October 9, 2013

Click on WORD or PDF for full content

WORD

PDF

Here on the Virginia Peninsula bordered on the north by the York River, east by the Chesapeake Bay and south by the James, we have many federal facilities including those owned and operated by the national park service, the folks Mark Steyn said have become the “shock troops of the punitive bureaucracy.” The local paper, The Daily Press had a story today about one small business caught up in the country wide problems caused by the federal government’s Barrycades.

When Carrot Tree manager Glenn Helseth ran into the family of a long-time patron over the weekend who had hoped to celebrate her 100th birthday this week at the restaurant’s Yorktown location, he knew what he had to do.

“That’s when my resolve to open up began,” he said Tuesday.

The Carrot Tree restaurant’s Yorktown location opened at 11 a.m. Tuesday after being closed for a week as a result of the federal government shutdown. The restaurant was forced to close on Oct. 1 because of its location on Main Street in the Cole Digges House, which is owned by the National Park Service.

Park service policy requires that all concessions close during a federal government shutdown. The Carrot Tree is considered a concessioner. Rep. Rob Wittman‘s Yorktown office, which is located in a park service building next door to the Carrot Tree, is allowed to remain open because it operates under a lease that does not provide services to visitors. …

 

John Fund reminds us of the 100th birthday of the income tax.

… The income tax has also changed America. In 1956, Howard Buffett, a former conservative Nebraska congressman and the father of the much more liberal investor Warren Buffett, gave a speech decrying the tax’s pernicious effects:

“The last 40 years have seen a gigantic expansion of political power over economic affairs by the federal government. The change is linked by many scholars to the passage of the income tax law of 1913. This law revolutionized the taxing system in two ways:

1. It gave the government new powers over the economic status of the individual. This change has curtailed the ability of the individual to achieve economic independence.

2. The part of his production taken from the producer cumulatively increases the power of the federal government proportionately with the increase in its income. This power is not created. It is simply taken away from the people.”

Some will claim the government-shutdown fight is about Obamacare. Others will say it is about the long-term debt we are loading onto future generations. Liberals will claim it’s about Republicans’ petulance in the face of bills we must pay. But in no small part it is also about the size and scope of the federal government that the income tax ushered in exactly a century ago. That’s why it’s so fitting that the shutdown battle is happening right now. It’s time for rhetoric that rises above partisanship. It’s time for some reflection about what kind of country we’ve become — thanks to the income tax.

 

A happier celebration comes from the 30th anniversary of the month of September 1983 when the Reagan recovery was starting to take effect. That was the month when our economy added 1,114,000 jobs. The administration throws a party when the number gets north of 200,000 and that’s with an economy one third larger. Even factoring in the 640,000 jobs created by the end of an AT&T strike, we still had a growth of 750,000 in one month. James Pethokoukis has the story.

No September jobs report today, but oh to have been covering the economy when the September 1983 jobs report came out.

Back then, the BLS reported net new payrolls of 1,114,000. That’s right, over a million net new jobs in just one month. The Reagan Recovery was on.

That number is even more amazing when you consider the US labor force was a third smaller back then. The equivalent number of jobs today would be more like 1.6 million. In a single month. By contrast, analysts were looking for nonfarm payroll growth this month of around 180,000.

For all 1983, the US economy added 3.5 million new jobs, followed by 3.9 million in 1984.

Update: It has been noted that the September 1983 jobs number benefited roughly 640,000 AT&T workers returning from a strike. But even if you factor those jobs out, there were roughly 750,000 jobs created that month on a 2013 equivalent basis. Now that’s a jobs recovery!

 

Remember back in the aftermath of Hurricane Katrina when people who flooded the area with needed items were often referred to in derogatory terms for their “profiteering.” How is that different from one of the left’s heroes – Warren Buffett?  WSJ has the story of his profits from the troubles of others during the storm that hit our financial system in the last few years. The vigorish on the loan to B of A would make a loan shark proud. Pickerhead thinks people should be free to contract whether paying a high price for a generator or for a loan.

Billionaire Warren Buffett tossed lifelines to a handful of blue-chip companies during the financial crisis. Five years later the payoff on those deals is becoming clear: $10 billion and counting.

Mr. Buffett approached that figure after he collected another hefty payment last week, bringing to nearly 40% the pretax income on his crisis-era investments, according to a Wall Street Journal analysis.

The bounty is a vivid illustration of one of Mr. Buffett’s favorite investing maxims: “Be fearful when others are greedy, and be greedy when others are fearful.” …

… Mr. Buffett’s stake in Bank of America could pay off for years. Berkshire invested $5 billion in the bank in 2011, which adds about $300 million in annual pretax income. Bank of America Chief Executive Brian Moynihan recently said he doesn’t plan to buy back the preferred shares any time soon. Berkshire also has until 2021 to exercise warrants for 700 million common shares for an additional $5 billion at $7.14 a share. Based on the bank’s current stock price of about $14, the warrants create a paper profit of nearly $5 billion.

 

We opened today with a story about federal thugs making life difficult for citizens. We close with an editorial from the San Diego Union-Tribune which notes the administration had plenty of warning about the looming problems paying death benefits to fallen soldiers, but did nothing.

… On Wednesday, CNN reported that on Sept. 27, days before the shutdown began, the Pentagon was already telling reporters it planned to suspend death benefits.

So for two weeks, the Obama administration has been anticipating this nightmare would come to pass — and did nothing to pre-empt it. Only when the Pentagon began denying death benefits and the backlash began did the White House realize this ploy was a political misstep and seek a fix.

It is an appalling commentary on the president and his administration that they chose to bully the families of dead American soldiers for perceived political gain.

Shame on Barack Obama.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>