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American government spending will be higher in 2011 than it was in 2010. Government spending will be higher in 2012 than it was in 2011 – much higher. The above is all that matters – everything else is piss and wind. The deal is one great big shining lie. – Paul Marks August 2nd, 2011 | 14 comments - (Comments are closed)
 “Little does Barack Obama understand that he has forever branded himself as an incompetent and failure. His narcissism and lifelong history of receiving public adulation will not allow him to comprehend the damage. He does not understand that now few will listen to his speeches, no matter how well delivered; that few will believe what he is saying, as he has lied and obfuscated the facts so often. Many world leaders have already arrived at the conclusion that Barack Obama is a leader that cannot be trusted, the citizens of the United States are beginning to understand that he is a man without a core set of principles thus incapable of guiding the ship of state. The media, increasingly realizing their culpability in the nation’s current state of affairs, has begun to ask more penetrating questions and grudgingly question Obama’s fitness for office. Columnists once infatuated with his ability to deliver a speech and skin color have finally begun to admit their error. The Left has become more open in their criticism, as they now understand that the hero upon whom they vested so much hope is a hollow shell.” August 1st, 2011 | 27 comments - (Comments are closed)
Ideas matter, and especially to intellectuals like President Obama. He is not a rigid ideologue and is capable of flexible maneuvering. But his interpretation of history, his attitude toward sovereignty, and his confidence in multilateral institutions have shaped his views of American power and of American leadership in ways that distinguish him from previous presidents. On Libya, his deference to the UN Security Council and refusal to serve as coalition leader show that he cares more about restraining America than about accomplishing any particular result in Libya. He views Libya and the whole Arab Spring as relatively small distractions from his broader strategy for breaking with the history of U.S. foreign policy as it developed in the last century. The critics who accuse Obama of being adrift in foreign policy are mistaken. He has clear ideas of where he wants to go. The problem for him is that, if his strategy is set forth plainly, most Americans will not want to follow him. – The Obama Doctrine Defined by Douglas J. Feith and Seth Cropsey July 31st, 2011 | 22 comments - (Comments are closed)
At this point it might be useful to clarify precisely what the dispute concerns. The question is not whether the federal government should grow. As Reason’s Nick Gillespie pointed out a few days ago, nearly nobody in Washington has actually proposed shrinking the leviathan. To the contrary, the dispute is whether to raise federal spending from the current $3.8 trillion to $4.7 trillion over the next decade (the Paul Ryan plan) – or to $5.7 trillion (the Obama plan). Bear in mind that those increases would come on top of one of the fastest expansions of federal spending in U.S. history. When President Obama took office, the budget stood at $2.9 trillion. Two. Point. Nine. So the USA is screwed… and does this remind you of something? July 29th, 2011 | 9 comments - (Comments are closed)
Reading about the arrest of what appears to have been an extremist planning an attack on Ft Hood, Texas, I was struck by the contrast with the Oslo attack last weekend.
The point being that a legal gun shop owner is more likely to call the police than a black market arms supplier would. Now if we could only get all the gun rights people in America to realise the advantages of legal outlets for drugs as well… July 28th, 2011 | 18 comments - (Comments are closed)
A few years back, I proposed an alternative budget for the UK. IIRC, it involved cutting taxes by a quarter, spending by a third. Even assuming no increase in economic growth (that would boost sales tax revenue), this would have created a massive budget surplus that could have cut the UK national debt by over 10%. I opposed default then for what I still think were good reasons: first, many private individuals and institutions bought bonds in good faith; but second, because the UK nearly had to surrender to Nazi Germany in 1940, and had refused to confront Hitler when war was still not necessary partly because of the consequences of a partial default on war bonds from the First World War. In essence, appeasement was the necessary policy of 1930s British governments because they could not expect to borrow so had to pay in gold and whatever the British public could be persuade/forced to raise (yes I know pacifism was big too, but the financial imperative meant that it was the only option). Whether we take an interventionist view or not, the re-militarization of the Rhineland in 1936 was the moment when, without firing a shot, Hitler could have been stopped. What does this have to with events in Europe and the USA today? In short, I think the financial situation is so dire, and the political solutions on offer so inadequate, that default is now the only credible outcome. I therefore conclude that it needs to happen very soon, rather than after wasting more resources on more “bail-outs.” We will just have to take our chances that no one decides to, invade the Falklands, or grab Gibraltar, or build nuclear weapons and give them to terrorists, or blow up US embassies. I explain why below. → Continue reading: The debt ceiling should be cut not raised July 28th, 2011 | 10 comments - (Comments are closed)
July 23rd, 2011 | 3 comments - (Comments are closed)
There is an interesting discussion at the Cafe Hayek blog about how much it matters that Americans don’t currently save very much. Well, given that real interest rates (taking into account inflation) are negative, and that holding cash means real wealth declines, it is not surprising that real savings have been steadily eroded. The blog’s author is certainly right about this point, however:
Of course if I can nit-pick, I would make the point that when, say, Chinese investors bought oodles of US government bonds in the years leading up to the credit crunch of 2008, it helped drive US long-term interest rates even lower, hence encouraging even more US domestic consumer spending and borrowing, a process we know went horribly wrong. (The main culprit in all this was the Federal Reserve, not China, I should point out). Of course, if non-domestic savers are channeling those savings into investments that yield a positive future return, such as investments in technological innovations, new products and services, then that’s all to the good. If we were to move away from fiat money to a commodity-based monetary system and 100 per cent reserve banking for demand deposits, then a savings culture would be encouraged considerably. At present, persuading people to save is understandably hard because people, even if they are not hard-money zealots like me, smell that there is something rotten with our money. In some ways, I see parallels between the loss of faith in paper money and the declining credibility of the AGW crowd. I think it was Brian Micklethwait of this blog who said something along the lines that we have had junk science, and now junk money. There is only so much junk that human civilization can stand. July 21st, 2011 | 17 comments - (Comments are closed)
When people burned to death in the UK because first responders failed to do their job, I considered it the UK Socialist disease which we all know has progressed to a stage that is nearly terminal. I did not believe such a thing could happen in the US. I did not think we produced cowards of such grandious scale. But we do. First responders, both Police and Fireeman let a suicidal man drown because the water was too cold and they might have got a chill. Awww. Those poor little children. The got their pretend fire and police helmets for Christmas some years back and never realized that real first responders have to do very dangerous things and put their lives on the line to save people. Their job is to risk death that others might live. I hope the people of Alameda County fire all of them and hire some adults. I suspect there are quite a lot of military Vets who have the guts and determination to actually do the job. I wish we could kick them out of the USA. They are an embarrassment. July 21st, 2011 | 35 comments - (Comments are closed)
As briefly mentioned in a post below, people – a lot of them who seemed to be classical liberal stirrers like yours truly – gathered in the sun-lit gardens in front of the US Embassy, Grosvenor Square, to witness the unveiling of a statue of Ronald Reagan. I like this editorial in CityAM by Allister Heath, who signs off with these two paragraphs. His comment about JF Kennedy is very much on point:
Well said. In a spirit of fairness, though, I link to an interview with Reagan’s former budget director, David Stockman, who is a fierce critic of the deficits (he also strikes me as somewhat embittered). I am not sure if his call for tax rises in the absence of any serious spending cuts is going to find any welcoming audience. I also think Stockman is far too dismissive of the fact that because of the Reagan supply-side tax cuts, revenues boomed. As Heath says, hero-worship is something any genuine liberal should avoid. The list of heroes in public affairs is, as far as I can judge, short. Reagan is one of them. July 5th, 2011 | 10 comments - (Comments are closed)
It bemuses me that a certain type of commentator will often – sometimes rightly – be angered at the over-reach of Western powers’ foreign policy but be quieter about other, less obvious, intrusions if they happen when a more leftist government happens to be in power. And a lot of this sort of double-standard occurs with the United States. Such critics appear to have been silent on the following issue: under the current Democrat presidency of Mr Obama, the US last year passed a stunningly badly crafted piece of legislation, known as FATCA (Foreign Account Tax Compliance Act). The law was passed at a time of what can best be described as hysteria about the amount of money that Americans were allegedly stashing abroad in places such as Switzerland, the Bahamas, the Caymans, and so forth. The major governments of the world, such as the US, Germany and UK, fondly imagine that there is, so to speak, a huge pot of gold that got lost down the back of the sofa. What FATCA does is require any financial institution that is believed to deal with expat US citizens and Green Card holders to provide a great deal of information to the Internal Revenue Service. In other words, all manner of financial institutions, ranging from big banks to small investment boutiques, must prove to the Internal Revenue Service’s satisfaction that they have not got US citizens/GC holders on their books if they want to be unmolested by the IRS’s powers. If they have such clients or invest into the US stock market, etc, they must provide huge amounts of additional reporting data to the US. “Foreign Financial Institutions” must report investors who are taxable in the US to the US tax authorities. If they fail to do so, they pay a 30 per cent withholding tax. And proving that someone is, or might be, a US citizen might be hard, particularly if that person has been living outside the US for decades, and there is not much paperwork going back, say, 30 years. This is a quite stunning extension of the IRS’s power around the world, affecting European, Asian, African, Latin American and other regions’ banks, who may have been blissfully unaware that some of their clients had, at any point, a US “taint”. And I am frankly astonished that not more has been said by non-US governments about this; however, given that governments such as those of Germany have resorted to the dubious practice of paying for data stolen from Swiss banks, I have no great hopes that respect for sovereignty or the rule of law applies. The net effect of this law will be to make it even less likely that banks and other firms will want to touch Americans living outside the US due to the heavy compliance cost. The law will be a blow against globalisation and business growth, as this article at Forbes makes clear. It will be even less profitable for firms to deal with Americans if they live abroad. Those US nationals working in the City of London, for example, will find it is harder to open a bank account, manage a mutual fund or get insurance. A former US colleague of mine is in a nasty predicament. When I called the US Embassy here about the matter, I received nothing but blank ignorance. FATCA is yet another blow against the free movement of people around the world, and will be particularly tough on the middle class, hard-working professionals who don’t have access to the flashiest lawyers and advisors. The super-rich and well-connected will, of course, be okay. I doubt that someone like the US Ambassador or military types serving abroad have even heard of it. (The US military tends not to be affected by such legislation anyway, although you can never be sure. If any serving personnel do get hit, it would be good to know the details). It is sometimes said, by a certain type of sneering European or self-hating international travelling American, at how bad it is that all those ghastly, ignorant hicks don’t hold passports. Well, part of the reason is that getting a passport is a bureaucratic nightmare in the US. Another is that the US is a big and beautiful place with so much to see that why would any sane American want to leave for any extended period of time? But another reason is that the IRS, which is out of control, is making the process of being an expat a waking nightmare. As for whether politicians of any kind, including the Tea Party crowd, give a flying f**k about this issue, is unclear. There may be few votes in it, but I would have more respect for supposedly libertarian-leaning GOP members such as Ron Paul, his son, or one or two others, if they could be persuaded to lobby for wholesale repeal of this atrocious piece of legislation. June 29th, 2011 | 75 comments - (Comments are closed)
If you only go to IMAO occasionally (like me), or even not at all, then allow me to pass on a recent Frank J-ism (if you will pardon the expression) which made me smile if not laugh out loud, from here:
I think a negative maybe got wrongly doubled sowhere near the beginning of that, but you get the point. My approximate understanding of voters is that they do indeed vote about the immediate future, rather than reward or punish politicians for their past deeds or misdeeds, the most famous case being how British voters booted out Churchill in 1945, despite his triumphant war leadership, but because of his presumed inability to win the peace. He won in 1951 not because of his heroic past, but because of what he was then saying: set the people free. Obama is now tanking in the polls because the US economy is now experienced as bad. If it feels like the US economy is heading in the right direction come election day, Obama could indeed win. I could go on, but prefer to leave commenters who actually live in the USA, like Paul Marks, to take that further, if they care to. I will only say that I vividly recall being told, by a visiting American at the time when President Bill Clinton was riding very low in the polls during his first term, that he had zero chance of winning again. But, he did. Also, I was amazed by this FJ revelation:
I did not know that. So, she probably doesn’t know that much about Obama’s re-election chances either. June 22nd, 2011 | 49 comments - (Comments are closed)
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