For the day when the Greenback goes "Pop"!

In an interview below, Doug Casey has some hints for when all those greenbacks Obama has printed begin to make their presence felt  -- with a drastic loss in buying power for all greenbacks, including your savings.  

L: Doug, we talked previously about getting assets out of your home country, especially the US, where to take them, and what to do with them. In so doing, you touched on the inevitability of currency controls just ahead, especially for Americans. Can you tell us more about that?

Doug: Yes. I'm quite serious about what I said about "the grim reality of impending currency controls." As the global economy continues to deteriorate, governments will have to appear to be "doing something." It's going to become very fashionable to institute some sort of foreign exchange control.

Why might that be? Because obviously, people who are taking their money out of the country are unpatriotic…

L: Those bastards.

Doug: That's right. Jingoistic Americans naturally, but stupidly, see taking money out of the country as being unpatriotic. They don't understand that it's mainly those prudent people who will be able to supply the capital to rebuild a devastated economy later. Besides, getting money abroad is obviously something that only rich people would do… and of course, it's time to eat the rich, as well. For those two reasons, there won't be much resistance to controls. And the state gets to appear to be "doing something."

And when they do, more people – at least those with any sense – will get scared and really try to get their money out, which will exacerbate the run to the exits. The bottom line is that if you want to get your money out, the time to do it is now. Beat the last-minute rush.

I don't know what form the exchange controls are going to take, but there are two general possibilities: regulation and taxation.

The regulations might take the form of a rule prohibiting you from taking more than X thousands of dollars abroad per year without special permission. No expensive vacations, no foreign asset purchases without state approval.

As for the taxation, if you want to, say, buy foreign stocks or real estate, you might have to pay an "Interest Equalization Tax" or some such. So you could do it, but it'd cost you a lot of money to do it.

Something like either of these, or both, is definitely in the cards.

L: But aren't FX controls something from the past? I mean, where do they exist today?

Doug: Well, FX controls have been used since the days of the Roman Empire. A country debases its currency, raises taxes beyond a certain level, and makes regulations too onerous – and productive people naturally react by getting their capital, and then themselves, out of Dodge. But the government can't have that, so it puts on FX controls. They're almost inevitable at this point.

Almost every country – except for the US, Canada, Switzerland, and a few others – had them until at least the '70s. I remember leaving Britain once in the '60s, and a border guy searched me to see if I had more than 50 pounds on me. In those days, currency violations in the Soviet bloc countries could get you the death penalty. Things liberalized around the world with Reagan and Thatcher, and then the collapse of the USSR. But you have to remember that that was in the context of the Long Boom. Now, during the Greater Depression, things will become much stricter again.

Right now, the US just has reporting requirements. But some places, like South Africa, make it very expensive and inconvenient to get money out. South Africa, perversely, may serve as a model for the US.

L: Okay, so we talked previously about Americans at least setting up a Canadian bank account and safe deposit box, and better yet going in person to Panama, Uruguay, Malaysia, or a similar place to do the same. And once there, you advised getting with a lawyer, either referred by someone you trust or found through an interview process, to set up a corporation that can handle your assets and investments for you. This all needs to be reported, but it's wise to do it in advance of the higher costs or other limitations to come.

Doug: Yes. While US persons must report foreign bank and brokerage accounts, safe deposit boxes are not – at least not yet – reportable. This leads me to the biggest and best "loophole" when it comes to potential foreign exchange controls, and that's foreign real estate.

I'm of the opinion that, broadly speaking, real estate as an asset class is going to be a poor performer for a long time to come – but that won't be equally true across all countries. Real estate in countries that rely on mortgage debt to buy and sell will continue to be the worst hit.

People don't understand that buying property with a mortgage is just the same as buying stocks on margin. It's caused speculative bubbles and malinvestment. Until the malinvestment in those countries is entirely liquidated, you don't want to invest in real estate in them. But a lot of countries, especially in the Third World, have no mortgage debt whatsoever. Zero mortgage debt. You want a piece of property, you pay for it in cash. That keeps prices down and the market much more stable. And it makes for more interesting speculations, because if a mortgage market develops in the future, it could light a fire under prices.

But, from the viewpoint of FX controls, the nice thing about real estate is that there is no way they can make you repatriate it. Other than owning a business abroad, real estate is the only sure way to legally keep your capital offshore.

L: I suppose it would be difficult for even Uncle Sam to seize your estancia in Argentina… not without starting a war.

Doug: Yes. Although I don't doubt he'll be starting more wars as well… [Laughs]

L: So, part of your thinking here isn't just speculative. You're talking about strategies for wealth preservation, not just in the face of foreign exchange controls, but more aggressive, predatory taxation and confiscation by the state – they can seize your assets, even real estate, in the US, but not abroad.

Doug: Exactly. Argentina is excellent from that point of view; rights to real property are, if anything, better than those in the US. In many ways, Argentina is culturally and demographically more like Europe than Europe. Uruguay is also excellent, although culturally it's like a backward province of Argentina. Paraguay is quite secure – but a bit weird as a place to live.

 More HERE

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“Food for Peace” Hurts Foreign Farmers

The United States government is the world’s largest food donor but its aid consistently wreaks havoc abroad. The Obama administration is pushing reforms that could slightly reduce the number of Third World farmers bushwhacked by American food dumped into their marketplaces. But there is scant enthusiasm in Washington for any fix of a program that is beloved by many special interests.

The U.S. launched the Food for Peace program in 1954 during the Eisenhower administration, largely to dispose of embarrassing crop surpluses that had been encouraged by federal farm programs. To carry out Food for Peace, the U.S. Department of Agriculture buys crops grown by American farmers, has the food processed or bagged by U.S. companies, and then pays to send them overseas in U.S.-flagged ships. The annual cost to taxpayers? Last year, it was roughly $1.5 billion.

At least 25% of all U.S. food aid must be shipped from Great Lakes ports, per congressional mandate. This provides a steady stream of (taxpayer) revenue for American port towns and merchant seamen. Once the goods arrive at their destination, the U.S. Agency for International Development often takes charge or bestows the food on private relief organizations.

Because Food for Peace is structured to focus primarily on U.S. interests, it has long been notorious for putting some of the world’s poorest farmers out of business. Sen. Harry Bellmon (R., Okla.) crafted a legislative amendment in 1977 that required USAID and the Department of Agriculture to certify that food aid would not devastate farmers or destabilize markets in recipient countries. But whom does Uncle Sam entrust to assure that donations won’t pummel local farmers? In most cases, a foreign government or private-relief organization hoping to gain a tremendous free-food windfall from Washington.

To USAID’s credit, in 2008 it began tapping an independent consulting firm, Fintrac Inc., to recommend prudent donation levels. Nevertheless, in 2010 USAID approved sending almost three times as much rice to Liberia as Fintrac recommended. That same year the agency approved massive wheat shipments for Burundi and Sierra Leone, even though Fintrac recommended against it.

The Department of Agriculture is even more reckless. In 2008, it approved sending 30 times more soybean meal to Armenia than the agency’s own staff experts recommended.

Since 1985, USAID has permitted recipients to “monetize” U.S. food aid—selling all or part of it in local markets and using the proceeds to bankroll their preferred projects. U.S.-donated food is routinely sold in local markets for much less than prevailing prices. In 2002-03, a deluge of food aid in Malawi caused local corn prices to plunge by 60%. Mozambique wheat prices nose-dived in 2002 after USAID and the Department of Agriculture simultaneously “flooded the market,” according to the U.S. Government Accountability Office. Haitian farmers were similarly whipsawed after the U.S. and other nations bombarded the island with free food after the 2010 earthquake there.

In a speech this month at the Washington-based Center for Strategic and International Studies, Rajiv Shah, head of USAID since Dec. 31, 2009, called the monetization of food aid “inefficient and sometimes counterproductive,” saying that in some cases “evidence has indicated that this practice actually hurts the communities we seek to help.” Meanwhile, the United Nations Food and Agriculture Organization cautions that monetization often results in “destroying local farm prices” and CARE, one of the world’s largest relief organizations, boycotts all monetization projects.

The Obama administration is proposing to end monetization and instead give more cash to foreign governments and private-relief organizations to buy and distribute food locally and finance preferred projects. The administration also advocates trimming the percentage of the Food for Peace program’s budget spent purchasing and transporting U.S. food to 55% from the current 75%.

Not surprisingly, the administration’s proposals are facing staunch opposition from the farm lobby, relief organizations addicted to manna from USAID, and the merchant-marine lobby.

Yet Mr. Shah says USAID estimates that the proposed reforms would allow U.S. aid to feed up to four million more people per year. The agency is also touting a new program to distribute debit cards to allow refugees and others to shop for meals at local stores—similar to how the food-stamp program operates domestically.

The resistance that the Obama administration’s modest reforms are facing epitomizes how Congress and special interests don’t care how much harm food aid does abroad. Unfortunately, gross negligence has long been Food for Peace’s trademark.

 More HERE

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America's two economies

by L. Neil Smith

There are two Americas.  People who live in other countries and don't know this, need to understand it. People who live in this country are even less likely to be aware of the difference, although, if there is to be a tolerable future—or any future at all—they're going to have to deal with it.  And soon.

One of the two Americas everybody has to live with today is a politico-corporate structure, and a kind of wildly metastasizing societal cancer, the United States government and the mercantilist—not capitalist—companies whose operators have come to believe, quite mistakenly, that they own everything and everybody within their gaze.

If you are reading these words, likely you're part of a different America. If you aren't, there are things here you need desperately to know.

This other America we live with has fed, housed, and clothed more human beings, achieved greater progress, generated more prosperity, than any similar entity in history. It, not the government nor any of its parasitic corporate attendants, is that bright, shining beacon in the West that has inspired people to come here, or to remake their own countries, for two centuries. In many ways, the poorest person today lives a healthier, longer life than the Pharaohs in their day, because of this second America, consisting of the individuals of this nation and the civilization they built, one painful, expensive brick at a time.

We call the driving energy of this America capitalism.

There is a difference—a big difference—between mercantilism and capitalism. Under the latter, individuals put away some portion of their income instead of spending it immediately, invest whatever they may have accumulated that way in some private undertaking, and strive to improve their fortunes—and compete with others—by offering customers the best possible goods and services at the lowest possible prices.

Invariably, as a part of this constant striving between private enterprises, prices steadily fall, while the quality of goods and services—many of them entirely new inventions—constantly rises. This is the process by which America grew to be the most prosperous and progressive nation in human history and on the face of the planet. The fact that peace and freedom didn't always follow is not due to capitalism.

Mercantilism, rather than being born of individual effort and aspirations, is the bastard offspring of business and the State. It is the system against which Adam Smith railed in his 1776 bestseller Wealth of Nations, when commercial lash-ups like the British East India Company were granted a monopoly in some foreign territory by the King, and had their own armies and navies to enforce it. Our Founding Fathers were fighting mercantilism as much as they were the British crown. The tea that they dumped in Boston Harbor may have been taxed by the King, but it was imposed on the colonists by some royally approved monopolist.

Today, it may be as simple as a company bribing a congressman in order to obtain a government contract. It may even be less direct than that, with the company promising to build the new factory that the contract will necessitate within the congressman's district, creating jobs the congressman can then brag about the next time he runs for re-election.

As the company and the congressman become mutually dependent on each other—symbiotic—they grow wealthier and more powerful, joining what Ayn Rand called "the Aristocracy of Pull". Note that this relationship has nothing to do with satisfying purchasers, the price or quality of whatever goods are involved, nor does it matter whether the product is actually wanted. Money—stolen at implicit gunpoint from unwilling "customers"—and raw political power are all that count.

In fact, should anybody happen to come along, offering a better or cheaper product, instead of rising to the occasion and competing with the innovator—a process by which technical and social progress are achieved—the entrenched mercantilist company will "encourage" its symbiotic congressman to pass a new law or promulgate some regulation that will cripple its competition, preserving the status quo. Progress and potential are lost in the process, but nobody cares.

 More HERE

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For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC,  AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

List of backup or "mirror" sites here or  here -- for when blogspot is "down" or failing to  update.  Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)

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Dangerous Leftist hatemongers

The Southern Poverty Law Center (SPLC) has a problem.  They are now directly tied to a terrorist act committed by a nut who attacked the Family Research Council because the SPLC listed that group as a “hate group” due to their traditional views on marriage and family.

The SPLC makes a living as one of the left’s favorite hate finger pointers, and now due to their over the top rhetoric, they are certified in federal court as being directly responsible for an act of domestic terrorism.

Floyd Lee Corkins, II pled guilty to charges of domestic terrorism explaining that he came to target the Family Research Council saying, “Southern Poverty Law lists anti-gay groups.”

The Washington Examiner’s Paul Bedard reported that Corkins admitted in court that he hoped to “kill as many as possible and smear Chick-Fil-A sandwiches in victims’ faces and kill the guard.”

Now that Southern Poverty Law Center has been fingered by an admitted and convicted domestic terrorist as being the source for his targeted rage, it is time for the federal government to disassociate from this group that incites hate.  Incredibly, in spite of the direct tie to this terrorist act, the SPLC has not removed either Family Research Council or another of Corkin’s targets, the Traditional Values Coalition, from their “Hate Map.”

Now that the federal court has tied SPLC to a direct domestic terrorist act, it is fair to ask just what is the Southern Poverty Law Center?

This innocuous group Montgomery Alabama based group’s website describes itself as, “a nonprofit civil rights organization dedicated to fighting hate and bigotry, and to seeking justice for the most vulnerable members of society.”

Over the years, the SPLC has managed to insinuate itself into various federal and state law enforcement agencies including the Bureau of Alcohol, Tobacco and Firearms, the Department of Homeland Security and the Justice Department (read emails obtained by Judicial Watch between SPLC head Morris Dees and DOJ.)

The relationship with Obama’s DHS is so deep that in 2009, the Department set up “Fusion Centers” in each state that include the Southern Poverty Law Center ostensibly to coordinate federal, state and local responses to Katrina-like disasters.  The reality is that the fusion centers have on at least two occasions issued reports and statements that specifically attack conservative oriented groups, either tying them to acts of domestic terrorism or identifying them as terrorist threats.

And the SPLC’s influence continues to expand.  In a case of one of the most poorly timed letters in U.S. history,  the Southern Poverty Law Center wrote to the Departments of Homeland Security and Justice on March 13, 2013, urging them to shift priorities toward “the growing threat of non-Islamic domestic terrorism.”

Tragically, just a little more than a month later, foreign born Islamic jihadists bombed the Boston Marathon, showing that the SPLC couldn’t have been more wrong.

The SPLC has proven itself to be nothing more or less than an organization that finds domestic conservative terrorists around every corner, and according to liberal critics are little more than direct mail fundraising scam artists.

And now, that they have been directly implicated as the responsible party for motivating a proven act of domestic terrorism, their influence on government policy needs to be ripped out by the roots.

Congress should treat SPLC like they did ACORN when they were proved to be running an operation designed to undermine the U.S. election process by engaging in massive voter fraud.  All ties with law enforcement should be discontinued immediately, and the SPLC should be eliminated from every working group trying to set anti-terrorist policy.  To leave them in the room is akin to looking the fox in the henhouse in the eye, winking and closing the door.

If Congress fails to act, a group that has been proven to incite terrorism will continue to have access to the highest levels of the Obama Administration with all the respect that those associations convey.

Never again, should a group found responsible in a court of law for driving a terrorist act be seated at the highest levels of power defining what should be considered a terrorist act.  Fortunately, in the case of the Family Research Council, multiple deaths were avoided due to the courage of an unarmed guard.

And yet through it all, the Southern Poverty Law Center continues to spew hate, all in the name of toleration.

SOURCE

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Banking secrecy is a key civil liberty

By Martin Hutchinson

The wolves are closing in on the world's bank secrecy laws. Former bank employees in Switzerland and Liechtenstein have handed lists of depositors to the U.S. and EU authorities. Following the Cyprus debacle, the EU is seeking to end bank secrecy in the well-run banking systems of its members Luxembourg and Austria. Luxembourg appears to have "compromised" but Austria, bless it, is still holding out (as a former.Abteilungsdirektor of the Austrian bank Creditanstalt-Bankverein I declare an interest here.) Nevertheless I hope a number of strong-minded but respectable states with few avenues for blackmail keep bank secrecy, for one very good reason: in a modern social-democratic world, it is a key civil liberty.

The first bank secrecy law was written by Switzerland in 1934 and played a vital role in enabling at least some German Jewish people to preserve both their lives and their assets during the horrors of World War II. The "key civil liberty" aspect of bank secrecy laws thus cannot be dismissed. While we will hopefully never again have a regime as evil as the Nazis, there are plenty of regimes around the world that oppress their subjects, and those subjects need an asset bolt-hole where they can preserve their wealth while they emigrate or simply decide to wait for better times.

Switzerland had a tradition of neutrality and a solid banking system which, unlike Austria's and Germany's had not been affected by World War I; hence it naturally became a haven for flight capital. Given the political situation in Germany, Italy (another dictatorship) Spain (Socialist government followed by civil war) and France (Communist-Socialist Popular Front government from 1936) it's also not surprising that a Swiss banking secrecy law was thought necessary, to prevent bank employees selling customer information to brutal governments.

After World War II, even Britain had exchange controls until 1979, while its governments, Conservative and Labour, pursued highly repressive policies, with top rates of tax above 90% for almost the entire period, interest rates around or below the rate of inflation, and inflation itself eroding the real value of savings. It's thus not surprising that even in that law-abiding society, many people found ways to get their money out of Britain's closed economy and into the safe hands of a Swiss or Channel Islands bank (this is neither a confession nor a claim of virtue – the Hutchinsons were simply not rich enough to benefit much from doing this.)

The remainder of Western Europe similarly suffered from very high marginal rates of tax after World War II, as did the United States (albeit only at very high levels of income.) It's thus not surprising that many perfectly respectable wealthy citizens saw Switzerland, Luxembourg, or in the U.S. case the tax havens of the Caribbean as sensible places to park their money. The Eurobond market, in which investments took the form of untraceable bearer bonds denominated in hard currencies, grew up from 1963, with Luxembourg a favorite place to deposit the bonds concerned.

Government responses were fairly slow in arriving; the U.S. Bank Secrecy Act was passed only in 1970, and even in the 1970s morning trains from Brussels to Luxembourg were full of comfortable burghers (proverbially "Belgian dentists") with bearer bonds tightly wrapped around their upper bodies, going to clip coupons. Then some governments reacted the opposite way; Austria passed bank secrecy legislation only in 1978, in an attempt to get some of Switzerland's business. It was said to be tighter than Swiss legislation, because you never needed to give your real name, merely show the nationality of your passport. If you said your name was Mickey Mouse the bank staff would accept this, and when you visited the bank cheerfully greet you with "Gruss Gott, Doktor Maus!"

Of course, this system has been abused. Ethically, in tax systems that are not oppressive, people should pay the taxes they owe. However when governments levy taxes at rates of 70, 80 or 90%, the ethics become arguable, and you can certainly see the benefits of bank secrecy to people whose home is in a dictatorship, or even a nominal democracy whose economic policy is appallingly bad (most comfortably off Argentines, for example, have foreign bank accounts.) But at the other extreme bank secrecy is only too useful to terrorist and organized crime groups.

In the middle are the dictators themselves, who may be evil billionaires like the Congo's Mobutu Sese Seko, embezzling all the wealth of their country, but may also be largely honest and economically benign authoritarians, like Chile's Agosto Pinochet or Croatia's Franjo Tudjman, who know they can't rule forever and want to keep their modest and mostly legitimate wealth out of the hands of their leftist successors. Also somewhere in the middle are the Russian mafia, who can't reasonably claim a need to escape President Putin's tax regime, a flat tax of only 13%, but can reasonably wish to keep some wealth out of the hands of Vladimir Vladimirovich's unpleasant cronies. Of course, it was foolish of them to choose Cyprus as their haven, rather than somewhere economically solider and politically less bullyable.

Governments and the media will tell you that tax havens and bank secrecy regimes should be closed down, but economically and ethically it isn't as simple as that. Even democracies can run into crises, or elect leftists like France's Francois Hollande, whose tax regime of a 70% income tax plus a 1.6% wealth tax meets any reasonable definition of confiscation. Even in the United States, that supposed haven of wealth and capitalism, polls consistently show at least 60% support for further tax rises on the wealthy, even after the December 2012 deal eliminated the 2001 tax cuts for incomes above $450,000. You can perhaps argue that a little more U.S. tax on the wealthy would not be harmful, even when you add together the three layers of Federal, state and local taxes, but when President Obama, within two months of obtaining a substantial tax increase on the rich, demands another one, and public opinion generally favors that demand, we can see that in some political circumstances even Americans are not safe from expropriation.

More HERE

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Dumped! by Google

One recent Thursday morning, I logged into my email and made an alarming discovery. Instead of opening my inbox, Google directed me to a notice:

"Account has been disabled . . . . In most cases, accounts are disabled if we believe you have violated either the Google Terms of Service, product-specific Terms of Service . . . . or product-specific policies . . . . it might be possible to regain access to your account."

It was like I’d gotten dumped, via text message, by someone en route to Cabo.  The vagaries left me reeling. I read the terms and policies, but they offered few clues. There were no numbers to call, no tickets to request help. I had a real problem with how things ended, so I filled out a form and sent it into the ether. What exactly had I done wrong? Had I missed the warning signs? Did Google want me or not?

At last count, Google manages a whopping 343 million active Google+ accounts (though the number of actual people using its services is probably fewer) and operates in 130 languages. Google strategically avoids the crush of users by offering little in the way of direct customer service. My calls to Mountain View HQ landed me in a labyrinth of recorded messages that inevitably led to one of a man, sounding only slightly less exasperated than I felt, shutting me down with a “Thankyougoodbye.”

A few minutes into my Google-less existence, I realized how dependent I had become. I couldn’t finish my work or my taxes, because my notes and expenses were stored in Google Drive, and I didn’t know what else I should work on because my Google calendar had disappeared. I couldn’t publicly gripe about what I was going through, because my Blogger no longer existed. My Picasa albums were gone. I’d lost my contacts and calling plan through Google Voice; otherwise I would have called friends to cry.

I turned to Facebook to ask friends who work at Google for help. Living in the Bay Area, I have a fair number of Googler-friends, but the Googleplex has apparently grown so vast that none of them had any idea where to start. One guessed the policy department, another accounts. All assured me that this sort of thing rarely happened.

I had assumed it never happened at all. Sure, it had occurred to me when I had moved my work and memories into the “cloud” that I was relying on other people to keep them safe on their servers. But I figured a company with $50 billion in revenues and the modest aim to “organize the world’s information” had to run a tight ship. Anyway, it seemed implicit that in allowing Google to use my data, I could rely on Google to hold on to it—and to give it back.

In reality, I discovered, Google assumes no responsibility over user data nor is it required by law to do so. In the same notice informing me that it had disabled my account, Google told me for the first time that it reserves the right to “terminate your account at any time, for any reason, with or without notice.” In its Terms of Service, Google limits its total liability for stolen data, lost data, anything, “TO THE AMOUNT YOU PAID US TO USE THE SERVICES” (yes, in all caps), which could mean as much as the $2.49 per month you shelled out for 25GB more storage or in my case, nothing.

Google not only reserves the right to take away or vaporize our data for any reason, but it also reserves the right to discontinue services, the means to access it, whenever it wants. It does this more often than you probably realize and most recently with Google Reader, which disappears on July 1.

In case you’re wondering, in the end, I was fortunate. By Monday, a Googler filed the right internal escalation paperwork on my behalf and on Tuesday morning, six days after I lost access to my account, relayed that it had been restored.

My data was intact save for the last thing I’d worked on–a spreadsheet containing a client’s account numbers and passwords. It seems that Google’s engineers determined this single document violated policy and locked down my entire account. My request to get that document back is still pending.

I returned to the Google fold with eyes wide open to my responsibilities as a user. In relationship terms, I am no longer monogamous. I store my data on other servers maintained by providers like Evernote, Dropbox, and WordPress, and the cloud is my standby, not my steady. I’ve swapped convenience for control: I back up my email and what I care about most on physical hard drives.

More HERE

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For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC,  AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

List of backup or "mirror" sites here or  here -- for when blogspot is "down" or failing to  update.  Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)

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Flight Delay Rebuke:  Congress exposes the FAA's air-traffic furlough gambit

It isn't quite Ronald Reagan breaking the 1981 air-traffic controllers strike by firing 12,345 of them, banning them from government employment for life, and decertifying their union. But it's close enough for cheering. On Thursday night the Senate unanimously reversed the Federal Aviation Administration's sequester furloughs, and the House followed on Friday with a veto-proof majority, 361 to 41.

Remember when the sequester's spending cuts were going to incite mass uprisings for higher taxes? Instead, Senate Democrats and the White House blinked, not least because the FAA's transparent political strategy was to use incompetent government as a bludgeon on behalf of bigger government. The American public waiting in departure lounges figured this out, which is presumably why the political capitulation is so total.

The FAA's all-hands furloughs managed to convert a less than 4% FAA budget cut into a 10% air-traffic control cut that would delay 40% of flights. The 6,700 flights that the FAA threatened to force off schedule every day is twice as many delays as the single worst travel day of 2012.

Passengers with their baggage check in for a flight at Los Angeles International Airport (LAX) on Wednesday.
The Democratic surrender has non-elected liberals in full revolt, claiming Washington somehow bowed to wealthy business travellers-as if the 99% don't save for vacations and two million people aren't in the air every day. Their advice is that the White House should have let the delays mount until Congress also agreed to turn off the entire sequester for low-income housing grants, Meals on Wheels and everything else.

Let us hope for the sake of the poor that other bureaucracies are managing the modest sequester cuts more responsibly than the FAA. But the larger point is that from the beginning the FAA's delays were deliberate and avoidable. The FAA has ample legal discretion to protect core services but chose instead to maximize disruption. It is a sign of the FAA's institutional culture of failure that it can't even sabotage itself successfully.

The Senate bill clarifies that the FAA has the authority to cut waste and nonessential items before it lays off controllers-which the White House falsely claimed the sequester law prohibited it from doing. The six-page bill also specifically identifies $253 million in discretionary unspent airport grants that can be used for air control instead. That's among the $34 billion in so-called "unobligated funds" that the Department of Transportation has on hand this year despite sequestration.

Prior to its bipartisan humiliation, the FAA tried to promote the illusion that it was doing a good job until the sequester came along. While we're glad passengers will now endure fewer pointless delays, the FAA will be dysfunctional no matter how much money it gets and deserves to be punished for its recklessness with a more Reaganesque solution.

To wit, Congress ought to abolish the FAA and privatize the air navigation system the way that Canada and other developed countries have. A nonprofit corporation funded by user fees would make better cost-benefit decisions, tap capital markets, replace old-fashioned technology in a timely way and discipline high labor costs.

In addition to NavCanada, Germany, France, Australia and more than 50 others have made the transition to commercial airspaces. No less than Al Gore tried do this when he was Vice President, only to be routed by the unions. Republicans should try again as a plank of a platform to reform and modernize a government that serves itself before it serves America.

President Obama's latest sequestration gambit backfired for the same reason his previous attempts this year have flopped. The sequester cuts, while often dumb, aren't hollowing out the basic services that voters expect from their government. They are showing instead that government can safely and sensibly be cut if politicians are willing to set priorities and make choices.

SOURCE

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New study confirms economy was destroyed by Democrat policies

A new study from the widely respected National Bureau of Economic Research released this week has confirmed beyond question that the left's race-baiting attacks on the housing market (the Community Reinvestment Act--enacted under Carter, made shockingly more aggressive under Clinton) is directly responsible for imploding the housing market and destroying the economy.

The study painstakingly sorted through failed home loans that caused the housing market collapse and identified an overwhelming connection between them and CRA mortgages.

Again, let's review:

-President Bush went to Congress repeatedly for years warning them that Fannie Mae and Freddie Mac were going to destroy the economy (17 times in 2008 alone). Democrats continuously ignored him, shut down his proposals along party lines and continued raiding the institutions for campaign contributions on their way down.

-John McCain also co-sponsored urgently critical reforms that would have prevented the housing market collapse, but Democrats shut that down as well, along party lines, and even openly ridiculed anyone who suggested reforms were necessary...to protect their taxpayer-funded campaign contributions as the economy raced uncontrollably toward the cliff.

-No one was making bad loans to unqualified people until Democrats came along and threatened to drag banks into court and have them fined and branded as racists if they didn't go along with the left's Affirmative Action lending policies...all while federally insuring their losses. Even the New York Times warned in the late 1990s that Democrats continuing to force banks into lowering their standards would lead to this exact catastrophe.

-Obama himself is even on the record personally helping sue one lender (Citibank) into lowering its lending standards to include people from extremely poor and unstable areas, which even one of the left's favorite blatantly partisan "fact-checkers," Snopes, admits (while pretending to 'set the record straight').

-Even The New York Times admitted that there is "little evidence" of any connection between the "Republican" deregulation measures Obama blames, like the Gramm-Bleach-Liley Act (signed into law by a Democrat), and the collapse of the housing market.

But non-Fox media have spent years deliberately and relentlessly inoculating people against the facts, training them to mindlessly blame Bush for being in charge when Democrat policies destroyed the economy. So here we sit, to this day, still watching Obama excuse and shrug off endless economic failures, illegal government takeovers and utter national bankruptcy with zero accountability.

SOURCE

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Is Media Blacking Out Story of Pro-Life Catholic School Bus Fire-Bombing?

Our team here at LibertyNEWS.com is pretty much aware of everything crossing the wires throughout the day. Yesterday, from our view, the wires failed to include a particularly peculiar story about a school bus being fire-bombed in Illinois. The school bus belonged to Our Lady of the Sacred Heart Academy and reports from local sources suggest the incident may have occurred as retaliation for the closing of an abortion facility in Rockford, IL.

Pro-Life Corner has more:

"A large school bus, owned by Our Lady of the Sacred Heart Academy, that is well known throughout Rockford for its beautiful pro-life pictures and words asking people to"pray to end abortion",  was fire bombed on Friday night.  The damage was extensive to the bus as windows were broken in on both sides and fire bombs were thrown inside to cause maximum damage.It has been speculated that this bombing of a pro-life Christian school bus is in retaliation for the closing of the Rockford abortion mill that is located not far from where the school bus was attacked."

Not only has the media largely ignored this story, the local media was engaged in propaganda against the pro-life agenda the very day the fire-bombing occurred:

"On the day this pro-life school bus was viciously attacked, the Rockford Register Star ran a story about an attack against a building made by a pro-lifer TWELVE YEARS AGO!
They brought up again the story of Fr. John Earl who damaged the Rockford abortion mill in 2000.  Fr. Earl paid his debt to society and has been a model citizen ever since for over a decade, but the Register Star brings up that 12 YEAR OLD STORY again, using Father Earl's reassignment to a new parish as an opportunity to rehash what should now be a thing of the past  and yet they ignored a current attack- the firebombing of a pro-life school bus."

Where is the media on this? How is it not news that a possible hate crime just took place against a Pro-Life Catholic academy?

SOURCE

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Welfare, lax immigration control and  "Celebrating Diversity" created two terrorist monsters

Not only were Tamerlan, the Boston terrorist currently burning in Hell, and Dzhokhar, the Boston terrorist soon to be burning in Hell, on welfare, but their whole family was on the government dole.

This isn't as much a case against welfare as it is a case against immigration reform. In their time in this country this family did nothing but take and added nothing but misery.

The famous plaque at the Statue of Liberty reading, "Give me your tired, your poor, your huddled masses yearning to breathe free" is a not the call for every degenerate, miscreant and slacker to come suckle the government teat as liberals would have you believe. In fact, the whole poem is a beacon of hope saying anyone can come here and make of their life what they will.

It's the story of America. It's the hope and opportunity that your life will be as good as you can make it, unlike most of the rest of the world. We have no caste system, the only limits on your life are set by you and your abilities. It is declaring that we are the only nation where someone can do anything, where even the child of worthless, absentee parents who shirk their responsibility can grow up to be president.

Enter the Tsarnaevs.

They came to this country legally.and got on welfare. Why was a family that literally brought nothing to the table allowed to immigrate? I haven't seen an answer yet, but I suspect asking the question will be called "bigoted." As would asking why we should legalize millions of unskilled workers when we have too many of them already.

In the days since the Boston terrorist attack, we've learned the Tsarnaev family - except for Uncle Ruslan - is exactly the type of people a functional immigration system should be designed to keep out. It's not, and despite all the lip-service being paid by advocates, the "reform" making its way through the U.S. Senate won't do anything about it either.

That the Tsarnaev family, a group exhibiting behavior rarely seen outside of meth-infested trailer parks, came to this country and took, then left and left these children behind is a disgrace. That so many on the political left have even entertained the idea, now being pushed by Mama Tsarnaev, that America is somehow to blame for their radicalization is an even bigger one.

It started when The Atlantic's Marc Ambinder asked, "What is it about America that so alienates young men?" in the context of wondering about "the possibility that something about America is radicalizing people of all sorts." Others soon followed suit in suggesting America had a major share of the blame, including the woman from whose loins these creatures sprang.

Well, I'll take the bait.

Aside from what appears to be awful parenting, the Tsarnaev boys were immediately engulfed in a progressive ideology. Generous social services for all-comers is a staple of the left's Utopian philosophy. They lived in a progressive state, attended schools similar to those across the country where self-esteem was given, not earned, and still turned out to be monsters.well, you see where this is going.

The progressive philosophy is designed to make you "feel" good about yourself, but for merely existing, not doing anything. It's designed to "celebrate diversity," not assimilation. This line of thinking not only granted cover to the Tsarnaevs to care about their former homeland more than the one providing for them, but "alienated" them from this country more than anything else.

The United States has a history of self-segregation. Every major city has a "Little Italy," "Chinatown" and the like, but they've shrunk. They didn't shrink because outside forces overtook them, they were overtaken by outside forces because the goal was to assimilate. New immigrants moved there as a transition from their old home to their new one. They lived there while they learned the language, culture and the ability to move out. Progressives have reversed this trend.

This trend has been reversed to the point that the winner of the $338 million lottery winner in New Jersey, who immigrated to this country 26 years ago, needed a translator at his press conference to express his joy.

New immigrants are told they don't have to assimilate, that they shouldn't. Not that they have to give up their culture, but suggesting they might want to embrace the culture and language of their new homeland is now a bridge too far. Perhaps that was a factor in why immigrants who've lived here for nearly all of the impressionable part of their lives would identify more with a land that is nothing more than a distant memory than the one that welcomed them.

So if progressives seek to assign responsibility for why the terrorist now burning in Hell and the other terrorist who should soon join him in those flames felt alienated from society, they need look no further than the nearest reflective surface.

Of course blame for any terrorist attack lies firmly with the perpetrators. But since liberal progressives seek to assign blame elsewhere, have no delusions that if there is any extra to go around it is firmly on their hands.

SOURCE

There is a  new  lot of postings by Chris Brand just up -- on his usual vastly "incorrect" themes of race, genes, IQ etc

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For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC,  AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

List of backup or "mirror" sites here or  here -- for when blogspot is "down" or failing to  update.  Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)

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The Alleged Hatred in the Heart of White America

Leftists see hate where there is none -- because hate fills their own hearts.  They judge others by themselves

It was cool and rainy Sunday morning when the bomb ripped through the building. At 10:22, a group of children was just heading into the basement to hear a sermon at the 16th Street Baptist Church in Birmingham, Ala. According to a Washington Post account at the time: Dozens of survivors, their faces dripping blood from the glass that flew out of the church's stained glass windows, staggered around the building in a cloud of white dust raised by the explosion.

Four girls were killed. The head of one little girl was found far from her body. Twenty-two others were injured. Wandering through his devastated church, the Rev. John H. Cross found a megaphone and asked the enraged and stunned crowd to disperse. "The Lord is our shepherd," he sobbed, "we shall not want."

This week, Congress marked the 50th anniversary of that terror attack by posthumously awarding the Congressional Gold Medal to Denise McNair, Carole Robertson, Addie Mae Collins and Cynthia Wesley.

We Americans are not confused about the morality of what happened in Birmingham that September morning in 1963, nor during the Jim Crow era in America generally. We do not hesitate to condemn utterly the behavior and the beliefs of the Ku Klux Klan (the perpetrators of this bombing and others) and their white supremacist fellow travelers. We do not worry that reviling white supremacists and their grotesque deeds will somehow taint all white people.

But when it comes to other groups and other motives for the same kind of terrorism — we lose our moral focus. Bill Ayers, Bernadine Dohrn and Kathy Boudin have become honored members of the faculties at leading universities. Ayers is even the friend of the president of the United States. Regarding his own record of setting bombs that kill and dismember innocent people, Ayers told The New York Times on the ironic date of Sept. 11, 2001 that "I feel we didn't do enough ... (there's) a certain eloquence to bombs, a poetry and a pattern from a safe distance." So says a retired "distinguished professor" at the University of Illinois at Chicago.

Today, American liberals are obsessed not with terrorism but with the color and ethnicity of terrorists. They can readily enough attribute violent tendencies to groups they dislike — the tea party, for example, which hasn't committed so much as a littering offense. But when it comes to Islamic terrorism, their voices falter.

Attorney General Eric Holder, asked whether three attacks on the United States (the underwear bomber, the Times Square bomber and Maj. Nidal Hassan) could be attributed to "Islamic" radicalism, refused to say so. Asked repeatedly whether religious motives played a role, Holder would say only, "there are a variety of reasons why people have taken these actions." Janet Napolitano has been quick to dismiss terror attempts as "one offs." Would Holder and Napolitano say the same about white supremacists? Each one had his own motivations and we can't surmise what those factors were?

There is a tendency among many on the left to temper their disgust and indignation at political violence (i.e. terror) if the terrorist is from the "correct" group. "Muslim ... means not being white" Peter Beinert writes in the Daily Beast.

Beinert and other liberals imagine that the U.S. is a cauldron of teeming racism with the lid barely kept down. At the first acknowledgment that Islamists (some, but by no means, all of whom are dark skinned) present a continuing threat, the lid will fly off and white American vigilantes, given permission, will start shooting black and brown people on the streets, burning their shops, and bombing mosques.

The hatred that Islamism preaches, lauds and inspires is a nuisance, liberals may concede. But the hatred in the heart of "white America" is the greater danger.

SOURCE

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Obama’s Labor Secretary nominee, Thomas Perez, is radical and unethical

by Hans Bader

A Senate committee will soon vote on Obama’s nomination of left-wing radical Thomas Perez as Labor Secretary. Perez, currently the assistant attorney general for civil rights, has been described by Cato Institute lawyer Ilya Shapiro as a man “who personifies … this administration’s flouting of the rule of law.”

The Senate Health, Education, Labor, and Pensions Committee will decide on the Perez nomination. Shapiro provides this “recap of Perez’s nefarious dealings” (drawing on the work of journalist Quin Hillyer, who provides more detail at this link):

*    Interference with the Supreme Court case of Magner v. Gallagher, getting the City of St. Paul to dismiss its appeal to prevent what would’ve been a sharp rebuke to the federal government regarding its use of “disparate impact” racial theories in housing policy. [I discussed Perez's misuse of "disparate impact" law here]

*    Refusal to comply with subpoenas from the U.S. Commission on Civil Rights [which I earlier discussed here];

*    Dismissal of the Justice Department’s already-won prosecution of the Black Panthers for voter intimidation during the 2008 election [which I previously discussed at this link];

*    Running a department dedicated to the proposition that voting rights and other civil rights law don’t protect white people [I discussed one such example here, and federal court rulings rejecting this false proposition];

*    Willfully misleading and lying to Congress under oath several times [for example, U.S. District Judge Reggie Walton concluded that Perez made false claims about the Obama Justice Department's dismissal of the case against Black Panthers for voter intimidation];

*    Racial abuse of the New York fire department, to the detriment of public safety and qualified minority applicants;

*   Hiring for “career” (non-political appointee) slots only attorneys who have demonstrable left-wing credentials—making Alberto Gonzales’s politicized-hiring foibles look like the model of civil service administration [see examples here];

*    Trampling on religious liberties to the point the Supreme Court unanimously rejected his arguments in Hosanna-Tabor v. EEOC regarding the “ministerial exception” to employment laws;

*   Conducting government business from a personal email account as many as 1,200 times (!) and now refusing to comply with congressional subpoenas to release those emails. [Lawyers at the Competitive Enterprise Institute (CEI) have repeatedly uncovered such abuses, and the use of false-identity alias email addresses, by Obama administration officials, as you can see here and here].

CEI earlier discussed the Magner case and why the Obama Administration’s position in that case could undermine the stability of the financial system and cause future financial meltdowns. (CEI joined in an amicus brief opposing the Obama Administration’s position, in the Supreme Court). It also highlighted the Obama administration’s (and Perez’s) massive, ethically dubious payoff to the City of Saint Paul to drop the case.  CEI and legal commentators also chronicled the Obama Administration’s use of meritless discrimination lawsuits to pay off trial lawyers at taxpayers’ expense (culminating in a New York Times story today about massive fraud in the Pigford case).

Earlier, I discussed the Obama Administration’s extreme position in the Supreme Court’s Hosanna-Tabor case and how it would have undermined First Amendment freedoms, religious autonomy and the separation of church and state. I also chronicled the Justice Department’s politicized hiring during the Obama Administration.

SOURCE

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As health care gets more bureaucratic,  many  doctors will drop out

Jeffrey A. Singer

I am a general surgeon with more than three decades in private clinical practice. And I am fed up. Since the late 1970s, I have witnessed remarkable technological revolutions in medicine, from CT scans to robot-assisted surgery. But I have also watched as medicine slowly evolved into the domain of technicians, bookkeepers, and clerks.

Government interventions over the past four decades have yielded a cascade of perverse incentives, bureaucratic diktats, and economic pressures that together are forcing doctors to sacrifice their independent professional medical judgment, and their integrity. The consequence is clear: Many doctors from my generation are exiting the field. Others are seeing their private practices threatened with bankruptcy, or are giving up their autonomy for the life of a shift-working hospital employee. Governments and hospital administrators hold all the power, while doctors—and worse still, patients—hold none.

The Coding Revolution

At first, the decay was subtle. In the 1980s, Medicare imposed price controls upon physicians who treated anyone over 65. Any provider wishing to get compensated was required to use International Statistical Classification of Diseases (ICD) and Current Procedural Terminology (CPT) codes to describe the service when submitting a bill. The designers of these systems believed that standardized classifications would lead to more accurate adjudication of Medicare claims.

What it actually did was force doctors to wedge their patients and their services into predetermined, ill-fitting categories. This approach resembled the command-and-control models used in the Soviet bloc and the People’s Republic of China, models that were already failing spectacularly by the end of the 1980s.

Before long, these codes were attached to a fee schedule based upon the amount of time a medical professional had to devote to each patient, a concept perilously close to another Marxist relic: the labor theory of value. Named the Resource-Based Relative Value System (RBRVS), each procedure code was assigned a specific value, by a panel of experts, based supposedly upon the amount of time and labor it required. It didn’t matter if an operation was being performed by a renowned surgical expert—perhaps the inventor of the procedure—or by a doctor just out of residency doing the operation for the first time. They both got paid the same.

Hospitals’ reimbursements for their Medicare-patient treatments were based on another coding system: the Diagnosis Related Group (DRG). Each diagnostic code is assigned a specific monetary value, and the hospital is paid based on one or a combination of diagnostic codes used to describe the reason for a patient’s hospitalization. If, say, the diagnosis is pneumonia, then the hospital is given a flat amount for that diagnosis, regardless of the amount of equipment, staffing, and days used to treat a particular patient.

As a result, the hospital is incentivized to attach as many adjunct diagnostic codes as possible to try to increase the Medicare payday. It is common for hospital coders to contact the attending physicians and try to coax them into adding a few more diagnoses into the hospital record.

Medicare has used these two price-setting systems (RBRVS for doctors, DRG for hospitals) to maintain its price control system for more than 20 years. Doctors and their advocacy associations cooperated, trading their professional latitude for the lure of maintaining monopoly control of the ICD and CPT codes that determine their payday. The goal of setting their own prices has proved elusive, though—every year the industry’s biggest trade group, the American Medical Association, squabbles with various medical specialty associations and the Centers for Medicare and Medicaid Services (CMS) over fees.

As goes Medicare, so goes the private insurance industry. Insurers, starting in the late 1980s, began the practice of using the Medicare fee schedule to serve as the basis for negotiation of compensation with the doctors and hospitals on their preferred provider lists. An insurance company might offer a hospital 130 percent of Medicare’s reimbursement for a specific procedure code, for instance.

The coding system was supposed to improve the accuracy of adjudicating claims submitted by doctors and hospitals to Medicare, and later to non-Medicare insurance companies. Instead, it gave doctors and hospitals an incentive to find ways of describing procedures and services with the cluster of codes that would yield the biggest payment. Sometimes this required the assistance of consulting firms. A cottage industry of fee-maximizing advisors and seminars bloomed....

As the third party payment system led health care costs to escalate, the people footing the bill have attempted to rein in costs with yet more command-and-control solutions. In the 1990s, private insurance carriers did this through a form of health plan called a health maintenance organization, or HMO. Strict oversight, rationing, and practice protocols were imposed on both physicians and patients. Both groups protested loudly. Eventually, most of these top-down regulations were set aside, and many HMOs were watered down into little more than expensive prepaid health plans.

Then, as the 1990s gave way to the 21st century, demographic reality caught up with Medicare and Medicaid, the two principal drivers of federal health care spending.

Twenty years after the fall of the Iron Curtain, protocols and regimentation were imposed on America’s physicians through a centralized bureaucracy. Using so-called “evidence-based medicine,” algorithms and protocols were based on statistically generalized, rather than individualized, outcomes in large population groups.

While all physicians appreciate the development of general approaches to the work-up and treatment of various illnesses and disorders, we also realize that everyone is an individual—that every protocol or algorithm is based on the average, typical case. We want to be able to use our knowledge, years of experience, and sometimes even our intuition to deal with each patient as a unique person while bearing in mind what the data and research reveal.

On more than one occasion I have seen patients develop dramatic postoperative bruising and bleeding because of protocol-mandated therapies aimed at preventing the development of blood clots in the legs after surgery. Had these therapies been left up to the clinical judgment of the surgeon, many of these patients might not have had the complication.

Operating room and endoscopy suites now must follow protocols developed by the global World Health Organization—an even more remote agency. There are protocols for cardiac catheterization, stenting, and respirator management, just to name a few.

Patients should worry about doctors trying to make symptoms fit into a standardized clinical model and ignoring the vital nuances of their complaints. Even more, they should be alarmed that the protocols being used don’t provide any measurable health benefits. Most were designed and implemented before any objective evidence existed as to their effectiveness.

One of my colleagues, a noted pulmonologist with over 30 years’ experience, fears that teaching young physicians to follow guidelines and practice protocols discourages creative medical thinking and may lead to a decrease in diagnostic and therapeutic excellence. He laments that “‘evidence-based’ means you are not interested in listening to anyone.”

More HERE

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For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC,  AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

List of backup or "mirror" sites here or  here -- for when blogspot is "down" or failing to  update.  Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)

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George W. Bush is smarter than you

 by Keith Hennessey

The new George W. Bush Presidential Center is being dedicated this week. This seems like a good time to bust a longstanding myth about our former President, my former boss.

I teach a class at Stanford Business School titled "Financial Crises in the U.S. and Europe." During one class session while explaining the events of September 2008, I kept referring to the efforts of the threesome of Hank Paulson, Ben Bernanke, and Tim Geithner, who were joined at the hip in dealing with firm-specific problems as they arose.

One of my students asked "How involved was President Bush with what was going on?" I smiled and responded, "What you really mean is, `Was President Bush smart enough to understand what was going on,' right?"

The class went dead silent. Everyone knew that this was the true meaning of the question. Kudos to that student for asking the hard question and for framing it so politely. I had stripped away that decorum and exposed the raw nerve.

I looked hard at the 60 MBA students and said "President Bush is smarter than almost every one of you."

More silence.  I could tell they were waiting for me to break the tension, laugh, and admit I was joking.

I did not. A few shifted in their seats, then I launched into a longer answer. While it was a while ago, here is an amalgam of that answer and others I have given in similar contexts.

*    "I am not kidding. You are quite an intelligent group. Don't take it personally, but President Bush is smarter than almost every one of you. Were he a student here today, he would consistently get "HP" (High Pass) grades without having to work hard, and he'd get an "H" (High, the top grade) in any class where he wanted to put in the effort.

*    For more than six years it was my job to help educate President Bush about complex economic policy issues and to get decisions from him on impossibly hard policy choices. In meetings and in the briefing materials we gave him in advance we covered issues in far more depth than I have been discussing with you this quarter because we needed to do so for him to make decisions.

*    President Bush is extremely smart by any traditional standard. He's highly analytical and was incredibly quick to be able to discern the core question he needed to answer. It was occasionally a little embarrassing when he would jump ahead of one of his Cabinet secretaries in a policy discussion and the advisor would struggle to catch up. He would sometimes force us to accelerate through policy presentations because he so quickly grasped what we were presenting.

*    I use words like briefing and presentation to describe our policy meetings with him, but those are inaccurate. Every meeting was a dialogue, and you had to be ready at all times to be grilled by him and to defend both your analysis and your recommendation. That was scary.

*    We treat Presidential speeches as if they are written by speechwriters, then handed to the President for delivery. If I could show you one experience from my time working for President Bush, it would be an editing session in the Oval with him and his speechwriters. You think that me cold-calling you is nerve-wracking? Try defending a sentence you inserted into a draft speech, with President Bush pouncing on the slightest weakness in your argument or your word choice.

*    In addition to his analytical speed, what most impressed me were his memory and his substantive breadth. We would sometimes have to brief him on an issue that we had last discussed with him weeks or even months before. He would remember small facts and arguments from the prior briefing and get impatient with us when we were rehashing things we had told him long ago.

*    And while my job involved juggling a lot of balls, I only had to worry about economic issues. In addition to all of those, at any given point in time he was making enormous decisions on Iraq and Afghanistan, on hunting al Qaeda and keeping America safe. He was making choices not just on taxes and spending and trade and energy and climate and health care and agriculture and Social Security and Medicare, but also on education and immigration, on crime and justice issues, on environmental policy and social policy and politics. Being able to handle such substantive breadth and depth, on such huge decisions, in parallel, requires not just enormous strength of character but tremendous intellectual power. President Bush has both."

On one particularly thorny policy issue on which his advisors had strong and deep disagreements, over the course of two weeks we (his senior advisors) held a series of three 90-minute meetings with the President. Shortly after the third meeting we asked for his OK to do a fourth. He said, "How about rather than doing another meeting on this, I instead tell you now what each person will say." He then ran through half a dozen of his advisors by name and precisely detailed each one's arguments and pointed out their flaws. (Needless to say there was no fourth meeting.)

Every prominent politician has a public caricature, one drawn initially by late-night comedy joke writers and shaped heavily by the press and one's political opponents. The caricature of President Bush is that of a good ol' boy from Texas who is principled and tough, but just not that bright.

That caricature was reinforced by several factors:

*    The press and his opponents highlighted President Bush's occasional stumbles when giving a speech. President Obama's similar verbal miscues are ignored. Ask yourself: if every public statement you made were recorded and all your verbal fumbles were tweeted, how smart would you sound? Do you ever use the wrong word or phrase, or just botch a sentence for no good reason? I know I do.

*    President Bush intentionally aimed his public image at average Americans rather than at Cambridge or Upper East Side elites. Mitt Romney's campaign was predicated on "I am smart enough to fix a broken economy," while George W. Bush's campaigns stressed his values, character, and principles rather than boasting about his intellect. He never talked about graduating from Yale and Harvard Business School, and he liked to lower expectations by pretending he was just an average guy. Example: "My National Security Advisor Condi Rice is a Stanford professor, while I'm a C student. And look who's President. "

*    There is a bias in much of the mainstream press and commentariat that people from outside of NY-BOS-WAS-CHI-SEA-SF-LA are less intelligent, or at least well educated. Many public commenters harbor an anti-Texas (and anti-Southern, and anti-Midwestern) intellectual bias. They mistakenly treat John Kerry as smarter than George Bush because John Kerry talks like an Ivy League professor while George Bush talks like a Texan.

*   President Bush enjoys interacting with the men and women of our armed forces and with elite athletes. He loves to clear brush on his ranch. He loved interacting with the U.S. Olympic Team. He doesn't windsurf off Nantucket, he rides a 100K mountain bike ride outside of Waco with wounded warriors. He is an intense, competitive athlete and a "guy's guy." His hobbies and habits reinforce a caricature of a [dumb] jock, in contrast to cultural sophisticates who enjoy antiquing and opera. This reinforces the other biases against him.

I assume that some who read this will react automatically with disbelief and sarcasm. They think they know that President Bush is unintelligent because, after all, everyone knows that. They will assume that I am wrong, or blinded by loyalty, or lying. They are certain that they are smarter than George Bush.

I ask you simply to consider the possibility that I'm right, that he is smarter than you.

If you can, find someone who has interacted directly with him outside the public spotlight. Ask that person about President Bush's intellect. I am confident you will hear what I heard dozens of times from CEOs after they met with him: "Gosh, I had no idea he was that smart."

At a minimum I hope you will test your own assumptions and thinking about our former President. I offer a few questions to help that process.

*    Upon what do you base your view of President Bush's intellect? How much is it shaped by the conventional wisdom about him? How much by verbal miscues highlighted by the press?

*   Do you discount your estimate of his intellect because he's from Texas or because of his accent? Because he's an athlete and a ranch owner? Because he never advertises that he went to Yale and Harvard?

*    This is a hard one, for liberals only. Do you assume that he is unintelligent because he made policy choices with which you disagree? If so, your logic may be backwards. "I disagree with choice X that President Bush made. No intelligent person could conclude X, therefore President Bush is unintelligent." Might it be possible that an intelligent, thoughtful conservative with different values and priorities than your own might have reached a different conclusion than you?  Do you really think your policy views derive only from your intellect?

And finally, if you base your view of President Bush's intellect on a public image and caricature shaped by late night comedians, op-ed writers, TV pundits, and Twitter, is that a smart thing for you to do?

SOURCE

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Report from the old sod

The vast majority of the West lives in comfort unimaginable to people of the recent past. Our poor don’t suffer from starvation, they suffer from obesity. Supposedly impoverished youths rioting in London don’t steal bread, they steal iPods.

Decadence is nothing new to the West, but one country’s recent economic downturn serves as a fascinating look at the phenomenon in a modern context: Ireland. It is the land of my birth and where I have lived most of my life and it serves as a microcosm of greater Western malaise.

The Celtic Tiger boom that occurred in Ireland - beginning roughly in the late nineties and lasting until 2007 - was a period of economic growth unmatched by any other in the country’s history. Ireland was always an outlier in Western Europe, both geographically and figuratively. It was conservative, religious and poor. The boom changed all that and by 2005 The Economist ranked Ireland number one in the world for quality of life.

During all this, something strange happened. Throughout history the Irish had been a people who gazed out upon the world, emigrating in droves. But with the advent of prosperity they ceased to do so. They developed a myopia which seemingly prevented them taking notice of anything beyond Irish shores.

A massive growth in property prices accompanied the boom. Prices for even modest houses skyrocketed. Non-descript suburban homes sold for over half a million euro and a seven-bedroom red-brick in South Dublin sold for €58 million. Nobody asked why a three-bedroom semi-detached house in nowheresville cost more than similar properties in central Frankfurt or Helsinki. Nobody took the slightest notice of the property market collapse in Singapore. Ireland became so wealthy its people could afford to be completely oblivious to economic reality. The rest of the world became a place Irish people went on holiday, not a place to learn lessons from.

This infuriating ignorance hasn’t gone away. It simply manifests itself in different ways.

If one was to measure the success of a nation one would probably start by looking at markers like GDP per capita and the country’s United Nations Human Development Index rank, and so on. By these measurements Ireland comes near the top of the global pecking order. The country has the 11th highest average income in the world (World Bank, 2011) and is 7th in the world on the Human Development Index. Basic social welfare payments are among the among the most generous anywhere. The country is, by all accounts, an extremely wealthy corner of the planet.

You wouldn’t think this by talking to Irish people, though. The phrase ‘the country is on its knees’ is used with such frequency that you could be forgiven for thinking an angel gets its wings every time it’s uttered. Ireland’s sinking from the richest country in the world to a poverty-stricken 11th is apparently an affront to the dignity of the Irish. Some argue the tired line that during the good times the rich got richer and the poor got poorer, skewing the GDP statistic, but that is nonsense. Income inequality was reduced substantially in Ireland during the boom, actually bucking a global trend.

Quoting the abovementioned favourable rankings to the general populace will usually be met with inane cynicism. The essence of Irish political discourse is to negatively criticise politicians until losing sight of reality. Statesmen like WT Cosgrave who oversaw a peaceful handover of power while the nation was in its infancy trail behind the Left’s misguided figureheads in popularity contests.

There is no acknowledgement by the Left of the role neo-liberal free market principles had to play in making the country rich in the first place. In the Leftist’s political worldview, western prosperity and privilege is as natural as gravity or sunrise. In their alternative universe, an Ireland in 2005 under an anarcho-syndicalist government would have been as rich as it was under the centre-right coalition of Fianna Fáil and the Progressive Democrats. The only difference is that under this hypothetical Leftist government Ireland would still be a utopia today.

Relatively speaking Ireland is going through a rough patch but the country is still fantastically wealthy. Newspapers report on families barely surviving on six-figure incomes. A university professor has been quoted as saying life was ‘a struggle’ on his salary of close to a quarter million euro per annum. The Irish Times published the story of a family unable to regularly put food on the table, despite the household’s annual income being a very healthy €65,000 a year.

It’s all about priorities. But nobody’s willing to give up recent gains, even if they lived just fine without them before.

When a person gets used to a certain quality of life they naturally become agitated when their level of comfort declines even slightly. It is human nature. The corporate boss on six figures a year would consider his lifestyle severely dented by a ten thousand a year salary cut. Paris Hilton would probably commit suicide were she to wake up one morning an average working woman making thirty thousand a year, her frivolous heiress existence nothing but a memory. Similarly, a ten euro per week cut to one of the highest unemployment benefits in the world is seen by the Left as a devastation of ‘ordinary people’ in the way something truly appalling like war was only a few decades before.

People’s expectations have risen high due to globalisation, capitalism and free markets. Almost every part of the world has improved on a decade-by-decade basis over the last fifty years, especially liberal democracies. Elsewhere, too. Any time you see a rural Indonesian or Bolivian on a cell phone it means they have enough money to eat and communicate with ease. Nobody who’s hungry spends their money on phonecalls.

The Left has seized on the idea that the failure of a few banks is a victory for their politics, but it is in fact a refutation: a genuinely free market government would never have ‘bailed out’ any banks. They would have been allowed to die. It was over-regulation and protectionism that ‘brought Ireland to its knees’ (ie 11th on the global rich list).

The Irish Left deride the general public as lazy because they complain incessantly but never take to the streets in numbers large enough to realise the Left’s juvenile revolutionary fantasies. This is yet more evidence that Ireland is a fine place to be. Despite our complaining there is simply no appetite for - or need for - major change, let alone revolution. It’s not that the people are lazy or that they are especially apathetic. They’re just too comfortable, still, five years into a recession.

Despite the subconscious national contentment that exists in Ireland, the moaning and solipsism continues. Just as it was during the Celtic Tiger, Irish people in recession time cannot see a bigger picture. That Ireland is still richer than almost everywhere else in the world is simply par for the course; the natural order of things. No, the country must be richer, its public servants paid more, unemployment non-existent. In the minds of the majority, our status as a highly developed nation with ever more welfare benefits and dirt-cheap world-class university education exists in perpetuity, despite the realities of a modern world where an industrialised Asia contains billions of people who work more hours for less money.

The only comparison people make is of how we stack up to the Ireland of 2005. Nobody can see past that. It’s simply too distant.

SOURCE

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For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC,  AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

List of backup or "mirror" sites here or  here -- for when blogspot is "down" or failing to  update.  Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)

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The motivations of the Boston bombers were both  Leftist and Islamic

Ever wondered why the 9/11 bombers and many other Muslim terrorists were Western-educated?  It's because the combination of the anti-Americanism they get from Western educators (including Leftist American educators) and the violence preached by Islam  make an explosive mix.  Read the Koran (start with Surah 9) if you think Islam is a religion of peace. The Koran is full of hatred towards non-Muslims and exhortations to kill or oppress them. So it was the same old same old with the Boston bombers.  Kent Clizbe sets out the evidence below

 The Boston Marathon massacre was carried out by two Caucasian Muslim brothers, one an American citizen, pot-smoking Obama voter, the other likely a green card holder. In the aftermath, the Politically Correct Progressive (PC-Prog) media and commentators are all flabbergasted. They wondered what could be the terrorists’ motivations. Over and over, the media reported, “Dzhokhor was a normal American kid.”  President Obama, our PC-Prog leader, said, "One thing we do know is that whatever hateful agenda drove these men to such heinous acts will not — cannot — prevail."

The media probably do not even realize how close they are to the truth—Dzhokhor is a normal American kid. Raised on anti-American messages from the media, from their high school, at their university, and from Hollywood, normal American kids are bombarded with a national self-loathing designed to destroy America’s exceptional culture and values.

Although my books, Willing Accomplices and Obliterating Exceptionalism detail the origins of this suicidal hatred of America, the Boston bombers are the clearest example yet of the power of this message to destroy the lives of Americans.

It seems likely that the older brother, Tamerlan, was the driving force behind the two Tsarnaev brothers’ terrorism. It appears that he was a follower of a Lebanese-Australian extremist cleric. This Muslim preacher’s messages of hatred for Western culture were prominent on Tamerlan’s Youtube playlists.

It appears that Tamerlan recently spent six months overseas. In Russia? Or did he travel elsewhere? Did he go to Chechnya? Did he spend time in what appears to be his homeland, Dagestan, where his father lives now? Who did he meet there? What did he do there?

Dagestan and Chechnya are hotbeds of Islamic terrorism. Chechen terrorists are active around the Middle East, Afghanistan, and North Africa. Wherever there is a jihadi war, it is likely you’ll find Chechens fighting there.

We do know that Tamerlan returned “from Russia,” in the summer of 2012. His brother would have been out of high school (more about that later) for about a year. His return was about nine months before the Marathon bombing.

If Tamerlan trained on bombing and attack techniques (a couple months of intensive training is the minimum for a mujahidin terrorist), he could have returned to Boston with the attack plan fully laid out. He would have the skills required to make the bombs. He would have likely already have identified the target. And he would have the techniques required to carry out the attacks. All that would be missing was the materials to make the bombs, and an accomplice.

So, in this scenario, we have a committed, trained Islamic terrorist ready to carry out his attack. What pool will he draw from to recruit his accomplice?

Why, his “average American” brother, Dzhokhor. With his American-accented English, the younger brother graduated from the celebrated (Matt Damon went here!) Boston high school, Cambridge Rindges and Latin School (CRLS), about the same time Tamerlan was probably contemplating terrorist training.

Now we get to the interesting part. A graduate of CRLS has had years of anti-American claptrap crammed down his throat. Instead of, “Why would a normal American kid do this?” a better question is, “Why don’t all CRLS graduates become anti-American terrorists?”

PC-Prog media widely quoted a retired CRLS history teacher, Larry Aaronson’s shocked reminiscences about Dzhokhor. Aaronson told The Boston Globe, “This is a progressive town, the People's Republic, and how could this be in our midst?" Larry Aaronson, a longtime Rindge and Latin teacher who knew Dzhokhor and who lives three doors down from the brothers on Norfolk Street. "I'm at a loss. I'm at a total and complete loss."

Well, Larry, let’s start with your own handiwork. Aaronson is an acolyte of the raving PC-Prog, traditional-America-hating deceased “revisionist historian,” Howard Zinn. Zinn was a PC-Prog darling. Zinn claimed that his eyes were opened to racist, imperialist horror that is America by the KGB covert influence agent, I.F. Stone.

Aaronson (third from left in the photo at left), who retired in 2007, used to brag to anyone who would listenthat he had taught Zinn’s textbook to CLRS students since the beginning of his career in 1981. In 2008, Aaronson started Social Justice Works! The Larry Aaronson Fund, in an evident attempt to cash in on his Zinn-Damon connections.

Aaronson proudly related how his students at CLRS had included Matt Damon and Damon’s brother. He proudly told how the Damon boys were taken with the anti-American history of Zinn. Larry, in an homage to Zinn on his death in 2008, started with this quote, “You wanna read a really good American History book? Read Howard Zinn’s A People’s History of the United States. It will knock your socks off!” -Will Hunting (Matt Damon), Good Will Hunting

If you don’t know Zinn’s handiwork, here’s a sample of his writing in The Progressive. In detailing the idiocy of America’s belief that we are exceptional, Zinn’s contempt for America and its citizens fairly drips from each word, “The deeply ingrained belief--no, not from birth but from the educational system and from our culture in general that the United States is an especially virtuous nation makes us especially vulnerable to government deception. It starts early, in the first grade, when we are compelled to "pledge allegiance" (before we even know what that means), forced to proclaim that we are a nation with "liberty and justice for all.

“And then come the countless ceremonies, whether at the ballpark or elsewhere, where we are expected to stand and bow our heads during the singing of the "Star-Spangled Banner," announcing that we are "the land of the free and the home of the brave." There is also the unofficial national anthem "God Bless America," and you are looked on with suspicion if you ask why we would expect God to single out this one nation--just 5 percent of the world's population--for his or her blessing.”

Aaronson boasted that parents called him to say that their kids were talking about, “that “bastard Christopher Columbus… and his genocide, and how we have to question our history books and re-examine the evidence.” The CRLS teacher continued, “Thank you, thank you, thank you.”

With that back-story illuminated, let’s return to the PC-Prog media’s puzzling over “What could the Tsarnaev boys’ motive possibly be?”

After the Marathon massacre, the media quoted the Zinn-acolyte Aaronson in its stories about the terrorist mass murderer. Aaronson was “utterly shocked by the news.” The media reported that, “Aaronson taught social studies at Cambridge Rindge and Latin, where Dzhokhor was a student.” The media reports continued, “Dzhokhor also lives just about three houses down from Aaronson’s condo, so they would talk from time to time after Dzhokhor's graduation in 2011.

“I will say to you and to anyone who asks me,” Aaronson told WBUR’s David Boeri outside his home in Cambridge on Friday morning, “he had a heart of gold, he was a sweetheart, he was gracious, he was caring, he was compassionate.”  [That shows how good is the judgment of Mr. Leftist Aaronson]

 ABC, CBS, USA Today, NY Times, CNN all carried versions of Aaronson’s comments about “how normal” Dzhokhor, his neighbor and student was. None of the PC-Prog media provided any other background on Aaronson and his brainwashing of students at CRLS with Zinn’s history.

The Aaronson-Dzhokhor “reporting” by the PC-Prog media brings together the three PC-Prog transmission belts of American culture—education/academia, Hollywood, and the media. All three are dedicated to destroying traditional-American culture. The media reports studiously ignore the connection between Dzhokhor's anti-American lessons taught by a “social justice” weenie (Aaronson) from a book by a follower (Zinn) of a KGB covert influence agent (I.F. Stone) slyly celebrated in a Hollywood product (Matt Damon’s Good Will Hunting).

Islamic terrorism was the force that planted the bombs in Boston. PC-Progressive hatred of American exceptionalism was the motivation behind that force.

We need to let the media and Obama know: We know what hateful agenda drove Dzhokhor. It has infected our media, schools, and Hollywood for nearly 80 years. When it destroyed normal-American culture, the way was cleared for opportunistic infections to take advantage of our weakened national immune system. Islamic extremism is the most violent. But look at others gathering momentum in their destructive power—Militant environmentalists, militant homosexuals, militant anti-capitalists, militant Islamic Extremists, militant anti-war activists, militant race-baiters. All hate normal-America. All call for extreme changes to America.

This is the challenge. We conservatives must realize that PC-Progs are not “for” militant Islamic Extremists—they are simply for anything that is anti-normal-America. When the logical outcome of the PC-Prog’s constant anti-American messages throughout the culture occurs—violent acting out against normal-America, in this case marathon runners—the PC-Progs claim shock and surprise.

It’s time for the chickens to come home to roost. PC-Progs must accept the results of their decades of anti-American messages. We know Dzhokhor's motivations. I agree fully with Obama. This “hateful agenda…will not — cannot — prevail.” Now let’s rebuild our country.

SOURCE

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America doesn’t need a government-run postal service

by John Stossel

Even parts of government that look like a business never get run with the efficiency of a business. Just look at the post office.

They buy commercials and tout their services the way private businesses do. They offer a service that customers want.

But a real business can't get away with losing billions every year. (I guess in the era of bailouts, I should say shouldn't get away with it.) The post office lost $16 billion last year, despite having all sorts of advantages that most private businesses don't have.

They have a near monopoly on first-class mail delivery. You want to deliver something to someone? You better not put it in their mailbox -- that's illegal. The U.S. Postal Service doesn't pay sales tax or property tax. They don't even pay parking tickets.

With advantages like that, how do they lose money?

They are part of the government, under the thumb of Congress, and that invites calcified, inefficient behavior.

"We are expected to operate like a business, but Congress has not allowed us the flexibility to operate like a business," said Postal Service Board of Governors Chairman Mickey D. Barnett on my TV show. It's all "part of being a quasi-governmental entity. That's how the cookie crumbles." Barnett added that the post office has "union contracts that have no layoff provisions."

Reality is at odds with the proud claim on the post office's website that "Since Ben Franklin ... the Postal Service has grown and changed with America." But it's barely changed. You don't tend to see change in "quasi-governmental entities." You see stagnation.

This year the post office tried to limit Saturday delivery to save money. But Congress forbade the change. The politicians' constituents like getting their mail six days a week.

"They don't want a cut in Saturday delivery," Rep. Alan Grayson, D-Fla., told me.

"The USPS does need reform," Rep. Sam Graves, R-Mo., told the Kansas City Star. "However, reducing core services is not a long-term plan. I worry that reducing services will lead to other reductions like closing rural post offices."

But the post office should do both. The government maintains hundreds of tiny local post offices, each of which brings in less than $700 a month. Running those offices costs much more than that. Some are just one mile away from other post offices.

People like "universal service," which has been taken to mean that every American must get mail service, no matter how deep in the boondocks they live. The post office even hauls mail by mule to the bottom of the Grand Canyon.

"The post office provides something that's extremely valuable and has to be maintained, and that's universal service," Grayson told me. "There are countries a lot poorer than the United States, including the Congo ... that try to provide universal mail service to everybody. ... People don't want post offices closed!"

On the floor of Congress, Sen. Al Franken, D-Minn., proclaimed that universal service is required, saying, "It's in the Constitution."

But it's not. The Constitution says, "Congress shall have the Power to ... establish Post Offices." But it doesn't have to use that power.

Cato Institute budget analyst Tad DeHaven argues, "People living in rural America aren't living there by force. ... Go back to history. Private carriers picked up the mail from the post office and took it the last mile, or people came to the post office and picked it up."

And private alternatives are much better today. We have e-mail. UPS delivers 300 packages a minute and makes a profit. Federal Express, UPS and others thrive by finding new ways to cut costs. They don't do it because they were born nicer people. They do it because of the pressure of competition. They make money -- while the post office loses $16 billion.

Why not just privatize it? No more special government protections, no limit on competitors offering similar services.

Then mail service would be even better than before. The market delivers.

SOURCE

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Discrimination against consumer-directed health care

Health Savings Accounts are the fastest growing product in the health insurance marketplace. Currently, about 25 million families are managing some of their own healthcare dollars as a result. Virtually every serious study has found that these plans lower costs without jeopardizing the quality of care people receive. In fact, most employers have decided that giving financial incentives to employees is the most reliable way to rein in spending.

Given that one of the main goals of health reform was to lower the rate of growth of healthcare spending, it would be truly ironic if the new law makes the most reliable way of achieving the goal unavailable to millions of people. But it appears that is about to happen.

Here’s the reason. HSA plans achieve their lower premiums by having patients take more control over healthcare dollars. People pay less to the third-party payer because they agree to take responsibility for more of the expenses. Yet under the new rules for the medical loss ratio (MLR), the out-of-pocket spending from an HSA is not counted in the MLR calculation—at least for individually owned insurance.[1] Specifically, if an insurer pays for a healthcare service for their insured, that counts as a medical expense in calculating the medical loss ratio. But if an individual pays for a healthcare service to meet her deductible, that expense does not count as a medical expense for purposes of MLR calculation.

More HERE

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For more blog postings from me, see  TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH,  POLITICAL CORRECTNESS WATCH, FOOD & HEALTH SKEPTIC,  AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena (Occasionally updated) and Coral reef compendium. (Updated as news items come in).  GUN WATCH is now mainly put together by Dean Weingarten.

List of backup or "mirror" sites here or  here -- for when blogspot is "down" or failing to  update.  Email me  here (Hotmail address). My Home Pages are here (Academic) or  here (Pictorial) or  here  (Personal)

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