Category Archives: Economics

As Dave Weigel Was To Conservatives

So is Steve Pearlstein to businessmen.

I heard that interview in the car, and was just shaking my head. How is it that someone this clueless about business and businessmen covers them as his beat? Just another reason that the legacy media is going down the tubes. As one commenter noted, that interview could have come right from Atlas Shrugged.

Via Instapundit, and yes, Amity Shlaes’ history of the Depression makes a hell of a lot more sense to me than any others I’ve read of it.

The Land Of Obama

Leads the way to fiscal meltdown:

The state of Illinois — broke, overleveraged, and still refusing to get its accounts in order — is up to something interesting: selling bonds to meet its pension obligations. As one of the many states that refuse to set aside adequate money to fund its public-employee pensions, Illinois is headed to the debt markets to raise $3.7 billion for pension liabilities to get it through the year. This is a double dip: In January, Illinois sold $2.4 billion in bonds for pension obligations. Actually, make that a triple dip: It sold $10 billion in bonds to fund its pension liabilities in 2003. “States don’t traditionally fund their pensions with debt,” says CNN in a nice bit of understatement, “but the practice frees up other money that can be used for operations.” The double whammy here is that Illinois’s pensions are in trouble because it already spent the money it needed for its pension contributions in past years on other spending: Which is to say, Illinois is borrowing money it will have to repay eventually to repay the pension money it already spent to pay for other spending it couldn’t afford then and can’t afford now. If you’re wondering where Barack Obama developed his fiscal finesse, you don’t have far to look.

And wasn’t it nice of them to send him to Washington where he can do the same thing to the rest of us?

The Big Green Lie

Exposed:

Greens who feared and climate skeptics who hoped that the rash of investigations following Climategate and Glaciergate and all the other problems would reveal some gaping obvious flaws in the science of climate change were watching the wrong thing. The Big Green Lie (or Delusion, to be charitable) isn’t so much that climate change is happening and that it is very likely caused or at least exacerbated by human activity. The Big Lie is that the green movement is a source of coherent or responsible counsel about what to do.

The greens claim to be diagnosticians and therapists: that they can both name the disease and heal it. They are wrong. The attitudes and political vision of a group of NGO pressure groups may work when it comes to harassing Japanese whale ships in the Antarctic; this vision and these people come up short when set against the challenge of moderating the impact of human industrial activity on the earth’s climate system.

They come up short in many areas.

Obama Is Not A “Socialist”

Technically speaking, anyway:

I’ve already commented on this issue twice, remarking that Obama technically is a fascist, but that it is much better to call him a statist or corporatist. But there is the tricky issue of whether a word should be defined by experts (to the extent economists are experts on anything) or whether it is more appropriate to accept the common understanding of what a word means. I don’t have a firm opinion on that issue, but if socialism now means someone who believes in lots of government intervention and redistribution, then Obama is a socialist (heck, Bush also would be a socialist). But if we stick with the official definition, which involves government ownership of the means of production, then Obama has relatively few policies that meet that standard.

He does have a Marxist outlook, though (as all true fascists do).

[Update a few minutes later]

Why Obama is failing. Because he lied his way into office:

…we were lied to about this by Obama and the MSM winked. Yet it was a far more significant lie than Clinton’s proclamations about Monica Lewinsky, which only peripherally affected affairs of state and were obviously the desperate acts of a man caught cheating. Obama’s prevarication was about the very essence of his political views. Widely desirous of electing its first black president — I felt this myself but did not act upon it — the nation gulped and swallowed the lie, but, consciously or unconsciously, it did not forget.

Now we are where we are. We have a president that no one wants to listen to because we do not fully believe him. His own party is deserting him not just because they know his ideas are unpopular. They also know he is unable to convince anyone. We have shut him off.

The irony, of course, is that his biggest supporters, who still continue to support him — young people and blacks — are being hurt the most by his policies.

Which Senator?

…will save the space program from a Shuttle-derived parasite eating up all the technology funding?

This bill, however, will probably not get very far. Note Jim Muncy’s comment to the NASA Watch item:

Fortunately, most authorization bills can’t proceed in the Senate without unanimous consent. Which means one Senator can stop this monstrosity.

We continually hear about how “The” Congress is opposed to the Administration’s plan for NASA. However, most all of the vocal opposition to the plan has come from a limited number of Congresspersons protecting Constellation related projects in their states and districts. They deliberately biased the hearing witness panels to eliminate voices of independent support for the administration’s plan.

I’m thinking maybe Sam Brownback.

As a commenter somewhere (maybe over at Space Politics?) said, the key to settling space isn’t going farther now — it’s reducing the cost of access and making it routine. Commercial crew will do that for LEO, and the new technology development programs will do it for beyond. And heavy lift, particularly a Shuttle-derived version, will just continue to delay the day that we become spacefaring, as the falsely perceived need for it has done for forty years.

[Update a few minutes later]

What is Bill Nelson thinking?

A draft of the bill, obtained by the Orlando Sentinel, was presented to NASA last week by the committee, chaired by Florida Democratic U.S. Sen. Bill Nelson. So far the White House has not commented on the bill, but several Florida Space Coast leaders have expressed concern about its impact here.

Of particular concern is the fact that Nelson — Florida’s main space supporter — would take away billions of dollars from commercial rocket and technology development that over the next decade would have diversified the aerospace industry in Florida and provided KSC with new jobs and prestige.

…Frank DiBello, the president of Space Florida, the state’s aerospace development body, is not pleased. “We don’t want to sacrifice Florida seed corn for an increased R&D role to be politically expedient and save jobs for Utah and other states,” DiBello told a Brevard County jobs-development meeting Saturday.

“The Senate bill kills outright the promise of a real R&D opportunity for KSC. It’s not good for Florida. I don’t know who Bill Nelson is listening to, but it’s not his constituents,” DiBello said.

Of course, the question itself is generous in its assumption that there is any cognition at all going on here. Bill Nelson has never struck me as the sharpest tack in a drawer of pretty dull ones, and this is just more evidence of it.

The Catastrophic Response

The nation is being run by looters and vandals:

As more and more startling facts emerge we are finding almost criminal ineptness by Washington compounded by BP’s almost criminal negligence. As with many crises, Washington’s reactions cause greater damage than the event itself. Yet lurking in the mess are the extreme environmentalists staffing the Obama Administration with their declared agenda of shutting down all offshore oil drilling. The Sierra Club has bragged about how it helped shut down all new coal generating electricity plants. Other environmentalists are still happy that the Three Mile Island crisis succeeded in ending all new nuclear-generating power plants. Preventing new offshore oil drilling in Alaska is another of their primary objectives.

Now CNN reports that almost all new drilling activity has been suspended for over two months. This includes shallow wells in less than 500 feet of water—despite Obama’s statement that such wells would not be affected by his orders to cease all deep-water (over 1,000 feet) drilling. After thousands of deep-water wells have been drilled successfully without spills, the Interior Department, under Secretary Ken Salazar, has so delayed permitting and continuing operations as to possibly bring financial ruin to countless smaller companies. It would be similar to shutting down all airlines after a single crash. It may be that Salazar and his gang are just so ignorant of business that they think the government can simply shut down the super-sophisticated flow of supplies and men and then later restart it like flipping an electric light switch. It’s already estimated that it will take two years or longer to get Gulf production back to its pre-suspension levels. Meanwhile, deep-water drilling rigs—which cost over half a million dollars per day to operate—are being sent away from the Gulf to work in Africa and Asia where they are wanted. It will take months, if not years, to bring them back. Some 100,000 high-paying jobs are now at risk. Already the number of deep-water rigs has dropped from 42 to 19.

But they’ll blame “deregulation.” And George Bush.

Jonathan Chait

versus reality.

We can’t do anything about the White House for another two years, but I’ll bet that a Speaker of the House other than Nancy Pelosi would be a huge shot in the arm for business confidence.

[Update a while later]

The Lady Gaga economy:

Right now, there’s lots of demand for Lady Gaga, say; but maybe too many houses, cars for sale, and hokey Internet startups.

Economic recovery requires massive spending cuts, deregulation, privatization, tax-cutting, avoidance of monetary inflation, and elimination of government-granted monopolies and favors. But, more importantly, economic recovery requires allowing prices and wages to adjust to market clearing levels. Politicians don’t allow that, so downturn is deliberate policy in a sense. Politicians instead stimulate demand in random, whim-driven ways that create new distortions that harm us later (when they’re out of office, or their earlier misdeeds are forgotten or forgiven).

Such policy prescriptions foster political ends that have little to do with actual economic recovery. Recession is already inevitable if government does not perform its core function of preventing the interest group manipulation that distorts smooth economic enterprise. It’s doubly so when politicians deliberately distort the economy’s workings.

Beyond performing its “classical” functions of maintaining order and thwarting contrived scarcity, government can only serve as a transfer mechanism. Inherently limited in what it can contribute to the real economy, it can certainly subtract a lot.

And it certainly has.

[Update a while later]

The Money Honey weighs in:

You are seeing businesses follow the growth outside of the United States. But absolutely – that is the positive. The reason that they’re not hiring right now is because there is a tremendous amount of uncertainty. And that has everything to do with the policies coming out of this administration. Higher taxes in 2011, higher expenses as a result of health care costs. That’s why they’re not hiring.”

Well, duh.