Thursday, October 14, 2010

The Wrong Way To Think About Inequality

In the last month, a new paper from Michael Norton and Dan Ariely has drawn some attention to the issue of wealth inequality in America. The paper, called "Building a Better America -- One Wealth Quintile at a Time," finds that Americans underestimate the inequality of America's wealth distribution and express a preference for a more equal distribution. Indeed, while the top quintile of Americans hold about 84% of national balance sheet wealth, survey respondents believe the figure is just 59% and would prefer a figure of 32%. The authors use the paper to argue for more redistributive policies -- or rather, for the insertion of these public preferences into policy debates.

The paper has been widely discussed in the blogosphere (for example by Matt Yglesias on the left and Reihan Salam on the right.) I am unimpressed with the paper for a few reasons, and generally think we should be cautious about the idea that America needs sharply more wealth redistribution (especially to the radical degree that would be implied in the paper.) I do think that there are valid reasons to be concerned about distribution of resources, or to favor more egalitarian policies, but that they are not implied by this paper.

I have three key objections to the paper. First, in asking respondents to develop ideal wealth distributions, the authors told survey respondents to imagine they would be "randomly assigned" to one of the wealth quintiles -- implying that effort plays no role whatsoever in wealth accumulation. Second, there is little reason to believe that the public is good at evaluating ideal distributions of wealth -- as demonstrated by the impossibility of the preferred wealth distribution found in the paper. Third, the paper focuses on wealth distribution, when income distribution is a better metric for inequality.

The first objection undermines the authors' finding that Americans would prefer a highly equal distribution of wealth, where the top quintile's wealth holdings (32%) would outstrip the bottom quintile's (11%) by less than three-to-one. (In fact, the bottom two quintiles in America hold approximately zero net wealth.) In forming this ideal distribution, respondents were told they would be "randomly assigned to a place in the distribution... from the very richest to the very poorest."

Essentially, they were being told to discount the possibility that they would work to improve their lot in the distribution, if they so chose. They also were not advised that the economic policies required to achieve such an equal wealth distribution would shrink the economy overall. This question framing may have helped point respondents to endorse a wealth distribution that could not be produced by a set of policies observed in any country with a high degree of human development.

This leads to by second objection. I noted that respondents expressed a preference for a wealth distribution with 11% of wealth in the hands of the bottom quintile. In a section of the paper called "Americans Prefer Sweden," the authors note that over 90% of respondents prefer a wealth distribution modeled on Sweden's, including 11% of wealth for the bottom 20% of people, to that of the United States.

Except that Sweden's bottom quintile doesn't actually hold anywhere close to 11% of that country's wealth. If you notice footnote 2 of the paper, you'll see this comment: "We used Sweden's income rather than wealth distribution because it provided a clearer contrast to the equal and United States wealth distributions; while more equal than the United States' wealth distribution, Sweden's wealth distribution is still extremely top heavy."

That is, the authors took a completely different measure of inequality and presented it as a chart of wealth distribution by quintile -- the chart does not represent a wealth distribution actually observed in a country. In fact, it is unlikely that any advanced country has a wealth distribution with anywhere close to 11% of wealth held by the bottom quintile.

There is a reason that the bottom two quintiles of households have essentially no net worth, in countries all around the world: people with low incomes tend to consume their incomes rather than saving them. They do this partly because saving is a luxury relative to their consumption options, and partly because they expect higher incomes in later years and are smoothing consumption over their lifetimes. This is true even in countries with significantly lower income inequality than the United States, such as Germany.

Unlike income distributions, the World Bank doesn't produce international comparisons of wealth allocation. But the paper that Norton and Ariely cite for wealth distribution statistics has figures for a number of countries. Of the figures it contains, the highest wealth share for a bottom quintile in an advanced country is 2.1 percent, in Japan -- a far cry from 11 percent. (China's bottom quintile holds 2.8 percent of that country's wealth.)

Other advanced countries closely track the minus 0.1 percent figure in the United States, which means that bottom-quintile households have slightly more debt than assets: minus 0.2 percent in Germany, 0 percent in Australia. (There is something screwy with the figures for Denmark and Sweden, which show the least-wealthy household quintiles having sharply negative net wealth; that seems unlikely, and the source data are in a language I don't speak.)

A drop in income inequality would largely serve to increase consumption by poor households (a perfectly reasonable policy goal), not to increase their wealth. No plausible set of tax-and-transfer policies could produce the wealth distribution advocated in this paper. The only way you could get the bottom quintile's wealth share into double digits would be to force these households to save large shares of their income that they would prefer to consume.

For example, if we achieved Sweden's income distribution (the most equal among the world's advanced countries) we would also need to have equal saving rates in each quintile in order for the bottom quintile to hold 11 percent of wealth. This would not be desirable: low-income households get more utility from saving less and consuming more.

So, what should we make of the fact that 92 percent of study participants thought a wealth distribution with 11 percent in the hands of the bottom quintile looked better than the actual wealth distribution in the United States? I'd say the key takeaway is that members of the public are not good at looking at pie charts of wealth distribution and deciding which represents a good society. It's a bit like asking people what's the best mix of materials to use when making a jumbo jet -- how on earth should they know?

Finally, I think this study would have been a lot more interesting if it had asked about income distributions rather than wealth distributions. Net worth misses a lot of important but off-balance sheet assets and liabilities that we hold. One is human capital -- a recent graduate of medical school is likely to have a negative net worth but is not "poor" by any reasonable definition. Another important asset is the expectation of receiving future government benefits, including Social Security and Medicare. If these factors are included, America's wealth distribution becomes significantly less skewed.

And except for very rich people, the income statement is a far better predictor of living standard than the balance sheet. Think about a middle-class family of four with annual expenses of about $60,000 after taxes. In determining whether the family could meet those costs, would you first ask about family assets or family income? Over the next year, most people will rely much more on human capital than on balance sheet wealth to support themselves, which makes balance sheet measures a weak indicator of need.

There is an important discussion to be had about income inequality and the desirable level of progressivity in government policies. But this paper, which points toward an outcome that could only be achieved with extremely undesirable policies, does little to inform that debate.

SOURCE

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ObamaCare blowback

By Jeff Jacoby

"WE HAVE to pass the bill so that you can find out what is in it", House Speaker Nancy Pelosi said last spring about her party’s 2,000-page health care overhaul. What she didn’t realize was that the more Americans find out about ObamaCare, the more they turn against it. Virtually from the day it was signed, a majority of Americans have favored repealing the massive law.

According to two polls released this past week — one a national survey by Rasmussen, the other a poll of key congressional districts for The Hill — they still do. So naturally congressional incumbents are touting their opposition to the health care law.

Representative Jason Altmire of Pennsylvania has a TV spot in which a woman says approvingly: “You saw him when he voted against health care.’’ Virginia congressman Glenn Nye plays up the way he “took on Congress . . . voting against the health care bill because it cost too much.’’ South Dakota’s Stephanie Herseth Sandlin makes the same point in a humorous commercial starring her 22-month-old toddler, Zachary. Ads with similar messages have been aired by US Representatives Frank Kratovil of Maryland, Walt Minnick of Idaho, and Bobby Bright of Alabama. Plenty of Republicans are playing up their vote against the unpopular law — but these are all Democrats who voted no.

It wasn’t supposed to be like this. “When people better understand the Affordable Care Act, they’ll understand, I think, that this isn’t something being done to them but is something that’s really going to be valuable to them,’’ President Obama insisted last month. “The debate in Washington is over.’’

The debate is anything but over. As health insurers are forced to raise premiums in order to cover the cost of the new benefits required under ObamaCare, Americans are finding out just how “affordable’’ the Affordable Care Act really is. In recent weeks, Aetna, Regence Blue Cross Blue Shield, and other carriers have announced rate increases, attributing at least part of the higher charges to the richer benefits mandated by the new law — such as the elimination of lifetime coverage limits, “free’’ immunization for children, and the elimination of co-pays for mammograms and other preventive care. Presidents can promise to bend the cost curve, but the laws of supply and demand do not bow to presidential promises: More health care coverage costs more money — money that sooner or later comes out of consumers’ pockets.

Insurers are not responding to the new law and its expensive new mandates solely by raising premiums. Some are dropping out of insurance markets altogether.

Late last month, Harvard Pilgrim Health Care announced that it will stop providing Medicare Advantage insurance policies at the end of the year, forcing 22,000 senior citizens in New England to find some other way to pay for health benefits those policies covered. Harvard Pilgrim’s hand was forced, a company spokesman said, by the “cuts in Medicare . . . being used to fund national health care reform.’’

Another insurer pulling the plug is the Principal Financial Group, an Iowa-based company that currently insures 840,000 customers. “The company’s decision reflected its assessment of its ability to compete in the environment created by the new law,’’ reported the New York Times. “More insurers are likely to follow Principal’s lead.’’

Principal is a relatively small insurer, but even insurance giants are walking away from some segments of the business. UnitedHealth, Wellpoint, and Humana will no longer write individual child-only insurance policies, thanks to the new law’s requirement that such plans must also cover children who are seriously ill. Insurance companies are not charitable foundations; they cannot stay in business by insuring the health of people who are at a 100 percent risk of getting sick. As The Washington Post explained, “the pool of children insured by child-only plans would rapidly skew toward those with expensive medical bills, either bankrupting the plans or forcing insurers to make up their losses by substantially increasing premiums for all customers.’’

Meanwhile, 30 major corporations are still able to offer low-cost health insurance to their employees only because they have received one-year waivers of the new rules from the Department of Health and Human Services. What happens when those waivers expire is anybody’s guess. But this much is clear: If the law with its expensive mandates remains on the books, millions of Americans are going to lose the health care plans they have now — plans the president repeatedly promised they could keep. Which is why just about the only Democrats campaigning on ObamaCare today are the ones who voted against it.

SOURCE

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There's a Reason Why They Call Him "Dick"

Ann Coulter

If the Bush administration ever treated terrorism suspects the way Connecticut Attorney General Richard Blumenthal treats law-abiding citizens and small businesses, even conservatives would have blanched.

This activist, interventionist Democrat -- like his identical, slightly less oily twin, Eliot Spitzer -- decided at age 5 he was going to be a U.S. senator and then the first Jewish president. And he doesn't care how many lives he has to destroy to get there.

Currently, Blumenthal is running for the U.S. Senate against Linda McMahon in Connecticut. He must be stopped.

Among Blumenthal's taxpayer-funded citizen-persecution projects was the one he waged against Gina Kolb, owner of Computer Plus Center in East Hartford. After selling $17.2 million worth of computers and servers to the state in 2001, Kolb found herself being sued by Blumenthal for $1.75 million for allegedly overcharging the state $500,000.

Publicity-whore Blumenthal sent out an accusatory press release about Kolb, saying: "No supplier should be permitted to shortchange or overcharge the state without severe consequences." Soon thereafter, Kolb was arrested at her home on seven first-degree larceny charges, courtesy of Connecticut's crazily hyperactive attorney general.

A court dismissed all charges against Kolb and her company in 2008. But not before this female businesswoman had her company completely shattered by the pathologically ambitious attorney general.

I'm sorry, I know you need to be on television every single day, Dick, but that's not enough of a reason to destroy innocent citizens' lives, much less use taxpayer money to do so.

Kolb was far from the only innocent citizen persecuted by Blumenthal. The reason we know her story is that, instead of moving as far away from Connecticut as she could, Kolb turned around and sued the state for violating her constitutional rights.

The jury agreed, awarding her $18 million for Blumenthal's "pattern of conduct" that destroyed Kolb's business and impugned her integrity.

More HERE

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ELSEWHERE

Barack Obama and the Chamber of Secrets: "So, who’s left to demonize? The Girl Scouts? Rotary Clubs maybe? We’re running out of devils to distract us. Then again, the Obama administration’s preposterous attack on the U.S. Chamber of Commerce does nothing to help Democrats and everything to reinforce the moderate voter’s perception that the president’s party has gone bonkers.”

Distributism: More than a middle way: "Distributism is often misconstrued as a ‘third way’ between capitalism and socialism, taking the best of both but modulating their excesses. This is incorrect. As Medaille shows, distributism is not so much — indeed not at all — a ‘third way’ between different approaches but a different road entirely. This is in part because capitalism and socialism are not themselves separate ways. Marx and Hayek both contended, for example, that should their views be adopted, the state would wither away. Instead, under either communist regimes or capitalist economics, the growth of the state has increased, and with it has come increased reliance on centralized power and a crushing debt burden.”

Obama admin. expected to appeal “don’t ask, don’t tell” ruling: "The Obama administration is expected to appeal as soon as Wednesday a federal judge’s ruling that halted the Defense Department from enforcing its policy that bars openly gay people from military service, according to senior administration officials familiar with the government’s plans. … sources familiar with the government’s plans expect a motion for an emergency stay to halt the injunction to be filed first with [U.S. District Court Judge Virginia] Philips as a matter of procedure. If she rejects it, as expected, the request for an emergency stay would accompany the formal appeal to the Ninth Circuit Court.”

My Twitter.com identity: jonjayray. My Facebook page is also accessible as jonjayray (In full: http://www.facebook.com/jonjayray). For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena

List of backup or "mirror" sites here or here -- for readers in China or for everyone 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 Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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Look Who's Nativist Now

Democrat racism

Michelle Malkin

Oh, this is side-splitting: After exporting U.S. jobs, importing foreign debt and kowtowing to global thugs shamelessly over the past two years, the Obama administration is now playing the America First card. Democrats deserve a Guinness World Record award for their election-season cognitive dissonance.

President Barack Obama, Vice President Joe Biden, White House senior adviser David Axelrod and their mynah bird operatives across the country accused Republicans last week of benefiting from "money from foreign corporations" -- which liberals claim the U.S. Chamber of Commerce is funneling into domestic political ads.

Democratic clown prince Al Franken is leading a Senate inquisition against the chamber. A Democratic National Committee ad lambasted the GOP for "Stealing Democracy," complete with piles of Asian currency. Endangered Democratic candidates across the country are dutifully parroting the line of attack, which originated with the Center for American Progress, funded by far-left billionaire George Soros.

It's beyond comical to watch the party that cries "RAAAACISM" whenever conservatives question their shady foreign funny money suddenly sounding the alarm over non-U.S. campaign cash. And it's beyond galling to hear Democrats fret about foreign intrigue while the foreign agent-in-chief has inextricably tied America's fate to the Chinese holders of our T-bills. Guess we're all "nativists" now, eh, Obama?

The chamber-bashing claims are so baseless that The New York Times concluded that "there is little evidence that what the chamber does in collecting overseas dues is improper or even unusual, according to both liberal and conservative election-law lawyers and campaign finance documents."

Liberal CBS journalist Bob Schieffer scoffed at Axelrod: "If the only charge three weeks into the election that the Democrats can make is that somehow this may or may not be foreign money coming into the campaign, is that the best you can do?"

The Associated Press and the Annenberg Public Policy Center's Factcheck.org also shredded the White House smear, and Democrats told the Los Angeles Times they were uneasy with the McCarthyite tactics.

GOP candidates should remind voters of all the shady foreign and mystery cash the Democrats and their deep-pocketed donors have pumped into the political system.

Convicted fraudster and former top Democratic fundraiser Norman Hsu -- who ran several Hong Kong companies into the ground and built a massive Ponzi scheme with still-unidentified sources of income -- raised millions for the Democratic Party and its candidates, including Hillary Clinton and Obama.

Obama Commerce Secretary Gary Locke, a soft-on-China corporate lawyer, collected thousands of dollars from "monks" and "nuns" at a Buddhist temple while running for governor of Washington.

The Federal Election Commission imposed a record-setting $719,000 in fines against Democrats for the 1996 Chinagate campaign finance scandal.

And the Obama campaign itself solicited foreign donations on its website -- even cashing in a contribution from one Canadian donor who warned, "I am not a (sic) American citizen!"

Acknowledging the hypocrisy of the Team Obama assault on the Chamber of Commerce, one top Democratic staffer warned this week: "The White House may reap the whirlwind."

As well they should. While they gin up anti-GOP fear and hostility among blue-collar Americans worried about the economy, Team Obama has presided over job-killing policies that are driving companies overseas. The Obama drilling moratorium forced several American oil rigs to abandon the Gulf of Mexico. Radical environmental rules are strangling coal workers in West Virginia, where Democratic Senate candidate and Gov. Joe Manchin has filed suit against the Obama Environmental Protection Agency.

Wyoming GOP Sen. John Barrasso and Utah GOP Rep. Rob Bishop pointed out in a new report on the Democrats' War on Western Jobs that the White House green agenda is driving mining jobs overseas and increasing our reliance on foreign nations for metals and minerals that power our economy and are integral to national defense technology.

In another high dose of cognitive dissonance, Obama has been pushing solar panels and other green technology pet projects as a way to create jobs and promote energy independence -- while ignoring the fact that the rare earth metal market needed for such green technology is dominated by ... China. After years of environmental obstruction of the industry, Democrats are now rushing to re-open rare earth metal mines in the face of this national security threat. The last one shut down in 2002. It could take up to 15 years to get it back up and running again.

The inconvenient truth: American workers are reaping what the newly nativist left has sown.

SOURCE

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More Leftist authoritarianism: “I don’t want drivers talking on phones”

From the Nanny-in-Chief on down, Big Brother reigns in Washington as every department from Health and Human Services to EPA to Transportation seek ways to tighten their grip on American choice.

A day after a federal court judge in Detroit ruled that forcing Americans to buy health insurance is constitutional, transportation secretary Ray LaHood let it be known that Detroit auto manufacturers might have to abandon in-car connectivity systems that they have spent millions developing. Nanny LaHood, reports the Automotive News, “believes motorists are distracted by any use of mobile phones while driving, including hands-free calls.”

Not content to enforce existing distracted-driver laws, LaHood has been building a case for a non-permissive standard where drivers must be mute, two-hands-on-the-steering-wheel autobots.

“I don’t want people talking on phones, having them up to their ear or texting while they’re driving,” LaHood said this week calling for research on hands-free systems. Hands-free phone conversations are a “cognitive distraction,” he says. And eat your broccoli!

The potential restrictions have meant the auto industry has had to arm itself with more lobbyists to make their case for in-car communications systems. Ford’s SYNC and GM’s OnStar system, with about 5.7 million subscribers, are testing applications that would let users make audio updates to their Facebook pages and have messages from the social-media site read to them while driving. “I’m absolutely opposed to all of that,” said King LaHood.

What’s next? A ban on small children in cars? Tethers to force both hands on the wheel? No passengers in the front seat?

SOURCE

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Freer Is Better

John Stossel

The 2010 Index of Economic Freedom lowers the ranking of the United States to eighth out of 179 nations -- behind Canada! A year ago, it ranked sixth, ahead of Canada.

Don't say it's Barack Obama's fault. Half the data used in the index is from George W. Bush's final six months in office. This is a bipartisan problem.

For the past 16 years, the index has ranked the world's countries on the basis of their economic freedom -- or lack thereof. Ten criteria are used: freedoms related to business, trade, fiscal matters, monetary matters, investment, finance, labor, government spending, property rights and freedom from corruption.

The top 10 countries are: Hong Kong, Singapore, Australia, New Zealand, Ireland, Switzerland, Canada, the United States, Denmark and Chile.

The bottom 10: Republic of Congo, Solomon Islands, Turkmenistan, Democratic Republic of Congo, Libya, Venezuela, Burma, Eritrea, Cuba, Zimbabwe and North Korea.

The index demonstrates what we libertarians have long said: Economic freedom leads to prosperity. Also, the best places to live and fastest-growing economies are among the freest, and vice versa. A society will be materially well off to the extent its people have the liberty to acquire property, start businesses, and trade in a secure legal and political environment.

Bill Beach, director of the Heritage Foundation's Center for Data Analysis, which compiles the index with The Wall Street Journal, says the index defines "economic freedom" to mean: "You can follow your dreams, express yourself, create a business, do whatever job you want. Government doesn't run labor markets, or plan what business you can open, or over-regulate you."

We asked Beech about the U.S. ranking. "For first time in 16 years, the United States fell from the 'totally free' to 'mostly free' group. That's a terrible development," he said. He fears that if this continues, productive people will leave the United States for freer pastures.

"The United States has been this magnet for three centuries. But today money and people can move quickly, and in less than a lifetime a great country can go by the wayside."

Why is the United States falling behind? "Our spending has been excessive. ... We have the highest corporate tax rate in the world. (Government) takeovers of industries, subsidizing industries ... these are the kinds of moves that happen in Third World countries. ..."

Beach adds that the rule of law declined when the Obama administration declared some contracts to be null and void. For example, bondholders in the auto industry were forced to the back of the creditor line during bankruptcy. And there's more regulation of business, such as the Dodd-Frank law for the financial industry and the new credit-card law. But how could the United States place behind Canada? Isn't Canada practically a socialist country?

"Canada might do health care the wrong way," Beach said, "but by and large they do things the right way." Lately, Canada has lowered tax rates and reduced spending.

More HERE

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Earth to Obama

To be so completely disconnected from political reality and the investor class, the president must be from another planet

Larry Kudlow

Believe it or not, with jobs falling for four consecutive months and unemployment stubbornly high near 10 percent, President Obama is out on the campaign trail bashing businesses and promoting class warfare. Huh? Oh my gosh is he off message.

He’s slamming the Chamber of Commerce for allegedly using foreign money in campaign ads, even though there’s not one shred of evidence of this. Huh (again)? Is the Chamber really a big election-year issue? Is it causing high unemployment?

Of course, Obama never mentions the unions, including the SEIU and AFL-CIO, and all their foreign money from their big international affiliates. Instead, he extends his own cast of villains, attacking special interests, Wall Street banks, corporations, the oil industry, the insurance industry, credit-card companies, AIG, and ExxonMobil. ExxonMobil? What did they do? Oh, they’re an oil company. Phew. Kind of anti-business, wouldn’t you say?

Obama then blasts millionaires and billionaires, waging war on capital and investors, too. Next he talks about getting young people, African Americans, and union members to the polls. Even more division. Even more class warfare.

All this, of course, from the “post-partisan” president who was going to bring us all together for change.

But what’s truly incredible about Obama’s pre-election performance is how it totally misses the mark on the issues that really matter, like high unemployment, low growth, big-government spending, Obamacare, and tax hikes. That’s the stuff people are really talking about.

More HERE

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ELSEWHERE

Billets and bullets for the troops but not ballots?: "It’s utterly amazing that our nation’s leadership is able to send our troops around the world and overnight have sleeping quarters (known in military parlance as ‘billets’) constructed to house them. It is equally amazing that the required arms (bullets) can be shipped with equally profound efficiency and timely deliverance to any spot determined by that same leadership, anywhere in the world. And yet, the same leadership fails to deliver election ballots to the very people who defend the right to vote for every other American. Is that a failure in leadership? [It's just the usual Leftist crookedness. The military is overwhelmingly conservative so must be stopped from voting]

How do we know what we know?: "While traveling back to America at the end of World War II, Vonnegut asked a friend what he had learned from his wartime experiences: ‘never to believe anything my government tells me,’ the friend answered. Because the state is grounded in such a network of lies, contradictions, deceptions, and conflicts, it is safe to say that political systems are inherently in conflict with reality, and must resort to intentional distortions of truth as a way of trying to appear coherent to a gullible public.”

Yes, Paul Krugman thinks Obama is a “small spender”: "Paul Krugman wrote a head-scratching column Sunday titled, ‘Hey, Small Spender.’ In the column, Krugman not only argues that President Obama’s stimulus package was too small, but he even claims that Obama and his administration did not create a bigger government. He asserts that people think Obama is a big spender as a result of ‘a disinformation campaign from the right.’”

Work choices, money, and status: "As the time horizon gets long, the effects of monetary incentives and status motives may be hard to disentangle. In the short run, you raise marginal tax rates, and few people reduce work effort, because the status of being ‘employed’ is much higher than the status of being a homebody. However, once a few people decide to become homebodies, the status of being a homebody goes up enough that many people choose not to work. So the long run effect of the higher marginal tax rate is much higher than anything you might have predicted, because it has affected cultural norms.”

Tariffs benefit few, at cost to all: "Protectionism still flourishes — even in our deeply integrated global economy and even though economists almost unanimously find it short-sighted — because there is an asymmetry of information between stakeholders, which produces an asymmetry of motivations. Protection seekers have a reasonably good idea of the windfall to expect if their proposals are implemented. A steel tariff of 20 per cent, for example, might enable domestic producers, through higher prices and greater market share, to increase profits by an aggregate $100 million a year. However, the typically larger costs associated with a steel tariff are borne by a mostly unwitting public, whose incentives to lobby against the tariffs are muted by the fact that those large costs are spread across millions of consumers.”

My Twitter.com identity: jonjayray. My Facebook page is also accessible as jonjayray (In full: http://www.facebook.com/jonjayray). For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena

List of backup or "mirror" sites here or here -- for readers in China or for everyone 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 Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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Tuesday, October 12, 2010

Why so many of us resent the "elites"

by Peggy Noonan

If you write a column, you get a lot of e-mail. Sometimes, especially in a political season, it's possible to discern from it certain emerging themes – the comeback of old convictions, for instance, or the rise of new concerns. Let me tell you something I'm hearing, in different ways and different words. The coming rebellion in the voting booth is not only about the economic impact of spending, debt and deficits on America's future. It's also to some degree about the feared impact of all those things on the character of the American people. There is a real fear that government, with all its layers, its growth, its size, its imperviousness, is changing, or has changed, who we are. And that if we lose who we are, as Americans, we lose everything.

This is part of what's driving the sense of political urgency this year, especially within precincts of the Tea Party.

The most vivid illustration of the fear comes, actually, from another country, Greece, and is brilliantly limned by Michael Lewis in September's Vanity Fair. In "Beware Greeks Bearing Bonds," he outlines Greece's economic catastrophe. It is a bankrupt nation, its debt, or rather the amount of debt that has so far been unearthed and revealed, coming to "more than a quarter-million dollars for every working Greek." Over decades the Greeks turned their government "into a piƱata stuffed with fantastic sums" and gave "as many citizens as possible a whack at it." The average government job pays almost three times as much as the average private-sector job. The retirement age for "arduous" jobs, including hairdressers, radio announcers and musicians, is 55 for men and 50 for women. After that, a generous pension. The tax system has disintegrated. It is a welfare state with a cash economy.

Much of this is well known, though it is beautifully stated. But all of it, Mr. Lewis asserts, has badly damaged the Greek character. "It is simply assumed . . . that anyone who is working for the government is meant to be bribed. . . . Government officials are assumed to steal." Tax fraud is rampant. Everyone cheats. "It's become a cultural trait," a tax collector tells him.

Mr. Lewis: "The Greek state was not just corrupt but also corrupting. Once you saw how it worked you could understand a phenomenon which otherwise made no sense at all: the difficulty Greek people have saying a kind word about one another. ... Everyone is pretty sure everyone is cheating on his taxes, or bribing politicians, or taking bribes, or lying about the value of his real estate. And this total absence of faith in one another is self-reinforcing. The epidemic of lying and cheating and stealing makes any sort of civic life impossible."

Thus can great nations, great cultures, disintegrate, break into little pieces that no longer cohere into a whole.

And what I get from my mail is a kind of soft echo of this. America is not Greece and knows it's not Greece, but there is a growing sense – I should say fear – that the weighty, mighty, imposing American government itself, whether it meant to or not, has for years been contributing to American behaviors that are neither culturally helpful nor, as we now all say, sustainable: a growing sense of entitlement, of dependency, of resentment and distrust, and an increasing suspicion that everyone else is gaming the system. "I got mine, you get yours."

People, as we know, are imperfect. Governments, composed top to bottom of imperfect people wielding power, are very imperfect. There are, of course, a million examples, big and small, of how governments can damage the actual nature and character of the citizenry, and only because there was just a commercial on TV telling me to gamble will I mention the famous case of the state lotteries.

Give government the right to reap revenue from the public desire to gamble, and you'll soon have government doing something your humble local bookie never had the temerity to try: convince the people that gambling is a moral good. They promote it insistently on local television, undermining any remaining reserve among our citizens not to play the numbers, not to develop what can become an addiction. Our state government daily promotes what for 2,000 years was understood to be a vice. No bookie ever committed a crime that big.

Government not only can change the national character, it can bizarrely channel national energy. And this is another theme in my mailbox, the rebellion against what government increasingly forces us to become: a nation of accountants.

No matter what level of life in which you operate, you are likely overwhelmed by forms, by a blizzard of regulations, rules, new laws. This is not new, it's just always getting worse. Priests are forced to be accountants now, and army officers, and dentists. The single most onerous part of Obamacare is the tax change whereby spending $600 on goods or services will require a IRS 1099 form. Economists will tell you of the financial cost of this, but I would argue that Paperwork Nation is utterly at odds with the American character.

Because Americans weren't born to be accountants. It's not in our DNA! We're supposed to be building the Empire State Building. We were meant, to be romantic about it, and why not, to be a pioneer people, to push on, invent electricity, shoot the bear, bootleg the beer, write the novel, create, reform and modernize great industries. We weren't meant to be neat and tidy record keepers. We weren't meant to wear green eyeshades. We looked better in a coonskin cap!

There is, I think, a powerful rebellion against all this. It isn't a new rebellion – it was part of Goldwaterism, and Reaganism – but it's rising again.

For those who wonder why so many people have come to hate, or let me change it to profoundly dislike, "the elites," especially the political elite, here is one reason: It is because they have armies of accountants to do this work for them. Those in power institute the regulations and rules and then hire people to protect them from the burdens and demands of their legislation. There is no congressman passing tax law who doesn't have staffers in his office taking care of his own financial life and who will not, when he moves down the street into the lobbying firm, have an army of accountants to protect him there.

Washington is now to some degree the focus of the same sort of profound resentment that Hollywood liberals inspired when they really mattered, or seemed really powerful. For decades they made films that were not helpful to our culture or society, that were full of violence and sick imagery. But they often brought their own children up more or less protected from the effects of the culture they created. Private schools, nannies, therapists, tutors. They bought their way out of the cultural mayhem to which they'd contributed. Their children were fine. Yours were on their own.

This is part of why people dislike "the elites" and why "the elites," especially in Washington, must in turn be responsive, come awake, start to notice. People don't like it when they fear you are subtly, day by day, year by year, changing the personality and character of their nation. They think, "You are ruining our country and insulating yourselves from the ruin. We hate you." And this is understandable.

SOURCE

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The Wealth Inequality Mirage

While most Americans are concerned about the country's high unemployment rate, a few elitists seek to use it as a pretext for their leveling agenda. Whether the country is prosperous or struggling to climb out of recession, as now, they complain about an economic inequality that they exaggerate.

These "levelers" care more about equal outcomes than equal opportunity. They misunderstand the dynamic of the American economy. Their "remedies" would do more harm than good.

Chief among them is Robert Reich, Secretary of Labor for President Bill Clinton and now a professor at the University of California, Berkeley. A few days ago, in a radio interview on National Public Radio, he said this:

"Unless we understand the relationship between the extraordinary concentration of income and wealth we have in this country and the failure of the economy to rebound, we are going to be destined for many, many years of high unemployment, anemic job recoveries and then periods of booms and busts that may even dwarf what we just had."

Mr. Reich is wrong. He and other levelers exaggerate economic inequality, eagerly, because they rely on pretax income, which omits the 97% of federal income taxes paid by the top half of income earners and the many "transfer payments," such as food stamps, housing assistance, Medicaid and Medicare. This exaggerated portrait of inequality undergirds the present effort by the Democrats to raise income tax rates for people with taxable incomes of $209,000 a year on joint returns and $171,000 a year on single returns.

A more meaningful measure of inequality comes from an examination of spending. On Wednesday the Labor Department presented 2009 data on consumer spending, based on income quintiles, or fifths. This analysis shows that economic inequality has not increased, contrary to what the levelers contend.

Differences in per-person spending from the lowest income fifth to the highest are not dramatically different from 20 years ago. These measures of spending show less inequality than do measures of income.

These data are important because the mirage of expanding income inequality is being touted by some Democrats as an excuse for tax increases on upper-income people, and to justify to Americans a European-style social contract of higher government spending and taxes.

That's the main battle between Republicans and Democrats in the November 2 congressional election. Republicans want to keep current tax rates to encourage businesses to expand and hire workers. Democrats want to raise taxes for the top two brackets, and point to rising income inequality as justification.

The Democrats say they would use the additional tax revenue to shrink the budget deficit, but inevitably some of that additional revenue would be spent on programs that redistribute income.

The Labor Department data, which are published every year, track spending by income group. Spending is vital because it determines our current standard of living and our confidence in the future. It shows how much purchasing power Americans have. The usual pretax measures of income, on which most inequality studies are based, don't show how much purchasing power some Americans have because they omit other benefits, and so don't provide an accurate measure of purchasing power inequality.

Further, income quintiles have different demographic characteristics, so comparisons of quintiles can be misleading. In 2009, households in the lowest fifth had an average of 1.7 people, and in half these households there were no earners. The highest fifth, however, had 3.1 persons per household, with 2.0 earners.

Household size at the bottom has been shrinking faster than at the top, adding to a false perception of inequality. Over the past 20 years, the size of households in the bottom quintile has declined by 5.6% and the middle quintile by 3.8%, whereas the size of the top-quintile household has been unchanged. This is due not only to the increased longevity of today's seniors, but also to the higher numbers of divorced couples and single-parent households.

Calculating spending on a per-person basis (these are my calculations, from the official data) produces comparable measures. The average annual spending for a household in the lowest quintile was $21,611, or $12,712 per person. In contrast, the average spending for a household in the top quintile was $94,244, or $30,401 per person.

On a per person basis, the new Labor Department numbers show that in 2009 households in the top fifth of the income distribution spent 2.4 times the amount spent by the bottom quintile. That, Professor Reich might note, was about the same as 20 years ago. The top quintile spent 1.8 times what the middle quintile spent per person. And that ratio has not been increasing.

On a per person basis, those in the bottom group spent 2.8% less in real terms in 2009 than in 2008 due to the recession. In contrast, those in the top quintile spent 0.6% more, and those in the middle quintile spent 0.7% more.

But compared with 1989, the big winners are the lowest-income group, which spent 9.1% more per person in constant dollars. In contrast, the highest group spent 2.6% more, and the middle group increased its spending by 1.1%.

Income and spending do not tell the whole story about how well Americans are doing. A higher percentage of low-income Americans own their homes free of mortgage debt than do upper-income Americans. Twenty-six percent of households in the lowest income group and 31% in the next-to-lowest group owned their homes debt- free in 2009, compared to 27% in the middle quintile and 18% in the top quintile. There are more seniors in the lower two quintiles, and many have paid off their homes.

Tens of millions of Americans are unemployed, underemployed, or have given up looking for work. They and their families simply want a chance to work, a hope that tomorrow will bring better employment prospects than today. The two major political parties have diametrically opposed policy prescriptions to appeal to Americans in search of a better tomorrow.

The choice is clear. One party offers lower taxes and less regulation as a means to allow businesses to expand and hire new workers and to make it easier for more Americans to start their own businesses. The other party seeks to punish those who have a job and doubly punish those who employ them.

SOURCE

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Odds are on Supreme Court striking down healthcare reform

A top Republican said Friday that he expects the U.S. Supreme Court to strike down key parts of the new healthcare reform law as unconstitutional. Rep. Mike Pence (R-Ind.), the third-ranking House Republican, who serves as conference chairman, said he saw enough votes on the high court to strike a blow to President Obama's signature domestic initiative. "It's going to the Supreme Court, and the Supreme Court's going to decide whether or not the Constitution of the United States permits the government to order the American people to purchase goods or services, whether they want them or need them or not," Pence said Friday on WLS radio in Indiana.

The Indiana lawmaker, and potential 2012 presidential candidate, has been among the crowd of Republicans to question whether a central part of Democrats' healthcare reform bill is constitutional. The crux of their argument is that the individual mandate - the section of the law requiring individuals to have health insurance of some sort - violates the Constitution.

A federal judge in Michigan dismissed a major case on Thursday challenging the healthcare law's constitutionality on that grounding, though other lawsuits are still being litigated in other federal districts. If courts in different areas of the country end up issuing different rulings, it could heighten the chances that the Supreme Court would take the case.

If it gets to that point, Pence said, he could envision five of the court's member voting to rule the bill unconstitutional. "I rather like our chances when this thing gets to the U.S. Supreme Court," he said. "I think there could be a narrow majority on the court that recognizes that you cannot compel the American people to purchase health insurance just as a function of being an American citizen."

SOURCE

My Twitter.com identity: jonjayray. My Facebook page is also accessible as jonjayray (In full: http://www.facebook.com/jonjayray). For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena

List of backup or "mirror" sites here or here -- for readers in China or for everyone 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 Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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Obama's Huge New Tax that will hit everyone

Pity the poor entrepreneur and small business owner in America now getting socked, with the mother of all taxes, by a government that has become either hostile, or indifferent, to understanding what it takes to build a business, grow a company and hire more workers. I'm not talking about new fees, but about a much greater confiscatory tax, imposed without any real debate or consideration--the confiscation of time.

Nearly every Obama administration initiative demands new, more complicated reporting and compliance filings on small businesses and entrepreneurs that are already overburdened with a mish-mash of reporting requirements that suck away an entrepreneur's time and energy. 2008 compliance costs for a small business, according to a recent SBA Report, was approximately $10,000 per employee. But, the Obama Administration has added new, and far more onerous, reporting demands that are likely to treble those costs to $30,000 per employee. Facing such huge, and hidden, costs of compliance, is there any wonder small businesses are not hiring as they have in the past?

Consider, for example, one of the new reporting requirements contained in Section 9006 of the disastrous Obama healthcare bill which requires all small companies to file 1099s for any purchase over $600, to include anything from office supplies to electricity to independent contractors. As a result, small businesses may need to hire a full-time compliance officer that does nothing but file these new forms and reports.

But that is just the start. For example, Section 1512 of the Recovery Act (ARRA) requires that a report with a minimum of 12 data points be submitted quarterly for each Recovery Act project over $25,000. A separate report has to be submitted if the business worked as a subcontractor on any ARRA project. This report is separate from and in addition to the mandatory, contractual reports submitted monthly to the government contracting officer on each project and, separate from and in addition to, the quarterly program reviews provided for agency leaders. Of course, if the business performs ARRA work at the State level, many of those states have additional reporting requirements for businesses who are working on federally funded stimulus projects within the state.

Small business already struggles because the federal government's reporting requirements are a moving target. Businesses must track the unusually frequent changes in government-issued guidance regarding reporting requirements. For example, since issuing the first reporting requirements for ARRA in February 2009, these requirements have changed nine times in the past 19 months, in March 2009, April 2009, June 2009, September 2009, November 2009, December 2009, April 2010, May 2010 and most recently in September 2010.

Each "update" to the reporting requirements issued by OMB is followed by an ancillary memo issued within each federal agency by each agency's Chief Acquisition Officer.

Businesses, especially small businesses, may spend large segments of the workday tracking reporting requirement changes. Businesses must do this because a clerical error, which could be interpreted by the oversight community as fraud, carries severe penalties, and the burden of proof of innocence falls on the business.

Taxes take many forms. More damaging, than canceling the Bush tax cuts, more damaging than the changing definition of who is considered "rich", more disturbing than Obama Administration's complete lack of understand of what it takes to grow a business and an economy, is the fact that time is money, so the new, burdensome and intrusive reporting requirements demanded by Obama's flawed policies puts a tax burden of time on all businesses.

Under the guise of "accountability" and the lure of "transparency", the Obama Administration continues to bombard businesses with additional, ill-thought reporting requirements. Few legislators and few members of the Obama Administration have ever experienced first-hand, the struggles of entrepreneurship--what Jerry McGuire calls "an up-at-dawn, pride-swallowing siege," of trying to win a customer's business, be competitive and succeed. The Administration, clearly, does not understand or does not care about the true cost to business of their self-serving actions.

Peter Drucker, the management guru once said: "if you're meeting, you're not working". Perhaps the corollary is that when a business is "reporting", then they aren't really working either.

Make no mistake: well-reasoned reports aid in accountability and transparency and are essential to ensure that taxpayer dollars are spent wisely by the government. But this is not happening in the Obama Administration. The President Obama once promised he would not raise taxes on the middle class. Yet, fees, fines and mandatory purchases are "onerous, rigorous demands" which, according to Webster, qualify as taxes.

Obama has demanded the one commodity which is in limited supply, and which can never be reproduced once spent-time. Obama wastes our time--and that tax is the greatest of all.

SOURCE

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President Obama's Tax Piracy

By Peter Ferrara

Starting on January 1, 2011, President Obama's economic recovery policy will begin the implementation of comprehensive, across the board, tax rate increases for every major federal tax. The full breathtaking scope of those tax increases, and how they will harm every family in America, is discussed in my latest work, President Obama's Tax Piracy, published as part of Encounter's Broadside series. That series now includes 17 publications by such outstanding authors as Steve Moore on economic policy, John Bolton on national defense and American sovereignty, Betsy McCaughey on Obamacare, Michael Ledeen on Obama's betrayal of Israel, Michael Mukasey on terrorism, Roy Spencer on "global warming," and John Fund on Obama's election fraud, all in the tradition of Thomas Paine's Common Sense pamphlets.

Among the bonehead increases that beckon to shove the economy back into recession is a nearly 20% increase in the top two income tax rates, counting the phase-out of deductions and exemptions. The top capital gains tax rate is scheduled to soar by nearly 60%, counting the application of Obamacare's new 3.8% tax on investment income. The tax rate on dividends is scheduled to nearly triple, from 15% to 43.4%, counting the new Obamacare tax as well. The Obamacare legislation also increased the Medicare HI payroll tax rate by 62% for the nation's employers and investors. On our current course, the death tax will rise from the grave next year with a 55% top rate.

At least that was the plan. But the Democrat Congress left town without ever making good on candidate Obama's pledge to the American people in 2008 to avoid any tax increase on those making less than $250,000 a year, by extending all of the Bush tax cuts for everyone below that income level. That means under current law federal income taxes will now increase next year for virtually every American. The bottom income tax rate of 10% will soar by 50% to 15%, and every other income tax rate will rise by a similar amount. The child tax credit will be slashed by 50% from $1,000 per child to $500 per child. The marriage penalty will also rise from the grave to tax more heavily those who are married rather than those who are just living together.

A family of four earning $50,000 per year will pay more than $2,100 in higher taxes. A single mom earning $36,000 per year will pay over $1,100 more in taxes.
Married senior citizens earning $40,000 per year will pay more than $1,400 in higher taxes.

If you have been listening to President Obama's rhetoric, you would be thinking how could failing to extend the Bush tax cuts result in all these tax increases on everybody, since Bush supposedly cut taxes only for the rich. That is why you should not be listening to President Obama's misleading, manipulative, deceptive rhetoric.

Baghdad Bob Economics

In case you have forgotten Baghdad Bob, he was the Saddam Hussein propaganda minister who called a press conference just before American forces entered Baghdad in 1991 to announce that those forces had been massacred in the desert by Saddam's military machine. With Saddam gone, Baghdad Bob now has a new gig. He is in charge of economic and tax policy propaganda for the Democrat party.

You can see the results of his work on national television all of the time. Joy Reid, Keith Boykin, and Christian Weller show up to argue that cutting tax rates for employers and investors causes recessions and economic calamity, such as the financial crisis. Indeed, President Obama is saying the same thing all the time with his rhetoric about "the failed policies of the past" that "got us into this mess."

That's not even Keynesian economics. Rather than John Maynard Keynes, or even Karl Marx, that economic "logic" follows more in the tradition of Jim Jones, and the Jonestown school of economic policy. Joy Reid adds to this body of work her "argument" that increasing real savings and investment for retirement would only cause another bubble in the markets. Reid was voted Netroots Blogger of the Year, which shows how much deep trouble our country is in as long the people identifying themselves as Progressives are anywhere near the levers of government power.

I explain in my Broadside publication how President Obama has consistently followed exactly the opposite of every plank of Reaganomics. As a consequence, we can rightly expect that America will now suffer exactly the opposite results, unless those economic policies are quickly overturned by new Congressional majorities.

In 1983, President Reagan's third year, his tax rate cuts became fully effective, and real GDP zoomed upward over the first 4 quarters of recovery by 7.7%. That recovery flowered into a generation-long, 25-year economic boom, interrupted only by two short, shallow recessions, following President Bush's budget deal increasing tax rates in 1990, and the 9/11 terror attack in 2001.

Art Laffer and Steve Moore have rightly called this Reagan boom "the greatest period of wealth creation in the history of the planet." Indeed, more wealth was created in America during this 25 year boom, from 1983 to 2007, than in all the prior 200 years of American history, from George Washington to Jimmy Carter, combined. That is why Steve Forbes has rightly called it an "economic Golden Age."

The mirror image opposite of this economic performance would be the natural, logical result of following the mirror image opposite of Reagan's economic program, including the counterproductive incentive effects of Obama's comprehensive federal tax rate increases, the costs and burdens of Obama's reregulation hitting next year, and the continued drain of private sector resources due to President Obama's supposedly stimulative spending increases and deficits. Laffer explains:

[W]hen the U.S. economy comes to 2011, the train's going to come off the tracks.. The tax boundary that will occur on January 1, 2011 tells me that GDP growth in 2010 will be some 6% to 8% higher than GDP growth in 2011. A year on year decline from trend of some 6% to 8% in GDP growth would represent a larger collapse than occurred in 2008 and early 2009.

We see signs of that already even in this year's economy, which, again just the opposite of Reagan's performance, should be the peak economic year in President Obama's reign of error. Economic growth is in a tailspin, falling from 5% in the fourth quarter of 2009, to 3.7% in the first quarter this year, to 1.6% in the second quarter. Unemployment is rising again, with the economy continuing to lose jobs every month. The stock market has been long stalled, mired 30% below its record highs over 14000 in the Dow. This weak economy couldn't be a worse time to raise Federal tax rates across the board. With President Obama's current economic policies, the probability of a renewed, double-dip recession is over 100%.

More HERE

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Food Stamp Nation

Pat Buchanan

"The lessons of history ... show conclusively that continued dependence upon relief induces a spiritual and moral disintegration fundamentally destructive to the national fiber. To dole out relief in this way is to administer a narcotic, a subtle destroyer of the human spirit."

These searing words about Depression-era welfare are from Franklin Roosevelt's 1935 State of the Union Address. FDR feared this self-reliant people might come to depend permanently upon government for the necessities of their daily lives. Like narcotics, such a dependency would destroy the fiber and spirit of the nation.

What brings his words to mind is news that 41.8 million Americans are on food stamps, and the White House estimates 43 million will soon be getting food stamps every month. A seventh of the nation cannot even feed itself.

If you would chart America's decline, this program is a good place to begin. As a harbinger of the Great Society to come, in early 1964, a Food Stamp Act was signed into law by LBJ appropriating $75 million for 350,000 individuals in 40 counties and three U.S. cities.

Yet, no one was starving. There had been no starvation since Jamestown, with such exceptions as the Donner Party caught in the Sierra Nevada in the winter of 1846-47, who took to eating their dead.

The Food Stamp Act became law half a decade after J.K. Galbraith in his best-seller had declared 1950s America to be the world's great Affluent Society.

Yet, when Richard Nixon took office, 3 million Americans were receiving food stamps at a cost of $270 million. Then CBS ran a program featuring a premature baby near death, and told us it was an infant starving to death in rich America. The nation demanded action, and Nixon acted. By the time he left office in 1974, the food stamp program was feeding 16 million Americans at an annual cost of $4 billion.

Fast forward to 2009. The cost to taxpayers of the U.S. food stamp program hit $56 billion. The number of recipients and cost of the program exploded again last year.

Among the reasons is family disintegration. Forty percent of all children in America are now born out of wedlock. Among Hispanics, it is 51 percent. Among African-Americans, it is 71 percent. Food stamps are feeding children abandoned by their own fathers. Taxpayers are taking up the slack for America's deadbeat dads.

More HERE

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ELSEWHERE

Allow citizens to sell kidneys: "Every year thousands of people die because they are unable to secure a healthy kidney replacement in time and thousands more are relegated to years of costly dialysis. The waiting time to receive a kidney transplant is around five years. The shortage is due to the fact that patients can only receive donated kidneys, either from the deceased or an extremely rare and charitable living individual. Because it is a crime to voluntarily trade one's organ for another's money we have a constant under-supply of kidneys."

Bureaucracy gone wild: "Unelected federal bureaucrats are forcing New York City to spend $27 million to replace their street signs. Our bureaucratic overlords maintain that streets signs must contain both upper and lower case letters, instead of just capital letters! Do you feel grateful that you're being protected from upper case streets signs? This dictatorial mandate comes from the Federal Highway Administration, and applies to every community in America, not just New York City. But don't blame this outrage on the busy-body Democrats. This isn't an Obama directive. The rule was actually promulgated back in 2003 - during the Bush Administration."

There is a new lot of postings by Chris Brand just up -- on his usual vastly "incorrect" themes of race, genes, IQ etc. He is pretty cutting about Obama's Afghanistan/Pakistan policies.

My Twitter.com identity: jonjayray. My Facebook page is also accessible as jonjayray (In full: http://www.facebook.com/jonjayray). For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena

List of backup or "mirror" sites here or here -- for readers in China or for everyone 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)

****************************

The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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Monday, October 11, 2010

Yes, President Bush, America does miss you



Several months ago a huge billboard appeared near Wyoming, Minnesota, with a beaming photo of George W. Bush with the caption “Miss me yet?” The answer to that question is clearly yes, according to a new CNN/Opinion Research poll, which shows the former president staging a remarkable political recovery despite having largely disappeared from public life since leaving office:

"By 47 to 45 percent, Americans say Obama is a better president than George W. Bush. But that two point margin is down from a 23 point advantage one year ago."

“Democrats may want to think twice about bringing up former President George W. Bush’s name while campaigning this year,” says CNN Polling Director Keating Holland.

This has to be one of the most extraordinary political comebacks in decades. And as this week’s Washington Post/ABC News poll showed, nearly 25 percent of Democrats now believe “a return to Bush’s policies would be good,” a staggeringly high figure. As The Post reports:

"Obama and the Democrats have argued that if Republicans were to gain control of Congress, they would return to the policies of President George W. Bush. Two-thirds of Democrats share that view and say it would be bad for the country. But almost a quarter of Democrats say a GOP-led Congress would take the country in a new and better direction or say a return to Bush’s policies would be good."

The CNN poll is of course deeply humiliating for the White House, especially coming just three and a half weeks before the November mid-terms. George W. Bush’s resurgence is in large part due to mounting opposition to the Obama’s presidency’s left-wing agenda, but it is also spurred by Obama’s image as an out of touch, aloof and elitist president, divorced from economic and political reality on the ground.

A lot of Americans frankly miss the down-to-earth and significantly warmer leadership style promoted by President Bush, as well as his unfailing sense of optimism and heart-felt pride in America on the world stage. You certainly won’t ever find Bush apologising for his country or extending the hand of friendship to her enemies.

And when Bush’s memoir “Decision Points” is published on November 9th, I’m in no doubt it will storm The New York Times’ bestseller list riding a new wave of nostalgia for his time in office. George W. Bush is back in fashion with a vengeance, in marked contrast to his increasingly unpopular successor in the White House.

SOURCE

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Progressive Feudalism

By Thomas Lifson

The changes wrought on the American political economy by progressives have taken us in the unmistakable direction of feudalism. The morphological resemblance between the progressive version of America and the historic feudal regimes of Western Europe and Japan is obvious if one takes a few moments to consider the changes in the proper context.

Legal Equality

Feudalism assigned people to different classes based on birth and assigned different privileges and obligations to the classes. The noble classes were considered a different order of humanity from the commoners, and the two groups led separate lifestyles. In addition to huge economic disparities, the two groups had very different rights. If one was of noble birth in Japan, for instance, he could carry a sword. For commoners, unlawful possession of a sword was a capital crime.

In progressive America, two groups today have a parallel distinction. Birth, and birth alone,* determines whether one is a member of a designated victim class, entitled to preferences in college admissions, scholarships, and employment, factors which have a major formative influence on life prospects. Moreover, the ability to litigate as the victim of discrimination with the possibility of massive financial returns is enhanced. According to the testimony of two Department of Justice lawyers, membership in a designated victim class brings with it immunity from prosecution under Civil Rights statutes.

Personal Autonomy

Under feudalism, the ruling class had few limits on its power and regarded the commoner classes as under their tutelage, hopelessly incompetent to make important decisions on their own. Many spheres of life were devoid of personal autonomy. What one wore and where one worked was closely regulated, and in feudal England or France, one could discern whether a person was a peasant, a blacksmith, a merchant, or a noble instantaneously, merely by dress.

In contrast, the bourgeois revolution, which overthrew the European feudal order, gave birth to the radical Enlightenment notion that each person should be the master of his or her own destiny, fit to make the important decisions in life autonomously. What one wore or ate was up to the individual.

In progressive America, personal decisions such as what to eat are now regarded as the proper concern of our government masters. Foie gras was forbidden by the city of Chicago for two years, and if you want to have your restaurant food cooked in trans fats like butter, you ought to know that New York City has a say in the matter.

Common to the feudal and progressive regimes is a deep and abiding disdain for the classes needing regulation and guidance. It is not so much that they hate or despise the lesser beings over which they rule, as it is a sense of obligation to make the right decisions for them.

Sumptuary Laws

Feudal rulers reserved for themselves certain luxuries. In feudal Japan, silk was an extravagance reserved exclusively for the noble classes. Wealthy merchants sometimes purchased garments with silk linings but with humble cotton, wool, or linen outer surfaces, so as to enjoy the warmth and softness of silk while preserving their lives.

In progressive America, Nancy Pelosi regularly jets from Washington, D.C. to her home in San Francisco on a luxury Gulfstream private jet belonging to the Air Force when she isn't commandeering a larger C-32 executive transport, the military version of the Boeing 757. Meanwhile, corporate executives were forced to cancel orders for and sell executive jets during the financial crisis of 2008-9. While President Obama told corporations to not hold meetings in Las Vegas, federal agencies are free to have meetings there.

Guilds

Under feudalism, officially recognized guilds enjoyed monopolies and special privileges, and in return, they offered financial and other support to the ruling class. In progressive America, powerful labor unions are allowed to force people to pay them dues in order to work in certain companies and public organizations. In return, these unions channel vast amounts of money in campaign donations to ruling class politicians at election time.

Moreover, unions can be insulated from the market consequences of their actions, as in the UAW members whose health care pension costs drove GM and Chrysler bankrupt but whose lavish benefits were preserved at taxpayer expense. Money spent under the stimulus bill has been channeled mostly to union members.

Estates

In European feudalism, clergy enjoyed special status as both advisers to rulers and justifiers of ruling class power. They were even called the First Estate, for they interpreted God's law, usually in a manner which maintained that the kings ruled by divine right.

In progressive America, a comparable role is played by lawyers and the courts, which enjoy vast powers and can command wealth that would be the envy of any bishop or cardinal in feudal France. Many of our most important decisions in progressive America are now taken away from the people's representatives in legislative bodies and decided by courts, themselves comprising members of the legal class.

Taxation

Under feudal regimes, the rulers took as much as they could in taxes, up to the point where peasants began starving and tax revenues decreased. In progressive America, taxes have also trended in that direction.

The Bourgeoisie

Under feudalism, the bourgeois class were regarded as upstarts and a threat to the legitimate ruling class. They were despised, ridiculed, and regulated. In progressive America, President Obama sees profit as an optional feature of corporations, and the disdain, regulation, taxation, and liability which business owners must endure have never been worse. As with feudal rulers, the progressive ruling classes see the bourgeoisie as vulgar pretenders to their own exalted status and a threat to their own power.

Back to the Future?

If progressivism has its way, more and more of our lives will be regulated by government bureaucrats setting rules and regulations and licensing people to engage in even the most mundane tasks. It is quite accurate to say that the reforms won by the rising bourgeois class from the fifteenth to the twentieth centuries, limiting and then ending feudalism, are in full retreat in progressive America.

It is time to rename progressives "regressives," a change I first proposed several years ago.

SOURCE

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Shocking: Bigoted White Tea Party Woman Beats Petite Black Female Reporter

Doug Giles

I’m sorry, I got that wrong. Stupid me. I’m never going to make it in this business. It was actually a big black liberal woman who whaled on a petite white conservative female reporter last weekend.

Whew, thank God I corrected myself because we all know that if a hulking honky Tea Party mama with dragon nails had smacked down a svelte progressive black female reporter (and on film, no less) it would have caused a media firestorm that would have escalated into:

1. Daily front page coverage by the New York Times

2. Watts-like riots across the nation

3. Non-stop bit**ing from Al Sharpton

4. The end of the Tea Party as we know it

5. And a drunk Kanye would’ve surfaced on a quickly-cobbled, specious Hollywood telethon against racism sporting white Levolor shades and a red leather Michael Jackson jacket and somehow pin all this Tea Party violence on George W. Bush’s primal hatred for black people.

In case you missed it (and I’m sure you did) this past weekend it appears that liberal F-bomb droppin’ black women at “Unity” gatherings can beat the crap out of Caucasian girls without it making the evening news or hitting the blogosphere.

One Emily Miller, a senior editor for HumanEvents who previously served as the deputy press secretary at the State Department and also served as an associate producer at ABC News, got pummeled like a rebel stepchild on October 2nd by a black liberal chick at the “One Nation Working Together” (cough) rally in D.C.

Here’s Jason Mattera’s short synopsis of the violence that went down in D.C. at the ill-attended, union-stacked, Star Wars bar scene, jealous of Glenn Beck Socialist Soiree:

“The reporter, Emily Miller, who was videotaping Rep. Charlie Rangel (D-N.Y.) was first hit from behind while she was taping Rangel in front of the Lincoln Memorial. Miss Miller is heard on the video saying, ‘Please don’t hit me.’ The protester proceeds to yell at the reporter, ‘Well get out of the way! What do you think this is? A--hole.’ The activist was attempting to meet Rangel herself. Miss Miller continued videotaping the event, when suddenly the same unhinged protester lunged at her, hit her on the arm, and yelled, ‘Don’t take my picture.’”

Again, this is all on video … as in crystal clear video. And I’ve heard nada from the networks. Crickets folks … crickets.

Yep, not only did the progressives trash the Mall and show up with their socialist signs (of which we’re condemned if we mentioned that they’re socialist) but one of their own also went postal on an innocent reporter—and the Blame Stream Media ignores this little nugget. How weird.

SOURCE

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Heritage in Focus: Matt Spalding on American Exceptionalism

At an event in Florida last week, former Speaker of the Florida House of Representatives Marco Rubio told a crowd: "This race is not your traditional race. It is a referendum on our identity. This race forces us to answer a very simple question: Do we want our country to continue to be exceptional, or are we prepared for it to become just like everybody else?"

The debate on American exceptionalism has garnered widespread attention this season. It has been a Tea Party rallying cry and an object of liberals’ sneers. But what is American exceptionalism?

In this week’s Heritage in Focus podcast, Matthew Spalding explains that America is different because it is founded on self-evident principles proclaimed in the Declaration of Independence and secured in the Constitution. These principles include the rights to life, liberty and the pursuit of happiness, the right to free speech and freedom of religion. America still holds this beacon of liberty among the nations of the world, even as Progressives deride such a claim as chauvinistic – a complaint they are free to make thanks to America’s unrivalled speech protections (to receive regular updates on Heritage podcasts, visit us on iTunes or subscribe to our RSS feed).

As President Obama replaces his national security advisor, proposes new plans to overhaul the economy, and tackles the implementation of his new health care laws, he too will be faced with questions of what the American republic is made of, and what makes it unique, a leader among nations.

In Europe, national economies are crushing entitlement burdens. America now faces the choice between free markets and public sector-driven redistributionist policies.

In China this week, government censors will undoubtedly rip the pages out of newspapers celebrating the award of the Nobel Peace Prize to jailed dissident Liu Xiaobo. In America, the lively debate that fuels democracy is kept alive by freedom of speech for as long as its citizens recognize and protect that freedom.

And now, with rising threats from Iran, North Korea, and other enemies of democracy and freedom, President Obama should reflect on his own words, from his speech after accepting his Nobel Peace Prize in 2009:

"…the world must remember that it was not simply international institutions – not just treaties and declarations – that brought stability to a post-World War II world. Whatever mistakes we have made, the plain fact is this: the United States of America has helped underwrite global security for more than six decades with the blood of our citizens and the strength of our arms."

These are rousing words in defense of American exceptionalism on the international stage, words which President Obama has still failed to live up to, as The Heritage Foundation’s analysis of the Obama Doctrine shows. It is the spirit and defense of American exceptionalism that should animate voters and policymakers as our country enters a turbulent time of international conflict and domestic hardship.

SOURCE

My Twitter.com identity: jonjayray. My Facebook page is also accessible as jonjayray (In full: http://www.facebook.com/jonjayray). For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena

List of backup or "mirror" sites here or here -- for readers in China or for everyone 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 Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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Sunday, October 10, 2010

Conservative women making waves for the mid-terms

The pro-abortion EMILY's list does NOT have a lock on the female vote

Marsha Blackburn, a Republican congresswoman from Tennessee, throws cold water on EMILY's shrieks of horror. "Women voters are fired up for this year's election and will most definitely not be staying home on Nov. 2, and there are at least 146 good reasons for this. A record number of Republican women have sought federal office this year -- 129 GOP women in House races and 17 in Senate races. In 1994, another record-breaking year, 91 Republican women ran in the House and 13 in the Senate. How can EMILY's List say that the party is running women out when more and more women are running? This is the year of the strong conservative woman, but because those women are overwhelmingly pro-life, EMILY's List clearly doesn't see them as good enough."

Blackburn's colleague, Republican Cathy McMorris Rodgers of Washington state, adds: "The type of women we are running -- political outsiders who are moms, small-business women, women who up until recently never thought of running for office but were inspired to run because of the dangerous course President Obama and Speaker Pelosi are taking America -- are threatening to the liberal special-interest groups who believe that to be a woman you must be a liberal and that conservative women candidates ... must not only be defeated, but also branded as somehow anti-woman. This is absurd."

Billie Tucker, a tea-party organizer from Florida, has no patience with Schriock's attempt to hold onto governing power: "It's not the number of women in Congress Ms. Schriock is really worried about. It's the number of women with Nancy Pelosi's behaviors that she wants to keep there." Stacy Mott, president of Smart Girl Politics, adds: "The next Congress is going to get this country back on track because brave women have had enough of Speaker Pelosi and President Obama's pandering, condescension and broken promises."

All of these women are people that EMILY's List exists to drown out. But they're being heard loud and clear. As Marjorie Dannenfelser, president of the Susan B. Anthony List, the closest thing the pro-life movement has to an organized response to EMILY, says: "EMILY's List has only dominated women's politics for so long because it discourages female voter turnout of what they consider the 'wrong kind of woman.' That dominance is clearly on the wane."

This election season points to a reality that hurts EMILY's List at its core. There is "enormous consensus" on the issue of abortion, Knights of Columbus head Carl Anderson argues in his upcoming book, "Beyond a House Divided: The Moral Consensus Ignored by Washington, Wall Street, and the Media." Marist polling done for the Knights found that eight out of 10 Americans "favor restrictions that would limit abortion to the first three months of pregnancy at most." Additionally, he notes that "53 percent of Americans would limit abortion to cases of rape, incest, or to save the life of a mother -- or would not allow it at all. Among women, the number is even higher -- 55 percent."

In this election, EMILY's List is playing to less than a quarter of Americans, according to the Knights' polling (which is consistent with CNN and other polling): the minority that wants abortion available throughout a woman's pregnancy. Republicans, for the most part -- even consistently pro-life ones -- seem to be playing to the real consensus as described by Anderson, while being true to their principles. If we can all agree on some restrictions, how about we start with prohibiting all federal funding of abortion? That's a far cry from overturning Roe v. Wade, but it's a start. And, by the way -- contrary to the scare tactics of EMILY's List -- a House Speaker Boehner wouldn't have the power to overturn Roe v. Wade even if he wanted to.

People are fed up with alarmist fear-mongering, because they are genuinely concerned about the future of their country. They know who they are, and they know that fear doesn't build a nation. They know how to keep those who are supposed to represent them accountable. EMILY's List doesn't speak for me; it speaks for fewer Americans every day. I understand why EMILY's List and the people who support it are spooked, but this year, voters will not be tricked.

More HERE

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Epic "Feminist" Hypocrisy (again)

By Carol Platt Liebau

The day after he (or a member of his staff) is caught on tape calling Meg Whitman a whore, Jerry Brown has announced the endorsement of the National Organization of Women (NOW).

You know, it's fashionable in feminist circles to sit around bemoaning the fact that few young women want to identify themselves as feminists.

Wanna know why? This kind of hypocrisy is the reason why. It's OK with NOW, supposedly an organization devoted to the equal and respectful treatment of women for Jerry Brown to call his opponent -- an accomplished woman, and more importantly, any woman -- a "whore." It's OK with NOW for Bill Clinton to engage in sexual harassment of an intern in The White House, and possibly worse in his pre-presidential days. It's OK with NOW to allow Sarah Palin to be denigrated in the cheapest, lowest and most sexist ways.

NOW has nothing to do with women's rights, or the proper treatment of women. They are simply shills for abortion and big government. They ought to admit it and take the word "Women" out of their name, because they no more stand for "women" in general than President Obama stands for small government and low taxes.

Women -- and men -- are on to NOW's racket. That's why their endorsement means nothing. They're just political hacks. What young woman in her right mind would want to be associated with such cheap political opportunism?

SOURCE

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What public-sector unions have wrought

by Jeff Jacoby

ORGANIZED LABOR in the United States achieved a milestone in 2009 that once would have been unthinkable: for the first time, union members working in government jobs outnumbered those working in the private sector.

According to the Bureau of Labor Statistics (BLS), the number of unionized private employees fell last year to 7.4 million. That represented just 7.2 percent of the private-sector labor force, the lowest proportion in over a century. By contrast, union membership in the public sector topped 7.9 million, or 37.4 percent of all federal, state, and local government jobs. The share of government workers belonging to labor unions, in other words, is more than five times the unionized share of the private sector. Union membership in private industry peaked at 35.7 percent in 1953 and has dwindled ever since. In the public sector, unions surpassed that level years ago and show no sign of weakening.

The number of government employees at all levels surged from about 8.2 million in 1959 to 22.5 million in 2009. Historically, government work paid less than comparable employment in the private economy, but greater job security and good pensions compensated for the lower wages. No longer: now government workers tend to fare better than private-sector workers across the board—not only in job security and pensions but in wages and other benefits as well.

Supporters of government pension benefit increases routinely argue that public employees are underpaid compared to private-sector counterparts, so retirement benefits must be sweetened to compensate. However, recent surveys used by the City's [NYC] Department of Human Resources to benchmark compensation disclose that in nearly all job classifications the City pays more in wages and salaries than the other governmental agencies and more than most private-sector employers.

Nationwide, according to BLS data for 2009, state and local government employees were paid an average wage of $26.01 per hour, which was 34 percent higher than the average private-sector wage of $19.39 per hour. Even more lopsided was the public-sector advantage in fringe benefits, such as health and life insurance, paid vacations and sick leave, and—above all—retirement income.

With compensation so generous, it is not surprising that government employees are only one-third as likely to leave their jobs as workers in the private sector. The logical inference is drawn by Chris Edwards, a scholar at the Cato Institute: "[S]tate and local pay is higher than needed to attract qualified workers."

Yet when it comes to outearning Americans who labor in the private sector, state and local government employees are left in the dust by their counterparts at the federal level.

In 2008, the 1.9 million civilians employed by Uncle Sam were paid, on average, an annual salary of $79,197, according to the Commerce Department's Bureau of Economic Analysis. The average private employee earned just $49,935. The difference between them came to more than $29,000 -- a disparity that has more than doubled since 2000. Add benefits to the mix and the federal advantage is even more striking.

In its budget narrative for 2011, the Obama administration acknowledges the premium in federal compensation but attributes it to the specialized skills and greater education of federal workers:
The federal government hires lawyers to tackle corruption, security professionals to monitor our borders, doctors to care for our injured veterans, and world-class scientists to combat deadly diseases such as cancer. Because of these vital needs, the Federal Government hires a relatively highly educated workforce, resulting in higher average pay. In 2009, full-time, year-round federal civilian employees earned on average 21 percent more than workers in the private sector.

In a similar vein, when Scott Brown, the newly elected senator from Massachusetts, called in February for a federal hiring and salary freeze "because... federal employees are making twice as much as their private counterparts," he was promptly taken to task by the 150,000-member National Treasury Employees Union. "Comparing salaries of federal employees and private sector employees is not an apples-to--apples comparison," the union's president admonished Brown in a letter. "The only appropriate way to make a fair pay comparison is to compare similar jobs with one another."

A few weeks later, USA Today published just such a comparison. Analyzing the salaries (not including benefits) paid in the 216 occupations with direct equivalents in both the federal and private-sector labor markets, it found a government premium in more than eight out of 10 categories. Registered nurses in the government's employ, for example, were paid an average of $74,460 a year, while those in the private sector earned an average of $63,780. Among librarians, the federal pay advantage was $12,826; among graphic designers, $24,255; among pest-control workers, $14,995. Overall, the paper concluded, "the typical federal worker is paid 20 percent more than a private-sector worker in the same occupation."

Even when taxpayers fall on hard times, the good life goes on for public employees. During the first year and a half of the current "Great Recession," the number of federal workers with salaries of $100,000 and up increased 46 percent. At the Defense Department, the number of civilian employees making $150,000 or more quintupled from 1,868 to 10,100; at Justice, the increase was nearly sevenfold.

The devastation wrought by the worst recession in two generations has not been evenly distributed. Between January 2008 and June 2010, the American private sector lost roughly 8 million jobs. Over the same period, the public sector workforce grew by 590,000.

IT IS NOT by happenstance that the growth in public-sector union jobs—from a trivial share of overall union membership 50 years ago to a majority today—has coincided with so vast an expansion of government and of its employees' pay and perquisites. As FDR had foreseen, there are crucial differences between collective bargaining in the public and private sectors. Labor unions negotiating on behalf of government employees enjoy at least four potent advantages, which they long ago learned to exploit.....

In many states, strikes by public employees are prohibited, and disputes that cannot be settled through collective bargaining are resolved through mandatory binding arbitration instead. Far from promoting compromise, however, binding arbitration undermines it. Unions have every incentive to bargain to impasse and then insist on arbitration, since they know that an arbitrator will almost never award public employees less than the government's final offer. That makes binding arbitration a can't-lose proposition for the unions and a certain loser for the taxpayers.

As a state senator in 1969, Coleman Young authored Michigan's mandatory-arbitration law. As mayor of Detroit years later, he came to deeply regret it. "We know that compulsory arbitration has been a failure," Young told National Journal in 1981. "Slowly, inexorably, compulsory arbitration destroys sensible fiscal management" and has "caused more damage to the public service in Detroit than the strikes [it was] designed to prevent."

It didn't take unions long to figure out that their members' votes, and the political donations funded in part with their members' dues, would yield tremendous leverage at the bargaining table. Consequently, for many public-sector unions, politics became a core function.

Time magazine, reporting in 1973 that the American Federation of State, County, and Municipal Employees was "teach[ing] local unionists how to organize political rallies, telethons, and letter-writing campaigns," quoted AFSCME's president, Jerry Wurf: "We're political as hell." That attitude is reflected on the AFSCME website, which boasts that candidates "all across the country, at every level of government" have learned to "pay attention to AFSCME's political muscle." The union is blunt about its reliance on politics to achieve its collective-bargaining aims. "We elect our bosses, so we've got to elect politicians who support us and hold those politicians accountable," AFSCME says. "Our jobs, wages, and working conditions are directly linked to politics."

For an even blunter expression of political hardball as played by the public-sector unions, turn to YouTube and watch the video labeled "SEIU Threat." At a budget hearing in the California legislature in 2009, an official of the Service Employees International Union, the nation's fastest-growing union, was recorded telling lawmakers to give the union what it wanted—or else. "We helped get you into office, and we got a good memory," she says evenly. "Come November, if you don't back our program, we'll get you out of office."

SEIU's memory—not to mention its clout and deep pockets—was clearly appreciated by the Obama administration. SEIU spent $67 million to elect Barack Obama and other Democrats in 2008. In the first nine months following Obama's inauguration, union president Andrew Stern visited the White House 22 times—more than any other visitor. Several top SEIU officials were appointed to posts in the new administration, including Patrick Gaspard, who became the White House political director, and Craig Becker, who was named to the National Labor Relations Board. "SEIU is on the field, it's in the White House, it's in the administration," gloated Stern—with reason—in a video to his members.

The unions' power to "elect our bosses" has thus turned public-sector collective bargaining into a rigged game -- rigged in favor of a privileged government elite and against the private taxpayers who pay its bills.

PUBLIC-SECTOR UNIONS will fight tooth and nail against any effort to rein in their outsize benefits, and with their immense political clout, they will not be easily defeated. But neither will it be easy to ignore the widening gulf between the public-union aristocracy—with its recession-proof jobs, automatic raises, early retirement, and spectacular pensions—and the scores of millions of Americans working in the private sector, whose standard of living is being eroded by high taxes, profligate government, and a shaky economy. In states where public-sector unions are dominant, such as California and New York, politicians will increasingly find themselves pressed to choose between the unions and a restive, indignant public.

Much more HERE

My Twitter.com identity: jonjayray. My Facebook page is also accessible as jonjayray (In full: http://www.facebook.com/jonjayray). For more blog postings from me, see TONGUE-TIED, EDUCATION WATCH INTERNATIONAL, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS, IMMIGRATION WATCH INTERNATIONAL, EYE ON BRITAIN and Paralipomena

List of backup or "mirror" sites here or here -- for readers in China or for everyone 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)

****************************

The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialist) and the full name of Hitler's political party (translated) was "The National Socialist German Workers' Party" (In German: Nationalsozialistische Deutsche Arbeiterpartei)

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