The Abominable Obamanation

IT WILL BE AN AMERICA where a majority of citizens receive lavish government handouts and benefits but pay no federal income taxes, meanwhile voting themselves still more benefits from the shrinking minority who do pay taxes -- at ever more "progressive" rates

IT WILL BE AN AMERICA where "universal health care" means waiting months, even years, for urgently needed treatment -- unless you happen to be politically powerful or connected -- and where all your private medical information is on a government database (don't worry: they promise never to use it against you!)

IT WILL BE AN AMERICA where "green" ideologues and other nanny-staters dictate what we drive, what we eat, home energy usage, the size of our houses, and even how many children we can have

IT WILL BE AN AMERICA where our major industries, crippled by government mandates, taxes, and regulations, end up becoming taxpayer-supported dinosaurs that can no longer compete in the global marketplace

IT WILL BE AN AMERICA where all employers will be forced to hire and promote not according to ability but according to race, gender, and ethnicity -- all in the name of "diversity"

IT WILL BE AN AMERICA where our once-great centers of finance, industry, culture, and innovation -- from New York to Silicon Valley -- will have gone to seed, while only Washington, D.C., and its environs prosper

IT WILL BE AN AMERICA, in short, where only politicians, government bureaucrats, and their favored constituencies are able to thrive -- and where the only "liberty" that remains is the government's unlimited freedom to control every aspect of your life

[God help us; we're all doomed...unless we can shut down this moron's power. Call Congress and tell them you don't want America destroyed by this affirmative action idiot.]

5/31/2009: Spitting in the eye of mainstream education By Mitchell Landsberg

Reporting from Oakland -- Not many schools in California recruit teachers with language like this:

"We are looking for hard working people who believe in free market capitalism. . . . Multicultural specialists, ultra liberal zealots and college-tainted oppression liberators need not apply."

That, it turns out, is just the beginning of the ways in which American Indian Public Charter and its two sibling schools spit in the eye of mainstream education. These small, no-frills, independent public schools in the hardscrabble flats of Oakland sometimes seem like creations of television's "Colbert Report." They mock liberal orthodoxy with such zeal that it can seem like a parody.

School administrators take pride in their record of frequently firing teachers they consider to be underperforming. Unions are embraced with the same warmth accorded "self-esteem experts, panhandlers, drug dealers and those snapping turtles who refuse to put forth their best effort," to quote the school's website.

Students, almost all poor, wear uniforms and are subject to disciplinary procedures redolent of military school. One local school district official was horrified to learn that a girl was forced to clean the boys' restroom as punishment.

Conservatives, including columnist George Will, adore the American Indian schools, which they see as models of a "new paternalism" that could close the gap between the haves and have-nots in American education. Not surprisingly, many Bay Area liberals have a hard time embracing an educational philosophy that proudly proclaims that it "does not preach or subscribe to the demagoguery of tolerance."

It would be easy to dismiss American Indian as one of the nuttier offshoots of the fast-growing charter school movement, which allows schools to receive public funding but operate outside of day-to-day district oversight. But the schools command attention for one very simple reason: By standard measures, they are among the very best in California.

The Academic Performance Index, the central measuring tool for California schools, rates schools on a scale from zero to 1,000, based on standardized test scores. The state target is an API of 800. The statewide average for middle and high schools is below 750. For schools with mostly low-income students, it is around 650.

The oldest of the American Indian schools, the middle school known simply as American Indian Public Charter School, has an API of 967. Its two siblings -- American Indian Public Charter School II (also a middle school) and American Indian Public High School -- are not far behind.

Among the thousands of public schools in California, only four middle schools and three high schools score higher. None of them serves mostly underprivileged children.

At American Indian, the largest ethnic group is Asian, followed by Latinos and African Americans. Some of the schools' critics contend that high-scoring Asian Americans are driving the test scores, but blacks and Latinos do roughly as well -- in fact, better on some tests.

That makes American Indian a rarity in American education, defying the axiom that poor black and Latino children will lag behind others in school.

First graduates

On Tuesday, American Indian's high school will graduate its first senior class. All 18 students plan to attend college in the fall, 10 at various UC campuses, one at MIT and one at Cornell.

"They really should be the model for public education in the state of California," said Debra England of the Koret Foundation, a Bay Area group that has given more than $100,000 in grants to American Indian. "What I will never understand is why the world is not beating a path to their door to benchmark them, learn from them and replicate what they are doing."

So what are they doing?

The short answer is that American Indian attracts academically motivated students, relentlessly (and unapologetically) teaches to the test, wrings more seat time out of every school day, hires smart young teachers, demands near-perfect attendance, piles on the homework, refuses to promote struggling students to the next grade and keeps discipline so tight that there are no distractions or disruptions. Summer school is required.

Back to basics, squared.

There is no secret to any of this. Portions of the American Indian model resemble methods used by the KIPP charter schools or, for that matter, urban parochial schools.

"What we're doing is so easy," said Ben Chavis, the man who created the school's success and personifies its ethos, especially in its more outrageous manifestations. (One example: He tends to call all nonwhite students, including African Americans, "darkies.") Although he retired in 2007, Chavis remains a presence at the school.

A Lumbee Indian who grew up poor in North Carolina and later struck it rich in real estate, Chavis took over American Indian in 2000, four years after it was founded with a Native American theme.

He began by firing most of the school's staff and shucking the Native American cultural content ("basket weaving," he scoffed). "You think the Jews and the Chinese are dumb enough to ask the public school to teach them their culture?" he asks -- a typical Chavis question, delivered with eyes wide and voice pitched high in comic outrage. There is no basket weaving at American Indian now -- and little else that won't directly affect standardized test scores. "I don't see it as teaching to the test," said Carey Blakely, a former teacher at the school who is writing a book about it. "I see it as, there are certain skills and knowledge that you're supposed to impart to your students, and the test measures whether your students have acquired those skills and that knowledge."

In Lindsay Zika's eighth-grade classroom, the day begins precisely at 8:30, when, without prompting, her students recite the American Indian credo:

"The Family," they chant. "We are a family at AIPHS."

"The Goal: We are always working for academic and social excellence.

"The Faith: We will prosper by focusing and working toward our goals.

"The Journey: We will go forward, continue working and remember we will always be part of the AIPHS family."

They recite this in a slightly robotic monotone. With barely a pause, they shift to the school's mission statement, which is twice as long and includes the promise that American Indian will develop students to be "productive members in a free market capitalist society."

To the test

Another day begins. Zika starts with some comments about a recent history project, "Civil War for Dummies," in which the students wrote primers on the Civil War.

"These are very well done," she tells the class. "They're fabulous to read . . . and they show that you guys understand the Civil War incredibly well."

She moves to spelling. The students, seated in old-fashioned lift-top desks in tight rows, pull out work sheets. Zika selects a shy girl, Alexandria Lai, to lead a drill in which she says a word and others spell it.

Zika is dressed in business attire: black glasses, black skirt, black wool overcoat, her blond hair in a ponytail. She is the quintessential American Indian teacher: young (26), well-educated (Notre Dame, Oxford), self-confident, mature. A product of Oakland Catholic schools, she is warm yet reserved, with an underlying sternness. "I think kids want structure," she says. "They want strict teachers."

By eighth grade, discipline is not really an issue. Classes are preternaturally quiet and focused. Visitors may be startled to notice that students do not so much as glance at them. They have been told to keep their attention on their work. They do as they are told.

Students who misbehave in the slightest must stay for an hour after school; if they misbehave again in the same week, they have more after-school detention plus four hours of Saturday detention.

Under Chavis, the school also relied on humiliation to keep students in line, ridiculing miscreants and sometimes forcing them to wear embarrassing signs. When one boy was caught stealing, Chavis shaved his head in front of the entire school. (The boy, Jeremy Shiv, now a straight-A student at American Indian High, considers what Chavis did "pretty cruel.")

A framed poster in a hallway quotes Chavis: "You do outstanding things here and you'll be treated outstanding. You act like a fool and you'll be treated like one."

That concept isn't dead at American Indian, but it has been toned down.

All American Indian students have 90 minutes of English and 90 minutes of math a day.

The grammar lesson today focuses on appositives, nouns that modify other nouns. Student Isa Bey is asked to write an example on the board.

"The extreme abolitionist John Smith was hung after a brutal revolt," he writes.

Zika smiles. "Historically, there's a problem," she says. "Grammatically, it's correct." Chagrined, Isa erases "Smith" and writes "Brown."

"I like that he's connecting it historically," Zika tells the class, "but let's get it correct."

At 10:05 a.m., the students switch to math. The move takes about 10 seconds.

American Indian's administrators believe that one of the secrets to success in middle school is having one instructor teach all subjects except physical education. The goal is to have that teacher stay with the same children all three years -- a policy that seems to be more theory than reality, given high teacher turnover.

Time saver

The idea is that students will form a deep bond with the teacher and gain class time by having no passing periods. "We really see things in terms of minutes," said principal Janet Roberts, who took over from Chavis.

Five minutes per passing period might not sound like much, but over the course of a year, American Indian saves the equivalent of more than a week's worth of instruction.

Math class begins with a warmup exercise to get students thinking numerically. Then the class goes over the previous night's homework and moves to new material.

All students at American Indian take Algebra 1 in eighth grade, and the school prides itself on its math achievement. Last year, every eighth grader scored "proficient" or better on California's state algebra test. Statewide, only half the eighth graders even took algebra and fewer than half of those scored "proficient" or better.

Today's lesson is Chapter 14: probability.

"What is probability?" Zika begins. "Rebecca?"

"The chance you have of getting something," Rebecca says.

"Yeah," Zika says. "This is an important skill in life."

Zika displays a confidence in math that is rare for someone who majored in political science. "I like teaching math the best," she says.

They move on to factorials, and before long, Zika has the students doing rapid-fire exercises in which she gives them a number and they figure out its factorial on a whiteboard and hold it up for her to see. (A factorial is the product of all positive integers less than or equal to a given number.) The students are generally correct and seem enthralled.

One of the most common questions about charter schools is whether they "cherry pick" the best students and most motivated families.

Charters are required to take all applicants -- or, if they have more students than seats, to hold a lottery. American Indian has never done this and was denied a charter to open a new school last fall in part because school district officials said administrators were "unable to describe" the selection process.

Roberts and Chavis say they have never had more applicants than seats, so they never held a lottery. They also say that they attract a representative sample of students from local elementary schools.

But Ron Smith, the principal of nearby Laurel Elementary, who sent both of his own children to American Indian, says that's not the case for students from his school.

Of those who go from Laurel to American Indian, "I'd say 70% are academically strong, and 30% are a cross-section. . . . They have kids who I know could go anyplace in the state and succeed."

The school could not provide its students' elementary school test scores, so it is hard to say if they were above average. Roberts did provide three years of middle school scores for all students who entered American Indian in 2004 (with names removed for privacy), showing their progress in math and English from sixth to eighth grade. Of the 51 students who entered American Indian's middle school that year, only six scored lower than "proficient" in both math and English at the end of sixth grade.

It's impossible to tell whether the students were academically strong at the start of sixth grade or were brought up to grade level by the rigors of a year at American Indian.

Of the six who scored below "proficient," three left the school and the remaining three showed some progress by the end of eighth grade.

It isn't clear why the students left. American Indian insists that it has never expelled a child but says some leave because their families move or decide the school is a poor fit. Of the 51 students who made it through their first year, 39 finished.

"They've had a reputation among the local public schools as being very interested in kind of recruiting kids who are going to do well, and getting rid of kids who won't," said Betty Olson-Jones, president of the Oakland Education Assn., the teachers union. Both Chavis and Roberts strongly deny this and say their method works with all children. "Give me the worst middle school in America and let us run it," said Chavis. "I guarantee it will improve."

When math ends at 11:40, Zika switches to science. With no lab equipment and an emphasis on textbook learning, it is hard to imagine that American Indian will turn out the next Darwin or Edison. The students have brought in paper towel tubes and, after a discussion of the American space program, Zika leads the class outside, where they have about five minutes for a rare experiment: making rockets. It doesn't go well. With so little time, the experiment more or less fizzles, and then it's lunch. Zika admits it was a mistake; the next day, she'll have the students discuss what went wrong and try again.

After lunch, it's history (Reconstruction and its legacy), and then preparation for a philosophical debate. "Isa, how do you know you're really sitting here? How do you know you're not a brain in a dish hooked up to a machine?" Zika asks.

"I am because I think I am," pipes up Terae Collins, paraphrasing Descartes.

This is as fun as it gets.

At 2:10, the students have P.E. -- running and calisthenics. No games.

The class returns at 2:50 for some last-minute homework instructions. School ends at 3. Most stay and do homework until 4 -- just because they can.

A face appears at the door. It is De-Zhon Grace, a boy who was in Zika's class until Barack Obama was inaugurated as president.

Until then, De-Zhon and his mother had been fairly happy with American Indian. "I'm a single mom, and I'm trying to raise an African American young man, and I'm very serious about his education," said Chaka Grace.

But on Jan. 20, De-Zhon stayed home to watch the inauguration with his extended family. And that crossed a line for Roberts, who believes that nothing -- absolutely nothing -- should get in the way of class. According to De-Zhon's mother, Roberts said the boy would receive extra work as punishment and that she might rescind his recommendation to a private high school.

That, said Grace, "took it to another level for me. . . . I felt that was evil." She pulled her son out of the school.

De-Zhon, a neatly dressed, well-spoken boy who came back for a visit, conceded that he misses American Indian.

"I miss my class; I miss my teacher," he said.

There are no televisions at American Indian -- no computers in the classrooms, either -- so there was no way for students to watch the inauguration. But Roberts wants to be clear: They wouldn't have been allowed to watch it anyway.

"It's not part of our curriculum," she said.

Love it or hate it, it's the American Indian way.

mitchell.landsberg @latimes.com

5/30/2009: Snapshot: The Whole World Sucks, and Everybody Thinks its Gravity
by Fred Reed FredOnEverything.com

I’m going to take poison. Every time I read the headlines, I want to take poison. Always they are a concentrated tale of avarice, wretched judgment, murderousness, and lugubrious taste. I’m thinking potassium cyanide. To sleep, perchance to dream….

Headlines: “Chrysler Heads Back to Bankruptcy Court Friday”; “Crash Diet: GM Getting in Shape for Chapter Eleven”’ “Economy Sinks at a 5.7 Percent Rate in 1Q.”

We’re a Second World country and working on Third, I tell you. We probably won’t be able to make our own cars before long. The economy is croaking. So what we need to do is have a lot of expensive foreign wars. Anybody can see it. You can’t run your own country? Then kill a bunch of thirteenth-century peasants. That’ll fix it.

I think I may have to take over the economy. Yes, I hear you asking, “Fred, what arrogance, even by your vertiginous standards. You aren’t an economist. What makes you think you know anything about economics?”

To which I reply, “What makes you think economists know anything about economics? Who got us into this mess, me or economists? I have never bought anything on credit in my life, and I have zero debt. Would you rather have me running things, or economists?”

Headline: “North Korea Tests Missiles.” Oh good. North Korea has the Bomb and, now, missiles of short range. Short is how long the range is to Seoul and the American bases in South Korea. Bad juju, says my astute military mind. And so Hillary Clinton, former First Housewife turned Millie Metternich and expert on all things foreign, wants sanctions against North Korea. This makes perfect sense. They’ve got nuclear weapons, so let’s piss them off. Sanctions will have no effect on their Bomb, but may make them desperate enough to use it. What could be a better idea?

Remember when George W. Huffenpuff was never going to let the malignant Northerners have the Bomb? No, indeed. He was going to pyong their yang if they even thought about it. That worked, didn’t it? Now President Blackbush is making threatening noises at Korea as if he could do anything about it. He’s going to make those heathen behave, and put the cost on the national credit card with the Bank of China.

Headline: “Army Chief: US Can Fight N. Korea if Necessary.” Yes. General George Casey, Army chief of staff, says we’re ready. In the accompanying photo he has the daft look of a Moonie Boy Scout. I have thought that officers must be issued some form of psychological disturbance when they sign up. Anyway, the US economy is rattling its death rattle, industry either leaves the country or goes tits sunward, America is now the world’s greatest debtor nation, and this dazed silver-haired bull dog wants another war. Why? What’s wrong with the wars we’ve got?

Headline: “Israel Dismisses US Demand on Settlements.” I guess that doesn’t leave much doubt about who controls Washington. Israel, being utterly dependent on the United States for its existence, is the one country that Washington should be able to dictate to. If the US were an independent country, and told the Knesset to wear tutus and toe shoes, in ten minutes they’d be grunting their way through Swan Lake. I don’t know, though. Given how the US manages its own foreign policy, I can see why the Israelis might not be enthusiastic about American suggestions.

Headline: “Senator Lautenberg: US Won’t Be Upset if Israel Strikes Iran.” Well, Senator Lautenberg, presumably an Arab, won’t be upset. But with which Americans has he consulted? Me? I guess I missed his call.

Real answer: He has consulted with Congress, 535 commoditized temple monkeys pawing through the ruins of America in search of bribes. The bicameral whorehouse on Capitol Hill works like a vending machine. You put coins in the slot, select your law, and the desired legislation slides out.

Thing is, Israel can’t attack Iran without an American OK, which Iran knows, so that puts us at war with Iran, and our Iraqi colony shares a long border with Iran, while Israel doesn’t. Something to think about. Should we ever take up thinking.

Headline: “Study: Israeli Attack on Iran Unlikely to Work.” If I were an Israeli, I’d worry about that too. Right now, Iran and Israel are making unpleasant noises at each other, but no more. What if Israel, that least Jewish of countries, attacks but doesn’t kill Iran’s nuclear program? Bombing is an act of war. It would give Iran every moral and legal right to bomb back with anything it had, or might make soon. Kerblooey.

Both America and Israel are accustomed to attacking countries that can’t hit back. There is such a thing as getting too comfortable.

Headline: “White House: Sotomayor Says She Chose Word Poorly.” She is Blackbush’s choice for the Supreme Mausoleum. Court, I meant. Apparently what she said was that a “wise Latina woman” would reach better decisions than “a white male.” Oh. Then why have a Supreme Court at all? We could just replace it with a wise Latina woman. I wonder who she has in mind.

My thought was, oh god, more smug misandry. More man-bashing from an angry brown female who doesn’t know how her car works. I’m happy with Latinos on the Court, or –as, or women or blacks or Jews. But not another wielder of mortal boredom, blathering about white males.

See why cyanide appeals?

Headline: “Pakistani Army Retakes Largest Town in Swat Valley.”

Once more we see the iron claws of the Pentagon digging at the eyeballs of backward countries. Have we no shame? (No.) We want the gas of the Caspian Basin so we invade Afghanistan, yelling and honking about democracy and terror. Next we start murdering Pakistanis from the air with really fun drones, and now we force the Pakis to kill their own people. This is the Southeast Asian paradigm. We killed a million Vietnamese for no particular reason, savaged Laos, brought Pol Pot to power, and then went home to swim at Malibu. Iran, however, is a rogue country.

New headline, just popped up: “Gates: Nuclear Armed North Korea Not Acceptable.” What the hell does that mean? They are nuclear-armed. You either nuke them, invade them, or accept them. Which? Anything any country does is acceptable unless you are prepared and able not to accept it. Fizzing and blowing serves only to advertise impotence.

Headline: “Swine Flu in Ecuador.” I guess that explains why it isn’t in Mexico: It’s somewhere else. For weeks Mexico has been standing on its head to repel the dread epidemic. Schools closed, bars closed, public events were canceled, the government handed out little masks. No flu. I’m thinking of importing a case and charging people to look at it. It would be a bigger draw than a three-headed goat. We have yet to see a case of flu.

I can’t stand it. I’m off to Farmacia Guadalajara for something deadly. There are limits.

5/29/2009: Pravda (4/27/2009):

American capitalism gone with a whimper

[even Pravda sees where we're heading; edited slightly for grammar and spelling]

It must be said, that like the breaking of a great dam, the American decent into Marxism is happening with breathtaking speed, against the back drop of a passive, hapless sheeple, excuse me dear reader, I meant people.

True, the situation has been well-prepared on and off for the past century, especially the past twenty years. The initial testing grounds was conducted upon our Holy Russia and a bloody test it was. But we Russians would not just roll over and give up our freedoms and our souls, no matter how much money Wall Street poured into the fists of the Marxists.

Those lessons were taken and used to properly prepare the American populace for the surrender of their freedoms and souls, to the whims of their elites and betters.

First, the population was dumbed down through a politicized and substandard education system based on pop culture, rather then the classics. Americans know more about their favorite TV dramas than the drama in DC that directly affects their lives. They care more for their "right" to choke down a McDonalds burger or a BurgerKing burger [or to kill their unborn children] than for their constitutional rights. Then they turn around and lecture us about our rights and about our "democracy." Pride blinds the foolish.

Then their faith in God was destroyed, until their churches, all tens of thousands of different "branches and denominations" were, for the most part, little more then Sunday circuses, and their televangelists and top protestant mega preachers were more then happy to sell out their souls and flocks to be on the "winning" side of one pseudo Marxist politician or another. Their flocks may complain, but when [it was] explained that they would be on the "winning" side, their flocks were ever so quick to reject Christ in hopes for earthly power. Even our Holy Orthodox churches are scandalously liberalized in America.

The final collapse has come with the election of Barack Obama. His speed in the past three months has been truly impressive. His spending and money printing has been a record setting, not just in America's short history but in the world. If this keeps up for more then another year, and there is no sign that it will not, America at best will resemble the Wiemar Republic and at worst Zimbabwe.

These past two weeks have been the most breath taking of all. First came the announcement of a planned redesign of the American Byzantine tax system, by the very thieves who used it to bankroll their thefts, loses and swindles of hundreds of billions of dollars. These make our Russian oligarchs look little more then ordinary street thugs, in comparison. Yes, the Americans have beat our own thieves in the shear volumes. Should we congratulate them?

These men, of course, are not an elected panel but made up of appointees picked from the very financial oligarchs and their henchmen who are now gorging themselves on trillions of American dollars, in one bailout after another. They are also usurping the rights, duties and powers of the American congress (parliament). Again, congress has put up little more then a whimper to their masters.

Then came Barack Obama's command that GM's (General Motor) president step down from leadership of his company. That is correct, dear reader, in the land of "pure" free markets, the American president now has the power, the self given power, to fire CEOs and we can assume other employees of private companies, at will. Come hither, go dither, the centurion commands his minions.

So it should be no surprise, that the American president has followed this up with a "bold" move of declaring that he and another group of unelected, chosen stooges will now redesign the entire automotive industry and will even be the guarantor of automobile policies. I am sure that if given the chance, they would happily try and redesign it for the whole of the world, too. Prime Minister Putin, less then two months ago, warned Obama and UK's Blair, not to follow the path to Marxism, it only leads to disaster. Apparently, even though we suffered 70 years of this Western sponsored horror show, we know nothing, as foolish, drunken Russians, so let our "wise" Anglo-Saxon fools find out the folly of their own pride.

Again, the American public has taken this with barely a whimper...but a "freeman" whimper.

So, should it be any surprise to discover that the Democratically controlled Congress of America is working on passing a new regulation that would give the American Treasury department the power to set "fair" maximum salaries, evaluate performance and control how private companies give out pay raises and bonuses? Senator Barney Franks, a social pervert basking in his homosexuality (of course, amongst the modern, enlightened American societal norm, as well as that of the general West, homosexuality is not only not a looked down upon life choice, but is often praised as a virtue) and his Marxist enlightenment, has led this effort. He stresses that this only affects companies that receive government monies, but it is retroactive and taken to a logical extreme, this would include any company or industry that has ever received a tax break or incentive.

The Russian owners of American companies and industries should look thoughtfully at this and the option of closing their facilities down and fleeing the land of the Red as fast as possible. In other words, divest while there is still value left.

The proud American will go down into his slavery with out a fight, beating his chest and proclaiming to the world, how free he really is. The world will only snicker.

Stanislav Mishin

5/27/2009: from the Daily Reckoning

The US Treasury market is in a bubble. Like all bubbles, it will pop. And as always, when bubbles pop, there are those who get hurt - and those who profit. The difference is how well you're prepared for it.

On the numbers, the US government is the worst credit risk in the world. You determine a man's creditworthiness by looking at his balance sheet. Add up his assets and subtract his liabilities. Do that to the federal government and you get a very big number with a minus sign in front of it. Even if they were to sell off the Capitol building and all the federal lands west of the Mississippi, the feds would still have a hole in their finances larger than any other in the entire world [the combined unfunded liability of the Social Security and Medicare "Trust Funds" (i.e., the excess of promises already made over future funding under current law) is now $100,000,000,000,000 (that's one hundred trillion dollars, 14 zeros)].

While the balance sheet looks awful, the cash flow is worse. In the current year, the feds will take in about $1.9 trillion in taxes and spend $3.6 trillion. In other words, the feds aren't just living beyond their means...they're not even on the same planet. Who in his right mind would lend to a spendthrift whose outgo exceeded his income by nearly 100%?

The only way any loan can reasonably be repaid is from income. Income must exceed expenses or there will never be money for debt repayment. Lending to a corporation or an individual, the lender expects the borrower to earn his way out of debt. Otherwise, it's a fool's game. The debtor is soon kiting checks and going deeper in the hole. He borrows from one lender in order to pay off the first lender... In effect, he operates a pyramid scheme - depending on fresh suckers to keep giving him new money - until the whole thing comes crashing down.

The federal government doesn't even pretend that it is going to earn its way out of debt. It presumes that there's an endless supply of money it can borrow...and new suckers born twice a minute who are willing to lend. But this is exactly where all Ponzi schemes crack up. The fed's pyramid will fall in the same spot; where it runs out of new money.

Mr. Obama says he plans on cutting the budget deficit in half by the end of his term. Let's see...that's four years out. If he's true to his word, that will mean deficits averaging about $1.5 trillion a year...or about $6 trillion total. Where will that money come from? What sucker has that kind of cash?

...

"The Brazilian real overtook the South African rand today as the world's best-performing currency. Brazil posted a $146 million current account surplus in April, its government announced yesterday, the first such surplus since September 2007. Brazil's government has introduced aggressive new tax cuts and new trade agreements (mostly with China), and has thus become the darling of the currency trade. Low taxes, open trade and account surplus is good for a nation's economy? Huh... Who'd have thought?

...

There are about $1,600 trillion worth of derivatives in the world...$125 trillion worth of real estate and business assets...$100 trillion worth of stocks and bonds secured by assets...$65 trillion worth of government bonds (rising rapidly)...$4 trillion worth of actual currency...and only between $2 and $4 trillion worth of gold and silver [one might note that the completely funding the liabilities of Social Security and Medicare would require all of the stocks and secured bonds in the world...feel comfortable that you'll get those monthly checks when you retire? how about if we implement universal government paid health care?].

We'll take the gold and silver...at least until the bubble in Treasury debt blows up.

Is the Obama administration turning Chrysler into a patronage machine?

A tipster alerted me to an interesting assertion. A cursory review by that person showed that many of the Chrysler dealers on the closing list were heavy Republican donors.

To quickly review the situation, I took all dealer owners whose names appeared more than once in the list. And, of those who contributed to political campaigns, every single one had donated almost exclusively to GOP candidates. While this isn't an exhaustive review, it does have some ominous implications if it can be verified.

However, I also found additional research online at Scribd (author unknown), which also appears to point to a highly partisan decision-making process. . . .

I have thus far found only a single Obama donor (and a minor one at that: $200 from Jeffrey Hunter of Waco, Texas) on the closing list.

5/26/2009: Obama picks racist feminist liberal, Sonia Sotomayor, for Supreme Court

Judge Sonia Sotomayor: ...in 2005: “All of the legal defense funds out there they're looking for people with court of appeals experience because it is...court of appeals is where policy is made." [emphasis added] She tried to backtrack... [Duke University Law School 1995]

Video: http://www.youtube.com/watch?v=OfC99LrrM2Q

AP sources: Obama picks Sotomayor for high court

Sotomayor: "I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male..."

“Whether born from experience or inherent physiological or cultural differences,” she said later, regarding non-white, female judges, “our gender and national origins may and will make a difference in our judging.”

[Once again, we see that white males are the lowest of the low. She hurt my feelings; where is the empathy? My self-esteem suffers; I am so depressed... Perhaps I should sue someone.]

...In one of Sotomayor's most notable decisions, as an appellate judge she sided last year with the city of New Haven, Conn., in a discrimination case brought by white firefighters. The city threw out results of a promotion exam because too few minorities scored high enough [actually none scored high enough]. Ironically, that case is now before the Supreme Court.

...At her Senate confirmation hearing more than a decade ago, she said, "I don't believe we should bend the Constitution under any circumstance. It says what it says. We should do honor to it." [promising if she really means it...but her other comments and her record shows that those are merely words]

...Wendy Long of the Judicial Confirmation Network, issued a statement calling Sotomayor a "liberal judicial activist of the first order who thinks her own personal political agenda is more important that the law as written."

Yet another decision by Sotomayor: The case involved about as naked an abuse of government power as could be imagined. Bart Didden came up with an idea to build a pharmacy on land he owned [note that he already owned the land] in a redevelopment district in Port Chester over which the town of Port Chester had given Greg Wasser control. Wasser told Didden that he would approve the project only if Didden paid him $800,000 or gave him a partnership interest [sounds like extortion to me]. The "or else" was that the land would be promptly condemned by the village, and Wasser would put up a pharmacy himself. Just that came to pass. But the Second Circuit panel on which Sotomayor sat did not raise an eyebrow. Its entire analysis reads as follows: "We agree with the district court that [Wasser's] voluntary attempt to resolve appellants' demands was neither an unconstitutional exaction in the form of extortion nor an equal protection violation." [Forbes.com]:

The Case Against Sotomayor by Jeffrey Rosen
Indictments of Obama's front-runner to replace Souter.

A judge on the U.S. Court of Appeals for the Second Circuit, Sonia Sotomayor's biography is so compelling that many view her as the presumptive front-runner for Obama's first Supreme Court appointment. She grew up in the South Bronx, the daughter of Puerto Rican parents. Her father, a manual laborer who never attended high school, died a year after she was diagnosed with diabetes at the age of eight. She was raised by her mother, a nurse, and went to Princeton and then Yale Law School. She worked as a New York assistant district attorney and commercial litigator before Senator Daniel Patrick Moynihan recommended her as a district court nominee to the first President Bush. She would be the first Hispanic Supreme Court justice, if you don't count Benjamin Cardozo. (She went to Catholic schools and would also be the sixth Catholic justice on the current Supreme Court if she is, in fact, Catholic, which isn't clear from her official biography.) And she has powerful supporters: Last month, the two senators from New York wrote to President Obama in a burst of demographic enthusiasm, urging him to appoint Sotomayor or Ken Salazar.

Sotomayor's former clerks sing her praises as a demanding but thoughtful boss whose personal experiences have given her a commitment to legal fairness. "She is a rule-bound pragmatist--very geared toward determining what the right answer is and what the law dictates, but her general approach is, unsurprisingly, influenced by her unique background," says one former clerk. "She grew up in a situation of disadvantage, and was able, by virtue of the system operating in such a fair way, to accomplish what she did. I think she sees the law as an instrument that can accomplish the same thing for other people, a system that, if administered fairly, can give everyone the fair break they deserve, regardless of who they are."

Her former clerks report that because Sotomayor is divorced and has no children, her clerks become like her extended family--working late with her, visiting her apartment once a month for card games (where she remembers their favorite drinks), and taking a field trip together to the premier of a Harry Potter movie.

But despite the praise from some of her former clerks, and warm words from some of her Second Circuit colleagues, there are also many reservations about Sotomayor. Over the past few weeks, I've been talking to a range of people who have worked with her, nearly all of them former law clerks for other judges on the Second Circuit or former federal prosecutors in New York. Most are Democrats and all of them want President Obama to appoint a judicial star of the highest intellectual caliber who has the potential to change the direction of the court. Nearly all of them acknowledged that Sotomayor is a presumptive front-runner, but nearly none of them raved about her. They expressed questions about her temperament, her judicial craftsmanship, and most of all, her ability to provide an intellectual counterweight to the conservative justices, as well as a clear liberal alternative.

The most consistent concern was that Sotomayor, although an able lawyer, was "not that smart and kind of a bully on the bench," as one former Second Circuit clerk for another judge put it. "She has an inflated opinion of herself, and is domineering during oral arguments, but her questions aren't penetrating and don't get to the heart of the issue." (During one argument, an elderly judicial colleague is said to have leaned over and said, "Will you please stop talking and let them talk?") Second Circuit judge Jose Cabranes, who would later become her colleague, put this point more charitably in a 1995 interview with The New York Times: "She is not intimidated or overwhelmed by the eminence or power or prestige of any party, or indeed of the media."

Her opinions, although competent, are viewed by former prosecutors as not especially clean or tight, and sometimes miss the forest for the trees. It's customary, for example, for Second Circuit judges to circulate their draft opinions to invite a robust exchange of views. Sotomayor, several former clerks complained, rankled her colleagues by sending long memos that didn't distinguish between substantive and trivial points, with petty editing suggestions--fixing typos and the like--rather than focusing on the core analytical issues.

Some former clerks and prosecutors expressed concerns about her command of technical legal details: In 2001, for example, a conservative colleague, Ralph Winter, included an unusual footnote in a case suggesting that an earlier opinion by Sotomayor might have inadvertently misstated the law in a way that misled litigants. The most controversial case in which Sotomayor participated is Ricci v. DeStefano, the explosive case involving affirmative action in the New Haven fire department, which is now being reviewed by the Supreme Court. A panel including Sotomayor ruled against the firefighters in a perfunctory unpublished opinion. This provoked Judge Cabranes, a fellow Clinton appointee, to object to the panel's opinion that contained "no reference whatsoever to the constitutional issues at the core of this case." (The extent of Sotomayor's involvement in the opinion itself is not publicly known.)

Not all the former clerks for other judges I talked to were skeptical about Sotomayor. "I know the word on the street is that she's not the brainiest of people, but I didn't have that experience," said one former clerk for another judge. "She's an incredibly impressive person, she's not shy or apologetic about who she is, and that's great." This supporter praised Sotomayor for not being a wilting violet. "She commands attention, she's clearly in charge, she speaks her mind, she's funny, she's voluble, and she has ownership over the role in a very positive way," she said. "She's a fine Second Circuit judge--maybe not the smartest ever, but how often are Supreme Court nominees the smartest ever?"

I haven't read enough of Sotomayor's opinions to have a confident sense of them, nor have I talked to enough of Sotomayor's detractors and supporters, to get a fully balanced picture of her strengths. It's possible that the former clerks and former prosecutors I talked to have an incomplete picture of her abilities. But they're not motivated by sour grapes or by ideological disagreement--they'd like the most intellectually powerful and politically effective liberal justice possible. And they think that Sotomayor, although personally and professionally impressive, may not meet that demanding standard. Given the stakes, the president should obviously satisfy himself that he has a complete picture before taking a gamble.

Jeffrey Rosen is the legal affairs editor at The New Republic.

Inflation in One Page By Henry Hazlitt
Cause and Cure of Inflation

1. Inflation is an increase in the quantity of money and credit. Its chief consequence is soaring prices. Therefore inflation—if we misuse the term to mean the rising prices themselves—is caused solely by printing more money. For this the government’s monetary policies are entirely responsible.

2. The most frequent reason for printing more money is the existence of an unbalanced budget. Unbalanced budgets are caused by extravagant expenditures which the government is unwilling or unable to pay for by raising corresponding tax revenues. The excessive expen­ditures are mainly the result of government efforts to redistribute wealth and income—in short, to force the productive to support the unproductive. This erodes the working incentives of both the productive and the unpro­ductive.

3. The causes of inflation are not, as so often said, "multiple and complex," but simply the result of printing too much money. There is no such thing as "cost-push" inflation. If, without an increase in the stock of money, wage or other costs are forced up, and producers try to pass these costs along by raising their selling prices, most of them will merely sell fewer goods. The result will be reduced output and loss of jobs. Higher costs can only be passed along in higher selling prices when consumers have more money to pay the higher prices.

4. Price controls cannot stop or slow down inflation. They always do harm. Price controls simply squeeze or wipe out profit margins, disrupt production, and lead to bottlenecks and shortages. All government price and wage control, or even "monitoring," is merely an attempt by the politicians to shift the blame for inflation on to producers and sellers instead of their own monetary policies.

5. Prolonged inflation never "stimulates" the economy. On the contrary, it unbalances, disrupts, and misdirects production and employment. Unemployment is mainly caused by excessive wage rates in some industries, brought about either by extortionate union demands, by minimum wage laws (which keep teenagers and the unskilled out of jobs), or by prolonged and over-generous unemployment insurance.

6. To avoid irreparable damage, the budget must be balanced at the earliest possible moment, and not in some sweet by-and-by. Balance must be brought about by slashing reckless spending, and not by increasing a tax burden that is already undermining incentives and pro­duction.

5/26/2009: Obama and the 'South Park' Gnomes by Bret Stephens
Too many initiatives that require a leap of faith.

Sometimes it takes "South Park" to explain life's deeper mysteries. Like the logic of the Obama administration's policy proposals.

Consider the 1998 "Gnomes" episode -- possibly surpassing Milton Friedman's "Free to Choose" as the classic defense of capitalism -- in which the children of South Park, Colo., get a lesson in how not to run an enterprise from mysterious little men who go about stealing undergarments from the unsuspecting and collecting them in a huge underground storehouse.

What's the big idea? The gnomes explain:

"Phase One: Collect underpants.

"Phase Two: ?

"Phase Three: Profit."

Lest you think there's a step missing here, that's the whole point. ("What about Phase Two?" asks one of the kids. "Well," answers a gnome, "Phase Three is profits!") This more or less sums up Mr. Obama's speech last week on Guantanamo, in which the president explained how he intended to dispose of the remaining detainees after both houses of Congress voted overwhelmingly against bringing them to the U.S.

The president's plan can briefly be described as follows. Phase One: Order Guantanamo closed. Phase Two: ? Phase Three: Close Gitmo!

Granted, this is an abbreviated exegesis of his speech, which did explain how some two-thirds of the detainees will be tried by military commissions or civilian courts, or repatriated to other countries. But on the central question of the 100-odd detainees who can neither be tried in court nor released one searches in vain for an explanation of exactly what the president intends to do.

Now take the administration's approach to the Middle East. Phase One: Talk to Iran, Syria, whoever. Phase Two: ? Phase Three: Peace!

In this case, the administration seems to think that diplomacy, like aspirin, is something you take two of in the morning to take away the pain. But as Boston University's Angelo Codevilla notes in his book, "Advice to War Presidents," diplomacy "can neither create nor change basic intentions, interests, or convictions. . . . To say, 'We've got a problem. Let's try diplomacy, let's sit down and talk' abstracts from the important questions: What will you say? And why should anything you say lead anyone to accommodate you?"

Ditto for Mr. Obama's approach to nuclear weapons. In a speech last month in Prague, right after North Korea had illegally tested a ballistic missile, Mr. Obama promised a new nonproliferation regime, along with "a structure in place that ensures when any nation [breaks the rules], they will face consequences." Whereupon the U.N. Security Council promptly failed to muster the votes for a resolution condemning Pyongyang's launch.

Now Kim Jong Il has tested another nuke, and we're back at the familiar three-step. Phase One: Propose a "structure." . . .

It was also in his Prague speech that Mr. Obama repeated his pledge to "confront climate change by ending the world's dependence on fossil fuels, by tapping the power of new sources of energy like the wind and sun."

Never mind that neither the wind nor the sun are new sources of energy. It so happens that the U.S. gets about 2.3% of its energy resources from "renewable" resources of the kind the president advocates while fossil fuels account for about 70%. The reason for this, alas, has nothing to do with the greed of the oil majors. But it has much to do with something known as "energy density": Crude oil has almost three times as much of it as switchgrass, supposedly the Holy Grail of our green future. A related problem is that heat invariably dissipates, meaning that it will always be difficult to turn diffuse sources of energy, like wind, into concentrated ones.

In Gnome-speak, then, Mr. Obama's energy policy goes something like this: Phase One: Inaugurate the era of "green" energy. Phase Two: Overturn the first and second laws of thermodynamics. Phase Three: Carbon neutrality!

Take any number of Mr. Obama's other initiatives. Rescue Detroit? Phase One: Set a national mileage standard for passenger cars of 39 miles per gallon and force auto makers to make the kind of cars that drove them to bankruptcy in the first place.

Reduce the deficit? Phase One: Approve $3.5 trillion in government stimulus, and then await the mythical Keynesian multiplier.

Pay for a $1.2 trillion health-care reform? Phase One: scrounge around for about $60 billion in new "sin tax" revenue.

Actually, we can easily guess how Mr. Obama intends to make up the difference on this last item: To wit, by taxing health benefits. Taxes, subsidies funded by taxes, regulations and mandates will also fill in many (though not all) of the other blanks. Underpants gnomes: meet Phase Two. Say, what happened to profits?

Write to bstephens@wsj.com

5/25/2009: A Fast Way to Lose the Arms Race by John Bolton

Washington

PRESIDENT OBAMA has called for a world without nuclear weapons, not as a distant goal, but as something imminently achievable. Secretary of State Hillary Clinton followed up, saying that American and Russian “leadership” in arms control and nonproliferation was “at the top of the list” of her priorities. Although the administration may be counting on the eyelid-lowering effect of arms-control terminology to minimize Congressional and public scrutiny, its plans are deeply troubling for America.

First, the administration’s bilateral objectives with Russia play almost entirely to Moscow’s advantage, as in arms-control days of yore. Hurrying to negotiate a successor to the second Strategic Arms Reduction Treaty by year’s end, which Secretary Clinton has committed to, reflects a “zeal for the deal” approach that benefits only Russia.

We need not be rushed, since simply extending the existing treaty’s verification provisions would preserve the status quo. Fortunately, Russia seems likely to save us from the dangerously low warhead levels proposed by Senator John Kerry and others, but the risks of foolish, unnecessary concessions remain high.

Paradoxically, the administration itself might put the entire negotiating process into gridlock by reaching much farther than the Russians are willing to go, such as by trying to negotiate numerical limits on tactical nuclear weapons. More seriously, the administration has pre-emptively conceded to Russia on strategic defensive issues: first by linking the general subject of missile defense with offensive issues, long a Russian goal; and secondly by signaling that specific projects, like the defense system intended for Poland and the Czech Republic, might be abandoned or bargained away.

Second, the Obama administration is seriously weakening both our strategic offensive and defensive capacity. The Defense Department budget proposes major cuts in missile defense programs, returning to an emphasis both in operational and diplomatic terms on “theater” missile defense (mainly for defending deployed military forces), rather than “national” missile defense (for shielding America’s population from missile attack). Protecting our forces abroad must remain a top priority, but it need not be at the expense of homeland defense. President Ronald Reagan refused to bargain on missile defense, and President Obama isn’t bargaining either. He is simply giving it away.

The Pentagon also proposes ending financing for the Reliable Replacement Warhead, a key to substituting safe, dependable warheads for the ones now aging. For the last two years, Congress refused President George W. Bush’s requests to pay for the program, but dropping it from the Obama budget altogether is another diplomatic freebie for Moscow. Even worse, in his public statements, President Obama’s seeming indifference to the beneficent effects of the United States’ nuclear deterrent has to worry our friends and allies, most notably Japan.

Third, the president is resurrecting President Bill Clinton’s unfinished multilateral arms-control agenda, committing, for example, to ratify the Comprehensive Test Ban Treaty, which would effectively make permanent the current moratorium on underground testing. Vice President Joe Biden is leading the administration’s effort to reverse the Senate’s 1999 rejection of the test-ban treaty, the first major treaty to fail on the Senate floor since the Treaty of Versailles after World War I.

The administration is also putting new emphasis on negotiating conventions against the “arms race” in outer space, which would undercut America’s current substantial advantage above the earth, and on resuscitating a proposed treaty that would prohibit the production of uranium and plutonium for weapons.

Unhappily, the administration is pushing Israel to sign the Nuclear Nonproliferation Treaty as a “non-nuclear-weapons state,” meaning Israel would have to eliminate its nuclear arsenal. Iran and others will welcome this, given their repeated demands for the same result. Today’s real proliferation threat, however, is not Israel, but states like Iran and North Korea that become parties to the alphabet soup of arms control treaties and then violate them with abandon. Without robust American reactions to these violations — not apparent in administration thinking — more will follow.

The Senate, which must approve any treaty with a two-thirds supermajority, is now the only obstacle to Obama administration policies that will seriously weaken the United States. Voters should remind their representatives on Capitol Hill that they have a responsibility to keep us safe.

John R. Bolton, the United States ambassador to the United Nations from 2005 to 2006, is a senior fellow at the American Enterprise Institute and the author of “Surrender Is Not an Option.”

5/26/2009: Business and the Supreme Court By Bernie Marcus
Washington's grab for power makes Obama's pick crucial for contracts.

Soon after David Souter announced his plans to retire from the Supreme Court, pundits began predicting that it would have little impact on the court's future. According to ABC News, an Obama replacement "would be unlikely to tip the balance of the court." The Los Angeles Times echoed, "Souter's retirement is not likely to change the court's ideological balance."

Can we be so sure? Justice Souter frequently signed onto 5-4 majority opinions ensuring the fair, just and efficient resolution of legal disputes for entrepreneurs and business owners. In the areas of tort liability, antitrust law, class actions, shareholder liability and labor standards, Justice Souter has what many lawyers describe as a moderate or restrained record -- one which plaintiffs lawyers, unions and antimarket ideologues would hope to avoid in a replacement.

The assault on our system of free enterprise that is now taking place in our nation's Capitol may well result in a case before the Supreme Court. Politicians in Washington are using the current economic crisis to cram through a series of policies that increase the power and size of government without regard to the sound checks and balances our Constitution's Framers put in place. This deeply concerns me, because free enterprise and the certainty provided by the rule of law made America the most prosperous and generous nation in the world. Now this is in jeopardy. I cannot think of anything more detrimental to the future of free enterprise than turning bankruptcy proceedings on their head as has happened with Chrysler.

Banks and other financial institutions were willing to loan money over the years to a troubled company like Chrysler because their loans were secured by the auto company's assets, and because these lenders would be first in line in the event of a bankruptcy. But in the Chrysler bankruptcy unsecured creditors were effectively put ahead of secured creditors.

The biggest beneficiaries are Chrysler's union employees. Let's not forget that the union -- which demanded and won uncompetitive work rules, pay and benefits -- is just as responsible for the company's failure as are its shortsighted executives. Yet according to reports, a union trust fund will own 55% of the auto maker, as well as receive from the company a $4.9 billion promissory note and a boatload of cash after it emerges from bankruptcy.

What lender today would loan money to a company without the certainty of a secured position in the company's assets? A company may seem healthy today, as Chrysler once did, but without the certainty of the rule of law in bankruptcy proceedings, capital for business will either dry up or be prohibitively expensive.

I started as a small business owner in Atlanta, and my business grew into a national company with more than 300,000 employees. Without access to capital, none of this would have happened and no one would have heard of Home Depot. Cutting off access to capital would leave the federal government as the lender of first and last resort. Does anyone think this is good for America? Although I am retired from Home Depot and not involved in business today, I remain committed to our free-enterprise system.

There are also threats to the rule of law in the "Employee Free Choice Act" pending in Congress. If a company and its newly organized employees are unable to agree to contract terms, an arbitrator appointed by the federal government would set the work rules, pay, benefits and other terms for at least two years. Couple this with the Treasury Department effectively firing the CEO of General Motors and telling Chrysler how much it can spend on advertising and the situation does not look good for free enterprise.

Will President Barack Obama and the Senate show a strong commitment to the rule of law in selecting and confirming a Supreme Court Justice? On multiple occasions -- from his floor statement on his vote against Chief Justice John Roberts to his announcement of Justice Souter's retirement -- the president has reiterated that it is appropriate to select judges who will decide cases based on "empathy" -- that is to say, personal experiences, feelings and political views.

Such a standard ignores a judge's legitimate role as neutral umpire who rules on the basis of what the law is rather than what he thinks it should be. It is a recipe for disaster if we hope to have a legal climate that ensures the kind of fundamental fairness and predictability that attracts capital to build businesses and create jobs.

Entrepreneurs and business owners -- indeed, every American who cares about our economic future -- should give this Supreme Court vacancy careful attention. The Senate must have a full and fair hearing of the president's nominee as a first step toward ensuring our legal system continues to support a key pillar of the free market -- the fair administration of justice for all.

Mr. Marcus is the retired co-founder of The Home Depot.

5/26/2009: 20 Hypocrisies Of Liberalism by John Hawkins

Everybody is guilty of being hypocritical sometimes. It’s just part of being human; however, modern liberalism has taken this concept to stunning extremes. The entire liberal belief system, from top to bottom, is a series of logical blind alleys, bottlenecks, and jaw-dropping contradictions.

To be a politically active liberal is to a be a person whose life is steeped in hypocrisy from the time he gets up until the time he goes to bed -- and that's despite the fact that many libs take morally abhorrent positions just so they can't be called hypocrites if they ever get caught doing something degenerate.

That being said, I will freely acknowledge that every liberal isn't guilty of all the hypocrisies that are on this list and that conservatives can be contradictory, too. Now, let's see if that actually prompts some self-reflection on the Left as opposed to cries of "Here's something conservatives are hypocritical about" and "I don't believe this one." (Sure it will. ha! ha! ha!)

Liberals believe that...

1) ...it's impossible to come to any sort of reasonable compromise with conservatives on anything, but that we can fix our problems with nations like Iran and North Korea by just sitting down and talking things out.

2) ...they're the most compassionate people in society. Yet, in study after study, you find that conservatives give more of their money to charity than liberals.

3) ...they're not racist despite the fact that they consistently support policies that have been several orders of magnitude more devastating to black Americans than the Ku Klux Klan.

4) ...we've all got to dramatically reduce our carbon footprint to save the planet. Yet, liberals like Al Gore live in big mansions and fly around in private jets while still maintaining their credibility with their fellow environmentalist libs.

5) ...they're the people who are really looking out for women, but they strongly support sexual predators like Bill Clinton and they regularly hurl grotesque sexist insults at feminist role models like Sarah Palin who don't toe-the-liberal-line.

6) ...we definitely need to have higher tax rates in this country. Yet many of Obama's nominees and cabinet members, including the Secretary of the Treasury, don't pay their taxes as is -- and liberals are okay with that.

7) ...guns should be banned! Yet, while they want to take guns out of the hands of law-abiding Americans who live in dangerous neighborhoods, they believe liberal celebrities like Michael Moore and Rosie O'Donnell should be able to hire armed bodyguards.

8) ...they're the ones who really care about educating children; yet time and time again, they support policies that hurt our kids, but help their political allies in the teachers’ unions.

9) ...running deficits are bad! After all, liberals ceaselessly took credit for the budget being balanced during the Clinton years and attack Bush for his profligate spending, right? Yet, despite the fact that Obama is running an unsustainable deficit so large that it threatens the future of the country, liberals are perfectly fine with it.

10) ...college campuses are supposed to be places of learning and intellectual openness, but they tacitly approve of conservative speakers being attacked and shouted down.

11) ...they're gay-friendly even as they work to out gay Republicans and they often accuse the Republicans they hate the most of secretly being gay.

12) ...they're the ones who are champions of free speech, but liberals want to silence their most effective critics on talk radio via the Fairness Doctrine.

13) ...they're the ones who really want to stick to the Constitution. Yet, liberals buy into a "living Constitution," which is nothing more in practice than substituting your personal opinion for what's actually in the Constitution.

14) ...it was terrible for George Bush to detain terrorists indefinitely, to use extraordinary rendition to send them to other nations, and to withhold more photos of what happened at Abu Ghraib -- but, when Obama did the exact same things, few liberals had anything to say about it.

15) ...we have to move away from sources of energy like oil, coal, and nuclear power towards what they believe are more eco-friendly power sources like wind power. Yet, whenever anyone tries to build a wind turbine, it's almost always a liberal that attempts to stop it -- just as Ted Kennedy did because he was afraid his yachting view might be spoiled if the ideas he championed were put into practice.

16) ...they're courageous for speaking out against Republicans while Hollywood and the media cheer them on, but when the time comes to speak out against the abuses of radical Muslims, they're terrified into silence.

17) ...when someone despises America, we need to ask, "What have we done to make him hate us?" -- but, when someone despises liberals for what they're doing to the country, they conclude that person must be ignorant, bigoted, or evil.

18) ...it's morally abhorrent to put a serial killer to death, but that a mother killing her baby via abortion is merely a "choice."

19) ...we have to count every vote, except for members of the military serving overseas, most of whom are denied their right to vote because Democratic politicians deliberately delay in sending out their ballots until it's too late for them to be returned in time.

20) ...when they looked at information from our intelligence agencies and concluded that Saddam Hussein had WMDs, they were just mistaken -- but when George Bush looked at the same info and drew the same conclusion, he was lying.

5/26/2009: Random Thoughts by Thomas Sowell

Random thoughts on the passing scene:

They say that people mellow with age. However, the older I get, the less patience I have with cleverness.

If increased government spending with borrowed or newly created money is a "stimulus," then the Weimar Republic should have been stimulated to unprecedented prosperity, instead of runaway inflation and widespread economic desperation that ultimately brought Adolf Hitler to power.

Just days after Colin Campbell informed us that the American people were willing to pay higher taxes in order to get government services-- and that Republicans therefore needed to stop their opposition to taxes-- California voters resoundingly defeated a bill to raise taxes in order to pay for the many government services in that liberal state.

Who was it who said: "I cannot tell what powers may have to be exercised in order to win this war"? George W. Bush? Dick Cheney? Donald Rumsfeld? Actually it was Franklin D. Roosevelt, in a "fireside chat" broadcast on September 7, 1942. He understood that survival was the number one right, without which all other rights are meaningless.

They say adversity concentrates the mind. Now that Republicans have been badly beaten in two consecutive Congressional elections, what Republican leaders in Congress are saying today makes more sense than what they said when they were in power.

When my sister's children were teenagers, she told them that, if they got into trouble and ended up in jail, to remember that they had a right to make one phone call. She added: "Don't waste that call phoning me." We will never know whether they would have followed her advice, since none of them was ever in jail.

One of the most important talents for success in politics is the ability to make utter nonsense sound not only plausible but inspiring. Barack Obama has that talent. We will be lucky if we escape the catastrophes into which other countries have been led by leaders with that same charismatic talent.

When I think of the people with serious physical or mental handicaps who nevertheless work, I find it hard to sympathize with able-bodied men who stand on the streets and beg. Nor can I sympathize with those who give them money that subsidizes a parasitic lifestyle which allows such men to be a constant nuisance, or even a danger, to others.

How surprising is it that Barack Obama, who spent decades hanging out with people who spewed out their hatred of America, did not say anything in the presence of foreign rulers like Hugo Chavez and Daniel Ortega, when they spewed out their hatred of America?

We seem to be moving steadily in the direction of a society where no one is responsible for what he himself did but we are all responsible for what somebody else did, either in the present or in the past.

Why let discussions with visiting celebrities be a constant distraction during a televised tennis match or baseball game?

If we each sat down and wrote out all the mistakes we have made in our lives, all the paper needed would require cutting down whole forests.

Much discussion of the interrogation of captured terrorists ignores the inescapable reality of trade-offs. The real question is: How many American lives are you prepared to sacrifice, in order to spare a terrorist from experiencing distress?

Governments should govern, not micro-manage the economy. A government unrealistic enough to think it can micro-manage is likely to do a worse job than most.

Inspiring as it is to study the history of the struggles and sacrifices that created and preserved America, it is also painful to see how all those investments of efforts and lives are being frittered away today for short-sighted and self-centered reasons.

Why the mere relocation of imprisoned terrorists from Guantanamo to prisons in the United States is a moral issue in the first place is by no means clear, since morality deals with behavior, rather than location. But putting them within the jurisdiction of liberal circuit court judges who can find reasons to turn them loose is a much more serious issue.

5/26/2009: President Has “More Effective” Method to Get Intel from Terrorists – What Is It? by Dennis Prager

In his latest address – on Guantanamo detainees – President Obama said something of extraordinary importance that seems to have been missed by the media:

“I know some have argued that brutal methods like water-boarding were necessary to keep us safe. I could not disagree more…I reject the assertion that these are the most effective means of interrogation.”

As this President chooses his words carefully, these claims need to be understood.

Note that Mr. Obama did not say what nearly all opponents of water-boarding say – that water-boarding is not an effective method of extracting reliable, life-saving, information. He took no issue with former Vice-President Dick Cheney’s claims that water-boarding or “enhanced interrogation” saved American and other lives. Indeed, he clearly leaves open the possibility, even the likelihood, that this claim is accurate. Rather, what he says is that “methods like water-boarding were not necessary to keep us safe” – not necessary, not ineffective. And why does he believe this? Because they are not “the most effective means of interrogation.”

In other words, the President’s view seems to be that water-boarding the three terrorists did elicit vital, life-saving, information. However, he contends that we could have obtained all that information using means of interrogation that were both non-brutal and more effective.

I pray the President is right. I would love America to be able to say “America never uses brutal methods of interrogation, let alone tortures” while simultaneously obtaining information it needs from captured terrorists to save thousands of innocent people from death and maiming.

But if in fact, these methods exist, they have never been revealed. President Obama needs to share this discovery with the American people, or, if they must be state secrets, with a select few individuals from Congress and the intelligence community.

It is as if the President, or anyone else, announced that brutal methods of combating cancer like chemotherapy and radiation were “not the most effective means” of combating cancer – and then refused to say what non-brutal means were more effective.

This is the paramount issue in the water-boarding debate. As Democratic Senator Charles Schumer said five years ago, it is essentially a no-brainer that we must “do what you have to do” if we apprehend a terrorist who has the information that can prevent an imminent terrorist attack.

Most opponents of water-boarding terrorists rely on the belief that such a method is as unnecessary as it is illegal. Therefore, if it is shown that water-boarding did in fact provide information that saved many innocent lives, opponents have to argue one of two positions: that there was a better, non-brutal, method available; or that it is morally preferable to have innocent Americans and others killed, brain damaged, blinded, and paralyzed rather than water-board a single terrorist.

Given that just about all of us – proponents of rare water-boarding and opponents of all water-boarding – want both security and not to water-board – the President can do the country and the world an extraordinary service by revealing – if necessary, only to a select few – what those non-brutal methods are that he knows to be “more effective.”

This would end the debate, give America more security, and enable us to say we never water-boarding or torture.

I, for one, pray those methods exist. But I don’t believe they do or that the President has a clue what they are.

5/26/2009: Millionaires Go Missing
Maryland's fleeced taxpayers fight back.

Here's a two-minute drill in soak-the-rich economics:

Maryland couldn't balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy. Politicians in Annapolis created a millionaire tax bracket, raising the top marginal income-tax rate to 6.25%. And because cities such as Baltimore and Bethesda also impose income taxes, the state-local tax rate can go as high as 9.45%. Governor Martin O'Malley, a dedicated class warrior, declared that these richest 0.3% of filers were "willing and able to pay their fair share." The Baltimore Sun predicted the rich would "grin and bear it."

One year later, nobody's grinning. One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller's office concedes is a "substantial decline." On those missing returns, the government collects 6.25% of nothing. Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year -- even at higher rates.

No doubt the majority of that loss in millionaire filings results from the recession. However, this is one reason that depending on the rich to finance government is so ill-advised: Progressive tax rates create mountains of cash during good times that vanish during recessions. For evidence, consult California, New York and New Jersey (see here).

The Maryland state revenue office says it's "way too early" to tell how many millionaires moved out of the state when the tax rates rose. But no one disputes that some rich filers did leave. It's easier than the redistributionists think. Christopher Summers, president of the Maryland Public Policy Institute, notes: "Marylanders with high incomes typically own second homes in tax friendlier states like Florida, Delaware, South Carolina and Virginia. So it's easy for them to change their residency."

All of this means that the burden of paying for bloated government in Annapolis will fall on the middle class. Thanks to the futility of soaking the rich, these working families will now pay Mr. O'Malley's "fair share."

5/24/2009: The California Scare Campaign by Matt Welch

Previously on Spring Street Blues, we had told you about how California's political-journalist class was gearing up to frighten-slash-chastise Californians about the "annihilating cuts" coming their way now that petulant voters failed to heed the weary wisdom of their betters. As this article in yesterday's L.A. Times demonstrates, one primary method for this uncoordinated campaign is news articles unlabeled as opinion. Check out the following grafs, and consider that this represents the bulk of the argument contained therein.

• [E]liminating as much as $24 billion from the proposed $95.5-billion general-fund portion of the 2009-10 state budget would further corrode an economy already creaking under the weight of a national recession.

• Distressed car dealers could see sales to state agencies shrink, printing shops may lose business as courts and other government operations shorten their workweek, and office-equipment suppliers would lose sales as cash-strapped agencies make do with aging copiers.

• And cutting as many as 5,000 state jobs, and perhaps thousands more as budget reductions cascade down to schools and local governments, would hit especially hard in a state that already has the fifth-highest unemployment rate in the nation.

• Gov. Arnold Schwarzenegger has proposed slashing state spending on education by $3 billion to help close the budget gap, and the state would pay dearly for canceling classes, firing instructors, cutting class days and shortening the school year, experts said.

• Promising students would go to other states, taking their future skills, earnings and, possibly, Nobel Prizes elsewhere. California companies would then find it harder to attract high-value employees who might be dubious about moving to a state with sub-par schools. [...]

• John Sedgwick, co-founder of Santa Clara solar-energy company Solaicx, agreed.

• "When you think about the genesis of Silicon Valley, it really started from its superior educational base" at Stanford and UC Berkeley, said Sedgwick, whose company makes the building blocks for photovoltaic cells. "That indicates that you don't want to kill the goose that's laying the golden eggs." [...]\

• Businesses have long complained about big-spending government in California. But with state and local spending accounting for about one-fifth of the state's gross domestic product, California is in line with some other heavily populated, expensive-to-manage states, such as New York and Florida. [...]\

• "Government is supposed to be a stabilizing influence, and instead they're becoming part of the problem," said Christopher Thornberg of Beacon Economics. "They should be spending when everyone else is cutting back. They should be buying cars when no one else is buying cars."

Eight quick counterpoints:

1) The alternative scenario, represented by the various tax increases and budget gimmicks that failed to pass muster last week, is never introduced as a comparison point. The mostly dreamed-up scenarios about that $24 billion cut (which I'll believe when I see) are never compared to the effect of tax hikes on a wobbly economy and suffering populace. Traditionally, all else being equal, smaller taxes equals more economic growth.

2) An economy (or business strategy) that relies on the government buying cars is neither sustainable in the long-term nor an efficient use of taxpayer dollars at any time. As Jacob Sullum has repeatedly pointed out, "That's a recipe for wasteful spending that will divert resources from more productive uses, and ultimately for higher unemployment than would otherwise occur." Put another way, there have indeed been many countries whose governments have provided most of the spending, and whose unemployment figures were very low. These were, in most cases, countries that couldn't afford many cars, on account of being so poor.

3) Do you know how many 5,000 state jobs are? A whopping 2 percent of the state work force, maximum. If that's "annihilating," how on earth would you characterize a 3 percent cut? As genocide?

4) Use of the word "experts" is one of the great tells in journalism. It usually means something close to "those people I cherry-picked to agree with my thesis." It is an artificial and scientific-sounding reputation-enhancer, one used in stark contrasts to the way that critics of said thesis will be portrayed in the same article.

5) "Promising students would go to other states, taking their future skills, earnings and, possibly, Nobel Prizes elsewhere"? What? There is no scenario being contemplated that I'm aware of where the net number of University of California students will be decreased under whatever cuts are coming. Does higher tuition = less Nobel Prizes? I dunno, ask the aforementioned Stanford, which IS A PRIVATE UNIVERSITY THAT WON'T BE AFFECTED BY THESE ANNIHILATING CUTS, YA MAROON.

6) California companies would then find it harder to attract high-value employees who might be dubious about moving to a state with sub-par schools. Here is the fundamental point behind every California budget story: The state has increased spending on K-12 education by 40 percent under Schwarzenegger (it has to; by dumb law, 40 cents on every state dollar has to go to education). The main drain on the California economy is that these massive increases in spending are producing ZERO noticeable improvements. Because the union-run school districts are infamous laboratories for inefficiency, job protection, and corruption, the state spends and spends, with nothing to show for it. Teachers unions are literally running out of other people's money, and now they warn us about "sub-par schools"? That par got done subbed a long time ago. If politicians, journalists, and other "experts" want to defend the status quo (of constant spending increases), then they need to explain why Californians need to keep throwing more and more good money after bad on a K-12 system that is showing no results.

7) Remember what I said about the opposite of "experts"? "Businesses have long complained about big-spending government," sez the Times. So in a direct comnparison here, the "experts" "said" that "the state would pay dearly" for education cuts; meanwhile "businesses" have "complained" about spending. Of course, the next sentence starts with the word "But." It's almost as if this is an editorial instead of a news article! Well, not quite–the editorial version would call the opposition "small-government zealots [who] lecture smugly that California has gotten its comeuppance for years of prodigal spending and unrighteous living." I swear to God I am not making that sentence up.

8) Speaking of that big "But," there are two other classic weasel-word phrases in the ensuing sentence– "some," and "such as." This allows the writer to ignore a state that is much closer to California's population, geography, and demographics than Florida or New York: Texas. According to U.S. Government Spending dot com, California state and local governments are currently spending 21.9 percent of GDP, compared to 14.5 percent for Texas. Big diff. Also, the whole GDP comparison in the first place, while useful, implicitly suggests that at minimum government spending should march right along with private-sector wealth creation.

I have no doubt whatsoever that some of the impending California budget cuts will be painful, inflicting harm on precisely the type of person you might otherwise want to help with a social safety net. That's not because the state is spending just the right amount of money right now, but because the state, like all lumbering bureaucracies (including the L.A. Times) is even more horribly inefficient in cutting spending than it is at spending money in the first place. The Times is a useful example in this case: For around a decade of job cuts, the paper didn't go around firing the newsroom's ample dead wood, it offered buyouts to anyone who would walk. And who is most likely to take such a deal? People who are confident they can match their earnings elsewhere. In other words, the employable.

Calfornia lawmakers, and the unions who put them into office, will do everything in their power to cut services first, employees last. That is indeed a crucial reason why we got here in the first place. Any analysis that doesn't explore how a higher-than-inflation-plus-immigration budget has failed to deliver on any increase in services, is not an analysis worth taking more seriously than common propaganda.

5/19/2009: Is democracy just majoritarian rule? by Tibor Machan

Q: Recent events make it seem all the more apparent that democracies must inevitably lead to tyranny of the majority. Is democracy just majoritarian rule?

A: If you object to having your liberty and property taken by the majority, some political theorists object claiming that democracy is precisely for such a purpose. But that is not so.

In a free society the purpose of democracy amounts to authorizing some people who have majority support to help update the Constitution. The updating, in turn, is not for the sake of changing it, abolishing its principles and so forth. It is so as to extend constitutional principles to novel areas that could not be anticipated when the constitution was framed. There was no Internet, telephone, iPod, telegraph and so forth yet these are all capable of being used to commit crimes. Lawmakers, those elected to various local, county, state and federal offices, are supposed to figure out how the basic principles of the constitution–presumably a sound document stating how citizens ought to comport themselves toward one another without violating anyone’s rights–can be applied to new technology, new science, and so forth.

Instead a great many people think that democracy has to do with imposing their will upon their fellows whether it is allowed or not. But that is just what having our individual rights prohibits. In a free country no one gets to violate rights, not even majorities. Those representing us at various centers of politics aren’t there to perpetrate complex forms of larceny, theft, trespass, kidnapping and the like. No one gets to do such a thing to free citizens, never mind how many get together claiming they may do so. Otherwise the country stops being a free one altogether.

Of course, countries can be more or less free and so far the United States of America has managed to earn the label “free” in comparison to most others. Yet, when our president shows friendship toward the likes of Hugo Chavez–and past presidents have shown admiration for the likes of Mussolini and Marcos and Pinochet and the like–the time has come to reaffirm our fundamental commitment to principles that flatly reject the political ideas of these sort of leaders. But sadly because Chavez, and many other dictators before him, have gained majority support in their countries and could then say that the tyranny that they were perpetrating thus had political legitimacy, America too has slid into a kind of democratic despotism, with leaders who make no bones about using their power to conscript the labors and resources of the citizenry for purposes they claim have majority support.

All the funds being borrowed now and devoted to bailing out commercial enterprises that lack market support with funds that future citizens will have to repay–citizens whose vote no one knows and thus lack representation–amount to wrongful taking, plain and simple. And this isn’t anything new, either. Funds used to contribute to countries abroad, funds used to subsidies struggling domestic businesses, funds used to support so called public projects that actually benefit only small special interests–all these are illegitimate takings in a genuine free society. And they are all being defended on the basis of democracy. But that is a completely misguided understanding of what democracy must mean for a free people.

The American founders seemed clearly to have in mind establishing a free country, not a democratic despotism. This is made very clear from the Declaration of Independence and the Bill of Rights which identify the rights of individual citizens and do not authorize small or large majorities to carry out criminal deeds for which individuals would be prosecuted if they committed them. That is why the Founders were revolutionaries–they disbelieved in the superiority of the government. They viewed it, instead, as an agency that’s instituted merely to secure individual rights not one, like a monarchy, that would rule those individuals, impose on them unwanted, unchosen burdens. This is the idea that needs to be recovered in America.

5/20/2009: The Medicare Ponzi Scheme by John Stossel

Isn't it high time America did less for the elderly? A politically incorrect question for sure. But Medicare has an astounding $34-trillion unfunded liability. And because of rising unemployment, its hospital-stay program will go broke two years earlier than previously predicted.

For my recent ABC special "You Can't Even Talk About It", I spoke with residents of La Posada, a development in Florida that made Forbes's list of top 10 "ritzy" retirement communities. These folks are well off. And they get a bonus: You pay for most of their health care under Medicare.

The retirees love it. Everyone likes getting free stuff. And Medicare often makes going to the doctor just about free.

Why is this a good thing?

"What about those young people [who pick up the tab]? What kind of legacy are we leaving for them?" asks Harvard Business School Professor Regina Herzlinger. "We're really stealing from them."

Some high-school students are alarmed about the scam. "20/20" interviewed a group that is willing to help needy seniors -- they volunteer at a food bank -- but they are angry that Medicare forces them to pay for even wealthy seniors.

"This program, Medicare, is essentially ripping my generation off," Zach Hadaway said.

Policy experts say the kids are right.

"The government spends around $6 on seniors for every dollar it spends on children, and yet the poverty rate among children is far higher," said Andrew Biggs of the American Enterprise Institute (www.aei.org).

The federal government stiffs the young in favor of the old.

So I told the La Posada seniors that the kids called them "greedy geezers." They said, "We've paid our dues." Money was taken from every paycheck they earned.

But, in fact, the average Medicare beneficiary today collects two to three times more money than he paid in.

"I would argue that this is not only unfair, it's downright immoral," says billionaire Pete Peterson.

Peterson is a rarity: a senior who decided he cannot in good conscience accept Medicare. He and his foundation (www.pgpf.org) worry about the looming fiscal disaster. When Medicare began in 1965, six working-aged people paid for each Medicare recipient. Now the figure is four. It will get worse as baby boomers like me retire.

Medicare is unsustainable.

"There is $34 trillion sitting off the balance sheet, waiting for future generations to pay," Herzlinger said.

That's how much more Medicare money government has promised than it has budgeted. It's the price of about 30 Iraq Wars.

We locked up Bernie Madoff for running a Ponzi scheme. Medicare is a bigger one. Seniors think the money deducted from their paychecks was stored in a trust fund. But, in fact, it was spent immediately. The "trust fund" is an accounting gimmick.

The giant seniors' lobbying group, AARP (www.aarp.org), rarely talks about Medicare's coming bankruptcy, and it rejects reforms like means-testing or raising the eligibility age, claiming most problems can be solved simply by lowering health-care costs.

"Do things like make better use of health information technology," David Certner, AARP's director of legislative policy, told me.

The Congressional Budget Office says such reforms won't save much money.

"Well, they're going to have to," Certner said.

That sounds like wishful thinking -- not unusual among powerful lobbies that ignore basic economics. When something is free for one group, demand runs wild, pushing up prices for those who must pay for themselves and the subsidized group.

On top of that, the demographic problem Peterson emphasizes won't go away, no matter how cleverly the "fix health care" argument tries to bury it. Fewer workers per retiree means shrinking Medicare tax revenues -- period -- even if health-care costs are flat.

"Ultimately, somebody's going to have to give up some medical treatment they'd been getting," Peterson says.

Our group of seniors had second thoughts after we spoke. "I hear what the kids are saying," a man said, "When they get to be our age, there may not be any Medicare."

"Tell them to change the law," one said. "If the kids can get the votes, then they can get it done."

Fat chance. The elderly vote on Medicare.

Most young people don't even know they're getting ripped off.

5/20/2009: Empathy Versus Law by Walter E. Williams

President Obama's articulated criteria for his nominee to the U.S. Supreme Court is: "We need somebody who's got the heart to recognize -- the empathy to recognize what it's like to be a young teenage mom, the empathy to understand what it's like to be poor or African-American or gay or disabled or old. And that's the criteria by which I'm going to be selecting my judges."

What is the role of a U.S. Supreme Court justice? A reasonable start for an answer is the recognition that our Constitution represents the rules of the game. A Supreme Court justice has one job and one job only namely; he is a referee. There is nothing complicated about this. A referee's job, whether he is a football referee or a Supreme Court justice, is to know the rules of the game and make sure that they are evenly applied without bias. Do we want referees to allow empathy to influence their decisions? Let's look at it using this year's Super Bowl as an example.

The Pittsburgh Steelers have won six Super Bowl titles, seven AFC championships and hosted 10 conference games. No other AFC or NFC team can match this record. By contrast, the Arizona Cardinals' last championship victory was in 1947 when they were based in Chicago. In anyone's book, this is a gross disparity. Should the referees have the empathy to understand what it's like to be a perennial loser and what would you think of a referee whose decisions were guided by his empathy? Suppose a referee, in the name of compensatory justice, stringently applied pass interference or roughing the passer violations against the Steelers and less stringently against the Cardinals. Or, would you support a referee who refused to make offensive pass interference calls because he thought it was a silly rule? You'd probably remind him that the league makes the rules, not referees.

I'm betting that most people would agree that football justice requires that referees apply the rules blindly and independent of the records or any other characteristic of the two teams. Moreover, I believe that most people would agree that referees should evenly apply the rules of the games even if they personally disagreed with some of the rules.

The relationship between Supreme Court justices and the U.S. Constitution should be identical to that of referees and football rules. The status of a person appearing before the court should have absolutely nothing to do with the rendering of decisions. That's why Lady Justice, often appearing on court buildings, is shown wearing a blindfold. It is to indicate that justice should be meted out impartially, regardless of identity, power or weakness. Also, as Justice Oliver Wendell Holmes said, "Men should know the rules by which the game is played. Doubt as to the value of some of those rules is no sufficient reason why they should not be followed by the courts." The legislative branch makes the rules, not judges.

Interventionists often make their case for bending the rules based on the unfairness of outcomes such as differences in income, education and wealth. After all, how can the game of life possibly be fair when some people's yearly income totals in the hundreds of thousands, even millions of dollars, while many others scarcely earn twenty or thirty thousand dollars? Some people find that argument persuasive but it's nonsense. Income distribution is an outcome and fairness cannot be determined by outcomes. It's the same with football. The Steelers winning six Super Bowl titles and Arizona winning none is an outcome and cannot be used to determine football fairness. Fairness in either case must be settled by process questions such as: Were the rules unbiased and evenly applied? If so, any outcome is just and actions based on empathy would make it unjust.

5/19/2009: The Eve of the American Reawakening

Rep. Tom McClintock gave the following speech to the Council for National Policy in Washington DC on May 16, 2009.

Here, in the winter of our despair, I want to pause to take stock of the state of our nation on this date of May 16th.

Voters have swept our party from office after a failed Republican administration that abandoned conservative principles. The most left-wing President in our nation’s history has taken office with a 66 percent approval rating and strong majorities in both houses. His agenda includes radical intervention into energy markets, highly inflationary monetary policy, a determination to dramatically reduce our military spending while dramatically increasing overall domestic spending with deficits as far as the eye can see.

That was the state of our nation on May 16th…1977.

You remember those years. Jimmy Carter’s policies brought us double digit unemployment AND double digit inflation; interest rates at 21 percent, mile-long lines around gas stations, embassies seized with impunity and a military so weak it couldn’t even project a simple rescue mission.

But then, just a few years later, it was morning again in America. Four years of Jimmy Carter produced eight years of Ronald Reagan, and looking back on it, that wasn’t such a bad trade, was it?

Abraham Lincoln once said that if the voters get their backsides too close to the fire, they’ll just have to sit on the blisters for a while.

The American people have some very painful blisters to sit on for the next four years, but the good news is that they’re already starting to figure that out.

On inauguration day, the Rasmussen poll gave the President a net approval rating of 28 points. Yesterday, that figure was seven points. During the fall campaign, Rasmussen reported that the generic Democratic candidate for Congress had a 16-point advantage over the generic Republican candidate. As of May 10th, Rasmussen reports the generic Republican now has a one-point advantage over the Democrat.

Although the President’s personal popularity remains high, most polls are showing a decidedly increasing skepticism over his policies. For example, yesterday Rasmussen reported that by a margin of 57 to 19 percent, Americans say that tax increases will hurt the economy.

What we are seeing in the polls is the gradual awakening of the American people. When things are going reasonably well – or even reasonably poorly – most people don’t pay a lot of attention to politics because there are too many other pressing things going on in their lives. But when a crisis approaches, that’s when you see the strength of a Democracy emerge, and it is an awesome thing. One by one, individual citizens sense the approach of a common danger and rise to the occasion. They begin focusing a great deal of attention on politics and they start making very good decisions.

We saw that two summers ago, when the McCain-Kennedy amnesty bill was set to glide through both houses of Congress on broad bi-partisan majorities. But the American people had finally had enough of being told there was nothing the government cared to do to defend the integrity of our borders and the sovereignty of our nation. And McCain Kennedy didn’t even make it to a final vote.

We saw that last summer, when gasoline prices hit $4 a gallon and the American people had finally had enough of being told there was nothing the government cared to do to get out of the way of domestic oil production. And in the span of just a few months, they turned 180 degrees on the issue of offshore oil drilling and nuclear power.

We saw that just a month ago, when Rick Santelli told a routine cable broadcast that he was sick and tired of being forced to pay his neighbor’s mortgage – and the whole trading floor erupted in applause. He suggested that Americans need to rekindle the spirit that produced the Boston Tea Party, and suddenly, from every corner of America over 800 taxpayer protests erupted across the country on April 15th. These protests weren’t sponsored by parties or politicians. They were a grassroots uprising by a silent majority that will not remain silent any longer.

And yet I read the other day of a new chorus of hand-wringing that said we had to get over our nostalgia for Reagan, that we had to be mindful and respectful of the fact the “other side has something,” and that we have nothing, and that “you can’t beat something with nothing.

It’s the same kind of hand-wringing that Ulysses S. Grant confronted at the Battle of the Wilderness among generals overawed by Robert E. Lee’s aggressiveness, audacity and success. Grant, turned to his distraught generals, and said “Bobby Lee this, and Bobby Lee that! You’d think he’s going to do double somersaults and outflank us on both sides and the rear. Stop thinking about what Bobby Lee’s going to do to us, and start thinking about what we’re going to do to Bobby Lee. Now get some guns up here.”

To those who say we should put the Reagan era behind us – I have a better idea. Let’s put the Bush era behind us.

To those who say we should redefine our principles, I have a better idea: we don’t need to redefine our principles; we need to return to them.

To those of the Republican establishment, who misled our party for years, who dismantled so much of what Ronald Reagan accomplished and now tell us “the other side has something” and we have nothing. To them I can’t improve upon Cromwell’s words: “You have sat here too long for any good you have been doing; it is not fit that you should sit here any longer. You shall now give way to better men. Now depart and let us have done with you, I say, in the name of God, GO!”

“The other side has something and we have nothing?”

What is the something the other side has – that some say we have to be respectful and mindful of?

Statism. Shortage. Paternalism. That’s their “something” that seems to so overawe and over-impress these scions of a failed party establishment.

Statism, Shortage and Paternalism is what we are told to be mindful and respectful of? I don’t think so.

Their statism is “something” so extreme that the entire national debt accumulated from the first day of the George Washington administration to the very last day of the George W. Bush administration will literally double in the next five years and triple in the next ten.

The tax increases already proposed to support it will rob every family of more than $2,500 from its purchasing power every year. We’re supposed to respect that? The American people don’t respect it. The American people know that you cannot spend your way rich; that you cannot borrow your way out of debt and you cannot tax your way to prosperity. And they know that if you live well beyond your means today, you must of necessity live well BELOW your means in the future. And that’s not a future we want for our children.

Their entire policy is predicated on maintaining shortages of everything from health care to energy and then using the force of government to ration that shortage according to their own whims. The “something” that they propose to solve their government-induced shortages is having bureaucrats tell us what medical treatments our kids may have and when they may have them; raising energy prices until we bicycle to work; telling us what kind of light bulbs to use, where to set our thermostats, when to use our appliances.

And then there’s Paternalism. That’s what Rick Santelli was talking about. When your neighbor buys the house he can’t afford – it’s now your job to pay his mortgage. When the fraternity brothers of Paulson and Geitner party their investments into the ground – now it’s your job to cover their losses. When the reckless country-clubbers of General Motors and Chrysler give away the farm to the UAW – now it’s your job to make up the difference, and by the way, now it’s Barney Frank’s job to tell you what kind of car you may buy.

That is the “something” that seems to send these self-described “New Republicans,” into paroxysms of awe and policy-envy.

That’s the “something” that some people are so deathly afraid of saying “NO” to. Churchill said, “Alexander the Great remarked that the people of Asia were slaves because they had not learned to pronounce the word “NO.” Let that not be the epitaph of the English-speaking peoples or of parliamentary democracy … There, in one single word, is the resolve which the forces of freedom and progress, of tolerance and goodwill, should take.”

What is the “nothing” that we have that so dismays and disgusts these same messiahs of mediocrity – this “nothing” that’s convinced them that we must wean ourselves from our unseemly nostalgia with such irrelevant has-beens as Reagan, and Lincoln and Jefferson – I add the others because they stood for exactly the same principles as Reagan.

We stand for freedom.

We stand for abundance.

We stand for individual responsibility.

Freedom. Abundance and Responsibility. That is our platform.

Those who call that “nothing” are the same failed leaders who disdained it during the Reagan years and dismantled it as soon as the Reagan years were over.

They stand for statism. We stand for freedom: The God-given right to enjoy the fruit of our own labor; the right to raise our children according to our own values; the right to express our opinions and our faith freely and without reserve; the right to defend ourselves and our families; the right to enter into voluntary associations with each other for our mutual betterment without an army of busy-bodies telling us what is best for us.

They stand for the rationing of shortage. We stand for abundance: what happens when free men and free women enjoy the liberty to go as far as their desire, talent and imagination can guide them and as far as their labor, industry and enterprise can take them. Societies prosper when freedom protects the rights of each of us to decide on our own what we will produce and what we will consume. Government exists to protect the conditions that produce abundance, not to ration shortages that government has caused.

They stand for paternalism. We stand for personal responsibility. That means you stand by your promises. That means you tell your customers the truth about your products and investments. It means if you bring a child into the world then by God you look after that child. And it means if you make a bad decision, you set it right and you learn from it – and you realize that the bad decisions we all make from time to time is the price we pay for the freedom to make all the good decisions in our lives.

Freedom. Abundance. Responsibility. Ladies and Gentlemen, that ain’t “nothing.” That’s everything.

That’s everything our country is, everything our country stands for. That’s everything ten generations of Americans have fought to defend. That is everything that the happiness and prosperity of society depends upon. That is everything that we have – everything that we are – everything that we hope as Americans.

Jefferson called it the “sum of good government” which he described as “a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned.”

At the risk of politically incorrect nostalgia, nine years before he became Governor of California, Reagan put it this way during a commencement address to his alma mater. He said, “This is a simple struggle between those of us who believe that man has the dignity and sacred right and the ability to choose and shape his own destiny and those who do not so believe. This irreconcilable conflict is between those who believe in the sanctity of individual freedom and those who believe in the supremacy of the state.”

Lincoln said much the same. He said, “That is the real issue. That is the issue that will continue in this country when these poor tongues of Judge Douglas and myself shall be silent. It is the eternal struggle between these two principles – right and wrong – throughout the world. They are the two principles that have stood face to face from the beginning of time; and will ever continue to struggle. The one is the common right of humanity, and the other is the divine right of kings. It is the same principle in whatever shape it develops itself. It is the same spirit that says, ‘You work and toil and earn bread, and I’ll eat it.’ No matter in what shape it comes, whether from the mouth of a king who seeks to bestride the people of his own nation and live by the fruit of their labor, or from one race of men as an apology for enslaving another race, it is the same tyrannical principle.”

And today, our country faces this tyrannical principle in actual practice.

The Left would condemn our children to the failure of government schools run by teacher unions. We would liberate parents to select the school and the teacher that best meets their child’s needs and hold the school and the teacher accountable for the results.

The Left would condemn our families to sky-high energy prices; we would free America’s vast energy reserves and limitless supplies of clean, cheap electricity through nuclear power, hydro-electricity and clean coal.

The Left would condemn our health care to bureaucrats who’ll decide what treatments we may have and when we may have them. We would provide the tax credits to bring a basic health plan within the financial reach of every family – a health plan they could chose, they could own, and they could change if it failed to serve them.

The Left would deny union members the right to a secret ballot; we would free employers to pay bonuses to union members above and beyond their union contract.

The Left would plunder our children of their prosperity tomorrow to pay for the unprecedented expansion of government today. We insist on a government that does what families do every day: work hard, waste not and live within our means. And that promise needs to begin with renouncing the failed Bush administration that violated every one of these tenets.

The Left offers stifling central planning to manage every aspect of our lives; they offer higher and higher taxes and more and more costly regulations. We offer freedom.

It’s ironic that the same rocket scientists who say we have to listen more to the opposition’s message obviously haven’t been listening to our own.

We have the most powerful message in the history of mankind. It is freedom. And to those who say we have no messengers – look around at each other. Yes, Ronald Reagan was a great communicator, but as William Saracino has said, “He wasn’t communicating cookie recipes.” And if we learned anything at all from that great man, it was that every one of us needs to be a messenger.

In February of 1861, Abraham Lincoln’s inaugural train paused in Indianapolis and he spoke these words: “Of the people when they rise in mass on behalf of the Union and the liberties of their country, it may be said ‘The gates of hell shall not prevail against them. I appeal to you constantly to bear in mind that not with the President, not with the office-seekers, but with you is the question, ‘Shall the liberties of this country be preserved to the latest generation.’”

That is our clarion call. Ladies and Gentlemen, what has happened to our nation has happened on our generation’s watch, and it is our generation’s responsibility to set things right.

Does anyone here have any doubt how this battle will end as long as we stand firm? I think the Left is starting to figure that out too, and behind the smarmy smirks of superiority, their real sentiments are showing through.

The Department of Homeland Security refuses to use the word “terrorist” to describe Al Qaeda. It has replaced the term “acts of terrorism” with the term “man-made disaster” so as not to offend Islamic extremists. But it doesn’t hesitate to declare every American who believes in Constitutional principles or who defended those principles on far off battlefields as “potential domestic terrorists.”

That offers real insight into the Left. Churchill put it this way: “They are afraid of words and thoughts. Words spoken abroad, thoughts stirring at home – all the more powerful because forbidden – terrify them. A little mouse – a little tiny mouse – of thought enters the room and these mighty potentates are thrown into panic. They make frantic efforts to bar out thoughts and words; they are afraid of the workings of the human mind.”

Think about what terrifies the Left. Letters to the editor. Calls to talk shows. Blogs on the internet. Comments after newspaper editorials. Taxpayer tea parties.

Why did they react so viscously to the tea parties? You remember the tale of the “Emperor’s New Clothes” – once the townspeople realized that there were many others who believed as they believed, the façade collapsed.

So let’s not disappoint our friends on the left. Let us all here today resolve that we’re going to spend at least ten hours a week agitating and educating in every forum we can find.

When the American Founders adopted the Declaration of Independence, they pledged to each other their lives, their fortunes, and their sacred honor. They were speaking quite literally. When they pledged their lives, they meant it. The King had already warned that a noose awaited every one of them. When they pledged their fortunes, they meant it. Lewis Morris had just received word that his estate in New York had been burned to the ground, that his family had become refugees and that his two sons had enlisted in the rag-tag army around General Washington.

How little history demands of our generation in defense of those same principles. We aren’t asked to pledge our entire fortunes – just a small portion of our earnings in support of the causes and candidates we believe in. We aren’t asked to pledge our lives – only a small portion of our lives until we have set things right.

But our sacred honor – that history demands of us in full. That we leave today highly resolved not to fail or falter until we have restored freedom as the cornerstone of our government. Because if we fail to do that, then what history will demand of our children and grandchildren is unthinkable.

So let us honor the memory of Reagan and Lincoln and Jefferson and all those placed freedom above security and principle above politics. To those among us who would do otherwise, as Shakespeare said, “He who hath no stomach for this fight, let him now depart.”

And then let us together write the next chapter of the American Republic: that just when it appeared that the principles of American freedom were faltering, this generation rediscovered them, rallied to them, revived them, restored them, polished them and passed them on shining and inviolate to the many succeeding generations that followed.

5/19/2009: The Six Problems With Modern Liberalism by John Hawkins

1) You really didn't learn everything you needed to know in kindergarten: Liberals love to think of themselves as sophisticated, nuanced intellectuals, but the truth is they have a kindergartner’s view of the world. If it has been defined as "nice" to people they like, they're for it. If it has been defined as "mean" to people they like, they’re against it -- and that is about as deep as it gets. Unfortunately, that lack of adult perspective isn't so cute in political leaders who are making life and death decisions that may still have ramifications fifty years from now.

2) "Liberals hate religion because politics is a religion substitute for liberals and they can't stand the competition." -- Ann Coulter: Somewhat ironically, given the hostile relationship that has developed between the Left and Christianity, liberal beliefs have more in common with religious doctrine than a political agenda. There is no significant debate on the Left about the aims of their agenda -- and the only "sins" believers can commit against their religion are no longer being politically useful, deviating from doctrine, or worst of all, cooperating with conservatives in some fashion. No matter how much evidence piles up that big government doesn't work, that welfare destroys families, and that socialism doesn't bring prosperity, it makes no impact on liberals because their dogma is based on faith, not logic.

3) "It is not human nature we should accuse but the despicable conventions that pervert it." -- Denis Diderot: There is no dream more eternal in the liberal heart than completely remaking human nature. If we could all just care about the person across the world as much as we do our families, we could live in a utopia! Unfortunately, in practice, human nature tends to be quite a bit more difficult to subvert than in the liberal imagination. That's why, despite more than 5,000 years of human civilization, very little progress has been made in this area – but, oh, the Left is still trying. One day, if they just spend enough money on the right government programs, all the wars will end and everyone will be living in identical million dollar mansions while we spend our days humming tunes from the latest Woodstock Tribute Album.

4) "Oh what a tangled web we weave, when at first we practice to deceive." -- Sir Walter Scott: Like freaky religious cults, liberals have become adept at hiding their more abhorrent views from the public until it's too late. It’s common to see liberals adamantly deny that they hold a position over and over again only to completely switch sides the moment they have one more vote than they need to pass legislation. Whether it's lying about their opponents or what they believe, honesty is certainly not considered to be the best policy on the Left.

5) "Why do you look at the speck of sawdust in your brother's eye and pay no attention to the plank in your own eye." -- Matthew 7:3-5: Despite the fact that liberals love few things better than to cry "hypocrisy," there is a rather bizarre disconnect between what modern liberals seem to believe about themselves and how they behave. Liberals believe that they're compassionate, but only with other people's money. They tie themselves in knots trying to come up with valid reasons why terrorists hate the United States, but they never give a moment's thought to whether the people who dislike them might have a point. They pat themselves on the back for helping minorities, but never stop to consider that liberal policies have done more damage to black Americans in the last fifty years than the KKK could have done in a millennium. Somehow, stunning hypocrisies of this sort, which are too numerous to recount without doing a whole other column, never seem to be bother anyone on the Left.

6) "Trust yourself. You know more than you think you do." -- Benjamin Spock: It's great to have a healthy self-image, but there's not much to be said for thinking you're smarter than the collective wisdom and traditions passed down through human history just because you happen to read the Daily Kos. Unbecoming arrogance of this sort permeates modern liberalism. The most grave of decisions are undertaken by the modern Left without the slightest regard for the potential consequences. Past disasters created by similar bouts of whimsical thinking, of which there are many, are treated as acts of God untethered from mere human decision making and prompt no self reflection whatsoever. That's because to the modern liberal, the real world results of their policies are secondary in importance to the amount of positive self-esteem generated by supporting that policy.

5/12/2009: The Trouble With "Single-Payer Healthcare" By David McKalip, M.D.

Pennsylvania HOUSE Health Council TESTIMONY
David McKalip, M.D.
Chairman, Council on Medical Economics, Florida Medical Association
President, Florida Neurosurgical Society
Chairperson, Florida Taxpayers Union

"Any society that would give up a little liberty to gain a little security will deserve neither and lose both." — Benjamin Franklin

"Was the government to prescribe to us our medicine and diet, our bodies would be in such keeping as our souls are now." —Thomas Jefferson: Notes on the State of Virginia, Query XVII, 1782.

Thank you for bringing me to testify before the Pennsylvania House Health Care Policy Task Force. I am a private practice neurosurgeon from Florida and for over ten years, I have practiced in academics, small group and solo settings taking care of patients from all walks of life. While in my first practice at San Francisco General Hospital, I saw the many shortcomings of a government run hospital. Even with dedicated professional health care staff, the constant budget shortfalls, debt and politically motivated regulatory burdens drained the hospital there. Patients waited weeks to go to rehabilitation units while patients in private systems went in days. Repeat patients never took responsibility for their own health — always assuming that the public system would be there for them. I went to San Francisco a young liberal and left two years later a disillusioned doctor. After about two years in private practice I began to realize that only the private sector could deliver high quality affordable health care in the most fair and equitable way without rationing. That is not to say that the current structure of private health care is perfect — it is encumbered by a complex and odd system of financing that few economists would design: third party financing of first dollar coverage. Nevertheless, the care patients receive through private health insurance is far better than that received by those with government funded health care. Better than private or public third party payment is the results produced when patients spend their own money from a health savings account backed by a catastrophic health plan. (But I will discuss that more later).

I saw Medicaid patients for seven years by choice even though Medicaid in Florida pays only 56% of Medicare rates and each patient entering my practice was the equivalent of me writing them a check. I couldn't blame other neurosurgeons who were not taking these patients and I saw patients drive hours to see me. Finally I opted to see Medicaid only for hospital emergencies — not in my office.

Another publicly run health system also has neglected some of our most valued citizens: The Veterans Administration. Layers of stifling bureaucracy and limited resources have lead to long waits for advanced medical care. At multiple V.A.'s I saw Veterans wait months for a spine surgeon while living with crippling pain or slowly evolving paralysis, get put on another waiting list for surgery and have their surgery cancelled at the last minute simply because there wasn't enough staff to keep working after 3 pm or any interest of the employed physician staff to work harder.

I have seen Medicare patients denied advanced spinal surgical techniques or subject to overnight stays when others go home the same day due to arcane rules. I have had to perform two surgeries on Parkinson's patients for dual brain stimulator pacemakers since Medicare won't pay for the single pacemaker at the same price! I have seen how Medicare patients wait over an hour to see a Nurse Practitioner for 10 minutes and their doctors for 3 minutes and leave confused only to enter the mill again. I have seen referrals to specialists from Nurse Practitioners that a primary care physician could have avoided. But the number of primary care doctors has dropped as Medicare has artificially controlled the amount of payment for their services. I also routinely see able-bodied patients inappropriately granted disability for health care and disability benefits.

What I have seen is the slow death of the medical profession. Unfortunately, the final nails in the coffin are coming as even more arcane rules, price controls and political meddling are envisioned by governments all over the nation. Now I hear that Pennsylvania wants to enter into one of the most dangerous systems of health care financing ever devised: A single payer system.

Many utopian dreamers are motivated by the best of intentions and envision that the best way to achieve high quality health care is to create a system by which the government will control all health care spending and ensure that it is equitable, efficient and proper. They are basing their approach on an economic philosophy that has failed many times in history — one of collectivism and central economic planning. Many of those advocating such a system believe that if an elite group of all knowing and benevolent planners control spending, that nothing but good will result. Unfortunately this had never been the case as evidenced by the fall of the Berlin Wall, the lack of property and individual rights in societies under dictators, and recent examples of failing government-run school systems in America with a never-ending supply of money.

Those advocating single payer systems don't understand that what made America great was not centrally planned economies. Success in America came from free markets where individuals owned their own property and are supported by a rule of law to privately negotiate terms of payment and exchange with willing producers. Those pushing single payer financing mistakenly label the system of private health insurance as a free market when it is in fact an overregulated cartel that relies on political connections to protect its profits. The sad truth is that the American health economy has not had a truly free market for decades since patients don't pay for routine annual health care. And now, when control of health care financing by third parties has lead to runaway medical inflation and rampant dissatisfaction among patients — an expansion of third party control of health care financing is proposed. But this third party would be the State and the State would be forced to finance health services amid shrinking budgets and increasing demands. All while avoiding rationing and interference in the patient-physician relationship. History shows us that this is impossible.

In fact, as I have fought for tax reform in Florida, I have come to discover that the root of most of our budgetary shortfalls in government and even in private industry are unrealistic promises for health care and retirement benefits ultimately funded by the taxpayer. Whether through direct funding of government workers or by supporting private corporations and union members through bailouts — it is the unfunded "legacy costs" that are crippling our country. So it makes no sense that we should expand the burden of taxpayers and the dangers to patients by completely turning over to government the reins of health care financing and ultimately, health care decisions.

Single payer health systems produce consistent results: rationing, waiting lines, better treatment for the well connected, escalating and unsustainable public expense, cookbook medicine and less patient satisfaction. Sadly, the vision for health system reform in D.C. will lead to the same outcomes because they seek to create a command and control structure over medical practice and payment decisions and to further expand third party payment for health care financing.

Many myths are commonly used to support a single payer system are well enumerated in the 2004 Book by John Goodman and Devron Herrick "Lives at Risk" (a summary of their findings is available at the Cato Institute.) One popular myth is that there is a "right to health care". But in Canada the Supreme Court recently overturned the ban on private insurance stating that "access to a waiting list is not access to health care." The U.S. Supreme Court has ruled that the Social Security program doesn't provide a guaranteed right to its retirement benefits; similar denial of Medicare rights is certainly justified since it is part of the Social Security Act.[1]

Some say quality is higher in socialized systems but technology and doctor time is limited and cancer survival rates are lower. Claims of lower infant mortality rates ignore that calculations in other countries don't include very low birth weight infants Americans try to save or babies that die within 24 hours after birth. Some believe that health care is made available on the basis of need instead of ability to pay when in fact the wealthy and well connected routinely "jump the queue" to get care. In England and France, it is the very existence of a private health care system next to the public system that allows many to receive care — after paying taxes for the care of others too. Many say we get half the recommended health care compared to other countries. In fact, such conclusions are based on pseudoscience. For instance, a democratic process is used to determine what is "recommended care", rather than science and for these studies, nurses performed hasty chart reviews of substandard records to look at a small number of patients for each care process.

Among the worst myths is that countries with single payer system hold down costs by avoiding administrative expenses. The fact is that these countries hold down costs by rationing. In Britain, the life saving breast cancer drug Herceptin is denied patients on the cold calculation that it is more expensive than the government approved $45,000 per "quality Adjusted Life Year." At one point, elderly patients there were required to go blind in one eye before receiving treatment for a visual disorder in the other (macular degeneration). There is also the soft rationing of people dying as they wait for heart surgery or for MRI's for their brain tumors. Further, most European countries with socialized medical systems have very limited defense budgets since they rely on the United States (see Of Paradise and Power, Robert Kagan, Knopf Publishers, 2003). Finally a close examination of the administrative cost myths reveals that government administrative costs are higher when one considers the costs of tax collection and enforcement, legacy costs of government workers, costs to citizens and society in productive time lost for delayed or denied care. In this nation there are now illness priority lists for health care spending in Oregon and nationally.

Many myths about American health care are being used to push greater public funding and greater third party control of health care. For instance, many claim that medical bankruptcy is common when it accounts for less than 5% of bankruptcies. Many believe that the uninsured use emergency rooms more while only 17 percent of ER visits are from uninsured patients. Insured Medicaid patients are far more frequent users of the E.R. than the uninsured.

Many claim that there are 46 million uninsured Americans when 9.7 million are not Americans, 16 million make more than $50,000, and 14 million are eligible for government programs leaving 8 million as chronically uninsured. The rate of uninsured in the U.S. is steady at about 15-16% since the early 90's. In Pennsylvania, about 92% are insured!

You are encouraged to closely analyze the insurance data from Pennsylvania. I have come to discover that Pennsylvania ranks 7th highest for number of insured patients and of the approximately 1.02 million uninsured in 2008, 53% were so for less than one year. Since 2002 there are about 100,000 fewer uninsured in Pennsylvania (Bureau of Labor and Statistics). Of those, 537,000 were eligible for government programs and 359,000 had incomes > $50,000. 91,000 were short term uninsured and that left only about 1.09% as long term uninsured (about 132,000 people). (References submitted with testimony). 58% state that the cost of insurance is the most important reason for being uninsured. Common causes of high insurance costs are laws that prevent purchase of insurance across state lines, or that require guaranteed issue or community rating of insurance rates. Under Guaranteed issue the sick can purchase insurance after they are sick and through community rating, the young and/or healthy face higher insurance costs to subsidize lower premiums for older and/or sicker patients. This drives the young away from insurance when they should have it for catastrophic care (further increasing the burden on public rolls if they become severely ill or injured). State mandate of insurance benefits is another common cause of increased cost. Many states require coverage not wanted by all such as chiropractic care, acupuncture or hair prosthesis — all with their own special interest lobby. Pennsylvania seems to have resisted this to a greater extent, but that will end under a single payer system.

Unfortunately, in Pennsylvania, the cost to an individual to purchase health insurance outside or the tax-advantaged workplace is the 5th highest in the nation. Those purchasing through small groups however see rates that are 29th in the nation. Some of the cause for the lower cost in the small group market may be the growth of Health Savings Accounts and High Deductible Health Plans (HSA/HDHP) which are now estimated at 20% across the nation. When small group plan members are offered a choice between traditional insurance and an HSA/HDHP model, 42% choose the later. Unfortunately, Pennsylvania appears to have about only 1.6% enrolled in these plans overall.

The State is to be commended for low rates of uninsured, but providing universal coverage should not be your goal. The goal should be to provide universal access to affordable health financing products that people need and desire. The HSA/HDHP model is an attractive means to meet this goal. Under this model, patients place funds into a tax-free health savings account to pay for the first $1,100 -$2,200 of their health care themselves (or more). This allows them to shop for higher quality and lower cost insurance and medical care and still be 100% covered when they have catastrophic problems above their HSA level. HSA/HDHP enrollees are more likely to participate in health and wellness programs and have higher success rates in smoking cessation, diet, fitness and overall health. 27% of new HSS/HDHP enrollees are previously uninsured, use the Emergency room 32% less and have premiums that are 15-20% lower. 84% of plans have first dollar coverage for preventative care and 45-49% of these enrollees have chronic conditions (negating the myths that such patients couldn't receive care with such coverage). 40% have incomes less than $60,000.

As you see, free markets characterized by competition and choice provide the lowest costs services at the highest level of quality. There will always be a role for a government safety net. But if the government becomes the means for covering all your citizens, there will be an overall lowering of the quality or care for all citizens and endless politicization of health care. Also, you will not be able to afford coverage for those who are truly poor.

You are cautioned to avoid current financing gimmicks under examination in Massachusetts such as an individual insurance mandate where public costs are running out of control, rationing boards are being created, and primary care doctors are hard to find — even as about 3% of their citizens remain uninsured while facing tax penalties. Also to be avoided are command and control structures such as pay for performance, public reporting of physician data, mandated electronic medical records and creation of health boards that create "best practices." These have been shown to have many unintended consequences such as avoidance of high risk patients, increased negative impact on minorities and lower income populations, gaming of the system to achieve higher scores, increase in inappropriate medical practices in some patients to achieve an overall higher score, and a failure to actually improve outcomes for patients. I would strongly encourage you to closely evaluate such programs prior to expansion (independent evaluation of Pay for Performance by this presenter included with reference material). I also strongly encourage you to set up strict reporting requirement for any government created program to see if any actual benefit has occurred using independent, unbiased consultants with reliable source data. It is also important to create a means for citizens to record complaints with any new government created health program designed to lower costs. Episodes of waiting, rationing, denied care, delayed care, patient dissatisfaction and the like should be recorded and reported publicly. Full judicial review rights for patients and their doctors should be allowed to ensure that their constitutional rights are not trampled in any system created or managed by the government.

Finally, as you consider further increasing the role of government in health care, you should consider whether your state budget can realistically handle it. This is especially true considering the increasing burdens on the Federal government and the decreasing likelihood they could provide rescue funding as you have budget shortfalls (as they are now doing in Massachusetts).

Pennsylvania is the cradle of our country's constitutional framework to protect individual liberty from intrusive government control. It should not be the place where individual liberty in health care is lost as a precedent for the entire nation. Please remember the importance and power of the free market as you continue your deliberations and its proven superiority at decreasing costs and increasing equity and access and quality.

5/12/2009: Five Useful Idiots by Mike Adams

http://townhall.com/columnists/MikeAdams/2009/05/12/five_useful_idiots?page=full&comments=true

There is a video that has been circulating around Facebook featuring me in a “dialogue” with several pro-abortion protestors from the socialist club at UMASS-Amherst. I’m glad the video is making the rounds. I generally like to use socialists to make my arguments look better by contrast. I’m also glad the students each helped illustrate a more specific point I’ve been making about socialists for years. These points follow in no particular order of importance:

1. Socialism and humor are incompatible. There’s nothing very funny about murdering 100 million people in 72 years. That is the true legacy of communism’s glory days. The gentleman in the black shirt who approached me at the beginning of this video provides a representative example of the demeanor of most socialists. His first question to me is “Do you have anything witty to say?” He turns to the camera later and asks “Do you guys actually think he’s like a funny person like humorous?” After the speech, he quoted a joke off my website and asked whether I thought it was funny. Here’s my response to the gentleman in the black shirt:

“Yes, I think I’m like a funny person like humorous.”

2. Socialists are dumb. The socialist woman in the glasses is a particularly useful idiot. During our brief confrontation she informed me that sperm is alive. She claimed that if I thought abortion was murder then I was also bound to believe that ejaculation and menstruation constitute murder. She was eventually hauled out of the auditorium by the police after screaming inaudibly while I was trying to speak. I think she was angry because of my response after she said they (the socialists) were going to overthrow us (the ruling class). I simply said, “I’ve got guns, you can’t overthrow me.”

Apparently, she was too dumb to understand why the police were able to haul her out of the auditorium: They had guns and she didn’t.

And, speaking of arrests …

3. Socialists are stuck in an arrested state of emotional development. Please take the time to check out the blonde with the scarf over her face. She kept saying, “It’s my body, my choice.” When I asked her why she was so angry, she said it was “her choice” to be angry. Just for fun, substitute the word “toy” for “choice” and you’ll see what I’m talking about.

“Keep your hands off my toy” becomes “Keep your laws of my body … my body, my choice!” twenty years later. The emphasis is always on their gain, not on another’s loss - “To me according to my need!”

4. Socialists suffer from attention deficit disorder. The gentleman who refused to shake my hand led the chant “Racist, sexist, anti-gay, right-wing bigots go away” when I spoke at UMass in 2006. This time he was hauled out of the auditorium for shouting over me during my speech and then refusing to say whether he was finished screaming. As the police dragged him away he just extended his middle finger.

When there is no substance to a tantrum one must assume it is just a ploy for attention. This generally comes from kids who were put into day-care too early and too often. The irony is that America’s move towards socialism drives up taxes, which forces mothers to work. This, in turn, forces kids into day care. This makes the kids seek attention by adopting political positions which happen to be chic (like socialism).

It is a vicious cycle indeed.

5. Socialists are morally outraged without any source of morality. Finally, there is the brunette girl in the black shirt seen throughout the video. She got up and gave her own speech after mine was over. She was angry and I asked her why. She replied by admitting she was angry because she found my opposition to abortion to be morally “reprehensible” - and she actually did use the word “reprehensible.” It is interesting that socialists believe that God needs to be done away with. Yet they still claim to have a basis for moral condemnation.

I’ve never heard a socialist explain how communism could be a universal and enduring system without a source of universal and enduring Truth. Chances are, neither have you.

Of course, none of these kids realize they provide such a good argument in favor of capitalism. Nor do they realize they have given me a great idea for a new promo for www.DrAdams.org. Thanks to my good friend Jim Weaver of Point Blank Advertising, we are now sending “I Hate Mike Adams” bumper stickers to those who make a contribution of $5 or more.

If you know a socialist who hates liberty, please give him an “I Hate Mike Adams” bumper stick today. When he puts that sticker on his old beat-up car – probably right next to “Obama 2008” – he won’t realize that he’ll be giving my website one helluva plug. Nor will he realize people will love what they read on my site just as much as he hates it.

As you can see, I believe we need to put our socialist idiots to work for us. It might be the only decent job they ever have.

5/11/2009: On Guns and Climate, the Elites Are Out of Touch by Michael Barone

Many years ago, political scientists came up with a theory that elites lead public opinion. And on some issues, they clearly do. But on some issues, they don't. Two examples of the latter phenomenon are conspicuous at a time when Barack Obama enjoys the approval of more than 60 percent of Americans and Democrats have won thumping majorities in two elections in a row. One is global warming. The other is gun control. On both issues, the elites of academe, the media and big business have been solidly on one side for years. But on both, the American public has been moving in the other direction.

Over the past decade, the Gallup organization has been asking Americans whether the seriousness of global warming is generally exaggerated or generally correct. From 1998 to 2007, except for the run-up to the 2004 election, they said it was generally serious by roughly a 2-1 margin -- 66 to 30 percent in 2006, for example. But in March 2009, that margin slipped to only 57 to 41 percent, with two-thirds of Republicans and nearly half of independents saying concern is exaggerated.

Similarly, last month, pollster Scott Rasmussen found that only 34 percent believes that global warming is caused by human activity, while 48 percent said it is caused by long-term planetary trends. That's almost exactly the opposite of what he found 12 months before -- 47 to 34 percent the other way around. However, 48 percent of the group Rasmussen calls the "Political Class" -- in other words, the elite -- continues to believe global warming is man-made.

On guns, Gallup has been testing opinion for many years on one extreme proposal that is the goal, usually unstated, of many gun-control advocates: banning the possession of handguns. Support was 60 percent in 1960 and 49 percent in 1965. It was as high as 43 percent in the early 1990s, before the Clinton Congress passed the so-called assault weapons ban. In March 2007, it had fallen to 29 percent -- a minority, almost a fringe position. In the early 1990s, Gallup found that Americans, by a 2-1 margin, favored stricter gun sale laws over less strict ones or keeping them the same. By fall 2008, they were evenly split.

Some of these shifts in opinion may be responses to events that liberal elites have not deigned to notice. Forty of the 50 states now have concealed weapons laws that allow law-abiding citizens to get permits to carry guns. Gun controllers predicted these would result in traffic shootouts and general mayhem. They haven't. It turns out that criminals are deterred from attacks less by gun-control laws than by the possibility that their intended victims may be armed. As for global warming, many Americans may have noticed that temperatures actually haven't been rising over the past decade, as global warming alarmists predicted. The elites are able to hire armed security guards and jet off on private jets, so they are less likely to notice these things.

I think there's something else at work here. For liberal elites, belief in gun control and global warming has taken on the character of religious faith. We have sinned (by hoarding guns or driving SUVs); we must atone (by turning in our guns or recycling); we must repent (by supporting gun control or cap and trade schemes). You may notice that the "we" in question is usually the great mass of ordinary American citizens.

The liberal elite is less interested in giving up its luxuries (Al Gore purchases carbon offsets to compensate for his huge mansion and private jet travel) than in changing the lifestyle of the masses, who selfishly insist on living in suburbs and keeping guns for recreation or protection. Ordinary Americans are seen not as responsible fellow citizens building stable communities but as greedy masses, who must be disciplined to live according to the elite's religious dogmas.

It should not be completely surprising that over time, these views have become less congenial to the masses, who are the object of such condescension. Democratic officeholders, who must live by the discipline of the ballot, have noticed. Party leaders did not press to re-enact the assault weapons ban when it expired and currently are flummoxed by the backbenchers who are resisting a cap and trade bill that would impose huge costs on those who use electricity. Elites may lead, but Americans do not always follow.

4/13/2009: Obama's Economic Mirage By Robert J. Samuelson

http://www.washingtonpost.com/wp-dyn/content/article/2009/04/12/AR2009041202261.html

President Obama has made no secret of his vision for America's 21st-century economy. We will lead the world in "green" technologies to stop global warming. Advancing medical breakthroughs will improve our well-being, control health spending and enable us to expand insurance coverage. These investments in energy and health care, as well as education, will revive the economy and create millions of well-paying new jobs for middle-class Americans.

It's a dazzling rhetorical vista that excites the young and fits the country's mood, which blames "capitalist greed" for the economic crisis. Obama promises communal goals and a more widely shared prosperity. The trouble is that it may not work as well in practice as it does in Obama's speeches. Still, congressional Democrats press ahead to curb global warming and achieve near-universal health insurance. We should not be stampeded into far-reaching changes that have little to do with today's crisis.

What Obama proposes is a "post-material economy." He would de-emphasize the production of ever-more private goods and services, harnessing the economy to achieve broad social goals. In the process, he sets aside the standard logic of economic progress.

Since the dawn of the Industrial Age, this has been simple: produce more with less. ("Productivity," in economic jargon.) Mass markets developed for clothes, cars, computers and much more because declining costs expanded production. Living standards rose. By contrast, the logic of the "post-material economy" is just the opposite: Spend more and get less.

Consider global warming. The centerpiece of Obama's agenda is a "cap-and-trade" program. This would be, in effect, a tax on fossil fuels (oil, coal, natural gas). The idea is to raise their prices so that households and businesses use less or switch to costlier "alternative" energy sources such as solar. In general, we would spend more on energy and get less of it.

The story for health care is similar, though the cause is different. We spend more and more for it (now 21 percent of personal consumption, says Brookings economist Gary Burtless) and get, it seems, less and less gain in improved health. This is largely the result of costly new technologies and the unintended consequence of open-ended insurance reimbursement that encourages unneeded tests, procedures and visits to doctors. Expanding health insurance might aggravate the problem. Many of today's uninsured get health care for free or don't need much because they're young (40 percent are between 18 and 34).

Together, health care and energy constitute about a quarter of the U.S. economy. If their costs increase, they will crowd out other spending. The president's policies might, as he says, create high-paying "green" or medical jobs. But if so, they will destroy old jobs elsewhere. Think about it. If you spend more for gasoline or electricity -- or for health insurance premiums -- then you spend less on other things, from meals out to home repair. Jobs in those sectors suffer.

The prospect is that energy and health costs may rise without creating much gain in material benefits. That's not economic "progress." Rebating households' higher energy costs (as some suggest) with tax cuts does not solve the problem of squeezed incomes. Given today's huge and unsustainable budget deficits, some other tax would have to be raised or some other program cut.

And collective benefits?

What defines the "post-material economy" is a growing willingness to sacrifice money income for psychic income -- "feeling good." Some people may gladly pay higher energy prices if they think they're "saving the planet" from global warming. Some may accept higher taxes if they think they're improving the health or education of the poor. Unfortunately, these psychic benefits may be based on fantasies. What if U.S. cuts in greenhouse gases are offset by Chinese increases? What if more health insurance produces only modest gains in people's health?

Obama and his allies have glossed over these questions. They've left the impression that somehow magical technological breakthroughs will produce clean energy that is also cheap. Perhaps that will happen; it hasn't yet. They've talked so often about the need to control wasteful health spending that they've implied they've actually found a way of doing so. Perhaps they will, but they haven't yet.

We cannot build a productive economy on the foundations of health care and "green" energy. These programs would create burdens for many, benefits for some. Indeed, their weaknesses may feed on each other, as higher health spending requires more taxes that are satisfied by stiffer terms for cap-and-trade. We clearly need changes in these areas: ways to check wasteful health spending and promote efficient energy use. I have long advocated a gasoline tax on national security grounds. But Obama's vision for economic renewal is mostly a self-serving mirage.

5/12/2009: Five Useful Idiots by Mike Adams

There is a video that has been circulating around Facebook featuring me in a “dialogue” with several pro-abortion protestors from the socialist club at UMASS-Amherst. I’m glad the video is making the rounds. I generally like to use socialists to make my arguments look better by contrast. I’m also glad the students each helped illustrate a more specific point I’ve been making about socialists for years. These points follow in no particular order of importance:

1. Socialism and humor are incompatible. There’s nothing very funny about murdering 100 million people in 72 years. That is the true legacy of communism’s glory days. The gentleman in the black shirt who approached me at the beginning of this video provides a representative example of the demeanor of most socialists. His first question to me is “Do you have anything witty to say?” He turns to the camera later and asks “Do you guys actually think he’s like a funny person like humorous?” After the speech, he quoted a joke off my website and asked whether I thought it was funny. Here’s my response to the gentleman in the black shirt:

“Yes, I think I’m like a funny person like humorous.”

2. Socialists are dumb. The socialist woman in the glasses is a particularly useful idiot. During our brief confrontation she informed me that sperm is alive. She claimed that if I thought abortion was murder then I was also bound to believe that ejaculation and menstruation constitute murder. She was eventually hauled out of the auditorium by the police after screaming inaudibly while I was trying to speak. I think she was angry because of my response after she said they (the socialists) were going to overthrow us (the ruling class). I simply said, “I’ve got guns, you can’t overthrow me.”

Apparently, she was too dumb to understand why the police were able to haul her out of the auditorium: They had guns and she didn’t.

And, speaking of arrests …

3. Socialists are stuck in an arrested state of emotional development. Please take the time to check out the blonde with the scarf over her face. She kept saying, “It’s my body, my choice.” When I asked her why she was so angry, she said it was “her choice” to be angry. Just for fun, substitute the word “toy” for “choice” and you’ll see what I’m talking about.

“Keep your hands off my toy” becomes “Keep your laws of my body … my body, my choice!” twenty years later. The emphasis is always on their gain, not on another’s loss - “To me according to my need!”

4. Socialists suffer from attention deficit disorder. The gentleman who refused to shake my hand led the chant “Racist, sexist, anti-gay, right-wing bigots go away” when I spoke at UMass in 2006. This time he was hauled out of the auditorium for shouting over me during my speech and then refusing to say whether he was finished screaming. As the police dragged him away he just extended his middle finger.

When there is no substance to a tantrum one must assume it is just a ploy for attention. This generally comes from kids who were put into day-care too early and too often. The irony is that America’s move towards socialism drives up taxes, which forces mothers to work. This, in turn, forces kids into day care. This makes the kids seek attention by adopting political positions which happen to be chic (like socialism).

It is a vicious cycle indeed.

5. Socialists are morally outraged without any source of morality. Finally, there is the brunette girl in the black shirt seen throughout the video. She got up and gave her own speech after mine was over. She was angry and I asked her why. She replied by admitting she was angry because she found my opposition to abortion to be morally “reprehensible” - and she actually did use the word “reprehensible.” It is interesting that socialists believe that God needs to be done away with. Yet they still claim to have a basis for moral condemnation.

I’ve never heard a socialist explain how communism could be a universal and enduring system without a source of universal and enduring Truth. Chances are, neither have you.

Of course, none of these kids realize they provide such a good argument in favor of capitalism. Nor do they realize they have given me a great idea for a new promo for www.DrAdams.org. Thanks to my good friend Jim Weaver of Point Blank Advertising, we are now sending “I Hate Mike Adams” bumper stickers to those who make a contribution of $5 or more.

If you know a socialist who hates liberty, please give him an “I Hate Mike Adams” bumper stick today. When he puts that sticker on his old beat-up car – probably right next to “Obama 2008” – he won’t realize that he’ll be giving my website one helluva plug. Nor will he realize people will love what they read on my site just as much as he hates it.

As you can see, I believe we need to put our socialist idiots to work for us. It might be the only decent job they ever have.

5/11/2009: On Guns and Climate, the Elites Are Out of Touch by Michael Barone

Many years ago, political scientists came up with a theory that elites lead public opinion. And on some issues, they clearly do. But on some issues, they don't. Two examples of the latter phenomenon are conspicuous at a time when Barack Obama enjoys the approval of more than 60 percent of Americans and Democrats have won thumping majorities in two elections in a row. One is global warming. The other is gun control. On both issues, the elites of academe, the media and big business have been solidly on one side for years. But on both, the American public has been moving in the other direction.

Over the past decade, the Gallup organization has been asking Americans whether the seriousness of global warming is generally exaggerated or generally correct. From 1998 to 2007, except for the run-up to the 2004 election, they said it was generally serious by roughly a 2-1 margin -- 66 to 30 percent in 2006, for example. But in March 2009, that margin slipped to only 57 to 41 percent, with two-thirds of Republicans and nearly half of independents saying concern is exaggerated.

Similarly, last month, pollster Scott Rasmussen found that only 34 percent believes that global warming is caused by human activity, while 48 percent said it is caused by long-term planetary trends. That's almost exactly the opposite of what he found 12 months before -- 47 to 34 percent the other way around. However, 48 percent of the group Rasmussen calls the "Political Class" -- in other words, the elite -- continues to believe global warming is man-made.

On guns, Gallup has been testing opinion for many years on one extreme proposal that is the goal, usually unstated, of many gun-control advocates: banning the possession of handguns. Support was 60 percent in 1960 and 49 percent in 1965. It was as high as 43 percent in the early 1990s, before the Clinton Congress passed the so-called assault weapons ban. In March 2007, it had fallen to 29 percent -- a minority, almost a fringe position. In the early 1990s, Gallup found that Americans, by a 2-1 margin, favored stricter gun sale laws over less strict ones or keeping them the same. By fall 2008, they were evenly split.

Some of these shifts in opinion may be responses to events that liberal elites have not deigned to notice. Forty of the 50 states now have concealed weapons laws that allow law-abiding citizens to get permits to carry guns. Gun controllers predicted these would result in traffic shootouts and general mayhem. They haven't. It turns out that criminals are deterred from attacks less by gun-control laws than by the possibility that their intended victims may be armed. As for global warming, many Americans may have noticed that temperatures actually haven't been rising over the past decade, as global warming alarmists predicted. The elites are able to hire armed security guards and jet off on private jets, so they are less likely to notice these things.

I think there's something else at work here. For liberal elites, belief in gun control and global warming has taken on the character of religious faith. We have sinned (by hoarding guns or driving SUVs); we must atone (by turning in our guns or recycling); we must repent (by supporting gun control or cap and trade schemes). You may notice that the "we" in question is usually the great mass of ordinary American citizens.

The liberal elite is less interested in giving up its luxuries (Al Gore purchases carbon offsets to compensate for his huge mansion and private jet travel) than in changing the lifestyle of the masses, who selfishly insist on living in suburbs and keeping guns for recreation or protection. Ordinary Americans are seen not as responsible fellow citizens building stable communities but as greedy masses, who must be disciplined to live according to the elite's religious dogmas.

It should not be completely surprising that over time, these views have become less congenial to the masses, who are the object of such condescension. Democratic officeholders, who must live by the discipline of the ballot, have noticed. Party leaders did not press to re-enact the assault weapons ban when it expired and currently are flummoxed by the backbenchers who are resisting a cap and trade bill that would impose huge costs on those who use electricity. Elites may lead, but Americans do not always follow.

4/13/2009: Obama's Economic Mirage By Robert J. Samuelson

President Obama has made no secret of his vision for America's 21st-century economy. We will lead the world in "green" technologies to stop global warming. Advancing medical breakthroughs will improve our well-being, control health spending and enable us to expand insurance coverage. These investments in energy and health care, as well as education, will revive the economy and create millions of well-paying new jobs for middle-class Americans.

It's a dazzling rhetorical vista that excites the young and fits the country's mood, which blames "capitalist greed" for the economic crisis. Obama promises communal goals and a more widely shared prosperity. The trouble is that it may not work as well in practice as it does in Obama's speeches. Still, congressional Democrats press ahead to curb global warming and achieve near-universal health insurance. We should not be stampeded into far-reaching changes that have little to do with today's crisis.

What Obama proposes is a "post-material economy." He would de-emphasize the production of ever-more private goods and services, harnessing the economy to achieve broad social goals. In the process, he sets aside the standard logic of economic progress.

Since the dawn of the Industrial Age, this has been simple: produce more with less. ("Productivity," in economic jargon.) Mass markets developed for clothes, cars, computers and much more because declining costs expanded production. Living standards rose. By contrast, the logic of the "post-material economy" is just the opposite: Spend more and get less.

Consider global warming. The centerpiece of Obama's agenda is a "cap-and-trade" program. This would be, in effect, a tax on fossil fuels (oil, coal, natural gas). The idea is to raise their prices so that households and businesses use less or switch to costlier "alternative" energy sources such as solar. In general, we would spend more on energy and get less of it.

The story for health care is similar, though the cause is different. We spend more and more for it (now 21 percent of personal consumption, says Brookings economist Gary Burtless) and get, it seems, less and less gain in improved health. This is largely the result of costly new technologies and the unintended consequence of open-ended insurance reimbursement that encourages unneeded tests, procedures and visits to doctors. Expanding health insurance might aggravate the problem. Many of today's uninsured get health care for free or don't need much because they're young (40 percent are between 18 and 34).

Together, health care and energy constitute about a quarter of the U.S. economy. If their costs increase, they will crowd out other spending. The president's policies might, as he says, create high-paying "green" or medical jobs. But if so, they will destroy old jobs elsewhere. Think about it. If you spend more for gasoline or electricity -- or for health insurance premiums -- then you spend less on other things, from meals out to home repair. Jobs in those sectors suffer.

The prospect is that energy and health costs may rise without creating much gain in material benefits. That's not economic "progress." Rebating households' higher energy costs (as some suggest) with tax cuts does not solve the problem of squeezed incomes. Given today's huge and unsustainable budget deficits, some other tax would have to be raised or some other program cut.

And collective benefits?

What defines the "post-material economy" is a growing willingness to sacrifice money income for psychic income -- "feeling good." Some people may gladly pay higher energy prices if they think they're "saving the planet" from global warming. Some may accept higher taxes if they think they're improving the health or education of the poor. Unfortunately, these psychic benefits may be based on fantasies. What if U.S. cuts in greenhouse gases are offset by Chinese increases? What if more health insurance produces only modest gains in people's health?

Obama and his allies have glossed over these questions. They've left the impression that somehow magical technological breakthroughs will produce clean energy that is also cheap. Perhaps that will happen; it hasn't yet. They've talked so often about the need to control wasteful health spending that they've implied they've actually found a way of doing so. Perhaps they will, but they haven't yet.

We cannot build a productive economy on the foundations of health care and "green" energy. These programs would create burdens for many, benefits for some. Indeed, their weaknesses may feed on each other, as higher health spending requires more taxes that are satisfied by stiffer terms for cap-and-trade. We clearly need changes in these areas: ways to check wasteful health spending and promote efficient energy use. I have long advocated a gasoline tax on national security grounds. But Obama's vision for economic renewal is mostly a self-serving mirage.

5/11/2009: from the Daily Reckoning

...At first, it seemed as if the feds had failed. Then, gradually, the light increased...the days grew longer.

And now, the mob screams: "The worst is over!" "We've seen the bottom." "Hoorah for the feds!"

But it is not likely to be so...

Here we give you the first of four Daily Reckoning dicta:

People do not get what they want or what they expect from the markets; they get what they deserve.

Of course, people would like the downturn to be over. Many are counting on it. But Mr. Market doesn't give a hoot. He's got a "Capitalism at Work" t-shirt on and a sledgehammer in his hand.

What's he up to? He's demolishing a quarter century's worth of mistakes. There are always mistakes made. Investments go bad. Businesses go under. People go broke. When many mistakes are corrected at once, it's called a 'recession.' And when an entire economic model goes bad, it's called a 'depression.'

The economic model of the last quarter century caused more mistakes than usual. It encouraged people to spend, borrow, and speculate. And each time Mr. Market tried to make some corrections, the authorities came along with more money and easier credit. Businesses that should have gone under years ago kept digging themselves in deeper. Homeowners kept running up more debt. Speculators kept taking bigger and bigger gambles. Altogether, total debt - a measure of the bubble in the credit markets and all things associated with it - rose from only about 150% of GDP when the Pontiac GTO came out, to 370% during the Hummer and Prius years.

Fish gotta swim, birds gotta fly, and bubbles gotta blow. The bubble in the financial sector - including subprime debt, housing prices, bonuses on Wall Street and derivatives - hit the fan in 2007. And what a mess!

And why shouldn't it be? Which brings us to the second of our dicta:

The force of a correction is equal and opposite to the deception that preceded it.

The delusions and absurdities of the Bubble Epoque were monstrous. Naturally, the correction must be huge too. World stock markets were nearly cut in half. Property prices too have been knocked down almost everywhere. The total loss of nominal wealth has been estimated as high as $50 trillion.

In today's paper, we find that Buffett's company, Berkshire Hathaway, made its first loss since 2001. Thirty-three banks have been shut down this year. America's leading banks say they need another $75 billion to keep their doors open. And Fannie Mae said it lost $23 billion; it will need $19 billion more to continue jiving the housing market.

Could these losses have been prevented?

Ah...certainly many of them could. If the U.S. Congress had never created Fannie Mae, for example, it never would have distorted the mortgage market as much as it did. And if the feds hadn't created the Federal Reserve Bank, it couldn't have provided so much ready money for so many speculators and borrowers. And if the Fed under Alan Greenspan had done what it was supposed to do - that is, to "take away the punch bowl" before the party got out of control - the bubble in the financial sector probably would have been much more modest.

Of course, people drew all the wrong conclusions. They thought "capitalism failed." They saw the car drive off the cliff...but didn't notice how government had twisted the road signs. Instead of warning investors of the dangerous curve ahead, the Fed's low lending rates said: 'Step on the gas!'

We all know the story from there...and Rob Parenteau has reason to believe that a replay of these events could be coming our way - and sooner than you think...

Dictum number 3: Capitalism doesn't always take an economy where it wants to go; but it always takes an economy where it ought to be.

Whoever was responsible for the mistakes, capitalism went about correcting them with its customary elan. It hit imprudent investors with trillions in losses. It knocked down mismanaged corporations. It whacked homeowners...and pounded housing-based derivatives to dust.

Capitalism operates by a process that the great economist Joseph Schumpeter called "creative destruction." It destroys mistakes to make room for new innovations and new businesses. Unfortunately, this puts it at odds with government...and what most people want. When people make mistakes, they maintain that they are blameless ("who could have seen this crisis coming?") and that someone else should pay for the loss.

So today, the feds, who mismanaged their regulatory responsibilities during the Bubble Epoque, are bailing out mismanaged corporations in order to protect lenders who mismanaged their money. They are determined to prevent capitalism from making major changes - in the worst possible way. What's the worst possible way? Simple. Leave the mismanagers in place. Keep the brain-dead companies alive - along with the zombie banks. Let the government take ownership of major sectors of the economy. And stick a debt-ridden society with even more debt! The feds are expected to borrow $2 trillion this year alone. From whom? And who will repay it?

We think you have a pretty good idea of who is going to end up footing the bill, dear reader. And we don't think you should take it sitting down...And the fourth dicta:

The severity of a depression is inversely correlated with government's efforts to stop it.

The more the feds try to delay and distract the process of creative destruction, the longer it takes to get the job done. And the higher the eventual bill.

There are only two fairly clear examples in modern history. After the crash of '29, the Hoover and Roosevelt administrations tried desperately to stop the correction. They could not make bad debts disappear, nor turn bad decisions into good ones. All they could do was to retard the necessary corrections - and cause new mistakes! It wasn't until after WWII, 15 years later, when the New Deal was largely forgotten, that the United States got back to work. Similarly, when Japan was confronted with a major correction in 1990, its politicians followed the Hoover/Roosevelt model. Over the years, an amount equivalent to almost an entire year's output was applied to recovery efforts. But all they did was to prevent and forestall the needed changes. Now, 19 years later, the Japanese economy is still in corrective mode.

Tomorrow...beware the suckers' rally...

5/11/2009: An Easily Understandable Explanation of Derivative Markets:

Heidi is the proprietor of a bar in Detroit. She realizes that virtually all of her customers are unemployed alcoholics and, as such, can no longer afford to patronize her bar. To solve this problem, she comes up with new marketing plan that allows her customers to drink now, but pay later.

She keeps track of the drinks consumed on a ledger (thereby granting the customers loans).

Word gets around about Heidi's "drink now, pay later" marketing strategy and, as a result, increasing numbers of customers flood into Heidi's bar. Soon she has the largest sales volume for any bar in Detroit.

By providing her customers' freedom from immediate payment demands, Heidi gets no resistance when, at regular intervals, she substantially increases her prices for wine and beer, the most consumed beverages. Consequently, Heidi's gross sales volume increases massively.

A young and dynamic vice-president at the local bank recognizes that these customer debts constitute valuable future assets and increases Heidi's borrowing limit. He sees no reason for any undue concern, since he has the debts of the unemployed alcoholics as collateral.

At the bank's corporate headquarters, expert traders transform these customer loans into DRINKBONDS, ALKIBONDS and PUKEBONDS. These securities are then bundled and traded on international security markets. Naive investors don't really understand that the securities being sold to them as AAA secured bonds are really the debts of unemployed alcoholics.

Nevertheless, the bond prices continuously climb, and the securities soon become the hottest-selling items for some of the nation's leading brokerage houses.

One day, even though the bond prices are still climbing, a risk manager at the original local bank decides that the time has come to demand payment on the debts incurred by the drinkers at Heidi's bar. He so informs Heidi.

Heidi then demands payment from her alcoholic patrons, but being unemployed alcoholics they cannot pay back their drinking debts. Since, Heidi cannot fulfill her loan obligations she is forced into bankruptcy. The bar closes and the eleven employees lose their jobs.

Overnight, DRINKBONDS, ALKIBONDS and PUKEBONDS drop in price by 90%. The collapsed bond asset value destroys the banks liquidity and prevents it from issuing new loans, thus freezing credit and economic activity in the community.

The suppliers of Heidi's bar had granted her generous payment extensions and had invested their firms' pension funds in the various BOND securities. They find they are now faced with having to write off her bad debt and with losing over 90% of the presumed value of the bonds. Her wine supplier also claims bankruptcy, closing the doors on a family business that had endured for three generations, her beer supplier is taken over by a competitor, who immediately closes the local plant and lays off 150 workers.

Fortunately though, the bank, the brokerage houses and their respective executives are saved and bailed out by a multi-billion dollar no-strings attached cash infusion from the Government. The funds required for this bailout are obtained by new taxes levied on employed, middle-class, non-drinkers.

Now, do you understand?

Even David Letterman says something profound once in a while:

"It's that time of year again — graduation. Remember, the Ivy League graduate of today is the Olive Garden waiter of tomorrow."

Finish Every Day by Ralph Waldo Emerson
[from a letter to his daughter]

Finish every day and be done with it.
You have done what you could.
Some blunders and absurdities no doubt have crept in;
forget them as soon as you can.

Tomorrow is a new day; begin it well and serenely and
with too high a spirit to be cumbered with your old nonsense.
This day is all that is good and fair.
It is too dear, with its hopes and invitations, to waste a moment on yesterdays.

Survival Optional by Thomas Sowell

It used to be said that self-preservation is the first law of nature. But much of what has been happening in recent times in the United States, and in Western civilization in general, suggests that survival is taking a back seat to the shibboleths of political correctness.

We have already turned loose dozens of captured terrorists, who have resumed their terrorism. Why? Because they have been given "rights" that exist neither in our laws nor under international law.

These are not criminals in our society, entitled to the protection of the Constitution of the United States. They are not prisoners of war entitled to the protection of the Geneva Convention.

There was a time when people who violated the rules of war were not entitled to turn around and claim the protection of those rules. German soldiers who put on U.S. military uniforms, in order to infiltrate American lines during the Battle of the Bulge, were simply lined up against a wall and shot.

Nobody even thought that this was a violation of the Geneva Convention. American authorities filmed the mass executions. Nobody dreamed up fictitious "rights" for these enemy combatants who had violated the rules of war. Nobody thought we had to prove that we were nicer than the Nazis by bending over backward.

Bending over backward is a very bad position from which to try to defend yourself. Nobody in those days confused bending over backward with "the rule of law," as Barack Obama did recently. Bending over backward is the antithesis of the rule of law. It is depriving the people of the protection of their laws, in order to pander to mushy notions among the elite.

Even under the Geneva Convention, enemy soldiers have no right to be turned loose before the war is over. Terrorists— "militants" or "insurgents" for those of you who are squeamish— have declared open-ended war against America. It is open-ended in time and open-ended in methods, including beheadings of innocent civilians.

President Obama can ban the phrase "war on terror" but he cannot ban the terrorists' war on us. That war continues, so there is no reason to turn terrorists loose before it ends. They chose to make it that kind of war. We don't need to risk American lives to prove that we are nicer than they are.

The great Supreme Court justice Oliver Wendell Holmes said that law is not some "brooding omnipresence in the sky." It is a set of explicit rules by which human beings structure their lives and their relationships with one another.

Those who choose to live outside those laws, whether terrorists or pirates, can be— and have been— shot on sight. Squeamishness is neither law nor morality. And moral exhibitionism is beneath contempt, when it sacrifices the safety of those who live within the law for the sake of self-satisfied preening, whether in editorial offices or in the White House.

As if it is not enough to turn cutthroats loose to cut throats again, we are now contemplating legal action against Americans who wrung information about international terrorist operations out of captured terrorists.

Does nobody think ahead to what this will mean— for many years to come— if people trying protect this country from terrorists have to worry about being put behind bars themselves? Do we need to have American intelligence agencies tip-toeing through the tulips when they deal with terrorists?

In his visit to CIA headquarters, President Obama pledged his support to the people working there and said that there would be no prosecutions of CIA agents for prior actions. Then he welshed on that in a matter of hours by leaving the door open for such prosecutions, which the left has been clamoring for, both inside and outside of Congress.

Repercussions extend far beyond issues of the day. It is bad enough that we have a glib and sophomoric narcissist in the White House. What is worse is that whole nations that rely on the United States for their security see how easily our president welshes on his commitments. So do other nations, including those with murderous intentions toward us, our children and grandchildren.

5/5/2009: HOW I BECAME A LIBERTARIAN by MICHAEL SHERMER

In reading through the many critical comments in response to my occasional foray into issues political and economic, readers seem to think that there are two Michael Shermers: Mr. Rational Skeptic and Mr. Kooky Libertarian. I will respond to the specific comments, but let me say at the outset that I do appreciate your skepticism of my libertarian beliefs (hey, we should be skeptical of the skeptics, or else we’re not true skeptics, right?!). Perhaps if I provided some background to how I became a Libertarian you can see that there is just one Michael Shermer, and even if you still disagree with my economics, you’ll at least understand where I’m coming from. And do remember that we libertarians are social liberals just like you (I’m presuming that the vast majority of readers of Skeptic, eSkeptic, and Skepticblog are liberals, which itself is a troubling bias in our readership that I’ll address another time). In the meantime…

In the mid-1970s I was an undergraduate at Pepperdine University, a Church of Christ institution with a strong conservative bent at a time when liberals ruled academe. I matriculated there because I was an evangelical Christian who wanted to be a college professor, so theology seemed like the most appropriate field and Pepperdine had a strong theology department (it didn’t hurt that the campus is located in the majestic Malibu hills overlooking the Pacific Ocean). But I soon discovered that in order to earn a Ph.D. in theology one had to master four dead languages — Hebrew, Greek, Latin, and Aramaic — and since I found even Spanish to be taxing, this made my career choice problematic. When my advisors also warned me about the questionable university job market for theologians, I switched to psychology, where I discovered the language of science, which I both enjoyed and mastered. Theology is based on logical analysis, philosophical disputation, and literary deconstruction. Science is founded on empirical data, statistical analysis, and theory building. To me, the latter seemed like a better method to tell the difference between what is real and what is not, what works and what doesn’t, and in any case meshed will with my cognitive style of thinking — for whatever reason, I can sort through data sets and scientific charts much better than I can logical syllogisms and thought experiments.

My introduction to economics came in my senior year when many of the students in the psychology department were reading a cinderblock of a book entitled Atlas Shrugged, by the novelist-philosopher Ayn Rand. I had never heard of the book or the author, and the novel’s size was so intimidating that I refused to join the ranks of the enthused for months, until social pressure pushed me into taking the plunge. I trudged through the first hundred pages (patience was strongly advised) until the gripping mystery of the man who stopped the motor of the world swept me through the next thousand pages.

I found Atlas Shrugged to be a remarkable book, as so many have. In fact, in 1991 the Library of Congress and the Book of the Month Club surveyed readers about books that “made a difference” in their lives. Atlas Shrugged was rated second only to the Bible.1 What scientist or scholar wouldn’t find resonance with proclamations such as this: “Man cannot survive except by gaining knowledge, and reason is his only means to gain it. Reason is the faculty that perceives, identifies and integrates the material provided by his senses. The task of his senses is to give him the evidence of existence, but the task of identifying it belongs to his reason, his senses tell him only that something is, but what it is must be learned by his mind.”2 Rand’s philosophy of Objectivism was so compelling that it took me two decades to discover what I consider to be the shortcomings in its founding principles, which Rand once outlined (“while standing on one foot”) as: 1. Metaphysics: Objective Reality; 2. Epistemology: Reason; 3. Ethics: Self-interest; 4. Politics: Capitalism.3 I am most troubled by Rand’s theory of human nature as wholly selfish and competitive, defined in Atlas through the famous “oath” pronounced by the novel’s heroes: “I swear — by my life and my love of it — that I will never live for the sake of another man, nor ask another man to live for mine.” Science now shows us that, in fact, in addition to being selfish, competitive, and greedy, we also harbor a great capacity for altruism, cooperation, and charity, the evidence for which is now overwhelming from a variety of fields from anthropology to neuroscience. But reading Rand, and absorbing the logic of her case for economic freedom and political liberty (she called herself a “radical for capitalism”), led me to the extensive body of work on the science of markets and economies and the philosophy of liberty and freedom, all of which resonated deeply with my personality and temperament.

I cannot say for certain whether it was the merits of free market economics and fiscal conservatism (which are considerable) that convinced me of its veracity, or if it was my disposition that reverberated so well with its cognitive style. As it is for most belief systems we hold, it was probably a combination of both. I was raised by parents who could best be described as fiscally conservative and socially liberal, which today would be called libertarian, but there was no such label when they were coming of age in the 1940s and 1950s. Products of the depression and motivated by the fear of returning to abject poverty, my parents skipped college and worked full time well into their later years. Throughout my childhood I was inculcated with the fundamental principles of economic conservatism: hard work, personal responsibility, self-determination, financial autonomy, small government, and free markets. Even though they were not in the least religious (as so many conservatives are today), my parents were exceedingly generous to those who were less fortunate — greed is good, but so too is charity.

After Pepperdine, I began a graduate program in experimental psychology at California State University, Fullerton, by which time I had abandoned my religious faith and embraced in its stead the secular values of the Enlightenment and the rigorous methods and provisional truths of science.4 But after two years of enticing rats to press bars in proportion to the frequency and intensity of the reinforcements we gave them, my enthusiasm for practicing this type of science waned while my wonderlust for the real world waxed.5 I went to the campus career development office and inquired what I might do for a living with a Master’s degree. “What are you educated to do?” they inquired. “Train rats,” I replied sardonically. “What else can you do?” they persisted. “Well,” I searched, “I can research and write.” The employment book included a job description for research and writing at Bicycle Dealer Showcase, the trade magazine of the bicycle industry, about which I knew nothing. My first assignment was to attend a press conference hosted by Cycles Peugeot and Michelin Tires in honor of John Marino, a professional bicycle racer who broke the transcontinental record from Los Angeles to New York. I fell in love with the sport, entering my first race that weekend, and for the next two years I learned the business of publishing and the sport of cycling. I wrote articles, sold advertisements, and rode my bike as far and as fast as I could. At the end of 1981 I left the magazine to race full time, supported by corporate sponsors and an adjunct professor’s salary from teaching psychology at Glendale College.

One day in 1981, Marino and I were on a long training ride during which he told me about Andrew Galambos, a retired physicist teaching private courses through his own Free Enterprise Institute, under an umbrella field he called “Volitional Science.” The introductory course was called V-50. This was Econ 101 on free market steroids, an invigoratingly muscular black-and-white world where Adam Smith is good, Karl Marx bad; individualism is good, collectivism bad; free economies are good, mixed economies are bad. The course was popular in Orange County, California (labeled by our neighbors in L.A. County as the “Orange Curtain”), and the time was right with Ronald Reagan as President and conservatives on the ascendant. Where Rand advocated for limited government, Galambos proffered a theory in which everything in society would be privatized until government simply falls into disuse and disappears. Galambos defined freedom as “the societal condition that exists when every individual has full (i.e. 100%) control over his own property,” and a free society as one where “anyone may do anything that he pleases — with no exceptions — so long as his actions affect only his own property; he may do nothing which affects the property of another without obtaining consent of its owner.” Galambos identified three types of property: primordial (one’s life), primary (one’s thoughts and ideas), and secondary (derivatives of primordial and primary property, such as the utilization of land and material goods). Thus, Galambos defined capitalism as “that societal structure whose mechanism is capable of protecting all forms of private property completely.” To realize a truly free society, then, we have merely “to discover the proper means of creating a capitalist society.” In this free society, we are all capitalists.6

Galambos had a massive ego that propelled him to a successful career as a private lecturer, but led him to such ego-inflating pronouncements as his classification of all sciences into physical, biological, and his own “volitional sciences.” His towering intellect took him to great heights of interdisciplinary creativity, but often left him and his students tangled up in contradictions, as when we all had to sign a contract promising that we would not disclose his ideas to anyone, while we were also inveigled to solicit others to enroll. (“You’ve got to take this great course.” “What’s it about?” “I can’t tell you.”) And he had a remarkable ability to lecture for hours without notes in an entertainingly colloquial style, but when two hours stretched into three, and three hours dragged into four, his audiences were never left wanting for more. Most problematic, however, was any hope of translating theory into practice, which is where the rubber meets the road for any economic or political principle. Property definitions are all well and good, but what happens when we cannot agree on property rights infringements? The answer was inevitably something like this: “in a truly free society all such disputes will be peacefully resolved through private arbitration.” Sounds good in theory, but turning theory into practice is never as easy as it sounds in the theory stage.

Nevertheless, I stuck it out to the end, learning more in that one course than I learned in dozens of college courses, absorbing the principles and attempting to apply them in both the academic and business worlds, which I straddled for many years. Marino and I (and our cycling partner Lon Haldeman) turned our cycling passion into a business by founding Race Across America, Inc., with corporate sponsors and a contract from ABC Sports, as well as the nonprofit sanctioning body, Ultra-Marathon Cycling Association. Several appearances on Wide World of Sports gave me the additional recognition and confidence to open Shermer Cycles, a bicycle shop in Arcadia, California. Meanwhile, I expanded my teaching duties by creating new courses in evolutionary theory and the history of ideas at Glendale College.7

Galambos had a protégé named Jay Stuart Snelson, whom I met shortly after taking V-50. Snelson taught courses at the Free Enterprise Institute, but after a falling out with Galambos (a common occurrence in Galambos’ social sphere that also plagued Ayn Rand), Snelson founded his own Institute for Human Progress. To distance himself from Galambos, Snelson’s theory of a free market society was built on the shoulders of what is known as the Austrian School of Economics, most notably the work of the Austrian economist Ludwig von Mises. Mises’ most important work was Human Action, and Snelson’s course was self-consciously built upon it, as gleaned from its title, Principles of Human Action. Snelson demonstrated through a series of scientific principles and historical examples that free market capitalism is unquestionably the most effective means of “optimizing peace, prosperity, and freedom.” As Snelson explained, outlining the countless and varied governmental actions that attenuate freedom: “Freedom exists where the individual’s discretion to choose is not confiscated by interventionism. The free market exists where people have the unrestricted freedom to buy and sell.” Although thieves, thugs, muggers, and murderers confiscate our freedoms, congressmen, senators, governors, and presidents restrict our freedoms on a scale orders of magnitude greater than all private criminals combined. And they do so, Snelson showed, with the best of intentions, because they believe that the “confiscation of the people’s freedom to choose will achieve the greatest satisfaction for the greatest number.” With such good intentions, and the political power to enforce them, states have intervened in business, education, transportation, communications, health services, environmental protection, crime prevention, free trade overseas, and countless other areas.

How these services could all be successfully privatized was the primary thrust of Snelson’s work. He believed that the social system that optimizes peace, prosperity, and freedom is one “where anyone at any time can choose to produce or provide any product or service, hire any employee, choose any production, distribution, or sales site, and offer to sell products or services at any price.” The only allowable restrictions are from the market itself. So employed, systematically throughout the world, a free market society would, as a plaque posted at the Panama Canal (that also served as the Institute’s motto) proclaims, Aperire Terram Gentibus, “to open the world to all people.”

These were heady words for a heady time in my life before formal commitments to career and family were congealed. For several years I taught Snelson’s principles course, along with my own courses on the history of science and the history of war. I also developed a monthly discussion group called the “Lunar Society” — after the famous 18th-century Lunar Society of Birmingham — centered on books such as Human Action. As a social scientist in search of a research project, I accepted Ludwig von Mises’ challenge: “One must study the laws of human action and social cooperation as the physicist studies the laws of nature.” We were going to build a new science, and out of that science we would build a new society. I even penned a “Declaration of Freedom” and a speech entitled “I have a Dream II.” What could be grander?!

Well, as Yogi Berra once said: “In theory, there is no difference between theory and practice. In practice there is.” I soon discovered that Berra’s principle applies in spades to the economic sphere. We live in a world rather different from that envisioned by my visionary mentors, so I turned my attention to the writings of economists from the Austrian School, and their protégés at the University of Chicago, who were decidedly becoming more mainstream in the 1980s as the country began a systematic shift toward the right.

In 1987 I decided that if I wanted to make an impact on the world through ideas I was going to have to give up my competitive cycling career and complete my graduate studies. I switched fields from psychology to the history of science, and in 1991 I graduated from Claremont Graduate School with a Ph.D., the union card and entrée into academe and professional science. I began teaching at Occidental College, a prestigious four-year liberal arts college in Los Angeles, where I discovered that 1960’s-style liberalism was still thriving. As a young faculty member without tenure, I kept my libertarian mouth shut, and on the weekends joined Jay Snelson in teaching seminars on free market economics at his Institute.

Through Snelson’s institute, and the ideas proffered by the Austrian and Chicago schools, I found a scientific foundation for my economic and political preferences. The founders of the Austrian and Chicago schools of economics penned a number of books and essays whose ideas burned into my brain a clear understanding of right and wrong human action in the sphere of economics. One especially influential essay on my thinking was the wickedly raffish The Petition of the Candlemakers, by Frédéric Bastiat, in which the French economist and social commentator satirizes special interest groups, in this case candlemakers, who petition the government for special favors:

We are suffering from the ruinous competition of a foreign rival who apparently works under conditions so far superior to our own for the production of light, that he is flooding the domestic market with it at an incredibly low price…. This rival … is none other than the sun…. We ask you to be so good as to pass a law requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains, casements, bull’s-eyes, deadlights and blinds; in short, all openings, holes, chinks, and fissures.

Bastiat also taught me the difference between what is seen and what is not seen when governments intervene in the marketplace. A public-works bridge, for example, is seen by all and appreciated by its users; what is not seen are all the products that would have been produced by the monies that were taxed out of private hands in order to finance the public project. It is not just that individual liberties are violated whenever governments interfere with freedom of choice in the economic realm, but that, in fact, the net result is a loss not just for the individuals, but for the collective for which the government action was originally intended.

I read Friedrich Hayek’s The Constitution of Liberty and The Road to Serfdom, I absorbed Henry Hazlitt’s Economics in One Lesson, an exceptional summary of free market economics, and I found Milton Friedman’s Free to Choose to be one of the clearest expositions of economic theory ever penned, and his PBS documentary series by the same name — introduced by the most muscular libertarian in history, Arnold Schwarzenegger — was so powerful that I purchased the series on video and watched the episodes over and over. And first among equals in the giants of libertarian thought who most shaped my thinking was Ludwig von Mises, the spiritus rector of the modern libertarian movement, most notably his magisterial work Human Action.8 Mises’ story is as instructive as it is inspirational. Mises was born in 1881 within the then powerful Austro-Hungarian Empire, and studied law and economics at the University of Vienna under Friedrich von Wieser and Eugen von Böhm-Bawerk, both followers of Carl Menger, the founder of the Austrian School of Economics. After serving as an artillery officer on the Russian front in World War I, Mises earned international recognition for his first major book, Socialism, where he spelled out the problems with “economic calculation” in a planned socialist economy. In capitalism, prices are determined from below by individuals freely exchanging in the marketplace and are in constant flux; in socialism, prices are determined from above by government fiat and are slow to change. In fact, Mises demonstrated that socialist economies depend on capitalist economies to determine what prices should be assigned. And they do so cumbersomely.9

In March, 1938, Hitler marched into Vienna, and Mises promptly marched out to the United States, where he began his long and lonely struggle against economic and political tyranny, a lone advocate of freedom in an increasingly socialistic society. The problem, Mises argued, is that interventionism leads to more interventionism. If you can intervene to protect individuals from dangerous drugs, for example, what about dangerous ideas? The following passage resonated with me because his analogue from the physical to the ideological is so effective in conveying the central message of freedom and liberty:

Opium and morphine are certainly dangerous and habit forming drugs. But once a principle is admitted that it is the duty of government to protect the individual against his own foolishness, no serious objections can be advanced against further encroachments. A good case could be made out in favor of the prohibition of alcohol and nicotine. And why limit the government’s benevolent providence to the protection of the individual’s body only? Is not the harm a man can inflict on his mind and soul even more disastrous than bodily evils? Why not prevent him from reading bad books and seeing bad plays, from looking at bad paintings and statues and from hearing bad music?10

At the end of almost 900 pages of mind-opening economic revelations, Mises concludes Human Action triumphantly:

The truth is that capitalism has not only multiplied population figures but at the same time improved the people’s standard of living in an unprecedented way. Neither economic thinking nor historical experience suggest that any other social system could be as beneficial to the masses as capitalism. The results speak for themselves. The market economy needs no apologists and propagandists. It can apply to itself the words of Sir Christopher Wren’s epitaph in St. Paul’s: Si monumentum requires, circumspice. [“If you seek his monument, look around.”]11

Although capitalism may not need apologists and propagandists, it does need a scientific foundation. In this sense, then, my entire career has been building toward this project, and my tenth book, The Mind of the Market, lays down a scientific foundation for capitalism through three new sciences: behavioral economics, neuroeconomics, and evolutionary economics. It is my goal now to continuing construction on the libertarian edifice, and perhaps one day even attempt to translate theory into practice through politics … libertarian politics of course.

Endnotes

^2 After the Bible and Atlas Shrugged were The Road Less Traveled by M. Scott Peck, To Kill a Mockingbird by Harper Lee, The Lord of the Rings by J.R.R. Tolkien, Gone With the Wind by Margaret Mitchell, How to Win Friends and Influence People by Dale Carnegie, The Book of Mormon, The Feminine Mystique by Betty Friedan, A Gift from the Sea by Anne Morrow Lindbergh, Man’s Search for Meaning by Victor Frankl, Passages by Gail Sheehy, and When Bad Things Happen to Good People by Harold S. Kushner.

^2 Rand, Ayn. 1957. Atlas Shrugged. New York: Random House, p. 1016.

^3 In my 1997 book, Why People Believe Weird Things, I devoted a chapter to the cult-like following that developed around Rand and her philosophy (“The Unlikeliest Cult in History” I called it), in an attempt to show that extremism of any kind, even the sort that the eschews cultish behavior, can become irrational. I cited the description of Rand’s inner circle by Nathaniel Branden, Rand’s chosen intellectual heir, where he listed the central tenets to which followers were to adhere, including: “Ayn Rand is the greatest human being who has ever lived. Atlas Shrugged is the greatest human achievement in the history of the world. Ayn Rand, by virtue of her philosophical genius, is the supreme arbiter in any issue pertaining to what is rational, moral, or appropriate to man’s life on earth. No one can be a good Objectivist who does not admire what Ayn Rand admires and condemn what Ayn Rand condemns. No one can be a fully consistent individualist who disagrees with Ayn Rand on any fundamental issue.” (Branden, Nathaniel. 1989. Judgment Day: My Years With Ayn Rand. Boston: Houghton Mifflin, pp. 255-256.) Many of the characteristics of a cult, in fact, seemed to fit what the followers of Objectivism believed, most notably veneration of the leader, belief in the inerrancy and omniscience of the leader, and commitment to the absolute truth and absolute morality as defined by the belief system.

^4 My religious conversion and deconversion are recounted in Shermer, Michael. 2000. How We Believe: Science, Skepticism, and the Search for God. New York: Henry Holt/Times Books.

^5 Shermer, Michael. 1978. Choice in Rats as a Function of Reinforcer Intensity and Quality. “A Thesis Presented to the Faculty of California State University, Fullerton, in Partial Fulfillment of the Requirements for the Degree Master of Arts in Psychology.” I was testing the “matching law,” which predicts that organisms will apportion behaviors in direct relation to payoffs; in our experiment, for example, a 16 percent sucrose reinforcement (sugar water) on the left bar should produce twice as many bar presses as the 8 percent sucrose reinforcement on the right bar. It almost did, requiring a slight modification to the matching law equation. I had a hard time seeing how I was going to change the world doing this kind of science.

^6 Galambos never published his long-promised book in his lifetime, so my summary of his theory comes from my own extensive notes from the V-50 class, and a series of three-by-five leaflets he printed called “Thrust for Freedom,” numbered sequentially and presenting the definitions quoted here. In 1999, Galambos’ estate issued Vol. 1 of Sic Itur Ad Astra (The Way to the Stars), a 942-page tome published by The Universal Scientific Publications Company, Inc. Galambos’ dream was to be a space entrepreneur and fly customers to the moon. In his logic, in order to realize this dream he believed that space exploration had to be privatized, which meant that society itself, in its entirety, would have to be privatized.

^7 I recount my cycling experiences and the founding of the Ultra-Marathon Cycling Association and the Race Across America in: Shermer, Michael. 1985. Sport Cycling. Chicago: Contemporary Books; and in Shermer, Michael. 1989. Race Across America: the Agonies and Glories of the World’s Longest and Cruelest Bicycle Race. Waco, TX: WRS Publishing.

^8 Bastiat, Frédéric. 1995. “The Petition of the Candlemakes” and “What is Seen and What is Not Seen,” in Selected Essays on Political Economy. George B. de Huszar, ed. Irvington-on-Hudson, N.Y.: Foundation for Economic Education.

Hayek, F. A. 1944. The Road to Serfdom. Chicago: University of Chicago Press.

Hayek, F. A. 1960. The Constitution of Liberty. Chicago: University of Chicago Press.

Hazlitt, Henry. 1946 (1979). Economics in One Lesson. New York: Harper and Brothers.

Friedman, Milton. 1980. Free to Choose: A Personal Statement. New York: Harcourt.

Mises, Ludwig von. 1949 (1966). Human Action, 3rd ed. Chicago: Contemporary Books.

^9 Mises, Ludwig von. 1981. Socialism. Indianapolis: Liberty Classics. See also: Rothbard, Murray. 1980. The Essential Ludwig von Mises. Auburn, AL: The Ludwig von Mises Institute of Auburn University.

^10 Ibid., p. 860.

^11 Ibid., p. 854.