Internet Scofflaw

President Obama’s attack on the LIFO accounting rule (removing which would result in a massive tax increase and accounting headache) is finally getting some attention. I had the story two years ago.

Wisconsin’s budget repair act saves teachers from layoffs.

UPDATE: An interesting note from that article: the only districts with large layoffs were the two that rushed through a contract before the budget repair act became law.

I’m not ignoring the debt ceiling debate. But things are moving so quickly, and with me only finding time to blog once a week or so, I just can’t keep up with it.

I will say though, that the idea that the President could go ahead and borrow more money without the approval of Congress was stupid. More than stupid, appalling. I’m glad it went away. Mostly. Apparently some Democrats are still pushing the notion.

As bad as health care nationalization is, it could be worse. Under Obamacare, at least people will still be able to hire a doctor and pay them out-of-pocket, if they can afford to do so. Under Canada’s national health care, it is illegal for an individual to pay a doctor. In Canada, you are required to get your health care from the government or not at all. (Or, as the particularly wealthy do, go abroad, outside Canadian jurisdiction.)

How long will this freedom last? Not long, if the Center for American Progress has its way. They want the IPAB (Obamacare’s cost-cutting/rationing board) to have the power to impose cost-cutting “reforms” on private health-care plans.

Granted, restricting spending by health-care plans isn’t quite the same thing as restricting spending by individuals. But once you’ve established the principle that the government may control what people can pay for health care, it won’t take long for the tyrants to apply that principle to individuals as well.

POSTSCRIPT: Moreover, this is an instructive example of how statism works. Obamacare hasn’t even gone fully into effect yet, and the statists are already plotting how to take away the next piece of our freedom. The benchmarks can move breathtakingly quickly. What today is supposedly unimaginable (as Paul Krugman says about restricting private health-care spending) quickly becomes commonsense and only an evil conservative could argue against it.

A study commissioned by the House of Representatives found that President Obama’s brakes on the Gulf of Mexico oil industry are costing 230 thousand jobs.

(Via Instapundit.)

President Obama has nominated Richard Cordray to head the new Consumer Financial Protection bureau. This is the same guy who, as Ohio attorney general, spent taxpayer funds to defend the state employees who illegally searched state databases for dirt on Joe the Plumber during the 2008 presidential campaign.

(Via Instapundit.)

It’s not hard to understand this stuff: (1) President Obama threatens tax hikes on companies that buy private planes. (2) Companies cut back on purchases of private planes. (3) The economy suffers:

Orders for durable goods drop 2.1 percent in June with weakness led by fall in aircraft demand

Obama’s much-vaunted manufacturing initiative will do little to promote manufacturing (although it will succeed in spending money, which is probably its real aim). He could have a much greater (and much quicker) effect simply by not attacking manufacturing.

(Via Instapundit.)

Why is the White House so frantic? President Obama trails the generic Republican by 8 points. But it’s worse than that: Obama only leads Ron Paul by 4.

Years of the left’s vilifying pharmaceutical companies are finally paying dividends: The pharmaceutical companies are starting to cut back on research.

Now Megan McArdle suggests that the fault lies more on the cost side of the companies’ cost-benefit equation. I don’t deny that the increasing difficulty in making progress plays an important role, but you have to take both sides of the ledger into account.

Drug research is paid for by the windfall from the rare success, and our government’s policy has been to make that windfall much more uncertain. Mind you, not by making the success itself less likely (although that could be happening too), but by limiting companies’ confidence that they will be able to financially exploit their successes. I’m not talking (just) about Obamacare; this has been going on for decades.

The White House lied when it claimed in 2009 that it was not deliberately targeting Fox News:

Newly released emails show the Obama administration communication team privately discussed whether to exclude Fox News from interviews in late 2009, despite claims at the time that the White House did not intend to snub the cable news channel.

The emails, obtained and released by watchdog Judicial Watch, pertain to a kerfluffle over whether the administration tried to lock Fox News out of a round of interviews with “pay czar” Kenneth Feinberg, who was then responsible for reviewing compensation of Wall Street executives.

Republicans have prevailed in the Minnesota budget battle. I think Dayton (the Democratic governor) was hurt by the fact that he deliberately made the shutdown as painful as he could to the public (e.g., making it impossible to buy beer) while he deemed his own personal chef and housekeeper to be essential state employees.

Political types always like to accuse their opponents of desperation while brushing off their opponent’s attacks. It’s a time-honored (if “honored” is the right word) rhetorical device that usually has no connection to whether the opponent is really desperate or not.

But this really does smack of desperation. Talking Points Memo, a leftist web site, breathlessly reports that Paul Ryan (R-WI) was spotted drinking expensive wine at a Washington restaurant. This, apparently, is a scandal, somehow.

Ryan spent his own money, of course. This isn’t like Nancy Pelosi spending millions of taxpayer money on travel (and non-travel) in a big military plane, including a hundred thousand dollars on food and alcohol. Or any number of other magnificent wastes of taxpayer money one could mention. This is a case of people spending their own money on the product of their choice.

POSTSCRIPT: Ryan’s “accuser” (if that’s the right word), apparently surprised that her nosiness attracted critical attention, doesn’t want to be part of this story any more.

A new report from the White House’s Council of Economic Advisors found that the Democratic stimulus package created or saved (ha ha) 2.4 million jobs. A simple calculation then arrives at a figure of $278 thousand dollars spent per job. (And that’s if we take the whole “created or saved” nonsense seriously; otherwise the figure would be must less rosy.)

The White House says it disputes the report, but it doesn’t really. That is, they acknowledge the estimate, but say that dividing the money spent by the jobs created or saved (ha ha) isn’t the right calculation to make. Just looking at the number of jobs underestimates the true value of the stimulus.

This is a telling argument. The Obama administration knows that it cannot justify its signature program on the basis on employment — despite that being the sole basis on which the program was sold to us — so it is moving the goalposts.

Still, is there merit to the argument? We spent $666 billion; surely we have something to show for it? No doubt we do, but it’s hard to know how much, and the White House did not offer a figure. Moreover, we should remember that a lot of the money really was wasted (e.g., on expensive signs), or was not just wasted but actually counterproductive (e.g., cash for clunkers).

Yes, he really said that:

So, when you hear folks saying “Well, the president shouldn’t want massive job-killing tax increases when the economy is this weak.” Nobody’s looking to raise taxes right now. We’re talking about potentially 2013 and the out years.

Take a look at this chart. Then tell me whether we have a revenue problem or a spending problem.

(Via Hot Air.)

Paul Krugman now says the problem with the stimulus is we had the wrong sort of stimulus:

So what happened to the stimulus? Much of it consisted of tax cuts, not spending. Most of the rest consisted either of aid to distressed families or aid to hard-pressed state and local governments. This aid may have mitigated the slump, but it wasn’t the kind of job-creation program we could and should have had. This isn’t 20-20 hindsight: some of us warned from the beginning that tax cuts would be ineffective and that the proposed spending was woefully inadequate. And so it proved.

(Emphasis mine.)

In Krugman’s recollection, he warned us from the beginning. Fortunately, we have a better record than Krugman’s reported recollection. In February 2009 he was quite positive about the stimulus that he now says he always said was the wrong sort:

Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

Back then, aid to state governments (which he now says he warned against) was “among the most effective and most needed parts of the plan.” The only problem was that we didn’t send nearly enough of it.

It will be interesting to see how Krugman goes about squaring the circle. I anticipate endless hilarity along the lines of his efforts to justify his notorious divide-by-ten error.

(Via Kaus Files.)

The Obama administration is looking to resume the same policies that brought us the housing bubble, the housing crash, and the recession:

In what could be a repeat of the easy-lending cycle that led to the housing crisis, the Justice Department has asked several banks to relax their mortgage underwriting standards and approve loans for minorities with poor credit as part of a new crackdown on alleged discrimination, according to court documents reviewed by IBD.

Prosecutions have already generated more than $20 million in loan set-asides and other subsidies from banks that have settled out of court rather than battle the federal government and risk being branded racist. An additional 60 banks are under investigation, a DOJ spokeswoman says.

Compare this with Bill Clinton’s interventionist housing policies that caused the housing bubble in the first place, and see if you can see any difference.

The most surreal aspect of the Plame-Novak-Armitage psuedo-scandal was the spectacle of watching liberal journalists pretend to be outraged by the idea that someone would leak the identity of a covert CIA operative to the press.

Leading the outrage was The Nation, which (according to The Nation) was the first publication to argue that the leak of Valerie Plame’s name was a crime:

Four and a half years ago, after reading the Robert Novak column that outed Valerie Plame Wilson as a CIA operative specializing in counter-proliferation work, I wrote an article in this space noting that this particular leak from Bush administration officials might have been a violation of a federal law . . . and (perhaps worse) might have harmed national security by exposing anti-WMD operations. That piece was the first to identify the leak as a possible White House crime. . .

The leak came from the State Department, not the White House, but never mind that. The point is that The Nation was oh-so-concerned about damage to our national security caused by exposing a covert CIA desk-jockey.

Of course, they were full of it. They didn’t care about harming covert operations, they just wanted a bludgeon to use against the Bush administration. In fact, they like to expose covert operations, as they showed today:

Nestled in a back corner of Mogadishu’s Aden Adde International Airport is a sprawling walled compound run by the Central Intelligence Agency. Set on the coast of the Indian Ocean, the facility looks like a small gated community, with more than a dozen buildings behind large protective walls and secured by guard towers at each of its four corners. . . At the facility, the CIA runs a counterterrorism training program for Somali intelligence agents and operatives aimed at building an indigenous strike force capable of snatch operations and targeted “combat” operations against members of Al Shabab, an Islamic militant group with close ties to Al Qaeda.

The Nation published the exact location of a CIA counter-terror operation in Somalia! And that tells you all you need to know about The Nation’s vaunted concern for national security.

(Via Instapundit.) (Previous post.)

William Jacobson offers President Obama’s Catch-22:

The only way for Obama to stimulate the enormous private sector job growth needed to ensure Obama’s reelection is for Obama to announce he is not running for reelection, which would unleash a wave of investment and economic activity not seen since the Great Depression.

I’ve been meaning to comment on President Obama’s decision two weeks ago to release 30 million barrels of oil from the Strategic Petroleum Reserve. There is simply no way to understand it other than as a political decision. The reserve has been tapped by presidential order twice before: for 17 million barrels in 1991, on the eve of war in the Persian Gulf (ASIDE: that was in addition to a 4-million-barrel test sale in 1990, which some commentators combine with the 1991 sale), and for 21 million barrels in 2005, in response to Hurricane Katrina’s devastation of the Gulf of Mexico oil industry.

Obama tapped the reserve for 30 million, the largest release ever, and without any current emergency. He cited Libya as the motivating emergency, but the Libyan campaign had been going on for months and oil markets had already adjusted. In fact, oil prices had fallen more than 16% during the preceding two weeks. No, the only emergency is Obama’s own flagging re-election prospects.

ASIDE: Obama was so eager to see the oil released that he waived the Jones Act to allow foreign ships to carry the oil. Recall that he would not wave the Jones Act to allow foreign ships to help clean up the Deepwater Horizon oil spill, but he would allow them to carry oil for sale when his own job was on the line. Priorities.

Obama has also gotten a lesson in economics. We hold oil in the reserve to prevent disruptions in the event of a brief crisis. We don’t have nearly enough oil to affect oil prices over any extended period of time. And that is being borne out in the oil market: crude oil prices have now climbed higher than they were before the release was announced. There was no long-lasting effect on oil prices, but we’re holding 30 million fewer barrels in the event of a real emergency.

POSTSCRIPT: I’ve assumed that the release was for purely political reasons, but it’s possible that I’m insufficiently cynical. Some oil traders suspect that insider trading was involved.

The Democratic Senatorial Campaign Committee hit up Koch Industries for campaign contributions! The company responded:

Dear Senator Murray:

For many months now, your colleagues in the Democratic Senatorial Campaign Committee leadership have engaged in a series of disparagements and ad hominem attacks about us, apparently as part of a concerted political and fundraising strategy. Just recently, Senator Reid wrote in a DSCC fundraising letter that Republicans are trying to “force through their extreme agenda faster than you can say ‘Koch Brothers.’”

So you can imagine my chagrin when I got a letter from you on June 17 asking us to make five-figure contributions to the DSCC. You followed that up with a voicemail* indicating that, if we contributed heavily enough, we would garner an invitation to join you and other Democratic leaders at a retreat in Kiawah Island this September.

Was Murray offering to lay off Koch Industries if they contributed to the Democrats, or was she just being stupid? This is Patty Murray we’re talking about, so either explanation is possible.

UPDATE: The DSCC’s response has to be seen to be believed.

Politico reports that the House might hold a vote to repeal the light bulb ban within days. Not everyone is happy:

Environmental groups and others have mounted an opposition campaign to the Republican legislation. The Natural Resources Defense Council, the Alliance to Save Energy and the National Electrical Manufacturers Association are running advertisements in Capitol Hill newspapers touting the light bulb efficiency law.

“Phasing in energy efficient light bulbs means more choices and more savings and that’s good for families, the country and the environment,” the ads say.

“More choices”, by banning choices? Orwell would be proud.

But, in a way, I hope they do fight this. This could be a very effective wedge issue for Republicans. Once people are forced into buying CFLs, which are crappy, toxic, and expensive, and which don’t last anywhere near as long as claimed, they will be pissed. Still, I’d rather just have light bulbs.

POSTSCRIPT: Politico tries to work in their slant here:

Republicans have cast the 2007 law as a “light bulb ban,” even though the language doesn’t explicitly ban incandescent bulbs.

Those dishonest Republicans, calling it a “ban” when all the law actually does is make it impossible to get them. They’re not banned, you just can’t get them. . .

UPDATE: Well, it’s the Democratic light bulb ban now.

What happens when President Obama threatens tax hikes on companies that buy private jets? Companies pull back from their plans to buy private jets:

Much has been made of President Barack Obama’s repeated demonizing of corporate jets and the people who fly on them in his June 29th press conference.

While pundits and politicians haggle over whether alterations in the depreciation schedule of corporate jets will actually have an impact on the deficit, those in the general aviation trenches are furious.

Aircraft Owners and Pilots Association (AOPO) President Craig Fuller told The Daily Caller that Obama’s comments have cast a pall over the industry, causing many who were considering buying a plane to back away from making a purchase.

While Obama is playing politics, real people are hurt. And, of course, no tax will be paid on those planes that aren’t sold. He’s managed to hurt tax revenues slightly through his demagoguery alone, without raising a penny of additional taxes.

But that’s okay. It’s an issue of “fairness“.

(Via Instapundit.)

Stephen Hayward’s post at Power Line offering a “conservative case for higher taxes” has gotten some attention. Hayward says that the effort (if indeed there has been an effort) to control the growth of government by starving it of revenue has failed. That point, I’ll have to concede.

But he goes on to say that a more effective way to control the growth of government is to make sure people feel its cost by presenting them with the bill. That is, by raising taxes.

I agree that people should feel the cost of the government. But I really think Hayward is making an argument not for raising taxes, but for a balanced budget requirement. Currently taxes are spending are entirely uncoupled, and tax hikes in isolation will do nothing to correct that.

President Obama ordinarily has no problem inserting himself into legal disputes (even as minor as a Cambridge disorderly conduct arrest) or even launching them, but when it comes to the NLRB’s astonishing and unprecedented effort to dictate where Boeing can build a new plant, he suddenly deems it inappropriate to get involved:

Essentially, the NLRB made a finding that Boeing had not followed the law in making a decision to move a plant. And it’s an independent agency. It’s going before a judge. So I don’t want to get into the details of the case. I don’t know all the facts. That’s going to be up to a judge to decide.

If he wanted to know, he could be briefed on the facts in two minutes. And since when does he care about getting the facts first anyway? This means one thing: he is for the NLRB’s action but doesn’t want to take the political heat.

Moreover, this report seems extremely plausible in light of Obama’s response to this question. The NLRB’s Boeing action isn’t an outlier, but the leading edge of a new agenda.

California’s new anti-Amazon law is a perfect example of modern leftist legislation: it hurts individuals, costs the sate $150 million in income tax revenue, and collects $0 in additional sales taxes. It’s lose-lose-lose. But it’s an issue of “fairness”!

Teachers unions have the conceit that their interests are somehow equated to the interests of children and their education. After saying it for decades, perhaps they even believe it. In fact, the two interests are very often at odds with one another.

The purpose of teachers’ unions is primarily to advance the interests of the teachers’ unions themselves, and secondarily to advance the interests of the teachers (specifically, the teachers in the union). Education is a tertiary consideration, at best.

It’s hard to find a better example than what is going on in Wisconsin:

“This is a disaster,” said Mark Miller, the Wisconsin Senate Democratic leader, in February after Republican Gov. Scott Walker proposed a budget bill that would curtail the collective bargaining powers of some public employees. Miller predicted catastrophe if the bill were to become law — a charge repeated thousands of times by his fellow Democrats, union officials, and protesters in the streets.
Now the bill is law, and we have some very early evidence of how it is working. And for one beleaguered Wisconsin school district, it’s a godsend, not a disaster.

The Kaukauna School District, in the Fox River Valley of Wisconsin near Appleton, has about 4,200 students and about 400 employees. It has struggled in recent times and this year faced a deficit of $400,000. But after the law went into effect, at 12:01 a.m. Wednesday, school officials put in place new policies they estimate will turn that $400,000 deficit into a $1.5 million surplus. And it’s all because of the very provisions that union leaders predicted would be disastrous. . .

In the past, Kaukauna’s agreement with the teachers union required the school district to purchase health insurance coverage from something called WEA Trust — a company created by the Wisconsin teachers union. “It was in the collective bargaining agreement that we could only negotiate with them,” says Arnoldussen. “Well, you know what happens when you can only negotiate with one vendor.” This year, WEA Trust told Kaukauna that it would face a significant increase in premiums.

Now, the collective bargaining agreement is gone, and the school district is free to shop around for coverage. And all of a sudden, WEA Trust has changed its position. “With these changes, the schools could go out for bids, and lo and behold, WEA Trust said, ‘We can match the lowest bid,'” says Republican state Rep. Jim Steineke, who represents the area and supports the Walker changes. At least for the moment, Kaukauna is staying with WEA Trust, but saving substantial amounts of money.

Then there are work rules. “In the collective bargaining agreement, high school teachers only had to teach five periods a day, out of seven,” says Arnoldussen. “Now, they’re going to teach six.” In addition, the collective bargaining agreement specified that teachers had to be in the school 37 1/2 hours a week. Now, it will be 40 hours.

The changes mean Kaukauna can reduce the size of its classes — from 31 students to 26 students in high school and from 26 students to 23 students in elementary school. In addition, there will be more teacher time for one-on-one sessions with troubled students. Those changes would not have been possible without the much-maligned changes in collective bargaining.

CNBC reports:

The Federal Reserve’s massive stimulus program had little impact on the U.S. economy besides weakening the dollar and helping U.S. exports, Federal Reserve Governor Alan Greenspan told CNBC Thursday.

In a blunt critique of his successor, Fed Chairman Ben Bernanke, Greenspan said the $2 trillion in quantative easing over the past two years had done little to loosen credit and boost the economy.

“There is no evidence that huge inflow of money into the system basically worked,” Greenspan said in a live interview.

“It obviously had some effect on the exchange rate and the exchange rate was a critical issue in export expansion,” he said. “Aside from that, I am ill-aware of anything that really worked. Not only QE2 but QE1.”

(Via Instapundit.)