Presidential Sleight of Hand
A journalist tells her boss how hard it is to keep up with Obama
I planned to write more about Obama's search for housing for Guantanamo detainees. But, before I could get my computer booted up, Obama changed his mind and decided, rather than simply releasing them as he had said in his campaigning days, he would instead allow military tribunals for them and see how that goes. Ok, so I switched gears and started to write about that. He said one thing when campaigning; he does another when he gets to the White House.
Then Monday morning, Obama dropped another bomb – he proposed a $190 billion tax increase on American companies. You're aware that Coke has bottling facilities everywhere but on the moon and that may yet happen, if we decide to develop a program of some sort there. Anyhoo, Coke has plants all over the world and they are run by citizens of the countries they are in. For instance, the companies operate as local businesses in local communities across Japan. The workers are Japanese, the managers and owners are Japanese. The profits are, mainly, Japanese.
Obama and his cronies want to tax Coke for the money made in the Japanese market. That's 'taxes' as in 'extra taxes' as in 'we-want-more-of-your-profits taxes.' Coca-Cola already pays taxes in Japan for a product made in Japan, delivered to stores in Japan and sold to the people of Japan. Obama wants Coke to pay US taxes on top of the Japanese taxes, which will make the price of Coke more expensive in Japan and they will sell less.
Also on Monday, Iran threatened to wipe Israel off the map. Well, that's nothing that hasn't happened many times in the last few months but, this time, they went even farther and admitted that their nuclear program is designed for that purpose – to wipe Israel off the map. Israel, concerned over heightened threats from Iran, recently issued a deadline to Palestinians to leave their houses. On Sunday, Ahmadinejad reiterated his call for the end of Israel. As usual, Obama said nothing and the press all but ignored the story.
I looked around the 'tubes on that one for a while and found somebody saying that Obama wants to have Turkey, Syria and Lebanon side with us in dealing with Iran. Several sites emphasized how Israel will work to get around needing America's help in dealing with Iran. It seems that Israel takes Ahmadinejad at his word and fully expects him to deliver on his promise. President Bush backed Israel. I can't find any comment by Obama indicating he feels the same. However, I did see where Rahm Emanuel met secretly with Israeli leaders to reassure them of our continued support. At least, we will support them if the Jews stop dodging Palestinian rockets long enough to go back into peace talks with the Palestinians. If they will do that, Emanuel promised that Obama would do his part to stop Iran's march to achieve their very own nuclear weapons.
Knowing that Iran has been gunning (pardon the pun) for Israel for over 30 years, and knowing that, if the Jews come out of hiding, the Palestinians will just lob more rockets straight at them, maybe it seems logical that Israel would warn the Palestinian people to leave their homes under the possibility of war if something doesn't happen for the better – and soon. Politics is all about 'tit for tat' you do this for me and I'll do this for you. This was no tit nor was it tat. Emanuel threatened the tiny little country of Israel. Now the question is, who does that tiny little country fear more - Iran or Obama?
Why did the press ignore that story? Because, on Sunday evening, Barack and Michelle held hands and walked around the White House. Sorry Boss, but I didn't pick up on that quick enough to get an exclusive for The Observer.
So I kept watching the news and digging around and then I saw that Obama's folks were meeting with some of Chrysler's creditors and figured that was worth following. I thought Chrysler was going to declare bankruptcy and it would all be settled by an experienced bankruptcy judge in a courtroom. It looked to be heading that way until Obama's reps threatened the Chrysler creditors, telling them that he wanted the United Auto Workers Union to be given 55 % ownership of the restructured company. Any of Chrysler's creditors that hold secured loans will have to settle for about 29 cents on every dollar owed them. So, now the Union is set to own Chrysler. Gee, that President of ours sure is a jack of all trades. Who knew he knew so much about the financial workings of an auto manufacturer? He must have studied bankruptcy law when he was in college.
I started looking into Obama's college major but then I got sidetracked by a hot news story that Obama and VP Biden had zipped over to Arlington for burgers and they were yummy. Now I know why those reporters in DC get the big bucks; I sure hope someday I get a chance to report hot news like they do. Maybe Michelle will come to NC and I'll get to post a story about her and her shoes. Did you know she paid $540.00 for them? I think the store threw in the box for free.
Have you heard about this one? USCAP is an environmental group. They are helping democrats draw up the design of the cap and trade program. World Resources Institute is one of the founding members of USCAP. Guess who sits on the board of WRI? AL Gore! And, he's also a partner in Kleiner Perkins, at least since last year, anyway. KP will invest over $600 million in technologies that aim to reduce emissions of carbon dioxide. Sounds like standard business practice 'til you read further and see that, under cap and trade policy, businesses will have to pay for the amount of carbon dioxide that they release during their manufacturing process. AL Gore's money will come from companies that produce products that companies can use to reduce those emissions. Al Gore is part of the group suggesting ways that the cap and trade policy can be structured. He will benefit financially from that policy. What could possibly be wrong with that?
That's when my head started pounding …
So, I took some aspirin and moved on to today's news to see what the President was up to. Remember Tim Geithner, that guy that didn't choose to pay his taxes? The one that, rather than be sent to jail, was chosen to be Secretary of the US Treasury? (I admit, I still haven't figured out what Obama had in mind when he did that but I am certain that all will be revealed at the right time.) Well, Geithner came out and stood beside the President and announced that his office now plans "to end tax loopholes which allow well-off citizens to evade the rules that the rest of America lives by." Yep, he said that, Boss. The rich man who didn't pay his taxes is going after other rich folks who don't pay taxes.
Also, he said that Obama has plans to raise taxes on US companies by $190 billion. And there's when I quit, just gave up. If Obama raises corporate taxes, who does he think will pay them? Big companies don't pay taxes. They just add them to the product they manufacture and pass it on down the line, When Wal-Mart receives that product, they add on a bit for profit and an extra bit to cover the higher cost and then stack it on the shelves. Then Susie Shopper comes along and buys it, paying the accumulated taxes along with the store's profit. Or maybe Susie doesn't buy it 'cause the extra few cents make it too expensive for her budget.
When gas was so high last year, the price of Georgia peaches went up. The price went up because the price for the gas to run the truck to bring the peaches to the grocery store went up. I knew the reason - all of us shoppers knew it. Raising prices at one end of the process simply raises the cost of the product when it gets to the consumer. It doesn't take a math genius to realize that raising taxes on companies will raise the price of the end product and consumers will have to pay that price to get the product. Maybe the President just never shopped for groceries. Maybe the President just doesn't understand how things work after all.
Maybe if the President slowed down and actually paid attention to what he's doing, he might not lead this country off a cliff. And, if he did slow down, I might be able to get that story that I promised written and emailed to you. Things are just going too fast for me to keep up, Boss. I barely get one paragraph written and Mr. Speedy has moved on to a new line of attack. I can't keep up. How does Obama expect us to? Or is that his whole point?
NOT too big to fail
Washington regulators have justified several recent interventions in the financial realm by warning that firms like Bear Stearns and AIG are too big to fail. Allowing these firms to go bankrupt, the argument goes, would result in fire sales and a domino effect, which pose systematic risks to the entire economy. But Jean Helwege, associate professor of finance, writes that there is little to no evidence to support these too-big-to-fail threats of counterparty risk and fire sales.
In "Financial Firm Bankruptcy and Systematic Risk," which Helwege will present April 18 at the FDIC's annual Derivatives Securities and Risk Management Conference in Arlington, Va., she finds that cascading failures are unlikely to occur because of diversification, and that U.S. bankruptcy law allows for plenty of time to avoid fire sales and dispose of assets slowly.
When justifying bailouts or other government actions in the finance sector, regulators warn of a domino effect: One bank's failure triggers another bank's failure, which triggers other failures, and so on. But, Helwege says, this result is, at best, unlikely in reality.
"While the idea of a domino effect of one firm failing and starting a cascade of addition failures seems eminently plausible," she writes, "the empirical evidence to date suggest that no such domino effect would take place were regulators to abandon TBTF policies." Helwege cites prior research that shows that second firms rarely fail because of a first firm's failure and "that there is never a third firm involved, let alone a fourth, fifth, sixth, seventh, eighth, ninth, or 10th."
"Cascades can only arise when firms' loans to other firms are very large as a fraction of their capital, a notion that is both at odds with bank regulations and good business practices regarding diversification," she writes.
Firms are more likely to be exposed to the same risk because they have made similar poor investment choices; such is the case with the current credit crisis and firms' common exposure to the subprime mortgage market. In this scenario, Helwege argues that "regulatory aid to one firm is of little use to the entire economy. Such assistance might bolster confidence, but clearly increasing confidence among all such firms is more productive than merely attempting to boost confidence in one particularly weak firm."
Helwege writes that the best policy oftentimes is to allow a portion of firms to fail without any assistance. Regulators warn that failures like this will result in fire sales, so they often force failing firms into mergers like the Federal Reserve-assisted takeover of Bear Stearns by JPMorgan Chase. However, Helwege points out that bankruptcy law allows plenty of time for less desirable assets to be sold off slowly so that their true worth can be discerned. In fact, mergers like Bear and JPMorgan, which took place over the course of a weekend, actually allow less time for assets to be properly valued. "Mergers like the Bear/JP deal are examples of fire sales, not paths to avoiding them," Helwege writes.
She concludes that the best way to maintain stable, liquid, and orderly markets — the ultimate goal of financial regulators — is to allow individual firms to file for bankruptcy and slowly sell off their distressed assets while allowing Congress to find ways to provide more general assistance to the overall economy.
The Israeli organization Efrat persuades women not to abort their babies -- in part by giving them financial assistance, something that I have long advocated, so it is good to hear that it is now getting increased funding for its lifesaving work
Deputy Minister Ayoub Kara (Likud), a Druze Israeli, declared his intention to do whatever he could to assist the pro-life Efrat organization. He made the commitment following a personal tour of the organization's Jerusalem facilities on Sunday.
"I cannot believe what I see here," Kara enthusiastically said after hearing about Efrat and its activities combating what the organization sees as unnecessary abortions. "There is no other organization of this high caliber in the country. They are literally saving lives here and, in that, assisting the nation in confronting the demographic problem," he added.
"I will assist you in every possible way that I can," Kara told Efrat Chairman Dr. Eli Schussheim. "You will yet hear from me. The whole country needs to know about the great and unbelievable thing that you are doing. I am really moved by what I see here."
Efrat was established in 1977 by Dr. Schussheim, an Argentinian immigrant who served as senior surgeon in Jerusalem's Shaarei Tzedek Hospital during the Six Day War. The organization provides information on abortion that might not otherwise be seen by pregnant women, as well as financial and emotional assistance to expecting mothers who are considering terminating their pregnancies for reasons other than medical necessity.
In his presentation to Deputy Minister Kara, Dr. Shussheim discussed the database of over 4,000 Israeli women currently receiving financial aid from Efrat. The meaning of that figure, Shussheim said, is that the organization is saving the lives of over 4,000 children annually by means of economic assistance alone.
There is a new lot of postings by Chris Brand just up -- on his usual vastly "incorrect" themes of race, genes, IQ etc.
For more postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, SOCIALIZED MEDICINE, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena
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The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)