Our # 1 story is an excellent look at Keynesian economics and why it isn’t working. #2 has one of Obama’s cabinet secretaries demeaning the TEA Party and using a sexual slur in referring to them. #3 tells the story of how the Russians have tried to get a spy into close connection with the Obama Administration. #4 relates how Nancy Pelosi thinks Boeing should either unionize their new plant in South Carolina or shut it down. I guess you have to be a union member to have a job in Nancy’s America. #5 shows how despite what you hear from the left, school teachers make more than their counterparts in private industry and if you include fringe benefits, a lot more. #6 shows the hypocrisy in the left. While the OWS are out protesting Wall Street, we see Fannie and Freddie executives getting millions in bonuses even after the Federal government has had to come up with hundreds of billions in bailouts. Finally in #7, we find that the British government is cutting the subsidy to solar in half and the predictions are that the industry will fold as a result.
1. Four Reasons Why Keynesians keep getting it Wrong
…FIRST, BIG INCREASES IN SPENDING AND GOVERNMENT DEFICITS RAISE THE PROSPECT OF FUTURE TAX INCREASES. Many people understand that increased spending must be paid for sooner or later. Meanwhile, President Obama makes certain that many more will reach that conclusion by continuing to demand permanent tax increases. HIS DEMANDS ARE A DETERRENT FOR THOSE WHO DO MOST OF THE SAVING AND INVESTING. Concern over future tax rates is one of the main reasons for heightened uncertainty and reduced confidence. Potential investors hold cash and wait.
SECOND, most of the government spending programs redistribute income from workers to the unemployed. This, Keynesians argue, increases the welfare of many hurt by the recession. What their models ignore, however, is THE REDUCED PRODUCTIVITY THAT FOLLOWS A SHIFT OF RESOURCES TOWARD REDISTRIBUTION and away from productive investment. Keynesian theory argues that each dollar of government spending has a larger effect on output than a dollar of tax reduction. But in reality the reverse has proven true. PERMANENT TAX REDUCTION GENERATES MORE EXPANSION THAN INCREASED GOVERNMENT SPENDING OF THE SAME DOLLARS. I believe that the resulting difference in productivity is a main reason for the difference in results….
Well worth your time to read the entire article.
2. Carrying Water for Obama, Hilda Solis Picks a Fight with the Tea Party
With the team behind President Barack Obama targeting the Sunshine State in their bid for a second term in 2012, the White House sent U.S. Labor Secretary Hilda Solis to speak to the Florida Democratic Convention on Saturday.
A day after Vice President Joe Biden told the convention at Walt Disney World that Obama needed to carry Florida to win in 2012, SOLIS ATTEMPTED TO RALLY DEMOCRATS FOR THE ELECTIONS AND URGED THEM TO PUSH FOR THE OBAMA JOBS PLAN WHICH, with Republicans controlling the U.S. House, has no chance of passing Congress.
Speaking at a luncheon event on Saturday, Solis carried water for Obama, bashing Republicans and praising the administration’s economic policies.
Solis offered harsh words about conservatives. Looking at 2012, SOLIS SLAMMED THE TEA PARTY MOVEMENT, CALLING THEM “TEABAGGERS” and promising the Obama administration will take them on.
A day after Vice President Joe Biden told the convention at Walt Disney World that Obama needed to carry Florida to win in 2012, SOLIS ATTEMPTED TO RALLY DEMOCRATS FOR THE ELECTIONS AND URGED THEM TO PUSH FOR THE OBAMA JOBS PLAN WHICH, with Republicans controlling the U.S. House, has no chance of passing Congress.
Speaking at a luncheon event on Saturday, Solis carried water for Obama, bashing Republicans and praising the administration’s economic policies.
Solis offered harsh words about conservatives. Looking at 2012, SOLIS SLAMMED THE TEA PARTY MOVEMENT, CALLING THEM “TEABAGGERS” and promising the Obama administration will take them on.
http://www.sunshinestatenews.com/story/carrying-water-barack-obama-hilda-solis-picks-fight-tea-party
These people are simply ignorant bigots. Calling TEA Partiers what she did is the equivalent of a racial slur. It’s time for Solis to resign.
3. Russian Spies come close to infiltrating Senior Obama Administration
The FBI rounded up a network of deep-cover Russian spies last year after the group came close to placing an agent near a Cabinet official in the Obama administration, a senior FBI counterspy said Monday as the bureau released once-secret documents on the case.
Frank Figliuzzi, assistant FBI director for counterintelligence, did not identify the Cabinet official, but OTHER U.S. OFFICIALS SAID IT WAS SECRETARY OF STATE HILLARY RODHAM CLINTON.
Mr. Figliuzzi said in an interview that the FBI decided to end its more than 10-year-long counterspy investigation of the network because of concerns that THE SPIES WERE “GETTING VERY CLOSE TO THEIR OBJECTIVE.”
“These 10 Russian officers were sent to the U.S. on a specific mission to get close to U.S. policymakers and leaders in our government,” he said, noting that one had developed a friendship with someone close to a Cabinet official.
Mrs. Clinton’s spokesman at the time the case broke, P.J. CROWLEY, SOUGHT TO DISTANCE HER FROM THE CASE, BUT DID NOT DENY THAT SHE WAS THE PERSON MENTIONED IN COURT PAPERS. “There is no reason to believe that the Secretary of State was a special target of this spy ring,” Mr. Crowley said in an email….
http://www.washingtontimes.com/news/2011/oct/31/fbi-says-russian-spies-got-close-to-cabinet/
The lesson here is that we need to be ever vigilant.
4. Nancy Pelosi: Government should shut down non-union manufacturing
In an interview late last week, House Minority Leaeder Nancy Pelosi (D-CA) told CNBC that BOEING SHOULD EITHER UNIONIZE ITS PRODUCTION FACILITIES IN SOUTH CAROLINA, OR SHUT THEM DOWN ENTIRELY.
“Do you think it’s right that Boeing has to close down that plant in South Carolina because it’s non union?” asked host Maria Bartiromo. Pelosi’s reply: “Yes.”
THE MINORITY LEADER QUICKLY ADDED THAT SHE WOULD RATHER IT SIMPLY UNIONIZE AND STAY OPEN. BUT BARRING UNIONIZATION, BY PELOSI’S REASONING, IT SHOULD SIMPLY SHUT DOWN…
Freedom and liberty aren’t Democratic values at least they aren’t if you believe what former Speaker of the House Nancy Pelosi said.
5. Public school teachers make more than private sector workers
We can already hear the anguished, angry protests of the National Education Association and American Federation of Teachers. But our headline captures the essence of an important new study being released today by Jason Richwine of the Heritage Foundation's Center for Data Analysis and American Enterprise Institute's Andrew Biggs. RICHWINE AND BIGGS FOUND THAT WHEN PUBLIC SCHOOL TEACHERS AND PRIVATE SECTOR WORKERS ARE COMPARED OBJECTIVELY ON THE BASIS OF COGNITIVE SKILLS -- RATHER THAN YEARS OF SERVICE OR EDUCATIONAL ATTAINMENT -- THE EDUCATORS ENJOY HIGHER COMPENSATION -- contrary to the claims of union officials in public debate and in negotiations with school boards.
This is seen most dramatically WHEN WORKERS SWITCH FROM NON-TEACHING JOBS TO TEACHING JOBS. SUCH A MOVE TYPICALLY RESULTS IN A WAGE INCREASE OF APPROXIMATELY NINE PERCENT. "TEACHERS WHO CHANGE TO NON-TEACHING JOBS, ON THE OTHER HAND, SEE THEIR WAGES DECREASE BY ROUGHLY 3 PERCENT. This is the opposite of what one would expect if teachers were underpaid," Richwine and Biggs said….
…"More generous fringe benefits for public-school teachers, including greater job security, MAKE TOTAL COMPENSATION 52 PERCENT GREATER THAN FAIR MARKET LEVELS, equivalent to more than $120 billion overcharged to taxpayers each year. Teacher compensation could therefore be reduced with only minor effects on recruitment and retention," Richwine and Biggs conclude….
http://washingtonexaminer.com/opinion/editorials/2011/10/public-school-teachers-make-more-private-sector-workers#ixzz1cSZmj9ZL
This certainly puts a hole in the underpaid, overworked meme by the NEA.
6. Crony Socialism at Work at Fannie And Freddie
The Obama administration’s efforts to fix the housing crisis may have fallen well short of helping millions of distressed mortgage holders, but THEY HAVE LED TO SEVEN-FIGURE PAYDAYS FOR SOME TOP EXECUTIVES AT TROUBLED MORTGAGE GIANTS FANNIE MAE AND FREDDIE MAC.
The FEDERAL HOUSING FINANCE AGENCY, THE GOVERNMENT REGULATOR FOR FANNIE AND FREDDIE, APPROVED $12.79 MILLION IN BONUS PAY AFTER 10 EXECUTIVES FROM THE TWO GOVERNMENT-SPONSORED CORPORATIONS LAST YEAR MET MODEST PERFORMANCE TARGETS TIED TO MODIFYING MORTGAGES IN JEOPARDY OF FORECLOSURE.
The executives got the bonuses about two years after the federally backed mortgage giants received nearly $170 billion in taxpayer bailouts — and despite pledges by FHFA, the office tasked with keeping them solvent, that it would adjust the level of CEO-level pay after critics slammed huge compensation packages paid out to former Fannie Mae CEO Franklin Raines and others.
Securities and Exchange Commission documents show that Ed Haldeman, who announced last week that he is stepping down as Freddie Mac’s CEO, received a base salary of $900,000 last year yet took home an additional $2.3 million in bonus pay. Records show other Fannie and Freddie executives got similar Wall Street-style compensation packages; Fannie Mae CEO Michael Williams, for example, got $2.37 million in performance bonuses.
This is a major scandal. The cause of most of the economic problems remains unchanged and even the compensation packages are completely out of whack with the real world. It’s time to dissolve Fannie and Freddie.
7. UK cuts Solar Subsidy
HUNDREDS OF SOLAR COMPANIES ARE LIKELY TO GO BUST BY CHRISTMAS AFTER THE DEPARTMENT FOR ENERGY AND CLIMATE CHANGE CONFIRMED IT IS LOOKING TO HALVE SUBSIDIES FOR NEW PANELS.
Greg Barker, minister for climate change, said the "feed-in tariff" subsidies are currently too generous, because the cost of installing solar panels has fallen.
The proposed cuts, due to come into force from December, will see the amount earned from each panel fall FROM 43.3P PER KILOWATT HOUR OF SOLAR POWER TO 21P. This will save energy customers around £23 a year - or £700m in total - because the subsidies are funded through electricity bills.
However, the industry warned that many home owners and companies may immediately back away from the flagship scheme because IT WOULD NOW TAKE UP TO 25 YEARS TO EARN BACK THEIR INVESTMENTS.
Gaynor Hartnell, chief executive of the Renewable Energy Association, said: "The installation rate is likely to fall drastically, and many of the 25,000 newly-employed in this industry may end up joining the dole queue."
This is the problem with green energy. It is unreliable and expensive. Without subsidies it is unworkable. So when people talk about cutting government subsidies to all energy, it’s a good idea and it means the death of solar and wind energy.
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