Sunday, August 23, 2009
It is looking as if Google is going to bar me permanently from updating two of my blogspot sites so I may have to shift them to Wordpress. My Immigration Watch blog is on Wordpress so I know my way around there. Meanwhile the following mirror site links will enable you to read the latest posts on the two blogs concerned.
Political Correctness Watch
Eye on Britain
Corporate Shills for Hope and Change
by Michelle Malkin
Money from pharmaceutical firms and health care companies is dirty, evil and corrupting -- except when key members of Team Obama are pocketing it. White House spokesman Robert Gibbs derides grassroots opponents of socialized health care as industry-funded lackeys with questionable motives and conflicts of interest. But what about the corporate shills at 1600 Pennsylvania Avenue?
Two weeks ago, the White House embraced $150 million in drug industry ads supporting Obamacare. This week, Bloomberg News reported that White House senior adviser and chief campaign strategist David Axelrod's former public relations firm, AKPD Message and Media, has raked in some $24 million in ad contracts supporting Obamacare -- along with another PR firm, GMMB, run by other Obama strategists.
The ads are funded by Big Pharma, the AARP, AMA and the powerhouse Service Employees International Union (whose Purple Shirts dumped $80 million in independent expenditures to get Obama and the Democratic majority elected). In trademark Axelrod style, the special interest coalition adopted faux grassroots names -- first under the banner of "Healthy Economy Now" and more recently as "Americans for Stable Quality Care."
Because, well, "Corporate Shills for Hope and Change" doesn't have quite the same ring of authenticity.
Axelrod was president and sole shareholder of AKPD from 1985 until last December, when he resigned to take his White House position. His son, Michael, works there. So does former Obama campaign manager David Plouffe.
The myth of America's manufacturing decline
During the past few years, America has grown increasingly averse to trade. This trend is the product of myths perpetuated by campaigning politicians, captured policymakers, TV charlatans, and woefully ill-informed newspaper columnists. Harold Meyerson always comes to mind as emblematic of this last category, so his fallacy-laden diatribe about the decline of U.S. manufacturing in Wednesday’s Washington Post is par for the course.
Meyerson makes a few claims that cannot be allowed to stand. For example, he asserts: “We don’t [make things] any more — at least, not like we used to. Since 1987, manufacturing as a share of our gross domestic product has declined 30 percent.”
First of all, note that Meyerson’s second sentence does nothing to support his first. A decline in the manufacturing sector’s share of the total economy can result from growth in other sectors, rather than from a decline in total manufacturing output, and that’s what’s happening in the U.S.
According to data from the 2009 Economic Report of the President, as gathered and reported recently by George Mason University economics professor Don Boudreaux, since 1987, real U.S. manufacturing output has increased by 81 percent. And as reported by the Bureau of Economic Analysis, American real manufacturing value-added — the market value of manufactured goods, over and above the costs that went into their production — reached a record-high level in 2007 (the last year for which final data are available), breaking the record set in 2006, which broke the record set in 2005, which broke the record set in 2004. Notwithstanding the recent recession that has affected all sectors of the economy, U.S. manufacturing has been thriving in recent years.
If Meyerson isn’t intentionally misleading Washington Post readers, he is simply unqualified to be rendering conclusions about the state of manufacturing. A basic look at the history of the statistic he used shows its uselessness to the point he wants to make. Manufacturing as a share of gross domestic product peaked in 1953 at about 28 percent of the economy — well before the period of U.S. industrial prowess Meyerson yearns for — and has been trending downward ever since. Today manufacturing accounts for about 12 percent of our services-dominated economy, but manufacturing output and value-added are higher than ever in real terms.
Second, if the United States doesn’t “make things anymore,” nobody does. According to data from the United Nations Industrial Development Organization, U.S. factories are the world’s most productive, accounting for 25 percent of global manufacturing value-added. By comparison, Chinese factories account for 10.6 percent.
That may be hard to fathom, given that U.S. factories tend not to produce the sporting goods, toys, tools, and clothing found in Wal-Mart and other retail outlets nowadays. But U.S. factories make pharmaceuticals, chemicals, technical textiles, sophisticated components, airplane parts, and other products. American factories have moved up the value chain.
Contrary to this last point, Meyerson asserts, “The long-term decline of American manufacturing has depleted our high-tech, cutting-edge industries as much as it has our more venerable sectors.” To support his claim, he cites the value of our “high-tech” exports falling behind China’s beginning in 2004. By “high-tech,” Meyerson means computers, iPods, and other consumer electronic gadgets so ubiquitous nowadays. But in reality, the percentage of Chinese value-added in these so-called high-tech exports is quite small. Economists at the U.S. International Trade Commission estimate that only about 50 percent of the value of U.S. imports from China is actually Chinese value-added; the rest is value added in other countries and embedded in the components, design, engineering, and labor.
For iPods, the Chinese value-added is a few dollars on a product that costs $150 to produce and retails for $299. So, as China’s “high-tech” exports leave America’s “in the dust,” their sale in the United States and elsewhere supports high-paying American engineering, marketing, and logistics jobs, while providing Apple with the profits to conduct R&D to employ more engineers and keep the virtuous circle going.
The factory floor has broken through its surrounding walls and now traverses borders and oceans. What we have now is a world in which it is no longer “Us versus Them,” but rather “Us and Them,” a formulation that has been helping U.S. manufacturing to thrive. Without complementary Chinese and other foreign labor, far fewer American manufacturing ideas would come to fruition.
American manufacturing is by no means in decline. What should be is Meyerson’s myopic way of seeing things.
Fannie Mae and Freddie Mac are threatening to derail housing recovery
They are making it virtually impossible to buy and sell many properties
According to the Community Associations Institute, nearly 60,000,000 people live in shared ownership communities in the United States -- condominiums, co-ops and planned developments governed by a homeowner's association (HOA). When these "new neighborhoods" are first built, there are often various common construction defects.
In an ideal world, every developer would stand by their product, either repairing the defects or giving homeowners enough money to fix the defects themselves. But when this doesn't happen, community associations are forced to file lawsuits against developers to convince them to repair construction flaws.
It is the legal duty of a board of directors to protect owners' interests in the property, and if negotiations with a developer fail, a lawsuit may be the only available option. Nearly 100 percent of new developments have warranty issues with their developer, and almost a quarter of those are forced to file litigation.
In January of 2008, after the housing crash decimated the market for thousands of recently-constructed homes, Freddie Mac quietly added the following regulation to its lending guidelines: A project is ineligible for financing if "the homeowners' association is a party to current litigation, arbitration, mediation or other dispute resolution process and the reason for the dispute involves the safety, structural soundness or habitability of the project."
Of course, this language is broad. It encompasses almost every lawsuit ever filed against a developer, for almost any construction defect.
Fannie Mae, in an even broader exclusion, declares as ineligible "any project for which the homeowners' association or co-op corporation is named as a party to current litigation." This is a gross restriction of the basic right of any corporation to protect its interests through the legal system. And, because many banks use the Fannie Mae/Freddie Mac guidelines as the basis for their own lending policies, loans in newly constructed neighborhoods have become extremely difficult to secure.
If a developer refuses to repair a roof, the board of the association chooses to sue the developer, hoping to recover enough money to make repairs. But under the new guidelines, that lawsuit means that very few banks will lend money to new buyers in the building, bringing unit sales to a halt.
Property values in the condominium crash (if you can't sell your home, it's not worth anything). Owners are then left with a property worth a fraction of its actual value, and have only two options--drop the lawsuit and accept that the developer has sold them damaged goods (and try to collect enough money from assessments to make the repairs), or continue the lawsuit while their development stagnates and shrivels.
The long-term health of shared ownership communities, and by extension all American neighborhoods, depends on a robust market for home sales. Current lending guidelines are stagnating that market.
It is critical that federal legislators press Fannie Mae and Freddie Mac to revise their guidelines to allow community association boards, tasked with the legal obligation to protect owners' interests, to file legitimate lawsuits against developers for construction defects without restricting the ability of banks to lend money to new owners. Otherwise our housing recovery, reliant on clearing overstock from these new developments, will falter.
Zogby Interactive Poll: Obama's Job Approval Sinks to Record Low 45%
President Barack Obama's job approval rating has sunk to a record low of just 45%, the latest Zogby Interactive poll shows. Fifty-one percent of likely voters now say they disapprove of the President's job performance.
"None of these numbers looks counter-intuitive to me. Gallup, NBC, and Pew all have Obama at record lows. Rasmussen also shows low approval. Things are volatile out there and news travels fast. There is a lot of anxiety over healthcare," said Zogby International President and CEO John Zogby. "The President let it get away from him and voters are scared right now. They are experiencing sacrifice overload and feel more threatened than empowered. The President is being forced to play defense and he is much better when he is in possession of the ball. But do not underestimate Obama. Last August he was toast."
While this latest poll shows Democrats continue to overwhelmingly approve of Obama's job performance (84%), just 6% of Republicans say the same. Most independents (59%) now disapprove of the job the President is doing.
"He has lost support among political independents, that's the biggest change from our last survey. He is also starting to lose support he had picked up among investors and frequent Wal-Mart shoppers -- who both are on the conservative side but where Obama had been making gains," Zogby said. "Remember, Zogby polling has generally been ahead of the curve during the past three administrations."
The US economy ain't looking too bright : The Keynesian key to unlocking demand is to inflate it by expanding the money supply. And this is where the banks come in. If we were living in normal economic circumstances the banks would be holding about $60 billion in reserves. They are in fact holding about $800 billion and Bernanke and Obama want them to unleash them. If this pair succeed in opening the floodgates Americans will be facing surging inflation
How can the Fed prevent asset bubbles?: All that aggressive Fed policies have actually achieved is weakening of the process of real wealth formation. This, in turn, has only weakened the economy's ability to grow. The only reason why the US economy didn't fall into a depression is because the pool of real savings is still holding its ground. The best way to prevent the emergence of asset bubbles is to stop the Fed from pushing massive amounts of money to the economy
Australia: The economic outlook is not as bright as the Reserve predicts : Despite the Reserves and the Treasury's Pollyanna predictions there are still dark clouds hanging over the future of the economy. IMF predictions for the capital stock suggest a fall in real wages is a distinct possibility
God would not endorse Obamacare: Dr. Ezekiel Emanuel is one of the masterminds behind Obama's health care proposals. According to Emanuel those who are unable to become 'participating citizens' should be denied medical care until they die. Apart from the definition of 'participating' - which could be easily expanded to fit just about any circumstances - what is clearly missing from Emanuel's proposal is any sense of humanity or common decency. People are to be disposed of because they cannot 'participate'. What about the fact that they are still human beings. Ezekiel Emanuel should change his name to Josef Mengele
Australia: The Government's insane alternative energy scheme: The government's scheme to impose so-called alternative energy sources on the country would devastate the economy and slash living standards. The idea that "tax swaps" could offset the massive costs to this destructive scheme is a fantasy
Media bigotry: dishonest reporting and the US economy: The only thing Obamanomics has stimulated is the Obama cheerleaders still left in the media who haven't joined his administration Democrats' new slogan:
Protest for Me, But Not for Thee : The Democrats envisioned the middle-class welcoming, with spread-wide-open arms of gratitude, these new power plays that would put more control into the hands of their beneficent bureaucracy. Instead, the Alinskyites are being met with 1776 Redux, and all they can do is yell "Fascist" at the top of their lungs, just as they've been doing for 40 years. But who are the real fascists?
Obama has saved America!: President Obama claims that he valiantly brought America back from the brink of the economic chaos that was caused by his predecessor. But as is often the case with Obama, the devil is in the details
Obama's big brother-care looms large: Obama's proposal to nationalise American health cars consists of nearly 1,100 pages of wonderfully ambiguous little nuggets that grant politicians and bureaucrats unlimited loopholes to do whatever it pleases them with the lives and well-being of Americans
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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)
Posted by JR at 12:49 AM