Auto Bailout Stopped…For Now

It was reported this morning from Fox News that the Senate Republicans were able to block the $14 billion auto rescue package. In a story called, United Auto Workers Lash Out at GOP Senators Over Bailout Collapse, “the president of the United Auto Workers (UAW) union accuses Senate Republicans of thwarting the $14 billion auto rescue package.”

So why are the republicans opposing this, and as reported in the story above, why is the UAW lashing out at Senator Bob Corker? Well, according to a press release from Republican Senate Leader Mitch McConnell, Senator Corker and the Republicans said they would only go along with the bailout under certain conditions, which ultimately were not met. What were the conditions? “The Corker Amendment does not just encourage reform, it requires it. And it does so with crucial specificity. First, participating companies would be required to reduce their outstanding debt by at least two-thirds through an equity swap with bondholders. The Corker Amendment also requires that labor costs at participating companies be brought on par with companies like Nissan, Toyota, and Honda — not tomorrow but immediately — because it is delusional to think that a company which spends $71 per labor hour (US auto companies, with UAW union workers) could compete with a company in the same industry that spends $49 (foreign car companies, without UAW union workers)…The Corker Amendment forces necessary reforms, holds companies accountable, and assures taxpayers that these companies won’t be back for more.”

Further McConnell said, “We simply cannot ask the American taxpayer to subsidize failure…Americans are also worried about the prospect of the government intervening on behalf of some industries and not intervening on behalf of others — especially when there is no guarantee it that the interventions will work. They wonder when the spending stops. If I were to vote in favor of this bill, I would not have a good answer for them.”

For more information on what the Foreign car companies are doing to stay competitive, see this article from the Christian Science Monitor where they discuss how “in the South, host to foreign-owned plants, there is little sympathy held for Detroit.”–America’s Other Auto Industry

And for more information on what US auto makers like Ford are doing outside the US, and away from UAW contracts, see this video below from DetNews.com called “Ford’s most advanced assembly plant operates in rural Brazil.”

Voting Themselves Money Will Herald Their Downfall

On Sept. 18, 1787, after Benjamin Franklin signed the Constitution in Philadelphia, a woman reportedly asked him: “Well, doctor, what have we got, a republic or a monarchy?” To which Franklin replied: “A republic, if you can keep it.” And regarding maintaining that republic, Franklin is reported at another time to have said, “when the people find they can vote themselves money, that will herald the end of the republic.”

At about that same time, in 1787, Alexander Tyler (a Scottish history professor at The University of Edinburgh) is reported to have said this to say about “The Fall of The Athenian Republic” some 2,000 years prior.

“A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, (which is) always followed by a dictatorship.”

And finally, from a science fiction writer named Robert Heinlein, and his book called, To Sail Beyond the Sunset:

“A perfect democracy, a ‘warm body’ democracy in which every adult may vote and all votes count equally, has no internal feedback for self-correction. … [O]nce a state extends the franchise to every warm body, be he producer or parasite, that day marks the beginning of the end of the state. For when the plebs discover that they can vote themselves bread and circuses without limit and that the productive members of the body politic cannot stop them, they will do so…” They’ll vote themselves bread and circuses every time “until the state bleeds to death, or in its weakened condition the state succumbs to an invader [such as] the barbarians enter Rome.” as read on the Rush Limbaugh

Regardless of who’s saying it, it’s true, once people figure out that they can vote themselves money, then that’s the beginning of the end of that society. So please get out and vote tomorrow, but do not vote for the candidates making the biggest promises to give out money from the public coffers. Vote for “leaders who will act with integrity and are wise, good, and honest.”

Socialism Fails Every Time, We Don’t Need to Try It Again

If you have paid any attention to presidential politics in the last week, you probably heard about the discussion between Sen. Barack Obama and a plumber named Joe Wurzelbacher from Toledo, Ohio.

Joe the plumber’s question was pretty straight forward, “I’m getting ready to buy a company that makes 250 to 280 thousand dollars a year. Your new tax plan is going to tax me more, isn’t it?” Obama gave a long, drawn out answer about the supposed virtues of taking from the haves and giving to the have-nots. Then the Democrat nominee finished with this statement, “I think when you spread the wealth around, it’s good for everybody.” from ABC News Senior National Correspondent Jake Tapper

This exchange shows Obama’s love for socialism and his contempt for hard-working Americans. Apparently, despite the fact that socialism has failed every time it has been tried, Obama and the rest of the American left wants to try it again. Like Mitt Romney said at his Republican convention speech “We need change all right: change from a liberal Washington to a conservative Washington. We have a prescription for every American who wants change in Washington: Throw out the big-government liberals and elect John McCain and Sarah Palin.”

What’s amazing is that the failures of big-government socialism have been known for at least 100 years. In the early part of the 20th century, Ludwig von Mises, an Austrian Economist, wrote this about socialism:

“The second main objection raised against socialism is that it is a less efficient mode of production than is capitalism and that it will impair the productivity of labour. Consequently, in a socialist commonwealth the standard of living of the masses will be low when compared with conditions prevailing under capitalism…The only certain fact about Russian affairs under the Soviet regime with regard to which all people agree is: that the standard of living of the Russian masses is much lower than that of the masses in the country which is universally considered as the paragon of capitalism, the United States of America. If we were to regard the Soviet regime as an experiment, we would have to say that the experiment has clearly demonstrated the superiority of capitalism and the inferiority of socialism.” Socialism: An Economic and Sociological Analysis, by Ludwig von Mises 1

And I found this quote I love about the dangers of socialism on my friend Greg McMurdie’s blog:

“We are chasing an illusion of equality . . . instead of freedom under States Rights and local self-government. Many have been deluded into a fuzzy morality which holds that equality and equal rights are the same thing. Forced equality contradicts the dream to excel; smothers individuality; restricts rights; removes freedoms; legislates mediocrity; waters down courage, thrift, self-reliance and initiative; and nurtures tyranny. An all-powerful federal government is a mass denial of freedom.” Tom Anderson, Church News. 2 September 1961.

I hope American will learn the lessons from the past failures of socialism and reject Barack Obama before he and his extreme liberal policies further destroy America.


1. From Wikipedia: Ludwig Heinrich Edler von Mises (September 29, 1881 – October 10, 1973) was an Austrian Economist, philosopher, and a major influence on the modern libertarian and conservative movements. Because of his Jewish origin and his political opinions, he left Austria in 1934 and emigrated to Switzerland and eventually settled in the USA where he was a professor at New York University from 1945 until he retired in 1969.

Profits Are Not Obscene and Government Distorts the Market

In the wake of congressional, witch-hunt hearings with oil executives regarding the price of gas, John McCain has chipped in to display his liberal side once again:

“I don’t like obscene profits being made anywhere–and I’d be glad to look not just at the windfall profits tax–that’s not what bothers me–but we should look at any incentives that we are giving to people, that or industries or corporations that are distorting the market.” From Michelle Malkin.com

For 1: Profits are not obscene. As W. Cleon Skousen puts it profits are “the means by which production of goods and services is made worthwhile.”

For 2: Government intervention is what distorts the market, not law-abiding companies. In a free market, oil companies would be free to drill for and refine the oil we have at our finger tips. Government regulations prevent this free market activity and distort the market.

John McCain wants to punish oil companies for running efficient operations that turn a profit. And what is this government intervention going to do? Only make the problem of high gas prices even worse. And by putting additional tax burdens on oil companies, John McCain will be taking away dividends (profits) from every day Americans who’s 401Ks are invested in these companies (43 percent of oil and natural gas company shares are owned by mutual funds).

Of course, McCain’s policy is sounding like his good buddies int he Democrat party, like Barak Obama, who’s solution to the energy problems is to make do with less: “We can’t drive our SUVs and, you know, eat as much as we want and keep our homes on, you know, 72 degrees at all times, whether we’re living in the desert or we’re living in the tundra, and then just expect every other country is going to say OK.”

Remind me again how a liberal like McCain got the GOP nomination? Sure McCain is better than the Democrat Party nominee, but not by much. Isn’t there a better choice? Where is the conservative running for President, who believes in small government and free market solutions?

Poverty and Welfare in America

A brief history lesson, then on to today’s news. In 1994, government spending on social welfare programs was at an all-time high, over $23 billion dollars. Newt Gingrich and the Republican party ran on a platform of reform to cut waste and fraud in government (the Contract with America). After 40 years of a Democrat controlled US House of Representative (where all spending bills must originate), the Republicans won control. Despite a previous veto from President Bill Clinton, Newt and the Republicans were able to pass the Welfare Reform Act in 1996. This act…

  • required welfare recipients to meet certain conditions in exchange for government support
  • placed a lifetime limit of no more than 60 months of benefits
  • created incentives for two-parent families and discourage out-of-wedlock births
  • required recipients to work or be looking for work
  • resulted in welfare roles being reduced by 50% in most states
  • resulted in employment rates substantially increasing among welfare recipients
  • and resulted in a drop in the child poverty rate

  • Welfare spending had been skyrocketing out of control prior to the Republican sponsored reform. The safety net of public assistance had become a hammock for far too many people. The Welfare Reform act brought sensible change and a more sound fiscal policy.

    But not everyone agreed with Welfare Reform at the time it was passed; liberal groups and Democrat politicians denounced it and opposed it at every turn. And still today, Democrat Senator Ted Kennedy fights to bring back the days of big government social spending, all in the name of helping the children, of course. Just last year Kennedy said in an interview that “we have 36 million Americans that are going to bed hungry every night. 36 million Americans! And 12 million of those are children!” Click here to view a video of Kennedy’s 36-million claim.

    Now that is quite a claim. We live in a country of 300 million people, so Kennedy is saying that more than 1 in 10 Americans goes to bed hungry every night. Now I disagree with Ted Kennedy on just about every political issue, so my first instinct was to assume he was lying or grossly exaggerating. So I did some research into that 36 million figure and found out that I was right, Kennedy was lying.

    About 36 million Americans are classified by the USDA as “food insecure”, but that doesn’t mean they go to bed hungry every night. It means that at “some time during the year, these households were uncertain of having enough food.”

    As much as Kennedy hates to admit it, poverty in America has declined due to the Republican sponsored Welfare Reform. So while there are Americans in extreme poverty who go to bed hungry, that condition is extremely rare due to the blessed country in which we live and the generosity of the American people. Americans are the most selfless, generous and giving people on this planet. Whenever disaster strikes around the world, we are there ready and willing to give food, supplies, money and other aid. Where there is genuine poverty and suffering, the hearts of the American people turned to their fellow beings and their wallets are opened to help in any way they can. And shame on Senator Kennedy for implying otherwise.

    The US government reports on poverty in America, if misunderstood (or intentionally twisted by liberal Democrats), can certainly give one the wrong impression regarding the prevalence of extreme poverty. “For most Americans, the word “poverty” sug­gests destitution: an inability to provide a family with nutritious food, clothing, and reasonable shel­ter. For example, the Poverty Pulse poll taken by the Catholic Campaign for Human Development in 2005 asked the general public the question: “How would you describe being poor in the U.S.?” The overwhelming majority of responses focused on homelessness, hunger or not being able to eat prop­erly, and not being able to meet basic needs.”

    Most American’s definition of “poor” though is quite different than the US government’s definition of “poor.” Robert Rector’s latest research shows that the poor in America, when compared to the rest of the world, are actually doing pretty well. His article, How Poor Are America’s Poor? Examining the “Plague” of Poverty in America, is very interesting and I recommend the whole thing, but here are a few highlights:

  • 89 percent of the poor report their families have “enough” food to eat
  • only 2 percent say they “often” do not have enough to eat
  • 43 percent of all poor households actu­ally own their own homes
  • 80percent of poor households have air conditioning
  • Nearly 75 percent of poor households own a car; 31 percent own two or more cars
  • 97 percent of poor households have a color television; over 50percent own two or more color televisions
  • 78 percent have a VCR or DVD player; 62 percent have cable or satellite TV reception
  • If you are poor, those statistics should make you be glad to be poor in America. Rector’s piece goes into what poverty is like is the majority of the world outside the US; I’ll let you read that yourself. I am a personal witness, though, to the poverty in the country of Argentina. I lived there for two years as a missionary, and I saw extreme poverty on a daily basis. I saw large families crammed into make-shift tin huts, with no running water or bathroom facilities other than a hole in the ground. Trust me, if you are poor in America in the 21st century, you are very blessed, in terms of material well-being (not to mention living in the land of opportunity where hard work and ingenuity allows people to pull themselves out of poverty on a continual basis).

    This bring me to my next point. Rector offers two solutions in his article, either of which would eliminate 75% of poverty in America:
    1. A 40-hour work week
    2. Marriage

    A 40-hour work week: “The typical poor family with children is supported by only 800 hours of work during a year: That amounts to 16 hours of work per week. If work in each family were raised to 2,000 hours per year—the equivalent of one adult working 40 hours per week throughout the year— nearly 75 percent of poor children would be lifted out of official poverty.”

    Marriage: “Father absence is another major cause of child poverty. Nearly two-thirds of poor children reside in single-parent homes; each year, an additional 1.5 million children are born out of wedlock. If poor mothers married the fathers of their children, almost three-quarters would immediately be lifted out of poverty.”

    So you see, as with a previous blog post regarding reducing crime, the solution is not big government, the solution is stronger families.

    Forget Universal Health Care, We Need Universal Meal Coverage

  • Radio host Sean Hannity brags about going out to eat at Ruth’s Chris Steakhouse all the time, while I’ve only been there once in my life (and that was on my employer’s tab).
  • Most of my colleagues go out to eat for lunch every day, while I have to go home and eat last night’s left-overs.
  • Many of our friends eat out two, three, four times a week, while my wife and I can only afford to eat out once a month.
    Yes folks, there’s no doubt about it, there is meal inequity here in America, and it’s high time we had universal meal coverage in the United States.

    Many of today’s politicians and the voting electorate are demanding universal health care, but they are ignoring an even more fundamental need. Wat’s more basic than the need to eat three square meals a day? Nothing.

    I have a family of four and we live on a single income. We have to cut costs wherever possible in order to make ends meet. For example, despite the inconvenience, we only have one car, and as I stated above, we rarely eat out in order to keep our food bill low.

    There is a growing divide between the meals the rich eat and those meals the poor must settle for. And it’s a travesty that our government cannot provide such a basic need to all it’s citizens. I’m calling on responsible citizen’s everywhere to petition your government officials. No man, woman or child should be forced to go without adequate meal coverage. The poor should have access to Ruth’s Chris Steakhouse just as equally as the rich.

    Note from the author: I don’t know if satire is a literary device for which I have much of a talent, but this has been a meager attempt.

  • Take the Money Out of Politics: Reduce the Size of Government

    Two recent news items spark today’s column:
    1) Norman Hsu, one of Hilary Clinton’s top fund raisers, has been making headlines for his illegal activities (Clinton Expresses Surprise at Big Money Donor’s Wanted Status)
    2) Hillary Clinton Could Use Bill Clinton’s Foreign Cash for 2008 Campaign. Though it is against the law for a candidate to take political contributions from foreigners, it is perfectly legal for a candidate to use personal income earned in foreign countries (Bill Clinton has made more than $27 million from overseas speaking engagements).

    These two items have got me thinking about the Campaign Finance Reform legislation that was supposed to “take the money out of politics.” John McCain, a chief sponsor of that legislation said it’s passage would “help change the public’s widespread belief that politicians have no greater purpose than our own re-election. And to that end, we will respond disproportionately to the needs of those interests that can best finance our ambition, even if those interests conflict with the public interest.” (http://www.everything2.com/index.pl?node_id=988757)

    I don’t want to debate the points of this legislation, though I do think it is bad law and completely ineffective, as demonstrated by the two news items above. What I do want to discuss is a far better way to take the money out of politics: Reduce the Size of Government.

    The only way to take money out of politics is to take money away from the government. When a candidate wins, regardless of the campaign finance process, that winner is in control of a $3 Trillion dollar federal budget (that’s trillion with 12 zeros). Reforming the campaign finance process only addresses a symptom of the problem. The root problem is that the Federal government is too powerful and its coffers are way too bloated. As Ronald Reagan said, “government is not a solution to our problem, government is the problem.” And I love that Walter E. Williams always promotes, “the moral superiority of personal liberty and its main ingredient — limited government.”

    Now in theory, Republicans generally support limited government and Democrats usually support big government. True to the title of my blog, I wanted to get some data to quantify this and analyze the size of government under Republicans and Democrats. To do this, I plotted the size of government over the past 60 years, with size of government defined as the amount of tax revenues in proportion to the size of the overall economy. The results were not what I expected and quite fascinating.

    I expected to see the size of government going consistently up over the years, but to my amazement, it has remained relatively constant at about 20% (tax revenues are equal to about 20% of the GDP, or the federal government is controlling about 20% of the economy). While I feel this is way too high, I was pleasantly surprised to find that, over the long-run (60 years in this case), the size of government is not trending upward.

    But if you take a closer look at the data, you will see some definite trends that differentiate Republicans from Democrats. Without exception, when a Republican president is in the White House, the size of government decreases, when a Democrat is president, the size of government increases. Even more interesting is what you find if you look at two-term Republican presidents. Again, without exception, Republican presidents reduced the size of government in their first term, but increased the size of government in their second term. Democrat two-term presidents unabashedly increased the size of government in both terms.

    My theory: both parties are appealing to their base during their first term in order to get re-elected (the Republican base wants smaller government, the Democrat base wants bigger government). What I’m not sure of is why second-term Republicans change course. Perhaps it is due to a desire to build a legacy through enacting government programs. But I’d be interested to hear your theories: Why do Republican presidents reduced the size of government in their first term, but increased the size of government in their second term?

    Though second-term Republicans change course and increase the size of government, they always net, overall, a reduction. And thank goodness they do because if it was left up to the Democrats, the size of government do nothing but increase and our freedoms, in turn, would do nothing but decrease.

    Strong Families Will Reduce Crime, Not More Government Spending on Child Care

    When I first heard this story on PBS, something definitely didn’t smell right (in fact, it smelled very left-leaning). The headline of the story states, “One in Five Women Are Deciding Against or Delaying Having a Child Because of the High Cost of Child Care and Preschool.” The sub-heading then states, “Anti-Crime Group Says Greater Federal Investment in Child Care, Head Start Needed.” (source) The inference in this article is that high costs prevent parents from putting their kids in early child care and those kids without Preschool are more likely to grow up and get in trouble with the law. Says Miami Police Chief John Timoney, “when working families can’t afford good child care and preschool, all too often we in law enforcement end up dealing with their kids when they grow up.” This group’s solution: more government spending.

    Sorry, but I don’t buy it. The problem is that this article attempts to link two things that are unrelated.
    1. Women delay having children because of the high cost of child care/preschool
    2. Children without good child care/preschool are at a higher risk of committing crimes
    Both these statements might be individually accurate, and on the surface, they might seem linked, but allow me to explain why they are not related. The women who delay having children because of the high cost of child care are not the women whose kids are at risk of having trouble with the law when they grow up. In fact, studies show that the longer women delay having children, the less likely those children are to get into trouble with the law (see Freakonomics by Steven Levitt). This is because the women who delay having children for these financial reasons are generally they type of parents who care about providing a good education and wait until they feel they can provide that.

    The research above was conducted by “Fight Crime: Invest in Kids”, which, as far as I can tell from perusing their website, is an organization that believes strongly in liberal, big government policies. In the article, this group calls on congress to provide $1.5 billion (that’s 10 digits, $1,500,000,000) in additional new funding for Head Start and other government sponsored child care programs. This is on top of the $5.8 billion federal budget Head Start already has. Another article on their site demands all presidential candidates “commit to $10 billion in new spending on quality early care and education for children from birth to age 5.”

    Nowhere I read does this organization mention the importance of parents or strengthening families. Yet, investing in families would be the proper focus if they were really concerned about reducing crime and not just advancing their liberal, big government agenda. According to the White House “research has shown that youth are less likely to engage in risky behaviors (i.e. illegal drug use, violence, and early sexual activity) when they are connected to parents, family, school, community, and places of worship.” (source = White House Fact Sheet)

    Familyfacts.org contributor Patrick Fagan has also done some research to show a direct correlation between strong families and lower likelihood of teen crime.

    And here are some more facts from familyfacts.org:

  • Adolescents whose parents are involved in their children’s lives tend to exhibit fewer behavioral problems.
  • Youths who communicate, do activities and have close relationships with their parents are less likely to engage in violence.
  • Teens who frequently have dinner with their families are at a lower risk for substance use.
  • Bottom line: Strengthening families will do more to reduce crime than any government child care spending program.