The Crystal Ball Is Cloudy.......But.......

Inflation is Our Future
by Puru Saxena
Hong Kong, China


On one hand, the deflationists are claiming that given the extremely high debt levels in the West, further inflation is impossible. On the other side of the argument, many proponents of inflation are calling for Zimbabwe style hyperinflation. In this business, everyone is entitled to their opinion; however it is my contention that we will get neither deflation nor hyperinflation. If my assessment is correct, once business activity picks up, our world will have to deal with high inflation.

Although I have great sympathy for the deflation crowd, given the reckless attitude of the central bankers and their ability to create debt-based money, I do not believe deflation (contraction in the supply of money and total debt) is very likely.

For sure, in this post-bubble environment, American consumer debt continues to contract, but this is being more than offset by the expansion in federal debt. Over the past year alone, federal debt in America has surged from US$9.645 trillion to US$11.813 trillion. In other words, during the past twelve months, American federal debt has risen by a shocking 24.47% and it now stands at 83.52% of GDP! Now, given the ability of the American establishment to essentially create dollars out of thin air, I have no doubt in my mind that it be able to inflate the economy. However, this will come at a huge cost and the victim will be the American currency.

In fact, the recent weakness in the US dollar is a sign that central- bank sponsored inflation has started to dominate the private-sector debt contraction in the West. Furthermore, over the past few weeks, various governments have issued US dollar-denominated debt and this suggests that the carry-trade is back in vogue. In a startling move, Germany recently announced that it plans to borrow money in US dollars!

Now, given the ongoing federal debt inflation, debasement of paper currencies, sky-high budget deficits and competitive currency devaluations, the macro-economic environment has never been better for precious metals. Yet, both gold and silver continue to frustrate the bulls by staying below the record-highs recorded in spring 2008.

So, what is going on here? Have we already seen the end of the precious metals bull-market or are we about to witness an explosive rally?
Before I attempt to answer this question, I want to make it clear that even though gold failed to better its all-time high during last autumn's panic, it was the only asset, (apart from US Treasuries) which stayed relatively firm. And looking at the various markets today, gold is the only asset that is flirting with its all-time high. So, whether you like it or not, gold deserves some credit for fulfilling its role as a safe haven.

Now, unlike some of the die-hard gold bugs, I don't believe that gold is the ultimate asset to own at all times. Without a doubt, there have been times in history when gold has proven to be a lousy investment.
For instance, between 1980 and 2001, the nominal price of the yellow metal fell by an astonishing 70%. This horrible price action spawned an entire generation who grew up hating gold and up until a few years ago, the vast majority considered gold a barbaric relic.

However, during other periods in history, when macro-economic uncertainty was high and inflationary expectations were running out of control, gold turned out to be a fantastic asset to own.

If my take on the macro-economic situation is valid, then we are in such a period now and gold must form a part of every investment portfolio.

You may remember that over the past year, central banks have injected trillions of dollars into the banking system and it is only a matter of time before inflationary expectations start spiraling out of control.
Up until now, this 'stimulus' money hasn't permeated through the economy in the West but once money velocity picks up, prices will start rising and the investment community will become very concerned about inflation. When the deflation scare abates and people start protecting the purchasing power of their savings, capital will start to flow towards precious metals.

Long-term clients and subscribers will recall that about two years ago, I highlighted gold's tendency to rocket higher every other year. Figure
1 captures this trend perfectly and you can see that since the outset, gold's bull-market has been punctuated by lengthy consolidations and the yellow metal has surged to a new high every alternate year.

Figure 1: Is gold about to shine?

http://dailyreckoning.com/files/2009/09/DRUS09-29-09-3.JPG

So, if gold remains in a bull-market and its trend consistency is intact, its price should surge over the following months. Conversely, if the price of gold fails to climb above its all-time high before year-end, it should start to ring alarm bells as this would open up the possibility that the bull-market may be over. Remember, certainty does not exist in the investment world and savvy investors should remain open to all outcomes.

Now, given the uncertainty in the world today and the ticking inflationary time-bomb, my view is that gold will soon embark on its north-bound journey. So, I suggest that investors hold on to gold and the related mining companies which will probably continue to perform well until next spring.

As far as silver is concerned, it has always been a high-beta play on the direction of gold. If the next up leg in gold's bull-market materialises, the price of silver will also head towards the heavens.
Accordingly, investors may also want to allocate a portion of their investment portfolio to silver bullion and silver producing companies.

A Generation that Doesn't Work.......At All

There Will Always Be Takers of Free Money
By Kevin Brekke
Well, Sunday was national election day in Germany (why can’t Americans vote on the weekend?), and although the results will produce a decided shift in German coalition government, they also mark the culmination of another story told by the voters that likely will go unnoticed. Bear with me here – this has relevance to an upcoming event in the U.S. Congress.
In 2002, a commission was formed to examine the German social safety net system of programs and make recommendations on how to reform them – kinda like the American Congress putting together a blue-ribbon commission for this or that study. The commission was headed by Peter Hartz, an executive at Volkswagen, and hence was known as the Hartz Commission, and the eventual legislation that was passed by parliament was named Hartz IV (there were four stages of changes phased in over a few years).
One impetus for the commission’s forming was to explore possible changes to the unemployment scheme in Germany. At the time, unemployment benefits were high, at about two-thirds of your previous wage, and lasted 18-24 months. However, there was no minimum benefit guarantee, and for those low-wage earners who lost their jobs the benefit was very small. The German government was under pressure to change the law and implement a lower benefit percentage, a “minimum livable benefit” floor, and to extend the term that benefits could be drawn. And, no surprise, the commission’s recommendations conformed to the government’s concern.
Changes were made to unemployment benefits that included a minimum monthly guarantee, a lowered monthly benefit percentage, and essentially extended the benefits to an unlimited term. Uh-oh.
Nationwide street protests took place in reaction to the lowering of the benefit amount.
Let’s now return to Sunday’s election. The party that pushed hard for the passage of the Hartz IV amendments was the SPD, the Social Democrat Party. And they have been losing voter support and political power since. The SPD’s support fell to 23% from 33% in the last national election, a phenomenal drop in a multi-party system, and they will be replaced by another, far smaller party in the ruling coalition government formed with the CDU/CSU, the biggest party in Deutschland. Voters always want smaller government, just don't touch my sacred benefit. The SPD is a fading party due to its backing of more restrictive government benefits.
And here’s a telling anecdote showing how the jobless game the system. After the last national elections, one of the TV stations was polling voters asking about their choices and their feelings about the elections. One gentleman, after sharing his thoughts, was asked by the interviewer about his personal situation, and his profession.
“I’m a Hartz IV man,” was his reply. My jaw went slack. His chosen profession was unemployed. And under the new rules, he had likely figured out how to work the system and stay on the dole for as long as the gravy flowed. A permanent underclass of long-term unemployed now exists in Germany. When governments opt to give away free money, there will always be takers.
Last week the House voted to pass a third extension in unemployment benefits, and the Senate is expected to do the same as early as this week.
Now, I’m as sensitive as the next guy to the hardship suffered when a job is lost. But the path being trodden by Congress is a dangerous one. The longer the unemployed are subsidized, the more likely it is that the “benefit” will come to be seen as an “entitlement,” and entitlements seldom come with expiration dates.
Like Social Security, the question of unemployment benefits is evolving into a parallel third-rail in politics, where neither party nor politician will touch them for fear of political suicide.
I hope that whatever decision is made by Congress, it comes with clear guidelines and a set term. I fear that neither of these is likely to be on the agenda.

Russia gives the U.S. a lesson on capitalism

You know the U.S. has lost its way when Russia begins to look like the more capitalist economy.

Putin Sounds More Welcoming Tone to Foreign Investors
By ANDREW E. KRAMER
MOSCOW — Russia's prime minister, Vladimir V. Putin, whose government took control of several oil companies when he served as president, gave a speech Tuesday saying the state must now step back from the economy and let private enterprise take the lead in pulling Russia out of recession.

The speech, at a banking forum in Moscow, echoed recent assurances by his ministers and economic advisors that Russia is becoming more attentive to the concerns of investors. Mr. Putin also reiterated their suggestions that a new round of privatizations could be in the cards for Russia.

The speech on economic policy was noteworthy for its exceptionally warm endorsement of a role for private investors. That had not been the case in recent years.

“We understand how deceptive blind faith in an omnipotent state is, how illusory are the hopes that total intervention in economic life might fix everything and put everything in its place,” Mr. Putin said.

He went on to praise private enterprise. “To the extent that the situation stabilizes, that the effects of the crisis are overcome, we plan to consistently and purposefully reduce state intervention in the economy,” he said, adding that a new round of privatizations could follow.

The government already has been extending an olive branch to the petroleum industry, offering new investments and a greater role in a sector at a meeting with oil company executives last week.

Mr. Putin noted that, while the government inevitably took stakes in Russian companies during the crisis, it did not use the downturn to impose greater controls and did not restrict the free conversion of the ruble.

“We will continue the line of encouraging private initiative, integration into the global economy and the creation of a favorable investment climate,” he said.

In his first term as president, from 2000 until 2004, Mr. Putin had introduced a number of pro-business reforms such as a flat tax and a streamlined system for registering small enterprises, but followed this in his second term with a sweeping extension of state control over the natural resources companies during the boom.

On Tuesday, Mr. Putin took a different line. Russia may eventually liberalize even the trade in natural gas, though a monopoly would remain with Gazprom for exports for at least the medium term, he said.

During the oil boom, export revenues exploded and foreign investors rushed to pile on to the economic expansion. If anything, the government struggled with the problem of too much money, sparking inflation and making local products uncompetitive with imported goods.

That reversed last autumn, and Russia is now again in a position of having to compete for limited investor money with other emerging economies.

“Now, with capital around the world much more scarce, there’s a recognition that Russia does have to play the game,” Rory MacFarquhar, an economist at Goldman Sachs’s office in Moscow, said in a telephone interview. “It does have to make overtures to foreign investors and it cannot take them for granted.”

In one sign of some stabilization in the Russian economy, the Central Bank on Tuesday lowered its refinancing rate for the second time in two weeks, indicating it is less worried now about a run on the ruble and can instead focus on trying to stimulate lending to businesses.

High Unemployment, Here to Stay....

The business cycle has more pain in store, even as unemployment grows
Charles Hugh Smith

Sep 29th 2009 at 2:00PM

As my colleague Douglas McIntyre described in "Unemployment problems are worse than meet the eye," unemployment in this recession is different -- what many are calling structural unemployment, meaning a decline in the jobs base, which is not going to bounce back quickly due to deep structural problems in the U.S. economy.Having been unemployed in the last three major recessions -- 1974, 1981 and 1991 -- I have experienced the gamut of wrenching emotions first-hand and know how those running low on money and hope feel. The deepest downturns since the Great Depression, the 1974-75 and 1981-83 recessions caused widespread unemployment and misery. In the '70s, the problem was stagflation, a combination of tepid growth and rising inflation which eventually required a direct frontal attack on inflation by President Reagan and Federal Reserve Chairman Paul Volker, who jacked up interest rates to 16 percent. This tightening of credit slayed the inflation monster but at the cost of millions of jobs.
That hard-won victory over 10+ percent annual inflation enabled the great 25-year bull market and a massive expansion in employment.In contrast, the early-'90s recession ended when the PC/Internet boom ignited a major expansion of enterprise and jobs -- what economists call "organic growth" as opposed to a government-funded spurt.The typical business cycle is one of expansion of business and credit to the point of over-capacity and general giddiness, at which point risks are downplayed and leverage reaches a peak.Inevitably, risky bets fail, bad debt is written off and business and consumers retrench, saving money which can then be invested in the next expansion.We all know what happened in 2001: fearing a deep recession, Federal Reserve Chairman Alan Greenspan lowered interest rates and flooded the financial sector with liquidity. That cheap, abundant credit launched a boom in asset prices, most notably housing, which reached bubble proportions around the globe.In the general giddiness of the boom, American households extracted $5 trillion from home equity and indebted themselves to unprecedented levels.

Bubbles inevitably lead to over-capacity and over-leverage, and the deflation of the global financial bubble took household wealth, sales and profits down with it.Now the Federal Reserve, the Treasury and the Federal Government are attempting to reflate the economy with essentially the same formula which appeared to work in 2001: super-low interest rates, stupendous expansion of liquidity ("quantitative easing") and massive Federal stimulus spending -- the Keynesian model of recession-fighting.On top of this unprecedented "pump-priming," the government has funded or guaranteed financial-sector bailouts to the tune of $11 trillion -- three times the entire cost of World War II. (Adjusted for inflation, the U.S. spent about $4 trillion fighting a two-front global war.)Unfortunately, the economy is now staggering beneath a debt load which is roughly four times the level of the 1970s and '80s. Total debt (government, corporate and household) now exceeds 375 percent of GDP, compared to a postwar average of about 100 percent.Households are over-indebted, and are only starting the long process of paying down high debt loads to historic averages. And they are doing so against strong headwinds: their assets have plummeted by about a quarter ($12 trillion) and the equity in their homes has fallen to levels not seen since the 1974 recession. Millions have lost their jobs and millions more have seen their hours or salaries cut. The numbers are unimaginable. According to the Bureau of labor Statistics' August 2009 Employment Situation Report,14.9 million people are unemployed, 9.1 million are "working part time for economic reasons," and 2.3 million are "marginally attached to the labor force," that is, they want a job but have not actively sought one in the past four weeks.That totals 26.3 million people unemployed or under-employed. (For context, civilian employment in 2008 stood at 137 million.)Even this horrendous number probably understates the loss of household income, as the Bureau's "household survey" counts self-employed people such as real estate agents, free-lance designers and business consultants as employed, even though their incomes may have fallen dramatically or even to zero.The hope is that the $787 billion in Federal stimulus funds being spread over the land will "prime the pump" of organic growth -- that is, spark a new business cycle of expanding credit, spending, profits and confidence. But can an organic (non-government funded) expansion take root when debt levels are extraordinarily high in every level of the economy? To say "yes" is to fail to understand that the business cycle must move through renunciation of bad debt and the accumulation of real savings before an organic business expansion can begin.Can a decade of excessive capacity, leverage, risk-taking and financial fraud be wiped clean in a year? By bailing out financial institutions and pumping stimulus funding around the nation, the government is attempting to bypass the pain delivered by the organic business cycle. But in so doing, it is simply piling up more deadwood for the next financial forest fire.

A Letter From The SOUND OF CANNONS Editor.

A non-political post from your dead-tired editor. Yeah, SOC has been sputtering as of late. Family and work obligations have peaked and I'm sadly "down-for-the-count" most days and nights. Raising a family in these trying times while maintaining a "please let me keep my job" presence at work can be exhausting. And my kids! Whoa................too much to think of there! My daughter is simply growing up too fast and I really hate missing any free time I can spend with her. My son is growing up in his toddler stage and will most certainly beat up your kids on the school bus one day. The wife is maintaining her job at a high degree of importance. If I get canned from my job, she'll be supporting the whole family.............thoughts like that don't make for sound sleep at night. But you have to think like that and be wary to a certain point. And thinking like that can add to exhaustion and help your blog sputter and slow-down.

I recharged September 27th in Boston by going to see PORCUPINE TREE in concert. What a show! I've been following them since their "Stupid Dream" album and have seen them change and grow musically since the early 2000's. Steve Wilson is a musical genius and way too smart to be pigeon-holed by mass appeal. The "TREE" are mostly progressive, melancholy rock that defy genre; and their stage shows are multi-media events that I daresay no one else is coming close to. Live music always lifts me up, and this was no exception. It'd been awhile since I've been to a concert so this one was extra special.

That all being said......I'll try and keep the fires burning as we're under assault for our very lifestyles. An assault on which I don't think we'll pull through. But we'll document a good part of the folly and maybe future generations will look back and learn something from us.

Alex Jones G20 protesters under Sonic WEAPON ATTACKS Sep 24/09 Last hr 4 - 5

Oy! This is getting bad. This story was so under-reported it is criminal. We are in a Socialist state.

Ron Paul, CNN "American Morning," 9/14/09

"All the perplexities, confusion and distresses in America arise not from defects in the constitution or confederation, nor from want of honor or virtue, as much from downright ignorance of the nature of coin, credit, and circulation."

—John Adams

Ben say's Everythings OK! Whew!

Of this, our friend Nassim Nicholas Taleb is sure: “Ben Bernanke saved nothing!” Taleb writes, “He shouldn't be allowed in Washington. He's like a doctor who misses the metastatic tumor and says the patient is doing very well. The first thing I would tell Chinese officials is how can you buy U.S. bonds as long as Larry Summers is there [as head of the National Economic Council]? He's a textbook case of overconfidence. Look what happened to Harvard's finances [when he ran the university]. They took a lot of risk they didn't understand, and it was a disaster. That's the Larry Summers mentality. “Today, we still have the same amount of debt, but it belongs to governments. Normally, debt would get destroyed and turn to air. Debt is a mistake between lender and borrower, and both should suffer. But the government is socializing all these losses by transforming them into liabilities for your children and grandchildren and great-grandchildren.”

One Last One For Ol'Ted "Drinky-McDrunk" Kennedy

Ted Kennedy's Immigration Legacy -- and why did he do it?

Wednesday, September 2, 2009, 10:22 AM EDT

It's pretty apparent Terd kennedy pursued immigration policies destined to destroy the America his father tried destroying with illegal activities. Apples don't fall far from the tree.

Many Americans saw his immigration policies as emblematic of a Kennedy inclination to destroy the America as they loved it. The second group saw his immigration policies as an aberration that fatally undermined what they saw as many wonderful Kennedy initiatives to improve America.
Whichever it was -- or something in between -- Ted Kennedy's immigration policies have destroyed the ability of the United States to be an environmentally sustainable nation in any decade soon because of the gigantic U.S. population growth that he has forced.
And Ted Kennedy's immigration policies have knocked hundreds of thousands of Americans out of the middle class as their occupations have collapsed and wages declined because of inundation with Kennedy's favored foreign workers, or because they have directly lost their jobs to foreign competitors.
HE WAS AN EXCEPTIONALLY SKILLFUL OPPONENT
For those of us desiring the traditional lower numerical immigration that, ironically, Pres. John Kennedy had advocated in his A Nation of Immigrants book, it was our great misfortune that the person leading our opponents in pursuing ever-higher numbers these last 45 years was perhaps the most skillful Senator of the last half-century in getting things done his way.
Ted Kennedy surely was one of the most influential Senators in our history.
His influence on immigration alone brought more change to America than the work of any other Senator during my lifetime.
Just as a reminder, let's make a short list of the immigration policies that Kennedy and his extremely talented staff put into effect:
The 1965 revamp of the entire immigration system. It ended 40 years of low immigration, got rid of solid numerical caps and opened up chain migration into every overpopulated country in the world, exploding annual immigration numbers.
Massive expansion of the refugee programs in the late 1970s, opening up massive loopholes and encouraging a domestic resettlement industry that became a major lobby for more and more overall immigration.
The 1986 blanket amnesty. Kennedy's skills may have been best seen here where he got legislators on our side to agree to the amnesty in exchange for enforcement rules that he made sure were written in a way that would not work. Within a decade, he would be using the inability to enforce the 1986 rules as an excuse for why we needed more green cards and more amnesties. An example of Kennedy's great skill was that he persuaded Ronald Reagan to enthusiastically support this bill.
The 1990 immigration act, which increased overall immigration by another 35%. The first Pres. Bush was Kennedy's co-partner, just as the second Pres. Bush was Kennedy's eager co-partner in trying to force through another blanket amnesty 2001-2008.
The 1990 act also established the lottery whereby we randomly give away 50,000 green cards a year to people in countries picked because they have the least ties and cultural association with the United States, and which disproportionately are terrorist-sponsoring countries. This was something of a compromise for Kennedy who was able to ensure that during the first few years, much of the lottery winners would be illegal aliens from Ireland -- his own ethnic group.
The H-1B visas which have enabled corporations to keep hundreds of thousands of American kids from getting a foothold in the high tech industry.
The total defeat of liberal civil rights champion Barbara Jordan's blue-ribbon commission recommendations to reduce overall immigration and eliminate chain migration and the lottery in 1996.
Six mini-amnesties that passed in the 1990s, primarily aimed at specific nationalities.

KENNEDY UNDERMINED WHAT HE SAID WERE HIS HIGHEST PRINCIPLES
At the graveside service in Arlington National Cemetery, we learned what Ted Kennedy wanted the Pope to know about the principles that drove him. Retired Cardinal McCarrick read from an appeal to the pope for a final blessing, written we presume by Kennedy in his last weeks:
I know that I have been an imperfect human being, but with the help of my faith, I have tried to right my path. I want you to know, Your Holiness, that in my nearly 50 years of elective office, I have done my best to champion the rights of the poor and open doors of economic opportunity. I've worked to welcome the immigrant, fight discrimination and expand access to health care and education. . . .
This was a typical comment among the thousands who honored Ted Kennedy this last week:
Senator Kennedy helped change the character of the immigration system, and indeed the country, bringing the United States a step closer to its founding ideals of fairness and opportunity for all.
-- Former Immigration and Naturalization Service commissioner Doris Meisner
Hmmm, what ideals of fairness did Meisner have in mind? Does she think it was fair to drive all those American drywallers out of their jobs? How about all the American meat packer workers who lost their jobs and incomes to Kennedy's army of immigrant workers? Of course, Meisner was the chief of enforcing immigration laws that she thought were unfair and out of step with our nation's ideals. She and Kennedy fundamentally believed that our laws limiting immigration are evil or unjust.
But NumbersUSA's website is full of page after page of information showing that Kennedy's immigration policies have in fact undermined the ability of the poor to find good-paying jobs and to get on the ladder of opportunity.
The policies have undermined the fight against discrimination by making it easy for businesses to ignore poor American Black job applicants in favor of high-motivated immigrant workers. The plight of the Black underclass seems as intractable today as during the 1960s.
Kennedy's policies have driven scores of urban school districts backwards through over-crowding and through overwhelming already precarious schools with masses of non-English-speaking students from impoverished homes.
Ted Kennedy's immigration policies aren't even good for the immigrants who already are here. There is little opportunity in this nation today for millions of immigrants who must constantly compete with the next decade's millions upon millions of new foreign workers.
WHY DID KENNEDY UNDERMINE HIS OWN DREAMS OF OPPORTUNITY, EQUALITY, EDUCATION
Among less-immigration advocates, a debate has long waged over whether the gigantic changes from immigration were what Kennedy sought, or if they were mostly an unintended consequence that he chose to ignore.
Why was he willing to allow his immigration policies to diminish -- and in some cases -- negate his efforts in other areas?
Among those who disliked Kennedy the most, there has been a sense that Ted Kennedy fundamentally distrusted and disliked the citizens of this country. The line of thinking is something like this: Even though the majority of these citizens had elected his brother President, and appeared likely to elect another brother to the office, Ted Kennedy wanted a different citizenry. Perhaps there was a sub-conscious hatred for the overall American people because of the assassinations (although one assassin was a foreigner and the other had tried to emigrate to the Soviet Union). Perhaps he had some Irish immigrant chips on his shoulder about WASPS disrespecting his family. If he disliked the balance of power among the citizens of this country, wildly increasing immigration levels could largely shift the balance of political power and ideology in the country.
To whatever extent any of that was true, Kennedy's immigration policies certainly "elected a new citizenry." This country now has more than 50 million natives of other countries and their children. In a country of 300 million, that is an incredible influence on every aspect of our political and social and economic lives, don't you think.
Most of those 50 million are here as a result of the policies Kennedy put in place.
Among people with a softer and perhaps more human view, Kennedy simply paid no attention to the consequences of his immigration policies. This line of thinking is something like this: Even if he had paid attention to the consequences, his commitment to high immigration was so great, there was no way he could have pulled back.
Back in Boston last week, I gave my dinner companion those two big choices. Even though he is 100% against Kennedy's immigration policies and largely in opposition to other Kennedy positions, this acquaintance since childhood of Ted Kennedy and his family told me he cannot believe the Senator had a grand plan to radically change America.
"He's not smart enough for that," the acquaintance said. "But he has such a big heart." Kennedy's romanticism, sentimentalism and idealism were such that once he began to receive accolades from certain communities for his work on immigration, there was just no way he was ever going to stop, the acquaintance said.
He also said that he believes that, despite all the liberal veneer, Kennedy was deeply beholden to the country's banking titans and other globalist business entities who have so much interest in the free flow of international labor and in keeping the wages of Americans stagnant. (This was given credibility later when Kennedy was lauded for the great work he did to help the high-tech industry of Massachusetts to hire foreign computer programmers.)
I really don't know why Ted Kennedy did what he did on immigration. If his acquaintance is correct, it perhaps serves as a major warning to us about how to deal with all the national religious leaders, as well as our opponents in Congress, who probably really want to believe that pushing higher and higher immigration is truly God's will -- and who will never look at the practical consequences and the millions of American victims strewn across the American landscape like little memorials to idealism disconnected from concern about practical consequences.

How Would You Respond to An Obama Wealth Tax?

Pretend, just for a moment, that you're President Obama.
You have big spending plans – national health insurance, two wars, and a trillion dollar bailout for your friends on Wall Street. Not to mention paying for the soaring costs of Social Security and Medicare.
Unfortunately, revenues simply aren't keeping up.
Your Treasury Secretary – accused tax-evader Timothy Geithner – tells you that the unfolding recession is starving the country’s government for tax revenue. Indeed, just as you unveiled your trillion-dollar national health plan, Tricky Timmy informed you that federal tax revenues were dropping the fastest since 1932 – at the height of the Great Depression.
What to do…cut spending? Well, Obama did challenge his cabinet in April to come up with a whopping US$100 million in budget cuts. That's out of an estimated 2009 budget deficit exceeding US$1 trillion, perhaps more. To put that in perspective, Harvard economics Professor Greg Mankiw commented:
"…[I]magine that the head of a household with annual spending of $100,000 called everyone in the family together to deal with a $34,000 budget shortfall. How much would he or she announce that spending had to be cut? By $3 over the course of the year–approximately the cost of one latte at Starbucks. The other $33,997? We can put that on the family credit card and worry about it next year.”
But seriously, what could Obama do to make a significant reduction in the deficit? Obviously, it won't be to cut spending. Instead, Obama needs to raise hundreds of billions in additional revenues. And he needs to do it very quickly…
Suppose Tricky Timmy suggests that higher income taxes on rich folks that make over US$250,000 annually may raise a hundred billion dollars or so annually…but at the expense of depressing consumer spending by about the only segment of the population that can afford to spend.
With wealth tax systems already in place in countries like France and Norway, it might seem a reasonable conclusion to an administration aiming to drastically expand entitlements (like healthcare) in an age of plummeting tax revenues.
Well, here's an idea that Obama and Tricky Timmy might be considering, although I must emphasize that nothing official along these lines has yet been proposed: a tax, small at first, but potentially growing, on everything you own, anywhere in the world. A "wealth tax."
And when I say "everything," I mean everything:
The equity in your home
Your equity in any other real estate you own, anywhere in the world
The value of any business you own
The value of your retirement plan
The cash value of your life insurance policies
The value of your securities portfolio
The value of any assets held for you in trust
Indeed, with a wealth tax, you'll need to declare the value of those gold coins buried in your basement, the cash under the mattress, and of course, previously non-reportable offshore investments.
From Obama's perspective, a wealth tax would have two powerful advantages:
It would generate considerable revenue on its own, although perhaps not as much as Obama and Terrible Timmy would like. For instance, the French "solidarity tax" on wealth – perhaps the world's most severe wealth tax – raises only the equivalent of US$2.5 billion annually. The U.S. economy is five or six times larger than France's so Obama might get his hands on an additional US$15 billion or so if he imposed a comparable tax. That's still only a little more than 1% of the projected 2010 budget deficit, but it's a lot more than Obama's US$100 million challenge to his cabinet.
More importantly, a wealth tax would make it illegal to hide wealth in any form from the government. And Congress can increase the tab anytime it wants.
Of course, the natural reaction of many wealthy people to a wealth tax will be to move their wealth – and perhaps themselves as well – out of the United States.
That’s exactly what's happened in France, from which thousands of wealthy tax exiles have fled. And this may be the real reason for the government's greatly increased interest in any assets you hold offshore: to flush out assets for the future imposition of wealth tax.
The possibility of a wealth tax is just another reason why if you're a U.S. citizen or long-term U.S. resident with substantial assets, you need to consider the admittedly radical step of expatriating from the United States. This means acquiring a second nationality and passport, and then subsequently giving up your U.S. citizenship and passport or U.S. green card status. You also need to live outside the United States.

Climate Bill? Climate Bunk!

Coal CEO blasts climate bill

HOLDEN, W.Va.
The chief executive of coal mining giant Massey Energy blasted supporters of climate-change legislation and other environmental issues affecting the coal industry at a free Labor Day concert and rally in southern West Virginia.
CEO Don Blankenship said he wanted to show people at the event how government regulation is hurting the coal industry, driving up energy prices and making the country less competitive.
"We're hopeful that through networking that they will educate their neighbors and that they'll all begin to speak out," Mr. Blankenship said. "We think that will make a difference."
Richmond-based Massey, which operates mines in West Virginia, Kentucky and Virginia, is the lead sponsor of the rally, which Mr. Blankenship said cost about $1 million to stage.
Organizers had predicted the event, headlined by country star Hank Williams Jr., could draw as many as 100,000 people to a reclaimed Logan County strip mine. The morning crowd appeared to be smaller than that.
Headlining the event were Fox News personality Sean Hannity and Mr. Williams, while rocker Ted Nugent served as master of ceremonies and played briefly.
"Today's the day when the American worker takes back this country," Mr. Nugent said.
Some came to support coal mining, while others were more interested in the music.
"This is like the backbone of this area, I mean, whether you're a miner or not," said Joe Walters, an electrician who drove an hour from Kentucky.
Miner Dennis Blankenship, no relation to Don Blankenship, drove from southwestern Virginia to show support for mining.
"The industry is being attacked by the Obama administration," said Dennis Blankenship. "We don't mine coal, we don't live."
Walter Neal, of Hurricane, W.Va., came toting signs opposing climate-change legislation because, he said, it would increase energy prices and force more U.S. jobs overseas.
"It's cap-and-tax," Mr. Neal said, ridiculing the legislation, commonly referred to as cap-and-trade. "What concerns us is China and India further gaining the advantage."
Others were less politically motivated.
Chapmanville resident Roger Dalton said he came mostly for the music. So, too, did Jason Bolling.
"More or less for the coal miners, plus the show," said Mr. Bolling, who works at a Massey mine in eastern Kentucky.
For Massey, however, the event was an opportunity for Mr. Blankenship to highlight what he calls attacks on American workers.
"Let's send the message to Washington that the politicians have to stop giving our jobs away. If they don't, it's the politicians that need to retrain and relocate," he said.
"We don't need a government that wants to shut down our coal mines. We don't want a government that wants to increase our power bills. ... We don't want a government that is run by people who believe they can change the Earth's temperature when they can't balance a budget."

Y'Think This Might Be By Design?

The Great 'Mancession': Recession's big layoffs have hit men harder than women

Palm Beach Post-Cox News Service
Monday, September 07, 2009
AUSTIN, Texas — On a recent night, Dewey Overholser executed an ambitious dinner plan for his family: his mother's carne guisada recipe with homemade flour tortillas.
During Overholser's 25-year tenure at Advanced Micro Devices Inc., he hardly had time to play with dinner menus on a regular basis. But now, it's different.

Dewey Overholser lost his job in January in the midst of a downturn that some have dubbed the 'mancession' because layoffs have disproportionately hit men.

Dewey Overholser prepares the evening meal for his wife Elizabeth and their son Kevin, 12. Tonight's fare is carne guisada, something Dewey's mother used to prepare when he was growing up in Laredo.

In January, Overholser lost his job in the midst of a downturn that some have dubbed the "mancession" because layoffs have disproportionately hit men.
"It's great for now," Overholser, 54, said of his new duties handling the cooking, cleaning and laundry for the family, while his wife, Elizabeth, works as a teacher. "But I don't have any plans of staying home forever."
With massive job cuts in fields traditionally dominated by men, from engineering to manufacturing, more women are facing a new role as the sole family breadwinner.
The shift has upended household routines and threatened financial stability for many families, especially if they relied on the husband's job for health insurance and other benefits.
In July, the unemployment rate for men was 10.5 percent, compared with 8.1 percent for women, according to the U.S. Bureau of Labor Statistics. In May, the gap was 2.5 percentage points, the highest since the government began tracking such figures after World War II.
From the start of the recession in December 2007 through this past March, 79 percent of the jobs lost were held by men, while 21 percent were held by women, said Mark Perry, an economics professor at the University of Michigan-Flint.
But the better job security for women is offset by the fact that their jobs are concentrated in lower-paying sectors. In the second quarter, the weekly median paycheck for women was 80 percent of what men made.
Although local data on unemployment by gender isn't available, signs of the trend are visible in Austin as well.
"A lot of jobs have been lost here in manufacturing and construction," said Beverly Kerr, vice president of research for the Greater Austin Chamber of Commerce. Meanwhile, jobs in "education and health care are up."
In Kerrville, Texas, Barbara Hofmann has returned to the work force after a 15-year hiatus. She left her job as a public utility worker in the early 1990s to focus on raising her three sons, with one now in high school and two in college, while husband Paul worked in city management for a variety of municipalities.
Last year, Paul Hofmann, 50, was suddenly cut from his job as Kerrville city manager under a new City Council.
The Hofmanns didn't want to leave the area. Their youngest son, Timothy, then 15, was visibly upset when he learned that his father had lost his job.
"Tears welled up in his eyes," said Barbara Hofmann, 48. "We were just determined to figure out how we would not have to move."
The Hofmanns were lucky: Within a few months, she landed a job as a public affairs representative for the Lower Colorado River Authority.
Paul Hofmann has since picked up some consulting work, but now it's Barbara's paycheck that mostly covers the family's bills and her job that provides health insurance.
Barbara Hofmann had expected to go back to work one day, perhaps when all her sons were in college.
"It happened sooner than I had planned," Hofmann said. But "I love my job. I love the people I work with. This job couldn't be a better fit for me and my family. It provides a comfort and security level that at least we knew that we could stay here."
Other families are not so lucky.
Kathy Lansford-Powell, president of the nonprofit Launch Pad Job Club, the largest networking and job-lead group in Austin, says layoffs take a heavy toll when a family's primary income earner loses his job.
"It's not quite as difficult if you have a spouse making as much income" as their partner, she said. "But when the primary income is slashed, it causes all kinds of problems. Anytime you deal with that much income loss, it's very difficult."

You Know, Sound Of Cannons Has Always LOVED Rick Santelli of CNBC!

Still Bitter: White House Goes After Santelli Again, but Santelli Fires Back

It's been nearly seven months since CNBC reporter Rick Santelli took a stand against the Obama administration, which inspired the tea party movement - and the White House hasn't forgotten.
White House Press Secretary Robert Gibbs was asked by CNBC Washington correspondent John Harwood why the administration decided to go after Santelli after his Feb. 19 call for a metaphorical revolt over President Barack Obama's economic policies.
"Truthfully, one primary reason," Gibbs said in comments aired on CNBC's Sept. 4 "Squawk on the Street." "And that was - I thought the argument that he was making was both disingenuous and not based on the facts. It was clear that Rick was very passionate about the issue. And look, we have differing opinions from both sides of the political aisle. It was clear to me that the argument that he was making wasn't based on him having actually read our plan."

Gibbs had previously invited Santelli to the White House for coffee to discuss the plan, but Gibbs said the Secret Service probably wouldn't have allowed Santelli now.
"You know what, almost seven months have passed since Feb. 19 and a couple of things," Santelli said in response to Gibbs comments on CNBC's Sept. 4 "Power Lunch." "You know what - I will come if they invite me for a cup of coffee. I was a little surprised that he said the Secret Service wouldn't allow it. I don't understand that."
However, Santelli also explained Gibbs himself wasn't grounded in the facts, which he accused Santelli of not being. Santelli told viewers he had read Obama's so-called housing plan. But the Chicago Mercantile Exchange floor reporter said that regardless of Gibbs' disposition on Santelli's remarks, the fact that a movement was inspired was something praiseworthy.
"But there's two points that I want to clarify," Santelli continued. "He once again continues, Mr. Gibbs, to say that I was disingenuous and didn't read the home modification plan. Just for the record, not that it really matters - I did. But what's even more important is the part of the conversation with John Harwood and Mr. Gibbs that was missing and that is something magical and uniquely American happened on the 19th and 20th of February."
Although many of the lefty media outlets had gone out of their way to disparage what his remarks inspired, Santelli said he was still glad people were taking up the cause, as he did on Tea Party Day, April 15.
"The American people want to be heard," Santelli said. "And unlike many countries, if you don't agree with your government, it's OK in this country - to get together, to have tea parties, to have bus rides of tea parties and to challenge in town hall meetings."
He added that was one of the more redeeming outcomes of his remarks, regardless whether the White House approved or not.
"I think we should all be proud that we are living in a country where we can question those we put in power because at the end of the day they work for every citizen," Santelli said. "And I think that is a great aspect that came out and I think that it needed to be said."

UN wants new global currency to replace dollar

Socialist One-World Government Dogma Remains Steadfast
The dollar should be replaced with a global currency, the United Nations has said, proposing the biggest overhaul of the world's monetary system since the Second World War.

In a radical report, the UN Conference on Trade and Development (UNCTAD) has said the system of currencies and capital rules which binds the world economy is not working properly, and was largely responsible for the financial and economic crises.
It added that the present system, under which the dollar acts as the world's reserve currency , should be subject to a wholesale reconsideration.

Although a number of countries, including China and Russia, have suggested replacing the dollar as the world's reserve currency, the UNCTAD report is the first time a major multinational institution has posited such a suggestion.
In essence, the report calls for a new Bretton Woods-style system of managed international exchange rates, meaning central banks would be forced to intervene and either support or push down their currencies depending on how the rest of the world economy is behaving.
The proposals would also imply that surplus nations such as China and Germany should stimulate their economies further in order to cut their own imbalances, rather than, as in the present system, deficit nations such as the UK and US having to take the main burden of readjustment.
"Replacing the dollar with an artificial currency would solve some of the problems related to the potential of countries running large deficits and would help stability," said Detlef Kotte, one of the report's authors. "But you will also need a system of managed exchange rates. Countries should keep real exchange rates [adjusted for inflation] stable. Central banks would have to intervene and if not they would have to be told to do so by a multilateral institution such as the International Monetary Fund."
The proposals, included in UNCTAD's annual Trade and Development Report , amount to the most radical suggestions for redesigning the global monetary system.
Although many economists have pointed out that the economic crisis owed more to the malfunctioning of the post-Bretton Woods system, until now no major institution, including the G20 , has come up with an alternative.

Obama support among whites in 'free fall'

Obama is fast losing white voters' support
His approval ratings with the crucial bloc have plunged since April. Strategists say the healthcare debate is largely to blame, but that's not the only reason.
By Peter Wallsten
September 7, 2009
Reporting from Washington

After a summer of healthcare battles and sliding approval ratings for President Obama, the White House is facing a troubling new trend: The voters losing faith in the president are the ones he had worked hardest to attract.New surveys show steep declines in Obama's approval ratings among whites -- including Democrats and independents -- who were crucial elements of the diverse coalition that helped elect the country's first black president.Among white Democrats, Obama’s job approval rating has dropped 11 points since his 100-days mark in April, according to surveys by the Pew Research Center for the People and the Press. It has dropped by 9 points among white independents and whites over 50, and by 12 points among white women -- all groups that will be targeted by both parties in next year's midterm elections."While Obama has a lock on African Americans, his support among white voters seems to be almost in a free fall," said veteran Republican pollster Neil Newhouse.Strategists in both parties blame Obama's decline on growing discontent with his policy agenda, particularly after a month of often-rowdy debate over his proposed healthcare overhaul, in which some conservatives accused him of socialism. Obama's ratings seem likely to rise again if he wins passage of healthcare legislation this fall.But the drop in support among whites also comes as some conservatives have stoked controversies that have the potential to further erode Obama's standing among centrists -- including some controversies that resulted from White House stumbles.One such episode came to a head Sunday when Van Jones, Obama’s green jobs czar, resigned after a week of criticism over past inflammatory statements and for signing onto conspiracy theories questioning whether the U.S. government played a role in the Sept. 11 attacks. A White House official acknowledged Sunday that Jones had been vetted less rigorously than other officials.In another episode, some conservatives have criticized a White House dinner invitation issued to the lead lawyer in the American Civil Liberties Union lawsuits that have forced the government to disclose Bush-era interrogation techniques. The lawyer was invited to an event for the Muslim holiday of Ramadan.And Obama's plan to address the nation's schoolchildren Tuesday has prompted an outcry among some conservative parents and GOP officials. Some of them have accused the White House of trying to infuse "socialism" into the minds of young people.These controversies have followed conspiracy theories that the president was born overseas and is ineligible to hold office, and that his true religion is Islam -- false rumors that some Democrats worry could be affecting the public's view of the president and his party.Pew first identified a slippage in white support immediately after a news conference in July, when Obama surprised many by saying that a white police officer had acted "stupidly" in arresting a black Harvard professor.Still unclear is whether Obama's slide in the polls is due solely to his policies, or questions about his personal background or allegiances.During the presidential campaign last fall, the nation's economic meltdown swamped any attempts by Republicans to portray Obama as having radical associations with figures such as his former pastor, the Rev. Jeremiah A. Wright Jr.Some conservatives, such as Fox's Glenn Beck and Sean Hannity, have argued that Jones, an outspoken Bay Area black activist who once described himself as a communist, fit the same pattern.One black congressman, Rep. Charles B. Rangel (D-N.Y.), was quoted last week alleging that opposition to Obama's healthcare policies was "a bias, a prejudice, an emotional feeling.""Some Americans have not gotten over the fact that Obama is president of the United States. They go to sleep wondering, 'How did this happen?' " Rangel said, according to the New York Post.Democratic pollster David Beattie conducted a survey last month in one competitive congressional district that found that more than a quarter of independents believed Obama had not proven his natural-born status. The same sentiment was expressed by nearly 6 in 10 Republican women -- a group that Beattie said would be important for a Democratic victory.He declined to name the district because the polling was private, but said that such questions about Obama's background seemed to be a "proxy" for voters' growing unease with Obama's ambitious agenda, which has included a potential push to create a government-sponsored health insurance plan.Surveys show that the vast majority of Americans like Obama personally, but that they are increasingly skeptical of policies that seem to expand the scope of government."We're having an economic culture war," Beattie said."The criticisms of Obama are about the fundamental role of government in our economy."A new analysis by the nonpartisan Cook Political Report concludes that nervousness about the president could prove devastating for Democrats next year.The analysis, with a headline asking if 2010 could be the "year of the angry white senior," warns that Obama faces a growing "gulf" between his still-strong support among young people and his dwindling numbers among people 65 and older.The result, according to analyst David Wasserman, could be a loss by Democrats of up to 25 House seats. Democrats currently hold a 78-seat majority in the House.Obama won a narrow majority of independents in last year's election, and the Pew numbers show that his approval rating among that group rose to 57% in April -- including half of white independents -- before declining to 48% most recently.More than half of whites older than 50 approved of Obama's job performance in April. But now, after weeks of Republican accusations that the Democrats would seek to cut Medicare benefits, that number is 43%. Among white Democrats, Obama's approval rating dropped to 78%, from 89%.Some Democrats are hopeful that Republican opposition to Obama may be firing up core conservatives but failing to win over even skeptical centrists and independents to the GOP cause.Dan Parker, Democratic Party chairman in Indiana, home to three competitive congressional districts and an upset win last year by Obama, said that the Republicans have yet to field strong challengers in those House races this year.And, he added, in a state hit hard by economic troubles, voters are willing to give Obama credit for his economic stimulus package and for bailing out the auto industry."Once he gets the credit for passing healthcare reform, then he'll see the political benefit," Parker said.But the conservative rebellion against Obama has even hit Parker close to home. Last week, he received an e-mail from the principal at his children's school with the news that Obama's Tuesday back-to-school address would not be shown to most students, due to complaints from parents.

Ol'Ted Left Us With A Lot.................

William Shakespeare said: "The evil that men do lives after them...."

Ordinarily we wouldn't speak ill of the dead. But Shakespeare's words ring all too true because the Left is shamelessly trying to exploit Senator Ted Kennedy's death in an attempt to ram Obamacare down the throats of the American people. And as patriotic Americans, we cannot let that happen. Remember one thing, all the sentimental tributes you're hearing on radio and television - the blubbering eulogies, the syrupy clichés, the sickening lies - don't alter the hard fact that Ted Kennedy probably did more than any political figure of his generation to weaken and corrupt America. Someone has to remind them who Edward Moore Kennedy really was. Otherwise, a bunch of blind Democratic ideologues and weak-minded, sentimental Republicans will pass a so-called healthcare bill that will transform our great nation into a sick, socialist country. Political commentator Don Feder agrees. Feder - who lives in Massachusetts - wrote that he wished for a barf bag while driving around the city, listening to the fulsome tributes on local radio. As Feder put it:"Known as the 'liberal lion of the Senate,' Edward M. Kennedy was a fitting symbol for his creed - intellectually flabby, detached from reality, arrogant, self-righteous, hypocritical and, ultimately, useless." Are we doomed to listen to these sick encomiums for the rest of the summer and then watch a spooked Congress pass

Here are some highlights from that exemplary life we're asked to celebrate.

As a boy, Kennedy went to ten different prep schools before graduating from the last one.

As a freshman at Harvard, he cheated on a Spanish exam, got caught, and was kicked out of school.

He entered the Army during the Korean War, but his rich and powerful daddy arranged for him to spend his service time at NATO, while sons from ordinary families came back from Korea in body bags.

He effectively inherited his Senate seat from his brother Jack and settled in for 47 fun-filled years, despite numerous scandals that would have ruined his 99 colleagues. The greatest of these was Chappaquiddick, which Feder describes as follows: "It was a typical Kennedy bash on Chappaquiddick Island the evening of July 19, 1969 - mostly married men, six single women and copious quantities of social lubricants. "It took [Kennedy]10 hours to tell police that he'd left Mary Jo Kopechne in a submerged vehicle, while he huddled with advisors to smooth the rough edges of his story and get the alcohol out of his bloodstream. "In a plea for sympathy, Kennedy described his actions that evening as indefensible." "They were also cowardly and criminally negligent. A diver said that there was an air bubble in the back seat. Mary Jo, who died 40 years and 5 weeks ago, could have lived if she'd been reached in the first hour? Kennedy was charged only with leaving the scene of an accident. He was tried behind closed doors, given a suspended sentence. You see what I mean by "corrupt." Imagine what would have happened to a drunken Jesse Helms had he driven a girl to the Outer Banks, run off a bridge into 8 feet of water, left the girl to drown, and waited ten hours to report the accident.

Of course when it comes to the heroes of the Left, the Mainstream Media (MSM) admonishes us that it's somehow "wrong" to dwell on "personal mistakes" (that's MSM-speak for sinful, egregious or criminal acts committed by fellow liberals... when it comes to the standard for conservatives... that's another issue altogether). Fine... let's look at where Kennedy stood on the great issues of our time. Though he originally ran as a pro-lifer, when elected Kennedy immediately betrayed pro-life voters and supported the killing of unborn babies every time he had the opportunity. He voted against a bill to define an unborn child as eligible for coverage under federally funded children's health insurance. He voted against a bill criminalizing the harming of an unborn fetus during the commission of a crime. He voted against banning partial-birth abortions - whenever it came up. Did it sicken you to see that spectacular funeral service at the Our Lady of Perpetual Help Basilica? Rather ironic when you consider that Kennedy had probably done more than any other man in the United States Senate during the past half-century to undermine the ideals of the Catholic Church (and all Christendom, for that matter). Kennedy - whose own promiscuous and lascivious life was frequently covered on the front pages nationwide - supported every so-called "gay-rights" bill that perversity could generate. Joe Solmonese, president of the Human Rights Campaign, said this: " Senator Kennedy has, more than anyone else, been our strongest voice in the United States Senate for the LGBT community. On every piece of legislation - every piece - Senator Kennedy has been the lead." Patrick McDonald, writing in Queer Town, said: "Unlike other politicians, Kennedy never wavered in his support of gay marriage, voting against the 1996 Defense of Marriage Act and an anti-gay federal marriage amendment." Senator Kennedy played a key role in bringing so-called "same-sex marriage" to Massachusetts. Had enough? There's more. He was bad on guns. He was bad on taxes. He was worse on illegal immigration. As a matter of fact, he wasn't good on anything.

How do we know that Left-wing radicals will exploit Kennedy's death to sell Obamacare? Read on! George Soros' MoveOn.org put it this way: "Tonight, please light a candle in your window to memorialize him. Tomorrow, as Senator Kennedy said, '...the work goes on, the cause endures, the hope still lives, and the dream shall never die.' Tomorrow, let's re-commit ourselves to achieving the thing that mattered most to him: Quality, affordable health care for every single American." Nancy Pelosi likewise hauled out her violin and and fiddled the following: "Ted Kennedy's dream of quality health care for all Americans will be made real this year because of his leadership and his inspiration." Jimmy Carter - who held the distinction of being the worst president in memory until Barack Hussein Obama took the oath of office - said on CNN that Kennedy's commitment to universal health coverage and the "resonance of his speeches" will influence Congress so "that we can still have a comprehensive health program passed this year." Chuck Schumer - typically one of the nastiest and strident voices in the Senate - said: "Ted Kennedy wanted to get health care reform done for 40 years, and even in the last month or two when he wasn't involved day-to-day, people would always be saying, 'Well what would Ted have done?'" When asked if Kennedy's death would move Congress to pass the health care bill, Schumer said, "I don't know. I would hope that his loss would importune us." Said Ed Klein, author of "Ted Kennedy: The Dream That Never Died": "A lot of people think that in the wake of his death that the White House will go to the 'blue dog' Democrats, the conservative Democrats, who have been dragging their heels on health care reform, and say, 'Look, let's do this for the gipper. Let's do this for Ted Kennedy. Let's get this passed and put his name on it.'" You see. It's coming. In fact, it's already here.

If you don't like personal attacks, remember Kennedy's vile attack on Robert Bork, Ronald Reagan's nominee for the Supreme Court. It was perhaps the most contemptible piece of character assassination ever uttered by a United States Senator. Here's just one quote "Robert Bork's America is a land in which women would be forced into back-alley abortions, blacks would sit at segregated lunch counters, rogue police could break down citizens' doors in midnight raids, and schoolchildren could not be taught about evolution, writers and artists could be censored at the whim of government, and the doors of the federal courts would be shut on the fingers of millions of Americans." As even the New York Times admitted in its recent obituary, it was a statement "that even friendly commentators called demagogic." Kennedy, People for the American Way, the National Organization for Women, and a gang of crazies defeated Bork's nomination by spending huge sums of money to spread provable lies. It was the end of a 200-year-old tradition of bipartisan courtesy in the selection of federal judges. Thanks, Teddy, for the 47 great years. We'll do everything possible to see that you won't have one more victory this fall.

Congress approves bonuses for their aides in the form of subsidies for student loans. Those earning up to $168,000 annually are eligible.

House quietly gives 'bonuses' to top aides


A month after they voted to punish some corporate executives for taking hefty bonus payouts, members of the House of Representatives quietly gave their own staffers a new potential bonus by making even their top-earning aides eligible for taxpayer dollars to repay their student loans.
The change, which took effect in May, means House employees earning up to $168,411, or the top level, are now eligible for government-funded subsidies to help pay down their student loans.
House officials defend the change as a job-related benefit necessary to keep the government competitive in the hiring market - the same argument corporate chieftains used to defend their own pay scales.
"There's still a tremendous demand for high-end Hill talent even in this current job market. Expanding eligibility for the benefit allows us to retain valued and seasoned personnel who might otherwise be lured away to more financially lucrative pursuits," said Kyle Anderson, a spokesman for the House Administration Committee.
The committee, which has jurisdiction over internal House employment, salaries and expenses, directed House officials to make the change.
But taxpayer advocacy groups said that straightforward salary increases - not new perks and bonuses - are the best way to attract and retain talent. Offering bonuses to some of the best-paid Capitol staffers just feeds into popular resentment toward Washington, said Thomas A. Schatz, president of Citizens Against Government Waste.
"It's another example of the imperial Congress and setting themselves aside from the rest of the country," Mr. Schatz said. "It goes along with the congressional jets, the executive jets. It goes along with the travel. It fits in with all the concerns about spending generally in Washington."
Although widely used in the federal work force, the job-related perk of paying off an employee's college bills is rarely offered in the private sector, employment analysts say.
The move to boost the income cap was made just a month after the House voted 328-93 in March to slap a 90 percent tax on bonuses for executives from companies that took bailout money from the Troubled Asset Relief Program. The Senate never followed suit, and the bill didn't become law. The salaries and dollar amounts involved in those bonuses were far higher than what's at stake in the House program.
The House program is expected to cost $12.6 million this fiscal year. As of August, it was making payments for 2,251 staffers. The Office of the Chief Administrative Officer, the branch of the House that administers the program, is unable to estimate how many of those staffers are taking part under the new, higher-income limits, spokesman Jeff Ventura said.
Mr. Ventura said that, with members of the House up for election every two years, job security is uncertain and the student loan program helps attract talent.
"We regard this benefit as a major job recruitment and retention tool," he said. "Even in a bad job market, we compete with the private sector for the kind of talented employees government work today demands."
The House program pays up to $10,000 a year, with a maximum lifetime benefit of $60,000. Staffers making any salary are now eligible, though their total compensation - including the loan repayment - cannot exceed the 2009 cap of $168,411. From 2008 through May of this year, the cap was $145,159.
Each representative decides which of his or her staffers can receive the benefit. The funds do not come out of each congressional office's budget, but there is a cap on how much each office can spend on the repayments. That cap was also boosted by 75 percent in May.
Student loan repayments are not limited to the House. The Senate offers a far less generous program than the House, while many executive branch agencies offer a similar program.
The Senate income eligibility cap for its program is $146,500 this year, which is about $23,000 less than the maximum a staffer could make. The Senate caps lifetime payments at $40,000 - $20,000 less than the House.
A spokeswoman for the secretary of the Senate, who administers the program, said the program will cost $4.7 million this year. That's up from $1 million in 2002, when the program began, but down from 2003, the peak year, when the Senate spent $6.8 million.
The spokeswoman would not give details about who participates in the program and referred questions to the committees with oversight over the program.
Executive branch agencies, meanwhile, provide an extensive annual accounting of their student loan benefit program, and it appears to be just as popular as the House program.
In 2008, federal agencies spent more than $51 million to repay loans for 6,879 employees, at an average benefit of $7,511. The 2008 figure is a 22 percent jump over the previous year.
Like House staff members, executive branch employees are limited to $10,000 per year and $60,000 over their lifetimes. The loan repayments are taxable.

Sure....Obama Respects the Constitution!