Elkhorn Creek Lodge

Socialized Medicine; Stiffing II

Posted in economics, medical by mountainmusings on May 11, 2009

Here’s the report from the Fox News web site.  And here.  A coalition of health care leaders will present a program to “save” two trillion dollars over the next ten years; thereby making Obama’s health care reform fiscally possible by reducing the up-front costs.  What this really is is crony capitalism.  These players get a place at the table, and a cut in the profits.  In exchange, they will do what everyone in government is unwilling to say–ration.

In going to the nirvana of single payer health care, the government is going to take over the private sector to the tune of one trillion dollars per year.  Of the two or so trillions dollars that make up 18 percent of the GDP, the share that is spent on health care, about 45 percent is already tied up in governmental medical programs.  The rest, in the private sector, is what takes care of the rest of us.  And, through cost shifting and unfunded mandates, props up the shortfalls of the governmental sector.  

There is no such thing as “uninsured.”  Thanks to EMTALA (emergency medical treatment and active labor act), you can walk into any emergency room and must be seen, evaluated and deemed “stabilized” regardless of ability to pay–even if you’re an illegal immigrant.  Whether, you show up for a cold or you show up, flat on your back, having just smeared your face over a mile of interstate after wrecking your motorcycle, drunk.  In fact, so 50 percent of emergency visits are gratis thanks to EMTALA.  The fact is, once the private sector is consumed by the government for matters medical, the government will formally own all of those mandates.  That trillion dollars that will be confiscated by the single payer government program is already accounted for.  It will be a recurring cost, above and beyond the current Medicare/Medicaid tab, forever.

So, two trillion divided by ten means that we have to come up with 200 billion dollars of “savings” for the next ten years.  This is assuming that the profligate spending and loose monetary policy doesn’t ignite a round of inflation like that of the 1970’s.  

What this savings really means is there will be an effort to forgo 200 billion dollars of medical care each year.  For hospitals, forgoing expansions and modernizations.  Forgo new investments in equipment.  And certainly, no acquisitions of technology to push into new treatments; since we can’t have even more cost with even newer medical techniques.

But, I don’t know how our hospitals are going to turn down nurses who want raises to cope with rising tax and inflation burdens.

For the pharmaceutical companies; new drugs cost a billions dollars or more to bring to market.  You can kiss drugs with limited applications goodbye, the so-called orphan drugs.  There have been incredible breakthroughs for myriads of diseases; but at a price.  People griping about these new medicines forget that many have replaced surgery or offered a treatment where heretofore there was none.  Welcome to the brave new world of none.  Most of these big drug companies have their fingers in the manufacture and distribution of generics.  I suspect that emphasizing generics rather than innovation will be the new business model for Barry O’s brave new world of single payer health care.

Insurance companies?  They just hired themselves out as the price enforcers.  They, not their governmental overlords, will take the heat for poor reimbursement rates and care denials.  All to keep our politicians accountability-free.  They’ll make a nice profit at being the fall guy.

And the doctors.  Well, you can get free care right now by walking into any emergency room.  It’s required by law.  You’ll also wait 12 hours to get seen.  Only, now the waiting will extend to every clinic and doctor’s office in the land.  

Ration.  That’s the real deal being cut between these health care players and the administration.  Protected turf in exchange for taking the fall for rationing.

 

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Socialized Medicine; Stiffing and Snuffing

Posted in economics, medical by mountainmusings on May 10, 2009

A few thoughts about Barry O’s plan to take us to universal health care nirvana.  It’s real expensive.  Now in a the-dog-ate-my-homework moment, we have even newer tax proposals to pay for the monstrosity.  

First the stiffing.  Medical care consumes about 14 to 18 percent of the GDP which works out to about 1.8 trillion dollars annually (these are rough figures).  Already 800 billions dollars are in some way tied up with governmental programs such as Medicare and the like.  So, the question is what to do about the one trillion dollars that still lie in the private sector.  But, the biggest dead beat in the medical system is the government; not the uninsured.  Which means that trillion dollars isn’t just lying around just waiting to be expropriated, banana republic style.  That trillion dollars is already tied up in propping up governmental programs.  

This money, the private sector money, already makes up for shortfalls in the form of cost shifting.  The practice of charging more in other areas to make up for shortfalls in governmental reimbursement.  Moreover, there are any of a number of unfunded governmental mandates regarding requirements of the rendering of care.  EMTALA (the Emergency Medical Treatment and Active Labor Act) requires, regardless of ability to pay, legal status or citizenship, that hospitals provide emergency treatment regardless of ability to pay.  The law provides no mechanism for funding this mandate.  And, something like half of all emergency room presentations go uncompensated.  These costs are written off as bad debt by the hospitals.  Or, these costs are built into general costs and charges of the hospital to make up that shortfall.

And, as big a money loser EMTALA is, it really get expensive when it comes to trauma care where you can run through $20,000 worth of care in the first 2o minutes of presentation.  And, a lot of these folks aren’t just innocent bystanders.  Drunks with jaw fractures who were “just minding their own business” at the local bar.  Or, drunks, laced with other illicit drugs who happened to roll their cars in a motor vehicle accident.  Also, very likely not wearing seat belts.

The bottom line is that that trillion dollars in the private sector isn’t free and clear.  Huge chunks of the money are already accounted for and spent to keep Medicare and Medicaid from collapsing.  Trauma and emergency rooms services are, in essence a tax amounting to hundreds of millions of dollars, given gratis but virtue of unfunded governmental mandates.

This trillion dollars is also what brings new innovation to medical care.  Demographically driven medicine, a large part what falls into public health, will no longer yield significant savings or new treatment horizons.  Epidemics of, say, cholera, are largely things of the past simple because we’ve already invested in sewers and municipal water systems.  Vaccines are now common place.  And, so on.  Health Maintenance Organizations (HMO’s) have been playing this worn out turn since the 1930’s without any measurable effect.  

In the same fashion, Obama’s proposal to create some governmental program to “honestly broker” treatment options.  He makes a hypothetical of say Minnesota doctors treating patients of 25 percent less than, say, Florida doctors.  But, these guidelines work except in exceptions.  Which happen just about every time you see a patient.  Moreover, Florida’s residents being, on average, older that those of Minnesota, will likely have sicker patients requiring more resources to obtain a similar outcome.  And, everyone would just be healthier if they would all just exercise, cut those trans-fats and stop sitting in front of computers blogging.  So, shall we have the health police banging on our doors every morning so we get out and exercise.  And, shutter every McDonald’s.  Maybe, in the name of health care savings those Florida residents should do their patriotic duty and just die (more below).

The real frontier is technology driven medicine.  This frontier is hard to predict in terms of breakthroughs; and these breakthroughs create new arenas for medical treatment.  They create more demand.  They create more cost.  Because people actually want this treatment because they want to live and live comfortably.  But, this area will be sucked dry because of the cost and in order to limit care (see, again, below).  MRI scanners have allowed more accurate diagnosis in a myriad of disorders.  Our small town of Casper, Wyoming has four or five such machines.  More that entire Canadian provinces.  But, accurate diagnosis leads to unanticipated demands in whole new arenas of treatment.  Socialism above all requires stasis and ossification.

Then, to, is the fact that much of the medical infrastructure comes from the private sector.  Whether a private doctor’s office or a major medical center.  Governmental medical programs have largely piggy-backed on the infrastructure.  In many respects, governmental medical programs have largely survived because these programs merely make use of capacity at the margins.  Economic medical decision making is first of all, based on the economics of private sector finances.  Only then do you figure out if a given service can stand, economically, on governmental reimbursement.  If new medical initiatives rested on reasonable profits from governmental medical programs, you’d see all sorts of medical construction in our inner cities.

Finally, of course, will be the stiffing of the doctors themselves.  It will be some sort of pressure that will evolve from government fiat and monosopy power as a single payer.  Surgeons and specialties that do procedures can better survive, to a point, because one can be reimbursed both the procedure and the visit.  But, a primary care doctor, without the benefit of procedures, is going to go out of business.  A grim reality even today as Medicare patients are having increasing difficulty finding doctors that will take Medicare.

But, while those “bad” doctors may be everyone’s favorite whipping boy, are you also going to cut reimbursements in the form of salary cuts to our nurses?

The bottom line is that trillion private sector dollars will become a recurrent cost annually.  It might inject some honesty into the system since the unfunded mandates will also become a formal governmental responsibility.  Therefore, each and every year, the federal government will need to raise one trillion extra dollars just to nationalize what we have.  New initiatives?  New coverages?  New innovations?  That’s going to cost extra.

Now the snuffing.  As in killing.  And, this will ultimately be the effect of rationing.  In some fashion, rationing of medical care will result in people dying.  And, on purpose for reasons outlined below. 

Can this really happen?  Well, yes, because is already is in a sub rosa fashion.  The great tobacco settlements were supposed to drive a stake in the heart of big tobacco.  And, those settlement monies were to educate the public to finally put an end to that filthy habit of smoking.  We’ll pass over the fact that humans have been smoking and fermenting just about every plant since time immemorial.  What really happened was that every state in this settlement became a knowing partner in the enterprise of tobacco use because of the tax revenues.  And, states, instead of taxing cigarettes out of existence, tax at a rate to maximize revenue.  Moreover, state treasury officials know that smoking usually kills the smoker of a nice clean heart attack at about age 60; thereby freeing the state of any expense for future state Medicare and Medicaid expenditures.  It’s a wonder that the Social Security Administration isn’t pushing to revitalize smoking habits.

Debates over state motorcycle helmet laws now revolve on the fact that lack of helmet wearing usually results in the motorcycle rider being killed outright.  A much cheaper out come that treating a helmet-wearing rider who survives but with severe, very expensive to treat injuries.

Europe’s experience with euthanasia has already crossed a number of ethical barriers.  Doctors increasingly make decisions out of greater loyalty ”gate-keeping” state medical resources than loyalty to a patient.  Elderly in Holland are afraid to go to the hospital over this very fact.  This fear serves as a great rationing tool since the hospital isn’t expending resources on that patient.  If that patient were to die, all the better, since dead patients are really cheap to treat.

A colleague tells me, that in New Zealand, cardiac surgeons don’t work very hard.  On purpose.  It can literally take months to get a heart operation.  You might even die in the interim.  More bottom line savings.

And, oh, did you know that approximately 50 bucks of Pentothal is a lot cheaper than 100,000 dollars of hospice care?

Rationing is particularly pernicious to American Exceptionalism and a governing philosophy that organizes around the concept of the maximization of individual liberty (the pursuit of happiness).  Yes, as a surgeon, I have participated in the agonizing decision on when to “pull the plug” on a hopeless ill, dying patient.  And, in doing so, have had to face the fact the in this particular case, any further efforts are simply futile.  But, this was a decision entirely made by private parties.  Done only after assuring ourselves that we left no stone unturned.  Done without the intrusion or pressure of outside parties with other agenda, read financial, forcing a decision.  This was a decision with me acting with an overarching philosophy that only the best interest of my patient matters in this decision.

One must understand the tension of medical economics and Judeo-Christian morality that plays in this issue; and how government sponsored rationing will tear down the latter.  In tearing down the latter, to spawn an attitude that runs contrary to the importance of the individual and individual rights.  Those individual rights that are central to this thing we call Western Civilization. 

Modern medicine operates at the margins.  As a volunteer manager of our mutual medical insurance plan, I note, in reviewing our financial data, that 20 percent of our members covered consume 80 percent of the resources (in the form of medical benefits paid out) and the other 80 percent consume on 20 percent of the resources.  In the case of Medicare, we find that your last year of life, your last hospital admission, will be the most expensive.  Some 30 to 50 percent of Medicare expenditures specifically fund these very expensive end-of-life events.  Note, by being on the margins that many of these patients are in no real position to defend themselves.  Their illnesses impair their ability to work with a concomitant income disadvantage.  They are individuals, who if they died, wouldn’t materially affect statistics such as longevity and infant birth rates; especially if you knew how to fudge those statistics.  If you count infant mortality rate as only term babies, the infant mortality rate for premature births never comes on the radar.  You’re only a step away from saving enormous bucks by letting those premies, just, go.  If you’re in the last year of life, on that last hospital admission, national longevity statistics aren’t going to materially change if, you, just, pull the plug.  There’s hundreds of millions of dollars on the line if you do.

On the other hand, there is the temptation to move  into post-Christian (? pre-Islamic) America and abandon the Ten Commandments and their requirement to honor our mothers and fathers.  Well, maybe the ten suggestions.  There is the temptation to abandon the concept that every human is indeed a unique individual, created by God in His own image.  There is temptation no longer respect a life time of work and contributions of our elders and give comfort  and respect in their old age; rather, to discard them with the old Chicago Machine greeting of “Yeah, but what have you done for me lately.”

There is a temptation to embrace your inner socialist and no longer regard each citizen of our republic as a resource and spark of creativity.  But, to regard people as so many parts of a machine that consume food, shelter and create a big carbon footprint.  Machine parts to be discarded and replaced as they are worn out.  It becomes tempting as a “gate-keeper” to dole out medical resources only to repair those “parts” that are still functioning and “worth” repairing.  It becomes tempting to, say, regard every retiree as useless dead weight, past prime and past repair, to be discarded since maintenance now far exceeds the replacement cost.  Especially if your butt isn’t on the line.

It is only that trillion dollars, in private hands, that will effectively enforce the precepts of the sanctity of the individual and stand firm against the financial temptations to cut ethical corners in the name of preserving the public’s” medical resources.

Why Not The Worst?

Posted in democratic party, economics, energy, obama by mountainmusings on April 29, 2009

With Senator Spector jumping to the Democratic brand, we will have the legislative and executive branch firmly in the hands of the Democrats.  Unless, the Democratic leadership cannot trust it’s rank and file, the trillion dollar agenda that will beggar our grandchildren can not proceed unobstructed.  Won’t even be a need for the charade of “reconciliation” to push this agenda through.  And, most of all, Obama can shed the pretense that he is president and revert to this true calling as prime minister (or secretary general).  

Have it all!  Canadian-style single payer health care.  Cap and trade.  And, the next time Obama meets the king of Saudi Arabia, he needs not stop at a bow; go on, go all the way, the royal crotch was only another six inches away.  Chavez, Castro, Kim, Ahmadinejad, your reservation at the Lincoln Bedrooms awaits.

Spread the wealth?  Spread away.  Why stop at 90% AIG-style tax rates?  If you making $250K per year, you’re rich enough.  Everything above that belongs to the feds (and by extension ACORN).

And, we can all be greener than Kermit.  The folks out in Pennsylvania will now really have a reason to be bitter when our carbon-free future throws them all out into the unemployment line when their coal mines are shut down.  All they will have, then, is their guns and religion to cling to.

Torture “truth” commissions?  Why stop there?  Call up Robespierre and the Committee for Public Safety.  Why stop with some DOJ lawyers who nobody can remember?  How about Rove?  Heck, why not Cheney or even W?

Hyperbole?  Hopefully no, but stripping away some of the sarcasm, everything in this post has happened.  Obama did bow to a king.  Obama talked about more than cap and trade.  He talked about bankrupting new coal fired generation plants.  He talked about checking your tire pressure as an alternative to drilling for more oil.Pelosi is pushing for a “truth” commission.  

Ninty percent tax rate?  Such a thing existed from the 1930’s until the 1960’s.  The top marginal rate then remained at 70 percent until the Reagan tax cut of 1981.  The Obama, Reid, Pelosi trioka are just testing the waters.  They’re getting us used to the word “trillion.”  And, to banana republic economics; the ones that issue paper money that has the feel of Monopoly money.  First it was taxing away the AIG bonuses.  Again testing the waters to see if we’re ready for settling for the mediocracy of “free” health care in exchange for having everything over $250,000 taxed away since that’s rich enough.

But, there is a silver lining to all of this.  Now, Obama and the Democrats will be in complete, and I mean complete, ownership of this mess.  The high taxes, prolonged recession (?depression) and the hyperinflation.

 

 

Rick Wagoner, RIP

Posted in economics by mountainmusings on March 31, 2009

In some respects, getting canned is exactly what Wagoner deserved.  But, not for poor performance at GM.  Rather, for his failure to speak “truth to power” last year.  Truth to power, when it really counted.  Not, the some childish stunt by some crackpot liberal to embarrass a conservative politician; knowing that, for such rudeness, a well deserved punch in the face will not be forthcoming because of a raucous fourth estate.

And, Wagoner was in a position to do exactly that.  I would guess that whether Wagoner ever holds another job, he has accumulated enough wealth to more than comfortably support a sumptuous lifestyle.  With that economic underpinning, Wagoner was in a relatively invulnerable position to tell and tell off the solons of congress what the real problems for GM were.  Moreover, to tell Congress that many of these problems were made in Washington.  

Wagoner could have told Congress that GM’s problems stemmed from running a company for the purposes of de facto social security and medicare programs for the benefit of the UAW.  It also happens to make cars.  He could have told Congress that the CAFE standards were in place to preserve UAW jobs by forcing the manufacture of money-losing econoboxes, that no one wanted, in the US.  He could have told Congress that the CAFE standard business model was predicated on healthy sales of trucks, large cars and SUV’s to generate enough profit to offset the losses on the small cars.  He could have told Congress that anthromorphic global warming was a fraud, and a poor excuse for an economy killing tax called cap-and-trade.  He could have told Congress there was plentiful energy if bans on drilling off America’s coast lines and in ANWR were lifted.  If bans on shale oil extraction were abandoned.

Then, Wagoner could have spoken truth to his power and realized that he need to take the bull by the horns and taken GM to bankruptcy court.

But, Wagoner, being the good crony capitalist, played court jester and prostrated himself before the grandees of Congress and played to the fiction that these hypocritical blowhards actually knew something about running a business and about manufacturing cars.

The jester act was ridiculous.  He flew coach to the Washington hearing when it became known that he flew a corporate jet to the first hearing.  Never mind that jet junkets member of Congress avail themselves.  Or, never mind the veritable darkening of the skies with Hollywood’s private jets coming in for the Obama inaugural.  Never mind, that Wagoner, as CEO of an enterprise as large as GM owes his shareholders the most efficient use of his time; hence private jets.

Then the little joyride in the Chevy Volt with prominent members of Congress.  As if.  As if people with the power and clout of Senator Levin or Dodd are going to ever park their fat behinds in an overpriced econobox that will ultimately join the Trabant on the ash heap of automotive history.  Come on, a car that gets 40 miles between recharges.  And costs 40 grand.  

So, what did these prostrations get?  What did all the congressional butt kissing do (other than Barney loving it, euuu)?  Just another Obama signature throwing under the bus.  Nothing personal, Rick, just business, we needed someone to sacrifice on the altar of populism.  Just like those AIG employees.

The irony is that Wagoner actually has done a yeoman’s job in pulling GM back from the brink.  I very much suspect that even in bankruptcy court, any judge would have recognized Wagoner’s talents and work and probably kept him on for the restructuring.  In the arena of making cars, Wagoner was a star.  His failing was not really his.  Rather, it was coming up against problems and obstacles made in Washington; a UAW protected by CAFE standards, energy policies designed to jack up the price of gas.  Bankruptcy would have laid bare all of this Washington stupidity.

At least in bankruptcy court, Wagoner could have gone with his pride intact, knowing that managed GM with an honest appraisal of the realities that faced GM.

 

Country Club Democrats

Posted in economics by mountainmusings on March 29, 2009

Once upon the time there were the Country Club Republicans.  The monied old boy network of the right prep schools, ivy league universities followed by employment in the toniest of banks, brokerages and law firms.  And, membership in the right country clubs.  It could be pernicious since there were many practices of exclusion of those not WASP-ish enough from participation in the above venue.  This was back when Protestant meant something more than a transitional state to some “higher” spritial enlightment such as Gaia or Islam.  Even from the opportunity to buy a home in certain neighborhoods or communities was limited by “quota or point system dependent on your overall WASP bona fides.  And, this is above and beyond discrimination pointed at blacks.

I remember my mother telling me about an aquaitance that couldn’t find a home in the Chicago north shore suburbs because her name was mistaken to be Jewish.  I remember my childhood peditrician relating how lucky he was getting past the Jewish quota to get into medical school.

But, as pernicious as these things were, they were largely private sector affairs that had not the force of law (unlike Jim Crow) and, thanks to individual freedom, easily overcome within a generation or two.  There arose all sorts of mutual self-help organizations.  The founding of new medical schools and hospitals to specifically overcome such things as Jewish quotas.  And, there was just opportunity to amass wealth that would simply drown out WASP enclaves of privilege by creating all sorts of parallel universes.

But, now there’s a new country club and its called socialism.  What makes it particularly pernicious is that this has the force of law to enforce membership.  Socialism is merely the social ossification of royalty; just covered in the thin veneer of egalitarianism.  These country club Democrats are all very wealthy individuals, some so because of the unbroken prosperity of Reagan’s economic boom.  But, they know that they made it by upsetting the status quo.  In fact, every American fortune was made exactly that way.  Moreover, every American fortune shares the common dominator of bringing to the common man what was once reserved for the wealthy and privileged.  The bi-costal elite is populated with these types of individuals.  People who made it big and now are supporting a party that is diametrically opposed to the concept of wealth creation.

But, these same said plutocrats, want to shut the door behind them now that they made it.  Now that they rabble-roused their way to the top, they want to make sure that no one will do to them what they did to arrive at the top.  They, the once icky Joe-the-Plumbers, want to insure that there will be no future Joe-the-Plumbers joining them at their tony country clubs.

What to do?  Destroy the path that led them to success.  Nancy Pelosi’s 90% AIG tax is indeed a stalking horse.  This tax’s real purpose is to establish a method to cap economic attainment and success.  She and her elites can determine what each American may ultimately possess and how high they may rise.  And, hold the ability to determine who may so rise.  Pelosi, and her fellow travelers in the House and Senate leadership,  her fellow traveller in the Oval Office, are all already very wealthy individuals.  There taxes scheme miraculously leave their wealth untouched.  And, the captains of industry and finance, those who populate the Hamptons’ A-list social register are now seeing their firms bailed-out and their personal wealth largely untouched.  

But, any young whippersnapper is going to have his attainments capped at $250,000.  Or less.  Because you can bet that the need for control will slowly but surely ratchet down that $250,000 because, in reality, Democratic reality, $250,000 is really too rich.  And, in this manner, Country Club Socialism, we will have created a de jure system of social stratification that our Declaration of Independence overturned by rejecting the royalist paradigms Europe.  It is not the irritation of the nanny state, but this social stratification and ossification that makes this the Europeanization of America pernicious.

Obama’s Ideology of Second Place

Posted in economics by mountainmusings on March 2, 2009

“We can’t drive our SUV’s and eat as much as we want and keep our homes on 72 degrees at all times…and then just expect that other countries are going to say OK.”

The pillars that stood behind Obama at his Denver nomination acceptance speech were not evocative of ancient Athens, where the Athenian hoplites stood shoulder to shoulder in their phalanx to stop the maw of the Persian Empire at Marathon and Plataea.  It is not evocative of the Roman Republic were Rome’s citizen-soldiers filled the ranks of Rome’s legions.

No, it is evocative of Imperial Rome.  With Barack, divine Caesar , will dispense largess to the masses from the public treasury.  It is evocative of Leni Riefenstahl.

The first is a quote given by Obama, on a campaign stop in May  19, 2008.  In Oregon.  This represents yet, perhaps more elegant, blame-America-first speech.  SUV, eating and heating our homes, all wrapped up in the cloak of environmental correctness.  Just three more examples of America’s baleful presence upon the earth.  

But, this too was a real campaign promise.  A promise to rein big bad America.  It render America subservient to the rest of the “world.”  To make sure that our domestic and foreign policies are “okay” with the rest of the world.  Our national sovereignty will check in with some “world government,” some UN “consensus.”  With Obama himself, who, by virtue of his high melanin content and third world name graces the Oval Office with this magical “world cred.”

Riding this economic crisis is an exercise to lower American expectations.  To have American’s accept lessened hopes and dreams.  To extinguish the concept of American exceptionalism.  To prepare Americans to accept the new age of mediocrity and dependence (ht; William Katz, Urgent Agenda).  Commentators continue to critique Obama’s economic plans as exactly the wrong prescription to restore prosperity.  And, that’s exactly the point.  This economic plan is to destroy the legacy of growth and hope for a better tomorrow; to replace that hope with the acceptance of a permanent second place.  To accept that the Constitution and the Bill of Rights must now subordinate to the will of “international” consensus.

Obama is a complete stranger to American exceptionalism.  He spend the first ten years of his life in the third world with a upbringing in the Muslim ideology (not religion).  An ideology that is a polar opposite to the defense of individual liberty; the centerpiece of Western Civilization.  And, when Obama came back to the US, his mind was well prepared to accept the ranting of Reverend Wright, Bill Ayers and every chic Marxist professor that he ran into.  Not America the great, but America the second place.

And, to arrive at that state, he needs to build an electoral coalition of 51 percent who will permanently accept second place.  A 51 percent who will forever depend on the government to fill it’s needs and accept it largess as a birthright.  A 51 percent who will exchange it’s real birthright, the one secured by the Bill of Rights, for a mess of pottage.  A 51 percent who will look to the government for the proper cues on all manner of morals and attitudes.  

And, above all, a 51 percent who will forever look upon the other 49 percent as permanent tax slaves. For, that productive 49 percent, the real water carriers (to use CNBC’s Santarelli’s terminology), are the new Kulaks who must have the fruits of their productivity expropriated for being the rapacious, productive louts that they truly are.

Mr. Obama’s Ivy League credentials indicate that the man has at least enough intelligence to at least understand the principles that undergird free market economics.  Yet, he chooses to proceed in precisely the opposite direction and pursues spending policies that will leave a legacy that will beggar our grandchildren’s children.  On purpose.  He does to create a society that will permanently accept lowered expectations.  To create an inverse, where the state defines the individual.  Not, which is the source of our greatness, where the individual and his individual efforts define the state.  His policies invite us to accept serfdom and build our huts next to the moat and castle of the state.  To accept what ever pittance Obama and his acolytes will dispense in exchange for obedience to the diktats from his royal, heated to 72 degrees, court.

And, for that pittance you will accept Obama and his acolytes as your betters; your philosopher kings.   Rules and laws are for other people.  Boy-wonder  Geithner doesn’t have to taxes.  And, Obama, regardless that we bad Americans have to ask the “world” for permission to as to what to drive, eat and set our thermostats, will eat $100 per pound wagyu steak, drive around in a limousine based on a Chevy 2500 pick-up truck chassis and set the Oval Office thermostat to 72 degrees.  Hypocrisy by our betters, is okay with Plato, in his Republic, since our betters, in engineering and directing our lives, are above the law.

And, so for the pittance of the cradle to grave socialism.  For the beggaring of our children.  For permanent diminution of our horizons and hopes, we shall worship at the altar of whatever fad or fancy our leaders deem important.  The latest such fad is the false religion of environmentalism. We are to ignore the man behind the curtain and worship the great Oz, who tells us, despite real scientific evidence to the contrary, that “global warming” is threatening our planet.  And, we will save the earth by “cap and trade.”   The “green” agenda of “renewable” energy is actually a Luddite agenda.  The first solar photovoltaic cell was invented in 1883.  Wind power and windmills have been around since the middle ages.  

The horseless carriage has been in existence for over a century.  There have been battery cars and steam cars and all sorts of novel methods of propulsion.  The Prius is nothing new; it’s fuel efficiency is more due to the fact it’s a small light car.  A Ford Pinto, an AMC Gremlin, a Renault LeCar, updated to look good in front of a Starbucks.  How radical, innovative, is a internal combustion engine mated to a generator?  Every modern railroad locomotive uses a diesel engine to run a generator that powers motors to drive the locomotive forward.  A diesel Prius on steel wheels.

The fact is that we burn hydrocarbons for transportation and electrical generation because it turns out to be the most efficient and most economical way to accomplish the task at hand.  Yet, somehow, our all-knowing leaders, under the beneficent smile of our President, will find us a new, carbon-free solution known only to them; solutions that somehow eluded eluded the thousands  upon thousands of engineers who ever worked in the automotive or power generation industries.  But, of course, we lesser folks do not have the booby prize bauble from Stockholm like our new Energy Secretary (the Nobel Prize now places you in the company of Jimmy Carter, Yasser Arafat and Albert Gore).

But, no matter, our car czar will dictate the car we will drive, if we are deemed deserving to rate personal transportation and allowed to buy such a conveyance.  But, second class will be acceptable so long as we get our allotments of free food, housing and health care.  As long as we do not dare to aspire to a life or lifestyle that would exceed whatever would be “OK” with the rest of the world. 

 

The Second Coming (of Barry as Jimmy)

Posted in democratic party, economics, obama, politics by mountainmusings on February 27, 2009

To those who cared to look beyond the MSM smokescreen of the last election, this comes as no surprise.  But, the evidence is all in that Barry’s nothing but a tax and spend liberal.  We’ve got a budget outline that approached four trillion dollars.  And, after congress gets through it will be four trillion since Barry on set a floor on his budget proposal and has a tacit understanding with Reid and Pelosi, to run the tab up even more since he’s going to sign anything.

Then, we have proposals for more than a trillion dollars in tax increases.  The combined wet dreams of FDR, LBJ, Carter and Clinton, combined could not imagine such a number.  Well, maybe Clinton.

And, then we have the other boiler plate to the standard liberal.  The slow pre-emptive surrender to Islamic imperialism.  In Iraq, all our enemies have to do is run the clock until August 2010.  How’s that for telegraphing your attentions.

And gun control.  It seems that his lacky at justice, Holder, is making noises about re-instating the so-called “assault-weapons” ban in part because assault weapons are flowing from the north into Mexico, supplying the drug lords in their civil war against the government.  Never mind that Mexico is just this side of being a failed state.  Of course, this stuff never came out of Obama himself.  But, he like Pelosi, Reid and Schumer are just waiting…

Bait and switch.  The true intentions covered up by a compliant press.

But, it is worse.  If only we could have the day’s of Jimmy Carter.  What we really have is not a president but the UN secretary general occupying the Oval Office.  This man is a natural born citizen by virtue of the technicality of being born over US soil.  But, he spent his first ten years of life abroad.  Not at a military brat, who lived with a sense that he was a part of America.  But, as a Muslim in Indonesia, including attendance to a madrass.  So, not only did he live physically away from America, his upbringing was in a Muslim world-view; an antithesis of individual liberty which is the root of Western Civilization.

And, though he didn’t wind up practicing Islam.  His choice of “Christianity” was the virulent anti-American, anti-semitic variant of the “Reverend” Wright.

So, to add to the cheap vote-buying ethics of a Chicago ward-heeler.  So, to add to the fact that this man’s enitre adult life was living off other peoples’ money, extorting other people’s money.  So, to add to the fact that this man never ran a business, hired employees or met a payroll.  This man is now engaging in a third-world mentality of reducing his fellow citizens to the status of serf and subject.  

Obama’s spending and tax proposals make a mockery of the notion of private property.  These are whole sale expropriations of property that place him squarely in the company of Evo Morales and Hugo Chavez.  No, the comparison isn’t meant as a compliment.

Fraud, Pink Elephants, Taxes and Elvis

Posted in economics by mountainmusings on February 25, 2009

Consider this.  A survey, completed in the mid-90’s calculated that the average American family had tax liabilities (federal, FICA, state, local, ect) that consumed 40 percent of that family income.  That’s the average.  You have to know that liability is much higher in localities like New Jersey or California.  That is, in round numbers, the need to earn two dollars before you can have one dollar to put food on the table, clothes on your children’s backs and a roof over their heads.

But, on a macro level, every transaction, whether buyer or seller has this assumption built in–that any purchase must account for the fact that for every dollar spent, another dollar will go to the government.

Now, consider this.  There was another survey of generation X’ers done in the mid-90’s that determined that a greater percentage believed that Elvis would return to earth on a UFO than ever seeing a dime out of Social Security.  The 90’s, before our latest financial meltdown, back when time were really good.  Aside from the humor in this survey there is an undercurrent that nobody really believes that US government is going to really deliver.

So, here’s the pink elephant, standing in the middle of the living room, that everyone seems to tip-toe around.  The enormous incentives to “game” the system to eek out an extra dollar from wherever you can find it.  It is not to justify the moral righteousness of the excesses of Wall Street or the tawdry tax evasions of Obama cabinet appointment after appointment.  But, we live in an era of such moral turpitude in which our money is being spent by our solons in congress that will beggar our grandchildren’s grandchildren.  We have seen tax evasions on the part of cabinet appointees, an ex-senator in one case, that gets off with a slap on a wrist or appointment anyway to Treasury Secretary.  And, we therefore have a tax cheat as head of the IRS.  What sort of wrath would be visited upon the “unconnected” by the IRS for similiar offenses.

In Obama’s home town of Chicago it isn’t subtle.  Everything is for sale.  Even Senate seats.  There is a resultant cynicism seeped into the bones of every Chicagoan that makes even the rare examples of true public spiritedness suspect.

And, in so may ways we have governance by people who seem to think that laws and rules are for other people.  And, so with such conditions of confiscatory taxes and moral turpitude the temptation to cheat starts to grow.  It becomes a game.  Minimizing exposure to the IRS.  Bartering dental fillings for an auto tune-up.  Everything done on the black market is an automatic 50 percent discount.

If people could actually keep more of what they earned would there be less cheating?  Would there be less incentive to take short cuts?  It’s interesting to note that VAT taxes never yield more than ten percent of the items being taxes.  Since any VAT tax over ten percent stimulates the establishment of a black market that immediately drives the the VAT tax yield back down to ten percent.

A while back, I read in the WSJ that a socialist economist, I think in the 50’s, calculated the most efficient tax rate to maximize wealth transfer.  This taking into account that higher tax rates would depress economic activity to drive down the amount of wealth that could be transfered.  His result; his optimal tax rate was 20 percent.  The exact same percentage that Pharaoh, at Joseph’s behest, taxed to have enough save away from the seven good years for the seven lean years.

Barry, You’re So Last Century

Posted in economics, obama by mountainmusings on February 24, 2009

The patterns are coming clear about Obama’s world view and economic views.  His stimulus plan falls into the pattern.  No, Obama didn’t write it.  But, he didn’t care so long as it spent a lot of money.  And, it starts this nation down the past of big city machine politics.

What has been slowly metastizing from local, to state and now to the federal level is a model of governance that seeks to fleece some minority of taxpayers for the benefit of a given politician’s friends and allies.  This was the model that to some degree afflicts almost every large city in our country.  This has been the model of economic stagnation for the last century.  Big city machine politics creates a voting bloc of 51 percent to steal from the other 49 percent; economic justice and fairness don’t you know.  The 49 percent vote with their feet, leaving said city an economic wasteland.  So, since that city can control a significant block of representatives in the state legislature, this same city machine needs to go further afield to find that 49 percent to tax, but at the state level.  The net result is to saddle, at the state level, the same diastrous economic policies that now render that state an economic wasteland.

And, regions and states mimic stellar evolution going from the young blue-white star of economic vitality, to the to the aging red giant start of a state-wide economy where private sector economic activity is beginning to struggle to keep ahead of taxes and public spending.  Then, there’s the black hole; the where the citizen is just regarded as a sheep to be fleeced and flayed to generate revenue for the sake of the friends and dependents of the ruling political machine.  

And, this country is now littered with economic black holes.  Whole metropolitan areas, whole states where governmental entities lurch from budget crisis to budget crisis in search of tax revenue to make it another year.  States like New York, California or New Jersey.  New York used to be a veritable hot house of economic activity and innovation.  Corning, Kodak, Xerox, Westinghouse.  Out on Long Island, yes on the same island that now hosts the oh so politically correct Hamptons, was Grumman, grinding out Hellcats and Wildcats that helped on our march to victory in the Pacific against imperial Japan.  Victory, what a quaint term.  Now, economic news out of Rochester consists of how many more layoffs are coming out of Xerox or Kodak.  Meanwhile, back in Albany, you have the same set of buccaneers trying to figure how to pay off their constituencies by trying to find something else to tax.  New Jersey, speaking of innovation, was where Thomas Edison invented and innovated. 

California?  What’s to say. Other than the fact that California seems to be the harbinger of trends that sweep the nation.  Maybe, in the light of Hoover, when we are indeed thrown into a real depression, we can name our shantytowns Obamavilles or Pelosivilles.

But, after a century of this Ponzi scheme of creating coalitions of 51 percent to stick it to the other 49 percent, we only have one way to go.  Now you have to take city-wide extortion that metastasized to state wide extortion to a national scale.  And, somehow this model of economic extortion will now work on a federal level when it failed, over the long term, in various and sundry places at the local and state level.  And, internationally, wherever socialism has pushed out free-markets.

And, yet, the President of Cool, the President of “change” comes to Washington D.C. to promote an economic model that is failing or failed in so many diverse places by doubling down and trying to promote this last-century economic of political machine bossism (socialism, American style) on the country at large.  Yes, at this point, the productive 49 percent will no longer be able to vote with their feet, but they will vote with their cessation of productivity.

The Liar

Posted in corruption, democratic party, economics, main stream media, obama by mountainmusings on February 10, 2009

Sins of omission are venial; sins of commission are mortal.  Except the sin of omission that allowed Obama, with a knowing wink from the MSM, to hide the true ideologic identity of his impending presidency during the last campaign.  The omission was done wiht the intent to deceive; both Obama and the MSM knew that.

Change, change, change.  That was not fair warning because every presidental candidate has always projected himself as such an agent.  Seriously, when’s the last time a presidential candidate say “Vote for me because I’m a stick-in-the-mud like the guy I want to replace.”

No, this promise of “change” was purposely kept vague to hide an agenda that only now have become utterly manifest.  An agenda that amounts to transforming America into a EU social-welfare democracy.  To be sure the mask slipped a few times; the “spread the wealth” remark to Joe-the-plumber and Obama’s interview about bankrupting companies wanting to burn coal to generate electricity with “cap and trade.’

But, there was plenty of evidence that Obama was in the pocket of his socialist and Marxist mentors and professors.  There was no way that Obama didn’t know what Bill Ayers true views and background were.  He served as co-chair with Ayers on the Chicago Annenberg Challenge to distribute some 100 million dollars of grant money.  There was evidence all over that Obama was an unreconstructed Marxist from the beginning.  But, like Carter, like Clinton, those embarrassing past fact were papered over by a compliant and fully knowing MSM.  We knew more about a pregnant 17 year-old, who couldn’t even vote, because she happened to be the daughter of a vice-presidential candidate.

Then came January 20th and the most expensive bait-and-switch in world history was unveiled–the economic “stimulus” bill.  This wasn’t creeping socialism; this was a full bore, in your face, coup d’etat.  Jefferson, Madison, take a hike, you’re history.  

So, now, the Democrats are trying to push this bill through before public opinion really trashes its chances of passage.  As I write, three Republicans have broken ranks and the Senate version will probably pass tomorrow.  I predict that the bill that will emerge from conference will merge the differences by authorizing spending for everything in the Senate and House versions; creating a bill that will almost definitely break a trillion dollars.

But, figures, especially one trillion, never lie and liars never figure.  The silver lining is that this bill, if it passes, will expend the good will and credibility, almost entirely, of Obama’s nascent administration.  All within the first month.  Bait-and-switch has a way of pissing people off.  

And, in the end, Obama will have been rolled, not by the GOP, but by his own party.  And, the credibility that will be needed to try to enact the rest of his agenda will no longer be present.

The Politics of Overreach

Posted in biden, corruption, democratic party, economics, gop, obama by mountainmusings on February 6, 2009

The socialist revolution planned by Obama and company may have been upended by hubris.  Hubris and the insularity of politicians that come from jurisdictions that sport one party rule and a whole lot of corruption on the side.

Let’s start with Pelosi.  She’s busily and bravely taking bullets for Obama in pushing a frankly socialist remake of America.  The results of her so-called stimulus plan is a grotesque caricature of the “tax and spend” liberal; so over the top that is will supply the likes of Jay Leno with jokes for the next century.   It is a spending plan that puts the US into the realm of financial stewardship reflective of a banana republic.  And, this, thankfully is its downfall; both of this particular piece of legislation and, hopefully, the rest of Obama’s agenda.  

But, this grotesque spending plan is the product of a congresswoman who inhabits a district from San Francisco where her chances of being picked off by a Republican challenger is somewhat less than zero.  This is the neighborhood of the Getty manse; the venue of Obama’s famous “bitter” remarks (except they really believe it there).  Further, she has plenty of personal wealth, to augment her congressional perks of power to easily insulate her from any of the economic hard times now rocking many of her fellow Americans.  The result is a completely tone deaf woman who thinks that cornering the condom market is economic stimulus.

The we have the exalted one; Obama.  As I type, he’s had four key nominations in serious ethical trouble; one for pay to play and three for taxes.  And, the grand solons of the MSM wring their hands as to how their exalted leader has such a flawed vetting process.  

The real answer is again the arrogance and insulation that comes from operating in the corrupt one-party rule of the Chicago Democrat political machine.  In Obama’s mind, there’s nothing wrong with his vetting because such vetting would be more than adequate in Chicago.  In Chicago, everyone has ethical skeletons in the closet.  To insist, in Chicago, on such things as being reasonable accurate with tax filing would amount to the pot calling the kettle black.  I suspect, so conditioned to ethical lapses, that the Obama team never even realized that people outside the bubble that is Chicago machine politics may actually object to failing to report and pay hundred of thousands of dollars in taxes.

Obama, like many of his fellow traveller in the Democrat caucus, have lived their entire lives using other people’s money.  Obama drew a salary as a ward heeler (the old fashioned term for “community organizer”).  And, his employer, ACORN made its mark by extorting  money for “free” home–the nidus of the sub prime meltdown.  Through these activities, Obama was deemed worthy to co-chair the Chicago Annenberg Challenge to distribute $100 million dollars to selected friends and do nothing to do the stated goal of the Challenge, improve public education.  This is the “executive” experience he now brings to the White House.  Then on to the Illinois State legislature, the US Senate and now President.  Obama’s a very wealthy man who never added one iota of wealth to the GDP.  

And, while in Chicago, his only experience with economic policy is Chicago economic policy.  The fine art of taxes and graft of the truly productive elements of the Northern Illinois economy; just enough squeeze but just short of the breaking point.  The result is a miserably expensive place to live.  Sales taxes hovering around ten percent.  Property taxes, as compared to my home town, that aren’t just a lot more but a lot more by almost an order of magnitude.

Obama’s vice-president, Biden, got himself elected to the US Senate two years out of law school.  Then kept getting re-elected and re-elected.  The job in the Senate is the only job Biden’s held and only paycheck he’s has drawn for his entire adult life.

Then’s there’s Daschle.  A man, since his exit from the Senate, who became a multi-millionaire trading in favors and connections.  Again, wealth without one iota of economic growth or innovation.  And, by the Biden’s standard of tax paying patriotism, Daschle is clearly un-American.  

Yet, Obama, with a knowing wink, hands his legacy over to Pelosi, to write a “stimulus” bill that is a Trojan Horse for the down payment on the new Socialist America.  To say the least, the gross excess is so excessive that it takes no effort to ridicule, it ridicules itself.  

In the process, we find Obama getting rolled by both parties.  First his “friends” in his party set him up with this “stimulus” and now the GOP is making him look like a fool for being within ten miles of this legislative dog.  Our enemies are very astutely weighing this sterling example of presidential leadership.  The real irony is that Obama is so bought into this “stimulus” that he’s practically committed to signing anything, including a pig with lipstick (couldn’t resist), that walks into the Oval Office with the word “stimulus” painted on it side.

Since his only “exeuctive” experience was giving money when chairiing the Chicago Annenberg Challenge, we have a man with none.  This was not an exercise in delegation, it was abdication of responsibility to Pelosi and the solons of the House Democratic Cacaus.  With similiar dithering on Gitmo, were going to just outsource torture.

At bottom, politics has rough principles of honesty.  Everything in politics consists of verbal agreements; you’re only as good as your word.  With fellow politicians and with the public.  Everyone knows to discount a certain amount of verbal hyperbole, but the bait-and-switch that is the Obama-Pelosi-Reid troika is the result of three politicians that don’t have the grounding that there are a lot of people who still value the fact that your word is your bond. 

In Chicago, there is essentially a breakdown of the rule of law.  A cynisicism governs all things public; born of a knowledge that everything is for sale.  And, it creates a seperation between those who nominally hold the public trust and those for whom they govern.  there exists a seperateness that politicians live in their own world and the subjects do what they can, after paying tribute, to keep government at arm’s length.  So inured is Chicago to this attitude that a politician like Obama can assume that this is just business as usual.  But, outside Chicago, outside safely Gerrymandered congressional districts are people who will look upon the lies of these insulated politicians and vote to counter these liars. 

The Last Temptation of Christ, er, Barack

Posted in democratic party, economics, obama by mountainmusings on January 30, 2009

When Obama arrived in the Senate and almost simultaneously started his run for President, he lived in a different world.  His was a world of essentially unbroken prosperity since the Reagan presidency starting in 1981.  Mr. Obama is part of that demographic in which people have spend most if not all of their adult lives, if not their entire lives, in an era of unbroken prosperity.  

In a similiar fashion, the high school class of 1972 was the last to face the prospect of the draft.  And, again we have a demographic that simply does not know war.  Not to in any denigrate the sacrifice of any of our servicemen, but the sum total of combat casualties from 1972 to the present was easily and tragically exceeded in a matter of days, if not a day, on many occasions in our countries military history.  Antietam.  Gettysburg.  Tarawa.  D-Day.  Ardennes, December 1944.  Iwo Jima.  Okinawa.  Again, a whole demographic has spent their lives, never contemporaneously, experiencing through their peers the combat experiences that other generations of Americans experienced.

So, we have a unique bubble in American history of peace and prosperity that probably has no parallel in American history; and probably in world history.  And, it bred a conceit that allowed many Americans to indulge in fantasies that the good times would roll on forever and we could always count on ever more and ever more.  We could engage in conceit of environmentalism that have us believe that we could regulate our carbon emissions and control our climate.  We could overthrow our hydrocarbon based economy and indulge in wind and solar power.  We could outsource all of our icky jobs, like drilling for oil, to some no-account third world country, expect cheap energy, and feel good about our environmental sensitivity because we swept that dirty activity under the rug and out of sight at our oh-so chic Starbucks.

Indeed, Obama sensed an opportunity to expand on these conceits in using discontent over the refusal to face up to the realities of our civilizational conflict with Islamic imperalism to gain the Oval Office.  But, to do so in a bait-and-switch fashion, to use the power of the office and the prosperity of Reagan’s economic policies, to create a European-style cradle-to-grave social democracy.  This was to be the culmination of the long march started by the 60’s radicals, like Ayers and Hillary Clinton, to finally put one of their own into the Oval Office.  We would finally do away with the evils of Reagan’s economic policies, our “Rambo” foreign policy, terminate the “war on terror” by abject dhimmhitude and deliver our national  sovereignty to the UN as its most loyal vassal.  But, this whole slight of hand would work in the era of good times and prosperity.  

But, on or about September 15, last year was the economic implosion caused by the sub-prime mortgage meltdown.  Courtesy, in part, by the corruption of his former employer, ACORN.  The economic crisis won him the presidential election that was to that point a toss-up.  But, the economic assumptions, the prosperity and the conceits that were Obama’s world and world view for all of his adult life were overturned.  The factor that won the election also gave Obama a radically altered world that he never experienced.

Now, the economic crisis, like war, has taken on a life of its own.  In doing so, this crisis is creating it own demands; demands that do not fit the agenda that existed prior to September 15th.

So, now Obama finds himself not in FDR’s shoes, but in Hoover’s shoes trying to operate in this new economic environment.  And, if he’s any student of history, it was Hoover, who spent three years of his presidency trying to do something that turned a recession into the depression.  And, like the Great Depression, this economic crisis and downturn has its roots in extremely injudicious governmental meddling. 

Obama’s spent his life using other people’s money.  So, he’s got exactly zero experience in what it takes to create wealth.  And, wealth creation is the only thing that will secure his legacy, a positive one that is.   But, he’s got people around him who know how.  His rich donors all know how or inherited wealth from ancestors who knew how.  Even his trust fund baby supporters should know that the size of those monthly trust fund checks are very dependent on the success of the underlying investments.

But, between those two giant ears buzzes a brain of a stone-cold socialist.  And, true to his baby boomer self, there remains a need to have it all–great legacy, peace on earth through surrender, socialist America, obeisance to the UN, world government.  An updated McGovernite world view of abortion, amnesty and acid.

So, while he needs to be paying off the 700 billion dollar TARP infusion of cash with economic growth policies, there is an internal conflict in Obama.  There is the inner Obama, the socialist Obama, that knows all the right answers and must have everyone marching lock-step to his patently and obviously correct world view.  There beats a heart that cannot trust that others actually have ideas of their own that are equally good.  Nor can he trust others to work out their own problems.  Yet, Obama’s legacy will hang in the balance on whether he can trust individual anonymous Americans, who through their own hard work, will lift up our economy again.  Or, will he place his legacy in the hands of people like Speaker Pelosi.  It simply runs against his Ivy-league roots to trust the entrepreneurial spirit of Joe-the-plumber over, say, our oh-so-polished oh-so-sophisticated tax-cheat Treasury Secretary.

Steven Chu, our new Energy Secretary, is symptomatic of the elite midnight dorm-room bull session governance we are going to be getting.  Here’s a guy who’s going to push energy policy into the arena of hair-brain and exorbitantly expensive alternatives in the name of the fraud that is man-made global warming.  Like the fraud of eugenics, global warming has become a political and social movement; because it factual, scientific basis is in tatters.  A century ago, eugenics was quite the rage.  It garnered support from the likes of Theodore Roosevelt, Woodrow wilson, John Maynard Keynes, Margaret Sanger (a founder of Planned Parenthood) and Winston Churchill.  Funding from the likes of the Rockefeller Foundation and the Carnegie Institute. And, now, history repeats with a new pseudo-scientific fraud that has as it principle argument support from the social register A-list.  

But, it goes further than that.  Like Obama, you’ve got a guys like Chu who know or is going to find the right answer.  Moreover, they have a monopoly on that right answer.

Wind power has been around  for centuries, since medieval Europe.  Solar power has been around for the better part of a century.  We’ve had steam cars and electric cars since the inception of the horseless carriage a century ago.  There’s nothing really new under the sun.  Every modern railroad locomotive is a diesel engine powering a generator to supply electricity to motor that turn the locomotive’s wheels.  Kinda like a Prius with steel wheels on rails.

But, in their conceit, Obama and his acolytes seem to think that they have an answer for our energy and transportation need that somehow has managed to elude thousands upon thousands of people who now work in our energy and transportation sectors.  The gasoline and diesel powered internal combustion engine dominates because it works the best.  If there were a better solution, someone, in the last century would have hit on it.  Would have hit on it long before the holy inspirational glow of  Obama shone forth from the Oval Office.

So, now we have a “stimulus” package that is going to run over Obama’s legacy like a freight train roaring along at 70 miles per hour.  It is a package that is so monstrous that it’s  a caricature of the tax-and-spend liberal.  It isn’t long before  the term ”welfare queen” comes back into common parlance. And, soon after that, the silent juxtaposition of the work “black.”  Obama, for the sake of his legacy better watch that one.

But, the silver lining is that this egregious overreach on the part of Pelosi will so damage the credibility of the Democrats that this bill is the only thing the Democrats are going to get past before inflationary pressures of loose money and trillions of federal spending ignite inflation the likes we haven’t seen since Carter.

Pelosi Motors, Inc. II

Posted in economics, energy, environment by mountainmusings on December 16, 2008

Here we wait, with baited breath, as to whether the Detroit auto makers will be bailed out or will have to file chapter 11.  If GM has any sense, it’ll take chapter 11.  Because if it doesn’t, it will become a wholly owned subsidiary of the Democratic party.  

As things stand now, GM (I use GM as shorthand for GM, and Chrysler) is a welfare agency funded by the manufacture of expensive luxury cars, large SUV’s and trucks.  And, as a bone to be tossed to the environmentalists, also manufactures small cars at a loss.  It provides lavish health care benefits and pensions for a retired workforce that outnumbers the number of UAW workers actually on the production line.  Through the “job bank” it runs a de facto unemployment agency.  Essentially, GM runs a social security agency, a medicare agency and unemployment agency.  Car manufacturing is just a side line activity.

The whole shell game worked as long as there was cheap gas.  But, the environmentalists over-reached, when their nirvana of four-plus dollar gasoline hit last summer.  Then the whole game of selling large cars to subsidize small cars and a welfare agency fell apart when the environmental wing of the Democratic party decided, in the name of global warming, to declare a jihad on the internal combustion engine.

And, “bankruptcy is not an option” Pelosi is trying to have her cake and eat it.  She wants to prop up GM Welfare, Inc. as payback to Big Labor.  And, she wants to appease the green crowd with “fuel efficient” cars.  What this bailout will do, especially with a “car czar” in Obama’s administration will result in is subsidization of UAW membership, working and retired, and diktats for econoboxes that you’re going to have to give away.  The Trabant comes to America!  Maybe each should have a bust of Nancy as a hood ornament.  We could augment the Pelosi car lineup with the Lada and the Skoda.  Back in 1992, I drove around in a Skoda in Iceland; it had a manual choke.  Manual choke, like the one on your lawn mower.  Never saw one in a car?  I thought so.

And, all the assumptions that drive the green agenda are suspect to say the least.  Global warming is in the process of being debunked.  And, Dr. Chu, our new Energy Secretary, doesn’t impress even waving his gold bauble he got in Stockholm.  Also, with economic growth, jobs and a recession, possibly a depression, this green agenda is going to be a real loser at the polls come 2010.  

It’s not that GM makes bad cars.  They make good trucks, SUV’s and large cars.  These big cars are more comfortable, have greater utility and are safer.  You’re going to make ten trips in a smart car if you’re going to get enough groceries home to feed your family; I’ll pass on that fuel economy.  While you may use said car as a single passenger for a good deal of the time; there comes many a time when you indeed need the extra space for, say, the hockey team and their attendant massive duffles of equipment.  And, yes, I know.  Your not supposed to have a family because of each child’s massive carbon footprint.  ”Enlightened” Americans realize that abortion is so much more environmentally sensitive.  

Big cars are safer, because mass is greater structural rigidity.  You can put all the airbags in you want; add one hundred pounds of structural steel and it’s just safer.

And, given a choice most people prefer them to any tin bucket with pie-pan wheels. Start with Obama; he’s got an SUV for his family.  His new presidential limo is based on a Chevy 2500 chassis.  Also, watch, all of his Hollywood celebrity friends pulling up for the inauguration in their 10 mph limos (after arriving in their private jets).  You’ll see the typical elitist conceit that all of this “sacrifice” and “save the earth claptrap” is for other, lesser people.

Over in Europe, manufactures such as BMW and Mercedes Benz make very substantial cars for rich customer who can afford and otherwise don’t care about $9 per gallon gas.  Somehow, when given a choice, this claptrap of global warming, carbon footprints seem to go down the drain.

Any bankruptcy court will immediately see the value of GM and its American counterparts.  All three of these American manufacturers make light trucks and SUV’s that are very much desired.  Stripped of its money-losing domestic small car operations all three of these companies can make motor vehicles that will attract customers.  Also, there will still be a vast market for spare parts and service.

If Pelosi has any smarts, she’d best dump her green crowd since $4 per gallon gas is going to lose more elections than win them.  She’d also be well served to abolish CAFE standards and drill, drill, drill. 

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The Chicago Tribune Bankruptcy

Posted in economics by mountainmusings on December 10, 2008

I guess, Col. McCormick, founder of the Chicago Tribune, tired of rolling in his grave over the Chicago Tribune’s liberal transgressions decided to take matters in his own hands and really spook up the place.  Is that smoke, emanating from the Tribune tower, courtesy McCormick’s poltergeist?  Or, is that chapter 11?

The lesson over the dropping fortunes of the major organs of the MSM is that printing liberal propaganda is not a winning business model.  The standard business school answer is that advertising income, particularly from the classified ads is the reason for the drop in revenues.  But, that misses the point that advertising is built on your ability to attract an audience, that will in buying your newspaper, will also be audience to those ads.

What newspapers are supposed to be selling is information; that is their draw.  From the one sided reporting this last election, we know that Obama is one step above God and McCain hails from somewhere in the lower circles of hell. Palin’s even lower; I think it’s called Alaska.  And, now these same MSM mavens, having elected Obama admit they really don’t know what he’s about.  An admission from the very heart of the MSM that they didn’t do their job in the first place by finding out and reporting that.  

And, now we’re expected these MSM rags and thereby pay for such incompetence in reportage.  Propaganda is advertising and is supposed to be free; it is expected to be provided for free.  Therefore, these newspapers shouldn’t be expecting to be paid for the moral equivalent of junk mail.  People, however, will pay for information.  So, it time to junk the highfaluting pretenses that come with that journalism degree on the wall and really start to wear out some shoe leather and get that scoop.  Not “context,” not biased interpretation, no interpretations period.  Just the story, just the facts.  I, thank you, will provide the perspective.

I note that one of the components of the bankrupt Tribune Company is WGN.  And, WGN broadcasts Bozo’s Circus.  Maybe the unemployed Tribune staffers could take turns filling in for Bozo. 

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Blagojevich; Absolute Power and Corruption

Posted in Illinois, corruption, economics by mountainmusings on December 10, 2008

I’m realistic enough to realize that nothing for free in politics; especially in Chicago.  But, to blatantly  place a Senate seat on the auction block to the highest bidder for the personal gain of Blagojevich does boggle the mind.  But, maybe not.  

Over the last few decades there has been a iron triangle with the Democratic party, the MSM and the bicoastal elite to cover for almost every transgression of almost any Democratic politician.  That with a constituency that only care about free government checks, abortion and gay marriage.  Frankly, as long as these three things are delivered, you could get caught in bed with immature gerbils and still get re-elected; as a Democrat.  Impeached philanderer, Bill Clinton still collects a government pension and is making stacks of money speechifying on the rubber chicken circuit.  Hill’s about to take over at the State Department. 

And, it almost becomes regarded as a birthright, for these politicians, that the law is for other people.  I suspect that Blagojevich is so marinated in the corruption of Chicago/Illinois politics that it never occurred to him that what he was doing illegal.  So marinated that he could presume to conduct this corruption openly over the phone even though he was already under Federal scrutiny; a federal wiretap didn’t even cross his mind.

This corruption has a real cost.  Illinois, particularly the Chicago area, is a miserably expensive place to live.  Sales taxes edging towards ten percent.  Property taxes, at least compared to Wyoming, aren’t just higher by a percentage but almost by an order of magnitude.

And these taxes and the spending imperatives behind them come from an attitude of complete lack of respect that this money, that these corrupt politicians tax and spend, is not their money.  It is this fundamental attitude that your money becomes the personal property of every tax-and-spend politician. In turn leading to a high tax and high cost environment that seems to, in particular, typify blue-state America.  

Also, because there are always individuals who can command compensation regardless of the tax environment, such compensation demanded will be priced to discount these high tax levels.  This drags up the entire pricing environment and drags prices and cost of living for up for everyone. 

I’m only hoping the moribund Illinois GOP can seize this opportunity to push through true reform.  Simultaneously, demonstrate that corrupt politics as usual has real costs; in high taxes and general cost of living.

The Reid and Pelosi Wildcard

Posted in economics, obama, politics by mountainmusings on November 24, 2008

Mr. Katz of Urgent Agenda notes that Obama’s picks for his incoming administration are causes of worry, but also relief. There is, at least, a certain seriousness to these picks that reflects that Obama is playing in an entirely new league. Perhaps the biggest criticism beyond some of the personal baggage, Holder comes to mind, that we have an administration that is being stacked with that slice America that got double 800’s on their SAT’s.  Or, the inverse of the late Buckley, with rule by the Harvard faculty rather than the first hundred names out of the Cambridge phone directory.

One can only hope, for all of the stellar academic credentials, that these advisers will have the humility to realize that they can never craft policy that will anticipate the needs of 300 million Americans. Or, that this isn’t the purpose or business of government. One hopes that they will remember enough of Econ 101 to realize that economic growth is the only solution to this economic melt down. Meaning that the Joe-the-plumbers will need to be protected and supported from crushing taxes and regulation. That creating, not spreading, wealth is what lies between a brief recession and a depression.

As McCain’s father said, history is made by poker players and not analysts. We’ll see what these people will do in time of crisis where you will have to take a lifetime of experience and react; and hope that reaction is a reflection of carefully thought out positions that you will not, in that moment of crisis, have the time to think through in a linear fashion. A crisis moment that will force you to act from the gut because you will not have to time to analyze. 

More interestingly, Obama almost seems like the young prince Hal who now casts off Falstaff as he assumes the mantle of power as Henry V. Did Obama, in his 20 or so years in the Chicago machine, “know you all” and for a while “upheld the unyoked humor of their idleness.” Of Ayers, Wright, Rezko. Is he, therefore, a radical or truly a centrist? Are his centrist tendencies, of late, of choice or circumstance? A thin resume and now we know even less. 

All very cynical, of course. But, there’s that adage that fulfilling your friendship needs in Washington can only be done reliably  with a dog.

I also suspect that Obama realizes that his legacy is not getting elected but getting elected and performing as president to his getting re-elected. To be the first black president means he can’t go out as a failure like Hoover or Carter; to go out as the first black president who screwed up. No longer does he have the comfort of spouting out pronouncement that have little impact in a safe district controlled by the Chicago political machine. I rather suspect, particularly in handoff briefings on security, that he came into contact with intelligence that would instantly age anyone ten years in ten minutes. 

And, that Falstaff comes with multiple faces; principally Reid and Pelosi. But, the biggest hurdle to succeeding as president will be his putative allies in Congress. Already, they are lining up an agenda that will drive the country over the cliff. He needs, above all, an economy that can pull it self out of a recession. 

The meltdown and recession that got Obama elected, is a mixed blessing because it is like a wounded animal that can turn on you in a minute. This is already Obama’s economy and his recession. This is no longer the crisis that can be used to push other agendas. This is a stand-alone crisis that will ultimately drag Obama down; and must be addressed regardless of the rest of his campaign wish list.

But, the solons of Congress, who control its committees have a very different idea. They, from safe seats and with very parochial agendas will use this crisis to pursue other agendas. The biggest warning sign is the ouster of Dingell by Waxman. Waxman, too marinated in the money and celebrity of Beverly Hills, is about to wave a magic wand and decree that we will all live a life of perfection by junking the burning of fossil fuels and embrace our inner windmill. In the insular world of Beverly Hills, far removed the concerns of Americans that actually live paycheck to paycheck, is a world that doesn’t think about how food, energy, transportation all come to their doorsteps. These are things brought in by the “help.” In a world of Rodeo-Drive-chinchilla-bedspreads it matters not that the “help” actually shops at Wal-mart to squeeze value out of every last penny of their paychecks.

Yet, here is Waxman, ready to push cap and trade. The costs and economic distortions of this program alone is sufficient to tank this economy into a depression.

And, we have Frank who can’t wait to get started on cutting our defense budget by 25 percent. And, we all breathe a sigh of relief that, on the Senate side, Bingaman has just announced that a new gas tax will be deferred. 

I’m beginning to think, through his choices of advisors, that Obama realizes that he’s on his own. Ayers might be good company for an all-night dorm room bull session. But, he’s got his legacy on the line and that’s already being seriously threatened.

As a conservative, I’m sure that a lot of what Obama does is going to give me a lot of heartburn. But, he’s our President. And, for the sake of our country, he needs to succeed by making the right choices. It is good, therefore, that he’s bringing in serious people. Leftist in orientation, but, hopefully, with a degree of education to bring objectivity that such an education should engender.

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An Open Letter to My Senators About the Auto Bailout

Posted in economics by mountainmusings on November 22, 2008

Dear Senators Enzi and Barrasso:

I wish to restate my firm opposition to the proposed bailout of the Detroit automakers; GM, Ford and Chrysler. In truth, this 25 billion dollar bailout is really a UAW bailout.  We’ve had enough of bailouts. We’ve had enough intervention, with my tax dollars, into the economy. In fact, the whole subprime mortgage crisis and the subsequent meltdown on Wall Street can all be traced to the corrupt activities of encouraged by the Community Reinvestment Act, ACORN, Fannie and Freddie. 

We’ve had the 700 billion dollar TARP bailout that just working like a real charm. And, somehow, we’re supposed to believe just another 25 billion dollars and we’ll have the Detroit big three automakers back on their feet and millions of Americans just clamoring to buy Fords, Buicks and Dodges. 

These three automakers have been on a slow slide into oblivion for decades. Because all three have never been forced to face up to the fundamental flaws in their business plans. Chief of which is labor costs that far exceeds productivity. 

Further, attaching “strings” will hope to accomplish what? If such “strings” will make the bailout successful, then such modifications of  the current business model would be readily apparent and would be in place with out the prompting  of Congress. Actually, such a business model exists. It’s call filing for bankruptcy; which isn’t the end of the world. There will still be a huge spare part industry for the GM’s, Fords and Cryslers already on the road. The truck divisions of these three companies remain viable and will have a ready market in any bankrupcy action. Moreover, there exists a huge automobile manufacturing infrastructure in the United States–domestic plants turning out Toyota, Nissans and Honda that Americans really want to buy. Domestic plants that hire thousands of Americans and spin off all sorts of business in their respective communities.

And, what other strings will be attached. Mandates to produce “green” cars, running on “alternate” fuels. Mandates to produce cars to meet cap and trade global warming goal? Never mind that global warming is a crock. Look at how the CAFE standards have distorted the market. Now, we’re going to mandate the production econoboxes that nobody wants if it weren’t for the artificial constraints on domestic oil production for a commodity, oil, that is in reality cheap and plentiful. And, come the day that oil does indeed run out, the market will readily identify a replacement far faster than any intelletoid bureaucrat. With all due respect, what does any one in the House or Senate really know about the thermodynamics and engineering that goes into designing a car or truck. You and I know that these “strings” will be an attempt to legislate car design. Not only will we have a UAW salary subsidy but we will have cars you couldn’t give away. May I suggest that said car be called the Lada.

If you insist on a bailout, lets just be honest and call it a $30 per hour UAW salary subsidy. Why don’t we just reimburse the Detroit big three automakers $30 per hour for its UAW employees and at least put the real reason for this bailout out into the light of day.

The GOP has taken a drubbing at the polls over the last two election cycles with some justification because is has strayed far from the fundamental principles of frugality with tax dollars, low taxes, low regulation and small government. When the subprime financial meltdown hit last September, the GOP no longer had the credibility to stand before the voters and speak the truth about Fannie and Freddie corruption. 

Therefore, now is the time to return to those small government roots and make a principled stand against further government intervention in the private sector. This is no longer the time to “split the difference” or “reach across the aisle.” This is the time to make bright-line distinctions and to put an end to any further use of tax dollars to bail out any business failure that happens to be big enough to hire armies of lobbyists. 

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Obama’s Legacy; It Ain’t Nancy’s Problem

Posted in democratic party, economics, environment, gop, obama, politics, republican party by mountainmusings on November 19, 2008

The Democratic overreaching begins. It looks like Waxman is going to oust Dingell as chairman of the Energy and Commerce Committee. What we have is the hard left of the Democratic party driving policy; in this case energy policy with complete obeisance to the environmentalists. Translation, global warming with cap and trade.

So, just when the economy is tanking, we’re going to be faced with artificially high energy prices to “encourage” us to switch to “alternate, green” energy. This encouragement will be in the form of the return of four-dollar plus gasoline. If this represents a pattern we’ll see more killer tax and spending policies coming out of other parts of Pelosi’s Congressional Empire.  

Obama’s, like pirate Jack Sparrow, has just been tossed up on a desert isle with a pistol and one bullet. He’s all alone. What Obama will have to realize is that his getting into subsidized housing on 1600 Pennsylvania is all and the entire bone that the Democratic leadership is willing to give to its black constituency. As far as they’re concerned, the legacy of Obama is getting elected. Whether he’s successful in his own right is not their problem.

From Pelosi’s and Reid’s point-of-view, picking off enough Republican Senate and Congressional seats and putting Obama in the White House was to give them the running room to pass their agenda. And, in particular, before any backlash in the 2010 mid-term elections, jam as much stuff through this two-year window of opportunity. For Pelosi in particular, and her power barons in the House leadership, being almost immune to any voter backlash, they will have their agenda and to hell with the other rats, Democratic and Republican, on the sinking ship. Obama’s going to have to realize he’s one of those rats that Pelosi could give a rat’s ass about.

Obama’s no longer from a safe seat. His legacy, if he wants a positive one, will require more that being a first in the form of high melanin content. He will need a track record of accomplishment to secure a real place in the history books. A record of accomplishment that will secure him a second term. A record of accomplishment that will allow him to retain running room with regards to working with congress. A record of accomplishment that will allow him to pull a country out of a recession and not degenerate into a depression; and not have his one-term presidency tarred as Hoover II (or Carter II).

In short, Obama will need to realize that he no longer lives in the bubble of pre-ordained elections of the Chicago Democratic machine. He needs to truly in the center and start playing football between the 40 yard lines. Frankly, he need Senator McConnell, his GOP caucus and enough blue-dog Democrats to form a governing coalition. Reid, Pelosi, Dodd, Schumer, Frank, Rangell are not his friends. 

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Pelosi Motors, Inc.

Posted in economics by mountainmusings on November 18, 2008

Just another 25 billion dollars and GM is going to get over the hump and make cars that are going to have the American public stampeding the Chevy showrooms. Try 25 billion dollars to prop up the UAW.

But, how did we get here anyway. It was once remarked by PJ O’Rourke, at a debate at the Cambridge Union about smoking as to how routine decisions, once personal, are now political. Which is what transportation has become. The simple act of buying a car and filling it up with gas is now at the end of pipeline of some of the most convoluted series of political decisions. Even to the point that you get evil looks and sneers for driving a truck or an SUV.

It’s getting to the point that taking a crap is going to be a political statement. Oh, it is! I’m just plunging my stopped up, federally mandated, low-flow toilet again.

Once upon a time, Detroit made good cars. Cars that people wanted because there was a relatively unimpeded communication between the buyer and producer as to what we actually wanted. 

So let’s do the autopsy. First, America ain’t Europe. Yet somehow, our elites regard the ideal car for the unwashed masses  as a little tin-foil, disposable-diaper econo-box with pie pan wheels. Maybe this works for Europe since population densities are far higher, sometimes approaching 1000 persons per square mile. While this density may be approached in the cores of our major cities, the minute you move out of the central cities things start to spread out.

They spread out in neighborhoods where people live in single family homes with real back yards. Our population density is about 80 persons per square mile; so things really spread out. You will travel longer distances and out of practicality, combine errands. Guess what, you need a bigger car. It doesn’t take some intellictoid at the Department of Energy or Transportation to figure that out. It was figured out, in the free market, through the buying and selling of actual cars. Imagine that people made decisions based on their personal needs.

Back when the space shuttle broke up over on re-entry, it dumped umpteen tons of stuff over Texas and Louisiana. But, nobody got hit by the stuff. Urban Sprawl?

Labor Unions. These are not sacrosanct organizations. Rather, they are organizations where members are allowed to collude in withholding labor to bid up the price of their labor. Anybody else try that stunt and you’d have the FTC all over your butt on anti-trust. All a labor union is is a legal exception to the Sherman anti-trust act. The monopoly exercised by the Detroit Big Three and the UAW in the 1950’s came only because of the lack of auto manufacturing capability as a result of the destruction of WW II. But, even then, I suspect that there was an emphasis to build bigger cars because a larger profit margin was needed to compensate for larger UAW labor costs. The demand for smaller cars was left unfilled and along came the imports.

This also made Detroit a Johnny-one-tune. If you want a big car or truck, Detroit’s the place. It still is. If you really need a large vehicle, you can’t beat the full size pick-ups made by the big three; though Toyota and Nissan are beginning to nudge into that area.

But, capable of only of only being profitable with larger vehicles, Detroit could not hope to cope with the politization of energy.

On one hand, the enviro-elite are conducting a jihad against the internal combustion engine (except for their own SUV’s like the one Obama has). They would like nothing less than $4 per gallon gas like we had last summer. And, if they could get away with it politically, they’d be taxing the dickens out of gas to European levels. So, the tax option out, the act of energy extraction has been politicized to make a shortage of a plentiful commodity. For all the talk of running out of oil, we seen to keep making new discoveries.

On the other hand, we have yet another Democratic party special interest group; the UAW. So, the only way to prop up the UAW and keep the enviros happy is to turn the Detroit Big Three into welfare agencies. None of our domestic automakers have been forced to confront the UAW over wage demands that outstrip any reasonable expectations of productivity. Between, the Chrysler bail out of the 1980’s or the import quotas of a similar era, there have been government interventions to preserve the UAW status quo. You could sort of do the status quo while gasoline remained under $2 per gallon. Then, in the name of global warming, the entire charade was upended since you couldn’t have your cake and eat it–cheap gas for big trucks and SUV’s and expensive gas to force a transition to “alternative,” “green,” and/or “renewable” fuels. And, there’s the simple thermodynamic fact of life that the most efficient was to carry portable BTU’s is a tank of gas.

Solution? Further fund the GM/UAW welfare program. There will always be a demand, and therefore jobs, for large vehicles. Joe-the-plumber will always need a full-sized pickup to deliver and install your designer Toto low-flow toilet. And, Al Gore and other prominent Democratic politicians will always need “rugged” vehicles as props to look “outdoorsey.” But, the carrying costs of the UAW make the production of cars a non-starter. So, we pony up 25 billion dollars to subdize the UAW making overpriced cars no one wants.

And, this is how we have our cake and eat it. We stop exploration of oil and gas to jack up gas prices and force transition to underpowered, very expensive battery powered cars that no one really wants but for the artificially high price of gas. Then we spend a lot of tax dollars to pay overprice UAW members to keep making cars that can’t compete in today’s high gas price environment. 

Thank heavens that the sexual revolution as progressed as far as it has since the late 50’s since “doing it” in the back seat of your father’s ‘59 Buick becomes a real contortionist act in the back seat of a Prius. After all, only the missionary position was legal back then.

 

 

 

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Barackonmics; Upstairs, Downstairs

Posted in economics, politics by mountainmusings on November 14, 2008

It’s been remarked elsewhere that the winning coalition of Obama’s presidential victory was a bottom/top coalition.  That is, a coalition of the top and bottom of the economic ladder.

The interesting thing about this coalitions is that both are relatively immune to the economic vissicitudes that affect everyone else in the middle. 

For, the bottom, we have people on various welfare and governmental aid programs. They are net consumers of other people’s taxes. Not much more to be said except that Bush’s “compassionate conservatism” did little to reduce the number of these individuals. These folks represent a permanent constituency of the party of big government. Maybe, the next time, the GOP really needs to give the taxpayer a real break by seriously culling out the government-handout class.

The high end is more interesting. The super rich, and even the moderately rich, derive income streams from other than wages. So, things like Social Security and Medicare taxes don’t matter. If a trust or other compensation agreement is so arranged, a lot of expenses can be had on pre-tax dollars. So, raising income taxes has the perverse effect of enhancing those benefits. I be willing to bet that Al Gore’s giant carbon-footprint private jet isn’t coming out of post-tax dollars.

What is interesting is how country club Republicans became country club Democrats. The first reason is tribute. The need to own the candidate to protect their fortunes and station. Short of a reign of terror mass beheading, these folks don’t really have to worry about much of Obama’s tax plans since the cost will be a small price to pay for the security of their position and station in society. It also helps, that Obama is now, with his house and book deals, very much part of the ancien reigime. Robespierre? 

The second issue is the conceit of 30 years of prosperity thanks to Reagan. Many of these individuals did very well in a variety of business endeavors thanks to Reagan’s policies of economic growth. Now, financially secure, they can dally in the idiocies of global warming and whatever other vogue causes that strike their fancies; the idle mind is indeed the devil’s workshop.

Then, there’s the issue of slamming the door behind to keep others from horning in on their positions of power and influence. Most of these well-to-do Obama supporters are very well aware of the radicalness of capitalism; since their successes (or those of their immediate ancestors) came from business successes that in some way overturned the established order. Bill Gates, for example, is very wealthy because of his upsetting the cozy world of IBM. So, these people turn to the ideology of societal ossification; socialism.

In many ways, Obama’s hometown of Chicago, represents the very top/bottom economic structure that gave him the presidency. On the bottom are the governmental dependents; patronage workers and welfare. And, ward heelers, er, community organizers, to make sure they vote the right way for the Chicago political machine.

On the top are the wealthy. Nominally Republican, except when doing business in Chicago. They contribute and they pose with the machine politicians; as pillars of the community. But, there are understandings. Understanding like Obama’s sweetheart mortgage deal from the Northern Trust. Of course, you’ll never see ACORN raising a ruckus in Northern Trust’s lobby; that reserved for some mom-and-pop Savings and Loan back in the neighborhood struggling to survive without any hope for bailout bucks. Of course, the elite will never be seen in the Chicago public schools; they have their own private schools or, just over the Chicago border, their elite public schools. As you move up in the machine, you’re rewarded richly but expected to “understand” there are just some things you just don’t touch. Obama’s been a good and loyal foot soldier and has been richly rewarded for this service; nice house in Hyde Park and a nicer one now on the East Coast.

Here’s how thick it gets. Obama’s pal Bill Ayers was no radical who worked his way up from the mean streets, he’s the son of Thomas Ayers, former CEO of Commonwealth Edison, now Exelon.