Thursday, October 30, 2014

"Money in Politics and Free Speech"

                                 Sydney M. Williams

Thought of the Day
“Money in Politics and Free Speech”
October 30, 2014

With midterm elections just days away, it is worth considering money in politics and attempts to curb speech. Both Parties want money out of politics…but only that which flows to the other. There has been no Court decision in recent times that has upset Democrats so much as Citizen’s United in 2010. The irony is that their reasoning is illiberal. Their objection had to do with the fact that the Court considers corporations to be similar to unions and other political entities. Democrats, naturally, see nothing wrong with public sector unions feeding the machine that is essentially collusion between those unions and favored politicians – jobs for votes and money.

According to the FEC (Federal Election Committee), $5.3 billion was spent in 2012 on federal elections, double what had been spent a decade earlier – a rate of increase that is roughly triple the rate of inflation. Numerous attempts to curtail spending on elections have failed. Placing limits on spending inevitably favor incumbents – individuals, supported by taxpayers, over whom they exercise power and from whom they are increasingly alienated.

More importantly, when we rue the amount of money spent on political campaigns we unwittingly support efforts to curtail speech. Certainly we do not want the process to become any more corrupted than it already is, but that is why we have federal anti-bribery laws that prohibit quid pro quo dealings between officeholders and donors. If anything, existing rules should be enforced more aggressively. Congress should mandate full disclosure of all contributors that donate to political campaigns, including those to PACs and so-called “dark pools.” That would make it easier for federal attorneys to prosecute incidences of political bribery, and would have the secondary, beneficial consequences of providing greater transparency and would likely reduce overall campaign spending.

I may think George Soros is foolish and mistaken in his political beliefs (which I do), but he has every right to spend his money as he wishes. In like manner, the Koch brothers have every right to express their opinions.  When Senator Harry Reid refers to them as “un-American,” it is he who is acting un-American, as he seeks to bend the Constitution in his favor.

The effect of this brouhaha has been to raise the spectre of limiting speech. Like most federal bureaucracies, the FEC has been expanding its reach. Recently Vice Chairperson Ann Ravel announced her intent to forge new rules regarding on-line political speech. Under current rules, any political content that is not posted on-line for a fee is not subject to regulation. However, half the six members of the FEC wish to subject all blogs and internet postings, with political content (presumably including this one), to FEC-mandated controls.

This attempt to undermine the First Amendment is not limited to the FEC. In September, Senate Democrats failed in an attempt to pass a bill that would have amended the Constitution by allowing Congress to regulate campaign finance reform. The measure failed to clear a 60-vote threshold, but nevertheless garnered 54 votes to 42 against. The vote was a sham. Harry Reid and his cohorts knew they would never get the sixty votes, but they wanted an excuse to slam Republicans as protecting the Koch brothers. It was not only shameless; it displayed ignorance and unconcern regarding the basic right of Americans to freely express their opinions.

Wisconsin, once home to the infamous Republican Senator Joseph McCarthy, is now giving rise to “Chisholmism.” Democrat Milwaukee County district attorney John Chisholm conducted pre-dawn raids on homes of Republicans. He was looking for links between Governor Scott Walker’s campaign and conservative advocacy groups. He found none. Republican Governor Scott Walker’s battle with unions to rein in public-sector pension costs, which threatened to bankrupt the state, upset many, especially Democrats. Mr. Chisholm sees his duty to be the defeat of Mr. Walker in next week’s election. Is that the appropriate role of a district attorney? While a federal judge has stopped Mr. Chisholm’s “John Doe home invasions,” the effect has been chilling and intimidating on conservatives.

Freedom is almost always lost slowly. It slips its mooring based on the promise that government will make our lives easier and richer. We see its disappearance in myriad ways, but especially in rising dependency. “The United States is the only country,” according to the 2014 Index of Economic Freedom, “to have recorded a loss of economic freedom each of the past seven years.” Freedom is elusive and is almost always best appreciated by those who lost it or never had it. It is impossible to put a price on freedom. It is hard to define, but recognizable when lost.  Once the majority of citizens become net recipients of government largesse, it becomes very difficult to cut or even reduce government spending that accrues to their benefit.

Those who would deny our freedoms use words that are seductive. This has always been true from Nazis, Fascists to Communists. Their phrases are couched in expressions of concern for the poor and disadvantaged and in the suggestions that they (government) bravely take on the dragon that is the rich and the favored. Their deeds, however, were quite different.

Money will never come out of politics, but we should know who has given how much and to whom, whether directly or indirectly through a PAC or a 501 (c) (4) advocacy group. There should be no “dark pools.” No one should be fearful of speaking out, but those who do should take responsibility for what they say and for whom they advocate.

Our government has grown in complexity as it has grown in size. That is unavoidable, for we are a large, multiplex society composed of thousands of interest groups and millions of people with myriad opinions. The ability to communicate has never been easier, thanks to the internet. A politician or a government that is not transparent is going to get called out, whereas in the past what happened in Washington often stayed in Washington. Now organizations like OpentheBooks.com and OpenSecrets.org, along with bloggers and the internet, have helped lift the veils that cover political corruption. This gives discomfort to those in government who have always protected their benefactors.

Transparency and sunlight are better. It isn’t money that is wrong with elections. It is the attempt to muzzle dissent and voter fraud (a subject for another day) that should concern us all.





Monday, October 27, 2014

"A War on Women"

                 Sydney M. Williams

Thought of the Day
“A War on Women”
October 27, 2014

Why is it that Democrats see Republican women, especially those in public life, as not women? The answer has to do with the fact that to Democrats those women don’t meet their preconceptions as to what a woman should be. To a Democrat, a woman politician who does not see other women as “victims,” and who does not first proclaim for abortion rights and gender equality, fails to meet their test, no matter her opinion on other issues. But Democrats’ insistence that Republicans are at war with women also suggests a politically correct world that is unraveling.

“Desperate times call for desperate measures,” is a truism, in politics as well as in war. With Democrats facing headwinds, such as scandals, a dysfunctional foreign policy, an underemployed labor force, increased income inequality and an Ebola scare, all of which result from incompetency in the White House and a mendacious Senate leader to whom the ends are worth whatever the means entail. Democrats are desperate to find any policy that might incite their side. The result is the fictitious accusation that Republicans have declared “war” on women. Senator Mark Udall of Colorado has pushed so hard on this issue, he is now known as Senator “Mark Uterus.”

Nevertheless, I believe most Democrats, in spite of the priggish and condescending way they sometimes come across, are perfectly normal – perhaps a little foolish, but not paranoid, as are so many of their political leaders. I have many Democrat friends who are civil and reasonable. Most acknowledge that women are as intelligent and capable as men, and don’t need the pampering some politicians believe they require. Most recognize and, in fact, applaud those unique characteristics that make women different than men. It is when politicians make up issues about gender inequality that my Democrat friends begin to sound defensive, dated and, frankly, idiotic.

Republicans are more likely to look past the gender (as well as color and race) to the individual. When a Republican woman is elected to public office it has nothing to do with her womanhood and everything to do with her ideas. Not so with Democrats, where gender comes first. Using the analogy of a book, it is the cover that interests Democrats, not the contents. And, it is not just women they patronize; it is anyone who can be portrayed as a victim – gays, Hispanics, African-Americans, as well as women.

From President Obama to Hillary Clinton, from Harry Reid to Nancy Pelosi, Democrats have claimed that Republicans have declared war on women. There are, however, some women who would beg to disagree, and who are running for Congress as Republicans. Elise Stefanik of upstate New York would, at age 30, become the youngest woman ever elected to the House of Representatives. This Harvard graduate is running on a platform of lower taxes, less regulation and a foreign policy based on strength. Mia Love is an African-American running for Congress in Utah. She is up by nine points. A working mother and conservative, Barbara Comstock is leading in a House race in Virginia. Melinda Garcia, another Harvard educated young woman is vying for one of the two House seats in New Hampshire. And Jodi Ernst, a colonel in the National Guard, is in a tight race for the U.S. Senate in Iowa.

These women are unabashedly conservative, and gender is not used as an issue. The only war they see is the one being waged by their Democrat opponents. And most are running against men.

Political correctness will, at some point, do in Democrats. It blinds them to the natural differences between people and causes them to ignore changes that have taken place over the past couple of generations. If Democrats admitted success with Civil and Women’s Rights it would deprive them of an issue. Women have adapted to a world that didn’t exist when older, white, stale Democrat men like Harry Reid were in their prime. This is also true of the African-American community. While Jesse Jackson, Al Sharpton and Van Jones would have you believe that nothing has changed since 1964, in fact it has. Fear of losing personal power is the reason they trivialize Supreme Court Justice Clarence Thomas, or demonize conservative columnist Thomas Sowell. Neither fits their concept of the way African-American men and women should behave. Condoleezza Rice was never admired by those on the Left, as the first African-American woman to become Secretary of State, because she did not meet their preconceived notions. Worse, she was appointed by a President they love to hate and whom they label a misogynist.

Did any of the twenty-three Republican women members of Congress get their position because they were women? Of course not; they won because they successfully campaigned on ideas. Did Susana Martinez become the first female Hispanic governor in U.S. history because she is a woman and Hispanic? No, she did it because of her talents as a prosecutor and her hard-fought gubernatorial primary in 2010.

What is true in the United States is so across nations. Conservative women campaign on real issues. They are unafraid to tackle man in his lair. Margaret Thatcher did not run as a woman; she ran as a Conservative with powerful ideas. Golda Meir did not claim womanhood as her right to become Prime Minister of Israel. It was because of her opinions and the respect she earned as an individual. David Ben-Gurion may have been sexist when he called Ms. Meir “the best man in the government,” but it was a compliment. Angela Merkel did not become Chancellor of Germany because she was a woman; she did so because voters decided she was the best person for the job.

“I feel your pain,” may be a sensitive prescription for a candidate to express, but it can also be condescending. Empathy is a wonderful characteristic, but when it is expressed in an obviously political manner it is supercilious. Even the recipient must recognize the hypocrisy.


Democrats have conceived a “war on women” because they see it as a means to an end – victory on November 4th. Women are not so easily fooled. Stupid is as stupid does. The only “War” being waged is the one by Democrats against Republican women running for office.

Thursday, October 23, 2014

"Inequality and an Ideology All My Own"


                               Sydney M. Williams

Thought of the Day
“Inequality and an Ideology All My Own”
October 23, 2014

I have trouble with political labels. I understand they are convenient for political reasons, but they miss the essence of the individual. Compartmentalization works to the advantage of politicians, pollsters and the media, and fits a nation sickened with attention deficit disorder. Instant messaging and Twitter feeds are the way we communicate. Interviews are relayed to viewers in sound bites, designed to fit the political philosophy of the cable station or network running them. Political ads run thirty seconds. Since the principal goal of a political candidate is to get elected, he or she would rather mimic the polls. The last thing any politician wants to do is explain a complex situation that requires thought and reason. Either they don’t understand the problem, or they believe we are incapable.

As humans, we are complex. After almost seven years of writing this column, I thought it useful to more fully explain my beliefs regarding inequality. I get pegged and boxed like everyone else. Some may be surprised; others not, but in fairness I thought this digression worthwhile.

The question of equality is on everyone’s mind. My belief is that the world is Schumpeterian. Change is always with us, and for the most part, the new and the better knock off the old and less viable. There are obvious exceptions, but, on balance, change is healthy. There are times when change is slow and other times when it is revolutionary. We are living through one of the latter periods. But change is also destabilizing. It puts at risk, as do all evolutionary forces, those least capable of adapting.

Inequality is our natural state. There have always been utopian dreamers who have sought a world that was totally equitable. But men and women differ intellectually, physically, emotionally and in their character and aspirations. Some are diligent and hard working; others are careless and lazy. Cynically, both Communism and Nazism promised redistributive equality, but obviously delivered something far different, including oppression and forced inequality.

Our nation was founded with the principle of equality under the law, which is a right, and with the promise of equality of opportunity, which is a worthy, but ultimately unattainable, goal. Some are born to wealth, others to poverty; some to homes with book-lined walls, others to the illiterate; some in cities, others on farms. As a society we can set goals of equal opportunity, but we mislead when we promise what can never be realized.

The state, though, does have a responsibility to ensure that the stairway to social and financial success is available to all. The mark of a fair society is the ease with which intelligence, aspiration and hard work make that escalator accessible.

And that depends on education. We should ensure that the best public school education is available; so that all children have the best possible shot at success. We have failed in that regard. While Vouchers and Charter Schools provide needed competition to a system that is mired in corruption and ineptitude, unions act as obstructionists. They persist in protecting poorly performing teachers and retaining underperforming schools. Too many traditional public schools measure success by longevity, not results. Too often they protect the incompetent and ignoble. The best way to help youth adapt and to ensure economic success and social mobility is to reform the unions that represent teachers and staff.

Creative destruction is what allows business practices and technologies to evolve. (It is why competition in schools may be unwelcome by unions, bad teachers and inept administrators, but is good for students.) But transitions are difficult. The industrial age brought opportunity to the smart, aspirant and opportunistic – to the risk taker. The blacksmith gave way to the auto mechanic. Mechanical parts in cars have been replaced with electronic components. In the 19th Century, such advances allowed entrepreneurs to rise above the landed gentry. That era gave birth to a new monied, merchant class. In our own age, the internet has radically changed the way we communicate, shop, study and write. It, too, has brought untold riches to a small number of people, and has provided convenience and savings to millions more. Unfortunately, it has also meant that thousands of workers have had to learn new skills, in order to stay employed.

We can see the effects of creative destruction today, in national and local bookstores trying to compete against Amazon. We see it in traditional taxi companies being challenged by Lyft and Uber, and in hotels and motels being threatened by Airbnb. Will some people and businesses suffer? Of course, but is that reason to stop progress?  Should consumers be required to pay more because their traditional supplier could not sell books, provide taxi rides or hotel rooms at competitive prices?

Unfairness is often the consequence of government intervention – sometimes unintended, but often intended. The Federal Reserve, in keeping interest rates at abnormally low levels, has benefitted the wealthy at the expense of the retired and poor. Regulation costs the economy an estimated $1.9 trillion annually. Some of that is necessary, but much is a result of cronyism, where large and powerful companies act in cahoots with politicians to design regulations to protect them against small and midsize would-be competitors (think “too big to fail” banks and Barnes and Noble). Complexity in the corporate tax code (think businesses like GE, and those public companies that use options excessively) is a consequence of politicians granting favors to special interests. Public sector unions pit government employees against taxpayers, in protecting jobs, some of which are as useful as a fireman on a high speed train.

But the biggest factor in creating inequality has been the willingness of a small number of creative entrepreneurs to take a chance. When we look back on this period from the perspective of a few decades, I believe it will be seen as one of the more creative periods in our commercial history. From fracking to mobile apps, our lives have been changed – mostly for the better and mostly in spite of what government has done.

Unfortunately, in our interest to be fair we have created a form of corporate welfare that makes more difficult the creative destruction that is natural to society’s advancement. It was our desire to be fair that led to the destructive lending practices and ultimate collapse of Fannie Mae and Freddie Mac in 2008. Europe is leading us in this regard, which is one reason for their slower economic growth. Theirs is the direction “compassionate” socialism leads.

In the end, what I want is no different from what most people want – individual freedom, government that keeps us safe at home and abroad, provides a viable infrastructure and that protects those basic principles found in our Constitution. I believe we should be free to make mistakes and rewarded when success comes our way. I want an economy that grows well, so that more people can be employed. I want an education system that will allow my grandchildren to do well. We must make sure we have a system that allows the elderly, the very poor and the incapacitated to lead lives with dignity. We must provide training to those whose jobs have been displaced. But we should not breed dependence, nor should we make false promises that we know can never be realized, and we should abandon any pretense that the world will one day be equitable for all.

I believe in the essence of personal responsibility and fear the debilitating effects of dependency. I believe that a moral sense, based on mutual respect, is critical in a civilized world. Overseas, I recognize that strength is imperative to peace, for there are tyrannies that find our way of life at odds with theirs.

I don’t want to live in a place where equality of outcomes is the goal, for I know that is the illusionary promise that leads to despotism. I do, however, want to live where equality under the law is the rule and in a society that strives to provide equality of opportunity for everyone.
































Monday, October 20, 2014

“Political Correctness, Morality and California Bill SB 967”

                  Sydney M. Williams

Thought of the Day
“Political Correctness, Morality and California Bill SB 967”
October 20, 2014

In the mid 1960s – around the time I was married and beginning to have children – the counterculture movement moved into high gear. Almost from the first battle at la Drang Valley in the Central Highlands in late 1965, the Vietnam War divided the country. A few anti-war protestors became as violent as those they were protesting against. Civil Rights and Women’s Rights were in full swing. The “pill” was in common usage. Through the haze of marijuana, amid the sniffing of cocaine and dropping of acid, free love made its entrance. Woodstock symbolized that time. Women threw away their bras, as a right of passage, failing to anticipate that a later passage into middle age would require those undergarments for comfort’s sake.

What, I wonder, would former hippies, those who were then young, free-thinking and living in communes and places like Haight Ashbury, feel about Berkley’s requirement that students today give up their sexual freedom? On whose side would Mario Savio appear? Before engaging in any sexual activity, like kissing, necking or something more intimate, California’s new law says that consent must be agreed to in advance.

Consent can “come in the form of a smile, a nod or a verbal ‘yes,’ as long as it is unambiguous, enthusiastic and ongoing” – a statement that itself is ambiguous. The Bill goes on:  “A lack of protest or resistance does not mean consent, nor does silence mean consent.” So much for what we remember of “no’s” morphing into “yes’s,” as petting got heavier! Would a text message be more definitive? Exactly how far will the party of the first part allow the party of the second part to go, before the party of the first part cries out: “This is sexual harassment!”

California Bill SB 967 was passed by the legislature and signed into law by Governor Jerry Brown on September 29th. Berkley defines sexual consent (generally aimed at women) as agreeing to three ‘pillars’: “Knowing exactly what I am agreeing to; expressing my intent to participate; deciding freely and voluntarily to participate.” Formal consent must be received at each step, or it must have been decided in advance, which puts a damper on the instinctual nature of love making. Just imagine Cary Grant and Ingrid Bergman in “Indiscreet:” As Ms. Bergman falls passionately into Mr. Grant’s arms, he suddenly remembers, so asks, “Have you signed your consent forms?” If she, panting, answers “Yes,” Mr. Grant would then be required to ask, “Are doing this of your own free will?” I suspect the movie would lose some of its spontaneity, even if Ms. Bergman retorted, “Look, Stupid, just get on with it!”

The law is asinine, intrusive and impossible to enforce. How, for example, does one prove that “verbal consent” was given? Does the law apply to gays or transgenders? The law is typical of government whose propensity is to address symptoms, rather than causes. The Bill ignores human nature and the natural inclination of young people to experiment. Keep in mind, experimentation, by definition, implies a desire to learn.

Nevertheless, there is a problem. We are told that the number of rape attacks has increased. Most go unreported and when they are, victims too often become victimized by authorities. If, as claimed, there are more campus rape cases, it is likely for one of two reasons – or perhaps for both. Women today are more likely to report crimes of this nature, which is a good thing. And such attacks reflect declines in mutual respect, which is a bad thing. Political correctness promotes erroneous reactions toward multiculturalism; thus bears some responsibility. The p.c. police argue it is wrong to impose our moral standards on others. Such mushy thinking ignores the reality of a universal code of ethical conduct – that all people, regardless of gender, religion, nationality or heritage should be treated with respect. These are the unwritten laws that allow people of different faiths and cultures to live peacefully among one another. To some these rules seem dated, which they are. But their relevance is eternal in true multicultural societies. They are what allow us to live civilly among people of different faiths and cultures.

But, when our culture revels in songs like Meghan Trainor’s Billboard number one, “All About That Bass,” which says that the most important thing for teenage girls is that boys think you're sexy, should we be surprised that rape has increased? With Berkley making available myriad means of birth control and offering abortion clinics, is there not a smidgeon of hypocrisy in this whole affair? The state and our culture promote the means then deny the consequences.

Unfortunately there is no way to protect our young against every bad person or every unfortunate circumstance they will encounter. When I look at my grandchildren, I know that there will be times when their hearts will be broken and they will be devastated emotionally. I recognize that growing up means they will likely be bullied, teased, or harassed. I just hope they do not become the predators. When I see their innocent, trusting young faces, it is heart wrenching to know that their lives will unfold in such a way that not every day will be perfect.

But I also know that if every child adhered to a moral code of behavior, that if he or she learned right from wrong from their parents, or early in their school years, there would be less hurt in the world. “Selfies” symbolize our age, which is one of fixation on the self – that it is all about me. Rules of behavior, so often condemned by the politically correct, demand a subsuming of the self to the community. We will never eliminate all sexual predators, but with proper moral and ethical training their numbers should be reduced.

California Bill SB 967 reflects an ignorant arrogance that government can solve all our problems. That they cannot do, but government should help promote codes of behavior that are common to all civil cultures: respect, decency, honesty, tolerance (though not of the intolerant) and ethical behavior. These traits should be instilled by families, and should be part of the curriculum of our public schools. These characteristics are not the exclusive property of any one religion or culture. They are universal. They are based on the concept that civil behavior allows individuals to live in communities, instead of as hermits. 

The Bill is just dumb; worse, it suggests an unawareness of human behavior. It is difficult for a group badly in need of a moral compass to legislate values. No wonder our youth are confused.





Thursday, October 16, 2014

"The Obamaconomy"

                 Sydney M. Williams

Thought of the Day
“The Obamaconomy”
October 16, 2014

In one of the great rhetorical reaches of all time, Financial Times columnist Edward Luce recently wrote of the paradox that America’s first Black President has presided over the biggest drop in African-American wealth since the Great Depression – a true statement. However, he added the following: “By no honest reckoning can Mr. Obama be blamed for the decline in black America’s fortunes. Yet the facts are deeply unflattering.” It read like an apology, but I am unsure to whom.

The facts are not just “unflattering,” they are condemning. Under Mr. Obama’s watch, the rich have become richer and the poor, poorer. Asset prices have boomed, while wages for non-white households have declined 10%, since 2009. The economy has limped along because of the underlying strength of American entrepreneurship and because of fracking that gave new life to the oil and gas industry – a technology that Mr. Obama did his best to shutter. Around the world, we are more disliked in the Middle East than we were when George Bush was President. Our relations with our European allies have sunk, and the “re-set” with Russia has been to increase the animosity between our countries.

With Mr. Obama, Harry Truman’s “buck” slithers past like a snake through the grass. He is a master of ducking responsibility for all unpleasant consequences of his policies: Blame Republicans in the House, blame Mitch McConnell, blame the Koch Brothers, blame the Maliki government, blame accountants (for tax inversions), blame the video, blame social media (for fomenting fears of terrorism), blame the media (for his slumping poll numbers), blame Bush (for everything!) He is the Teflon man. His acolytes in the press see-no-evil and hear-no-evil; so they neither speak-no-evil nor write-no-evil. One senses that fear of offending does not allow principles of accountability to apply. Mr. Obama’s supporters, in this regard, reflect an unspoken racial prejudice. It should make no difference what race, gender, religion or culture one is, one should always be held accountable for the ideas one espouses, the actions one takes and the results one gets.

The economy did receive a bit of good news a couple of weeks ago when unemployment dropped below 6%, the lowest point since the summer of 2008. But at the same time, the Labor Department noted that the labor force participation rate also fell to a 36-year low of 62.7%. Total non-farm workers in the U.S., as of last month, were preliminarily stated as 139,435 – about 5.5 million more people employed than when Mr. Obama took office in January 2009. While those numbers get touted by the Administration, what is omitted is that if the labor force participation rate were the same today as it had been in January 2009 (65.7%), and one accounts for the increased population there would be approximately 8.0 million more Americans working today.

The Administration is fast off the mark when it comes to citing inequality in incomes and wealth, yet the Administration sees no correlation between cause and effect. They fail to mention that the gap has widened in the past six years. The basic problem, in my opinion, stems from the fact that Mr. Obama was never able to forge a coalition with Republican legislators to implement fiscal reform. Consequently the recovery has been primarily dependent on the Federal Reserve and monetary policy. Less than two weeks after his inauguration, at a meeting of Administrative officials and Party leaders from both houses, Mr. Obama responded to Senate Minority Whip Jon Kyl (R-AZ): “I won,” he said, setting the tone for the next several years. The United States is a two-Party country. Mr. Obama won 52.9% of the vote, clearly making him the winner, but almost 60 million people voted for John McCain. Unilateralism may work in some international situations and in one-party countries, but it does not work in a democracy.

In April 2010, Mr. Obama issued an Executive Order, which created the Simpson-Bowles Commission to explore a fiscal response to the economic crisis. On December 1st, 2010, with Democrats still in control of both the Senate and the House, the Commission issued its report, but with only 11 of the 18 members endorsing it, not the 14 that would have required it being taken to the floor for debate. (Incidentally, more Democrats opposed the report than Republicans.) But instead of using the Commission’s report as a starting point for a dialogue, it was ignominiously dropped. A lack of bipartisanship can be blamed on both Parties, but the President, because of his position, bears the greater responsibility.

There is general unanimity that the first round of quantitative easing (QE1), in the summer of 2009, helped avoid what might have been a far worse downturn. There is little agreement as to the success of subsequent rounds, however, at least in terms of spurring economic activity. The problem was that the Fed became the only game in town. A recalcitrant Congress and an aloof President, more interested in fund raising and golf than in governing, proved unable to collaborate on a fiscal package designed to encourage economic activity. Instead, when Mr. Obama’s Party controlled both the House and the Senate, they focused on enlarging government’s role in the economy. They passed – unilaterally – a healthcare bill with yet-to-be determined costs and with questionable benefits. They instituted Dodd-Frank, which issued rules for the financial sector that have allowed banks “too big” to become even bigger while creating 400 new regulations, at an annual cost of $20 billion. And they passed a stimulus package that even Mr. Obama acknowledged did not stimulate.

Apart from favored industries and businesses like Solyndra and Tesla, the President has done little to help small and midsize companies. These businesses need tax and regulatory relief. Companies expand by reinvesting earnings back into their business or in accretive and business-compatible acquisitions. Very low interest rates encourage riskless investments. In 2002, according to a Barclay’s study, 50% of earnings were spent on capital expenditures and 15% on stock buybacks. Today those numbers are 40% and 30%. Since 2009, $1.99 trillion has been spent repurchasing shares. That has helped shareholders, but has not done much for jobs or the economy. Mr. Obama may not deserve all the blame, but he is the President who has increased taxes, especially those related to ObamaCare, and added stiff regulations, particularly in regard to the EPA and Dodd-Frank. He is the President who has allowed monetary policy, not fiscal policy, to drive what feeble economic recovery we have had.

While the annual deficit has recently fallen – because of higher tax revenues and sequestration – total debt continues to grow. At the end of fiscal year 2014 total federal debt, including that owed to government accounts like Social Security, was $17.823 trillion, an increase of $1.077 trillion from the year earlier. Driving revenues were individual and payroll tax collections (+7.5%) and corporate taxes (+13.1%). Driving expenses were transfer payments (+5%) and interest on the public portion of the debt (+5.4%). Defense spending, in contrast, declined 4.9%. Should interest rates go up, or should conditions in the Middle East, Asia or Eastern Europe further unravel, expenses will rise. When the next recession hits, which is inevitable, transfer payments will continue to rise, but tax collections will decline.

In 2011, Standard & Poor’s downgraded U.S. debt from AAA to AA+, the first instance in our history. Since recovery began in the spring of 2009, there have been only three quarters when economic growth in the U.S. exceeded four percent – Q4, 2009; Q 3, 2011, and Q2, 2014. The other seventeen quarters have shown mediocre growth. Mr. Obama’s focus on increasing the government’s sphere of influence in the economy is principally to blame. Europe, with its greater role of government in the economy, has underperformed ours for decades; yet that is the model Mr. Obama chooses to emulate.

Mr. Obama’s legacy has been one of rising inequality. Obamanomics is characterized by very low interest rates, widening wealth and income gaps, slow economic growth, greater involvement of the State in the economy and increased dependency. Its manifestations indicate that the brunt of the recession has been borne by the least affluent. Since Mr. Obama took office almost six years ago, the gap between white households and black households has risen from seven times to eight times. The median non-white American family has a net worth 20% lower than when he took office, while median wealth for the Country as a whole is one percent higher. Black unemployment has consistently been twice that of whites. And now Mr. Obama wants to grant permits to illegal immigrants, hurting those he has pledged to help. He has further marginalized the already marginalized.

Corruption and cronyism have flourished. Mr. Obama has attended approximately 60 fundraisers so far this year, raising millions for himself and his Party, while costing taxpayers millions in added security.


In the end, it is Mr. Obama’s belief in the altruism of government that has defined his Presidency. He has allowed it to become bigger. He ignores the truism that it is the private sector that creates jobs in this Country. In doing so, they do the most to help the poor. As Brian Wesbury wrote in Wednesday’s Wall Street Journal, “The larger the slice [of the economy] taken by government, the smaller the slice left over for the private sector.” Amen.

Monday, October 13, 2014

"Bloated Government Bureaucracies"

                              Sydney M. Williams
                                                                                                                              Thought of the Day
“Bloated Government Bureaucracies”
October 13, 2014

Wall Street has always been divided between producers and overhead. The same is true in every for-profit profession and business. When “overhead” overwhelms production, profits collapse and the business fails. Technology has allowed for-profit and not-for-profit businesses to reduce overhead staff, thereby increasing the ratio of producers to staff.

That is not true in government where profit is not necessary for viability. Government does not manufacture goods or produce services to sell. The purpose of government is to secure and protect the rights of its citizens – to protect the people against loss of life, liberty and the unlawful seizure of property. Obviously, government’s role has become far more complex, which is one reason bureaucracies have grown, but it does not explain why they have become bloated.

Over the past eighty years government’s role in the economy has become increasingly intrusive. When state and local governments are included, total government spending exceeds 41% of GDP. A hundred years ago, that number was 7%. At that time, state and local spending exceeded that of the federal government. Today, the latter has the lion’s share.

As insidious as burgeoning bureaucracies (and related to it) is cronyism, which exists between government, big business, favored industries and public sector unions. Banks too big to fail are protected against failure, giving them a cost advantage versus their smaller, regional competitors. Industries are favored because of long term relationships or because products and services coincide with an Administration’s agenda. Unions are interested in expanding their reach. Big bureaucracies are in their wheelhouse. With private sector unions in decline, the public sector represents their only growth opportunity. Taxpayers, small businesses and fans of small government stand on the outside and ogle the party to which they were not invited.

Is this trend a good thing? No, because it is ultimately debilitating for both the economy and democracy. Big companies lobby for tax relief and for regulations that limit competition. Small and midsize companies do not have the same means; their stretched margins negatively impact economic growth. Complex regulation increases costs and reduces employment. Government bureaucracies have become self perpetuating, benefiting those who feed off the public teat. Are tax payers getting an adequate return on their investment? It seems doubtful.

We can see the negative impact of increased government participation in the economy in GDP per capita that has slowed over the past few decades. Between 1950 and 2013, GDP per capita compounded annually at 2.02%, but between 1990 and 2013 it annualized at 1.4%. Europe provides a view of the future, as Eurozone government spending as a percent of GDP exceeds 50%. Arguably, infrastructure spending does help economic growth. Better roads, rail systems and airports can speed the movement of goods and services. The problem is that funds for such services are being squeezed. Transfer payments now exceed 63% of all federal spending, rendering discretionary spending (which includes infrastructure investments) subject to cuts. There may be other explanations for slowing growth, but logic suggests that the greater the government’s role, the less room for the private sector. Expansion of government is a boost to overhead costs, reduces the number of producers and hurts profitability.

Most organisms have an instinct to expand, not contract. And that is certainly true for government. Very few people want to take over a department with the mandate to shrink it, anymore than they would a business. It is our nature to grow, not contract. It is why we applaud those like former Indiana Governor Mitch Daniels who shrank his state’s bureaucracy.

Are tax payers getting their money’s worth? The answer to that varies on the respondent, but one can look at the performance of our high school students in international competition and not feel comforted. On our highways, we can see and feel the lack of maintenance. The same is true for our bridges and tunnels. In Washington, from the aborted rollout of ObamaCare to the scandalous Department of Veteran Affairs; from the ineptitude of the Secret Service, to an Internal Revenue Service that has been exploited for political purposes, we have seen the consequences of amorphous, uncontrolled bureaucracies. Whatever happened to the public servant, who was there to serve the taxpayer for whom he or she worked?

Bloated bureaucracies are not limited to the federal government. Among the worst examples are our public schools. Between 1970 and 2010, public school enrollment increased 7.8%, while the teaching staff grew by 60%. But it is the non-teaching staff where the problem lies. In the past forty years, they grew by 138%. In doing so, they increased the roles of dues-paying union employees, but did little to help students. Across the United States today, non-teaching staffs comprise 50% of education jobs. In 1950, they represented 29.82% of education jobs. Have students been helped? Their performance on international tests suggests the answer to be no.

To take one example: in Old Lyme, Connecticut, where I live, the high school has 409 students and a total staff of 86. Of those, 37 are teachers and assistant teachers. The rest – 49 – are administrative and staff. Teachers only represent 43% of education jobs in the Old Lyme High School! While the teacher-student ratio, at 11.1-1 is something I applaud, I can not say the same about the staff-student ratio of 8.3-1. It is bloated and assuredly unnecessary.

Bloated bureaucracies put our entire free-market, democratic system at risk. Many of these people have forgotten the meaning of service. Crony capitalism encourages bureaucrats to protect the big at the expense of the small. Unions have no interest in taxpayers, other than as a source of funding. Worse, they pit government employees, who are supposed to serve the public, against taxpayers who are paying their wages. Bloated bureaucracies breed indolence and arrogance.





   

Thursday, October 9, 2014

"Past is Prologue"

                               Sydney M. Williams

                                                                                                                        Thought of the Day
“Past is Prologue”
October 9, 2014

Dwelling too much on the past can make one myopic, but paying cursory attention is instructional. The juxtaposition of two articles in Monday’s New York Times gave pause. One dealt wth the past; the other a hint of the future. The first was an article on page A4, “In Poland, Unearthing a Barbarous Past.” The second, an article on page A6, “Tensions Surge in Estonia amid a Russian Replay of Cold War Tactics.” Lessons to be drawn: technology may change, but people do not, and bad leaders take advantage of weakness, real or perceived.

The human remains pulled from the muddy clay around an old prison near Bialystok, Poland are anonymous victims of Nazis, Soviets and Soviet-directed Polish secret police. They are reminders that, as much as we may wish it otherwise, man has never lived peacefully. Whether the causes are economic, geographic or cultural, war has been and always will be ever-present. Nothing has happened in the past few decades to suggest that his behavior has changed. To assume that the Twenty-first Century will be absent the curse of inevitable conflict indicates a naïveté that is based more on hope than experience. That sense permeated Europe 100 years ago, in the early years of the Twentieth Century preceding the First World War.

Today’s complacency toward the ambitions of Vladimir Putin is based less on naïveté than on war weariness. For almost a decade and a half we have been at war with Islamic extremism. We are deluged with horrific images, often in real time. War is no longer something that happens “over there;” it is on television, in our kitchens and living rooms. We see the results of exploded IED devices and what a suicide bomber can do to school children. Postings of beheadings are viewed on YouTube. Images of water-boarding torture and the inhumane treatment of prisoners at Abu Ghraib Prison caused some of us to look upon ourselves as perpetrators of violence. The perfectly natural emotional reactions of people to the horrific consequences of war make it difficult for democracies to make the hard decisions necessary to defeat the evil we face.

Despite our first-hand experience of Islamic terrorism on 9/11 and the fact we were told that the ensuing war would be generational, we have difficulty staying the course. We have been emotionally spent. We all wanted to believe Mr. Obama when he told us that with Osama bin Laden dead the threat of al Qaeda and Islamic terrorism were in retreat.

Vladimir Putin, as a former KGB operative, is a student of human psychology; he saw an opening. He knows that, in places where there is no censorship, images of war can cause a strong country to respond weakly. He went unopposed into eastern Ukraine and is now testing the waters in Estonia, as the article in the New York Times made clear.

In 1992, following the collapse of the Soviet Union, Francis Fukuyama wrote The End of History and the Last Man. A year later, in Foreign Affairs, Samuel Huntington wrote an article, “The Clash of Civilizations?” Both men assumed that the age of ideology had ended (that Western democratic capitalism had won) and that wars in the future would be between civilizations, much as what we are experiencing today between Muslim extremists and the West.

The cauldron that is the Middle East is indeed a clash of civilizations, but Russia’s incursions into Ukraine suggest that ideological differences remain very much alive. Russia’s threatening moves along their Estonia border argue that the Baltic States (NATO allies) should be as concerned about Russian aggression as the Ukrainians, Georgians and Kazakhstanis.

In August, 1980, Republican Presidential candidate Ronald Reagan spoke before the Veterans of Foreign Wars Convention in Chicago:[1] “Firmness based on a strong defense capability is not provocative. But weakness can be provocative simply because it is tempting to a nation whose imperialist ambitions are virtually unlimited.”

World War II had many sires, not the least of which was World War I, which gave birth to Communism in the Soviet Union and created the conditions that led to Nazism and Fascism in Germany, Spain and Italy. France and Great Britain, drained by the human costs of the First World War, were unprepared for a second. It was a conscious (or unconscious) decision to ignore reality that allowed Hitler to re-arm, take the Sudetenland and absorb Austria without any reaction. The September 1939 invasion of Poland became the catalyst that got the Allies to respond, but by then the die had been cast. A question that has long troubled historians: If the Japanese had not attacked Pearl Harbor and if the Germans had not subsequently declared war on the United States, how long would it have been before the U.S. entered the War? Would they have done so? If they had not, it is plausible that Hitler would have dominated Europe for the next few decades and the future of that Continent would have unfolded in a very different way.

The past is prologue. Time has provided us better and faster means of communicating. The freer flow of goods, services and money has made us wealthier. But they have not civilized us. Greed and ambition are as prevalent in political leaders as they are in all other professions. Callousness of behavior and the disregard for the rule of law are as common today as they have ever been. Settling differences diplomatically is invariably preferable to war, but we must be conscious that there will be those who will always take advantage of weakness, real or perceived.

Civilizations will clash and ideologies will be in opposition. World events are determined by the behavior of people – how they act and react. Being unprepared, as Ronald Reagan said, is to be provocative. The human remains dug up in Bialystok are a reminder that the more quickly one confronts a bully the less will be the damage. Vladimir Putin is a bully; he wants to reassert Russia’s domination. The free world cannot afford to let that happen. We must be prepared.











[1] The quote was found in Tuesday’s Wall Street Journal, in the “Notable & Quotable” column.

Monday, October 6, 2014

"Hong Kong"

                                 Sydney M. Williams

Thought of the Day
Hong Kong
October 6, 2014

Freedom is not for the faint of heart. The desire to be free is universal. It is not limited to the sons and daughters of the Enlightenment. Cemeteries around the world are filled with those who have died for freedom. Islamic terrorists have brutally decapitated American and British journalists and aid workers, and then posted them on YouTube in an attempt to thwart the spread of democracy in the Middle East. But one of the most repressive regimes in the history of mankind – China – too often gets a pass from those who admire her current mercantilist prowess.

The protests in Hong Kong, which after ten days appear to be dissipating, have elicited support from all over the world – except in mainland China where leadership fears an informed citizen, and in Washington and London where leaders have effectively sided with Beijing, “in,” as Martin Lee, founding chairman of the Democratic Party in Hong Kong, explained in Saturday’s New York Times, “a disgraceful display of power politics.”

While it is impossible to accept Freedom House’s country-by-country report without a grain of salt – for example, Jamaica and Namibia place ahead of the United States – directionally they are right. On the list of 179 countries on the 2013 World Press Freedom Map, China ranks 173, which worries those in Hong Kong who had been promised, under the 1984 Sino-British Joint Declaration, the right to elect their own leaders. (That paper was signed 13 years before the British ceded rule over Hong Kong to the Chinese in 1997. Nevertheless, the term of the Declaration was for fifty years.)

Instead, Beijing has ruled that candidates for Hong Kong‘s top executive post must be vetted by a nominating committee filled with Chinese government allies. It is for the right to hold free elections and for the resignation of Leung Chun-ying that those in Hong Kong have been demonstrating. Mr. Leung was elected chief executive on a pro-Beijing ticket two years ago.

That this protest comes on the anniversary of the demonstration and then massacre at Tiananmen Square has not gone unnoticed. Estimates are that more than a million gathered in 1989 in Beijing’s central square. The Square is named for the north, or Tiananmen gate, which means the Gate of Heavenly Peace. In early June 1989, it was anything but peaceful. Thirty divisions, or roughly 200,000 Chinese troops and artillery, entered the Square to dispel the protestors. How many were killed is a state secret, but estimates put the number in the thousands.

Estimates are that there are over a million protestors in Hong Kong, which is remarkable for a city of just over seven million people. President Xi Jinping is in a tough spot. In the Wall Street Journal he was described by Orville Schell, director of the Center on U.S.-China Relations at the Asia Society, as a “strong and unyielding leader.” Mr. Xi now oversees the world’s second largest economy. It is not clear that he can use force the way Premier Li Ping did in 1989. First, Hong Kong is a relatively open city, with thousands of workers who come from countries across the globe. It is far more cosmopolitan than the capital 1200 miles to the north. Second, social media is ubiquitous today, unlike the “dark ages” of 1989, meaning that whatever Mr. Xi does will be viewed by people around the world in real time. And, third, Hong Kong has a reputation as a relatively free city. It is the gateway to the mainland. It was Hong Kong that propelled China’s economic growth over the past two decades. It was Hong Kong that has made China part of the pool of “established” nations.

An anonymous senior Obama Administration official was quoted in Friday’s New York Times. He stated: “We have principles and values that we want to promote, but we’re not looking to inject the United States into the middle of this.” Agreeing, China’s foreign minister Wang Yi said: “Hong Kong’s affairs are China’s internal affairs.”

That is the accepted wisdom in international relationships. But should that always be the case? When does repression deserve a strong international reaction? Kristallnacht occurred more than three years before the United States entered the war against Germany. Did we do the humane thing in deferring intervention, leaving millions of Jews to be murdered by Nazis? Between the years 1975 and 1979, the Communist Khmer Rouge killed 21% of the population of Cambodia. Were we right to ignore the plight of those hapless people? I don’t pretend to have the answers, but it is not right to ignore mass killings, whether it is the genocide of Islamic extremists exterminating Turkmens, Yazidis, Shabaks, and Christians, or whether it is the Chinese killing hundreds of thousands of Tibetans. At some point it is our business. As John Donne wrote 400 years ago, “Any man’s death diminishes me, because I am involved in mankind.” What nations do within their borders can have implications beyond them.

Freedom is the best antidote to inequality. Despotism is its friend. Only six percent of China’s citizens are members of their Communist Party, yet they control the political system and the vast portion of its concentrated wealth. China is home to 152 billionaires, second only to the United States. (Its authoritarian neighbor, Russia, is third.) Yet, over 900 million people live on less than $5 per day.

So, why wouldn’t the people of Hong Kong be protesting? While today they are freer than their brethren on the mainland, they sense the long arm of Beijing. They want to regain the independence they once had. The average income in Hong Kong is ten times that of China. Being wealthy, they don’t want to become poor. Residents of Hong Kong understand that mercantilism, as practiced by the Chinese, does not lead to social justice, the rule of law or income equality. It is a form of elitism hidden behind the facade of socialism. As Seth Lipsky recently noted, Hong Kong has already had its taste of freedom. And that is what worries those in Beijing. Mr. Lipsky added, “If freedom comes to China, it is going to enter through Hong Kong.” 

Leung Chun-ying gave an ultimatum to the protestors Sunday evening – leave by Monday morning or the police would “take all actions necessary” to clear blockades to government offices. Demonstrators have stayed on, but their numbers dwindled and access was allowed to government offices this morning. It remains to be seen whether their message was heard in Beijing. But freedom is fundamental. It requires courage and should always be defended.





Thursday, October 2, 2014

"What Students Should be Taught"

                                   Sydney M. Williams

Thought of the Day
“What Students Should be Taught”
October 2, 2014

The “skills gap” has been blamed for both the persistent high unemployment and the sluggish economic growth we have experienced. Our schools, which have received the bulk of the blame, are only in part culpable. Responsibility must be shared with government immigration policies that have admitted an insufficient number of high-skilled immigrants, and with employers who, for expediency’s sake, have bypassed the training process. But, perhaps even more important has been the decline in cultural lessons and values. We live so much in the present, while focusing on the future, that we have too often ignored the great literature of the past, with their tales of human behavior under myriad conditions and the moral lessons that were integral to the stories.

A consequence of our concern regarding the preparedness of our youth has been a renewed effort to ensure that high school and college students are well versed in STEM courses (science, technology, engineering and math). Since a major purpose of a high school and college education is to get a job, such courses make sense. The practical application of theory is how we build better computers, hospitals, automobiles, bridges, insurance companies and fighter jets.

Our young people face a far more complex world than simply finding and honing a skill for today’s needs. The skills that today seem adequate may not fit needs ten or twenty years hence. Ray Kurzweil, in The Singularity is Near, argued that humans will transcend the limitations of our biology – that the distinction between man and machine will blur more than they have. He writes about this disruptive transformation: “The nonbiological intelligence created in that year (2045) will be one billion times more powerful than all human intelligence today (2005).”

While Mr. Kurzweil’s predictions stretch even the most futuristic imagination, there is no question that the amount of knowledge is growing exponentially. In 1982, with the publication of Critical Path, Buckminster Fuller wrote of the “Knowledge Doubling Curve.” He noted that until about 1900, knowledge doubled roughly every 100 years. Then growth, which had been linear, became exponential. Today, knowledge is doubling every one to two years. There are some who believe we are on track to a doubling every twelve hours. Whatever the real speed, the amount of information available to our children and grandchildren is far vaster than what we had to learn. That fact alone explains, in part, why we are so often surprised by the lack of familiarity the young have with literature, history and geography that we took for granted. It complicates the education process. With so much material available, what should be taught?

Our young do need the skills embedded in STEM courses, or should at least be exposed to them. For no matter our curiosity or the desire to learn, without jobs we cannot survive. Like it or not, we will increasingly become specialized in relatively narrow fields.

That is all for the good, but I believe that we must also help young students learn judgment – to make wise decisions. Obviously wisdom and judgment are skills necessary in leaders, be they in politics, business, academia, law or medicine. But such skills are crucial for everyone, because everyday all of us make hundreds of judgment calls, whether it is a teenager deciding who to hang with, a pedestrian crossing a busy street, a homemaker weighing the value of a bio-degradable detergent against its higher cost, a politician deciding between a pragmatic or a moral response, or a company CEO considering an offer for his business. Age and experience help the process, but education can abet the process.

It is through the study of classics and Great Books that we learn how men and women respond to emotions common to all of us – the value of faith, thankfulness for the freedom we have. These are as relevant today as they were when the novels and histories were written. While writers in all ages wrote to entertain, those of an earlier era also wrote to instruct. Most of them expressed a moral sentiment, or, at a minimum, displayed the behavior of their protagonists. The study of Latin helped students think logically. It underlined the value of listening and was valuable when debating a premise without reverting to antagonistic argument. From Greek mythology to Dickens, stories were told with a lesson. Examples of virtually all human emotions – fear, pride, greed, lust, love, patriotism and hate – can be found within the pages of Shakespeare, Tolstoi and dozens more.

The story of Pip in Dickens’ Great Expectations is a coming-of-age story, with foster parents and a scary, but ultimately beneficial Abel Magwitch. We read of doomed love in Anna Karenina, in Dostoevsky eponymous novel, and of youthful hubris in Jane Austen’s Emma. We learn of misplaced passion when we study Balzac’s Père Goriot, and we better understand shameless greed in getting to know his daughters. Lear and Ahab were men whose self-absorption doomed them to madness. Before film, authors had to create characters that were live on the page. One cannot read about George Eliot’s Maggie Tulliver today without tears coming to one’s eyes for the purity of her love for her flawed father and for her hunch-backed friend Philip Wakem and the tragic consequences of her last years and death. More recently, Stuart Little’s quest is a morality tale, as is Tolkien’s trilogy, The Fellowship of the Ring. Books of this caliber should be read and discussed by all students, regardless of career plans.

There is no question that schools and colleges should provide the young with the skills needed to become employed, but they should also provide the tools that will help them become better citizens and more astute judges of character, to help them in the myriad decisions that comprise everyday life. Professor emeritus Donald Kagan’s impressive op-ed in last weekend’s Wall Street Journal, on the need to incorporate patriotism into the curriculum is on the mark. With the federal government assuming unprecedented powers, a better understanding of democracy is critical.


Our youth must learn to differentiate between right and wrong, to be respectful of others and appreciate the freedoms we have. The amount of knowledge has increased and will continue to do so at exponential rates. But our behavior has not changed. It is because we are individuals incapable of absorbing all there is to learn that we must recognize that which is permanent. We must provide the tools to help our students to properly judge the options they will have.