Speaker of the House Nancy Pelosi and House Majority Leader Steny Hoyer today published their latest surreal editorial claiming that town hall protesters, the vast majority of which are concerned seniors and others concerned about out-of-control government spending, are "un-American." Aren't these the same Democrats that, during the the Bush Administration, vocally exclaimed Thomas Jefferson's contention that "Dissent is the highest form of patriotism?"
I find this ironic when just this week, Kenneth Gladney, an African-American concerned with the spiraling national debt and surge in government intrusion into the private lives of Americans, was physically attacked and called racial slurs by "patriotic" members of the Service Employees International Union (SEIU) when he was handing out "Don't Tread On Me" flags and buttons at a town hall meeting held by his congressman, Representative Russ Carnahan. Yes, the SEIU; the largest union of "patriotic" dissenters during the last Republican administration.
What has this world come to when our national leaders seek to convince us that their obvious deceptions warrant more trust than our own common sense and good nature as Americans? Is this what President Obama meant when he said that liberal groups should "Punch back twice as hard?"
Monday, August 10, 2009
Wednesday, August 5, 2009
Why Does The AARP Support Dem's Reform?
If you have been paying attention to the national debate about socialized health care, you no doubt will have witnessed the oft repeated statement that President Obama makes that Americans should support his health care reform initiatives because the AARP, the American Association of Retired Persons, supports his plan. That got me thinking: Why would an organization that purports to represent seniors support a plan that would inevitably result in reduced access, rationed care, less medical innovation, and reduced quality of life for their members?
First and foremost, what we must understand is that the AARP is an interest group and a political organization more than anything else. Political interest groups exist to expand their power and influence, contrary to the notion that they exist to represent their members. The political reality is that if the Democrats' plan for single payer nationalized health care passes, all future elections will be fought, not over education, foreign policy, or social issues, but rather over funding levels for government health services. As far as the AARP is concerned, the level of funding will always be inadequate and it will be their self-appointed mission to increase government funding (aka, higher taxes). And as the most influential senior lobby group in Washington, all seniors will be dependent upon the AARP to secure that funding. More dependence leads to more dues, which leads to more power, which leads to more influence, which leads to more members, and so on.
The sad fact is that the AARP support for the Democrats' designs on our health care system has nothing to do with better access, lower costs, or better care for their members. In fact, the plans before congress right now will reduce health care access for seniors, increase costs, ration care, and destroy medical innovation in elderly-focused areas of innovation like Alzheimer's research.
Witness in this video how interested the AARP is in the sincere viewpoints of their members during a recent "listening tour":
The "Public Option", a deceitful program designed to destroy private health insurance in America, and tax increases to pay for it, must be stopped, and it must be stopped now. Once it is in place, there is no turning back. The American health care system, the pinnacle of life saving innovation and the envy of the world, will be destroyed forever.
Take action! Take action now!
First and foremost, what we must understand is that the AARP is an interest group and a political organization more than anything else. Political interest groups exist to expand their power and influence, contrary to the notion that they exist to represent their members. The political reality is that if the Democrats' plan for single payer nationalized health care passes, all future elections will be fought, not over education, foreign policy, or social issues, but rather over funding levels for government health services. As far as the AARP is concerned, the level of funding will always be inadequate and it will be their self-appointed mission to increase government funding (aka, higher taxes). And as the most influential senior lobby group in Washington, all seniors will be dependent upon the AARP to secure that funding. More dependence leads to more dues, which leads to more power, which leads to more influence, which leads to more members, and so on.
The sad fact is that the AARP support for the Democrats' designs on our health care system has nothing to do with better access, lower costs, or better care for their members. In fact, the plans before congress right now will reduce health care access for seniors, increase costs, ration care, and destroy medical innovation in elderly-focused areas of innovation like Alzheimer's research.
Witness in this video how interested the AARP is in the sincere viewpoints of their members during a recent "listening tour":
The "Public Option", a deceitful program designed to destroy private health insurance in America, and tax increases to pay for it, must be stopped, and it must be stopped now. Once it is in place, there is no turning back. The American health care system, the pinnacle of life saving innovation and the envy of the world, will be destroyed forever.
Take action! Take action now!
Friday, July 31, 2009
Is America Waking Up?
A new poll released July 30th conducted by the Wall Street Journal/NBC News, indicates Republicans have made major gains against the Democratic Party with voters in virtually every policy area, erasing major gains made by Democrats during the Bush Administration. See the full results here.
It will be interesting to see if the Republican Party can keep up the momentum. Does anyone think this might have anything to do with Democrats' designs on the government takeover of our health care system?
It will be interesting to see if the Republican Party can keep up the momentum. Does anyone think this might have anything to do with Democrats' designs on the government takeover of our health care system?
Sunday, July 26, 2009
Real Clarity on Global Warming Consequences
As the debate about the science and politics of global warming rages on, even gracing the pages of this humble blog from time to time, the most important outcome from the debate is a clear examination of the consequences of global warming policy.
Reasonable people with differing interests and values can come down on different sides of the debate around the science of global warming. After all, most of us are not scientist and we must make reasonable judgments about the science we see. We also know that scientists, global warming "experts," and business leaders are hardly disinterested participants in the debate. Ultimately, however, intellectually honest individuals confronted with a clear analysis of the ultimate consequences of climate change policies they and their adversaries advocate can come to only one conclusion: climate change policies are potentially more dangerous, deadly, and costly than climate change itself.
In this illuminating new documentary by Mario Lewis, "Policy Peril: Why Global Warming Policies Are More Dangerous Than Global Warming Itself," Mr. Lewis examines the unintended consequences of climate change policy.
Please take a few minutes of your time to view this film and share it with your friends. We don't have to solve the debate about the merits of global warming right now. We don't even have to agree. All of us must, however, in an intellectually honest way, examine the real consequences, in terms of life, liberty, health, and well-being of people around the world, of those policies currently proposed by congress and the White House to arrest global warming.
Seek clarity. Think. And act.
Reasonable people with differing interests and values can come down on different sides of the debate around the science of global warming. After all, most of us are not scientist and we must make reasonable judgments about the science we see. We also know that scientists, global warming "experts," and business leaders are hardly disinterested participants in the debate. Ultimately, however, intellectually honest individuals confronted with a clear analysis of the ultimate consequences of climate change policies they and their adversaries advocate can come to only one conclusion: climate change policies are potentially more dangerous, deadly, and costly than climate change itself.
In this illuminating new documentary by Mario Lewis, "Policy Peril: Why Global Warming Policies Are More Dangerous Than Global Warming Itself," Mr. Lewis examines the unintended consequences of climate change policy.
Please take a few minutes of your time to view this film and share it with your friends. We don't have to solve the debate about the merits of global warming right now. We don't even have to agree. All of us must, however, in an intellectually honest way, examine the real consequences, in terms of life, liberty, health, and well-being of people around the world, of those policies currently proposed by congress and the White House to arrest global warming.
Seek clarity. Think. And act.
Tuesday, July 21, 2009
What Does Real Health Care Reform Look Like?
Why is it that whenever politicians talk about reform, it always comes with the heavy hand of more government control? Such is the case with the current debate about health care reform despite the fact that government run health care systems the world over have been dismal failures in their efforts to control costs, and inevitably result in rationed care and long waiting lines.
But, what is the alternative to government control in health care? What does real health care reform look like? Well, one of the inherent advantages of the free market system is the constant stream of innovation and new ideas. And yes, this even applies in the area of health insurance.
What if I told you there was a company that has seen its health insurance costs remain flat over the last four years while health insurance premiums across the country have increased 38% and Medicare costs have skyrocketed? What if I also told you that this was accomplished without restricting employee access to health care, while at the same time leading to employee obesity and smoking rates over 30% below the national average? A sinister plot you say? Okay, what if I told you that the employees love it, it is completely voluntary, and participating employees save significant money out of their own pockets?
Well, Safeway, the supermarket chain, has implemented a number of significant health insurance innovations since 2005 with astounding results. Recently, Steven Burd, Safeway's CEO, wrote an article for the Wall Street Journal explaining their success and how it could be applied to the nation as a whole.
This, my friends, is real health care reform, and it is brought to courtesy of the free market.
This on the other hand is not real reform:
Its deception.
But, what is the alternative to government control in health care? What does real health care reform look like? Well, one of the inherent advantages of the free market system is the constant stream of innovation and new ideas. And yes, this even applies in the area of health insurance.
What if I told you there was a company that has seen its health insurance costs remain flat over the last four years while health insurance premiums across the country have increased 38% and Medicare costs have skyrocketed? What if I also told you that this was accomplished without restricting employee access to health care, while at the same time leading to employee obesity and smoking rates over 30% below the national average? A sinister plot you say? Okay, what if I told you that the employees love it, it is completely voluntary, and participating employees save significant money out of their own pockets?
Well, Safeway, the supermarket chain, has implemented a number of significant health insurance innovations since 2005 with astounding results. Recently, Steven Burd, Safeway's CEO, wrote an article for the Wall Street Journal explaining their success and how it could be applied to the nation as a whole.
This, my friends, is real health care reform, and it is brought to courtesy of the free market.
This on the other hand is not real reform:
Its deception.
Monday, July 20, 2009
Milton Friedman Interview = Absolutely Brilliant
Every once in a while there comes a person who addresses seemingly complex issues and problems with such clarity that it can only be described as absolute brilliance. So it is that I stumbled across the following interview, conducted in 1979, of Milton Friedman, Nobel Prize winner in economics, by none other than self-described liberal Phil Donahue. Here, Mr. Friedman addresses the issue of greed and virtue in the free market versus government. The conversation is no less relevant now than it was 30 years ago. Please, take a couple minutes and treat yourself.
Absolute clarity. Absolutely brilliant.
Absolute clarity. Absolutely brilliant.
Romney and Obama Tied in Latest Poll
In a new nationwide poll taken by Rasmussen Reports, if the 2012 presidential election were held today, President Obama and Mitt Romney would be tied at 45% to 45% among all voters. Also interesting, Romney polled ahead of Obama among Independent voters, 48% to 41%.
Friday, July 17, 2009
Free Us From "Reform"
The Obama push is on. That is, the effort to push through by any means necessary what is often described as health care "reform" but is actually the nationalization of your body. Under the guise of providing health insurance to the uninsured among us, the Democrats' health care plans will, in essence, result in government control of your health. How so? Well, if the government controls your health care, either through regulation or as the sole provider, you will be completely dependent upon the government for your health and survival. Need treatment for diabetes? Only if the government says so. Need bypass surgery due to a serious heart condition? Only if the government says so. Need that new biotechnology cancer medication to fight off the relapse of breast cancer? Only if the government says so. Your life and your health will be entirely dependent upon a disinterested government bureaucrat who will be weighing your life against the government budget.
In an effort to resist this push for socialized medicine, a grassroots effort has been formed to accumulate 1 million signatures on a petition to stop the Democrats' plans for a government takeover of health care. Please consider going to FreeOurHealthCareNow.com and sign the petition.
Be part of the effort to turn back this looming disaster.
In an effort to resist this push for socialized medicine, a grassroots effort has been formed to accumulate 1 million signatures on a petition to stop the Democrats' plans for a government takeover of health care. Please consider going to FreeOurHealthCareNow.com and sign the petition.
Be part of the effort to turn back this looming disaster.
Saturday, June 13, 2009
Clarity on Unemployment and Wealth
It has been quite a while since I have published on "See The Forest" and I regret that. The hiatus has not stopped me in my quest for clarity, however.
The other day while in deep thought about the predicament in which our country finds itself, I had one of those rare moments of clarity. My revelation: unemployment results from a loss of wealth. Conversely, a sustainable rise in employment can only be brought about by an increase in wealth.
The reasons for this are many and undeniable. The vast majority of jobs in the United States are created by entrepreneurs and small businesses. Small businesses have more limited access to credit relative to large businesses and thus are more dependent upon cash flow to finance ongoing operations and growth. Is is this growth that leads to gains in overall employment. During economic downturns or when taxes are raised, cash flows drop, forestalling growth and leading to decreases in employment.
Socialist/liberal political and economic theory denies this very simple principle that employment and wealth are related. As adherents to Keynesian economic theory, in economic downturns Democrats seek to combat unemployment through increased government hiring and government spending. Increased government spending, however, crowds out private sector investment, and requires higher taxes that reduce the very cash flows that are required to drive private sector employment.
The inevitable result of denying the principle that wealth and employment are linked is the failure of government policy.
How does all this relate to situation in which America finds itself now? Well, I believe that the Obama Adminstration's efforts to boost the economy by instituting massive government spending in the form of the stimulus program ($800 billion), combined with the enormous increase in spending required (to the tune of over $1.5 trillion) to enact health care legislation, will require massive tax increases, while at the same time increasing interest rates, destroying wealth and leading to high structural unemployment. Many of the President's economist say that the spending is necessary and will create jobs. Well, all one needs to do is witness the relative economic stagnation and high unemployment across Western Europe since these same economic policies were instituted in the last thirty years.
I venture to bet that, given a real choice between the growth in prosperity that America has seen over the last three decades compared to the way Europe has withered, America would once again choose prosperity, i.e., lower taxes and lower government spending. Let's hope we get that choice before it is too late.
The other day while in deep thought about the predicament in which our country finds itself, I had one of those rare moments of clarity. My revelation: unemployment results from a loss of wealth. Conversely, a sustainable rise in employment can only be brought about by an increase in wealth.
The reasons for this are many and undeniable. The vast majority of jobs in the United States are created by entrepreneurs and small businesses. Small businesses have more limited access to credit relative to large businesses and thus are more dependent upon cash flow to finance ongoing operations and growth. Is is this growth that leads to gains in overall employment. During economic downturns or when taxes are raised, cash flows drop, forestalling growth and leading to decreases in employment.
Socialist/liberal political and economic theory denies this very simple principle that employment and wealth are related. As adherents to Keynesian economic theory, in economic downturns Democrats seek to combat unemployment through increased government hiring and government spending. Increased government spending, however, crowds out private sector investment, and requires higher taxes that reduce the very cash flows that are required to drive private sector employment.
The inevitable result of denying the principle that wealth and employment are linked is the failure of government policy.
How does all this relate to situation in which America finds itself now? Well, I believe that the Obama Adminstration's efforts to boost the economy by instituting massive government spending in the form of the stimulus program ($800 billion), combined with the enormous increase in spending required (to the tune of over $1.5 trillion) to enact health care legislation, will require massive tax increases, while at the same time increasing interest rates, destroying wealth and leading to high structural unemployment. Many of the President's economist say that the spending is necessary and will create jobs. Well, all one needs to do is witness the relative economic stagnation and high unemployment across Western Europe since these same economic policies were instituted in the last thirty years.
I venture to bet that, given a real choice between the growth in prosperity that America has seen over the last three decades compared to the way Europe has withered, America would once again choose prosperity, i.e., lower taxes and lower government spending. Let's hope we get that choice before it is too late.
Tuesday, May 12, 2009
Obama Policies a Threat to Social Security
The numbers are so huge they can not be comprehended. The projected size of the annual deficit under the proposed budget of President Obama and the Democrat congress is so large that the American public can not grasp its immensity. As a result, Obama and the Democrats are not forced to justify its size, or even explain how it will ever be repaid. It has proved difficult for the Republicans to criticize that which the public can not understand. Over the course of the next four years, President Obama and the Democrats will double the national debt and triple the national debt in the next ten years. The Democrats, even under their overly optimistic financial projections, will borrow more money than the total accumulated debt of every administration in over 200 years!
The consequence of this debt will be devastating. The burned on our children, and our children's children, is immoral. The result will be the bankruptcy of the country or hyperinflation that will destroy the financial assets of all Americans.
Perhaps the only way to truly make Americans understand, or even care, is to explain that massive spending by President Obama and the Democrats in Congress will destroy the Social Security system. Social Security will go bankrupt. That Social Security check that you are expecting to get after turning 67 (or maybe 70) won't come. If you get any check at all, it won't be worth anything. You are on your own. Hope you saved something or invested well. Because if you were counting on Social Security, you will be destitute!
Wake up America. And Republicans, you had better start explaining to your voters what is in store for them if they don't turn out the Democrats at the next election and reverse course.
The consequence of this debt will be devastating. The burned on our children, and our children's children, is immoral. The result will be the bankruptcy of the country or hyperinflation that will destroy the financial assets of all Americans.
Perhaps the only way to truly make Americans understand, or even care, is to explain that massive spending by President Obama and the Democrats in Congress will destroy the Social Security system. Social Security will go bankrupt. That Social Security check that you are expecting to get after turning 67 (or maybe 70) won't come. If you get any check at all, it won't be worth anything. You are on your own. Hope you saved something or invested well. Because if you were counting on Social Security, you will be destitute!
Wake up America. And Republicans, you had better start explaining to your voters what is in store for them if they don't turn out the Democrats at the next election and reverse course.
Monday, February 2, 2009
New Storyline: Old Media Is Dead
I was shouting at the screen, infuriated that I couldn't enjoy the game without the unwelcome commentary of the maddening broadcasters. You see, I am passionate about college basketball and an avid fan of the Gonzaga Bulldogs. I had been looking forward to the game for weeks. St. Mary's and Gonzaga were meeting for the first time in conference play, both undefeated in the West Coast Conference, and both meeting for the first time in history as ranked opponents. The victor would take command of first place in the league and gain solid advantage in the race for to be regular season champion. St. Mary's was led by Patrick Mills, a great shooter who performed very well in the last Olympics for his native Australian national team. Gonzaga students camped out in frigid temperatures for days prior to the game to get a seat. This was a huge game.
As I sat down with my family to watch the game, broadcast by ESPN, we immediately knew what ESPN's storyline was going to be: Patrick Mills. For the next two hours, the name of the St. Mary's point guard was the sole topic of conversation. It was quite evident that the ESPN broadcasters had not done their homework because they would barely say a word about anybody else on the court. How many times could they repeat in one game that Patrick Mills had played admirably in the Olympics. How many times could they marvel about his shooting ability...or his leadership...or his speed...or his passing...or his shoe size. Had you been listening to the game and not watching you might have thought that Patrick Mills was playing one-on-one with...Patrick Mills. You would hardly know that Gonzaga won the game. And to make it all the more infuriating, Patrick Mills left the game with three minutes left in the first half due to injury and never returned to the game. And yet, he is all they talked about. It was one of the worst broadcast performances I have ever seen.
It got me wondering about the media in general. If the mainstream media has a storyline, how on earth could the other side of the story ever have a hope of breaking through? The Arab/Israeli conflict is a case in point. It is quite obvious that the storyline of the major media, led in print media by the New York Times and in broadcast media by ABC, CBS, NBC, CNN, and the BBC, is that the Palestinians are resisting an illegal occupation by the Israelis any way then can, and the Israelis use disproportionate force to repress and murder, indiscriminately, innocent Palestinians. Pictures of dead Palestinian women and children (made available by Hamas) regularly populate the front page of the Times and lead the evening news broadcasts. The story of terrorized innocent Israelis never make the news. Pictures of Palestinian militants deliberately launching rockets from civilian areas rarely make the news. You see, they don't conform to the mainstream media's storyline. Are mainstream media outlets really concerned with presenting a fair and balanced story in context? Obviously not. They are only interested in promoting their world view. In other words, they are only interested in broadcasting propaganda.
For this very reason, more and more Americans are turning away from mainstream media outlets and get their news and commentary from other cable news outlets, like Fox News, and the new media. While traditional media laments their waning influence and ability to filter the news for public consumption, I believe that the new media (internet news services, blogs, YouTube, etc.), absent the filter of the main stream media's liberal world view, is often the best source for untainted news and the broadest perspective.
Take, for example, this amazingly engaging video below posted on YouTube by a young teenage Israeli girl as she gives a perspective to the Arab/Israeli conflict that you will likely NEVER hear in the mainstream media:
Having rarely heard such a compelling and heartfelt testimony from the Israeli point of view, I feel absolutely cheated by traditional media. I do not share the mainstream media's liberal, anti-American, anti-Israel world view and am offended by their continuing overt attempts to form public opinion to conform to their ideology. For that reason, I look forward to the demise of opinion-makers like the New York Times as it continues to careen toward bankruptcy, a victim of the public's turn toward new media...and truth.
As I sat down with my family to watch the game, broadcast by ESPN, we immediately knew what ESPN's storyline was going to be: Patrick Mills. For the next two hours, the name of the St. Mary's point guard was the sole topic of conversation. It was quite evident that the ESPN broadcasters had not done their homework because they would barely say a word about anybody else on the court. How many times could they repeat in one game that Patrick Mills had played admirably in the Olympics. How many times could they marvel about his shooting ability...or his leadership...or his speed...or his passing...or his shoe size. Had you been listening to the game and not watching you might have thought that Patrick Mills was playing one-on-one with...Patrick Mills. You would hardly know that Gonzaga won the game. And to make it all the more infuriating, Patrick Mills left the game with three minutes left in the first half due to injury and never returned to the game. And yet, he is all they talked about. It was one of the worst broadcast performances I have ever seen.
It got me wondering about the media in general. If the mainstream media has a storyline, how on earth could the other side of the story ever have a hope of breaking through? The Arab/Israeli conflict is a case in point. It is quite obvious that the storyline of the major media, led in print media by the New York Times and in broadcast media by ABC, CBS, NBC, CNN, and the BBC, is that the Palestinians are resisting an illegal occupation by the Israelis any way then can, and the Israelis use disproportionate force to repress and murder, indiscriminately, innocent Palestinians. Pictures of dead Palestinian women and children (made available by Hamas) regularly populate the front page of the Times and lead the evening news broadcasts. The story of terrorized innocent Israelis never make the news. Pictures of Palestinian militants deliberately launching rockets from civilian areas rarely make the news. You see, they don't conform to the mainstream media's storyline. Are mainstream media outlets really concerned with presenting a fair and balanced story in context? Obviously not. They are only interested in promoting their world view. In other words, they are only interested in broadcasting propaganda.
For this very reason, more and more Americans are turning away from mainstream media outlets and get their news and commentary from other cable news outlets, like Fox News, and the new media. While traditional media laments their waning influence and ability to filter the news for public consumption, I believe that the new media (internet news services, blogs, YouTube, etc.), absent the filter of the main stream media's liberal world view, is often the best source for untainted news and the broadest perspective.
Take, for example, this amazingly engaging video below posted on YouTube by a young teenage Israeli girl as she gives a perspective to the Arab/Israeli conflict that you will likely NEVER hear in the mainstream media:
Having rarely heard such a compelling and heartfelt testimony from the Israeli point of view, I feel absolutely cheated by traditional media. I do not share the mainstream media's liberal, anti-American, anti-Israel world view and am offended by their continuing overt attempts to form public opinion to conform to their ideology. For that reason, I look forward to the demise of opinion-makers like the New York Times as it continues to careen toward bankruptcy, a victim of the public's turn toward new media...and truth.
Wednesday, January 28, 2009
Conservative in Hollywood: The New Cool?
In case you hadn't noticed the changes in media over the last election cycle, the internet has become the new and most prominent battleground in the war of ideas. As print newspapers continue their descent into the ash heap of irrelevance, conservatives have finally begun to realize that the future of our movement lies in mastering the power of the internet to distribute ideas and promote communication on issues political, social, and economic.
One who gets it is Andrew Breitbart and Big Hollywood. Big Hollywood is a great new site dedicated to conservative thought in media and supporting conservatives in the liberal dominated entertainment industry (yes, surprisingly, they do apparently exist - that's the point). I find it wonderfully entertaining and demonstrative of the liberal bubble in Hollywood.
Big Hollywood is also a source for information you will find great difficulty seeing anywhere else. For example: If you haven't see this before you have to check out this new video by Macho Sauce Productions called "The Pledge?" It is fantastic:
Macho Sauce Productions was founded by Alfonzo Rachel. Alfonzo, where have you been?! If this keep up, conservatives are well on their way to competing for attention in today's pop culture. Edgy. Funny. Satirical. Potent. Right on target.
Could conservative be the new cool in Hollywood? Well, that might be a stretch, but, I continue to dream.
One who gets it is Andrew Breitbart and Big Hollywood. Big Hollywood is a great new site dedicated to conservative thought in media and supporting conservatives in the liberal dominated entertainment industry (yes, surprisingly, they do apparently exist - that's the point). I find it wonderfully entertaining and demonstrative of the liberal bubble in Hollywood.
Big Hollywood is also a source for information you will find great difficulty seeing anywhere else. For example: If you haven't see this before you have to check out this new video by Macho Sauce Productions called "The Pledge?" It is fantastic:
Macho Sauce Productions was founded by Alfonzo Rachel. Alfonzo, where have you been?! If this keep up, conservatives are well on their way to competing for attention in today's pop culture. Edgy. Funny. Satirical. Potent. Right on target.
Could conservative be the new cool in Hollywood? Well, that might be a stretch, but, I continue to dream.
Tuesday, January 27, 2009
Stagflation Train Wreck
The Democrats in Congress, led by Nancy Pelosi and Harry Reid, are debating a stimulus bill that is, by definition, designed to stimulate the economy. This is pure Keynesian, demand side, economic theory: spend massive amounts of "government" money to stimulate demand in the private sector. The only problem is, however, that Keynesian economics never works and there is virtually nothing stimulative in the roughly $825 billion bill.
So, what is the probable outcome of passing a stimulus bill substantially similar to the one being debated right now? A bill that spends close to $1 trillion of taxpayer money, that we don't have and our children will have to pay for, that produces little growth? Just think about it: no growth and huge amounts of dollars pushed into inefficient government programs and projects? We have the makings of a massive stagflation train wreck! Think late 70's Jimmy Carter economic stagflation.
But how can we design a stimulus bill that promotes growth (government never creates growth), promotes job creation (government never creates jobs), and avoids stagflation? Well, quite simply you have to design the bill to address the problems in the economy. For example, we have a financial crisis that has led to a massive contraction of available credit. Any stimulus bill should therefore include measures to stabilize the balance sheets of the banks (get rid of mark-to-market accounting and institute mark-to-model accounting) and increase liquidity in the financial markets (zero capital gains rate for at least the next two years and double IRA and 401K contribution limits) (see December 9, 2008 post). It might also include measures to stabilize the housing market (reduce real estate transaction costs or provide house purchase tax credit). Measures to increase demand and promote productivity in the private sector (research and development tax credits, accelerated capital expense depreciation, and pass free-trade agreements) would also be a vital elements.
My point is you have to write a bill to take care of the real problems. Unfortunately, solving the problems with the economy comes a distant second to the interests of politicians who are more concerned with spending taxpayer money on their favorite pet projects so they can show up at a ribbon cutting ceremony or to pay back their favorite constituent interest groups. So keep in mind that the next time a politician says they are going to create jobs and grow the economy, they are either delusional because they think can (only the private sector creates jobs) or think you are stupid enough to believe them. Then do your own due diligence to see if the bill they are voting for actually promotes growth and long-term sustainable demand. Chances are, if the politician believes in Keynesian/New Deal economics, and most Democrats do, it won't do either. The current stimulus bill doesn't do either and will be an absolute train wreck and will lead to horrible consequences for our country.
So, what is the probable outcome of passing a stimulus bill substantially similar to the one being debated right now? A bill that spends close to $1 trillion of taxpayer money, that we don't have and our children will have to pay for, that produces little growth? Just think about it: no growth and huge amounts of dollars pushed into inefficient government programs and projects? We have the makings of a massive stagflation train wreck! Think late 70's Jimmy Carter economic stagflation.
But how can we design a stimulus bill that promotes growth (government never creates growth), promotes job creation (government never creates jobs), and avoids stagflation? Well, quite simply you have to design the bill to address the problems in the economy. For example, we have a financial crisis that has led to a massive contraction of available credit. Any stimulus bill should therefore include measures to stabilize the balance sheets of the banks (get rid of mark-to-market accounting and institute mark-to-model accounting) and increase liquidity in the financial markets (zero capital gains rate for at least the next two years and double IRA and 401K contribution limits) (see December 9, 2008 post). It might also include measures to stabilize the housing market (reduce real estate transaction costs or provide house purchase tax credit). Measures to increase demand and promote productivity in the private sector (research and development tax credits, accelerated capital expense depreciation, and pass free-trade agreements) would also be a vital elements.
My point is you have to write a bill to take care of the real problems. Unfortunately, solving the problems with the economy comes a distant second to the interests of politicians who are more concerned with spending taxpayer money on their favorite pet projects so they can show up at a ribbon cutting ceremony or to pay back their favorite constituent interest groups. So keep in mind that the next time a politician says they are going to create jobs and grow the economy, they are either delusional because they think can (only the private sector creates jobs) or think you are stupid enough to believe them. Then do your own due diligence to see if the bill they are voting for actually promotes growth and long-term sustainable demand. Chances are, if the politician believes in Keynesian/New Deal economics, and most Democrats do, it won't do either. The current stimulus bill doesn't do either and will be an absolute train wreck and will lead to horrible consequences for our country.
Sunday, January 18, 2009
Some Common Truths About Trees
1. Man-made global warming is a fraud. The focus on curbing carbon dioxide emissions is a complete waste of time and fortune. Concern for the environment is totally legitimate, however, the taxing of fossil fuels and regulation carbon emissions will serve only to take money out of our pockets and give it to the government and those they deem more deserving of our money. It will do nothing to curb climate change. It will do nothing to help the environment. It will condemn billions of the world's population to eternal poverty. The world's temperature has never followed changes in greenhouse gasses. There is no legitimate reason to think they will in the future. Everything you have been told about man-made global warming is a lie.
2. Government run health care is an inevitable failure. The government never runs anything more efficiently than the private sector. The only way governments save money on health care is by rationing care. The result is always reduced services, less innovation, longer waits, and less accountability. If you want to pay less for health care, join an HMO and accept less access to specialized medicines and someone else making health care decisions for you, or, better yet, start a Health Savings Account (HSA) and buy a high deductible health insurance policy which gives you responsibility for minor health related issues yet protects you from catastrophic losses. Isn't that what insurance is for after all? The reason why third party insurance is so expensive is because it is really health care financing.
3. The U.S. Constitution is the foundation of America's greatness. It established in word, for all to see, our country as one made of law, not of man, and governed for, by, and of the people. When we stray from that ideal, when we cease to become a country governed my law but rather by man, we endanger the very future of our country and the uniqueness of American experiment. I believe that America is worth preserving for future generations. So, how do we endanger the constitution? When we neglect to interpret the constitution according to the words and their original intent. Words mean what they say. When we decide to ignore what they say because their intent is inconvenient or counter to what we desire, we are saying that the words don't mean what they say and, therefore, the rights the constitution enshrines for us, given by God, do not exist.
For example, the Second Amendment of the Bill of Rights gives all able-bodied individuals (understood as the militia) the right to keep and bear arms. That right was enshrined because the Founding Fathers were supremely suspicious of the power and authority of the countries from which they came, countries governed by the rule of man. They also understood that it was possible for the government to cease to govern according to its own constitution. They, therefore, recognized in the bill of rights the natural right of individuals to keep and bear arms for their own protection and, if necessary, to hold the government accountable if it failed to govern constitutionally. The Second Amendment does not exist so hunters and sportsmen can keep a shotgun to hunt or shoot skeet!
Many people quite reasonably believe that individuals should not have the right to own handguns. That is a legitimate opinion to have. It is not legitimate, however, to simply "reinterpret" the constitution to say that individuals should not have that right because the founders could not have envisioned they way we live in this day and age. The constitution establishes the means to change through constitutional amendment and it is appropriately difficult to do. If you want to change the constitution, change it. But when we say that the constitution may be reinterpreted to reached a desired outcome, we are in effect saying that the words don't mean what they say. If that is the case then none of the words mean what they say, they are not natural rights given by God, and our rights do not exist.
2. Government run health care is an inevitable failure. The government never runs anything more efficiently than the private sector. The only way governments save money on health care is by rationing care. The result is always reduced services, less innovation, longer waits, and less accountability. If you want to pay less for health care, join an HMO and accept less access to specialized medicines and someone else making health care decisions for you, or, better yet, start a Health Savings Account (HSA) and buy a high deductible health insurance policy which gives you responsibility for minor health related issues yet protects you from catastrophic losses. Isn't that what insurance is for after all? The reason why third party insurance is so expensive is because it is really health care financing.
3. The U.S. Constitution is the foundation of America's greatness. It established in word, for all to see, our country as one made of law, not of man, and governed for, by, and of the people. When we stray from that ideal, when we cease to become a country governed my law but rather by man, we endanger the very future of our country and the uniqueness of American experiment. I believe that America is worth preserving for future generations. So, how do we endanger the constitution? When we neglect to interpret the constitution according to the words and their original intent. Words mean what they say. When we decide to ignore what they say because their intent is inconvenient or counter to what we desire, we are saying that the words don't mean what they say and, therefore, the rights the constitution enshrines for us, given by God, do not exist.
For example, the Second Amendment of the Bill of Rights gives all able-bodied individuals (understood as the militia) the right to keep and bear arms. That right was enshrined because the Founding Fathers were supremely suspicious of the power and authority of the countries from which they came, countries governed by the rule of man. They also understood that it was possible for the government to cease to govern according to its own constitution. They, therefore, recognized in the bill of rights the natural right of individuals to keep and bear arms for their own protection and, if necessary, to hold the government accountable if it failed to govern constitutionally. The Second Amendment does not exist so hunters and sportsmen can keep a shotgun to hunt or shoot skeet!
Many people quite reasonably believe that individuals should not have the right to own handguns. That is a legitimate opinion to have. It is not legitimate, however, to simply "reinterpret" the constitution to say that individuals should not have that right because the founders could not have envisioned they way we live in this day and age. The constitution establishes the means to change through constitutional amendment and it is appropriately difficult to do. If you want to change the constitution, change it. But when we say that the constitution may be reinterpreted to reached a desired outcome, we are in effect saying that the words don't mean what they say. If that is the case then none of the words mean what they say, they are not natural rights given by God, and our rights do not exist.
Thursday, January 8, 2009
Vaclav Klaus: A Profile In Courage
Vaclav Klaus, the President of the Czech Republic, is a man of great moral courage. Jailed by the communists for being an outspoken critic of the failed ideology, he spent many years in prison only to lead his country's break from the Soviet bloc and hasten the crumbling of the iron curtain. Because of his extraordinary leadership millions live in freedom. Yet, even as communism has diminished as a threat to the liberty of people the world over, it has been replaced by the voracious power-grab of those who wish to gain domination over the actions of others in the name of global climate change. Even as millions willingly forfeit their economic liberty to others in the name of saving the planet, Vaclav Klaus is one of the very few political leaders with the moral courage and integrity to voice his opposition to the myth of man-made global warming and the cult of environmentalism.
I encourage you to watch the following video:
I found it ironic that the BBC interrogator accused Vaclav Klaus of being arrogant. Who do you think came off as the arrogant one? So now it is arrogant to fight for freedom and liberty? It is arrogant to stand up to the ridicule and the contempt of the mainstream media and political power? It is arrogant to think outside the box? Mr. Klaus made a great point: Who is more arrogant than Al Gore and his demand that there is a scientific consensus that global warming is man-made (there isn't) and accelerating (it isn't), and all debate must stop?
I plan to post soon about the science that demonstrates that man-made global warming is a myth, but I thought this video was very illustrative of the political pressure the mainstream media, environmental socialists, and liberal politicians place on those that voice opposition to their new religion of environmentalism.
Climate change is the trees; more government control in the name of the environment is the forest.
I encourage you to watch the following video:
I found it ironic that the BBC interrogator accused Vaclav Klaus of being arrogant. Who do you think came off as the arrogant one? So now it is arrogant to fight for freedom and liberty? It is arrogant to stand up to the ridicule and the contempt of the mainstream media and political power? It is arrogant to think outside the box? Mr. Klaus made a great point: Who is more arrogant than Al Gore and his demand that there is a scientific consensus that global warming is man-made (there isn't) and accelerating (it isn't), and all debate must stop?
I plan to post soon about the science that demonstrates that man-made global warming is a myth, but I thought this video was very illustrative of the political pressure the mainstream media, environmental socialists, and liberal politicians place on those that voice opposition to their new religion of environmentalism.
Climate change is the trees; more government control in the name of the environment is the forest.
Monday, January 5, 2009
Buy and Hold: Alive and Well
I find it interesting that so many stories have been popping up in on television, the internet, and investing magazines proclaiming the death of "Buy and Hold" as investing strategy. It is perfectly understandable after the horrendous performance of virtually all world stock markets. I assure you, however, that properly understood and implemented, buy and hold remains a viable and productive investment strategy.
First of all, buy and hold doesn't work for all types of investment assets. It works perfectly well with broad market index mutual funds and exchange traded funds as well as well-diversified and well-managed stock and bond funds. It does not work well with cyclical stocks that pay little or no dividend. It works very well with fundamentally strong companies in non-cyclical or defensive industries that pay good dividends. In fact, it is exactly times like these that make buy and hold work so well with the right kinds of assets.
How can buy and hold work well when the market goes down? Reversion to the mean. Let's look at a simple example. Say you buy 100 shares of company XYZ at $20 per share for a total investment of $2000. Let's also say that XYZ pays a 5% annual dividend, or $0.25 per quarter per share. After three months let's say that XYZ has lost 25% of its value. That would leave you with 100 shares of XYZ at $15 per share plus $25 in dividends reinvested at $15 per share for a total of 101.67 shares. Now let's say that XYZ continues to slide to $10 per share in a severe market downturn, yet it remains a fundamentally strong company. After reinvesting the quarterly dividend you would now have 104.2 shares of XYZ at $10 per share for a total value of $1042. In the second half of the year the market starts to recover bringing shares of XYZ with it back to $15 per share. Now after reinvesting the quarterly dividend you would have 105.94 shares of XYZ for a total value of $1589.10. And now by the end of the year the market has regained its original level bringing XYZ with it back to $20 per share. After reinvesting the dividend you would have 107.26 shares of XYZ at $20 per share for a total value of $2145.29 for a total return of 7.3% in a market that went nowhere in 12 months. Had you not reinvested dividends the return would have simply been the 5% dividend. Had you invested in a stock paying no dividend your return would have been zero for 12 months.
If you know the stock is going to go down, why not just wait and invest at a lower price per share? Well, that makes complete sense, but who knew before the fact that the stock market was going to be down so much in 2008? In fact, if you know a stock is going to go down, why not just short it? Hey, simple! But you know it is not really that simple. I know of no major investment analyst or columnist that knew that world markets were going to perform as poorly as they did in the last year (aside from a few gold-bugs that have been predicting armageddon every year for the last 15 years - even a broken clock is right twice a day). How about if you were a trader and set stop-losses or bought puts, etc.? Who knows? Depends upon your level of expertise, skill, timing, and trading strategy, however, studies show that the vast majority of traders under perform that market averages.
The above example shows pretty clearly why not all stocks qualify as good candidates. Stocks that pay little or no dividend do not present the opportunity to profit from reinvesting at lower levels. Stocks of companies that are not fundamentally strong reduce the likelihood that they will at least perform as well as the market over the long term. Financially strong, market leading companies with strong competitive advantages and good management can actually use severe market downturns to gain market share from weak rivals and may in fact benefit over the long term. And well-managed, defensive/non-cyclical companies tend to outperform the market in severe downturns and present stock patterns with more of an upward bias compared to deep cyclical companies.
So, does this mean you should never invest in non-dividend paying companies? No, not at all. It just requires a slightly different strategy. For example, I own Cisco Systems (CSCO), the large networking equipment company. I realize that technology companies are cyclical, but I still consider them a growth industry compared to, say, chemical companies, like DuPont or Dow Chemical. CSCO pays no dividend but they are fundamentally very strong with billions in cash on their balance sheet. In severe market downturns CSCO tends to use their strength to acquire competitors and take market share by offering financing to customers while continuing to invest in research and development. In the last 12 months, CSCO is down from about $27 to about $17, with a 52 week low of $14.20. While I have not benefited from reinvestment of any dividend as CSCO doesn't pay one, I have used the drop in the share price to add to my position in the stock. When CSCO recovers, which I believe it inevitably will, I will participate in its recovery. Could a trader outperform me? Sure, its possible. But statistics say it is tough. A better strategy might be to use options, but that doesn't come without a cost.
Have you heard the expression, "Buy when there is blood in streets?" What that is basically saying is that you make money in investing in the stock market when the market is so bad that nobody want to own stocks. In other words, the best time to buy is when the conventional wisdom is to sell. Well, right now might be the time to sell the idea that "buy and hold is dead" and buy "buy and hold."
First of all, buy and hold doesn't work for all types of investment assets. It works perfectly well with broad market index mutual funds and exchange traded funds as well as well-diversified and well-managed stock and bond funds. It does not work well with cyclical stocks that pay little or no dividend. It works very well with fundamentally strong companies in non-cyclical or defensive industries that pay good dividends. In fact, it is exactly times like these that make buy and hold work so well with the right kinds of assets.
How can buy and hold work well when the market goes down? Reversion to the mean. Let's look at a simple example. Say you buy 100 shares of company XYZ at $20 per share for a total investment of $2000. Let's also say that XYZ pays a 5% annual dividend, or $0.25 per quarter per share. After three months let's say that XYZ has lost 25% of its value. That would leave you with 100 shares of XYZ at $15 per share plus $25 in dividends reinvested at $15 per share for a total of 101.67 shares. Now let's say that XYZ continues to slide to $10 per share in a severe market downturn, yet it remains a fundamentally strong company. After reinvesting the quarterly dividend you would now have 104.2 shares of XYZ at $10 per share for a total value of $1042. In the second half of the year the market starts to recover bringing shares of XYZ with it back to $15 per share. Now after reinvesting the quarterly dividend you would have 105.94 shares of XYZ for a total value of $1589.10. And now by the end of the year the market has regained its original level bringing XYZ with it back to $20 per share. After reinvesting the dividend you would have 107.26 shares of XYZ at $20 per share for a total value of $2145.29 for a total return of 7.3% in a market that went nowhere in 12 months. Had you not reinvested dividends the return would have simply been the 5% dividend. Had you invested in a stock paying no dividend your return would have been zero for 12 months.
If you know the stock is going to go down, why not just wait and invest at a lower price per share? Well, that makes complete sense, but who knew before the fact that the stock market was going to be down so much in 2008? In fact, if you know a stock is going to go down, why not just short it? Hey, simple! But you know it is not really that simple. I know of no major investment analyst or columnist that knew that world markets were going to perform as poorly as they did in the last year (aside from a few gold-bugs that have been predicting armageddon every year for the last 15 years - even a broken clock is right twice a day). How about if you were a trader and set stop-losses or bought puts, etc.? Who knows? Depends upon your level of expertise, skill, timing, and trading strategy, however, studies show that the vast majority of traders under perform that market averages.
The above example shows pretty clearly why not all stocks qualify as good candidates. Stocks that pay little or no dividend do not present the opportunity to profit from reinvesting at lower levels. Stocks of companies that are not fundamentally strong reduce the likelihood that they will at least perform as well as the market over the long term. Financially strong, market leading companies with strong competitive advantages and good management can actually use severe market downturns to gain market share from weak rivals and may in fact benefit over the long term. And well-managed, defensive/non-cyclical companies tend to outperform the market in severe downturns and present stock patterns with more of an upward bias compared to deep cyclical companies.
So, does this mean you should never invest in non-dividend paying companies? No, not at all. It just requires a slightly different strategy. For example, I own Cisco Systems (CSCO), the large networking equipment company. I realize that technology companies are cyclical, but I still consider them a growth industry compared to, say, chemical companies, like DuPont or Dow Chemical. CSCO pays no dividend but they are fundamentally very strong with billions in cash on their balance sheet. In severe market downturns CSCO tends to use their strength to acquire competitors and take market share by offering financing to customers while continuing to invest in research and development. In the last 12 months, CSCO is down from about $27 to about $17, with a 52 week low of $14.20. While I have not benefited from reinvestment of any dividend as CSCO doesn't pay one, I have used the drop in the share price to add to my position in the stock. When CSCO recovers, which I believe it inevitably will, I will participate in its recovery. Could a trader outperform me? Sure, its possible. But statistics say it is tough. A better strategy might be to use options, but that doesn't come without a cost.
Have you heard the expression, "Buy when there is blood in streets?" What that is basically saying is that you make money in investing in the stock market when the market is so bad that nobody want to own stocks. In other words, the best time to buy is when the conventional wisdom is to sell. Well, right now might be the time to sell the idea that "buy and hold is dead" and buy "buy and hold."
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