Click on WORD or PDF for full content

WORD

PDF

David Stockman, Reagan budget director dropped a stink-bomb in the NY Times OpEd section this weekend. It has been the talk of Monday.

The Dow Jones and Standard & Poor’s 500 indexes reached record highs on Thursday, having completely erased the losses since the stock market’s last peak, in 2007. But instead of cheering, we should be very afraid.

Over the last 13 years, the stock market has twice crashed and touched off a recession: American households lost $5 trillion in the 2000 dot-com bust and more than $7 trillion in the 2007 housing crash. Sooner or later — within a few years, I predict — this latest Wall Street bubble, inflated by an egregious flood of phony money from the Federal Reserve rather than real economic gains, will explode, too.

Since the S.&P. 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.

So the Main Street economy is failing while Washington is piling a soaring debt burden on our descendants, unable to rein in either the warfare state or the welfare state or raise the taxes needed to pay the nation’s bills. By default, the Fed has resorted to a radical, uncharted spree of money printing. But the flood of liquidity, instead of spurring banks to lend and corporations to spend, has stayed trapped in the canyons of Wall Street, where it is inflating yet another unsustainable bubble.

When it bursts, there will be no new round of bailouts like the ones the banks got in 2008. Instead, America will descend into an era of zero-sum austerity and virulent political conflict, extinguishing even today’s feeble remnants of economic growth.

THIS dyspeptic prospect results from the fact that we are now state-wrecked. With only brief interruptions, we’ve had eight decades of increasingly frenetic fiscal and monetary policy activism intended to counter the cyclical bumps and grinds of the free market and its purported tendency to underproduce jobs and economic output. The toll has been heavy.

As the federal government and its central-bank sidekick, the Fed, have groped for one goal after another — smoothing out the business cycle, minimizing inflation and unemployment at the same time, rolling out a giant social insurance blanket, promoting homeownership, subsidizing medical care, propping up old industries (agriculture, automobiles) and fostering new ones (“clean” energy, biotechnology) and, above all, bailing out Wall Street — they have now succumbed to overload, overreach and outside capture by powerful interests. The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.

The culprits are bipartisan, though you’d never guess that from the blather that passes for political discourse these days.  …

 

… These policies have brought America to an end-stage metastasis. The way out would be so radical it can’t happen. It would necessitate a sweeping divorce of the state and the market economy. It would require a renunciation of crony capitalism and its first cousin: Keynesian economics in all its forms. The state would need to get out of the business of imperial hubris, economic uplift and social insurance and shift its focus to managing and financing an effective, affordable, means-tested safety net.

All this would require drastic deflation of the realm of politics and the abolition of incumbency itself, because the machinery of the state and the machinery of re-election have become conterminous. Prying them apart would entail sweeping constitutional surgery: amendments to give the president and members of Congress a single six-year term, with no re-election; providing 100 percent public financing for candidates; strictly limiting the duration of campaigns (say, to eight weeks); and prohibiting, for life, lobbying by anyone who has been on a legislative or executive payroll. It would also require overturning Citizens United and mandating that Congress pass a balanced budget, or face an automatic sequester of spending.

It would also require purging the corrosive financialization that has turned the economy into a giant casino since the 1970s. This would mean putting the great Wall Street banks out in the cold to compete as at-risk free enterprises, without access to cheap Fed loans or deposit insurance. Banks would be able to take deposits and make commercial loans, but be banned from trading, underwriting and money management in all its forms.

It would require, finally, benching the Fed’s central planners, and restoring the central bank’s original mission: to provide liquidity in times of crisis but never to buy government debt or try to micromanage the economy. Getting the Fed out of the financial markets is the only way to put free markets and genuine wealth creation back into capitalism.

That, of course, will never happen because there are trillions of dollars of assets, from Shanghai skyscrapers to Fortune 1000 stocks to the latest housing market “recovery,” artificially propped up by the Fed’s interest-rate repression. The United States is broke — fiscally, morally, intellectually — and the Fed has incited a global currency war (Japan just signed up, the Brazilians and Chinese are angry, and the German-dominated euro zone is crumbling) that will soon overwhelm it. When the latest bubble pops, there will be nothing to stop the collapse. If this sounds like advice to get out of the markets and hide out in cash, it is.

Stockman makes Steve Malanga’s Jeremiad about state debt mild by comparison. 

Earlier this month, the Securities and Exchange Commission charged Illinois officials with making misleading statements to bond investors about the state’s pension system. The agency detailed a long list of deceptive practices including failure to tell investors that the system was so underfunded that it risked bankruptcy.

Illinois taxpayers, as well as the holders of its debt, will ultimately bear the burden of the officials’ misdeeds. But there is nothing unique about the PrairieState. For years, elected officials in states and municipalities across the country have been imprudently piling up obligations that are imposing serious strains on budgets, prompting higher taxes and cutbacks in services.

In January, city officials in Sacramento, California’s capital, reported the results of a study they had commissioned on all the debt that the municipality had incurred. At a City Council meeting that the Sacramento Bee reported as “sobering,” the city manager explained that Sacramento had racked up some $2 billion in obligations (mostly pensions and retiree health care). All this for a municipality of 477,000 residents with an annual general fund budget of just $366 million.

Sacramento finances are already stretched—the city has cut some 1,200 workers, or 20% of its workforce, in the past several years. Servicing its debt in years to come will only add more woe, especially given the intractability of public unions. The budget report noted that “While reducing staff is clearly not the preferred method for reducing costs, the city has a very limited ability to reduce the cost of labor absent cooperation from the city’s employee groups.”

According to studies by the PewCenter on the States, states and the biggest cities have made nearly three-quarters of a trillion dollars in promises to pay for retiree health-care insurance. Yet governments have set aside only about 5% of the money they’ll need to pay for these promises. …

Michael Barone on why railroad freight pays and passenger trains suck.

Forty years ago, American railroads were in trouble. The Penn Central, the largest railroad, had recently gone bankrupt. American freight rail was technologically obsolescent and hamstrung by union rules and government rate regulation. American passenger rail was unprofitable and unreliable. Freight rail was losing business to trucking firms. Passenger rail was losing out to cars on the new interstate highways and airplanes on long routes. The past 40 years have seen a laboratory experiment on how to revive railroads. Government has gotten out of freight rail, while passenger rail has become largely a public-sector function.

We’ve had a chance to see which works better and to understand why. It took a while for the government to get out of the freight rail business. In 1973, Congress created Conrail, which took over the lines of the Penn Central and other Northeast railroads. Despite rosy projections, Conrail racked up big losses, with the federal government picking up the tab. Fortunately, the idea of transportation deregulation — pushed by Ralph Nader as well as market-oriented think tanks — was picking up steam.

In 1980, Congress passed and Jimmy Carter signed the Staggers Rail Act, ending the rigid rate regulation by the 1887-vintage Interstate Commerce Commission. Conrail began making profits and was sold to private investors in 1987. The following quarter-century has seen a renaissance of American freight rail. As a March 27 Wall Street Journal story relates, rail companies have been investing in rail yards, refueling stations and new tracks. They are building new bridges, widening mountain tunnels and “turning their networks into double-lane steel freeways.” The Association of American Railroads says it will invest $14 billion this year, up from $6 billion in 2003.

But doesn’t this mean higher costs? No, freight rail rates are less than half what they were in the early 1980s. That’s because freight rail faces aggressive competition from trucking, which was also deregulated in 1980. …

Baron Hinkle wonders if the GOP will ever come around on legalizing pot.

… In his new book The Last Line of Defense, Cuccinelli contends the states provide protection from federal tyranny. This is an argument many conservatives find as appealing as they find the U.N. objectionable. And if they extend that line of thinking just a bit, they may come around on pot. 

The syllogism is easy enough to follow: The U.N. should not tell Washington what it can do, and Washington should not tell the states what they can do — so why then should the states tell individuals what they can smoke? What sovereignty is more important than the individual kind?

With liberals such as New York Mayor Michael Bloomberg dictating how much soda you can buy, Tea Party enthusiasts already are primed to declare not just “Don’t tread on me” but also, “Keep your laws off my body.” After all, as Lingamfelter put it in his January memo about Agenda 21: The great threat from the U.N. is that it wants to “tak[e] away individual freedoms from people like you and me.” And that would be, pardon the term, a real drag.

Clikc on WORD or PDF for full content

WORD

PDF

Megan McArdle catches some supreme ignorance from Kathleen Sebelius.

… you should always have liability insurance, but should think twice about collision damage coverage.  It’s why high deductibles are a good idea–for small expenses, it’s better to self insure.  And it’s why “catastrophic” health plans, which only cover the sort of extremely expensive events that most people would have difficulty financing, are a much better deal than the soup-to-nuts plans that most people get through their employers.  Those plans are expensive, both because they’re paying for a higher percentage of your expenses, and because they drive up utilization–which means that they drive up next year’s premiums even more.  Imagine what your car insurance would cost if it covered gasoline, routine maintenance, and those little air freshener trees you hang from the rearview mirror.  Then stop asking why health insurance costs so much.

But Kathleen Sebelius, the Secretary of HHS, thinks that catastrophic insurance isn’t really insurance at all.  

At a White House briefing Tuesday, Health and Human Services Secretary Kathleen Sebelius said some of what passes for health insurance today is so skimpy it can’t be compared to the comprehensive coverage available under the law. “Some of these folks have very high catastrophic plans that don’t pay for anything unless you get hit by a bus,” she said. “They’re really mortgage protection, not health insurance.”

She said this in response to a report from the American Society of Actuaries arguing that premiums are going to rise by 32% when Obamacare kicks in, as coverage gets more generous and more sick people join the insurance market. Sebelius’ response is apparently that catastrophic insurance isn’t really insurance at all–which is exactly backwards. Catastrophic coverage is “true insurance”.  Coverage of routine, predictable services is not insurance at all; it’s a spectacularly inefficient prepayment plan. …

More from John Steele Gordon. 

If you would like to know what insurance really is, and why Obamacare (and much private “medical insurance”) is not insurance at all, but an economic and humanitarian disaster waiting to happen, you cannot do better than Megan McArdle’s delightfully jargon-free article in The Daily Beast.

Insurance began in the 17th century when merchants wanted to protect themselves against the loss of a ship and its cargo. By paying a small amount upfront, they each protected themselves against the loss of a huge amount. This is called risk pooling, one of the truly great economic ideas. By spreading risk, it made it much easier to assume risk, and assuming risk is one of the prime drivers of an economy.

Thus insurance, properly understood, is meant to protect against a catastrophic loss that would be financially ruinous, such as a lost ship. It didn’t pay for a parted topsail halyard. And that’s why if your grandson throws a baseball through a living room window, you call the guy who fixes windows, not the insurance company. It’s when the roof blows off in a storm that you call the insurance company.

But most medical insurance covers everything from hangnails to heart transplants. Have a sniffle? Your insurance company pays the doctor’s bill. This not insurance at all, it’s a prepayment plan.

Megan McArdle likens it to “grocery insurance”: …

Mark Steyn comments on gay marriage.

Gay marriage? It came up at dinner Down Under this time last year, and the prominent Aussie politician on my right said matter-of-factly, “It’s not about expanding marriage, it’s about destroying marriage.”

That would be the most obvious explanation as to why the same societal groups who assured us in the Seventies that marriage was either (a) a “meaningless piece of paper” or (b) institutionalized rape are now insisting it’s a universal human right. They’ve figured out what, say, terrorist-turned-educator Bill Ayers did – that, when it comes to destroying core civilizational institutions, trying to blow them up is less effective than hollowing them out from within.

On the other hand, there are those who argue it’s a victory for the powerful undertow of bourgeois values over the surface ripples of sexual transgressiveness: gays will now be as drearily suburban as the rest of us. A couple of years back, I saw a picture in the paper of two chubby old queens tying the knot at City Hall in Vancouver, and the thought occurred that Western liberalism had finally succeeded in boring all the fun out of homosexuality.

Which of these alternative scenarios – the demolition of marriage or the taming of the gay – will come to pass? Most likely, both. In the upper echelons of society, our elites practice what they don’t preach. Scrupulously nonjudgmental about everything except traditional Christian morality, they nevertheless lead lives in which, as Charles Murray documents in his book “Coming Apart,” marriage is still expected to be a lifelong commitment. It is easy to see moneyed gay newlyweds moving into such enclaves, and making a go of it. As the Most Reverend Justin Welby, the new Archbishop of Canterbury and head of the worldwide Anglican Communion, said just before his enthronement the other day, “You see gay relationships that are just stunning in the quality of the relationship.” “Stunning”: what a fabulous endorsement! But, amongst the type of gay couple that gets to dine with the Archbishop of Canterbury, he’s probably right.

Lower down the socioeconomic scale, the quality gets more variable. One reason why conservative appeals to protect the sacred procreative essence of marriage have gone nowhere is because Americans are rapidly joining the Scandinavians in doing most of their procreating without benefit of clergy. Seventy percent of black babies are born out of wedlock, so are 53 percent of Hispanics (the “natural conservative constituency” du jour, according to every lavishly remunerated Republican consultant), and 70 percent of the offspring of poor white women. Over half the babies born to mothers under 30 are now “illegitimate” (to use a quaintly judgmental formulation). For the first three-and-a-half centuries of American settlement the bastardy rate (to be even quainter) was a flat line in the basement of the graph, stuck at 2 or 3 percent all the way to the eve of the Sixties. Today over 40 percent of American births are “nonmarital,” which is significantly higher than in Canada or Germany. “Stunning” upscale gays will join what’s left of the American family, holed up in a chichi Green Zone, while, beyond the perimeter, the vast mounds of human rubble pile up remorselessly. The conservative defense of marriage rings hollow because for millions of families across this land the American marriage is hollow. …

Liz Cheney says we have to start fighting back.

… If we don’t defend our freedoms now against the onslaught of President Obama’s policies, we won’t have to wait until our sunset years for American freedom to be a distant memory.

These days Washington careens from crisis to crisis, most of them manufactured. The Obama White House and its allies are engaged in the kind of sky-is-falling melodrama normally reserved for the lives of teenage girls. (As the mother of teenage girls, I speak with authority on this, though the comparison does a disservice to teenagers.) With our attention diverted by each fiscal cliff or sequestration drama, we are at risk of missing the real threats to the republic.

President Obama is the most radical man ever to occupy the Oval Office. The national debt, which he is intent on increasing, has passed $16 trillion. He believes that more government borrowing and spending are the solution to every problem. He seems unaware that the free-enterprise system has lifted more people out of poverty than any other economic system devised by man.

Perhaps his ignorance of that fact explains his hostility toward the private sector. In one of his autobiographies, the president writes that he felt “like a spy behind enemy lines” during his brief stint working for private industry.

The president has launched a war on Americans’ Second Amendment rights. He has launched a war on religious freedom. He has launched a war on fossil fuels. He is working to nationalize one-sixth of the economy with job-killing ObamaCare. He wants to collect a greater portion of every American paycheck, not for the purpose of paying down the national debt but to expand his governing machine. He doesn’t believe in creating a bigger pie with more opportunity for all. He believes in greater redistribution of a much smaller pie. If you’re unsure of what this America would look like, Google”Cyprus” or “Greece.”

The president has so effectively diminished American strength abroad that there is no longer a question of whether this was his intent. He is working to pre-emptively disarm the United States. He advocates slashing our nuclear arsenal even as the North Koreans threaten us and the Iranians close in on their own nuclear weapon. He has turned his back on America’s allies around the world and ignored growing threats. …

Click on WORD or PDF for full content

WORD

PDF

David Harsanyi says don’t give up on obamacare repeal yet. 

P.J. O’Rourke once remarked, “Feeling good about government is like looking on the bright side of any catastrophe. When you quit looking on the bright side, the catastrophe is still there.” With all the doom and gloom free-market advocates must be feeling these days, there’s one truth that should bolster their resolve about the future: The catastrophe will still be there.

Conventional wisdom says that Republicans need a major attitude adjustment on cultural and social views in both substance and tone. That may very well be true. But the concern from Democrats regarding the GOP’s miseries has a tendency to inject one exceptionally terrible piece of advice into the mix: namely, that conservatives should stop griping about Obamacare.

As you all know, there is no such thing in Washington as a flawed government program, only a desperately under-funded one. Ideological rigidity, despite what you may have heard, is not a monopoly of the right. Nevertheless, a law so poorly conceived will surely be poorly implemented. Those who support it will be spending political capital defending it for many coming years.

Obamacare isn’t popular today, and there’s no reason to believe its appeal will grow. Let’s start with the expectations of supporters. For those gullible enough to believe that politicians can make them healthier while constructing more efficient and less expensive systems, there is the promise of dissatisfaction. And for those who support the Affordable Care Act for less ideological reasons, they’ll soon realize that the infinite promises of the theoretical Obamacare can’t match reality. …

Jennifer Rubin posts on an item from Reuters.

Practically nothing about Obamacare is turning out to be what President Obama said it would be. The Medicaid expansion is proving unattractive for a number of governors. Some of these (and others who are buying into the Medicaid expansion) won’t set up the exchanges. The medical device tax is now recognized as anti-technology and anti-jobs. The new taxes and mammoth regulations may be responsible for the lag in full-time job growth and the uptick in part-time work. Its contraception mandate (even after revision) is facing multiple legal challenges from religious institutions and individual employers claiming that it infringes on their religious liberty.

It isn’t bending the cost-curve downward. Reuters reports:

“A new study released on Tuesday by the nonpartisan Society of Actuaries estimates that individual premiums will rise 32 percent on average nationwide within three years, partly as a result of higher risk pools. Changes would vary by state, from an 80 percent hike in Wisconsin to a 14 percent reduction in New York. . . .” ..

Yuval Levin with more.  

As Obamacare begins to roll out, its champions are beginning to have to confront reality. But because they’re getting a lot of leeway and protection from the political press, the results of this confrontation with the consequences of the law’s poor design and misguided economic assumptions often take the form of little nuggets of truth buried in mountains of frantic, wishful obfuscation. Such was the little nugget buried in the middle of a story that was itself buried in the back of the A section of last Friday’s New York Times.

The story was about the enormous challenges of implementing the law, and while it was careful to inform us (in the mouths of unnamed “supporters of the law”) that a lot of these problems are surely functions of the fact that “President Obama has done little to trumpet its benefits, educate the public or answer the critics,” it also notes the following curious fact:

“Mr. Obama scored his biggest legislative achievement exactly three years ago when he signed the Affordable Care Act. But this week the administration cautioned officials to be careful about suggesting that the law would drive down costs.

After extensive research, the administration said it was unwise to tell consumers that they could get “health insurance that fits your budget.” That message, it said, is “seen as highly motivational, but not as believable.”

This makes it sound like the “extensive research” in question was research into public opinion, which it may well have been. But of course, the more fundamental reason “to be careful about suggesting that the law would drive down costs” is that no one really expects it to do so — not even the administration. …

Michael Tanner from National Review has more on the problems that have surfaced.

The Patient Protection and Affordable Care Act, a.k.a. Obamacare,  turned three years old this week. But unlike fine wine, the ACA is not getting better with age. A torrent of recent studies and reports has provided new evidence — as if we needed more confirmation — that nearly everything we were told about this law was untrue.

Compare these promises to what we’ve found out about the law in just the past two months:

“If you like your doctor, you will be able to keep your doctor, period. If you like your health-care plan, you’ll be able to keep your health-care plan, period.”

— President Obama, June 15, 2009

People are finding it increasingly difficult to do what the president promised. According to the California health-care-consulting firm HealthPocket, in a study of more than 11,000 plans on the individual market released this month, less than 2 percent of existing plans are in compliance with the law’s benefit requirements. While current plans are technically grandfathered in, allowing people to keep them for now, any change in the plans requires that their coverage be brought into full compliance, even if that means more expensive plans that include new and unnecessary benefits. Moreover, because non-compliant plans cannot enroll new members, most of the existing plans will eventually disappear, requiring even those members who have been grandfathered in to switch plans eventually.

The same applies to many business plans, especially for employers in the “small group” market. In a survey of small businesses, the National Federation of Independent Business found that 12 percent of companies have already been notified that their current coverage will be canceled or will not be renewed because it doesn’t meet Obamacare requirements.

At the same time, the CBO has raised, from 4 million Americans to 7 million, its estimate of the number of workers who will be dumped from their employers’ health plans and forced into the exchanges. …

Shikha Dalmia thinks medical care will be this president’s Iraq war.

Not even the most ardent defenders of Obamacare — aka the Patient Protection and Affordable Care Act — claim anymore that the law will lower health coverage costs for Americans. How, then, will it achieve universal coverage, its central goal?

The short answer is, it won’t.

Last week, major insurers warned of double-digit premium hikes for small businesses and individuals when Obamacare goes into effect next year. Likewise, the nonpartisan Society of Actuaries this week estimated that costs to insurers that provide coverage to individuals will rise 32 percent on average within the first three years of the law, with premium increases sure to follow.

Similar analyses last year had already forced MIT’s Jonathan Gruber to admit that his projections that the law would lower premiums for young and old alike were wrong — even though his projections were instrumental in securing Obamacare’s passage. Gruber’s revised estimates now show that even the least affected states, such as Colorado, will experience premium hikes of nearly 20 percent by 2016.

Clearly, the word “affordable” should be scratched from the law for the sake of truth in advertising. But what about the “protection” part — namely, universal coverage?

That too is a lie. …

Click on WORD or PDF for full content

WORD

PDF

Chana Joffe-Walt at NPR reports on the alarming increase in disability payments by the Feds. The average monthly Social Security disability payment to a disabled worker is approximately $1,100 in 2012.  For a disabled worker with a spouse and one child, SSA states that the average is approximately $1,900 per month. And, much of this is not taxable.

In the past three decades, the number of Americans who are on disability has skyrocketed. The rise has come even as medical advances have allowed many more people to remain on the job, and new laws have banned workplace discrimination against the disabled. Every month, 14 million people now get a disability check from the government.

The federal government spends more money each year on cash payments for disabled former workers than it spends on food stamps and welfare combined. Yet people relying on disability payments are often overlooked in discussions of the social safety net. People on federal disability do not work. Yet because they are not technically part of the labor force, they are not counted among the unemployed.

In other words, people on disability don’t show up in any of the places we usually look to see how the economy is doing. But the story of these programs — who goes on them, and why, and what happens after that — is, to a large extent, the story of the U.S. economy. It’s the story not only of an aging workforce, but also of a hidden, increasingly expensive safety net.

For the past six months, I’ve been reporting on the growth of federal disability programs. I’ve been trying to understand what disability means for American workers, and, more broadly, what it means for poor people in America nearly 20 years after we ended welfare as we knew it. Here’s what I found. …

… In Hale County, Alabama, 1 in 4 working-age adults is on disability. On the day government checks come in every month, banks stay open late, Main Street fills up with cars, and anybody looking to unload an old TV or armchair has a yard sale.

Sonny Ryan, a retired judge in town, didn’t hear disability cases in his courtroom. But the subject came up often. He described one exchange he had with a man who was on disability but looked healthy.

“Just out of curiosity, what is your disability?” the judge asked from the bench.
“I have high blood pressure,” the man said.
“So do I,” the judge said. “What else?”
“I have diabetes.”
“So do I.”

There’s no diagnosis called disability. You don’t go to the doctor and the doctor says, “We’ve run the tests and it looks like you have disability.” It’s squishy enough that you can end up with one person with high blood pressure who is labeled disabled and another who is not. …

… As I got further into this story, I started hearing about another group of people on disability: kids. People in HaleCounty told me that what you want is a kid who can “pull a check.” Many people mentioned this, but I basically ignored it. It seemed like one of those things that maybe happened once or twice, got written up in the paper and became conversational fact among neighbors.

Then I looked at the numbers. I found that the number of kids on a program called Supplemental Security Income — a program for children and adults who are both poor and disabled — is almost seven times larger than it was 30 years ago. …

Michael Barone posts his initial reaction to the NPR story. He seems a bit naive to Pickerhead. 

Ballooning federal Disability Insurance payments were the subject of my December 2 Washington Examiner column. I drew on my American Enterprise Institute colleague Nicholas Eberstad’s book A Nation of Takers: America’s Entitlement Epidemic and pointed out that between 1996 and 2011, when the nation gained 8.8 million private sector jobs, the disability rolls grew by 4.1, to a total of 8.6 million, 5.6% of the 18-to-64 population.

That’s hugely expensive. “But,” I added, “there is also a human cost. Consider the plight of someone who at some level knows he can work but decides to collect disability payments instead. That person is not likely to ever seek work again, especially if the sluggish recovery turns out to be the new normal.

“He may be gleeful that he was able to game the system or just grimly determined to get what he can in a tough situation. But he will not be able to get the satisfaction of earned success from honest work that contributes something to society and the economy.” …

The Atlantic has more; calling it the country’s $124 billion secret welfare program. 

Imagine for a moment that Congress woke up one morning, realized that the United States was suffering from a paralyzing long-term unemployment crisis, and, in a moment of progressive pique, decided to create a welfare program aimed at middle-aged, blue-collar workers.

The one thing everybody could probably agree on is that it should help all those jobless 50-somethings find employment, right?

Well, as NPR’s Planet Money argues in an eye-opening story, it turns out there already is a “de facto welfare program” for those struggling Americans. The problem is, instead of getting the unemployed back on their feet, it pays them to give up work for good. 

I’m talking about Social Security’s disability insurance program, which over 20 years has quietly morphed into one of the largest, yet least talked about, pieces of the social safety net. Since the early 1990s, the number of former workers receiving payments under it has more than doubled to about 8.5 million, as shown in Planet Money’s graph below. More than five percent of all eligible adults are now on the rolls, up from around 3 percent twenty years ago. Add in children and spouses who also get checks, and the grand tally comes to 11.7 million.

Reihan Salam posts in National Review about the Dutch experience trying to back down their disability program.

… The Dutch reforms, taken together, appear to have had a significant impact on inflows into disability, but a much smaller impact on outflows:

“Experience rating has reduced inflow into the WAO scheme by 13 percentage points, the introduction of the gatekeeper protocol has reduced inflow by 25 percentage points and the tightening of the eligibility criteria has further reduced inflow by 4 percentage points. The additional effect of the WIA is large as well, resulting in a decrease of inflow by 21 percentage points. Interestingly, whereas the effect of the gatekeeper protocol seems to increase over time, the effect of the WIA is decreasing over time.

All these effective policy measures have one thing in common: they focus on preventing inflow. Indeed, prevention is the best way in the long run of keeping claimant numbers low. Only the re‐examinations of the disability stock from 2004 to 2009 caused a significant increase in disability outflow. However, at the same time the re‐examinations boosted outflow, the recovery rates of the population not affected by the re‐examinations decreased sharply, possibly due to the change in the re‐examination periodicity.” 

This makes intuitive sense, as increasing outflows will entail disruption and considerably more political resistance, which makes reducing inflows all the more important.

How about some better news? Tomorrow night at 10:00 little Florida Gulf Coast University (FGCU) will play against the Florida Gators for a chance to advance in the NCAA Men’s Tournament. Sports Illustrated has the story of the school that came from nowhere.

DUNK CITY, Fla. — Florida Gulf Coast coach Dave Tollett fired up his computer the morning after the Eagles became the first No. 15 seed to reach the Sweet 16 in the NCAA men’s basketball tournament. Page after page of unopened e-mails greeted him.

“Four hundred eighty-nine,” Tollett said, smiling.

That might not seem so unusual, except that Tollett coaches FGCU’s baseball team. The bulk of those e-mails came from high school players or their parents. Across the nation, they had watched on television as the Eagles dunked their way to wins against Georgetown and San DiegoState. They had seen the photos of FGCU students marching from their dorms for an impromptu beach party. Less than three days since the basketball team from a relatively anonymous directional school in southwest Florida took the court against Georgetown in Philadelphia, seemingly everyone wanted to play in that magical place known as Dunk City — regardless of sport. “In 72 hours,” Tollett said, “the university has changed.”  …

… Awareness is precisely why former FGCU president William Merwin wanted to start an athletic program. The school opened in 1997 and served primarily as a distance learning center. As the century turned, Merwin decided to change that. He wanted FGCU to give students a more traditional college experience. He wanted a robust campus life. He wanted a Greek system. He wanted sports teams. One of the first athletic department hires was Butch Perchan, the senior associate athletics director for external affairs. Perchan had come from Southern Colorado to live in the warmth of the SunshineState. He got the full Florida experience. The athletic department was housed in trailers as the school worked to clear the surrounding swampland to make it suitable for facilities. “Three beautiful trailers,” Perchan joked. Kavanagh, who wouldn’t arrive in Fort Myers until 2009, isn’t sure he could have handled the pioneer life Perchan enjoyed so much. “Snakes were being moved,” Kavanagh said, “so they could create something.” One of Perchan’s first hires was Tollett, who received $3,500 for the first year he spent recruiting a team.

FGCU’s teams began play in the 2002-03 school year in the NAIA. They moved quickly to NCAA Division II, then reclassified to Division I. One major donor was Ben Hill Griffin III, who has a street named for him on one side of campus and whose agribusiness company’s name is on the arena. It was Griffin’s company that donated all the land on which the university sits. If that name sounds familiar even to sports fans who aren’t familiar with the citrus industry, it’s because Griffin’s father, Ben Hill Griffin Jr., donated so generously to the University of Florida that the school named the football stadium after him. (Ben Hill Griffin III also remains an active donor at Florida.) Another major FGCU donor was the late Duane Swanson, who owned a large building supply company. Swanson befriended Tollett and became one of the program’s biggest benefactors. Once, Swanson became so irked that he couldn’t buy a hot dog during FGCU baseball games that Tollett convinced him to fund the construction of a concession stand. Feeling bold, Tollett then suggested the project should also include a baseball locker room, baseball clubhouse and an office building for the baseball, softball and soccer coaches. Swanson funded all of it. “He’d shed tears over this,” Perchan said of the Sweet 16 run.

Last year was the first for the men’s basketball team as a full member of the NCAA’s Division I. But it is a vast gulf between FGCU’s end of Division I and the one occupied by the Eagles’ Sweet 16 opponent. While FGCU and Florida are considered equals in NCAA Division I legislative matters, the Eagles bear no financial resemblance to the balance-sheet juggernaut from Gainesville they’ll see Friday. …

The Naples Daily News with background for the FGCU story. 

By now, Andy Enfield’s business acumen has been well documented.

Since the Florida Gulf Coast University men’s basketball team dunked its way into the national spotlight, the coach’s eclectic and successful background has captivated the media. Enfield has an MBA, worked on Wall Street, retains a small stake in a company worth more than $100 million and previously started multiple businesses.

Enfield has been tabbed by some as the most interesting man in the NCAA tournament for his past as a businessman. Yet most his success in the basketball world has come as a salesman.

When he took the Eagles head coaching job two years ago, Enfield had to sell players on a team that suffered through four straight losing seasons. He had to get high school kids to come to a school they had never heard of before.

It turns out, for Enfield, it wasn’t as hard as it sounds.

“He didn’t really have to sell the program,” FGCU sophomore point guard Brett Comer said. “He sold himself to me.”

Whatever he said worked. He brought in enough talent and improved the existing Eagles enough to compete with the major college basketball programs in the country. As a result, FGCU is the first No. 15 seed to advance to the Sweet 16 of the NCAA tournament.

While Enfield had never been a head coach, and FGCU had never had a winning season in Division I, he had no problem getting the players he wanted. Recruits were drawn to Enfield not because of his coaching style or system, but because of his penchant for making players better.

Enfield’s coaching experience involved working in player development in the NBA. He was a shooting and development consultant for several teams and dozens of professional players. Knowing they could take their game to the next level, high school recruits were drawn to Enfield. …

Click on WORD or PDF for full content

WORD

PDF

Chip Mellor and Jeff Rowes of The Institute for Justice write a WSJ OpEd on IJ’s recent victory in Louisiana. Pickerhead will confess that The Institute has been one of his favorite charities over the last 20 years. The have the perfect jobs. They spend all their time suing governments. One of their main efforts is to remove licensing regulations that make it difficult for small entrepreneurs to start and operate businesses. Many of the clients are blacks who will be really free and equal when they learn to hate all governments; local, state, and federal. 

The Fifth U.S. Circuit Court of Appeals on Wednesday struck down a Louisiana law that made it a crime for the Benedictine monks of St. Joseph Abbey to sell their handmade caskets. The decision sets up what may become a historic confrontation at the U.S. Supreme Court over one of the most important unresolved questions in constitutional law: May state governments enact economic regulations simply to protect politically connected special interests from competition?

This story begins 1,600 years ago when Benedict of Nursia founded an order of monks and instructed them to put bread on their table through the labor of their own hands. Following this dictate, the entrepreneurial brothers of St. Joseph Abbey—a century-old monastery in Covington, La.—opened a tiny business on All Souls’ Day in 2007 to sell the unadorned wooden caskets that they have made for generations.

That’s when their ancient ways collided with modern America. The monks had not sold a single casket before the Louisiana State Board of Funeral Directors—acting on a complaint from a government-licensed funeral director—shut them down. In Louisiana, the government had made it a crime to sell caskets in the state without a license. To do so, the monks would have had to transform their monastery into a funeral home, including building an embalming room, and at least one of the monks would have had to leave the order to spend years becoming a licensed funeral director. All of that just to sell a wooden box.

David Harsanyi says the sequester scare is not working.

… It seems to me that folks too easily conflate serious economic shocks (a downgrade) with less shocking developments (a cut in the growth of government spending). If we’re making assumptions, why not assume that  our confidence is sinking because Obamacare and all its taxes are closer to implementation.

A Rasmussen poll found that only 12 percent of Americans believe the sequester has had a major impact on them personally. And the number experiencing a major impact was unchanged from week the sequester first took effect. If the president had been open to prioritization of sequester cuts almost no one would have noticed the cuts. Blaming sequestration for every economic hiccup (or worse) is going to become the hobbyhorse of a lot of people in the next few months.  With or without evidence.

Law Prof Jonathan Turley, writing in USA Today says looks like Nixon has won. At least that is what Turley thinks when he sees the present imperial presidency.

This month, I spoke at an event commemorating the 40th anniversary of the Watergate scandal with some of its survivors at the National Press Club. While much of the discussion looked back at the historic clash with President Nixon, I was struck by a different question: Who actually won? From unilateral military actions to warrantless surveillance that were key parts of the basis for Nixon’s impending impeachment, the painful fact is that Barack Obama is the president that Nixon always wanted to be.

Four decades ago, Nixon was halted in his determined effort to create an “imperial presidency” with unilateral powers and privileges. In 2013, Obama wields those very same powers openly and without serious opposition. The success of Obama in acquiring the long-denied powers of Nixon is one of his most remarkable, if ignoble, accomplishments. Consider a few examples: …

Mort Zuckerman says the great recession has been followed by the grand illusion. 

The Great Recession is an apt name for America’s current stagnation, but the present phase might also be called the Grand Illusion—because the happy talk and statistics that go with it, especially regarding jobs, give a rosier picture than the facts justify.

The country isn’t really advancing. By comparison with earlier recessions, it is going backward. Despite the most stimulative fiscal policy in American history and a trillion-dollar expansion to the money supply, the economy over the last three years has been declining. After 2.4% annual growth rates in gross domestic product in 2010 and 2011, the economy slowed to 1.5% growth in 2012. Cumulative growth for the past 12 quarters was just 6.3%, the slowest of all 11 recessions since World War II.

And last year’s anemic growth looks likely to continue. Sequestration will take $600 billion of government expenditures out of the economy over the next 10 years, including $85 billion this year alone. The 2% increase in payroll taxes will hit about 160 million workers and drain $110 billion from their disposable incomes. The Obama health-care tax will be a drag of more than $30 billion. The recent 50-cent surge in gasoline prices represents another $65 billion drag on consumer cash flow.

February’s headline unemployment rate was portrayed as 7.7%, down from 7.9% in January. The dip was accompanied by huzzahs in the news media claiming the improvement to be “outstanding” and “amazing.” But if you account for the people who are excluded from that number—such as “discouraged workers” no longer looking for a job, involuntary part-time workers and others who are “marginally attached” to the labor force—then the real unemployment rate is somewhere between 14% and 15%. …

Denis Prager on Florida Atlantic’s falderal.

Question: What is the difference between Christian seminaries and American universities?

Answer: Christian seminaries announce that their purpose is to produce committed Christians. American universities do not admit that their primary purpose is to produce committed leftists. They claim that their purpose is to open students’ minds.

This month FloridaAtlanticUniversity provided yet another example of how universities have become left-wing seminaries.

An FAU professor told his students to write “JESUS” (in bold caps) on a piece of paper and then step on it.

One student who did not, a junior named Ryan Rotela, complained to the professor and then to the professor’s supervisor. He explained that he had refused to do so because it violated his religious principles.

Two days later, Rotela was told not to attend the class anymore. …

Telegraph, UK with an update on progress with OneWorldTradeCenter.

Manhattan’s One World Trade Center, aka “The Freedom Tower” or the most politicised, high-profile skyscraper in the world, is clearly visible from every approach to the city. And when you’re at the top you can see every approach in return.

On the 104th floor, roughly 1,370ft above the bustle of the city, construction workers move about the steel skeleton with the agility of monkeys, creating plumes of flame and showers of sparks with their torches and grinding gear.

When it’s completely fitted out by the end of this year, One World Trade Center, or 1 WTC, is destined to be the tallest office tower in the western hemisphere, and the third tallest building in the world.

But, like so much else about the building, that’s a contentious claim. The tallest-tower designation depends on whether you accept that its 408ft spire is an extension of the tower or a separate antenna.

Call it an antenna and the building will be 400ft shy of its projected height of 1,776ft. The building’s manager and owner, the Port Authority of New York and New Jersey, along with the governors of New York and New Jersey, New York’s Mayor Bloomberg, as well as families of those killed in the twin towers on September 11 2001, insist “The Freedom Tower” will be completed with the majesty of 1776 symbolism – the year of American independence – intact.

Whichever way that decision goes, the building that’s up is itself very different to the shard-like Daniel Libeskind design selected in 2003. With its wind turbines and “sky gardens”, that design was never considered practical by Larry Silverstein, the fast-talking developer who held the leases on the destroyed towers. …

Click on WORD or PDF for full content

WORD

PDF

Charles Krauthammer proposes tax reform with a twist.

… tax reform with a twist.

The problem begins with definitions. By tax reform, Obama means eliminating deductions, exclusions, credits of various kinds with all the money going to the Treasury.

That’s radically new. The historic 1986 Reagan-O’Neill tax reform closed loopholes with no extra money going to the Treasury. The new revenue went directly back to the citizenry in the form of lower tax rates.

This is called revenue-neutrality. The idea is that tax reform is a way not to fatten the Treasury but to clean the tax code. It means eliminating special-interest favors and behavior-altering deductions that create waste and inefficiency by inducing tax-preferred rather than market-oriented economic activity. And it introduces fairness by removing breaks and payoffs for which only the rich can afford to lobby.

As a final bonus, tax reform’s lower rates spur economic growth. A unique win-win-win: efficiency, fairness, growth.

Obama’s own Simpson-Bowles deficit-reduction commission offered a variant. First, it identified an astonishing $1.1 trillion per year of these “tax expenditures.” That’s more than $11 trillion in a decade. In one scenario, it knocked them all out and lowered marginal tax rates to just three brackets of 8 percent, 14 percent and 23 percent.

But here’s the twist. Using the full $1.1 trillion annually of newly redeemed “loophole” revenue, Simpson-Bowles could have dropped the rates a bit below 23 percent. But instead it left some of that money in the Treasury, an average of almost $100 billion a year, or about $1 trillion over a decade. It was a reasonable compromise, so reasonable that even the Senate’s most fierce spending hawk, commission member Tom Coburn, signed on.

Now, Simpson-Bowles is not on the table but it could be a model. Obama’s “tax reform” would send 100 percent of the revenue to the Treasury. Reagan-O’Neill sent 0 percent. Simpson-Bowles fell somewhere in between. So should any grand compromise. …

Andrew Malcolm posts on Biden’s hotel bills.

Good thing, given sequestration’s cuts in spending increases, that the Obama administration has curtailed spending like canceling this spring’s White House public tours.

Otherwise, the administration might be in big financial trouble, like the country they’re allegedly leading, given the Vice President’s recent European hotel tabs.

The cost of the night’s London lodging in early February for Joe Biden and his unusually large entourage was $459,388.65. That’s right, nearly a half-million dollars, which would be a BFD for anyone who wasn’t self-appointed political royalty.

But that’s not the worst of it. In Paris, the Amtrak-lover from Delaware ran up another one-night hotel tab of more than a half-million dollars, $585,000.50. They must have hit that mini-bar pretty hard!

The Weekly Standard, which broke the stories of these extremely expensive expense extravaganzas, also discovered the five-star hotel stays at the Hotel Intercontinental Paris Le Grande and London’s Hyatt Regency were made through no-bid government contracts. That eliminates any messy money-saving competition and security concerns.

That was Joe’s first foreign trip of the second term (only 1,397 days left). He’s since made another, to Rome last week for Pope Francis’ first mass. …

Interesting WSJ OpEd on the intelligence of animals.

Who is smarter: a person or an ape? Well, it depends on the task. Consider Ayumu, a young male chimpanzee at KyotoUniversity who, in a 2007 study, put human memory to shame. Trained on a touch screen, Ayumu could recall a random series of nine numbers, from 1 to 9, and tap them in the right order, even though the numbers had been displayed for just a fraction of a second and then replaced with white squares.

I tried the task myself and could not keep track of more than five numbers—and I was given much more time than the brainy ape. In the study, Ayumu outperformed a group of university students by a wide margin. The next year, he took on the British memory champion Ben Pridmore and emerged the “chimpion.”

How do you give a chimp—or an elephant or an octopus or a horse—an IQ test? It may sound like the setup to a joke, but it is actually one of the thorniest questions facing science today. Over the past decade, researchers on animal cognition have come up with some ingenious solutions to the testing problem. Their findings have started to upend a view of humankind’s unique place in the universe that dates back at least to ancient Greece.

Aristotle’s idea of the scala naturae, the ladder of nature, put all life-forms in rank order, from low to high, with humans closest to the angels. During the Enlightenment, the French philosopher René Descartes, a founder of modern science, declared that animals were soulless automatons. In the 20th century, the American psychologist B.F. Skinner and his followers took up the same theme, painting animals as little more than stimulus-response machines. Animals might be capable of learning, they argued, but surely not of thinking and feeling. The term”animal cognition” remained an oxymoron.

A growing body of evidence shows, however, that we have grossly underestimated both the scope and the scale of animal intelligence. Can an octopus use tools? Do chimpanzees have a sense of fairness? Can birds guess what others know? Do rats feel empathy for their friends? Just a few decades ago we would have answered “no” to all such questions. Now we’re not so sure. …

CBS Sports says FloridaGulfCoastUniversity’s men’s basketball team is the biggest thing in sports. You’ll have to wait until Friday for their next game.

The funny thing is that they’re just as loose off the court as they are on it, full of great stories and quotes, happy to talk to anybody and everybody. And, yes, they’re just as blown away by all of this as you are. They admit it and display it.

“Wow,” said Florida Gulf Coast‘s Eric McKnight when I told him his ridiculous and vicious alley-oop was trending on Twitter. Then I told him he and his teammates are the biggest story in sports. Not just college basketball. Sports. All of sports. Including everything.

“Really?” McKnight asked. “Wow. Wow. Wow. This is all very hard to believe.”

Perhaps because it’s unprecedented.

Florida Gulf Coast made history here Sunday at the Wells Fargo Center with an 81-71 victory against San Diego State that made the Eagles the first 15 seed in NCAA tournament history to advance to the Sweet 16. So now the greatest (and newest) show in college basketball — Florida Dunk Coast — is headed to Jerry Jones’ Dallas Cowboys Stadium. To play the University of Florida. For a trip to the Elite Eight. And how perfect is this story?

This Atlantic Sun member that didn’t hold its first class until 1997 is now an international deal, and not only because it’s in the Sweet 16. No, it’s more than that. It’s the way the Eagles did this, how they got here. With lobs on lobs on lobs on lobs and dunks on dunks on dunks on dunks. Understand, this remarkable run — which started Friday against Georgetown and continued with this destruction of SDSU — didn’t feel fluky. For 80 consecutive minutes, Florida Gulf Coast was the aggressor, the attacker, way more than merely a so-called low-major getting fortunate by hitting lots of 3-pointers.

That said, they weren’t that sharp in the opening 20 minutes Sunday.

McKnight was asked what coach Andy Enfield’s halftime speech entailed.

“He [told us we] played like s— in the first half,” McKnight said, matter-of-factly. “Then he brought us all together and told us to turn up. So that’s what we did.” …

Click on WORD or PDF for full content

WORD

PDF

Mark Steyn remembers why we went to war 10 years ago.

Ten years ago, along with three-quarters of the American people, including the men just appointed as President Obama’s secretaries of state and defense, I supported the invasion of Iraq. A decade on, unlike most of the American people, including John Kerry and Chuck Hagel, I’ll stand by that original judgment.

None of us can say what would have happened had Saddam Hussein remained in power. He might now be engaged in a nuclear arms race with Iran. One or other of his even more psychotic sons, the late Uday or Qusay, could be in power. The Arab Spring might have come to Iraq, and surely even more bloodily than in Syria.

But these are speculations best left to the authors of “alternatives histories.” In the real world, how did things turn out?

Three weeks after Operation Shock and Awe began, the early bird naysayers were already warning of massive humanitarian devastation and civil war. Neither happened. Over-compensating somewhat for all the doom-mongering, I wrote in Britain’s Daily Telegraph that “a year from now Basra will have a lower crime rate than most London boroughs.” Close enough. Major-General Andy Salmon, the British commander in southern Iraq, eventually declared of Basra that “on a per capita basis, if you look at the violence statistics, it is less dangerous than Manchester.”

Ten years ago, expert opinion was that Iraq was a phony-baloney entity imposed on the map by distant colonial powers. Joe Biden, you’ll recall, advocated dividing the country into three separate states, which for the Democrats held out the enticing prospect of having three separate quagmires to blame on Bush, but for the Iraqis had little appeal. “As long as you respect its inherently confederal nature,” I argued, “it’ll work fine.” As for the supposedly secessionist Kurds, “they’ll settle for being Scotland or Quebec.” And so it turned out. The Times of London, last week: “Ten Years After Saddam, Iraqi Kurds Have Never Had It So Good.” In Kurdistan as in Quebec, there is a pervasive unsavory tribal cronyism, but on the other hand, unlike Quebec City, Erbil is booming.

What of the rest of the country? Iraq, I suggested, would wind up “at a bare minimum, the least badly governed state in the Arab world, and, at best, pleasant, civilized and thriving.” I’ll stand by my worst-case scenario there. Unlike the emerging “reforms” in Tunisia, Libya, Egypt and Syria, politics in Iraq has remained flawed but, by the standards of the grimly Islamist Arab Spring, broadly secular.

So I like the way a lot of the trees fell. But I missed the forest.

On the previous Western liberation of Mesopotamia, when Gen. Maude took Baghdad from the Turks in 1917, British troops found a very different city from the Saddamite squat of 2003: in a lively, jostling, cosmopolitan metropolis, 40 percent of the population was Jewish. I wasn’t so deluded as to think the Jews would be back, but I hoped something of Baghdad’s lost vigor might return. …

WSJ Editors with more on the background of Thomas Perez. 

President Obama nominated Thomas Perez on Monday to run the Labor Department, praising him as “a consensus-builder” who passed the nation’s “first statewide living-wage law” in Maryland. That isn’t his only talent. Consider how Mr. Perez worked behind the scenes to undermine two civil cases against the City of St. Paul in order to stop a Supreme Court case that might have repudiated his discrimination enforcement theories.

These columns first reported on the curious St. Paul episode in February 2012 (“Squeezed in St. Paul”), after the Minnesota city withdrew a case that it had spent almost a decade litigating and that the U.S. Supreme Court had already agreed to hear. We’ve since learned more about how it happened, and we’ve seen emails that illustrate the strong-arm role played by Mr. Perez in his current job as head of the Justice Department’s Civil Rights Division. It’s a story of how political muscle undermined the rule of law.

Mr. Perez is a champion of disparate-impact theory, which purports to prove racial discrimination by examining statistics rather than intent or specific cases. Soon after Mr. Perez assumed his job in October 2009, Attorney General Eric Holder established a unit under Mr. Perez to examine loans to minorities. The unit proceeded to threaten a series of lawsuits against banks under the 1968 Fair Housing Act.

The lenders quickly settled these cases rather than run the reputational risk of being called racist in court. But on November 7, 2011 the Supreme Court agreed to hear the City of St. Paul’s appeal in Magner v. Gallagher, which concerned the legality of disparate-impact theory in housing. St. Paul believed it had an excellent chance to prevail because the text of the Fair Housing Act doesn’t explicitly allow for disparate impact.

That’s when the Obama Administration kicked into gear. On November 17, Mr. Perez emailed a former colleague, Thomas Fraser at the Fredrikson & Byron law firm in Minnesota, to probe if city officials might be convinced to withdraw Magner, according to documents that the Justice Department sent to Congressional investigators. Mr. Fraser referred Mr. Perez to his colleague, David Lillehaug, who was advising St. Paul on a pending False Claims Act case against the city filed by a private citizen.

Mr. Perez had stumbled onto a potential quid pro quo: The feds could decline to intervene in the false claims case (known as Newell) in exchange for the city withdrawing Magner from the Supreme Court. But that was no sure thing. The Department of Housing and Urban Development had already recommended that Justice join the Newell lawsuit against St. Paul. On November 22, Justice’s career staff in the Civil Division’s civil fraud section conveyed that recommendation in a memo to Civil Division chief Tony West for his approval. …

John Fund on the war against jobs.

Senate Democrats finally released their first budget plan in four years this month: It offers nearly $1 trillion in new taxes, an end to sequester budget savings, and almost no new spending restraint. Despite the failure of the 2009 stimulus package, Democrats also want an extra $100 billion to create jobs on infrastructure projects, few of which would be “shovel-ready” enough to hire workers anytime soon. 

President Obama won’t release his own budget till April, but he has a golden opportunity to improve on the Senate budget and create real jobs. All he has to do is end his four-year delay in approving the Keystone XL pipeline, which would bring crude oil produced from Canada’s oil sands to refineries on the GulfCoast. It is already “shovel-ready” — portions of it are already under construction. And because it’s being built by private-sector companies, any new pipeline jobs would come at zero cost to the taxpayers and the economic activity created would provide significant tax revenues.

Keystone has been completely scrubbed environmentally. Four government reports have been issued on its impact, all with essentially the same conclusion. The latest came this month, from the U.S. Department of State. It raised no major objections and concluded, as AP notes, “Other options to get the oil from Canada to U.S. Gulf Coast refineries are worse for climate change.” Nor will all the piped oil be Canadian: Keystone will provide a safe, reliable method of transporting 250,000 barrels of oil a day from the Bakken fields of North Dakota to refineries.

A key finding of State’s report is that the Canadian oil fields are so big — the world’s third-largest reservoir of oil — that they will almost certainly be developed. The question becomes whether the oil will be sent south to the U.S. by our friendly Canadian neighbor or shipped west to China and other Asian powers. …

David Harsanyi has a rip at Jerry Rivers, aka Geraldo Rivera. 

As the Weekly Standard first noted, President Barack Obama gave an impassioned speech in Ramallah, imploring all sides to find a way to peace — under a rather large banner of terrorist Yassir Arafat. Peculiar, yes. Few people have rushed to the president’s defense, but these days producers have the extraordinary ability to find someone who’ll say anything to be on television.

Ladies and gentleman, Geraldo Rivera.

Noah Rothman lays out the conversation. Appearing on Fox and Friends, Geraldo frames his comments as  dispassionate analysis of the former Palestinian militant/terrorist/what-have-you leader, but he gives himself away with some profoundly dumb comments.

For starters, Geraldo lays this on the hosts: “Arafat is generally regarded as the George Washington of the Palestinian people.”

Generally regarded? Generally? The adverb? In most cases? Usually?

In March of 1978, twelve Fatah terrorists, acting on the blessing of the George Washington of the Palestinian people, landed on a beach near Tel Aviv with Kalashnikov rifles, mortars and explosives. They immediately shot an American journalist named Gail Rubin, before walking up to a four-lane highway and murdering 38 civilians, 13 of them children, and wounding another 71. This event is still celebrated in the West Bank so perhaps it’s the Boston Tea Party of the Palestinian movement. Someone should ask Geraldo. …

Walter Russell Mead comments on the Financial Times reports of economic chaos in Venezuela.

… Venezuela’s economic woes are telling. Apologists for Chavez mentor Fidel Castro blame Cuba’s sixty years of economic problems on the US embargo. If it weren’t for Uncle Sam, they say, Castro would have built a socialist paradise by now.

Venezuela is the test for this talking point. Not only is there no US embargo in Venezuela, but the country also has huge oil reserves. And what does it have? Food and medicine and foreign currency shortages. A socialist paradise, indeed.

Forbes with a story about the stupidity of the latest attack on Wal-Mart.

If you thought Mayor Bloomberg’s failed assault on certain large sodas sold in certain kinds of stores was arbitrary and capricious, get ready for a similarly bizarre attempt to punish large retailers.

The latest foolish attack on Walmart is happening, fittingly, in a committee hearing in Washington, D.C., a town that is reminding us all how it is even more obtuse on the local level than on the national. The salvo is called the Large Retailer Accountability Act (LRAA), but just think of it as yet another effort from the DGDP: the Department of Good Deeds Punishment.

For its sin of providing millions of working class Americans with good service, broad selection and low prices, Walmart might as well have painted a (Target-style) bullseye on itself among progressives. Walmart is at last preparing to enter the nation’s capital, with plans well underway for six stores in the District, two of them set to open this year.

Away from the tourist trail, the District still contains some blighted neighborhoods where crime and disorder discourage business and leave residents starved for corporate attention. Walmart has eagerly been reviving desolate corners of the city.

In order to punish this good deed, though, the rebarbative chairman of the D.C. City Council, Phil Mendelson, has been pushing an extraordinary new law that would apply only to large national retailers, with more than $1 billion in sales, who open D.C. stores of greater than 75,000 square feet. Such firms would be required to pay a “living wage” of at least $11.75 an hour to all employees — a 62 percent premium over the federal minimum wage. D.C. already has its own super-minimum wage of $8.25 an hour (set by law at $1 above the federal minimum). So the LRAA is a super-duper minimum wage proposed mainly to punish a single company, which is why wags in the press are calling it the Walmart Living Wage Bill. …

Click on WORD or PDF for full content

WORD

PDF

USA Today OpEd on our Mid-East policy in tatters. 

President Obama’s first journey to Israel as president comes amid earth-shattering change in Middle East, much of it for the worse. The Arab Spring, which once raised hopes of freedom and dignity, has diverged onto the dark path of Islamist authoritarian rule. In Syria, tens of thousands of people have died in a bitter civil war that might have recently seen its first use of chemical weapons. And Iran continues its march toward nuclear weapons capability, heedless of international condemnation. Obama’s effort to seek peace between Palestinians and Israelis is in tatters.

That’s why the White House has been lowering expectations for Obama’s trip to Israel all this week. He will announce no new peace plan, grand design or major foreign policy initiative. His advisers are calling the trip a “listening tour.” That is what you call a state visit when you have little to say.

Despite downgrading the trip, many see Obama’s arrival as the sequel to his 2009 visit to Cairo, where he announced a “new beginning” with the Muslim world. Four years later, that doesn’t auger well for renewed efforts in Israel and the West Bank. …

Interesting post from Roger Simon on CA’s freeway gypsy encampments.

On our way to downtown Los Angeles Saturday night for the annual Churchill Dinner of the Claremont Institute at the venerable Biltmore Hotel, my wife Sheryl and I took the Hollywood Freeway, a route we had taken uncountable times before.

Only something was different.  Small encampments of homeless had been set up on the edge of the freeway.  We were used to them under freeway bridges, but these were more elaborate, makeshift tents and blankets positioned on slopes along the freeway, so that, we speculated, they were in full view of the constant passing traffic.  That way the violence frequently visited on the homeless by themselves and by others would at least partly be discouraged.

I was reminded of Victor Hanson’s poignant descriptions of the California Central Valley and also of when I lived in Southern Spain and would see impoverished gypsy encampments along the roads to Grenada and Seville.  But that was decades ago and that part of Spain, Andalucia, was desperately poor then, struggling to play catch up with the rest of Europe. It did — for a while anyway.

The Hollywood Freeway was not so simple.  This was a parade of the haves and have-nots, Mercedes and Lexuses, streaming past the tattered homeless:  Obama’s America.

The president has a solution to this problem, even as it gets worse.  Tax those folks in the Mercedes. Only that’s been tried a thousand times, most notably in the Great Depression, and it never worked. For someone so versed in Frankfurt School “critical theory,” the president has a convenient way of forgetting history.

He prefers, as we know, the pursuit of “fairness,” but in so doing he has seemed to make things less fair.  The stock market is up at the same time as the number of those who have dropped out of the labor force reached a jaw-dropping 89 million in January.   I wouldn’t be surprised to find gypsy encampments along all the freeways soon. African-Americans, as we also all know, have been hurt worst of all.

And yet Obama’s adversaries are accused of racism. La vie à l’envers, life upside down, as the French say. …

Fouad Ajami reminds us why we invaded Iraq ten years ago. 

Nowadays, few people step forth to speak well of the Iraq War, to own up to the support they gave that American campaign in the Arab world. Yet Operation Iraqi Freedom, launched 10 years ago this week, was once a popular war. We had struck into Afghanistan in 2001 to rout al Qaeda and the terrorists’ Taliban hosts—but the 9/11 killers who brought ruin onto American soil were not Afghan. They were young Arabs, forged in the crucible of Arab society, in the dictators’ prisons and torture chambers. Arab financiers and preachers gave them the means and the warrant for their horrific deeds.

America’s previous venture into Iraq, a dozen years earlier, had been a lightning strike: The Iraqi dictator was evicted from Kuwait and then spared. Saddam Hussein’s military machine was all rust and decay by 2003, but he swaggered and let the world believe that he had in his possession a deadly arsenal of weapons of mass destruction. The Arab redeemer, as he had styled himself, lacked the guile that might have saved him. A great military expedition was being readied against him in London and Washington, but he gambled to the bitter end that George W. Bush would not pull the trigger.

On the eve of Operation Iraqi Freedom—the first bombs fell on March 19—well over 70% of the American public supported upending the Saddam regime. The temptation to depict the war as George W. Bush’s and Dick Cheney’s is convenient but utterly false. This was a war waged with congressional authorization, with the endorsement of popular acceptance, and with the sanction of more than a dozen United Nations Security Council resolutions calling for Iraq’s disarmament. …

In spite of the unpopularity of ”nation building”, Max Boot says we better learn how to keep those skill sets.  

There are two essential lessons one can draw from the Iraq War: either that we should never get mired in counterinsurgency or “nation-building” operations in the future or that, if we do get involved, we should do a better job of achieving our objectives. The prevailing wisdom in Washington adheres to the former position, but I believe the latter lesson offers more useful guidance for the future.

No less an eminence than Bob Gates, on his way out the door as secretary of defense, proclaimed, “In my opinion, any future defense secretary who advises the president to again send a big American land army into Asia or into the Middle East or Africa should ‘have his head examined,’ as General MacArthur so delicately put it.” Although he subsequently walked back that statement, it is fair to say that Gates’ view is now the conventional wisdom.

But is it—to borrow the favored term of Gates and others—“realistic” to argue that we will never get involved in another major ground war? No one could have imagined on September 10, 2001, that we would shortly be fighting in Afghanistan, nor can anyone imagine what the future will bring. Suffice it to say, when one looks at the wide arc of instability stretching from West Africa to Central Asia, it is hard to rule out in advance that U.S. ground troops will ever be dispatched into harm’s way. …

Corner post says the Iraq war was right, the rhetoric was wrong.

I supported the Iraq War from the start. I supported it so much that as the anti-war movement built momentum at home and around the world — and as key members of the U.N. Security Council failed to support a new resolution authorizing the invasion — I felt anxious that President Bush would blink. Yes, I believed that Saddam Hussein had a stockpile of WMDs, but I also believed there were ample additional (and sufficient) reasons to invade: He was violating the Gulf War cease-fire accords, he was shooting at our pilots on a daily basis, he was a prime financial supporter of the Palestinian suicide bombing offensive in the Second Intifada, and he tried to kill a former American president. All those events occurred after he had previously launched two offensive wars (against Iran and Kuwait) and gassed his own people. Both the Authorization for the Use of Military Force in Iraq (2002) and the Iraq Liberation Act (1998) detail Saddam’s many sins, yet even these Acts of Congress fail to provide the full list.

In other words, there were legal, moral, and strategic grounds for war even absent weapons of mass destruction.

Yet it was here that we made a terrible rhetorical mistake. By grounding the public case for war so solidly in the existence of large and dangerous stockpiles of existing weapons — rather than making the more complete case for war — when those stockpiles didn’t exist (much to the surprise even of many Iraqi generals) to a great many Americans the reason to fight simply disappeared.

Minding the Campus has more on the administrative pigs at NYU.

For John Sexton, president of New York University, March came in a like a lion.  In one aggravating week Sexton found himself the subject of two biting stories in the press: a no-confidence vote from faculty and focus on $72 million in unexplained  NYU loans to Jack Lew and many others.  The first was merely embarrassing.  The second could endanger Sexton’s powerhouse position at NYU.

Ironically, Sexton and his university may be victims of their own success.  For decades NYU has steadily enlarged its huge footprint, and now plans to add two million more square feet to its campus in historic (and crowded) Greenwich Village.  NYU has elbowed aside community protests and even tore down a house where Edgar Allen Poe once lived, despite loud objections from many of its own faculty.

One of the main complaints of last week’s faculty vote of no-confidence in Sexton is that he places financial objectives ahead of academic pursuits, while limiting faculty participation in shaping the university’s future.  Sexton,  who earns $1.5 million a year, with a $2.5 million bonus waiting in the wings, has been asked  by Senator Charles Grassley (R-Iowa) to hand over documents concerning loans and other fringe benefits it paid out over the last 10 years.  Grassley also wants information on the university’s generous compensation packages and details on how they were calculated. …

Click on WORD or PDF for full content

WORD

PDF

20 years ago Pickerhead traveled to Russia some, and even then, the movement of suitcases of cash from Moscow to Cyprus was legendary. Streetwise Professor explains how the looting of Cyprus bank depositors by the EuroProject is a direct hit on Russians. His post is titled; Cyprus: The essence of FUBAR (F__ked Up Beyond All Recognition).

If you’ve been waiting your entire life to witness the pure, un-adulturated, distilled essence of FUBAR, your dreams have been answered: for behold Cyprus!

For in one fell swoop, the with their monster mash of a bailout-bail-in of Cyprus, the Eurotards have succeeded in: gutting the rule of law and due process; riding roughshod over democratic institutions; increasing the risk of a catastrophic bank run in the event any Eurozone country (e.g., Spain) is believed to need to seek assistance; and sparking a huge diplomatic row with Russia.  Well played! Well played, indeed!

For those dwelling under a rock: as part of a 10 billion euro bailout for Cyprus, the Euros (meaning primarily Germany) required the imposition of a tax on deposits in Cypriot banks: a 6.75 percent tax on deposits below 100,000 euros, and 9.99 percent on deposits above 100K euros.

The bail-in essentially guts deposit insurance, which allegedly protects deposits below 100K.  A run on Cypriot banks is almost inevitable, because who is to say that this haircut is the last?  What’s worse, depositors in other peripheral banks have to take seriously the prospect that they will be similarly expropriated, in the event that their banks and/or sovereigns (to the extent this distinction has any meaning) require a Eurozone bailout. …

… All in all, it is hard to imagine how the Eurocrats could have played this any worse.  They didn’t really solve Cyprus’s debt problem.  They made it all the harder to deal with debt and banking problems outside of Cyprus.  They committed a major foreign policy blunder.  A truly amazing trifecta.

One final thought.  This points out the absurdity of the Euro project.  If tiny Cyprus is too big to fail, if the effects of its default would be so horrible that the Euro mandarins feel it necessary to take such a desperate and dangerous measure to prevent it, how can the Euro be anything but an absurdity?

More on Cyprus from Ambrose Evans-Pritchard in Telegraph, UK.

One’s first reflex is to gasp at the stupidity of the EU policy elites, but truth is that most EU officials handling the Cyprus crisis know perfectly well that their masters have just set the slow fuse on a powder keg – and they can only pray that it is slow.

The decision to expropriate Cypriot savers – even the poorest – was imposed by Germany, Holland, Finland, Austria, and Slovakia, whose only care at this stage is to assuage bail-out fatigue at home and avoid their own political crises.

This latest debacle has caught me on the hop, literally, since I am in Tokyo learning about Abenomics, so let me just make a few quick points before going off for a pint of sake.

The EU creditor states have at a single stroke violated the principle that insured EU bank deposits of up $100,000 will be guaranteed come what may, and in doing so they have more or less thrown Portugal under a bus.

They appear poised to seize large sums from Russian banks – €1.3bn from state-owned VTB alone, and therefore from the Kremlin – prompting the condign riposte from Vladimir Putin that the action is “unfair, unprofessional and dangerous.”

They have demonstrated that the rhetoric of EMU solidarity is just hot air, that they will not force their own taxpayers to share a single cent of clean-up costs for the great joint venture of monetary union – in which northern banks, insurers, pension funds, and indeed governments, were complicit.

Their refusal to pay is entirely understandable in one sense – and if I were a German taxpayer, I would not care to swallow these losses either – but then the leaders of these creditor countries can hardly expect the world to believe that they will in fact do whatever it takes to hold EMU together. Quite obviously, they will not. …

Walter Russell Mead examines the Detroit detritus. Here’s how he sums it up.

… The best way to stop future tragedies like this is to enforce the law. From voting fraud to corrupt relations with contractors and financiers to fraudulent accounting on pensions, many American cities are being run more like criminal conspiracies than anything else. And the cost isn’t just the money the politicians steal, or the inflated profits that those doing business with a crooked city can earn or even the sweetheart deals with public sector unions who function as part of the machine. It is the shambolic education offered to generations of poor kids, the lack of protection for person and property, the burden of a government that is both costly and ineffective and the enterprises and jobs such a government kills or drives away: corrupt big city machines may be the most important single civil rights issue in America today.

This is not, repeat not, a black thing. Historically, most of America’s worst urban machines have been white criminal enterprises. Often in American history, a combination of identity politics, fear and hopes of getting scraps from the machine have prevented poor people in the cities from organizing against their criminal masters. In the past it was often progressives and middle class reformers, some of the same ethnicity as most of the victims, others from different groups, who banded together to drive out the crooks. The criminals did their best to smear the reformers and identity politics was part of their shtick. Tammany Hall accused its critics of being anti-Catholic or anti-Irish bigots. Prosecutors who attacked the mafia were called anti-Italian. And so it goes.

Urban machines have a legitimate place in American politics. New waves of immigrants into urban America — whether from Europe, Asia, Latin America or the rural South — benefit from organizing to protect their economic and political issues. The machines allow them to assert themselves, claim a share of city patronage and business, and direct city resources to communities that might otherwise be overlooked.

But unchecked and uncontrolled, these machines have a tendency to go over the line. Graft proliferates; crony appointments degrade the quality of governance to the point that city administration is no longer able to function. This is where the reformers come in, pushing back against the tendency of political machines to jump the shark, imposing some limits and discipline on what goes on. Partly because today’s progressives are moral cowards who have allowed themselves to be shamed by the race card, this process of balance and reform didn’t really get underway in Detroit (and perhaps elsewhere) until enormous damage had already been done.

By overlooking the corruption and a mafia thinly disguised as a political party for so long, the authorities of the United States deprived the citizens of Detroit of the equal protection of the law. That must not happen in our other cities; municipal government in this country needs to be much more transparent, and law enforcement really needs to crack down.

Without this, all the federal block grants or social programs in the world will not help those trapped in the inner cities escape poverty and get the education and skills they need to build the kind of future all Americans want.

This is the pre-eminent civil rights problem of our day and is devastating minority communities throughout the country. Our political establishment, our university faculties and fashionable intellectuals, our newspaper editorialists, our legal profession and our clergy stand essentially silent; it is the silence of shame.

Robert Samuelson says our country is becoming one vast old-age home.

… We don’t need a charm offensive; we need a candor offensive. The budget debate’s central reality is that federal retirement programs, led by Social Security and Medicare, are crowding out most other government spending. Until we openly recognize and discuss this, it will be impossible to have a “balanced approach” — to use one of President Obama’s favorite phrases. It’s the math: In fiscal 2012, Social Security, Medicare, Medicaid and civil service and military retirement cost $1.7 trillion, about half the budget. If they’re off-limits, the burdens on other programs and tax increases grow ever greater.

It’s already happening. The military is shrinking and weakening: The Army is to be cut by 80,000 troops, the Marines by 20,000. As a share of national income, defense spending ($670 billion in 2012) is headed toward its lowest level since 1940. Even now, the Pentagon says budget limits hamper its response to cyberattacks. “Domestic discretionary spending” — a category that includes food inspectors, the FBI, the National Weather Service and many others — faces a similar fate. By 2023, this spending will drop 33 percent as a share of national income, estimates the Congressional Budget Office. Dozens of programs will be squeezed.

Nor will states and localities escape. Federal grants ($607 billion in 2011) will shrink. States’ Medicaid costs will increase with the number of aged and disabled, which represent two-thirds of Medicaid spending. All this will force higher taxes or reduce traditional state and local spending on schools, police, roads and parks.

The budget debate may seem inconclusive, but it’s having pervasive effects. Choices are being made by default. Almost everything is being subordinated to protect retirees. Solicitude for government’s largest constituency undermines the rest of government. This is an immensely important story almost totally ignored by the media. One reason is that it’s happening spontaneously and invisibly: Growing numbers of elderly are simply collecting existing benefits. The media do not excel at covering inertia. …

You might have seen the recent reports of ancient mummies with hardened arteries and concluded lifestyle choices offer little help in preventing the disease. Not so fast says Whole Health Source blog.

… However, I do want to make a few key points about the study and its interpretation.  First, all groups had atherosclerosis to a similar degree, and it increased with advancing age.  This suggests that atherosclerosis may be part of the human condition, and not a modern disease.  Although it’s interesting to have this confirmed in ancient mummies, we already knew this from cardiac autopsy data in a variety of non-industrial cultures (2, 3, 4, 5).

The more important point is that atherosclerosis does not equal heart attack.  Atherosclerosis is an important risk factor, but extensive cardiac autopsy studies have suggested that traditional cultures with near-zero heart attack incidence have coronary atherosclerosis (6, 7, 8, 9).  Although they tend to have less atherosclerosis than industrial populations when adjusted for age, differences in atherosclerosis alone cannot explain their remarkable resistance to heart attacks: other factors must be involved.  These could include the tendency of the blood to clot, the tendency of atherosclerotic plaque to rupture, and perhaps the diameter of the coronary vessels.  

Some have used the mummy paper to argue the view that it’s silly to try to eat like our ancestors because they got sick just like we do.  The paper does not support this view, for two reasons.  First, as I said previously, atherosclerosis is not the only risk factor for heart attacks, and we have extensive cardiac autopsy data from multiple non-industrial cultures indicating that the actual rate of heart attacks was very low, even when adjusted for age (10, 11).  And second, although arterial calcification was common in all cultures represented by the mummies, it was less common in the coronary arteries, where it matters most for heart attack risk. ..

Click on WORD or PDF for full content

WORD

PDF

Joel Kotkin writes about the scarcity of start-up enterprises since the last downturn.

On Wall Street, even as layoffs mount, the upper echelons are clinking champagne glasses for good reason. The stock market is hitting new highs, propelled largely by Bernanke dollars and strong corporate profits. Big financial institutions like Wells Fargo and JPMorgan have announced record profits.

But on Main Street, for the most part, the mood is far more subdued. Big business may be flourishing, but small business is still in recession. The number of startup jobs per 1,000 Americans over the past four years fell a full 30% below the levels of the Bush and Clinton eras. The Ewing Marion Kauffman Foundation, a nonprofit that studies startups, estimates that the rate of new business formation in the U.S. has fallen to a record low. The number of startups in 2011 was lower than in 1994, when the economy was smaller, as was the workforce and population.

According to the BLS, smaller firms accounted for two thirds of all net jobs added between 1992 and 2007, a figure much cited by small business advocates. (This is hotly disputed by labor-backed economists, who have traditionally downplayed entrepreneurial ventures since they are not amenable to organizing.)

But whatever the actual percentages, the weakness of smaller, and particularly newer firms, is one key reason for our current, persistent job shortfall. This time around, as a recent Brookings study reveals, larger businesses came out of the recovery stronger, not their beleaguered smaller counterparts.

Big businesses often drive the economy but newer, smaller ones, historically, have created the jobs. If the U.S. had come out of the recession maintaining the same rate of startup formation as in 2007, notes McKinsey, we would today have almost 2.5 million more jobs.

The problem is that in many ways, the recession never ended for small business. The reductions in small business employment during the fourth quarter of 2008 and in 2009 were the largest ever recorded in the history of the National Federation of Independent Business data series. And now, as we enter the sixth year since the onset of the Great Recession, more than four years after the “recovery” officially began, small business remains in a largely defensive mode. Hiring and startup rates have been far less dynamic than in the aftermath of the downturns of 1976 and 1983. …

David Harsanyi says our large debt matters a lot. 

No worries, America. Debt is a preoccupation of the fringe, a mere distraction for anyone interested in progress. And anyway, as President Barack Obama explained this week, “we don’t have an immediate crisis in terms of debt. In fact, for the next 10 years, it’s going to be in a sustainable place.”

That’s a pretty convenient position, wouldn’t you say, for a man who’s helped pile on trillions of dollars of new debt and created an entitlement that promises to escalate this non-crisis crisis of ours? Problem is that there are a few trillion things wrong with this contention.

The most obvious hitch is that neither this president — whatever we think of him or he thinks of himself — nor anyone else, even the best-intentioned economist or technocrat, can foresee what’s in store. Judging from our recent history — the wars, economic downturns, natural disasters, fake emergencies, bailouts, etc. — there will be plenty of new reasons to create debt we haven’t accounted for in our future. …

David Harsanyi reminds us that in 2006, the junior senator from Illinois made this speech on the floor of the senate. He grew up to be a reckless spendthrift president.

… Despite repeated efforts by Senators CONRAD and FEINGOLD, the Senate continues to reject a return to the commonsense Pay-go rules that used to apply. Previously, Pay-go rules applied both to increases in mandatory spending and to tax cuts. The Senate had to abide by the commonsense budgeting principle of balancing expenses and revenues.

Unfortunately, the principle was abandoned, and now the demands of budget discipline apply only to spending. As a result, tax breaks have not been paid for by reductions in Federal spending, and thus the only way to pay for them has been to increase our deficit to historically high levels and borrow more and more money. Now we have to pay for those tax breaks plus the cost of borrowing for them. Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next 5 years. That is why I will once again cosponsor the Pay-go amendment and continue to hope that my colleagues will return to a smart rule that has worked in the past and can work again.

Our debt also matters internationally. My friend, the ranking member of the Senate Budget Committee, likes to remind us that it took 42 Presidents 224 years to run up only $1 trillion of foreign-held debt. This administration did more than that in just 5 years. Now, there is nothing wrong with borrowing from foreign countries. But we must remember that the more we depend on foreign nations to lend us money, the more our economic security is tied to the whims of foreign leaders whose interests might not be aligned with ours.

Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘‘the buck stops here.’’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better. I therefore intend to oppose the effort to increase America’s debt limit.

IBD Editors say another jackboot has been placed on the throat of the economy.

The president reportedly will tell federal agencies they can’t approve major projects until their impact on global warming has been weighed. Why halt commerce in an economy in dire need of more?

According to Bloomberg media, “President Barack Obama is preparing to tell all federal agencies for the first time that they should consider the impact on global warming before approving major projects, from pipelines to highways.”

Bloomberg says Obama plans to “expand the scope of a Nixon-era law,” the National Environmental Policy Act, “that was first intended to force agencies to assess the effect of projects on air, water and soil pollution.”

It’s happening just as Obama threatened it would: If Congress won’t pass the laws he wants — in this case limits on greenhouse gas emissions — he will just make law on his own, without constitutional restraint.

At risk under such a regime are “natural gas export facilities, ports for coal sales to Asia, and even new forest roads,” Bloomberg reports industry lobbyists as saying.

To that list we’d add fracking, which has produced a historic domestic energy, economic and employment boom. …

Reason Magazine corrects the latest liberal smear of Clarence Thomas.

In Django Unchained, director Quentin Tarantino’s bloody ode to the spaghetti western set in the pre−Civil War American South, Samuel L. Jackson portrays the despicable character of Stephen, the head house slave on a hellish Mississippi plantation. Reviewing the film for The Boston Globe, critic Wesley Morris struggled to convey the villainy of Stephen’s character, turning to a present-day comparison for help. “The movie is too modern for what Jackson is doing to be limited to 1858,” Morris wrote. “He’s conjuring the house Negro, yes, but playing him as though he were Clarence Thomas.”

It was not the first time a liberal writer had taken a cheap shot at the conservative Supreme Court justice. New York Times reporter Linda Greenhouse once described Justice Antonin Scalia as Thomas’ “apparent mentor,” yet we now know that Thomas has been the one quietly influencing Scalia’s jurisprudence. But the comparison to the slave power system was particularly contemptible, especially because no Supreme Court justice since Thurgood Marshall has written more frequently or powerfully about American racism than Thomas.

Consider his role in the 2003 case Virginia v. Black, which involved a state law criminalizing the burning of a cross “with the intent of intimidating any person or group of persons.” While most of his colleagues focused on First Amendment law, Thomas offered a different view. The law was intended to counteract “almost 100 years of lynching and activity in the South” by the Ku Klux Klan and other hate groups, he reminded the courtroom during oral argument. “This was a reign of terror, and the cross was a symbol of that reign of terror.”

When the case was decided several months later, Thomas went further in a lone dissent, arguing that cross burning was part and parcel of that racist terrorism and therefore deserved no protection under the First Amendment. “Those who hate cannot terrorize and intimidate to make their point,” he wrote. …

Jason Riley on the horror show nominated for secretary of labor.

President Obama has nominated Thomas Perez, head of the Justice Department’s Civil Rights Division, to be the next secretary of labor. The White House cites as an attribute his work at Justice in settling several fair-lending cases involving banks. But Republicans ought to question Mr. Perez’s fondness for using statistical analysis to bring discrimination cases.

Mr. Perez is a disciple of “disparate impact theory,” which uses statistics (selectively) to “prove” discrimination. As the economist Walter Williams has noted, disparate-impact theorists worship at the altar of racial proportionality. If blacks are 13% of the population, they should be roughly 13% of police officers, dentists, UCLA’s freshman class and residents of upscale suburbs like Scarsdale, N.Y. If they aren’t, then racial discrimination is to blame and legal action against institutions, municipalities, businesses and landlords is warranted. …

More on this terrible appointment from J. Christian Adams. 

Today, President Obama issues a challenge to Republican Senators: in nominating Tom Perez as Labor secretary, he implies that Senate Republicans don’t have either the guts or organizational skill to stop what would become perhaps the most radical left-wing cabinet member in history.

Whether the president is right about GOP senators remains to be seen.

As they say, I wrote the book on Tom Perez. My New York Times bestseller Injustice: Exposing the Racial Agenda of the Obama Justice Department is largely a catalog of the rancid racialism over which Perez has presided.

The New Black Panther case is one small part. But so are the eighth-grade transvestite lawsuits in New York, and so are the race quotas in New York City. PJ Media has been covering Perez in a way that no other outlet has for the last three years: his wars on peaceful Catholic pro-life protesters, his dishonesty under oath, and his overruling of career DOJ lawyers in the South Carolina Voter ID case are but three more from a long list of radical transgressions.

Make no mistake — that’s why Obama appointed him.

Obama knows power is fleeting. You have a short amount of time to affect a large amount of change. He knows Perez is an unapologetic leftist from the Hugo Chavez-wing of the Democrat Party. (Not an exaggeration: Chavez once had Citgo make a payment to Perez’s illegal alien advocacy group Casa de Maryland.) …