Archive for February, 2012

Treasury Secretary Geithner scorns U.S. Declaration of Independence

February 29, 2012

“Last week Treasury Secretary Tim Geithner said that the ‘most fortunate Americans should pay more in taxes for the privilege of being an American.’  One can debate different ways of balancing the budget. But Mr. Geithner’s argument highlights an unfortunate and very destructive instinct that seems to permeate the Obama administration about the respective roles of citizens and their government.” Lawrence B. Lindsey, ‘Geithner and the ‘Privilege’ of  Being American’, The Wall Street Journal, February 29, 2012

Let me remind Comrade Geithner of  the opening passage of The Declaration of Independence, July 4, 1776:

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. – That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed. – That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government,”

When you next check Webster’s Dictionary, Comrade Geithner, you will learn that ‘privileges’ are things granted to one individual by another, higher-ranking individual. For example, you were privileged by some higher authority not to spend some time in jail for serious tax fraud in the Spring of 2009.

The Founding Fathers rejected outright, in The Declaration of Independence, any notion that the privilege of being an American was granted by a higher authority, presumably by Britain’s King George III. They recognized that Americans were imbued with natural rights, endowed by the Creator, and not by any government, whether autocratic or democratic in nature. They also recognized that citizens institute their governments and supervise them to ensure that their own natural rights are honored and maintained by their representatives.

“Being an American is a right, not a privilege.  The privilege belongs to those who are temporarily allowed to serve this great nation in a decision-making capacity.  When they turn this privilege into a right to distribute government largess in ever larger quantities – and in ways, to use Jefferson’s phrase, a ‘wise and frugal government’ would not – it is those in government, and not the governed, who bear the responsibility for our budgetary problems.” Lawrence B. Lindsey, ‘ Geithner and the ‘Privilege’ of Being American’, ibid.

Remember well what followed The Declaration of Independence, President Obama and Treasury Secretary Geithner. I doubt that Canada would feel comfortable in accepting you into enforced exile, should you continue to threaten the natural rights of your superiors.

Obama and Congress breach FDR social security contract

February 28, 2012

President Obama and the United States Congress have deceived the general public by using  recent payroll tax-cuts as a device to renege on the Social Security Contract carefully orchestrated by the FDR administration during the late 1930s.  Embedded in the fine print of the so-called stimulus package is a provision to transfer more than $215 billion in general tax revenues into the Social Security Trust Fund to compensate for the reduction in payroll tax revenue. This constitutes a fundamental breach of contract with the American people.

Let me explain.  Social Security, from its inception, has been financed through a separate payroll tax levied on covered workers.  Its finances are tracked through a separate Trust Fund system, distinct from the general federal budget. This separation was designed to distinguish the Social Security program from welfare programs, where benefits are assessed on the basis of  identified need, and where contributions are based on ability to pay.

Social Security was designed so that all workers – rich as well as poor – would pay payroll taxes at the same rate up to a maximum income ceiling. Benefits received would be based on the amount that each individual paid into the system over a lifetime of work,  prior to a designated age of access to the pension scheme. A higher wage earner, in this way, would pay more into the system, and receive more in benefits.

Note that the Social Security system, from the  overall perspective of taxes and benefits is a progressive system. Lower income workers receive disproportionately higher benefits.  Higher income workers receive no benefits from earnings above the maximum income cut-off for the payroll tax.

President Obama and the Congress have now moved surreptitiously to turn the system into a welfare program, and to render it far more progressive, by deploying the income tax instead of the payroll tax.  By subsidizing payments with income taxes, they have terminated the contract that Social Security benefits are fully earned by the recipients.

According to Charles Blahous, this breach of contract is no accident. It is the result of a fundamental change of philosophy driven by Liberal Democrat policy advocates over the past decade.

“As their stated concerns about general income inequality grew, there came a proliferation of proposals to replace Social Security’s ‘regressive’ payroll tax financing with income generated from progressive income taxes.  The partial conversion last year of Social Security to income-tax financing represents a first concrete step in executing the change…The idea that higher-income Americans should begin to subsidize Social Security – and for the first time, receive no benefits for those added contributions – gained significant momentum among left-of- center policy advocates in the decade after President Clinton first proposed it.  Noted economists Peter Diamond and Peter Orszag proposed in 2003 that a Social Security ‘legacy tax’ be imposed on earnings above the taxable wage base, thereby ensuring that very high earners contribute to financing the legacy debt in proportion their earnings.  No benefit credits were to be allocated based on this additional 3 percent  ‘legacy tax’.” Charles Blahous, ‘The Dark Side of the Payroll Tax Cut’, Defining Ideas, February 24, 2012

Unless this sleight of hand is exposed and quickly reversed, readers of this column who pay income taxes should brace themselves for the substantial new taxes that they will soon be paying to bail out a Social Security system whose cupboard is already bare – a Ponzi Scheme whose Trust Fund is full of Treasury IOUs instead of invested monies from past payroll taxes.

The politics of entitlement is very ugly. Politicians simply cannot keep their thieving hands out of  an apparently limitless money jar.  Addicted as they are to the jar’s contents, they ruthlessly renege on contracts when the jar runs empty.

And of course, politicians are above the law. They cannot be sued in the courts for breach of the Social Security contract.

Scumbag Santorum punches low in Michigan

February 28, 2012

If ever I required further confirmation of what a filthy scumbag Rick Santorum truly is, yesterday he delivered the evidence in Michigan. He begged Michigan Democrats to invade the GOP primary to vote against his rival Mitt Romney.

Incidentally, this tells the GOP that Santorum expects to lose against President Obama should he win the Republican Party nomination. Democrats would be certain to vote against the stronger candidate should they decide to cross lines for any GOP primary.

Santorum increasingly brags about his working class roots.This is a terminological inexactitude. Working men and women are decent hard-working, law-abiding individuals. Rick Santorum  was born in the gutter, lives in the gutter, and is most likely to die in the gutter.

 

 

Rick Santorum: a religious bigot runs for the White House

February 27, 2012

Rick Santorum is a Roman Catholic bigot, who is running for the White House on a social agenda designed to appeal to the religious right of the Republican Party. It is an agenda that should exclude him from serious consideration by any Republican Party that seriously wishes to bring down a left-of-center incumbent President.

America is a multi-cultural, multi-religious country dedicated to the preservation of religious freedom,  including the freedom to be agnostic or atheistic. The early history of the colonies inculcated in  the Founding Fathers the wisdom of  protecting European immigrants at large from the Roman Catholic religious persecution from which they had originally fled. The Founders provided such protection by requiring a strict separation between Church and State – a separation that is written into the United States Constitution. 

When Rick Santorum states in public that the very notion of such a separation makes him want to vomit, one knows immediately that he could not take the oath of office to preserve and to protect that Constitution. He is disqualified from the office of the presidency even before he runs for that office.

As is evident not only from his many speeches, but also from the size of his family, Rick Santorum follows Roman Catholic doctrine by abstaining from the use of contraceptives and from resort to abortion. His family has paid a price for that decision, since, as is not unusual in very large families, the youngest offspring are prone to genetic disorders. That is his private choice, sacrosanct in terms of the Constitution.

However, should Rick Santorum attempt to use the office of the White House to impose Roman Catholic doctrine upon the population at large, by any method short of a constitutional amendment, he would violate the Constitution itself. Moreover, if successful, he would place American families at the risk of adverse health consequences that he has freely accepted for his own family, almost certainly without personally bearing the financial costs that such  health-afflicted American households would be expected to incur.

The fact that a political candidate can run such a campaign as a religious bigot without quickly disappearing from the race sends out an alarming message about America. A sizeable proportion of its population evidently is anxious to return the country to the Middle Ages, when irrational beliefs dominated reason, and when a ruthless self-serving, wealth-seeking Roman Catholic Church dominated Western Europe. Note that on the chess board, the bishops, not the knights, or their castles, are situated closest to the throne.

How long before you would introduce America to the Spanish Inquisition, President Santorum?  How soon before apostasy would be punishable by torture and execution?

Siloviki: Russia’s Cosa Nostra autocracy

February 26, 2012

Russia in no sense is a democracy in the Western sense of that term.  It is completely controlled by an elitist oligarchy,  obedient to Vladimir Putin, and dependent upon him for its continued access to privilege and wealth.

“In Putin’s Russia, the political power, government structure and a substantial chunk of economic resources are controlled by a network…of  ‘siloviki’. The word comes from the Russian for strength and refers to officials from the police, military and secret services.” Kirill Kabanov and Olga Kryshtanovskaya, ‘A world of privilege at stake for Putin loyalists’, The Washington Post, February 26, 2012

In the USSR, the siloviki were feared, if not respected, as the guarantors of Soviet power.  Following the collapse of the Soviet Union in 1991, they were humiliated and deserted by President Boris Yeltzin and battered by a temporarily free press. When Vladimir Putin eventually assumed the Presidency in 2000, the siloviki slipped back into power, hungry to take their share of the spoils available to a new oligarchy. They now comprise a network of bureaucrats, businessmen and corrupt hangers-on with a vital pro-Putin stake in the March 2012 presidential election.

The core of the silivoki is located within the 104 most influential people in Putin’s Russia. Among those holding 22 posts closest to Putin, at the very pinacle of the power structure, 14 are former KGB associates and the others are either close friends or other trusted colleagues from his home town of Leningrad (now St. Petersburg).

The most successful members of this network enjoy expensive property, lucrative investments, and large overseas bank accounts. They send their offspring to study at the world’s most prestigious universities. They live in luxurious accommodations, all the while earning relatively modest government salaries.  The siloviki have built Putin a billion-dollar palace in return for the privileges that he has bestowed upon them. It is estimated that Putin and the siloviki control 15 per cent of Russia’s gross domestic product.

The only risk confronting Vladimir Putin, in such a tightly controlled system, would emanate from within the siloviki itself. If Putin continues to deliver the goods, he is completely safe from any electorate and from any potential Russian spring.  The scent of jasmine will be quickly and ruthlessly obliterated by a  Russian Mafia that learned how to enforce its blood oath of loyalty during the late years of the Evil Empire.

“The elite have shown no signs they are willing to cede authority or privilege. To give up all this?… Their business assets and residences?  Their palaces and country houses?  Their bank accounts and control over financial flows?  Their power and influence within Russia and abroad?  And why?  Because 100,000 people gathered in Moscow streets?  They will be trying to stay in power for a long, long time. Forever.” Kirill Kabanov and Olga Kryshtanovskaya, ”A world of privilege at stake for Putin loyalists’, ibid.

A nice radioactive  cup of tea for each of you from your best friend Vlady, Kirill Kabanov and Olga Kryshtanovskaya?

Go gentle (and cheaply) into that good night

February 25, 2012

The average American will  undergo medical treatment that costs one-third of all his lifelong medical costs during the last year of his life. The treatment that he then receives will often result in an extremely poor quality for his extended  life.  Doctors, for the most part, do not allow themselves to be put through such a wasteful nightmare:

“It’s not something that we like to talk about, but doctors die too. What’s unusual about them is not how much treatment they get compared with most Americans, but how little.  They know exactly what’s going to happen, they know the choices, and they generally have access to any sort of medical care that they could want.  But they tend to go serenely and gently…In a 2003 article, Joseph J. Gallo and others looked at what physicians want when it comes to end-of-life decisions.  In a survey of 765 doctors, they found that 64% had created an advanced directive – specifying what steps should and should not be taken to save their lives should they become incapacitated.  That compares to only about 20% for the general public.” Ken Murray, ‘Why Doctors Die Differently’, The Wall Street Journal, February 25, 2012

Nursing professor Karen Kehl ranks the attributes of a graceful death as including being comfortable and in control, having a sense of closure, making the most of relationships, and having family involved in care.  Hospitals provide few if any of those qualities.  At enormously high cost, they allow their patients to eke out their final weeks (or months) drugged out of consciousness, fed by drips, in semi-private rooms, visited infrequently by family and friends, often in the presence of strangers.

Ken Murray, a retired clinical professor of family medicine, knows from personal experience that there is a better and a much cheaper way to live out one’s final days:

Several years ago, at age 60, my older cousin Torch  had a seizure.  It turned out to be the result of lung cancer that had gone to his brain.  We learned that with aggressive treatment, including three to five hospital visits a week for chemotherapy, he would live perhaps four months.Torch was no doctor, but he knew that he wanted a life of quality, not just quantity.  Ultimately, he decided against any treatment and simply took pills for brain swelling.  He moved in with me.  We spent the next eight months having fun together like we hadn’t had in decades.  We went to Disneyland, his first time, and we hung out at home.  Torch was a sports nut, and he was very happy to watch sports and eat my cooking.  He had no serious pain, and he remained high-spirited.  One day, he didn’t wake up. he spent the next three days in a coma-like sleep and then died. The cost of his medical care for those eight months, for the one drug he was taking, was about $20.” Ken Murray, ‘Why Doctors Die Differently’, ibid.

Way to go, Torch!  If  only more Americans would think  like him, would think indeed like doctors when making their own end-of-life decisions,  the Medicare-funding nightmare would be no more.

Obama’s Solyndra leaves toxic waste dump at abandoned plant

February 24, 2012

President Obama hailed Solyndra for its ‘go clean while going green’ plans for a new post-Bush environment. What a bag of tricks he created in squandering on   this environmental loser more than $700 million of taxpayers’ money  as poster boy for his ‘save the earth’ campaign.

Not only was the loan flushed straight down the White House toilet by an incompetent, even corrupt corporation. Left behind in its abrupt closure and bankruptcy filing, is a filthy toxic waste dump at its abandoned plant in Milpitas, California, leased from its landlord, iStar C.T.L.I.L.P.

Officials at iStar were not given the keys to the premises until February 2012, though Solyndra had stopped making its lease payments in September 2011. when it filed for bankruptcy protection in Delaware. Left behind, abandoned on the premises were part-opened containers of unidentified chemicals and lead processing machinery.    It is known that remnants include liquid chemical compounds, including cadmium sulphide, thiourea and hydrochloric acid, as well as lead contaminated equipment.

Perhaps President Obama is in the process of redefining these compounds as environmental cleansers. If not, perhaps the President would care to cough up his own personal fortune to cover the cost of Environmental Protection Agency  violations and to restore the abandoned premises to required pristine environmental standards?

More likely the President will  divert his gaze straight back to the campaign trail and leave iStar to clean up the filthy mess that his administration has imposed on Milpitas, California.

‘I have some very nice solar panels on the back of my truck, folks, that I should be pleased to sell to you.  They fit well onto the  bridge in Brooklyn that goes with them in this once-in-a-lifetime special deal! Just throw the greenbacks onto my campaign truck. ‘Yes, you can!’

Australia’s Labor government tears itself apart

February 23, 2012

Australian Prime Minister, Julia (the red) Gillard called today for a leadership vote within her ruling Labor Party, one day after her bitter rival Kevin Rudd (known affectionately as Krud) resigned as foreign minister in order to campaign for her removal. Labor’s caucus – composed of 103 upper and lower house members – will determine whether or not Ms. Gillard will keep her job on Monday next. Votes will be cast by secret ballot and party officials will quickly announce the winner.

This internecine struggle between the two Labor leaders is a replay of a 2010 war in which Mr. Rudd was removed as Prime Minister by his own party, at Ms. Gillard’s request, following a sequence of unpopular policy moves, including a plan to introduce a mining tax.  Once in office Ms. Gillard imposed highly unpopular taxes on carbon pollution and mining profits. She did not earned her nickname ‘red’ for nothing.

This second outbreak of violence within the Labor Party may succeed in provoking a vote of no confidence in the government itself, given its reliance upon the continuing support of a few independent lawmakers and the Green (nicknamed waterlmelon because it is green outside and red inside) Party.

The good news for market- loving Australians is that the Labor Party would be removed from office in any early election. The Liberal-National coalition led by Tony Abbott would sweep to victory winning some 55 percent of the popular vote. Australians would quickly adjust their vision to appreciating colors other than red and green across the political landscape.

Put not your trust in Greek promises

February 22, 2012

1. The Greek leader Odysseus ordered sailors to bind him to the mast of his sailing vessel, a pentaconter, so that he would resist the song of the sirens.

2. The classic Greek tragedies follow a very clear form. The hero first suffers from overweening pride, or hubris, which results in retributive justice, or nemesis. This leads to a turning point in his fortune, or peripeteia. Only then can he move towards a cleansing, or catharsis.

3.  The Greeks defeated Troy by exploiting the trust of Trojans through the device of a false gift of a wooden horse loaded with Greek soldiers. The Greeks reveled in this act of opportunism and derided Troy for its naivety.

4.  In modern Greece, the masts of the ship of state are made of cardboard, the ropes that supposedly constrain the politicians are made of cotton; and its people still exhibit insufferable hubrisNemesis is present, and  is evident to all except the Greeks, whose hubris remains intact.  Catharsis is absent from the stage of this unfolding drama. No one across the euro-zone trusts the Greek people or the Greek politicians. Farce, not tragedy, is the essence of the resulting play.

In private markets, commitment strategies are fundamental to economic life.  John Kay expresses this succinctly:

“Households and businesses  are able to engage in complex transactions because they are able to restrict their future behavior.  They can do so by investing in their reputation; they incur contractual obligations that put them under the jurisdiction of the courts.  The establishment of effective mechanisms that restrict opportunism and allow costly commitments may be the most important distinction between rich and poor countries.” John Kay, ‘Why lashing governments to the mast will always prove futile’, Financial Times, February 22, 2012

However, as John Kay wisely notes, the very power that makes government an effective enforcer of the commitments of the people renders it incapable of enforcing its own promises. 

“Governments will in the end always put voters ahead of prior commitments or external obligations….The Odyssey taught humanity the dangers of hubris and the need for flexible responses to interminable and unpredictable setbacks.  If Europe’s economists and policymakers did not learn these lessons from the ancient Greeks, they must learn them from the modern ones.” John Kay, ‘Why lashing governments to the mast will always prove futile.” ibid.

Dominique Strauss-Kahn arrested over French prostitution ring

February 21, 2012

The former Managing Director of the International Monetary Fund, Dominique Strauss-Kahn, was formally placed under arrest today on suspicion charges of aiding and abetting a pimp, and of corruption, during an interrogation in Lille, in Northern France. The summons follows a wide-ranging inquiry into a prostitution ring allegedly based in Lille.

Eight people, including Jean-Christophe Lagarde, the head of police in the Lille region, have already been placed under investigation (the French equivalent of arrest)  on suspicion of aggravated pimping, and of being part of a criminal organization, in connection with this ongoing investigation.

Although consorting with prostitutes is not a crime in France, DSK is under investigation for encouraging women to take up prostitution and for facilitating the financing of prostitutes by businesses, both of which are crimes in France.

Magistrates have been informed that prostitutes were paid hundreds of euros to take part in swingers’ parties with DSK, notably at the chic Murano Hotel and L’Aventure Club in Paris, and at the W  Hotel in Washington, DC. A number of these prostitutes were flown out to the United States by French businesses to service DSK’s sexual desires.  Many of these liaisons were allegedly funded by David Roquet, the head of the northern French division of Eiffage, the Gallic construction group. They were itemized as lobbying expenditures in the corporate accounts. Mr. Roquet has stated that his head office knew that he was paying for prostitutes for DSK  with company money because he always wrote DSK on the back of the expenses form.

One 30-year-old prostitute has told the police that she had sexual relations with DSK on 11 occasions and was paid at the rate of between E500 and E1,000 depending on the nature of the sexual services that she provided.

The arrest of DSK on these charges will be used as evidence against DSK by U.S. lawyers representing Nafissatou Diallo, the New York chambermaid who claims he raped and sodomized her on May 14, 2011.  Although criminal charges against DSK were dropped by New York prosecutors, Ms. Diallo is currently pursuing a civil claim against him for significant monetary damages.

This latest news is unlikely to help DSK to resuscitate any kind of  career, save perhaps in the criminal underworld. Whether or not he will end up behind bars is now in the hands of the French system of justice, which is notably less politically corrupted  than that of  the District of Manhattan.


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