “As long as I stand as Mayor, he’s going to have to get through me.”

He probably won’t, though.  Because as Minneapolis’s decay inevitably accelerates, and Betsy Hodges cashes in her sinecure points and moves on to a non-profit that contributes to the problem, the decay and collapse of the city will do what Donald Trump can not.

That Which Can’t Be Sustained, Won’t Be

Joe Doakes from Como Park emails:

Every year for the last 40 years, the United States has run short of money in the budget.  To fill the shortfall, the General Fund borrowed from the Social Security fund, but that still wasn’t enough.  To make ends meet, we borrowed even more.  The total accumulated debt is now $20,000,000,000,000.  That’s twenty trillion, with a T.

 That number does not include the cost of promises the government will be obligated to pay in the future such as Social Security and Medicare, the 20 trillion number is only the total of the promissory notes signed to fund government operations in the past.  Covering the cost of all government promises is closer to 100 trillion, give or take, depending on who you talk to.

 We’re not paying down the debt.  We’re making the minimum monthly payments on existing debt while running up ever more debt, month after month, with no end in sight.

 I don’t care whose fault it is.

 No, I really don’t care whose fault it is.  Finger-pointing and blaming is useless blather, at this point.

 I want to know what we’re going to do about it.

 The reason it comes up is because Republicans in Congress are talking about reforming Obama-care to make it affordable enough that the government can continue to offer the program, but Democrats are screaming the reforms will make the program unaffordable for individual citizens.  Both have fair points.  Both fail to address my point.

 Can government programs run in the red forever?  Can public debt be accumulated forever?  Is there literally no limit to how much debt we can run up?

If so, why?  That’s not true for private individuals or corporations.  If it’s true for government, there must be a reason why it’s true.  What’s the reason?

 Joe Doakes

Let’s ask Paul Krugman.

The Plan

Joe Doakes from Como Park emails:

My boss is a liberal.  “Trump tweeted that he’s breaking his promise, Mexico won’t pay for the wall, we will.”

My response: you’re being distracted from important things by irrelevancies.  Social Security runs out of money in three years. Then what?

His idea: make the federal government repay the money they stole from it.

Seriously?  The reason the federal budget is only short $500 billion each year is that we’re borrowing money from the Social Security fund to cover it.  Where will we get the money to close that gap PLUS repay the IOUs to Social Security?

Simple: the government will just have to come up with the money. And if they don’t have it, then we can’t build the wall. And besides, it’s only temporary, until enough undocumented immigrants arrive to pay into the system again, then it’ll all work out.

Yes.  The liberal plan is to bail out Social Security with [illegal immigants], which is why we must not build the wall, so they can get in, to save us.

Joe Doakes   

Which is, of course, also why we need to raise the minimum wage to $15 an hour; if people make more, they pay more social security taxes.  Hence solvency…

I Have Seen The Future…

“Living Wage” activists carp that without labor, there’d be no business.  To follow that logic, one would assume if you gathered ten drive-through and fry-line workers together, a fast food restaurant would spontaneously form around them.

Less facetiously, we note that a “marxist” restaurant in Grand Rapids, Michigan, which promised “vegan, vegetarian and raw food” and promised no bosses or managers and a “Living wage” for its employees collaborators, has closed.

Worse still, while the food earned Bartertown a spot on VegNews’s “10 Hot New Vegan Restaurants” list, customers complained that it was almost impossible to get a meal at the diner.

People frequently noted on the restaurant’s Facebook page that they waited more than 40 minutes for a sandwich—and that’s when the diner was even open. Because the employees set the shop’s hours by group decision, the restaurant opened and closed at random times, leaving potential sandwich buyers totally confused.

Oh, don’t laugh.  With its minimum wage and sick time ordinances, Minneapolis is about to follow suit.  Saint Paul is rarely far behind.  And the only thing standing in the way of Bloomington following blindly behind would be the Mall of America – the only notable thing in Bloomington – saying “um, no”.

Dodging Bullets

Joe Doakes from Como Park emails:

McDonalds is moving its world headquarters again.  Of course they are. Rich people are rich, not stupid.  Remember John Kerry parking his yacht across the bay to save half-a-million in taxes?  Same idea. 

The crucial point is that McDonald’s, the quintessential American success story, moved to Luxembourg to avoid the punitive taxation of the US, and now has to move to England to avoid the socialism of the EU.  Trump is correct about the need to bring those companies back.  Whether he’s sincere, and whether he can get any cooperation in Congress short term are big questions but not the biggest one. 

If you ran one of those companies, would you let yourself be suckered into trusting Congress again?

Joe Doakes

Congress is going to have to earn a lot of peoples’, and companys’, trust.

If You Have Ice Cream, I Shall Give You Ice Cream; If You Have None, I Shall Take It Away

Joe Doakes from Como Park emails:

Just because you can’t pay your mortgage is no reason not to give you a mortgage.  That was the thinking behind CRA and it caused the housing crisis that tanked the economy for the last 10 years.

 Seeing how well that worked, Social Justice Warriors in Seattle are expanding the plan.  Just because you can’t pay your rent is no reason not to rent to you

 I confidently predict a shortage of rental housing will afflict Seattle within the next five years, and the cause will be a complete mystery.

Coming soon to a local government near you . . . .

Calling Alondra Cano…

Insecurity

Joe Doakes from Como Park emails:

Social Security admits out-go will exceed income in four years and reserves will be exhausted in 2032 meaning the system will go bankrupt, according to this chart:

 image002

 

Congress could increase taxes or cut benefits to keep the system solvent but we all know that’s politically impossible.  Sarah Palin suggested Death Panels to kill off elderly ill but Democrats hated that idea (although if Democrats could stack the committee with IRS employees, they might be able to “investigate” Republican medical treatment candidates long enough until they die while Democrat candidates are whisked right through – the panel idea could become popular with Democrats again using that method).

 The obvious solution is a massive employee die-off so we don’t have to pay Social Security.

 Fortunately, working in an office increases your chance of an early death.  Sitting is as bad as smoking.  So office workers will start dying just about the time the system runs out of money, meaning all is proceeding according to plan if we don’t let the Health and Wellness Nazis screw it up

 Joe Doakes

Not sure who to root for.

Don’t Mess With Texas Entrepreneurs

The city of Austin, Texas essentially ejected Uber and Lyft – the ride-sharing services that have been disrupting the urban transportation model – to protect the local taxi cartel.

Austinians – while continuing to elect the special-interest-sodden Democrat hamsters that have made Austin “the Minneapolis of Texas” – are not amused.

Remember – government regulations are always less about safety than about making sure government controls the graft industry:

Now that Uber and Lyft are gone, Austin—generally thought to be a tech-savvy city—has instead put itself on the map for its ham-fisted governance. The city’s response is only making things worse. Last week it held a job fair for out-of-work Uber and Lyft drivers, at which it encouraged drivers to get fingerprinted and sign up for the only remaining ridesharing company in town, a local app called Get Me…In other words, the city used taxpayer dollars to promote the one private ridesharing company that chose to comply with its onerous regulations.

Austinians are, instead, flocking to “black market” ride-share sources on Facebook and Craigslist.

Where “black market” = “market solutions that serve the actual need”.

Which is pretty revolutionary, isn’t it?

Some Poor Chump Is Always The Last To Get The Word

Joe Doakes from Como Park emails:

The US economy grew in the first quarter of 2016, but only a tiny bit, 0.5%.  That’s technically enough to keep us out of a “recession.”

 First, do you believe that number?  Economic estimates are routinely announced with pronounced spin showing how well the administration’s policies are working, then quietly revised downward a few months later.  There’s not much room to revise this number downward.

 Second, look at the formula for calculating GDP: 

Gross Domestic Product = Consumption + Investment + Government Spending + (Exports – Imports)

 If the federal government wants the GDP number to look good, it can manipulate the result by increasing government spending to offset decreases in Consumption, Investment and Net Exports.  But federal government spending slowed down in the first quarter as Quantitative Easing winds down.  And the GDP number is falling as a result.  The implications are important.

 It means there never was any growth in the Consumer or Investment side of the economy, that’s all been propped up by federal government spending.  In other words, we’ve been experiencing negative economic growth for months, maybe years, but it’s been masked by federal government spending.  I’m looking at you, Barack Obama, and your $20 Trillion national debt.

 The take-away is simple: don’t worry about Great Depression 2.0 coming; it’s already here.  Worry about what happens when the ordinary public figures it out.

 Joe Doakes

Look!  Bathrooms!

Quote Of The Day

Williamson’s Victor Davis Hanson’s 1 piece – on the bureaucracy full of smug, entitled, thirtysomething bureaucrats who have such disporportionate control over this country today – is worth a read from beginning to end.

But this quote was the payoff:

Most men in Dayton or Huntsville do not lounge around in the morning in their pajamas, with or without built-in footpads, drinking hot chocolate and scanning health-insurance policies. That our elites either think they do, or think the few that matter do, explains why a nation $20 trillion in debt envisions the battle over transgender restrooms as if it were Pearl Harbor.

But read it all anyway.

1 Yeah, it’s been that kind of morning.

“Mr. Trump? Call From Hugo Chavez…”

Donald Trump on handling the national debt:

“This is the United States government. First of all, you never have to default because you print the money. I hate to tell you. So there’s never a default. But the point is it was reported in the New York Times incorrectly,” he said, referring to a critical Times article that ran on Friday.

And before you Democrat commenters start giggling too hard?  Bernie Sanders says the same thing – and Hillary doesn’t say it, but practices it anyway.

Appetite For Destruction

Restaurants – I’m talking the high-end, “acclaimed” places that vie for foodie critics’ affirmation – are dropping like, er, flies lately.

At the risk of sounding dramatic, Dara Moskowitz Grumdahl is asking if we’re in the midst of an independent-restaurant massacre in the core of downtown Minneapolis.

Brasserie Zentral. Foreign Legion. Vincent. Masa. Solera. Workshop at Union.

The list of critically acclaimed eateries that have closed up shop in the state’s biggest city continues to grow.

Wonder why that is?

Two years ago, we had Governor Dayton’s sons asking a return of the old “tip credit”, to offset the effect of the hike in the minimum wage.  They are certainly not the only ones hurting.

And I’ve heard – very, very off the record – that as restaurants get big and successful enough, and edge closer and closer to that magic “50 employee” mark, whereupon they are considered big businesses, required to provide Obamacare for their employees, the amount of money it’ll take to actually keep the business running becomes utterly untenable.

In the link above…:

Moskowitz Grumdahl, a senior editor for Mpls.St.Paul Magazine, joined MPR News host Steven John to talk more about what’s behind this trend, how St. Paul is benefiting from it and what downtown Minneapolitans can do about it.

Saint Paul isn’t benefitting.  Restaurants are closing here, too.

Expect to see a DFL proposal to prop up restaurants that are “too tasty to fail”.

If I Did Conspiracy Theories…

…which I don’t, this one would jump out at me.

For most of human history, abortion has been considered one variety of undesirable or another.  Then, two things happened:  First, Margaret Sanger ushered in the idea of using abortion as a Eugenic tool, to control the population of what Sanger and other eugenicists considered undesirable – especially black people.  Second, abortion became a political litmus test on the left.    Result:  African-Americans vote overwhelmingly for a party whose primary civil sacrament is a procedure that has killed tens of millions of them (not to mention a “war on poverty” that has kept them disproportionally poor).

In other words, the left are dedicated to killing black people, and they’ve talked black people into voting for them.

So follow me, here.

For most of human history, the social labor contract has been this: you work hard to learn a skill of sufficient value that someone is willing to pay you to do it (or, similarly, develop the skills to start a business that someone is willing to pay you to patronize), and you earn.  Then, two things happened:  the left developed another civil sacrament, the “Living Wage” – the idea that merely existing entitled one to a wage sufficient (so we’re told) for maintaining a lifestyle.  Second, technology developed the means to cost-effectively supplant workers whose pay was statutorily higher than their value.   It’s nothing new, of course; industrial automation replaced a generation of guys who’d gotten high school diplomas and wandered into union jobs turning wrenches for middle-class incomes.  It happened on the assembly line, it’s going to happen at Burger King.

In other words, the left is dedicated to policies that will make the poor even poorer.  Yet again.

Whew.  It’s a good thing the education system is in such a mess, or people would start to see whats…

…oh.  Right.

Never mind.

(And yet Democrats jabber about places like Kansas and Wisconsin “voting against their interests”.  That’s always worth a laugh).

The Suicide Cult

The quote “democracy can only survive until the majority discovers they can vote themselves largesse from the public treasury” gets attributed to a lot of people; over the years, I’ve seen De Tocqueville and Jefferson, among may others (it’s actually Alexander Tytler).

But what matters at this juncture in history is not so much who said it, or even that it was said.  What matters is that we’ve hit that point.

The “Blue Model” of government – first vote to provide goodies at public expense; then turn them into “entitlements” granted by the force of law that can’t be reasonably undone – holds sway in much of this country (including Minnesota); it’s done so for so long, entire generations think it’s the norm.  Much of the American populace can’t imagine government that isn’t in the entitlement biz; it’s the same part of the populace that seems to think that these “entitlements” are funded by gold coins borne down from heaven on the backs of unicorns (or “taxes on the 1%”, which are about the same thing).

It’s unsustainable.  And that which can not be sustained, won’t be.   The next case?  Illinois:

The Supremes have spoken: The Illinois state constitution is a suicide pact. Less than two years after invalidating an adjustment to state workers’ budget-busting healthcare benefits, the highest court in Illinois has ruled unconstitutional the City of Chicago’s last-ditch efforts to stabilize its woefully underfunded pension system. The Wall Street Journalreports:
The Illinois Supreme Court on Thursday rejected a plan to cut future retirement benefits and boost employee contributions for Chicago city workers, undercutting a pillar of Mayor Rahm Emanuel’s strategy to stabilize one of the nation’s most troubled pension systems.

The justices ruled the changes would violate the rights of city workers and retirees protected under the Illinois constitution. The Emanuel administration had argued that the changes came as part of an agreement under which the city would increase its annual contributions to two of the city’s four pension funds to ensure they remain solvent.”

So to pay for the golden contracts of generations of retired city workers, the City of Chicago is going to have to raise taxes, cut spending on services (like police, fire, and education – and can you imagine an exquisitely expsensive and utterly failed system like the Chicago schools, with less money?) or, most likely, both.   This will drive out established businesses (but for corporate headquarters, of course; CEOs love the urban amenities and are willing to pay the taxes on one building; not the one where the blue and pink-collar proles work, naturally) and inhibit new ones, and worsen the plight of the city’s poor.

It’s called “the Blue Model”.

It’s also called “Detroit, Chapter 1”.

Detroit is in Chapter 4, now.  There is no Chapter 5.

Never Let It Be Said The Left Doesn’t Get Economics

SCENE:  Mitch BERG is getting a cup of coffee.  Aaron ROSTON, a writer at the (possibly fictional) progressive blog “MinnesotaLiberalAlliance.Blogspot.com“, walks up behind him in the line, looking for a free refill.  ROSTON is a crossing guard at a school in rural southern Minnesota, and is a bullying activist – mostly focusing on promoting bullying of children of conservatives.

ROSTON:  Merg! The economy is doing great!  Look at all the new jobs!

BERG:  2/3 of the new jobs are minimum wage.    Times are OK, so far – provided you’re a college educated professional.  If you’re poor, or black, or low-skilled, not so much.

ROSTON:  So it’s time to raise the minimum wage.

BERG:  Raising the minimum wage just rewards some workers by causing others to get laid off.  Prosperity is the only real minimum wage hike.  Here’s the alarming part; the best measure of an economy is how fast people move up and out of the lowest economic quintile.  We used to be among the best in the worlds.  Now, most of the Western world is better than we are.

ROSTON:  Well, funny you should mention that.  Income mobility was pretty good back under the Eisenhower, Kennedy and Johnson Administrations, when the tax rates were much higher.  Hmmmmmmmmm.

BERG:  Wait, what’s with the theatrical “hmmmmmmmm”?

ROSTON:  It proves you have been outfoxed.

BERG:  Well, no.  It’s a false correlation.  In the fifties and sixties, the US had the world’s only functional economy.  Japan and Germany were still recovering from the war; Singapore and South Korea and Taiwan were third-world hellholes; China was an Orwellian  dystopia; India was still at the bottom of its experiment with “democratic socialism”.

The US was the only place where things actually could get built; it was the world’s only functional market.  We could afford high taxes, and cushy union jobs, because we were the only place actually building things.

Correlation doesn’t equal causation.  Ascribing mobility to higher taxes is the same as chalking them up to the fact that “laws against sexual harassment and racism were more lax in the fifties”; they were facts that corresponded in time, but weren’t related.

ROSTON:   What?  You’re a racist!

BERG:  Um, no.  That was an illustration…

ROSTON:  I will not interact with racists and sexists!

(ROSTON winds up and throws his coffee cup toward BERG from a range of three feet.  And misses.  ROSTON stomps away in a huff – grabbing a handful of sugar packets from the credenza on his way out).

BERG: (Sotto voce) Never let it be said that liberals suck at economics.

And SCENE.

The Blind Squirrel

“So let’s get this straight – we have an overwhelming majority of young people supporting a white-haired old man who promises to give them stuff for free.  But I imagine someday they’ll be disappointed when they discover it was really their parents paying for college”.

— Peter Segel, NPR’s “Wait, Wait, Don’t Tell Me” over the weekend.

Almost Like A Sequel To “Trulbert”

Joe Doakes from Como Park emails:

The Federal Reserve was formed in 1913 for one purpose: to give the nation a stable money supply.  That’s it, nothing fancy, just provide a safe, secure, stable supply of money that will hold its value.  We needed that, because the previous national money schemes all went bust and decades of economic chaos followed.

 

After WW II, things looked pretty good and people had forgotten the old lessons.  In the 1970’s, Congress passed the Community Reinvestment Act to force banks to lend to unqualified borrowers and also expanded the Federal Reserve’s mission to include social engineering through monetary policy: “ . . . effectively promote the goals of maximum employment, stable prices, and moderate long-term interest rates . . . .”

 

Remember the recession under Nixon, WIN buttons and the malaise economy of the Carter years?  And the real estate crash we just had?  Social engineering gone awry.

 

The federal government still deficit spends but nobody will buy worthless US bonds so the Federal Reserve buys them with money that it prints up.  I suspect the reason that cash inflow isn’t showing as inflation is the rest of the economy is in deflation but the government changed the formula to hide the fact its borrowing only partly offsets the slow-motion crash.

 

Buyers have a fixed amount of money to spend on monthly house payments.  It doesn’t matter whether that $1,000 per month goes to interest or principal.  The Fed is keeping interest rates low to prop up home values to benefit Baby Boomers wanting to sell McMansions, but it’s killing retirees whose investment accounts earn nothing, cost management fees and are eroded by secret inflation.

 

I suspect the Fed will raise interest rates when more Baby Boomers have retired and need the investment money.  True, it’ll crush home values but retirees won’t care at that point.

 

They tinker with the money hoping to reward certain behavior but if it crashes the economy again – as the other systems did before it – then we’ll be standing around saying “What we need is a safe, secure, stable supply of money that will hold its value.”

 

Joe Doakes

“He who forgets his history…”

Doakes Sunday: Romper Nation

Joe Doakes from Como Park emails:

The gun control debate is a language problem: Liberals don’t speak “Logic,” they speak “Fear.” Or, if you prefer the old terms, “Dialectic” and “Rhetoric.”

Old White men committing suicide are no threat to me, I don’t fear them and don’t care if they have guns. Gang-bangers killing each other in the ghetto are no threat to me, I don’t fear them, let them keep their guns. Policemen shooting Gentle Giants, domestic abusers shooting spouses, children accidentally shooting themselves, none of those are threats to me, I don’t fear them, I don’t care about their guns. I include those deaths in the total of “gun violence” because it makes the problem sound more pressing so I can convince ignorant people to let me solve the problem that really concerns me.

A 20-something White male with mental health issues, inspired to become famous by copying other mass shooters, who has access to guns and to my church, school, shopping mall or movie theatre – that guy’s a threat to me. That guy, I fear. That guy’s guns, I want to take. If the only way to do it is taking everyone else’s guns, well, that’s how we did it in grade school: when one kid farted and nobody would own up to it, the entire class lost our recess privileges. Why expect different behavior from adult Liberals?

Joe Doakes

Collective Guilt is a hallmark of authoritarians and totalitarians everywhere.

Changing Times

Joe Doakes from Como Park emails:

Times change, slogans change.

A Democrat President once said “Ask not what your country can do for you, ask what you can do for your country.”  That’s a Republican way of thinking expressed in the idiom “pull-yourself-up-by-your-own-bootstraps.”

In contrast, Bernie and Hilary believe “From each according to his ability, to each according to his need.”  Democrats are all socialists now, a European way of thinking endorsed by Karl, Josef, Fidel and the most famous National Socialist of all, Adolf.

Cue the liberal who writes in bleating “Naziism wasn’t socialism”.  Oh, go ahead.  Do it.  I’m ready for you.  You’ll lose.

Back to Joe’s email:

I’m curious – if we were to survey history for the last few millennia, which system has been more successful at raising overall prosperity?  Or is that factor no longer relevant, misery now being considered acceptable so long as it’s widely enough shared?

Joe Doakes

It’s not even a question for those paying attention.

So much of our society, of course, isn’t, and never has.

Numbers Are Complicated

Joe Doakes from Como Park emails:

There will be no increase in Social Security in 2016, because there is no inflation.  The government’s official rate of inflation is 0.2%

Except . . . that doesn’t feel right, does it?  The price of gasoline may be holding steady, but nothing else is.  It’s almost as if the government’s official rate is understating inflation.

That’s because it is.  The way they calculate inflation was changed in 1980, and changed again in 1990, always to make things look as if the government is going a wonderful job of keeping prices down, despite what you see at the check-out.

Using today’s method, the rate is 0.2%; using the 1990 method, the rate of inflation is 4%; using the 1980 method, the rate of inflation is 7%.  This isn’t dry economist eye-glazing mumbo-jumbo, this is senior citizens eating dog food because their checks don’t go far enough.

I understand the need to limit spending to keep the system solvent.  The solution isn’t to send seniors to the pet store, it’s to reduce the number of participants in the Ponzi scheme.  Face it: 20-somethings are never going to see Social Security, it’ll collapse long before they get there.  Might as well enact the legislation that says so right now and get them used to the idea of saving for their own future.

Joe Doakes

Except that “saving for their future” is going to get riskier and riskier, if we keep going with the current debt bubble, too.