Why Liberals Can't Find The Answers

I had a discussion with a very good friend today about how to explain to liberals that their beliefs, while well intentioned, cannot work.  I told him that in order to be enlightened, one has to allow their mind to open up and recognize there is another side to the argument and that side may have a valid point, or even be correct.  I am one of the very rare individuals who went to a big state university and came out more fiscally conservative than when I went in.  Entering college, I was a mainstream Democrat, buying into higher taxes for the rich and plenty of government intervention.  I then took a political science class with a professor who taught all sorts of topics, including markets and governments, from a more conservative view.  You can imagine how the other professors treated him.  Let's just say that his office was not in the "political science" building.  After taking his courses, I became either a fiscally conservative democrat or a moderate republican.  I had an awakening.  I finally allowed myself to see the other side of the argument. Mostly, that there are consequences to our liberal well intentioned actions.  This, is something today's liberals, and maybe yesterday's, do not understand.

I read an email from a friend of a friend that explained how evil Republicans were for not wanting to crack down on credit card companies.  Now, I can see why we sometimes need regulation of credit cards, because while there are two people entering into a contract, one side really has all the leverage.  Consumers need credit for almost everything, unless you want to pay for everything full in cash, even your house or cars.  So, credit card companies don't always have to give the most generous terms.  But, that isn't the issue of my rant.  This person was upset with the Republicans, because the people being hurt by the credit card companies are victims of the Republicans by not allowing a raise in minimum wage.  This liberal's argument was that if these people made more money doing their jobs (i.e. a higher minimum wage), they wouldn't have gotten so deep into credit card debt.

Let's look at this debate from the "other side".  If you are a liberal and your mind is not open, if you aren't willing to acknowledge there may be an other side that has a point or *gulp* is correct, please stop reading NOW.  But, let's look at this individual making the minimum wage that charged up their card.  First, this card does not hand out free money.  Someone leant the money so they could go buy things, whether it was food, clothes or a flat screen tv, it doesn't matter.  What if the credit card company lending you money was your next door neighbor, your best friend or a family member .  Do you think you should be able to just keep taking their money and never pay them back?  Of course not.  Stop looking at these companies as faceless corporate giants.  Many people you know are the shareholders of these companies, the owners, so when you or someone else charges up their credit card and don't pay it back, you are stealing from your next door neighbor, friend or family member who owns shares in it.  

Second, should minimum wage be increased?  Do you think someone sweeping the floors of your local market deserves 10 dollars an hour?  15 dollars an hour for that task?   While they may break a sweat doing it, is it really worth that amount?  If you owned that store, if it was your pride and joy, your sweat equity, would you want to pay some guy 15 bucks an hour to sweep it?   No way!  But, liberals believe everyone should earn a living wage.  I agree!!  Everyone, but students, part timers and retirees who have other sources of income or do not need a full time job, should be making a living wage, but the answer isn't forcing a higher minimum wage on businesses for every minimum wage employee.   If all their employees that should only be making minimum wage, because the jobs and tasks are mindless, that's a lot more money they have to start paying.  The money comes from somewhere.  There isn't a magic money tree outside.  Will it will come from someone else's salary?  Maybe that will mean one less well paid job.  Maybe everyone will have to pay more to purchase the items at that store.  Maybe the store will eventually have to close because the items are too expensive and then everyone is out of the job.  All because minimum wage was increased.  The counter argument is what's another 5 bucks an hour?  It's so little.  Well, I used to work minimum wage jobs in high school and college and it matters.  When wages went up, even a buck, people got less hours.  It matters.  When you multiply that wage increase to all the employees that make a minimum wage in a company, that is a lot less profits, and after all, companies are out there to make money for their shareholders...you and me.

So, can you see there are consequences to these actions?  If you raise minimum wage, others could lose their job.  Critics point to when minimum wages have been increased in the past, there is no massive job loss.  I can promise you some lost their jobs.  I can also tell you that the increase is phased over a period of time, often years, and it's not usually huge.  It's never a living wage.  If liberals get their way and the wage is increased to meet the living wage...layoffs will be huge.  

We also have to look at it from a practical perspective.  Should people be making that much for that task?  Those jobs are not supposed to be careers.  They are supposed to be part-time jobs for students and retirees or people with nothing to do that don't need the money.  If we want to help people make more money, we need to invest in giving them a better education and giving them the skills to work better paying jobs.  Then they will have more to spend in the economy and everyone will be better off. But, why don't liberals focus on that?  Because they think there is a quick fix to it all and there isn't.  

I thank my undergraduate professor every day for opening my eyes.  Showing me the other side to the argument.  Often, the answer rests somewhere in between.  But, if you can't ever see the other side, you will never find the answer to the problem.  I hope all these new and old liberals out there take the time to actually learn about the consequences of their actions and do things that will actually help most Americans, rather than just hurt them in the long run.

Congress Making AIG Problems Worse

So the House yesterday decided to tax the AIG scumbags, who are partly to blame for this economic disaster, at a whopping rate of 90%. They say the state and local governments will collect the other 10%. This new bill, which is not yet law, is targeted for AIG and other companies who are taking government bailout funds in excess of 5 billion and giving bonuses to its employees. This new tax rate targets bonuses given to those making the magic number of $250,000.00 per year.

I think we can all agree, it’s pretty bad that these guys and gals somehow get to reap a monetary windfall when their company was collapsing and the worldwide economy is in bad shape. It seems, on its face, not to be fair. Now, I haven’t reviewed the contracts giving them these bonuses, or the circumstances that must be met for these employees to get the money, so we will have to leave that to the imagination. I know I may be strange and unpopular here, but it isn’t the fact that these people got the bonuses that trouble me the most. Why? I'm more scared of the unintended consequences of such a rush to judgment by our Congressmen.

The dangerous underlying issues surrounding this outrage are: (1) why is Congress wasting so much time on millions of dollars, when we are running a debt in the trillions; (2) what will this do to all the other major banks and their employees (who most are not bad, but very good) that are taking TARP funds; (3) what are the consequences of Congress passing a retroactive bill, or a bill that changes the legality of something after it has already occurred?

Topic 1: Congress has spent the entire week now debating this AIG tax rate scheme. The worldwide economy is falling apart. We have two wars and a possible third or fourth on the way in Iran and North Korea. We have education, healthcare, infrastructure and defense issues at home (besides the failing economy). Why on earth are our representatives wasting such precious time on something that is honestly a drop in the bucket? Because of the media. The media is making the Democrats look bad, like the administration has no control over the TARP funds, the economy or its rebound. Fact is, it’s impossible to keep track of how every company is spending every dollar that is from TARP. I imagine this administration is doing the best it can. And, the reality is that the Obama administration doesn’t control the economy, at least not directly. So, this bill passage is just a circus to distract Americans and make the ruling party in Congress not look so bad.

Topic 2: The other major banks taking TARP funds will now fall victim to this potential new law. They too will not be able to give bonuses. This will force one of two things to happen. They will pay back TARP funds before they really should, leaving them in a weaker position, so that they can retain top talent (and pay them bonuses); or they will not be able to keep their top talent. I don’t know about you, but I (as a taxpayer) have a lot of money invested in these financial institutions, let alone all of our jobs depend on the banks staying afloat. I think I want the best and brightest minds in there. Do whatever it takes. So, how does taking away bonuses, or forcing these major banks pay back the TARP funds too early help? It doesn’t. This is not the way to handle the situation.

Topic 3: This is probably the most egregious thing that has taken place. Congress is now trying to implement a law that would take effect in the past. That means actions taken, when you thought they were, in effect, legal, become at best frowned upon and worthless and at worst illegal. There are a lot of legal theorists out there that suggest that creating retroactive laws is a horrible idea. Why? How do you follow the law, if it can be changed at anytime? What if you drove 70 on the interstate last Thursday, because it was legal? Then your state changed the legal speed limit to 40 on that same road three weeks later, but made the law effective when you drove on it last Thursday. The punishment is 10 years in prison, and there is proof you drove 70 on it. Now you can be convicted of a crime, although when you drove 70 on that road, it was legal…but now it isn’t. See the problem? You can never predict what the law will be. Now, my example is a little different than what is happening, but it will have the same effect on the stock market and the economy. How can investors properly plan their investments or execute contracts when Congress, at anytime in the future, could write laws to change the rules of the game. It’s going to scare people and it should. Retroactive laws are about the worst that can be made. Hitler use to make them in Nazi Germany to make his actions legal and the actions of his enemies illegal.

Congress’ new bill many face constitutional questions and be ultimately ruled unconstitutional. Representative Lamar Smith said it best, “Congress has let expediency override common sense.” We must ask ourselves, why is Congress rushing this? Why not take some time to debate the issue and figure out the best course of action. The money has already been given out, so why the rush? I can tell you this is not the best course. The simple answer is that House Speaker Nancy Pelosi wants to pass a quick law and sweep it under the rug, so she can say she tackled and solved the problem. Unfortunately, this solution will cause far more problems for her and President Obama to solve and could really hurt the Democrats in a couple of years at the polls. Democrats like to think they are the new world order, but Republicans had a pretty strong grip on things for a while, too…and look at what happened to them.

Is Obama Letting the Economy Tank on Purpose?

So, I have been watching the economy collapse day after day.  One would almost think the press itself wants it to keep diving.  That's obviously not the case, as we see newspapers and television stations scrabbling for more cash.  Today, the Rocky Mountain News published its last paper.  

Listening to President Obama over the past few weeks, I too was wondering if he had a stake in all of this.  When he was running for office, he had a message of hope for Americans.  He was going to solve all of our problems.  He was going to bring a new day.  We would be strong again. Granted, he has only been in office for a little over a month, but the market has fallen even further since inauguration day.  Rather than listening to the hopeful messages we got accustomed to hearing during the campaign days, we heard an Obama who has been downright scary.  Words like catastrophe, worst ever, and never recover.  What?

Since the birth of our nation, there have been between 18 to 20 recessions, depending how you count them (and depending on wikipedia's sources).  That's a lot.  Every time, America has bounced back.   We are stronger today for it.  We have learned from past mistakes.  So how is this one going to be the end to end all?  It isn't.  We just aren't used to bad ones anymore.

So why has Obama been so negative.  Simple, he wanted to get the stimulus bill passed.  Is that so wrong?  It depends on what you think will stimulate the economy.  If you think tax cuts, which has gotten us out of recessions before, then it was a bad deal.  If you think more government spending (which technically did get us out of the Great Depression, but it was spending for a war, not the New Deal), then it was smart.  However, here we are, after all that negative rhetoric, and the Dow is hovering just above 7000 points and it keeps falling day after day.  Investors are terrified.  That's not good for the economy.   They are waiting for a leader to emerge.

Then came the nearly 4 trillion dollar budget announcement this week.  Now, I'm for deficit spending in a recession.  I think it does help, but it's important where you spend all that money.  This budget is laced with Democratic Party initiatives rather than concepts that will help American's get jobs.  Higher taxes on the "rich".  Universal health care reform.  Some of the policy ideas are probably good.  Some are probably bad.  But, what you don't do when you are in a recession and America is broke...is create a bigger deficit than you need.  You wait on your drastic  reforms, because America just can't pay for it right now.  Just like we should only use credit cards sparingly, so should the government when considering deficit spending.  Not the Democrats, though.

So, why is Obama pushing this now?  Dick Morris suggests he made the economy sound even worse than it is (if you can believe that), so that the Democrats could push through their liberal agenda.  It's plausible.  The stimulus bill passed.  The Democratic Party has been licking their chops since they took control of everything to shove through their policies.  To make up for old times.  Nancy Pelosi says the people demanded it!  Really?  I think many people voted for Obama and the Democrats, because they were tired of all the corrupt Republicans and W's way of running things, more than anything.  They were tired of deficit spending!  They were tired of Iraq!  

My point is, if Obama truly is catering to his party now, not the American people, and making the economy out to be even worse, to pass through Democratic Party agendas, then it's a sad day in America.   What we need is a hopeful President with tighter controls on spending, not excessive spending.  There will be plenty of time for the Democrats to push through their agenda.  I just hope that Dick Morris is wrong and Obama is living up to his campaign promises.  We shall see.

How to Stimulate the Economy

What is happening to the American Economy? Well, it’s really the global economy, but to simplify things…let’s just keep it American. First, people borrowed more money than they could afford to pay back with their income. They financed credit with more credit. This was accomplished through credit cards, car loans and mortgages. Second, the banks went along with it. Finally, the crap hit the fan when the debt came due. Demand for everything softened, because Americans finally had tapped all their credit and couldn’t pay for anything else. There became less demand for homes, so prices fell. Then people defaulted on their mortgages…we have heard this explained a thousand times on the news and we know the outcome. We are living it.

So how do we fix it? Well, there are two models: 1. The Government spends its way out of the mess by spending money it doesn’t have…by spending OUR money. They use OUR debt to finance public projects and employing more people to build the projects. 2. The private market spends its way out of the mess. This is accomplished by massive tax cuts…basically letting businesses and individuals keep more of the money they earn.

Fans of Option 1 believe that the private market got us here. That is partly true. People got greedy and either loaned money on risky investments, or spent more than they made. Both parties in Government turned a blind eye. But is doing the same thing (Government spending more than it brings in) going to solve the problem? Don’t two wrongs make a wrong? The reason the American economy is in a tail spin is very simple…no one is buying anything. People are scared so they have cut back on spending. In part, this is irreversible, because we spent more than we could in the past. So, no matter what happens, Americans will spend less, because there is less credit.

Well, if the problem is less spending then the solution needs to be getting Americans to spend more (since we are anywhere from 2/3rds to 3/4ths of the economy, depending on the economist). The theory is, if Government spends more, it creates more jobs allowing people to spend more, because they have their new government job. But, what if instead we gave everyone that currently had a job a lot more of your money back by cutting taxes? What if we cut business taxes drastically for a period of time then gradually increased them? Businesses would have a lot more money and so would consumers. Consumers would buy more, because they have so much excess money to spend. This creates more jobs, so businesses can keep up with demand. Businesses have more money to keep current employees, make investments, and hire new help. More people have jobs, so they can keep spending money. Say goodbye to the recession.

So what happens when the tax cuts are gone and taxes increase? Well it must be increased gradually and if done gradually over time, the consumers will keep spending, because they have jobs, and businesses will keep hiring and not firing because they have consumers. Remember, the Government’s spending plan ends too. Eventually they will spend all of their money building the roads and improving the schools. What happens then? Well the roads are built and the schools are fixed…so time for layoffs? Allowing Americans to spend their own money will increase demand faster than the Government can implement its programs and by giving everyone 13 more dollars a week. Tax cuts are more drastic and immediate. People see the effects quicker and react quicker. Do our roads need to be fixed? Of course, but that can be dealt with at another time. Right now, we need to simulate the economy and fast. The Democrats can deal with education, infrastructure, and their other pet projects at a more appropriate time.

The Evil Oil Companies

Wealth redistribution is almost a certainty when Obama becomes president. Today his campaign said this lovely quote: “Obama simply asks that big oil companies contribute a reasonable share of the windfall profits they receive from high oil prices over the next five years to pay for emergency assistance for families right now,” the campaign says. http://www.politico.com/news/stories/0808/12237.html Simply asks that they pay their reasonable share? What reasonable share do they owe anyone? What is profits they receive? Don't they EARN their profits...I don't think anyone is allocating money to them. In America, this is a country where you can have nothing and make a boatload. You make a product, you sell it, you make money. If people want it, they buy it...if they don't want it, they won't buy it and you go broke. Where in the constitution does it say that you also have to give a portion of your profits to families? Where does it say you don't earn your money?

Obama and CNN love attacking the Oil Companies and portraying them as Evil. First, the oil companies do not force anyone to buy their products. It's our own fault, and our government's fault, that we have become so addicted to foreign oil. If you don't like what the oil companies are doing...move closer to your job, bike places, walk places, buy a more fuel efficient car. Second, while the oil companies profits are a lot...so are their expenses, which is why their profit margins are not obscene. If you want to tax a company for obscene profits...you need to go after Microsoft. But, you don't see Democrats going after them.

Obama's idea of windfall taxes on oil companies are horrible for two main reasons: 1. it's wealth redistribution, which is not what America stands for and is a step towards socialism or communism and 2. they aren't making windfall profits. Unfortunately most Americans are too lazy and don't understand the difference between a profit and profit margin and they don't want to take the time to go back to school to make more money. Instead they want to steal it from the "rich". How would middle class Americans like it if the rich came to their home, said you have been allocated to much money or "received" too much money, and we are going to take more for us rich folk? It would suck, huh? Well, eventually this idea will be stealing from the upper middle class, and then the middle class and then the poor when companies start laying off more people because of their high taxes. Then companies will just move. So...those rich folk will take the money they allocate, or pay in wages, and give it to people who do not live in a country with a government that loves to TAX TAX TAX. Then what? Who are we going to tax? Cows?

I understand that wealthier people should want to provide more, since they have more to give. But, everyone must be taxed at a point to where there are no diminishing returns. If you start raising taxes, jobs will leave and companies will leave. I do not know if Obama is saying this just to get elected or truly believes that people do not own their own money, but the government does. And, if the government doesn't like how you spend it, it will take it from you. WHY DOESN'T THIS SCARE THE CRAP OUT OF PEOPLE?

I was a huge Obama fan earlier in the year, until the real Obama showed up and has shown us his extremely liberal side. I want politicians who are moderates, that do not make policy based on the extremes of either party. Socialism will not work in America and it is not the American way. The more Obama talks, the more Americans are brain washed and the more I regret supporting him in the Democratic primary.

What is Wrong with Americans?

First, I would like to ask...what is wrong/scary about this picture? 1. That it looks like one of those crazy church services 2. The crowd's dazed-arm stretched out- look is very similar to another country's population in the 1930s 3. That this is a Barack Obama rally not a rock concert.

George W. Bush has done such a bad job at being president that Americans will turn to almost anything and anyone that is not George W. Bush. In fact, I heard that if Sanjaya from American Idol was over 35, he may be a lock for the next President. I will admit that a few months ago, I got caught up in this craze. I was an American that loved to hear the word "CHANGE". I didn't care what the change was, things just needed to CHANGE. I feel that most American, besides the 22% that still find something great about Bush, want a very different leader in the White House. But, there are many types of DIFFERENT and not all mean a better change. I finally decided to read about the candidates and now firmly believe one stands above the other because of his experience and stance on very important issues.

I will give Obama the Wow factor. He has been able to get people to fall in love with him. At very least, it has pumped some new blood into American politics not scene in a long time. But, there is a lot of bad coming with this Obama Wave. First, most people have no idea what he really stands for, except it's different from Bush. Well, as bad as Bush has been as a national leader, not all of his policies were bad.

Although the Media, who has fallen under the spell, loves to paint McCain as a war lover...and the comments at the end of many online news stories have jaded Americans calling him McWar...McCain is not pro war. McCain, unlike most Americans, fought in a war...McCain was tortured in war...McCain actually KNOWS how the military works, and knows what its like to lose friends and to be in some of the most horrible conditions. I would think McCain would think twice before sending his son to war. Obama does not have this experience.

My point, though is that many Americans look past this fact and many important others. Many do because they do not understand that you cannot just walk away from something and leave it worse off. Okay, we broke Iraq with the war, but I was taught if you break something you fix it. You don't just walk away. There are ways to fix it without losing a lot of life, either. The current surge has proven this. Of course, our government has been teaching us for years that Americans do not need individual responsibility. I have nothing against people that support Obama because they think and believe that leaving Iraq in a worse position is better, that having higher taxes is better, that the government needs to be our mom and dad, that the government needs to be involved in every aspect of our life. I disagree 100%, but if you really believe this then you should vote for Obama. He is YOUR man.

Many people forget or don't know that McCain is a uniter as well. Sure, he doesn't have the great speaking ability, he isn't as hip...but for decades he has been bucking his own party and making compromises for the good of the country. Look at Obama's voting record, that evidence is not there. McCain has some tough language for people that don't like to take personal responsibility...he thinks people need to be more accountable, along with businesses, but he isn't about leaving people out to dry either.

People need to understand about how the economy works, understand that higher taxes mean less money in your pockets to buy gas, less jobs for you to work, and not always more money in the government coffers. People need to understand the difference between record profits and profit margins. People need to understand you can cut plenty of government spending before you need to raise taxes to balance the budget. People need to understand that getting off oil isn't a one step solution, but takes many things happening at the same time to keep prices stable NOW and break away from oil altogether in the future. People need to understand that because the surge worked in Iraq now more troops can start coming home...but that setting an arbitrary date is stupid for so many reasons. People need to understand that the President has almost no say in what happens to the economy and has little power to affect the economy, but has enormous power over the military and upholding our laws...do you want a novice or an expert?

I really hope that people vote for the next President not based on the media, but go to their websites and read their stances. Americans need to first understand how our government works, then understand simple economics and then need to read about the candidates. After that, place your vote based on the person you agree with the most and you think can best lead this country. If you take those steps, I don't care who you vote for, because at least you are voting based on what you truly believe and not on misinformation or hysteria. Even if I disagree with your belief.

Money Talks Still In Politics

Yesterday Barack Obama said that he was no longer going to seek public money for the campaign. http://www.cnn.com/2008/POLITICS/06/19/obama.public.financing/index.html Awesome, right? He won't take the public's money. Or, is it a good thing? Didn't he make a promise to do so a few months ago? Now, he has given this a great spin by saying the money he is seeking is from private individuals who give $5, $10, $25 dollars and he needs to raise as much as he can from them to beat the evil Republicans. Public money just is not enough to beat back the Republican machine, he needs as much as possible to CHANGE America. Now, if 1,000,000 people gave $25, how much would that be? Right $3,000 er...I mean $25,000,000. Obama though has raised 272 million dollars since January. NEWS FLASH: All of this money isn't coming from people giving $25!!!

I am going to throw Obama a bone here and agree that sometimes you have to work within "the system" to change the system. In fact, I think it's mandatory. That is one reason I think it is silly when politicians say they aren't going to work with the evil lobbyist, and then have to fire their entire campaign staff the next day. It's just stupid, but I will save the lobbying debate for another day. Obama is right that sometimes you have to perform the same old tricks to win in order to make the changes desired. However, where he went wrong is he made a PROMISE to only use public money by working with his Republican counterpart to form an agreement, so neither candidate would be at a disadvantage. If McCain said no, Obama was within his promise to NOT accept public money and get it from supporters, instead. This would ensure that private interests did not affect the candidates if both candidates accepted the agreement. Very noble of Obama. Instead, though, Obama did not seek an agreement with McCain (who probably wouldn't mind public fundraising right now, since the Republicans are having trouble raising money) and went right past GO to collect as much money as he could from private individuals and companies (yes folks, let's not be naive, companies too).

Obama's entire message is about CHANGE. Many don't really know what this change is, but they know they want it. I probably can describe it most simply as people are tired of how politics works in this country. Where politicians care more about gamesmanship and building up power within a political party, than actually making some tough decisions that will piss off your supporters and your enemies in order to fix the country. Obama has showed he does not represent this change. I can hardly blame him, since almost no politician actually represents this type of change. It's nearly impossible, especially since you have to work within the system first to then change it later (and piss off many, ruining chances for reelection). But, Obama goes around preaching that he is better than all the other politicians, that he really is this savior, that he runs a clean campaign.

Unfortunately, all I have noticed in this campaign by both parties is politics as usual. The same tricks, the same distorting of the truth, the same backpedaling when a promise made six months ago no longer seems attractive...or while it's the right thing to do....it may cost you the election. This is the point when every politician starts to see the gold at the end of the rainbow. They imagine themselves in the White House, moving in the new furniture, calling the shots. They imagine all the good and change they will do. Then they say, no matter what the cost, do whatever it takes to win. Who can blame them? I just don't like when a politician comes out and won't admit what he or she is really doing...or worse, try to claim they are DIFFERENT, grabs the hearts of so many in the country, and then uses the same bag of political tricks.

If Obama is going to say he is about CHANGE and makes promises to do something...I expect him to keep them. If he turns the other way because it's EASIER or it gives him a better chance to WIN...then he is like the rest of them...and his message is one big LIE. Surprise!

(Editor's note: I will attack McCain one of these days...but Obama is just giving me too much material)