Monthly Archives: June 2012

Democrats Just Don’t Understand

Posted on by
Reply

President Obama said, at a campaign stop at the Franklin Institute in Philadelphia on the 12th of June,

They [voters] have pretty good instincts about what works and they’re not persuaded that an economy built on the notion that everybody here is on their own is somehow going to result in a stronger, more prosperous America.

It doesn’t get any clearer than this statement, which demonstrates an utter lack of understanding of what life is like without government intimately involved in it, without government ensuring that we’re not being too selfish to help each other out.  But with remarks like this, Democrats are only projecting their own selfishness onto the rest of us.

Americans as a whole donated over $300 billion to charity in 2009, for instance, the third year in a row we donated more than $300 billion in a single year.  In 2008, within these $300 billion, Gallup says that conservatives donated 3.5% to 4.5% of their incomes; liberals donated 1.25% to 1.5%.  Senator Joe Biden, who now considers it the patriotic thing to do to pay lots of taxes, donated 0.1% of his income in each of the years 2001-2004.  Last year, Vice President Biden bumped his giving to the lofty level of 1.5%.  It’s certainly true that Obama, and a fellow Progressive, President Bill Clinton, give significantly more, but these two are not typical Democrats, as those numbers above demonstrate.

Americans—conservative Americans, at any rate—do our duty, we help our fellows.  We don’t need government hands in our pockets to do that.  We need government hands out of our pockets so we can do that better.

Democrats assume all of America is like them.  Fortunately, we’re not.  Not by a long shot.

Lending in Europe

Posted on by
Reply

I don’t often take issue with The Wall Street Journal, but a recent column by David Wessel cries out for a response.  His column is a description of the potential for an unraveling of the euro zone and of the euro itself, and of what needs to be done to preserve them both.

Wessel notes that [emphasis mine]

Today, banks in one euro-zone country are reluctant to lend to banks in another for fear that they won’t get repaid.  Bank lending among euro-area banks at the end of 2011 was 60% below the 2008 peak.  Money is moving not through usual bank-to-bank channels but only through the European Central Bank.  The urge…has given way to a rush to “ring-fence” assets and liabilities within individual countries.

He notes further that

Banks and investors are increasingly unwilling to buy bonds of governments other than their own.  Stronger northern European banks are reluctant to lend to customers and governments in southern and Eastern Europe.

You bet—see that bit about not expecting to be repaid.  Surely, it is no surprise that one enterprise declines to do business with another, or with a government, that the first views as unreliable.  Such a decision is entirely reasonable—it’s how sound businesses stay sound, for their own good, for the good of their employees, for the good of their larger community.

Wessel then quotes an example offered by Philipp Hildebrand, a former Swiss central banker, in an effort to show the unfairness of the situation:

Consider two similar companies, one Austrian and one Italian, that produce the same thing and sell to customers in Tirol in Austria.  The difference: the Italian firm, through no fault of its own, has to pay six percentage points more to borrow money.  “It kills whatever effort you make on structural reform,” [Hildebrand] said.

This is certainly too bad for the Italian firm and for the Italian government’s effort at reform, but where is the unfairness of the advantage to the Austrian firm?  The Italian firm operates under a government whose policies work against that firm’s ability to honor its obligations.  Further, how does this obligate in any way the German or Dutch or Finnish—or Austrian—taxpayer?

Beyond Europe’s new bailout of Spanish banks, there is talk of strengthening the authority of a pan-European banking supervisor…and creating a pan-European deposit-insurance fund so Italian depositors won’t move euros from Italian banks to safer German ones.

But this is insane.  In the first place, why shouldn’t Spanish depositors, or Italian depositors, or…—taxpayers all—move their money to safer locations?  Why should the taxpayers in those safer locations be on the hook for making other nations’ debtors, including those governments, whole?  There’s a very good reason some banks are safer than others, some economies sounder than others.  Some took—and take—better care of their fiscal responsibilities.

Banks are hunkering down at home.  National regulators are acting to protect their banks from the rest of Europe.  Governments are rebuilding old walls to protect taxpayers from bailing out others’ banks.

Why should they not?  By what remotest stretch of imagination should a sound bank be required to lend to an unsound bank—see the bit above about repayment expectations?  Why should taxpayers of one nation be required to throw their own hard-earned money into the bottomless pit of the profligate—see the bit above about repayment expectations?

And if this means the breakup of the euro zone and its currency, well, I’ve written about that elsewhere.

Government Censorship

Posted on by
Reply

Readers know that I’m no fan of the NLMSM.  However, now we hear of a naked attempt to turn the press—that erstwhile bastion of freedom—into an arm of the Federal government, all at the behest of President Obama’s Labor Department.

Labor officials have put forward a plan to require reporters who analyze and write about economic data which Labor provides in its “lock up” room to use government—Labor—computers, software(!?), and Internet accesses so the government, they claim, can protect itself against potential security hacks.

I have some beachfront property in central New Mexico on offer for those who believe this claim.

This is nothing but the government’s attempt to dictate to the press what they will be permitted to see and what they will be permitted to say about what they will see.  Bloomberg News Executive Editor, Dan Moss, testifying before the House Oversight and Government Reform Committee, has the right of it:

This proposal threatens the First Amendment.  The government would literally open the reporters’ notebooks.

(As an aside, it’s interesting to note that the Senate’s Homeland Security and Governmental Affairs Committee isn’t conducting any hearings on the matter.)

Carl Fillichio, a Labor communications specialist, told committee Chairman Darrell Issa (R, CA) after Wednesday’s hearing that he, Fillichio, would provide “some flexibility” on a June 15 deadline for the plan’s implementation.  Notice that: a communications specialist, not a Labor official with actual authority, claims to be in a position to commit the Department.  Fillichio did then send an email to Bloomberg, The Washington Examiner, and others, saying in part

Per my commitment to Chairman Issa’s request, we are going to move the effective date on changes to the lock up[.]

Notice this, too: there’s no commitment by this underling—or by anyone in authority at Labor, or by anyone in Obama’s White House—to eliminate this plan; there’s only a “commitment” to move its effective date.

Fox News‘ headline in the linked article is naïve.  This isn’t a backing off.  This is just cynical delay and a weasel-wording of a pseudo-change made by a junior functionary.  This obfuscation is of a piece with the HHS contraceptive, sterilization, and abortifacients insurance coverage “compromise.”  The plan will go into effect essentially unchanged, unless there’s more outcry and more pressure put on our Congressmen to withdraw by legislation this plan’s attack on our freedom (which also will force Obama’s explicit veto).

Regulations and Foreign Law

Posted on by
Reply

The Fed wants to put our own banking system under the aegis of international banking regulators.  Not directly, but by requiring all American banks—including even our smallest institutions—to meet the capital requirements of Basel III.  Basel III is an international standards “agreement” carrying international bureaucrats’ view of what constitutes a bank’s capital adequacy; those bureaucrats’ view of proper stress testing of a bank; and those bureaucrats’ view of the adequacy of a bank’s liquidity, apart from its capital adequacy.

There’s more: the Fed intends to impose on each bank a 1%-2.5% surcharge on its (increased) capital—because the Fed has a better understanding of how the bank’s capital should be used than does the bank.

Aside from whether US businesses should be under the control of foreign quasi-governmental agencies—a meme this administration is increasingly embracing—smaller financial institutions will have trouble meeting the additional requirements.  This is apparent from the results, in market share and profit margin, of this sort of intervention.  Lenders with $1 billion or less in assets have seen their market share fall to the neighborhood of 10% from the 31% they held in the early ’90s, and smaller banks had a return on assets of 1.22% for the first quarter of this year, compared with 1.52% for those with more than $1 billion in assets, just from the existence of the Fed’s domestic regulatory requirements.  So much for too big to fail.  The Fed is busily instituting too small to survive.  (And as an aside, notice those profit margins.  So much for fat cat bankers.  Those are the margins of chain grocery stores.)

There’s yet more.  The Fed doesn’t want banks to rate their riskiness in any effective way.  It intends to  force banks to stop relying on credit ratings when looking at their own assets’ riskiness.  Instead, the risk classifications of another foreign entity, Organization for Economic Cooperation and Development, are to be used.  The OECD Knows Better.

Hmm….

How is this Not a Firing Offense?

Posted on by
Reply

The principal of Brooklyn’s Coney Island PS 90–the Edna Cohen School–Greta Hawkins, has cancelled her kindergarten’s scheduled performance of Lee Greenwood’s “Proud to be an American” at their moving-up ceremony.

Her excuses?

We don’t want to offend other cultures

and the lyrics are “too grown up” for five year olds.  The opening lines, the “too grown up” lines, are these:

If tomorrow all the things were gone,
I’d worked for all my life,
And I had to start again,
With just my children and my wife,
I’d thank my lucky stars,
To be livin’ here today.

But  a Justin Bieber song was “age appropriate” for these same five year olds, and they were allowed to sing this song in the their ceremony.  This song opens with

Are we an item?
Girl, quit playing.

And the President Obama approves of this.  His Department of Education agrees with Hawkins.

The lyrics are not age-appropriate.

I’d like to hear his definition of “age-appropriate,” since he thinks patriotic lines are not, but Bieber’s lines are, for these children.

And those offended cultures?  The school has a significant immigrant student population, and so the neighborhood has a significant immigrant parent population.  Those parents, many of whom are immigrants from Pakistan, Mexico, and Ecuador, to name a few, “love” the song, which used to be performed annually by the kindergartners.  When last year’s fifth graders—who seem to be old enough to handle both patriotism and Bieber on the same day—sang “Proud to be an American” at their year-end ceremony, the parents of those fifth-graders gave it a standing ovation.

Yet, even though the school does have its students recite the Pledge of Allegiance and sing a stanza or two of “God Bless America” each morning, kindergartners aren’t allowed to be patriotic at their year-end ceremony.

Because patriotism is an “age-appropriate” topic.  And American patriotism might offend other cultures.

Update:  Now Hawkins has decided to can the Bieber song, too.  She’s not reinstating “Proud to be an American,” though; patriotism remains offensive at her school.  Congressman Michael G. Grimm (R, NY), whose district includes Brooklyn and this school, had some thoughts on the matter.

I am outraged that NYC’s Department of Education is standing by the decision of PS 90’s principal to pull the song “Proud to be an American” from the upcoming kindergarten ceremony, for fear of offending other cultures.   The only thing offensive about any of this is the anti-American message being engrained in our youth.  We all should be proud to be American and we should never ever apologize for it!

And Lee Greenwald had this about Hawkins’ banning of his song:

I think [Hawkins is] confused between allegiance and worship.  I don’t think it’s a religious issue to salute the flag.  You always respect the flag.  That’s just simple for me.  A religion that says you can’t do that is out of place