Economic Contradiction

Posted on 2009-06-12 by David

Paul Krugman and I agree on little politically (I have at times agreed with him when he was arguing that TARP was a bad idea – although we disagreed on the reasons why) and despite the fact that my assumptions about the nature of sound economics differ from his most of the time I recognize that he has a lot of expertise in the field that I can learn from. For example, I have not known enough about economics to be aware of the Setser point that he is looking at. For those like me who are new to the term, the idea is this:

high government borrowing is more than offset by net negative borrowing from the private sector

As far as I can tell, Krugman is among those who believe that the flow of money defines the health of the economy – the more the money moves (borrowing, spending, and creating) the healthier the economy. Krugman and those who believe like him will doubtless argue that when the private sector borrowing declines governments must borrow more to keep the economy healthy. In other words, lower private sector borrowing causes (or rather necessitates) higher government borrowing. Unfortunately for them the numbers appear to paint a different story. If the cause and effect relationship is not simply the reverse of that assertion then the relationship is at least symbiotic with governments trying to manage or compensate for the actions of the private sector causing an opposite, but more than equal, reaction as the private sector tries to outguess the government.

On the other hand, I believe that people in the aggregate (meaning many individuals over a sustained period of time) make economically beneficial decisions (not always the best decisions necessarily, but better than rolling government loaded dice).

What the Setser point tells me is that government borrowing drags the economy down because of the opposite but more than equal principle noted by Sester and Krugman and it prolongs the agony when those in the private sector – for whatever reason – determine that we need to slow the borrowing to set the economy back on a fundamentally sound foundation.

Posted in General | Tagged , , , , , | Leave a comment

Hate Crime

Posted on 2009-06-11 by David

I keep thinking about the tragedy at the Holocaust Museum yesterday. I find it tragic and unfortunate that the security guard is the one who has died while the assailant is still alive. I have heard that authorities are considering whether this was a hate crime. Personally I think that it is painfully obvious that this was a hate crime but has me thinking once again that there is no reason that hate crimes should be treated differently than any other crime.

Imagine if the security officer had been killed in the midst of a robbery. In that case this would not be a hate crime, but the officer would be just as dead as he is now so the incident is no less tragic and the crime no less grievous. In my mind, if the punishments we dole out for a crime ore not severe enough then we should change the punishments for the crime, not reclassify some instances as “hate crimes.”

The only time that I can see any argument for any legislation against the attitudes and beliefs that we try to prosecute with hate crimes legislation is in the case of speech. I believe it might be possible to draw a line where hateful speech is worthy of criminal prosecution where other inflammatory but not “hate” speech would be protected.

Posted in National | Tagged , , | 2 Comments

Constitutional Amendment 11

Posted on 2009-06-10 by David

The amendments in the Bill of Rights seem to be viewed by many people as part of the original constitution. It looks to me that later amendments can be categorized as either clarifications of the constitution or alterations to it. The Eleventh Amendment would fall under the category of clarification:

The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.

I don’t believe that the founders ever intended to infringe upon the sovereignty of states simply because a citizen of another state had a grievance against them. The initial intent was probably to have an impartial judge of such cases but they discovered that citizens could abuse that clause. Today we need to find ways to stop Congress from abusing some other clauses of the constitution.

Posted in General | Tagged , , , | 3 Comments

Second Amendment Victory

Posted on 2009-06-09 by David

My appreciation for the second amendment just went up another notch. Opponents of gun ownership rights like to argue that guns kill people (for that matter so do hands, cars, T-bone steaks, and many other things) but they never mentioned that gun rights could also kill an illegal house seat for D.C.:

Fights over gun control in Washington, D.C., may have killed for the year a bill that would give Utah a fourth U.S. House seat and give D.C. a House seat with full voting rights.

House Majority Leader Steny Hoyer, D-Md., delivered that message in his weekly briefing for reporters on Tuesday

Apparently leaders in D.C. would rather keep very strict gun control laws than gain an unconstitutional voting seat in the House. If they want to now pursue a path to full House representation that does not sidestep the Constitution I’ll sign the petition at the first opportunity. Residents of D.C. deserve voting congressional representation as much as anyone else, but that does not justify ignoring the fundamental law of the land.

I still can’t believe that 80% of Utah’s congressional delegation fell for this Washington parlor trick. If the bill comes up again in 2010 I hope they will be smart enough to reject it since Utah would only have 1 possible year of representation before we would get another seat anyway (regardless of what Orrin Hatch would tell you about possibly missing it again).

Posted in National, State | Tagged , , , , , | 4 Comments

Banks Giving Back

Posted on 2009-06-09 by David

While it is good news that 10 banks will be allowed to repay billions in bailout funds I would be much more excited if I didn’t already know what was likely to happen as a result.

The banks were deemed strong enough to leave the Troubled Asset Relief Program, or TARP, after months of lobbying and strong performances on recent stress tests. The banks are expected to return about $68.3 billion to the Treasury Department, more than double the administration’s initial estimate of about $25 billion in funds to be returned this year. The timetable is also earlier than government officials originally intended.

. . .

The $68.3 billion represents about a quarter of the TARP money given to banks.

That last figure tells me that we still have over $200 billion illegally given by our government to our banking system.

My lack of enthusiasm for this news comes from two concerns. First, the administration will use this news as evidence that the bailouts are working better/faster than expected. The truth is that the banks have been working furiously to find a way to get rid of that money ever since they read the regulations that came with it. Second, having that money will be used as a way to help fund other illegal activities by the federal government such as propping up the UAW by buying GM (the money being returned covers everything we’ve put into GM so far) and even worse than that is the possibility that some smart government people might take the news as an excuse to say, “hey, we have $68 billion more than we expected,” and then go on to fund another $58 billion in projects that they did not dare to fund previously. That’s like buying a $500 LCD monitor when you can only afford $100 and then buying an $80 printer when the $100 rebate arrives early.

So the banks are giving back more and earlier – that’s good for them (and “good for them” is what they are paid to do) but that does not mean there’s a chance that the government will start giving back or being financially responsible in any way.

Update @1:20pm: Here are a few words from the president today confirming my claim that the administration would use this to show that the bailouts are working better than planned:

Several financial institutions are set to pay back $68 billion to taxpayers. And while we know that we will not escape the worst financial crisis in decades without some losses to taxpayers, it’s worth noting that in the first round of repayments from these companies the government has actually turned a profit.

. . . We’re restoring funds to the Treasury where they’ll be available to safeguard against continuing risks to financial stability. And as this money is returned, we’ll see our national debt lessened by $68 billion — billions of dollars that this generation will not have to borrow and future generations will not have to repay.

He says that the money is being returned to the treasury, but I’m confident it will find a way to sneak out again like a good rebellious teenager despite the president’s best efforts to keep it at home where it belongs. 😉

Posted in National | Tagged , , , | 5 Comments

Online Conservative Desert

Posted on 2009-06-08 by David

I understand that it is a commonly held belief that the political left has more influence in online political activity than the political right. Now we have research by Richard Davis that sheds a bit of light on that.

Davis also queried more than 200 journalists to learn how they use blog content in their coverage of political news. Most journalists were aware of influential blogs on both sides of the political spectrum, such as Daily Kos and Talking Points on the left and Michelle Malkin and Instapundit on the right. Despite equal awareness, journalists spend more time reading posts in the liberal blogosphere.

For example, more journalists know about Michelle Malkin than Talking Points. Yet twice as many journalists actually read Talking Points than read Michelle Malkin.

I wish I could find the article that first alerted me to this research because it included another tidbit of information – in the research into political bloggers a much higher percentage of right-leaning bloggers read left-leaning blogs than the number of left-leaning bloggers reading right-leaning blogs.

From my own experience here in the conservative state of Utah I can say that we have at least as many left-leaning political blogs as we do right-leaning political blogs.

My question is, why is this? Why, even where the political right vastly outnumbers the political left on the ground does the political left still hold an edge over the political right online? My suspicion is that part of the answer lies in the fact that the political left was functionally irrelevant in national politics as the world of online commentary was becoming more powerful and widespread. Those who had less of a voice in running the governments might easily have been more anxious to use these new tools to communicate and respond. The result is that in some ways they have a six year head start in online organization and dialog over those who were content to be holding the reins of office. In those six years and without the luxury of turning away all who would challenge their thinking it is reasonable to expect that they might have a more vibrant and interesting dialog in general than their counterparts. It may not be that most members of the media natively prefer liberal positions, it may be that they and even some of those on the right are simply allergic to immature conversation that has not had time to develop as widely without that head start gained in the political wilderness.

I believe that this needs to be rectified. The online conversation should be a more accurate reflection of the various positions held by those on the ground. Perhaps some time in political irrelevance by the political right might serve as an incentive to create some oases online of fertile conservative conversation which could plant the seeds so that our online desert can blossom as a rose, just like the desert we live in has blossomed in the last 162 years.

Posted in State | Tagged , , | 7 Comments

Anti-Slavery Petition of 1790

Posted on 2009-06-06 by David

In my study of our founding documents I found this Petition from the Pennsylvania Society for the Abolition of Slavery, signed by Benjamin Franklin and published in 1790, to be rather interesting. In the Letter the society asks Congress:

that you will be pleased to countenance the Restoration of liberty to {slaves}, that you will devise means for removing this Inconsistency from the Character of the American People, that you will promote mercy and Justice towards this distressed Race, & that you will Step to the very verge of the Powers vested in you for discouraging every Species of Traffick in the Persons of our fellow men. (emphasis added, capitalization original)

I wondered what they expected Congress to do considering the prohibitions on Congress’ power regarding slavery prior to 1808 as stated at the beginning of Article 1 Section 9 of the Constitution:

The migration or importation of such persons as any of the states now existing shall think proper to admit, shall not be prohibited by the Congress prior to the year one thousand eight hundred and eight, but a tax or duty may be imposed on such importation, not exceeding ten dollars for each person.

I assume that stepping to the very verge of the powers vested in Congress would mean that they wanted Congress to impose a tax of $10 per slave on the importation of new slaves.

Posted in General | Tagged , | 2 Comments

Too Little Too Late

Posted on 2009-06-05 by David

I was not sure whether to gag or chuckle when I heard the news that Senator Bennett wants to prevent the use of TARP money for the auto industry. To me that just sounds like he’s shutting the barn doors after the cows have escaped while insisting that there’s nothing wrong with leaving the stalls open.

Bennett said he also adding wording that would ban using Troubled Asset Relief Program (TARP) bailout money to help bankrupt car makers.

“The TARP money was sold to the Congress as acquiring assets, not as acquiring stock positions in various companies, particularly not in acquiring stock position in a bankrupt manufacturing company,” Bennett said.

“When we approved TARP the first time around, we did it with the understanding that it was dealing with the credit crisis,” he said. “Instead, the TARP money has gone into these bankrupt companies.”

It’s clear to see that Bennett is doing everything he can to show his opposition to federal overspending and government overreaching in the economy while maintaining his position that the original bailout was necessary. I don’t see any reason to even begin to pay attention until he has come out and directly stated that his vote on TARP was absolutely wrong from the beginning. Even if he does, he is wrong if he things that his TARP vote is the only thing dragging on his chances for re-election.

Posted in State | Tagged , , , , , | 6 Comments

Change Done Right

Posted on 2009-06-04 by David

With the news yesterday that New Hampshire passed a law to allow gay marriage I sincerely hope that the proponents of gay marriage may begin to see the right way to bring the change they seek – especially when put in context next to Vermont’s legalization of gay marriage, Maine’s legalization, the setback in the California Supreme Court ruling on Prop. 8, and the reaction to Massachusetts’ Supreme Court decision in 2004. While there has been little if any reaction to those three states that legalized gay marriage through the legislative process there was a large push to overturn the Supreme Court decision in Massachusetts through a state constitutional amendment, and the same approach in California succeeded in rolling back the original Supreme Court decision in California that legalized gay marriage temporarily in 2008.

The point is that the right way to enact these changes is to take the time to educate and convince people so that the change may be made through the legislative process and be accepted rather than simply trying to ram “equality” down the throats of your fellow citizens based on an unwillingness to trudge the long path of education and debate.

Although it may seem quicker to use the courts, we should all remember that cutting off the debate through judicial action has not led to any resolution on the abortion issue even after more than 30 years. It may be that 30 years would be enough to take the “slower” route of education and persuasion to peacefully achieve your goals.

Posted in culture, General, National | Tagged , , , , , , , , | 9 Comments

Constitutional Amendment X

Posted on 2009-06-03 by David

Up until the last few months, when states have started to assert their rights through such actions as resolutions and the formation of the Patrick Henry Caucus, I am convinced that the Tenth Amendment has long been the most widely ignored of our Bill of Rights amendments.

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

Few people are even alive today who can remember a time when the Federal Government was not grossly trampling the rights of states. Although such overreaching has been going on to some degree for virtually our entire history it seems that especially since the passage of the 16th and 17th amendments the Federal government has been treating the states as vassals rather than sovereign territories.

Posted in General | Tagged , , , , | 3 Comments