Talking Out of Your @ss 101

[As usual, click to enlarge]

Want to know why our higher education system is such a mess? I present to you Professor Brent Terry at Eastern Connecticut State University (ECSU)… I did want to make sure I properly credited the college (that’s Eastern Connecticut State University or ECSU) even through they take absolutely no responsibility for anything said in their classrooms what-so-ever.

The funny thing is its conservative responses to morons like this that the left uses to paint us as anti-intellectual, and anti-education. [Eyes rolling]

As a followup, Brent did apologize for the statement… but what do you want to bet this isn’t the first time he’s done something like this or that it will not be the last time?

We need diversity (intellectual diversity) on college campuses; but that would mean releasing (firing) half the current faculty (practically all leftist) to make room for conservatives.

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Looters

They actually did it. Well, sort of. Facing mobs in the streets (as well they should); the Cyprus government, the European Union (EU), and the International Monetary Fund (IMF), looted billions (of euros) from the state owned Cyprus banks this weekend (3/25/2013)

So what exactly happened? I like bullet points (Type A Analytical), so let’s go with that.
1. Cyprus is a European Socialist Democracy run by leftist. Thus spending has never really matched income.
2. This system eventually collapsed; just like every system that mirrors it will (are you getting this EU and US?)
3. Cyprus is just ahead of the rest of the EU so they are seeking a “bailout” from their “not there yet” cousins; namely Germany. Italy and Spain can’t really help because they are just a few steps behind Cyprus.
4. The EU (mostly Germany) and the IMF have demanded that Cyprus pony up some money in exchange for the €10 billion in bailout funds. Recently they got specific and demanded that Cyprus raise this money (about €5 billion) by raiding Cyprus banks.
5. Conveniently or by design all this crap just happened to come down during a week-long “bank holiday”; making it impossible for people to withdraw lots of money. The Cyprus government used this as an opportunity (“never let a serious crisis go to waste” after all) to limit daily withdrawals to 100 euros. The peasants could still go crazy after all and need to be protected from themselves. Oh, and the government made it impossible to transfer accounts anywhere; basically telling foreign depositors “WE have your money and WE will decide how much of it you get back.”
6. The Cyprus Government floated the idea of “taxing” ALL accounts about 6-10%; which is what it would take to raise the demanded €5 billion.
7. This idea didn’t go well with the Cyprus citizens (also known as peasants). So the Cyprus Government instead decided to NOT tax the peasants (they are local and have pitchforks); but instead tax just “the rich”; who have fewer pitchforks and many of whom are not local. (Victims with pitchforks thousands of miles away are a good thing in the eyes of those who are doing the robbing.) But because the looters aren’t spreading the pain; the percentage “tax” on each account affected will be more in the 40% range (the government estimates 30% so I assume 40-50) for confiscation. “An EU spokesman said NO across-the-board levy or tax would be imposed on deposits in Cypriot banks, although the hit on large account holders in the two biggest banks is likely to be far greater than initially planned. A first attempt at a deal last week collapsed when the Cypriot parliament rejected a proposed levy on all deposits.” – Reuters
8. This scheme made the EU and IMF happy (they got the concession), and the peasants happy (they kept their money and their bread and circuses). The only few people who are mad are a few rich people in Cyprus and a lot of rich Russians who are far, far away.
9. Problem solved. Well, kind of… Cyprus is still a Socialist Democracy run by leftist… so it’s really just a band-aid. But why squabble over semantics?

Some Thoughts on the Whole Mess:
Placating the Masses
This really seems to have worked as far as placating the Cyprus peasants. “Many in the capital appeared intent on enjoying a sunny holiday morning, drinking coffee at pavement cafes and watching camera crews filming people drawing money from bank machines.” – Reuters

I’m also sure the bread and circuses have not abated in the least.

Inevitable
Make no mistake about it, the Cyprus banking system would have collapsed without a deal of a bailout from the EU or the IMF.

“It is a bad deal, but the extreme scenario we had to contend with was worse.” — Lefteris Christoforou, vice-chairman of the ruling Democratic Rally party

Guess what. It’s still inevitable. When you subsidize bad behavior (socialist deficit spending), even with stolen money you get more of that behavior.

Thieves Stealing from Thieves
“There is no honor among thieves.” Much (though not all) of the money looted was taken from Russian mafia oligarchs. As Charles Krauthammer said “It couldn’t have happened to a nicer bunch of people.” But we (Charles and I) know this was just coincidence. Had the money been the lifesaving of little old ladies from Peoria, it would have been just as gone, just a quickly.

Why Stop There
Cyprus was a “safe haven” for the foreign (Russian) money; kind of like the Cayman Islands are for American money. My question is why did the Greeks/Cyprus stop there? Why not take ALL of it or 90% or 80%? Why so little?

Do they think the Russians (and the rich) will just say “Man, what a rip.” And leave what remains of their deposits within the clutches of those who just robbed them? Of course not, they will transfer every cent as soon as they are able.

To get this deal, Cyprus has sacrificed its foreign banking industry. It will never recover. I’m just asking was €4 or €5 billion worth it when they just as easily could have taken €10 billion? It’s not as if those being “taxed” had ANY say in the matter or the amount.

The answer to my question “Why Stop There?” is, of course, they stopped at the point where they rationalized they could get away with it… without Russian missiles streaming in or Russian tanks rolling down the streets. Vladimir Putin does have his limits. Just ask his enemies… well those not poisoned or dead under mysterious circumstances. 🙂

Who’s Next
Spain and Italy are just a step or two behind Cyprus. Those guys are in terrible, terrible shape.

So I ask you… If you had any amount of money in Spainish or Italian banks; would you leave it there? I wouldn’t.

Sure, other European banks are fine (for now); and the same can be said for U.S. banks… so do we have nothing to worry about?

Conclusion
This is stuff that could have easily been in “Atlas Shrugged”; and it’s why that book is so relevant to today’s society. The looters as depicted in that book are alive, well, and active in Europe. They bide their time here (in the U.S.).

Many on the left will say that this could “never” happen here. By “never” they mean today… and they are wrong.

It is already happening here; jut much, much more subtlety. Every time Ben Bernanke prints another dollar (and he’s printing billions of them) he IS in effect devaluing the dollars we own to finance big leftist government. It is, in all practical purposes, the same thing. He’s just boiling the frog (us) slower.

But could we ever reach a point where our creditors demand that our government “tax” deposits, or savings accounts, or retirement accounts, etc… OR they will not lend us any more money? Could you see China doing that? I sure could.

But could you see the government (currently run by leftist with the same mentality as those in Europe) actually doing that… not all of us… just the rich? Yep! They would do it and the people would let them. Even today the propaganda has convinced us that those evil rich bastards deserve it.

No; it’s not going to happen literally tomorrow; but tomorrow as in within a decade? It could easily happen here; and it’s the direction we are headed at a dead run.

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Sequester – A Very Bad Idea – Whose Time Has Come

Sequester! SEQUESTER! Run for the hills! Wait! Don’t forget to set your hair on fire first! OK! NOW GO! RUN LIKE THE WIND! And don’t forget to scream you burnin’ little head off!

The Spin of Doom (Appearance):
Today (March 1, 2013) we will have automatic budget cuts across the board to the tune of $1.2 TRILLION. Jobs to be lost are upwards to 700,000 by some (liberal) estimates. And not just any jobs. Obama has announced it will affect teachers, police, firemen… he held a dog and pony show in the midst of “first responders” who would be cut due to this travesty. Now his troops are repeating these statistics of doom. Pink slips and notices are being handed out as I write this. And let’s not forget that the economy (slowly recovering according to liberals) will be hurt; horribly. This may even fling us back into a recession.

Quotes of Doom:

“Emergency responders like the ones who are here today — their ability to help communities respond to and recover from disasters will be degraded. Border Patrol agents will see their hours reduced. FBI agents will be furloughed. Federal prosecutors will have to close cases and let criminals go.” — President Barack Obama (February 19)

“It will harm the tens of thousands of children who would be thrown off of Head Start. It will harm children who depend on mental health services, seniors who depend on services. It will harm first responders across the country who will get furlough notices or layoff notices, teachers and the like.” — White House Press Secretary Jay Carney.

[Sequestration] “won’t consider whether we’re cutting some bloated program that has outlived its usefulness, or a vital service that Americans depend on every single day. It doesn’t make those distinctions.” — President Barack Obama

Yes… people aren’t really listening. Perhaps the President (and the left) have cried wolf one too many times.

The Truth (Substance):
That $1.2 Trillion is over TEN YEARS. This year’s portion is about $85 Billion. [Texas Lynn Note: Notice that $1.2 Trillion divided by 10 is $120 Billion. Surprise! Surprise! The cuts are weighted way into the future. But we keep hearing it’s spread out evenly.] And of course that $85 Billion is split between domestic and military ($44 Billion each).

Politicians (especially those who push the gravy train) like these big numbers because your average (uninformed) citizen and voter can’t get their heads around them. But here’s an attempt to clarify just how little the cuts from sequestration are:

Facts:
1. Total cuts this year (that Obama is throwing a fit over) is $85 Billion (half domestic and half defense)
2. Because of the constant growth of government, the cuts are equivalent to cutting spending to 2011 levels (and remember how things collapsed back then)
3. The federal government spends $11 Billion a day. So that’s 8 days’ worth of spending.
4. Don’t forget that even though we spend $11 Billion a day. We take in $5 Billion a day and borrow $6 Billion a day.
5. Uncle Ben Bernanke PRINTS as much money as will be cut in sequester (over ten years) in ONE MONTH.
6. Some programs are of course excluded from cuts, including Social Security, federal retirement payments, veterans compensation, Medicaid, Pell Grants, food stamps, Supplemental Security Income, veteran’s health programs, etc…
7. Military personnel? Our fighting men and women? Sequestration will have no effect.

Obamas Political Plan:
I’m not sure of the total purpose of Obama’s shows and rhetoric. He definitely wants to blame the Republicans for any hardship this may cause; and his lap dogs in the Main Stream Media will oblige him in that.

He may be hoping to get the Republicans to give him more discretion on the cuts or more likely to cave on the cuts altogether. The spin mentions moderation and compromise every other breath. But recent history shows that Obama firmly believes in the liberal definition of moderation and compromise being conservative surrender and capitulation. Enough is enough…

Hopefully the Republicans won’t do even discuss it with Obama. Which means they (the Republicans) are screwed in the blame game. But they’re screwed no matter what they do. They WILL be blamed for the cuts and the consequences; but at least the badly needed cuts will happen (even though they will not happen the way they should). This way they get SOMETHING for the price they are going to pay anyway. “Compromise” with Obama would mean no cuts, higher taxes, and “you get nothing, I get that for free” in return.

Dog and Pony Shows:
As for the shows themselves; they range from exaggerations to out-right lies. But in this day and age… deception is King and Obama has the upper hand in that regard.

So for the rest of February well see parades of people who will lose their jobs… shipyards that won’t build ships… and cats and dogs raining from the skies.

My Opinion:
Sequestration is a bad idea. It isn’t a terrible one, but it’s a very bad idea whose time has come.

Why is it bad:
1. It proves government (Congress & Obama) lack the cojones to really address the problem.
2. It cuts (to a limited extent) indiscriminately when we really should be concentrating on the waste; the massive, massive waste AND the “entitlements” that aren’t even in the equation.
3. And the main reason it’s bad is… It is WAY too small. It doesn’t even come close to cutting enough. The cuts should be about 7 times what they are and that amount should be applied YEARLY in order to balance the budget and have enough of a surplus to address the debt.

We are nowhere near that today… nor will we ever be again until it’s too late and all this crap collapses around our collective heads. Sequestration isn’t really a solution or even a step in the right direction so much as another sign that there is no hope. You understand? Financially, we are doomed as a nation. And we deserve it. Our children (posterity) who will really pay the price? Not so much…

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Gone, Gone, Gone!

Federal Reserve Chairman Ben Bernanke has to be a smart man. He has to know. Which brings up the question of why?

Bernanke has used his position to:
1. Lower the interest rates to 0.
2. Print butt-loads of money. We’re talking tractor trailers full of 100 dollar bills.
3. Use butt-loads of money to buy treasury bills (US debt). Last year we printed money and and used it to buy 60% of the government debt.

The above process is called “Quantitative Easing” or “QE” for short. It’s probably called that because “Printing Money” doesn’t sound as good. And isn’t it funny and sheer coincidence that the media doesn’t “report” on what QE really is. This is, by the way, the third time Bernanke has implemented Quantitative Easing. I guess he figures if he didn’t get the desired results the first two times; then third time is the charm…

Ben Bernanke’s actions have had the following effects:
1. Low interest rates that especially hurt people on fixed incomes (like senior citizens).
2. More national debt. Trillions more national debt.
3. Little profit to be made from treasury bills. So go invest elsewhere says Ben.
4. A lot of capitol sitting in banks or land or other safe investments. Bernanke wanted that money (not chasing treasury bills) to flow from banks in the form of loans; but the banks haven’t been that foolish. When it comes down to it; the recession was caused by too much lending to people who wouldn’t afford the loans. Banks and investors aren’t eager to repeat that fiasco; despite Bernanke’s wishes and goading.
5. Investors have at least turned to stocks as a place to put some of their money; so Bernanke’s efforts weren’t completely wasted (in his and Obama’s mind).

So we have a Dow Jones industrial average that is artificially inflated to 13,500; just 500 short of its all-time high. Many experts estimate that if investors looked just at the returns and company fundamentals the stock market should be at 9,000.

It’s all a bubble and like every bubble, it’s time is coming. And like every bubble it’s deflation could be managed instead of having an abrupt burst. Unfortunately, everything Bernanke is doing is designed to keep the bubble inflated until that eventual pop.

The thing is Bernanke is a smart man. He has to know all of this; and thus his actions and their results must be intentional, even calculated. So, Why? I can only think of one possible reason. Getting us, and the bubble, past the November elections and to help Obama’s chances at re-election.

So we know Bernanke is doing everything he shouldn’t in order to create an appearance of fiscal stability; especially in the stock market. Can this facade last another few weeks? I don’t see why not; having last several years now. But all of that appearance will come at a price to the substance sooner or later.

To attack the substance of the problem we should do the following:
1. Give small businesses (all businesses really) stable tax and regulatory expectations… so they can plan and possibly include hiring in that plan.
2. We need logical and responsible spending; not gimmicks that expire in a few years and create more uncertainty.
3. We need a monitory policy based on simply curbing inflation and protecting the value of the dollar; and not political cronyism.

In summary we need everything that defines Obama and Ben Bernanke gone, gone, gone! Our economy and probably the very future of this nation depends on it.

(Click to Enlarge)

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Robbing Peter to Pay Paul, the Allegory

Often global situations can be better explained using an allegory. Here is my attempt at explaining the financial crisis in Greece, coming soon to Europe, and a little later to in the U.S.

When you (the government) rob Peter (the rich) to pay Paul (the unions/looters), you can always count on Pauls support… as long as the payments keep coming. But when Peter has finally been tapped dry, or run off, and you have no way of paying Paul, you’ve got problems.

Paul has grown accustomed to the years of swag and has been looking forward to the future years of swag you have promised. After all, he kept his end of the bargain, by keeping you in power despite Peter’s protests’ over the years. Now, even mentioning the possible decline in swag, causes Paul to throw a hissy-fit, rioting, burning down buildings, and killing people.

The whole things get you (the government) to asking yourself…
■ Why couldn’t or wouldn’t that bastard Peter keep the gravy train rolling?
■ What’s up with Paul? He used to be so cool!
■ Who could have foreseen spending more than you take in would have been a problem?
■ What’s with the terms on getting a family loan? You’d think we didn’t start Western civilization of something?
■ Wait a minute!!! Can I blame someone else… get them to pay… someone with swag…???

Those (%$&*@#) American banks!!!

— Larry Elder (a conservative columnist) quoting the original Peter/Paul analogy gave me the idea for this post. Thanks man.
— “looters” is a Randian (Ayn Rand) term for those who take without contributing.

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Removing the Speck of Socialism from Greece’s Eye

Planks of Socialism

A lot has been said about the Greek financial situation.

I heard a commentator the other day; put all this into perspective. Greece is the General Motors of Europe. When times were good they sold their souls and future prosperity to the unions. They plowed head long into socialism and never looked back.

Socialism is an appealing concept. It paints a beautiful picture of society where men work according to their means; and take according to their need. Who could be against that? Those with a modicum of common sense, that’s who. It is simple common sense that exposes socialism to be a unachievable myth that requires the gullable to suspend belief in basic laws of nature (specifically human nature).

Socialism would be a harmless myth (like the idea of a perpetual motion machine) if not for the real world consequences suffered from trying to implement it. Socialism always collapses upon itself into impoverishment, and tyranny. Greece, unfortunately, has reached that transition period in the socialism cycle, with several other countries (Spain & Portugal) close on its heels.

As a condition of a bailout, Europe is demanding that Greece implement some free-market reforms; like privatizing their government health-care system (oh the irony), reducing government wages & pensions, and others. The unions (bastions of socialism) are literally up in arms; upset that the good times are over. They offer no solutions, knowing only that someone is trying to dictate terms that take from them the promises made by socialism. They either do not realize or do not care that they are simply reaping what they have sewn.

On this side of the pond, we debate on what to do. Simply put, the U.S. should not bail out Greece of any other European nation. Bailing out and subsidizing a system guaranteed to eventually fail does no one any favors. Yes the markets are closely tied. Yes, there will be pain on our side; but let those who made the mistakes pay for the mistakes. It’s how they learn, grow and eventually return to prosperity.

Bailing out Greece, and eventually most of Europe, will not encourage the reform needed to fix their long term problems. Specifically, it will not force Europe to abandon socialism. Instead, we (the U.S.) should concentrate on correcting our own mistakes (Obamacare, deficit spending, bailouts, big government bureaucracies, etc…), akin to those that led our European brothers to such ruin. In essence, we the U.S. should find a nice quiet corner and concentrate on removing the beam/plank of socialism from our own eye.

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