Tag Archives: politics

The Short and Sweet of It

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Government debt is ballooning globally, but this short post centers on US government debt.

Over the past two decades, governments went on a debt binge, fueled by low interest rates. Now that rates have risen, investors worry that Western governments aren’t willing to make politically difficult decisions to curb public spending….

Of particular interest to me is that this has gone on in extreme parallel (to coin a phrase) in the US. In the years (too many of them) following the Panic of 2008, the US Fed kept interest rates, via its benchmark rate setting artificially suppressed, holding them down almost all the way to zero. That fueled the borrowing, since payments on the debt were so cheap. (The heavily negative impact on fixed-income Americans holding, as their primary income source, corporate and government debt instruments was of no mind to the Fed or to the administrations then in power.)

Federal spending needs to come down, certainly, but that’s made harder to do (the primary impediment is political timidity) at the higher interest rates currently extant.

Therein lies the rub. The Fed’s benchmark rates currently are at, or a skosh below, the rates historically consistent with the Fed’s 2% target inflation rate. The current push to lower them even further, globally as well as here at home, is mistaken. That won’t reduce borrowing; it’ll only increase it, partly to roll existent debt and partly to “take advantage of” the lower rates to increase net borrowing.

No. It’s time for the Fed to be quiet and sit down, leaving its benchmark rates at their current level. The only thing for the Fed to say publicly about rates is to announce in clear, no uncertain terms—no Fed speak—that it’s going to sit down and be quiet, and leave its benchmark rates at their current levels. It’ll be costly and slow for existing debt to be paid down, but our economy will recover to even greater prosperity on the other side. The cost of not sitting tight at current levels will be even greater in the long run of burgeoning debt that ends up so great it cannot be repaid, except with inflation destroyed dollars.

John Maynard Keynes once said that in the long run, we’ll all be dead (so who cares, went his subtext). But our children and grandchildren will be living in today’s long run. We should care today.

Rights from Men, Not from God

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That’s the view of Virginia’s Progressive-Democrat Senator Tim Kaine.

The notion that rights don’t come from laws and don’t come from the government, but come from the Creator—that’s what the Iranian government believes. It’s a theocratic regime that bases its rule on Sharia law and targets Sunnis, Bahá’ís, Jews, Christians and other religious minorities. And they do it because they believe that they understand what natural rights are from their Creator. So the statement that our rights do not come from our laws or our governments is extremely troubling.

Kaine is deliberately distorting (because I don’t believe so intelligent a man doesn’t know better the logic he’s tacitly using) the situation: he claims that because others make similar claims, they must all be equally false. Analogies, as Kaine is using here, can be useful in clarifying phenomena, but they also can be useful, as Kaine is doing here, to obfuscate and to seem to disprove phenomena (without any capability to prove or disprove anything).

Kaine chooses to ignore the differences between a culture, one the one hand, in which its citizens believe fundamental rights come from our Creator and that government is subordinate to the sovereign people. In our culture, our laws are intended to defend and implement those fundamental rights, not to create them.

That’s in contrast with nations (not necessarily the cultures of those nations) whose governing men and women insist that government is sovereign and its people subordinate and whose governing men and women speak words of rights coming from God but who appoint themselves as God’s interpreter and then define those rights for themselves, adjusting them from time to time at need to maintain their power.

In Kaine’s view, our fundamental rights would come from men like Kaine, who Knows Better and would define our rights in accordance with his superior knowledge, and women like Kamala Harris, whose handed-down rights would be salads of words, or Nancy Pelosi, whose handed-down rights would be State Secrets, allowing us to know what is in them only after she chooses to publish them.

In Kaine’s world, too, “rights” would evolve as the men and women in power change over time, and that would evolve as the men and women in power change their minds over time while they’re in power. Because they are rights created by men and women, they cannot be fundamental, intrinsic in our being. They are merely political rights, politically granted and politically taken away as the men and women in power deem fit.

This is entirely consistent with the Progressive-Democratic Party’s goal of fundamentally transforming our nation (Barack Obama) and of fundamentally changing our economy (Joe Biden). This is the risk we face in 2026, 2028, and subsequent elections.

H/t ralflongwalker

A Misunderstanding

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This one, a Wall Street Journal editorial centered on a coerced unionization of ride share companies Uber and Lyft. The editors got their misunderstanding in early, via their lede:

California Governor Gavin Newsom on Friday announced a “deal” with ride-share companies Uber and Lyft that they couldn’t refuse. Democrats in Sacramento will reduce auto insurance coverage mandates that are driving runaway litigation in return for the companies letting drivers collectively bargain.

Yes, they could have refused the deal. The California government foisted onto them a supremely ugly choice, but it was no less a freely taken choice for all its ugliness. The companies’ managers were just too timid to resist, too timid to leave the State altogether, as their own powerful alternative to Sacramento’s demand.

There’s no reason for any business, not just Uber and Lyft, to suffer the politically imposed costs of operating in California. Nothing is stopping businesses from leaving other than the timidity of their managers.

I alluded to it just above: the cost of doing business in California isn’t just fiscal. It’s political, too, reducing as that cost does, a company’s ability to manage its own business affairs in accordance with its own free market imperatives.

Regulation vs Regulation

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In an article centered on a so-called balancing act by Big Oil in an environment in which the Trump Administration is rolling back a broad swath of climate regulations, the news writers had this:

The industry’s biggest trade groups have said they support effective and reasonable regulations. Nixing the programs, the lobbyists said, would create an impossible choice for the industry—ask the administration to reinstate some rules, or walk back its previous support for some regulations.

This is timidity writ large. If the trade groups and the managers of the groups’ constituent companies really think this, that, or those rules are good ideas, then they should self-regulate along those lines. There’s nothing to stop them; there’s nothing forcing them to render themselves dependent on government diktats.

Lobbyists have signaled to the EPA that creating a regulatory vacuum could invite new lawsuits.

The proper response to those lawsuits is to stop being so desperate to settle and to stop hiding behind Government apron strings. With the climate regulation roll back, there are fewer grounds on which to base a lawsuit, and the proper response to those remaining that are brought is to refuse to settle, push the pace on the trials, and burn the suers to the ground in open court. That’ll be expensive in the early stages, especially as they’re forced by activist district judges to go through the appeals process, but it will reduce long-term legal costs far more by obviating a large number of lawsuits in the aftermath of those early ones.

It’s past time for business managers, especially including those running energy producing businesses, to recall the nature of their management roles.

The central imperative of a management position in the United States is to manage a company in a way that satisfies the company’s owners. There is nothing in that imperative that requires a manager to manage his company in a way that satisfies the demands of Government beyond simply following law. Those managers who are that timid that they need to be told what to do by Government need to be replaced; they’re unfit for their management positions.

This is America. Business managers are free to act on their own initiative; they are not required to wait on Government.

Abandoning Proportional Retaliation

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Israel hit a Houthi leadership conference and succeeded in killing a dozen or more of the Houthis’ top leaders, including their “prime minister” and “foreign minister” while injuring several other attendees. In the Wall Street Journal article describing the attack and its implications, the news writers noted that

Until Thursday’s strike, Israeli retaliation for Houthi attacks had largely been limited to infrastructure like ports and power stations.

Then they quoted Oded Ailam, ex-Mossad official and currently of the Jerusalem Center for Security and Foreign Affairs:

Israel has abandoned the old formulas of proportional retaliation[.]

As it should. The old formulas had nothing to do with proportionality, for all that their users insisted so. Those old formulas centered on tit-for-tat responses, which did nothing to deter future attacks, but did succeed, very effectively, at running up casualties, especially civilian, on both sides as a result of repeated and escalating tit-for-tat exchanges of retaliations.

There’s nothing at all proportional in a strategy that increases casualty rates rather than reduces them.

True proportionality is much more than retaliating in the moment after an in-the-moment attack. Proportionality done correctly, which includes serious consideration of the morality of the response, takes a longer view and considers how a current retaliation would impact future attacks by an enemy and so impact the civilian casualties associated with those future attacks as aggregated to the damage done—civilian as well as military—by a proximate retaliation. A truly proportional retaliation would mitigate, if not preempt, those future attacks by being sufficiently heavy and not immorally tit-for-tat.