The Conversation

Economy: Issues related to the economy and economics

'Living wage,' unaffordable products

Apr 4, 2014 1:13 PM PT

When President Obama took to mocking Republican budget proposals (which, unlike Democrat proposals, exist) in front of a college audience by calling them "stinkburgers" and "meanwiches," I was struck by how the media lets him get away with being as nasty and divisive as he wants to be.  No Republican would be allowed to get away with insinuating that Democrats are motivated primarily by greed, lust for power, or some inhuman joy they take from watching people suffer... let alone stating it outright, with the language of a third-grader.  Not only would the divisiveness and mean spirit of the rhetoric draw a firestorm of criticism, but such a hypothetical Republican would be excoriated for talking down to his audience.

Andrew Johnson at National Review made a different point about the President's outburst, by focusing on the delicatessen anecdote he told, right before veering into talk of stinkburgers and meanwiches:

The president paid a visit to Zingerman’s Deli in Ann Arbor, Mich., today as part of his push to increase the minimum wage.

Zingerman’s, he says, pays its employees “fair wages.” Whether they’re fair enough to afford the lunch the president had isn’t clear: He ordered a small Reuben for $13.99; larges go for nearly $17.

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Bankrupt Detroit Beats L.A. in Job Growth

Apr 2, 2014 6:27 AM PT

The Los Angeles Times reports Wednesday that a UCLA study showed that "Los Angeles has gone 23 years without job growth," losing 3.1% of the jobs it had in 1990--dead last among U.S. cities, even behind Detroit.

"Among problems plaguing the city: the high cost of housing, congestion, lack of skilled workers and an unfriendly environment for businesses, said William Yu, an economist at the UCLA Anderson Forecast," notes the Times' Shan Li. Much of Li's article is devoted to the finding that California's current drought could lower job growth even more, which is a more convenient explanation for the left than the city's anti-business policies.

Stop Detroit's Shell Game on Assets

Mar 24, 2014 10:40 AM PT

For months now I've been shouting Greg Gutfeld's sentiments on paying Detroit's creditors and pensioners -- "Sell the damn art!"

Next month the city's emergency city manager, Kevyn Orr, will present yet another plan on digging Detriot out of its financial hole.  Despite liberal elitists calls to protect the art -- one of Detroit's largest assets -- from the auctioning block, the calls to "sell the damn art" continue.  From an op-ed in today's Detroit News:

Detroit is unique among major cities in having funded directly huge portions of its signature art museum’s existence, including its building, operations and many of its works. 

The precise value of the collection isn’t known, but the auction house Christie’s appraised 2,800 city-purchased pieces – just five percent of the collection – at more than $800 million. 

In other words, contained within the walls of 5200 Woodward Ave. are billions of dollars in assets that can be used to repay the city’s debts, both to pensioners and to bondholders, many of whom are retirees themselves. 

Officials from the city, state, DIA and private foundations instead have offered a plan that would spin off the institute into an independent non-profit trust, in exchange for some $815 million in funding from state taxpayers and private interests. 

Those proceeds would be earmarked solely for the General Retirement System and Police and Fire Retirement System pension plans. This would turn bankruptcy law on its head, using an asset sale to pay off only one class of unsecured debt. 

Louisiana Puts Its Foot Down: No More Food Stamp Tattoos

Mar 23, 2014 11:30 AM PT

The Associated Press reports on the latest act of unspeakable cruelty from heartless, tightwad red-state officials:

Louisiana welfare recipients will be prohibited from spending the federal assistance at lingerie shops, tattoo parlors, nail salons and jewelry stores, under new limits enacted by state social services officials.

The Department of Children and Family Services announced the emergency regulations late Thursday. They cover the Family Independence Temporary Assistance Program — commonly known as welfare benefits — and the Kinship Care Subsidy Program.

Both programs pay cash assistance to low-income families for items like food, clothing and housing.

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Report: Weak White House Sanctions Rally Russian Market

Mar 17, 2014 7:51 AM PT

As I write this, President Obama is announcing a list of limited sanctions against specific individuals in the Russian government meant to punish them for "violating Ukraine's sovereignty." The idea is to go after the personal finances of top Russian and Ukraine officials, including the former president of Ukraine and members of Putin's inner-circle. Putin, though, is not on the list.

Greg White, the Moscow Bureau Chief for the Wall Street Journal reports that news of the White House sanctions did not have the intended effect. Relieved over how limited they are, the Russian market enjoyed a rally:

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Dereliction of Duty in Detroit

Mar 11, 2014 7:13 AM PT

I've had my eye on Detroit's bankruptcy proceedings because it is indicative of what's to come for a lot of cities.  How Detroit deals with its bankruptcy could also set a precedent for other cities forced to deal with the decisions of bankruptcy, satisfying pensions and debtors.  Unfortunately, Detroit's Emergency Manager Kevin Orr is shirking his responsibilities to the city and creditors by not making the hard choices to put Detroit on sound financial footing.

As I wrote a few months ago, the key is the art.  

If you or I were to file for bankruptcy, we would be forced to sell our assets before defaulting to our creditors and other contractual obligations.  That Warhol passed down from your crazy aunt who partied at Studio 54?  Gone in 15 minutes.  And that's exactly what should happen in Detroit.

The Detroit Institute for Art (DIA) has billions of dollars in art, but elitists in Detroit suburbs are conspiring to keep the art so the collection can't be split off and sold.  A few foundations attempted to raise money to secure and "own" the art through a private fund of $300-500 million, just a fraction of what it is worth.  Basically, this fund was trying to buy the art at a deep discount so it was off-limits and Detroit's entire debt would fall on taxpayers and pensioners.  Pensioners that include firemen and police officers.  We may not agree with public sector unions and their tactics, but promises were made to these workers and the city must put all options on the table before sticking pensioners with the bill.

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Michelle Obama Offers Relief for Nation's 'Confused' and 'Bewildered' Shoppers

Feb 28, 2014 2:02 PM PT

Gotta give a quick shout out to "everywoman" Michelle Obama, who yesterday was kind enough to introduce the administration's new, improved nutrition labels for food packages. The new labels are designed to make shopping less difficult for easily confused moms who are flummoxed by nutrition labels.

The "bewildering" dilemma women have been experiencing in grocery stores, was described by Michelle Obama, thus:

"So there you stood, alone in some aisle in a store, the clock ticking away at the precious little time remaining to complete your weekly grocery shopping, and all you could do was scratch your head, confused and bewildered, and wonder, is there too much sugar in this product? Is 50 percent of the daily allowance of riboflavin a good thing or a bad thing? And how on Earth could this teeny little package contain five whole servings?

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Obama's Highly Touted List Of Pro-Minimum Wage Economists Includes A Few Crackpots

Feb 27, 2014 9:30 PM PT

As part of their election year strategy of steering the public's attention as far away from ObamaCare as humanly possible, Democrats have been pushing for a vote on a minimum wage hike in the Republican-led House - which they know, is not going to happen.

Not that it matters. Because Democrats want to put Republicans on the defensive for failing to care as much about the poor as they do. Throwing a wrench into their plans last week, however, was the CBO with a study that showed a minimum wage hike to $10.10  an hour would lead to a reduction in employment of anywhere from 500,000 to 1 million workers. Thursday, Federal Reserve Chairwoman, Janet Yellen backed the CBO's analysis. 

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California Couple Finds $10 Million in Gold Coins in Back Yard

Feb 26, 2014 6:11 AM PT

A couple in California stumbled across the most valuable buried treasure find in U.S. history, the Los Angeles Times reported Tuesday, when they discovered rusting cans on their property that contained 19th-century gold coins with a face value of over $28,000 and a market value of more than $10 million. 

The coins include several rare finds, including an “1866-S No Motto Double Eagle,” which the Times’ Ruben Vives reports is worth more than $1 million.

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40 hour work weeks: too much, or not enough?

Feb 21, 2014 7:01 AM PT

If you noodle around liberal web sites a bit, you'll come across a talking point designed to cushion the blow of ObamaCare job losses: a lot of those cuts, such as the 2.5 million "job equivalent" losses predicted by the CBO in their bombshell forecast, are more about reduced hours than outright termination.  The old-and-busted O-bot talking point was that business owners would never cut hours to get under the 30-hour threshold needed to escape the worst Affordable Care Act mandates, and any executive who explicitly stated he was carrying out such plans was a lying Republican hack.  Presumably the hundreds of thousands of employees who said their hours were indeed trimmed to 29 or less were also lying Republican hacks.  

But that talking point is dead now, especially since the government is one of the employers that has explicitly stated hours are getting shaved to evade the mandates.  So the new brainstorm bubbling up from the fever swamps of the Left is that working less is a good thing.  If you can get by on working 29 hours, with subsidies looted from other taxpayers to support your food, housing, and medical needs, what's the problem?  That's paradise, right?  We should celebrate the dawn of a new age in which everyone gets to be a "child" until they turn 27, then work 25 hours a week, have their EBT card automatically refilled with digital food stamps every month, and have their health needs covered by heavily subsidized ObamaCare policies!

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The Obama Economy and Lingering Effects of Long-Term Unemployment

Feb 20, 2014 9:08 AM PT

A recent survey done by shows the effects of unemployment on job seekers.  For many, it's not just the loss of income. 

According to a new CareerBuilder survey, the loss of a regular income has affected the long-term unemployed in various ways, such as not having enough money for food (25 percent), strained relationships with family and friends (25 percent) and maxing out credit cards to pay other bills (12 percent). 


Challenges of finding work

One of the main concerns job seekers often have when they've been out of the workforce for a while is that they'll lose valuable skills. In fact, 45 percent of long-term unemployed say they're worried that their skills have depreciated. Of these respondents, more than half say their technology skills declined.  

When asked to share some of the major challenges they encounter when looking for a job, the long-term unemployed point to:

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CBO Director Fires Back at White House Claims He is Wrong on Minimum Wage

Feb 19, 2014 10:00 AM PT

Congressional Budget Office Director Douglas Elmendorf fired back Wednesday morning at criticism from the White House over his most recent economic report. The White House and CBO disagree over the effect raising the minimum wage would have on employment.

The argument is much more than an academic disagreement. Having the President's signature economic proposal labeled a job killer would be another political blow to Democrats already facing an uphill climb in 2014.

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Happy 5th Anniversary Porkulus Act

Feb 17, 2014 9:47 AM PT

Five years ago, Presidente Obama saw his failed Recovery Act sail through the Congress and give birth to that crazy like a fox Tea Party.  The Act cost some 40 billion more than originally expected, and helped catapult Mike Lee and Marco Rubio into the Senate, as well as help Republicans retake the U.S. House of Representatives.

As expected, Rubio and others in the Senate, have come out swinging against the Obama's Porkulus Act.

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'Job lock' and supply-side economics

Feb 13, 2014 8:26 PM PT

Back when that H-bomb of a Congressional Budget Office forecast landed on ObamaCare, and panicked Democrats began running around like maniacs and burbling that unemployment is the essence of freedom, I thought they were making a huge and dangerous concession by admitting that government benefits provide a concrete and effective disincentive to work.  

It's a concession to reality, to be sure.  Of course people respond to such disincentives.  But it has been an ironclad tenet of socialist dogma for decades to deny this, insisting that no significant number of people prefer welfare to work, refuse employment when it doesn't pay appreciably better than their government benefits, or reduce the amount of work they perform in response to tax policy.  Remember, dynamic economics is the eternal bane of socialism; they are static theorists who insist as a matter of religious faith that only the most extreme government burden could possibly make the private sector go wobbly in the knees.  Atlas does not shrug.

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Union strongarm tactics mean big bucks

Jan 27, 2014 6:50 AM PT

Hard times for AFSCME in Wisconsin, according to the Milwaukee Journal-Sentinel, as Governor Scott Walker's collective bargaining reforms cut an astounding 45 percent from the union's revenue stream.  A union official lets slip the reason, in the course of attempting to peg a smiley face to the end of the grim news: "Council 40 executive director Rick Badger says that while the declines in revenue stemming from Act 10 are expected, he has been encouraged by the number of workers who have continued to pay voluntary dues."

In other words, once the government isn't acting as a taxpayer-funded super-powered collection agency and stripping mandatory dues out of public employee paychecks - a service every business enterprise in America would pay handsomely to receive, never mind getting it for free - the union's financial muscles immediately went limp.  Were they really expecting more than forty or forty-five percent of their members to stop paying dues, and therefore find last year's receipts encouraging?

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California's Leaders Are Watching the Wealthy's Movements

Jan 22, 2014 9:25 AM PT

California state leaders are monitoring millionaires to assess whether a recent jump in income taxes could lead to an exodus of the wealthy.

The San Francisco Chronicle reports that in 2011 "the top 1 percent of tax returns accounted for 41 percent of the state's personal income tax revenues." That was before the passage of Prop. 30 which raised California's top income tax rate to 13.3 percent, the highest in the country. The increasing reliance on soaking the rich means "state leaders are watching closely" the movement of wealthy people out of the state. The Chronicle offers a number of examples of individuals who have decided to move out:

Lee Schneider, a hedge fund salesman who works from home, also cited Prop. 30 as the "deciding factor" for his move from Walnut Creek to Austin, Texas, in 2012. The California native had recently built a $2 million house at the foot of Mount Diablo and took a loss on the sale, but "I can make half of it back in one year of tax savings," he says.

Schneider's neighborhood in Texas, which has no state income tax, is full of cars with license-plate frames from California dealerships. On a flight from Austin to Los Angeles shortly before Christmas, 11 of the 12 seats in the emergency row were occupied by people who had moved from California to Texas, he says.

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Inequality between the apples and oranges

Jan 21, 2014 8:31 PM PT

Thomas Sowell calls out the merchants of envy for two of their biggest "income inequality" myths in his latest column.  In both cases, a political crusade is built upon willful misrepresentation of data.  

The more complex matter he discusses is something he has written about many times in the past: the way individual people move up and down income brackets over time, but the income inequality crusade is based entirely on the performance of the brackets.  In other words, the top "one percent" might be pulling in more dough these days, but not all of the actual individual people in the One Percent today were there five or ten years ago, and not all of them will be there five or ten years from now.  Another way this fallacy manifests itself is deliberate ignorance of the effect age has on income and net worth - a person of modest means in his twenties might well end up with significant income, savings, and property by the time he retires.  

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LA Unions Use 'Provocative' Billboard to Campaign for $15 Minimum Wage

Jan 17, 2014 2:39 PM PT

The Los Angeles County Federation of Labor is using a billboard campaign that it calls "provocative" to campaign for a $15-per-hour minimum wage. The billboards resemble the signs posted on municipal boundaries and read: "Los Angeles: City Limited, Poverty Wage Pop 810,864." The term "poverty wage" refers to residents who earn hourly wages of less than $15. The current federal minimum wage is $7.25-per-hour, which President Barack Obama has proposed to raise to $10 as part of his campaign against inequality.

Curiously, the billboards do not mention the number of unemployed people in Los Angeles County: 466,257 as of November 2013, which does not include those who have given up looking for work in the era. One of the principal arguments against higher minimum wages is that they discourage businesses from creating new jobs.

Detroit Deal Satisfies Liberal Elites, Not Debts

Jan 16, 2014 6:30 AM PT

A few weeks ago I wrote about Detroit's bankruptcy and an adequate solution for paying Detroit's creditors.  Greg Gutfeld summed it up on The Five when he said, "Sell the damn art."

Columnist and radio host Derek Hunter has a great piece on Townhall today that summarizes the problems with the recently announced $330 million deal to save the art.  He writes:

This deal actually is a symbol of what's wrong with Detroit. Liberal elites prioritize the art collection, not safety, not balanced budgets, not services to the city. Unions prioritize their members first, not overall city success. Democratic politicians prioritize short-term deals to help their constituencies rather that long-term financial stability. Recognize that song? It’s the same old crony tune that got the city here in the first place.

Repeating old patterns of short-sighted deals, putting emotion (the DIA love is real, but irrelevant given the bankruptcy and how few people visit it) ahead of reason and protecting small constituencies at the expense of everyone else won't get the city out of this mess.

And that's why this DIA deal is wrong. It's not part of a long-term revitalization plan. I'm not even sure it's really has anything to do with bankruptcy.

Let me be specific.

First, the $330 million put up by foundations is a ridiculously low number. Even Christie's valuation was $866 million and that was considered very low because they only appraised a small percentage of the art. An estimate by the Detroit Free Press pegged the value at more than $2.5 billion. It seems the DIA collection is being deliberately undervalued to "protect" it. Admirable, I suppose, but that doesn’t change the city’s economic reality so it’s irrelevant.

Second, this deal does NOT really aid bankruptcy. Bankruptcy is about debtors and creditors. This does not involve creditors so it does nothing to stabilize Detroit's finances. Without a strong credit rating and investor confidence, Detroit will have to borrow at higher rates, if it can (eventually) raise new capital at all. And if the city can't raise new capital, how will it repair its long neglected infrastructure and aid economic development?

Helping pensioners is noble, but many live in Florida or Arizona and will not contribute to Detroit's revitalization. That may sound cold, but it’s the reality no one wants to face. If the city’s actions don’t prioritize its own financial stability this will all have been for nothing. And pensioners can be helped through a broader bankruptcy deal.

Lastly, I question the bankruptcy judge's priorities. Detroit has an $18 billion problem and Judge Steven Rhodes has spent an enormous amount of time and effort to engineer a deal between foundations, the DIA and pensioners. It seems to me Judge Rhodes should be focusing on a deal between the city and its creditors. A deal that should include maximizing the city's assets.

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Income inequality and crony capitalism

Jan 13, 2014 1:16 PM PT

National Review has an article from James Pethokoukis of the American Enterprise Institute in which he offers suggestions for the Republicans to swipe the "income inequality" issue, by highlighting how political connections and favoritism account for much of that growing gap between rich and poor:

Inequality has increased across advanced economies. Macro factors such as globalization and technology deserve most — but maybe not all — of the “blame.” Big Government loves to pick winners and losers in the private sector. Some lucky ducks owe their place in the 1 percent or 0.1 percent or 0.01 percent to federal favoritism. Conservatives shouldn’t mind at all when value-creating innovators and entrepreneurs strike it rich while crony capitalists do not. The precious tax breaks and subsidies that go to rent seekers, such as those in the agriculture and alternative-energy sectors, should get the ax. Sorry, Big Sugar and Big Solar.

At its core, such an anti-cronyism, anti-inequality agenda would use competition and markets to fight Washington’s natural bias for elite and entrenched interests. 

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This economy isn't going to get the medicine it needs

Jan 8, 2014 11:01 AM PT

After President Obama toddled forth to once again extol the amazing stimulus powers of perpetual unemployment welfare - a stimulus that has been completely undetectable for the past five years, but Democrats assure us it will kick in any day now - people who don't wear leftist ideological blinders wrote a number of columns explaining what we should be doing.  As Donald Lambro pointed out, we know what works, just as we know Obamanomics doesn't:

In Congress this week, the focus is on legislation that would provide funds for extended unemployment benefits, when the debate should be about growing the economy to produce jobs and higher incomes.

We know what’s worked in the past — cutting taxes on capital investment, on businesses that have the second-highest tax rate in the industrial world, and on income.

Right now, the government is taxing every nook and cranny of our economy, and Obama wants to raise taxes even higher so he can spend more.

In his second term, after carrying 49 states by ending a deep recession in two years, President Reagan signed a bipartisan bill to cleanse the tax code of corporate welfare and other loopholes. He used the increased tax revenue to lower income tax rates to further boost economic growth.

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NC Councilman Who Resigned In Klingon Should Have Used Chinese

Jan 5, 2014 3:47 PM PT

By the time the Klingons arrive to lay waste in glorious battle we may have fallen to the Chinese in economic battle. 

It begins with one word, debt. The current US National Debt stands at $17,314,687,938,331 and growing every second. Indian Trail, NC Councilman David Waddell resigned in Klingon but also due to fiscal irresponsibility and what he saw as runaway development in the town with taxpayer dollars. Waddell, a plumber by trade stated he thought he would be more effective by going to board meetings as a citizen. There is a lesson to be learned here that when operating within the system does not work it is time to get engaged as a citizen.

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The longer someone takes benefits the longer they are unemployed

Dec 27, 2013 6:43 PM PT

The longer someone is on employment benefits...

  • Skills atrophy 
  • New people enter their particular field 
  • The economy suffers in an aggregate manner as productivity stays low 
  • Labor participation rate suffers 
  • More tend to drop out of the workforce and rely on government assistance or others such as relatives which also drains the overall economy 
  • The money to pay unemployment is borrowed and accrues interest which has to be paid back by taxpayers  
  • I know it sounds harsh but time for hard decisions by Americans to take whatever job they can and multiple jobs if needed 
  • Time to go back to 26 weeks maximum of unemployment benefits and if necessary we can gradually but must scale back from 99 weeks for the nations economic health.

Income Inequality via The Institutional Left Meets Reality By The Numbers

Dec 9, 2013 11:00 AM PT

Income inequality is an easy phrase for the left to throw around but the issue is more complicated. Yes there is a growing income gap, but there are also a growing number of wealthy Americans. It is easy for the left to attack the 1% but we can't ignore the other 99%. 

Of the remaining 99% in 2012 the top 20% of US households earned 51% of the nation's income. 

While paychecks shrank for most Americans after the 2007-2009 recession, theirs held steady or edged higher. In 2012, the top 20 percent of U.S. households took home a record 51 percent of the nation's income. The median income of this group is more than $150,000.

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Income inequality, minimum wages, and inflation

Dec 6, 2013 1:56 PM PT

The latest distraction from ObamaCare failure is a renewed emphasis on "income inequality," which is one of those endless, highly subjective crusades the Left views as a bottomless well of power.  It's like global warming in many ways: its definition is fluid, there's no way to "disprove" it because it will always exist, and it's a problem that can never be "solved."  There will always be a relatively small group of people who make considerably more money than the average.

Another useful thing about the "income inequality" equation of power is that the variables can be manipulated at will by the power-hungry leftist.  After all, such inequality has gotten worse - much, much worse - under the policies of the modern era's most left-wing President, Barack Obama.  And yet, he gives speeches and complains about it, as though he were a mere spectator to an economy controlled by his government to an unprecedented degree!  And his audience laps it up, without a single curious soul bothering to point out that Obama's been the one who made "income equality" worse over the past five years!  

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NY Fast Food Strike: A Roving Band with Minders

Dec 6, 2013 1:31 PM PT

The union organized fast food walkout Thursday turns out to have been heavy on the walking and light on the "out." In New York at least, there was a group of about 100-150 who walked from one restaurant to another. According to Reason, any place the roving band wasn't picketing it was business as usual.

Reason interviewed several people about the protest, one of whom admitted they were being paid through by a union slush fund to be there. Eventually one of the group's organizers decided it would be best if everyone stopped agreeing to talk. Toward the end of this clip you'll see him stepping in and whispering in people's ears.

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Minimum wage distractions

Dec 5, 2013 11:29 AM PT

In response to Unions Organize Fast Food Workers Demanding $15 an Hour:

This is all part of a coordinated Democrat strategy to change the subject away from ObamaCare, which is absolutely killing them.  The only way it could be more obvious would be to have these rented union goons and Occupy Wall Street leftovers start whacking people in the forehead with Nerf bats and scream, "Stop talking about ObamaCare!"

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The trickle-down economics of Barack Obama

Dec 4, 2013 1:59 PM PT

I see that President Obama is going off on "trickle-down" economics and "income inequality" again.  Of course, it's an obvious desperation ploy, a frantic effort to change the subject by a nervous politician who thinks he can't lose by playing the class warfare card.  Never mind the failure of ObamaCare - somebody out there has a dollar more than you, and Barack the Avenger is going to make them pay!

I suppose this is marginally less obvious than standing on stage and yelling "SQUIRREL!" but it's no less absurd.  For one thing, all of this "income inequality" has been getting radically worse under Obama's policies.  Are his dead-end supporters ever going to tire of his Empty Chair routine, in which he pretends he just arrived in D.C. yesterday and can't believe the mess he found?

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Black Thursday, Black Friday, blue Monday

Dec 2, 2013 9:35 AM PT

In response to Oconomy: Shoppers Spend Less on Holiday Purchases:

That is so not good news.  Retail operations will suffer from reduced income during the crucial holiday season - at a moment when their labor costs are rising dramatically, and the "living wage" dimwits want to make it even higher.  Expansion plans will be scuttled.  Payrolls will freeze, or be cut even further.  

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Oconomy: Shoppers Spend Less on Holiday Purchases

Dec 2, 2013 5:47 AM PT

New numbers released by the National Retail Federation reveal that shoppers spent less money during the holiday weekend. While the number of shoppers increased by two million, the average amount of money they spent dropped.

Average sales dropped by 4% from 2012 figures with shoppers spending an average of $407.20 this year.  Overall sales during the holiday are estimated at $57.4 billion which is a 3% drop from last year's figures. 

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Pope Francis versus capitalism

Nov 29, 2013 5:04 AM PT

I found it necessary to respectfully disagree with Pope Francis the last time he took a swing at capitalism.  On that occasion, it seemed likely that his remarks were more specifically directed at sweatshop exploitation in the Third World, which had recently taken a horrible toll in human life.  But of course, the Left seized upon him as a new champion of socialism who wanted to throw down against economic liberty in general.

The Pope went into the ring against capitalism again the other day, and this time it was more clear that his remarks were meant as a broad critique, although the lefties who even more seized on his comments to push their ideology are reading way too much into them.  Shikha Dalmia at the Washington Examiner provides a good summary of what the Pope said, before usefully reminding him that capitalism is the engine of wealth that provides the money for Catholic (and every other) charity:

For about the sixth time since assuming office eight months ago, the pope this week offered a sweeping condemnation of “unfettered” capitalism, blaming its alleged obsession with the “golden calf” for perpetuating poverty, oppression, tyranny and much else.

The pope claims that the “opinion” that “economic growth, encouraged by the free market, will inevitably succeed in bringing about greater justice and inclusiveness” has “never been confirmed by the facts.” (He obviously hasn't been listening to Bono, which speaks well of his taste.)

Therefore, governments “charged with the vigilance of the common good” must take strong steps to “exercise any form of control,” including redistributive taxes, to stop the march toward a society where “those excluded are no longer its underside or its fringes or its disenfranchised — they are no longer even part of it.”

No doubt such purple prose about “exclusion” will gain him adoring fans among the left — notwithstanding the irony that he is speaking for an institution that excludes half of humanity — women — from the ranks of priesthood. But is capitalism the cause of poverty and is redistribution the cure?

No and nyet.

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The hidden gardens of government revenue

Nov 20, 2013 6:54 PM PT

The great Walter Williams leaps astride one of my favorite hobby horses, the fundamental dishonesty of hidden government taxation, and takes it for a mighty gallop through the absurd fiction of "employer contributions" to Social Security and Medicare:

Congress tells us that one-half (6.2 percent) of the Social Security tax is paid by employees and that the other half is paid by employers, for a total of 12.4 percent. Similarly, we are told that a Medicare tax of 1.45 percent is levied on employees and that another 1.45 percent is levied on employers. The truth of the matter is that the burden of both taxes is borne by employees. In other words, we pay both the employee and the so-called employer share.

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Black Thursday: Even More Retailers to Open for Sales on Thanksgiving

Nov 13, 2013 4:48 AM PT

More stores are joining Walmart to open for holiday sales on Thanksgiving Day. Kohl's, Target and Toys R Us will be opening their doors to sale-seeking shoppers on the holiday.  

Industry analysts say that the retailers are responding to consumer interest and shorter shopping season this year. The shopping season is the shortest in a decade.  

"Black Friday is the Super Bowl of retail, and it’s very important to us," said Duncan Mac Naughton, chief merchandising and marketing officer for Wal-Mart U.S. "We anticipate a very competitive environment."

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Another California City Headed for Bankruptcy?

Nov 13, 2013 3:53 AM PT

Another city in California is considering bankruptcy, mainly due to runaway pension costs and salary levels. Desert Hot Springs, a small city 110 miles east of Los Angles would be the third city in California dealing with bankruptcy. 

Yesterday, the city warned it will run out of money by March 2014.  A new city finance director found a $3 million shortfall in the city's budget of $13.5 million. 

"It's obvious we can't continue with salaries and pensions that are in the stratosphere, no matter how much love there is for our police department," said Russell Betts, a council member.

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Oconomy: Report Shows Consumer Confidence Plunge

Oct 29, 2013 8:27 AM PT

The Conference Board released its monthly consumer confidence report, with a notable drop from 79.7 down to 71.2.   “Consumer confidence deteriorated considerably as the federal government shutdown and debt-ceiling crisis took a particularly large toll on consumers’ expectations," Said Board director Lynn Franco.

The Consumer Confidence Survey is a "probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch."

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Report: 15% of Youth Out of Work, School

Oct 21, 2013 2:43 AM PT

According to a study released today, 15% of youth aged 16-24 are out of work and out of school. The Opportunity Nation coalition reports that almost six million young people "have neither desk nor job."

And it's not just the young who are suffering. The report finds that "49 states have seen an increase in the number of families living in poverty and 45 states have seen household median incomes fall in the last year."

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Tea Party and Trade

Oct 15, 2013 3:14 PM PT

Col. Alan West, the veteran, stalwart Tea Party conservative and former congressman from Florida, staked out an anti-free trade position earlier today at Breitbart. On many issues, I agree with Col. West, but on trade I cannot. Though additional authority of any kind might seem rather dangerous in the hands of a president who has the tendency to abuse it, the fact is that fast-track authority to negotiate trade deals is nothing new.

Furthermore, it is necessary. Trade agreements are incredibly complex and require our representatives to have wide discretion. They are also almost always in the best interest of the United States. Not only is trade good for our economy, but it is essential to our global influence and even our national security. When we back away from free trade in, for example, East Asia, our Chinese rivals are better able to enter and fill the vacuum.

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A Paradoxical Case for Yellin at the Fed

Oct 10, 2013 6:02 AM PT

The New York Times has run an extensive profile of President Barack Obama's next nominee to head the Federal Reserve, Jessica Yellin. Conservatives are worried that despite her qualifications, she's a liberal Democrat committed to using monetary policy to stimulate the economy, which is a risky strategy and not something the Fed does very well. She's also said to have a combative, abrasive personal style.

These are reasons for concern--but, paradoxically, having an interventionist Yellin as chair would make the political case for reforming the Federal Reserve far easier to make. Ben Bernanke came into office having cautioned, for much of his academic career, against the kind of government interventions he soon indulged. Yellin would very well make the Fed a much easier target, especially if she courts conflict with Congress.

Obama Says Meanie Republicans Holding America Hostage

Oct 8, 2013 12:36 PM PT

China's Maoist Economy Has Obama Parallels

Oct 2, 2013 1:54 PM PT

The Wall Street Journal ran a very interesting analysis Wednesday about new pressures facing foreign companies in China: old Maoist tactics. Those amount to using threats of investigation to force concessions--such as price cuts--as well as public confessions of wrongdoing, not just by firms but by individuals as well. The new-old practice under China's president Xi Jinping recalls the Cultural Revolution, critics say.

That has created a more threatening business climate in China, according to the Journal's Andrew Browne. What is striking is how similar some of China's tactics are to the practices of the Obama administration, which has used threatened and actual civil and criminal prosecutions--sometimes frivolous--to extract concessions from businesses, as well as public campaigns against donors to and supporters of the opposition Republicans.

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