Thursday, December 16, 2010

• Obama’s Impossible Gordian Knot

Over 2300 years ago, birth was given to a myth which in time became a powerful metaphor that has served us well through the ages when addressing seemingly impossible or intricate challenges. Halfway through the current Obama Presidency we face a moment when reaching back for an ancient Greek analogy has become self evidently appropriate.

Legend tells us that Alexander The Great fulfilled a prophecy by bringing a creative solution to the Gordian Knot – he sliced the complex knot with his sword, thereby showing himself capable of thinking outside the box. Gordian, the mythological king of the Phrygians had tied his oxcart to a palace as an offering to Zeus, and an oracle had foretold that whoever untied the knot would conquer Asia. Although he died at the young age of 31, Alexander’s conquest of a continent started with a bold decision.

History has provided ample debate on the event of Alexander’s controversial “solution,” and whether it was actually any solution at all, however, Alexander’s omen, has remained a favorite metaphor.

The present moment in history finds a society struggling with overwhelming unemployment, as well as a worrisome personal and national level of debt. Productive employment is critical to sustenance of a vibrant society, and it is through that employment that the costs of all of society’s “structural and functioning” needs get paid. A majority of Americans also understand that it is business and industry, large and small, that create employment, and the basis for all other employment. Without such employment, government doesn’t get paid. While this should be abundantly obvious, the American taxpayer is being led by an Administration that seems not to understand.

America went to the poles during the midterm elections and emphatically voiced its displeasure with the way the Administration and Congress were treating its most serious and urgent concerns. America is looking for leadership capable of making bold decisions.

This week, Obama is facing his archetypal Gordian Knot, IMHO. The current debate over the maintenance of the Bush tax cut has been worthwhile, and pushes economic discussion to the fore, which serves to educate. The solution to America’s economic woes however, does not rest with an extension of the Bush tax cut. The solution rests in the aggressive stimulation of job creation, and leadership that will-not-sleep-until unemployment numbers have been halved.

On Wednesday we were treated to novel expressions from an American President such as this one uttered by Obama to 20 CEOs in a session held yesterday with the Administration, “I want to dispel any notion we want to inhibit your success.”

The fact that his grammar is questionable matters less than the fact that he would have to say anything remotely close to an attempt at denying he has and will continue to “inhibit” the success of all businesses. His actions precede him, so his words appear to come from a distant corner of the twilight zone. It is not in his DNA to either stimulate economic growth, or care what the fat cats (his own rhetoric) of corporate America need to see from their government in Washington. He does not understand, and cannot understand.

The MSM is even posting articles about “détente” between this Administration and business. Détente? As in, “he’s at war?” Who would have thought this concept remotely possible in twenty first century America? In the middle of an extended recession, who would have expected a question posed to a sitting President such as the one asked by CNBC’s John Harwood, “Mr. President, can you repair your relationship with business?”

Pretend all he wants at “dispelling,” Obama is incapable of providing a solution to his Gordian Knot, because he does not comprehend the most significant problem facing the country over which he presides.

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Friday, November 12, 2010

• Another Misstep On Obama’s New Battle Front

There is little argument that the concluding G-20 meeting has been an international beat-up slugfest on America. Effective and substantial Strategic Planning is critical in the success of any significant endeavor. It should be ever-present when addressing the country’s economic long-term health.

Obama and his advisors fumbled once again on the international scene. Unfortunately, this time the fumble was on an economically critical battlefront.

The Fed continued its artificial manipulation of the economy by announcing that at the stroke of a pen filled with dollar printing ink called the Quantitative Easement Quill, a tidy $600 billion will be added to the float. While there is urgency in taking decisive action to stimulate hiring across the country, The Fed’s bond purchase program could have waited announcement another few days, particularly since it will be implemented over a very extended period. The Fed may in fact decide to scale back on the total amount depending on how the economic activity trend reacts.

Currency fluctuations have not been the source of the current economic crisis, but have been the outcome of such things as the overwhelming export of never to return jobs to inexpensive-labor-gives-us-cheap-products countries, AND we can artificially inflate national wealth by enforcing the financing of a home-for-each-citizen program.

Announcing the easement (read: circumlocutive euphemism for Inflative) just prior to G-20 gave China a major pass at the meeting, and in fact, pushed it to stand shoulder-to-shoulder with America’s “friends” pounding on America. The G-20 meeting should have been more about China’s maintenance of a weak Renminbi, and protectionism, rather than about the U.S.’s wholesale weakening of King Dollar.

The Bernanke announcement resulted in a verbal assault on America by everyone from China to Germany. America’s defense was left to representation by a President not familiar with things economic. It isn’t even clear that China’s real relative exchange rate hasn’t appreciated recently given the rapidly rising prices within China. Just like The Fed, whose complete independence from Congressional control or real oversight enables it to go wherever it wishes to go, so too China will ignore all bended-knee implorations from Obama and Geithner.

Now to make matters doubly difficult, the Administration is shouting into the deaf ears of its trading partners and geopolitical friends. China will continue on its merry way, and it has firmly confirmed that it would completely ignore the Administration when it admonished Obama as he went out the door with a, “Don't make others take the medicine for your disease,” (Yu Jianhua, a director general of China's Ministry of Commerce). The opportunity presented by the G-20 meeting to coagulate forces to pressure China is now passed, and the situation has been made worse for America.

This Administration really must take some classes on Effective Negotiating.

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Wednesday, September 8, 2010

• More Erratic Economic Notions From Obama

After almost two years of demonizing corporate America, holding a “boot to its neck,” and doing nothing for small businesses, Obama suddenly pretends to reverse himself with a “corporate tax break.” This is political pandering, and at odds with what is required to set employment trends on an upward path.

In between teleprompter stopovers and golf games, Obama comes up with helter-skelter strategies aboard Air Force One that serve little but confuse the country he was elected to lead. Obama’s new one-year tax relief on capital investment looks like a stroke of genius in his mirror. Does he know that companies, from the local bakery to the coalmine, actually have plans - long term and mid term action plans? Evidently not. Your local dress shop spends more time on “planning” than this President. I also suspect that the owner of that dress shop spends less time holidaying, and more time struggling to keep the business afloat. The “I will not rest until . . .” incantations from the Oval Office not only ring hollow, they are overt lies.

This Administration’s disconnected actions assert that no cohesive economic plan is in the offing. Prolonged uncertainty will continue to limit hiring and minimize commitment to long-term capital expenditures. Only a very few large corporations with plans already on the books to expand capacity will take advantage of this temporarily accelerated tax break. This plan enables an acceleration of depreciation allowances which businesses would deduct over time, as such implementations fit into corporate long-term plans. It should be pointed out to this Administration that all companies develop and implement strategies which include capital expenditures constructed from outlooks on such elements as market expansion, market penetration, competition and product demand. Corporations set budgets that include major spending, years ahead of time.

Perhaps Obama has also not checked interest rates lately. If a successful company needs money to expand, its interest costs are minimal, and it will be able to deduct its capital expenditures over time. On the other hand if the company is feeling strain it won’t get the credit very easily. Either way, before getting a tax break, companies have to have decided on the expenditures, and acted on them – you have to spend before you can claim. This Obama tax credit will have little real impact on corporate America. When there is uncertainty, companies retrench, and hold tight. Only a fool of a CEO would run out and build a plant that wasn’t in the works just because of the sudden and temporary appearance of an accelerated tax break. Government should not insinuate itself into the efficiency with which corporations allocate their resources.

This stroke of genius will accomplish nothing for Middle America and the unemployment ranks. Evidently no one around this President has managed a large corporation, and he is ignoring any useful advice if he’s getting any. This announcement might be more palatable if it was one minor element in a broader strategy to inject confidence, stimulating businesses to action, particularly smaller businesses. Much like the Clunker For Cash program, this temporary manipulation of the tax code is a desperate political Hail Mary with no regenerative effect. It is also a manipulation that dares Republicans in Congress to react negatively to a “pro-business” pretense.

The President could announce something meaningful like restructuring the corporate tax code to drastically simplify the process for all businesses, thereby reducing their headaches and costs.

Obama’s other sudden stroke of brilliance, the Research Tax Credit, is a non-starter for the simple reason that the American economy will only get going again when small to medium sized businesses start hiring. If this sector of the economy isn’t with you, nothing is happening. As for the large corporations, they will not suddenly spend some “research” money that they aren’t already spending, just because there’s a tax break on the table. If that were true, any CEO making that decision should be fired for incompetence and poor planning. Small to medium sized businesses are the engines of a successful and stable Middle America. Those businesses don’t spend much on research. They find a need and they fill it. This $100 billion tax announcement panders to the education industry, and does little for the business environment where it counts. What it creates is a cash-bag whose contents will be dished out in allotments proportional to the political affiliation of the recipients. What a surprise.

Obama’s $50 billion stimulus package announced this week for roads and runways will be similarly designated in political vote-purchase-bundles which will create temporary employment, but create nothing for the long term. This could be momentarily seen in positive light, if it was capital invested from surplus funds. Such billions created out of intolerable debt is another toxic tin can being kicked down the road for our grandchildren to feed out of. This is not part of a cohesive long-term plan that will increase national productivity. It smells more like a haphazard “throw stuff at the wall,” and “make noise about how many jobs we’ve created,” deficit spending bill looking for Congressional approval. Obama may be deaf to his electorate, but Congress is getting the message, and we can predict this will not get passed even through the back door.

While the President is stomping and performing in the grand and absurd political theatre of the campaign trail, shouting about his opposition “talking about him like a dog,” or making strange comments about “blue skies,” and “fish in the sea,” (what audience does this appeal to?) Obama should ponder the structure of a firm policy statement to immediately table major cuts in government spending.

This, above any other announcement he might make, would inject renewed vigor, and confidence into the National landscape.

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Tuesday, August 17, 2010

• Pent-up Pressures Will Explode Into A New Age Of America

The Obama Administration nudges Treasury Secretary Timothy Geithner to the front of the class to present Pollyanna statements on subjects apparently not fully understood by the President or many of his advisors. Millions react with little more than frowns of confusion.

The skeptical population is exposed to too many scripts on the economy written in rose-colored ink, read through rose-colored lenses. Listening to Geithner, leads one to wonder if he’s read the news lately. Actually seeing him, leads one to doubt that he cares. Down the road, Bernanke does as he’s told by the bankers who have little concern for 17%+ unemployment. Their multi-billion dollar bonuses are thick insulation from the plight of Middle America. Ben Bernanke pontificates from The Fed, pretending that inflation is a curse, when in fact its advance would erode the assets of his bosses on The Street. Inflation’s impact would also be a reduction of the real debt currently burdening homeowners whose perceptions rendered home ownership a panacea.

Hypocrisy is one those more despicable black arts practiced by too many sitting in positions of influence. Self preservation and self interest too easily twists truth from the podiums of power, and confuses a population unfamiliar with the complexities pretended by economists. Today a whole middle class shudders at the long term prospects of its underwater mortgages further sliding into an abyss, as job continue to evaporate.

The public sustains abuse, particularly when the likes of Geithner, and Bernanke continue the reign of power and influence enjoyed by Greenspan, even after having proven complete and absolute incompetence during the creation of the mess. Of course in fairness to Bernanke and Greenspan, we should note that Geithner additionally demonstrated contaminated morals and meager principles in his tax filings. These three mousequeteers of finance and their friends, along with the misguided Congress of the past 20 years fuelled the indebtedness now burdening an anguished middle America. The crisis is the result of burst housing and debt bubbles, which many perceived correctly and some capitalized on. Bernanke, Geithner and Greenspan were not among them. Bernanke, however, was very capable when he effectively misled Congress on behalf of his boss in the White House and his bosses on The Street, to get the Troubled Asset Relief Program (TARP) passed.

Both businesses and consumers are ignoring Bernanke’s continuation of “cheap debt”. If you’re concerned with job security, you’re not running out borrowing for a bigger home. These days, no one wants more debt, it seems. No one, that is, except Washington.

The lamentable uncertainty afflicting every corner of the United States has permeated its business engines. In Board Rooms across the Nation, Accountants are telling their bosses, “hold tight.” CEOs aren’t economists, or fortunetellers. They gleam information from those they have hired, and those which they have confidence in and trust. From behind closed doors, senior executives sense the choking “uncertainty” and they fear it. The result? Corporate America sits on almost $9 trillion in cash and counting.

Another result? Investors purchase Johnson & Johnson 2.95% ten-year notes, preferred over company shares or even over Treasuries with downward sliding yields. Suddenly junk bonds are more delectable than Treasuries? This is a major shift in perceptions. It is also telling of concern for the economy’s future, mid to long term. It speaks volumes of investor confusion about the economic future. Corporate America and Main Street are uncertain, and Washington daily adds to the confusion.

Corporate America would normally look for any excuse to invest. American business is seeking signs from the country’s leadership that it can “get behind.” That is the biggest failure of the current leadership in Washington. No one in the Capital seems capable of leading the charge to the restoration of confidence, least of all the inexperienced President. Ineptitude, indecision, reckless spending and loading up the future with unfathomable debt, pulls the train of hope into reverse.

A panoply of hapless maladroits appear like balls bouncing down a pinball machine, reacting to daily events with little grasp of the most critical expectations of a tired public. Perceptions are powerful forces moving through the country’s social, economic and political fabrics. While stagnating over economic stimulus package decisions, Washington should give energy to psychological stimulus.

Assertive leadership should take forceful steps to reduce administrative bureaucracies, and streamline all levels of the structures providing services, including simplification of the taxation and the health-care systems. Other actions should include biting into the biggest lie of them all - the Social Security and health-care costs which almost 80 million Baby Boomers have been led to expect as they head into retirement. The expectations represent entitlements of $4 trillion which the U.S. economy will be incapable of supporting. There is even more important action for a leader to take. Inspiration.

It is not the nature of the average American to want coddling by big government. America has long demonstrated a propensity for innovation, hard work, creativity, and entrepreneurship. America has progressed through numerous transformations since its founding. The vast majority of jobs lost in the past five years have been in manufacturing, while the most stable corporate environments have been those in the high technology industries.

We may not know what new chemicals or revolutionary algorithms will trigger new industry sectors, but as the future unfolds, America’s destiny will rest on the stimulation of interaction between people and the stimulation of thinking which will galvanize toward new discoveries. Avenues of communication, through the Internet, as well as physical corridors such as high-speed trains between major urban centers will further stimulate connections and energize creativity. Each of these discoveries, large or small, will then need encouragement on risk taking, and entrepreneurship.

Companies, nascent and mature, will require the opposite of the noise which is today effusing from Washington. Leadership means pointing to clear defined goals and energizing Main Street. It means stating confidence in the bearing – clear heading and clear direction. Once such leadership leaps onto the stage, there is pent-up pressure from the cash stockpiles corporations are sitting on. Just as significant is the pent-up creativity and innovation waiting to commercialize the next technological revolution. The psychological stimulus America hungers for, is inspiration.

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Thursday, August 12, 2010

• Gang Receives Succor From Federal Judge In Gang-Haven Vancouver

Canada’s Federal Court brings new meaning to coddling criminality. A Federal Judge has handed down a decision that will heretofore ensure that Canadian authorities will address criminal gangs with proper decorum and “quiet” respect.

Federal Court Judge The Honourable Mr. Justice Michael L. Phelan has, in one simple judgment, backhanded Revenue Canada, and the Gang Task Force. Justice Phelan has stymied and impeded any future approach government officers and officials might make on gangs and their members.

Here is the heart of his decision on behalf of all Canadians (Docket: T-555-08, Citation: 2110 FC 448): “THIS COURT ORDERS that the Applicants are awarded fees of $200,000 plus disbursements of $13,986.92. The Applicants are to have their costs of this motion of $3,000 plus disbursements of $500.”

The applicants are Ryan Murphy et al, . . . et al being his UN gang member associates, and the respondent is the Minister of National Revenue, which is in effect the Canadian taxpayer. Canadian taxpayers, . . . the gang thanks you.

Why would a judge of the Federal Court hand down such an astounding decision? Why would the Court in one bang of the gavel render ineffective any future investigations into the countless billions of dollars that are being made illegally and purchasing businesses and estates from Victoria to Halifax? Why would the Federal Court have a problem with Revenue Canada digging into the non-existent sources of income which materialize so readily into so much material and visible wealth? Why would a Federal Judge decree that the Revenue Canada Agency (CRA) should in effect care little about its own personal safety when serving Requests for Information on very well known and dangerous criminals? Why would a Federal Judge have a problem with the CRA investigators teaming up with Gang Task Force members to deliver request letters to gang members?

Justice Phelan’s stated reasoning was that “Police presence was clear and visible and highly obtrusive. The service of the documents was generally carried out late at night, with multiple police cruisers present, lights on and with all the paraphernalia of a police raid.”

So? Are all Canadians now suddenly in fear of being similarly served? Is this what this judge thinks is, . . . protecting Canadians from overt and visible harassment from the police?

Shouldn’t the authorities have some room for common sense? Shouldn’t Revenue Canada be used to launch investigations into illicit earnings? Don’t most Canadians know that the neighbor just down the road with NO visible income, but with the mansion and fleet of cars in the driveway, might be, just might be, in the drug business, for example?

If the authorities have evidence of such, let them have at it, and if they break the law in the process, then charge them, or fire them, or both. It flies in the face of common sense to think that if what occurred in this case is allowed by the judicial system, then we would all see multiple police cars at our doors delivering requests for itemized income sources. Canadians should beware of those pretending to defend them against the beginnings of “slippery slopes.” Canadians should beware of this judge.

A judge pandering to an ephemeral notion that his decision, right off the scale of common sense, protects the public, is a twisted percept rooted in self importance. The police admits that the gang problem in Canada, particularly Vancouver, is out-of-control. Isn’t the Canadian public getting tired of witnessing its police force stifled by the courts?

This judge’s sanctimonious decision panders to some righteous percept that the judiciary grasps elements pertaining to the social order that society at large cannot possibly comprehend. For too many years, the Canadian courts have been ensconced in the belief that they have unique abilities to perceive realities that their broader community is incapable of considering. These former lawyers are wrong.

Their many incomprehensible decisions are not so difficult to fathom. It is not the nature and complexity of the cases that society cannot understand. Canadian society cannot and should not accede to decisions which negatively affect the social setting. Decisions such as the one handed down by Justice Phelan add to the government’s failure to accomplish its most critical purpose – preserving the safety of citizens and their property. When our public schools have pushers selling drugs to 7 and 10 year olds, the system is broken. The courts have much blame to shoulder for this calamity, along with Canada's Parliament.

This court order was not about the prevention of entry onto slippery slopes, but was the result of incompetence on the Federal bench. The decision should be reversed.

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Tuesday, August 10, 2010

Canada Welcomes Illegal Sri Lankan Asylum Seekers

Canada, the world's leader in the immigration business, is about to welcome the first of many ships carrying illegals from Sri Lanka.

The Canadian immigration industry is licking its lips at the imminent arrival of a ship load of illegals, with lawyers lining up to leach off the Canadian taxpayers, and the Courts are making sure that endless days will be cleared from the dockets, so judges can enjoy the stories of downtrodden Sri Lankans well into the next decade.

The Canada Border Services Agency (CBSA) will pretend to filter the good from the bad, not having a clue about much, since no human being on earth can vouch for the veracity of any documentation presented in pretense on the origins of any asylum seekers. There are few countries in the world where documentation cannot be purchased, names changed, false birth certificates magically created, and new family members materialized.

Canadian taxpayers seem to rest easy in the knowledge that the CBSA will investigate thoroughly, then make sure that Canada becomes the destination of choice for Tamil asylum seekers, replacing the formerly more convenient Australia. Canada will enjoy the unique distinction of being the only country on earth not overly concerned with allowing Tamil Tigers into its midst. Pretending otherwise, is pretending that the CBSA has the capacity to know the difference between terrorists and non-terrorists, and also further pretending that it has the capability of tracking them once they’ve allowed them into the Canadian society at large.

Canada has no way to track anyone. The immigration industry knows this and takes advantage. Daily abuses of the many loopholes in the country’s laws result in the government having no idea of the country's real population.

There are almost 7 billion people on earth, most of whom live in abject poverty, in overpopulated corners of the earth. Canada’s doors seem wide open. Canadians have for generations attempted to build a country that could support itself. For some reason, the current version of Canadian governance is following the Jean Chretien belief that “Anyone who wants to live in Canada, should be allowed to live in Canada.” Such genius thinking now brings a need to increase taxes (such as HST) to feed a rapidly breaking system, . . . a system controlled by too many lawyers who were elected to the National Legislature over the last century.

Canadians should know that their government is under no international obligation to accept a ship arriving under false pretenses. Ottawa should stop aiding and abetting the human smuggling operations of international criminal organizations.

Those pretending that Canada is a wealthy country and that it should “share,” haven’t spent much time with the average Canadian household working multiple jobs, and carrying personal debts second only to their neighbors to the South.

The concern here isn’t even about Tamils, but about an attitude toward the preservation of a fast disappearing lifestyle. Overcrowding was once not a Canadian objective. The clogged arteries of Vancouver and Toronto are evidence that the balance has tipped.

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Tuesday, July 13, 2010


America is shuddering in a struggle to shake off a recession, just as it is told the recession might morph into a depression. The admonishments coming from the daily teleprompter addresses of its President further shake the nation’s confidence, as blame becomes the only strategy dripping from the country’s leadership.

America has ushered in a new age of self admonishment led by a White House and a Congress that are using the widespread economic crisis to reinvent the country. As the administration increases spending, and augments government intrusion into all corners of human endeavor, it rationalizes the trillion dollar budget deficit, and ignores the looming burden of overwhelming debt. The government ignoring the imminent and inevitable monetization of this debt, doesn’t subdue the anxiety felt by entrepreneurial or mid-sized businesses in every corner of the country.

Beside shattering the economic foundation with which America has been endowed, this Administration and this Congress are also doing everything possible to internationalize their own feelings of impotence. Through promotions of head-numbing programs such as those given energy in Copenhagen, or the exaltations on the cap and trade contrivance, there is astonishing evidence that a radical transformation of the country is being attempted.

Actions and policies of this White House are either purposeful or the result of ignorance, but in either instance, the MSM is providing it a pass on the majority of its follies. In some cases the MSM even applauded from the sidelines such as when Obama strengthened the influence of the United Auto Workers over the US auto industry. Americans watched passively as the very unions who destroyed Detroit were provided even greater influence over companies that now flail against advancing forces of extinction. The people who abused their power and the cash of their own membership for most of a century, now dictate the future of the American automobile.

Working Americans, and all those who have lost good paying jobs, will not be lulled into believing in taxpayer funded windmills, but they are being demoralized by Washington politicians who can’t seem to tell truths, or provide direction. The endless releases of nostrums pitched by a floundering President leave little suspense as to his abilities, or capacities to lead the country creatively out of the doldrums. His limitations have further evidenced themselves in those he has surrounded himself with. His most senior advisors and appointments are either reflections or lesser versions of their boss.

There is also failed leadership in the richest corners of corporate America where the most visible captains of industry have not shown themselves to be diligent or effective in administering their fiduciary or managerial duties. Some, such as the CEOs and Directors of City Bank, AIG, Lehman, Merrill Lynch, and Citygroup, have in fact proven to be weak-kneed, and self serving hacks who had to run for cover, begging for taxpayer bailout money when twenty years of easy money, easy growth and easy markets turned against them.

Americans do not appreciate bailout receivers or givers. Americans don’t respond so well to whiners and blamers who depend on committee regurgitations for direction. Americans, like most fellow human beings, respond positively to optimistic visionaries who are clear, confident, and straightforward on goals and strategies.

The current leadership appears incapable of pulling the national consciousness out of its stagnating paralysis. The nation has slowly slid into react mode, with no charisma-with-purpose pulling its attention. The result is a country of demoralized taxpayers staggering to pull the eject lever on incumbents. Unfortunately this negative energy is simply a reaction against the current leadership, rather than a wave of confidence empowering an inspiring champion.

America is once again playing “find a leader.”

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Monday, July 5, 2010

• The Obama & Krugman Keynesian Conceit

Paul Krugman, the Keynesian drum-beating economist, was invited by CNN on Sunday to promote the Obama strategy of pumping additional billions into the economy. One of his very telling responses to Fareed Zakaria’s question on significantly more spending and borrowing was “what about now?”

This very self serving response from Krugman was an advocacy of profligate spending very much in keeping with a too popular expectation of immediate gratification. Pushing the debt onto future generations, and “get-me-what-I-want-now,” is the egocentric inclination that delivered the current state of financial devastation. “What about now?” came from the mind of an economist who exudes a distinct arrogance much too indistinguishable from that personified in Obama.

The defiant arrogance, evident in both of these currently influential individuals, is a disconcerting heap of hubris that America’s present and future conscience must reject out of hand. Another prognosticating ego on the talking-head circuit is Nouriel Roubini, the self-proclaimed forecaster of doom, who improves his personal bank account by knocking capitalism and calling for more government intervention. Current and future taxpayers cannot afford to accommodate such egocentric thinking, from egocentric minds. When overwhelming egos audaciously preach anything, we should become very suspicious of the direction they profess to lead.

I am making a statement less on economic theory, than I am making an observation on the message our intuitive natures are very likely receiving, many of us at least - the Obama and Krugman recipe for a utopian Now is false. It is false for the Now, and it is false for the Future. We should be apprehensive and skeptical of all egocentric thinking. We should very much distrust assertions, articulate or otherwise, that emanate from well-understood egotism.

Weary taxpayers should demand leadership that does not ignore the burdens of tax increases, massive stimulus spending, and out-of-control deficit spending. They should also demand of the Krugmans of the world, why they have no solutions to the impossible debt load that will be confronting America in 10 to 12 years. Taxpayers are standing on the sidelines of a progressive parade sweeping the country with an ideology that is expanding government to redistribute wealth rather than enacting measures to stimulate its creation.

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Thursday, June 17, 2010

• What Congress Should Be Asking Of BP

Congress is performing its requisite role on the nation’s worst environmental disaster. Congressmen from both sides of the political divide attack BP with a certain resolute and earnest energy that plays well for the cameras, and may provide some traction with the folks back home. For the long term, this circus in Washington is actually dropping the ball on behalf of America.

Rep. Bart Stupak (D-Mich.), and Rep. Henry Waxman (D-Beverly Hills), led the charge with repeated accusations and other attempts to extract response from BP’s CEO, Tony Hayward. With his company’s stock trading at about $31, well below half of the high it once enjoyed, Hayward looked and acted lost and confused, as he deflected questions. The optics were also negative as he disavowed any knowledge of events that might have led to the calamity that killed 11 of his employees. Unfortunately for America, he provided nothing that could be used against him in any court of law.

It may be useful for Congress to become educated through these hearings and perhaps oversight bodies will be pressed to actually do their jobs in future, however, the nature of the questions serves little purpose toward ensuring the long term reparations that will inevitably need to be provided to all those who have really incurred losses on the gulf coast.

For purposes of grandstanding, Congress is getting itself stuck in macro details that in effect leave Hayward and his Board of Directors off the hook.

Here is the direction the Congressional questions should take and why:

The most critical element in the management of a corporation is the structure of its executive lines of command.

When a CEO issues instructions, missives, or policies, and re-structures the company, as he or she deems appropriate to implement plans to achieve the company’s mission, the line of command and its “walking papers,” are clearly delineated, stated and evident.

Whether such instructions are in writing or verbal, each senior manager is given direction and parameters. The trickle down process permeates the corporation, and unless there is abject incompetence, even in a quarter of a trillion dollar enterprise like BP, each employee from the CFO to the local technician knows his or her job. Each employee understands the scope of the decisions he or she can make.

This may sound obvious, however Congress it ignoring this critical reality as it discharges indignant shame toward BP. Stupak and his committee should delve into Tony Hayward’s decision and policy distribution process. The sub-committee should question how Hayward has actualized his leadership of one of the world’s largest corporations. Congress should pull evidence on how and how much responsibility has been delegated to each executive, and how the process is in turn pushed down the various lines of command.

With such facts in hand, the legal process can place responsibility on specific individuals who will not be able to pull a “Tony-Hayward-side-step” once the details are collected. If there has been willful negligence or worse, the specific details pertaining to the chain of command will become critical to extracting cash and compensation - through legal means. Knowledge on the decision process will provide Congress much clout that it currently doesn’t have. The information will provide legal recourse.

Congress will also need to make sure that along the path of assigning blame to specific employees, it doesn’t make the mistake of destroying a whole company. In most large corporations there are some bad apples. Even if the rot goes to the very top of the company including its Board of Directors, this rarely means the whole company is blamable or culpable.

Congress should take care that it does not destroy the world’s fourth largest refiner. There are countries like China waiting on the sidelines who would welcome a “fire sale” on BP’s assets, and who would welcome overnight expansion into the Gulf’s oil and gas reserves. Congressional and White House rhetoric should temper itself, and act with a little more command of common sense.

.... Read more!

Wednesday, June 16, 2010

• Is More Evidence On Obama’s Presidency Needed?

The Mainstream Media is tripping all over itself deciding how to not embarrass itself over the latest demonstrations of incompetence emanating from the Oval office. America not only elected a novice with absolutely no worthwhile experience in managing anything, other than giving a speech, but through its votes America also populated the White House with incompetent individuals.

American voters should have thought a little longer on the ramifications of hiring an apprentice President. Of course, the nature of an apprentice is to work under the wings of an expert, which makes what’s going in the Oval office rather understandable. There’s no one with talent or experience in running anything, who might take the President under his or her wing.

For a country built on the fruits and creativity of the entrepreneurial spirit, it remains stupefying that an administration voicing so much animosity toward business and the business ethos was ever elected. I noted before the election that the “Tells” were of grave concern. Now, well into this Administration’s ill-advised ramblings and mismanaged trampings through the complex corridors of the economy, foreign affairs and domestic affairs, the MSM finds itself looking for rationalizations.

The MSM is becoming creative in excusing the object of its sycophancy. For example, the New York times thinks Obama is not able to get emotional or “involved” because he is too “cool.” Hollywood thinks he should lose a little bit of his “cool,” and show more anger. Does America really think it elected a cool President? Does America really think anger is a way to find a solution? Such thinking is not only idiotic, but sadly for the country, it excuses someone incapable of making critical decisions. This has nothing to do with cool.

The decisions that have been required of the White House since the election have been significant, and have been plentiful. None have found decisive or thoughtful direction from the President. Instead, Obama took America on a left turn into healthcare, at a time when Americans were stuck in consternation over the loss of jobs.

America has elected a President who doesn’t even know what questions to ask, . . . of anyone. It elected someone who made more trips on Air Force One and made more speeches than any other President in his first year in office.

America does not expects a single individual to have all the answers, however America should expect the individual sitting in the revered Oval office to know enough to surround himself with people more talented than he, and of whom he can ask the tough questions, and to whom he can give very direct and specific marching orders. The electorate elected a fumbling Administration at a time when a tough manager was called for. The MSM is running out of rationalizations and excuses.
The evidence is in.

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Thursday, April 22, 2010

• End Our Intimate Relationship With Debt

American taxpayers are witnessing an unprecedented full-frontal attack on free enterprise, business, innovation, invention, creativity, productivity and entrepreneurialism. This is a misguided strategy from elected officials. At its core it is also an attack on employment.

We are provided a daily dose of news from Washington and from Wall Street’s experts that the economy is now in a phase of recovery, however we are told that this is a jobless recovery. "Jobless recovery" must be a new mantra concocted to perpetuate feel-good perceptions. There is little point in wasting anyone’s time analyzing this non-sense. For the millions of unemployed, and all the workers who will lose their jobs over the coming months, the economy is, and for the foreseeable future, will continue to be in a recession. This is not a glass-half-full attitude, but a lucid perception of the reality facing the road ahead for taxpayers, so let’s not sit and wait for answers from government. The actual number of unemployed is over 26 million. Where are we going?

As a result of this drawn out recession, and out of the undiminished American perseverance, a whole new wave of entrepreneurial ventures will spring up over the next five years. Washington has not been able to kill the entrepreneurial energy that created the millions of jobs in the first place, regardless how much it has tried. This remains enough of a "free" country that from the housewives in the suburbs struggling to feed their families, to the laid off office managers in the cities, individuals across America will rise to the challenge, and do something for themselves. They will take back whatever control over their own lives they might have relinquished to carelessness. Such is the nature of the human condition, as long as it does not allow itself to succumb to oppression, but holds the door open to fulfilling inspiration. America continues to be an environment where fulfillment at all levels is possible.

Out of the current stress and anxiety, will sprout a new collaborative entrepreneurship flowering through mutual inspiration and encouragement. The population’s negative reaction to “bigger, more expensive government,” that we have seen this past year, has not been an accident. While there will always be those who want to be “taken care of,” the vast majority of America has a natural desire to flourish and succeed without “big brother.” America also wants to see its government implement its laws with more diligence than has been demonstrated over the past twenty years.

Over the coming decade, the biggest change in perception that Americans will have to make will be in their relationship to debt. Debt has been very effectively promoted by banks and government, to the point where consumption of the conspicuous kind became a necessity for happiness.

Our general perception has been that debt is not only right, it is a right. Evermore lavish homes with equally lavish mortgages have become expectations, without which we have not achieved the unanimously accepted “dream.” How has such a perception translated to the national stage? It has become nationally acceptable that the U.S. government reach a state where it owes $13 trillion or a little under $120,000 per taxpayer. With an ever-increasing Federal budget deficit nearing $1.5 trillion, and no one seriously yelling stop, politicians have every right to think they have free reign to do as they please.

Washington knows and understands that perception is everything. Until the taxpayers decide otherwise, the White House and Congress will not implement restraints on the out-of-control spending.

The 110 million Americans paying income tax should lock out the grating noise of the propaganda machines lathering up their conscious minds with idiocies, and do what is right - Change perception on debt. Debt should be used when absolutely needed, rather than when desires have been stimulated into “wants.” Much of the national budget has been bloated by special interests, and by satisfying the personal wants of elected officials. A fraction of all government spending is needed. Demand a drastic cutback on that spending.

Debt has inflicted enough damage on the American landscape, and come very close to injuring the American psyche beyond recognition.

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Thursday, February 4, 2010

• Toyota Under Political Siege

Toyota’s has overnight passed through a political tunnel that has severely tarnished its image as the greatest automaker on the planet. With U.S. Transport Secretary Ray LaHood leading the attack, and Unions piling on, the Administration’s denials of nationalist impulses are transparent. The White House apparently believes that it is now appropriate to extend corporate bashing to foreign controlled companies. Attacking banks went over well with the fawning MSM, now that same media is jumping on the train and fueling passions against a company which directly or indirectly provides hundreds of thousands of jobs to North American taxpayers.

It is peculiar that the Administration and Congress, along with friendly members of the MSM, are attacking a well-run and successful Japanese company so aggressively, while giving a comparative pass to any Chinese company transgressions with millions of faulty and dangerous products distributed across America.

The answer appears to rest in the undue power and influence which the United Auto Workers (UAW) currently enjoys with Washington, and very directly with President Obama.

Mr. LaHood can pretend otherwise, but his “stop driving” Toyota comment had the intended consequences of directly affecting the perception of Toyota in the marketplace. Democratic California Congressman Henry Waxman found easy fodder with his accusations of misleading statements from Toyota as to the causes of the more serious vehicle incidents. Waxman is playing to the home crowd along with the UAW, in his chastisement of Toyota - the underlying reason being Toyota’s closure of a unionized plant in California. How can Waxman possibly believe he is being helpful to his constituents?

Laws and government oversight are in place to deal with managerial malfeasance when it comes to auto companies knowingly misleading the public, or selling vehicles it knows are faulty. Carmakers have in the past been guilty of such practices. There is no evidence here that Toyota has for years sold cars into the market that it knew were faulty. Should facts in time prove to the contrary, the executives responsible will endure the consequences. Engineering and manufacturing mistakes occur, and all auto companies have had to endure the damage that such events present. Although Toyota may be mishandling it’s PR response to the faulty accelerator pedals, given the facts as currently available, the company appears to be responding responsibly to a recall that will cost its international shareholders billions of dollars.

Toyota will survive and will continue to manufacture some of the best vehicles on the road. Current Washington attitudes toward business and industry, and now toward foreign owned businesses, however, presents an attitude that may prove very harmful in the short, mid and long term, to long lines of unemployed now reaching 17% levels. This calculated, aggressive and belligerent continuation of impugned inclination toward a significant, and otherwise pristine employer, should give us pause. Leadership in Washington is flailing in an ill-perceived wind of populism.

This Administration should come out strongly and audibly reversing its course, and it should reign in the misguided thrashing of a major North American employer.

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Thursday, January 21, 2010

• Policy Development By Panic

American taxpayers should not read anything into today’s stock market supposed reactions to the President's verbal and policy attacks on banks. Markets have little to do with realities of the broader world and its economics. The Presidential attacks, however, should be very troubling to taxpayers for more profound reasons.

Obama is vociferously attacking “risk taking,” that very human characteristic at the heart of America’s success. Observing his address, it is evidently something he doesn’t have a good grasp of. It is also very, very obvious that the President does not understand business, or economics, even at their simplest denominations. The economy and its future progress is very dependent on risk taking.

This post has written repeatedly against the abuse by Wall Street, and has called for the re-instatement of “the Glass-Steagall Act (except as it pertains to the Fed) that was for the most part repealed in 1999 eliminating the restrictions of affiliations between banks and “investment banks,” … and don’t listen to any bankers who tell you different with stories about diversification reducing risk, or banks being completely capable of regulating themselves.” There is no need for knight-on-horse-saving-the-day-grandstanding. Congress should restore the act, but in the meantime, we can sit back and enjoy the theatre as the President shows us how to distinguish market making from proprietary trading within the banks.

Obama’s rhetoric of new populist policies against banks, comes across as a simplistic attempt to flirt with what he thinks is Main Street’s perception of banks. This also smells of the disingenuous, given this Administration’s early actions during the “bailout” debacle, that gave so much credence, and amperage, to the too-big-to-fail idiocy. It obstinately, and uncomprehendingly, provided hundreds of billions for the creation of financial behemoths. No preconditions were established, nor were any strings attached to the money. Wall Street played with this Administration, as it did with the Bush Administration, and helped itself to taxpayer-borrowed cash. This President should be taught that failure, big or small, is part of the long road to both personal and business success.

Contrary to Obama’s claims, the financial meltdown was NOT caused by the reckless abandon of speculative bankers mired in greed. It was the direct result of cheap money from The Fed, being pushed onto consumers with little, or no credit, by a Congress, which believed in the mantra, “everyone should own a home.” If anything, we would like to hear about some reigning in of Fannie Mae and Freddie Mac, . . . just for starters. The greed which drove the likes of Goldman Sachs, Morgan Stanley and City Bank beyond the fringes of ethical boundaries was not the root cause of the disaster the world is now burdened with.

Obama’s attack on banks is a knee-jerk reaction in response to the devastating Democrat loss of the Massachusetts Senate seat this week. This breathes the fragrance of panic. The President evidently has no idea how to approach the most important concern on the minds of his constituents – stimulating the creation of jobs. He should stay away from teleprompters for a few weeks, and educate himself on the workings of businesses, and the economy. Then he should surround himself with advisors who have actually managed a wide variety of successful enterprises. The result should then be a speech, without teleprompter, impassionedly promoting American business and ingenuity to the national and international community.

What America will definitely not need is a lecture on what its core values should be.

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Thursday, January 14, 2010

• Nantucket’s Cape Wind Whips Up Hypocrisy

The Nantucket Massachusetts Cape Wind plans to built the first U.S. offshore wind park are blowing some toxic waste to the surface of the broad zeal to create “green” industries. These toxins are not of the materially harmful kind, but consist of all the pretentions at the core of too much human self-indulgence floating around the quagmire of the green energy movement.

The planned 130 wind turbine forest covering 24 sq. miles, which is intended to become a symbol of alternative energy on Horseshoe Shoal in Nantucket Sound, could also become an enormous subsidy magnet, sucking $731 million from taxpayers, before any long term costs are estimated. The “money” in such projects is in “building” these blights on the landscape, and then heading out of town because they have historically never proven to either work or be comparatively efficient when measured against other energy sources. Nevertheless, the irony of the Cape Wind debate rests in the reaction it has received from the wealthier Massachusetts residents, lead by the Kennedy family.

After the recent push from the White House and Congressional Democrats for Cap and Trade legislation, and for a Copenhagen Agreement, it is ironic that the Kennedy clan and its Massachusetts friends are campaigning against the Cape Wind project. It seems, quite justifiably, that the blue bloods don’t want any unsightly giant wind turbines disturbing their idyllic paradise, and would rather not have them distract from the expansive views visible from their oceanfront weekend mansions. The farm would be visible from Nantucket and Martha’s Vineyard. They are using the obviously suspect rationalizations for their dissenting views, including the concern for wildlife, and the danger to air and sea navigation. They would evidently be much happier if the windmills disadvantaged some other corner of the population, even as they profess support for them generally.

The hypocrisy here is that they can’t bring themselves to speak against the sham that is the building of windmill farms. The moneyed Massachusetts residents who have controlled that State’s politics for two generations cannot bring themselves to admit that this windmill project would be unviable, producing electricity at approximately twice the current wholesale prices (Minerals Management Service (MMS) Draft Environmental Impact Statement), or that such windmill farms are notoriously inconsistent, unreliable, and expensive to maintain. Currently the money is in building the farms, and not in their successful energy contribution to the grid over the long term.

There is ample evidence that such systems create cash sinks that do not benefit any progress toward renewable energy sources, which is now forcing Europeans to scale back on their windmill investments. Massachusetts blue bloods will rest self-righteously in the comfortable feint that advocating windmills plays to the politically correct, politically lucrative, and presently financially rewarding clean-energy movement, but, “Hide these windmills somewhere far away, and not in my backyard.”

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Wednesday, January 6, 2010

• America Waits For Leadership

How can history be an accurate record when the elusive present is being recorded as wild distortions of reality? The mainstream media’s (MSM) record of the White House, which it reflects onto the American perspective, as well as it’s flaccid ruminations on the Obama Administration, commemorate Napoleon’s, “history is the invention of historians.” Obama is failing in his duty to country, and the MSM refuses to acknowledge the evidence.

The word history comes to us from the Greek word historia, which means knowledge acquired by investigation. The White House press corps is the supreme example of the current Fourth Estate’s inability to analyze, question or investigate as it panders to a President who was given a mandate to affect change in Washington. History is being distorted as it is being written.

The expectations of the taxpayers have not materialized, and anticipations have given way to disappointments, yet the MSM cannot bring itself to raise any serious questions. It’s not as if opportunities to question don’t exist. Obama has given a speech each and every working day of every week of his administration. Research should prove that no President in history will have made as many speeches, yet the Nation is stuck in anticipation of substance.

The latest sampling of this President’s systemic tepid engagement in his job as America’s CEO, came in the form of an unenthusiastic tropical response to the attempted bombing of Northwest Flight 253. Evidently the managerial capacities required to direct an administration were not part of the Obama tool-set when he moved into the White House. The blight from the dearth of experience, and the entrenched ideology in his Cabinet and czar brigade, has been unveiling endless failings from the outset, and yet, Obama can’t dismiss the likes of incompetents such as Napolitano. Admitting a mistake of posting would be a sign of confidence, rather than one of insecurity.

Political debts of this Administration run deep. The billion dollars Obama raised to win the Presidency expect influence. He lost all objectivity and independence from such influence long before he moved into the White House. Unfortunately, such is the state of politics in Washington. With tingling in its legs, the MSM gives his failures a pass, and in doing so, it forsakes its responsibilities to American taxpayers. The media refuses to demand the most important and reasonable expectation of the population – it refuses to demand Leadership.

Obama has been hiding behind the teleprompter long enough, and should be confronted with the obvious, the first of which is his tiresome blaming of the Bush Administration to deflect all responsibility for the economic and security challenges of America.

Obama and the current Congress are responsible for the accelerated government growth and spending of the past year. They are intimately and directly responsible for disastrous and ill advised programs such as Cash for Clunkers, bailouts for the Too-Big-To-Fails, dishonest promotions of a two thousand page health care bill, inept indulgence of Wall Street, bold pandering to special interests, and the explosion of unemployment to over 17%.

This Administration appears to be ensconced in the belief that a broad and rapid expansion of government, and its insinuation into all walks of American life, is the answer to economic problems facing the Nation. To be allowed his ramp-up of government, Obama validated in Goldman Sachs, JP Morgan and their Wall Street friends, a right to abuse taxpayers through a confoundingly complex cash grab, and a purchase of unknown toxic assets. The Administration further succumbed to special interests by obliterating any calls for the return of Glass-Steagall. This White House is completely void of any understanding of the key drivers of the American way of life - the small to mid-sized businesses. It is also flailingly uninterested in genuinely furthering its own education on the subject. It has become evident that this President has no interest in fostering the encouragement and stimulation of the entrepreneurial spirit in America.

Obama also seems confused on the international front, having administered one misstep after another with perpetual miscues in his actions, and in the perceptions he leaves in his wake. The vexing list is rather embarrassingly extensive, and it includes everything from Obama’s extravagant bowing to a dictator, then to his doubling over to a king. At the other end of the perplexing-Obama-acts record is the snubbing slight of the Prime Minister of America’s biggest trading partner, Canada’s Stephen Harper. Harper was shown to a back door of the White House, and was received by an administrative minion since Obama was too “busy.”

More substantively, Obama extracted nothing from Russia when he reversed the proposed installation of a European missile defense system. Now Iran runs amok, with ample time to hide its nuclear fuel and uranium enrichment facilities. Hard sanctions on Iran? That would be a “hard” decision, very much in opposition to the appeasement strategy employed to date. Have we so soon forgotten the Administration’s condemnation of the constitutional removal of Manuel Zelaya, the Honduran, America hating, Hugo-Chavez supported despot? Given the MSM’s refusal to confront this President, we have also no doubt forgotten Obama’s appeasement, and offers of some engaging “rapprochement,” to the murderous Omar Hassan al-Bashir of Sudan and his homicidal regime.

There was broadly felt consternation with Obama’s response to the Fort Hood massacre, and dismay with the languid nature of his address to the cadets as he announced that he was sending 30,000 young men and women into Afghanistan. We have yet to hear a rationalization from the most powerful lawyer in America on the decision that may unravel his Presidency - enabling terrorist to Lawyer-Up. No matter how much earnestness the President now pretends to convey in his prepared addresses, he long ago lost any appearance of authenticity, and the authoritative was reduced to an eerily natural self-righteousness. The capping may have been the weak-minded, insecure and vain B+ self grading.

Some have accused Obama of dithering, particularly on concerns of international affairs and national security. “Dithering,” is a colorful term, but is inappropriate here. Obama is simply incapable and unqualified. He was given ample room to demonstrate the claims of his intelligence. Wasn’t he a professor with a law degree, after all? Didn’t he rouse audiences with a couple of lofty speeches that bordered on sermons during the campaign? Yes he did. And, . . . well, that’s it.

His detachment, and apparent lack of passion, was initially rationalized as “well, he’s listening and he’s thinking.” Now this insensibility surprises, even befuddles, a majority of the electorate that launched him into office. Whether or not he actually lacks passionate disposition toward his country is no longer relevant. Smart or not, is also irrelevant. He is not a leader, and that, he cannot, and will not change.

America still waits for promises of speeches, given during the most expensive Presidential campaign in history, to materialize into actions that will be positive for a Nation facing unprecedented debt, deficits and unemployment. Though it yearns for leadership, America now knows better than to anticipate it from this President, and knows that such misplaced hope is too disheartening.

While the MSM continues its fawning ways, America will look to the next Presidential election to find a strong and willful leader. America doesn’t want or expect to support all of its President’s policies, or decisions, or compromises, or appeasements, however, America wants to know it has a leader of integrity who is never in doubt, and who makes it proud. America wants a leader who takes decisive actions nationally and internationally. America wants, and deserves a leader who says, “I will not rest until, . . .” and then doesn’t jump onto Airforce One, heading off on another golfing trip, or other holiday, or other speech in another zip code.

One good piece of news: The vacuous promises of Hope and Change will be decidedly wiped from the lexicon of Presidential campaigns for at least one generation.

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