Monday, December 15, 2014

Elizabeth Warren Is Only A Distraction For Hillary

The political pundits advising Hillary to move to the left in order to pre-empt a threat from Elizabeth Warren have it wrong. It is questionable if such a move will gain her any votes, but it is unnecessary to win the primary and will hurt her in the general election. In 2004 Howard Dean had the same crowd of radical leftist groups like backing him. Up until the actual voting he polled great. Of course once the battle began he crashed and burned, losing to the more "centrist" candidate John Kerry.

In 2008 Obama started with the same supporters as Dean, but he won. There was one major and telling difference. Black voters represent about 25% of Democratic primary voters. and traditionally the vote is divided. Obama entered the primary and true to form it remained divided because no one thought he had a chance of winning. But once he won in Iowa, people realized he could win the nomination and the entire black community lined up behind him. Hillary would have won in a landslide absent the black vote, and would have won decisively had the black vote been divided. In 2016 the it will be divided, and Hillary will win the nomination easily. After all, wasn't Bill Clinton "the first black president"?  

Friday, April 25, 2014

Larry Summers; Wrong Again

The supposed mainstream economists have absolutely no idea about what macro economic forces causes what. There is no logic to what they say and a complete ignorance of economic history.

This morning prior to an Export Import Bank meeting, Larry Summers, former Treasury Secretary, President of Harvard University and lifelong darling of leftist economists, was on Bloomberg TV discussing economic policy. I can’t quote him exactly but here is the gist of what he said. Export Import Bank subsidies (some of which go to healthy large corporations like Boeing) support US exports and labor. He added that he can’t understand why some economists oppose those subsidies and at the same time support corporate tax reduction, which, he said, only add to corporate profits. This is a perfect example of the Lefts one dimensional thinking and their complete ignorance of how capitalism works.

So far as corporate profits go he is right, but only to a point. A reduction in the corporate tax rate would boost profits temporarily, but (everything being equal) competition would kick in and prices would decline below where they were before the tax cut. The former tax revenue would find it’s way into the customers pockets, not the shareholders.

In a free market system a product is priced in order to return the maximum profit to shareholders. But, that price is not freely arrived at. Competition determines what that maximum price is, and if everyone competing eliminates an expense (as in corporate taxes) at least one competitor will reduce prices proportionately, forcing everyone else to do so.

Of course a profit is necessary to survive, putting a floor on prices, but in theory that price level was determined before the tax reduction and would remain the same afterwards. Better marketing, cheaper production costs and a host of other things always cause variations in pricing and profitability, but these things are ongoing with or without tax reductions. If the coffee growers price goes down you can be sure after an adjustment period the supermarket price will go down as well. The first Ford car cost about $5,000, but after Henry Ford successfully reduced production costs with his assembly line, the price came down to $500. It is no different with taxes.

I will only briefly mention the other positive ramifications of corporate tax reduction. Cheaper prices that would result are a benefit that every consumer enjoys, not only that reviled 1%. Consumer price reductions equate to an earnings increase for everyone, although liberal economists are loath to point that out. And although this simple concept seems too abstract for geniuses such as Summers, lower taxes and thus lower prices support wealth production and economic growth.

My question is, are these ridiculous one dimensional (in a multi dimensional universe) liberal economic theories honestly (albeit foolishly) believed, or are the always decorated liberal economists really doing leftist marketing disguised as scholarship?

Tuesday, April 1, 2014

How Did Obama Get Elected?

How is it possible that Barack Obama got reelected? One might explain his original ascendency, however unlikely, to his hidden nature, something the press studiously avoided talking about. But to make the same mistake again is almost unfathomable. He is a man that sat in the pews of a racist, Jew hating, America hating preacher and called him his mentor. He refers in his autobiographies (the plural is not a typo, he has two of them) to Frank, who is Frank Marshall, another mentor. Marshall was a lifelong communist, as thus an apologist for Joseph Stalin, the murderer of 80 million people. He cut his teeth in Chicago politics at the home of Bill and Bernadette Ayres, convicted domestic terrorists. He attended events for fundraisers for Hamas, terrorists in the middle east. And if anyone doubts that past is prologue, he has governed using the same destructive principles that the aforementioned rogues gallery advocate. Who would vote for such a man? How could this happen?

The founding fathers believed that a representative democracy could only flourish if the voters had a vested interest in the long term health of the country. It is often the case that the long and short term interests are opposite one another. Some men are willing to delay gratification in order to enhance long term benefits, while others seek instant gratification at the expense of long term health. Our founding fathers understood that allowing everyone to vote was a recipe for disaster. Too many voters would opt for instant gratification regardless of the longer term costs. It was almost self evident that any system embracing one man one vote was doomed to fail.

The fathers wanted to insure that only voters with a long term interest qualified to vote. Because women were considered ignorant in the ways of government and business, and a man not owning property was thought to be too young and inexperienced to cast a thoughtful ballot, or simply unqualified by virtue of his station in life, they were excluded from voting. Land was prized above most  things (this was a time when Ben Franklin said of our agrarian society, “All wealth will come from the ground.”), so that or a minimum amounts of land, savings or taxes paid were used as a criteria to qualify to vote.

Below are quotes illustrating the thinking at that time. It applies today as much as it did then. My thesis is that if only people with a vested interest in the long term survival of the US were voting, this aberration of an Obama re-election could never have happened.

'Property requirements were widespread. Some colonies required a voter to own a certain amount of land or land of a specified value. Others required personal property of a certain value, or payment of a certain amount of taxes. Examples from 1763 show the variety of these requirements. Delaware expected voters to own fifty acres of land or property worth £40. Rhode Island set the limit at land valued at £40 or worth an annual rent of £2. Connecticut required land worth an annual rent of £2 or livestock worth £40.

John Adams, signer of the Declaration of Independence and later president, wrote in 1776 that no good could come from enfranchising more Americans:
Depend upon it, Sir, it is dangerous to open so fruitful a source of controversy and altercation as would be opened by attempting to alter the qualifications of voters; there will be no end to it. New claims will arise; women will demand the vote; lads from 12 to 21 will think their rights not enough attended to; and every man who has not a farthing, will demand an equal voice with any other, in all acts of state. It tends to confound and destroy all distinctions, and prostrate all ranks to one common level.

The true reason of requiring any qualification, with regard to property, in voters, is to exclude such persons as are in so mean a situation that they are esteemed to have no will of their own. If these persons had votes, they would be tempted to dispose of them under some undue influence or other. This would give a great, an artful, or a wealthy man, a larger share in elections than is consistent with general liberty. 

Interesting that the quote above believes limiting who can vote would protect against wealth having an undue influence. What has happened since the one man one vote policy was adopted is not that wealthy individuals have gained undue influence, but the government itself has become the wealthy force that trades favors for votes. The never ending expansion of the social programs has provided a framework for Democrats to gain and expand power. These programs have proven to be cancers destroying the nations economic and social fabric under the false banner of compassion, but they succeed in garnering votes. 

Most Democratic voters have no idea what philosophy the party employs, they don’t know who the Vice President is, who their senator is, or anything else related to the economy, civics or the legal system. But they do know how to apply for welfare, food stamps, aid to dependent children, heating subsidies  rent subsidies and Obama phones, and they know what party to vote for to insure the money for these programs keeps flowing.    

Whether these laws limiting voting accomplished their purpose, or could have been crafted better is open to debate. Even if there was merit at the time to the prohibition on women voting, it certainly would be an absurdity today. But the idea that letting the entire public vote would destroy the democracy is as true today as it was then. In order to expand the class of uninformed voters, the Obama crowd routinely insults our intelligence with nonsensical claims such as arguing that identifying oneself at a polling place is undemocratic and an undue burden. To the contrary it is both democratic and a small step in the right direction if this nation is to survive.

Early critics of a democratic system said a democracy can only exist until the voters learn they can vote themselves the other guys money. I fear our system, one man one vote, will prove those early critics right. We are seeing it in real time with the election of the most unqualified, most dangerous, man to ever run for much less hold the office of the President. He is an ideologue with no sense of history, no experience in the real world, no understanding of capitalism or any other economic system, whose world view has been shaped by intellectually arrogant and intellectually bankrupt, unaccomplished, fringe radicals.  

Tuesday, January 28, 2014

Castro And His Friends

My daughter Kathryn wrote this a couple of years ago. It is a reminder of the power of the mythology regularly embraced by the Left.

The mainstream media tells a consistent story about Cuba’s past and present—Cuba’s healthcare and education are better than the United States’, and Fidel Castro is a romantic revolutionary who saved his people from the evils of Batista. Dan Rather was so enamored that he referred to Fidel as “Cuba’s own Elvis.” Castro's supporters admit that although he may have “infringed on a few human rights,” such is the cost of a revolution, one that has vastly improved the Cuban quality of life.
This narrative portrays Che Guevara as a young martyr, inspired by the injustices he saw. He looked to Marxism for the answer. This image is pervasive throughout every leftist center in the world.  His face is plastered on t-shirts and stickers of trendy hipsters. Little do they know they are wearing the face of a sadistic mass murderer. Castro too is a cold-blooded killer who has kept 6 million people in an island prison for 60 years.  
I was lucky enough to interview Humberto Fontova, a Cuban American author who escaped with his family in 1961.  Tragically, his father was killed in the process.  Fontova has worked for years to expose Castro’s lies. He wrote two books on the subject, Exposing the Real Che Guevara and the Useful Idiots Who Idolize Him, and Fidel: Hollywood’s Favorite Tyrant. For those who are skeptical of what follows, please note that Fontova’s work is all footnoted and well sourced.
Here are some facts he presents comparing pre Castro Cuba with the present  Pre-revolution Cuba had a higher per capita income than most Western countries.  It was a first world country from the 1940s until 1959 when Castro seized power.  Today it is one of the poorest countries in the western hemisphere. Prior to Castro, Cubans were free to leave if they chose.  Today emigration is not permitted and is punishable by death.  Before Castro more Americans lived in Cuba than Cubans lived in the United States. Today Cubans risk their lives daily trying to escape.  Before Castro, Cuba had the 13th lowest infant mortality rate in the world. Today it is 50th. Before Castro, Cuba had more doctors and dentists per capita than the US. Today 75% of doctors who have escaped to the US fail the exam to practice medicine.  Worse, over half fail the examination to simply practice as nurses.  The average height of Cubans has decreased over the last two decades, a clear sign of malnutrition. There have been outbreaks of Dengue fever, which had been completely eradicated prior to Castro. The "quality education" claims are preposterous. What Castro calls education is mere indoctrination.  Cuba has the highest abortion rate in the Western hemisphere. Women undergo forced abortions if any pregnancy hints at trouble in an effort to keep the infant mortality rate down. Malformed infants are routinely murdered in secret. In short, it is a failed state run by a murderous tyrant.
What about political freedom? Cuba has the highest incarceration rate on earth right now. There are so many speech and assembly restrictions that it is hard to determine who is a political prisoner and who is a common criminal. Fontova thinks that 90% of those in jail are there for political reasons. Authorities can throw anyone into prison without reason if they perceive political threat.
So what’s the attraction? Why has Castro been so embraced by the left? Fontova said Che and Fidel exude coolness to liberals.  “Look, Che looks like Jim Morrison. Fidel looks like Jerry Garcia. They both nailed the coolness cache of being hippies who were bringing freedom to Cuba. Picture the United States in the late 50s. The US is reigned over by an old bald golfer, Eisenhower.  America is filled with white picket fences and families watching June Cleaver. All of a sudden these bearded long-haired guys pop up and they seem so cool. They were the first beatniks."
This cache persists. Fontova explained, “One might have hoped that the veil would have fallen by now. Castro and Che jailed more political prisoners as a percentage of the population than Stalin.  They murdered more political prisoners in first three years in power than Hitler in his first six.  They introduced Stalinist horror to western hemisphere imprisoning 10,000 women, hundreds of whom were murdered, and committed countless other atrocities. One would think the cache might have worn off. Well if you do think that, you are wrong.”
Fontova further explained why the world believes so many lies about Cuba.  Castro has a genius propaganda machine. “He began the initiative before he reached ‘office’ to bamboozle the US media while he was still a so-called rebel,” said Fontova. “There is a passage in Che’s diary where he said ‘more valuable to us than military recruits for our guerrilla force were media recruits from America to spread our propaganda.’ In 1954 Castro was in jail in Cuba. He wrote a letter to a revolutionary colleague stating, ‘propaganda is at the very heart of our struggle.  We can never abandon propaganda.’” He recognized the importance of his control of the US media.  He still commits any number of heinous crimes that the world never hears about because of his skill in controlling the information flow.
Castro has a near flawless system controlling the media. Every mainstream American news source must report through the state controlled Havana Bureau, which reports only what the state approves.  It seems that since the end of the Cold War, Americans have forgotten what news from a Communist regime is like. “Thirty years ago years ago during the Cold War, people knew what Communism was and no one would believe any reports coming from a communist source,” explained Fontova.  “It’s really laughable. You knew they were liars. Nowadays, we have CNN (Castro News Network), ABC, CBS, Reuters, et. al. reporting out of Cuba only what is handed to them from Castro’s propaganda ministry. “
The left’s blind acceptance of this ruthless thug as an inspirational revolutionary is best highlighted by an episode here at Harvard. Castro had applied to Harvard Law School in 1948 and been rejected. In April 1959 Harvard Law Dean McGeorge Bundy decided to correct this "injustice." Encouraged by the adulation of the Harvard student body and faculty, the Dean had hardly declared, “I’ve decided to admit him!” before the crowd erupted with delight. In April 1959 while Castro was speaking at to standing ovations at the school, his firing squads were murdering hundreds of Cubans, including women and children as young as 17.
I asked Fontova about the debate between conservatives and liberals on how to deal with Cuba.  Conservatives generally believe sanctions are the best way to bring Castro down, while liberals believe sanctions have not worked and engagement would be more effective.  It seems like both sides make reasonable arguments.  Fontova disagrees.  “The verdict is in, and anyone who cares to look at the evidence will determine that engagement has failed abysmally.”  He went on to list some frightening statistics. Contrary to US State Department claims, there is no real US embargo. Until last year, the US was Cuba’s largest food supplier and fifth largest commercial trading partner. Nearly 500,000 Americans legally visited Cuba last year. Nearly $3,000,000,000 reaches Cuba annually from the US.  Only Chavez’s Venezuela is a larger trading partner with Cuba.
Obama’s recent policy changes allow even more open travel and money to be sent to Cuba. Fontova believes this is keeping Castro’s regime alive.  He said that they are nearly bankrupt. This past December Raoul Castro (Fidel's brother and newly appointed head of the state) said, “the life of the revolution hangs in the balance. We either reform or we sink.”  The Italian ambassador to Cuba publicly stated that Cuba would almost certainly be bankrupt by 2011.  “But just as they reach the tipping point, Obama throws them a life line.  Hundreds of thousands more Americans will put money directly into Castro’s pocket,” said Fontova.  This is not just from direct payments. The government controls the tourism industry. Every type of travel there directly funds the regime.
He believes that that a real change can only occur after Castro and Raoul die. Raoul’s recent ascendancy has done nothing for change in Cuba. He was a Communist party member before Fidel.  The regime is composed of  “the abject failures and common criminals who have absolutely nothing to gain by adopting capitalism. But there are younger men in the bureaucracy who feel left out.  The older guys make all of the money. The younger men, simply for materialistic reasons, want in.  This will probably start the reform after the biological solution” (the death of the leaders).  “It’ll unwittingly open things up.”
A genuine embargo would certainly help. Fontova pointed to South Africa as an example of a successful US embargo. We should set the international example. Political support is essential to do this. The American public needs to be educated. Let us hope that with alternative news sources available, people will stop believing the nonsense spit out by the mainstream media and will start getting the true story.