As usual, the much-ballyhooed national government ”shutdown” that kept vacationers out of the national parks and attempted to keep Normandy Veterans from entering the very memorial that they themselves made possible ended last night with a whimper, not a bang, and another ineffectual kicking of the taxpayer’s can down a bumpy fiscal road.
A nation that has not adopted a proper budget in years – and that refuses to live within one anyway – still has no meaningful control over ongoing expenses, accumulated debt, or a plan for dealing with either.
Instead, in a deal only Washington insiders could regard as progress, Republicans in both Houses of Congress caved in and, together with Congressional Democrats, passed a bill, H.R. 2775, to “reopen” the “partially-closed government” at currently unsustainable spending levels for yet another three months – until January 15, 2014 – and to suspend the national debt limit until February 7. In the meantime, House and Senate “leaders” promise to appoint representatives to a conference committee to address “broader budget issues” – such as whether to replace the current across-the-board spending cuts known as “sequestration” with other purported “savings.”
This is bankruptcy on the installment plan, both moral and fiscal. The United States government is the political equivalent of an alcoholic who insists that he will sober up next month if the bartender will only increase his credit limit yet again and keep buying him drinks on the house until a week from next Tuesday. In the meanwhile the bartender’s children are in danger of missing meals and the bar’s own creditors are threatening foreclosure because the mortgage loan is nearly in default.
“Furloughed” federal workers will as usual be paid for the time that they weren’t at work, meaning an additional two weeks or so of (albeit stressful and unplanned) vacation on the tab of the same taxpayers who, if vacationing at their own expense the past two weeks, were shut out of the national parks and presidential libraries, also through no fault of their own. Congressional staff will still get huge Obamacare subsidies that the rest of the citizenry does not and the “individual mandate” of Obamacare remains in place even though the administration has delayed, waived, or gutted every other significant portion of the law for purely partisan political purposes.
What Republicans up for re-election in 2014 have to show for all this are a memorable reading of “Green Eggs and Ham” by Canadian-born Texas Senator Ted Cruz – who ultimately refused to block the legislation that he initially pretended to filibuster – and a popularity rating lower than the keel of the Titanic on April 16 of 1912. Meanwhile President Obama quickly signed the bill and, of course, proclaimed victory. Although also taking a temporary hit in popularity but not subject to re-election, he wisely remained largely above the fray and accordingly felt free to lecture the nation this morning that the only things standing between the people and the nirvana of cradle-to-grave government are citizenship and voting rights for people who have entered the nation illegally, “closing corporate tax loopholes that don’t create jobs” and – in our post-industrial information technology-based economy – a new farm bill.
On the whole, the country is worse off than back where we started, having been subjected to further abuse by a non-responsive and irresponsible government and a few steps further down Friedrich von Hayek’s fabled road to serfdom.
As Tennessee Ernie Ford once plaintively lamented, “You load sixteen tons, and whaddya get? Another day older and deeper in debt.”[Image originally posted on macromike.com]
Thanks to the wonder that is the Internet, you don’t have to actually live in San Diego to watch a 30-minute special that aired in that city last Sunday that gives a thorough debunking of the climate scare.
Below, you will see what the lucky residents of San Diego enjoyed via the great KUSI-TV and the Founding Father of The Weather Channel, John Coleman … just without the other benefits of living in one of the most pleasant cities on the planet. You’ll just have to count all your other blessings.
Coleman interviewed two of the lead authors of Climate Change Reconsidered II: Physical Science, Fred Singer and Bob Carter. Both are part of the Nongovernmental International Panel on Climate Change (NIPCC) — the organization of some 50 scientists that have applied (gasp!) the scientific method to the political science of the UN’s IPCC … and have found the “science” in their latest climate report wanting. But the IPCC is more interested in political science than climate science, so it’s easy pickings for NIPCC.
The 1,015-page Climate Change Reconsidered II: Physical Science has been making waves across the non-warming globe, and the undertow is infinitely annoying to the eco-left. But as Shakespeare wrote: The truth will out.
View climate truth below:
Consider for a moment what will come next for Obamacare, in the context of Ezra Klein’s five thoughts on the disastrous launch of the program – a bellwether of sorts for how the administration failed to live up to the expectations it sold to the law’s supporters and opinion leaders. There are a few different directions it can go from here, but the worst case scenario hasn’t really entered people’s consciences yet, in part because the insurers are staying quiet at the moment. The reality now is that the system is at least a month from actually working, and likelier two or (gasp) three, given the enormous range of problems. And that could make for a real disaster.
As it stands today, at most nine of the state exchanges are working… but while some systems are being announced as “fixed” on the state level, fixed in this case means the ability to look at plans, not to actually enroll. And the fundamental breakdown for the federal exchange hangs on a decision designed to insulate people from the true cost of plans – an approach which is now backfiring given the load it places on the website. The whole storyline is marked by a disturbing failure of basic technocracy: according to the New York Times, as late as the last week of September, HHS officials were still debating aspects of the site, including that requirement making customers register before shopping for insurance.
Democrats are scrambling for excuses: there wasn’t enough money or time. The decision to delay controversial regulations til after the 2012 election slowed the process. The Republican governors ruined efforts by opting not to implement exchanges. The suggestion that cronyism played a role in the contractor process is already being advanced. But cronyism or no, the decision of those at CMS/HHS to take the lead in organizing the program – despite an enormous absence of institutional experience – may be the real source of the problem. Megan McArdle outlines the reality:
I’m a longtime critic of federal contracting rules, which prevent some corruption at ruinous expense in money, quality and speed. But federal contracting rules are not what made the administration delay writing the rules and specifications necessary to build the system until 2013. Nor to delay the deadline for states to declare whether they’d be building an exchange, in the desperate hope that a few more governors might decide – in February 2013! – to build a state system after all. Any state that decided to start such a project at that late date would have had little hope of building anything that worked, but presumably angry voters would be calling the governor instead of HHS. Federal contracting codes, so far as I am aware, do not emit intoxicating gases that might have caused senior HHS officials to decide that it was a good idea to take on the role of lead contractor – a decision equivalent to someone who has never even hung a picture deciding that they should become their own general contractor and build a house. Nor can those rules explain their lunatic response when they were told that the system was not working – “failure was not an option.”
But whether these excuses work with the public or not, the worst case scenario for Obamacare is now entering the realm of possibility: what if it just doesn’t work, and continues not to work, a month from now? The deadlines for achieving coverage are approaching fast. The political reality is that it’s impossible to legally require people to sign up for something when the system just won’t let them. If a month from now we are still seeing a fail rate of significance within these systems, where people trying to enroll are turned away as often (or more often!) than they get through, the pressure from non-partisan actors is going to explode for a delay of major aspects of the law. It will be a murmur at first, but if it continues to grow, there will have to be a Congressional response.
One factor to consider here is that the consultants involved for the federal and state exchanges have a good deal of overlap. It would be one thing if it were just a few states having issues – they could prioritize the major states over the minor ones – but the fact that the problems are worst for the federal exchange means none of the states are going to get significant attention until that’s taken care of. This could mean smaller states get attention last, leaving their citizens incapable of purchasing the coverage they’re legally required to get. The potential for legal challenges coming out of this is massive if the mandate/penalty is not delayed. But to solve the practical problem requires steps beyond just the individual mandate delay or extending open enrollment for the entire year – we’re talking about actually taking the exchanges offline (insurers would presumably honor the handful of plans already sold through them) in order to fix them. That process could take months of work and millions more in taxpayer dollars… and set us up to do this whole thing again in October of 2014.
So what’s the worst case scenario? Honestly, it’s this: if this is as big of a failure as it looks like at the moment, and the problems are not fixed within the next two months, the Obamacare project could end up backfiring in a way that could have dramatic effects on politics and policy going forward. It will contribute to distrust in government’s basic capability. It will fail to live up to its promise, and wreck the insurance markets for no good purpose. It will represent the administration betraying its strongest supporters. And it may ultimately leave President Obama wishing John Roberts had ruled the other way – turning him into a martyr for the cause as opposed to putting the burden of proof on actually implementing his signature policy.[Originally posted on the Federalist]
When you open your monthly bill from Visa V +1.11% or Mastercard, have you ever thought of telling the credit card company you cannot possibly pay even the minimumbalance due, and you are going to have to default on the debt, unless the company immediately increases your credit limit? What do you think your creditor would tell you if you did? Would you expect to get the increase in your credit limit that way?
That is the same silly, illogical argument that your President Barack Obama is peddling to the entire country, to considerable success, given the fundamental breakdown in this generation’s ability to handle self-government. Not raising the debt limit does not mean defaulting on the national debt, any more than not increasing your credit limit means you can’t pay your monthly credit card bill, and must default on that.
As the outstanding federal debt becomes due, it can simply be paid by newly issued debt, without violating the debt limit, as the total outstanding debt would not change. President Obama’s own budget estimates total net interest on the national debt for this year currently totals $223 billion. But his budget also estimates total federal income taxes for this year at $1.7 trillion, or $1,700 billion. So just as you use a small portion of your monthly earnings to pay your credit card bill, current federal tax revenues are more than enough to pay the current interest due on the national debt. So not increasing the national debt does not mean defaulting on the national debt. QED.
But our party controlled press, like the WashingtonPost and the New York Times, which behave voluntarily in regard to the Obama Administration just as Pravda did under compulsion in regard to the old Soviet dictators, foolishly echo this Obama party propaganda, “reporting” that default on the national debt is imminent unless Congress increases the debt limit. Even some conservative commentators have been buffaloed into lamely repeating that such default is at issue in the debt limit debate. There should be personal liability for commentator malpractice.
But President Obama says without increasing the debt limit, he cannot cover all of the federal government’s spending for the year, and he cannot decide what to prioritize to spend the continuing federal income on first. But this is why with no executive experience, or any other experience except rabble rousing, he had no business running for President in the first place.
As a former Associate Deputy Attorney General of the United States, a member of the Bar of the United States Supreme Court, and an honors graduate of Harvard Law School, in my opinion it would be an impeachable offense for President Obama to default on the national debt in violation of the Constitution when he has the available resources. Perhaps the House Judiciary Committee opening impeachment hearings and taking testimony on this point would help President Obama decide how to prioritize.
But President Obama says Congress must raise the debt limit just to pay the bills we already owe. But if you gain a credit limit increase on your credit card, and you charge still more, is that paying the bills you already owe? Or is that racking up still more bills?
Similarly, raising the debt limit so the federal government, with nearly $17 trillion in national debt (more than our entire economy), can borrow still more does not involve paying the bills we already owe. It means racking up new bills to be paid in the future, by our kids. At best, if the increased borrowing is used to pay current federal bills owed, that involves deferring payment of current obligations, not paying what we already owe.
But President Obama is doing a good job of just confusing and manipulating the American people on this issue, as too many voters do not understand federal finances. But that does not mean they refrain from voting when they don’t understand the issues.
The latest news is that Senate Democrats are demanding to increase the debt limit and reopen the government that Republicans agree to replace the sequester spending cuts with tax increases, and to scrap the long term budget caps adopted in the 2011 debt limit deal. President Obama has been calling for precisely that all year, and it is in the Senate Democrat budget passed earlier this year.
The sequester and the spending caps have amounted to the most successful federal budget restraint in 50 years. Under those policies, total federal spending in actual, nominal dollars has actually declined for two years in a row, which almost never happens even for one year, and has not happened for two consecutive years since the end of the Korean War. The Wall StreetJournal reported yesterday that through the first 11 months of the 2013 fiscal year, federal spending was down $127 billion over last year. The sequester and the budget caps now require still more spending cuts for 2014.
This debate clearly defines a difference between the two parties. The Democrats want to repeal and replace the spending cuts with still another tax increase. The Republicans won these budget cuts in the 2011 debt limit deal, and to President Obama’s shock, they want to keep them (though there are big spending Republican dissenters).
The Republican House majority in fact does have the power to resolve the debt limit impasse, and the government shutdown, on their own, if they would just wake up. But that would involve explaining to the American people how passing a federal bill works, and if you have to depend on the Republicans explaining anything, you can just forget about it.
The Republican House majority should just pass the debt limit increase as they want it, with the sequester and the budget caps all remaining in place. They do not need agreement from President Obama or Harry Reid to do that. If the Democrat majority Senate disagrees, they can just go pass the debt limit increase bill as they favor it. Then the regular, established procedure for enacting legislation is for the House and Senate to both go to a Conference Committee and work out the final compromise.
If the House leadership would just pass the debt limit bill as they prefer it, they can explain to the nation that they have done their job, and they are waiting for the Democrats to act. Then if the Democrats do not pass their bill, or do not show up at the Conference Committee, then it will be clear to the whole country who is responsible for failing to raise the debt limit. If the House Leadership cannot get this, then they must be replaced. Newt Gingrich is still eligible to serve as Speaker, and I am sure he can explain it to the public. This same procedure is available if a short term agreement has extended the debt limit debate to a later date.
Of course, President Obama can then still veto whatever the Conference Committee comes up with. But then it would be clear exactly who is refusing to raise the debt ceiling, even in the face of a bipartisan Congressional agreement on the issue. And if he is going to be blamed rather than the Republicans, he will yield.
The exact same procedure can and should be used to resolve the government shutdown issue, now or at the time to which any short term agreement has extended the issue. The government is regularly funded by 13 or more appropriations bills, not by Continuing Resolution (CR). It is the CR that puts the shutdown of the entire federal government at issue, because the CR is inherently an all or nothing measure.
What House Republicans need to do is finish passing the rest of the Appropriations bills on an expedited basis, under closed, accelerated rules. Then the Republicans can explain to the nation that they have fully funded the government, and that nothing further can move forward until the Democrat majority passes their Appropriations bills, and then the matter goes to the Conference to resolve any issues. If Senate Democrats do not pass their Appropriations bills, or show up at the Conference, then it will again be clear to the entire nation who is responsible for the government shutdown.
Democrats have said they will not fund the government piecemeal, only all or nothing. But contrary to this posturing public manipulation, the federal government is regularly funded piecemeal, through this appropriations process.
The government has been shutdown only because President Obama and the Democrats have been so sure that the Republicans will be blamed for it. Once Obama and the Democrats are themselves put on the spot, through the Appropriations process, then they will quickly agree to compromise the issues.
Through that Appropriations regular order, the Republicans can even still pursue defunding Obamacare, because they could do so making only the HHS Appropriations bill the issue, meaning only HHS would be shut down (possibly the IRS and the Office of Personnel Management too). That is another advantage of restoring the Appropriations regular order.[Originally published on Forbes.com]
The news on Monday, October 7th, included a notice that Heather Zichal would be leaving her White House job as Obama’s “top adviser on environmental and climate issues.” And I asked myself who is Heather Zichal?
In fact, Ms. Zichal had served in an advisory position for five years. In her current position, she replaced the “climate and energy czar”, Carol Browner, who left in March 2011. Browner had formerly been the Director of the Environmental Protection Agency where she did her best to impose some of the most draconian environmental policies; a task taken up by Lisa Jackson until she recently stepped down and was replaced by Gina McCarthy. It says a lot about this agency that during the government shutdown, it furloughed 93% of its employees as “non-essential.”
In July Rep. Lamar Smith (R-TX) penned a Wall Street Journal’s commentary, “The EPA’s Game of Secret Science”, noting “As the Environmental Protection Agency moves forward with some of the most costly regulations in history, there needs to be greater transparency about the claimed benefits from these actions. Unfortunately, President Obama and the EPA have been unwilling to reveal to the American people the data they use to justify their multibillion-dollar regulatory agenda.” Rep. Smith is chairman of the House Committee on Science, Space and Technology.
Ms. Zichal has managed to maintain a very low profile during her White House career. Trying to find articles that profile or quote her turned out to be a real task. Part of the reason for this may be her political instincts and experience. She has been active since her days in college following a duel track of politics and environmental issues. She quickly came to the notice of Democrat Rush D. Holt, Jr. (NJ) when she was an intern at the state chapter of the Sierra Club and he was running for office. Holt hired her as a legislative director.
Ms. Zichal would later hold the same position for Rep. Frank Pallone from 2001-2002 before serving Senator John Kerry from 2002-2008. She would be an advisor to Kerry’s 2004 presidential campaign and the 2008 Obama campaign. Throughout her career she has been devoted to the global warming/climate change hoax. After Browner’s departure, she served on the White House Domestic Policy Council because Congress abolished the funding for Browner’s position in an agreement that averted a government shutdown in 2011
In what appears to be a rare interview, prior to the 2008 election Ms. Zichal was profiled in Grist magazine, an environmental publication. She spouted all the usual nonsense about greenhouse gas emissions, “clean coal”, and “how a President Obama would craft a bipartisan plan to address climate change.” At the time she said that Obama’s “climate and energy policy go hand-in-hand. His goal would be to try and move climate legislation in tandem with energy legislation.”
She was correct in that prediction and the result has been an all-out war on coal with the EPA relying on hidden, bogus “scientific” data to justify it. In the Grist article, Ms. Zichal said that Obama would call for “an aggressive 80 percent emissions reduction.” Since there has been no warming trend since 1998 and no connection between carbon dioxide and the non-existent warming, the need for such a reduction is zero.
Despite the administration’s best efforts, the energy sector, other than coal, has been growing as the result of the fracking technology that has made recovery of the nation’s vast oil and natural gas reserves possible. Along the way the administration wasted billions on loans to so-called “renewable” wind and solar energy companies, most of whom quickly went bankrupt.
Energy industry expert, Robert Bradley, Jr., writing on the Master Resource website in June 2012 took note of a Greenwire—Energy & Environmental News—profile of Ms. Zichal noting that, for all her talk about “outreach” to sectors of the energy industry, “we have the irony of Ms. Zichal trying to square the circle of real consumer-driven energy vs. politically correct energy.”
In point of fact, Ms. Zichal has been a behind-the-scenes player in the Obama administration’s advancement of the global warming/climate change hoax, in efforts to shut down coal-fired plants, and thwarting access to the estimated ten billion barrels of oil in Alaska’s Arctic National Wildlife Refuge, along with other ways to limit the production of energy the nation requires.
The recent report by the UN’s Intergovernmental Panel on Climate Change finally admitted the fact that the planet has been in a cooling cycle for nearly seventeen years. The report has been thoroughly discredited as regards the “science” it has been citing; based almost entirely on rigged computer models.
The White House cited Ms. Zichal for the work she has performed there, “most recently developing our bold climate action plan”, saying she will be missed. The notion that the White House or any other entity on Earth could do anything about the climate is absurd.
“Heather will be missed here at the White House, but our work on this important issue will go on”, said the announcement of her departure. I’m guessing that she will find a new job with the Sierra Club or some similar environmental organization devoted to harming the best interests of the nation.
Obamacare and ethanol—hand-in-hand
Poll after poll shows that the majority of Americans have an unfavorable view of Obamacare. If it were front and center of the newscycle, as Obamacare is, most would also have the same repeal-or-revise attitude regarding ethanol mandates as the two are marching hand-in-hand. In addition to the odd collection of opponents—conservatives and unions in opposition to Obamacare; and environmentalists and big oil, auto manufacturers and anti-hunger groups oppose ethanol—there are numerous other similarities.
Sounds good at the start
Healthcare for all sounds like a good idea, after all who wants to tell a mother holding a sick child that she can’t get care? Likewise, homegrown fuel that will increase America’s energy independence, sounds good—especially when the Renewable Fuel Standard (RFS) was passed by Congress as part of the Energy Policy Act of 2005. The RFS mandates a minimum volume of biofuels (generally corn-based ethanol) is to be used in the national transportation fuel supply each year. Two years later, the Energy Independence and Security Act of 2007 greatly expanded the biofuel mandate volumes and extended the date through 2022. The expanded RFS required the annual use of 9 billion gallons of biofuels in 2008, rising to 36 billion gallons in 2022, with at least 16 billion gallons from cellulosic biofuels, and a cap of 15 billion gallons for corn-starch ethanol.
At the time, US oil imports were growing, fears of shortages due to so-called peak oil were rampant, and the combined technologies of horizontal drilling and hydraulic fracturing weren’t yet widely used and had not unleashed the current abundance of US resource. Growing our gasoline—converting corn from the heartland into ethanol—sounded good. Today, the Renewable Fuels Association claims that the RFS has reduced America’s foreign oil dependence. Perhaps that is true, but unlocking federal lands, expediting permitting for drilling, and approving the Keystone pipeline could totally remove our reliance on Middle Eastern oil in as few as three years.
Have had their day on court
Virginia Attorney General, and gubernatorial candidate, Ken Cuccinelli was the first to file a lawsuit against Obamacare—which the Supreme Court ultimately declared a tax. On October 8, the American Petroleum Institute (API), once again, filed a lawsuit in the DC Circuit Court against the Environmental Protection Agency (EPA) over the RFS volume requirements for 2013. A similar suit was filed in 2012. On January 25, 2013, the US Court of Appeals rejected EPA’s 2012 mandate for refiners to use cellulosic biofuel, which was not commercially available. In response to the court’s decision, Bob Greco, API Group Downstream Director, said: “This absurd mandate acts as a stealth tax on gasoline with no environmental benefit that could have ultimately burdened consumers.”
Non-elected bureaucrats setting policy
While both Obamacare and the RFS were passed by Congress, the particulars are left to government agencies to regulate. With the RFS, the EPA has missed statutory deadlines for issuing RFS volume requirements and then released rules mandating that refiners use 4 million gallons of cellulosic biofuel in 2013. Yet, according to the EPA, only 142,000 gallons have been available for refiners to blend so far. Reports indicate that for 2014, the target for cellulosic biofuel would be 23 million gallons—despite the fact that the fuel is virtually nonexistent. The EPA has ignored the 2012 Court of Appeals smack down in which Judge Stephen Williams said the law was not intended to allow the EPA to “let its aspirations for a self-fulfilling prophecy divert it from a neutral methodology” and has again set advanced biofuel targets that are out of touch with reality.
Fines for noncompliance
While the Obamacare exchanges have not been working as expected—with Blue Cross & Blue Shield of North Carolina reporting only one person enrolled after 24 hours, US Secretary of Health and Human Services Kathleen Sebelius admitted to Jon Stewart that if someone doesn’t participate “they pay a fine.” Guess what? Even though there isn’t enough cellulosic ethanol to meet the EPA mandates, refiners are required to blend it into gasoline—and, if they don’t, they pay a fine.
Creates new problems
- Ethanol reduces miles per gallon (MPG)—At a time when the White House has upped the MPG a vehicle gets (known as the CAFE standards) it is also mandating the use of ethanol, which lowers MPG. Edmunds did an apples-to-apples comparison of gasoline vs. ethanol (using a flex-fuel vehicle and E85). They conclude: “The fuel economy of our Tahoe on E85, under these conditions, was 26.5 percent worse than it was when running on gas”—and cost about $30 more. Plus, Edmunds found that the carbon emissions savings was negligible. (Note: less than 7 percent of the US vehicular fleet is flex-fuel.)
- Ethanol mandates have devastated the dairy industry (and turkey growers are none too happy, either)—In rural California, dairy farmers have been deeply affected by the rising cost of feed (which has jumped as much as 240 percent since 2005) brought on by mandated ethanol blending by the RFS. John Taylor, who owns and operates Bivalve Dairy with his family, says: “If there’s a requirement to have ‘X’ amount of tons of corn go into renewable energy, that’s just going to reduce the supply…that’s only going to make the price go up for [dairy farmers]…I’m not sure we should be taking our food and putting it into energy.”
California Assemblywoman, Kristin Olsen, reports: “The competition between the corn market and the government corn ethanol mandate is creating grave challenges for our California farmers, and their ability to feed their livestock and, ultimately, the nation.”
About the turkeys, Damon Wells, vice president of government affairs, National Turkey Federation, adds to the discussion. “Too often they’ve tried to say this was a petroleum vs. ethanol fight. I take great exception to that. I think those in the animal agriculture industry take great exception to that because all of the benefits that have come from this Renewable Fuel Standard have transferred off the backs of small farmers all across this country that are feeding livestock and poultry and ultimately it’s a transfer of cost from one agricultural sector to another.”
- Ethanol damages small engines and outdoor power equipment—In my book Energy Freedom, I have an entire chapter on ethanol. For it, I interviewed Abe at K & S Services Center in Albuquerque, NM—which specializes in small engine service and repair. He told me that 85 percent of the repairs they do are caused by fuel problems. Because of the increased ethanol in the fuel available at gas stations, Abe’s had to change his warranty policy and the center no longer warranties fuel-related damages. For his customers, many of whom are in the lawn-care business, the ten-percent ethanol in gasoline doubled their repair costs until they learned about its hazards and quit using it—converting to more expensive (but cheaper in the long run) pure gasoline.
Kris Kiser, president and CEO, Outdoor Power Equipment Institute, affirms Abe’s observations: “Our small-engine industry and products … is sort of where the RFS meets reality. … you’re introducing fuel to the marketplace for which all of this stuff is not designed or warranted to run on. … You have product failure. Failure can mean economic failure or it can mean safety failure. … There’s a half-billion engine products in the marketplace today not built or warranted to run on E15.”
Hard to remove once policy is in place
Whether or not you agree with Ted Cruz’s tactics regarding stopping Obamacare, you likely agree with this statement he made about it: “In modern times no major entitlement, once it was implemented, has ever been unwound.” Surprise! The same can be said about the RFS. My friend and colleague, Paul Driessen has penned an excellent column on ethanol in which he addresses “how hard it is to alter policies and programs once they have been launched by Washington politicians, creating armies of special interests, lobbyists and campaign contributors.”
We surely see what Driessen is talking about in an October 11, letter from Governor Terry Branstad (R-IA), published in the Wall Street Journal. In Ethanol Promotes Consumer Choice, Branstad defended the benefits of his state’s leading crop: “It is the ethanol industry, which makes a cheaper, cleaner and higher-octane product, that is ready, willing and able to face free-market competition.” To which a reader, Charles Pierce, responds: “I do not know what planet the Governor is living on but when the Federal Government forces the adding of ethanol to motor fuels there is no choice. It is just like the PPACA [Obamacare] it is a tax that is paid by each consumer being forced to buy a product that the government set up or likes. Want free choice; want cheaper motor fuels? Make it an option, not a mandate.”
When Republicans who generally oppose mandates and subsidies, like Gov. Branstad, Sen. Grassely, and Rep. King, support continuing the RFS, we can surely see the influence of “special interests, lobbyists and campaign contributors,” as a result of federal involvement in what should be a market-based solution.
“Despite over 7 years of effort and the expenditure of about $603 million, the Department had not yet achieved its biorefinery development and production goals,” a report released in September revealed.
It is time to repeal—or at least revise—the costly RFS boondoggle. Fortunately such a plan is on the table. The RFS Reform Act, co-sponsored by both Democrats and Republicans, proposes to eliminate the conventional biofuels mandate and cap the amount of ethanol that can be blended into the fuel supply. Call your Senators and Representatives and tell them to end this eight-year-old policy failure.
We may not be able to repeal Obamacare, but with your help, reforming the RFS can be a reality.
[First Published By Townhall]
This year’s prize goes to three economists who made contributions to the pricing of speculative assets such as stocks. Eugene Fama, of the University of Chicago, and the oldest of the three, is best known for his development of the efficient markets hypothesis. Lars Peter Hansen, also of the University of Chicago, and the youngest of the three, for exploring the “boundedness” of market processes, both in theory and in empirical estimation. Robert Shiller, of Yale University, has explored the behavioral underpinnings of price determination, arguing that market prices often over-react to changes in fundamental value.
Fama’s efficient market hypothesis is today a textbook standard. It negates the profitability of “technical analysis.” Market prices reflect all past, publicly-available information, and perhaps even private information, and certainly reflects any potential information in stock market patterns (such as “triple bottom,” said to be a prediction of a “breakout” and a “buy” signal). But, doesn’t the efficient market hypothesis disprove itself, as who, if nobody can profit from buying or selling stocks based on information, impounds information into stock prices? To more precisely say that, at the margin, market prices reflect all past, publicly-available information is almost to admit that there are times when stock prices don’t; i.e., when stock prices are “infra-marginal;” or, when the capital available to those who rationally-value stocks is insufficient for them to bring price to value. In his later years, Fama himself seemed to challenge his earlier work in his collaboration with Kenneth French, with the “three-factor” model. In the three-factor model, small cap stocks and stocks with exceptionally high ratios of market to book value, along with systematic risk, are shown to affect stock prices. To be sure, the three-factor model might reflect an underlying multi-factor model of stock price determination, and have nothing to do with information-efficiency.
Shiller’s work is both more recent and on-going, and part of a broad line of inquiry concerning the impact of psychological factors, even irrationality, on stock prices. Why, for example, do we observe “booms” and “busts” in markets in speculative assets, including real estate as well as stock markets; or, “balloons” or “bubbles,” followed by their “bursting.” Even more so, why is the bursting of a bubble in real estate and in stocks so often followed by a recession, or even by a long period of depressed economic conditions? In some early work, he appeared to challenge the efficient market hypothesis head on, arguing that stock prices were more volatile than could be justified. The Crash of ’87 seemed to validate his argument and instigated concerns for “behavioral foundations” and “market microstructure” and such. Shiller’s book “Irrational Exuberance,” taking off on an expression coined by Alan Greenspan, connected that gyration of the stock market to a long history of stock market behavior. Then came the calamitous collapse of the stock and real estate markets during 2008.
Hansen’s contributions to our understanding of financial markets seems to just be getting started. Beginning with technical issues of econometric estimation, he has moved on to the more philosophical issue of the difference between risk and uncertainty. Risk, we might say, is something measurable. It comes from frequencies of occurrence in repeated trials. With sufficiently many trials, we can estimate risk. Uncertainty comes from not knowing the model out of which are coming the outcomes we observe. In a world that is changing, uncertainty can never be resolved. The question, in prudent decision-making, is robustness, as Hansen puts it in his recent book coauthored with Thomas Sargent. By robustness, I mean surviving what otherwise would be catastrophic. What doesn’t kill you, makes it stronger. But, you have to avoid getting killed.
The contributions of this year’s triplet of economists involve advances in the utilization of data, as well as the development of theory. Fama cut his teeth with the analysis of daily stock market data, involving hundreds of stocks, over long periods of time. For example, he tracked the evolution of stock prices relative to “events” such as increases in dividends. This was the “big data” of his time. Shiller constructed and analyzed very long histories of stock market prices, and – more recently – developed of indices of real estate prices (the Case-Shiller index). Hansen is a developer of “agent models,” in which computer models simulate thousands or even millions of persons organized into so many households and companies. Agent models, like climate models, have to be seeded with “parameters,” and checked against observation and “intuitive validity.” They’re not so much proofs, but explanations. They become evidence when validated against data unknown at the time of their construction.
Now that the Affordable Care Act (Obamacare) has gone into effect, the debate will shift from promises and theories to what consumers actually experience. As we are seeing, the first reaction appears to be bipartisan sticker shock.
The Manhattan Institute analyzed premiums in many states, including Texas, showing that young men are going to pay almost double for their health insurance under Obamacare, and women will pay 55 percent to 62 percent more.
Those unfortunate enough to live in North Carolina will pay 400 percent more.
A 27-year-old man in Texas will be paying 77 percent more than his current coverage. The study factored in pre-existing conditions.
The Texas Public Policy Foundation conducted a similar study looking at the cheapest plans (for those with no pre-existing conditions) compared to new policies under Obamacare.
A 64-year-old healthy male will pay 49 percent more, a 47-year-old will pay 85 percent more, a 35-year-old will pay 138 percent more, and a 27-year-old male will pay an astonishing 158 percent more.
Indeed, my own insurance company informed me that my individual ACA premium for my family of five would be increasing by 98 percent compared to my current coverage.
One of the primary goals of Obamacare was to cover the uninsured. Yet, the non-partisan Congressional Budget Office estimates that, for all of this pain, Obamacare will cover fewer than half the uninsured. This then raises the question: Should we try a different way to solve the problem of the uninsured?
When prices increase, demand falls. But rather than making insurance cheaper and easier, it is now more expensive and heavily regulated, which will price more people out of the market.
To counter this natural market response, the IRS will levy fines — excuse me, taxes — on you for failing to purchase insurance you can’t afford. Subsidies will be unavailable for most.
Under Obamacare, even the lowest-priced “Bronze” policies are more than double the cost of what the market was offering young people before, which will make it harder to convince the young to buy insurance.
But this administration is not deterred by the laws of supply, demand, and price elasticity because they have IRS auditors who will be forcing people to buy insurance. Something makes me think these people may not be voting Democrat the next time around.
Amid the national campaigns to promote healthy lifestyles, Obamacare encourages unhealthy behaviors.
Now healthy people will subsidize the unhealthy since insurance companies are prohibited from charging unhealthy people more than the healthy. Those who eat well, exercise, and maintain their weight will pay higher premiums so that those with poor eating and exercise habits, and their chronic diseases, will pay less.
One of the more popular provisions of the ACA is the requirement that insurers cover people with pre-existing conditions. But if the IRS fines are less than the cost of insurance premiums, people will forgo insurance until they are sick. In the insurance industry, this is called “jump and dump” — jump into the market when you are sick and then dump your insurance when you are well. This is the ultimate nightmare scenario for an insurance company and further increases prices for all other consumers.
Because of Obamacare and its regulations, some states now only have one or two insurance companies providing health coverage — a competitive market reduced to a monopoly.
The New England Journal of Medicine recently published a study showing how state and federal insurance exchanges will totally control the insurance market, prohibiting non-exchange policies from being sold to individuals and small businesses, and strictly defining quality and controlling prices.
So rather than millions of individual consumers making decisions with firsthand information about their health needs, government bureaucrats with theories about your health will decide what you need and then force you to buy it.
[First Published by SA]
The human race has prospered by relying on forecasts that the seasons will follow their usual course, while knowing they will sometimes be better or worse. Are things different now?
For the fifth time now, the Intergovernmental Panel on Climate Change claims they are. The difference, the IPCC asserts, is increased human emissions of carbon dioxide: a colorless, odorless, non-toxic gas that is a byproduct of growing prosperity. It is also a product of all animal respiration and is also essential for most life on Earth, yet in total it makes up only 0.0004 of the atmosphere.
The IPCC assumes that the relatively small human contribution of this gas to the atmosphere will cause global warming, and insists that the warming will be dangerous.
Other scientists contest the IPCC assumptions, on the grounds that the climatological effect of increases in atmospheric carbon dioxide is trivial – and that the climate is so complex and insufficiently understood that the net effect of human emissions on global temperatures cannot be forecasted.
The computer models that the authors of the IPCC reports rely on are complicated representations of the assumption that human carbon dioxide emissions are now the primary factor driving climate change and will substantially overheat the Earth. The models include many assumptions that mainstream scientists question.
The modelers have correctly stated that they produce scenarios, not forecasts. Scenarios are stories constructed from a collection of assumptions. Well-constructed scenarios can be very convincing, in the same way that a well-crafted fictional book or film can be.
The IPCC and its supporters promote these scary scenarios as if they were forecasts. However, scenarios are neither forecasts nor the product of a validated forecasting method.
The IPCC modelers were apparently unaware of decades of forecasting research. Our audit of the procedures used to create their apocalyptic scenarios found that they violated 72 of 89 relevant scientific forecasting principles. Would you go ahead with your flight, if you overheard two of the ground crew discussing how the pilot had skipped 80 percent of the pre-flight safety checklist?
Thirty-nine forecasting experts from many disciplines from around the world developed the forecasting principles from published experimental research. A further 123 forecasting experts reviewed the work. The principles were published in 2001. They are freely available on the Internet, to help forecasters produce the best forecasts they can, and help forecast users determine the validity of forecasts. These principles are the only published set of evidence-based standards for forecasting.
Global warming alarmists nevertheless claim that the “nearly all” climate scientists believe dangerous global warming will occur. This is a strange claim, in view of the fact more than 30,000 American scientists signed the Oregon Petition, stating that there is no basis for dangerous manmade global warming forecasts, and “no convincing evidence” that carbon dioxide is dangerously warming the planet or disrupting its climate.
Most importantly, computer models and scenarios are not evidence – and validation does not consist of adding up votes. Such an approach can only be detrimental to the advancement of scientific knowledge. Validation requires comparing predictions to actual observations, and the IPCC models have failed in that regard.
Given the expensive policies proposed and implemented in the name of preventing dangerous manmade global warming, we are astonished that there is only one published peer-reviewed paper that claims to provide scientific forecasts of long-range global mean temperatures. The paper is our own 2009 article in the International Journal of Forecasting.
Our paper examined the state of knowledge and available empirical (that is, actually measured) data, in order to select appropriate evidence-based procedures for long-range forecasting of global mean temperatures. Given the complexity and uncertainty of the situation, we concluded that the “no-trend” model is the proper method to use. The conclusion is based on a substantial body of research that found complex models do not work well in complex and uncertain situations.
This finding might be puzzling to people who are unfamiliar with the research on forecasting. So we tested the no-trend model, using the same data that the IPCC uses, since forecasting principles require that models be validated by comparing them to actual observations.
To do this, we produced annual forecasts from one to 100 years ahead, starting from 1851 and stepping forward year-by-year until 1975, the year before the current warming alarm was raised. (This is also the year when Newsweek and other magazines reported that scientists were “almost unanimous” that Earth faced a new period of global cooling.) We conducted the same analysis for the IPCC scenario of temperatures increasing at a rate of 0.03 degrees Celsius (0.05 degrees Fahrenheit) per year in response to increasing human carbon dioxide emissions.
This procedure yielded 7,550 forecasts for each method. The findings?
Overall, the no-trend forecast error was one-seventh the error of the IPCC scenario’s projection. They were as accurate as or more accurate than the IPCC temperatures for allforecast horizons. Most important, the relative accuracy of the no-trend forecasts increased for longer horizons. For example, the no-trend forecast error was one-twelfth that of the IPCC temperature scenarios for forecasts 91 to 100 years ahead.
Our research in progress scrutinizes more forecasting methods, uses more and better data, and extends our validation tests. The findings strengthen the conclusion that there are no scientificforecasts that predict dangerous global warming.
Is it surprising that the government would support an alarm lacking scientific support? Not really. In our study of situations that are analogous to the current alarm over scenarios of global warming, we identified 26 earlier movements based on scenarios of manmade disaster, including the global cooling alarm in the 1960s to 1970s. None of them were based on scientific forecasts. And yet, governments imposed costly policies in response to 23 of them. In no case did the forecast of major harm come true.
There is no support from scientific forecasting for an upward trend in temperatures, or a downward trend. Without support from scientific forecasts, the global warming alarm is baseless and should be ignored.
Government programs, subsidies, taxes and regulations proposed as responses to the global warming alarm result in misallocations of valuable resources. They lead to inflated energy prices, declining international competitiveness, disappearing industries and jobs, and threats to health and welfare.
Humanity can do better with the old, simple, tried-and-true no-trend climate forecasting model. This traditional method is also consistent with scientific forecasting principles.
_____________Dr. Kesten C. Green is with the University of South Australia in Adelaide and is director of the major website on forecasting methods, www.ForecastingPrinciples.com, and has published twelve peer-reviewed articles on forecasting. Professor J. Scott Armstrong teaches at the University of Pennsylvania in Philadelphia and is a founder of the two major journals on forecasting methods, editor of the Principles of Forecasting handbook, and the world’s most highly cited author on forecasting methods. Dr. Willie Soon of Salem, MA for the past 20 years has published extensively on solar and other factors that cause climate changes.Copies of the authors’ climate forecasting papers are available atwww.PublicPolicyForecasting.com.
As part of the media tour for Climate Change Reconsidered II: Physical Science, two scientists from the Nongovernmental International Panel on Climate Change (NIPCC), stopped by the studios of U-T TV in San Diego.
On Thursday, Dr. S. Fred Singer, Dr. Robert Carter, and Heartland Institute President Joe Bast were guests on The Roger Hedgecock Show. They discussed the findings of the new 1,000-page report — including the state of the ice caps, sea level rise, and being called “deniers” by the media, and left-wing activists. (SPOILER: Dr. Singer doesn’t lose any sleep over it.)
Steve Staneck interviews Ben Van Metre, Senior Budget, Tax and Policy Analyst at the Illinois Policy Institute, regarding Illinois’ movement from Flat tax to Progressive income tax. This movement is in opposition to more successful financial states who have adopted the Flat tax. States with Flat taxes have higher growth rates of employment and GDP, than those states who have Progressive income tax. Ben Van Metre explains how the volatile Progressive tax is detrimental to states due to its dependence on the shifting economy.
Ronald Reagan made a lot of history as President, but when he stood before the Brandenburg Gate not far from the Berlin Wall that divided the city and said, “Mr. Gorbachev, tear down this wall”, he rocked the foundations of the Soviet empire on June 12, 1987. By 1989, the wall was opened and, in 1991, the Soviet Union collapsed.
Now thousands of Americans are saying “Mr. Obama, tear down these barricades,” They have become a symbol of the dictatorial style that has emerged over the first term of the President and now demonstrate it for everyone to see in the first year of his second term.
What is also on display are the cracks in the foundation of Obama’s presidency and administration. The first occurred in the 2010 midterm elections that returned power to the Republican Party in the House of Representatives. In the Senate these days, even the Democrats are beginning to break ranks with the White House, resisting on many fronts, “crossing the aisle” rather than vote the party line and risk reelection.
Obama has left them little choice with his oft-repeated threat that he will not negotiate with Republicans, choosing instead to use his office to garner airtime and press coverage to disparage them as terrorists, anarchists, hostage-takers, and kidnappers, to name just of few examples of his petulant, idiotic name-calling.
The job of a President is to negotiate. Every one of his predecessors in the office negotiated fulltime, seven days a week, either with his own party with the opposing one.
Obama and those who created the image of Obama have gone blind and deaf. They’ve been inside the White House bubble so long that forgot how ordinary people react when the President orders that national monuments and parks are shut down and barricades get between veterans and visitors.
When the administration opened up the National Mall to a rally by illegal aliens, the contempt for all the rest of us—natural born and naturalized citizens—could not have been more clear. The selective malevolence of the access that was denied makes a lasting impression, even on the “low information” voters.
The President’s approval rating dropped to 37% on October 9th. Congress scores in the single digits. There is a lot of unhappiness among the voters and all the campaign-style speeches and photo-ops are not going to turn this around.
Watching the media trim and adjust its sails is interesting as well. When Kathleen Sebelius, the Secretary of Health and Human Services ran into a buzz saw on Jon Stewart’s “Daily Show”, it sent a signal to other liberal media personalities that it was okay to finally question what the administration was doing, particularly as regards Obamacare. The liberal lemmings may not want to jump off the cliff with the White House.
There’s one thing that has gone largely unnoticed during the “shutdown.” It takes weeks and months for the federal government to order anything. It is a huge bureaucracy. So why were all those printed signs available for the “shutdown” unless the government keeps such things in a big warehouse somewhere?
The answer could be that Obama and his political advisors have been planning the shutdown and, in particular, the plan for the President to beat up the Republicans. He has begun now to gear up the Democrat Party campaign for the November 2014 midterm elections. We are witnessing a deliberate effort to berate non-stop the Republican Party in general and the Tea Party movement in particular. The press conference in which the President held forth for over an hour is an example, but significantly, his approval rates dropped to a new low of 37%.
Harry Truman did this in 1948 when he ran for election after filling out the term of Franklin Roosevelt who had died soon after his fourth reelection. Truman disparaged a “do nothing” Congress, controlled by the Republican Party, even though its actual record showed that it had passed a number of laws he favored. It was pure demagoguery and, combined with a tireless campaign of whistle-stop speeches, secured Truman election when everyone assumed Thomas Dewey would be the winner.
It could be that Obama has taken a lesson from that election, but he is not running to be reelected. He is running to gain full control over Congress of the kind that allowed him to ram through the Affordable Care Act—Obamacare—in 2009. There were huge protests then and there will be more now.
A rally of truckers will seek to close down the capital this weekend in protest of Obamacare and other administration policies. Another rally will follow soon after by veterans. Indeed, I suspect 2014 is going to be remembered for a score of rallies that reflect the anger that has finally boiled up into action. As more and more Americans discover that their healthcare insurance premiums have doubled and tripled, they are going to blame one man—Barack Hussein Obama.
Obama has completely misread the character of the American people, perhaps because he lacks any character of his own.[Article originally published on factsnotfantasy.blogspot.com] [Picture originally published on www.mirror.co.uk]
Think immoveable force meets immovable object.
The core conundrum of stateless Bitcoin and other virtual currencies is how to somehow gain legal acceptance by sovereign states.
The central idea behind virtual currencies is the efficiency of disregarding sovereign borders. In stark contrast, the central idea behind what makes a currency “real” is the legal regard for sovereign borders.
Real currencies are legal tender, with the emphasis on “legal.”
Specifically, the U.S. Department of Treasury’s Financial Crimes enforcement Network, (FinCEN) issued guidance earlier this year that “…virtual currency does not have legal tender status in any jurisdiction.”
Currency is neither an app nor an algorithm.
Not being legal tender, “virtual currency” cannot be used to legally settle debts or enforce contracts. It cannot be used to transact legal international trade. It cannot be used to legally transact or invest in public capital markets.
There is nothing inherently wrong with new innovative algorithmic payment mechanisms, provided that they are legally accountable to the rule of law and comply with all applicable sovereign laws and financial regulations to prevent crime, money laundering, tax evasion, fraud, etc.
That precisely appears to be the conundrum of virtual currencies like Bitcoin.
How can a virtual currency become legal tender if it is not subject to the law enforcement authority and financial backing of an internationally-recognized sovereign state?
And how could a virtual currency retain its essential appeal of borderless efficiency and stateless unaccountability, if a sovereign state took sovereign (legal) responsibility for it?
Simply, if a virtual currency collapses into the digital ether, or if someone believes they were legally wronged via the virtual currency, where does someone go for legal recourse if fraud or crime was involved?
At bottom, no matter how benignly they are represented, packaged or marketed, virtual currencies effectively are at war with the fundamental sovereign state interests of law enforcement, legal tender, contracts, commerce, trade, and consumer protection.
Another conundrum for Bitcoin proponents is their cart-before-the-horse problem, of trying to manufacture political legitimacy without underlying legality.
In requesting a ruling from the Federal Election Commission (FEC) that candidates should be able to legally accept political contributions denominated in Bitcoins, virtual currency proponents are seeking to politically end-run financial regulators.
They imagine Bitcoins can be made legal by the political acclamation of a few.
The FEC is unlikely to fall for this forum-shopping ploy and unilaterally confer “political tender” status on Bitcoin, especially when Bitcoin easily could be used to undermine the accountability purpose of the FEC.
Moreover, if Bitcoins are not legal tender, how can there be any legal or accurate valuation of any political contribution for the FEC to monitor to ensure compliance with election laws?
Furthermore, the FEC is well aware of virtual currencies propensity for being used anonymously for illegal purposes. Why would the FEC willingly introduce a well-known vehicle for corruption into the electoral process in direct contravention of U.S. financial regulators?
Yet another conundrum for Bitcoin proponents is how to create the appearance of financial legitimacy for Bitcoin with the public — without running afoul of financial anti-fraud laws.
Currently, there are at two high-profile financial efforts to try and represent Bitcoin and virtual currencies as a legitimate “investments” and to advance their acceptance generally with the investing public.
The Winkelvoss twins, of Facebook fame, have bought up a large amount of Bitcoins and have asked the SEC to approve a “Bitcoin Trust,” an Exchange-Traded-Fund to allow the public to speculate in the price fluctuations of Bitcoin as an asset.
In effect, the Winklevoss twins are hoping the SEC somehow will officially legitimize Bitcoins as an asset class by creating a de facto government-approved financial vehicle that could effectively set the “public” price for Bitcoins at any given time.
This brazen derivative scheme imagines the Bitcoin Trust as a de facto unregulated market maker and quasi investment banker for Bitcoin “investment.” This appears to be a fool’s errand because the SEC and the CFTC are no fools.
Using a different financial vehicle, SecondMarket, the exchange for trading shares of private companies, is trying to legitimize Bitcoin as an “accessible asset class.”
Targeting “wealthy investors,” they are setting up a “Bitcoin Investment Trust” to “let these investors bet on the price of Bitcoins.” This different derivative scheme effectively could create a publicly-trackable, private market price for Bitcoins.
The obvious play here is to use a private market vehicle and the consequent media attention to stoke private demand for Bitcoin with the ultimate plan of selling out to unsophisticated public investors at much higher prices.
The opportunity for fraud and manipulation with these derivative schemes is staggering because both schemes depend entirely on the Greater Fool Theory.
That means the price of Bitcoins is not driven by intrinsic values or fundamental reality, but purely on the expectation that later Bitcoin bidders will pay an even higher price in hopes of reaping the big gains of those that came before them. Sadly, this is classic bubble sucker-nomics.
One would be hard pressed to imagine a more obvious Greater Fool dynamic.
First, the core idea is untrue. Bitcoins are represented to be a “currency” (implying inherent established and legitimate value), when Bitcoins officially are not a real currency, i.e. legal tender.
Second, virtual currency has no intrinsic value — none. They are programmed ones and zeroes backed by nothing. They are not real commodities like gold, silver, oil, grain, etc. that truly have intrinsic real value as a necessary or valuable input to something else of real value.
Third, they enjoy no legal value. Unlike real currencies that are legally backed by a sovereign nation and their citizenry, no one financially backs Bitcoin.
If something goes wrong, poof, there could be nothing there and no place for anyone to seek recourse for any illegal behavior that caused it. No one even knows the person who originally programmed the Bitcoin algorithm or if it is meant to be stable long term.
Finally, this is a classic Ponzi-scheme dynamic where early investors know they can reap extraordinary speculative profits and exit without a trace because they know it will be the Greater Fools, who paid top dollar, who will lose big or everything when the artificial hyped momentum peaks and then predictably craters.
The early speculators knew that the finite, very small world supply of Bitcoins, 21 million, combined with little initial demand, would mean prices would skyrocket when broad public demand could be created via hyping Internet virtual currencies as the next big thing.
These schemes are easier than taking candy from a baby, and many Bitcoin proponents know it.
In sum, the fatal flaw of Bitcoin and virtual currencies is that they are not legal tender, despite the furious, determined and deceptive efforts of many to misdirect people from this damning tent-pole fact.
The old adage is true here: “you can’t make a silk purse out of a sow’s ear.” Promising that one can for financial gain is tantamount to fraud.
The task of law enforcement here is to hold accountable those who publicly represent what is not legal and demonstrably prone to fostering illegal activities, as trustworthy or a legitimate investment.
Time will tell if financial law enforcement has learned from the derivative deceptions that helped precipitate the Financial Crisis.
Heartland Institute’s Ben Domenech was interviewed by Washington Post’s Nia-Malika Henderson, to discuss the government shut down. As the government gets closer to approaching the debt ceiling, Domenech addresses the Republican and Democratic Parties’ unwillingness to accept each other’s terms to begin negotiations.
With the words “government shutdown” on every news commentator’s lips these days, it’s time for a little – in Thomas Paine’s famous phrase – common sense.
First, let’s put things in perspective: The government “shuts down” every weekend and nothing bad happens. That’s right: the courts are closed, most EPA and other administrative agency personnel go home, the Washington Navy Yard closes up shop, immigration offices aren’t open, and almost every Sunday morning the President plays a little golf. Nobody suffers much and the nation is no worse off: civilian airliners keep flying; the U. S. Armed Forces remain on patrol throughout the globe; the Interstate Highway System remains open; and everybody’s Social Security check still goes out on time even though the so-called “trust fund” doesn’t really exist.
Even in the wake of the current so-called “shutdown” all these things and more remain true: Government-subsidized colleges and universities (and that means most of them, through tuition and research grants) continue to hold classes; the Public Broadcasting System remains on the air; and even the First Lady’s Twitter account reportedly remains active.
Yes, a lot of government employees are technically on “furlough” right now, but at most they’ve missed one pay date and if the past is any guide they will all get paid in arrears for what amounts to an unscheduled – if unwelcome – vacation at the taxpayers’ expense. Meanwhile, for those employed in the private sector, federal income taxes, Social Security, and Medicare payments will continue to be withheld from their paychecks and remitted to the government regardless of how long the so-called “shutdown” lasts.
So why the entire hullabaloo? In a word, politics. Both major parties in the sausage-making business of legislating hope to achieve their legislative aims and/or score political points by engaging in brinksmanship and both hope the people will blame the other party.
Republicans in the House of Representatives (“the people’s house”) view Obamacare (the so-called “Affordable Care Act”) as politically unpopular, economically unwise, and not yet ready for prime time; they therefore seek to defund or to delay its implementation as part of government funding discussions in which they play a vital and necessary Constitutional role.
The President and the Senate – who have delayed or waived or exempted every major provision of Obamacare except for the so-called “individual mandate” – nonetheless see the Act as the one signature achievement of this administration. They therefore refuse to agree to anything that will loosen their toehold on the century-old progressive dream of establishing a socialized national health care system that actually originated with Otto von Bismarck. Rather than agree even to delay for a year the one major portion of the Act that has not already been suspended, delayed, or waived, the President refuses to sign and the Senate refuses to pass a bill to “keep the government running” while blaming their intransigence on “extreme” “right wing” “hostage-taking” “tea party” (choose your favorite adjective or epithet) Republicans in the House.
Yet even the Senate’s proposed funding solution – a so-called “continuing resolution” – is merely the political equivalent of calling up your credit card company and asking for your 100th credit limit increase because you refuse to live within your means. It’s been years since the government has even adopted a budget, the nation continues to run unsustainable annual deficits, and the taxpayers are saddled with a virtually unpayable 16.7 trillion dollar national debt. Meanwhile, the authorized debt ceiling rapidly approaches and will be reached around mid-October.
So what to do? Herewith a modest proposal: continue the so-called “shutdown” as a matter of fiduciary responsibility to the taxpayers and vote to fund, program by program and department by department, only those functions that are both (a) set forth as enumerated powers of the national government in Article I, Section 8, of the Constitution and (b) absolutely necessary for a national government – as opposed to private parties or state and local governments – to accomplish.
Maintain an army and a navy? Yes; the Constitution empowers Congress to do so and it would be unwise policy to contract national defense out to the private sector (even though private companies actually build the nation’s planes, tanks, and ships). Subsidize the National Endowment for the Arts? No; the arts are important – perhaps essential – to a civilized society, but private patrons, benefactors, and fans of museums and the performing arts are perfectly capable of supporting those they prefer. Administer a patent system and a court system? Yes. Impose a national health care plan? No. Coin money? Yes. Dictate what size or kind of toilets, showerheads, and light bulbs a free people must buy? No. You get the idea.
Consider it a Constitutional Convention on the installment plan but think of it as “zero-based budgeting”: when you’re seriously over your head in debt and your credit cards are maxed out, instead of looking just to how much you spent last year and deciding how much more (or even less) you want to spend next year, first consider what you really need and then pay for only the essentials until you’re out of debt and your budget is under control. Once that happens, resolve never to do it again.
The nation is in financial crisis and resolving it should be about more than just scoring political points or about whether the nation really needs, wants, or can afford Obamacare. To paraphrase former White House Chief of Staff Rahm Emanuel, it would be a shame to let a serious crisis go to waste.
Here’s what the president said yesterday, courtesy of CNN:
“On Tuesday, Obama sternly warned that ‘every American could see their 401(k)s and home values fall’ and the country would see a ‘very significant risk’ of a deep recession. The only responsible action, he repeated: raise the debt ceiling, without preconditions.
“’We’re not going to pay ransom for’ America paying its bills, he told reporters, placing the blame squarely on House Republicans. ‘Let’s lift these threats from our families and our businesses and let’s get down to work.’
Compare that to this signed statement opposing raising the debt ceiling by then-Senator Obama, which he had entered in the Congressional Record. Kudos to the ZeroHedge.comWeb site for finding and originally posting this image.
New data from the American Community Survey makes it possible to review the trend in mode of access to employment in the United States over the past five years. This year, 2012, represents the fifth annual installment of complete American Community Survey data. This is also a significant period, because the 2007 was a year before the Lehman Brothers collapse that triggered the Great Financial crisis, while gasoline prices increased about a third between 2007 and 2012.
The work trip access data is shown in Tables 1 and 2. Driving alone continued to dominate commuting, as it has since data was first reported in the 1960 census. In 2007, 76.1 percent of employment access was by driving alone, a figure that rose to 76.3 percent in 2012. Between 2007 and 2012, driving alone accounted for 94 percent of the employment access increase, capturing 1.55 million out of the additional 1.60 million daily one-way trips (Figure 1). The other 50,000 new transit commutes were the final result of increases in working at home, transit and bicycles, minus losses in car pooling and other modes.
Carpools continued to their long decline, losing share in 43 of the 52 major metropolitan areas. Approximately 810,000 fewer people travel to work by carpools in 2012, which reduced its share from 10.7 percent to 9.7 percent.
Transit did better, rising from 4.9 percent of work access in 2007 to 5.0 percent in 2012. There was an overall increase of approximately 250,000 transit riders. This increase, however, may be less than might have anticipated in view of the much higher gasoline prices and the imperative for commuters to save money in a more difficult economy.
Bicycling also did well, rising from a 0.5 percent share in 2007 to a 0.6 percent share in 2012. Approximately 200,000 more people commuted by bicycle by 2012.
Walking retained its 2.8 percent share, with only a modest 15,000 increase over the period. The largest increase in employment access outside single occupant driving was working at home, which rose from 4.1 percent to 4.4 percent. This translated into an increase of approximately 470,000.
Metropolitan Area Highlights
Among the 52 metropolitan areas with more than 1 million population (major metropolitan areas), 47 had drive alone market shares of 70 percent or more. Birmingham was the highest, at 85.6 percent. Surprisingly, this grouping included metropolitan areas with reputations for strong transit ridership, such as Chicago, Philadelphia, and Portland. Four metropolitan areas had drive alone shares of between 60 percent and 70 percent: Seattle, Washington, Boston, and San Francisco, which had the second lowest in the nation at 60.8 percent. As would be expected, New York had by far the lowest drive alone market share at 50.0 percent.
Consistent with its low drive alone market share, New York led by a large margin the other metropolitan areas in its transit work trip market share. Transit carried 31.1 percent of New York commuters, up nearly a full percentage point from the 30.2 percent in 2007. New York alone accounted for nearly one-half of the growth in transit commuting over the period.
San Francisco continued to hold onto second place, with a 15.1 percent transit market share, up a full percentage point from 2007. Washington rose to 14.0 percent, up from 13.2 percent in 2007. Boston (11.9 percent) and Chicago (11.0 percent) were the only other major metropolitan areas to achieve a transit work trip market share of more than 10 percent, and were little changed from 2007.
Working at home continued to increase at a larger percentage rate than any other mode of work access. Four metropolitan areas were tied for the top position in 2012, at 6.4 percent. These included Raleigh, Austin, San Diego, and Portland, all metropolitan areas with a strong high-tech orientation. In San Diego and Portland, where large light rail systems have been developed, working at home is now more popular as a mode of access to work than transit.
According to 2012 US Census Bureau estimates, the major metropolitan areas comprised 55.2 percent of the national population. These metropolitan areas represented a slightly larger share of total employment, at 57.3 percent. The combined major metropolitan areas also had similar shares to their national population share in each of the employment access modes, ranging from a low of 55.3 percent of communters driving alone to 59.9 percent of walkers. The one exception was transit, where the major metropolitan areas constituted nearly all of commuters, at 90.7 percent, well above their 55.2 percent share of US population (Table 1).
Table 1 Distribution of Employment Access (Commuting) by Employment Location: 2012 SHARE OF WORK ACCESS BY MODE (2012) All Employment Drive Alone Car Pool Transit Bike Walk Other Work at Home MAJOR METROPOLITAN AREAS 57.3% 55.3% 55.4% 90.7% 59.9% 56.0% 55.6% 59.3% Metropolitan Areas with Legacy Cities 17.1% 13.8% 14.4% 65.4% 21.5% 27.8% 18.3% 17.1% 6 Legacy Cities (see below) 6.0% 2.7% 4.1% 55.1% 12.7% 16.3% 7.8% 4.6% Suburban 11.1% 11.1% 10.3% 10.3% 8.8% 11.5% 10.5% 12.6% New York Metropolitan Area 6.4% 4.2% 4.5% 39.6% 5.8% 13.6% 8.5% 5.9% Legacy City: New York 3.1% 1.0% 1.5% 35.4% 4.2% 9.5% 4.2% 2.5% Suburban 3.3% 3.2% 3.0% 4.2% 1.7% 4.1% 4.3% 3.5% 5 Other Metropolitan Areas with Legacy Cities 10.7% 9.6% 9.9% 25.8% 15.7% 14.2% 9.8% 11.2% 5 Legacy Cities (CHI, PHI, SF, BOS, WDC) 2.9% 1.7% 2.6% 19.7% 8.5% 6.8% 3.6% 2.1% Suburban 7.8% 7.9% 7.3% 6.1% 7.1% 7.5% 6.2% 9.1% 46 Other Major Metropolitan Areas 40.2% 41.5% 41.0% 25.3% 38.4% 28.2% 37.3% 42.2% OUTSIDE MAJOR METROPOLITAN AREAS 42.7% 44.7% 44.6% 9.3% 40.1% 44.0% 44.4% 40.7% United States 100% 100% 100% 100% 100% 100% 100% 100% Calculated from American Community Survey: 2012 (one year)
Commuting Becomes More Concentrated in Legacy Cities
This concentration of transit commuting was most evident to the six large “transit legacy cities,” (the core cities of New York, Chicago, Philadelphia, San Francisco, Boston, and Washington), which still exhibit sufficient remnants of their pre-automobile urban cores that support extraordinarily high transit market shares. The transit legacy cities accounted for 55 percent of all transit commuting destinations in the United States, yet have only six percent of the nation’s jobs. Between 2007 and 2012, the concentration increased, with transit legacy cities accounting 68 percent of the additional transit commutes were between 2007 and 2012. Outside the legacy cities, there was relatively little difference in the share of transit commutes within metropolitan areas with legacy cities and in the other major metropolitan areas (Figure 2)
The key to the intensive use of transit in the legacy cities is the small pockets of development that are particularly amenable to high transit market shares – the six largest downtown areas (central business districts) in the United States. Most of the commuting to transit legacy cities is to these downtown areas, Yet, the geographical areas of these downtowns is very small. Combined, the six downtown areas are only one-half larger than the land area of Chicago’s O’Hare International Airport. This yields employment per square mile densities of from 40 to 150 times densities of employee residences throughout their respective urban areas.
Not surprisingly, transit has very strong market shares to work locations in the transit legacy cities, at 45.8 percent. At the same time, transit commuting to locations outside the transit legacy cities is generally well below the national average. The exception is New York, where transit commuting to suburban locations is 6.4 percent, above the overall national average of 5.0 percent. In the five other metropolitan areas with transit legacy cities, transit commuting to suburban locations is 3.9 percent. This drops to 3.1 percent, overall, in the 46 other major metropolitan areas and 1.1 percent in the rest of the nation (Table 2 and Figure).
Table 2 Employment Access (Commuting) by Employment Location: 2012 Drive Alone Car Pool Transit Bike Walk Other Work at Home MAJOR METROPOLITAN AREAS 73.6% 9.4% 7.9% 0.6% 2.8% 1.2% 4.5% Metropolitan Areas with Legacy Cities 61.7% 8.2% 19.2% 0.8% 4.6% 1.3% 4.4% 6 Legacy Cities (see below) 33.9% 6.5% 45.8% 1.3% 7.6% 1.6% 3.3% Suburban 76.8% 9.1% 4.7% 0.5% 2.9% 1.1% 5.0% New York Metropolitan Area 50.0% 6.8% 31.1% 0.6% 6.0% 1.6% 4.1% Legacy City: New York 23.7% 4.6% 57.1% 0.8% 8.6% 1.6% 3.5% Suburban 74.8% 8.9% 6.4% 0.3% 3.5% 1.6% 4.6% 5 Other Metropolitan Areas with Legacy Cities 68.6% 9.0% 12.1% 0.9% 3.7% 1.1% 4.6% 5 Legacy Cities (CHI, PHI, SF, BOS, WDC) 44.8% 8.6% 33.7% 1.8% 6.5% 1.5% 3.1% Suburban 77.6% 9.1% 3.9% 0.6% 2.7% 1.0% 5.1% 46 Other Major Metropolitan Areas 78.7% 9.9% 3.1% 0.6% 2.0% 1.1% 4.6% OUTSIDE MAJOR METROPOLITAN AREAS 79.9% 10.1% 1.1% 0.6% 2.9% 1.3% 4.2% United States 76.3% 9.7% 5.0% 0.6% 2.8% 1.2% 4.4% Transit legacy cities include the municipalities of New York, Chicago, Philadelphia, San Francisco, Boston & Washington
Staying the Same
The big news in the last five years of commuting data is that virtually nothing has changed. This is remarkable, given the greatest economic reversal in 75 years and continuing gasoline price increases that might have been expected to discourage driving alone. Yet, driving alone continues to increase, while the most cost effective mode of car pooling continued to suffer huge losses, while working at home continued to increase strongly.
Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris and the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life.
Photograph: DART light rail train in downtown Dallas (by author)
[First Published by Newgeography]
Being intrigued and interested in the announced topic, Why do we have such a big immigration mess?, I immediately registered to attend Heartland’s speaker series featuring Henryk A. Kowalczyk in a talk about immigration on Wednesday, October 2nd.
Henryk A. Kowalczyk referred to the Heartland anniversary benefit dinner of 2008, at which time guests participated in a heated debate about immigration. A vote was taken and was split almost evenly between supporters and opponents of illegal immigrants and immigration. Now five years later, the issue is still front and center. About Mr. Kowalczyk, he was born in Poland but now lives in Chicago as a naturalized citizen.
Introduced by Joe Bast, president of the Heartland Institute, Mr. Kowalczyk explained how as an engineer and a business man he looked for solutions to problems, but to do so it was essential to understand the problem first.
Within minutes into Kowalczyk’s talk, I could perceive that his views were not of my own nor of my liking, which was likewise the tenor of a few of the comments made by others at the conclusion of the event. At first I thought Mr. Kowalczyk was approaching the issue of immigration as a libertarian, but I quickly dismissed this viewpoint. Libertarians argue from the first principle of human rights, believe they are inherent regardless of what country someone lives in. Therefore, to a libertarian, the right to emigrate or immigrate is a basic human right. Henryk definitely did not embrace this concept. He believes we should put a price tag on immigrating to the U.S., which is really a conservative position even if he favors more people entering the country. Might this make Mr. Kowalczyk a pro-immigration conservative? Read on to decide for yourself.
Freedom of speech is so important to uphold. Kudos to The Heartland Institute, as a leading free market think tank, for inviting Kowalczyk to speak, knowing that his remarks would be scrutinized and questioned! Mr. Kowalczyk was warned beforehand of the reception he would most likely receive in front of Heartland members and friends, but this didn’t deter him from accepting Heartland’s invitation.
According to Henryk Kowalczyk our thinking about immigration is based upon and tainted by 1) xenophobia, 2) on having Socialistic tendencies, and 3) on the failure to practice deliberation democracy.
Capitalism, as defined by Kowalczyk, was where everyone had the same freedom to pursue their particular interest, while with Socialism there was a need for a society to collectively work to come up with better ideas for the good of a society.
What I found most disturbing and so out-of-step with my own thinking was when Kowalczyk described those of us who weren’t in support of open immigration as having tendencies that were akin to socialism. Kowalczyk reminded all that the democratic process had at time backfired, as many Americans continue to hold on to the belief that democracy mandates that all men should have an equal vote in deciding important issues
What followed was a discussion by Kowalczyk of mistakes made a hundred years ago in the treatment of new arrivals. Never corrected, they now weigh heavily on today’s immigration problems.
Before 1924 new arrivals were mostly unfettered Europeans, only white, in search of new opportunities and freedom of movement in looking for jobs. The scouts came first, bringing their families over later. Many of the new immigrants settled west of the Mississippi where limited friction did develop between the new arrivals and those who had already undergone urbanization.
The 1850′s saw the rise of anti-Irish sentiment. Anti-German sentiment followed. The Chinese Exclusion Act of 1882 was aimed at controlling the influx of Chinese immigrants who had arrived to work on railroads.
The arrival of the 20th century brought with it a large influx of individuals with pronounced cultural differences. With this trend followed a dramatic change in the nature of society. An intense dislike for each new ethnic group setting foot in America became common place. Especially evident was the rise of anti-Semitism which developed side-by-side with the widely held belief of eugenics, which deduced that Jews were inferior and had a negative effect on society. It made no difference that Jewish enrollment in colleges in the East totaled 20 percent of all new admissions. With the rise Hitler and the use of eugenics by his administration to create a superior race of people, the movement lost all of its steam in the U.S. and was quickly abandoned by the elites.
Critical in creating the immigration mess of today, according to Henryk Kowalczyk, was the Gentleman’s Agreement of 1907, and the formation in the same year of the Dillingham Commission (1907-1911) in response to the growing political concerns about immigration in the U.S.
The Dillingham Commission decided that immigration from southern and Eastern Europe posed a serious threat to American society. This determination prompted The Emergency Quota Act of 1921 which instead favored immigration from northern and western Europe. Eight years later, in 1929, the National Origins Act set the annual immigration ceiling annually at 150,000 which allocated northern and western Europeans 85% of all the places. Asian immigration was barred altogether.
How the mindset of the American people and the actions of politicians were influenced by xenophobia, socialism, and deliberation during the first decades of the 20th century in regard to immigration policy, Mr. Kowalczvk tied all together in the following ways. Concerning xenophobia, The laws enacted, as described in the two previous paragraphs, set forth immigration quotas and further classified people from one area more desirable to fill the existing quotas slots than from others areas of the world.
Regarding socialism, pointed out by Kowalczyk was that this ideology had achieved recognition while gaining a foothold in this nation during the first decade of so the 20th century, bringing with it the idea that the U.S. was superior to other countries. Accordingly, this nation had the right to decide those who could enter the country. An example given of socialistic behavior at the time was alcohol prohibition from 1920-1933 under the guise that a central government by its actions could shape society.
As far as the inability of the American people to practice deliberate democracy, Kowalczyk asked what the consequences were of limiting new arrivals in relation to the Law of 1924 (The Johnson-Reed Act)?
They were enumerated as such:
- With the limiting of new arrivals, some believed this was a factor in the Great Depression,
- It was the first time politicians had added a price tag to be in the U.S.
- An environment was created for the black market.
- The negative aspects didn’t show up immediately because of WW II and the prosperity it generated.
Going forward in years to 1952, although the immigration part remained essentially the same with the upholding of the national origins quota system, the Naturalization Act of 1952 removed the stigma against Asians from being able to become naturalized American citizens. Also introduced was a system of preferences based on skill and family reunification, vetoed by the Truman White House, Congress overrode the veto.
The Immigration and Nationality Act of 1965, was signed by President Lyndon Johnson. This act opened up chain-family-sponsored immigration. It also leveled the immigration playing field by giving a nearly equal shot to newcomers from every corner of the world. By so doing it also changed the face of America with immigration now being viewed as a gift that wealthy nations of the world should offer to the very poor. No longer was immigration seen as part of our economy.
The Immigration Act of 1990 went even further and signaled a return to the pre-1920′s open-door immigration policy. It likewise created the lottery program which Kowalczyk considers the greatest and most stupid blunder ever made in dealing with the immigration mess by establishing a whole new class of immigrants known as “diversity immigrants.”
The 2006 Kennedy-McCain Comprehensive immigration Reform Act of 2006 went nowhere.
Jumping ahead to 2013, the so-called partisan Gang-of-Eight Senate bill is presently stalled and under fire over the issue of whether the border should be secured first before amnesty is granted with only the promise of border security. In Kowalczyk’s estimation, the 2013 Senate proposal is based on upside down logic because it fails to meet our nation’s economic needs by bringing in as many foreign workers needed.
Regarding President Obama’s DREAM Act Executive Order, Kowalczyk was in favor of it because it offered much needed development relief and education opportunities to alien minorities. According to Kowalczyk, some human treatment was finally being offered young people. Any opposition to what the Dream Act granted exhibited proof of the continued presence of xenophobia in this nation.
Reasons given by Mr. Kowalczyk as to why this nation should and can absorb more immigrants:
- Foreign born, including both illegal and legal, make up only 13% of this nation’s total population. The doubling of the percentage in the last 30 years has given rise to anti-immigrant sentiment.
- In Canada the number of foreign born is 20%. Canada has a higher GPD than does the U.S. Kowalczyk attributes this to Canada’s higher immigrant population and thus concludes that this nation would benefit by having a larger percentage of immigrants.
- Out of a population of 350 million in the U.S., illegal immigrants at 11 million account for only 3.49% of the population. Kowalczyk believes that this percentage wouldn’t go any higher even if we allowed more illegal immigrants to enter the U.S., as this is all our U.S. labor market is in need of.
Like it or not, Mr. Kowalczyk believes that we must acknowledge that more immigrants are needed. For those critics who say that illegals are taking jobs away from the American people this is not true, as many of this nation’s jobs have moved either overseas and to other countries.
For those critics who say that big business benefits mostly from illegal immigrant workers, this is not true. With more people working for a living more wealth is created.
Critics are also incorrect when they say that the source of all our nation’s problems is allowing illegal to work in this country. Regarding high skilled labor, Kowalczyk does admit that engineers brought over from other countries do work for less, but it is the fault or our nation’s colleges in failing to produce engineers and scientists in sufficient number to fill our nation’s requirements.
As far as the current immigration impasse, Mr.Kowalczyk relates it to the fact that 55% of the American people want fewer immigrants than we now have. Most legislators do objectively realize that this nation needs more immigrants, but they haven’t the guts to confront their voters and tell them they are wrong.
As far as not enforcing our laws? The law is meant to protect particular interests. It is not to be decided in accordance to moral values. A moral dilemma facing law enforcers and enforcement has become the criminalization of illegal immigrants.
By using government to restrict the flow of illegal immigrants, Kowalczyk warns that socialist behavior is being employed which didn’t work anywhere else before in the world, and it won’t work here and now.
My comment expressed openly at the Heartland event at the completion of Henryk Kowalczyk’s talk: I don’t believe anything you said! I then went on to tell Mr. Kowalczyk why.
It was only when leaving early to catch a train back home, that Kowalczyk showed a slide he had omitted during his talk because of time restrictions that offered some thoughts I could agree with – if the border were first closed – although I’m still in disagreement with Kowalczyk’s open border concept and that we need more immigrants for the sake of our economy. Furthermore, why is treating illegal immigrants as a social issue dead wrong?
Mr. Kowalczyk’s proposal of several years in the making is defined under his The Freedom of Migration Act. Although Kowalczyk admits that his concept is far away from what most Americans think about immigration and that he could be completely wrong, he further states, if most Americans were right we would not have an immigration crisis either.The solution, as outlined in Henryk Kowalczyk’s The Freedom of Migration Act:
- The only way that a foreigner could settle in the USA should be by finding employment here.
- Private employment agencies should, for a fee, manage the recruitment of foreigners, background checking, issuing ID cards, and keeping record of their employment.
- During the first 5 years of living in the USA, an alien worker should not be entitled to any social benefits available to citizens and permanent residents.
- Political refugees and other individuals admitted to the U.S. for humanitarian reasons should be assisted by private charitable organizations to register as alien workers and then follow the same path as all other foreigners settling here.
- Foreigners which are rich enough to live here without working should be allowed to do so.
- After staying in the USA for five years, a foreign worker, his or her spouse, or minor children should be entitled to obtain a status of the permanent resident, opening the venue to the citizenship.
A fire (screen capture from Jalopnik.com) that torched a Model S from the formerly Teflon Tesla Motors on Tuesday blackened its front end, lowered its stock price, and (further) revealed a corporate arrogance not seen since Fisker Karmas were alight.
But CEO Elon Musk saw to it that taxpayers were fully paid back their $465 million Department of Energy loan, so as watchdogs over the public purse we can forget all about it and just go on about our business – right?
Wrong. The incident near Seattle still should be of great concern because Tesla still heavily depends on tax breaks (like the consumer’s $7,500 federal credit) and the sale of emissions credits (mainly from California) to partially subsidize the costs of their electric cars. Moreover, the government has invested billions of dollars in the research and development of new battery technology, all in the name of energy efficiency in order to save the world from global warming. Those based on lithium have gone up in flames in planes, plants and automobiles.
One of these days there will be a fatality, but until then manufacturers dismiss the incidents. The statement Tesla issued about the fire in Kent, Wash. was matter-of-fact and lacked any expression of concern for the vehicle’s owner.
“Yesterday, a Model S collided with a large metallic object in the middle of the road, causing significant damage to the vehicle,” the company response said. “The car’s alert system signaled a problem and instructed the driver to pull over safely, which he did. No one was injured, and the sole occupant had sufficient time to exit the vehicle safely and call the authorities. Subsequently, a fire caused by the substantial damage sustained during the collision was contained to the front of the vehicle thanks to the design and construction of the vehicle and battery pack. All indications are that the fire never entered the interior cabin of the car. It was extinguished on-site by the fire department.”
It almost sounds like Tesla wants an “attaboy” for the brilliance of its safety features and battery design, rather than express how grateful that the driver was not hurt. Whether there actually was a “large” chunk of metal that was struck still isn’t clear from the evidence, but if there was, it’s not a reason for Tesla to be absolved of responsibility. After all, debris is struck in roadways regularly around the country and it doesn’t cause episodes like this. What, for instance, if the Model S had actually collided with an object in the road and it rendered the driver unconscious? Then we’d be talking about a much different result.
Back when Fisker Automotive was still alive and stumbling, their public relations department handled mishaps in a similar fashion. In May 2012 a Fort Bend County, Texas fire marshal attributed a garage blaze to the homeowner’s Fisker Karma, which he had parked shortly before he started smelling burning rubber and discovered the fire. Nevertheless Fisker issued a statement that said, “As of now, multiple insurance investigators are involved, and we have not ruled out possible fraud or malicious intent. Based on initial observations and inspections, the Karma’s lithium ion battery pack was not being charged at the time and is still intact and does not appear to have been a contributing factor in this incident.” The owner was not pleased by the challenge to his integrity.
And after a California Karma fire in August last year, the company said, “We have more than 1,000 Karmas on the road with a cumulative 2 million miles on them. There are more than 185,000 highway vehicle fires in the US every year…No injuries were reported; the vehicle was parked; and the fire was extinguished safely by the emergency services.”
The arrogance isn’t limited to the automotive realm. In April this year Boeing, after a series of “thermal runaway” incidents on its lithium-ion battery-powered Dreamliner, officials announced they gave up trying when it couldn’t find the source of the problem. Instead the manufacturer said they came up with a solution that would both contain a potential fire and vent its heat outside the airplane if another fire happened.
“In some ways it almost doesn’t matter what the root cause was,” said Michael Sinnett, Boeing’s top engineer.
Undoubtedly there are a lot of very smart people who have worked very hard on developing these new technologies. But likewise there have been equally brilliant individuals warning these engineers and entrepreneurs that they are dealing with dangerous materials and chemistry, and that just because someone hasn’t been hurt yet, doesn’t mean it can’t happen.
Lewis Larsen of Chicago-based Lattice Energy LLC has consistently called attention to the problems with lithium ion technologies and their tendencies to thermally run away – or, in other words, burn uncontrollably. The practicality problem (other than their immense cost) with the batteries is that when they experience stress – for any number of reasons – it’s almost like unleashing hell.
“…A battery cell’s electrochemical reactions can suddenly start running at greatly elevated rates that create more process heat than normal thermal dissipative mechanisms can easily handle,” Larsen wrote, “which then starts raising the temperature of battery cell contents out beyond their ideal safe operating range…(eventually) a dangerous feedback loop is created…thermal runaways are thus born….”
For many – perhaps most – people that isn’t the kind of risk you want in your “mobile platform,” as Larsen put it. But rather than emphasize those challenges, most of the media coverage has emphasized what the incident has done to Tesla’s stock price, which irrationally skyrocketed upward this year.
Part of the bombastic investor enthusiasm stemmed from other superlatives bestowed upon the Model S, such as the National Highway Traffic Safety Administration’s top score of five stars, which spurred Musk to make sure the media was told the car scored even higher on some safety aspects. And then in May Consumer Reports’ announced the Model S scored 99 out of 100 – almost perfect!
It was all too much too soon for the electric car with a minimal track record. The doubts and questions about lithium ion batteries used in vehicles and planes – and the massive taxpayer subsidization of them – are still valid.