Tuesday, July 31, 2012

Happy100th Birthday Milton Friedman!

Here are some of my favorite Milton Friedman quotes:

1. There is nothing as permanent as a temporary government program.

2. Inflation is always and everywhere a monetary phenomenon.

3. Inflation is caused by too much money chasing after too few goods.

4. Sloppy writing reflects sloppy thinking.

5. All learning is ultimately self-learning.

6. I'm in favor of legalizing drugs. According to my values system, if people want to kill themselves, they have every right to do so. Most of the harm that comes from drugs is because they are illegal.

7. Nobody spends somebody else's money as carefully as he spends his own. Nobody uses somebody else's resources as carefully as he uses his own. So if you want efficiency and effectiveness, if you want knowledge to be properly utilized, you have to do it through the means of private property.

8. The government solution to a problem is usually as bad as the problem.

9. The Great Depression, like most other periods of severe unemployment, was produced by government mismanagement rather than by any inherent instability of the private economy.

10. The high rate of unemployment among teenagers, and especially black teenagers, is both a scandal and a serious source of social unrest. Yet it is largely a result of minimum wage laws. We regard the minimum wage law as one of the most, if not the most, antiblack laws on the statute books.

11. Industrial progress, mechanical improvement, all of the great wonders of the modern era have meant relatively little to the wealthy. The rich in Ancient Greece would have benefited hardly at all from modern plumbing : running servants replaced running water. Television and radio? The Patricians of Rome could enjoy the leading musicians and actors in their home, could have the leading actors as domestic retainers. Ready-to-wear clothing, supermarkets - all these and many other modern developments would have added little to their life. The great achievements of Western Capitalism have redounded primarily to the benefit of the ordinary person. These achievements have made available to the masses conveniences and amenities that were previously the exclusive prerogative of the rich and powerful.

12. President Kennedy said, "Ask not what your country can do for you - ask what you can do for your country."... Neither half of that statement expresses a relation between the citizen and his government that is worthy of the ideals of free men in a free society. "What your country can do for you" implies that the government is the patron, the citizen the ward. "What you can do for your country" assumes that the government is the master, the citizen the servant.

13. On the difference between public vs. private education: "Try talking French with someone who studied it in public school. Then with a Berlitz graduate."

14. And what does reward virtue? You think the communist commissar rewards virtue? You think a Hitler rewards virtue? You think, excuse me, if you'll pardon me, American presidents reward virtue? Do they choose their appointees on the basis of the virtue of the people appointed or on the basis of their political clout?

15. Concentrated power is not rendered harmless by the good intentions of those who create it.

16. Hell hath no fury like a bureaucrat scorned.

17. I am favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it's possible.

18. Inflation is the one form of taxation that can be imposed without legislation.

19. Most economic fallacies derive from the tendency to assume that there is a fixed pie, that one party can gain only at the expense of another.

20. Many people want the government to protect the consumer. A much more urgent problem is to protect the consumer from the government.

21. Only government can take perfectly good paper, cover it with perfectly good ink and make the combination worthless.

22. One man's opportunism is another man's statesmanship.

Quote of the Day: Burton Malkiel

Look at 10-year Treasurys, which are now yielding—what?—1.39 percent and they seem to be going toward 1 percent. They’re down toward 1 percent in Germany and Holland and Japan. And for a retirement plan—not as a trader—thinking you're safe by including those as one of your long-term assets is crazy. They are going to prove to be very bad investments.

Let me just mention that the last time 10-year Treasurys yielded 1.4 percent in the United States was in 1946. We had a big debt—we had a debt-to-GDP ratio of 120 percent after World War II. To help finance the debt, we pegged interest rates at very low rates. This is what’s called financial repression. Interest rates were pegged until the early 1950s. They then rose only slowly. But people lost enormous amounts of money on bonds.

By 1980, we had a debt-to-GDP ratio of 30 percent. We solved the debt problem, but we solved it on the back of the bondholders. And I think that that’s exactly what’s going to happen in the United States and also in Europe. That’s why I’m very negative on bonds. We know equities aren't the greatest inflation hedge in the short run. But, in the long run, they are an inflation hedge. They do represent real assets. And I think equities are unusually attractive today. And, having said that, I will say that not only are multinationals attractive in the United States, but even though I'm pessimistic about European governments, a stock like Siemens—which is a sort of German General Electric—is a very attractive investment, particularly as the euro declines.

I’m generally bullish on equities, and bullish on equities in emerging markets because, again, valuations are very attractive. Before the crisis of 2008 emerging markets equities sold price-earnings multiples of 15 percentage points higher than price-earnings multiples in developed markets. And now they're 10 to 15 percentage points lower. So I think emerging markets are also extremely attractive.

~ Burton Malkiel, from Don’t Get Buried By Bonds

Sunday, July 29, 2012

I, Smartphone

The "I, Smartphone" video above is a modernized 21st century version of the classic essay "I, Pencil," written in 1958 by Leonard Reed, founder of the Foundation for Economic Education.

Wednesday, July 25, 2012

Tuesday, July 24, 2012

Is This Work of Art Worth $29.2 Million in Taxes?

Death Wealth taxes hit people in different ways.  Take the heirs of New York art dealer Ileana Sonnabend. The artwork pictured above is “Canyon,” a masterwork of 20th-century art created by Robert Rauschenberg that Mrs. Sonnabend’s children inherited when she died in 2007. Because the work, a sculptural combine, includes a stuffed bald eagle, a bird under federal protection, the heirs would be committing a felony if they ever tried to sell it. So their appraisers have valued the work at zero. But the Internal Revenue Service takes a different view. It has appraised “Canyon” at $65 million and is demanding that the owners pay $29.2 million in taxes. Although they can’t sell the work for even a penny, the heirs have to come up with nearly $30 million. It would at least ease the financial pain to donate the piece and take a deduction, except... given their income and the limits on deductions, [their lawyer, Ralph Lerner] said, they would be able to deduct only a small part of the work’s value each year. Mr. Lerner estimated that it would take about 75 years for them to absorb the deduction. By then they would be long gone from this earth, and their heirs would be grappling with the same wealth confiscation taxes that they are now dealing with. There is an awful lot of greed and envy in the world, and not just in the private sector.

Cartoon of the Day: Hard Work

Sunday, July 22, 2012

The Warren Buffett Taste Test

Time to buy Dr. Pepper Snapple Group (DPS)?

Picture of the Day: Fidel

The Revolution is doing great! Keep up the struggle, keep working, keep moving forward!

~ Fidel

Grouch: Notice the abundance and prosperity that surrounds the revolution.

Thursday, July 19, 2012

Cartoon of the Day: Crony Capitalism

Time to start shutting off the spigot.

How to Create Green Jobs -- What Legislator Can Say No to Creating Jobs

First, our excavation specialists insert their shovels into the ground and remove the soil. This presents the problem of an existing hole in the earth, creating a dangerous situation that could lead to hazards, including but not limited to tripping, falling, and bodily injuries.
Then there is the renewal process. At Earth Supply, we train professional backfillers to renew the soil in place of the existing hole, restoring the earth to its original condition.
Some folks say we’re just digging ditches and filling them back up again. But it’s about more than that. It’s about jobs.

O’Keefe’s Project Veritas takes this sales pitch and his newly-created non-existent company – a company dedicated to digging and filling holes – and asks for help from local union bosses to move subsidies for Earth Supply and Renewal through legislatures. After all, they argue, even if we’re just digging ditches and refilling them on the taxpayer dime, at least we’re creating jobs for new union workers.

Google Street View of Antarctica

Both Scott’s and Shackleton’s huts have been preserved intact as historical sites by New Zealand’s Antarctic Heritage Trust. The explorers’ tools and supplies, in their original arrangement, are on full display in detailed panoramic images of the huts’ interiors—a departure from the typical exterior perspectives of Street View. Also viewable in the Antarctic series of views is the Cape Royds Adelie Penguin Rookery, the world’s southernmost penguin colony and home to many thousands of Adelie penguins. Like all Street View images, including the Scott and Shackleton huts, the Rookery views are static—images of bygone moments frozen in time—but they are no less breathtaking for it.

Tuesday, July 17, 2012

Quote of the Day: Benjamin Franklin

I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it. In my youth I travelled much, and I observed in different countries, that the more public provisions were made for the poor, the less they provided for themselves, and of course became poorer. And, on the contrary, the less was done for them, the more they did for themselves, and became richer. There is no country in the world where so many provisions are established for them; so many hospitals to receive them when they are sick or lame, founded and maintained by voluntary charities; so many alms-houses for the aged of both sexes, together with a solemn general law made by the rich to subject their estates to a heavy tax for the support of the poor. Under all these obligations, are our poor modest, humble, and thankful; and do they use their best endeavours to maintain themselves, and lighten our shoulders of this burthen? — On the contrary, I affirm that there is no country in the world in which the poor are more idle, dissolute, drunken, and insolent. The day you passed that act, you took away from before their eyes the greatest of all inducements to industry, frugality, and sobriety, by giving them a dependance on somewhat else than a careful accumulation during youth and health, for support in age or sickness. In short, you offered a premium for the encouragement of idleness, and you should not now wonder that it has had its effect in the increase of poverty.

~ Benjamin Franklin, 1766

Sunday, July 15, 2012

Cartoon of the Day: Keynesian Economics

Sunday Verse: Ray Bradbury


And this is where we went, I thought,
Now here, now there, upon the grass
Some forty years ago.
I had returned and walked along the streets
And saw the house where I was born
And grown and had my endless days.
The days being short now, simply I had come
To gaze and look and stare upon
The thought of that once endless maze of afternoons.
But most of all I wished to find the places where I ran
As dogs do run before or after boys,
The paths put down by Indians or brothers wise and swift
Pretending at a tribe.
I came to the ravine.
I half slid down the path
A man with graying hair but seeming supple thoughts
And saw the place was empty.
Fools! I thought. O, boys of this new year,
Why don’t you know the Abyss waits you here?
Ravines are special fine and lovely green
And secretive and wandering with apes and thugs
And bandit bees that steal from flowers to give to trees.
Caves echo here and creeks for wading after loot:
A water-strider, crayfish, precious stone
Or long-lost rubber boot --
It is a natural treasure-house, so why the silent place?
What’s happened to our boys that they no longer race
And stand them still to contemplate Christ’s handiwork:
His clear blood bled in syrups from the lovely wounded trees?
Why only bees and blackbird winds and bending grass?
No matter. Walk. Walk, look, and sweet recall.

I came upon an oak where once when I was twelve
I had climbed up and screamed for Skip to get me down.
It was a thousand miles to earth. I shut my eyes and yelled.
My brother, richly compelled to mirth, gave shouts of laughter
And scaled up to rescue me.
"What were you doing there?" he said.
I did not tell. Rather drop me dead.
But I was there to place a note within a squirrel nest
On which I’d written some old secret thing now long forgot.
Now in the green ravine of middle years I stood
Beneath that tree. Why, why, I thought, my God,
It’s not so high. Why did I shriek?
It can’t be more than fifteen feet above. I’ll climb it handily.
And did.
And squatted like an aging ape alone and thanking God
That no one saw this ancient man at antics
Clutched grotesquely to the bole.
But then, ah God, what awe.
The squirrel’s hole and long-lost nest were there.

I lay upon the limb a long while, thinking.
I drank in all the leaves and clouds and weathers
Going by as mindless
As the days.
What, what, what if? I thought. But no. Some forty years beyond!
The note I’d put? It’s surely stolen off by now.
A boy or screech-owl’s pilfered, read, and tattered it.
It’s scattered to the lake like pollen, chestnut leaf
Or smoke of dandelion that breaks along the wind of time...

No. No.

I put my hand into the nest. I dug my fingers deep.
Nothing. And still more nothing. Yet digging further
I brought forth:
The note.
Like mothwings neatly powdered on themselves, and folded close
It had survived. No rains had touched, no sunlight bleached
Its stuff. It lay upon my palm. I knew its look:
Ruled paper from an old Sioux Indian Head scribble writing book.
What, what, oh, what had I put there in words
So many years ago?
I opened it. For now I had to know.
I opened it, and wept. I clung then to the tree
And let the tears flow out and down my chin.
Dear boy, strange child, who must have known the years
And reckoned time and smelled sweet death from flowers
In the far churchyard.
It was a message to the future, to myself.
Knowing one day I must arrive, come, seek, return.
From the young one to the old. From the me that was small
And fresh to the me that was large and no longer new.
What did it say that made me weep?

I remember you.
I remember you.

~ Ray Bradbury

Saturday, July 14, 2012

Am I Taxed Enough?

I did some back of the envelope calculations recently to estimate what percentage of my income is paid to government in the form of taxes and fees.  Here's what I came up with:

Federal Income Tax:                             28%
Social Security Tax:                               6.2% normally, 4.5% in 2012
Medicare Tax:                                       1.45%
State Income Tax:                                  6%
Property Tax:                                        2.5%
State Sales Tax                                      1%
State and Federal Gasoline Taxes          1%
Misc. Fees and Taxes                               .5%

I do live in the People's Republic of Maryland-- state motto: "If you can dream it, we can tax it." The Governor and State Legislators are trying their darnedest to turn Maryland into California or Illinois, and drive all of its productive citizens to more tax-friendly places.  I have a middle class income, nothing extravagant for the DC suburbs, so I ask you does government in the aggregate deserve 47% of anyone's wages, regardless of income level? Is it that taxpayers are not paying their fair share, or that government just grows greedier and greedier each year?  Once Obamacare kicks in, I expect my overall tax rate to approach 50%.  My incentive to earn that more money will be greatly reduced, because if I'm pushed into the next higher income bracket the government will be getting more than 50% of what I earn.  And I'll be damned if I am going to hand over more than 50% of my earnings to bureaucrats to fritter away on pet projects to enrich their cronies and buy votes to get themselves reelected.

Quote of the Day: Bruce Bartlett

In conclusion, the fall of Rome was fundamentally due to economic deterioration resulting from excessive taxation, inflation, and over-regulation. Higher and higher taxes failed to raise additional revenues because wealthier taxpayers could evade such taxes while the middle class--and its taxpaying capacity--were exterminated. Although the final demise of the Roman Empire in the West (its Eastern half continued on as the Byzantine Empire) was an event of great historical importance, for most Romans it was a relief.

~ Bruce Bartlett, from How Excessive Government Killed Ancient Rome

Thursday, July 12, 2012

Quote of the Day: Frank Shostak

A fall in interest rates cannot grow the economy. All that it can produce is a misallocation of real savings. As a rule, an artificial lowering of interest rates (which is accompanied by the central bank’s monetary pumping — increasing commercial banks’ reserves) boosts the demand for lending; and this, as a rule, causes banks to expand credit "out of thin air."

~ Frank Shostak, from Yet Another Operation Twist

Grouch: Will Operation Twist succeed on the third try? Or are our economic problems deeper and more systemic than anything the Fed could ever manipulate our way out of? Are artificially low interest rates and current fiscal policy actually retarding a normal recovery?

Tuesday, July 10, 2012

How to Make a Big Mac at Home

If you still think the recipe for McDonald's Big Mac is a secret, think again.
A video posted last month on McDonald's Canadian YouTube channel shows executive chef Dan Coudreaut dishing out the ingredients for the fast food giant's iconic burger. Once you know how to make the secret sauce, the rest is easy-- two all-beef patties, not-so special sauce, lettuce, cheese, pickles, onions - all on a sesame seed bun.

Here's the list of ingredients for the sauce:

  • Mayo
  • Sweet pickle relish
  • Yellow mustard
  • White wine vinegar
  • Garlic powder
  • Onion powder
  • Paprika

Krugman vs the Austrian School's Schwartz

Unless you are a Spanish speaker, skip the intro and pick up Krugman's lecture at 9:19. Professor Pedro Schwartz responds to Krugman’s comments in excellent English at 35:25.

"Keynesians got us into this mess and now we (non-Keynesians) have to sacrifice our principals so that they can get us out of this mess."

~ Pedro Schwartz

Monday, July 9, 2012

A Short History of Rock n Roll Riffs

Some are pretty good, some are so-so. Most won't be remembered 50 years from now, but still it's some cheap entertainment for the moment.

Quote of the Day: Iowahawk

Jubilant scientists at the DNC’s High Speed Word Collider (HSWC) announced today they have conclusively disproven the existence of Roberts’ Taxon, the theoretical radioactive Facton particle that some had worried would lead to the implosion of the entire Universal Health Care System.

“I think it’s time to pop the champagne corks,” said HSWC Director David Plouffe. “Then blaze some choom.”

The landmark experiment in Quantum Rhetoric began early this week after legal particle cosmologist John Roberts published a paper in the Quarterly Journal of Tortured Logic that solved the long-debated Pelosi’s Paradox in Universal Health Care Theory.

“Pelosi’s Paradox states that in order to find out what is in a health care bill, it would have to be passed,” explained physicist Steven Hawking. “But in order to be a law it would have to be constitutional, which means someone would have to know what was in it, which would mean it couldn’t have been a bill in the first place. Think of Schroedinger’s Cat, except with a lobotomy.”

To solve the paradox, Roberts proposed the existence of the Taxon – an ephemeral, mysterious facton particle that in theory would allow the Universal Health System to be constitutional, without directly observing what was in it. DNC scientists at first cheered Roberts’ findings, but it soon came apparent that it opened an even deadlier dilemma.

“If Roberts’ Taxon were really to exist, and was woven throughout the Health-Government-Time continuum, the merest realization of it would create a giant black hole in Gallup Space and cause free healthcare reality to collapse upon itself,” said Plouffe.

In order to disprove the Taxon, scientists at the HSWC devised a test experiment in their enormous CarneyLab bullshit accelerator. This test involved speeding a small mass of Facton – theoretically containing Roberts’ Taxon – and smashing it at near-light speed against a flaming super-dense ionized clod of purified bullshit.

~ Iowahawk

Saturday, July 7, 2012

Quote of the Day: Keith Olbermann

“Journalists say a thing they know isn’t true, in the hope that if they say it long enough it will be true.”

~ Keith Olbermann

Grouch: What's the difference between journalists and commentators? At most networks there is no difference.

Thursday, July 5, 2012

Higgs Boson Explained

Ever since the Large Hadron Collider (LHC) went online in 2008, physicists have been conducting experiments, hoping to finally prove or disprove the existence of The God Particle, otherwise known as the Higgs Boson. Today, researchers working at CERN (which operates the LHC) announced that they think they’ve finally found it.

The Meaning of Independence Day

I'm a day late with this post, but every now and then it is good to imagine what life would have been like if we had been alive in 1776 and put our necks on the line to fight for our freedom and independence.  In the immortal words of Jefferson and others:

The unanimous Declaration of the thirteen united States of America

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. — Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.

He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only.

He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their Public Records, for the sole purpose of fatiguing them into compliance with his measures.

He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.

He has refused for a long time, after such dissolutions, to cause others to be elected, whereby the Legislative Powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.

He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.

He has obstructed the Administration of Justice by refusing his Assent to Laws for establishing Judiciary Powers.

He has made Judges dependent on his Will alone for the tenure of their offices, and the amount and payment of their salaries.

He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.

He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.

He has affected to render the Military independent of and superior to the Civil Power.

He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:

For quartering large bodies of armed troops among us:

For protecting them, by a mock Trial from punishment for any Murders which they should commit on the Inhabitants of these States:

For cutting off our Trade with all parts of the world:

For imposing Taxes on us without our Consent:

For depriving us in many cases, of the benefit of Trial by Jury:

For transporting us beyond Seas to be tried for pretended offences:

For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies

For taking away our Charters, abolishing our most valuable Laws and altering fundamentally the Forms of our Governments:

For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.

He has abdicated Government here, by declaring us out of his Protection and waging War against us.

He has plundered our seas, ravaged our coasts, burnt our towns, and destroyed the lives of our people.

He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation, and tyranny, already begun with circumstances of Cruelty & Perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.

He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands.

He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince, whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.

Nor have We been wanting in attentions to our British brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.

We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these united Colonies are, and of Right ought to be Free and Independent States, that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do. — And for the support of this Declaration, with a firm reliance on the protection of Divine Providence, we mutually pledge to each other our Lives, our Fortunes, and our sacred Honor.

Tuesday, July 3, 2012

Where the Jobs Are

How did I miss out on this opportunity?  To serve my country and administer environmental justice, what could be sweeter?  Not to mention the salary and perks, and the generous retirement program.  But what the heck is environmental justice and why are the taxpayers paying for it?  The position sounds like something out of the book 1984.  The EPA defines it as:
the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies. EPA has this goal for all communities and persons across this Nation [sic]. It will be achieved when everyone enjoys the same degree of protection from environmental and health hazards and equal access to the decision-making process to have a healthy environment in which to live, learn, and work.
Call me naive, but isn't it the mission of the Department of Justice to make sure the laws of the nation are enforced in a non-discriminatory manner? Why do we need redundant government bureaucracies proliferating like rabbits when we are borrowing 40 cents of every federal dollar spent? This Directorate seems like a good place to begin trimming back government. I'm sure there are countless other opportunities being overlook by those who can't find a penny to cut out of a $4 Trillion dollar budget.

YTD Performance of Diversified Portfolio at the End of 2nd Quarter

At the end of the 2nd quarter, our diversified sample portfolio returned 6.04% so far for the year. This represents a 2.5% decline for the quarter. Given the volatility and general economic uncertain both in the US and abroad, investors should be satisfied with this level of return in a moderate risk portfolio.

Monday, July 2, 2012

How China is Really Governed

This excellent documentary from the WSJ covers the Bo Xilai scandal that has shaken the Communist Party and China's ruling class. This video provides a glimpse into how China is really governed, and is closely resembling the former Ming and Qing Dynasties where palace intrigue and favoritism were the rule.

The Surreal Constitution

Several days have passed since the Supreme Court ruling on Obmamacare. The passage of time has not mellowed this decision--- it still stinks to high heaven. To think that the Chief Justice of the Supreme Court would violate his oath of office--- "I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter"--- and succumb to political pressure is truly repugnant and inexcusable. To add insult to injury, the twisted logic of the decision has set a precedent for future governmental abuses of its citizens. I would paraphrase Roberts reasoning as follows:

All citizens are free not to eat broccoli, but very inaction of not purchasing broccoli will trigger a penalty from the IRS who is monitoring your lack of broccoli purchases. But let's get creative for a moment and not call this a penalty, even though the statue calls it a penalty and numerous administration officials from the President on down insist that it is penalty not a tax, let's call this a tax, and as everyone knows Congress has the power to tax you for not eating broccoli. Therefore, now that the Court is pretending a penalty is a tax the statute must be Constitutional.

This is classic legislating from the bench, not interpreting the law as written.

The minority justices have applied the law correctly in their dissent:
Our cases establish a clear line between a tax and a penalty: “[A] tax is an enforced contribution to provide for the support of government; a penalty … is an exaction imposed by statute as punishment for an unlawful act.” United States v. Reorganized CF&I Fabricators of Utah, Inc., 518 U. S. 213, 224 (1996) (quoting United States v. La Franca, 282 U. S. 568, 572 (1931)). In a few cases, this Court has held that a “tax” imposed upon private conduct was so onerous as to be in effect a penalty. But we have never held—never—that a penalty imposed for violation of the law was so trivial as to be in effect a tax. We have never held that any exaction imposed for violation of the law is an exercise of Congress’ taxing power—even when the statute calls it a tax, much less when (as here) the statute repeatedly calls it a penalty.

The supreme irony of this decision is that Justice Roberts in succumbing to the political pressure not to delegitimize the Court has in fact delegitimized both himself and the Court by compromising the Court's integrity. This ruling is destined to go down in history along side Wickard v. Filburn and Dred Scott v. Sandford as one of the worst decisions in the history of the Court. Shame on you Justice Roberts.

Happy 5th Birthday iPhone

Grouch: No Apple products in my house, but you have to salute their obessive commitment to their vision of perfection. Their price premium outweighs the benefits in my opinion. There are cheaper options to get roughly the same functionality. You just have to do some research and be willing to dig a little big to figure out what those options are.