Wednesday, March 31, 2010

Henry Waxman is an Economic Chupacabra

Rep. Henry Waxman reminds me of a chupacabra, the legendary Latin American cryptid that supposedly stalks the night sucking the blood out of farmers’ livestock. Except instead of sucking the life out of farm animals, he sucks the life out of our economy. He also has an insatiable thirst for media attention that he staves off by holding congressional hearings. It seems every time there’s a government witch hunt or proposed government witch hunt, he’s the John Hathorne-wannabe thirsting for blood.


Pulitzer Prize-winning Washington Post columnist William Raspberry once likened him to Joseph McCarthy. A quick look over Waxman’s career makes it hard to deny the accuracy of the observation. In 1998, Rep. Waxman created a Special Investigations Division of the House Government Reform Committee to “conduct investigations of any matter” at “any time.” Waxman has used this inquisitorial squad to investigate everything from Valerie Plame to colored contact lenses to Holocaust-era insurance restitution. If you’ve read about it in the paper, heard it on the radio, or seen it on TV there’s a good chance Henry Waxman has thrown your tax dollars at investigating it.


As discussed in this blog’s last posting, the Congressional Chupacabra’s next victims will be CEOs of companies that have lost value as a result of Obamacare. The premise of this latest Henry Waxman hearing was aptly summed up by The Wall Street Journal: “The White House claims CEOs are reducing the value of their companies and returns for shareholders merely out of political pique.” It’s a far-fetched premise, but the Democrats have to grasp for something; the truth is too dangerous for them.


The reality is that if these corporations left the Obamacare writedowns unreported they’d be running afoul of the Securities and Exchange Commission. This isn’t some game corporate America is playing because they’re spoilsports. Even the AFL-CIO predicted Obamacare would “impose a dramatic and immediate impact on company financial statements.”


The Democrats hope they can silence reality though. They think a Waxman hearing is the way to go. He’s got a history of browbeating everyone from Roger Clemens to Big Tobacco into submission.


I’m going to make two predictions:


1) Waxman’s hearings are going to backfire. In calling the farmers back to the chupacabra’s lair, Waxman is providing the CEOs a prominent national forum to have their voices heard. With the well-documented truth on their sides, the CEOs are going to eviscerate the Democrats’ ill-conceived, fantasyland arguments over how Obamacare would bring costs down. The Congressional Chupacabra is going to get a pitchfork in his side.


2) If, in a couple of years, Henry Waxman catches wind that any companies failed to report their Obamacare writedowns, he’s going to haul their CEOs in for a hearing to browbeat them for violating SEC disclosure requirements. It’s what he does.


Hopefully someday soon the Congress will get serious and start tackling the issues Americans are truly worried about: our crippled economy and stagnant job growth. Hey! Here’s a thought: why not provide some of our unemployed citizens jobs building a coliseum to house all 3,500 CEOs Henry Waxman’s going to feel compelled to bully for giving the lie on Obamacare.

Monday, March 29, 2010

Obamacare Kills Jobs

In their desire to make history with a cradle to grave healthcare program the Democrats (Mary Jo Kill-jobs included) have further devastated the economy without even understanding their blunder. It seems in their preoccupation with passing Obamacare, Democrats failed to take a great many factors into account. One of which was the effect raising taxes on businesses would have on job growth. In recent years Democrats seem to have developed a skewed view of corporations as needlessly greedy and self-serving. The Democrats have lost perspective. Corporations have a fiduciary responsibility to make a profit so they can provide a return on investment to their shareholders. Corporations aren’t made up of nameless, faceless suits with sardonic grins; they’re made up of regular people. The executives, shareholders, managers, and employees alike are all human. When the government raises taxes on a corporation, they’re raising taxes on people.


Part of the Democrats’ plan to make Obamacare appear affordable is to close what White House Press Secretary Robert Gibbs calls a “loophole” which allowed corporations to deduct the full amount spent on prescription drug benefits for retirees from the corporation’s taxable income. This “loophole” was originally created in 2003 to incentivize employers to provide drug benefits to retirees in order to prevent the public system from being overwhelmed. Now, in the aftermath of the Obamacare legislation’s passage, companies of all kinds are facing an increased tax burden as a result of their decision to provide prescription drug benefits to retirees.


In the long term, this means many companies will terminate their retiree prescription drug benefits programs, leaving their retirees to rely on Obamacare and, thus, creating additional costs not factored into the estimates that claimed Obamacare would reduce the deficit. In the short term, employers are taking the increased tax burden right on the chin. Black-letter financial accounting rules require that corporations must immediately restate the present value of their earnings when a material change has been made. As the increased tax burden of Obamacare constitutes a material change, corporations have been announcing massive writedowns as a result of the Obamacare tax hikes:


AT&T -- $1 billion

Deere & Co. -- $150 million

Caterpillar -- $100 million

AK Steel -- $31 million

3M -- $90 million

Valero Energy -- up to $20 million


And those writedowns are just the tip of the iceberg; the consulting firm Towers Watson estimates that the total number of Obamacare writedowns will reach nearly $14 billion by year end. That’s $14 billion of wealth disappearing from the economy--$14 billion that could’ve been used for job growth: gone. It’s an obvious fact that too many Americans know all too well: when employers are faced with increased costs and economic downturn, they lack the resources to hire new workers. The state of our economy was already dire, now it’s worse.


Are the Democrats concerned? Yes, but not because of the implications for job growth. They’re concerned because in announcing the writedowns, employers have voiced an inconvenient reality the Democrats would prefer be kept silent: Obamacare is a job killer.


Infuriated by the audacity of corporate America in speaking the truth, Henry Waxman (D-CA), Chairman of the House Committee on Energy and Commerce, and Bart Stupak (D-MI), Chairman of the Subcommittee on Oversight and Investigations, will haul the CEOs of Deere & Co., Caterpillar, AT&T, and Verizon before Congress for a hearing on April 21. Apparently, the Congressional Democrats would prefer for CEOs to cook the books to make their balance sheets appear healthier than they are. The Democrats really ought to think through the aftereffects of using intimidation to bully CEOs into muddying the truth. It could wind up being even worse than that time they forgot to think through the aftereffects of passing a massive, shoddily-contrived healthcare reform bill.

Thursday, March 25, 2010

The Side Effects of Obamacare

Obamacare: Side effects include nausea, anxiety, really horny sexual predators, institutionalized fraud, and disingenuousness in Democrats. Speaker Pelosi told us Congress would have to pass the bill before we would fully find out what was in it. Now that Obamacare (which recently received the endorsement of Cuban strongman Fidel Castro) is the law of the land, a lot of details are coming out about what exactly the Democrats in Congress have thrust upon us.


One of the details we’re now learning about is that the bill will allow for your tax dollars to be converted to Viagra and given to convicted sex offenders. To correct this disturbing development Senator Tom Coburn (R-OK), a medical doctor, offered an amendment to the Senate healthcare reconciliation bill which would have criminalized taxpayer-funded Viagra for sex offenders. Seems reasonable, right? A rapist shouldn’t have the opportunity to smile, wink at his victim, and say, “This raping was paid for by your tax dollars.” And yet despite its un-debatable public benefit, Senator Coburn’s amendment was defeated by a Senate vote of 57-42.


Does that mean fifty-seven Democratic United States senators honestly believe taxpayer dollars should be used to subsidize Viagra for convicted child molesters and rapists? Even on my most cynical day I couldn’t believe that. United States senators know right from wrong—a fact which may make the truth even more disgusting: Despite knowing the wrongness of allowing this egregious violation of the public trust to continue, these fifty-seven Democratic senators chose wrong. They voted against Senator Coburn’s amendment because its passage went against their political interests. You see, if Senator Coburn’s amendment had passed it would have required an additional vote in the House of Representatives. Obamacare just barely squeaked through that chamber in a narrow 219-212 vote. Rather than face another explosive political battle in the House, the Democrats are opting to let anything and everything undesirable about the law as it is written stand—even if it means having sexual predators with chemically-enhanced libidos gallivanting around in our neighborhoods.


How shameful.


The Democratic opposition to Senator Coburn’s amendment also revealed a great hypocrisy of the Democratic Party. In addition to its opposition to taxpayer-funded Viagra for rapists, Coburn’s amendment included provision to enact recommendations from the non-partisan Government Accountability Office (GAO) for reducing Medicaid fraud.


In September 2009, Democratic Senator Tom Carper called the GAO recommendations “an enormous opportunity to save money” to the tune of “hundreds of millions of dollars.” And yet, Senator Carper and his fellow Democrats are now, apparently, against the recommendations. Their opposition is particularly disingenuous considering that a bulwark of their plan for funding Obamacare is by reducing fraud in Medicare and Medicaid


What inconsistency.


In torpedoing Senator Coburn’s amendment, Democrats also revealed the insincerity of their professed respect for independent non-partisan government agencies. In the run up to the vote on the healthcare reform bill Democrats were “absolutely giddy” to taut the non-partisan Congressional Budget Office’s estimates on the costs of Obamacare. They were more than happy to exploit the CBO’s non-partisan reputation when it suited their political agenda. But now that another non-partisan independent agency, the Government Accountability Office (sometimes known as “The Taxpayers' Best Friend”), has made recommendations that go against the Democrats’ agenda suddenly those non-partisan agencies aren’t so hot. If anything, the GAO report should carry greater weight than the CBO estimates. The GAO report analyzed what is, the CBO estimates only guessed what might be. If the Democrats were truly interested in non-partisan analysis, fiscal common sense, and sound public policy, they would not have voted against enacting the GAO recommendations for saving hundreds of millions of taxpayer dollars.


I’m sure a few hundred million dollars seems like chump change to the Congressional Democrats. After all, they just committed to spend over a trillion dollars on Obamacare. To the American people a few hundred million dollars is still a lot of money; most of us will never come close to having that much money. Is it too much to ask for the Democrats to put aside their petty political agendas in favor of being good stewards of the public treasury? Apparently they think so.

Wednesday, March 24, 2010

Mary Jo & the Politically Motivated Hearing

Congresswoman Mary Jo Kilroy may have just bumbled her way into exposing further evidence of the incompetence of Obama Administration Treasury Secretary Timothy Geithner. House Financial Services Committee Chairman Barney Frank (D-Mass.) has granted Congresswoman Kilroy’s request for a hearing into the already-investigated collapse of the former Wall Street banking company Lehman Brothers. Ms. Kilroy’s call for a hearing appears to be politically motivated by a desire to create a forum for attacking Ohio gubernatorial candidate and former Congressman John Kasich, a former employee of Lehman Brothers. Recent polls show Mr. Kasich on course to defeat Kilroy political ally Governor Ted Strickland in the November election.


Congresswoman Kilroy’s ill-conceived plan to discredit Mr. Kasich may backfire, however, as teams overseen by then-Federal Reserve Bank of New York President Timothy Geithner were in the office looking over the shoulders of Lehman Brothers executives as the questionable accounting practices responsible for the institution’s collapse took place. Geithner’s teams were provided desks, phones, computers, and total access to all of Lehman Brother’s books and records. The court-appointed bankruptcy examiner’s report does not indicate that Lehman Brothers kept two sets of books or attempted to hide its accounting practices from regulators. It would appear the questionable accounting was taking place in full view of Timothy Geithner’s team.


In fact, Timothy Geithner’s team appears to have gone to great lengths to give Lehman Brothers’s questionable accounting practices a passing grade. Geithner’s team may have even been complicit in disguising the instability of the institution. On page 1,488 of his report (page 445 of this PDF), the bankruptcy examiner describes how Tim Geithner’s team reduced standards to ensure Lehman Brothers would appear to be in good working order.


If Congresswoman Kilroy is serious about investigating the circumstances that led up to the collapse of Lehman Brothers, she must start with questioning Treasury Secretary Geithner’s ineffective oversight of the organization. If Geithner lacks the capacity to recognize “materially misleading” (the bankruptcy examiner’s words) accounting practices at a single Wall Street banking institution, how can he possibly have the competence to oversee the entire Treasury Department?


However, Ms. Kilroy doubtfully has the courage to ask the tough questions and demand accountability from Secretary Geithner, an Obama appointee. Instead she will undoubtedly use the hearing as an attempt to implicate Mr. Kasich in a scandal by his association as a Columbus-based employee of the collapsed institution.


NEVERMIND that the collapse of Lehman Brothers has already been investigated.


NEVERMIND that John Kasich was over 500 miles away in Columbus, Ohio while Timothy Geithner’s teams were in the room with Lehman Brothers executives as the questionable accounting occurred.


NEVERMIND the facts!


THIS IS POLITICS! By Kilroy’s reckoning, reality only muddies the water. She’s got to deliver for the Ohio Democratic Party so they will deliver for her.


If the Congresswoman were interested in representing her constituents she would devote her time towards fixing the economy and creating jobs, not breaking her knuckles beating a dead horse by reinvestigating a financial institution that collapsed years ago and has already been fully investigated.

Monday, March 22, 2010

Mary Jo in Wonderland

In the aftermath of a healthcare reform demonstration held outside her office last week Congresswoman Mary Jo Kilroy stated, "Hearing the voices of my constituents, and not Washington insiders, is crucial to my decision making process." Congresswoman Kilroy heard our voices. She knew what we wanted her to do. And then… she listened to Nancy Pelosi and went with the Washington insiders.

It’s
hardly surprising she’d betray us. Congresswoman Kilroy sides with Nancy Pelosi 99% of the time.

"I'm encourage that by passing [the healthcare bill we'll reduce the deficit by $100 billion over the next ten years," said Congresswoman Mary Jo Kilroy in a statement announcing her vote.

Alice isn’t the only one in Wonderland if Ms. Kilroy actually believes this healthcare bill will reduce the deficit. Democrats—Rep. Kilroy included—base their claims on projections from the Congressional Budget Office (CBO). Projections from the CBO. The CBO isn’t infallible. They don’t have a crystal ball to see into the future. The numbers they produce are estimates, and government estimates have been wrong before.

Let’s take a look at the history: In 1966 the cost of Medicare, a massive new government program much like Obamacare, was about $3 billion. The House Ways and Means Committee estimated that it would cost $12 billion (adjusted for inflation) by 1990. The actual cost in 1990 was $107 billion—nearly nine times the estimate!

Today’s estimates on the cost of Obamacare are based on the assumption that the Congress will do what it promises. The estimated $100 billion deficit reduction Congresswoman Kilroy is cooing about is based on the belief that Congress will, in the future, cut $523 billion dollars in Medicare spending. If Congress fails to make those cuts, the deficit will go up by $423 billion dollars.

The CBO estimates also assume that nothing drastic happens to the government’s revenue stream. The bill imposes $569.2 billion dollars in new taxes on private citizens as well as $52 billion dollars in new taxes on employers who already can’t afford to provide their employees healthcare. Employment is already hovering near 10% and the economic situation is such that businesses, faced with economic uncertainty, are scared to make new hires. Obamacare will kill job growth in the womb with these new taxes. As job growth is further arrested an increasing number of people will remain unemployed and need government subsidized health care (read as: more costs + less revenue = high deficit).

In the Wonderland Mary Jo Kilroy strolls through saying a massive government spending program will reduce the deficit and raising taxes will creates jobs might make it so. In the real world—the world where all of her constituents reside—a world with an ultra-weak economy, soaring unemployment, and an ever-deepening national debt we know that’s simply not true. In voting for this legislation Mary Jo Kilroy has once again demonstrated her worthiness of the moniker Mary Jo Killjobs.

Monday, March 15, 2010

A Choice for Mary Jo: Bow to Washington Insiders or Represent Her Constituents?

He promised to be a “transformational president”, but jobless voters are suddenly calling the President “NObama”. The White House bet big on healthcare when the big issue people care about is jobs.


The President has been chasing after healthcare since taking office over a year ago. Despite his party’s overwhelming control of both houses of Congress he still hasn’t gotten it done. With each passing day the President grows more and more desperate for a win.


According to Rasmussen Reports, 57% of Americans believe the health care reform plan now working its way through Congress will hurt the U.S. economy. It’d be a deranged fantasy to believe otherwise: the bill will drag the country billions deeper into the La Brea tar pit of our already massive national deficit—and will raise taxes while doing it.


The simple fact is that the majority of the American people do not want this legislation made law. The people are saying “NO!” to the corrupt bargains that were struck to get this bill through the Senate. The people are saying “NO!” to the Cornhusker kickback, the Lousiana Purchase, and the Florida Flim-Flam.


The Democrats in Congress are faced with a choice: to side with a desperate president who needs this victory to save his political skin or to side with the American people by rejecting a massively unpopular bill which will damage our economy by adding billions to the deficit and raising taxes on working Americans.


According to the Pew Research Center, the American peoples’ top priorities are the “economy” and “jobs”. Healthcare comes in at a very distant 8th place as a top priority. The takeaway: the people want to see the Congress and the White House focusing on our stagnant economy and on creating jobs.


Unemployment in Ohio is at a 26 year high. Stated another way, unemployment is the highest it’s been since President Obama was a 23-year-old college kid studying political science. The healthcare bill will do nothing to alleviate the staggering level of unemployment in our state. In fact, with the preferential treatment other states receive through the corrupt bargains struck in the Senate, the bill puts Ohio at further disadvantage.


If Congresswoman Kilroy sides with President Obama and Nancy Pelosi on voting for the healthcare bill she will be demonstrating in no uncertain terms where her loyalty lies: with desperately out of touch Washington insiders—not with her constituents in Ohio.

Wednesday, March 10, 2010

Kilroy Wants it Both Ways in Afghanistan

On May 14, 2009 Congresswoman Kilroy co-sponsored HR 2404, a resolution in the House of Representatives which, if passed, will order the Obama Administration to develop and execute an exit strategy for the war in Afghanistan, the country which hosted Osama bin Laden as he planned the September 11 attacks on our country. A few months later, in the run up to President Obama’s 30,000 troop surge, Ms. Kilroy stated in the Columbus Dispatch that “Afghanistan should be the central front against terrorism since those that [sic.] wish to do us harm have based their efforts in that part of the world.” The Columbus Dispatch reports today that Ms. Kilroy will vote against a resolution by her liberal ally and HR 2404 co-sponsor Rep. Dennis Kucinich (Democrat, OH-10) using an obscure and likely unconstitutional provision of the War Powers Act of 1973.


So to recap: Kilroy in May: PULL OUT! Kilroy in September: SURGE!


What does Congresswoman Kilroy have to say right now? Apparently nothing. In the Columbus Dispatch’s coverage of the House debate on Kucinich’s resolution most Central Ohio legislators were able to clearly state their positions. However, Ms. Kilroy conspicuously didn’t offer a quote to inform her constituents on her position.


Her silence is but the latest in an ages old political game the Congresswoman and her ilk like to play of trying to have it both ways. Ms. Kilroy is in bed with the anti-defense far-left: She’s sponsored a resolution directing Defense Secretary Gates to outline an exit strategy for the war in Afghanistan. She’s also a fawning devotee to the Obama Administration, and, at present, President Obama wants to stay the course in Afghanistan.


Congresswoman Kilroy is torn. She has backed herself into the unenviable position of needing to appease both her ultra-liberal masters and her allies in the Obama Administration. The conflict has left her ineffective and sinking in a mire of indecision.


The inconsistency of her positions has left those of us in her district unable to fathom how Congresswoman Kilroy genuinely feels about protecting us from the terrorists who wish to do us harm. What the Congresswoman has made perfectly clear is that she lacks resolve and will bend to political pressure on any and every issue—even our nation’s safety and security.


Congresswoman Kilroy is sending the wrong message to the terrorists. Through her actions she is exhibiting that our commitment to winning the war on terror is as fickle as the political winds.


Thankfully, the man challenging Kilroy in the upcoming 2010 election, Lt. Colonel Steve Stivers, has a solid understanding of what the result of cutting and running from the war in Afghanistan would entail. Said Stivers, “As a solider, I’m the first to wish we could end the engagement in Afghanistan, but to do so would embolden our enemies with a victory and move the front line in the war on terror to the United States.