FDR+BHO = SOL

"Like FDR, President Obama inherited a nation in economic crisis. Let us not forget, however, that Roosevelt’s policies converted the crisis into a decade-long full-blown depression. Why anyone would seek to emulate that experience is beyond me." - Alan Blinder, in a letter to the Wall Street Journal

Let's roll this chart out again, shall we?

Whited's Law - "A depression is a recession that the government tried to kill." 

See: Roosevelt, Franklin D., Carter, James E., and Obama, Barack H. 

FDR Logic

Seriously. 
They really did this. 
And the Depression went on and on and on. 

On the care and feeding of recessions

Congratulations on your new recession ! 
Here's how to care for and feed your new economic downturn.  Just think....  By applying the right policies, you may be one of the lucky few to turn your baby downturn into a full-blown depression. 
Maybe, just maybe, you can follow in the footsteps of FDR and grow A Great Depression !   But for now, let's start small. 

1) The best way to grow a recession is to try to kill it.  Get Congress, the President, the Unions and the courts involved in killing the recession.  These are the people who couldn't run a profitable whorehouse, so your recession is bound to thrive and prosper. 

2) Take money from one group and give it to another group.  Claim that it is for our own good, and that this will help kill the baby recession.  If this doesn't scare away economic growth, nothing will.  Then sit back and watch your baby recession grow to maturity. 

3) Apply various Keynesian stimulus measures, and apply them deeply and throroughly.  Stimulus, stimulus, stimulus.  Prevent consumers from spending their own money as they see fit.  YOU are the one who is trying to save a recession.  Those selfish Tea Party Bastards are trying to reward vendors and suppliers who fill consumers' needs.  The State wants to reward donors and unions.  Which group do you want spending the money ?  Doh!!  You have an infant recession to take care of. 

4) Take a bunch of people who have never had to hire anybody, fire anybody, or produce a profit, and give them the responsibility for "creating jobs".

5) Let governors get away with bragging about how many jobs that they created.  This confuses the electorate, and continues the illusion that a larger, more active government helps an economy.  In reality, this just helps your baby recession grow.  

6) Like many other living things, recessions grow best in mounds of bullshit.  Apply it liberally.   

This chart showing ideal recession growth came from Reason magazine.  Anyone wanting to grow a recession should avoid this magazine at all costs. 

Welcome Back Carter

It was 32 years ago today. 
Jimmy Carter gave his infamous "malaise" speech.
It actually holds up pretty well, but nobody was in the mood for it at the time. 
No one wants to listen to sanctimonious hectoring about shared sacrifice from someone widely perceived as the root cause of the need for shared sacrifice. 

Here's a Jimmy Carter/Barry Obama mashup, assembled by some genius from the Laura Ingraham show. 

Thomas Sowell on the people "who drove the car into the ditch"

Please stand for this month's reading from The Gospel According To Saint Thomas....

Economist Thomas Sowell, the smartest man in the world now that Milton Friedman is dead, has given us new insights into those "who drove the car into the ditch", as our president keeps claiming has happened. 

Another political fable is that the current economic downturn is due to not enough government regulation of the housing and financial markets. But it was precisely the government regulators, under pressure from politicians, who forced banks and other lending institutions to lower their standards for making mortgage loans.


These risky loans, and the defaults that followed, were what set off a chain reaction of massive financial losses that brought down the whole economy.

So it doesn't matter who was driving the car when it inevitably went into the ditch?  Perhaps we should question those who dug the damn ditch that was running across the middle of the interstate?  Give us more, O Saint Thomas, give us more....

Was this due to George W. Bush and the Republicans? Only partly. Most of those who pushed the lowering of mortgage lending standards were Democrats-- notably Congressman Barney Frank and Senator Christopher Dodd, though too many Republicans went along.

At the heart of these policies were Fannie Mae and Freddie Mac, who bought huge amounts of risky mortgages, passing the risk on from the banks that lent the money (and made the profits) to the taxpayers who were not even aware that they would end up paying in the end.

However, anyone who reads the scriptures of Saint Thomas would've seen this coming from afar.  As the good Doctor Sowell has pointed out many times, the stated goals and objectives of any policy do not matter.  All that matters are the incentives that are created.  In this case, Fannie and Freddie were incentivized to take insane risks because they knew that someone would be there to bail them out if things went badly.  That someone would be....you. 
You have their undying gratitude. 
Let us continue with the next verses:

When President Bush said in 2004 that Fannie Mae and Freddie Mac should be reined in, 76 members of the House of Representatives issued a statement to the contrary. These included Barney Frank, Nancy Pelosi, Maxine Waters and Charles Rangel.

If we are going to talk about "the policies that created this mess in the first place," let's at least get the facts straight and the names right.

The current policies of the Obama administration are a continuation of the same reckless policies that brought on the current economic problems-- all in the name of "change." Fannie Mae and Freddie Mac are still sacred cows in Washington, even though they have already required the biggest bailouts of all.

Why? Because they allow politicians to direct vast sums of money where it will do politicians the most good, either personally or in terms of buying votes in the next election.

The man has spoken.

Thus endeth the reading from The Gospel According To Saint Thomas.
You may be seated.

Unfortunately, the Richland Hills, Texas, City Planning Department hasn't taken any hits

From the U.S. Bureau of Labor Statistics:

We can now say that the stimulus plan has helped those that it was intended to help, right???

Texas is the #1 state for business in the U.S.A.

Once again, Texas is CNBC's  #1 state for business in the U.S. 

We are a right-to-work state with NO state income tax.   

You can go here to see the rankings.  Go here for CNBC's analysis of why Texas is #1. 

One puzzling sentence in the CNBC analysis....high wages hurt the state in the all-important Cost-of-Doing-Business category, where it comes in at number 30.

Let's repeat that.....high wages hurt the state in the all-important Cost-of-Doing-Business category, where it comes in at number 30.

Does this mean you don't have to be represented by the mafia or devote part of your paycheck to Democrat politicians in order to earn high wages?   How can we possibly have abnormally high wages as a right-to-work state? 

Could it be that individuals prosper most when they represent themselves instead of allowing....awwww, never mind. 

I've posted this before.  Here's some Ray Wylie Hubbard.  You can go ahead and fast-foward to the two-minute mark where the song gets crankin'.   

The Freedom Effect - Texas Style

Forbes has put out their list of the 10 Metropolitan areas where the recession is easing, but it's in one of those annoying formats where you have to hit "next" 10 times to see all 10 cities.  Go to this Newser summary of the rankings if you find that to be tiresome. 

Their formula takes into account projected job growth and housing prices. Here's the list:

1. (tie) Washington, DC-Arlington-Alexandria
2. (tie) Austin-Round Rock
3. Dallas-Fort Worth-Arlington
4. (tie) Minneapolis-St. Paul-Bloomington
5. (tie) Houston-Sugar Land-Baytown
6. Denver-Aurora
7. San Antonio
8. Boston-Cambridge-Quincy
9. Los Angeles-Long Beach-Santa Ana
10. Kansas City (Missouri and Kansas)

Skip this rant, since it doesn't really contribute to the argument in this post:  Seeing Washington D.C. ranked as the most recession-proof enclave on the planet should come as no surprise, since our system requires all the tax, stimulus, lobbying, porkulus, and kickback money to go there first so that our Lords and Masters can take their cut off the top.  Look at the huge pay increases given to Department Of Transportation employees, for instance.  The number of employees breaking the $170,000.00 per year barrier has increased by 1,680 % in just two years, while the rest of us struggle through a recession.  Nice, recession-proof work if you can get it. 

With a Statist Congress and The Teleprompter Jesus running the show, D.C.'s ranking at #1 is to be expected.  Ranking any other American cities with Washington is like comparing Chihuahua, Juarez, and Guadalajara, Mexico's financial well-being to that of the Sinaloa Drug Cartel. 

Now that we have that out of the way....

Tied for first is Austin/Round Rock, Texas. 
Next is Fort Worth/Arlington/Dallas, Texas.
Next (tied with the Minnesota Metroplex) is Houston/Baytown, Texas. 
Denver breaks up the Texas winning streak, and then you get....
San Antonio, Texas. 

Now let's hop over to Statepolicy.com, which ranks U.S. states by Fiscal Freedom, Regulatory Freedom,  and Personal Freedom.  You can hit the link to see the methodology used to rank each state. 

In the Fiscal Freedom category, which includes things like proper restraints on local government, a high ratio between private vs. public employee earnings, and low local taxes, Texas was ranked #4 in the nation. 

In the Regulatory Freedom category, which covers freedom from labor regulation, health insurance mandates, occupational licensing, eminent domain, the tort system, environmental regulation, and utilities, Texas was ranked at a shameful #27.   I suspect this is because some of our billionaires like to dabble in eminent domain schemes and monopolies via regulation.  This is a good subject for further research. 

This gives Texas an Economic Freedom score of  #7 in the nation.  

The next big category is personal freedom.  It can be summarized as the right to do what you want to do, just as long as you don't harm anyone else.  It includes everything from gambling, to alcohol regulation, bicycle helmet regulations, forfeiture laws, tobacco bans, gay marriage, fireworks regulation, gun control, and home schooling.  Texas came in at #5 on the personal freedom list. 

All of these ranking combine to give Texas a Freedom Index score of #5 in the nation. 
Colorado (home of Denver/Aurora on the list of Metro areas recovering from the recession) is  #2 on the Freedom Index. 
Missouri (home of Kansas City on the list above) is #6 on the Freedom Index. 

Boston and Los Angeles distort the curve, since Massachusetts and California are only #44 and #47 on the Freedom Index.  (I have no theory on why Boston, Massachusetts, is doing so well ; California doesn't matter since their state government will be bankrupt within two years.) 

This is still enough to show a nice, neat correlation between freedom and prosperity.  Here's one of the Heritage Foundation's graphs showing the correlation between freedom and per capita GDP.  What's good for the states is obviously good for the nations:

Note to everyone moving to Texas:  Welcome !  We're glad you're here.  But if you're a refugee from another state, trying to outrun the consequences of your votes, please repent.  We're doing well here because we're willing to leave each other alone.   

The Obama Logo FDR button

From the Von Mises blog:

....Logically, one might think that the best way to fix this mess (the recession) would be to liquidate the malinvestments of businesses, pay down our debts and start fresh; in other words, allow for the market to correct the imbalances and distortions created during the artificial boom.

But the enlightened Barack Obama and his team of trusty economic advisers, along with the ever-compliant Messrs Bernanke and Geithner, have other ideas. Practically every single policy they have enacted is intended to stop the market from clearing out the wastes and excesses of the boom.

The government has undertaken programs to keep people in homes and cars that they cannot afford, fictitiously propping up GDP numbers. It has bailed out failing enterprises; abrogated contractual obligations; created make-work, politically oriented, and naturally often fraudulent and wasteful public-works projects; and increased the money supply at an unprecedented rate, easing the Federal Reserve–controlled interest rate to a ridiculous 0 percent. Our representatives have done all of this while vastly expanding a national debt that was already egregious.""....There is a final point that must be made. Just as during FDR's presidency, market entrepreneurs (as opposed to the political ones, who profit from government swindling) are now genuinely afraid of this administration. People in business do not know how arbitrary or onerous future government regulations will be."

Regardless of what you think of their argument, you have to admit this much: That button is funny.

We Finally Had A Bad Quarter ! ! ! ! !

It finally arrived.

After years of encouragement from the media, after two years of Mommy Party (D) candidates talking about "the failed economic policies of the past eight years", and after at least a year and a half of false predictions.....

We've finally had our first long-awaited quarter of negative economic growth.

From July through September, the American economy contracted by 3/10ths of 1%. Yes, 3/10ths of 1%.

But we can't relax yet! It takes two quarters of negative growth to make a recession! So get out there and get busy! Talk some more about "the failed economic policies of the past eight years." Lay off some employees, and make that recession happen so we can....

Oh, wait a minute.

We're about to have a different president. A new script is called for.

Hide and watch. The media's coverage of the economy is about to change dramatically.

Phil Gramm Died For Your Sins, Part 2

I know this is a huge disappointment, but we're still not in a recession.
How can Obama run against the economic policies of Bush The Younger if we can't have a decent recession?

C'mon, folks. Stop spending. Stop producing. Lay off some employees.
The media has called for a recession, and we need to make it happen.

Otherwise, people are going to say that McCain advisor Phil Gramm was fired for telling the truth.
We can't let that happen.

The Recession Is Over ! ! !

The U.S. economy grew in the first quarter of 2008. That's what it did in the last quarter of 2007. The quarter we're in now is almost guaranteed to grow.

Despite all the media cheerleading for a recession, despite Alan Greenspan cheerleading for a recession (so his successor will look bad?), in spite of the Clintons' earnest prayers for a recession, the years 2000 through 2008 will probably be known to future historians as "The Bush Boom".

Libertarian types generally believe that the government should leave the economy alone. Just stay out of it. When government intervenes, they're postponing misery. When they manipulate interest rates, they're merely creating static, confusing the signals that the economy is trying to send. Any government action usually arrives too late to do any good, or is flat-out wrong.

Keynesian economists believe that government should be knee-deep, if not waist-deep, in the health of the economy. Government intervention is vital since only government can speedily and efficiently operate the appropriate levers of control.

The President and Congress recently passed legislation to give us tax rebates to get us through our recent non-recession, which has recently been declared "over".

If you're undecided on the libertarian vs. Keynesian points of view, let me ask some questions....

During which quarter of the recent non-recession (4th quarter 2007 or 1st quarter 2008) did you get your rebate check? Or have you gotten it at all?

Heh heh heh heh heh