Category Archives: Business

Business, Economics, Political Commentary

The Tsunami Approaches

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The coming deconstruction:

California once again leads the nation with a $26 billion budget deficit plus an unfunded pension obligation of $500 billion. Its current financial structure is clearly unsustainable. It has an operational structure that in ungovernable with often duplicative agencies, some collecting less in tax revenue than the agencies spend on collection. Wikipedia lists 500 existing public agencies for the State of California. California can no longer afford such a luxury. It must deconstruct these bloated inefficient government agencies, and rid itself of their chairman, staff, offices, cars, pensions and the overhead that such excess represents. A $26 billion dollar deficit is not something that can be corrected with a wage freeze or job furloughs. Bold leadership can lead California to deconstruct its 500 agencies down to 100 functional organizations. California is a classic example of what must change in the coming Great Deconstruction.

One Orange County city has already taken bold steps to correct its $10 million deficit. It may be a model for other cities and states across the country. Internally, it has decided it will not replace any city worker that dies, retires, moves or quits. The city will simply out source the employment to an outside service company and eliminate healthcare requirements and unsustainable pensions. Building inspectors will be out sourced as will city plan checkers, librarians and meter maids. Only essential services like top executives and cops will remain on the city payroll. The city staff will eventually decrease from 220 to approximately 35 personnel. This is the essence of deconstruction.

It’s going to get very ugly for the parasites. Let’s just hope they don’t end up killing the host.

[Update a few minutes later]

Business and unions meet to discuss upcoming pension disaster.

Business, Economics, Education, Political Commentary

That Bursting Higher-Education Bubble

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More thoughts on this topic, from Michael Barone.

[Update a while later]

Roger Kimball notes another similarity with housing:

As I wrote in a piece for The New Criterion a few years ago,

“Many parents are alarmed, rightly so, at the spectacle of their children going off to college one year and coming back the next having jettisoned every moral, religious, social, and political scruple that they had been brought up to believe. Why should parents fund the moral de-civilization of their children at the hands of tenured antinomians? Why should alumni generously support an alma mater whose political and educational principles nourish a world view that is not simply different from but diametrically opposed to the one they endorse? Why should trustees preside over an institution whose faculty systematically repudiates the pedagogical mission they, as trustees, have committed themselves to uphold?”

Just imagine the sorts of sub-literate, ideologically charged nonsense that Women’s Studies debtor was battened on in her classes! The Australian philosopher David Stove, commenting on the Faculty of Arts at Sydney University, formulated a diagnosis that applies to the teaching of the humanities of most Western universities: It is, Stove wrote, a “disaster-area, and not of the merely passive kind, like a bombed building, or an area that has been flooded. It is the active kind, like a badly-leaking nuclear reactor, or an outbreak of foot-and-mouth disease in cattle.”

There are incipient signs that a Great Recoiling from this intellectual disaster is beginning to form. It will be greatly aided by the economic disaster in which the institutional life of universities is embedded. “Why,” hard-working parents will ask themselves, “does it cost more than $50,000 a year to send Johnny to college.” Leave aside the question of what it is that Johnny is and isn’t learning in those ivy-covered walls. Why does his four-year furlough from the real world cost so much? One reason, of course, is that Johnny, assuming his parents are paying full freight, is paying not only for his own tuition: he is also helping to foot the bill for Ahmed, Juan, and Harriet down the hall. Colleges routinely boast about their generous financial aid packages, how they provide assistance for some large percentage of students, etc. What they don’t mention is the fact that parents who scrimp and save to come up with the tuition are in effect subsidizing the others. How do you suppose Johnny’s parents feel about that?

Honk if I’m paying your kid’s tuition.

Business, Economics, Media Criticism, Political Commentary

The Deluded Fantasy Life

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…of David Brooks:

Many of the president-elect’s advisers had been reading histories of the New Deal. They had ambitious plans to address the crisis: federal jobs programs, new building projects, new spending initiatives. This was no time to worry about deficits, they said. This was an opportunity to address needs that had been neglected for decades.

Obama, in this fanciful version, held up his hand. He told his aides to put away the history books and reject the New Deal comparisons. Unlike in 1932, Americans today have a raging distrust of Washington, he observed. Living through a crisis caused by excessive debt, they will viscerally recoil at the prospect of federal debt without end. “Somehow,” Obama concluded, “we have to address the crisis without further terrifying the American people.”

The stimulus package, he continued, should rely heavily on cutting payroll taxes. This, he argued, will send a quick jolt to the economy without concentrating power in Washington. It will deliver a sharp psychological boost to the middle class. It might even be bipartisan. Obama noted that John McCain had a $445 billion stimulus plan along these lines and his fellow Republican senator, Mel Martinez, a $713 billion plan.

A fanciful version indeed. The frightening thing is that David Brooks actually believed (and perhaps, somehow, still does) that Barack Obama was ever ideologically capable of such a thing, or so wise. You and other bien pensants foisted him on us, David, despite our warnings, because you didn’t want your DC party invites to dry up. When will you admit that you quaffed too deeply the koolaid?

Business, Economics, Political Commentary

Dear Patients

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A waiting-room letter. From this doctor.

I don’t think the donkeys realized just how high the voltage was on that rail. But they’re going to find out in two months.

Remember all of the fools on the left who said that the reason that the Republicans took over in 1994 wasn’t because of the attempt to pass health care, but because the attempt failed? Well, we’re about to see if their latest experiment confirms, or falsifies that absurd theory. Some myths die hard, but it will be interesting to see if this one survives.

Business, Economics, Political Commentary

The First Kiss And Tell

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Rattner rats out Obama:

– Rattner describes presidential political adviser David Axelrod coming to car meetings armed with poll data to support the takeover and Chief of Staff Rahm Emanuel identify Congressmen in whose districts large Chrysler facilities were located.

– “[Obama’s economic team] veered dangerously close to having the government take control of the two most troubled banks, Bank of America and Citigroup.”

Rats will be rats.

Business, Economics, Media Criticism, Political Commentary

Health-Care “Reform”

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…and the endangered Democrat majority:

It was during the health care debate that the essential building block of the Democratic majority – Independent voters – began to crumble. It was evident in the generic ballot. It was evident in the President’s job approval numbers. It was evident in Virginia, New Jersey, and Massachusetts.

What’s really amazing is the ongoing delusion (notoriously assisted by Bill Clinton) that once they passed it, it would magically become popular.

They used to say that Social Security is the third-rail of American politics, but given 1994 and this year, I think that health-care “reform” (at least democratic socialist style) is. And this time, the donkeys jumped on it with all four feet.