Real Stimulus

The WSJ article on the building of a new military vehicle illustrates that defense spending is "stimulus" spending too, according to those who believe government spending "stimulates" the economy.

As I discussed earlier (see here), one of the few categories of spending that didn't increase in Obama's "stimulus" plan was defense spending - despite the wear and tear our military equipment has incurred in the wars in Iraq and Afghanistan, and despite the fact that the military has long-range plans to acquire weapons that could be accelerated in an economic downturn to provide jobs today without increasing government spending over a longer-term budget cycle.

And the fact that such spending didn't increase, gives the lie as to what the Democrats' plan was all about - spending money on Democratic constituents and priorities.

Sotomayor to Obama: You Made a Bad Pick

That's right, Sonia Sotomayor, Barack Obama's nominee for the Supreme Court, says she disagrees with Obama's view on the importance of empathy in judicial decisions.

Obama, as part of the left's desire to overturn centuries-old legals traditions, believes judges shouldn't just weigh the law when deciding a case. Instead, a judge should also feel empathy for the parties to a case.

Of course, what that means is difficult to know. In a case involving a murder, is the defendant on trial for the crime deserving of empathy (say for a difficult childhood or living in poverty), or the victim?

Or are the fireman in the New Haven case deserving of empathy because they studied hard and passed the test for promotion in New Haven but were denied promotion because too many of them were white, or instead do the minority candidates who failed the test warrant our empathy?

As you can quickly see, empathy is just another excuse for a judge to smuggle their preferences into judicial decision-making.

So Judge Sotomayor tells the Senate Judiciary Committee during her confirmation hearings that Obama is wrong about the importance of empathy to the work of judges.

If one didn't know better, she sounds more conservative than Republican nominees to the court!

Nanny State

Under the new credit card law that goes into effect next year, people under 21 will need their parents to be responsible for the credit card unless they can demonstrate sufficient income to qualify for the credit card on their own.

The theory is that kids will pile up debts because of the existence of the credit cards, so by putting parents on the hook for credit card spending, fewer young adults will have credit cards or will have their bill picked up by their parents.

The law makes it harder for young adults to build a credit history. And since a credit history is important to engaging in other credit-oriented transactions, such as renting an apartment, young adults will have a harder time becoming financially independent.

As such, in the name of "helping" kids, the law will hurt those who use credit responsibly, while those who abuse credit will probably find other ways to run into financial problems.

I wonder if all the young adults who voted for Obama counted on his treating them as children?

Faux Scandal

The Democrats are trumpeting the "secret" CIA efforts to consider targeted killings of Al Quaeda. What's more astounding is that we haven't been doing this for the past eight years, since we have certainly been waging war against Al Quaeda.

The CIA planned to tell Congress about this effort if it ever got to the operational stage, and since it didn't, there was not much to report.

The Democrats are seeking to make a scandal out of nothing, in an attempt to deflect attention from Nancy Pelosi's lies about what she knew, and when she knew it, regarding interrogation tactics such as waterboarding.

And by feigning outrage over planning exercises, the Democrats will deter the CIA from pursuing its mission to protect America through spying and covert missions. Why undertake dangerous and risky efforts if it will lead to Congressional investigations and possible prosecutions, while Democrats seek to score political points?

The true outrage is the behavior of the Democrats, who have time and again sought to undermine America's interests in pursuit of political power.

More Dumb Republicans

Republican Senator Orrin Hatch and Representative Joe Barton are leading a Congressional effort to investigate the NCAA's Bowl Championship Series in college football.

Politicians think they can curry favor with voters by taking a popular stand, since many would like to see a playoff system in college football. But the government has no business investigating the organization of college football.

The government isn't the arbiter of every difference of opinion in the country. Its scope of responsibilities relate to the legitimate functions of government.

If the legitimate functions of government include determining the proper structure of college football playoffs, then we take further steps toward an all-intrusive government.

Wal-Mart Sellout

Wal-Mart's decision to support greater government control of health care is not a sign that companies "believe in" socialized medicine on principle. Instead, it represents Wal-Mart's attempt to gain a competitive advantage against its competitors.

Its competitors tend to have fewer employees with health benefits than Wal-Mart, so government proposals to require companies to pay for employees' health insurance hurts Wal-Marts' competitors more than Wal-Mart.

It is a sad and disturbing day to see one of America's great companies succumb to the political and PR assault waged against it by "playing the game" of trying to use the government to help yourself relative to your competitors.

But that's what happens in our mixed economy, part capitalist and part socialist, particularly when the socialist part is on the ascent.

Will They (and We) Ever Learn?

Barney Frank, the key Congressman on financial services legislation, is pressing Fannie Mae and Freddie Mac to lower their lending standards for buyers of condos.

This is consistent with Frank's comments during the housing boom, when he said he wanted Fannie / Freddie to "roll the dice" on making mortgage loans.

The first "roll of the dice" was a major contributor to our financial crisis. And now Barney Frank wants to do it again.

Since we, as voters, let him get away with his role in promoting the financial meltdown we have suffered, we ultimately have no one to blame but ourselves.

This is a Problem?

The explosive growth in market penetration by the iPhone, along with Blackberry and Palm's competitor products, is one of the bright spots in our current difficult environment.

So naturally, the Obama administration sees a problem with this. The Justice Department has opened an investigation into whether telecom companies are engaging in "anti-competitive" behavior by entering into exclusive relationships for a period of time (AT&T with iPhone, Verizon with the Blackberry Storm, and Sprint Nextel with the Palm Pre).

Smaller cell phone companies, such as U.S. Cellular, are complaining that their business is suffering since their smaller size makes them less attractive partners for such an arrangement.

That's what competition is: businesses try to outdo their competitors. This is a good thing, and if some businesses suffer, so be it.

So we have the spectacle that the Obama administration is shoveling staggering subsidies to the low-growth auto industry, and is investigating for a possible lawsuit the high growth smart phone business.

This is how economic recovery is delayed and growth retarded.

The Enabler-in-Chief

The Obama administration's actions regarding Honduras are aiding Hugo Chavez's attempts to install socialist dictatorships throughout Latin America

Manuel Zelaya is supported by Venezuela tyrant Hugo Chavez, following his playbook for gradually taking control of a country through steps that individually don't provoke international outrage but collectively amount to a coup. Zelaya had ordered Honduran broadcasters to air two hours a day of pro-government propaganda, as example.

Zelaya's latest effort to enhance his power came from his desire to re-write the constitution to allow himself to run for the presidency again. When the Honduras supreme court ruled against his efforts, he sought to get ballots printed by the Chavez's regime distributed anyway.

The Honduras supreme court ordered Zelaya arrested, which the military did. His arrest and deportation is supported by the leaders of his own political party, including the interim president, Roberto Micheletti.

So what is Barack Obama's response to this effort to maintain freedom in Honduras? Naturally, it is to support Hugo Chavez's efforts to have his ally Zelaya returned to power.

I think we have a new nickname for Obama: Enabler-in-Chief for tyrants. Obama had a hard time coming to the defense of the Iranian people as its regime crackdown on protests against rigged elections; he has reached out to the tyrants in Syria; he has cozied up to the Putin regime in Russia; and he won't or can't speak against Chavez's efforts to undermine freedom in Latin America.

Obama to Bush: You Were Too Soft on Detainees

The Obama administration has suggested it may not free detainees who are found not guilty in a trial, since they may be too dangerous to release.

If this sounds like a stunning contradiction of the principles behind the left's assault on the Bush administration's detainee policies, it is.

I don't even think Bush would have tried to pull it off.

Appeasing Iran

Barack Obama has gone "all-in" on his strategy of "engaging" Iran.

He just released five Iranian security officials (aka spies) captured in Iraq suspected of supporting terror attacks in Iraq.

The administration has hid behind releasing them to Iraq authorities - who then promptly turned them over to Iran. Funny how thousands of other people remain in U.S. custody in Iraq, but not these five.

Obama hopes to payoff Iran, either for something specific in return or as a sign we can still do business with them.

Joe Biden's Whopper

Joe Biden routinely says outrageous things, often to the embarrassment of Barack Obama.

Biden recently said that the Obama administration underestimated the extent of the recession, and by doing so, undersized the "stimulus" plan.

Although it is tempting to think Biden spoke carelessly, as he often does, in this case I suspect this might be a trial balloon, to test the notion of a second "stimulus" bill.

But on substantive grounds, Biden's comment is astounding. When is $787 billion in "stimulus", and nearly $2 trillion in deficits, anything other than massive "stimulus" in the eyes of those who believe such actions stimulate the economy?

Recall that the recessions in the 1980-1982 period had higher unemployment than today, but the government had no "stimulus" plans passed, other than the real stimulus of Ronald Reagan's tax cuts later in that period.

And it is true that this wasted government spending is not that helpful, and is often hurtful, to economic recovery. But that argues for different steps, such as cutting tax rates and passing free trade bills, to promote economic growth.

It also suggest that the Obama administration realized the "stimulus" bill was more about satisfying Democrats' desire to pay off constituents than stimulus, since they didn't believe the economy would do all that badly.

Chrysler Precedent

The Obama administration's restructuring of Chrysler, which overturned normal creditor rights, is now a precedent to be imitated.

For a hockey team.

A lawyer for the Phoenix Coyotes is trying to use the Chrysler case as a precedent for a similar quick restructuring.

Rather than Chrysler being an exception due to its the "importance of the auto industry", it will encourage other bankruptcy cases to follow its bad example.

The result will be a higher cost of capital and reduced economic growth, as creditors need to consider the risk that their priority in bankruptcy won't be honored and demand higher interest rates to offset the greater risk.

Socialism, Republican-Style

Charlie Crist, the Republican governor of Florida and a possible presidential candidate in 2012, has vetoed a bill to reform Florida's atrocious hurricane insurance system.

Under Crist, the state of Florida picked up hurricane insurance coverage for many homeowners by charging rates that are too low. Republicans in the state legislature passed a reform bill to reduce the state's potential $18 billion liability, but Crist vetoed it.

Homeowners like the low rates, and since Crist wants to curry their favor in his run for the U.S. Senate in 2010, the veto allows him to pander to voters - at the risk of staggering losses to the state in the next big hurricane.

In effect, Crist is rolling the dice that he will be elected to the Senate before the next hurricane disaster hits. Meanwhile, Florida taxpayers bear the risk of this strategy.

For those who think a federal government health plan will be priced properly (i.e., to truly cover all costs), think again. As the Florida example shows, politicians much prefer to manipulate prices of government-provided goods or services to placate voters than to charge actuarially sound prices.

Where's the Stimulus?

The Commerce Department recently reported that the personal savings rate jumped to 6.9% in May, up from 5.6% in April. Analysts have attributed the increase partly to government payments to senior citizens under Obama's "stimulus" plan.

But if people save the "stimulus" money they get, it isn't doing what the advocates of such "stimulus" spending hope for - which is for consumers to spend the additional income.

Instead, if people save the money, they are offsetting the borrowing by the government to pay for the "stimulus", negating its impact.

But it's no big deal; it isn't as if we just spent $787 billion on the "stimulus" plan.

Who Needs Missile Defense Anyway?

Barack Obama's defense budget cuts missile defense spending, at the very time Iran and North Korea are making progress on developing ballistic missiles.

Astounding, but true.

And why would they do this?

Because they believe, in the spirit of arms control, that by renouncing defensive capabilities we can make our enemies less nervous and reduce their weapons development.

Instead, Iran and North Korea will be emboldened to develop their missiles if they believe less defenses exist to shoot them down. If we had robust defensive systems, or at least they perceived we did, they would worry that their massive investment in missile development would be wasted.

Of course, the administration has also moved the defensive systems we have to Hawaii to protect it in case North Korea launched missiles towards us - the same systems that so many in the administration advocated against when developed under George Bush.

So much for the new "realism" in our foreign and defense policies.