Smoot-Hawley?

Remember that "Buy American" provision in the $787 Billion Stimulus Package?
It inserted "shall be applied in a manner consistent with United States obligations under international agreements," to help appease our trading partners and rightfully so.
The most basic fact about trade is that it's a two way street.
You buy my goods, pay me in your currency and I buy your goods that you pay with my currency. Simple enough even Congress sometimes figures it out.

Apparently though, local municipalities and state governments read "international trade agreements" like Congress reads the Bills it passes.

Ordered by Congress to “buy American” when spending money from the $787 billion stimulus package, the town of Peru, Ind., stunned its Canadian supplier by rejecting sewage pumps made outside of Toronto. After a Navy official spotted Canadian pipe fittings in a construction project at Camp Pendleton, Calif., they were hauled out of the ground and replaced with American versions. In recent weeks, other Canadian manufacturers doing business with U.S. state and local governments say they have been besieged with requests to sign affidavits pledging that they will only supply materials made in the USA.

Outrage spread in Canada, with the Toronto Star last week bemoaning “a plague of protectionist measures in the U.S.” and Canadian companies openly fretting about having to shift jobs to the United States to meet made-in-the-USA requirements. This week, the Canadians fired back. A number of Ontario towns, with a collective population of nearly 500,000, retaliated with measures effectively barring U.S. companies from their municipal contracts — the first shot in a larger campaign that could shut U.S. companies out of billions of dollars worth of Canadian projects.

You know what that means....those Canadian's are not buy our goods. Which means, our goods are not going to get sold, which means a cut in productions which means a cut in employment.
Economists know it, that's why they opposed the "Buy American" provisions in the first place.

Second, the notion that even an effective W.T.O.-consistency qualifier in our procurements will soothe other nations and prevent trade retaliations and trade wars is naïve. Contrary to what others believe, countries like Brazil, China and India, which have not signed the W.T.O.’s 1995 agreement on governmental procurement and, therefore, do not enjoy those rights to our procurement purchases, will retaliate. They can raise many current tariffs also in a “W.T.O.-consistent” way. (Remember that China and India have large public sectors.) They can easily shift their purchases of aircraft, nuclear reactors and other high-value goods from us to Europe and Japan. We would then retaliate, prompting retaliations by the others: all in a W.T.O.-consistent fashion. Indeed, President Obama would find himself in a W.T.O.-consistent trade war.

This one from Burton Folsom author of New Deal or Raw Deal?

“Slap a tariff on China and save American jobs,” the protectionists say.

This tempting line of reasoning is flawed for two reasons. First, if Americans pay more for, say, American-made shoes or shirts, then they have less to spend for other things they might need — they are simply subsidizing inefficient local producers. And those American manufacturers, who are protected from foreign competitors, have little incentive to innovate and cut prices.

Second, if we refuse to buy China’s imports, China will refuse to buy our exports, including our first-rate computers and iPods. Our export market collapses. We saw this happen during the The Great Depression when Congress passed, and President Herbert Hoover signed, the Smoot-Hawley Tariff in 1930. That tariff, the highest in United States history, foisted high import duties on more than 3,000 foreign items. The Europeans immediately retaliated, and this deepened the Depression throughout the world. When we refused to buy Swiss watches, for example, the Swiss refused to buy American wheat and Chevrolets.

The collapsing export market after 1930 helped to set off a decline in American industry. United States automakers sold more than five million cars and trucks in 1929, but only about 1.8 million in 1933. Other causes (including tax increases under both Hoover and Franklin D. Roosevelt) also made the Great Depression worse, but the Smoot-Hawley Tariff was a significant reason the Depression was as severe as it was — 25 percent unemployment at its worst.

Free trade benefits buyers and sellers. Tariffs benefit certain sellers at the expense of all buyers.

Unfortunately, those who don't learn from history are doomed....well you know the rest.

Dems need to start their 12 steps.

So I don't have much time to post, but I was reading at Liberal Rapture a post today that had this in relation to Obama's Gitmo reversal today.

But here's the worst problem with the reversal - it empowers the right wing:
Liz Cheney Claims Victory In Obama Detainee Photo Reversal

It got me thinking about what's so wrong with admitting that Cheney was right?
Here is what I wrote...
hat really amazes me about this Gitmo thing, is the amount of spinning going on to basically not say....Bush and Cheney were right the whole time and Barry was wrong.

The Democrats have a problem. It's not just Slim. Democrats know how to oppose. They know how to protest the Right and they know how to ridicule (ala Prejean) even if they have the exact same view as the people they ridicule (Prejean/Obama/Clinton...all have the same view on Gay Marriage)
The problem is that when rubber meet the road, the Democrats don't know how to move past the ridicule/oppose your opponent at all costs stage. Gitmo is a great example of this.
They (Dems) want and need to oppose everything Bush and Cheney stood for. They put it in their heads that Bush and Cheney and anything, I repeat anything that they are for, has to be evil.
I mean how can Darth Cheney do anything "good." The Democrats label Republicans as evil in almost religious, making very very hard to admit that sometimes, the GOP can be right. Reid, Pelosi, Hoyer, Daschle and Obama are no better than Bush. I'm sure it would surprise people how much they agree with one another on a lot of issues, the problem is, in public even if Obama and Bush agree on say gay marriage, Obama still has to make Bush out as some sort of evil Monster to appease the base.
Pelosi voted for Iraq and said nothing against the CIA's EITs (essentially approving it) which is the exact same position Bush wanted. Now she either has to admit that the "Village Idoit" fooled her not once, but twice...making her ever dumber than the "Village Idiot" or actually admit to her base, that Bush might have made the best decision he could at a difficult time. Obama is echoing the latter with his reversal. Bush wasn't perfect, far from it. He did a lot of shitting things, but his decision to hold military tribunal is far better than civilian courts, which let the terrorists go free and go back to killing Americans (1 in 10 according to Obama's Pentagon)
Why it's only reported in a British Newspaper could help explain why our newspapers are going out of print? Hmmm I wonder?

Democrats, progressive and liberals need to admit they have a problem. Like any good 12 stepper, if they want to reform the Democratic party, they need to admit that the Democrats in office and democrats in general can be bigots, sexist, hypocrites, anti-gay rights, pretty much everything they say Republicans are. Only then will they be able to reform the party.

One thing I love about LR readers is the comments that sexism is so blatant in today's society and the reason HRC wasn't nominated. Yet no one wants to look at the elephant in the room, that it was the Democrats sexism and the Democrats bigotry that coast HRC the nomination. It was Democratic Party sexism, bigotry, age-ism, racism that helped put Obama in power. Now we reap the consequences of DNC bigotry.
Why did Obama block Cheney's attempt to release 2 CIA memo's that Cheney says prove the EIT's worked?

Obama can and has declassified any memo he wants. He has full authority to wave his fucking hand and let the memo's go public.

It doesn't matter if you agree or disagree with the CIA's EITs...isn't it better to have all the facts on the table? If your morals are such that nothing is worth "Torture." Then what would it hurt to release Cheney's memos?

Obama already has admitted that Cheney was right about Military commissions. I guess letting Cheney be right about 2 things is more than Democrats can handle without their heads exploding.

By saying that he has now concluded that releasing the photos would endanger the troops, Obama is reinforcing the idea that he was originally prepared to do something that would endanger the troops, and only reversed himself after conservatives called him out on it.

There really is more that needs to be said of this. Democrats have built an empire on insults and prejudices that just can't be sustained any longer. The world is too dangerous to keep going on with this pettiness.

There was also a comment on one reason why Carrie Prejean get's her own segment on Countdown for her view on Same Sex Marriage, and Obama doesn't, even though they hold the exact same view on Same Sex Marriage.
Maybe it's sexism? Gee you think?
That ties in with what I was trying to say above. The Democratic Party is full of sexists, racists and bigots. They can't admit it or all their insults about Republicans will finally be correctly viewed as hypocritical.
Eventually, the glass house the Democrats have built will come crashing down.
I just hope it sooner rather than later.

Cap and Trade dead?

Maybe not yet, but it took a serious blow today from and EPA report from the OMB.

An EPA finding last month that greenhouse gases are a danger to public health rests on dubious assumptions and could have negative economic impacts, a memo from the Office of Management and Budget (OMB) warned.

The memo has no listed author but is marked “Deliberative–Attorney Client Privilege.” A spokesman for OMB told Dow Jones Newswires that the brief is a “conglomeration of counsel we’ve received from various agencies” about the EPA finding, the conclusions of which would trigger regulation of greenhouse gases under the Clean Air Act.

The author(s) of the memo suggest the EPA did not thoroughly examine the relationship between greenhouse gases and human health.

“In the absence of a strong statement of the standards being applied in this decision, there is concern that EPA is making a finding based on…’harm’ from substances that have no demonstrated direct health effects,” the memo says, adding that the “scientific data that purports to conclusively establish” that link was from outside EPA.

I repeat, "Negative Economic Impact!"
Skeptics like me have been harping on this for a while now...and this new report comes from Obama's OMB!

We'll just have to see how this unfolds, but I know I'll be using this memo for a while now.

Obama's Don't ask Don't Tell

You know Obama and the rest don't give a damn about Don't Ask Don't Tell. Why should they? They will use it again in 2010 and again in 2012 to keep the gay rights vote. If they were actually going to go through with their promise, they would have done something by now.

They are using gays for votes. So they use Fear.
Just like the throw the "racist" card out there to scare blacks to vote Dem.

It's the oldest political ploy in the book, straight out of ol' Saul Alinsky...it's just funny that people keep falling for it.

I repeat...I'll keep harping on this...Vote all the fuckers out of office
Keep voting them out until they get the message....listen to the people or your ass is out

But...I'm sure there are plenty of gays, blacks, feminists that are too afraid of changing their vote...so the status quo will just go on.

Just like with HRC, if it weren't for the "status quo" politicians (aka Super Delegates), HRC would have won the nomination, and some real change would have occurred...I wouldn't like her health plan for sure...but a real breath of fresh air would have been nice...instead we get the status quo POTUS that is Obama, hence the Bush=Obama.

But partisan prejudice runs too deep...so I don't think we will ever get real change until we are all broke wondering what the hell happened.

Obama and the Unions

A common theme in the Obama administration is he will do anything Big Labor wants.
He did it with the Chrysler bankruptcy. You know he will do with with GM.
The level of corruption is horrendous, yet nothing is being reported.
The press is in the bag for Obama. That is nothing new.
It's surprising to see the LA Times report on the SEIU's involvement in Obama's California thuggery.

The officials say they are particularly troubled that the Service Employees International Union, which lobbied the federal government to step in, was included in a conference call in which state and federal officials reviewed the wage cut and the terms of the stimulus package.

This is yet another example of Obama's willingness to break his campaign promises for the people that gave him money.
Ed Morrissey at Hotair has a great post on it.
What really puzzles me is why he isn't pushing for Card Check all that much?
I think maybe, it's because he's waiting for after the 2010 elections. That way if the GOP make gains, he has a fall back. If the Dems stay in power then he has nothing to worry about. It will pass and he won't have to expend any of that political capital.
Basically, he is selfish. Of course that's nothing new.

Gaming the System

J-SOM over at Liberal Rapture posted about how people really don't know what the hell is going on.

I see no "recovery" at all in the traditional sense. I know. I know. Who am I to make predictions on the economy? After watching one "economist" after another get it ridiculously wrong on national television, why shouldn't I join in? Apparently all it takes to become an "economist" is the ability to speak and play guessing games. I am more than qualified as I can speak, play guessing games and push publish on the blogger "New Post" thingy. Therefore I am an economist.

While I agree that the recovery won't be in the normal sense. It really got me thinking about the system as a whole. How in the hell did we get here in the first place? Does anyone know what the hell is going on?
I'll start with the last one. I do think there are some people out there that know what the hell is going on. People like Peter Schiff, Thomas Sowell, Walter Williams and those pesky Austrian school economists over at Mises.org
Peter Schiff back in 2006 said that accurately forecast that the U.S. housing market was a bubble that would soon burst. He also is quoted as saying in 2006, "The United States economy is like the Titanic and I am here with the lifeboat trying to get people to leave the ship ...I see a real financial crisis coming for the United States."
Of course for being a prognosticator of things to come of which nobody wanted to hear, he was subject to ridicule. I'm not going to glorify Schiff by comparing him to Cassandra. Although I guess I just did.
The same could be said of the Austrians. Their economics don't fit with the current political and elite class in our society so they are ridiculed.

The next question which ties back in to my last sentence is how did we get here?
In my opinion, it's because we, as a public, have been fooled into believing that the solution to our economic woes are the same thing that got us into the predicament in the first place, spending.
Government spending has always been with us, governments tax and then spend. It's as natural as water flowing down a stream.
What isn't natural is what happened during the 1930's. The level of Government intrusion into the private sector was unheard of not just in the US but in Europe as well. Politicians have always been dirty, again that's natural. What the levels of spending did, was give the politicians more and more leverage to use to keep them in power.
Take Social Security, FDR was a genius passing that through. What it did was give people something for relatively nothing, and guarantee their votes for him as long as the government paid up. Politicians of both parties have been doing it ever since.
The Government has never, except for the ending of the two World Wars, decreased the level of spending compared to previous years. Government continue to grow, even if the economy doesn't. The true evil here is, thanks to the crack cocaine of Keynesianism, they spend more, when the economy is at it's worse. Of course where does the government get the money? From tax payers, borrowing or printing.
FDR was the original street hustler. Not only did he get the country addicted to "Free" government money, but his breaking away from the Gold Standard, made the government printing press more dangerous than all the flu outbreaks in the last 100 years. Fiat money, that's what we are addicted to. Gold used to be $30 an ounce, now it's around the $900 range and growing. The easy money policies, increased consumer credit. The increase in consumer credit made it easier for people to buy. And buy they did. J-Som hit it on the head when he said:

70% of US GDP is consumer spending. An economy that is based on consumer spending is, in fact, not an economy at all. It is the basis for other countries' economies. Further , it is a sink hole dependant on ever expanding lines of credit and the need for us wee folk to forever be debting to purchase more crap we do not need or want. The model of human beings/American citizens, called "consumers" by our good friends the economists, always consuming more as a way of life, thereby propping up the world economy is dying.

Washington wants us to buy buy buy shit we don't need. The over extension of credit, caused the housing bubble. People that couldn't afford a house, were given easy loans thanks to Fannie, Freddie, Politicians and ACORN. The banks didn't want to do it at first, but once they got a taste of that good government crack, they couldn't say no. So they became the "evil banks preying on the poor." It's easy to blame the banks for giving people money they couldn't pay back, for giving 10 credit cards to people making $10 bucks an hour, but lets not forget what enabled the banks to do it in the first place, the Government and its spending.
Now it's on to the bailouts and TARP. First of all, lets get something straight. The banks gave this money out, knowing full well that the Government would bail them out if they needed it. Why? because the government has been bought and paid for by Wall Street. Both parties get huge sums from Wall Street Banks every election cycle. This last cycle, Obama was at the top of the chart, well next to Dodd. It's an investment to Wall Street. Give the politicians money and a job, before or after office, and they will never be short of cash again. The government can force money from it's citizens, where as banks have to offer incentives. Which one do you think brings in the more cash?
And the system works wonderfully. TARP has given billions to the banks. Who knows how much and to whom. One thing is sure, the politicians in office now won't be short of campaign contributions come 2010 and beyond.
They games the system. It's the public that are the patsies. We pay the bill in the end. It's only a matter of what will be left when the dust settles.

This is more of a rant than anything else, so apologies if it doesn't flow that well.

Is it worth it?

Is it worth $357,000?
Was it worth the terror felt by the NYC inhabitants, when they saw a 747 heading towards the Manhattan skyline, fearing another 9/11 style attack?

Finals

Sorry haven't posted in a while, have finals and helping the wife with her finals. Next week, when I'm in San Antonio I should have some more time.

Obama hardball tactics

And they used to say Bush was trying to shred the Constitution and civil liberties. Ha

Conversations with administration officials left them expecting that they would be politically targeted, two participants in the negotiations said.

Although the focus has so been on allegations that the White House threatened Perella Weinberg, sources familiar with the matter say that other firms felt they were threatened as well. None of the sources would agree to speak except on the condition of anonymity, citing fear of political repercussions.

The sources, who represent creditors to Chrysler, say they were taken aback by the hardball tactics that the Obama administration employed to cajole them into acquiescing to plans to restructure Chrysler. One person described the administration as the most shocking "end justifies the means" group they have ever encountered. Another characterized Obama was "the most dangerous smooth talker on the planet- and I knew Kissinger." Both were voters for Obama in the last election.

One participant in negotiations said that the administration's tactic was to present what one described as a "madman theory of the presidency" in which the President is someone to be feared because he was willing to do anything to get his way. The person said this threat was taken very seriously by his firm.

The White House has denied the allegation that it threatened Perella Weinberg.

They deny everything of course, but this story could have legs if the Obamamedia gets off Barry's nuts and actually reports the story...that of course remains to be seen.

I still hate Krugman

His new piece is a piece of crap.
Talking about cutting wages...I know Krugman is drunk of the Keynesian Kool Aid. The same draught that help bring on this global recession, but leave it to a drunk to search for the answers in the same bottle that brought all the problems.

And soon we may be facing the paradox of wages: workers at any one company can help save their jobs by accepting lower wages, but when employers across the economy cut wages at the same time, the result is higher unemployment.

Krugman assumes that every industry in the entire country will cut wages, this of course will never happen. For one the huge Government employment machine can and will never cut wages. With Obama growing Government to astronomical levels, its hard to see wage cuts in xyz industry effecting the economy as a whole
Also, not all industries are effected the same way. Some industries are booming, can we say guns and ammo? The gun industry can't keep enough product on the shelf, demand is just too high. Oh and Best Buy is as busy as ever.
Of course Krugman doesn't mention Unions, whose wages were artificially inflated in the first place. Cutting UAW wages by 20% won't even bring then down to Toyota, or Honda wage levels.

Then Krugman goes on to quote Jack Daniels himself, Keynes.

Things get even worse if businesses and consumers expect wages to fall further in the future. John Maynard Keynes put it clearly, more than 70 years ago: “The effect of an expectation that wages are going to sag by, say, 2 percent in the coming year will be roughly equivalent to the effect of a rise of 2 percent in the amount of interest payable for the same period.” And a rise in the effective interest rate is the last thing this economy needs.

He is blind to the fact that wages, and prices never fall or rise uniformily. Like I said above, it's all relative. Krugman and Keynes are basing their arguement that the wages will fall for everyone at the same rate, which is simple not true nor can it ever be true. Their whole argument is based on a lie!

I encourage everyone to read, Failure of the New Economics by Henry Hazlitt. It is essential to disproving Keynes once and for all.

TARP Unconstitutional?

TARP has been a power grab from the get go.

Now the Obama administration is using the authority in TARP to push through a bankruptcy plan for Chrysler.
It sets a very bad precedent. Under the plan, Chrysler's secured creditors, you know the people that loan Chrysler money, will get screwed in favor of the UAW.

The kicker is now those creditors, that Obama wanted to push out have filed in court that it violates their 5th amendment rights.

Remember all the Dems that said Bush was trying to destroy the consitution? Yeah....right.

15. Relying on purported authority provided by TARP, the Treasury Department is demanding that Chrysler’s assets be stripped away from the coverage of the Senior Lenders’ liens – thereby impairing the rights of the Senior Lenders to realize upon those assets – so that those assets may be put in New Chrysler and used to the benefit of unsecured creditors in this proceeding, who will then be paid much more than the Senior Lenders. But, even assuming that TARP provides the Treasury Department with authority to provide funding to the Debtors and impose the transfer of collateral away from the Senior Lenders, TARP was enacted long after the Senior Lenders contracted with the Debtors and received senior liens on the Debtors’ property. Radford specifically disallowed the use of a law to retroactively alter existing liens on property.

God I hope this goes to the SCOTUS and I hope they strike TARP down as unconsitituional once and for all.

SCOTUS Problems?

Who do you think Obama will appoint to SCOTUS?

The first Hispanic? Asian? Openly Gay? A woman?

Or run of the mill old white liberal male?

Given that Souter has been one of the more liberal judges, even though he was appointed by Bush I, it could give Obama big headaches, since he has a host of special interest groups that will want their own kind of judge on the bench.