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  • Archive for the 'Crony Capitalism' Category

    On This Texas Independence Day

    Posted by Jay Manifold on 2nd March 2016 (All posts by )

    What I’m feeling for the GOP is a kind of disinterested sympathy, punctuated with schadenfreude, the disinterest arising from never having been a Republican, the sympathy from the GOP identification of a plurality of my close friends – uniformly horrified by what is happening – and the schadenfreude from the abrupt collapse of three-plus decades of pharisaical social conservatism. Turns out that eventually enough of the electorate whose resentment you’ve been stoking figures out that it’s a waste of time and fastens on to something else, something that matches their actual resentments a lot more closely. Read the rest of this entry »

    Posted in Anti-Americanism, Blogging, Book Notes, Civil Society, Crony Capitalism, Current Events, Elections, History, Human Behavior, National Security, Politics, Predictions, Society, Trump, USA | 13 Comments »

    Macroeconomic Fallacies, Fed Chairman Bernanke’s Delusions and the Rise of Donald Trump

    Posted by Kevin Villani on 2nd March 2016 (All posts by )

    The G20 leaders recently called upon the leaders of the developed nations to employ more massive amounts of debt financed government spending to ward off the current economic stagnation and in some instances the early stages of recession. That fits Einstein’s definition of insanity: “doing the same thing over and over again but expecting a different result”. The pursuit of so-called “macroeconomic (fiscal and monetary) policies” has produced a quarter century of economic stagnation in Japan, a $30 trillion debt bubble in China with little to show, and stagnation and looming recession in Europe and increasingly in the US.

    Einstein was a genius who remains relevant today. Just within the last few weeks evidence was reported of gravitational waves predicted by Einstein almost a century ago. Proving Einstein’s theories has been the focus of physics during the past century, but he maintained that had he been able to get an academic appointment instead of a position at the Swiss patent office he never would have been able to develop and publish his new path-breaking theories.

    In his recently released biography The Courage to Act (2015), former Federal Reserve Chairman Ben Bernanke describes how, initially failing physics, he turned to macroeconomics as an outlet for his mathematical skills. This was auspicious. In physics, when your equations don’t fit the reality it is the equations that must be changed unless there is new evidence to change the understanding of reality. Einstein’s biggest error was rather than waiting for better data when his equations predicted an expanding universe, he fudged the equation (introducing the Max Planck constant) to fit the current understanding of a stagnant universe, then disagreed for most of his lifetime with the next generation of quantum physicists who proved he had gotten it right in the first place. Einstein’s one mistake is the modus operandi of modern macroeconomists.

    Read the rest of this entry »

    Posted in Big Government, Crony Capitalism, Economics & Finance, Elections, Politics, Systems Analysis, Tea Party, Trump, USA | 29 Comments »

    Meanwhile, In Europe

    Posted by Michael Hiteshew on 17th February 2016 (All posts by )

    Who does one call to get Europe on the phone? What is causing all the economic problems?

    And what is happening in Ukraine and why?

    And what should the USA be doing in all this? And is the USA an empire?

    Posted in Business, Crony Capitalism, Current Events, Economics & Finance, Entrepreneurship, Europe, International Affairs, Politics | 10 Comments »

    Trump and China

    Posted by Michael Kennedy on 15th February 2016 (All posts by )

    sse-stock

    Trump has, famously, gone after China on its trade policy.

    In January 2000, President Bill Clinton boldly promised China’s inclusion in the World Trade Organization (WTO) “is a good deal for America. Our products will gain better access to China’s market, and every sector from agriculture, to telecommunications, to automobiles. But China gains no new market access to the United States.” None of what President Clinton promised came true. Since China joined the WTO, Americans have witnessed the closure of more than 50,000 factories and the loss of tens of millions of jobs. It was not a good deal for America then and it’s a bad deal now. It is a typical example of how politicians in Washington have failed our country.

    There is an interesting analysis of China’s stumbling economy in the Observer today.

    Here is a top ten guide for the perplexed.

    Central Planning: Central planning, central planning. The history of the abject failure the Soviet Union’s five-year plans should tell you everything. Command and control economies that report to one man (in a nation of 1.3 billion people) are doomed from the start. Top down economic decisions often look bold and start out highly stimulative, but then degenerate into inefficiency, waste, politics and fraud.

    Political Corruption: As the command and control economy generates liquidity, the demand and direction of the distributed capital becomes a political tussle. Decisions on how much steel, cement, coal, glass solar panels, high speed trains and shopping malls—in short everything—are not done in China as a cost benefit analysis by risk capital, a job difficult enough in itself. (Witness the capitalist economies’ booms and busts.) In China, this liquidity was allocated by political muscle, massive bribery and kickbacks, rather than economic justifications.

    Basic Gangsterism: Counterfeiting, knockoffs, copyright infringement, theft of intellectual property – these were a part of the booster rockets of China’s economic rise. It was all supposed to go away after China joined the WTO in 2001. It didn’t. It just became more institutionalized. Foreign companies needed Chinese “partners” in auto production, healthcare and technology. These “partners” crippled the potential productivity of the investments and led to frequent disputes and even more corruption… as in the GlaxoSmithKline scandals.

    There are a total of nine reasons, many addressed in Trump’s piece above.

    Now, the economy of China may be in free fall.

    Read the rest of this entry »

    Posted in China, Crony Capitalism, Politics, Trump | 5 Comments »

    In Defense of Wall Street A**holes

    Posted by Kevin Villani on 11th February 2016 (All posts by )

    Long time Democrat turned Republican Donald Trump, who as a business titan relied more than any of his opponents on “Wall Street” funding, decisively won the Republican primary. In sharp contrast, socialist Bernie Sanders decisively won the New Hampshire Democrat primary by attacking his opponent’s Wall Street ties. Trump supporters apparently believe that the way to deal with Wall Street a**holes is a bigger a**hole who will negotiate much better deals, whereas Sanders supporters believe that “Wall Street (a synonym for the entire US financial system) is a fraud” requiring major extractive surgery.

    Most people within the NY financial community including the numerous mid-town asset management firms agree that many Wall Street players were a**holes during the sub-prime lending debacle leading to the 2008 financial crisis, but surely the Sanders pitchfork brigade wouldn’t travel uptown. This may explain why among the thousands of books and articles written in the aftermath of the financial crisis and the Occupy Wall Street movement, Wall Street hasn’t defended itself and has found few defenders willing to go public.

    Truth be told, Wall Street has always attracted more than its share of greedy a**holes. But historically they discriminated against the less profitable investments in favor of those that had the highest return potential relative to risk. This represented the brains of a heartless US capitalist system. Defenders of capitalism correctly argue that it is the only economic system at the base of all human economic progress, however unequally distributed. Progressive critics argue for greater equality, the poor made poorer so long as the better off are equally so (although this is not the way it is typically represented).

    Read the rest of this entry »

    Posted in Business, Crony Capitalism, Economics & Finance, Human Behavior, Markets and Trading, Politics, Predictions, Public Finance, Trump | 6 Comments »

    National Review goes Bananas

    Posted by Michael Kennedy on 23rd January 2016 (All posts by )

    National Review has now gone off the deep end on Donald Trump.

    This strikes me as fear and panic but about what ?

    But he is not deserving of conservative support in the caucuses and primaries. Trump is a philosophically unmoored political opportunist who would trash the broad conservative ideological consensus within the GOP in favor of a free-floating populism with strong-man overtones.

    Cue pearl clutching. What exactly has “the broad conservative ideological consensus” achieved the past 20 years ? Personally, I think Reagan began the problem by choosing Bush for his VP. Bush was antithesis to Reagan’s message and had ridiculed his economic plans.

    Sam Houston State University historian, writing on the Forbes web site, has a very odd blog post this morning. He criticizes MIT economist Simon Johnson for attributing the term “voodoo economics” to George H.W. Bush. Domitrovic calls it a “myth” that the elder Bush ever uttered those words. “You’d think there’d be a scrap of evidence dating from 1980 in support of this claim. In fact there is none,” he says.

    Perhaps down in Texas they don’t have access to the Los Angeles Times. If one goes to the April 14, 1980 issue and turns to page 20, one will find an articled by Times staff reporter Robert Shogan, entitled, “Bush Ends His Waiting Game, Attacks Reagan.” Following is the 4th paragraph from that news report:

    “He [Bush] signaled the shift [in strategy] in a speech here [in Pittsburgh] last week when he charged that Reagan had made ‘a list of phony promises’ on defense, energy and economic policy. And he labeled Reagan’s tax cut proposal ‘voodoo economic policy’ and ‘economic madness.'”

    It’s amusing to see people try to deny facts. Some argue that Bush did not oppose “Supply side” theory. Still, that is what “Voodoo Economic Policy” referred to. What else ?

    Bush promised “no new taxes” in 1988 but then raised taxes in 1990 creating or deepening a recession that cost him re-electiion and gave us Bill Clinton.

    Read the rest of this entry »

    Posted in Big Government, Conservatism, Crony Capitalism, Current Events, Elections, History, Politics, Trump | 36 Comments »

    Is the Ryan budget the last gasp of the public employee unions ?

    Posted by Michael Kennedy on 20th December 2015 (All posts by )

    As usual. Richard Fernandez has a unique view of current events. He compares the present federal government to Boss Tweed’s Tamany Hall.

    But in actuality the impetus for moderating political excess often comes from the elites themselves when mismanagement finally becomes so bad it threatens the survival of everyone.

    Until things reach the point of failure mismanagement has the effect of leaving voters no alternative but content themselves with the opposition party. Republican voters may have been disappointed and outraged at the perceived sellout by a Paul Ryan-led Congress to the Obama administration. “It was another Republican “compromise” meaning Democrats got every item they asked for,” said the Drudge Report.

    Paul Ryan has engineered a “compromise” with Democrats that gives them everything they wanted.

    Today, he defended it on Meet The Press.

    And in divided government you don’t get everything you want. So we fought for as much as we could get. We advanced our priorities and principles. Not every single one of them, but many of them. And then we’re going to pick up next year and pick up where we left off and keep going for more.

    Is this true ? I doubt it.

    Read the rest of this entry »

    Posted in Big Government, Civil Society, Conservatism, Crony Capitalism, History, Immigration, Obama, Politics, Tea Party | 21 Comments »

    Trust

    Posted by Sgt. Mom on 10th October 2015 (All posts by )

    A society as huge and complex as the United States can run economically only on the basis of acceptance and trust. This has been true for so long it is no longer noticed, like the air. People accept the rules and generally follow them whether or not there is a policeman in attendance. …. All over the the land people go about their business secure that arrangements will be honored and carried out. A high-trust society is a low-cost society.

    Wretchard, at the Belmont Club

    Of all that has changed over the last decade in the general culture of the United States, I wonder if a widespread loss of trust in the political, media, intellectual and bureaucratic establishments is the most quietly catastrophic of all the damage done to our society of late. It is axiomatic that once trust in an individual, a friend or a spouse is lost, it can almost never be regained; one of those things which is easily, almost casually done, never to be completely repaired. I suspect that we will discover over the next few decades that the thinking and observing portion of our society will never regain that unthinking trust in our institutions, now that we have seen them become weaponized in open and politically partisan ways. We have observed the national news media become politically partisan, more intent on hiding matters of significance than informing the public about them. What doesn’t appear above the fold, so to speak, or even in the back pages is sometimes more revealing. And the hate for ordinary American citizens in flyover country, frequently expressed by those residents of the wealthy bicoastal enclaves has been mind-boggling. There are personalities who have been so casually offensive in this regard that I have made it a point to avoid patronizing with my pocketbook anything that they have had anything to do with. I suspect that I am not alone in this – it’s another element of that ‘cold anger’ that I wrote about some days ago. How has it come to be that the so-called ruling elite of a nation now appear to hold their fellow-citizens in such deep contempt? (This contempt has begun to be returned with interest of late, although the ruling elites are predictably mystified by such quiet demonstrations as in the Chick-Fil-A appreciation day, the failure of certain lavishly promoted moves and TV shows, and heavily attended Tea Party rallies of a few years ago.)

    Read the rest of this entry »

    Posted in Americas, Anti-Americanism, Big Government, Civil Society, Conservatism, Crony Capitalism, Deep Thoughts, Entrepreneurship, Obama | 18 Comments »

    Here We Go !

    Posted by Michael Kennedy on 24th August 2015 (All posts by )

    ghost

    I have been pessimistic for several years. That may be just my own psychological makeup but I am not the only one.

    California is getting a bit agitated about what is happening in China.

    Gyrations in the stock market have taken California’s fragile finances for a ride before — when the dot-com bubble burst, when the Wall Street crash sank the national economy less than a decade ago.

    So when the market continued its dive Monday, state officials began glancing around for their seat belts.

    More than most states, California depends heavily on taxes from the wealthy, pulling about half of its income tax revenue from just 1% of residents in recent years.

    California is a top down society because it depends on income tax. Texas doesn’t and its state government is funded by sales tax, which everyone pays, even illegals.

    The Obama Administration has been playing a Ponzi Scheme for years.

    A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator.

    Read the rest of this entry »

    Posted in Big Government, Book Notes, Civil Society, Conservatism, Crony Capitalism, Current Events, Economics & Finance, Leftism, Politics | 5 Comments »

    Elite Failure and Populist Trump It

    Posted by Zenpundit on 5th August 2015 (All posts by )

    Cross-posted at Zenpundit.com

    Donald_Trump_March_2015

    GOP Front Runner, Donald J. Trump (Image: Michael Vadon)

    A friend sent an essay by the prolific IR scholar, Professor Angelo Codevilla that had been posted at Powerline Blog.  It was good.

    For the unfamiliar, Codevilla often writes on national security and intelligence matters and some readers may be familiar with his (with Paul Seabury) book,  War: Ends and Means; but in recent years Codevilla has, like Walter Russell Mead and a number of other intellectuals, turned his attention to the shoddy performance, ethical deficiencies and arrogant demands of the new American “ruling class”, writing a biting critique of their “meritocratic regime”.

    In his essay for Powerline, Codevilla turns his attention to the political phenomenon of the improbable GOP presidential front runner, billionaire and reality TV star, Donald Trump.  Unsurprisingly, Dr. Codevilla is not a huge fan of the bombastic Mr. Trump, but his analysis of why Trump has captured the moment so easily has some astute insights about the decaying state of our political system and the seething anger of the electorate:

    Read the rest of this entry »

    Posted in Big Government, Book Notes, Civil Liberties, Crony Capitalism, Current Events, Elections, Leftism, Media, National Security, Politics, Society, Tea Party, The Press, USA | 15 Comments »

    Socialism is running out of other people’s money

    Posted by Michael Kennedy on 1st August 2015 (All posts by )

    Socialism is on its last legs except for college faculty lounges. Venezuela is now seizing private companies’ facilities.

    “There is an economic war here and this company, Polar, is at the heart of it. They hide products from the population, and inflate their prices!”
    The government had first notified the landlord of plans to expropriate the industrial park in 2013, Nestle spokesman Andres Alegrett said by telephone from Caracas on Thursday. Nestle used the facility to dispatch about 10 percent of its products in the country, supplying sweets and drinks to the western side of Greater Caracas, he said.

    Nestle is no stranger to Socialism. Jonah Golberg noted Nestle’s connection years ago.

    About ten years ago I went on a junket to Switzerland and attended a talk with the CEO of Nestlé. Listening to him, it became very clear to me that he had little to no interest in free markets or capitalism properly understood. He saw his corporation as a “partner” with governments, NGOs, the U.N., and other massive multinationals. The profit motive was good for efficiency and rewarding talent, but beyond that, he wanted order and predictability and as much planning as he could get. I think that mindset informs the entire class of transnational progressives, the shock troops of what H. G. Wells hoped would lead to his liberal-fascist “world brain.”

    Yes, Nestle has a history of cooperation with various do-gooder initiatives although it has kept its eye on profits.

    Read the rest of this entry »

    Posted in Americas, Big Government, Crony Capitalism, Economics & Finance, Leftism, Politics | 5 Comments »

    Civil Wars everywhere in politics.

    Posted by Michael Kennedy on 25th July 2015 (All posts by )

    Tia Oso

    At the “Netroots Nation Conference, while an illegal alien was interviewing Martin O’Malley, a Democrat candidate for president, the stage was invaded by a black convicted felon (embezzlement) named Tia Oso who protested when O’Malley said “All lives matter.”

    Chanting, “What side are you on, my people, what side are you on?” and “Black lives matter,” the demonstrators moved to the front of the ballroom about 20 minutes into the event as Mr. O’Malley discussed proposed changes to Social Security. They remained there, heckling the candidates and posing questions, until organizers shut down the event, one of the centerpieces of the annual Netroots Nation conference.

    The Democrats are going to have serious problems with the black activist movement.

    The black radicals even plan to dig up the remains of General Nathan Bedford Forrest and his wife, law or no law. This sort of lunatic behavior is going to discredit this stuff pretty soon.

    Of course the Connecticut Democrat State Central Committee voted to remove the names Jefferson and Jackson from their annual celebration, so the black radicals not that much more crazy.

    Connecticut state Democrats voted Wednesday to remove the names of former presidents Thomas Jefferson and Andrew Jackson from their annual fundraising dinner, reportedly because of their ties to slavery.

    According to the Hartford Courant, it only took two minutes for the Connecticut Democrat State Central Committee to unanimously pass a resolution stripping both names from the title of the Jefferson-Jackson-Bailey Dinner.

    Party Chairman Nick Balletto proposed the change. He told the Daily Caller the decision, which apparently came under pressure from the NAACP, was about party identity.

    Yup, the lunacy continues.

    Read the rest of this entry »

    Posted in Big Government, Civil Society, Conservatism, Crony Capitalism, Economics & Finance, Elections, Politics | 17 Comments »

    Herman on Scooter Libby

    Posted by Ginny on 31st May 2015 (All posts by )

    Arthur Herman, often referred to here, describes in Commentary the context of the pursuit of Scooter Libby. I am curious about how those more knowledgeable than I see the article.

    But, aside from his central argument, I was struck by the remarkable picture with which he closes.

    On October 11, 2003, when the media witch hunt in the Plame case was at its height, there was a Cabinet meeting at the White House. When reporters were invited in to ask Bush a question about the investigation, Bush said he wanted anyone in his government who knew who had leaked Plame’s name to speak up. Sitting a couple of chairs away was Richard Armitage, the man who had done it. Sitting beside the president was Colin Powell, to whom Armitage had confessed days earlier.
     
    They said nothing—and kept silent for three long years. By the time Armitage admitted publicly that he had been the leaker in September 2006, Patrick Fitzgerald’s monstrously successful and spectacularly dishonest war on Scooter Libby’s job, reputation, finances, and legal innocence was well on its way to its morally depraved triumph.

    Read the rest of this entry »

    Posted in Biography, Book Notes, Crony Capitalism, Human Behavior, Iraq | 15 Comments »

    The Energy Crisis in Africa.

    Posted by Michael Kennedy on 3rd May 2015 (All posts by )

    india-solar-power-2012-640x426

    This is a powerful piece on the cost of environmental extremism to the world’s poor.

    The soaring [food] prices were actually exacerbated (as the Food and Agriculture Organisation of the UN confirmed) by the diversion of much of the world’s farmland into making motor fuel, in the form of ethanol and biodiesel, for the rich to salve their green consciences. Climate policies were probably a greater contributor to the Arab Spring than climate change itself.

    The use of ethanol in motor fuels is an irrational response to “green propaganda. The energy density of biofuel, as ethanol additives are called, is low resulting in the use of more and more ethanol and less and less arable land for food.

    Without abundant fuel and power, prosperity is impossible: workers cannot amplify their productivity, doctors cannot preserve vaccines, students cannot learn after dark, goods cannot get to market. Nearly 700 million Africans rely mainly on wood or dung to cook and heat with, and 600 million have no access to electric light. Britain with 60 million people has nearly as much electricity-generating capacity as the whole of sub-Saharan Africa, minus South Africa, with 800 million.

    South Africa is quickly destroying its electricity potential with idiotic racist policies.

    Just to get sub-Saharan electricity consumption up to the levels of South Africa or Bulgaria would mean adding about 1,000 gigawatts of capacity, the installation of which would cost at least £1 trillion. Yet the greens want Africans to hold back on the cheapest form of power: fossil fuels. In 2013 Ed Davey, the energy secretary, announced that British taxpayers will no longer fund coal-fired power stations in developing countries, and that he would put pressure on development banks to ensure that their funding policies rule out coal. (I declare a commercial interest in coal in Northumberland.)
    In the same year the US passed a bill prohibiting the Overseas Private Investment Corporation — a federal agency responsible for underwriting American companies that invest in developing countries — from investing in energy projects that involve fossil fuels.

    Read the rest of this entry »

    Posted in Crony Capitalism, Energy & Power Generation, Environment, International Affairs, Leftism, Politics, Science | 3 Comments »

    The Hillary Clinton bribery story.

    Posted by Michael Kennedy on 23rd April 2015 (All posts by )

    UPDATE: For those with short attention spans, a new timeline from Ricochet on the Hillary scandal.

    Best tidbit:

    Hillary Clinton’s family’s charities are refiling at least five annual tax returns after a Reuters review found errors in how they reported donations from governments, and said they may audit other Clinton Foundation returns in case of other errors… For three years in a row beginning in 2010, the Clinton Foundation reported to the IRS that it received zero in funds from foreign and U.S. governments, a dramatic fall-off from the tens of millions of dollars in foreign government contributions reported in preceding years.

    Must have been an oversight.

    Today, the New York Times ran a huge story about how Hillary Clinton and Bill took large contributions to their personal “Foundation” to sell US security assets to the Russians.

    The article, in January 2013, detailed how the Russian atomic energy agency, Rosatom, had taken over a Canadian company with uranium-mining stakes stretching from Central Asia to the American West. The deal made Rosatom one of the world’s largest uranium producers and brought Mr. Putin closer to his goal of controlling much of the global uranium supply chain.

    But the untold story behind that story is one that involves not just the Russian president, but also a former American president and a woman who would like to be the next one.

    At the heart of the tale are several men, leaders of the Canadian mining industry, who have been major donors to the charitable endeavors of former President Bill Clinton and his family. Members of that group built, financed and eventually sold off to the Russians a company that would become known as Uranium One.

    Today, Hugh Hewitt interviewed Mitt Romney on this story and Romney stated the obvious.

    What’s your reaction to this story?
    MR: You know, I’ve got to tell you, I was stunned by it. I mean, it looks like bribery. I mean, there is every appearance that Hillary Clinton was bribed to grease the sale of, what, 20% of America’s uranium production to Russia, and then it was covered up by lying about a meeting at her home with the principals, and by erasing emails. And you know, I presume we might know for sure whether there was or was not bribery if she hadn’t wiped out thousands of emails. But this is a very, very serious series of facts, and it looks like bribery.

    Now we know why the e-mails were deleted.

    As the Russians gradually assumed control of Uranium One in three separate transactions from 2009 to 2013, Canadian records show, a flow of cash made its way to the Clinton Foundation. Uranium One’s chairman used his family foundation to make four donations totaling $2.35 million. Those contributions were not publicly disclosed by the Clintons, despite an agreement Mrs. Clinton had struck with the Obama White House to publicly identify all donors. Other people with ties to the company made donations as well.

    And shortly after the Russians announced their intention to acquire a majority stake in Uranium One, Mr. Clinton received $500,000 for a Moscow speech from a Russian investment bank with links to the Kremlin that was promoting Uranium One stock.

    I looked at Huffington Post for reaction for the left and they have a story about Republicans and lobbyists.

    About the Hillary story ?

    ZERO !!!!

    This should be the end of her campaign but Democrats seem not to be interested.

    Posted in Crony Capitalism, International Affairs, Military Affairs, Politics, Russia | 18 Comments »

    The Failure of State Sponsored Capitalism

    Posted by Carl from Chicago on 31st December 2014 (All posts by )

    It is my assertion that over the last few decades since the fall of communism a lack of understanding of how markets actually work has become commonplace around the world. When it was capitalism vs. communism (or socialism, or even fascism), you generally knew where you stood. To wit:

    • Capitalism said that the free market would provide the best outcome for society, while communism / socialism felt that capitalism had to be tempered and / or that key assets should be owned by the state 
    • Capitalism said that government should be small, and stick to a few areas of logical focus such as security and foreign affairs, while socialism / communism celebrated government and government jobs as a way to employ the citizenry and achieve social goals

    Subtly, the growing attraction of jobs that were primarily in the government sector (environmental jobs, education jobs, health care jobs, and outright government work) and the basic thought that you could build a nice, steady career there with assured benefits and pensions while “doing right for the world” became commonplace. These jobs were often seen as “nicer” and “better” than the ruthless corporate jobs that are continually vilified or parodied on television (such as “The Office” or virtually any thriller set in business).

    On a parallel scale, the idea that “State Owned Enterprises” (SOE) could be a significant part of the world economy, and compete effectively with private sector companies, became widespread. Let’s leave aside the companies that fell into the US governments’ hands during 2008-9 like the banks and car companies; I am focusing on the world wide companies, often country “champions”, that are in our midst and whose performance has now been hit with the usual causes of failure of these sorts of entities, including:

    1. Politically motivated investment
    2. Forced government subsidies or protectionist behavior
    3. Corruption
    The “poster child” for this negative outcome is Petrobras, the Brazilian oil company, which is 64% owned by the state.  Petrobras was briefly the 4th most valuable company in the world after their 2010 IPO; now it is barely in the top 100.  Petrobras hits all these typical failure points with a vengeance.  The government forced them to purchase goods and services from inefficient Brazilian suppliers, subsidized their citizens with Petrobras funds, pushed them to invest in deep offshore finds which were risky relative to the company’s capabilities, and finally just engaged in simple corruption to fund their political party candidates.  All of these actions weakened the company and now a downturn in oil prices and a heavy debt load put the company in a seriously bad state.

    Read the rest of this entry »

    Posted in Business, China, Crony Capitalism, Economics & Finance, Education | 20 Comments »

    Obama’s Amnesty

    Posted by Michael Kennedy on 23rd November 2014 (All posts by )

    I am not happy about Obama making his speech about amnesty and defying the GOP newly elected Congress to do anything about it. However, there is less here than it seems.

    First: And to those members of Congress who question my authority to make our immigration system work better or question the wisdom of me acting where Congress has failed, I have one answer: Pass a bill. I want to work with both parties to pass a more permanent legislative solution. And the day I sign that bill into law, the actions I take will no longer be necessary.

    king obama

    I don’t believe him but the GOP could do worse than assume this is true. The next steps would be to take actions assuming he was not lying.

    Obama clearly wanted to make himself look like the compassionate actor in this debate, and Republicans the heartless, cruel nativists. Instead of trying to fight that battle, make Obama own it and bypass it for the real battle the GOP wants to win on border security. Make Democrats vote against a border security bill, and make Obama veto one while his own amnesty remains in place.

    Not everybody is willing to accept this as a phony gesture which I think it is.

    When President Obama announces that he will be suspending laws to bless the illegal presence of millions of foreigners in the United States, he will have adopted the most basic philosophy of John C. Calhoun: some laws can be tossed aside because his ends justify the lawlessness.

    I don’t trust Obama’s intent but I think he is a fool and did not plan this correctly, or else chickened out. There is more interesting comment at Powerline today.

    Procedurally what happens is an undocumented person applies for ‘deferred action’ and then after receiving this ‘quasi-status’ – he/she is eligible for work authorization.

    See the last paragraph on page 4 of this key memo: “Applicants must file the requisite applications for deferred action pursuant to the new criteria described above. Applicants must also submit biometrics for USCIS to conduct background checks similar to the background check that is required for DACA applicants. Each person who applies for deferred action pursuant to the criteria above shall also be eligible to apply for work authorization for the period of deferred action, pursuant to my authority to grant such authorization reflected in section 274A(h)(3) of the Immigration and Nationality Act.”

    I still think the Republicans can trump this with real reform. Then they can send a bipartisan bill to Obama and see if he vetoes it. That Powerline post also emphasizes that Silicone Valley is pushing this and that explains their support of Obama.

    How many Senate Democrats would be willing to sustain that veto before the 2016 election? I’m betting not too many. But Republicans have a perfect opportunity to turn the debate in that direction now and force Obama and his shrinking number of allies on Capitol Hill to go on the record.

    Read the rest of this entry »

    Posted in Big Government, Crony Capitalism, Current Events, Immigration, Law Enforcement, Obama, Politics | 14 Comments »

    An Update on healthcare reform.

    Posted by Michael Kennedy on 21st July 2014 (All posts by )

    Cash medical practice or, in the phrase favored by leftists critics, “Concierge Medicine,” seems to be growing.

    Becker is shifting to a new style of practice, sometimes called concierge or retainer medicine. With the help of a company that has been helping physicians make such shifts for over 13 years, he will cease caring for a total of 2,500 patients and instead cut back to about 600. These patients will pay an annual fee of $1,650. In exchange, they will receive a two-hour annual visit with a complete physical exam, same-day appointments, 24-hour physician phone access, and personalized, web-based resources to promote wellness.

    The article suggest that all these doctors choosing to drop insurance and Medicare are primary care. Many are but I know orthopedists and even general surgeons who are dropping all insurance.

    The concierge model of practice is growing, and it is estimated that more than 4,000 U.S. physicians have adopted some variation of it. Most are general internists, with family practitioners second. It is attractive to physicians because they are relieved of much of the pressure to move patients through quickly, and they can devote more time to prevention and wellness.

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    Posted in Big Government, Bioethics, Crony Capitalism, Health Care, Medicine, Politics, Science | 23 Comments »

    Prediction: Romney 2016.

    Posted by Michael Kennedy on 3rd July 2014 (All posts by )

    I have been predicting this, especially since these polls.

    Even the Washington Post has second thoughts.

    Romney would hold a slight lead on President Obama if the 2012 election were replayed today, according to a new Washington Post-ABC News poll.

    The poll of registered voters shows Romney at 49 percent and Obama at 45 percent in the rematch, a mirror image of Romney’s four-point (51-47) popular-vote loss in 2012.

    Now, we have this.

    What can I say except I told you so.

    Will Romney be different from these other failed nominees? Could he defy the odds and make a comeback presidential bid capturing the GOP nomination after all the doubt, second-guessing and blame that accompany such a loss? According to the latest Quinnipiac poll, many Americans seem to think so—45 percent of voters said the United States would be better off today with Romney as president.

    I donated more to the Romney campaign than I have in any other election and I was a volunteer for McCain in 2000.

    I told you so. I think there is a case that the 2012 election was stolen.

    The knowledge that the 1960 election was probably stolen helped Nixon in 1968. That and the failure of the Johnson Administration in Vietnam. Anyway, I have been predicting this for a while at Althouse and I can’t remember if I have posted this opinion here. Obama, with the time he has left, will make this more and more attractive. I thought we were doomed after 2012. I still think so but maybe I was wrong. The Megyn Kelly interviews with Bill Ayers might even help although she never got into the Ayers-Obama relationship.

    I just hope we avoid the worst of the blowback from inept foreign policy before 2016.

    More. This is amazing.

    All this is weird, unprecedented. The president shows no sign—none—of being overwhelmingly concerned and anxious at his predicaments or challenges. Every president before him would have been. They’d be questioning what they’re doing wrong, changing tack. They’d be ordering frantic aides to meet and come up with what to change, how to change it, how to find find common ground not only with Congress but with the electorate.

    Instead he seems disinterested, disengaged almost to the point of disembodied. He is fatalistic, passive, minimalist. He talks about hitting “singles” and “doubles” in foreign policy.

    “The world seems to disappoint him,” says The New Yorker’s liberal and sympathetic editor, David Remnick.

    Just weird.

    Posted in Big Government, Civil Liberties, Crony Capitalism, Current Events, Elections, Health Care, Middle East, Obama, Politics, Polls, Predictions | 25 Comments »

    Julie Burchill on Margaret Thatcher, Newly Timely After Nine Years

    Posted by Chicago Boyz Archive on 2nd July 2014 (All posts by )

    [A]s some smart-aleck said, we must change or perish. And who should break our long postwar consensual slumber — not with a snog but with a short sharp smack around the head with a handbag and a cry of “Look smart!” — but the Iron Lady herself.
     
    Mrs Thatcher meant, and still means, many things — some of which she is not yet aware of herself, as we are not. Only death brings proper perspective to the triumphs and failures of a political career; it is only with the blank look and full stop of death that that old truism “all political careers end in failure” stops being true. Only a terminally smug liberal would still write her off as an uptight bundle of Little Englandisms, seeking to preserve the old order, however hard she worked that look at first; voting for her was something akin to buying what one thought was a Vera Lynn record, getting it home and finding a Sex Pistols single inside.
     
    She was just as much about revolution as reaction, and part of any revolution is destruction. Some of the things she destroyed seemed like a shame at the time, such as the old industries — though on balance, isn’t there anything good about the fact that thousands of young men who once simply because of who their fathers were would have been condemned to a life spent underground in the darkness, and an early death coughing up bits of lung, now won’t be?

    Here is the original article. RTWT.

    Let’s hear that one more time:

    “She was just as much about revolution as reaction, and part of any revolution is destruction.”

    Read the rest of this entry »

    Posted in America 3.0, Anglosphere, Arts & Letters, Big Government, Book Notes, Britain, Conservatism, Crony Capitalism, History, Judaism, Middle East, Politics, Tea Party, USA | 4 Comments »

    Is the United States becoming a corrupt enterprise ?

    Posted by Michael Kennedy on 22nd May 2014 (All posts by )

    The activities of the Obama administration have progressed into Mafia territory the past five years. I never thought things could change this fast but it seems I was wrong. The latest example ?

    Soon after the US Government sold the last of its stake in General Motors, the company began to announce a huge number of recalls. These safety defects were known for years but unreported until the federal government sold its interests, at a huge loss of course.

    Taxpayers, drivers, and investors who assumed the government would never fail to disclose rampant safety problems in a company it owned can rest easy, though. Instead of investigating fatally flawed GM components while the U.S. government was the company’s largest single owner, the NHTSA was busy harassing Toyota — one of GM’s top competitors — for an alleged malfunction that led to “unintended acceleration” in Toyota vehicles. Toyota was fined and eventually bullied into recalling 8 million vehicles over the issue.

    Toyota is probably the safest, highest quality auto maker in the world. I drive one and have bought Toyotas for my daughter.

    And what was the final result of the NHTSA investigation?

    Many drivers may have confused the gas and brake pedals a problem that may account for “the vast majority” of the unintended acceleration incidents the agency investigated, NHTSA deputy administrator Ron Medford said at Tuesday’s NHTSA press briefing.

    “What mostly happened was pedal misapplication where the driver stepped on the gas instead of the brake or in addition to the brake,” Medford said.

    The Toyota cases were always about driver error, not safety of the auto. Only the trial lawyers and a complacent government permitted this raid on a company to proceed.

    Is that the only case ?

    Read the rest of this entry »

    Posted in Big Government, Crony Capitalism, Current Events, Health Care, Morality and Philosphy, Obama, Politics | 87 Comments »

    “… a uniquely malignant threat to American exceptionalism”: Sen. Mike Lee Nails It

    Posted by Chicago Boyz Archive on 13th May 2014 (All posts by )

    Government of course remains the problem, but the nature of that problem has evolved dramatically since Reagan’s first inaugural. If Republicans want to grow their party into a national majority, we must begin, as Reagan did in 1981, by confronting our present crisis: America’s large and growing Opportunity Deficit, namely, immobility among the poor and insecurity in the middle class.
     
    Compounding the shortage of opportunities among the poor and middle class is an unholy union of big government, big business, and big special interests that twists public policy to benefit Washington insiders unfairly at the expense of everyone else.
     
    This is America’s growing crisis of crony capitalism, corporate welfare, and policy privilege, and it represents a uniquely malignant threat to American exceptionalism.

    RTWT

    Posted in Crony Capitalism, Politics | 51 Comments »

    Income inequality: Social justice or crony capitalism?

    Posted by Kevin Villani on 26th April 2014 (All posts by )

    The political movement Occupy Wall Street has shaped the tax and spending proposals of the Obama administration’s budget and political debate on the premise that our capitalist economic system is rigged to favor the top-earning “one percenters.” But income inequality can result either from capitalism or politics, each for better or worse.

    Historically, political elites focused on enriching themselves at the expense of the general public: In 1773 patriots threw the tea into Boston Harbor of the East India Tea Company, granted a “royal charter” in 1600. The U.S. system was founded not just on the principles of democracy but on limited government complementing private market capitalism that encouraged individuals to “pursue happiness” — accumulate wealth — on merit rather than political connections. Support for the less fortunate was provided by family members, religious and other charitable organizations.

    Believing (wrongly) that class envy against the new economic elites — innovative entrepreneurs — would cause revolution, Karl Marx offered the socialist alternative “from each according to his ability, to each according to his need” with politics supplanting merit. Despite totalitarian methods universally employed by governments seriously pursuing the socialist model leading to the murder of tens of millions, one historian recently concluded that communism reduced workers “to shiftless, work-shy alcoholics.”

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    Posted in Big Government, Crony Capitalism, Economics & Finance, History, Political Philosophy, Public Finance, Taxes | 15 Comments »