Tag Archives: government

France and the US

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Guy Milliere has an interesting article on the French elections last Sunday and on the decline of a once proud nation (the article was written before the elections, but what he wrote remains valid today–RTWT).

Milliere decries the failure of France and sees its present strait as no better than the precipice, beginning with:

…among the 10 candidates in the first round [of the French presidential elections last month], three were Trotskyites advocating a Leninist revolution; a disciple of Lyndon La Rouche; a former Norwegian judge who appears to think she is an environmental Robespierre (Eva Joly); a populist from the extreme right (Marine Le Pen); a moderate who would find his place in the left wing of the American Democratic Party (François Bayrou); a Gaullist speaking as if it were still 1965 (Nicolas Dupont Aignan); a very « socialist » Socialist (François Hollande); and the outgoing President Nicolas Sarkozy, a Bonapartist who, in the UK, would be to the left of the Labour Party.

At least with a two-party system (and occasional third-party spoiler) like ours (or even a three-party system with occasional spoiler flashes in the pan, as in Great Britain), the fringe groups don’t have much post-election effect, beyond the spoiling aspect of turning an election from one main party to the other.

But Milliere continued:

…no candidate defended free-market principles;…all of the candidates harshly attacked the financial world, multinational corporations, and globalization;…of the two finalists, one[‘s]… program appears to have been written before the development of the Internet.

Now we get to the parallels.  President Obama’s hostility toward free market principles, and toward business generally and banks explicitly, are both manifest (his claims to the contrary even as he follows them with screeds against the fat cats notwithstanding) and rooted in (and unchanged from) the late ’60s and early ’70s radical “community organizing” of his mentors.

Milliere went on:

France’s problems date from long before the presidency of Nicolas Sarkozy.  [It is a] country where no budget has been balanced since 1974, and where public expenditures have risen continuously in recent decades to represent a crippling 56% of its gross domestic product….  It is a country whose public debt is growing far faster than the public debt of its main economic partners in Europe, and will hit 87% of GDP this year (actually 146%, if what France owes to the European Union is included).  It is a country where reports on the inevitable failure of pension systems were presented to successive governments for over 25 years without a decision being proposed or taken.  It is a country where the…number of people living in poverty is between eight and ten million out of a population of 65 million.  It is also a country where…two-thirds of all higher education diplomas are worthless on the labor market.  Graduates with Master’s degree become fast-food servers or cashiers in a supermarket—if a position is available.

So it is in the US.  Our current economic disaster has been years, and administrations, in the making: very few actually balanced (as opposed to accounting gimmick balancing) budgets and national debt exploding over the last three years.  We’ve been ignoring the impending failure of our entitlement programs for decades, even though the originally forecast date range of their bankruptcy has moved very little in all that time.  Nearly 45 million Americans are currently receiving food stamps, which is roughly the same 14% of our population as is Milliere’s Frenchmen living in poverty; although, according to the CBO report at the link, that number is 70% higher than it was in 2007, immediately before the housing bubble burst.  And we insist on loaning taxpayer monies to students who wish to degree in gender studies, women’s contemporary literary issues, or basket weaving instead of in the productive STEM skills that a burgeoning and technologically evolving economy needs for national survival.

It’s necessary to change course.  And that course change must be in the direction of smaller, limited government that leaves more of our money, and our responsibility, in our hands.

Or we’ll end up like France.

Defense and the Russians

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The Russian government has shown their fundamental view of the United States and of their relationship with us.

Russian President Dmitry Medvedev said last year that Russia will retaliate militarily if it does not reach an agreement with the United States and NATO on our missile defense shield.

At a daylong Missile Defense Conference that took place in Moscow last week, the Russians made explicit their threat against us.  General Nikolai Makarov, the Russian armed forces chief of staff said, referring to missile defense installations currently contemplated by us in eastern Europe,

A decision to use destructive force pre-emptively will be taken if the situation worsens[.]

Makarov extended the scope of Russia’s intended actions.  He displayed on a large-screen video system for the benefit of conference delegates from 50 countries, including the US and NATO, computer-generated imagery depicting the reach of the American radar and missile systems that are components of our missile defense shield.  Russian missiles were shown streaking toward the US before being intercepted.

But this overt aggressiveness is not a new position for the Russians.  They threatened nuclear attacks against Poland four years ago if we deployed components of a then current missile defense shield there and in the Czech Republic.  We quietly canceled those plans.  The Russians invaded Georgia over a manufactured pique and perpetrated a Sudetenland-like partition of that country while we stood meekly by.

A couple of questions arise.

Why would Russia be thinking about a nuclear attack against the US?

Why would Russia casually threaten us in front of the world?

Perhaps they sense timidity on the part of the US administration.  Certainly, in the face of these public threats against both our allies and our homeland, our own State Department Special Envoy for Strategic Stability and Missile Defense, Ellen Tauscher could only say that it was

pretty clear that this is a year in which we’re probably not going to achieve any sort of a breakthrough.

But this was the point President Obama was making a couple of weeks ago to Medvedev when Obama pleaded for more time on the defense question—he’d have more flexibility to give the Russians what they want after he’s no longer accountable to the American people.

So much for Reset.  In the face of such naked threats of war—of preemptive war—how can the US do anything at all other than to press ahead with the deployment of a missile defense shield, now including defense against the long-range ICBMs that Russia has shown with their little demonstration that they fully intend to use against us?  On what basis can the Obama administration seriously be talking about disarming us in the face of these overt threats?

Some Thoughts on Free Markets and Limits

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I was driving to the airport to pick someone up after a too-long absence the other day when the traffic load struck me (figuratively).  I was driving on a modern freeway with no impediments to traffic flow.  Adjacent to this was a frontage road with traffic lights.  Even though the traffic loads were the same on both roads, the traffic on the frontage road stayed bunched up and slow moving—neither the drivers who wanted to go faster nor the slower drivers were able to go as fast as they wished due to the limits imposed on everyone traffic by those lights.

On the freeway, however, the traffic quickly got strung out and widely spaced, as the faster drivers moved apace, and the slower drivers—moving faster than their brethren on the frontage road—moved at their preferred slower pace.

What has this to do with free markets, one might ask.  It’s those limits.  The traffic lights—the limits a government applies to a centrally managed economy that requires (limited) licenses to manufacture so as to not over produce, licenses to sell so as to avoid unsanctioned pricing, licenses to handle the manufacturing scraps, donations to the correct political cause, and “protection” for everyone—keep everyone bunched up and slow-moving.  Certainly, the speed range between the fast-movers and the slow-movers was much narrower than the speed range on the freeway, but everyone was moving much more slowly than we were on our freeway.

Of course, on closer inspection, the analogy breaks down, but that closer inspection, now that we have the overall picture from the analogy, demonstrates the power of the free market economy compared to one that’s controlled by government, one that has those “traffic lights.”  Within the context of this post, the individual actors on each of the two highways are largely unrelated to each other, with the cars on the traffic light-limited highway, for instance, connected only by the physical presence of a car in front that’s held up by a red light or that is a slower-moving car in the forced bunch and so is holding up all the cars behind it.

In a free market economy, though, all the players are inextricably intertwined.  Indeed, the fast-movers don’t merely facilitate the slow-movers’ ability to get along down the market road, these fast-movers actually help pull the slow-movers along—even though the speed range between economic fast-movers and slow-movers in the free market is wider than it is in the managed economy.

Take luxuries, for example.  Two come to mind: air conditioners and televisions.

Oh, wait; these aren’t luxuries anymore, and they haven’t been for decades.

When these things first came out, only the rich, the economic fast-mover, could afford an air conditioner in the window of his house or a TV in his house’s living room.  But in a free market, these fast-movers helped create the market for the air conditioner and the television.  Call it a status symbol—I’ve arrived—or a desire to be first on the block to have one, or any other reason, only the rich both could afford such things and were interested in acting on the desire.

Air conditioner and television producers, wanting to sell more into that nascent market, produced more, and so more were bought.  In the free market economy, others wanted a piece of that action, and they produced air conditioners and televisions.  Competition between the producers—which doesn’t exist in a managed economy—began driving prices down, which made these luxuries more affordable—which drew in more producers wanting a taste of the money, which drove prices down even more, and ultimately, nearly everyone could—and did—buy.  Today, most houses have central air, and of those that don’t, most have window air conditioners that cost as little as $100—an unheard of level of cheapness 50 years ago—and air conditioning comes standard in our cars.

Today, most houses have multiple televisions, and increasing numbers have 50″ and 60″ plasma or LCD televisions, technologies not even imagined in the ’50s when television sets first started to become widely affordable.  And our higher end (no longer strictly high end, even) cars now have DVD players, or streaming video, or both—again, technologies unheard of just a bit ago.

Moreover, it’s those fast-movers that do the hiring of those slow-movers, either directly into their own production facilities, or indirectly, by the market’s push to get more manufacturing online, into other production facilities that are newly built or expanding existing operations to support the burgeoning market for all those (ex-) luxury goods. The ripples spread, too.  Supporting functions grow: the transistor and chip manufacturers to support the circuits in all those televisions, for example.

All this because the economic fast-movers wanted a luxury good, and a free market, unlimited by government “guidance,” enabled those luxuries to become commodities.

Finally, one too-often overlooked result is that those relatively farther behind free market slow-movers are vastly better off than are their slow-moving counterparts in the managed economy.  And with the jobs created by that free market, they have excellent opportunities to move up their economic ladder.

Some Thoughts on Energy Policy

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The administration’s rap is that we only have 2% of the world’s oil reserves, and there’s that fossil fuel pollution problem, so we have to push green energy sources (which President Obama masquerades as an “all of the above” energy policy).

The good folks at the Institute for Energy Research have a different take on the matter.

The figure below is a graph showing American population growth, energy use, economic performance, and pollution (emissions) rate since 1970 (the vertical dotted line is simply a break in the time scale from 20-year increments to 2-year increments).  It’s interesting to note that energy consumption per capita has been remarkably constant over these last 40 years.  Meanwhile, our GDP has gone up sharply, so that our energy use per unit of GDP—per unit of economic performance—has gone down sharply as we produce and use our energy more efficiently.  Also over that same time frame, our pollution rate—per capita and per unit of GDP—has gone…down.

Now, what about those miniscule reserves?

The reality is that we have more combined oil, coal, and natural gas resources than any other country on the planet. We have enough energy resources to provide reliable and affordable energy for decades, even centuries to come. The only real question is whether we will have access to our abundant energy resources, not whether sufficient resources exist. … According to the Congressional Research Service, we have the most fossil fuel resources of any country on Earth, but most of these resources are off-limits due to federal policies.

Indeed,

  • The United States is home to the richest oil shale deposits in the world—estimates are there are about 1 trillion barrels of recoverable oil in U.S. oil shale deposits, nearly four times that of Saudi Arabia’s proved oil reserves.
  • The United States has 261 billion tons of coal in its proved coal reserves. These are the world’s largest coal reserves and over 27 percent of the world’s proved coal reserves.
  • The United States has 486 billion tons of coal in its demonstrated reserve base [measured quantity of [coal] which, based on the geological and engineering data supporting proved energy reserves, can be recovered with presently available technology at an economically viable cost], enough domestic coal to use for the next 485 years at current rates of consumption. These estimates do not include Alaska’s coal resources, which according to government estimates, are larger than those in the lower 48 states.
  • The federal government leases less than 3 percent of federal lands for oil and natural gas production—2.2 percent of federal offshore areas and less than 5.4 percent of federal onshore lands.

This graph shows one impact of government intervention in energy production.

Notice the price drops when government intervention is reduced.  On top of this, the Federal government leases less than 3% of its lands for oil and natural gas production—2.2% of Federal offshore areas and less than 5.4% of federal onshore lands.  Finally,

Total federal subsidies in fiscal year 2007 were $24.34 per megawatt hour for solar-generated electricity and $23.37 per megawatt hour for wind, compared with $1.59 for nuclear, $0.67 for hydroelectric power, $0.44 for conventional coal, and $0.25 for natural gas and petroleum liquids. In fiscal year 2010, the subsidies were even higher. For solar power, they were $775.64 per megawatt hour, for wind $56.29, for nuclear $3.14, for hydroelectric power $0.82, for coal $0.64 and for natural gas and petroleum liquids $0.64.

My energy policy? Pretty much akin to “Drill, Baby, Drill.”  And export the excess.  Push for more nuclear power plants.  Three Mile Island demonstrated that our safety systems work, even in extremis.  Encourage wind and solar farms, but not with those—or any—subsidies (eliminate those trifling subsidies for the other energy sources, too).  The free market will decide the economic viability of our sources of energy, and the free market is the only mechanism qualified to determine what is economically sound among the several energy sources.

 

h/t Power Line

This is Promising

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Fox News reported over the weekend some excellent news concerning the Mojave Desert Memorial Cross, also known as the WWI Mojave Desert War Memorial.

A veterans group can restore a memorial cross in the Mojave Desert under a court settlement that ends a decade-old legal battle….

The [National Park Service] will give up the acre of land [the hilltop area known as Sunrise Rock on which the cross had stood for decades before thieves stole it after losing a court battle to have it removed legally] in exchange for five acres of donated property elsewhere in the 1.6 million acre preserve….

Justice Anthony Kennedy, siding with the 5-4 majority, wrote that the cross evokes more than religion.  “It evokes thousands of small crosses in foreign fields marking the graves of Americans who fell in battles, battles whose tragedies are compounded if the fallen are forgotten[.]”

As part of the settlement,

[o]nce the swap is complete, the park service will fence the site, leaving entrances for visitors, and post signs noting that it is private land. A plaque will be placed on the rock noting that it is a memorial for US war veterans.

No small amount of credit goes to Liberty Institute, who fought the legal fight for so long, and to Henry Sandoz, who worked so hard and so long maintaining the cross—keeping a promise he’d made those decades ago to his dying friend, Riley Bembry, who had erected the original cross in 1934—and producing the replacement that will go up when this all comes to fruition.

It’s not time to celebrate, yet; the land swap isn’t completed, the cross hasn’t been emplaced, and in the event, we still need to be alert for a repetition of the theft that prolonged this case.