Archive for Economics

A New Fave

My blogging favorites are well known: Mark Steyn, Caroline Glick, James Taranto, among a select few others. But you know who’s popped up on my radar screen, based on talent alone?

Kevin D. Williamson:

The Left is at war with economic reality. The intellectual poverty of the Left — which is also a moral poverty — is evident in the fact that its leaders are much more intensely interested in incomes at the top than those at the bottom. Examples are not difficult to come by: Senator Elizabeth Warren is visibly agitated by Jamie Dimon’s recent raise, the AFL-CIO maintains a website dedicated to executive compensation, Barack Obama avows that “at a certain point, you’ve made enough money,” et cetera ad nauseam. The entire rhetoric of inequality is simply an excuse to rage about incomes at the top, a generation’s worth of progressive shenanigans having failed to do much about those at the bottom.

It is the case that incomes at the top have gone up while those in the middle and at the bottom have stagnated or declined in real terms. It is not the case that incomes at the top have gone up because those in the middle and at the bottom have stagnated or declined, nor is it the case that incomes in the middle and at the bottom have stagnated or declined because incomes at the top have gone up. There is a relationship between the two phenomena, but it is not the relationship that progressives imagine it to be.

The Starbucks-vandalism faction of the Left likes to rail against globalization, but to do so is like railing against the fact that it is cold in the winter. Winter is an important part of the natural cycle, but it can be unpleasant — even deadly. It is something that must be prepared for, and instead of Ned Stark to warn us that winter is coming, we had Lyndon Johnson, a vicious and corrupt man who presided over the building of a vicious and corrupt welfare state. There are things we should have done to prepare for the future that is now our present, reforming the education system and our labor practices, among other things. (GM went bankrupt paying its workers half of what their German counterparts make: the worst of both worlds.) But we did not do those things. We can rail against the tyranny of winter, or we can start gathering firewood.

LBJ: “vicious and corrupt”. So he was, and so is his legacy. My elision leaves out some of his corroboration, but it’s there. Williamson nay not have Mark Steyn’s mercurial wit, but he’s a beautiful writer in his own right. And as prophetic as Jeremiah.

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Mayor for Life

For the sake of accuracy, I should have written “Mayor Serving Life”. But I stand by the title: Detroit is still suffering from Con-Man Kilpatrick, and will for a long time to come:

Detroit leaders are suing to invalidate several Wall Street deals that allowed the city to borrow more than $1.4 billion in 2005 for its underfunded pension plans, arguing that the agreements were illegal and shouldn’t be repaid.

In a lawsuit filed in U.S. Bankruptcy Court in Detroit, city lawyers said the deals reached under a former mayor, Kwame Kilpatrick, led the city to borrow more than the state’s debt limit, resulting “in the creation of city debt that was not authorized” by state law. Michigan cities, with few exceptions, can’t borrow more than 10% of the value of the “real and personal property” within their borders.

The pension borrowing deals go back to 2005, when the city had fallen nearly $1.7 billion behind in payments to the retirement funds that distribute benefits to more than 20,000 of the city’s retirees. Facing lawsuits from the retirement funds, Detroit officials turned to Wall Street bankers for a fix.

Detroit once had so much to recommend it: three great sports teams (the Lions being the lone—and perennially losing—exception); a second-tier symphony orchestra (that’s a huge compliment, actually: after the Big Five, Detroit’s was among the next best); a similarly esteemed art museum. Now, it’s a remaindered city. People poke among its glorious ruins looking for a deal or a steal.

The suit said that the deals were done “at the prompting of investment banks that would profit handsomely from the transaction,” but it didn’t name the city’s financial advisers. Mr. Kilpatrick, who is in prison on federal corruption charges, also wasn’t a target of Friday’s suit.

Capitalism doesn’t have a conscience—that’s its most redeeming feature. A locomotive doesn’t have a conscience either, but would you rather have Mother Teresa pull your train or a diesel? So, of course Wall Street would leap at the chance to make a buck—and “help” the hard-wroking, entitled retirees of the Motor City.

Snort!

They just needed the hard-working, earnest public servants of the city to act as responsible stewards of the ship of state.

Guffaw!

This sounds like the same Catch-22 that the banks were forced into. Accused of “red-lining” (sorry for any unpleasant reminder, Mr. President) certain underprivileged neighborhoods, banks were forced to give mortgages to financially dodgy applicants. When they borrowers couldn’t pay, even after repeated restructuring, the banks took a hit for “predatory lending”.

Government sounds like a great idea until you’ve been governed by it.

PS: What did I just write about a remaindered city?

It was late Friday afternoon before Labor Day weekend when Fernando Palazuelo reached the head of the line at the tax collection window of the treasurer’s office in Wayne County, Mich.

He had traveled 3,700 miles from Lima, Peru, to make a simple request. “I am interested in buying the Packard plant,” he said. “And I want to speak to the man in charge.”

A few minutes later, he was ushered in to see Raymond Wojtowicz, the 84-year-old county treasurer responsible for tens of thousands of foreclosed properties in the bankrupt city of Detroit.

And with that, Mr. Palazuelo, a developer of broken-down buildings from Europe to South America, was on his way to buying the biggest, most iconic eyesore in this city — the abandoned Packard Motor Car plant.

I’ve been to Peru, and love it. Mean it. Seriously. But if you’re such a wreck that even Peruvians are buying your ruins, you are past saving.

PPS: I’m serious about loving Peru. It’s more than Machu Picchu: there are Incan ruins all over the country. It’s got Andean peaks and Amazon rain forests; sandy beaches and rugged hiking; first world dining and third world subsistence. And now it owns the old Packard plant!

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OMG, America is So Sexist, Racist, Etc., Even the American Dream is Sexist, Racist, Etc!

Turns out the secret to wealth and success is love, marriage, and hard work.

The bastards! (Okay, you can skip love.)

Rich America is working America: Wealthy households contain on average more than four times as many full-time workers as do poor households, and, surprisingly, inherited wealth constitutes a smaller share of their assets than it does for middle-class and poor households. They live modestly relative to their means and for the most part do not work on Wall Street or as corporate executives. The caricature of the rich American as a child of privilege who inherited a fortune and spends his days shuttling between mansions in a private jet is largely a product of the imagination of such would-be class warriors as Elizabeth Warren and Robert Reich, neither of whom lives in Section 8 housing, or even downwind of it.

For the hated “1 percent,” inherited wealth accounts for about 15 percent of holdings. Contrary to the story the Left likes to tell about economic inequality in the United States, those numbers have gone down over recent decades — by almost half for the wealthiest Americans. Meanwhile, inherited money makes up 43 percent of the wealth of the lowest income group and 31 percent for the second-lowest. In case our would-be class warriors are having trouble running the numbers here, that means that inherited money on net reduces wealth inequality in the United States (measured as a ratio) rather than exacerbating it; eliminating inherited wealth would have approximately twice as much of a negative effect on modest households as on wealthy ones.

So, go ahead! Hammer them, Lieawatha!

There is a reason that money earned from work accounts for a relatively large share of the holdings of rich Americans: They work more — a lot more.

There is, to be sure, such a thing as the working poor, but the most salient characteristic of poor households is the lack of full-time workers in them. For the bottom income group, there is an average of 0.42 earners per household, with 68.2 percent of householders not working at all, as opposed to 1.97 earners per household and only 13.3 percent not working for the highest income group. The answer to poverty turns out to be “get a job,” after all.

Not surprisingly, 78.4 percent of those highest-income families were married couples, as opposed to 17 percent for the lowest-income group. What this all means in brief is that the highest-income families are composed almost exclusively of two-earner households, the overwhelming majority of them married couples. Those who are inclined to see public policy mainly through green eyeshades may sniff at the social conservatives and their quaint worries about marriage, but there is a very strong connection between how we conduct our family lives and our economic outcomes.

This is not an invitation to moral crowing about the virtues of the rich — okay, maybe it is. The country would in fact be far better off if more people lived the way the top 20 percent do: married, working their butts off, saving and investing their money, and living within their means. (In his research for The Millionaire Next Door, Thomas J. Stanley found that the most popular make of automobile among the wealthy was not Ferrari or Mercedes but Ford, and that the most common Ford model owned by a millionaire was the F-150 pickup truck.)

You know what’s funnier than the secret of wealth turning out to be Leave it to Beaver (with Mrs. Cleaver running a successful catering business, employing Eddie Haskell as a delivery driver)? It’s no secret!

This guy crunched the numbers, but who doesn’t know this intuitively? Two incomes, stable homes, kids learning the value of education—it sounds like the Obamas. And they’re stinking rich! (Relax, it’s just an expression.)

If class warriors like Fauxcahantas really wanted to help the middle class, she’d… she’d do nothing. Most government programs for the poor have led to more poverty. The successful household model—two working parents—has only gotten further out of reach for the poorer among us. God help us if Liberals get their talons into the rest of us. We’ll be skinning each other’s dogs and cats for food. Or living in Detroit.

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You Say Beachcomb, I Say Titcomb, Let’s Call the Whole Thing Off

President Obama wants those 1.3 million Americans who lost their (re-re-re-) extended unemployment benefits yesterday that he is thinking of them. In fact, he boycotted the golf course in protest.

Unless it was just blisters:

How President Barack Obama spent day eight of his holiday vacation in Hawaii on Saturday:

— HEALTH CARE UPDATE: White House officials said Saturday that the president received an update from his health care team late Friday night on the implementation of his signature federal health care overhaul.

The president said officials should prioritize consumer flexibility and minimizing disruptions for people switching plans, the White House said.

— GYM: Obama went for his usual morning workout at Marine Corps Base Hawaii in Kaneohe. As he returned to his vacation home, demonstrators waved signs representing various causes outside a blocked-off street leading to his neighborhood.

— NORTH SHORE BBQ: The first family joined longtime Obama friend Bobby Titcomb for an afternoon barbecue at Titcomb’s home in Waialua, an historic sugarcane plantation town on Oahu’s north shore.

Did Bobby invite any of his “special friends” to provide entertainment? Sorry, just wondering.

Besides, that’s all forgotten now:

The friend of President Obama who got busted in a Prostitution sting has gotten the crime removed from his record.

Bobby Titcomb got arrested back in April during an undercover police sting in Kakaako.

The 49-year-old pleaded no contest to a misdemeanor charge.

But the Prosecutors office says because he stayed out of trouble for six months, the conviction has been expunged.

Just like Auntie Zeituni’s and Uncle Omar’s repeated violations (not to mention Bill Ayers’)! What a coincidence! The president knows a lot of lucky people.

PS: Sorry, 1.3 million Americans, didn’t mean to forget you. You can go back to work now:

New York Times:

Economists expect that the end of the emergency jobless benefits will, surprisingly, lead to a sharp drop in the unemployment rate, by as much as 0.5 percentage points.

Surprising to whom? By my back-of-the-envelope calculations, more than half of the 1.3 million victims of this ObamEconomy would be working again if we just stopped paying them not to work.

Whose the Scrooge now?

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Jobbed

After 4 1/2 years of “recovery”, we’ve finally had a decent jobs report. You’d think the Democrats would hoot and holler in exaltation.

You’d think wrong:

House-Senate negotiators are close to a modest budget accord to avoid another government shutdown, but suddenly the White House is introducing a last-minute demand. Five years into an economic recovery that President Obama often hails as miraculous, he wants to extend unemployment benefits one more time.

That would add some $25 billion to the deficit with no compensating economic benefit. The Administration claims that every $1 of jobless benefits creates $1.80 in economic growth, based on the notorious “multiplier” in Keynesian economic models. This is the theory that you can increase employment by paying more people not to work, and that you can take money out of the private economy by taxes or borrowing without cost. If that theory worked, the government should pay everyone not to work.

Alan Krueger, President Obama’s former chief economist, coauthored a 2008 study reviewing the amount of time that unemployed individuals in different states and countries spent looking for a new job and found, among other things, that “job search is inversely related to the generosity of unemployment benefits.” Other studies have found that laid-off workers ineligible for unemployment benefits spend more time looking for a new job than those who get checks.

Right-wing fascist.

Just like this guy:

“Public policy designed to help workers who lose their jobs can lead to structural unemployment as an unintended side effect. . . . In other countries, particularly in Europe, benefits are more generous and last longer. The drawback to this generosity is that it reduces a worker’s incentive to quickly find a new job. Generous unemployment benefits in some European countries are widely believed to be one of the main causes of ‘Eurosclerosis,’ the persistent high unemployment that affects a number of European countries.”–“Macroeconomics” by Paul Krugman and Robin Wells, second edition, 2009

Like raising the minimum wage, unemployment benefits depress employment. But good political luck with that point of view. Democrats will trade jobs for votes every day—and twice on election day.

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Good Jobs at Good Wages

0-for-2.

We’ve let the “rosy” economic numbers marinate for a few days. Kind of like the old joke the punchline of which is “coffee break’s over, everyone back on your heads!”

Coffee break’s over:

But here’s your trouble:

1. There are still 1.1 million fewer employed Americans today than right before the recession started, despite a potential labor force that’s 14 million larger. And there are 3.6 million fewer full-time workers than back in 2007.

2. The employment rate, the share of Americans with a job, is 58.6% — exactly where it was in November 2009.

3. If the labor force participation rate were where it was a year ago, the jobless rate would be 7.9%, not 7% (and 11.3% if the LFPR were at prerecession levels, though closer to 9% if demographics-adjusted).

4. More than 4 million Americans remain out of work for 27 weeks or longer.

5. Overall, according to the Hamilton Project Jobs Gap calculator, it will take another five years to return to 2007 employment levels even at the improved job creation pace of the past four months.

The Left isn’t very happy, either:

That’s because so many of the new jobs that get created in the U.S. today are lousy and don’t offer a real path into the middle class.

So, for example, retail and restaurant jobs again grew rapidly last month, with some 40,000 new positions created in these sectors. But as we all know — and as Demos has documented — many of these jobs pay barely over poverty wages and don’t come with benefits. Transportation and warehousing were other bright spots in job growth, with 30,000 new jobs in those areas last month. So it’s a shame that warehouse work is so poorly paid these days, with Amazon and other big shippers creating a new kind of sweatshop.

If you want to get a clear look at the jobs America’s economy produces, one of the best places to go is the Social Security Administration, which tracks earnings by all workers. Their most recent data shows that 53 percent of Americans workers earn less than $30,000 a year. Forty percent of American workers earn less than $20,000 a year.

Let me stop and repeat that statistic: 40 percent of all U.S. workers earn less than $20k a year.

One solution to this situation is to create an economy and education system that generates more good jobs for a work force with better skills. Another solution is to raise wages for low-skilled jobs, which is what the recent wave of labor strikes has been all about.

The U.S. has to pursue both solutions, and others, if we want to create a decent society.

Five years into ObamAmerica, and they’re still bitching about what a terrible people we are. They may be right, but for the wrong reasons. What they seem to hate is a result of Obama, not in spite of Obama. (Fox Butterfield, is that you?)

Rather than blame Amazon for providing the only jobs going, why not be grateful? Exactly how much should “warehouse work” pay? Amazon can run a website, sell a product (thousands of them), deliver them as promised—soon, by drone, within hours. Can government do anything like that? Amazon’s Jeff Bezos even saved the beloved organ of the Washington establishment, the Washington Post. Explain to me how he’s the villain?

“One solution to this situation is to create an economy and education system that generates more good jobs for a work force with better skills.”

D’oh! Why didn’t we think of that?

If by those ingenious suggestions they mean letting the private sector find its way toward profit, and letting families choose the best schools for their kids, I’m on board. But the left doesn’t trust the private, the individual. It’s all about the collective to them. Which is why we are where we are.

Fox Butterfield, is that you?

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Distract-a-Palooza!

Step right up, ladies and gentleman, and watch the Amazing Hussein make one-sixth of the American economy disappear! Now you see ObamaCare…

Now you don’t!

The growing gap between rich and poor Americans is threatening the ideals the country was founded upon, President Barack Obama said in remarks Wednesday that appeared to signal a leftward turn in his economic agenda.

Making sure that the U.S. economy works for every working American is “the defining challenge of our time,” Obama said in a speech at the Center for American Progress, a liberal think tank. He later said the “dangerous and growing” income and opportunity gap is jeopardizing the notion that if people work hard, they can get ahead.

Thank the lord we have a new president to reverse this “dangerous and growing” calamity! Oh wait. Isn’t it amazing how The Amazing Hussein can summon the wraith of George Bush to obscure the myriad failures of his regime? Amazing.

To combat the chasm between haves and have-nots, Obama called for a hike in the federal minimum wage, saying an increase is a good step for families and the economy as a whole.

Democrats on Capitol Hill have pushed for an increase in the federal minimum wage, which currently stands at $7.25 an hour. A proposal would boost it to about $10, and the White House has said Obama supports such a measure.

That extra $20 a day will make millionaires of every American. Porterhouse for all! Moet for the house!

I used to oppose knee-jerk hikes in the minimum wage (after supporting them). But now I’m back on board. Sure, there’s a direct link between minimum wage hikes and unemployment—stretched business owners can’t just “make it rain”, tossing cash in the air like confetti—but I’m tired of leftist weenies like the namesake of Obamacare getting all the joy out of grandstanding on the issue.

Take your $10 an hour and shove it up your backside! Give me a Grant or give me death!

I recall a great moment on Rush Limbaugh this summer: [I necessarily edited this to add coherence to the caller’s point.]

CALLER: This is Sean in San Diego, and I believe those workers at McDonald’s and Burger King deserve some more money. The shareholders are getting rich. I watch every day on MarketWatch, and the CEO is getting rich. They’re making their profits. They can afford to pair their workers a bit more money. They’re not asking for much. They haven’t had a raise in 25 years.

RUSH: Really? In 1988, people at McDonald’s were making $7.25 an hour?

CALLER: I’m not exactly sure of that, but —

RUSH: Well, that would be important.

CALLER: They’re not being paid fairly, Rush.

RUSH: Why can’t they [get a job that does pay]?

CALLER: Probably no other jobs out there in this bad economy.

RUSH: Why? Why aren’t there any jobs out there?

CALLER: The Democrats have destroyed this economy. We all know that.

RUSH: Okay. Well, the minimum wage, by the way, back 25 years ago was $3.35 an hour, just to get the number out there. It was not what they’re making today. I’ll get the inflation calculator out and take a look at it. They’re asking for double their current wages. Sean, why doesn’t the McDonald’s franchise just pay it? You know, why not just give them more money?

CALLER: Oh, that’s simple. Greed.

RUSH: Greed? Or is it competition?

CALLER: Why should they if they don’t have to and nobody’s making them? Government sets the minimum wage, and they don’t want to do it.

RUSH: Well, okay. Let’s take a look McDonald’s, and let’s say the McDonald’s gives their employees a raise. Let’s just say $10 dollars an hour. Would that be enough?

CALLER: No. I don’t think so.

RUSH: Okay.

RUSH: How about this? How about McDonald’s raises everybody to $20 an hour? Would that be enough? Would that be okay?

CALLER: I think that would probably help a lot of people.

RUSH: What about $25 an hour?

CALLER: Managers should probably get at least that. They probably already do.

RUSH: Okay, then what about $30 an hour?

CALLER: If that’s the fair market rate.

RUSH: Well, no, that’s what $7.25 is.

CALLER: I don’t believe that.

RUSH: Yeah, that’s why it’s $7.25. It’s the fair market rate. It’s $7.25 not because it’s temporary. That’s the fair market rate. Let’s pay ‘em $50 an hour, how about that?

CALLER: $15 an hour.

RUSH: No, $50.

CALLER: $50?

RUSH: Five-oh, $50 an hour. How about that?

CALLER: Yeah. That should be the new fair market rate.

RUSH: Right on. Right? Well, let’s keep going, how about $75 an hour, let’s pay ‘em $75 an hour.

CALLER: Where you going with this?

Finally! It took how long for Sean from San Diego to get Rush’s point?

Except he doesn’t!

RUSH: Well, I want to know whether you agree with $75. I’m not going anywhere with it. If $50 is good, $60 would be better, right?

CALLER: Well, yeah.

RUSH: What about $75 an hour?

CALLER: Where you going with this, though? I don’t understand.

Coulda fooled me. But Rush is kinder than I am:

RUSH: Sean? Sean, one thing. I’m not trying to trick you. I’m not playing a trick on you here. Please don’t misunderstand. I’m not taking you anywhere. I don’t want you misunderstand.

The point, Sean, is that you just said that $7.25 isn’t the market price, and it is. That $7.25 an hour is what it requires for McDonald’s to be fully staffed. There are people who will work for that, and therefore that sets the wage scale. Now, $10 would be better.

Yeah, you can keep raising it, but at some point, everybody who believes in a minimum wage will say, “No, wait a minute. That’s too much,” and at that point, you have demonstrated that that there’s no market relationship. You’re just talking emotion. You’re just talking “fairness.” You’re just talking being nice, and that’s not how the market works. People aren’t paid a wage because they’re being nice to, or because it’s fair. In the market, the market rules. You can control it all you want, you could add arbitrary numbers on it all you want, and all you’re doing is delaying the inevitable.

The market will always win and will always rule, because it is the market.

The Amazing Hussein now stands naked before us, and considerably less well-endowed than Piers Morgan thinks he is.

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What Do You Call Obamanomics?

Dang! I just gave it away!

I call it Obamanomics:

By conventional wisdom, the Great Recession is long over. “Recession” connotes shrinking output. “Expansion” signifies the opposite. That’s how the National Bureau of Economic Research, a group of academic economists, defines business cycles. Following this logic, the bureau determined the economy stopped contracting in mid-2009. Yet, most Americans — 53 percent, says a recent National Journal/Allstate survey — think we’re still in recession, by which they doubtlessly mean “bad times.”

Who is to say they’re wrong? After all, the unemployment rate has exceeded 7?percent for almost five years, despite the withdrawal of millions of discouraged workers from the labor force. Moreover, public attitudes have become deeply pessimistic in ways apparently unprecedented since World War II. In past recessions, more than half of Americans believed their incomes would grow in the next year. Not this time. The share expecting gains collapsed to less than 45 percent after 2008 and is still below half, finds a study by Federal Reserve economist Claudia Sahm. The despondency, she writes, may signal a permanent shift in consumer psychology that undermines recovery.

Something’s changed, but our economic vocabulary hasn’t kept up.

Loyal Bloodthirstani citizens know when the “recession” “ended”: June 2009. America has swelled by over 10 million new citizens—greater than the combined populations New York City and Philadelphia—who have never known recession.

What they have known, to their dissatisfaction, is Obamanomics. Or, if you prefer:

In a recent lecture, former Treasury secretary Lawrence Summers evoked secular stagnation — a “chronic and systemic” economic sluggishness, he said. Krugman, Martin Wolf, the Financial Times’ chief economic commentator, and others also embrace the theme. There is an “investment dearth,” Wolf recently wrote. Low interest rates suggest that there are “more savings searching for productive investments than there [are] productive investments.”

Why? Unlike Hansen, today’s stagnationists haven’t identified causes. The problem might not be a dearth of investments so much as a surplus of risk aversion. For that, candidates abound: the traumatic impact of the Great Recession on confidence; a backlash against globalization, reduced cross-border investments by multinational firms; uncertain government policies; aging societies burdened by diminishing innovation and costly welfare states.

Whatever the cause, we are in unfamiliar territory.

Come on, guys, use your eggheads! What’s the consistent, singular factor over this entire period?

Talk about driving the nation into a ditch! Government nationalization of whole industries (mortgages, student loans, health care); tax uncertainty (renew or repeal Bush tax rates); random and pointless market intervention (Cash for Clunkers); hostility toward business leaders; demonizing the rich—if you’re not risk averse, you’re not paying attention.

It doesn’t matter what you call it, Obama owns it. That’s why I choose to call it Obamanomics. That’s what it is.

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Two Great Men

A great man:

The pope “from the ends of the Earth,” as he described himself from the central loggia of St. Peter’s on the evening of his election on March 13, is a reformer who, as he made clear in “Evangelii Gaudium,” will measure authentic Catholic reform by the criterion of mission-effectiveness. Thus the Franciscan reform of the Roman Curia will not be undertaken for whatever modest satisfactions may be derived from moving slots around on an organizational flowchart, but to ensure that the Catholic Church’s central administration serves the evangelical mission of all the members of the church.

He is a man of broad culture, well-read theologically but more given to literary references and illustrations than to scholarly theological citations in his preaching and catechesis. Thus one of his recent daily Mass sermons praised Robert Hugh Benson’s early 20th-century apocalyptic novel, “Lord of the World,” for raising important cautions against dictatorial utopianism, or what the pope called “adolescent progressivism.”

The pope is passionately concerned about the poor, and he knows that poverty in the 21st century takes many forms. It can be found in the grinding material poverty of his native Buenos Aires, caused by decades of corruption, indifference, and the church’s failures to catechize Argentina’s economic and political leaders. But poverty can also be found in the soul-withering spiritual desert of those who measure their humanity by what they have rather than who they are, and who judge others by the same materialist yardstick. Then there is the ethical impoverishment of moral relativism, which dumbs down human aspiration, impedes common work for the common good in society, and inevitably leads to social fragmentation and personal unhappiness.

As he wrote in “Evangelii Gaudium,” Pope Francis is not a man of “political ideology.” He knows that “business is a vocation and a noble vocation,” if ordered to the common good and the empowerment of the poor. When he criticizes the social, economic or political status quo, he does so as a pastor who is “interested only in helping all those who are in thrall to an individualistic, indifferent and self-centered mentality to be freed from those unworthy chains and to attain a way of living and thinking that is more humane, noble, and fruitful.”

And, if you will, a greater man:

“Pope Francis attacked unfettered capitalism as ‘a new tyranny’ and beseeched global leaders to fight poverty and growing inequality, in a document on Tuesday setting out a platform for his papacy and calling for a renewal of the Catholic Church. … In it, Francis went further than previous comments criticizing the global economic system, attacking the ‘idolatry of money.'”

Folks, in recent weeks I have endeavored to try to make you understand how it is that people like modern-age Democrats look at small business and business at large. They do not, in the terms of small business, understand how fragile it is. Their view of business is that people who own them or run them cheat their customers, abuse their employees, hoard all the money, and have tons of it. They take it and keep it for themselves. They deny their employees a livable wage. They deny them health care. They deny them benefits. They produce products that kill and maim and sicken, or they produce products that destroy the planet, destroy the environment, or what have you.

I mean, it’s a litany. This is their view and it is why they claim that they must take it over and control it, because it’s inherently unfair that a select few capitalists rip everybody off. Rip off their employees, rip off their customers, and that’s how you have unequal incomes, and this vast gap between wealth and poverty. It’s all because of capitalism. They claim that as socialists or reformers or progressives, that they are fair and compassionate, and they will make that gap between the wealthy and the poor narrower, and they will make life more equitable, and they will engage in equality of outcomes and so forth, and wherever they’ve tried, they’ve failed.

Wherever socialists have gained power, they have done nothing but spread poverty. They cannot and do not produce wealth. They do not understand it. All they can do is destroy it. They are not compassionate; they coerce. And to hear the pope regurgitating this stuff, I was profoundly disappointed. The idolatry of money, urging “politicians to ‘attack the structural causes of inequality’ and strive to provide work, health care and education to all citizens.”

What has been happening in this country the past five years? Exactly what this man claims to want. We have a president who has attacked the structural causes of inequality, and what’s he done? He’s raised taxes on the producers and the achievers for the express purpose of redistributing it. All he’s done is create massive debt. He has destroyed jobs. There are 91.5 million Americans not working in America today, 91.5 million not working. All the while the president, 19 or 20 times, says that he’s doing nothing but focusing on creating jobs, but he can’t. No government can create jobs, not in the private sector. All they can do is hamper job creation.

The pope “also called on rich people to share their wealth.” We were just talking about the charitable donations and contributions that existed in this country, and they are profound. The United States is near the top of the list in the world of charitable countries, but even with all the charity, and it is tremendous, it cannot compete with capitalism in elevating people out of poverty. There is nothing the world has ever devised that has elevated more people out of poverty than capitalism.

Amen.

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Milton Friedman Warned Us

Over 30 years ago, and in less than 2 1/2 minutes:

And with a smile and a laugh, no less. Friedman would have swatted Obama like an annoying fly. Who’s around any more to articulate his philosophy, his truth?

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Poor Detroit

[See Aggie’s companion post below.]

Hard as it was for me to write that title, I actually mean it:

It was the politicians, and not longtime city workers like Olivia Gillon, who brought Detroit to the brink of insolvency, but now Gillon can only watch as lawyers negotiating the Motor City’s bankruptcy bid place a new value on her hard-earned pension: 16 cents on the dollar.

The beleaguered city, facing debt of as much as $20 billion and led by a state-appointed manager, tried nearly a year ago to renegotiate with creditors. When those talks broke down, the city filed for bankruptcy last July, but the filing was ruled unconstitutional by a judge. A series of state and federal rulings followed, culminating in a trial that began last week in which the city must show it is eligible to enter bankruptcy. That’s when the frightening magnitude of the “haircut” being sought for some 21,000 retirees emerged.

“It’s wrong on every possible level,” Gillon, 68, told FoxNews.com. “I earned my pension. I retired expecting it and I feel that I should have it.”

Pause here for a little reality. Sure, she earned her pension; and sure, the politicians drove Detroit into a ditch. But who elected (and re-re-reelected) the politicians? And who never saw this day of reckoning coming, and offered to give back to the city what it couldn’t afford to give away?

Longtime city workers like Olivia Gillon, among others.

The affected workers have been promised some $3.5 billion in pension payments and another $6 billion in health care benefits, money most agree the city can’t pay.

The Michigan-based Mackinac Center for Public Policy, which sounded a warning about Detroit’s fiscal problems more than a decade ago, said the old-style defined benefits pensions that have long been a centerpiece of civil service leave pensioners at the mercy of politicians.

“It’s just another example of the flaws of a defined pension system,” said Ted O’Neil, a Mackinac analyst. “The problem with putting trust in government to invest and save your money is that they don’t always make the best choices.[“]

Amen, brother. Couldn’t have said it better myself. Though Margaret Thatcher did: The facts of life are conservative.

Still, this is hard to read:

[A] retiree counting on a modest annual pension of, say $30,000, the proposed cut would leave him or her with $4,800.

From $2,500 a month to $400. Ouch. Don’t say you weren’t warned:

The Mackinac 2000 study looks prophetic now: “If Detroit’s future expenditures were relatively stable, this financial snapshot still would be cause for concern. But the city is looking at two new outlays of monstrous proportions: funding the pension obligations of current and future city employees, which could cost up to $3 billion, and fulfilling requirements under several federal environmental acts, which will cost billions more,” read the report.

No thank you, Detroit. I’ll pass on the fries. It’s called putting off short-term pleasure fur long-term health. Pity you didn’t try it yourself.

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Our Clueless Media

Just because food stamp use and disability claims are at record highs doesn’t mean the economy isn’t roaring like a Ferrari, fellas.

Duh!

The crush of new recipients is putting unsustainable financial pressure on the program. Federal officials project that the program will exhaust its trust fund by 2016 — 20 years before the trust fund that supports Social Security’s old-age benefits is projected to run dry.

The growth of the disability rolls has accelerated since the recession hit in 2007. As the labor market tightened, workers with disabilities that employers previously accommodated on the job — painful hips, mental disorders, weak hearts — were often the first to go. Finding new work often proved difficult, causing many to turn to the disability rolls for support.

The migration of so many people from work to the disability rolls is raising concern among lawmakers in Congress that the program is being stretched beyond its original intent of providing a safety net for former workers whose medical problems make them unable to work.

Last week, the Government Accountability Office found that the program made $1.3 billion in potentially improper payments to people who had jobs when they were supposedly disabled.

How long have we been in “recovery”, boys and girls? That’s right, over four years—since June 2009. Food stamps and disability are the new normal. As Debbie Wasserman-Schultz proclaimed, once people get taste of an entitlement (ObamaCare in her example), they never give it up.

Many recipients first go on unemployment, which can last a few months or even more than year. Disability, by contrast, can pay out benefits for decades. The vast majority of recipients never return to work.

I’m not sure why we conservatives even complain anymore. We’ve lost. The Fed prints money to prop up the ObamaEconomy, and the debt grows exponentially. It’s all fun and games until the bubble bursts or hyperinflation ignites.

There’ll be tears before bedtime.

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