Tag Archives: politics

Whose Divide?

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Gerald Seib, in his Wall Street Journal‘s Capital Journal, has an odd take on the political (personal?) divide moving through our nation.

From the moment he rode down the escalator at his eponymous Fifth Avenue skyscraper to announce his candidacy three years ago, President Donald Trump has divided Americans[]

goes his lede, and he proceeds from there.

Never mind that it was then-Majority Leader Nancy Pelosi (D, CA) who dismissed Tea Partiers as mere Astroturfers.

Never mind that it was the NLMSM that insulted Tea Partiers with the careful slur of being mere tea bagger.

Never mind that is was then-Congressman Emanuel Cleaver (D, MO) called Republicans terrorists for disagreeing with Congressional Progressive-Democrats on a bill.

Never mind that it was ex-President Barack Obama (D) who dismissed millions of Americans as mere bitter Bible-toting gun-clingers in flyover country and who insisted, while agreeing that he didn’t have all the facts, that police act stupidly.

Never mind that it was Presidential candidate Hillary Clinton (D) who dismissed millions of Americans as irredeemably deplorable racists, misogynists, homophobic, and Islamophobic.

Never mind that it’s the Left’s Antifa and BLM who routinely shout down and deny the right to speak to Americans with whom they disagree.

Never mind that it was the Left who, on Inauguration Day, didn’t just protest Donald Trump’s election and inauguration, they rioted and burned private businesses.

Trump’s comments often are personally demeaning, but they’re exactly that: personal.  Trump disparages, in uncommonly rude terms for a public office holder, other people, but he does it to individual persons.  He also only does so in response to a personal attack on him.  He doesn’t denigrate whole groups of Americans, and he doesn’t do it as the opening shot in a manufactured series of insults.

No, the divisions in our nation are long-standing and growing—and it’s the Progressive-Democrats and their Left base who are doing the dividing, and doing it with increasing zeal.

Auditors and Regulators

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American regulators regularly inspect American auditors—particularly the Big Four accounting firms, Ernst & Young, Deloitte & Touche, KPMG, and PricewaterhouseCoopers—in order to give confidence to investors and the market at large that the auditors are giving accurate and balanced reports on balanced and accurate audits of the companies they audit.

Inspecting the auditors in the People’s Republic of China is a different matter.

Big Four accounting firms use their Chinese and Hong Kong affiliates to do significant work on the yearly audits of dozens of US companies doing business in China, including Walmart, Pfizer, and 3M, according to regulatory disclosures the auditors recently made for the first time.

Those “affiliates” actually are separate entities, and the PRC won’t allow those auditors to be checked up on by our regulators.  That’s a problem, as The Wall Street Journal put it:

The arrangement could leave investors in some of the world’s largest multinationals feeling like they can’t have full confidence that the auditors who scrutinize the companies’ finances have themselves been fully vetted by US regulators. And the regulators have no way of knowing whether those companies’ tens of billions of dollars of Chinese business has been subjected to outside scrutiny to help prevent errors or fraud.

It’s not small potatoes, either.

Walmart, which has more than 400 stores in China, is primarily audited by the US arm of Ernst & Young, but Ernst & Young’s Chinese affiliate did 10% to 20% of the work on the company’s latest audit, according to an EY filing with regulators. Pfizer, which got 7% of 2017 revenue from China, is primarily audited by KPMGs US firm, but KPMG China did 5% to 10% of the work.

Obviously, the PRC’s block needs to be an item of “discussion” in trade talks between the US and the PRC.  In the interim, the regulators should think—hard—about requiring companies doing business in the PRC that are audited, at least in part, by PRC auditors to report the details of those PRC auditors’ audits.  That way investors and the market at large could have some idea, at least, of the quality of the books of those American companies’ PRC branches.

Censorship

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Mark Zuckerberg and his Facebook are moving to delete from Facebook postings items, which Zuckerberg is pleased to term “misinformation” or “false information” (and for which he’s been unable to provide a definition, coherent criteria, or a balanced set of “fact” checkers), that in addition to being somehow false incite violence.

Facebook will rely on local organizations of its choosing to decide whether specific posts contain false information and could lead to physical violence[.]

Because local sources in Sri Lanka or Malaysia, or Indonesia, are going to provide objective analyses—especially when the “incitement” is against the groups particularly hated in nations like those.

Sure.  I might know of some beachfront property north of Santa Fe that might be of interest, too.

No, this is just another excuse for Facebook to inflict censorship. Aside from the naked lack of objectivity inherent in the foregoing, the larger item is this.  Online posts, whether on Facebook, Twitter, random blogs, or news outlet Web sites, are not responsible for violence. The persons inflicting the violence are the ones responsible for the violence. Attempts to shift responsibility don’t alter that in the least. Zuckerberg knows this.

Auto Tariffs Revisited

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EU Trade Commissioner Cecilia Malmström says the EU will respond to any increase in US tariffs on imported autos and auto parts with its own tariffs on autos and parts imported from the US.

And,

The EU cannot offer a bilateral deal only on autos, Ms. Malmström said, to address Mr Trumps complaints about the 28-member bloc’s 10% car tariffs—which are quadruple the US rate.

Never mind that applying its own auto and auto parts tariffs to imports from the US is precisely such a bilateral action.

In the meantime, Malmström, along with the rest of EU governance, continue to studiously ignore an offer already on the table: no tariffs at all on auto and auto parts imports.

Get Rid of Fannie Mae and Freddie Mac?

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Fed Chairman Jerome Powell thinks it’s a good idea.

I think it is really important for the longer run that we get the housing finance system off the federal government’s balance sheet.  I think it is very important for the economy longer term.

Treasury Secretary Steven Mnuchin agrees.

I am determined that we have a fix to the GSEs and that we don’t leave them in conservatorship for the rest of time[.]

But this doesn’t go far enough.  It’s insufficient to kick these Government Sponsored Entities out of conservatorship.  Left as GSEs, they’d still be able to dip their fingers into our pocketbooks; Fannie Mae wants another $3.7 billion of our tax money already.

No.  These GSEs need to be released into the wild and left to stand or fall on their market merits in the economy.