Our Politicians and President Are Tying Up Our hands

If we're honest with ourselves the future of America is in jeopardy what with this insane spending, high taxes looming in the near future and a President that won't stand up for freedom in any of it's forms be they individual freedom for citizens to live their own lives without interference from dumb politicians or the freedom demands of other nations such as Iran and Honduras, or freedom of business owners to run their own businesses as they see fit. Read this IBD article below.

...In other words, all this spending and taxing will crater the economy — and the estimate doesn't include the spending planned for medical insurance reform and cap and trade.

Nor does it include the dizzying array of new taxes the White House and Congress are considering. They range from a European-style value-added tax, which helped turn the EU into a stagnant mess with virtually no job creation, to new taxes on health care, energy, incomes and a slew of other things.

In the coming weeks, we will tell you how we got into this mess — hint: Government played a key role — and how we can get out of it. It will take huge cuts in spending, a willingness to let bad businesses go bust, and broad tax cuts to get our economy moving again.

This, by the way, worked in the 1920s, it worked in the 1960s, it worked in the 1980s. It even worked after 9/11, and it'll work again.

America needs jobs, but its businesses can't create them as long as they remain under the thumb of a high-taxing, runaway-spending, overregulating, entrepreneur-smothering Big Government. (READ AT IBD).

Obama Will Not Only Ruin the Economy But Health Care as Well

Ruin Your Health With the Obama Stimulus Plan: by Betsy McCaughey

Feb. 9 (Bloomberg) -- Republican Senators are questioning whether President Barack Obama’s stimulus bill contains the right mix of tax breaks and cash infusions to jump-start the economy.

Tragically, no one from either party is objecting to the health provisions slipped in without discussion. These provisions reflect the handiwork of Tom Daschle, until recently the nominee to head the Health and Human Services Department.

Senators should read these provisions and vote against them because they are dangerous to your health. (Page numbers refer to H.R. 1 EH, pdf version).

The bill’s health rules will affect “every individual in the United States” (445, 454, 479). Your medical treatments will be tracked electronically by a federal system. Having electronic medical records at your fingertips, easily transferred to a hospital, is beneficial. It will help avoid duplicate tests and errors.

But the bill goes further. One new bureaucracy, the National Coordinator of Health Information Technology, will monitor treatments to make sure your doctor is doing what the federal government deems appropriate and cost effective. The goal is to reduce costs and “guide” your doctor’s decisions (442, 446). These provisions in the stimulus bill are virtually identical to what Daschle prescribed in his 2008 book, “Critical: What We Can Do About the Health-Care Crisis.” According to Daschle, doctors have to give up autonomy and “learn to operate less like solo practitioners.”

Keeping doctors informed of the newest medical findings is important, but enforcing uniformity goes too far.

New Penalties

Hospitals and doctors that are not “meaningful users” of the new system will face penalties. “Meaningful user” isn’t defined in the bill. That will be left to the HHS secretary, who will be empowered to impose “more stringent measures of meaningful use over time” (511, 518, 540-541)

What penalties will deter your doctor from going beyond the electronically delivered protocols when your condition is atypical or you need an experimental treatment? The vagueness is intentional. In his book, Daschle proposed an appointed body with vast powers to make the “tough” decisions elected politicians won’t make.

The stimulus bill does that, and calls it the Federal Coordinating Council for Comparative Effectiveness Research (190-192). The goal, Daschle’s book explained, is to slow the development and use of new medications and technologies because they are driving up costs. He praises Europeans for being more willing to accept “hopeless diagnoses” and “forgo experimental treatments,” and he chastises Americans for expecting too much from the health-care system.

Elderly Hardest Hit...(Read the whole article here).

Government Created Zombie Debtors - Another Menace

The term zombie debtors apparently was first used by Glenn Beck, but Businessweek picked up the term and wrote an article describing the menace they pose to the economy. When will we learn that government does not solve economic problems - THEY CREATE THEM. Is it our poor education system that does not prepare us to think things through logically? What the government is doing by propping up bad businesses is creating debtors that use up resources like tax money, capital and labor that could better be used by growing companies. Why prop up the unsuccessful? Government wants power and you get power by being all things to all people and making them dependent on you.

...by slashing prices to generate sales, zombie companies can drag healthier rivals into insolvency.

Sometime in the past few months, zombies went from being a latent risk to a genuine threat—one that is likely to increase in the months ahead. The Bush Administration has already ladled out billions of dollars in assistance to weak banks and automakers. As the economy goes into what may become the worst economic downturn since the Great Depression, the Obama Administration will come under even more pressure to prop up sick financial and nonfinancial companies to save jobs. The debate will center on wounded giants such as Citigroup (C), General Motors (GM), and insurer American International Group (AIG). Other sectors with their hands out include steel, airlines, retail—and homeowners, who may be the scariest zombies of all.

Japan was plagued by zombies during its lost decade of slow growth in the 1990s. Weak Japanese borrowers used the proceeds from new loans to pay interest on old ones—a process called "evergreening" that kept banks from having to acknowledge losses. In the '80s, the U.S. airline industry was pulled down by Eastern Airlines, which was allowed to keep flying (and charging low fares) while in bankruptcy court. That doesn't help anyone. "At some point, you need to wake up and accept the fact that, 'Oops, that's not going to work,' " says Stéphane Téral, an analyst with Infonetics Research who tracked the demise of scads of telecom carriers in the early 2000s.

Protecting zombies can stunt long-term growth by blocking what economist Joseph Schumpeter called "creative destruction"—the painful but necessary reallocation of resources from declining companies and sectors to rising ones. That turns out to be crucial. In the U.S. manufacturing and retail sectors, a huge share of productivity gains have come from such reallocation, says economist Steven J. Davis of the University of Chicago Booth School of Business. Case in point: the growth of hyperefficient Wal-Mart (WMT) at the expense of mom-and-pop shops, which were allowed to die. The absence of such reallocation could slow productivity growth. (READ)

"Economics Is Too Important Just To Be Left to the Economists."

There is a fallacy among economists which says that "what might be a good course of action for an individual can lead to disaster if widely adopted by members of the larger group. In this case, disaster could be the result if there was too strong a preference for savings over consumption." Andrew B. Wilson in his column today at the Wall Street Journal ("Thatcher Wouldn't Have Gone Wobbly on Detroit") says that what is good for an individual in these times, saving his capital, IS good for the country. And he sites the example of Margaret Thatcher and how she saved Britain's economy with her good sense and basically told the "economists" to take a hike.

While the automakers are clamoring to take out more loans for their bankrupt industry, Americans are using their common sense and trying to STAY OUT of bankruptcy. Our government - Obama - is also talking of: "...spending hundreds of billions on public works with the hope of creating some jobs, but remember: 93.3% of Americans, though shaken, already have jobs." What's going on here? Where is common sense? But then politicians never did have common sense just the desire to get reelected again and again. Read this column.

It reminds me of the open letter that 364 economists addressed to British Prime Minister Margaret Thatcher in 1981, condemning her for daring to cut public borrowing in the midst of a recession, which was contrary to the Keynesian orthodoxy at the time. They did not accept Mrs. Thatcher's reasoning that too much public-sector borrowing and government-directed investment could only crowd out private-sector borrowing and risk-taking.

They also implicitly rejected Mrs. Thatcher's strongly held belief that both governments and individuals must be guided by fundamental rules of common sense and frugality, in good times and bad. The economists described her thinking on this score as naive.

Mrs. Thatcher spurned the collective wisdom of the 364 economists, seeing their advice as just more of the same failed interventionist policy prescriptions which the country had followed for over three decades.

...But Thatcherite principles remain as valid as ever. The freedom of the marketplace is still the only effective mechanism for eliminating poor business practices, identifying productive investment, and providing long-term growth.

...Yet by sticking to her policies of lightened regulation, reduced trade barriers, privatization of a raft of publicly owned companies, reduced taxation, and the adoption of laws to prevent abuses of union power, Mrs. Thatcher achieved something few if any of today's economists have begun to consider. She achieved a genuine, productivity-led recovery that transformed Britain from perennial basket case into the Europe's most improved and vibrant economy.

What we need is a Mrs. Thatcher who is not afraid of the medicine we need to take to cure the symptoms of decades of abuse of our economy. Obama, the pragmatist, IS NOT that person.

Obama or McCain - What Difference Does It Make?

Will we ever get a candidate that is truly a maverick? ....Someone that will change the face of government and bring us back to our Founders' ideal of limited government? Both McCain and Obama are altruists who call on Americans to sacrifice, sacrifice and more sacrifice. This is the mantra of 20th and 21st century politics. Instead of following the delimited role of government as described in the Constitution, our politicians make themselves out as our saviours. So while government has created all the financial messes we have had in the past 100 years government also tells us that they will save us if we also sacrifice. We the people must stop agreeing with them. We must tell them to do what they are supposed to do and to stop messing up our private lives. STAY OUT OF THE ECONOMY! McCain and Obama is no choice at all - it is more of the same old politics of messing up our lives.

As the 2008 presidential election nears, and while John McCain and Barack Obama struggle to distinguish themselves from each other in terms of particular promises and goals, it is instructive to observe that these candidates are indistinguishable in terms of fundamentals.

On the domestic front, McCain promises to “take on” the drug companies, as if those who produce and market the medicines that improve and save human lives must be fought; he promises to ration energy by means of a cap-and-trade scheme, as if the government has a moral or constitutional right to dictate how much energy a company may purchase or use; he promises to “battle” big oil, as if those who produce and deliver the lifeblood of civilization need to be defeated; he promises to “reform” Wall Street, as if those who finance the businesses that produce the goods and services on which our lives depend are thereby degenerate; he seeks to uphold the ban on drilling in ANWR, as if the government has a moral or constitutional right to prevent Americans from reshaping nature to suit their needs; and so on.

Obama promises to socialize health care (under the tired euphemism of “universal health care”), as if insurance companies, doctors, and patients have no right to use or dispose of their property or to contract with one another according to their own judgment; he promises to increase the minimum wage, as if employers and employees lack those same rights; he promises to pour taxpayer money into “alternative energy,” as if the government has a moral or constitutional right to confiscate money from productive citizens in order to subsidize tilting windmills; he promises to force oil companies to fund government handouts to Americans, as if the owners of oil companies have no right to their property or profits; he promises to bail out homeowners who cannot pay their mortgages, as if the government has a moral or constitutional right to make some people pay for the financial mistakes or hardships of others; he promises to “incentivize” students to do “community service” by offering them taxpayer-funded college tuition, as if the government has a moral or constitutional right to do so; and so on.

In regard to foreign policy, McCain promises to “respect the collective will of our democratic allies,” as if America has no moral right to defend her citizens according to her own best judgment; and he promises to finish the “mission” of making Iraq “a functioning democracy” even if it takes “one hundred years,” as if the U.S. government has a moral or constitutional right to sacrifice American soldiers to spread democracy abroad.1

Obama promises to uphold the idea that “America’s larger purpose in the world is to promote the spread of freedom. . . . dignity, and opportunity,” as if we have a moral responsibility to minister to the uncivilized and the unfortunate across the globe; and he promises to negotiate with jihadists who chant “Death to America,” as if Americans will be safe from these lunatics when the lunatics give Obama their word.2

Looking past the particular programs of McCain and Obama, and viewing their goals in terms of the purpose of government presumed by these goals, we can see that both candidates hold that the purpose of government is to manage the economy, to regulate businesses, to redistribute wealth, to bring freedom or democracy to foreigners, and to defer to the will of others on matters of American security.

But this is not the proper purpose of government. Nor is it the purpose that America’s founders had in mind when they formed this great country...READ THE REST OF THIS IMPORTANT ARTICLE HERE.

The United States Sky Is Not Falling

The news media sure likes to turn everything into "the sky is falling" scenario. Maybe shouldn't believe them and we shouldn't count the United States economy out yet. Gerard Baker's article at TimesOnline explains how we have been through these times before and have always come up smelling like roses. It won't be different this time.

THE DOLLAR'S IN DECLINE. GREAT NEWS! by Gerard Baker
"For the historically short-sighted, let's remember we have been here before. Between 1985 and 1995, the dollar declined by 43 per cent against the world's big currencies — somewhat more than it has in the past six years. That period was also marked by dire proclamations of the end of US economic power. But it turned out that in those years the foundations were laid for the strongest period of US economic growth in the past 35 years. (Emphasis mine)."

"If you're still sceptical, ask yourself this: is it probable that the shift in the relative value of the dollar and the euro represents a bet by the world's investors that Europe — strike-torn, productivity-challenged, demographically doomed Europe — is the world's economic future, rather than the US, or, let's say, China?..

"The first thing to be said is that the level of public sector borrowing in the US is very small. The fiscal deficit, at just over 1 per cent of national income, is smaller than in most major European countries. It's true that America faces a large long-term fiscal challenge from an ageing population. But it's a smaller challenge than that faced by most of Europe, Japan or even China.

"So if government borrowing isn't the problem, it must be the private sector that's neck-deep in debt, right? The general view is that Americans have irresponsibly fattened themselves up on widescreen televisions and gas-guzzling four-wheel drives, all paid for with easy credit.

"...The reality is this: why save when the value of the investments you own is increasing at rapid rates? The total value of mortgage and consumer debt is indeed up by a massive $5 trillion since 2001, according to the latest figures published by the Federal Reserve.

"But consider the increases in the wealth of Americans during that period. The aggregate value of houses alone is up $8 trillion. The increase in the value of stocks held either directly or through pension funds and other investment instruments is higher by another $8 trillion. That's an increase in net wealth of American households of $11 trillion in less than six years...

"All right, but isn't the US going into recession, you say? Maybe, but so what? The US is overdue a recession by the standards of the business cycle in the past 60 years. It's possible the housing market and related problems will tip America into another one. Provided the people responsible get policy right, it doesn't have to be a depression.

"So the dollar is falling for good, sound reasons that do not require a millenarian view of the global economy. It is yet another thing Americans should be thankful for."