The Biggest Problem with the Big Three can be Summed Up in Three Little Letters
Reason abound for the current sad state of the American auto industry, but the biggest is the one no one is willing to talk about: The United Auto Workers Union. According the US Department of Labor, it costs the American auto industry $73.20 per hour to employ a UAW union member. Toyota, a non-union manufacturer, shells out $48.00 per hour. And the kicker, the average American worker overall costs $28.48.
Now don’t get me wrong, I have nothing against the average UAW worker. Who can blame them for taking a very high paying job. And no, they aren’t actually taking home $73.20 per hour. That cost includes benefits, pensions and costs associated with their employment that the average employee never sees, but they are costs to the manufacturer none the less.
Beyond shear costs, there are the structural problems too. When market forces dictate to a non-union manufacturer that it needs to make a change, that manufacturer makes the change as quickly as possible to stay competitive. But when a US auto manufacturer needs to close plants, retool or introduce further automation, it is hampered by UAW contracts that make it impossible to do so quickly and cost-efficiently, putting it at further competitive disadvantage.
But it gets worse. Similar to the warehousing of lousy teachers in NYC, auto manufacturers strait-jacketed by insane contracts warehouse unnecessary employees in “rubber rooms.” In 2006, there were 15,000 able-bodied UAW employees in this “Job Bank.” Auto manufacturers are forced to pay up to $2 billion per year for workers doing absolutely NOTHING! Add to that all the perfectly healthy workers who manufacturers are forced to provide early buyouts and retirements, and it’s no wonder the industry is dying.
Now congress has put the chief architects of the Fannie and Freddie meltdown on the case. Barney Frank and Chris Dodd, who have voiced their concern about further weakening union strength, are going to dictate to the Big 3 how to fix their business.
Heaven help us, and call your congressmen.
The Average Obama Voter According to Zogby
This telephone survey of 512 Obama voters nationwide was conducted Nov. 13-15, 2008, and carries a margin of error of +/- 4.4 percentage points. It is an actual Zogby polling survey using the same scientific methods used in all their polling. 97.1% were High School Graduates or higher; 55% were College Graduates. (Poll can be found at http://www.zogby.com/news/ReadNews.cfm?ID=1642)
Results to 12 simple Multiple Choice Questions
57.4% could NOT correctly say which party controls congress (50/50 shot just by guessing)
71.8% could NOT correctly say Joe Biden quit a previous campaign because of plagiarism (25% chance by guessing)
82.6% could NOT correctly say that Barack Obama won his first election by getting opponents kicked off the ballot (25% chance by guessing)
88.4% could NOT correctly say that Obama said his policies would likely bankrupt the coal industry and make energy rates skyrocket (25% chance by guessing)
56.1% could NOT correctly say Obama started his political career at the home of two former members of the Weather Underground (25% chance by guessing)
And yet…..
Only 13.7% failed to identify Sarah Palin as the person on which their party spent $150,000 in clothes
Only 6.2% failed to identify Palin as the one with a pregnant teenage daughter
And 86.9 % thought that Palin said that she could see Russia from her “house,” even though that was Tina Fey who said that!!
Only 2.4% got at least 11 correct.
Only .5% got all of them correct. (And we “gave” one answer that was technically not Palin, but actually Tina Fey)
John Zogby has received significant criticism for the above poll. Here is his response:
“We stand by the results our survey work on behalf of John Ziegler, as we stand by all of our work. We reject the notion that this was a push poll because it very simply wasn’t. It was a legitimate effort to test the knowledge of voters who cast ballots for Barack Obama in the Nov. 4 election. Push polls are a malicious effort to sway public opinion one way or the other, while message and knowledge testing is quite another effort of public opinion research that is legitimate inquiry and has value in the public square. In this case, the respondents were given a full range of responses and were not pressured or influenced to respond in one way or another. This poll was not designed to hurt anyone, which is obvious as it was conducted after the election. The client is free to draw his own conclusions about the research, as are bloggers and other members of society. But Zogby International is a neutral party in this matter. We were hired to test public opinion on a particular subject and with no ax to grind, that’s exactly what we did. We don’t have to agree or disagree with the questions, we simply ask them and provide the client with a fair and accurate set of data reflecting public opinion.” - John Zogby
Bankruptcy, not bailout, is the right answer
The Following is a direct quote from CNN.com
By Jeffrey A. Miron, Special to CNN
Editor’s note: Jeffrey A. Miron is senior lecturer in economics at Harvard University. A Libertarian, he was one of 166 academic economists who signed a letter to congressional leaders last week opposing the government bailout plan.
CAMBRIDGE, Massachusetts (CNN) — Congress has balked at the Bush administration’s proposed $700 billion bailout of Wall Street. Under this plan, the Treasury would have bought the “troubled assets” of financial institutions in an attempt to avoid economic meltdown.
This bailout was a terrible idea. Here’s why.
The current mess would never have occurred in the absence of ill-conceived federal policies. The federal government chartered Fannie Mae in 1938 and Freddie Mac in 1970; these two mortgage lending institutions are at the center of the crisis. The government implicitly promised these institutions that it would make good on their debts, so Fannie and Freddie took on huge amounts of excessive risk.
Worse, beginning in 1977 and even more in the 1990s and the early part of this century, Congress pushed mortgage lenders and Fannie/Freddie to expand subprime lending. The industry was happy to oblige, given the implicit promise of federal backing, and subprime lending soared.
This subprime lending was more than a minor relaxation of existing credit guidelines. This lending was a wholesale abandonment of reasonable lending practices in which borrowers with poor credit characteristics got mortgages they were ill-equipped to handle.
Once housing prices declined and economic conditions worsened, defaults and delinquencies soared, leaving the industry holding large amounts of severely depreciated mortgage assets.
The fact that government bears such a huge responsibility for the current mess means any response should eliminate the conditions that created this situation in the first place, not attempt to fix bad government with more government.
The obvious alternative to a bailout is letting troubled financial institutions declare bankruptcy. Bankruptcy means that shareholders typically get wiped out and the creditors own the company.
Bankruptcy does not mean the company disappears; it is just owned by someone new (as has occurred with several airlines). Bankruptcy punishes those who took excessive risks while preserving those aspects of a businesses that remain profitable.
In contrast, a bailout transfers enormous wealth from taxpayers to those who knowingly engaged in risky subprime lending. Thus, the bailout encourages companies to take large, imprudent risks and count on getting bailed out by government. This “moral hazard” generates enormous distortions in an economy’s allocation of its financial resources.
Thoughtful advocates of the bailout might concede this perspective, but they argue that a bailout is necessary to prevent economic collapse. According to this view, lenders are not making loans, even for worthy projects, because they cannot get capital. This view has a grain of truth; if the bailout does not occur, more bankruptcies are possible and credit conditions may worsen for a time.
Talk of Armageddon, however, is ridiculous scare-mongering. If financial institutions cannot make productive loans, a profit opportunity exists for someone else. This might not happen instantly, but it will happen.
Further, the current credit freeze is likely due to Wall Street’s hope of a bailout; bankers will not sell their lousy assets for 20 cents on the dollar if the government might pay 30, 50, or 80 cents.
The costs of the bailout, moreover, are almost certainly being understated. The administration’s claim is that many mortgage assets are merely illiquid, not truly worthless, implying taxpayers will recoup much of their $700 billion.
If these assets are worth something, however, private parties should want to buy them, and they would do so if the owners would accept fair market value. Far more likely is that current owners have brushed under the rug how little their assets are worth.
The bailout has more problems. The final legislation will probably include numerous side conditions and special dealings that reward Washington lobbyists and their clients.
Anticipation of the bailout will engender strategic behavior by Wall Street institutions as they shuffle their assets and position their balance sheets to maximize their take. The bailout will open the door to further federal meddling in financial markets.
So what should the government do? Eliminate those policies that generated the current mess. This means, at a general level, abandoning the goal of home ownership independent of ability to pay. This means, in particular, getting rid of Fannie Mae and Freddie Mac, along with policies like the Community Reinvestment Act that pressure banks into subprime lending.
The right view of the financial mess is that an enormous fraction of subprime lending should never have occurred in the first place. Someone has to pay for that. That someone should not be, and does not need to be, the U.S. taxpayer.
Fannie, Freddie and What We Should Learn
I can think of a particular friend of mine who is probably wondering about Fannie, Freddie and what it all means. I’m no economist. But I am a thinker. Here’s my take:
Congress, in all it’s infinite wisdom, wanted to do something to help those who couldn’t afford to buy a house. So they created FHA loans, VA loans and Fannie Mae and Freddie Mac.
All this federal backing, whether through government guarantees or artificially low taxpayer subsidized interest rates, did accomplish what was intended; more people could buy houses. But they forgot one thing; the people they were helping CAN’T AFFORD TO BUY A HOUSE.
Banks didn’t care about individuals ability to pay loans back because they would just sell the loan to Fannie and Freddie, and you and I, the taxpayers, would guarantee the mortgage of individuals whom the open market deemed too risky.
This drove up demand for housing and in turn, drove up housing prices artificially high. This caused a dramatic increase in home building until the bubble popped, and the housing glut caused prices to fall.
When those prices fell, the economy tanked, people lost jobs and surprise surprise, many of those who the government “helped” defaulted, sending Freddie and Fannie into the tailspin they find themselves in.
The result: the government now ostensibly owns half of all mortgages in the U.S. Does anyone else hear the Soviet national anthem playing in their heads?
Now to be sure, there was some shady things going on with Fannie and Freddie’s management. They were given incentives by congress to produce short term gains and they sometimes cooked the books to do it. They should go to jail. But so should the morons in congress who created this mess, and those overseeing it who looked the other way in exchange for campaign donations.
If the government lets Fannie and Freddie fail, things would get much much worse very quickly. Lending would dry up. The economy would tank even further. More job losses would occur causing more mortgage defaults, and the cycle would repeat.
But by bailing them out, they are continuing the cycle of an over reaching government causing more problems, rewarding failure, punishing those who are responsible, taking more freedom through taxation and regulation, and making us all less prosperous.
Fred Thompson summed it up best:
“Our Founding Fathers knew more than a little bit about human nature. It is one reason why in the Constitution, the federal government was given certain delineated powers and no others. I hate to burst another bubble, but our government simply doesn’t have the authority or the capability to be the guarantor or insurer of our every need or desire. Isn’t it time we started sending that message loud and clear to the big enablers in Washington?”
Governor Palin Compared to Pontius Pilate on the House Floor
In response to Governor Sarah Palin – FROM THE FLOOR OF THE UNITED STATES HOUSE OF REPRESENTATIVES, a Democrat congressman from Memphis, Steve Cohen said, “If you want change, you want the Democrat Party. Barack Obama was a community organizer like Jesus, who our minister just prayed about. Pontius Pilate was a governor.”
While these clowns hand out billions of our hard earned dollars like it’s nothing, they pull crap like this. It’s offensive and disgusting. And once again, if he were a republican, there is no doubt this would be the lead story by EVERY paper and news channel.
Ronald Reagan in a Skirt?
There was a lot of hype leading up to Sarah Palin’s debut on the national stage last night - so much that I consciously tried to lower my expectations.
The first thing I noticed was her family. The media’s go-to game plan with any unabashed conservative is to paint them with the “evil, cold-hearted greedy pig” brush. When Sarah’s 7-year old daughter wet her hand to smooth down here baby brothers hair, my heart melted.
The media is going to have to leave the “evil conservative” brush in the box.
And the speech, well, ordinarily I would have pulled some of my favorite quotes, but the whole darn thing is one giant quote. It was phenomenal beyond expectations. All that pressure, all that hype, and someone forgot to pause the teleprompter for audience applause! She had to wing a significant part of that speech and did it flawlessly. (Memo to Senator Obama: note the lack of ums and uhs despite the lack of a teleprompter.)
Was I the only one who for a brief moment forgot about John McCain?
This woman is dangerous and the left knows it. She’s one of us. She can relate to us. She’s impossible to hate. She was totally at home and comfortable despite the enormous pressure. She’s a card carrying, freedom loving constitutional conservative. She knows what she believes and she doesn’t apologize for it. She can sell it and she can sell it in plain english directly to the American people.
Glenn Beck put it best, “She’s Ronald Reagan in a skirt.”
Regardless of what happens in November, provided that what we saw was the real Sarah Palin (Oh please, oh please, oh please let this be the real Sarah Palin), we have witnessed the birth of a future presidential contender.
I have only one question: is it too late to flip the ticket?
—–
Here’s a few of my favorites:
(Full text found here: http://abcnews.go.com/print?id=5720910)
And since our opponents in this presidential election seem to look down on that experience, let me explain to them what the job involves.
I guess a small-town mayor is sort of like a “community organizer,” except that you have actual responsibilities. I might add that in small towns, we don’t quite know what to make of a candidate who lavishes praise on working people when they are listening, and then talks about how bitterly they cling to their religion and guns when those people aren’t listening.
We tend to prefer candidates who don’t talk about us one way in Scranton and another way in San Francisco.
—
But here’s a little news flash for all those reporters and commentators: I’m not going to Washington to seek their good opinion - I’m going to Washington to serve the people of this country. Americans expect us to go to Washington for the right reasons, and not just to mingle with the right people.
—
I came to office [governor of Alaska] promising major ethics reform, to end the culture of self-dealing. And today, that ethics reform is the law.
While I was at it, I got rid of a few things in the governor’s office that I didn’t believe our citizens should have to pay for.
That luxury jet was over the top. I put it on eBay.
I also drive myself to work.
And I thought we could muddle through without the governor’s personal chef - although I’ve got to admit that sometimes my kids sure miss her.
—
I told the Congress “thanks, but no thanks,” for that Bridge to Nowhere.
If our state wanted a bridge, we’d build it ourselves. When oil and gas prices went up dramatically, and filled up the state treasury, I sent a large share of that revenue back where it belonged - directly to the people of Alaska.
—
Our opponents say, again and again, that drilling will not solve all of America’s energy problems - as if we all didn’t know that already.
But the fact that drilling won’t solve every problem is no excuse to do nothing at all.
Starting in January, in a McCain-Palin administration, we’re going to lay more pipelines … build more new-clear plants … create jobs with clean coal … and move forward on solar, wind, geothermal, and other alternative sources.
—
[On Obama]
This is a man who can give an entire speech about the wars America is fighting, and never use the word “victory” except when he’s talking about his own campaign. But when the cloud of rhetoric has passed … when the roar of the crowd fades away … when the stadium lights go out, and those Styrofoam Greek columns are hauled back to some studio lot - what exactly is our opponent’s plan? What does he actually seek to accomplish, after he’s done turning back the waters and healing the planet? The answer is to make government bigger … take more of your money … give you more orders from Washington … and to reduce the strength of America in a dangerous world. America needs more energy … our opponent is against producing it.
Victory in Iraq is finally in sight … he wants to forfeit.
Terrorist states are seeking new-clear weapons without delay … he wants to meet them without preconditions.
Al Qaeda terrorists still plot to inflict catastrophic harm on America … he’s worried that someone won’t read them their rights? Government is too big … he wants to grow it.
Congress spends too much … he promises more.
Taxes are too high … he wants to raise them. His tax increases are the fine print in his economic plan, and let me be specific.
The Democratic nominee for president supports plans to raise income taxes … raise payroll taxes … raise investment income taxes … raise the death tax … raise business taxes … and increase the tax burden on the American people by hundreds of billions of dollars.
—
[On McCain]
Harry Reid, the Majority Leader of the current do-nothing Senate, not long ago summed up his feelings about our nominee.
He said, quote, “I can’t stand John McCain.” Ladies and gentlemen, perhaps no accolade we hear this week is better proof that we’ve chosen the right man. Clearly what the Majority Leader was driving at is that he can’t stand up to John McCain. That is only one more reason to take the maverick of the Senate and put him in the White House.
—
And though both Senator Obama and Senator Biden have been going on lately about how they are always, quote, “fighting for you,” let us face the matter squarely.
There is only one man in this election who has ever really fought for you … in places where winning means survival and defeat means death … and that man is John McCain.
GOP Convention Coverage Bias – What a Shock
Since we haven’t sprung for a satellite dish, I was forced to watch the first night of GOP convention coverage from the “main stream media” (MSM), mainly PBS and NBC. The bias is just amazing. I know, I know, gee what startling revelation will I learn next, the sky is blue, dogs bark, etc.
What continues to amaze me though is the blatantly obvious ways in which that bias in manifested. I long for the old days when a political round table would consist of a far left pundit, a clearly left pundit, a liberal republican that almost never agreed with his party and a token moderate conservative who couldn’t string two coherent words together if his life depended on it. In that scenario, the moderate still managed to make a few points. Now days, NBC hasn’t bothered with the latter two individuals.
During the Obama blessing, er uh democratic convention, you had to wade through a 15 minute NBC love fest from sympathetic talking heads that were as giddy as school girls after a first date. If you listened really closely, you could catch a question or comment that almost approached what some might call a criticism, quickly followed by another 15 minute love fest.
Ever since McCain announced Alaska governor Sarah Palin as his running mate, we have heard nothing but story upon story about her 17 year old daughter’s pregnancy, the nasty divorce of her sister from a state trooper and her husband’s 22 year old DUI. The politics page of the New York Times featured three stories on Palin’s daughter alone yesterday.
Yet search that same site for William Ayers, a close friend and supporter of Obama who admitted participating in the bombings of New York City Police Headquarters in 1970, the Capitol building in 1971, and the Pentagon in 1972 and you get nothing. I gave up finding a critical headline after wading through 5 pages of search results.
If I hear the word “historic” in the same sentence with “Obama” one more time, I think I’m going to be sick. Why is it the party who parades around as a champion of minorities is always the one pointing out the color of a person’s skin? It seems a real “historic” figure a while back wanted to focus on the content of one’s character, not the color of their skin. But then again, that may be the problem with Senator Obama.
Obama’s life is laced with questionable characters and shady deals from his years in the infamous Chicago political racket. Yet somehow, NBC never gets around to doing the hard interviews there. They do however, find it necessary to send a crew clear to Alaska to do a feature interview with Governor Palin’s former brother-in-law; a follow-up to the 20 minutes NBC opened with yesterday on Palin’s daughter. Way to cover the important stories NBC!
Back at the convention, PBS interviews two republican congresswomen about the Palin choice. Questions, of course, revolve around the afore mentioned cherry picked stories. Then, the interviewer has the audacity to question Governor Palin’s ability to balance her work and family life, given her 5 children. Thank God the congresswoman from New Mexico had the cahonas to fire back about the pure sexist nature of the question. No one was questioning Obama’s ability to be a father and a President at the same time. What’s laughable is how different this conversation would have been if Palin were a democrat. They would all be marveling at the “super mom” who does it all so well.
Back on NBC, they tape-delayed President Bush’s address to the convention and “forgot” to include the crowd reaction Bush could hear in his ear piece, so his speech was full of these odd dead silent pauses that made him look like he couldn’t speak (I know, not much of a stretch). Brian Williams later apologized for the bad feed. Sure Brian, I’m sure that was a mistake.
Then, they didn’t bother to carry even half of Fred Thompson’s speech; probably because it was the best speech of the night. On PBS, we had to listen to their annalists who were all, shockingly, critical of the convention and were constantly saying how McCain, Mr. moderate himself, had to move to the “center”, given his “right wing” choice for a running mate. Memo to PBS, the latest non-partisan polling shows 60% of Americans identify themselves as conservative; if McCain wanted half of them to stay home he would follow your advice. That’s weird, it’s almost like you want him to loose.
This was followed by Tom Brokaw re-reading parts of Fred’s speech. Nothing gets me more fired up then Tom reading phrases he clearly doesn’t agree with. Of course, NBC did find it acceptable to broadcast the entire speech of democrat Joe Lieberman who is supporting McCain. Listening to Lieberman’s monotone, whiny voice is like watching golf on Sunday afternoon; it’s guaranteed to put you to sleep.
On the schedule tonight, Sarah Palin. $10 says her daughter is referred to at least 20 times in the coverage.
Bravo Okies, You Go!
On the coat tales of Montana’s Secretary of State threatening open secession from the Union if the Supreme Court came down the wrong way on the 2nd Amendment (frighteningly enough, 4 of the 9 ‘mulas’ are apparently illiterate, or left their copy of the Constitution at home that day), the people of Oklahoma are feeling nostalgic for the limited federal system of pre-civil war America too.
Walter E. Williams latest column outlines the resolution before the state legislature:
Oklahomans are trying to recover some of their lost state sovereignty by House Joint Resolution 1089, introduced by State Rep. Charles Key.
The resolution’s language, in part, reads: “Whereas, the Tenth Amendment to the Constitution of the United States reads as follows: ‘The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.’; and Whereas, the Tenth Amendment defines the total scope of federal power as being that specifically granted by the Constitution of the United States and no more; and whereas, the scope of power defined by the Tenth Amendment means that the federal government was created by the states specifically to be an agent of the states; and Whereas, today, in 2008, the states are demonstrably treated as agents of the federal government. … Now, therefore, be it resolved by the House of Representatives and the Senate of the 2nd session of the 51st Oklahoma Legislature: that the State of Oklahoma hereby claims sovereignty under the Tenth Amendment to the Constitution of the United States over all powers not otherwise enumerated and granted to the federal government by the Constitution of the United States. That this serve as Notice and Demand to the federal government, as our agent, to cease and desist, effective immediately, mandates that are beyond the scope of these constitutionally delegated powers.”
Key’s resolution passed in the Oklahoma House of Representatives with a 92 to 3 vote, but it reached a bottleneck in the Senate where it languished until adjournment. However, Key plans to reintroduce the measure when the legislature reconvenes.
Bravo Okies. Bravo. Given the current bastardization of the intended checks, balances and seemingly non-existent federal limits, patriots have held little hope of nationally elected officials moving the country more towards the free and limited system the founders envisioned. But maybe there’s a glimmer of hope if more states begin following the lead of the above patriot states.
Uh Al? About that ‘Consensus’ on Global Warming…
How many dissenting scientists does it take to seriously call into question the IPCC and former VP Al Gore’s contention that the ‘debate is over’? No, this isn’t a bad joke. Seriously, 100? 200? 500? 1,000? How about over 30,000? That’s right, 31,000+ scientists, including over 9,000 with PhDs, are risking career suicide by openly signing a petition rejecting the current consensus on Global Warming.
More than 31,000 scientists have signed a petition rejecting claims of human-caused global warming. The purpose of OISM’s Petition Project is to demonstrate that the claim of “settled science” and an overwhelming “consensus” in favor of the hypothesis of human-caused global warming and consequent climate damage is wrong. No such consensus or settled science exists. As indicated by the petition text and signatory list, a very large number of American scientists reject this hypothesis.