Liberalism Needs to Separate From Leftism

America is moving towards disaster. Greece, which currently is in debt at 120% of its GDP, is set to collapse. We are at 101% and rising. Tough decisions must be made.

This is where traditional American, old school liberalism needs to reassert itself. American liberalism was not anti-industrial. As a matter of fact, they cringed at radical environmentalist proposals in the 1960s that feel far short of the Lisa Jackson EPA. They understood that labor needed industry in a basic way, but also needed help. Labor needed prosperous industry to employ workers and pay for pension and social programs.

At some point, liberals joined with leftists and therein lies the current problems.

Liberals understand that business needs to profit so that it can grow, employ more people, and pay its taxes. The Left sees business as a milk cow to be squeezed as much as possible, then whipped when it can provide no more milk.

The fact is that, given the knowledge that the United States can lead the world in energy production, including oil, we can pay for our social welfare system. We need to make tough decisions about federal spending on such things as education and we definitely need to cut waste. But, in reality, if we unleash American energy and manufacturing from its regulatory shackles, the resulting economic growth can pay for social welfare IF we do not start tacking on a whole bunch of new programs.

I don't mean gutting all environmental and labor laws. But we need to recognize that a balance must exist. We must stop discouraging development and begin encouraging growth.

To do so, the liberals need to reject the left and support energy and manufacturing growth. They need to stop bashing the productive simply because they exist and realize that if they are doing better, so is labor and so are the tax revenues that fund the programs that liberals love.

In other words, you cannot have it both ways. We cannot expand social benefits and discourage manufacturing and energy production at the same time.

Greece

It was either this or Herman Cain today. I happened to see Cain last night at the American Spectator dinner. He has a power and an eloquence in his public speaking and an easy going nature around his potential constituents. If you wonder how conservatives react to Cain now, he got a standing ovation after his introduction.

Unless the accusers have something more than inappropriate talk, Cain ain't going anywhere.

And now Greece.

2,400 years ago, Greece stood at the center of civilization. Persia's slow decline coupled with regional desire for olive oil and wine made the Greek cities wealthy. They traded their own, and other countries' products. However, their own tragic flaw lay in their inability to unify on anything. Their fratricidal wars left them vulnerable to the expansion of Rome.

Today, Greece stands at the abyss. Most of their country wants to stick its head in a hole and pretend that a welfare state is viable. Their debt is 120% of their GDP (ours is 101%, so we are not far behind) and they must pare away much of their welfare state and bureaucracy to qualify for a loan that will only pay their bills until the end of the year. An agreement was made, then rescinded as their prime minister agreed to put it to a national referendum, which is allowed under their legal system.

Where will Greece go from here? No one knows. The agreement will fail to win the vote, according to polls and observers. Had the prime minister gone ahead with the deal with the European Union, he risked civil war. If the country votes the plan down, there will still be massive social unrest, but the people can only blame themselves for that. However, if the vote passes, then it will give their government a mandate to make the reforms that they desperately need.

Greece's prime minister has gotten pummeled by the international press. But the spoiled brat populace of Greece gives him little choice

Jim DeMint (R-SC) Blasts Environmentalists Who Put Extremism Ahead of Public Safety

Recent Press Releases

November 1, 2011

54 Senators Risk Health of Millions to Appease Environmentalists on Inhaler Ban

WASHINGTON, D.C. Today, U.S. Senator Jim DeMint (R-South Carolina) made the following statement after the Senate voted 44-54against his amendment that would have stopped the U.S. Food and Drug Administration’s (FDA) ban on over-the-counter (OTC) epinephrine asthma inhalers. The amendment would have disallowed the use of taxpayer funds to enforce the ban on OTC inhalers. The ban is set to take effect in Jan. 1, 2012 and puts environmental concerns ahead of concerns for the estimated 3 million American asthma sufferers who use these inhalers.

“Fifty-four Senators voted to appease extreme environmentalists by banning inhalers that millions of Americans that depend on to breathe,” said Senator DeMint. “This ban won’t do anything serious to help the environment but it will force asthma suffers to spend two to three times more on prescription inhalers, leading many low-income Americans to seek less effective remedies. Even the EPA and FDA admit that banning OTC inhalers will do little to nothing to affect the ozone, but it could lead to hundreds of thousands of new asthma related hospital visits and hundreds of millions in new health costs.”

“This is exactly the kind of ridiculous regulation that shows why Americans are so fed up with the federal government’s nanny-state mentality. Once again, Washington is willing to put Americans at risk in the hopes of appeasing special interests.”

The FDA estimated that the inhaler ban may result in asthma sufferers self-medicating with less effective remedies, and could lead to an increase in annual health expenditures from $180 million to $1.1 billion and hospital ER visits for asthma could increase by anywhere from 0 to 444,000. (source: http://edocket.access.gpo.gov/2008/E8-27436.htm)

The ban is an attempt to reduce chlorofluorocarbon (CFC) emissions, yet even the FDA admits that “The reduction of CFC emissions associated with removing OTC epinephrine CFC MDIs [Metered-Dose Inhalers] from the U.S. market represents only a fraction of 1 percent of total global CFC emissions. Current allocations of CFCs for OTC epinephrine MDIs account for less than 0.1 percent of the total 1986 global production of CFCs.” (source: http://edocket.access.gpo.gov/2008/E8-27436.htm)

Federal Reserve Not Immune From Law of Unintended Consequences

Twist Puts Looney Tune Squeeze on Citizens

Federal Reserve Chairman Ben Bernanke recently announced that the Federal Open Market Committee (FOMC) would begin a process informally known as “Operation Twist,” in which the Federal Reserve will attempt to force long term rates downward while letting short term rates rise.

This will be accomplished by selling short term treasuries and purchasing longer term ones with those same funds. Bernanke believes that this will aid the economy by allowing individuals to refinance at lower rates, thereby providing support for real estate markets and yielding an increase in consumer spending money.

With this announcement, Mr. Bernanke has proven once more that elaborate theories crafted by geniuses always yield results even Wile E. Coyote himself could not devise a more promising scheme if left alone in the desert with stacks of economic data.

If by now you’re wincing just a bit, it could be because you know that reality comes with its own set of rules. Attempting to manipulate markets to achieve a desired outcome may appear logical…. it might even seem like the right thing to do on many occasions, but the law of unintended consequences always does exactly what you don’t expect, as its name implies.

Economic recovery in this environment is not unlike the Road Runner. Each time you think it can be had, it leaves you looking silly. What we need is an elaborate plan—or two…or even three.

The problem is that we have already made these attempts. First, there was QE1, then there was QE2. Both were extravagant and expensive ways to attempt economic stimulus. And now, because the first two were so successful, this third round of tinkering is being forced upon the public by a Fed Chairman concerned with his own job security.

First of all, we must consider those who depend the most upon a healthy and normal yield curve. Retirees, pensions, and small to regional banks depend more on long term rates to yield an acceptable rate of return than most other segments of society. Yet, Operation Twist is taking from those who have worked and saved, pressuring pension funds which are already stretched thin, and tilting the board to favor the megabanks which have far more diverse revenue streams – banks that have already been bailed out once.

In addition, only those people who qualify for refinancing will be able to benefit from these lower rates—if the bank is willing to lend at all—but those on the edge of walking away from their mortgages will see no reason to change their minds. As a result, real estate values will remain soft from the glut of homes on the market.

　

Mr. Bernanke (Wile E.), perhaps it is time to stop chasing Mr. Recovery (Road Runner). Retreat. Reconsider. Let supply and demand determine housing prices.

Perhaps some young couples starting out could benefit from a real break. If left alone, they will soon have saved enough money to do the things that move economies.

They could start a business and hire people. Perhaps their local bank would lend them money for commercial property if rates were attractive. Maybe Grandpa could have helped them out in a tight spot if his cash flow wasn’t restricted by a meddling little man in a far away place with a fancy title and wild ideas.

Henry Dillon is the Principal/Adviser with Founders Finance, LLC located in Huntington, WV. For further information, please visit their website at www.foundersfinance.com