Mayhem at Government Motors - Mickey Kaus reports that the pink slips - and long knives - are out at GM.  Hey, when are we going to sell that GM stock?  We need the cash.

Hope is in short supply - Rasmussen poll: "New low: Just 14% think today's children will be better off than their parents."  They can't find jobs to pay off the national debt we racked up.

Those pesky democracies - Hit & Run: "Why Elizabeth Warren wants America to be more like Communist China."

NY Times: Darn it, we need to reform entitlements

When I saw this opinion piece by Bill Keller, I figured he was getting punk'd again.  Keller goes on at length sounding very much like this blog: entitlement spending is out-of-control, it's crowding out all the discretionary spending we call the "government", and raising taxes or cutting the military won't get us close to balancing the books.  This is quite a betrayal to the dogma of the Times' editorial page which fluctuates between denial and standard liberal silliness (let's raise taxes in a recession!).  But, this being the NY Times, some habits die hard:

So the question is not whether entitlements have to be brought under control, but how. The Republican plan espoused by Mitt Romney and his fiscal lodestar Paul Ryan would cut the cost of entitlements largely by moving toward privatization: personal investment accounts for Social Security, vouchers for Medicare. And it’s not at all clear the Republicans would assign any of the savings to investing in our future.
At least the Republicans have a plan. The Democrats generally recoil from the subject of entitlements.

If you think Keller might launch into a brief harangue on the Democrats' political cowardice at this point, keep waiting.  This has all the echoes of Tim Geithner's "we don't have a solution but we know we don't like yours."  In the end, Keller misses the whole point as he urges Washington to take a whole series of steps to raise taxes (natch), reform this and that, and generally expand government to fix the problems it self-created.

Turn in your Coke cans - The Truth About Cars has an interesting report that Ford is planning on building a new generation of trucks with a mostly aluminum body.  They would be more difficult to manufacture (steel plates are moved with magnets on the assembly line) but they could be 700 pounds lighter, which means better gas mileage.  Another fear is hurting the F-150 brand by "building a truck for sissies."

Hold on, we're decelerating - Real Clear Politics: "The 1.5% Presidency: more debt, no growth."  Since the unemployment rate is a lagging indicator, I imagine that the White House is sending a constant stream of muffin baskets to their buddies at the Bureau of Labor Statistics.

A pina colada at Trader Vic's - Today NPR had an adorable story from a series called "Mom & Dad's Record Collection" about a woman who hated Warren Zevon's "Werewolves of London" and her father who tormented her by playing it all the time.  He would call at random times and leave it on her answering machine.  Eventually it became a point of bonding and at her wedding she (unexpectedly to him) played it for the father-daughter dance.

What with the writing and those typos - Twitchy: "DNC communications director sucks at communicating; mockage ensures."

Who are you going to believe: me or your lying ears?

It's pretty clear now that the internal polling/focus group response on Obama's "You didn't build that" gaffe must have been devastating because it forced the President to quickly record a new ad claiming that his comments were taken out of context.  Because when he said "If you've got a business - you didn't build that" he actually meant roads and bridges.  You didn't build that roads.

As the Minuteman gibes, the most articulate President ever now says: "I didn't say what I said, and anyway, I meant the opposite."  Obama wants you to know that he supports business-people and success.  Adding a little bit of that much-sought context, here's how Obama lauded those engines of the economy in his Roanoke speech:

There are a lot of wealthy, successful Americans who agree with me — because they want to give something back. They know they didn’t — look, if you’ve been successful, you didn’t get there on your own. You didn’t get there on your own. I’m always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else. Let me tell you something — there are a whole bunch of hardworking people out there.

In other words: what's so damn special about you?


Extra - The Hill: "Obama campaign stepping up damage control over remark."

More - Legal Insurrection: "Obama and Warren cribbed 'build it' narrative from progressive Berkeley professor."  That would be George Lakoff of the Little Blue Book.

Economically wise, politically impossible - Via the Grumpy Economist, here are six ideas that economists believe are prudent, but will never fly:

Eliminate the mortgage tax deduction.
End the tax deduction companies get for providing health-care to employees.
Eliminate the corporate income tax. Completely.
Eliminate all income and payroll taxes. ... Instead, impose a consumption tax.
Tax carbon emissions.
Legalize marijuana

I like 'em!  Well, except for the carbon emission tax since I have a long commute.

GM is ali....whoh...not so fast - Zero Hedge: "GM stock slides to fresh post-bankruptcy lows."  Question: why is the federal government still holding on to GM shares?  Oh, yeah, they were supposed to go up in value.

Colleges gone wild - As my sons inch towards graduation, I'm getting more and more concerned about stories like this, via Maggie's Farm: "In 2003, only two colleges charged more than $40,000 a year for tuition, fees, and room and board; by 2009, 224 were above that mark. And now many are inching toward (or past) $50,000 a year."  Why is tuition skyrocketing?  In part because colleges are re-branding themselves as country clubs instead of places for higher education and personal growth.

GMTA - Didn't I just say this?  Hot Air: "The man’s nothing if not consistent. He campaigns as he governs, spending astounding sums to little effect."

Stall speed - Slate: "Five reasons why we aren't even close to a real recovery."

Obama runs his campaign like he runs the country - That is, massive spending to little effect: "President Obama outspent Mitt Romney 2 to 1 in June even as Mr. Romney far outraised him, according to campaign reports filed on Friday with the Federal Election Commission, leaving Mr. Obama and the Democratic Party with significantly less cash on hand than Mr. Romney and the Republicans as polls show a head-to-head race."  I suggest you ask your wealthy donors to pay more out of fairness.

I got nothin' - There's nothing to say after Colorado other than to pray for the victims.

You misheard, America - Hit & Run: "How 'You didn't build that' became 'He didn't say that'"  And when Obama said "the private sector is doing fine" he meant that 386,000 jobless claims is just fine.

Extra - Minuteman: "I didn't write this."  Well, I did write this, but Al Gore invented the Internet so I could post it.

More - Legal Insurrection: "Thank you Elizabeth Warren."

Those darn retroactively-obstructionist Republicans - Hot Air: "Harry Reid has trouble explaining why Democrats didn't raise taxes when they had the chance."  The pregnant pause before "next question" and the shoe-staring is priceless.

All your success are belong to us

Hit & Run: "You own a business? "You didn't build that," says Obama."

Hat Tip: Doug Ross.

Four fundraisers and a (missing) budget - Obama was busy jetting off to Texas today while the Hill reported: "Obama misses new budget deadline."  Priorities, people.

Did I say "hope"?  I meant more debt - Coyote Blog has a good post about how dumb it is for America to borrow more just because interest rates are low: "The government should borrow more money because it gets a really good teaser rate on its credit card."  If interest rates reset to historical levels, the interest on the national debt would be significant and even more so if we borrow more.

Let's hope it up - Hit & Run: "Obama descends into self-parody": "Contemplating the policy wreckage that surrounds him, the president has concluded that what this country needs is a fresh injection of presidential hope. Like "more cowbell" in the old Saturday Night Live skit, it's the magic ingredient that makes everything better."

Never is heard a discouraging word

Newsbusters: "Howard Kurtz warns CNN: Liberal media double standard apparent 'to many.'"

Really?  Because Politico recently had this hard-hitting story: "Obama likes Thin Mints."

Tell me something I don't know - Here's Laurence Kotlikoff at HuffPost: "What neither candidate will admit - Social Security is desperately broke."

Guess who loves Bain? - According to the Weekly Standard, it's Jeff Zients, Obama's head of the Office of Management and Budget.

The luster is off the Golden State

How much worse can it get in California?  The Left Coast is entering a Greece-style spiral of high unemployment, anemic growth, expanding welfare rolls, high taxes, and declining prospects:

Spending has more than doubled, from $45.4 billion in 1996 to more than $92.5 billion today. Income, sales and car taxes have all been hiked. As a result, California has the most progressive income tax system in the nation, with seven income tax brackets, and the second-highest top marginal rate.
Even with all those tax hikes, California's 2012 budget is still $15.7 billion in the red. So what does Gov. Jerry Brown want to do? Raise taxes again, of course. He has proposed a ballot initiative that would: 1) raise sales taxes on everyone and 2) raise incomes taxes on those making more than $250,000 a year (like Obama has proposed to do nationally). But even this $8.5 billion tax hike would still leave the state $7.5 billion short. Where will California get that money? Who knows?

And now America's largest pension fund - California's CALPERS - announced the fiscal 2012 return on investment was...1%.  Since CALPERS calculates pension obligations based on a 7.5% rate, this means the contribution rate for California public workers will have to go way, way up to cover the shortfall.

Gettin' culturized and sophistimicated and stuff

Yesterday I took the kids to Shakespeare & Company in Lenox, MA to see "King Lear."  What a great production with Lear played by one of the founding members of the Company.  Then we went to Northampton for dinner and there were two brave and adorable tween-ish girls playing violins outside Herrell's Ice Cream.

Now I'm watching NASCAR.  Well, it's on TNT for the mid-season races, so I'm mostly watching commercials.

His appeal is becoming more selective

I'm a huge fan of "Spinal Tap" so I just had to poach this graphic from this article:

Blaming-est President ever drives blogger to drink - White House Dossier: "Obama invokes Truman's "Buck Stops Here" quote."  Dammit, why won't Romney take responsibility for all these lies Obama keeps repeating?  Gosh.

It's always the messaging, part LXXVII - Gateway Pundit: "Obama: my biggest mistake was 'not being able to tell a good story'."  Remember America: it's not Obama's policies, it's your fault for not appreciating how great they've been.

Extra - Ace: "I regret not speaking slower and using smaller words."

More - Deploy the messaging!  Quinnipiac: "The Affordable Care Act is a tax hike, Americans say 55-36 percent."

And this - Hot Air: "Yeah. Just yesterday I was thinking, “If only he’d talked more about how awesome it is that 25-year-olds can stay on their parents’ insurance under ObamaCare, I’d totally be willing to choke on that trillion-dollar pricetag."

Remember that weak jobs report?  It gets worse - Zero Hedge: "The use of temps is outpacing outright new hires by a 10-to-1 ratio."

Get to work and pay for our entitlements! - Hit & Run: "The real class warfare is Baby Boomers vs. younger Americans."

Mitch McConnell: "Hey, let's have a vote on Obama's latest tax proposal!"
Harry Reid: "How about 'no'?"

Goshdarnit, why are those conservatives so good at messaging? - Zombie at PJ Media: "The Little Blue Book: Quotations from Chairman Lakoff."

Fun with tax rates

Writing at the Daily Beast, Michael Tomasky urges Obama to "go on the offensive" on taxes (i.e. class warfare) because the facts are on his side, assuming you frame the "facts" just right.

First, let’s have a few facts, because they help explain why continuing tax cuts for middle-income people is easier to justify. You can find the rates for 2012 here. You can find the rates for all of American history, all the way back to 1913, when the federal income tax was introduced, up to 2011, here. A person (a single filer) who was making $40,000 in 2000, the last year of the Clinton rates, and who might be making $50,000 now, has experienced very little tax savings. She’s actually paying more taxes in 2012, by a few hundred bucks, but that’s partly because her income went up. The percentage of income she’s sending to the IRS has decreased a bit.

Look at the convoluted, circuitous manner in which we're told about this taxpayer (conveniently, a woman, just like Julia.)  We don't know her overall tax rate or the total amount she paid in taxes.  Instead, we're merely told that she's paying a little less to the IRS.  As it turns out, Julia is paying about $8500 on $50,000 income or about a 17% effective tax rate.

Now imagine someone who made $250,000 then and $350,000 this year. He pays five different rates, and I won’t go through them all, but he paid a top rate of 39.6 percent on his last $106,000 earned in 2000. In 2012, though, he’s paying just 33 percent on every dollar from about $178,000 to $350,000. He’s making out awfully well—paying roughly $12,000 less per year than he would be at the old rates. A person making $1 million is paying more than $50,000 less.

Once again, we're not allowed to know the effective tax rate on Mr. $350K (it's 28.6%) or his total tax bite ($100K) - instead we're supposed to gnash our teeth over the twelve-grand he saved under the current rates.  So Mr. Rich makes seven-times what Julia makes but his tax bite is almost twelve-times higher.  He pays a higher marginal tax rate, pays more total taxes, and he and his terrible cronies pay 37% of all total federal taxes.

Oh but if we could only get that filthy lucre into middle-class hands, they would spend it wonderfully.

First, in moral terms, the current rate structure is grossly inequitable. 

How so?  Tomasky doesn't deign to explain.

But second and more important, this is about stimulating the economy. The middle-income woman is almost certainly going to take her tax savings and spend it. She probably doesn’t have the luxury of saving or investing it.

We know this...how?  This wasn't the case when rebate checks were showered on Americans.

The $350,000 earner? Well, maybe he’ll spend it on a more tricked-out and suped-up Lexus.

A $12,000 Lexus?

Or maybe he won’t. The $1 million earner? He’ll almost certainly sock away most of that $50,000, unless this happens to be yacht year.

A Lexus and a yacht?  Why I think we've tipped into class warfare.  Here's a little history for that yacht-hater Tomasky: back in 1990 Congress passed a "luxury tax" to hit Uncle Moneybags.  "Fairness" and all.  Here's what happened: the luxury tax income disappeared but unemployment obligations shot up:

According to a study done for the Joint Economic Committee, the tax destroyed 330 jobs in jewelry manufacturing, 1,470 in the aircraft industry and 7,600 in the boating industry. The job losses cost the government a total of $24.2 million in unemployment benefits and lost income tax revenues. So the net effect of the taxes was a loss of $7.6 million in fiscal 1991, which means the government projection was off by $38.6 million.

But then maybe that millionaire will sock away his money, providing more liquidity to the private market and depriving Washington of money they'll just blow on electric cars built in Finland.  Why should it matter to me how a heart surgeon spends the money he earned?  Obama's only strategy now is to divide one American against his brother and hope that the split of takers over makers will drag him over the finish line.

Well we're living here in Allentown Scranton - It looks like tourism from "The Office" didn't pay the bills.  Zero Hedge: "Scranton mayor: minimum wage for all."

Update - AP: "Judge: Scranton must pay employees full wages."

We're from the government and we're here to help - Power Line: "The subprime bust tragedy - how government-selected winners turned into losers."

Mr. "Tries real hard" is back from vacation

And ready to work!  White House Dossier has today's schedule:

Let’s take a look at this schedule for a second. Obama is planning to spend about two hours being president.

Speeches, interviews with local reporters, then two fundraisers.  You're welcome, America.

Obama campaign continues to lie, hopes nobody notices - ABC News: "Undeterred by independent fact-checkers that have debunked the thrust of their claims, the Obama campaign is redoubling attacks on Mitt Romney as an "outsourcer" in a new TV ad airing in eight battleground states."

I'm sure the independent, objective press will raise its concerns.  Ha-ha!  Just kidding.

You know you gotta blame somebody

Commentary: "Obama's excuses are getting weaker."

Awww....but he's trying real hard.

Back from camping - I'm back from a couple days sitting around the campfire reading "Death in Venice."  What a fun read!

Happy Birthday, America



See you in a couple days.

Slo-Mo-Town - Hit & Run: "Detroit has run out of other people's money": "Many cities across the country are facing unsustainable legacy costs. But Detroit is uniquely impervious to political solutions because the ratio of its public moochers to private producers is far higher than others. There are too few Detroiters with a vested interest in fixing the city and too many with a vested interest in sucking it dry. Only bankruptcy will convince them that there is nothing more to be milked."

Related - Doug Ross: "Good news: GM now owes taxpayers $35 billion."

Welcome to Carter Country!

In case you missed it - or were confused by Obama's claim that "the private sector is going fine" - U.S. manufacturing contracted last month and the threat of a double-dip recession is real.  Doug Ross notes that nobody saw it coming: "U.S. manufacturing plummets "unexpectedly"; 0 of 70 analysts predicted the recession-like numbers."  Zero Hedge says: "Houston, we have a contraction"

And so we have recoupling, with the ISM printing below 50 (i.e. contraction) at 49.7 for the first time since July 2009. Expectations of a 52.5 print were obviously blown away, as the final number came well below the lowest Wall Street forecast of 50.5.

Why is this critical?  If you're a political junkie (like me) you would have recalled a November 2011 analysis by the New York Times' Nate Silver who noted that of all the economic indicators which predict the outcome of a Presidential election, the ISM Manufacturing Index is #1.  Only one incumbent ever had to face the electorate with the ISM below zero (in contraction).

Extra - Power Line: "U.S. Manufacturing shrinking again."

More - From Gateway Pundit.

Americans still don't like this dog food

Continuing on a familiar theme, the NY Times reports on a new angle from the White House on the selling of Obamacare: it's an impossible task.

“No one in history has ever been able to communicate successfully about health care, because it is a deeply personal and polarizing issue and people are therefore afraid of the unknown,” said Dan Pfeiffer, the White House communications director. “We need the law to be fully in effect before the known overtakes the unknown.”

Really?  With such a great product, surely you can marshal the troops to get the truth out to those dumb Americans.

As [the White House] pondered plans to sell the overhaul, they found few troops to rally. Democratic lawmakers ran away from it and party donors refused to finance advertising to promote it.

Indeed, Mr. Greatest Speaker Ever spared 44 words for Obamacare in his last State of the Union address.  Obamacare is the most poorly-communicated legislation that no Democrat wants to talk about.

Extra - The President's weekly address: "Obamacare? Never heard of it."