Regulatory Trends in the Bush Years

http://www.heritage.org/Research/Reports/2008/03/Red-Tape-Rising-Regulatory-Trends-in-the-Bush-Years

Despite the claims of critics-and some supporters-of the Bush Administration, net regulatory burdens have increased in the years since George W. Bush assumed the presidency. Since 2001, the federal government has imposed almost $30 billion in new regulatory costs on Americans. About $11 billion was imposed in fiscal year (FY) 2007 alone.

Critics of Bush Administration regulatory policy have argued that budget cuts are evidence that restric­tions are being loosened. Yet according to an analy­sis by George Mason University's Mercatus Center and Washington University's Weidenbaum Center, appropriations for federal regulatory agencies have increased during the Bush years from $27 billion in FY 2001 to $44.9 billion in FY 2007-a 44 percent increase in inflation-adjusted dollars.[12] The total staffing of regulatory agencies went up nearly as much, from 172,000 employees to over 244,000- a 41 percent increase.

During the first seven years of the Bush presi­dency, 98 such major rules were promulgated by federal agencies. Of those, 75 (more than 10 per year) increased regulatory burdens on Americans. This is significantly less than the rate during the Clinton Administration, which adopted major increases in regulation at a rate of some 19 times per year from 1997 to early 2001.[19]

Although the Bush Administration imposed fewer new burdens on Americans, the total regulatory bur­den continued to increase in absolute terms. Com­pared to the 74 rule changes that increased regulatory costs, only 23 rule changes reduced burdens. In other words, for every case in which regulators reduced a burden, they increased burdens over three times.

Why Government Spending Does Not Stimulate Economic Growth

http://www.heritage.org/Research/Economy/bg2354.cfm

• The fact that government failed to spend its way to prosperity is not an isolated incident:
• During the 1930s, New Deal lawmakers doubled federal spending--yet unemployment remained above 20 percent until World War II.
• Japan responded to a 1990 recession by passing 10 stimulus spending bills over 8 years (building the largest national debt in the industrialized world)--yet its economy remained stagnant.
• In 2001, President Bush responded to a recession by "injecting" tax rebates into the economy. The economy did not respond until two years later, when tax rate reductions were implemented.
• In 2008, President Bush tried to head off the current recession with another round of tax rebates. The recession continued to worsen.
• Now, the most recent $787 billion stimulus bill was intended to keep the unemployment rate from exceeding 8 percent. In November, it topped 10 percent.[2]

Congress cannot create new purchasing power out of thin air. If it funds new spending with taxes, it is simply redistributing existing purchasing power (while decreasing incentives to produce income and output). If Congress instead borrows the money from domestic investors, those investors will have that much less to invest or to spend in the private economy. If they borrow the money from foreigners, the balance of payments will adjust by equally raising net imports, leaving total demand and output unchanged. Every dollar Congress spends must first come from somewhere else.

Removing water from one end of a swimming pool and pouring it in the other end will not raise the overall water level. Similarly, taking dollars from one part of the economy and distributing it to another part of the economy will not expand the economy.

But savings do not drop out of the economy. Nearly all people put their savings in: (1) banks, which quickly lend the money to others to spend; (2) investments in stocks and bonds; or (3) personal debt reduction. In each of these situations, the financial system transfers one person's savings to someone else who can spend it. So all money is quickly spent regardless of whether it was initially consumed or saved. The only savings that drop out of the economy are those hoarded in mattresses and safes.

Accepting that domestic borrowing is no free lunch, some analysts have asserted that foreign borrowing can inject new dollars into the economy. However, these nations must acquire American dollars before they can lend them back to Washington. Foreign countries can acquire American dollars by either:

• Attracting American investments in their country. In that instance, the dollars leaving America match the dollars lent back to America. The net flow of saving circulating through the U.S. economy does not increase.
• Selling goods and services to Americans and receiving American dollars in return. For the United States, these imports raise the trade deficit and thus reduce domestic demand. The government's subsequent borrowing back and spending of these dollars merely offsets the increased trade deficit.

In either situation, American dollars must first leave the country before they can be lent back into the U.S. economy. The balance of payments between America and other nations must net zero. Consequently, government spending funded from foreign borrowing does not provide stimulus.

Thus, not all tax cuts are created equal. The economic impact of a tax cut depends on how much it alters behavior to encourage labor supply or productivity. This productivity standard is the same as the one applied to government spending in the previous section.
Tax rebates fail to increase economic growth because they are not associated with productivity or work effort. No new income is created because no one is required to work, save, or invest more in order to receive a rebate. In that sense, rebates that write each American a check are economically indistinguishable from government spending programs. In fact, the federal government treats rebate checks as a "social benefit payment to persons."[20] They represent another feeble attempt at creating new purchasing power out of thin air rather than focusing on productivity.

Tax rebates in 1975, 2001, and 2008 all failed to create economic growth. By contrast, large reductions in marginal tax rates in the 1920s, 1960s, and 1980s were each followed by large surges in economic growth.[21] More recently, the 2003 tax-rate reductions immediately reversed the job losses, sinking stock market, declining business investment, and sluggish economic growth rates that had followed the 2000 recession.[22] These gains continued until unrelated economic developments brought the most recent recession in December 2007.[23]

Obama to Nationalize Student Lending with Pending Budget Bill

http://cnsnews.com/news/article/60074

A bill currently before the Senate would empower the Obama administration to nationalize the student lending industry, eliminating the federally subsidized private loans millions of university students rely on to finance their educations.

Under the current system, the federal government subsidizes private financial institutions in order to entice those institutions to provide low-interest loans to students.

Under this arrangement the government sets the interest rates lenders may charge students. In return, the government reimburses lenders if market interest rates rise above the interest rates on the loans – in essence, the government reimburses private lenders if they begin losing money on the loans.

In return, the lenders agree to return any windfall profits made from the loans to the government. In other words, if market interest rates fall below the interest rates of the loans, the lenders pay the government the difference.

The government also agrees to reimburse the lenders should a student default.

Under the system proposed by Obama, the government would cut private lenders out of the picture entirely, setting the interest rates and collecting payments directly for all student lending.

Whether or not the government saw a profit or a loss from the new, federal loans would depend on the rate at which the government borrows money. For instance, the law currently sets the interest rate for direct loans at a maximum of 6.8 percent.

Under Obama’s proposal, if the government can borrow money at a rate lower than 6.8 percent, it would realize the difference as profit. If the government’s borrowing rate were to fall in the future, its profit on student loans would grow.

The idea to nationalize student lending was first put forth in President Obama’s fiscal-year 2010 budget and marketed as a way to save the government billions of dollars. According to a CBO estimate, the proposal would save the government $87 billion over 10 years.

The savings estimate results from the fact that the government believes it will collect more in interest payments from students than it would otherwise have to pay in fees to lenders.

How Poor Are America's Poor? Examining the "Plague" of Poverty in America

http://www.heritage.org/Research/Welfare/bg2064.cfm

The following are facts about persons defined as "poor" by the Census Bureau, taken from various government reports:

• Forty-three percent of all poor households actually own their own homes.
• The average home owned by persons classified as poor by the Census Bureau is a three-bedroom house with one-and-a-half baths, a garage, and a porch or patio.
• Eighty percent of poor households have air conditioning. By contrast, in 1970, only 36 percent of the entire U.S. population enjoyed air conditioning.
• Only 6 percent of poor households are overcrowded. More than two-thirds have more than two rooms per person.
• The average poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe. (These comparisons are to the average citizens in foreign countries, not to those classified as poor.)
• Nearly three-quarters of poor households own a car; 31 percent own two or more cars.
  Ninety-seven percent of poor households have a color television; over half own two or more color televisions.
• Seventy-eight percent have a VCR or DVD player; 62 percent have cable or satellite TV reception.
• Eighty-nine percent own microwave ovens, more than half have a stereo, and more than a third have an automatic dishwasher.
  

As a group, America's poor are far from being chronically undernourished. The average consumption of protein, vitamins, and minerals is virtually the same for poor and middle-class children and, in most cases, is well above recommended norms. Poor children actually consume more meat than do higher-income children and have average protein intakes 100 percent above recommended levels. Most poor children today are, in fact, supernourished and grow up to be, on average, one inch taller and 10 pounds heavier than the GIs who stormed the beaches of Normandy in World War II.

While the poor are generally well nourished, some poor families do experience temporary food shortages. But even this condition is relatively rare; 89 percent of the poor report their families have "enough" food to eat, while only 2 percent say they "often" do not have enough to eat.

Overall, the typical American defined as poor by the government has a car, air conditioning, a refrigerator, a stove, a clothes washer and dryer, and a microwave. He has two color televisions, cable or satellite TV reception, a VCR or DVD player, and a stereo. He is able to obtain medical care. His home is in good repair and is not overcrowded. By his own report, his family is not hungry and he had sufficient funds in the past year to meet his family's essential needs. While this individual's life is not opulent, it is equally far from the popular images of dire poverty conveyed by the press, liberal activists, and politicians.

Is it all just a Ponzi Scheme?

http://www.sprott.com/Docs/MarketsataGlance/12_2009_MAAG.pdf

...to summarize, the majority buyers of Treasury securities in 2009 were:
1. Foreign and International buyers who purchased $697.5 billion.
2. The Federal Reserve who bought $286 billion.
3. The Household Sector who bought $528 billion to Q3 – which puts them on track
purchase $704 billion for fiscal 2009.

These three buying groups represent the lion’s share of the $1.885 trillion of debt that was issued by the US in fi scal 2009. We must admit that we were surprised to discover that “Households” had bought so many Treasuries in 2009. They bought 35 times more government debt than they did in 2008. Given the financial condition of the average household in 2009, this makes little sense to us. With unemployment and foreclosures skyrocketing, who could afford to increase treasury investments to such a large degree?

Amazingly, we discovered that the Household Sector is actually just a catch-all category. It represents the buyers left over who can’t be slotted into the other group headings. For most categories of financial assets and liabilities, the values for the Household Sector are calculated as residuals.

The On-Again, Off-Again Depression

http://dailyreckoning.com/the-on-again-off-again-depression/
By Bill Bonner

The US stock market is still in “bounce mode.” All bounces come to an unhappy end. This will be no exception.

If you step back a bit further, you could see it in a different light. Ten years ago, The Daily Reckoning warned of a long, Japan-like slump. Then, the stock market fell and the economy went into a recession. But the downturn didn’t last long. And in the bubbly years that followed, our alert was quickly forgotten – especially by us! But now, 10 years have gone by. The S&P 500 has lost 20% of its value during that period. Wages and income are static. And there is not one single more job in America than there was then. It was a “Lost Decade” for the American economy.

So get ready…

How about a depression that lasts for 20 years? It could be on its way.

In December, exactly 20 years ago, Japan’s stocks closed at an epic high – 38,957 for the Nikkei 25 index. Last week, that same index closed at 9,977.

Readers will quickly note that the Japanese are idiots. Why else would they allow a 20-year bear market? Why else would they permit their economy to slide sideways for nearly an entire generation?

Where is the Japanese Bernanke?

This is almost the same question we posed readers 10 years go. Except then, we asked: Where is the Japanese Greenspan?

Greenspan…Bernanke…it didn’t seem to make any difference. American central bankers seemed to have magical powers, at least compared to their Japanese counterparts. They seemed able to succeed where the Japanese failed…

American economists mocked the Japanese 10 years ago. But what goes around, comes around…
Japanese and American economists go to the same schools. They have the same silly ideas. They are equally incompetent, as near as we can see. And yet, the Japanese have suffered one ‘lost decade’…and then another…while Americans went from bubble to bubble….

But, maybe our first idea was right after all. After we warned that the country could follow on Japan’s heels…entering a long, soft, slow depression…the Greenspan Fed and the Bush federal government opened up with all cannons. They blasted away on both fiscal and monetary fronts…ending up with the biggest barrage of stimulus the world had ever seen.

And what happened? They inflated another bubble…bigger and more dangerous than any before it.

Now, that bubble too has blown up. And now we look around. Once again, the Bernanke/Obama team is firing every gun; just as the Greenspan/Bush team did in the early 2000s…only more of them. But this time, the volleys are not having the same effect. Even though asset markets are bubbling up as hoped, the depression won’t go away. Unemployment is over 10% and still increasing. This is not another “jobless recovery” like the one in 2002-2003. This is no recovery at all.

Then, we look back at the last 10 years. What do we see? Instead of making economic progress, we see a nation making economic mistakes. And, under the leadership of the Obama/Bernanke/Geithner team…they’re still making mistakes. The same mistakes. Only bigger ones. And so we have to wonder…

Maybe the next decade will be ‘lost’ too. Stocks have gone nowhere for the last 10 years, but they are still expensive. On average, they sell for 50% more than the long-term average P/E. Usually, when they are this high, the next generation produces piddly gains. Could it be that, 10 years from now, we will look back without having added a single dollar of net return? Yes…it is quite possible. Likely even. That will mean a total of 20 years with no profit for stock market investors.

Which would serve them right. You’ll recall, perhaps, that at the end of the ’90s it was widely advertised that the surest, simplest road to riches was the stock market. The Dow was supposed to go to 36,000, according to one well-publicized forecast. All you had to do was ‘buy and hold.’ You’d get rich for sure.

Of course, it doesn’t work that way. As soon as investors all come to think the same thing the only sure thing is that what they all think is balderdash.
Well…then…what do they think now?

As near as we can see they believe two contradictory things. On the one hand, everyone says the dollar is doomed. On the other hand, they all seem to want dollar-denominated US Treasury bonds.

But actions speak louder than words. They may talk about the end of the dollar; but that is what they still own. And that is what they’re still buying – via US Treasuries. So…we want to be short US Treasuries for the next 10 to 20 years.

But wait. Isn’t it too soon? Ah, there’s the rub. Treasuries seem to be approaching a major peak. Maybe they are there already. Maybe they aren’t.

“What bothers me is that we still haven’t had that other major leg down in the stock market,” we told colleagues Issy Bacher and Dan Denning today. “It’s not natural for a bear to take a chunk out of asset prices…and then just go away. Typically, the assets bounce back…and then the bear takes another chunk out of them.

“Since we haven’t had that next leg down…we have to assume it’s still ahead. But investors seem totally unprepared for it. When it comes, they’re going to panic. They’re going to sell shares all over the world. And they’re going to seek safety…where? They’re probably going to turn to US Treasury bonds. Treasuries will go up, not down…

“Now the funny thing is that moving to Treasury bonds will help the US government finance its deficits…and possibly stretch out the depression for years. As long as the dollar is in jeopardy, the feds are in danger. They might not be able to finance their deficits. Which means, foreigners…and investors generally…could walk away from the dollar at any time. That would cause a major crisis. If the feds couldn’t finance the deficit with borrowed money…they’d be forced to print it…causing hyperinflation.

“As long as they can finance it, on the other hand…we could face a long depression.
“That’s the risk that no one is paying attention to…and no one is prepared for. That’s why it seems like the most likely outcome. A long, slow, on-again, off-again depression…just like we forecast 10 years ago.”

House Panel Passes College Football Playoff Bill

http://apnews.myway.com/article/20091209/D9CFVTR01.html

A House subcommittee approved legislation Wednesday aimed at forcing college football to switch to a playoff system to determine its national champion, over the objections of some lawmakers who said Congress has meatier targets to tackle.

The bill, which faces steep odds, would ban the promotion of a postseason NCAA Division I Football Bowl Subdivision game as a national championship unless it results from a playoff.

Why don't we just shread the Constitution while we are at it?

Pelosi Endorses ‘Global’ Tax on Stocks, Bonds, and other Financial Transactions

http://www.cnsnews.com/news/article/58099

House Speaker Nancy Pelosi (D-Calif.) endorsed the idea of a “global” tax on stock trades and other financial transactions, saying the estimated $150 billion in annual revenue from such a tax could be used to help fund more stimulus spending.

“I think there would be a market for it among the American people to say that we are all participating in the economic prosperity of our country, and we are all pitching in to continue that prosperity,” said Pelosi.

What a socialist idea. Since when is it my job to contribute to the economic prosperity of our country? That's not my duty as a citizen, nor should it be. She has it completely backwards. You don't force people to be stewards of their country, because people don't want to do that. They want to take care of themselves and their own. The best way to allow them to do that is for the government to get out of the way. The end result is that by individuals pursuing their own selfish interest, the economy as a whole benefits because it is a positive sum game. When you take from one and give it to another, as she calls it: chipping in, it's a zero sum game because one has to lose in order for another to gain.

Wave of Debt Payments Facing US Government

http://www.cnbc.com/id/34104722

Treasury officials now face a trifecta of headaches: a mountain of new debt, a balloon of short-term borrowings that come due in the months ahead, and interest rates that are sure to climb back to normal as soon as the Federal Reserve decides that the emergency has passed.

In concrete terms, an additional $500 billion a year in interest expense would total more than the combined federal budgets this year for education, energy, homeland security and the wars in Iraq and Afghanistan.

Americans now have to climb out of two deep holes: as debt-loaded consumers, whose personal wealth sank along with housing and stock prices; and as taxpayers, whose government debt has almost doubled in the last two years alone, just as costs tied to benefits for retiring baby boomers are set to explode.

An increase of one percentage point in the Treasury’s average cost of borrowing would cost American taxpayers an extra $80 billion this year — about equal to the combined budgets of the Department of Energy and the Department of Education.

Treasury officials estimate that about 36 percent of the government’s marketable debt — about $1.6 trillion — is coming due in the months ahead.

UK Health and Safety Snoops to Enter Family Homes

http://www.timesonline.co.uk/tol/news/uk/article6917328.ece

Health and safety inspectors are to be given unprecedented access to family homes to ensure that parents are protecting their children from household accidents.

New guidance drawn up at the request of the Department of Health urges councils and other public sector bodies to “collect data” on properties where children are thought to be at “greatest risk of unintentional injury”.

About 100,000 children are admitted to hospital each year for home injuries at a cost of £146m.

And in the last line we see why this is happening. Government run healthcare does not want to pay.

Many California Jobs "Saved' by Stimulus Funds Weren't in Jeopardy

http://www.sacbee.com/topstories/story/2309303.html

Up to one-fourth of the 110,000 jobs reported as saved by federal stimulus money in California probably never were in danger.

Proposed Law Would Require Pay for Sick Workers

http://www.reuters.com/article/healthNews/idUSTRE59J58H20091103

They are private companies. If they don't want you to work because you are sick, then that's their prerogative.

U.S. Said to Order Deep Pay Cuts at Bailed-Out Companies

http://www.cnbc.com/id/33417281

Under the plan, which will be announced in the next few days by the Treasury Department, the seven companies that received the most assistance will have to cut the annual salaries of their 25 best-paid executives by an average of about 90 percent from last year. Their total compensation — including bonuses and retirement contributions — will drop, on average, by about 50 percent. The companies are Citigroup, Bank of America, American International Group, General Motors, Chrysler and the financing arms of the two automakers.

Let the mass exodus of talent begin.

U.S. September Auto Sales Plunge; GM, Chrysler Hit Hard

http://www.reuters.com/article/businessNews/idUSTRE59066D20091002?rpc=64

U.S. auto sales tumbled by 23 percent in September as showrooms emptied after the government-funded boom from the "cash for clunkers" program, with General Motors Co and Chrysler hardest-hit.

Sales for General Motors Co and Chrysler -- the two U.S. automakers struggling to regain momentum after emerging from bankruptcy -- dropped by 45 percent and 42 percent, respectively.

Ford -- the only U.S. automaker to have avoided bankruptcy -- managed to hold its sales decline to 5 percent from a year earlier despite low inventories and reduced incentives for car shoppers.

When you artificially inflate demand, the market corrects in following periods to a point lower than the original demand. Economics 101 people.

Obama Would Curtail Summer Vacation

http://news.yahoo.com/s/ap/20090927/ap_on_re_us/us_more_school

Students beware: The summer vacation you just enjoyed could be sharply curtailed if President Barack Obama gets his way.

Obama says American kids spend too little time in school, putting them at a disadvantage with other students around the globe.

The problem isn't lack of classtime, it's lack of quality class time. Increasing class time won't make students any more competitive international unless they are taught correctly and the right material. Also, what ever happen to powers not expressively given to the Federal government are relegated to state governments?

Who's Rummaging Through Your Garbage?

http://www.dailymail.co.uk/news/article-1216680/Council-spies-dressed-hoodies-rifle-residents-rubbish-waste-analysis.html?ITO=1490

The 'spies' were part of a week-long waste analysis study by the Northamptonshire Waste Partnership, a collaboration of eight local authorities working to reduce rubbish going to landfill. An external contractor was told to go through the bins of residents.

Residents of this street in Irchester, Northamptonshire, had received no notice about the council's plans to sift through their rubbish

MA Pandemic Bill Allows Health Authorities to Enter Homes, Detain Without Warrant

http://www.wnd.com/index.php?fa=PAGE.view&pageId=108604

A "pandemic response bill" currently making its way through the Massachusetts state legislature would allow authorities to forcefully quarantine citizens in the event of a health emergency, compel health providers to vaccinate citizens, authorize forceful entry into private dwellings and destruction of citizen property and impose fines on citizens for noncompliance.

If citizens refuse to comply with isolation or quarantine orders in the event of a health emergency, they may be imprisoned for up to 30 days and fined $1,000 per day that the violation continues.

Lest we forget the 4th amendment:
"The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized."

Obama Propaganda Through NEA?

http://bighollywood.breitbart.com/pcourrielche/2009/08/25/the-national-endowment-for-the-art-of-persuasion-patrick-courrielche/
http://www.youtube.com/watch?v=JzNBo3VnhWg

"It felt to me that by providing issues as a cynosure for inspiration to a handpicked arts group - a group that played a key role in the President’s election as mentioned throughout the conference call - the National Endowment for the Arts was steering the art community toward creating art on the very issues that are currently under contentious national debate; those being health care reform and cap-and-trade legislation."

We were “selected for a reason,” they told us. We had played a key role in the election and now Obama was putting out the call of service to help create change. We knew “how to make a stink,” and were encouraged to do so.

“This is just the beginning. This is the first telephone call of a brand new conversation. We are just now learning how to really bring this community together to speak with the government. What that looks like legally?…bare with us as we learn the language so that we can speak to each other safely… “

Seller, Beware: Feds Cracking Down on Secondhand Sales of Some Products

http://www.kansascity.com/444/story/1395184.html

If you're planning a garage sale or organizing a church bazaar, you'd best beware: You could be breaking a new federal law. As part of a campaign called Resale Roundup, the federal government is cracking down on the secondhand sales of dangerous and defective products.

The commission's Internet surveillance unit is monitoring Craigslist and other "top auction and reselling sites" for recalled goods. If the agency discovers that a recalled product has been sold online, it will try to find and inform the buyer, Wolfson said.

Nancy Lothrop, a mother of two in Monroe, Wash., was surprised to learn that she might be violating the law by selling about $200 worth of Polly Pocket dolls and accessories on Craigslist that her 12-year-old daughter no longer wants.

Dealers Still Waiting For Clunker Cash

http://www.keloland.com/NewsDetail6162.cfm?Id=89419

During the month long program, Billion Automotive sold close to a thousand vehicles but has only been reimbursed for 272 of them. Vern Eide sold over 200 cars and has only been paid for 27 of them, and that's fueling lots of concerns in the auto industry.

Billion Automotive cashed in during Cash for Clunkers, but owner Dave Billion is still waiting for the rest of his money from the government run program, $3.2 million.

"I wonder how long they'd wait if I owed them $3.2 million. I think they'd be at my door or at least my banker's door," Billion said.

"We had a situation where we had a submission, they rejected it for multiple reasons. We didn't see anything wrong with it, so we resubmitted it. They rejected, we resubmitted it. They rejected it, seven times and finally they paid it, and we never changed a single thing on it," Billion said.