Category Archives: economy

Latest Lib Spin: Government cutbacks reduce GDP

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This. Is. So. Stupid….

Although the headline number for the nation’s gross domestic product – the sum of goods and services produced in the U.S. economy – came up short of expectations, the report’s component parts offered rays of hope. They showed consumption remaining strong in a recovering private sector, while a slowdown in government spending dampened overall growth.

As pointed out previously here at MCT, all government is OVERHEAD and does not add value (grow) the economy.

Only liberals can call confiscating (or borrowing) money from one group of people then transferring it to another group and call it economic growth.

Student Loan Debt Bubble

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Via CNBC:

Worried? Americans should be.

Still, acknowledging the problem is perhaps the easiest step. Much more difficult is the question of what to do about it. Not surprisingly, young, heavily indebted grads are calling for forgiveness in full or in part of their student loan burdens. Petitions on advocacy website Change.org include calls for federal student loan interest rates to be capped at 3 percent or eliminated altogether. (Indeed, President Obama is currently among those urging Congress not to allow the interest rate on federally subsidized Stafford loans, which are aimed at low — and middle-class borrowers, to double to 6.8 percent on July 1, matching the rate for unsubsidized loans.)

And yet the trouble with those initiatives, or with forgiving student loan debt in whole or part, is threefold. For starters, the straight mathematics: the losses from any such debt reduction scheme will have to be borne by someone, most likely taxpayers, at a time when government finances are already stretched.

Second is the issue of “moral hazard,” that is, rewarding and implicitly encouraging imprudent behavior rather than punishing it. (Of course, it is easier for the public at large to demand that over-leveraged banks be punished for imprudence than 24-year-olds trying to further their education.)

And third is the question of how to keep future graduates from accumulating a mountain of student loan debt just as large, if not larger, than the one just leveled.

It is this third issue which perhaps is most pressing — and most vexing —and which also offers the most opportunity for innovation. Levying an “education tax,” making college free and assigning students to institutions based on a lottery system? Abolishing “college” altogether for more specialized trade institutions instead, while at the same time requiring a “gap year” of liberal arts prior to entry? Offering high-school grads the choice between student loans or business loans to fund new ventures? These all seem ridiculous, but then so too is our current state of affairs.

Lib’s are constantly tinkering, pandering and promising rather than embracing basic economics. The only way to bring down tuition costs is to stop advocating policies (i.e. easy student loans & grants) that artificially increase demand for college. Any high school student can tell you when demand increases, prices will increase.

As pointed out previously here at MCT:

One way to drive down the cost of college tuition is getting the government out of the business of student loans. Every time government becomes involved in an economic activity, it becomes more expensive. If government student loans are severely limited and Universities see fewer students attending their hallowed halls of higher learning, cost of tuition will drop in a hurry.

Otherwise, tuition will keep climbing and people like Mary Sue Coleman will continue laughing all the way to the bank.

Of course, it’s tough to pander to college student votes if politicians can’t pull the strings when it comes to student loans.

London Olympics increasing property values. Women and children hardest hit.

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The upcoming London Olympic games are driving up property values in the surrounding areas. And, with the increase in property, comes an increase in rent.

Low-income people who live near London’s Olympic Stadium may have to move to other parts of the country due to rising rents, the borough’s mayor said Tuesday.

Newham Mayor Robin Wales said a new U.K. government policy limiting rental subsidies means that many people can no longer afford to live in the east London borough that now includes the sprawling Olympic Park.

Newham has long been one of the country’s poorest boroughs, but the newly built Olympic Stadium, a large new shopping mall and public parks have regenerated parts of the borough and caused rents to rise.

Predictably, this is a due to the policies of evil conservatives.

In Britain, people with low incomes can apply to have all or part of their housing costs subsidized by local authorities, but the Prime Minister David Cameron’s Conservative-led government last year introduced a controversial benefit cap that limits rent subsidies.

The maximum is now around 400 pounds ($646) a week for a four-bedroom house. Most people are only eligible for much smaller properties with lower benefit caps.

And, children are hardest hit.

“People are being driven out of their homes, their kids are being ripped out of schools, because they can no longer afford their rents,” he told The Associated Press. “These are people’s lives we are dealing with.”

Unreal.

Happy Earth Day to all Communists, Progressives, Eco-Warriors, Leftists and Democrats Everywhere

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“The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.”

Vladimir Lenin

Vaclav Klaus (one of my all time favorite Presidents) said this not too long ago:

I see the third main threat to individual freedom in environmentalism. To be specific, I do understand the concerns about eventual environmental degradation, but I also see a problem in environmentalism as an ideology.

Environmentalism only pretends to deal with environmental protection. Behind their people- and nature-friendly terminology, the adherents of environmentalism make ambitious attempts to radically reorganize and change the world, human society, our behavior, and our values.

There is no doubt that it is our duty to rationally protect nature for future generations. The followers of the environmentalist ideology, however, keep presenting us with various catastrophic scenarios with the intention of persuading us to implement their ideas. That is not only unfair but also extremely dangerous. Even more dangerous, in my view, is the quasi-scientific guise that their oft-refuted forecasts have taken on.

Since the wheels have fallen off the global warming / climate change hoax, and the environmentalists are not going away, what is the next eco-fad catastrophe that can only be solved by limiting our freedoms and further trashing our economy?

Sustainability.

According to the UN Rio+20 objectives outline, the upcoming conference will be all about wealth transfer… Sorry… Sustainability.

The objective of the Conference is to secure renewed political commitment for sustainable development, assess the progress to date and the remaining gaps in the implementation of the outcomes of the major summits on sustainable development, and address new and emerging challenges
The Conference will focus on two themes: (a) a green economy in the context of sustainable development and poverty eradication; and (b) the institutional framework for sustainable development.

Rio+20 Issues Briefs

The UNCSD Secretariat together with its partners has prepared a series of Rio+20Issues Briefs. The purpose of the Rio+20 Issues Briefs is to provide a channel for policymakers and other interested stakeholders to discuss and review issues relevant to the objective and themes of the conference, including a green economy in the context of sustainable development and poverty eradication, as well as the institutional framework for sustainable development.

Prepare for an onslaught of stories and propaganda urging you to use less and do less because we all have to worry  ”sustainability.”

“It is true that liberty is precious – so precious that it must be rationed”

Vladimir Lenin

Vladimir Lenin must be kicking himself (while dodging flaming pitchforks) asking “why didn’t I think of this?”

Italy turning to corporate sponsorship to save cultural and historic sites

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Those evil corporations… Via Der Spiegel:

With the country mired in debt, Italy’s cultural budget has been slashed in recent years, spelling trouble for several historic sites. Many local politicians have turned to corporate sponsorships to raise the money necessary for vital upkeep. The trend has attracted considerable criticism.

The story continues.

Zambuto is the mayor of the town of Agrigent in Sicily, and he says the archeological site there is worth €2 billion. He wants to do his part to market that potential. With local elections approaching in May, Zambuto, 39, is on the stump, and his idea of auctioning off the rights to the site, in hopes of attracting major investors from around the world, plays a central role in his campaign speeches. Only the best will be awarded the contract, he promises. The money generated by the auction, he says, will be invested in the urgently needed maintenance of the temples.

“Italy has the world’s largest heritage of cultural treasures,” says Zambuto, “but we do nothing to maintain it. It’s the government’s responsibility, of course, but if the government is broke — well, then Versace can certainly be a solution.” Or Louis Vuitton, for that matter. As long the investor isn’t a Russian oligarch like Mikhail Prokhorov, Vladimir Putin’s challenger in the presidential elections in March, who has reportedly expressed an interest in buying the Temple of Zeus — although no one knows why he wants it.

Remember ideas that start in Europe have a way of working their way here.

Can you imagine a Pepsi Mt. Rushmore Experience?

Politics is no way to run an economy

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Via Bloomberg BusinessWeek:

On Tuesday, President Obama announced he wants Congress to increase the amount of collateral that traders have to post to buy a futures contract. (It’s typically around 10 percent of the value of the total contract.) Obama also wants to give the CFTC an extra $52 million to pay closer attention to the oil market and dole out stiffer penalties to those who manipulate it: $10 million instead of the current $1 million. That assumes of course that the CFTC can find those manipulators.

Obama (and his fellow leftists) are economically illiterate. His push to further regulate commodity speculation markets for political gain will backfire, creating bigger- not smaller price swings.

Via Hoover Institute:

The concept is very simple. If speculators anticipate lower future supplies (and higher prices), they buy now and hold for future sales. If they guess right, they sell in the future at a profit. If they guess wrong, they sell in the future for a loss. The profitable speculator has moved supply from a period of relative abundance to a period of relative scarcity and has smoothed out prices. We have been made better off.

In other words, profitable speculators perform a positive service for the economy. Unprofitable speculators make things worse, but they can’t stay in business if they continue to guess wrong. They disappear. Those with a knack for speculation remain and smooth out prices and supplies.

As my favorite economics writer Tim Worstall points out, politics and economics don’t mix:

And that’s the problem with politics isn’t it, as a method of actually running anything. Lies, untruths, win in that game. And running things on the basis of lies and untruths just isn’t going to be optimal for anyone other than those who get to sit on the thrones.

Well said.

The Hoopster-In-Chief Economy

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Obama lives it up on the basketball court Easter Sunday:

The “Shoot for Strength” activity took place on the White House basketball court, where Daryll “Chocolate Thunder” Dawkins and legendary shooting guard Mitch Richmond joined Globetrotters’ Herb Lang, Fatima Maddox, Jacob Tucker and Wun Versher to conduct drills with kids. The drill consisted of the kids doing pushups every time the professional players or President Obama scored.

In his first three shots he went 0 for 3. He missed seven shots before sinking his first.

The kids switched with the shooters, and the president dropped to the ground to do some pushups.

“Somebody saw me cheating on my pushups,” the president joked.

Way to set an example Barack. It takes quite a man to cheat in a contest with kids.

While Obama cheated on the kids, the United States economy continues to decay:

1. Every fifth man in America is out of a job. Indeed, black male unemployment is now at the highest rate it has ever been since the U.S. government began collecting statistics on the subject in 1972. Just 56.9 percent of black men over the age of 20 are now working. Indeed, according to Rep. Maxine Waters (D-CA), one out of every six African Americans, male or female, are now unemployed.

2. Every seventh person you pass on the sidewalk now relies on food stamps.

3. On the last day of President Bush’s presidency, gas prices were $1.84 a gallon. Today under Obama, the average price of a gallon of gas costs $3.94. Easter weekend in Catalina Island, California, drivers saw prices topping $7 a gallon.

4. In 2006 and 2007, 90% of all college graduates found a job. Under Obama, just 56% of college graduates are able to find a job.

5. More than one in four U.S. homeowners are “under water” or owe more than their homes are worth. The housing crisis has now destroyed $7 trillion in U.S. household wealth. Another 9.5 million homes are still at risk of default, sparking what analysts believe will be a second wave of foreclosures in the months to come.

6. President Obama has increased the national debt more in three years than President Bush did in eight. Under Bush, the debt rose $4.899 trillion in eight years. In three years, Obama has exploded the debt by $4.939 trillion.

7. A record 87,897,000 Americans are no longer in the labor force. When the number of individuals who have stopped looking for a job and/or who are working part-time but desire full-time employment is included–a figure known as the “underemployment rate”–real unemployment stands at 19.1%.

The real unemployment rate is 19.1% and Obama continues to spin rather than man up:

Despite the slowdown in hiring, President Barack Obama says overall job growth has been encouraging.

“Our economy’s now created more than 4 million private sector jobs over the past two years and more than 600,000 in the past three months alone,” he said. “But it’s clear to every American that there will still be ups and downs along the way and that we’ve got a lot more work to do.”

Obama cheats on kids and lies to the American people.  What a guy.

BTW, the creepy picture on the basketballs Obama used while cheating, are reminiscent of the creepy American flags his zombies… I mean supporters… flew a few weeks ago.

Talk about a cult of personality…