Paul Hsieh thinks that it should be. I have to agree with the commenter, though, who thinks that Hayek is a better bet.
Category Archives: Business
Take Your Tea And Shove It
Economy stimulator extraordinaire Iowahawk tells the American Tea Party what to do with their bags:
Thanks to the new federal mortgage bailout bill, Americans like me are finally on track for housing security. Previously facing a $1.2 million debt from three mortgage on a home recently appraised at $43,500, less missing bathroom fixtures and windows, the President’s plan allowed me to renegotiate my payments down to a level that will keep me solvent until at least mid June-ish. Now that my family and various friends from Jimbo’s Tap Room no longer have to worry about having a stable crash pad, we are finally free to resume the spending that will lead America back to economic prosperity.
I wish I could take credit for it, but it took the collective effort of hundreds of thousands of us in the subprime community, working with the financial industry and public sector officials. Unfortunately, there is another group out there who is working to kill important financial bailout reforms just as they are sparking a renaissance in the American housing market. I’m speaking, of course, of the so-called “Tea Party” tax protesters.
I’m sure you’ve heard of them or read their emails: “Wah, I paid my mortgage.” “Wah, I didn’t use my house for an ATM.” “Wah, Dave I need that hundred back I lent you at Christmas.” Now, I’m as sympathetic to a good sob story as anybody, but these whiners have nobody to blame but themselves for their predicament. Anyone who kept track of the Gallup presidential polls last year should have known what was coming, so don’t blame me if you decided to waste your money paying your stupid mortgage. But, in the six-dimensional bizarro world of these noisy tax gripes, they expect me to give up my bailout to pay for their irresponsible lack of foresight! Helloooo?! Beam me up, Scotty!
Some people are just ingrates.
Ahhhhnuullld The Democrat
I’m listening to the evening news on my last night in LA, after the announcement that the state unemployment is in double digits, hearing the RINO Governator talking about how “creating jobs is his highest priority.”
Well, ignoring the issue of “creating jobs” (which can be done by simply handing out money stolen from the taxpayers or borrowed from future taxpayers to pay people to do various things of various and dubious value, often negative) as opposed to creating wealth and not making war on prosperity, here’s an idea, Arnie.
How about doing an analysis of previous California policy to figure out why the jobs were destroyed, and stop doing and start undoing those things? Or is that too hard?
That’s Not The John Maynard Keynes That I Knew
Apparently, President Obama and the Congressional Democrats have thrown Keynes under the bus, too, even though they don’t realize it:
…it is true that government direction of capital is something Keynes advocated. But the current direction of capital by government is being conducted in a manner that flies in the face of Keynes’s underlying justifications for such state involvement.
For example, the stimulation of investment has thus far been ad hoc. The Treasury and Federal Reserve have infused capital into some firms but not others. In the case of financial firms, the rationales have been to promote liquidity or prevent insolvency or both. The government has moved on to direct capital into the troubled automobile industry. The Federal Reserve and the Treasury are buying mortgage-backed securities, thereby making more credit available to the housing industry. The construction trades are expecting a huge infusion of capital under the rubric of “infrastructure” spending. And now an enormous list of other industries has been approved for temporary stimulation by the Obama administration.
It is difficult to imagine that Keynes would be enthusiastic about these temporary and discretionary policies given his diagnosis of the fundamental problem.
The historical record is helpful here. Keynes opposed immediate, short-term stimulus in 1937 when the British unemployment rate was 11 percent—much higher than we are experiencing today. Furthermore, he opposed temporary reductions in the short-term rates of interest because he believed that variability of interest rates sent the wrong long-term message. As he argued in “How to Avoid a Slump,” an article in the Times of London newspaper, “A low enough long-term rate of interest cannot be achieved if we allow it to be believed that better terms will be obtainable from time to time by those who keep their resources liquid.”
Of course, most of these people are far too economically illiterate to even understand Keynes. Instead, they simply adulate him as a god and use him as an excuse to do what they want to do anyway, regardless of whether or not it’s truly Keynesian.
[Update early evening]
More historical ignorance: Barack Obama versus Henry David Thoreau. Now, Thoreau was actually sort of a loon, and his “wisdom” is highly overrated, as P. J. O’Rourke has amusingly pointed out in the past, but the notion that the small-government philosopher would have approved of the “stimulus” plan is ludicrous.
Thoughts On COTS
…along with fixed-price versus cost-plus, appropriate payment milestones, and “skin in the game,” from Jon Goff.
We have to come up with much more innovative means of reducing the cost of access to orbit, something that Ares I doesn’t do at all. Charles Miller just became “Senior Advisor” on space commercialization with NASA’s Innovative Partnership Programs Office, so perhaps he will be able to help implement some of these kinds of ideas.
Missing George Bush
The Anchoress does. It would have been hard to imagine a year ago, but President Obama has achieved the seemingly impossible. I do, too. Certainly our portfolio does. That’s more of a commentary on President Obama than on President Bush, though.
The Next Stage Of Wrecking The Economy
Get ready for the cram down:
Now, maybe higher interest rates on home loans would be a good thing. Home ownership is heavily subsidized in this country, and the reason bankruptcy law currently protects banks from losses on principal is so that they can keep mortgage-interest rates low. But is Congress really going to let mortgage-interest rates rise as a result of this new law? Liberal interest groups already think credit-card interest rates are a crime against humanity. Can you imagine the hue and cry whenever mortgage-interest rates start to tick up?
The more likely scenario is that Congress passes some new law that keeps mortgage-interest rates suppressed, even though the new bankruptcy law has exposed banks to greater risk. If your goal is to re-inflate the housing bubble and create another credit catastrophe, well, there you go.
It’s truly infuriating the way politicians muck with the market, then implement more mucking to deal with the unintended consequences of the first muck, and then blame laissez-faire capitalism for the problems. And the media let them get away with it, repeatedly.
The Man Who Talked Back
In 1937, there was a radio debate between Wendell Willkie— later to become the 1940 Republican presidential nominee—and Franklin Roosevelt administration official Robert Jackson—later a Supreme Court justice—about the proper economic role of government. (The event and its fallout are wonderfully described in the outstanding book “The Forgotten Man” by Amity Shlaes.)
By all accounts, Willkie won easily by arguing that FDR’s efforts at nationalizing the utilities industry, his dramatic tax increases, and his administration’s push for prosecutions of businessmen had frozen the private sector with fear and prevented the country from returning to prosperity. The Saturday Evening Post would later dub Willkie “The Man Who Talked Back” against the New Deal and Big Government. I would love to see a debate between Santelli and Obama spokesperson Robert Gibbs.
Yeah, I’d pay to see that, but they’d have to institute a mercy rule, I think, after the first ten minutes.
I hope that Santelli is ready for his upcoming IRS audit.
Space Billiards
There is an excellent and comprehensive discussion of the recent satellite collision over at The Space Review today. There is plenty of blame to go around, from perverse incentives in the military, to government policies that are long on rhetoric and short on funding and priority, and corporate risk taking:
It also appears that either Iridium or the JSpOC terminated the collision screening for the Iridium constellation at some point between July 2007 and the collision in February 2009, as Iridium has made repeated public statements that they did not receive any warning. Likewise, the US military has stated that they did not have any warning. The following additional comment by Campbell at the same event may shed some light as why this happened:
That said, this isn’t aviation; the Big Sky theory works [emphasis added]. We figure that the risk of a collision on any individual conjunction is about one in 50 million. However if we have 400 a week for ten years, you can do the math; clearly that risk is something bigger than zero. As I said, our coordination with JSpOC is great.
Basing the protection of the largest low Earth orbit constellation of satellites on such a theory, even when there is a significant amount of data showing that it could be false, leads one to question the decision-making process involved. Perhaps Iridium decided that they could not afford the resources to deal with the decision-making and maneuver planning to properly operate their satellites in a safe manner. If that is indeed true—and there is no known hard evidence either way—then they placed the short-term financial well being of one company over the long-term welfare of all.
Clearly, the entire international system in place for dealing with this kind of problem (to the degree that it exists at all) needs to be overhauled.
Sure About That?
Kaus says that there are only four GM cars that he would consider buying, and one of them is a Chevy Malibu. Well, I rented one from National at LAX on Wednesday night. The thing has the turning radius of a supertanker (which is particularly problematic given the postage-stamp-sized parking spaces in LA). It also scrapes the undercarriage (or at least the bottom of the front license plate) coming in and out of the driveway, a problem that I didn’t have with the Versa I was renting last week.
I wonder if he’s test driven one?