By Don Boudreaux
Citibank will now reject delivery of a corporate jet. As reported in yesterday's Washington Times, "Pressure to cancel the deal came from the Obama administration and amid a chorus of concerns from politicians who are worried about how banks that have received federal funds are spending the money."
Overlook the sad fact that bailout money is being used to exponentially expand the scope of market activities over which government exercises direct control, and instead ask: Does no one see the sick hypocrisy here? A man who flies in a private jet paid for exclusively with taxpayer funds (Air Force One) scolds other persons for flying in private jets paid for only in part with taxpayer funds.
Friday, January 30, 2009
Thursday, January 29, 2009
Another "Quasi-Governmental" Pig At The Trough?
http://money.cnn.com/2009/01/28/news/economy/postal_service/index.htm
Tuesday, January 27, 2009
Coming Inflation?
The banks are sitting on a huge increase in the money supply, as the chart shows (click on the chart to enlarge). They have not loaned it because of their bad balance sheets (i.e., big losses in the recent past and anticipation of future losses). The Fed has been paying them to keep the cash in reserve. If/When it makes it way into the economy, inflation will likely go through the roof.
Monday, January 26, 2009
Sunday, January 25, 2009
The Declaration Of Dependence
By Don Boudreaux on Current Affairs
President Barack Obama's inaugural declaration that "The question we ask today is not whether our government is too big or too small, but whether it works" is further evidence that the wisdom and values that animated America's founding generation are lost - evidence that too few Americans today possess a mature skepticism of power and a love of liberty, and that too many Americans today are subject to adolescent crushes on charismatic charmers.
If Thomas Jefferson thought as Mr. Obama does, he would have written in 1776:"We hold this truth to be self-evident, that all men are endowed by their government with the unalienable right to be taxed, subsidized, regulated, lectured, scolded, herded, harassed, and otherwise ruled in whatever wayswork."
And these soaring words would have been part of a Declaration of Dependence.
President Barack Obama's inaugural declaration that "The question we ask today is not whether our government is too big or too small, but whether it works" is further evidence that the wisdom and values that animated America's founding generation are lost - evidence that too few Americans today possess a mature skepticism of power and a love of liberty, and that too many Americans today are subject to adolescent crushes on charismatic charmers.
If Thomas Jefferson thought as Mr. Obama does, he would have written in 1776:"We hold this truth to be self-evident, that all men are endowed by their government with the unalienable right to be taxed, subsidized, regulated, lectured, scolded, herded, harassed, and otherwise ruled in whatever wayswork."
And these soaring words would have been part of a Declaration of Dependence.
Saturday, January 24, 2009
Thursday, January 22, 2009
Wednesday, January 21, 2009
A Letter To The Wall Street Journal Regarding The Next Bailout
Dear WSJ: Obama Calls for Responsibility, While Acting Irresponsibly
'No one can spend $1.5 billion of other people's money responsibly.'
By Donald J. Boudreaux
Business & Media Institute
1/20/2009 10:52:07 AM
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
To the Editor:
You report that Barack Obama will call for "a new era of responsibility" ("Obama to Call for a New Era of Responsibility," Jan. 20).
His actions belie his words. By seeking an extra $800 billion for "stimulus," Mr. Obama will generate a typhoon of irresponsibility. Consider what Arnold Kling says at the blog EconLog: "How many people will have meaningful input in determining the overall allocation of the billion stimulus? 10? 20? It won't be more than 1000. These people - let's say that in the end 500 technocrats will play a meaningful role in writing the bill - will have unimaginable power. Remember that what they are doing is taking our money and deciding for us how to spend it. Presumably, that is because they are wiser at spending our money than we are at spending it ourselves.
"The arithmetic is mind-boggling. If 500 people have meaningful input, and the stimulus is almost $800 billion, then on average each person is responsible for taking more than $1.5 billion of our money and trying to spend it more wisely than we would spend it ourselves."
Absolutely no one can spend $1.5 billion of other people's money responsibly.
Sincerely,
Donald J. Boudreaux
Don Boudreaux is the Chairman of the Department of Economics at George Mason University and a Business & Media Institute adviser
'No one can spend $1.5 billion of other people's money responsibly.'
By Donald J. Boudreaux
Business & Media Institute
1/20/2009 10:52:07 AM
Editor, The Wall Street Journal
200 Liberty Street
New York, NY 10281
To the Editor:
You report that Barack Obama will call for "a new era of responsibility" ("Obama to Call for a New Era of Responsibility," Jan. 20).
His actions belie his words. By seeking an extra $800 billion for "stimulus," Mr. Obama will generate a typhoon of irresponsibility. Consider what Arnold Kling says at the blog EconLog: "How many people will have meaningful input in determining the overall allocation of the billion stimulus? 10? 20? It won't be more than 1000. These people - let's say that in the end 500 technocrats will play a meaningful role in writing the bill - will have unimaginable power. Remember that what they are doing is taking our money and deciding for us how to spend it. Presumably, that is because they are wiser at spending our money than we are at spending it ourselves.
"The arithmetic is mind-boggling. If 500 people have meaningful input, and the stimulus is almost $800 billion, then on average each person is responsible for taking more than $1.5 billion of our money and trying to spend it more wisely than we would spend it ourselves."
Absolutely no one can spend $1.5 billion of other people's money responsibly.
Sincerely,
Donald J. Boudreaux
Don Boudreaux is the Chairman of the Department of Economics at George Mason University and a Business & Media Institute adviser
Tuesday, January 20, 2009
On Property Taxes
By Sheldon Richman
"Apologists for government undertake bizarre mental contortions to show that we have consented to be taxed. Balderdash. I was never asked to consent, and I’m sure you weren’t either. I refuse to accept the nonsensical argument that by not vacating the parcel of land I purchased, I have signaled my “tacit consent” to be plundered and bullied. That implies the government owns the territory it rules and therefore can set the conditions under which it is used. That sounds like feudalism. Are we merely tenants of the governmental landlord?"
"Apologists for government undertake bizarre mental contortions to show that we have consented to be taxed. Balderdash. I was never asked to consent, and I’m sure you weren’t either. I refuse to accept the nonsensical argument that by not vacating the parcel of land I purchased, I have signaled my “tacit consent” to be plundered and bullied. That implies the government owns the territory it rules and therefore can set the conditions under which it is used. That sounds like feudalism. Are we merely tenants of the governmental landlord?"
Monday, January 19, 2009
Republicans for Clinton
by Laurence Vance at January 18, 2009 03:22 PM
"They aren't even acting like Republicans when they are out of power. When Clinton was president, some Republicans acted like the conservatives they claimed to be. Then, when Bush was elected and they enjoyed an absolute majority for much of his terms, the Republicans showed their true colors--big government statists just like the Democrats.
Since the day her husband became the president, the personification of evil according to all Republicans has been Hillary Clinton. So, what did the Republicans do when Mrs. Clinton appeared before the Senate Foreign Relations Committee to receive the first vote toward her confirmation as secretary of state? With but one exception (David Vitter of Louisiana), the Republicans on the committee voted for Hillary.
Here are the pathetic Republicans on the committee who voted for what they claimed for years was the personification of evil: Richard Lugar, Bob Corker, George Voinovich, Lisa Murkowski, Jim DeMint, Johnny Isakson, John Barrasso."
"They aren't even acting like Republicans when they are out of power. When Clinton was president, some Republicans acted like the conservatives they claimed to be. Then, when Bush was elected and they enjoyed an absolute majority for much of his terms, the Republicans showed their true colors--big government statists just like the Democrats.
Since the day her husband became the president, the personification of evil according to all Republicans has been Hillary Clinton. So, what did the Republicans do when Mrs. Clinton appeared before the Senate Foreign Relations Committee to receive the first vote toward her confirmation as secretary of state? With but one exception (David Vitter of Louisiana), the Republicans on the committee voted for Hillary.
Here are the pathetic Republicans on the committee who voted for what they claimed for years was the personification of evil: Richard Lugar, Bob Corker, George Voinovich, Lisa Murkowski, Jim DeMint, Johnny Isakson, John Barrasso."
Sunday, January 18, 2009
Even More Socialism On The Way?
Posted by Bill Anderson at January 17, 2009 07:54 PM
Nearly a century after the creators of the Federal Reserve System believed they had given the banking system its "magic bullet," today's government geniuses are proposing the next logical step: a government bank. No, I am not kidding:
WASHINGTON (Reuters) - The incoming Obama administration is considering setting up a government-run bank to acquire bad assets clogging the financial system, a person familiar with the Obama team's thinking said on Saturday.
The U.S. Federal Reserve, Treasury and Federal Deposit Insurance Corp have been in talks about ways to ease a banking crisis that is once again deepening -- and a government-run "aggregator bank" is among the options.
Outgoing Treasury Secretary Henry Paulson and FDIC Chairman Sheila Bair both said on Friday a government bank was one of a number of ideas U.S. regulators had been discussing.
The source said advisers to President-elect Barack Obama, who takes office on Tuesday, were also considering the idea of an aggregator bank among a range of options that could be pursued.
David Axelrod, a top adviser to Obama, told Reuters the new administration would have something to say about a fresh approach to the financial crisis in "the next few days."
Oh, yes, socialism is a "fresh approach." Yeah, it is "fresh" the same way that a newly-created cowpie is "fresh." I hate to tell these geniuses that a government bank is going to be enmeshed in all sorts of corruption and political pressures before long. However, like the Tennessee Valley Authority, it never will go out of business, just as long as there is a living, breathing taxpayer to squeeze.
Nearly a century after the creators of the Federal Reserve System believed they had given the banking system its "magic bullet," today's government geniuses are proposing the next logical step: a government bank. No, I am not kidding:
WASHINGTON (Reuters) - The incoming Obama administration is considering setting up a government-run bank to acquire bad assets clogging the financial system, a person familiar with the Obama team's thinking said on Saturday.
The U.S. Federal Reserve, Treasury and Federal Deposit Insurance Corp have been in talks about ways to ease a banking crisis that is once again deepening -- and a government-run "aggregator bank" is among the options.
Outgoing Treasury Secretary Henry Paulson and FDIC Chairman Sheila Bair both said on Friday a government bank was one of a number of ideas U.S. regulators had been discussing.
The source said advisers to President-elect Barack Obama, who takes office on Tuesday, were also considering the idea of an aggregator bank among a range of options that could be pursued.
David Axelrod, a top adviser to Obama, told Reuters the new administration would have something to say about a fresh approach to the financial crisis in "the next few days."
Oh, yes, socialism is a "fresh approach." Yeah, it is "fresh" the same way that a newly-created cowpie is "fresh." I hate to tell these geniuses that a government bank is going to be enmeshed in all sorts of corruption and political pressures before long. However, like the Tennessee Valley Authority, it never will go out of business, just as long as there is a living, breathing taxpayer to squeeze.
Friday, January 16, 2009
A Great Cartoon
http://www.youtube.com/watch?v=NbTIJ9_bLP4&eurl=http://www.garynorth.com/public/1769.cfm
So You Wonder Why Your Retirement Is Gone
From Gary North
In December, Portfolio.com published a fascinating essay by Michael Lewis, "The End." Two decades ago, Lewis became an overnight sensation with his book, "Liar's Poker." It was a study of the hottest of hot shot investment bankers. The term, "liar's poker," got into common usage.
His article features one of the cleverest pieces of art work I have ever seen. It is a morphed image of the famous bronze bull on Wall Street, located just outside the New York Stock Exchange. The bull is on its side, dead.
Lewis begins with a description of his three years at Salomon Brothers, beginning in 1985.
"I'd never taken an accounting course, never run a business, never even had savings of my own to manage. I stumbled into a job at Salomon Brothers in 1985 and stumbled out much richer three years later, and even though I wrote a book about the experience, the whole thing still strikes me as preposterous -- which is one of the reasons the money was so easy to walk away from. I figured the situation was unsustainable. Sooner rather than later, someone was going to identify me, along with a lot of people more or less like me, as a fraud. Sooner rather than later, there would come a Great Reckoning when Wall Street would wake up and hundreds if not thousands of young people like me, who had no business making huge bets with other people's money, would be expelled from finance."
In December, Portfolio.com published a fascinating essay by Michael Lewis, "The End." Two decades ago, Lewis became an overnight sensation with his book, "Liar's Poker." It was a study of the hottest of hot shot investment bankers. The term, "liar's poker," got into common usage.
His article features one of the cleverest pieces of art work I have ever seen. It is a morphed image of the famous bronze bull on Wall Street, located just outside the New York Stock Exchange. The bull is on its side, dead.
Lewis begins with a description of his three years at Salomon Brothers, beginning in 1985.
"I'd never taken an accounting course, never run a business, never even had savings of my own to manage. I stumbled into a job at Salomon Brothers in 1985 and stumbled out much richer three years later, and even though I wrote a book about the experience, the whole thing still strikes me as preposterous -- which is one of the reasons the money was so easy to walk away from. I figured the situation was unsustainable. Sooner rather than later, someone was going to identify me, along with a lot of people more or less like me, as a fraud. Sooner rather than later, there would come a Great Reckoning when Wall Street would wake up and hundreds if not thousands of young people like me, who had no business making huge bets with other people's money, would be expelled from finance."
Thursday, January 15, 2009
Quote Of The Day
Every decent man is ashamed of the government he lives under.
H. L. Mencken
US editor (1880 - 1956)
H. L. Mencken
US editor (1880 - 1956)
Wednesday, January 14, 2009
Huffington Post on Ron Paul
Ben Cohen writes in HuffPo about "10 Republicans who should stick around.' Here he is on Ron Paul:
Ron Paul won pretty much every Republican debate hands down, proving that brains and ideas won't get you far in the GOP. The doctor from Texas ultimately failed because he decided to tell the truth about the massive hypocrisy and corruption of the Republican Party, and tried to offer something similar to the original Republicanism of small government, civil liberties, and a humble foreign policy. Paul's small government libertarianism may be outdated (probably by a hundred years or so), but his analysis of the United States fiscal and foreign policy were incredibly accurate and insightful.
On Bush's version of capitalism, Paul said:
Deficits mean future tax increases, pure and simple. Deficit spending should be viewed as a tax on future generations, and politicians who create deficits should be exposed as tax hikes.
On the war in Iraq, Paul less kind:
Cliches about supporting the troops are designed to distract from failed policies, policies promoted by powerful special interests that benefit from war, anything to steer the discussion away from the real reasons the war in Iraq will not end anytime soon.
Amen. Please stick around, Ron.
Ron Paul won pretty much every Republican debate hands down, proving that brains and ideas won't get you far in the GOP. The doctor from Texas ultimately failed because he decided to tell the truth about the massive hypocrisy and corruption of the Republican Party, and tried to offer something similar to the original Republicanism of small government, civil liberties, and a humble foreign policy. Paul's small government libertarianism may be outdated (probably by a hundred years or so), but his analysis of the United States fiscal and foreign policy were incredibly accurate and insightful.
On Bush's version of capitalism, Paul said:
Deficits mean future tax increases, pure and simple. Deficit spending should be viewed as a tax on future generations, and politicians who create deficits should be exposed as tax hikes.
On the war in Iraq, Paul less kind:
Cliches about supporting the troops are designed to distract from failed policies, policies promoted by powerful special interests that benefit from war, anything to steer the discussion away from the real reasons the war in Iraq will not end anytime soon.
Amen. Please stick around, Ron.
Monday, January 12, 2009
As The Bush Days Wind Down
He left off the list: Killed the Republican Party for the foreseeable future. Now if Obama can do the same for the Democrat Party, we might have a chance.
By Bill Anderson at January 12, 2009 01:30 PM
Fred Barnes continues the Neocon lovefest with Bush, reminding us in the Weekly Substandard that Bush really was a great president. Barnes lists 10 Great Things that Bush did in his eight years, including:
1. He stood against "global warming." (He did?)
2. "Enhanced interrogations" of "terrorists." (What the ancients once called torture.)
3. "The rebuilding of presidential authority." (Let none call it dictatorship.)
4. "Unswerving support for Israel." (What Israel wants, Israel gets.)
5. The No Child Left Behind Act. (Oh, yes, this legislative fraud is a mark of greatness.)
6. Promoting democracy abroad. (And destroying it at home, like his fellow Jacobins.)
7. "The Medicare prescription drug benefit." (Please, no. Not this one. Rove said passage would help ensure Republican dominance in government for decades, another Social Security Act. Gotta love these "political geniuses.")
8. "John Roberts and Sam Alito." (Of course. Why had I not thought about that? Two guys who believe in Government uber alles and are not afraid to rule that way.)
9. "He strengthened relations with east Asian democracies (Japan, South Korea, Australia) without causing a rift with China." (Yeah, and I bet they are soooo grateful to King George.)
10. "Finally, a no-brainer: the surge." (True, one does not need a brain to support the "surge." Glad we agree on something, Fred.)
By Bill Anderson at January 12, 2009 01:30 PM
Fred Barnes continues the Neocon lovefest with Bush, reminding us in the Weekly Substandard that Bush really was a great president. Barnes lists 10 Great Things that Bush did in his eight years, including:
1. He stood against "global warming." (He did?)
2. "Enhanced interrogations" of "terrorists." (What the ancients once called torture.)
3. "The rebuilding of presidential authority." (Let none call it dictatorship.)
4. "Unswerving support for Israel." (What Israel wants, Israel gets.)
5. The No Child Left Behind Act. (Oh, yes, this legislative fraud is a mark of greatness.)
6. Promoting democracy abroad. (And destroying it at home, like his fellow Jacobins.)
7. "The Medicare prescription drug benefit." (Please, no. Not this one. Rove said passage would help ensure Republican dominance in government for decades, another Social Security Act. Gotta love these "political geniuses.")
8. "John Roberts and Sam Alito." (Of course. Why had I not thought about that? Two guys who believe in Government uber alles and are not afraid to rule that way.)
9. "He strengthened relations with east Asian democracies (Japan, South Korea, Australia) without causing a rift with China." (Yeah, and I bet they are soooo grateful to King George.)
10. "Finally, a no-brainer: the surge." (True, one does not need a brain to support the "surge." Glad we agree on something, Fred.)
Sunday, January 11, 2009
And You Thought Some Businesses Were Recession-Proof
Adult Entertainment Industry Wants a Bailout
http://www.foxbusiness.com/story/markets/economy/adult-entertainment-industry-wants-bailout/
http://www.foxbusiness.com/story/markets/economy/adult-entertainment-industry-wants-bailout/
Saturday, January 10, 2009
Bush Or Obama - Government Stimulus As A Tool Is Failing
Click on the graph to enlarge it. Government stimulus efforts are already immoral because they pass on to future generations debt obligations that they had no say in incurring. Soon, government stimulus efforts will also have no impact on current GDP. Turmoil will follow.
Wednesday, January 7, 2009
Soon It Will Be Time To Invest In Real Estate
Mortage rates are now below 5% for people with good credit. If you want to invest in properties in Indiana, I would be more than happy to assist as your broker.
http://www.allheadlinenews.com/articles/7013609484
http://www.allheadlinenews.com/articles/7013609484
Monday, January 5, 2009
I Was Wondering When This Would Happen
These shows drive me crazy with claims that defy all economic sense. For example, why would prospective buyers of a house pay more for an upgrade performed by the current owner than the buyers could have it done to their specifications themselves? However, the article is tongue-in-cheek, as it should be.
Blame Television for the Bubble
The real housing villain is on cable.
By JIM SOLLISCH
So now we know what happens when too many people who have too few assets buy too much house with the help of too many risky mortgage products and too little oversight. And while there's plenty of blame to go around -- unethical mortgage brokers, greedy bankers and irresponsible homeowners -- one culprit continues to get off scot-free: HGTV.
That's right. The cable network HGTV is the real villain of the economic meltdown. As the viewership reached a critical mass over the past decade -- HGTV is now broadcast into 91 million homes -- homeowners began experiencing deep angst. Suddenly no one but the most slovenly and unambitious were satisfied with their houses. It didn't matter if you lived in an apartment or a gated community, one episode of "House Hunters" or "What's My House Worth?" and you were convinced you needed more. More square feet. More granite. More stainless steel appliances. More landscaping. More media rooms. More style. You deserved it.
If you had any doubts about your ability to afford such luxuries, all you had to do was look at the 20-something couple in the latest episode choosing between three houses. Should they go for the fixer-upper, priced at $425,000? Or the one with the pool for $550,000? What about the one with room to grow for $675,00?
"How much money can these people possibly make?" I shout at my wife before wrestling the remote from her house-hungry little hand and switching it to the nearest sports program. "The guy can barely string together two sentences!"
And yet on episode after episode for this entire irrational decade, HGTV pumped up the housing bubble by parading the most mediocre, unworthy-looking homeowners into our living rooms to watch while they put their tacky, run-of-the-mill tract homes on the market for twice what they paid and then went out and bought houses with price tags too obscene to repeat. You couldn't watch these shows without concluding that you must be an idiot and a loser if you lived in a house you could actually afford.
HGTV is an evil empire that never rests. You can loathe your current domicile 24/7 with programs such as "Stagers" (move a few things around and double the value of your home); "Designed to Sell" (you can sell your house, even if the house next to yours is in foreclosure); "Design on a Dime" (see, it's cheap); and "Property Virgins" (losing your virginity was fun, wasn't it?) Every show features highly attractive hosts who show you how to "unlock the hidden potential" in your home, how to turn a $10 thrift-store table into a "wow" media center, and how to make everything "pop." Pop is the word of choice on HGTV.
Ironic, isn't it, given the fact that pop is the sound we keep hearing from the McMansion-sized housing bubble HGTV created.
Blame Television for the Bubble
The real housing villain is on cable.
By JIM SOLLISCH
So now we know what happens when too many people who have too few assets buy too much house with the help of too many risky mortgage products and too little oversight. And while there's plenty of blame to go around -- unethical mortgage brokers, greedy bankers and irresponsible homeowners -- one culprit continues to get off scot-free: HGTV.
That's right. The cable network HGTV is the real villain of the economic meltdown. As the viewership reached a critical mass over the past decade -- HGTV is now broadcast into 91 million homes -- homeowners began experiencing deep angst. Suddenly no one but the most slovenly and unambitious were satisfied with their houses. It didn't matter if you lived in an apartment or a gated community, one episode of "House Hunters" or "What's My House Worth?" and you were convinced you needed more. More square feet. More granite. More stainless steel appliances. More landscaping. More media rooms. More style. You deserved it.
If you had any doubts about your ability to afford such luxuries, all you had to do was look at the 20-something couple in the latest episode choosing between three houses. Should they go for the fixer-upper, priced at $425,000? Or the one with the pool for $550,000? What about the one with room to grow for $675,00?
"How much money can these people possibly make?" I shout at my wife before wrestling the remote from her house-hungry little hand and switching it to the nearest sports program. "The guy can barely string together two sentences!"
And yet on episode after episode for this entire irrational decade, HGTV pumped up the housing bubble by parading the most mediocre, unworthy-looking homeowners into our living rooms to watch while they put their tacky, run-of-the-mill tract homes on the market for twice what they paid and then went out and bought houses with price tags too obscene to repeat. You couldn't watch these shows without concluding that you must be an idiot and a loser if you lived in a house you could actually afford.
HGTV is an evil empire that never rests. You can loathe your current domicile 24/7 with programs such as "Stagers" (move a few things around and double the value of your home); "Designed to Sell" (you can sell your house, even if the house next to yours is in foreclosure); "Design on a Dime" (see, it's cheap); and "Property Virgins" (losing your virginity was fun, wasn't it?) Every show features highly attractive hosts who show you how to "unlock the hidden potential" in your home, how to turn a $10 thrift-store table into a "wow" media center, and how to make everything "pop." Pop is the word of choice on HGTV.
Ironic, isn't it, given the fact that pop is the sound we keep hearing from the McMansion-sized housing bubble HGTV created.
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