J.S.Mill - Comments On Liberty Today

After Gitmo

The spectacle of a current President dueling with a former Vice President is really quite amusing, but it really is instructive as well. President Obama claims to be taking the high moral and ethical ground by saying that "torture" ( specifically water boarding) is against the values of the US. His claim to that high ground is contrasted by him to the Bush administration which deployed "enhanced interrogation techniques" to break down three really bad guys.

The fact is, President Obama has a similar "values challenge" which he as yet to address, simply stating it was a difficult issue. He knows that there are some truly dangerous prisoners at Gitmo who can not be tried and convicted, and yet he knows that there is also no other country (one that can be counted on to keep them incarcerated ) willing to take them. Hence, what do we do with them? This is the problem the Bush administration struggled with, and resolved by saying that we can not release them, and we can not try them in the US, so we must just hold them. Ultimately, Obama will be forced to either stay with that strategy, or release them. If he takes the later course; in my view that is a moral failure and a refusal to honor the values of our country and to exercise his duties as President to "protect and defend."

This is a dilemma, and by definition, there is no answer that satisfies competing goals. Obama may be heading towards a decision, but if that decision is to release these people, who are committed to do harm to the US; he will fail in his duty to keep Americans safe. the Bush administration made the decision to not allow that to happen, and used Gitmo (not on homeland soil) as a place to execute the least "bad" option.

Ironically, one could paint a horrific scenario that if Obama fails to keep these prisoners in custody, the perverse result could be that no soldier on the battlefield will ever want to take a "bad guy enemy" prisoner. That would be a terrible result of Obama's desire to articulate a "preserve the values" argument.

Here is to Indiana

Finally, a politician has had the courage to stand up to the Obama administration. The Indiana teachers actually have an advocate for the rule of law. Maybe some will claim that my banking background is a bias on this subject, but candidly, I am absolutely confident that I would be a rabid advocate for this issue, no matter what jobs I have had.

I am happy to see that there is going to be at least once challenge to the Obama abrogation of the rule of law. Our society is based on a belief that liberty is at the core of our society value system. Property rights were at the heart of our founding father's view of liberty. The actions by Obama's "thugs" to steal the value of the assets of the secured creditors, is a violation of a core principle for the government and the society.

I believe that we must not let this unlawful taking prevail. The socialist agenda of this administration is clear, and pervasive. It is clear that the Republicans cannot effectively accuse the Democrats of being "socialists." That said, the reality is that they are acting like they are, and, even if they individually are not, the agenda of the Obama administration is clearly and "unambiguously" the agenda of a radical.

I wrote several Blog Posts ago, that Saul Alinsky's, Rule for Radicals, is the text book for Barack Obama's agenda. I believe that each and every reader of this Blog should read that book. It defines what Barack Obama has done, and what he is doing. He is using the system, to destroy the system. And that is what is happening. Our way of life is being threatened by an administration that is out to change, not what we do, but what we are and what we believe in. That is not Change we can believe in; it is change we must resist. We are a country that is the most successful political and economic system in the world. The current administration is tearing down the core values, principles and actions that have made us great; all in the guise of reform.

Waxman-Markey

I am clearly not convinced that the Global warming arguments have been compelling, especially since temperatures over the last ten years have fallen, not risen. But, even if the temperature increases actually happened, I am still quite skeptical about their being "human caused."

On the other hand, I am one of those corporate and conservative guys who actually is concerned about maintaining control of activities that can damage the "ecosystems" in the environment. Hence, I am all for trying to manage the damage we do to air, water and earth, but I do not think it should be done at the expense of mankind's ability to flourish. Hence, any legislation that attempts to solve problems, needs to demonstrate real value; and if it is going to increase costs to the economy, I want to see how those costs are paid back in benefits in both the short and long run.

That leads me to the Obama administrtation and The Waxman-Markey legislation. The Heritage Foundation’s Center for Data Analysis has crunched the numbers and found that by 2035, last week’s version of Waxman-Markey would: 1) reduce aggregate gross domestic product (GDP) by $7.4 trillion; 2) destroy 844,000 jobs on average; and 3) raise an average family’s annual energy bill by $1,500. And this week’s version of the bill appears to have an even greater catastrophic effect on the economy.

If these statistics are correct, every American must revolt against this legislation. The steam roller of Waxman, the zealot, and Obama, the socialist, must not allow these kinds of damage to the economy to happen; all in the name of a seriously questionable science.

Torture

Maureen Dowd today in the New York Times takes apart both ends of the political spectrum. She mocks Nancy Pelosi, but then takes Dick Cheney to task on torture. It is quite clear that the Democrats are about to attempt to turn the tables on the Republicans. The Republicans can not assume that the Democrats are going to throw Nancy Pelosi "under the bus" without a good fight.

The key will be any investigation that calls out the CIA and the Bush Administration on what they did, when they did, and how they rationalized that these techniques are not torture and criminal. Candidly, I am not certain the issue of criminality is as clear as the Republicans would like us to believe. The notion that these prisoners were not covered by the Geneva Convention is a great deal easier to accept than an argument that water boarding is not torture.

I have tried to research this subject and have found a good deal of evidence and documentation that the courts in the US have many times concluded that this "water boarding" is torture. Hence, this is quite important. I think that, if the US says "we do not torture" then the Bush administration seems to have "violated" that principle. It also appears that most Republicans and many Democrats in the Intelligence inner circle, seem to have at least tacitly agreed.

The follow up question really is just as important: Is torture warranted when trying to protect the interests of the US and to save the lives of Americans. The Bush Administration seems to have concluded...Yes. The critics, including John McCain, have concluded NO!

Dealer Terminations

Wow, this whole dealer terminations issue is very difficult to evaluate. I am going to ignore, for the moment, the fact that the decisions at Chrysler and GM are being very heavily influenced by the Obama administration. The fact that we have the government driving decision making in the "private sector" troubles me a great deal, but I think that the dealer termination issue needs to be looked at in the context of the business decision making.

Quite simply, for a very long time; the best external analysts have suggested that all three of the US auto makers has far too large a network of dealers. There are infrastructure costs for supporting the less efficient dealer network that are part of the profitability problem for the auto companies. On the other hand; distribution costs are not the largest problem facing the companies. Their biggest problems have been cost of goods sold, and that means that the have both process weakness and labor costs. The auto companies have gone about as far as they can with process changes, without work rule changes; and their ability to make material labor cost changes has been seriously hampered by labor contracts that simply do not represent the basic laws of economics. 

This set of facts clearly suggest that the dealers are an inefficient distribtion channel, but is this the right way to fix the problem, and is this the right time to do it? In my view, labor costs of production are far more critical, hence, I would focus on those costs first, and then maybe they could be more competitive in the various markets where the dealers have low volumes. I would also suggest that if these companies want to survive, then the dealer network, may ultimately need to be reduced. The whole issue is one of priorities, and actions that will have the greatest impact on profitability. Cutting the dealers may be like "stomping on the ants, while the elephants are coming over the walls.

Oh, Nancy

The Nancy Pelosi debacle today in her press conference was actually pretty sad. She is clearly caught with a "mis-remembered story." I suspect that she actually is going to have a very hard time holding onto her leadership role. I do not believe that she is likely to actually be forced to step down from the Speaker role; but her leadership is going to be severely weakened.

For those of us who do not want to have the Democrats enact their political agenda, this is actually good news. They, and the Obama administration, are spending us into a future hyperinflation and a devalued dollar. Since the Republicans do not have the numbers to stop the agenda; the only chance they have is for the leadership to implode, so that the Blue Dog Democrats can actually feel empowered to stand up to the bizarre socialist like agenda.

Hence, I am not going to criticize Nancy Pelosi; I am going to cheer her on. Please attack the CIA; please continue to lie about what you knew, and when. I want you to become completely marginalized. That will be the best thing that could happen to the conservatives in Congress.

The Dollar

Today, in the New York Times. there are two OpEd pieces that focus on the "weak dollar." I find this tragically ironic, and yet hopeful. If the ultra liberal; spend tax payer money New York Times can be focused on a weak dollar; there could be hope yet.

It does not take a rocket scientist economist to figure out that when a nation starts to dilute the value of its currency, that other nations will start to question the value of holding that currency. The cause of diluted value is quite simple: it is worth less. What makes it worth less; two thinmsg: 1) there is too much of it available and 2) I am not certain that I will be able to get value from it when I "spend it."

When nations print money, they are actual printing a general obligation of that government. If they print too much money; then the holder may think that the money may actual not only not be worth as much; it may even not be worth anything if the credit of that country deteriorates ssignificantly.

Hence, not only does the country worry about inflation (the natural result of printing too much money) but it can actually fear that the country will not be able to stand behind the currency. Meaning, it could be a credit risk. 

Well, that is precisely what all the debt financed spending by the US government is doing. For several administrations, and a FED Chairman (Greenspan) the US has been flooding the world with debt in order to finance its profligate spending spree. That spending is now being outpaced by an even more "profligate socialist like" agenda from the Obama administration. Quadruple the deficit in a year? Pathetic, and tragic.

This spending spree must end, and the Congress, is all that stands in his way, and it is spineless. Hence, it is time for a tax payer revolt, and the states must lead the way.

The Photos

I am critical of Obama when I think he is wrong, and now I must applaud him for the turnaround on his decision on the release of the abuse photos. It is, in my mind, absolutely the correct decision, and I am very pleased that he has made the decision; and appears to be making it for the right reason: The protection of our military personnel.

I also believe that this decision will serve his administration well in dealing with the Islamic world at large. The outrage that would have been inevitable will be slowed. That said, the ACLU was quick to jump in and object. But then we should not be surprised. They simply do not care about the troops.

SOCIAL SECURITY & MEDICARE

I have been in a board meeting all day, so my ability to look at the news was limited, let alone write on this Blog. That said, today. like so many others just overflows with things to talk about. A classic case of the economic disaster of an economy we have is the AP report that:

"Social Security and Medicare are fading even faster under the weight of the recession, heading for insolvency years sooner than previously expected, the government warned Tuesday. Social Security will start paying out more in benefits than it collects in taxes in 2016, a year sooner than projected last year, and the giant trust fund will be depleted by 2037, four years sooner, trustees reported. Medicare is in even worse shape. The trustees said the program for hospital expenses will pay out more in benefits than it collects this year, just as it did for the first time in 2008. The trustees project that the Medicare fund will be depleted by 2017, two years earlier than the date projected in last year's report."

Now. Now, here is the irony: that "Al Gore lock box" (remember that bizarre campaign rhetoric) well that fund is such a pathetic fraud, it makes Bernie Madoff look like a bit player in the Ponzi scheme business. Those Social Security and Medicare "Trust Funds" are a total, complete and despicable shell game, and the bill is soon coming due.

Those funds are nothing more than a "lock box" that contains bonds, issued by the US Government; which means that we have borrowed from ourselves to fund the Trust Funds, but since there are no assets behind them; they are the debt obligation of the US Government. So, not only we will be spend more each year in benefits than we take in in taxes; but we will be paying also for the bonds in the trust funds.

So, on top of this transfer payment debacle; President Obama wants to add national health care for all. This is frankly, economic insanity. But then, he does not need to worry, he will be just getting out of office when these two funds expire. Good timing Mr. President.

Building a Middle Class

Vice President Biden made a speech today in which he asserted that the Unions need card check so that America can rebuild the middle class by helping unions grow. He asserts that there needs to be a "leveling of the playing field" in order to help unions organize.

If there is any doubt about the goal of the Obama administration, this speech clearly tells the whole story. First it suggest that the middle class is shrinking, which is just factually wrong. Indeed, the middle class continues to grow and it seems to be doing that with what Vice President Biden considers an "unlevel playing field."

What has happened, as the middle class has grown, is that unions have shrunk to an almost irrelevant place in the labor force. The only union growing is the one protected most from its own unfair labor practices...the one that enlists government employees. The reason labor unions want to have card check is because they want an "un-level playing field." With card check, the notion of secret ballot, disappears. Overt intimidation becomes perfectly acceptable, and indeed, unstoppable.

The middle class needs jobs, and labor unions in the work place today, represent some of the most threatened jobs in the economy. Why? Because of simple economics. Unions create a monopoly of the labor force factor of production in any firm, or group of firms. Labor, with monopoly power, now can bludgeon the company into contracts that make "labor" the recipient of monopoly profits. These types of contracts are no better for the company, than they were for US Steel or General Motors or the teachers unions. The unions can not be allowed to intimidate the work force; or we will end up re-creating the pathetic state of affairs of the auto industry throughout the economy.