Elimination of Earmarks Does Nothing to the Deficit

Posted on November 16, 2010 by Grolph

The incoming House and Senate members are making lots of noise about the elimination of earmarks. This is all a bunch of horseshit. The elimination of earmarks will not reduce the deficit; it just doesn’t work that way.

When the house approves a budget, there will be money allotted to certain categories. As an example, let’s say that 40 billion dollars are allocated to rural road improvement.

Senator Alpha writes an earmark to have $250,000 earmarked to improve the grading at an intersection with poor visibility. The hope is that there will be no more fatal crashes at the intersection. The local communities have been devastated by two fatalities in the past five years.

Senator Beta earmarks $14,000,000 to raise the roadway out of Dilweed by three feet. The river that flows south of Dilweed overflows the road by a foot every spring. When the road is closed, the supplies for Dilweed manufacturing cannot get through and the plant has to shut down. A majority of Dilweed residents rely upon the factory for their paychecks and the shutdown hurts the grocers, restaurants and other retailer in the area. The hope is that if the road stays open year round, the plant will not need to close and the paychecks will be written year-round.

With these two earmarks added to the rural road improvement budget, the total of the budget is still 40 billion dollars. The earmarks add no dollars to the budget total. Eliminating the earmarks will not eliminate any dollars from the rural road improvement budget.

We can eliminate all earmarks and the effect on the total budget is zero. Without earmarks, the executive branch has more control over where the dollars are allocated. Tell you elected representatives to get on with something that matters. This is a non-issue.

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Why Made in the USA Matters

Posted on November 16, 2010 by Grolph

I understand that almost everything that you and your kids want for Christmas comes from somewhere other than the United States of America. Hell, I am in the same boat. I have already purchased gifts that were manufactured in China. So this rant will not be to encourage you to only buy gifts made in the USA.

We make very few things in this country now. This rant is to reinforce why we need to bring manufacturing back to this country.

Every US factory that produces goods and service for US consumers puts money into the pockets of US citizens. Those workers go out and buy lunch and groceries and work clothes from US small businesses. Those small businesses pay more US citizens to sell and serve those goods. With money in their pockets they go ahead and buy from other retailers and support the employment of additional US citizens.

For every dollar that goes into a US sales stream, several dollars of productivity and wages can be generated. If a dollar is spent on foreign made goods, the dollar passes through one retailer and then heads out of the country.

We need to convince manufacturers to bring manufacturing back to the US for the long-term good of the nation and the long-term good of the companies.

Profitability has increased as costs were reduced through outsourcing and off-shoring. This resulted in fantastic rewards for the captains of industry who directed these changes.

You can only remove cost for so long. You can only find a lower wage labor force for a limited period of time. Eventually the year over year margin growth disappears and you fall out of Wall Street’s favor. The value of your stock declines and your stock holdings decline as well.

You may have made your millions but you are leaving a terminally ill economy for your children and grand-children to struggle with.

There are many ways to encourage domestic manufacturing. Tariffs will increase the cost of foreign products and decrease the benefits of lowest wage labor sourcing. Domestic subsidies decrease the cost of domestic goods and increase the profitability of domestic production. Both of these solutions require the action of the government. We know that we cannot depend on government to always do the right thing for the long term.

Choosing a domestically produced product is only an option if one is available. That is not likely for many products.

This leaves us to rely on the good nature of the manufacturer to choose to make products in the USA. This will require a commitment from the shareholders. The shareholders will have to accept a lower short term return in exchange for long-term stability and actual wealth creation.

Now that I think about it a little more,… we’re screwed.

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A Supply-Side Economy for All

Posted on November 16, 2010 by Grolph

I cannot believe the jackasses that are still trying to push supply-side economics. After thirty years of failing miserably, they still want us to continue this policy; an economic theory that is nothing more than the transfer of wealth from the less affluent to the privileged.

These are the same assholes that constantly bitch about wealth distribution. To be perfectly clear, they are only against wealth distribution when it is traveling from the wealthy to the less fortunate. So long as policy takes from the poor and gives to the rich, they are all for it.

The theory of supply side economics can be summarized as the removal of barriers from the activities of business. The most popular barriers to remove are taxes, regulations and tariffs. With fewer barriers in place, business will supposedly increase production and provide more jobs, better jobs and higher paying jobs.

Within the theory the reduction in taxes is made up when the total economy grows and the revenues from a larger economy will increase even when at a lower tax rate.

All of this works if you add one small piece into the puzzle. An absolute and unfaltering belief in Santa Claus, the Seven Dwarfs and the Easter Bunny.

A greater supply will increase the economy for only as long as you build the supply. Once you have inventory built and warehouses full, you better hope for some customers. Once you are carrying unsold inventory you have a millstone around your neck as you pay to service your debt. This is good for the bankers but not for you.

Supply side works well if you have a new and possibly game changing product to offer to the customer. If you have done great research and have developed a product in correct anticipation of a need (real or perceived); you can be in control as the demand gobbles up your product and boosts your profits. With fewer restrictions the success of your business is virtually assured.

Unfortunately, revolutionary or even evolutionary products are few and far between. Most products are upgrades upon existing concepts.

Just because you build more cars with new features, it does not necessarily mean that you are going to sell more cars. Your competition is adding the same new features. In fact, an excess of cars on the market will increase selling competition, suppress prices and erode margins.

Businesses enjoy long term success when there is continuous demand for their products. The United States has protected the current transportation system for decades now. We have all bought into the idea that we must have our own personalized transportation system. Many of us have more than one. The need for individual vehicles has maintained a demand for fuel. The most profitable business in the history of the world are the companies that fuel our demand for individualized transportation. This example should prove that demand is what drives a profitable economy.

So how do we grow a demand economy? We need to return to the sixties and the adage of “Keeping up with the Jones’s.” When people have sufficient money to buy the things they want, instead of just what they need, production will increase. When production increases; the demand for labor increases. When more people are working, demand once again increases; followed by more production and hiring.

If the profits created by increased demand are not shared with the workers, the demand cycle collapses. If all the profits go to the executives in the form of higher salaries and bonuses, the profits disappear. If the bolstered margins are distributed as dividends instead of hourly wage increases the margins will fail to support the stock price and the combined value of all shares will decrease.

It is time to put the supply-siders out to pasture. They had their chance to prove their theory. It is time to return to what we know worked; the demand driven success that turned the United States into the most powerful nation on Earth.

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How Do I Get My Pundit Job?

Posted on November 16, 2010 by Grolph

According to the dictionary; a pundit is a learned man; an educator.

Contemporary usage leads us to believe that the political pundits that we see on television and read in print media are knowledgeable and informed people and that they have information that is of value to all who are listening. What an absolute misuse of a perfectly good word.

I have heard pundits tell outright lies and falsehoods in their effort to promote an agenda. I have seen pundits who have been corrected while telling lies come back the next day and attempt to once again tell the same lie. It is one thing to be misinformed; it is a completely different thing to remain willfully ignorant. It is a heinous act to become informed yet continue to spread misinformation.

It is time to change the narrative. These people are editorialists. Another perfectly acceptable title would be Bull-shitters. They are sharing their opinion with us. An opinion does not necessarily need to be based upon facts.

These editorialists have evolved into their own special class. The “Pundit-class” makes their rounds amongst the media outlets and smears the bullshit upon all that they come in contact with.

The last time they had contact with the working class they were sending their filet back because it was too well-done. The insulation that surrounds the media circus and Washington DC makes it impossible for these individuals to comprehend what is happening to the United States.

We are in dire straights. Our infrastructure is in disrepair. The quality of our education is slipping. The rest of the world is looking at what we once were and is taking the successes of our New Deal and improving upon them. They are developing a better life for their citizens while we develop a service economy that by definition will not create wealth.

It is time for a new group of pundits to take the lessons being learned by the middle class and inform the ruling class about the issues across the country. It is time for us to tell them what we need instead of them telling us what we will get.

This may be a good job for an individual that is selected by the citizens of a certain geographical area. Maybe we could even hold a formal election to select those representatives. Come to think about it, we could even give the selected individuals the title of Representative and they could all meet in a House of Representatives.

It is time for our elected representatives to begin educating Washington, DC and the bull-shitters that live off of the circus that has become the government of the United States of America. Unfortunately, the money, power and prestige of being in the ruling class will likely corrupt the newly elected class of 2010 and the status quo will stay the same.

By the way: If I could get a job sharing my opinion for a good paycheck and a boatload of perks* I will take back everything that I just wrote.

*Sex

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It’s the money, stupid!

Posted on November 11, 2010 by Grolph

This election has been brought to you by the people who had enough money to buy the votes of the uninformed. And then some of the biggest money candidates couldn’t pay enough to get voters to swallow their crap.

Huge amounts of money were funneled in support of the challenger in Nevada. There are few politically savvy operatives that really supported any of Sharon Angle’s loony brain farts. The only interest was the defeat of sitting Democratic Majority Leader. It would not have mattered who was holding the position, it would have been challenged to the fullest extent of the available media air time.

I live in a moderate purple state and I saw ads that were run by Washington PACs that probably don’t even understand that a horse is still an acceptable transportation system on a nice day.

The lobbyists and the think tanks are so used to getting paid for their opinions that they believe that enough money will buy everybody else’s opinion. Fortunately there are only so many opinions for sale. Some of us still want to be protected from poisoned water, air and food. Some of us still prefer that our children not be poisoned from the toys they play with. Some of us prefer that the wheels on our cars stay on our cars while we travel down the highway.

The moneyed interests want us to believe that they will have market incentives to deliver safe water, food, toys and cars. They want us to believe that people will choose to buy only products that are designed and sold by companies that value our lives and well-being. This thought process only works if you have unlimited available cash.

If everybody could make a purchasing decision without worrying about the available funds in the checking account or revolving credit account, most people would buy the safe, clean and non-toxic option when presented with all the facts. Corporations do not share the facts. People do not have unlimited funds. We are left to dependence upon a regulatory body to assure that commodities are safe for use. That is the function of a government to make the things that we cannot afford individually affordable for all of us collectively.

We need to stand firm and prevent the government that is designed to protect the health and wellbeing of all US citizens from being purchased by the wealthy in their pursuit of increased fortunes. Don’t allow the lies and deceptions to buy your vote or opinion the next time.

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The base word in conservative is conserve.

Posted on November 9, 2010 by Grolph

One of my issues with many modern conservatives is the blatant disregard for the base word in the conservative moniker. To make sure that the object of my ire is clear, the base word in conservative is conserve.

These assholes couldn’t conserve mud in a swamp. They appear able to waste and ruin anything they can get their greedy little paws upon.

You say you want some more natural gas? We have a process that will release natural gas from shale. Unfortunately your tap water may become flammable.

You want some more soybeans? We have a genetic mutation that we will gladly release upon the global environment in an effort to increase yields. And if we find our mutation on your land you owe us big time. Oh yeah, we have no idea what the long term effects on nature will be.

Nice gulf you have here. Too bad our quest for cash doesn’t include any plan to conserve the health and safety of the seafood or the beaches the gulf is famous for.

Want more cheap energy? We will gladly blow that mountain up, sort the coal from the rubble and leave the fetid remains to kill off the flora and fauna in the vicinity

We have a penchant for instant gratification. We care not about what we leave for future generations.

It is not just the waste of fuel and other natural resources that is an issue. We waste air, water and plant life. All of which we need if we intend to keep living on the third rock from Sol.

The planet itself is changing and we can’t even agree to an honest debate on the issue. If you are a climate change denier, please just Google “Arctic Ocean Ice Cover” and see what the visual evidence is showing.

Do you have any clue as to why we have so many “Storms of the Century” lately? It is because our climate is changing.

Heavy snow is a sign of higher amounts of moisture in the atmosphere and higher moisture levels come from higher temperatures. Lots of snow does not mean it is colder. Please go back to fourth grade science and admit that you were looking out the window the entire year and you missed all that information about the three states of matter.

Please get your heads out of your collective asses and tell your elected representatives that you want your kids and grandkids to be able to play outside without having to slather on SPF 2000.

We need to start saving. The first steps are easy and extremely quick.

Turn down the thermostat in winter and turn it up in summer.

Make sure that your tires are aired up. Keep your car tuned. Ten percent of our automobile fuel is wasted as a result of poor auto maintenance. Throwing ten percent of our fuel back into the supply chain would drive fuel prices down within weeks.

Ask yourself if you really need to start the car to go to the convenience store, or the church or the gym?

Are you leaving lights on that don’t need to be on?

There are so many easy actions that can be taken that can make an impact now. These actions will not take years to build and develop.

We waste because it has become too easy to waste. Toss all the leftovers in the garbage bin and haul it to the curb on Thursday.

We need to stop wasting. And we need to take back the word conservative from the whack jobs that are the right-wing of the United States of America.

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Senator Mitch McConnell is still the Minority Leader

Posted on November 7, 2010 by Grolph

Last month, before the Midterm elections Senator Mitch McConnell was the minority senate leader. This week, we have seen the Senator all over the media; making declarations of how the Democratic party will need to compromise with him. We have seen Mr. McConnell make challenges against the reelection of President Barack Obama. We have seen the senior senator from Kentucky declare that his idea of compromise is the full capitulation to Republican ideals.
I have a simple reminder for Mr. McConnell; you are still the minority leader. Your position in the senate has not changed. The seats that the Republican party picked up in the senate makes little change in the ability of one party or the other to get legislation passed. The Democratic party and Senator Harry Reid are still in charge of the senate schedule.
And please don’t forget, the Junior Senator elect of the state of Kentucky is one of the senators that really does not support your agenda. He has his own agenda.

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A time before microwave ovens.

Posted on November 6, 2010 by Grolph

I am almost fifty years old. I can remember a time when there wasn’t a microwave oven in every kitchen or break room. That means that there is a significant population that has never lived without microwave ovens.
Microwave ovens meant the end of having to know how to cook. Microwave ovens meant that you no longer had to plan before making a hot meal. Microwave ovens introduced us to instant gratification. We have become a microwave country.

We want results and we want them now. We are no longer willing to wait for long term, stable, corporate profits. We want profits and dividends NOW without regard for long term success.
We want to drive huge cushy vehicles NOW without regard for the long term effect on the environment.
We want our elected officials to fix all the errors of the past three decades NOW without regard for the amount of time it took to sink into the current quagmire.
We want a more successful and sexy partner NOW without consideration for the fact that we were the ones that wore them out and drove them to drink in the first place. (You didn’t really drive them to drink; they chose to drink because you are an asshole.)

In our quest for instant gratification we now have remote start for our vehicles so we don’t have to sit in a cold car in the near future.*
We already want a toned and healthy body without having to exercise and a successful career before we start working. If we keep on this path we will demand dividends before we make investments and orgasms before we have sex.

Progress and sane solutions take time, the same way that making bread takes time. Give our representatives some time and support before you decide to teach them a lesson and turn the government over to people as impatient as your children.
There is truth to the addage, “Good things come to those who also wait.”

*I feel so sad for you; you might have to sit in a cold car for three minutes as you start driving. And don’t tell me that you have to warm up the engine before you start driving it. The auto manufacturers say that current cars do not have the same requirements as the used cars we drove when we were in High School. Yes, you should try to let the engine come up to temperature to make sure that condensation is driven out of the oil. An engine warms up fastest when under load, not when sitting in the driveway waiting for you to put your soft ass in the driver’s seat.

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Social Security does not add to the national debt.

Posted on November 6, 2010 by Grolph

First, a little clarification:

The Social Security Trust is similar to a conventional insurance company. A large group of contributors pays into an account. The money in the account is used to make payments to the current recipients. Any extra money is placed in secure long term investments.

Now, an analogy:

Joe has a good paying job and is secure with his income. Jim also has a good paying job and is secure with his income. Joe likes to buy lunch, drive a new high end car and keep the heat at 74 degrees during the winter and 68 degrees during the summer. Jim brown-bags it, drives a modest late-model car and will either dress up or down based upon the weather.
One day Joe is talking to Jim and finds out that Jim has as much in the bank as Joe has accumulated in credit card debt. Joe makes a deal with Jim. Joe will trade his debt and a promissory note for Jim’s cash. Joe offers a reasonable, guaranteed interest rate and Jim takes him up on the deal.
Joe starts buying better lunches, bigger cars and decides that he likes fresh air; so he is going to leave a window open year round. Jim continues to live his modest lifestyle.
One day Joe fins himself in deeper and debt than ever. Jim is doing OK.
Joe blames Jim for the financial situation he is in and asks a judge to take all of Jim’s money and give it to him, as well as declaring the promissory note invalid.
Is Joe acting in a reasonable or acceptable manner?

Why this all matters:

Our government is in a difficult financial situation. The revenue collected through income taxes is intended to pay for the operating expenses for the government’s annual budget. This is like Joe’s situation.
The government set up a separate tax that funds the Social Security Trust Fund. This fund is currently financially sound. This is similar to Jim’s situation.
The government has already taken the money in the trust fund and replaced it with Government bonds. This is not the bad thing. Government bonds are a reasonable financial tool for long term investments. Bonds are not worthless pieces of paper unless the government defaults on the financial agreement.
The deficit hawks wants to renegotiate the deal that was originally made with the workers in this country. The hawks want to take the workers’ mandatory retirement savings and cut the payouts. Why? So they don’t have to pay back the loan that has been made in the form of bonds.
The hawks also believe that they can continue to pay the current recipients of the trust the same amount they are used to getting while giving the assets of the trust back to the current contributors. This is what the plan to privatize Social Security amounts to, the creation of money from nothing. If the government is going to distribute those checks to the current workers while still paying out current retirees there will be debt that will fall on someone.
Don’t forget, the plan to privatize Social Security is also a plan to put the funds from the current trust within the reach of the bankers and brokers so they can skim off transaction and management fees.

Jim’s rational approach to spending and saving did not create Joe’s debt habit. The Social Security Trust’s prudent financial management did not force the government into debt and the trashing of the trust will not solve the Government’s debt habits.

Joe needs to reign in his spending while still fulfilling his obligations to his creditors. Joe may find that he is going to go further into debt as he changes his spending habits. It may take years before he is saving money for the future.
The government needs to get their spending in order while still fulfilling the promises made to the citizens of the United States. We will probably have to go further into debt before we can start paying it off.
Don’t let the deficit hawks steal our social safety net while adding to your debt. Demand that they solve their financial problems within their own operating budget.

Just a thought:
5% of the world’s population (The United States) pays for almost half of the world’s defense spending. Maybe there are some changes that could be made here.
Remember, a billion dollars spent on bridges will benefit all the people that cross those bridges for years to come. A billion dollars spent on bombs benefits whoever makes the bombs. And when those bombs are used, nobody benefits.

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Americuh

Posted on November 5, 2010 by Grolph

I am confused every time I hear a politician blather on saying some shit like, “The people of America have spoken and we are going to heed their will.” Or some other mindless drivel that sounds good but means nothing.

You cannot get a passport from America. You cannot have a birth certificate from America. You cannot vote for President of America. And we probably did not ask all of America how they felt about the issue in the first place.

Yes, we do live in America; so do Canadians, and Columbians, and Panamanians, and…

When I visited Panama; one of my hosts even mentioned that they were rather offended by the fact that US citizens consider themselves to be the “true Americans.” America is a pretty big place, even bigger than the United States of America.

If you can vote for the President of the United States you are a US Citizen.

This may be pretty trivial in the whole scope of things but it is a small step in the transition to thinking globally.

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