Category Archives: Economics

Business, Economics, Media Criticism, Political Commentary

The War On Industry

9 Comments

Make that industries:

So starting as a presidential candidate, Obama has:

Called for bankrupting the coal industry.
Raised gas prices by forcing domestic production to a crawl.
Demonized bankers and automatic teller machines.
Went to war against Fox News, talk radio, and Twitter user Kevin Eder.
Alienated Wall Street, which backed him in 2008 — and will probably do so again.
Nationalized the car industry.
Forced Chrysler to terminate 25 percent of its auto dealers.
Demonized Las Vegas.
Alinskyized the Chamber of Commerce.
Blocked Boeing from expanding into a Right to Work State.
Is busy transforming the insurance industry into the equivalent of quasi-government utilities.
Created an uncertain (to say the least) regulatory environment, making new hiring a challenging proposition.
And is now Alisnkyizing private planes, despite having temporary custody of the greatest “private” plane of all.

As Doug Ross wrote last fall, “Unlike Tricky Dick Nixon, Obama Wears His Enemies List On His Sleeve.”

And yet, when only 18000 jobs were created last month, and unemployment is at 9.2%, it’s “unexpectedly.”

[Update a couple minutes later]

See?

U.S. employers added 18,000 workers in June, the fewest in nine months, and the unemployment rate unexpectedly climbed, indicating a struggling labor market.

Emphasis mine.

[Update a few minutes later]

Economic calamity:

…Keynesian economics is a total fail. Fred Barnes quoted FDR Treasury Secretary this morning in the WSJ:

“In FDR’s time, a surge in spending by Washington was a cornerstone of New Deal efforts to lift the country out of the Depression. But unemployment never dropped below 14% in the 1930s and rose to 19% by the end of the decade. “Now, gentlemen, we have tried spending,” Henry Morgenthau, FDR’s Treasury secretary, confessed to House leaders in 1939. “We are spending more than we have ever spent before and it does not work.”

Combine that with James Pethokoukis column yesterday that lays out exactly how dire the future budgeting and debt of the US is and you have an actual, not manufactured, crisis that needs to get resolved today.

This isn’t rocket science. But it does require the progressive wing to give up their reliance on economic theory that only works in a textbook. Economics is a social science and a study of human behavior. Keynes postulated a theory and we have numerous empirical examples of that theory failing miserably. How long will it take?

Einstein said the theory of insanity is doing the same thing over and over again, and expecting different results. There, my friends, is the core principle of Democratic policy. Insanity.

Frighteningly, almost half the electorate shares their affliction.

Business, Economics, Education, Media Criticism, Political Commentary

The Cargo Cult

12 Comments

…of credentials.

[Update a few minutes later]

More thoughts from (uncredentialed) Mark Steyn:

The justification for this absurd prolongation of adolescence is that it opens up opportunities for the disadvantaged. But credential-fetishization has the opposite effect. Remember Ronald Reagan, alumnus of Eureka College, Illinois? Since then, for the first time in its history, America has lived under continuous rule by Ivy League – Yale (Bush I), Yale Law (Clinton), Harvard Business (Bush II), Harvard Law (Obama). In 2009, over a quarter of Obama’s political appointees had ties to Harvard; over 90 per cent had “advanced degrees”. How’s that working out for you? In my soon to be imminently forthcomingly imminent book, I point out that once upon a time America was the land where guys without degrees (Truman) or only 18 months of formal education (Lincoln) or no schooling at all (Zachary Taylor) could become president. Credentialization is shrinking what was America’s advantage – a far greater social mobility than Europe. We’re decaying into a society where 40 per cent of the population do minimal-skill service jobs and the rest run up a trillion dollars of debt in order to avoid that fate, and ne’er the twain shall meet, except for perfunctory social pleasantries in the drive-thru lane.

We’re looking at education upside down: We should be telescoping it, not extending it.

But think of all the academic bureaucrats! Won’t someone think of the academic bureaucrats?

Business, Economics, Media Criticism, Political Commentary

Not Wall Street

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The housing crisis was made in Washington:

Not surprisingly, politicians have not addressed the problem, even with the benefit of hindsight. The Dodd-Frank bailout bill, which was supposed to address the problems of the housing crisis/financial crisis, left Fannie and Freddie untouched. The two government-created entities are on life support after their bailouts (speaking of which, here’s a funny cartoon), so this would have been the right moment to drive a stake through their hearts. One can only wonder what damage they will do in the future.

The biggest lie that continues to be told about the 2008 financial crisis was that it was caused by “deregulation.”

Business, Economics, Political Commentary, Social Commentary

Lyndon Johnson’s Greatest Quaqmire

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The cities:

After the Medicare/Medicaid catastrophe the single greatest policy failure of modern America is urban policy. Since the Great Society era of Lyndon Johnson, the country has poured hundreds of billions of dollars into poor urban neighborhoods. The violence and crime generated in these neighborhoods costs hundreds of billions more. And after all this time, all this money and all this energy, the inner city populations are worse off than before. There is more drug addiction and more social and family breakdown among this population than when the Great Society was launched. Incarceration rates have risen to levels that shock the world (though they make for safer streets); the inner city abortion rate has reached levels that must surely appall even the most resolute pro-choicers not on the Planned Parenthood payroll. Forty percent of all pregnancies in New York end in abortion, with higher rates among Blacks; nationally, the rate among Blacks is three times the rate among white women. Put it all together and you have a holocaust of youth and hope on a scale hard to match.

This is not a lot to show for almost fifty years of fighting poverty — not a lot of bang for the buck.

It’s worse than that. It’s a lot of destruction of lives, at a cost to the productive of trillions over the past four decades.

Economics, Media Criticism, Political Commentary, Space

The Last Shuttle Flight

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…and the state of the space agency. A pretty good story by Joel Achenbach. I wish that he hadn’t let this stand unchallenged, though:

“It’s sad. There’s a lot more left in them. The airframes are certified for 100 flights. This one had 39 flights,” said senior mechanical technician Bill Powers, 58, who works for United Space Alliance, the primary contractor for the shuttle. USA already has laid off thousands of shuttle workers across the country. On July 22, the contractor will lay off about 1,900 more people here in Florida.

“It’s not wore-out. It’s just broke-in,” said Tim Keyser, lead mechanic for the orbiters. “It could fly another 20 years. We get into the guts of this thing, it’s pristine.”

That’s not what the CAIB said. The notion that the orbiters were “certified” for a hundred flights is one of the canards of the program. That was a design specification, but it’s a matter of the highest conceit to think that NASA could really know how many flights they were good for. If it were really true, they wouldn’t have needed so much inspection and TLC every flight, which was a dominating factor in the operating costs.

Business, Economics, Media Criticism, Political Commentary, War Commentary

The Community Organizer

5 Comments

…who would be king:

Obama entered office on a groundswell of a disconcerting mania, a mania in which voters imagined on this blank slate of a candidate all sorts of truly fantastic abilities and policies, none of which were warranted in his paltry, truly shabby history.

The man with no available school records, for example, was painted as a genius and his brief time as a University of Chicago adjunct (basically teaching assistant) puffed up to a professorship in constitutional law. The guy who cannot speak a logical, coherent, grammatical sentence on his own was pawned off as a literary genius to unsuspecting, foolish voters. It was inevitable that the reality of his time in office could never match the dream. It was unfortunately equally inevitable that he would prove inadequate to the difficult job of the presidency.

Still, which of those who voted for him could have envisioned the hash he’s made of things in every respect? Unemployment far exceeds what he warned it would reach if we didn’t pass his stimulus package; the housing market shows no sign of lift off; the dollar sinks more each day; manufacturing is at a virtual standstill, and Americans grow more pessimistic about the economy each day. The landmark legislation of his first (and I hope final) term, ObamaCare, is so badly conceived and drafted that Americans are likely to see the best medical service in the world destroyed unless it is soon repealed or ruled unconstitutional. In the meantime, as uncertainty about its future grows, more and more businesses are paralyzed and unable to plan for their futures.

Internationally, we keep alienating our allies and boosting our enemies. Like the Duke of York* in the nursery school rhyme, he had “10,000 men marched them up the hill and then marched them down again.” He ordered a surge in Afghanistan, the place he argued in 2008 we really should be instead of Iraq, and then order pulling them out before the job is done, and in a manner sure to increase the danger to them. Without Congressional authorization, he’s committed our troops and weaponry to a rather pointless fight in Libya; pushed Mubarak out of office in favor of heaven knows what successors; failed to do a thing to prevent Iran from going nuclear; done nothing to stop Syria’s Assad from daily slaughtering his own people; and each and every day puts the life and welfare of our staunch ally Israel at risk.

This week’s press conference revealed him as a man desperately clinging to the same rhetorical devices that have long worn thin: demagogic false choices, class warfare and a preposterous description of himself as the reasonable adult in the legislative process.

As she notes, once it becomes politically acceptable to attack him, he may be like a wounded antelope beset by the jackals of the press, who he has “unexpectedly” disappointed so many times.

He has never disappointed me, and never will.

[Update later Sunday morning]

Et tu, Evan Thomas?

Obama has got to be President of the United States,” Thomas said. “He has to be two things. He has to make a public case of how bad is this, because he is not doing that. He’s not being honest about just how bad this is going to be — no, he was partisan. He was God [bleep] Democrat! He was just, you know – being a party guy. I applaud the energy but it wasn’t getting me anywhere. He has got to rise above that and then in private, in private – he’s got to make a deal.”

I am sensing a disturbance in the Force. Thomas may not be able to, or willing to get him that automatic fifteen percent next year.

Business, Economics, Political Commentary, Space

An Open Letter To Certain Senators

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…who are writing open letters to the NASA administrator.

Dear Senators Shelby, Boxer, Feinstein, Warner, Chambliss, and Murray:

Why are you only calling for competition on one particular component of the SenateSpace Launch System? It is a huge project, estimated to cost many billions of dollars. If the taxpayer would be best served by competing the side boosters, why not increase the joy by competing the entire system, including main engines, tanks, upper-stage engines, and design? Why is that only the boosters would benefit from this novel procurement approach? For that matter, why not simply have a competition for the most cost-effective proposal to get humans beyond low earth orbit, or to resupply space station, since these are the reasons that we have been given when asked about the requirements for the SLS. Of course, such a competition might result in no SLS at all, if someone can come up with a cost-effective way of meeting those goals without it, but this is about the taxpayers, right?

Most sincerely and cordially,

Rand Simberg

[Cross posted at Competitive Space]

Business, Economics, Political Commentary, Space

Uh, Guys?

52 Comments

The supply chain is gone:

To avoid any gap in providing independent repair spacewalks as a safety contingency for the space station, Congress, NASA and the ISS partners should evaluate the option of postponing the launch of STS – 135 until more external fuel tanks and other parts can be built to support additional shuttle flights in 2012.

2012? What are they smoking?

It would be at least two years, probably three, before they could resurrect the tooling and manufacturing needed to do this, and it would cost billions of dollars that NASA does not have, and isn’t going to get. Meanwhile, we’d have thousands of workers sitting around, forgetting how to launch safely. This is just crazy, and disappointing, considering the sources. Do they really so completely lack imagination that they can’t conceive of ways to do EVA and ISS repair and maintenance with what is currently coming on line, and not relying on an unsafe hyperexpensive vehicle? This is the product of emotion, not thought.

[Update early afternoon]

I have a sort-of-related bleg. I’m working on an article about the false lessons learned from the Shuttle, and how they’re continuing to screw up space policy. Suggestions in comments are appreciated. The first and most obvious one is that it proved reusables don’t reduce cost.