The Repugnant Nature of the Minimum Wage

This post has grown out of an entry that I posted at Red State here. I received some interesting comments on it at Red State, so I thought I would rework it and open the post up here for discussion. I introduced this entry at Red State as part of the "Red State Book Notes" project.

This weeks reading for the "book notes" included the chapter “Minimum Wage Laws” from Economics in One Lesson. If I had titled the chapter, I would have called it “The Evil-and-in-all-Ways-Morally-Repugnant Minimum Wage Law”. In the interest of full disclosure, I have always thought minimum wage laws violated the very concept of a free society. If I run a small business and work out a contract with an employee to work for me for $5 an hour, why does the federal government believe it is entitled to step in and tell me I must actually pay that person $7.25 an hour? This is a private transaction between two people.

However, we are told that by having a minimum wage we guarantee people make a just and decent “living wage”. But do they? As Hazlitt points out in this book:

The first thing that happens, for example, when a law is passed that no one shall be paid less than $106 for a forty-hour week is that no one who is not worth $106 a week to an employer will be employed at all. You cannot make a man worth a given amount by making it illegal for anyone to offer him anything less. You merely deprive him of the right to earn the amount that his abilities and situation would permit him to earn, while you deprive the community even of the moderate services that he is capable of rendering.

This makes perfect sense if you think the process through and ignore the typical political rhetoric. Let’s say you own a small business. Applicant A shows up for a job interview. While the person is nice enough, you quickly determine their labor isn't worth the $7.25 an hour to you. You won’t hire this person. You will wait until someone comes along that you believe is worth the $7.25. The federal law has made Applicant A unemployable.

The argument is sometimes put forward that we need a minimum wage law, or need to increase it because the gap between the “have’s” and the “have nots” has gotten too big. First, there is never any evidence put forward with this argument. Secondly, as the above shows, a federal minimum wage law will only make any gap there is that much larger. Finally, this gap never takes into account the increased living conditions of today’s “poor” versus their counterparts from 50 years ago.

When I originally posted this, I got a comment that minimum wage laws prevent industry from exploiting people. This argument assumes that individuals can’t take care of themselves. The supporters of minimum wage laws assume that someone working $5.00 and hour won’t leave to earn $5.25 an hour. It also assumes that only the government can prevent an employer from taking advantage of an individual. Our world is now so interconnected it’s easy to find out what employers pay. If you are worth more, you’ll find a job that pays more.

Finally, if you accept the theory behind the minimum wage law, then you must also accept the power of the federal government to decided a "maximum wage law", or a point above which you cannot be paid. If the government can legally set a price below which you cannot pay someone, why can’t it set the price above which you cannot pay someone? Further, since minimum wages apply to almost every industry, a "maximum wage" would as well. The maximum wage law has gotten some traction when it is suggested that it apply to companies that have taken bailout money. That is just a short skip from all companies.

A minimum wage law is just another instance of the federal government interfering in what should be private transactions between two people. You can wrap it up in the pretty argument of a “living” wage, or in “helping the poor”, but at the end of the day, its just the government sticking its nose into our private lives when they shouldn’t be there. It’s a failed attempt to legislate prosperity.

"What Will Democrats Do Now?"

That seemed to be the question I heard the most yesterday. With the election of a Republican to the blue state of Massachusetts, what will the Democrats do? Here are my thoughts on what Tuesday's election means.

No Obamacare This Year

The Senate Republicans seem to be doing a very good job of standing in the breach. With a 41st vote, the Republicans can stall any legislation as long as they want. The only way to pass Obamacare is through reconciliation or by the House adopting the Senate bill. Speaker Pelosi doesn't have the votes in the House, and reconciliation will strip the bill to the point that Reid may not even recognize it. There may still be health care reform this year. However, I think it will be very different from what we have seen so far.

"Moderate" Democrats Will look for the door.

There are two types of Democrats in the party today: Progressives and Democrats. Progressives are the true liberals of the party like Reid, Clinton, and Pelosi. "Moderate Democrats" or Democrats are the more main stream or even "blue dog" element of the party. The progressives have been telling the moderates for months now that they must pass health care reform or they won't get reelected in November. President Obama has told Democrats he will personally campaign from coast to coast for them after they pass health care. Today, moderate Democrats are looking at Massachusetts and thinking that Obama campaigned for Coakley and she lost. She lost in Massachusetts and she lost the independent voter by 3:1. They remember New Jersey and Virginia where Obama campaigned and the Democrat lost in both cases. In both cases independents voted for Republicans by a 2:1 margin. Career politicians see as job #1 getting reelected. President Obama doesn't have the shirt tails to give them the cover they need in November. Already Representative Anthony Weiner (D-NY) says health care reform has as much chance of passing as pigs flying out has butt. Democrats weren't talking like this before Tuesday. I think some Democrats will simply announce they aren't seeking reelection, others will start distancing themselves from Reid and Pelosi and may start voting against things like health care reform or cap and trade.

The Politicans will Begin to Listen

During the last twelve months, a number of Republicans and Democrats have participated in Tea Parties across the country. They have gone to their representatives office to complain. They have sent emails, letters, and phone calls telling the congressman or senator how to vote and what the voters thought. These people have been ignored. Many Democrats in Congress and the Senate simply believed the voters couldn't, or wouldn't, really do anything. Now Nelson has been run out of a restaurant for the first time in his political career by angry voters. A solidly blue state has elected a semi-conservative Republican who campaigned on fighting a Democratic President on his signature issue. I promise you a number of politicians are looking for ways to seem more responsive to voters. That's always a good thing.

Who cares if it isn't in the Constitution??

I found the following clip at the Heritage Foundation. This is a Democratic Senator from Hawaii being interviewed by CNS News. It's a rare instance where a politician gives an honest answer to a simple question, and it really should scare the hell out of everyone.

If the Constitution doesn't give Congress the power to do it, then they can't do it! The scariest part is were Senator Akaka says they should do this without Constitutional authority because they want,"...to help citizens in our country to live a good life."


If this doesn't scare you, then you don't understand what he just said. If you're a liberal or a Democrat, imagine a Congress with an overwhelming majority of conservative Christians passing legislation that has no Constitutional authority, but they want to do it so that the citizens live a good life. Would you tolerate that?

Dem's to pass Health Care without Republicans

Yesterday, Human Events online posted a story of how the Democratically controlled Congress is planning to pass health care reform without any Republicans, and maybe without more moderate Democrats, and without listening to the American public. According to Human Events:

House Ways & Means Committee Chairman Charlie Rangel (D-N.Y.) held a hearing [Thursday] morning to certify that H.R. 3200 -- the main House Obamacare bill which was the subject of all the town hall rage in August -- has met all requirements to pass as a “budget reconciliation” measure.

Under reconciliation, the bill can be passed by a simple majority vote in the Senate -- just 51 votes -- and will be given preferential treatment on the House floor as well. The Dems have apparently invoked the “nuclear option” to shut out Republicans and ensure the bill is passed before the end of the year.

During the certification, no amendments were allowed and no debate was allowed. Human Events goes on to point out that this bill is likely to be certified for reconciliation in the other committees it is currently being reviewed in. Human events says that Rangel told the ranking Republican on the committee that Rangel didn't want to invoke the nuclear option, but that the House leadership forced him to.

HR 3200 could be voted on in the House on the floor in the next two weeks. It would then be sent to the Senate where it would only require 51 votes to pass. Remember, HR 3200 is the bill many voters were outraged about before the recess. It would provide a public option, it would provide coverage for abortion, for illegal immigrants, and rationing of treatment. This bill would also include the "death panels", a board that would meet and decide whether or not to authorize treatment based on cost and life expectancy. You may not agree with the name, but the result would be the same. As President Obama told one town hall goer, towards the end of your life, "Maybe your not better off having the surgery, but taking painkillers." If that is your personal decision, so be it. You shouldn't have the government making that decision for you.


If HR 3200 is passed I can't imagine the President won't sign it into law. The bill won't take effect until 2013. Democrats don't want to face questions about this bill in the next Presidential election.

In a previous post, a reader of this site said,"...the [D]emocrats cannot just vote something into law based on numbers alone." It looks like the comment should have been passed along to the Democratic leadership, because I don't think they realized that.

A Lesson on Taxes and Spending

In preparation for this week's issue of "Of Government and Men", I wanted to recount this story about David Crockett. I have seen this story in a number of places, the version I am going to quote below is from Ted, White, and Blue by Ted Nugent. "The Nuge" in turn is quoting from The Life of Colonel David Crockett by Edward Sylvester Ellis. This story is about a lesson then Congressman David Crockett learned from a constituent. The story as quoted was in Crocket's words.

One evening, Congressman Crocket and a number of other elected officials were around the Capital when they noticed a large fire had broken out in Georgetown. They rushed to the scene and tried to lend their hand, but the damage was done. Crocket was distraught to see a number of families were now homeless, and had only the clothes on their back as a result of the fire. The next day, a bill was introduced appropriating $20,000 for the relief of the victims of this fire. Congress put aside all other business to rush this through, and they were quite proud of themselves at appropriating this money for those families.

The next summer, Crocket was back in his home district campaigning for re-election. He didn't expect any trouble, but thought it might be a good idea to feel out his constituents. He came across a farmer who was polite to him but very cold at the same time. The farmer told Crocket he had voted for him before, but wouldn't be voting for him again. Crocket was shocked and begged the man to tell him why. Eventually the farmer came back to the vote the previous year to appropriate $20,000 for the victims of the Georgetown fire. He asked Crocket if he had in fact voted for said $20,000 relief bill. Crocket said he had, and he was proud he had. Any nation as rich as ours could afford to give, "…the insignificant sum of $20,000 to relieve the suffering women and children, particularly with a full and over flowing treasury…" This was the problem. The farmer pointed out that Crocket either hadn't read the Constitution, or didn't understand it, and that his vote for this bill proved it. He pointed out that first, the government should only have enough money to cover it's legitimate purposes. The money in the treasury is taken from working families, so while Congress may feel good giving this money to families in need, what about the need of the families they took these funds from?

Secondly, the Constitution doesn't define charity. If Congress believes it has the right to donate to charity (as in this case) then there is no stopping the amount they may take from one family to give to another. Finally, the farmer pointed out, "Individual members may give as much of their own money as they please, but they have no right to touch a dollar of the public money for that purpose." The farmer stressed that the money Congress had appropriated for the relief of the fire victims wasn't Congress's money to give away. They should take up a collection of their personal money if they felt that passionately about it, but they shouldn't take from the treasury, and by extension, the other families of the nation to give to these families.

Crocket then says the following:

"I tell you I felt streaked. I saw if I should have opposition, and this man should go to talking and in that district I was a gone fawn-skin. I could not answer him, and the fact is, I was so fully convinced that he was right, I did not want to."

He finally asked the man to give him one more chance. Crocket promised to study and be guided by the Constitution. He hoped that if he ever voted for another bill such as the Georgetown fire bill, he would be shot dead. This is an important story from our nation's history, and one with lessons for today's Congress as it debates health care and other issues. Congressman David Crocket had his eyes opened to the meaning of the Constitution by talking to a constituent. I hope more of our members of Congress learn from their constituents during this recess, and that they realize that tax money isn't their money. It's the people's money and it should be treated with the respect it deserves.

Quick Notes: Comments, David Scott, and 9/11

It's been some time since I last wrote an issue of Quick Notes. However, I had a couple of topics I wanted to write about today, so I thought now as the perfect time for a new issue. Sit back and enjoy!


Comments. I've added a new widget on the right side of the blog (no pun intended). On the right side of your screen, about midway down, you should now see the most recent comments on Political Friends. Occasionally I get a comment about an older post that I would like everyone to see, so I thought this might be helpful. It is set to show the last five comments. Let me know what you think. Do you like it? Is it distracting? Would you like more or less comments? More or less details on those comments? Thanks ahead of time for any input you have.


David Scott's Courage. I am represented in the House by Congressman David Scott (D-GA). I have been trying to track down a town hall meeting I could attend to discuss health care with Mr. Scott. After his meltdown in front of a few constituents at the beginning of the month, he has been a little reluctant to appear at town halls. I have talked to Mr. Scott's office a number of times asking when he was having his health care town hall to hear from constituents. At first I was told it would be on August 28th and would be cosponsored by the AARP. However, as the clip above got more play, Mr. Scott backed down from this event. David Johnson of the Congressman's office said they were no longer having the event. He claimed that every venue they approached were worried about security issues. Apparently that wasn't the case.


State Representative Don Wix notes on his site that last week he attended, "...the townhall meeting in Austell sponsored by the AARP to hear from Congressman David Scott and to talk with local citizens about the pending healthcare legislation." I have to respectfully disagree with both Mr. Wix and Mr. Scott. When the event is an invitation only event sponsored by a friendly special interest group, it hardly qualifies as a "townhall" and I am not sure their goal was to hear from local citizens.

Special 9/11 Post. I volunteered Political Friends to join Project 2,996. This site is dedicated to remembering the victims of 9/11. I have been given a name I will write a special post about that day. If you have a blog or a site and want to participate, they still have plenty of names to assign, so go volunteer to help. I normally allow debate on here. I only moderate comments when they become insulting. For my 9/11 remembrance post, I will be very heavy on the moderate button. If you have anything political to say, don't do it on that post. I will include a reminder with the 9/11 post.

Of Government and Men: Term Limits

It is with an odd sense of fate that I begin this post. I scheduled weeks ago to write today regarding the need for term limits in both the U.S House of Representatives and the U. S. Senate. I had no way of knowing the Senator Kennedy would pass away this week and give me a perfect example of why term limits are needed.

The point of this post isn't to discuss Sen. Kennedy's politics. I instead want to focus on the length of his career. Ted Kennedy first entered the Senate in 1962 as the winner of a special election to replace his older brother John F Kennedy. When John Kennedy became President, he resigned his seat. A place holder was selected to replace President Kennedy and serve his term until 1) a special election could be held and 2) Ted Kennedy would be old enough to serve in office. That election occurred in November of 1962, and Ted Kennedy would hold that office until his death this past week. At the time of his death, Kennedy was the third longest serving Senator in the history of the U.S. Senate, serving a continuous 46, almost 47 years. For those trivia fans out there, Robert Byrd (D-WV) is the longest serving Senator in the History of the United States at over 50 years and counting. These careers can be measured in decades and that is a problem.

The U.S. Constitution does not include any limit on the number of terms a Senator or Representative can serve. Originally, there was no term limits for the President either. However, after FDR won four terms, the 22^nd Amendment was ratified, limiting the President to two terms, or ten years. There is no cap to how long a Representative or Senator can serve, as shown with Senators Kennedy and Byrd.

There are a number of groups and individuals out there looking to change this. Allowing Senators and Representatives to serve what can be life long careers in Congress can carry a number of disadvantages. First, the primary reason there are earmarks in congress is to provide incumbents with campaign items. A Senator can campaign in his home state saying, "Look at the money I brought back to this district from Washington." Second, one of the most heinous practices is gerrymandering voting districts. The only reason this is done is to guarantee that incumbents get reelected. Both parties practice this, and it could be done away with if representatives could only spend a certain number of terms in office. Many of the career representatives have begun to look at their position in Congress as "their seat" and not the property of the voters. Senator Kennedy's attempt to dictate who would replace him is a good example of this mentality.

Writing about the need for term limits, the Heritage Foundation noted a number of years ago:

"Term limits are needed at all levels of government. However, because of the large electoral advantages wielded by incumbents, the historically low rate of turnover, the greater threat from special interests, and the unique power that federal legislators hold, it is especially important to apply term limits to Congress."

While elected representatives will avoid passing term limits on their own, they have shown their hand before. Congress has instituted term limits on both the House and Senate Intelligence Committees. Why would they institute term limits on this committee? Our elected officials are worried that spending too long on these committees might cause the members to become more loyal to the committee and the intelligence bureaucracy and might lose their ability to exercise independent judgment on the committee. Couldn't we apply the same logic to Congress in general? If a Senator is in office for 40 years, does he still put the voters needs first?

Finally, in today's world, incumbents have some advantages that are very hard for a challenger to overcome that have nothing to do with policy and issues. Elected Senators and Representatives can campaign while continuing to draw their salary. Most challengers have to quit their job and campaign full time. Any speech or press release an incumbent issue gets covered in the media. A challenger has to spend money buying media time, which Congress has made more difficult for challengers through Campaign Finance Reform like McCain-Feingold. McCain-Feingold is much more about protecting incumbents than getting "the money out of politics". Like gerrymandering, this is an example of elected officials protecting their jobs, and not doing what is best for the voters.

I want to end this discussion with one final question. I mentioned earlier that the 22^nd Amendment was passed after FDR won his fourth term as President. He didn't serve out all four terms and was only actually in office for a little over twelve years. If Congress thinks it's a bad idea for one individual to serve 12 years as President, why is it a good idea for one individual to serve as Senator for 46 to 50 years?

Health Care Benefits for Congress

Patrick requested a few weeks ago that I dig into the benefits of our elected officials in Congress and the Senate. I do my best to honor requests from readers for different topics. Here is what I have found:

The first thing to remember is that Representatives and Senators are technically federal employees. As such, they get all the benefits of a typical federal employee, plus a few for being in the Legislature. Federal employees receive their salary and benefits from tax payer dollars. The starting salary for a member of Congress or the Senate is $174,000.00 per year, with the leaders of these bodies making more. In 2008, tax payers paid $15 Million to provide benefits for 8.5 Million federal employees. Obviously, this includes employees who aren't elected as well as those who are elected. Representatives are also covered from day one. There is no exemption for a preexisting condition, and there is no waiting period for enrollment.

Our elected officials also get a number of plans to choose from. The federal benefits site is a little tricky to navigate. It appears that members can decide between 10 to 12 plans, or any insurance plan available in their home state. The benefits site has a map that members can click on to see a list of the plans available. As with any insurance, there are monthly premiums. However, again remember since their salary is paid by tax dollars, so are these premiums.

One of the benefits Representatives and Senators have that other federal employees don't have is access to their own doctors and pharmacy. From a February 2008 issue of the St. Petersburg Times:

Members of Congress have their own pharmacy, right in the Capitol. They also have a team of doctors, technicians and nurses standing by in case something busts in a filibuster. They can get a physical exam, and X-ray or an electrocardiogram, without leaving work...These are optional perks that cost about $300 a month for House members and about $600 a month for Senators. Taxpayers kick in another $2-million.

And once again, the $300 to $600 a month is a payroll deduction, meaning its paid for with taxpayer dollars. As a final perk, the Stimulus package from President Obama adds an additional perk in for federal employees. I am not sure how this stimulates the economy, but quoting from the federal benefits site:

The American Reovery and Reinvestment Act (ARRA) of 2009, enacted February 17, 2009, provides a new health insurance opportunity for former employees who were or are involuntarily terminated between Septemeber 1, 2008, and December 31, 2009. Under this new law, former Federal employees may request premium assistance for thier temporary continuation of coverage (TCC) under the Federal Employees Health Benefits (FEHB) Program. Premium assistance means your former agency will make a Government contribution of 65 percent of the TCC premiums for your FEHB plan enrollment.

One Representative in Congress has refused health care coverage. In the recent bills that have been introduced, there have been a few mentions of forcing members of Congress and the Senate to switch to any public option they include in a final bill. So far, that has failed in House versions, and squeaked by in a Senate version. I would imagine it would be stripped if these bills made it to conference. Congressman John Fleming (Republican, Louisiana) has started a petition to get members of Congress enrolled in any health care insurance plan passed and signed into law. You can view his site and sign the petition here. Our Founders believed that members of the Legislature would be bound by any laws they passed, thereby giving them a stake in the effects of those laws. This was a good idea at the time, and an excellent one today. I will be convinced that our elected officials think the public option they include in a bill is a good thing when they are willing to force themselves into the bill.

Why the Rush to Change Health Insurance

As Health Care reform became more in doubt today, President Obama stuck to his guns insisting that both the Senate and the House pass Health Care reform by the August recess. With our economy continuing on a downward slope and with unemployment at 9.7% and expected to go higher, why the rush to spend huge amounts of money we don't have on health care reform?

The House Energy and Commerce Committee postponed voting on its version of health care reform indefinitely. They may pick it back up at a later date. However, Blue Dog Democrats have a large presence on the committee and they are concerned with how to pay for the health care reform the President is asking for. In testimony last week, the non-partisan Congressional Budget Office Director, Doug Elmendorf, stated that the various proposals from Congress would not reduce the cost of health care. Yet, President Obama has cited reducing health care costs as a primary reason for reforming health care. If the proposals now before Congress won't reduce our costs, why are we even considering them?

Various estimates have been done on the assorted health care plans and have predicted huge costs to the American taxpayer. Congress is debating a tax surcharge and taxes on health care insurance, both of which are equally noxious. There is some debate that neither of these proposals will pay for the changes Democrats are proposing. With this in mind, why are we rushing to implement these expensive change. We rushed the Stimulus plan through and it has been a failure. It has failed to stop unemployment, it has failed to spur growth in our economy, and it has failed to keep state and local governments from raising taxes. We were told we had to pass the Stimulus plan and we had to do it without debate.

I am not opposed to health care reform. I would like to see a system that includes tort reform, more options for individual insurance, insurance exchanges, and a tax incentive for individuals to buy their own insurance. I would like to see insurance companies allowed to sell insurance across state lines. I would like to see more interaction between individuals and their insurance companies and less face time between the insurance companies and government or employers. These issues need to be debated. On a large fundamental change to our life style like this, the American public needs a chance to read the bills in Congress before they are passed and they need time to weigh in with their representatives. If we rush health care reform through, I can guarantee it won't be right, it will cost much more than our economy can bare, and it still won't cover the people it needs to cover.

Can Congress Read?

"If every member pledged to not vote for {the health care bill} if they hadn't read it in its entirety, I think we would have very few votes."

-- House Majority Leader Steny Hoyer (D-MD)

This was Mr. Hoyer's response when asked about a petition being circulated asking House members to read everything they vote on. Mr. Hoyer believed the thought of members reading what they vote on was worth a few chuckles on camera. Quite often members and their staff don't read the bills they vote on. Some of this is laziness and some of it is due to the size and speed Congress now passes legislation. For example, the Stimulus Bill was 1,100 pages long (at a price of $787 Trillion) and members were given 13 hours to review the full bill before it passed. The Cap and Trade bill was 1,200 pages and had a 300 page amendment added at 3 AM the day it was voted on. The final version of the Cap and Trade bill didn't exist in written form when it passed the House. A printed copy of the U. S. Constitution is only about 10 pages long.

To be fair, this is not a Democrat only issue. The 108^th Congress, which was controlled by Republicans, passed 2,900 pages worth of legislation in a combined 48 hours (at the bargain price of slightly less than $1 Trillion). Both Republicans and Democrats have been embarrassed when provisions of these bills finally saw the light of day. Republicans were surprised to find their Ominbus spending bill included a provision to allow Republican leaders to review anyone's tax return they choose. Democrats outraged voters when it was discovered the Stimulus bill included provisions for AIG bonuses after the government bailed them out. After campaign finance reform passed in 2003, members had to hire experts to tell them exactly what was in the bill they just passed.

Most people would probably say this is a problem. President Obama campaigned on a 5 day period for bills to be posted on the internet and reviewed by the public. Conservative, liberal, and libertarian groups have all started petitions to get lawmakers to read what they vote on.

If bills are too long to read, they shouldn't be passed. If it can't be read in the time members get to debate it, they should take more time to review the bill. Our expectations of our representatives are so low, we wonder if we can make them read something that may tax us or our children. We give them a pass on legislation that may outlaw things we do, limit our freedoms, or may affect our children. In a reality, when they vote on something they haven't read, they abuse their power and insult their constituents. It isn't enough to read a summary a lobbyist puts in their hand. If they can't read the bill, why are they even there?

Democrats don't need Republicans

I first saw this add at Red State and I really enjoyed it. It points out something that voters need to remember between now and November 2010: The Democrats control all of it. Any legislation the Democrats want to pass, they can pass without a single Republican vote. They have enough votes to pass anything in the House and they have enough votes to stop a filibuster in the Senate.

Any laws they write can go to the President. If he signs it, they get it. Want higher taxes, cap and trade, government run health care, they can do it all without a single Republican vote.

Remember this in the coming weeks when they say Republicans are trying to stop them or the Republican Party is the "party of no". The only way Republicans can stop any bill is to win the support of the public. Any legislation the Democrats want to pass, they can pass without any Republican support.

Remember this the next time you here Democrats say that the Republicans are preventing them from doing what they want. The only thing that will stop Democrats is the fear of being held accountable for the laws they pass.

Why Do We Have CAFE Standards?

Last week President Obama had a major press conference to announce a proposed new national fuel economy standard for vehicles. This new standard will average out to around 35 miles per gallon. This new standard implements some policies from the Bush administration years ahead of their original target date and creates a national corporate average fuel economy, or CAFE, standard.

CAFE standards started in the late 70’s and were specifically targeted at passenger cars. At the time they were created to lessen our use of foreign oil. They have failed miserably with this goal. According to the Heritage Foundation, the US has increased its foreign oil consumption from 32 percent to 52 percent of oil used since the standards were adopted. The new time lines announced last week will affect the 2016 model year cars. These standards will require that all of a particular class of vehicles sold by any manufacture average out to meet the target miles per gallon. The footprint of the vehicle is the best way to think of the different classes. If Ford sales 1,000 cars in a certain footprint, those 1000 vehicles must average out to have the target fuel efficiency. If Ford sales a lot of cars with lower efficiency, then the other cars must have a much higher efficiency in order for the 1000 vehicles to average out to the required mandate.

There are trade offs to higher fuel economy. According to the Obama administration, the new national standards may add around $1300 to the purchase price of your vehicle. This is only an estimate, and some groups claim the real price is higher. There is also only so much fuel economy you can get from an engine. The rest has to made up by making the car lighter. The National Highway Traffic Safety Administration has expressed concerns that the lighter, more fuel efficient vehicles result in more fatalities every year. CAFE standards have resulted in an estimated 1,300 to 3,900 deaths per year, depending on the year and the source. Some environmentalists would argue that these deaths are acceptable if we lower the amount of pollutants discharged each year to help solve global warming. The truth is that CAFE standards won’t solve global warming. The next time you drive to work and see a convoy of tractor trailer trucks, or pass a construction site, remember those vehicles are exempted from CAFE standards due to their size. The CAFE mandate also argues against itself. The theory is that more fuel efficient vehicles reduce our need for oil and gas. In reality, fuel efficient vehicles make driving cheaper. Cheaper driving means more vacations, more car trips, and more gas used.

Personally I don’t think the government should be telling auto makers what fuel efficiency their vehicles must achieve. The government doesn't mandate XM radio (yet), why fuel efficiency? President Obama has never run a business, and I don’t believe there are any automotive engineers in Congress. The government should try to address other problems. Perhaps after the economy is fixed, the nuclear problems of Iran and North Korea are resolved, and terrorist stop trying to kill us I will change my mind. Until then, I think the government needs to keep its eyes on the ball, and stop worrying about whether my car gets 20, 30, or 40 miles per gallon.

Why I go to the Tea Parties

There have been a lot of comments on here and in an assortment of media outlets regarding the people who attend Tea Parties. Some of the worst comments are those like Jeanine Garofolo saying that Tea Party attendees are only protesting a black man being President. The racist comments are uncommon, but not as uncommon as they should be. What seems more prevalent is the belief that the Tea Parties are organized by Rush Limbaugh, Sean Hannity, Glenn Beck, and Fox News and that the goal is to overthrow the government. Anyone who says this hasn't spent any real time talking to those who attend the parties.

While kooks are often attracted to protests (both on the left and the right), the majority of people I have seen at the Tea Parties are there because they are upset by the spending going on in government right now. Many were mad at President Bush and the previous Congress for TARP and the bailouts of GM and Chrysler. They are also mad at President Obama and the current Congress for continuing these bailouts, and for the ever increasing budgets and spending programs. Many of the attendees realize there is no way to continue this level of spending without dramatically raising taxes on everyone. The chart below was published originally in the Washington Post, and has been researched and defended by the Heritage Foundation. It shows the deficit under President Bush and the projected deficit under President Obama.

Whether you believe the White House or the Congressional Budget Office, neither of the above estimates are good. The spending in Washington is way out of control. Every idea in Washington revolves around funding a program, spending money on research, or buying something. There are very few elected officials arguing to cut the budget, and not enough officials arguing to stop the bailouts (auto, credit, or bank). My biggest fear is that the bailouts are going to make things worse, not better. By propping up these industries, we are delaying the day they go through the reforms they need. As painful as those reforms are now, they are going to be much more painful down the road.

I go to the Tea Parties to protest the current levels of spending by our government. This includes President Obama's spending and Congresses spending. I am not there to protest just President Obama. If the protests were about Global Warming or some of the other silly idea's this administration has, I probably wouldn't attend. While these ideas are worthy of debate, and I do debate them here, they aren't as dangerous as the continued spending by Washington. If we continue on the pace the chart above shows, our economy is going to get so bad, cap and trade and national health care won't matter. I can't speak for everyone at the Tea Parties, only myself. I can say that many of the people that I have spoken with at these parties have the same concerns I do, and are worried about the same things. The Tax burden on the American Worker is already too high. Spending like we are seeing in Washington is going to make that tax burden much worse.

I also go to the Tea Parties because I don't believe it is the role of our government to do these things. I don't believe our government should bailout financial companies and car industries. I don't believe we should step in and fire private CEO's. I don't believe the government has a right to interfere in how business pays their employees. Every time the government interferes in these areas, all of our freedoms are diminished. Anytime the government is allowed to save a bank, or a car company, or to fire private employees, it represents a time when the government gets to take control of our lives. I think Americans would be much better off without the government telling them what to do. Do we need some boundaries for companies to operate within? Sure. Do we need the constant intervention created at the end of Bush's term and perpetuated under President Obama? Absolutely not.

As I said, I can't speak for every person at these Tea Parties. I can say most of them are every day Americans who work and send their kids to school. These Americans deserve our respect and they deserve to have their voice heard in Washington. I , and many of the Tea Party attendees, believe Republicans and Democrats have stopped listening to voters. That's not good for anyone.

This post was published at Tea Party Patriots and Political Friends.

Does Money Really Grow on Trees?

Our government has reached a point it may never be able to return from.

A few weeks ago I quoted an article from CNN Money. According to CNN, in 2008 our government allocated $7.2 Trillion in rescue funds for the failing economy. On Tuesday, President Obama signed the largest economic stimulus package in our nation's history. It carried with it a price tag of around $800 Billion. No one is sure just how much this bill will cost us over the next four or five years. President Obama signed this bill after demanding that congress act quickly. He said our economy is in a crisis and time can't be wasted. Congress violated the very bill it wrote, and passed the bill before any member of Congress or the Senate could read the bill. I want my readers to think about that for one minute. Congress voted on the largest stimulus bill in the history of our nation without actually reading the bill. President Obama then showed us how quickly it had to be passed by waiting four days to sign it. Congress could have waited the 48 hours the bill required before a vote and still had it to President Obama on Tuesday.

As the ink is drying on this terrible bill, President Obama is putting a new spending bill before the American public. Now he wants to take $75 Billion of tax payer money to prevent home foreclosures. The President says the housing crisis is unlike any we have ever known. While our economy is in bad shape, I'm still not sure this is the worst housing crisis in our history. If this money is so important, why didn't the President ask Congress to include this money in the economic stimulus plan? Maybe President Obama thinks there are money trees in the halls of congress that can just magically give him $75 Billion whenever he needs it. He spent less than one term there as a Senator, and part of the time he was there he was campaigning for President so he may not be that familiar with the Capitol building.

$7.2 Trillion in 2008. $800 Billion on Monday. Today another $75 Billon. GM and Chrysler need Billions more each to stay afloat.

Where does our government get this money? They get it from taxes. The government forces working Americans to give it money so that it can then waste it however it sees fit. These bills are all going to come due one day, and the American taxpayer is going to have to pay for it. President Obama now asks working people who may have a savings, and may have managed their money for a rainy day to pay for others who gambled that home prices would never go down. President Obama says this $75 Billion won't go to people who knew they couldn't afford the home they were buying. He says it won't go to lenders who tried to profit off of others. How can he prevent that? There is no way to qualify that in a federal bailout.

President Obama has done alot in 30 days. It will take years to fix the damage he and his Democratic Congress has done. If he doesn't stop his runaway spending, our country may never be able to undo this.

Transparency in Government?

Didn't President Obama campaign on a new era of transparency in Government? It seems like that era has already come and gone. The more the American people hear about the economic stimulus plan and it's comprimise, the more they don't like it.

You may argue that this isn't President Obama preventing the American public from reading the bill. It is at his urging that the Democrats are trying to push this through so quickly. I am convinced the Democrats konw the public doesn't like this bill. They are trying to pass it inspite of the fact that we don't like it!

Sit back and think about this for a minute. From the time the compromise bill was made avalialbe to the public (late last night) to when the House and the Senate will vote on it will be less than 24 hours. Already Congress has violated this bill. What makes you think they won't violate the rest of it? And if none of our representatives (Republican or Democrat) have time to read the bill they are going to vote on, how can they not violate it?

More Surprises from the "Stimulus" Package

If you are supporting the Democratic Spending Bill before the House and Senate, perhaps this paragraph from Bloomberg (authors Mark Pittman and Bob Ivry) will make you think twice:


The stimulus package the U.S. Congress is completing would raise the government’s commitment to solving the financial crisis to $9.7 trillion, enough to pay off more than 90 percent of the nation’s home mortgages.


I hope you read that very carefully. The money involved would pay off more than 90 percent of all home mortgages, not just troubled ones. I have written a number of times regarding the insane cost of these plans. However, another Bloomberg author has found another reason to oppose these plans. Betsy McCaughey explains that the stimulus package, as currently debated, will usher in a new world for you and your health care.


In her article, Mrs McCaughey references the exact page number each of these provisions are contained in. For brevity, I have not reproduced the page number. To start with, the stimulus package with digitize your medical records. This sounds innocent enough and is even billed as a way to save your life if you are traveling and need medical attention. The doctor will have access to your medical records via a federal website. Assuming you are confident these records are secure, and there can't be any breach at the federal level, we will continue on. If this worries you, don't read any more because the rest of this will terrify you.


Now that your medical records belong to the federal government, a new entity called "The National Coordinator of Health Information Technology" will begin reviewing your files and the treatment your doctor provides to ensure that your doctor is doing what the federal government deems appropriate. If your doctor isn't, and is trying to treat your specific circumstance, or is trying some sort of experimental treatment on you (even with your consent) then your doctor can face very serious repercussions. The exact language of the bill is vague on this, and will create a separate federal group to decide what that penalty is. According to Mrs. McCaughey, most of these recommendations are out of recent Health and Human Services nominee, and non-tax paying Democrat, Tom Daschle's book. In his book, Daschle says our health care should be more like Europeans. We should slow down the development of new drugs and experimental treatments because they simply cost to much. We should also be willing to accept "hopeless diagnosis". In laymen terms this means if it costs to much to keep you alive, the doctor shouldn't be doing it. To quote the article:


Daschle says health-care reform “will not be pain free.” Seniors should be more accepting of the conditions that come with age instead of treating them. That means the elderly will bear the brunt

Medicare now pays for treatments deemed safe and effective. The stimulus bill would change that and apply a cost- effectiveness standard set by the Federal Council (464).


If the stimulus package is signed into law, then a person and council named by the Democrats will decide what treatments you should or shouldn't receive, will be able to penalize your doctor or hospital for not following those treatments, and will decide how much it should cost to keep you or a loved one alive. If it costs too much you shouldn't get the treatment.


Consider this fact from Mrs. McCaughey: the bill provides more funding for these provisions than for the Army, Navy, Air Force, and Marince Corp combined.


You may believe this new Health Care system should be implemented. I think it will be a dark day in our country if it ever happens. I also believe our country could be permanently damaged by this. However, either way, it should outrage all Americans that the Democrats and President Obama are trying to sneak this in. This shows that Nancy Pelosi, Harry Reid, and Barack Obama know the American people will not support it. The Democrats control the House, the Senate, and the Presidency. If they really thought Americans wanted this, they would create a separate bill and pass it. The Republicans would be powerless to stop it.

I encourage you to contact your Senator and tell them to vote against this. Ask them to defend these Health Care provisions to you and explain why they support them. If you don't know their contact info, look it up here. Don't let them sneak in legislation that could affect how, and how long, you and your loved ones live.

Why An Economic Stimulus is Bad

It seems like all I am writing about now is the economy. However, I believe that the economy, and our response to it, can greatly determine where our country goes. I also feel like President Bush, President Elect Obama, and the Republicans and Democrats in Congress and the Senate are making poor choices with our money.


Glenn Beck had a great analogy on his show today. Any errors I make in retelling it are purely my own. I am going to paraphrase his argument. Glenn Beck points out what our leaders in Washington are saying: they don't know how to fix the economy, they aren't sure about the stimulus pacakage, but we have to do something. Mr. Beck says to imagine that our economy is a patient at a hospital. The patient is very sick, and the doctor isn't sure exactly what is going wrong. In order to save the patient, the doctor feels he has to do something. He starts using different experimental treatments much like the different stimulus packages are experimental ways to fix our economy. The more drugs the doctor tries, the more sick the patient becomes. Finally the doctor comes to the family and says, "We have to do something, so we are going to give him the biggest dose of the same experimental drug we have been using and we'll see what happens." What do you think the family would say?


Our economy is like that. As I noted in a recent post, CNN says we have allocated $7.2 trillion in economic stimulus packages. So far, our economy has continued into a recession. The patient hasn't shown signs of improvements. We shouldn't try the same drugs. We need a different solution.


The answer is to make our country the most competitive country in the nation for business. We need to lower our corporate tax rates to the lowest in the developed world, and maybe lower them some more. We need to cut taxes on investors and encourage them to invest and create jobs. We need to structure our economy so that any business that wants to survive the storm comes to our shores.

Of Cars and Bailouts

I once heard Joss Whedon discuss the themes of his Buffy the Vampire Slayer series. He said that the one lesson he tried to explore through the entire series was that our choices have consequences. This is a lesson managers of GM, Ford, and Chrysler, as well as Congress and the UAW would do well to learn. Upper Management at GM, Ford, Chrysler, and the UAW are all begging Congress for a bailout. They are looking for a loan of around $50 Billion in addition to the $25 Billion Congress has already made available for them in the form of loans for changing equipment at their factories.

I own a GM vehicle. Today I received an email from GM asking me to contact my representatives and ask them to vote for a bailout package for the auto industry. It is important to point out, there are a number of car manufacturers here in the United States that aren't looking for a hand out, and don't want their competitors getting tax money these better run factories have paid to the government. I think they have a good point.

GM, Ford, and Chrysler aren't looking to change their practices. They are looking for free money. Imagine if a company came to your house one night and asked to borrow money from you because they were on hard times. The company had a history of not turning a profit, said it stood behind its management team and their decisions, insisted on making no major changes to their operations, and wanted you to give them $75 Billion to let them keep their doors open for a few months. What would you say?

Some have argued that the big three are in this situation because of the Unions. I agree that the UAW has some share of the blame, but so does Congress, and the car manufacturers themselves. Congress has long believed they are automotive engineers and have mandated an assortment of standards that they themselves probably can't explain how to obtain. Congress is good at throwing money at problems, but not so good at coming up with real solutions.

George Will points out today that there is a very good solution for these automakers: Bankruptcy. The companies would be forced to restructure and reorganize. They would be able to renegotiate the bad contracts they have currently have with labor. As Mr. Will points out people who have retired from these companies, but are too young for Medicare, might lose their health insurance. That is OK. If they are that young, they can probably find new work. Some argue these automakers are too big to fail. Mr. Will points out they have already failed. The thing to do now is to see if the auto makers can restructure their company for success.

A Terrible, Terrible Decision by Our Government

Something has been bothering me the last few days, and I have decided to use this forum to get it off my chest. Our government passed a $700 Billion economic bail out package last week. We were told last week that the government had to do something. Some members of the House who voted against the plan on Monday, justified their vote on Friday by saying, "Things are bad, and we can't sit by and do nothing, so I am voting for this plan I don't like." Let's put aside the millions of dollars of earmarks (bribes?) that were associated with this bill. This logic is terrible because there are more than the two options of (a) do nothing, and (b) pass a bill that is so large, I can't even consider the amount of money it encompasses.

The "funny" thing about this is we were told we had to pass this bill. The Senate passed it, the House passed it, and the President signed it. Both Presidential candidates voted for it. The market, however, seems to have other ideas. The market tanked on Friday, and tanked again today. The market closed just below 10,000 points for the first time in a long time.

We are now being told that these things take time. The market will respond over the course of the next few weeks. We are also being told that the government has to take its time when using this $700 Billion so they don't abuse it and don't misuse it. What happened to "we have to do something now?" What happened to "we were going to see a crisis if Congress didn't act"?

The truth of the matter is there was always the (c) option. This option entailed looking at other options that might fix this situation without costing $700 Billion. This option entailed taking time to examine the situation, examine the failures of Freddie Mac and Fannie Mae, and then proceed with that knowledge and with the caution this situation required.

However, this is an election year. Obama and McCain have now both showed that nothing trumps looking like you're doing something in an election year. Most Representatives and Senators have done the same thing. Political commentators that I admire spent last week arguing that something needed to be done so that this won't be saddled on their presidential candidate.

For the first time I can think of, I am truly mad at my government. I honestly believe our government got it wrong last week. Getting it wrong if you think you are doing the right thing is one thing. Getting it wrong with the intent to simply win an election is an entirely different can of worms.

Over the next few weeks, I will be adjusting a few things. We have reached a point where more seems to be required of me and like minded individuals. I don't know what my new course of action will be, but I am going to chart a new one. This blog will continue to be a forum for open, honest, political debate. However, I will be getting more active somehow, and I will be bringing my readers along on the journey.

Government 101 – Me and My Soap box

I have been spending some time this week reading up on the economic crisis. I have been struggling with the question of if I believe our Congress should give the Executive branch a $700 Billion check. Proponents say if we don't do it, then our economy (and the economy of the rest of the world) will collapse. Opponents say that bailing out the market is irresponsible, will saddle taxpayers with a huge debt, will devalue our dollar further (thus hurting our economy and the world's), and may not fix the problem. Some have argued for other solutions such as suspending the capital gains tax for two years. They argue that there is private capital out there waiting for the right price to jump in. Warren Buffets infusion to the market of $5 Billion yesterday sure seems to give this argument some weight. What is the right answer? Honestly, I think all of the arguments have their strong points and their weak points. The bailout check would be used to buy up bad mortgages. Managed correctly (which I don't know if the government can do) this could actually return a profit to the government and to taxpayers. I am always a fan of removing taxes and getting private capital flowing, but is suspending the capital gains tax for two years enough to get that money moving? If we have learned nothing from the Great Depression, we should have learned two lessons. First, business and the market hate uncertainty. It scares them. Businesses will hold on to money, and not invest, until they are sure what the government plans to do. Second, passing laws just to pass laws can sometimes make matters worse. What if giving the Fed's a $700 billion check simply delays a much worse crash?

My wife made me watch Glenn Beck last night. If you didn't see it, you should go look for it on CNN or YouTube. I found the transcript for the show here. If I am recommending you view a CNN program, you really should sit up and take note. Glenn Beck had former Shell Oil executive John Hofmeister on and asked viewers to call in to ask any question they wanted of Mr. Hofmeister. Mr. Hofmeister has a new organization called Citizens for Affordable Energy. While watching that episode, and talking to my wife about the economic crisis and the energy crisis I realized we haven't come up with the correct solution yet because we haven't asked the right question yet. The right question is: When are we going to start legislating like adults, and not like children who just want to feel good?

Go look for articles on the economic crisis. Most of them blame it on the "Sub prime mortgages" or "bad mortgages" or "questionable lending". This is code speak for "loans that were given to people who should have never gotten a loan in the first place." Congress encouraged / forced banks to give loans to people who wouldn't have qualified for them. They did it under the guise of "making homes affordable for everyone." This is the problem. Any sane adult should be able to take a step back and look at the world and realize there are people in this world who will never be able to afford a home. There are charities that have as their goal fixing this. This is a noble goal. However, it isn't a realistic one, and it isn't one our government should be legislating to fix.

Another example is Polar Bears. How? Simple. Recently our government, under the evil George Bush, placed Polar Bears on the threatened species list. Bear in mind (no pun intended) that the worldwide Polar bear populations are at a high point. There are now more Polar Bears in the world than at any point in the twentieth century. Why did they get placed on the threatened species list? Because it "felt good".

We can't drill in water closer than 50 to 100 miles from our shores. Even though the most productive oil rigs are within the 50 mile mark, congress has decided we shouldn't drill there. Why? Sun bathers don't like to see oil rigs. What if there is an accident? Who will protect the birds? The safety record of the oil industry is actually pretty impressive. You have heard of a few spills, but by and large, oil is moved around this country every day and the only time we hear about it is when our gas prices go up. For those of you who think we can get rid of oil and replace it with solar or wind power, you are living in a pipe dream. If you think political environmentalist are going to let you construct wind and solar energy "plants" you haven't been paying attention. Already there are concerns with wind mills killing migratory birds. Sane adults can pass a comprehensive energy plan that uses oil, coal, nuclear, solar, wind, hydro and anything else we can safely squeeze energy out of.

What about our tax code? Here is a colossal waste. We have a cumbersome tax code that is designed to make the wealthiest people in the United States give their money to the "poor". Think Robin Hood with a gun and the federal government. We don't tax business and individuals to keep the government running and for the government to do those things the Constitution gives it power to do. We tax to try and earn votes, and because it "feels good" to stick it to the wealthy and to Big Business. What this really does is to drive businesses over seas and to take money from the people who might be able to bail us out of our current financial troubles.

I have great faith in the American people. At some point, Americans are going to wake up and tell their representatives to start passing laws like adults and not like 60's era hippies. When that happens, you will see a real energy policy, a tax code that makes sense, and as Glenn Beck would say, the few surviving hippies running for the hills while the rest of us chase them there with torches, cell phones, and SUV's.