Rebane's Ruminations

OBAMACARE - The Left View

George Rebane

RR readers are very familiar with my thoughts on socialized medicine.  Here is a summary of how our friends on the left look at Obamacare.  This was forwarded by a correspondent and friend who views himself as a 'New Deal Democrat'.  I found the inclusion of Jesus Christ especially heartening.

Ten Terrible Things are happening since the Obama health care overhaul!
 
1. Most people will now have health care.
2. The insurance companies can no longer [have a Death Panel] deny people health care.
3. The insurance companies can no longer [have a Death Panel] cancel your insurance when you become ill.
4. Parents can keep their dependent children on their health insurance policy until they are 26.
5. Insurance companies will have to be accountable for increases in premiums.
6. Ceilings on annual or lifetime benefits will be eliminated. Also, people will be able to take their coverage with them if they leave a job.
7. Insurers will have to reveal how they spend premiums – how much is used to cover medical care vs. how much is spent on executive salaries and administration costs. They will have to pay at least 85% of individual plans on medical care.
8. The doughnut hole in the part “D” Medicare drug plan will eventually close.
9. We have always helped the people that don’t work or don’t want to work – now we will help the people who work and cannot afford to have health insurance.
10. Jesus would most certainly be for health care for everybody. Jesus would help those who can’t afford health care and so should we!

The insurance companies spent millions of dollars trying not to let this happen by advertising, spreading lies and buying off the GOP. It happened anyway and now we have to live with it. What is this world coming to? This is terrible?

Sucking on the Federal Tit, Teat, ... whatever

George Rebane

The picture of the deficits over the last eight years is a telling story.  The graphic shows the deficits with the cost of the Iraqi war broken out as tallied by the US government.  For those keeping up, we have to add the shown amounts to about another $3 trillion dollars to come up with the total federal budget.

 

Looking at the histogram, the effect of the Bush tax cuts is pretty clear.  Note that the costs of the surge needed to tip the balance and ‘win’ the war grew in 07 and 08.  And also note the size that the non-war deficit had achieved just before the ‘let ‘em all buy houses’ recession hit in 08.

The travesty of Obama’s non-stimulating stimulus programs in 09 and 10 are hard to miss (yes, some of 08 also included the TARP bailouts fashioned by the Democratic Congress and Bush).

With the White House filled with innumerates who can’t add without taking off both shoes, we are now extending the time that the one out of six Americans (and who knows how many illegals) can suck on the federal tit.  (Thanks to former Sen Alan Simpson for introducing the next level of explicit discourse into the national lexicon.)  Under Obama the federal budget now commands up to 25% of the nation’s GDP of which under 1% has been the cost of Iraq.  Servicing the national debt will soon eat up 25% of the federal budget – note that’s just the annual bamboozle so that the Chinese and Japanese will continue lending us money; it doesn’t pay off a penny of the principal amount we owe our creditors.  Is anyone paying attention to this???

Given the utter failure of the administration’s misplaced fiscal stimuli – during the ballyhooed ‘Summer of Recovery’ the unemployment rate will actually increase – the leftwing know-nothings are now talking about an even a bigger stimulus that is needed after ARRA and its recent add-ons run out.  ‘Hey, that was a pretty stupid thing we did, so let’s do it again.’  For a good cry in your beer, you can read ‘The Folly of Subsidizing Unemployment’ by Harvard’s Robert Barro.

Their big strategy is to continue giving money to the hand-to-mouthers so that the Dems can bag their votes, all without doing anything to give relief and reduce risk to the business owners who could create the jobs for the same people.  There isn’t a brain in the bunch smart enough to ask, let alone answer the question of ‘what comes after they spend the money we have given them this year?’  Answer to the slow of wit - the same thing that happened when the last tranche ran out without raising anything except future expectations for more hand-outs.

Something about giving someone a fish or getting a fishing job instead comes to mind.

Social Scaling

George Rebane

Another one of those delightful, disorganized, and sometimes disjointed discussions has erupted in the comments following ‘The Reverends Beck and Sharpton Hold Meetings’.  The topic area has migrated from that of the original post on the Beck/Sharpton rallies in Washington, to the related area of types of governance that were actually the underlying thrusts of both rallies.  In this piece I will attempt to address a couple of themes that have emerged from those comments.

One theme is that totalitarian governments can result from overzealous implementation of both collectivist and conservative approaches to governance.  I have energetically, if not always elegantly, argued that, yes, such may indeed be the endpoint from both starting points.  But by their very nature collectivist intentions (e.g. as represented by, say, progressive socialism) are far more prone to lead to the public’s demand for an authoritarian ‘man on a white horse’.  The prime cause for this is that collectivist economies have always depended on setting up altruistic commonses (a la Hardin) that eventually collapse and cause wholesale limiting of liberty and widespread misery.  It was ever thus.

While collectivist literature – from Marx to B.F Skinner (Walden Two) – has always extolled a social utopia at the end of the road, conservative/libertarians have never promised anything of the sort.  The most these so-called ‘right wingers’ promise the people is a fair run for the money and place in the sun, with no guarantees that any given person will find either.  But regardless, the argument continues that a strongly collective society will be the best that imperfect Man can deliver.  The Left promises ‘equal achievement’, and the Right strives for equal opportunity.  One side understands that freedom and equality are two sides of a see-saw, the other side promises to raise both ends without breaking the damn thing.

AB32 and Prop23 discussion on KVMR

George Rebane

This coming Wednesday from 6:20 to 7:00 pm KVMR-FM 89.5 will hold a moderated discussion of AB32, the attempt to suspend the remainder of the law through the passage of Proposition 23, and the relevance of the whole effort to us in Nevada County.  AB32 is also known as California’s ‘Global Warming Solutions Act’, ‘cap and trade’ law, ‘greenhouse gases act’, … .  This live program will be moderated by KVMR’s News Director Paul Emery.  The discussants will be Steven Frisch, President of the Sierra Business Council, and yours truly.

A more than thorough background on AB32/P23 can be found on these pages and on NC Media Watch (use keywords ‘AB32’ and ‘Proposition 23’ in the blogs’ search boxes).  Both Paul and Steve are RR readers and well-armed critics of the socio-political worldview I espouse, and my subsequent commentaries on happenings here, there, and everywhere.  Regular readers will correctly anticipate that Mr Frisch will continue his opposition to Prop23 and for the complete implementation of AB32, as will I continue my opposition to AB32 and for its suspension through passage of Prop23.

It should be an interesting exchange of point counter-point as Paul (who promises to be neutral) takes us through the hot-button factors that define this internationally followed energy and economy management legislation in which we find California again taking the ‘lead’.  KVMR welcomes pre-emailed questions from those planning to listen.  Paul asks that you kindly email them to [email protected] .  It would probably help the folks at the station if you use some pithy title like ‘AB32/P23 fracas’.

The Reverends Beck and Sharpton Hold Meetings

George Rebane

This morning’s gathering at Washington’s Lincoln Memorial was something to behold.  We had breakfast watching C-SPAN’s broadcast of the event that drew somewhere in the neighborhood of 400,000 people.  The occasion was definitely in the style of a revival meeting with unabashed appeals and praises to God and Jesus Christ.  Billed as an event to ‘Restore Honor’ in our country and pay respects to our military, its message appeared to resonate with those attending.

It was a peaceful crowd that applauded, cheered, sang, and prayed at the appropriate times as it was led by a number of dignitaries that included MLK’s niece, Dr Alveda King, and Sarah Palin.  The occasion was about as non-political as you can get and still have several hundred thousand people of mostly one socio-political ideology gather iconically at the nation’s capitol.  I think that Glenn Beck and team pulled it off in a fine fettle – I hope everyone left the place as clean as they did last time.

But what to me is most interesting of all, was Rev Al Sharpton’s counter-demonstration, and who all spoke there.  That gathered crowd numbered in the several thousand, and they definitely made the occasion into a Democratic (aka leftwing) rally.  Their prime point was that Beck and his masses were denigrating and co-opting MLK’s anniversary and message.  The main counter to Beck’s ‘It’s time we take back our country’ was ‘Well, it’s our country too, and you can’t have it back.’  That’s about as elevated as the dialogue got.

Maybe the most remarkable part of Sharpton’s ‘Restoring the Dream’ repartee was delivered by Sec Education Arne Duncan who correctly called education “the civil rights issue of our generation.”  The irony of Duncan’s call is that the blacks have been screwed, blued, and tattooed by the left-liberal education machine that, since the sixties, has put teachers’ unions first and minority students last (if they got to stand in line at all).

The folks gathered there to counter Beck had not a clue of what the Democrat supported unions and education policies from far-left academia have done, not only to three generations of their children, but to the country overall.  I agree with Duncan, once the state makes education a government run monopoly, plunders the nation’s pocketbook, and then delivers mush and pap in the classrooms instead of workplace-relevant education, then we all have had our civil rights violated.  And as always, that starts with and has greatest impact on the poor and ignorant segments of our minorities.

Unfortunately for us all, under the leadership of the Sharptons and Jacksons, that is not about to change any time soon.

Schwarzenegger on State Employee Pensions

George Rebane

California’s governor published a strong appeal for pension reform in the 27aug10 WSJ op-ed section.  In a piece titled ‘Public Pensions and Our Fiscal Future’ he lays out a case for why we are headed for disaster.  None of the arguments are foreign to regular RR readers.  They may come as a surprise though to those lefties claiming the “middle of the road”, and definitely to those of a hard list to port.  And specifically those who are of a strong opinion that all the past alarums posted here have been only from a fevered brain sequestered equally with theirs.

Let me begin with a pre-punch line, our governor flatly states that “government employee unions are the most powerful political forces in our state and largely control Democratic legislators.”  While this should come as no surprise to anyone who reads, it does explain away how the catastrophe has been catalyzed.  Willie Brown, that astute observer of the state’s political scene in which he formerly played a starring role, observed that “roughly 80 cents of every government dollar in California goes to employee compensation and benefits.”

Schwarzenegger makes the point that “spending on California’s state employees over the past decade rose at nearly three times the rate our revenues grew, crowding out programs of great importance to our citizens” that “include higher education, environmental protection, parks and recreation, … .”  This state of affairs has been difficult for the new hope and change students of socialism to pin on Bush, but God knows they’re still trying.

So here comes the punch line (actually punch line #1) – “Much bigger increases in employee costs are on the horizon. Thanks to huge unfunded pension and retirement health-care promises granted by past governments, and also to deceptive pension-fund accounting that understated liabilities and overstated future investment returns, California is now saddled with $550 billion of retirement debt.

The cost of servicing that debt has grown at a rate of more than 15% annually over the last decade. This year, retirement benefits—more than $6 billion—will exceed what the state is spending on higher education. Next year, retirement costs will rise another 15%. In fact, they are destined to grow so much faster than state revenues that they threaten to suck up the money for every other program in the state budget. (See the nearby chart.)”

Happy Days Are Here Again?

George Rebane

Nah, it’s just that November’s mid-term elections are finally getting close.  The big news hereabouts is that Nevada County received another tranche of federal cash from the vaunted American Redistribution and Re-election Act (ARRA).  Yes indeed, another $2.82 million and change rolled in this week.  This almost tripled our take so far.  We also applied for more monies from that trough (why shouldn’t we?), and were advised that we’re good for about another $6.5 million.  Please see the weekly chart and visit the county’s website for more info.

 

As predicted in these pages for over a year now, this cash has been set aside for exactly such a rainy day as the Dems are anticipating this November.  I expect a good portion of the approved monies to come in between now and election day, and the only stimulus it will provide is to stimulate you to vote for more tax and spend policies and politicians – ‘see we told you we’d get the Chinese to give, er lend you the money.’

Now before we go nuts and get drunk celebrating this weekend, we should put this little injection into perspective with some other economic data that came out recently.  Like start with today’s announcement that the country’s 2010Q2 GDP growth was not really 2.4% - itself anemic – but an even more sober 1.6%.  Unemployment in the private sector is flat, the only ones really adding jobs are government bureaus so that they can better tax and monitor us.  And, of course, we heard this week that after all this stimulus our county's unemployment went up.  Our trade deficits are going through the roof, and public service unions continue their compensation demands which have reached levels of mega-insanity (more on this in a later post).

Speaking of mega-insanity, here in California we’re hell bent on driving our economy into deep mud and take undisputed possession of last place in the Union.  But our socialist neighbors have it all figured out.  Turn the crank up on AB32’s cap and tax carbon provisions, and we can replicate Spain’s experience in creating subsidized ‘green jobs’ at the horrendous cost of destroying wealth creating jobs.  The dufus divisions in the state continue pointing to Sand Hill Rd venture capitalists investing in such projects as proof that everything is going to be OK.  They have not a clue as to how those people look at their investment risk in government mangled markets.  Anyone remember the great ride we had with Fannie and Freddie before the plug got pulled.

Exit question: Any bets that after 2011 the Great Recession will be renamed?

Dollar for dollar, you get chazzerai

George Rebane

A couple of nights ago Jo Ann and I attended an NID meeting of the Cement Hill Rd water project held at the Elks Lodge.  We sat with NID board member Nancy Weber who also spoke at the gathering.  The meeting was pretty much a waste of time for most of the attendees, nevertheless it again shed a little more light on the disaster we are digging deeper for ourselves.

It turns out that part of the CH project involves about 68 low income (out of 142 involved) parcels, and a $720K or so community development block grant (CDBG) that was supposed to be used to reduce their taxes through a federal affordable housing stipulation connected with the project.  Without boring you with the details, the bottom line is that HUD awarded the CDBG, and then after some months suddenly withdrew it.  Apparently one of the problems is that some HUD numbskull in San Francisco cannot understand that Nevada County and NID are not the same jurisdiction.  But I digress.

What really happened is that our county spent tons of staff hours preparing the work-up and application for this CDBG.  Then it was reviewed by everyone here in the hills.  Then it went to one of the big state buildings and bureaus in Sacramento where the state government types went through it and wrapped that application in their own application.  Then all the review up and down the line to make sure that it was OK.  Then they submitted to HUD in SF.

HUD, of course, did their bit on it with another few tons of staff hours to see that all applicable (and probably inapplicable) federal requirements were met.  Then they awarded the $720K block grant.

So after more months passed, and who knows how many more staff hours spent, HUD decided that the county had violated the provisions of the grant by starting the project without the appropriate mother-may-I, and the pulled the money.  Now everyone here is running around in circles attempting to convince HUD, in so many words, that they have their head stuck in the wrong place – the county doesn’t do any digging on this, it’s NID.  Well, you get the drill.

At that point into the presentation I asked what was the estimated number of staff hours expended in the processing and de-processing of this CDBG, and if the dollar cost of that total might handily exceed the $720K amount in play here.  This drew a nervous laugh from the audience until we all realized we ourselves were the target of the laughter.  The country staffer didn’t want to give a direct answer, but conceded that it was a plausible assumption.  And, dear reader, the beat goes on even as breathe – they’re all still huffing and puffing on this one while drawing full salary and benefits.

No RR reader thinks that these goings on are an anomaly.  It is the sad norm of a runaway government on steroids.  Before closing, I recall another little vignette that’ll frost your, …, well, you know.
 

Some Governance Druthers

George Rebane

California’s AB32 (cap n’ tax) controversy and the impending opportunity to suspend a good part of it through passage of Proposition 23 has given rise to discussions on better approaches to governance.  Here is a partial list of my druthers, some of which may even be doable, and, I’m sure, there’re one or two ‘you can’t get there from here’ in the collection.  As always, I invite a spirited discussion and critique.

1. Term-limits.  All elected offices, federal and states, would be term limited.  There would be no professional political ruling class.  Once your elected term ends, you must have a time out of at least four years before diving into the public trough again.
2. New Tax Code.  All income (not profits) of all federal tax-paying entities (individuals, institutions, businesses, …) get taxed at a flat rate, say 10%, right off the top.  No more government picking winners and losers; you want to bank or spend a dollar, then you’d better plan on taking in $1/0.90, or about $1.11.  States can set their own flat tax rates, not to exceed fed rate, as they see fit.  No more sales tax on anything.
3. Sunset laws.  All legislation will contain their sunset provisions.  Any legislation that requires extension or renewal will be subject to the same requirements as those that first put them into the book.
4. Dismantle Commons.  Cf. Garrett Hardin’s ‘The Tragedy of the Commons’.  For a commons to survive requires altruism from all of its consumers.  Government should identify and eliminate commons wherever it finds them, and substitute the personal responsibility of individuals for their continued husbanding and maintenance.
5. Single issue legislation.  No unrelated issues will be wrapped/bundled/hidden/etc in any one single piece of legislation.  Each unrelated issue will have to visibly stand or fall on its own.  Laws should include maximum use of graphics (e.g. influence factors diagrams and inter-process communications diagrams) to disambiguate their content, shorten their legalese prose, and make their implementation clear to all.  This should be viewed as part of the overall lawyer unemployment effort.
6. Two-thirds supermajority on all legislation involving government receipts and unbudgeted expenditures.  States included.
7. No more add-on fees for government services.  That’s what the flat tax is for.  If the government can’t afford to do it from their existing income, then don’t do it.  No more nickel and diming the taxpayer.
8. All government bodies will deliver timely budgets.  Any body (elected appointed) failing to meet budget deadline will be placed incommunicado and under house arrest with no pay until a budget is presented.  The sworn responsibility to the people comes first.
9. All peacetime budgets will be balanced; no deficit spending.
10. No offensive military operations outside our borders will be permitted without formal declaration of war.  Extended (say, beyond 30 days) defensive operations will require a pro-forma declaration of war.
11. Deadlocked legislatures will be issued a warning, and, say, after 30 days automatically  declared dysfunctional, and new elections held within 90 days of such declaration, after which the dysfunctional body is disbanded.  No member of a disbanded dysfunctional body may run for public office during the ensuing four year interval.

Steven Frisch responds on Proposition 23

George Rebane

On 20 August last, KVMR aired one of my bi-weekly commentaries ‘Is Prop23 Relevant to Nevada County?’ in which I argued 1) for the support of Proposition 23 to suspend CARB’s implementation of AB32 which is now California law, and 2) that the county’s Board of Supervisors should take a stand on the proposition.  Steven Frisch, President of the Sierra Business Council and RR reader, delivered a KVMR commentary tonight advising opposition to Proposition 23.  He kindly sent me a copy of the transcript of his commentary which is available here as received - Download Steven Frisch KVMR Prop 23 Commentary.  Paul Emery, KVMR news director, is planning a discussion of this proposition between the three of us.  The tentative schedule for its airing is 6:30pm on 1 September next.

Meg, are we in the bag?

George Rebane

Last Wednesday (18aug10) I stood next to my pal Russ Steele when he lit into Meg’s second string field representatives for her refusal to support Proposition 23.  I thought that Russ was appropriately steamed by the ‘pre-natal RINO’ behavior Whitman was communicating across California.  I had taken her to task on this in my 14aug10 Union column (here).

But then, like a dummy, I put my hand up to ask the team what information about California jobs and AB32’s effect on same did Whitman still need in order to throw her weight behind Prop23 to suspend AB32.  I didn’t have a chance, Russ’s incisive indictment had loosened whatever inhibitions might have been in place at that celebratory opening of the Republican campaign headquarters.

The follow-on questions and criticisms from the audience came unprompted, hot, and heavy.  After about a minute I quietly lowered my hand, hoping nobody had noticed such a silly attempt at wanting to be heard in that crowd.  More on the occasion was reported here and here.

The takeaway from the gathering left me pondering about Meg Whitman, the launch of her new career in politics, and what should be my response as a conservative voter with libertarian leanings.  The message to all of her conservative voters is clear – we are in the bag, and now it’s time to go scoop as many people as possible from the ‘decline to state’ and the left.  After all, what rightwinger in their right mind would abstain or vote for Governor Moonbeam?  Get serious.

Well, I am serious.  To me and many others, she has chosen to walk the well-worn path of political expediency – ‘just get me elected, and then trust me to do the right thing for you.’  The problem with that is that that’s the problem.  The halls of the electeds are full of yokels who were put there by us through exactly that kind of argument.  And now we are where we are.

Like so many across the land, I joined the Tea Party Patriots because I believe in a different approach to politics that starts and ends with principle.  And like so many, I admit to having trampled my beliefs by voting for candidates I knew to belong only to the ‘me first’ party.  How long must we; no, how long must I continue doing this?  Is this behavior not a form of insanity, doing the same thing and expecting different results?

Perhaps California needs to crash, and crash hard before we and the rest of the country wake up to the siren song of socialism.  And Governor Moonbeam is just the man at the helm to drive us into the mud about as quickly as anyone.  It may now be the time.

Having said all this, I invite Meg Whitman to bring her considerable talents back into the same circle of principle from which she launched her campaign.  I want her to show the world that she understands the condition of polity in today’s America, and will again stand loud and strong for the prescriptions that we believe will make the country better, the prescriptions that we all thought she believed in.

To put a bow on it, I don’t like being in the bag any more.

Bassackwards (updated)

George Rebane

Former Union editor and Nevada County’s journalist extraordinaire (also self-appointed manager of our morals and keeper of The High Dudgeon) Jeff Pelline has again gotten a bit confused about the why, wherefore, and responsibility of disclosures.  In my recent pieces promoting the passage of Proposition 23 (for example here and here), I do not mention that the Rebanes have contributed to Congressman Tom McClintock’s campaign – TomM, Dan Logue, Doug LaMalfa, and many other conservative politicians are also vocal proponents of Prop23.

On his blog and on RR Jeff has announced our financial support of McClintock in breathless revelations and the surety of a man who sees himself firmly in the footsteps of Woodward and Bernstein.  His attempt to communicate outrage at my implied desire to hide this contribution is not the first time he has shown ignorance about when and where such disclosures are needed.

Jo Ann and I support many charities, institutions, politicians, and initiatives.  And this invariably means that we also put our money where our mouths are – count on it.  On the obverse, we also take no monies or other remuneration to our benefit for promoting and supporting our beliefs and values.  In the case of Prop23, our hoped for benefit in its passage is that of almost all other Californians who are not members of the subsidy sucking sector.

What Pelline and other lightly read journalists seem to be ignorant of is that it is only those getting compensated for promoting views or causes who should declare their benefice and benefactors.  In short, if it looks like you’re spouting off because you’re getting paid for spouting off, you should then disclose it.

For example, every time George Soros states that he is for, say, a higher minimum wage, he has no obligation to concurrently declare that he gives monies to a host of listed organizations and lobbyists who are of a same mind about a higher minimum wage.  How he legally promotes his causes is his business, which someone else can discover and trumpet or not.  In the same vein, conservative columnist and commentator Charles Krauthammer has no obligation to disclose his contributions to recipients who also hold the same views he is promoting.

Another example of this kind of dumbbell journalism occurs when we hear of the efforts to build a better fence along our Mexican border as being akin to our building another Berlin Wall down there.  Such journalists have no idea how the Iron Curtain operated, or what was the intent and purpose of the Berlin Wall .  Of course, one can argue that these journalists do know their history, but then we must conclude that they’re evil instead of stupid.

I make no such assessment of Jeff Pelline, he just keeps getting things bassackward.

[update]  I meant to include a link to an appropriately clarifying essay that I posted almost three years ago about my thoughts on journalism today, my role as commentator, and a summary of belief tenets that anchor such views.  Please see 'I AM NOT A JOURNALIST'.

Is Prop23 Relevant to Nevada County?

George Rebane

[This is the transcript of my bi-weekly KVMR-FM 85.9 commentary aired earlier this evening (20 August 2010).  NC Media Watch adds to the relevancy argument here.]

By now everyone has heard of AB32, California’s new law to implement statewide energy cap and trade regulations.  Governor Schwarzenegger signed it and turned it over to the California Air Resources Board or CARB to implement through new regulations, bureaucracies, and fees levied on all levels of life in the Golden State.  The debate about its effect on the state’s economy, already heated before AB32 passed, now became torrid.

The wealth creating businesses and jurisdictions, with energy price sensitive economies, have analyzed and argued that AB32 would devastate an already ailing California economy, and further harm a business climate that puts California at or near the bottom of nationwide economic rankings.  But organizations and jurisdictions that hope for federal subsidies, and subsidy dependent investors hoping to create ‘green’ jobs, are the vocal proponents of larger government and increased taxes and fees that AB32 implementation would entail.  For good or ill, both sides are in solid agreement that AB32 would impact every facet of business and life in our state.

The battle lines were drawn when our Assemblyman Dan Logue introduced AB118 to suspend the implementation of most of AB32 until our 12.3% unemployment rate would come down again to a tolerable and more historical 5.5%.  Logue’s argument was that AB32, no matter how implemented, would be a serious drag on our economy, and to recover we needed less regulation and taxation, not more.  Many studies and analyses supported this argument.  But Logue’s bill failed in tax-and-spend Sacramento.  However, the public opposition to AB32 was overwhelming, enough to morph AB118 into Proposition 23 which we will all vote on in November.  Naturally, this started the pro/con Prop23 war, which brings us to the present.

Don’t worry your pretty little head

George Rebane

Imagine trying to land a 747 when all you can see is out the back where you have been.  This is pretty much the drill in attempting to manage a centrally controlled economy using financial performance data that is more than a day late and a dollar short.  Our socialist inclined friends always feel up to this challenge.  I was reminded of all this when a while back I did some research for my August column in The Union.  But there turned out to be more to it.

 

I introduced a graphic called the Regulatory Impact Curve (RIC) that allowed one to visualize how a government’s imposed regulatory burden affects the growth rate of its underlying economy.  Since the regulatory burden has recently been increasing at a gallop, both nationally and especially in California, I wanted to put a few dots on the RIC to show the relative locations of how recent growth rates have responded.  There should have been no problem getting this data since we have tens of thousands of public service employees in big buildings and bureaus across the land collecting, collating, and coagulating it all into information to be used by businesses and public policy makers.

I simply wanted the 2009 growth rate for California’s state gross domestic product (GDP).  It being August 2010, there should be no problem in going to some government website and copying down the number.  Wrong.  After almost an hour googling data service places that I didn’t even know existed on the web, I gave up.  I found the data for up to and including 2008, but that’s where the ‘actual’ stuff ended, and ‘estimates’ and ‘projections’ for 2009 and 2010 started.

Well, I didn’t really give up.  In my web wanderings I came across the name and phone number of the California Department of Finance.  These people would surely have this 2009 data at their finger tips.  I called and went through the usual byzantine ‘death by menu’ experience; I talked to four different individuals, all with fine sounding titles, none with the answer that I wanted.  A couple of them had to repeatedly ask me what exactly did I want, giving evidence that the main economic growth rate for the state was a notion beyond their ken (but then I remembered that government is the employer of last resort).

Stagnating Workforce

George Rebane

“New data show that fewer than 25% of 2010 graduates who took the ACT college-entrance exam possessed the academic skills necessary to pass entry-level courses, despite modest gains in college-readiness among U.S high-school students in the last few years.”  So opens a front page report in today’s (18aug10) WSJ.  ACT scores for high school graduates have been below acceptable levels for decades and have been dropping in recent years.

I have worried RR readers extensively on the portents of this persistent spread of national “dumbth” (a la Steve Allen).  We have already transited to an information and service economy, manufacturing forms an ever shrinking part of our employment base.  But where will we get such qualified workers when our schools continue to pump out graduates 40% of whom cannot understand what is on their diploma.

In this decade we are well on our way to half of our workforce (now over 155 million) not being able to sell their labor at wages that will maintain their quality of life.  The government continues to be the employer of last resort, and also the funder of last resort to organizations (e.g. NGOs) filled with people who will not make it in the private sector.  And this cohort of ‘workers’ is expected to enjoy robust growth in the coming decade as the planned increase of government takes effect under already passed and planned federal legislation.

Selecting the Right Business Climate

George Rebane

There are several approaches that a region or community can adopt to build a better business climate.   Every approach is founded on a social ideology that is promoted by its backers as a belief system that has either worked in the past, or one that will work in the future if only we give it a chance.  For example, California has made its selection clear, and it is sadly both unworkable and unsustainable.

Joseph Bast of the Heartland Institute has assembled a body of research on business climates that he summarizes into ten points of public policy for consideration by elected officials.  These are published in ‘Building a Better Business Climate’.  They all seem to be also supported by what I would call common sense.  But in today’s America common sense is no longer a common commodity in the minds of voters.

Policy point number ten is particularly important to smaller communities like Nevada County that have so much to offer to young families whose bread winners do good work with the stuff between their ears.  It is reproduced below in its entirety with my emphasis added.

10. Attract members of the creative class.  A final component of a good business climate is adopting policies that make cities and communities attractive to scientists, engineers, entrepreneurs, and other members of the so-called “creative class.” These individuals are sought after by companies, with the result that businesses will move to cities and regions where such individuals congregate.

Members of the creative class are younger than the average worker and seek cities with amenities that suit their lifestyles. They change jobs frequently and consequently prefer to live in cities with lots of job opportunities to avoid having to relocate. Creative people spend more time on outdoor recreation and view their cities the way tourists do, as a collection of places to visit to have fun.

Cities and states that keep these preferences in mind can avoid wasting millions of dollars on “economic development” schemes that target the wrong people or attempt to draw them to the wrong places.

In California our progressives are convinced beyond debate that implementation of AB32 will create new and productive green industries by government subsidy and regulatory diktat.   History has shown this approach to be another ‘road to serfdom’.  In November voters will have an opportunity with Prop23 to ‘suspend’ the fall of this executioner’s axe.  Russ Steele of NC Media Watch has the latest doings on Prop23 going on at the state’s Regional Council of Rural Counties meeting this week in Sacramento (here).

A Sackhead Saga

George Rebane

The comment threads of most online blogs can get pretty nasty and off the point – one part displays the person’s upbringing, and the other his ability to noodle about the subject, even if he’s a she.  Such remarks are fostered by the anonymity of online handles (or nom de screed) which commenters adopt when they really don’t want to stand behind their words, especially if these are snarky or silly.  In the past I have characterized such people as sackheads – showing up in a public forum wearing a paper sack with eyeholes to shout or shyly mumble their message.  While RR allows such comments, I and other online commentators encourage readers to engage each other civilly (churchilian repartees invited) under their own names.

RL ‘Bob’ Crabb, Nevada County’s keen observer of life’s foibles and cartoonist extraordinaire, captured the essence of the sackhead saga above in his regular offering that appeared in the 14aug10 Union and is used here with his kind permission.

Mr Crabb is also a published author whose latest book is Once Upon a Village.  He will be at the Nevada County Fair today 15 August from 2-5pm where you can buy your copy and get it signed.  Bob will also be at the NC California Organics outlet (behind the SPD at 135 Argall Way) on 28 August from 5–8pm to reprise the whole thing.  So you have two chances to get his newest tome of memorable cartoons immortalized.  Go ahead, make your day.

Prop 23 = AB32 Relief (updated 19aug2010)

George Rebane

[This is the submitted form of my August Union column which appeared in the newspaper’s 14aug2010 print and online editions.]

Almost all surveys, polls, and analyses say that California is at or near the bottom of America’s economic ladder.  Our perennially inept legislature in Sacramento has worldwide notoriety - we are the international poster child of how not to do it.  It? damned near anything related to public policy.  More and more economists and commentators see us on the threshold of a “failed state”.  Only the progressive elites, public service unions, and their local minions continue assuring us how more regulations and taxes are going to solve all of our problems.

The latest tumor metastasizing our Golden State was the passage of AB32, the claimed cure-all to man-made global warming.  This new law is causing untold grief to our state’s businesses with reams of new regulations already in force, and new ones being discovered and enforced every day.  Many businesses are escaping elsewhere as fast as they can.  Others are cancelling plans for growth, and laying off as many workers as possible to reduce costs as the storm approaches.

The malady has already hit Nevada County businesses like Robinson Enterprises and Hansen Brothers.  The only ones still baying for their bone from Washington are our legions of government funded NGOs and large corporations.  These have learned to play the ‘Washington game’ of preferential subsidies and competition stifling legislation that spells oligopoly.

   

To illustrate the general and broad-based effect of laws and regulations burdening businesses and our economy, I offer the above graphic.  It shows how piling on more reams of state mandates creates ‘friction’ in the growth of an economy.  The horizontal axis shows the amount of regulations enforced by government, and the vertical axis indicates the resulting growth rate of the economy that such regulations enable/inhibit.

It is clear that some modicum of regulations is needed to enforce contract law, protect consumers, and maintain the environment.  Without that an orderly society could not function.  However as we witness today, once we exceed that parsimonious set of laws and regulations, economic growth rate begins to go down.  Twentieth century autocracies have shown that growth rate can go negative leading to the collapse of the state.  This is described by the illustrated Regulatory Impact Curve (RIC), which in its naming, modesty prevented my following the lead of Art Laffer.

When we try to peg California on the RIC, the Legislative Analyst Office in Sacramento has pronounced AB32 to be a net cost to the state.  The LAO goes on to say that California Air Resources Board has done a poor job of analyzing the “economic leakage” that AB32 will cause.  This means that AB32 pushes California to the right and downward on the RIC as indicated.

The jobs lost to this bad law are now in the thousands, and for that reason our Assemblyman Dan Logue is spearheading passage of Proposition 23 on this November’s ballot.  Prop23 would delay the implementation of AB32 until California’s unemployment rate drops from its current 12+% to 5.5%.  A YES on Prop23 appears to be the least we can do to help ourselves during this Great Recession which has been more than mishandled from Washington, and now threatens to become a double dip disaster or worse.  We don’t need to make it worse in a state that is already scraping bottom.  (Prop23 info www.suspendab32.org/resources/ab-32/)

Of course, all this is lost on the left that continues screaming for higher taxes, more state control, and bigger government.  Their cry is loud enough to give second thoughts to established ‘middle of the road’ politicians who should know better.  It has even scared the pre-natal RINO Meg Whitman into opposing Prop23 with the caveat that once she’s governor – wink, wink – she’ll postpone AB32 for one year through an executive order.  That little ploy is designed to endear her to the left, and sweep up the innocents on the right.  Right.

Meanwhile, CABPRO and the Tea Party Patriots are the only local organizations so far to have thrown their weight on the side of Prop23.  Our electeds remain silent to sullen on the matter.  Nevertheless, Supervisor John Spencer will soon ask the BoS to endorse Prop23.   But business development outfits like the ERC are keeping mum.  Does this mean that we in Nevada County have pretty well pulled in our horns and mortgaged our future to ‘Chinese Cash from Washington’?  Exit question – and how long will that last?

George Rebane is a retired systems scientist and entrepreneur in Nevada County who regularly expands these and other themes on KVMR, NCTV, and Rebane’s Ruminations (www.georgerebane.com).

[Exit question #2] – Russ Steele at NC MediaWatch asks ‘What happens if Prop 23 fails?’

[18aug2010 update] - The future of California is clearly visible in Europe (here).

[19aug2010 update] - To once again illuminate the substance of loud, loutish, and shameless leftwing voices which are often found in these comment streams, please examine the US government data on recent California vs national GDP growth rates that the above RIC illustrates - US 0.7%, CA 0.4%.

 

Unbelievable? – maybe not (updated 17aug2010)

George Rebane

Progressives and their ambiguous cousins, the liberals, cannot be this ignorant.  Tonight on Fox News Neil Cavuto interviewed James Roosevelt Jr, FDR’s grandson and former associate commissioner of Social Security.  Junior, sober as a judge, claimed in front of a national audience that SS was completely solvent due to the Treasury bonds worth trillions squirreled away in its vaunted “lock box” – the one shown on PBS as a stack of computer printouts in a file cabinet.

It is remarkable that this individual is still walking the streets on his own recognizance.  Cavuto was careful in showing him deference while successfully fighting back giggles that tend to loosen and explosively expel all the phlegm accumulated in the back cavities of your nose.  Nevertheless, it was an extraordinary interview that maintained all previously established dignities.  But the ignorance displayed does require a bit more consideration – maybe we can look under the hood and see what is there.

Those Convenient Counterfactuals (updated)

George Rebane

Ahh, another glorious Friday, and an opportunity to continue the never-ending debate about President Obama’s series of stimulus packages that have done so much good in this recession, the good that would have gone by the board had not Congress bent to the man’s progressive instincts and Keynesian prescriptions.

 

Here again we see the weekly update of the contribution to Nevada County afforded by the now (in)famous American Redistribution and Re-election Act of 2009 – better known as ARRA.  The monies from this national commons has drizzled down into the nooks and crannies of our country, directed to places, people, and projects where it will do the most good for the ruling class.  But the discernible effects of ARRA have been varied and very debatable.

That ARRA has been a just-in-time blessing for America is touted by no less than the President himself.  Starting in the marbled halls beside the Potomac, the orchestrated cry has rippled down through state capitals and city halls large and small, all the way to remote mountain counties harboring gratefully funded NGOs and the occasional stretch of road or bridge in disrepair.

ARRA’s skeptics have spent the last year or so looking for the benefits of this federal largesse.  They’ve looked at job statistics, trade balances, unemployment numbers, etc without much success in finding the blessings from this new mortgage on the country’s economy.  And as a result, you’d think ARRA’s promoters and true believers would be in shame and disarray.  Don’t let the thought enter your head.

The benefits of ARRA are right there in front of your eyes, you just have to know where to believe.  The skeptics are tagged daily in the media as reactionary knuckledraggers to whom it must explained over and over again that if we had not stimulated with ARRA, then this, that, or the other horrible thing would have happened.  And having now spent the borrowed Asian yen and yuan, voila!, the bad stuff didn’t happen.  What more proof could a reasonable person want?

In systems science such arguments are known as counterfactual conditionals, or simply counterfactuals.  Their use in reasoning, especially about causality, is an important part of leading edge developments in both philosophy and machine intelligence.  To understand them, consider first another kind of conditional – the indicative conditional.  The indicative could be something as bland and tautological as ‘If it did not rain this morning, we would have had some other kind of weather.’ – an obviously true statement.

An example of a counterfactual is ‘If it had not rained this morning, then it would have snowed instead.’  Well, the fact is that it did rain this morning, and it is not certain at all that the alternative to rain would have been snow.  It could have been sleet, hail, clear skies, or … .  A counterfactual is not a reliably true statement, it is a chancy statement at best – at best there may be a measurable probability that the statement would have been true, and that’s all.

So now we understand the blather that comes from Washington and from local jurisdictions and NGOs about the effects of ARRA – ‘If we had not passed ARRA, then two (or three or four or …) million more jobs would have been lost.’  Bull pucky is about all we can sprinkle on such arguments.  No one has made a case for such claims, especially now that we’re seeing the economy continue to struggle and sag.  With at least equal validity one could claim, ‘If we had not passed ARRA, then the recession would now be over.’   (I’ll call that the von Mises argument.)

And claims of how much ARRA money actually has landed in the bounds of Nevada County, and what the greater tragedy would have been had Nevada County not received such stipulated funds, are somewhat beyond comedy.  And the mirth is multiplied by the serious demeanor with which Obama’s local progressives portray the “truth” of their claims, and ascribe all other representations, no matter how qualified and official their source, as “lies”.  The twilight of reason.

[update] A correspondent and RR reader from the Washington area sent this August 2010 DOE Inspector General's report on the progress from its distribution of ARRA funds.  Recommended reading for a dose of high government comedy.  But when you stop laughing, you might want to have your hanky ready for the tears you will then shed for our country and your wallet.

Pincer Movement (updated 15aug2010)

George Rebane

The news outlets today are buzzing with the latest report from the Pew Hispanic Center that one out of twelve births in America are to fugitive illegal entrants.  According to the now established interpretation of the 14th Amendment, these babies automatically become bona fide American citizens upon post-partum.  Achieving 21 years of age they can start sponsoring family members from south of the border.

Meanwhile, the decadal census, which is supposed to determine representation in Congress, does not ask the immigration status of its respondents.  Therefore outfits like Pew and various government agencies must jump through statistical hoops to arrive at the currently accepted 12 million figure for illegals in the country.

Hispanic birthrates are the highest in the land.  The US Census Bureau estimates that in 2050 almost one quarter of the US population will be Hispanic.  Organizations like La Raza and MALDEF are celebrating such news as a continuing vindication of Reconquista progress.  Hispanic leaders in America (some in Congress) have for years made open public statements to cheering crowds that Aztlan - the American southwest of 1848 - will be theirs again through a bloodless conquest.  And if not that, then a bloody one will do.  Given the porous borders, anti-assimilation pressures, and today’s happy news of births to illegals, these prognostications are right on schedule.  (More here and RR search 'reconquista')

Then looking at the other coast, we are reminded that an even a greater invasion is being prepared from the east.  The American Muslim community has regained the temerity to plow ahead with the giant Cordoba House mosque within a few hundred feet of where Islam unequivocally declared its intention toward our civilization.  They know what they are doing, but we don’t.  We are instead practicing tolerance toward our invaders in the same spirit that we have always practiced tolerance toward welcomed minorities who come here to become part of the greater us.

Even their chosen name for the mosque is a triumphant telling to Islamic peoples all over the world.  By the end of the eighth century, the Caliphate of Cordoba covered most of the Iberian peninsula of what today is Spain and Portugal.  The city of Cordoba itself was the jewel of Islam’s progress to conquer Europe.  Cordoba’s population achieved 500,000 while Paris had yet to reach 40,000.  To Muslim’s everywhere ‘Cordoba’ is a battle cry of the Global Caliphate renewed, and that mosque will tell all that the final thrust into the heart of ‘The Great Satan’ is beginning.

Obsolete Obama?

George Rebane

Have you noticed how Democrat candidates across the land have been nowhere in sight when President Obama swings through their neighborhoods?  It may have something to do with his plummeted approval ratings, or that the nation is beginning to take a second look at the fast track to EU socialism he has laid out for us, or … .

Fouad Ajami,  professor at the Johns Hopkins School of Advanced International Studies and a senior fellow at the Hoover Institution, is one of the most astute observers of the international scene, and has published a series of cogent and on-the-mark analyses of the American scene of the past several years.  Today he continues with the 11aug10 WSJ piece ‘The Obsolescence of Barack Obama’.

The magic is definitely gone - “A broken link with the public, and a war in Afghanistan he neither embraces and sells to his party nor abandons—this is a time of puzzlement for President Obama. His fall from political grace has been as swift as his rise a handful of years ago. He had been hot political property in 2006 and, of course, in 2008. But now he will campaign for his party's 2010 candidates from afar, holding fund raisers but not hitting the campaign trail in most of the contested races. Those mass rallies of Obama frenzy are surely of the past.”

Duck!

George Rebane

Our sun is going through a gastric upset and belching some pretty big stuff in our direction.  The belches are actually Coronal Mass Ejections (CMEs) of high densities of charged particles that are many times stronger than the normal solar wind which the sun constantly blows outward.  Most of the solar wind is deflected by earth’s magnetic field, so that only a little of it gets through now and then to impact our electro-magnetic communications.

But currently sunspot region 1093 (yes, they number these puppies so they can track them) is belching and coming around in our direction.  On 7 August it belched a huge mass that is hurtling past earth today (like right now) with only a minor impact on our goings on.  But as the sun rotates,  ol’ 1093 is getting better aligned with us in the next couple of days, and probably getting ready to let go with another big one that could be headed straight for us.

Spaceweather.com reports that a “major solar storm could cause 20 times more economic damage than Hurricane Katrina, warned the National Academy of Sciences in a 2008 report, 'Severe Space Weather Events—Societal and Economic Impacts'.  Smart power grids, GPS navigation, air travel, financial services, and emergency radio communications can all be knocked out by intense solar activity.”

Here on earth we sometimes pump ourselves up a bit too much as we take credit for causing big changes in how this magnificent system operates.  When we consider major volcanic eruptions, high energy cosmic rays, the sun’s activity, etc - what really impacts our environment – compared to our relatively minor wiggles on this planet, we should be humbled.

Competition or Corrupt Coddling

George Rebane

Even the left-of-center Economist, “the world’s oldest newspaper”, is beginning to see the light as governments take over huge hunks of their countries’ wealth generating capacity.  In its 7-13aug10 issue (‘Leviathan Inc’ and figure) it features a thorough analysis of governments worldwide grabbing control of industry after industry in a hopeless hope to stem the tide of red ink that paints their budgets.  The Economist concludes that the sucking sound of disappearing American jobs “comes from the tentacles of the state, reaching into more and more areas of business in an effort to get the economy moving.  It is the sound of Leviathan Inc.”

In countries where the state owns controlling interest in large and growing companies, the Economist points out that this success is not due to any state wisdom, but merely that these autocratic governments have now started loosening their grip on industry, enterprise, and profit.  We, with dunce caps firmly in place, never see in the comparisons that we are heading south while they are heading north.

Here we engage in both the mega-stupid and the mini-stupid.  The mortgage lending market is a poster child of the former where all the world knows the role that government guaranteed and goaded Freddie and Fannie played in getting us into the current recession.  Yet our government again evinced idiocy in its latest financial reform act – it totally ignored the devastation that Fannie and Freddie caused and continues to this day.  This “illustrates both the perils of state meddling (implicit state guarantees distorted the mortgage market with fatal consequences) and the difficulty of giving it up; having rescued the pair, the federal government lacks any plan to pull out.”

Singularity Signposts – 9aug2010

George Rebane

New advances in walking and evolving intelligence.

Today we’re a lot closer to robots walking naturally, and maybe tomorrow we’ll add the concurrent ability to chew gum.  A team of systems engineers heavy in six-degree-of-freedom kinematics and control theory has developed a totally new paradigm for robot locomotion that gets closer to how, say, we humans walk and move things using our hands.  They have demonstrated their new control algorithms in virtual robots and other body-type critters (here).

The basic approach is opposite from how robot controllers have been designed to date.  Instead of figuring out and even optimizing how each limb segment is controlled in concert with other body parts when something like walking or stair climbing occurs, the Toronto team designed the ‘system’ by specifying what kind of constrained motions and actions are possible for each body component relative to the position/motion of neighboring components.  They then developed a higher level controller that ‘managed’ the location and motion of the end components, say, feet in walking, while letting the other body parts do what they must to support the desired placement of the end components (feet) in such a way that the entire body would stay upright and not topple over.

What emerged (recall that complex systems have emergent behaviors) for a humanoid robot was a natural walking gait that even included the natural cross extensor reflex of opposite swinging arms.  The result, as you can see in the video, is a totally cool and naturally moving virtual robot.  BTW, you can compare this with the earlier and still ongoing work on the Big and Little Dog walking robots here.

The near-term applications of this are manifold – better looking computer games, realistic animated movies, and, of course, realworld 3D robots that will be better able to do the jobs formerly reserved for humans.  This includes all kinds of dangerous work like maintenance spacewalks, mining, disaster rescue, and maybe even combat.  My own favorite is the reprise of long-dead actors starring in new movies and TV shows.  For you older folks, consider seeing a forever young Elizabeth Taylor reprising her classic character roles in new screen plays.  Or seeing the development of new and realistic virtual stars who will perform in new movies for as long as the audiences accept them.  No more having to dress someone up and record them in a skin-tight suit with lights so that they can supply the natural motion ‘body’ for a computer generated film.

Artificial life forms are evolving basic intelligence.  Some significant steps have been demonstrated in the evolution of artificial life, or more specifically, artificial intelligence.  RR readers may recall that I am a strong proponent of the notion that human peer intelligence will evolve as opposed to being programmed into some final functional form.