Saturday, January 30, 2010

State of the Union Address: The Good ...

I looked forward to the State of the Union address this year because I was curious about what the President was going to say after the Democrats' loss of a Senate seat in Massachusetts marked the death, or at least a significant delay, of the health care reform legislation that President Obama had been pushing so hard for the last year. He had wanted the legislation to pass before the State of the Union address. Now, what would he talk about?

I found that President Obama said some things that I like, some that I didn't, and some things that were inappropriate. Therefore, I was going to write about the good, the bad, and the ugly, but I found out that saying everything I wanted to say about all three could lead to a blog post nearly as long as the speech itself, so I will just talk about the good this time.

Barack Obama is excellent at delivering speeches and as a politician is also excellent at saying things that people like to hear, including people that disagree with his policies. There are some things he has said over and over again that I agree with, but about which you have to doubt his sincerity because he says one thing and does another. Examples of things I keep hearing him say that I like but are contradicted by his actions are that he wants to be a “post-partisan” President and bring the parties together, that he wants to reduce the influence of lobbyists and special interests in government, and that he is willing to consider all ideas from whatever source.

President Obama has taken a step toward bipartisanship, but it wasn't until after the State of the Union address, and of course after he had been President for a little more than a year. He recently met with Republican members of the House of Representatives in Baltimore. Before that, he had rarely talked with anyone outside his own party. Apparently, he didn't see the need, considering that his party had a significant majority in the House and a “supermajority” of 60 Senators in the Senate. Because of a Senate rule that has existed nearly as long as the Senate itself, it takes a vote of 60 Senators to stop debate on a bill. Without the 60 votes, a minority can filibuster, which means to debate the bill endlessly so it never comes up for a vote. Technically, this means that if he can get all the Democrats to agree on a bill, the Republicans have no power whatsoever. That may work in theory, but in the real world, major legislation is rarely passed without bipartisan support. What the President didn't count on is that not all Democrats think exactly the same and that even without the need to compromise with Republicans, there remained the need to compromise among Democrats. President Obama originally wanted health care reform legislation to pass before the end of July. However, the process of compromising to get bills that got enough Democratic votes to pass delayed the process until Christmas Eve, when the Senate passed a bill similar to, but not identical with the one that the House had previously passed. Since the bills that the House and Senate pass have to be identical before they can become law, more compromise was needed to make them identical. More compromise meant more delay and the delay extended beyond the date of the special election in Massachusetts that deprived the Democrats of the filibuster-proof supermajority in the Senate. So now, to get any major legislation through Congress, the President is forced to do what he should have done voluntarily all along and negotiate with Republicans. If he or the Democratic leadership in Congress had negotiated with enough Republicans to get some of their votes, they probably would have health care reform legislation. Instead they played an all-or-nothing game and, at least so far, have gotten nothing.

As for reducing the influence of lobbyists and special interests, the President has placed several people who had been lobbyists in his cabinet and White House staff. Don't like lobbyists, Mr. President? Then why surround yourself with them? He also made a big deal about accepting ideas from whatever source. Specifically, regarding health care reform, he said that if anyone had any ideas that would make high quality health care more affordable and more available to more Americans without increasing deficits, he is ready to listen. No, he isn't! Several Republicans have suggested ideas that could do exactly that – make high quality health care more affordable and more available to more Americans without raising the deficit. Such ideas include (but are not limited to) tort reform (putting a limit on punitive damages that can be awarded in a medical malpractice suit) and allowing purchase of health insurance across state lines to promote competition and make more kinds of policies available to consumers. Tort reform is not going to happen in legislation that is passed only by Democrats because trial attorneys are one to the biggest sources of campaign contributions to the Democratic party. The President and others in his party may not agree with those ideas, but instead of saying so and arguing against them, they claim that the Republicans offer no ideas and are “the party of no.” I have a lot more to say about health care reform, but I will save that for the future and stay closer to the State of the Union address for now.

President Obama said other things in the State of the Union address that I liked and that surprised me because I had not heard him say them before. They included support for a new generation of safe, clean nuclear power plants, development of gas and oil offshore, and clean coal technology. He also supported biofuels, but I am undecided whether biofuels, such as ethanol and biodiesel, are a good thing or not. I have too much to say about energy to include in this post, so I will save that for the future. In any event, I would like to see some evidence that his unexpected support for nuclear energy, offshore drilling, and clean coal are serious or just words to appease independents. He also mentioned increasing trade with South Korea, Canada, and Colombia. Since the Congress has refused to ratify free trade agreements with South Korea and Colombia that were negotiated during the Bush administration, I'd say ratifying those free trade agreements is long overdue – and still not likely to happen. Since I work part-time for a community college, his support for revitalizing community colleges is in my personal best interest. However, I don't assume that what is in my best interest is also in the best interest of the American people. A lot depends on the details.

The President talked about cutting taxes on business to stimulate the economy and about tax cuts for the middle class. He would eliminate capital gains taxes on small businesses and providing tax incentives to businesses of all sizes for investments that would lead to hiring more employees or increasing wages. He talked about having tax cuts for the middle class, but when he started talking about specifics he talked about tax credits for raising children, going to college, buying a home, saving energy etc. It is good for taxes to go down, but lowering taxes by tax credits is using the tax code to influence people to behave in ways that the government wants them to behave rather than to raise revenue. It is one of the things that makes preparing tax returns such a chore and waste of time. If the government wants to lower taxes, it should just lower the rates. The tax code needs to made less complicated, not more complicated. Still, I suppose that a complicated plan for reducing taxes is better than none, so on balance I would say that his plan to reduce taxes on individuals and businesses so that businesses can employ more people and individuals have more money to live on is a good thing. However, compared with spending, taxes are a minor and short-term issue, because money that is spent has to be paid with either taxes or borrowing. Borrowing only postpone taxes; it does not replace them. That is the lead-in for the next discussion, the parts of the State of the Union address that were bad.

Sunday, January 24, 2010


Serendipity is running across something good that you weren't looking for.  For those of us whose political perspective tends to be conservative or libertarian, who would have thought that that would describe the election of Barack Obama as President of the United States, with the election at the same time of a House of Representatives that is overwhelmingly Democrat, and followed (since the election of Senator Al Franken was delayed for so long) with a filibuster-proof Senate majority?  As it turns out, it seems like the far left of the Democratic party has been unwittingly hanging themselves and the American voters had been furnishing them the rope to do it with.  A couple of months ago, Glenn Beck drew heat for remarking that it may have been a good thing for Barack Obama to be elected because the sudden lurch to the left woke Americans up as the slower drift to the left by electing John McCain would not have.  Now it appears that the substantial majorities that the Democrats had in both houses of Congress under the leftist leadership of Nancy Pelosi and Harry Reid has had a similar effect.  Both houses of Congress passed health care reform legislation that came within a hair's breadth of being foisted upon an American public that for the most part didn't really want it.  Even the voters of Massachusetts (hardly the most conservative lot in the country) woke up to what was happening and effectively killed the health care reform legislation by given a convincing victory to Scott Brown as their newest Senator in a special election to fill the seat held so long by Ted Kennedy.  That was a sign that the American public has heard the wakeup call.

Think about what would have happened if Al Franken had not been elected to give the Democrats their 60th vote in the Senate.  Obama, Pelosi, and Reid would still be determined to pass health care reform that slanted as far left as they could get away with.  However, lacking the 60 votes needed to break a filibuster in the Senate, they would have had to compromise to get a bipartisan bill and instead of having an atrocious bill that failed to become law, they would have had one nearly as bad that did become law.  The Democrats would also not have had to take complete ownership of terrible legislation and could share the blame.  As it turns out (for the period before Scott Brown's election in Massachusetts) by getting what they wanted from the voters, the left wing of the Democratic Party failed to get what it needed.  For everyone else, serendipity.

Monday, January 18, 2010

We Are Becoming Lawless Because of Too Many Laws

 Over 2300 years ago, Plato pointed out that not only are societies that have no laws lawless, but societies in which there are no limits on the laws that a government can establish are also lawless. In other words, a constitution that limits the government from passing arbitrary laws is necessary to prevent a country from degenerating into chaos or tyranny. The purpose of law is to punish behavior that a society considers bad and sometimes to reward good behavior. For law to be effective, citizens need to be able to understand what the law is. That is only possible if the law is relatively simple, slow to change, and any changes that occur are based on principles that are widely known and reasonably predictable. To the extent that laws are many, complex, subject to rapid change, and changes are arbitrary and unpredictable, it becomes more and more difficult to obey the law. What real difference is there between a society that is lawless because there are no laws to obey and a society that is lawless because the laws have become too arbitrary, unpredictable, complicated, and subject to rapid change to obey?

The economy suffers under either kind of lawlessness. Businesses will not invest and will not hire new workers when the future is impossible to predict. I think the fact that laws have become unpredictable is a major reason why the economy of the United States is as bad as it is today. Businesses both large and small are in shock and don't know what the future holds because many things that could not have predicted have happened in a very short period of time. Who could have predicted a couple of years ago that the government would own a controlling interest in two of the three American automobile companies? Who could have predicted that the government would ignore the bankruptcy laws that give bondholders preference when companies go bankrupt, as it did in the bankruptcies of General Motors and Chrysler? Who would want to buy corporate bonds or extend credit to companies when the government treats creditors as if they have no rights? The health care reform bill that may or may not soon be passed by Congress and signed by the President may have a substantial effect on how much it costs to hire a worker and provide health benefits. The cap and trade bill, which also may or not pass, could dramatically affect energy costs. Businesses need to know what their costs are. I predict that if it becomes clear that either the the health care reform bill or the cap and trade bill will not pass, the stock market indices will go up and the unemployment rate will go down, at least temporarily. That much is obvious, but I also predict that the stock market indices will go up and the unemployment rate will go down if either the health care reform bill or the cap and trade bill pass. Businesses may not like bad news, but they can handle it. What they can't handle is uncertainty. They are used to taking calculated risks, but when they can't calculate the risks, then they don't want to take them.

We and the people who represent us in the Congress and in state legislatures make the mistake of thinking of legislators as law makers. That means that they focus only on making new laws, which adds to the complexity of the laws and makes understanding the law almost impossible. They give very little attention to the laws that have already been passed. They need to be thought of not only as makers of new laws but as maintainers of a code of laws. In addition to making new laws, they should be repealing or modifying laws that have outlived their usefulness or never worked to begin with. They need to follow up on laws after they have been passed to see if the actual consequences of the laws match their intent. We need to understand what there role should be and try to encourage them to simplify things instead of making them more complicated. Since this Congress seriously considers passing laws that are over a thousand or two thousand pages long, it is obvious that they have not gotten that message. They need to avoid passing laws that can't be enforced because that promotes disrespect for the law, and they need to realize that the only law that enforces itself is the law of unintended consequences.

Sunday, January 03, 2010

Reactivating blog

Much has happened since the last year that convinces me that the United States of America is being transformed into something its founders would not recognize and that its current citizens may not recognize in a couple of decades.  For one thing, the levels of spending and debt are on an unsustainable course, as can been seen by examining the "debt clock at  What is really scary is not only the absolute debt, but how much debt there is per person.  The unfunded liabilities are even bigger than the official debt.  They represent the promises (such as for Social Security payments and Medicare coverage) that the government has made to spend money in the future that it has not collected money for.  This course cannot be sustained; something has to give.  I am worried about the future of our children and grandchildren who will be asked to pay for all the spending and borrowing and may not be able to.  I am also worried about the liberties that are being lost that citizens used to be able to take for granted.  There will be more about that in future posts.  What I hope to accomplish with this blog is to stimulate discussion about whether the United States can be saved and, if not, how to pick up the pieces and start again once the house of cards comes crashing down.  I am worried that the Constitution of the United States is losing its effectiveness because all three branches of government have been showing it little respect and because most American citizens are unaware of its contents and its importance.

Although readers of this post are encouraged to comment, the comments will not show up immediately because I have the blog set up so that comments are posted only after I moderate them.  I have set the blog up this way because of a prior experience in which inappropriate material appeared in a comment.  I will not bar a comment because the commenter disagrees with me, but I will bar it if is obscene, disrespectful, or otherwise inappropriate.