How the GOP can regain its political “brand”

How can the Republican Party (GOP) really distinguish itself from the Democrats?

By taking clear, well-articulated positions for:

1. LIMITED CONSTITUTIONAL GOVERNMENT - Retrenching the expanding federal reach, doing away with federal grants-in-aid to state and local governments while simultaneously reducing the federal tax burden so that state and local governments are at greater liberty to do what needs to be done based on local realities (or not do what does not need to be done, as the case may be). Along with this, Congress should take specific action to re-articulate and reinforce states' rights and the return of greater liberty to U.S. citizens.
   
2. FREE MARKETS - Taking a strong and well-articulated stand against corporatism and bailouts for businesses or unions, presenting a new vision for unfettered economic growth to the middle class. This vision should include reducing the regulatory burden on business and industry by granting increased liberty to individuals (the consumers) to decide more about what they want and don't want in products, in services, in their employment and in benefits.
   
3. SOUND MONETARY POLICY - Get control of the Federal Reserve Bank (FRB)  to help re-establish the value of the U.S. Dollar ( USD ), which is being gradually destroyed through inflation since the inception of the Federal Reserve banking system.

How about some good old political repentance from the GOP?

I think that there would be few things more beneficial to the Republican Party (GOP) than a general catharsis of heartfelt repentance among its politicians for their unprincipled behavior with regard to limited government, the U.S. Constitution, support for corporate bailouts, and their general propensity to succumb to pressure from special interests.

For GOP officeholders to simply stand before the public and say:

"We see where we are have gone wrong and have found that you, the people, are wiser than we thought we were.  Forgive us.  We are going to change our ways.  We are going to fight for YOU and return power to YOU and cease from our own corrosive power-seeking ways that have helped lead our nation to this brink of disaster and the collapse of sound government."

This would be a great thing, would it not? And it would, to a great extent, end the fears of erosion of GOP support by third-party conservatives.

On economic growth versus political control

Economic growth is radically unpredictable and, almost more than anything else, politicians want control and the power it brings to them.

The most important economic developments happen at the leading edge of the economy where innovations frequently cause things to be slightly out of control. Therefore, meaningful economic advance does not work well within the confines of so-called "scientific economics" or the "planned economy."

The economic activity that drives rapid growth, rapid increases in capital (production of profits) and the growth of new jobs cannot be foreseen in mechanistic terms or easily predicted using mathematical formulas.

This explains why so many of the economic interventions by politicians and government work against innovation and rapid economic growth. Instead, while seeking control, politicians and governments tend to preserve the old industries and firms that are not on the growing edge of the economy. Politicians are far more likely to waste taxpayer money trying to resuscitate dinosaur corporations and industries for the sake of the equally outdated and outmoded unions than to aid any truly innovative entrepreneurs. As a result, government actions actually damage the long-term prospects for the economy and this means the economy will take longer to recover than if government had not intervened at all.

Leftists, Liberals and the War on Liberty and the Economy

Edward H. Crane, president of Cato Institute, writing in “Cato Policy Report” (Nov/Dec 2011), properly characterizes the Left here in the U.S.:

Of course, the Left has pretty much given up any claim to being champions of liberty these days. Speech codes on campus and restrictions of political speech show their disdain for the First Amendment. Double-down on troops in Afghanistan? Okay if the president’s a liberal. Then there’s the Left’s profound ignorance on how wealth is created. They love to focus on how to alleviate poverty when the [real] answer is wealth creation. Poverty is the natural state of man. Prosperity requires free markets, respect for contracts, and protection of private property. No big secret, but it seems to escape the Left.

So you have the Obama administration trample centuries of business law [Common Law] by denying Chrysler bondholders their contractual right to be first in line for assets sales under bankruptcy, and instead giving those rights to the UAW [United Auto Workers union], which had no such claim [under the law]. Property rights abused; the difficulty in selling corporate debt increased. The earned income of the rich? We’ll just take it and give it to those who didn’t earn it. Property rights abused; the incentive to create wealth undermined.

Part of the legacy of George W. Bush and the Republican Congress

Under George W. Bush and the Republican-controlled Congress there was an explosion in the growth of big government on virtually every front. Large increases in spending were accompanied by huge deficits and a doubling of the national debt. Corporatism exploded, too, in the form of bailouts and there was increasingly centralized power in education, expansion of Medicare and rapid growth in government regulation.

George W. Bush did not veto a single spending bill in his eight years in office.

Please listen to the WARNINGS!

Here's a message I just sent to many members of Congress:

Recently, an essay published by the governor of the People's Bank of China appeared to favor the creation of an IMF currency to replace the U.S. dollar as the world's reserve currency. This, of course, is a tragic sign as the U.S. has been the safe haven for investors from around the world for the greater part of the last century.

In Europe, the outgoing president of the European Union, the Czech Prime Minister Mirek Topolanek, described America's current plan to fight the widening global recession as the "road to hell." Then British Member of the European Parliament Daniel Hannan made worldwide news headlines by rebuking the UK's own inflationary and debt-focused policies.

Meanwhile, Pres'ent Obama's administration carried on an effective public relations campaign to convince the U.S. citizenry and the rest of the world that if the world just worked together, everything would be "okay" -- even if they worked together mostly doing the WRONG things. That seemed to pretty much put most everyone back to sleep.

The Washington drumbeat is that our economic woes result from a lack of consumer spending. Therefore, Pres'ent Obama and the Democrat-controlled Congress seem intent on making up for all the U.S. citizens by spending money the government does not have. It hardly seems reasonable that the cure for the sick man's disease is to drain blood from his leg while trying to inject it back in his arm.

To postpone inevitable (formal) tax increases, it seems the Obama administration is content with a strategy of printing money. Of course, printing money is just another form of taxation. Rather than taking money out of the citizens' pockets, the administration is satisfied with simply robbing the currency itself of its purchasing power.

The things that are lacking in the current worldwide recession are PRODUCTION and CAPITAL (trillions of dollars of capital having been destroyed in the bursting of the "bubble"). It is PRODUCTION, not spending, that will building capital and restore purchasing power -- not the printing of currency that is ever more diluted in value. Besides, if the government simply prints more money, it won't allow Americans to buy more things because the things. They will just be able to buy less stuff at higher prices.

Obama's economic advisers seem to have convinced themselves -- and Congress -- that more debt and government spending will restore growth and ultimately allow the repayment of the huge debt. However, when all of the entitlement obligations come due over the next decade (i.e., Social Security, Medicare and other welfare), these obligations will amount to TENS OF TRILLIONS OF DOLLARS and the federal government will have NO ALTERNATIVE but to repudiate much of the debt (perhaps through hyper-inflation as other nations have done).

But, even if that were not true, Pres'ent Obama's assumption that additional borrowing and spending will restore growth is wrong on the face of it. IN FACT, MORE CONSUMER DEBT AND GOVERNMENT SPENDING WILL UNDERMINE OUR ECONOMY AND KEEP IT FROM GROWING. We borrowed and spent ourselves INTO this current situation. We must now SAVE AND PRODUCE ourselves OUT of the recession.

However, as long as the Pres'ent Obama administration and Congress are intent on propping up the FALSE ECONOMY, rather than letting it COLLAPSE, their CAN BE NO REBUILDING of a GENUINE ECONOMY.

Calls from other nations that actually see things clearer than do we will simply get LOUDER AND LOUDER until we are willing to FACE THE UGLY TRUTH.

What are YOU going to tell them?

My latest message to Congressional leaders

Here's a message I just sent to some in Congress:

This if from a fund-raising message I received from Sen. John Cornyn:

"Frankly, it's unthinkable to me that a company American taxpayers bailed out would hand out bonuses to their executives. Where I come from - and pretty much everywhere except Washington, D.C. - you pay people to succeed - not to fail."

Since we "pay people to succeed -- not to fail," why are we paying anyone in Congress?

Remember, there have been lots and lots of opportunities for Republicans to stand up and ACT LIKE REPUBLICANS over more than THREE DECADES to address what was happening with the Fed's management of credit and the actions of FNMA and FHLMC. Far too many Republicans did NOTHING or, worse, VOTED with the Democrats.

It was a REPUBLICAN PRESIDENT, George W. Bush, that promoted the AIG bailout. It was NOT a Republican thing to do, however. Republicans are supposed to believe in FREE MARKETS and LIMITED GOVERNMENT. This is NOT a FAILURE of capitalism or the free market principles. This is yet another FAILURE of GOVERNMENT INTERVENTION in free markets and Republican actions have merely allowed the DEMOCRATS to cover over the FAILURE of such policies.

If REPUBLICANS WOULD ACT LIKE REPUBLICANS all the time, you would NOT be forced to put out SCHIZOPHRENIC FUND RAISING MATERIALS like the one I just received -- On the one hand blaming LIBERAL DEMOCRATS while, on the other hand, saying WE NEED MORE GOVERNMENT INTERVENTION in the affairs of the free market.

QUIT IT -- and ACT LIKE MEN OF INTEGRITY.

What are YOU going to tell them?

No Founding Father He

From ThePatriotPost

Obama White House Maneuvers for Permanent Control

The real DANGER is that the machinations of the current Democrat Congress and the Obama administration are NOT just doing damage to the U.S. economy. Many of their moves are designed to secure a political LOCK-IN for years to come.

1. Place control of the upcoming 2010 U.S. census in the hands of the White House to assure the outcome is favorable to Democrats when reapportionment comes about.

2. Save the TRADE UNIONS from their slow demise through deceptive new legislation -- because union members vote Democrat in disproportionate numbers.

3. Vastly increase the number of GOVERNMENT EMPLOYEES -- at all levels -- because government employees vote Democrat in disproportionate numbers.

4. Enlarge existing and create entirely NEW ENTITLEMENT PROGRAMS because those who receive government hand-outs vote Democrat in large numbers.

5. Assure that no legislation encumbers the U.S. election processes with anything that could be called real INTEGRITY, for the fraud virtually always favors Democrats.

6. Give government handouts to groups like ACORN, because these groups encourage election fraud and abuse, and they stir up class envy and hatred, which tends to work in the favor of Democrats at the polls.

7. Provide GOVERNMENT BAILOUTS to banks and securities trading firms in order to ingratiate them to the Democrats and to assure a continuing stream of political contributions from this sector of the economy.

8. Encumber FREE SPEECH through rules and regulations tended to, more than anything else, quash conservative conversation in the public media.

9. Encourage continuing ILLEGAL IMMIGRATION because illegal immigrants -- who shouldn't be allowed to vote in the U.S. elections AT ALL -- vote disproportionately in support of Democrats.

I'm sure there's more, I just can't think of them at this moment.

Preserve Common Law

Here's a message I just sent to dozens of U.S. Senators:

Why is it that The White House, the House of Representatives and the Senate are relying on the same dopes that did NOT see the financial crisis coming, and said everything was fine, to tell us how to fix it? Maybe, just maybe, you ought to be looking to some of those who ACTUALLY DID SEE the crisis headed our way for ideas about how to fix the problems.

If the U.S. Congress grants power to bankruptcy judges to modify the terms of troubled mortgages, that single action will UNDO the precedent of 500 years of common law. Contracts will be a matter of question for centuries to come.

The FREE MARKET and LIMITED GOVERNMENT can resolve ALL OF THESE PROBLEMS. The kind of actions Congress is proposing will lead to PERMANENT and IRREVERSIBLE DAMAGE to the U.S. economy.

Please OPPOSE THIS ACTION and any further BAILOUTS! Thank you.

What are YOU going to tell them?

False Hopes of Economic Stimulus

From Mises.org

Why the Democrats' Economic Stimulus Plan Will Fail

Read this enlightening article here.

Thanks.

Humor from the Patriot Post

from Patriot Post. Enjoy.

Yet Another Stimulus Package Being Considered

I just sent the following letter to my delegates in the U.S. Senate and House of Representatives:

Dear _________________:

Please take your time putting together a stimulus package. And I would like to see the following changes made to the package:

1. Across the board corporate and personal income tax cuts to leave more money in the pockets of U.S. individuals and corporations for spending.

2. No more application of socialist means in attempts to 'save' capitalism. In other words, NO MORE BAIL-OUTS.

3. Reduce (suspend or permanently eliminate) burdensome, needless and costly restrictions on U.S. industries such as the ridiculous CAFE standards on the auto industry.

4. Open up the continental shelf and other areas for off-shore drilling immediately.

5. Open up ANWR for drilling immediately.

6. Provide some form of amnesty or a moratorium on frivolous law suits that presently inhibit or stop entirely the development of new oil refineries in the U.S.

All of these actions WOULD STIMULATE THE ECONOMY and WOULD LEAD TO JOB CREATION without reckless government spending and huge increases in public debt.

Thank you for listening.

What are you going to do?

Management "plunder" on the Shareholders' behalf

"Paper entrepreneurialism is both cause and consequence of America's faltering economy. Paper profits are the only ones easily available to professional managers who sit atop organizations designed for a form of production that is no longer appropriate to America's place in the world economy. At the same time, the relentless drive for paper profits has diverted attention and resources away from the difficult job of transforming the productive base. It has retarded the transition that must occur, and has made change more difficult in the future. Paper entrepreneurialism thus has a self-perpetuating quality that, if left unchecked, will drive the nation to further decline."

-- Robert B. Reich, "The next American frontier," Atlantic, March 1983, pp. 43-57.

It's been 25 years! Haven't we learned anything.

An Open Letter to U.S. Leaders

22 December 2008


President George W. Bush,
Honorable Senators, and
Honorable Representatives:

W. Edwards Deming, writing in Out of the Crisis (Massachusetts Institute of Technology), p. 98, a book written when U.S. automaker Chrysler sought federal loan guarantees more than 25 years ago, says:

“As William E. Hoglund, manager of the Pontiac Motor Division, put it to me [Deming] one day, ‘Blue Cross is our second largest supplier.’ The direct cost of medical care is $400 per automobile (‘Sick call,’ Forbes, 24 October 1983, p. 116). Six months later he told me that Blue Cross had overtaken steel. This is not all. Additional medical costs are embedded in the steel that goes into an automobile. There are also direct costs of health and care, as from beneficial days (payment of wages and salaries to people under treatment for injury on the job); also for counseling of people depressed from low rating on annual performance, plus counsel and treatment of employees whose performance is impaired by alcohol or drugs.”

I should think that the U.S. automakers have had more than sufficient time to get their house in order. It is clear that short-term thinking – the desire to earn quarterly bonuses – has overtaken any constancy of purpose on the part of executive management to keep the U.S. automakers viable (let alone successful).

The assets owned by U.S. automakers will NOT evaporate overnight if they must declare bankruptcy. Other firms with fresh new ideas will soon take advantage of the void in the marketplace and will leverage the labor and assets that become available to establish successful and profitable new manufacturers.

It is NOT the responsibility of the U.S. taxpayer to underwrite the long-term failure of private sector managers (or the failures of union managers to properly assess their own organization’s long-term viability). Please, NO MORE BAILOUTS to “save us” from the BAD ECONOMICS of Democrats and their cronies in the unions and elsewhere. Let the Democrat economics FAIL so that we can move onward, upward and away from more socialist means and methods.

Abandoning Capitalism to Save Capitalism?

Over the past few months we’ve seen the most extensive government intervention in the economy since the 1930’s. In fact, today’s interventions sometimes make those of Franklin Roosevelt look tame by comparison.

Depending upon how you calculate the numbers—and that is made particularly difficult because neither the Federal Reserve or the Treasury is being particularly transparent about what they are doing—the Federal government is already on the hook for around $8 Trillion to address the current economic crisis. The CATO institute puts the number at $8.4 Trillion.

Much of that money has gone to direct investments in the financial industry, which has been partially nationalized. All indications are that soon the taxpayers will become part owners of one or more automobile manufacturers, and that the next President will be appointing a “car czar” to direct the restructuring of the auto industry, as if a government appointee can devise a magic formula for making the car companies profitable again.

This is nuts.

It would be one thing if there was any evidence that all this mucking about in the economy was doing any good, but in the months since government intervention in the economy went into overdrive the economic slump has only gotten worse. Much worse, in fact.

George Bush says that in addressing today’s financial crisis he has had to “abandon free-market principles to save the free-market system." Well, the President has certainly succeeded in abandoning free market principles, but it’s hard to see how doing so has succeeded in saving the free market system.

All this government activity has been driven by an illusion that is shared by most politicians: that somehow, some way they can control the economy. That illusion has caused more harm over the past century than all the recessions that are an inevitable part of a capitalist economy.

There has been a growing consensus among economists that the great depression became “great” precisely because of a series of policy mistakes made by Hoover, Roosevelt, and the Federal Reserve. Japan experienced a “lost decade” of economic decline after its own real estate bubble collapsed because its government tried to prop up “zombie” banks and businesses long after it was clear that they needed to go out of business. Japan blew so much money on useless “stimulus” packages that their national debt makes ours look responsible by comparison (so far). Sound familiar?

The shortest path out of the economic mess we are in is to allow the markets to correct, however painful that might be in the short run. The alternative—abandoning free market principles and the long-term benefits of free markets—promises not just a difficult recession, but a permanent slowing of economic growth and a huge increase in the national debt.

The best way to “save the free market system” is to allow it to work.

By David Strom, Senior Policy Fellow at the Minnesota Free Market Institute

I just sent this message to Congressional leaders

I oppose using TARP funds to provide emergency loans to the auto industry. As famous business professor and author Peter Drucker has said, "It is inevitable that some businesses will fail." The U.S. automakers have had their day in the sun and their management has proven themselves to be totally inept at seeing the long-term consequences of producing short-term gains based on foolish decisions.

The automakers' assets will not evaporate if they are allowed to go bankrupt. Someone will take possession of those assets and re-employ many of the people, but they will do so with a fresh, new vision about how to succeed in TODAY's economy, not the economy of the 50's nor the dream-world in which Ford, Chrysler and GM management have been living.

-- Richard D. Cushing

Bailout Parade Panic and the Benefits of Bankruptcy

Let's not allow Congress and members of the bailout parade panic us into allowing them to do things, as was done in the 1930s, that would convert a mild economic downturn into a true calamity. Right now the Big Three auto companies, and their unions, are asking Congress for a $25 billion bailout to avoid bankruptcy. Let's think about that a bit.

What happens when a company goes bankrupt? One thing that does not happen is their productive assets go poof and disappear into thin air. In other words, if GM goes bankrupt, the assembly lines, robots, buildings and other tools don't evaporate. What bankruptcy means is the title to those assets change. People who think they can manage those assets better purchase them.

Chapter 11 of the U.S. Bankruptcy Code, where the control of its business operations are subject to the oversight and jurisdiction of the court, gives companies a chance to reorganize. The court can permit complete or partial relief from the company's debts and its labor union contracts.

A large part of the problem is the Big Three's cozy relationship with the United Auto Workers union (UAW). GM has a $73 hourly wage cost including benefits and overtime. Toyota has five major assembly plants in the U.S. Its hourly wage cost plus benefits is $48. It doesn't take rocket science to figure out which company will be at a competitive disadvantage. Then there's the "jobs bank" feature of the UAW contract where workers who are laid off workers get 95 percent of their base pay and all their benefits. Right now there's a two-year limit but in the past workers could stay in the "jobs bank" forever unless they turned down two job offers within 50 miles of their factory. At one time job bank membership exceeded 7,000 "workers." GM, Ford and Chrysler face other problems that range from poor corporate management and marketing, not to mention costly government regulations.

Two vital marketplace signals are the profits that come with success and the losses that come with failure. When these two signals are not allowed to freely function, markets operate less efficiently. To be successful a business must take in enough revenue not only to cover wages, rents and interest but profits as well. In order to accomplish that feat executives must not only satisfy customers but they must do it in a manner that efficiently utilizes all of their resources. If they fail to cover costs, it means that resources are not being used efficiently and/or consumers don't value the good being produced relative to some other alternative. When a firm routinely fails to turn a profit, there are bankruptcy pressures. The firm's resources, workers, building and capital become available to someone else who might put them to better use. When government steps in with a bailout, it enables executives to continue mismanaging resources.

How much congressional involvement do we want with the Big Three auto companies? I'd say none. Congressmen and federal bureaucrats, including those at the Federal Reserve Board, don't know anymore about the automobile business than they know about the banking and financial businesses that they've turned into a mess. Just look at the idiotic focus of congressmen when the three auto company chief executives appeared before them. They questioned whether the executives should have driven to Congress rather than flown in on corporate jets. They focused on executive pay, which is a tiny fraction of costs compared to $73 hourly compensation to 250,000 autoworkers. The belief that Congress poses the major threat to our liberty and well-being is why the founders gave them limited enumerated powers. To our detriment, today's Americans have given them unlimited powers.

-- by Walter E. Williams

Found at: Capitalism Magazine (online)

Born in Philadelphia in 1936, Walter E. Williams holds a bachelor's degree in economics from California State University (1965) and a master's degree (1967) and doctorate (1972) in economics from the University of California at Los Angeles.

Chicago Sit-In, et al

The other day my wife showed me a blurb for a $250 short-course on "Constitutional Law" with the thought that I might be interested in taking it. I told her that I'd probably only be willing to pay for such a course if I were thinking about running for Congress in the next couple of years.

I later recanted because it is all too obvious that understanding the Constitution is not a prerequisite for serving in Congress. In fact, it appears that blatant disregard for Constitutional principles is becoming the key factor in getting elected and re-elected to federal Constitutional offices.

In the event our Congressmen and Senators have forgotten, we already have a federal program in place for dealing with the situation in Chicago (the sit-in by displaced workers in a failed company) and for the U.S. automakers. That program is called the "Bankruptcy Courts."

We don't need to have Congress and President-elect Obama using these situations as an excuse to drive forward with their Socialist agenda.

Call, write, or otherwise trouble your Senators and Representatives to let them know we do not want to become another failed attempt at Socialism. The free market and free enterprise work when given a chance.