Friday Digest

Digest

Mar. 6, 2009

GOVERNMENT & POLITICS

News from the Swamp: The omnipork bill

Senate Republicans managed to block the $410 billion omnibus spending bill Thursday in a small and likely short-lived victory. The bill, which the House passed last week, is an effort to complete nine appropriations bills left over from FY 2009. Democrats were forced to prepare a stopgap budget resolution to keep the government running through Tuesday – heaven forbid the federal government shut down for the weekend.

The profligate spending of the omnibus is losing support among even some Democrat members of Congress, particularly those from red states. Sen. Evan Bayh (D-IN) blasted the bill, saying, “The Senate should reject this bill. If we do not, President Barack Obama should veto it.” Bayh cited the fact that the budget increases discretionary spending by eight percent over last year, twice the rate of inflation.

Sen. John McCain (R-AZ) led a charge this week against the nearly 9,000 earmarks in the bill, introducing an amendment to strip all earmarks from the Senate version. The amendment was defeated 63-32 with only two Democrats voting with McCain, and eight Republicans voting for spending as usual. “They are focused on talking about one percent of this bill,” complained Senate Majority Leader Harry Reid (D-NV). It might be only one percent, but that’s almost $4 billion.

According to The New York Times, “The spending bill includes earmarks requested by lawmakers who have died, by others who have retired and still others who have been indicted for corruption.” And Heritage Foundation budget analyst Brian Riedl estimates that the bill actually contains 9,287 earmarks, not the 8,500 to 9,000 others claim. “As far as I can tell, this is likely the most earmarks ever in a single piece of legislation.” In 2005, the year with the most earmarks on record, there were 13,977 for the whole year.

Also this week, Taxpayers for Common Sense released a report on the biggest congressional porkers of fiscal 2009. Sen. Robert Byrd (D-WV) topped the list with $120 million worth of earmarks, but second on the list was Sen. Richard Shelby (R-AL) with $114 million. Minority Leader Mitch McConnell (R-KY) came in at number nine with $51 million, doubling the pork of his Senate counterpart, Harry Reid. We suppose that as long as pork is the favorite appetizer on Capitol Hill, Republicans are bound to play by those rules. But a little principle would be welcome.

The BIG lie

“This is a remarkably fiscally responsible budget. I don’t think we’ve been this fiscally responsible in a very long time.” –Tax-Cheatin’ Treasury Secretary Timothy Geithner

Income Redistribution: Details of Obama’s mortgage plan

“The Obama administration announced details of a housing-rescue plan it said would help as many as one in nine homeowners, from low-income Americans struggling to avoid foreclosure to well-off borrowers who owe more than their homes are worth,” reports The Wall Street Journal. The plan allocates $75 billion for aid to as many as nine million mortgage holders.

The plan offers subsidies for mortgage companies of up to $3,500 per troubled mortgage as well as other incentives to sweeten the deal. Financially burdened borrowers will have to sign an affidavit declaring their financial hardship. Interest rates for those borrowers will then be cut to as low as two percent as part of an effort to bring their monthly payment down to about 31 percent of their income. Borrowers could also receive up to $5,000 to reduce principal balances. Redistribution is limited to those with principal balances not exceeding $729,750, and is limited to five years.

The Journal continues, “The second main component of the plan calls for Fannie Mae and Freddie Mac, the government-backed mortgage giants, to refinance loans for millions of borrowers who may owe more than their homes are worth, even if they are wealthy enough to afford their current payments. There is no income ceiling for beneficiaries. But they must have mortgages held or guaranteed by Fannie Mae or Freddie Mac, and they cannot owe more than 105% of the current value of their home.” (Click here to find out if you, too, can qualify.)

Meanwhile, according to the Associated Press, “The number of people who were late making their mortgage payments shot up 53 percent in the fourth quarter of 2008 from the same period in 2007.” We’re sure this is unrelated to Obama’s plan, but we thought it was worth a mention.

Also noteworthy is that Obama failed to save 651,000 jobs in February, hampering his efforts to “save or create” 3.5 million jobs. The monthly loss was the worst since 1949. The economy has now lost 2.5 million jobs since Obama’s election and 4.4 million since December 2007. The unemployment rate is 8.1 percent. So this is hope and change?

Health care at a sickening cost

Back in the Great Society era, Social Security was expanded to include Medicare. When the program was introduced, Americans were assured that it would not become a costly drain on the federal budget. But almost every year for the past 40, the cost of Medicare has increased at a faster rate than the cost of private insurance. The federal government now is responsible for 47 percent of all health care costs.

Despite Barack Obama’s protestations to the contrary, the $634 billion promised to pay for his ambitious health care plan won’t cover its estimated $1 trillion cost over the next decade. And as we have seen before with both Medicare and Medicaid, projected revenues and cost savings are viewed by federal bean counters with the rosiest-tinted glasses available.

Most troubling are the looming tax increases on the owners of small businesses. They will soon bear the brunt of Obama’s plan to reduce charitable deductions for wealthier taxpayers. In theory, these increases will cover about half the planned cost, but because taxpayers tend to do their best to avoid paying full freight, it’s assured that either the deduction rules will need to be tightened still further or (more likely) the income thresholds for qualification lowered. It seems the private-sector health care condition in this nation may soon be downgraded to critical and unstable.

In related news, Obama selected Kansas Governor Kathleen Sebelius to head the Department of Health and Human Services after his first choice, former Senate Majority Leader Tom Daschle, was forced to withdraw when he was found to be a tax cheat. In 2007, Sebelius called on Kansas lawmakers to “commit themselves to universal [health] coverage.” She is also vociferously pro-abortion and vetoed several bills that would have imposed modest restrictions on the practice. HHS boasts a $700 billion budget and Sebelius would have significant influence on abortion policy.

One policy up for review is George W. Bush’s conscience-based protections for physicians who refuse to perform certain procedures, including abortion, for moral reasons. Unfortunately, “review” could mean “revocation.”

New & notable legislation

The Senate passed two riders to the bill granting Washington, DC, House representation last week. One of them, the Broadcaster Freedom Act, passed 87-11 and presumably puts an end to any attempt by the federal government to regulate the political content of the airwaves as promoted by the so-called Fairness Doctrine. However, another much less publicized rider that passed by a party-line 57-41 vote will “encourage and promote diversity in communication media ownership” and “ensure that the public airwaves are used in the public interest.” The FCC can interpret this deliberately vague language, written by Sen. Dick Durbin (D-IL), to mean that the agency has the power to redistribute broadcast licenses to any organization that it believes best serves the public good. In other words, it’s a back-door “Fairness Doctrine,” as organizations like ACORN and MoveOn.org will become media barons in the liberal attack on free political speech.

Sen. Jim DeMint (R-SC) and a group of congressional Republicans have introduced the Secret Ballot Protection Act to protect the right of workers to a secret ballot in choosing whether or not to unionize. This move is meant to preempt the egregiously misnamed Employee Free Choice Act (EFCA), which is designed to remove workers’ right to a secret ballot. Democrats are pushing EFCA as a thank you for the millions of dollars unions gave to Obama and various high-profile liberal campaigns in 2008. It seeks to publicize the union voting process so that union stewards and supporters can intimidate workers who choose to reject what they have to offer. Reports of such intimidation are already surfacing in Oregon, and many Republicans are worried about the impact of wider union influence in the American economy. As DeMint noted, “Why would we take the business model that has virtually destroyed the American auto industry and try to force it onto the entire American economy?”

Hope ‘n’ Change: Going after tax havens

Treasury Secretary and tax cheat Timothy Geithner announced this week that the administration is going to unleash some new rules to keep international companies and wealthy Americans from tucking money away in tax havens to avoid paying their “fair” share. A fair-minded press would have burst into laughter after hearing that one, but with news agencies like the Associated (with the Left) Press, it’s no surprise that they chose to ignore the choking irony of Geithner’s own tax evasion. After all, at this point, the nation’s biggest tax shelter seems to be within the Obama cabinet itself, where numerous secretaries and potential appointments have been exposed as cheats. That list grew again this week, as trade representative Ron Kirk agreed to pay close to $10,000 in back taxes after his unpaid “fair” share emerged during his vetting process. If Obama keeps nominating such responsible citizens for cabinet posts, he might be able to halve the deficit after all.

From the Left: Blago’s book deal

As governor of Illinois, Rod Blagojevich received (we hesitate to say “earned”) $155,600 per year. The since-ousted Democrat could match that with his upcoming tell-all book due out later this year. Creatively dubbed “The Governor,” Phoenix Books announced the deal earlier this week despite Illinois legislation introduced to prohibit Blago from seeing any profit from his impeachment and removal from office. Revelations from the book could also end up being used against the disgraced former governor in his upcoming federal trial. For his part, Blagojevich promises to expose “the dark side of politics that he witnessed in both the state and national level.”

A case study on when to recuse

On Tuesday, the United States Supreme Court heard arguments in a case that exposed the seamy underside of judicial politics. Hugh Caperton, owner of a small coal company, sued A.T. Massey Coal Company in a West Virginia court, claiming it illegally drove him out of business. After Caperton won a $50 million jury verdict, the case found its way to the West Virginia Supreme Court. One of the five justices who heard the appeal was Brent Benjamin, whose election was primarily financed by Don Blankenship, the CEO of the defendant. Blankenship raised approximately $3 million for Benjamin, representing approximately 60 percent of Benjamin’s total campaign fund. The West Virginia Supreme Court overturned the jury’s verdict, with Benjamin casting the deciding vote. Understandably, Caperton claims that Benjamin’s refusal to recuse himself denied Caperton his due process rights.

Although there are many things wrong with this case, the blame lies primarily with Justice Benjamin. Any decent judge would have recognized that hearing a case in which one of the parties was his own primary fundraiser created an obvious – and virtually irrefutable – presumption of bias. Even if Benjamin truly could decide the case impartially, he should have recused himself to preserve the integrity and legitimacy of the judiciary. Fairness and impartiality is the cornerstone of our court system. Benjamin’s refusal to understand this and to remove himself from this case casts serious doubt on whether he should remain on the court.

NATIONAL SECURITY

Department of Military Readiness: Obama set to kill missile defense

Wasting no time demonstrating that Democrats, too, can be vigorous defenders of freedom, President Obama reportedly sent a letter to Russian President Dmitri Medvedev in February, offering to trade away the planned missile defense system in Poland in exchange for Russian help in stopping Iran’s nuclear and ballistic missile programs. There are several enormous problems with this proposal, and each is a direct result of Obama’s lack of experience in international affairs. 

First, the Democrat Party has an unbroken 40-year streak of opposing missile defense. Obama himself, when asked about the Polish deal in 2008, threw out one of the most hackneyed arguments against it, stating, “I’ll support missile defense when the technology is proved to be workable." Uh, done. The Russians, with their own knowledge of the missile defense issue and Democrat opposition to it, no doubt expect the Democrats to kill the Polish deal no matter what happens. Why allow themselves or their client Iran to be roped into any deal to secure what the Democrats will provide for free? In offering such a swap, Obama’s first and lasting impression on the Russians will be one of weakness.

Second, Patriot readers will recall that the official position of the Russian government –by which we mean Vladimir Putin – is that he sees "no evidence that Iran was working towards nuclear weapons.” The International Atomic Energy Agency has likewise stated that it finds “no evidence that Iran is diverting material for a weapons program,” although noting that Iran has not yet explained its weapons design work. And the 2007 Iran National Intelligence Estimate accurately notes that Iran’s 2003 decision to halt work on nuclear weapons “is inherently reversible." Any Russian "cooperation” is likely to favor Iran over the United States.

Finally, Russia is not the key player in Iran’s nuclear or ballistic missile programs. North Korea is Iran’s silent partner in the development of ballistic missiles, while AQ Khan has all but made Iran self sufficient in nuclear enrichment work, from which it is but a short technical leap to weapons work. Russia has some leverage over Iran, including the rumored SA-20 surface-to-air missile deal and in the fueling and start-up of Iran’s Bushehr nuclear power plant. But Russia cannot force Iran into any such deal even were Moscow so inclined. 

Is Mexico near civil war?

Mexico is approaching a state of near civil war, and it is inevitable that the U.S. will be entangled in the crisis. For years, the power of Latin American gangs has grown with little or no challenge. Trafficking in drugs and human smuggling, they use indiscriminate violence and murder to maintain their power, creating paralyzing fear among the locals. They have carved Mexico into dozens of territories, each nominally controlled by a different gang. Territorial invasions or insults, real or invented, ensure frequent clashes.

In the last two years, gang violence in Mexico has escalated sharply, especially along the American border, often crossing the border. More than 7,000 people in that region have been killed in the last year. In his campaign for the presidency in 2006, Mexican President Felipe Calderon promised to destroy the drug cartels that are turning Mexico into Colombia North. Unfortunately, he is having little success.

Currently, the Sinaloa cartel, also known as the Federation or Golden Triangle, and the Los Zetas, or Gulf Cartel, are by far the biggest and most violent. They appear to be on the threshold of merging – the consequences of which are potentially immense. The U.S. Defense Department now believes that the two cartels have fielded their own army of 100,000 men – a number that rivals Mexico’s army.

Making matters worse, the genuine Zetas were trained as commandos in drug interdiction by the United States. They were supposed to work Mexico’s southern border but decided to go where the money is instead. Still worse, they’re loaded with cash and have amassed a huge arsenal of impressive weapons – plenty of AK-47’s, machine guns, grenades, grenade launchers and more.

As one American defense official said, Calderon “is fighting for his life [and] "for the life of Mexico right now.”

In a related story, in Phoenix this week, 47-year-old George Iknadosian went on trial in federal court for knowingly selling hundreds of firearms, mostly AK-47’s, to people who then turned the guns over to Mexican drug cartels. Officials on both sides of the border claim that 90 percent of the guns in the cartels’ hands trace back to the U.S.

A particularly egregious incident explains the anger of Terry Goddard, the Arizona Attorney General, who is prosecuting the case. Last year in the Mexican border city of Nogales, the chief of the Sonora state anti-drug unit, Juan Manuel Pavon, was murdered by cartel hit men only hours after attending a U.S. seminar on how to slow American firearms coming into Mexico. Weapons later linked to the murder traced back to Iknadosian’s store, X-Caliber Guns.

Naturally, the Left is using this as an opportunity to call for a reinstated ban on semiautomatic rifles. Admittedly, the number of such weapons in Mexico has spiked since 2004, but guns are not the cause of the violence; they are merely a tool.

Hamas and your money

As mentioned last week, the Obama regime is sending $900,000,000 of your money to Gaza and, by extension, its Hamas leadership, to help rebuild Gaza after Israel’s recent Hamas-hunting expedition. This week, Secretary of State Hillary Clinton continued to insist that the money will not go to Hamas terrorists but will be funneled into the area, primarily to the Palestinian Authority, via other governmental and international aid channels. But since money is fungible, every external dollar that Gaza receives to rebuild is an internal dollar Hamas doesn’t need to spend rebuilding Gaza but can instead spend replenishing its arsenal.

Since Israel ended its three-week offensive on 18 January, Hamas has fired some 130 rockets and mortar shells into southern Israel from Gaza. Interestingly, despite their recent unpleasantries with Fatah over the control of Gaza, Hamas has agreed to join forces in order to form a new transitional government. That government will handle Palestinian affairs until new elections can be held. This move by Hamas may indicate that they were bloodied and weakened more than initially thought by Israel.

Meanwhile, it appears that Newsweek also is joining the Hamas/Fatah union. Earlier this week, the leftist weekly fulfilled a Hamas dream and wiped Israel off the face of the earth, at least according to a map they displayed on their Web site that showed no Israel, but only “Palestinian Territory.” They have since corrected their “mistake,” without comment, of course, but really, how does a publication of Newsweek’s stature make that kind of “mistake” in the first place?

Profiles of valor: U.S. Army Maj. Ortega

Major Orlando Ortega of the United States Army was serving in Iraq as the commander of G Battery 202 Air Defense Artillery and led his unit on more than 650 missions without losing a single soldier – no small feat. On 15 September 2004, Ortega encountered an ambush that threatened the lives of his men. What started out as a routine reconnaissance mission turned violent, as two roadside bombs exploded and heavily armed insurgents targeted Ortega’s convoy. When the first bomb went off, Ortega’s vehicle, in the lead, stopped. He later recounted, “My driver was slumped over the steering wheel and the passengers in the rear were stunned. We received small arms fire from the second and third floor of a building on our right.” Fortunately, none of the soldiers were seriously injured by the bomb. First, Ortega moved the convoy forward out of the kill zone, but the insurgents then concentrated their attack on the last vehicle. Ortega decided to counterattack. The convoy maneuvered for two counterattacks, successfully defeating the enemy with no friendly casualties or major equipment damage. “Within 48 hours my soldiers were back on new missions. Incidents like this one occur every day in Iraq but go untold,” said Ortega. For his heroism and dedication to his fellow soldiers, Maj. Ortega was awarded the Bronze Star with combat “V” for valor.

BUSINESS & ECONOMY

Regulatory Commissars: Cap-and-trade is a bad idea

The Lieberman-Warner cap-and-trade approach to greenhouse gases makes us think derivatives. Analogous in more ways than one to the vaporous quality of financial derivatives, this new “market” depends on the underlying “value” of carbon and the ability to trade it as an “offset." One difference is that we already know this sort of program is an economic nightmare in Europe.

If undeterred by Europe’s failure, our congressional best and brightest should note the impact as determined by a recent report by the Marshall Institute: The new regulations would be the equivalent of a permanent tax increase for the average American household, estimated to be $1,100 in 2008, rising to $1,437 by 2015, and $2,979 by 2050. Hundreds of thousands of jobs would be lost, while electricity and natural gas prices would increase by anywhere from five to 50 percent over the next five years. Gasoline could increase as much as 145 percent. So much for President Obama’s promise of "a tax cut for 95 percent of working Americans.”

In summary, Congress and the Obama administration have proposed a program that addresses an unproven climate change problem by implementing a program proven to bring higher energy costs, job losses, and is every bit the financial scam that many financial derivatives have proved to be. The “underlying asset” is nothing but a government-imposed regulatory scheme designed to enrich the traders, depress Western economies and promote the myth of man-made climate change.

Freddie chief resigns, federal control to continue

Government-run mortgage giant Freddie Mac, whose politically caused losses helped trigger today’s financial depression, was ordered this week to oversee a vast new mortgage modification program and work with the same questionable borrowers whose defaults crashed the economy. Furthermore, federal control over Freddie and Fannie Mae will continue until the entities can repay the $200 billion lent to them. This is estimated to take approximately 100 years, or never, whichever comes later.

Chafing under such intrusive restrictions, Freddie Mac CEO David Moffett is resigning after only six months on the job. Low pay, second-guessing, and Obama administration officials intent on making politically motivated loans were apparently contributing factors. 

As for the banking industry as a whole, the Federal Deposit Insurance Corp. (FDIC) is quickly running out of money because of all the banks it has helped. Sen. Chris Dodd (D-CT), the Senate Banking Committee Chairman who is largely responsible for the mess, is now offering up to $500 billion in temporary loans from the Treasury Department for the FDIC.

AIG bailout, take four

The central government’s never-ending bailout debacle of AIG reminds us of Ronald Reagan’s apt comparison of big government to a baby’s alimentary canal – both having an insatiable appetite for taxpayer funds at one end and no sense of responsibility at the other. After three “bailouts” for AIG since September totaling nearly $180 billion in squandered taxpayer funding, all the taxpayers have to show for their purchase is a company locked in a death spiral. So, naturally, the Federal Reserve is throwing more money at the problem. Now that the government owns 78 percent of AIG, there is no end in sight for the ever-declining insurer. On Monday, AIG reported a $61.7 billion fourth-quarter loss, all of which was incurred under the new federalized stewardship.

Left unexplained in this unprecedented federal takeover is a meaningful financial justification for the bailout scheme. As a heavily state-regulated insurer, the company maintained adequate financial reserves for claims, while state guarantee funds exist to resolve any losses arising from inadequate reserves. Instead, the public is given vague explanations suggesting it was necessary, that neither the government nor AIG need explain where the public’s money went, and that the company’s board of directors has not approved any of the government’s interventions.

CULTURE & POLICY

Judicial Benchmarks: Religious display ruling

A decision by the U.S. Supreme Court last week may grant more discretion to government bodies that choose to express messages, including religious ones, to the public. The Court unanimously upheld a Utah city’s decision to decline a request of the Summum religious sect (a New Age cult) to host a monument in a public park to the sect’s “Seven Aphorisms,” even though the park already held a Ten Commandments monument.

Summum argued the monuments amounted to private speech, and that the park had become a public forum. This would bar the government from favoring some viewpoints over others. The Court instead found the city’s maintaining the monuments to be government speech, where favoritism is permissible (and inevitable). As Justice Alito explained, a bar on favoritism would have meant that America’s acceptance of a Statue of Liberty from France would have compelled a comparable acceptance of a “Statute of Autocracy” had Imperial Russia offered one.

On the other hand, whereas government may discriminate based on viewpoint, it may not promote religion (either a single denomination or religion generally). Because the case was about the exclusion of the Seven Aphorisms and not the inclusion of the Ten Commandments, the Court did not consider whether that monument was a governmental endorsement of religion or simply a legitimate recognition of the Ten Commandments’ significance in the history of law.

Faith and Family: Birth and death

The L.A.-based Fertility Institutes is drawing both praise and criticism for offering parents a “trait selection” service for their future children. In short, an embryonic cell is tested prior to the embryo’s implantation into the mother’s womb. If the cell passes muster – i.e., has the genes for the “right” eye or hair color – then the embryo is allowed to live. If not, it is discarded. Institutes Founder Dr. Jeff Steinberg claims this is not a “dangerous” but an “unchartered” road, but UK-based fertility expert Dr. Gillian Lockwood cautions against “turning babies into commodities that you buy off the shelf.”

As for the other end of Man’s journey, Washington State’s “Death with Dignity” law took effect Wednesday. Under the law, terminally ill adults with less than six months to live can request a prescription of lethal medication. Doctors and pharmacists opposing the law are not required to provide the medication, but according to retired cardiologist and “death with dignity” advocate Dr. Tom Preston, the law “will be a cultural shift.”

In truth, build-a-baby clinics and aid-in-dying laws represent not a “shift” but an earthquake, and the resulting landscape portrays a society purporting to embrace science and compassion but often treating neither birth nor death with dignity.

Climate change this week: Warming hearing snowed out

Never before has Henry David Thoreau been so sorely abused. Al Gore, speaking before Bill Clinton’s Global Initiative last November, called for “civil disobedience” to combat so-called global warming. He was echoed by Jim Hansen, head of NASA’s Goddard Institute for Space Studies. With all the fire and brimstone of a Puritan preacher, Hansen called those disagreeing with him “guilty of high crimes against humanity and nature.” As a result of this speech, the Capitol Climate Action galvanized their followers for a protest at the Capital Power Plant in Washington, DC.

Hansen’s outrage at the continued use of coal is being challenged by Princeton physics professor Dr. William Happer, who contends that atmospheric CO2 levels are actually at a historic low – lower than levels at which humans thrived for a long time. It should be noted that Gore fired Happer in 1993 from the Department of Energy after he voiced his alternative views.

The 2 March protest was greeted with a delicious bit of irony: While 500 “true believers” risked frostbite on the Capital lawn, Nancy Pelosi’s appearance was scrubbed on account of the weather – her flight was cancelled due to the worst snowstorm of the season. Another no-show was House Select Energy Independence and Global Warming Chairman Edward Markey. Markey’s spokesperson, in a classic case of “he doth protest too much,” reiterated several times that Markey’s absence was not due to the inclement weather. Not that Pelosi was doing anything wrong, the spokesman quickly added.

And last…

A 79-year-old North Florida woman received a surprise when a letter from the United States Marines came in the mail. Opal Blackwell Walker is only two weeks away from retirement as a paper carrier, but the Marines want to know, “Do you think you have what it takes to be a Marine? Are you prepared for one of the most demanding challenges you will ever face?” She said at first she thought it was a joke, but decided that she would stop by the local recruiting office and say, “Here I am. Where do you want me?” Unfortunately, the patriotic Walker falls just outside the 17-to-29 age requirement for enlisted Marines. Still, as far as we’re concerned, she can consider herself an honorary member of the few and the proud. Semper Fi, Granny!

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