Saturday, July 09, 2011

The War on Jobs Continues

The war on "big oil" is a war on jobs

The Obama Administration continued its war on American jobs this week by employing more Orwellian rhetoric than a Menshevik at a party congress. I wish they could show as much energy in prosecuting wars in Afghanistan or Libya as they have in the war on American jobs.

"The president believes, we believe, that there are enough members of both parties in both houses who support the idea that a big deal has to be balanced and therefore include spending cuts in the tax code," Carney said according to the Associated Press "employing a phrase White House officials use to describe ending tax loopholes and tax subsidies for certain taxpayers and corporations."

"Spending cuts in the tax code?" That's the Menshevik-in-chief's code for tax increases. Is it any wonder that the newest jobs report was such a stinkbomb? About the only people who don't seem to understand what's going in the economy is the Flat Earth Society at the White House.

It's bad enough that top Obama advisor David Plouffe thinks unemployment isn't important to citizens. It's another thing for the president's economic czar Austan Goolsbee to claim the US is not facing another recession while trying to raise taxes on Main Street, especially in light of the jobs report.

Like all tax increases in this administration, the one they're talking about now is a "targeted" tax increase. They are targeted a you pocketbook and your job.

The presidential candidate who once promised that he'd never, ever raise taxes on anyone making less than $250,000 has become the president who has proposed another set of tax increases that will be felt most acutely by the poor and the middle class.

This tax increase is on oil. And by "oil," I mean you. You'll feel it at the pump eventually and in the unemployment line. The administration contends that they just want to close loopholes. But the Heritage Foundation says that some of those proposals unfairly single out the oil industry.

For example, the oil industry "already faces a higher marginal tax rate at 41 percent compared to 26 percent for the rest of businesses in Standard & Poor's 500," according to Heritage, and that doesn't include the sales taxes that are imposed at the state and local level.

The administration is also trying to repeal some commonplace tax deductions that encourage investment in new capital and jobs here in the US. Amongst these the administration is trying to do away with are the ability of oil companies to subtract capital investment immediately (which all companies should be able to do) and deductions aimed at making manufacturing more competitive in the US.

While the rest of us would love for oil prices to come down, the president and the administration is doing everything they can to keep prices high and discourage domestic energy production. The consequence is that everyone pays more at the pump and those costs are passed along to consumers.

But that's not even half of the cost. Six percent ($533 billion in payroll) of all labor income in the United States and 5.3 percent of all jobs are either directly tied to or support the oil and gas business. Some of the supporting industries include Services, Wholesale and Retail Trade, Finance, Insurance, Real Estate, Rental and Leasing, Manufacturing, Transportation and Warehousing, Information, Construction, Agriculture, Utilities and Mining. The jobs are good paying, technical positions too.

And despite everything the Obama administration has done to slow down domestic development of oil and gas resources, the oil and gas sector is one of the fastest growing jobs markets in a very anemic job market. While other sectors are shedding jobs, oil and gas is hot.

"The six fastest-growing jobs for 2010-11," according to Economic Modeling Specialists Inc's (EMSI) latest quarterly employment data, "are related to oil and gas extraction. This includes service unit operators, derrick operators, rotary drill operators, and roustabouts. Each is expected to grow anywhere from 9% to 11% through this year, in an otherwise mostly stagnant economy." "In total," EMSI concluded, "nine of the top 11 fast-growing jobs in the nation are tied in one way or another to oil and gas extraction."

EMSI says it's not a one-year wonder either. The push for domestic exploration thanks to new technologies on oil and gas recovery is a long-term uptrend: "Over the last five years, the explosion in the sector has been than staggering - even with a minor employment dip from 2009-2010. The industry added more than 345,000 jobs nationally from 2007 to 2009, and is expected add another 85,000 this year, which equals 11% growth."

And the benefits of the oil industry could gather across the economic spectrum to help all of us, if the administration would only get out of our way.

A recent report from Sonecon, an economic advisory firm that analyzes the impact of government policies, studied the investment results from the two largest public pension programs in 17 states. The study covered approximately 60 percent of all the public pension assets in those states. The assets were invested on behalf of teachers, firefighters, police and other public employees.

"During good economic times - or challenging ones - oil and natural gas investments far outperformed other public pension holdings," said Kyle Isakower, API vice president of regulatory and economic policy. Amongst the finding of the report:

* The average rate of return on investments by these funds in oil and natural gas stocks was seven times greater than the average return on their investments in all other assets. This ratio ranged from a low of 2.7 to 1 to a high of 40 to 1.

* On average, the share of these funds' combined returns attributable to their oil and natural gas assets was 3.4 times greater than those assets' share of the funds' total assets.

* While oil and natural gas stocks make up an average of 4.6 percent of holdings in the top public pension funds, they accounted for an average of 15.7 percent of the returns in these funds over the five-year time period, according to the Sonecon study.

These returns are made possible, not because crude oil is a terrible and dangerous polluter, as Obama says, but because petroleum is one of the most versatile, coolest natural resources ever discovered. One barrel of oil creates 19 gallons (more or less) of gasoline. The rest of it goes into over 6,000 other products, including computers, CDs, DVDs, cell phones, pain relievers and vitamins, just to name a few.

While the American job market continues to take casualties, we don't have to look too closely to see where the fire is coming from.



Restoring Fairness with the Lawsuit Abuse Reduction Act

Most people, when they do something wrong, face consequences. Heck, even man's best friend must face the music when he pees on the rug. Sadly, though, this aphorism does not apply to those who file frivolous lawsuits.

Today, there is no swift and sound sanction against a frivolous lawsuit, defined as a claim that has no basis in fact and is not likely to have evidentiary support after a reasonable opportunity for further investigation or discovery. The result over time is potentially hundreds of millions of dollars of unnecessary costs to small business and our nation's economy.

The House Judiciary Committee took a step yesterday toward rectifying this with its approval of the Lawsuit Abuse Reduction Act (LARA). The legislation - H.R. 966 - was marked up and approved by the Committee by a vote of 20-13 and now goes to the full House of Representatives for consideration.

LARA would reduce wasteful litigation by reversing 1993 amendments that weakened Rule 11 of the Federal Rules of Civil Procedure. The post-1993 version of Rule 11 permits attorneys to file a lawsuit first and try to back up their claims later. It allows the plaintiff's lawyer a "safe harbor" of 21 days to withdraw the lawsuit without any penalty, leaving an individual or business no effective recourse.

LARA would make sanctions against those filing frivolous claims mandatory rather than discretionary. It would eliminate the 21-day "safe harbor" that allows unscrupulous lawyers to game the system, and it would replace language in the rule that discourages judges from protecting victims of lawsuit abuse with language that fully authorizes judges to order a party that brings a frivolous claim to pay the defendant's attorney's fees and costs.

With stronger Rule 11 sanctions, there is substantially more risk involved in making a frivolous claim because a claimant cannot just withdraw the frivolous claim without consequence.

Without LARA, an individual or business hit with a lawsuit that has no reasonable basis in law or fact does not have an effective means to recover thousands of dollars in defense costs to have the case dismissed and is forced to pay or settle regardless of the merits. We commend the House Judiciary Committee for taking a first step toward protecting businesses from needless, wasteful costs and restoring accountability and basic fairness.



The Only Reform That Will Restrain Spending

All 47 Senate Republicans now support changing the Constitution to balance the federal budget


Whatever happens when President Obama meets with congressional leaders of both parties at the White House today, no long-term solution is on the table for the spending habits in Washington that have endangered the prosperity of future generations. With our federal debt exceeding $14 trillion-nearly 100% of our gross domestic product-fiscal calamity is jeopardizing our standard of living and undermining our national security. And President Obama recently requested that we add an additional $2.4 trillion to our debt.

There has to be another way, and there is. Republicans in the Senate are united in our concern about our nation's fiscal future. Before we consider saddling our children with even more debt, we must enact significant spending cuts and enforceable caps on future spending. For the long term, to prevent both this Congress and its successors from hijacking the promise of American prosperity, we also need a balanced budget amendment to the Constitution, like the one we and all 47 Senate Republicans have introduced.

The American people who will vote on such an amendment understand the basic financial rules that Washington has been breaking. In the real world, if a household brought in $44,000 annually but spent $74,000 by borrowing $30,000 each year to sustain its spending habits, such behavior would be considered reckless and irresponsible.

Nonetheless, the federal government is doing exactly that on an unimaginable scale, running historic deficits in excess of a trillion dollars for three consecutive years and borrowing 40 cents for every dollar spent. Our government has balanced its budget only five times in half a century.

Why will this approach work where others have failed? For one single reason: As senators and representatives, we take an oath to uphold the Constitution. By amending the Constitution, Congress will be forever bound to match our nation's expenditures with our revenues. Toothless resolutions and statutory speed bumps have proven easy to evade or ignore. Indeed, the reason many lawmakers don't want a balanced budget amendment is the exact reason why we need it: It would permanently end the types of legislative trickery that have now brought our country to the fiscal brink.


I am sorry to say that I think this is mostly showboating but the idea definitely has merit -- JR



The "stimulus" hasn't stimulated: "Hiring slowed to a near-standstill last month, raising doubts that the economy will rebound in the second half of the year. The report baffled economists who had predicted much stronger job creation. And it escalated a debate in Washington over how to spur hiring and energize the economy while also cutting federal spending. Just 18,000 net jobs were created in June, the fewest in nine months. The unemployment rate rose to 9.2 percent, the highest rate of the year, the Labor Department said Friday. Stocks plunged after the report was released, although the market recovered some losses in late-afternoon trading. The Dow Jones industrial average closed down 62 points for the day. Broader indexes also fell."

That charming TSA again: "A luggage screener has allegedly been caught stealing from passengers. Nelson Santiago, from the US Transportation Security Administration (TSA), has been arrested for allegedly stealing around $50,000 worth of electronics this year, MSNBC reports. Police claim that Santiago stole computers, cameras and other electronics from luggage he was screening. He would use his phone to upload a picture of the stolen item online and sell it by the end of his shift. A Continental Airlines employee even reported seeing Santiago stuff an iPad down his pants. Santiago is no longer working for the TSA. Police say that there could be many more victims.

One small step for man, one giant leap for private markets: "This Friday will mark the last ever space shuttle mission in NASA's program. The program has lasted nearly half a century and seen the launch of over 135 missions (including this last one by the Atlantis). For those who can remember being glued to the television as the Discovery, Endeavour, challenger and Columbia blasted out the Kennedy Space Center, this may be a bittersweet moment. However, the tearful can take comfort in the thought that they are waving goodbye to another landmark: the government's fifty-year monopoly in the space industry."

Designate Public Intoxication law for repeal: "Let's say you - or someone you care about - had a few drinks one night and, knowing it would not be a good idea to drive, decided to let a sober person take the wheel. Did you realize you can still be charged with a criminal offense? It's true. The Indiana Supreme Court just affirmed this in Moore v. State.... Indiana's public intoxication law is horrendously vague and depends upon the arbitrary discretion of law enforcement, which means it is open to possible abuse."

Iranian weapons killing Americans in Iraq: "Fresh warnings came from the Pentagon on Thursday that Iran is supporting extremist militias in Iraq that are killing U.S. troops. Weapons such as IRAMs -- improvised rocket-assisted munitions -- and specially shaped explosives called EFPs -- enhanced explosive penetrators -- have taken a deadly toll on U.S. forces in Iraq, Mullen said, and investigations have tied the weapons directly to Iran. "They are shipping high-tech weapons in there -- RAMS, EFPs -- which are killing our people and the forensics prove that," Mullen said. "From my perspective, that has to be dealt with, not just now because it is killing our people, but obviously in the future as well."


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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)


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