China: All Roads Lead to War

A nation that is on the road to war makes distinctly different choices than a nation that wants peace and prosperity. All of China's choices since 1989 (Tiananmen) have led away from private ownership and control, and toward larger, more powerful central state control. As a result, half of China's population has descended ever deeper into poverty, while the political sector and the politically connected groups have gained in wealth and control. All the while, China's military is working overtime to acquire the ability to project lethal (including nuclear) force over ever-larger parts of the globe.

The move towards an unbalanced state-led model did not occur by accident but was the result of deliberate policy. The Chinese reform experience can be divided broadly into two periods with the Tiananmen protests in 1989 constituting the dividing line. Prior to 1989, the spontaneous explosion of private initiative in rural China—fuelled by limited land reforms and unobstructed by officials—certainly propelled China closer towards a free-market model. Significantly, 80% of the poverty alleviation that occurred since 1979 was achieved during this period. But a top-down change away from nurturing the growth of the private sector is obvious when examining fixed asset investment measures before and after the ‘Tiananmen Interlude.’ From 1981–89, fixed asset investment by the private sector was growing at 20% per annum. During the ‘Tiananmen Interlude,’ it dropped to 2.6% and from 1993–2001 only rose 12.4% per annum. Private investment in rural China, which had been growing at above 19% prior to 1989, dropped to 1.1% during the ‘Tiananmen Interlude’ and averaged only 7.5% from 1993–2001.

...To put the situation in perspective, China’s overall use of capital is twice as inefficient as India’s when measured in terms of capital inputs used to produce additional output. In fact, World Bank findings indicated that about one-third of recent investments made generated zero or negative returns.(23) Given the regime’s need to continually stimulate the economy for political ends, it is no wonder loans keep on increasing at an incredible pace despite economic rationality demanding that it should not. This might further the end of maintaining loyalty to the ruling Party and entrenching its power, but it is at enormous cost to the country.

...The political imperative of retaining power severely impedes the building of the soft institutions needed for successful capitalism: enforceable property rights, independent courts and rule of law, independent financial and administrative organs. For example, the Property Rights Index released by the Heritage Foundation gives China a dismal score of 20 (which is the same rank as countries such as Bangladesh, Cambodia and Uzbekistan), while South Korea and Taiwan rate reasonably well at 70.(30) All land is still owned by the state although individuals may own and transfer long-term leases. But as the report observes, China’s judicial system is weak and even when courts try to enforce decisions regarding land rights, local officials ignore them with impunity. _CIS

As China continues to concentrate its wealth and power into the hands of a few well-connected individuals and groups, it becomes possible to envision the end-point of China's celebrated rise to global status. Either war or dissolution into warring fiefdoms. We all know which choice the CCP will make.

The CCP has been preparing for regional and quasi-global warfare for decades, as it enlarges its nuclear submarine fleet, its blue water navy, and expands land operations in Latin America, Africa, Western and Central Asia, and the Caribbean.

The CCP's economic squeeze will force it to make a choice. President Obama makes the dictatorship's choice a bit easier, as the American president continues to weaken America's ability to respond to global and regional threats. If Obama continues as US President a full 8 years in office, China's ability to defeat the US across several regions of the globe will be much better than at the present. Such is the calculus of war, for a country that appears to have few other choices.

To better understand why China's leadership has shut the country off from sustainable peaceful development along the lines of Japan, Taiwan, or South Korea, read the full CIS analysis linked above.

Obama's Policies Fail on the State Level -- Why Should They Succeed on the National Level?

California, New York, and New Jersey are already well along to instituting the policies that Obama wants to push onto the US taxpayer nationally. So how are they doing?

A decade ago all three states were among America's most prosperous. California was the unrivaled technology center of the globe. New York was its financial capital. New Jersey is the third wealthiest state in the nation after Connecticut and Massachusetts. All three are now suffering from devastating budget deficits as the bills for years of tax-and-spend governance come due.

These states have been models of "progressive" policies that are supposed to create wealth: high tax rates on the rich, lots of government "investments," heavy unionization and a large government role in health care.

Here's a rundown on the results:

Government spending as economic stimulus. State-local spending per capita is $12,505 in New York (second highest after Alaska), $10,136 per person in California (fourth) and $9,574 in New Jersey (seventh).

Has all this public sector "investment" translated into jobs? Not quite. California had the nation's third highest jobless rate in May (11.5%). New Jersey and New York had below average unemployment rates in May compared to the national average of 9.4%, but one reason is that so many discouraged workers have left those states. From 1998-2007, which included two booms on Wall Street, New York and New Jersey ranked 36th and 31st in job creation. From 2000 to 2007, the New Jersey Business & Industry Association calculates that nine out of 10 new Garden State jobs were in the government.

Soak the rich. Mr. Obama plans to pay for his government investments through higher tax rates on the top 1% and 2% of taxpayers. Our troika of liberal states are champions at soaking the rich. The state-local income tax burden, according to the Tax Foundation, is the highest in the nation in New York, second highest in California and sixth in New Jersey. New York City boasts the highest business tax rate, 17.6%, according to a study by the American Legislative Exchange Council. Seven of the 10 highest property tax counties in America are located in New Jersey.

Instead of balanced budgets, these high taxes have produced record red ink. California's deficit for 2010 is projected at $33.9 billion, New Jersey's $7 billion and New York's $17.9 billion, despite multiple tax increases this decade. The Manhattan Institute finds that three-quarters of the loss in revenues this year in Albany is a result of reduced income tax payments by rich people even though the state keeps raising taxes on high earners.

California's debt burden has multiplied so fast that it now has the worst bond rating of any state, and Governor Arnold Schwarzenegger and state legislators are pleading with Washington to command the other 49 states to pay off its IOUs. The interest rates on Golden State bonds have nearly tripled in the last two years.

Powerful unions. Mr. Obama believes union power is a ticket to the middle class. The middle class is getting creamed in all three of these "progressive" states, where organized labor is king. The unionized share of the workforce is 20% in California, 19% in New Jersey and 27% in New York compared to 13% across the country. All three are non-right-to-work states, have super-minimum wage requirements and provide among the nation's most generous public-employee pensions.

Workers in these paradises are indeed uniting -- by leaving. New York ranks first, California second and New Jersey third in moving vans leaving the state. A study by the National Institute for Labor Relations Research found that over the past decade these and other high-union states (mostly in the Northeast) had one-third the job growth of states with low union penetration.

Government health care. New York, New Jersey and California are among the leading states in government spending on and intervention into the medical market. A 2008 study by the Pacific Research Institute ranked the states on the basis of government regulation of health care and found that New York is most regulated, while New Jersey ranks sixth and California seventh. "New York," the report declares, "suffers from government health programs that are out of control, a grossly overregulated private insurance market and almost completely uncompetitive provider markets."

Have government controls and Medicaid expansions ("the public option") lowered costs? Here is what the American Health Insurance Plans found. For family coverage annual premiums in 2006-07, the national median cost was roughly $5,300; in California it was $5,884, in New Jersey $10,398, and in New York $12,254. New York's coverage mandates cause families to pay more than twice what they do in other states for insurance.

As a result, California and New York have more than one-third of their residents uninsured or in Medicaid -- much higher than the national average of 25%. More government involvement in health care in California, New Jersey and New York has raised costs and often reduced private coverage. That's hardly a model for the nation. _WSJ

Hardly a model for a rational nation, but perhaps precisely the model that Obamanation is looking for. Remember, a nation that is hurting is a nation growing more dependent on its government. It is hard for powerful rivals to grow out of the private sector, when the private sector is dead or dying, and the government is all that is left.

The only way these Obama-esque states stay alive is via political corruption, or federal bailout. Artificial insemination of vitality by sucking other regions dry through oppressive redistributive taxation and regulation.

On their own, California, New York, New Jersey, Michigan, Illinois, etc. would collapse under their own corruption and criminality in government. But Obama wants to bring that style of criminality to the highest levels of the federal government. And it is unlikely that he will let his biggest fans bite the dust.

In the long run, totalitarian economies do poorly compared to more open market economies. But in the short run, corrupt government officials can strip a private sector to the bone, and re-distribute the wealth to powerful political backers.

Unions, trial lawyers, eco-lobbyists, powerful progressive lobbying groups such as ACORN and PP etc. In a corrupt government, wealth flows out of the productive sector into the well-connected crony sector. This is what we are seeing under Obama / Pelosi.

Whitewashing China's Economic Problems.

Large numbers of investors and financial analysts have pinned their hopes for the global economy on China's back. The most polluting nation on Earth, one of the most dictatorial and most corrupt nations on the planet is being held up as the future of the planetary economic system.

But China's cheery economic numbers may be hiding a darker set of realities behind the bamboo curtain. Here is one critical look at China's economic situation that is worth a read. The Chinese economy may be in the middle of a huge financial bubble of its own.

China has been buying up commodities worldwide at a frantic pace -- trying to take advantage of bargain basement prices brought on by low global demand. This Chinese commodities "rally" has inflated the Baltic Dry Index and China's economic figures, but it may be on the verge of fizzling.

The emerging problem of toxic Chinese drywall sales to North America is likely to once again raise the issue of the Chinese Poison Train. Toxic products flowing out of Chinese enterprises into world marketplaces should have had a far worse impact on Chinese exports than they have done. Poor quality steel from Chinese foundries is another problem likely to come back to bite the dragon's tail.

The problem of excessive Chinese regulations and limitations on entry into the marketplace continue to give corrupt and inefficient State Owned Enterprises in China an unfair advantage over private enterprise. This corrupt inefficiency shows no sign of going away anytime soon.

The gullibility of those who take Chinese economic figures at face value is difficult to explain, outside of wishful thinking. Everyone is looking for the big score, and right now China seems to be the biggest score around. Wait and see.

Baby B-O's Brave New Ball and Chain for Children

It has taken Barak Obama less than 4 months as US President to cast an ugly pall over the American economic future of generations of children. Obama's record-breaking budget-busting spending spree has shackled future generations of American taxpayers with the ball and chain, with no end in sight.

Not since the second world war have so many governments borrowed so much so quickly or, collectively, been so heavily in hock. And today’s debt surge, unlike the wartime one, will not be temporary. Even after the recession ends few rich countries will be running budgets tight enough to stop their debt from rising further. Worse, today’s borrowing binge is taking place just before a slow-motion budget-bust caused by the pension and health-care costs of a greying population. By 2050 a third of the rich world’s population will be over 60. The demographic bill is likely to be ten times bigger than the fiscal cost of the financial crisis. _Economist

That's what makes Obama's profligacy so much worse than anyone could have imagined: the productive population of the US is shrinking at the very time when it is being saddled with incalculable debt.

....nothing sends a stronger signal than taking difficult decisions today. One priority is to raise the retirement age, which would boost tax revenues (as people work longer) and cut future pension costs. Many rich countries are already doing this, but they need to go further and faster. Another huge target is health care.....

All this is a tall order. Politicians have failed to control the costs of ageing populations for years. Paradoxically, the financial bust, by adding so much debt, may boost the chances of a breakthrough. If not, another financial catastrophe looms.

A tall order? Worse than that. An impossible order. Tackling social security, Medicare, out of control public sector pensions, etc. is more than the weak-spined politicians of the Obama era would care to take on.

The productive segment of society is growing old and retiring. New generations will lack the skills, the will -- and in some cases the aptitude -- to pick up the mantle of responsibility and productivity. In other words, there will be fewer and fewer skilled and productive workers to pull an ever-growing load.

What is Barak Obama's answer to the problems he is making worse every day? We don't really know, but since every day in Obama World is a campaign for something, we should be hearing from the Obama campaign on this topic real soon.

Meanwhile, in the background, the sound of printing presses rolls on into the long economic night.

Socialists Win Big in Sweden, Denmark, Greece

In the recent European elections, socialists (in red above) were winners in Sweden, Denmark, and Greece. In much of the rest of Europe, a different story unfolded.

* The anti-Islam campaigner Geert Wilders came in second in the Netherlands with 17% in the Netherlands on Thursday.
* The Hungarian anti-Gypsy extremist party Jobbik took three of the country’s 22 seats.
* In Austria two far-right parties mustered 18%.
* Extreme Slovak nationalists gained their first seat in the European parliament.
* “Eurosceptic” parties won more seats in Denmark, Finland, Austria, and the Czech Republic.

....* The leaders in France and Italy benefited from tough anti-immigration and law-and-order stances, despite the tabloid scandals of the private lives of both. _cominganarchy

As the Obama depression spreads to smother the economies of most of the developed world, the political fallout will be interesting to watch. Hope for the best, prepare for the worst.

Obama Prepares to Ascend to Heaven: "My Job Is Done, States the Messiah"

President Obama ascended to heaven from the Sultan Hassan Mosque in Cairo. In a final statement before departing his home planet, Obama apologised for the harm done to the world by previous US administrations. His last act as US President was to officially dissolve the United States.

"It's all one world now. I have done as much as I can, it is now up to you. If you want nuclear weapons, there is no one left to stop you. If you want to destroy all the Zionist states in the world, who is to say you can't? The economies of all the European governments around the world are now as good as dead. My job is done. Good-bye."

Hillary Clinton -- who was present at the ascension -- was initially too flabbergasted to speak. After 30 seconds she recovered, however, and spoke into the microphone -- despite the lack of a teleprompter (the ascended president's teleprompter had ascended with him).

"I am now in control," the Secretary of State declared. "I am now carrying the football, and Air Force One is right here. From that airplane I could order the destruction of the entire world," she glanced around quickly on hearing angry shouts from Iman Abdel Fateh and Dr. Zahi Hawass who were also in attendance at the mosque.

"Oh don't worry, Imam! I'm not going to destroy anybody! I just want the people back home to understand that they still have to pay their taxes and obey the speed limits and all. Barack's ascension doesn't change a thing as far as how the US government does its job back home. Despite what Barack said to the European press, the US isn't really a Muslim country you know."

After her speech, Mrs. Clinton was hustled away by secret service agents to Air Force One, where a quick conference call was set up with Nancy Pelosi and Barbara Boxer to line up US Congressional support behind Mrs. Clinton's unorthodox succession to power. There are rumours that Ms. Pelosi was implementing plans of her own for an end run to the presidency. News sources are remaining mum on the negotiations thus far.

Meanwhile, Joe Biden was last seen hurrying to an underground bunker in an undisclosed location. According to secret service agents on the scene, Mr. Biden was complaining -- to no one in particular -- mumbling under his breath ... "Barack gets ascended and I'm stuck in an underground bunker? What am I, chopped liver? I'm mad as hell and I'm not going to take this!"

When asked if he wanted to stick around and possibly get caught between Nancy Pelosi and Hillary Clinton in an all-out war, Mr. Biden acquiesced, and was led quietly awy to his bunker.

The Financial Bubble: 10 Causes

The following 10 thoughts on the causes of the ongoing US financial bubble-burst are re-printed from The American Spectator:

1. "When it comes to the home mortgage boom and bust, who was to blame? The borrowers? The lenders? The government? The financial markets? The answer is yes. All were responsible." (Thomas Sowell, The Housing Boom and Bust, 2009.) This seems fair.

2. Not explanatory of the problems are "greed" and "no regulation." Greed is a constant, always with us as part of human nature. As for "no regulation," the highly regulated commercial banks and the highly regulated thrifts are deeply enmired in the swamp of the bust, just as they have been many times in the past, constant regulation notwithstanding.

3. Economic and financial cycles are natural and cannot be avoided. The bubble was an exaggerated cycle. Various government actions contributed to making it worse:

• Fannie Mae and Freddie Mac, a government-sponsored duopoly, were made into huge points of concentrated vulnerability to failure, which then indeed failed. They significantly inflated the housing bubble though their huge entry into high risk mortgages right at the top of the market -- financed, of course, with government-guaranteed debt, so that the buyers of their debt did not have to ask about the soundness of their asset expansion. (See paragraph on trade deficit and China below.) This risky strategy was encouraged by politicians and by HUD's "affordable housing goals."

• The "Greenspan Gamble," which was intentionally to ignite and feed a housing boom to offset the deflationary effects of the tech stock crash, succeeded too well. Instead of a mere housing and mortgage boom, we got the bubble.

• The dominant rating agencies, a government-sponsored duopoly, were made by regulation into concentrated points of vulnerability to failure, which then failed, when their high credit ratings of MBS built from risky mortgages did not include anything resembling the downside case which became reality.

• Politicians all cheered rising home ownership rates and "creative" mortgage financing, which simply meant riskier financing.

4. There was a "logical" very widespread belief that house prices could not fall on a national basis. "Average U.S. house prices rarely fall from one year to the next. Bankers, brokers, appraisers, loan servicers, mortgage investors, homeowners and the designers and promoters of collateralized debt obligations all attest to the truth of this assertion… 'History is definitive,' pronounced the American Banker, 'the national average price of a home may remain flat for a number of years, but it doesn't fall.'" (James Grant, Mr. Market Miscalculates, 2008.)

Mortgage professionals were well aware of many instances of regional housing and mortgage busts, with falling house prices and high defaults and losses. But it was thought that this would not, and perhaps could not, happen on a national average basis. This firm belief by almost all parties made it possible for the belief to be false, in the paradoxical way of financial markets.

5. The market and the regulators became enamored with statistical treatments of risk. But: "The model works until it doesn't." (Moore's Law of Finance)

Human sources of risk are old-fashioned: short memories, the inclination to convince ourselves that we are experiencing "innovation" when what is happening is lowering credit standards, optimism, speculation which is successful in the early bubble stages, gullibility, group psychology.

6. "The good times of too high price almost always engender much fraud. All people are most credulous when they are most happy." (Walter Bagehot, Lombard Street, 1873.) True then, true now, unfortunately.

7. Highly leveraged financial systems are bound to have panics and busts from time to time. Increasing leverage of households was promoted by lenders and the government to create "affordable loans," with both higher LTV ratios and higher debt to income ratios. Financial firms were highly leveraged. Financial engineering produced highly leveraged structures, including CDOs, SPVs, CDOs-squared. Banks are able to be highly leveraged because of government deposit insurance, and have created balance sheets heavily concentrated in real estate risk. The entire macro economy became more highly leveraged, with record debt to GDP ratios, the "Big Balance Sheet Economy." Leverage always feels good when things are going up.

The "Great Moderation," of which the world's central bankers were so proud, created the conditions in which increased leverage seemed successful, thereby also creating the conditions for the bubble and bust. "Stability creates instability." (Epigram of Hyman P. Minsky's "financial fragility" theory.)

On the way down, needless to say, the leverage is more than painful.

8. The large and persistent U.S. trade deficit was financed by a build-up of debt, notably with China, but also with other countries. An important part of the debt was held in obligations of Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, because these were viewed as U.S. government risk (as indeed they were, as proved by events). But it meant that the trade deficit was thus directing credit expansion to housing. Chinese savings became high U.S. house prices.

There seems to be an interesting analogy of the oil boom of the 1970s with consequent LDC ("less developed countries") credit collapse of the 1980s, to the Chinese export boom and consequent housing collapse of the 2000s. People were very proud in the first instance of "petro-dollar recycling," and in the second of "record home ownership." Consider:

• Oil went from OPEC, which put the proceeds into U.S. banks, which made loans to LDCs, which later defaulted.

• Goods went from China, which put the proceeds into U.S. debt securities, which financed mortgage loans, which later defaulted.

9. So-called "fair value" accounting, pushed by the SEC and its helper, the FASB, made the panic and the bust worse. So did pressure from both these bodies to constrain the build-up of the necessary loan loss reserves in good times.

10. "The most common beginning of disaster was a sense of security." (Velleius Paterculus, History of Rome, c. 30 AD)

In summary, overconfident investors, bankers, and government budgeters overspent and overleveraged their way into far more risk than they were prepared to acknowledge, or deal with.

The unexpected collapse of this hyper-leveraged bubble paved the way for the emplacement of a government of wastrels that is preparing to amplify the economic destruction by at least an order of magnitude.

Talk of economic recovery other than on a local or regional scale, is highly premature and misleading. Brocko Bomba, clown of clowns, is in the driver's seat. The train is on the downslope, accelerating rapidly. Either jump, pull the emergency brake, or prepare for a wild ride with an unhappy ending.

Obamacabre for All! No Choice Medicine

Whether termed "Obamacare" or "Obamacabre", no-choice medical care is apt to turn into something quite monstrous in the US under this president and this congress. When Americans are told they have no choice about something, they tend to rebel. How will they react when the macabre reality of Obama's grand plan for America really sets in? Obamacabre is just the middle of the beginning.

...any even remotely aware consumer of health care services has got to realize that the Democrats are on the verge of a massive destruction of the American medicine delivery system. There are problems in health insurance cost and coverage, but not in the quality of care and the innovation instinct, and the Democrats are going to kill the latter in the fruitless quest for improvements to the former. The "government option" is the biggest threat of all, a thinly digusied lurch to Canada-style single payor with the hidden (and increasingly not-so-hidden) rationing and lousy care that canada provides its people with complex diseases and conditions. _HughHewitt

The US is far more diverse than any of the European and quasi-European countries where universal single-payor medical care has been instituted. Americans are already deeply in debt to Medicare -- "the other single payor medical care." Now Obama promises to "fix Medicare" by expanding the failure to include every American? Good luck with that.

Wouldn't it be ironic if the only way to opt out of Obamacabre were to become a government worker? Government worker pensions allow government workers to bypass the social security system. Government worker health care plans can allow gov workers to bypass Obamacabre.

Of course if you are one of the hundreds of millions of Americans in thrall to the government-media-academia-union-trial lawyer-faux environmentalist complex, you will be saying "there is no problem here."

But if you are one of the dwindling numbers of thinking, well-educated Americans who sees Obamacabre as only one of the monsters being spawned by the nest of the incompetencies currently ensconced along the Potomac River, you may begin to consider the John Galt approach to reforming an untamed government. Or you may consider this.

Apparently the "Tea Party" movement forgot to surrender to government and media scorn, and grassroots individuals continue to protest a regime that is growing into a monstrous reich. July 4, 2009 is apt to be an interesting date in that regard.

Government workers, union bosses, faux environmentalists, community activists, and media flacks are quite happy with what the Obamanation is becoming. But small business owners and other members of the productive class who depend upon a wise and impartial government to take a mostly "hands-off" to the daily workings of a real life economy, are beginning to see storm clouds gathering.

Divisions are deep and growing deeper. When a nation's productive classes are the losers in such a quasi-"civil war", the entire nation loses. The parasites win. If anyone truly believes that Obamacabre, or Obamacare, or any other type of no-choice medical care is going to solve that problem, they deserve their fate.

Previously posted at Al Fin

Brocko Bombba Nuka Bombas US Economy

Something odd is happening with the wholesale closing of Chrysler dealerships. It seems that all the dealerships who are closing had connections with either Republicans or other political enemies of Obama. The only Obama donour whose dealership is closing is a piker from Texas who only gave the narcissist-in-chief $200. Maybe he'll learn to be more generous next time.

Consider the partial list of Chrysler dealership owners, listed below. You'll notice that all were opponents of Barack Obama, most through sponsorship of GOP candidates and organizations, but a handful through Barack's Democrat rivals (Hillary Clinton and John Edwards in 2008, for example).

• Vernon G. Buchanan: $147,450 to GOP candidates and organizations
• Wallace D. Alley and Family: $4,500 to GOP.
• Robert Archer: $4,600 to GOP and conservative causes.
• Homer S. Higginbotham and Family: $2950 to GOP.
• James Auffenberg and Family: $28,000 to GOP; $6,000 to one Democrat candidate.
• Michael Maroone and Family: $60,000 to GOP; $8,500 to two Democrat candidates.
• Jerome Fader: $6,500 to Democrats; $2,500 to Independent Joe Lieberman.
• Stephen Fay and Family: $13,500 to GOP.
• William Numrich: $20,000 to GOP.
• Robert Carver: $10,000 to Democrats including $1,950 to Hillary Clinton, nothing to Barack Obama.

• Robert and Linda Rohrman: $24,000 to GOP.
• Frank Boucher, Jr. and Family: $18,000 to GOP, $1,000 to one Democrat candidate.
• Scott Bossier: $4,300 to GOP.
• Todd Reardon: $17,000 to GOP; $2,000 to one Democrat candidate.
• Russ Darrow and Family: $78,000 to GOP.
• Bradford Deery and Family: $24,700 to GOP.
• Charles Gabus and Family: $30,000 to GOP.
• Brian Smith: $15,500 to GOP.
• Michael Schlossman: $14,000 to GOP; $14,000 to three Democrats ($12,500 to Sen. Russ Feingold).
• Don Hill: $11,000 to GOP; $12,800 to conservative incumbent Rep. Heath Shuler.

• Don Miller: $2,000 to GOP; $1,000 to Feingold.
• Eddie Cordes: $2,150 to GOP.
• Robert Edwards: $1,100 to GOP.
• James Crowley: $19,100 to GOP.
• Stanley Graff: $2,200 to John Edwards (2008 Presidential Run); $500 to GOP.
• John Stewart: $10,500 to GOP.
• John Fitzgerald and Family: $4,600 to John McCain (2008); $2,000 to Hillary Clinton (2008); nothing to Barack Obama.
• William Churchill and Family: $3,500 to GOP.
• Thomas Ganley: $9.450 to GOP.
• Gary Miller: $20,000 to GOP.

• Kevin and Gene Beltz: $18,500 to GOP.
• Arthur Grayson: $14,000 to GOP.
• Eric Grubbs and Family: $26,000 to GOP.
• Michael Leep and Family: $19,500 to GOP; $4,800 to three Democrats including Sen. Evan Bayh.
• Harry Green, Jr.: $10,000 to GOP.
• Ronald Hoover: $5,250 to GOP.
• Ray Huffines and Family: $18,500 to GOP.
• John O. Stevenson: $1,500 to GOP.
• James Marsh: $8,200 to GOP.
• Max Pearson and Family: $112,000 to GOP.

I have thus far found only a single Obama donor (and a minor one at that: $200 from Jeffrey Hunter of Waco, Texas) on the closing list. _DR

Brocko Bombba is a vengeful piece of political egocentrism. Pay close attention to those who attempt to ingratiate themselves to Obama the clown. The pendulum will swing, simply because the current level of corruption is unsustainable.

A Demographic Wave of Cold Water to the Face

Anyone who has not been hiring young Asians has no clue how cultured and curious they are. Their American counterparts have seen life as a perpetual spring break interrupted by brief episodes of work, and are simply in no shape to compete. Spengler Goldman

It is easy to see how the psychology of the US economy changed as soon as it was obvious that Obama was likely to be the next US President. The stock market was the first to slide, but the rest of the US economy began to slump almost immediately. The graph below shows how quickly Obama has moved to turn a cyclic recession into a semi-permanent depression via wholesale corrupt spending and policy.But you knew all that. Here is the bad news: in terms of numbers, the talent that will be needed to build a new prosperity does not exist on the American or European shores. No, the talent in terms of numbers, is in Asia.

Wealth comes from sweat and smarts. Here’s factoid for you: China has 60 million elementary and secondary school students studying piano or orchestral instruments and playing classical music. America has 30 million students, total. China has classical music students at twice the number of all American students waiting in the pipeline to join the job market. Add to these the smart Indian kids who will be graduating from India’s technical institutes with the world’s sharpest math skills, and it seems likely that during the next five or ten years, a good 75% of the best-qualified job market entrants will come from China and India. ...

...If you are a smart Chinese or Indian entrepreneur, are you likely to get richer by moving to the US or by staying at home? Emerging market equities are a far more interesting proposition than the US stock market under Emperor Obama I. Bonus restrictions? Compensation caps? They never heard of them in Mumbai or Shanghai.

America isn’t getting the immigrants any more, that is, the top-of-the-line human capital. As China reorients its economy towards domestic spending, America won’t get the capital, either. America isn’t going to crash. Unless it changes course, it will slowly sink into the mud, like England did during the 20th century.

Equity investment is worth considering in China and India. China’s doing a great job of providing a serious stimulus, and India’s Congress Party victory puts a very qualified Prime Minister into power. It’s a snooze here in the Republic of Zombies. _Spengler Goldman

By zombies, Spengler Goldman refers to the Obama Zombies, the total morons who elected the naked Messiah and who continue to back his suicidal policies. These zombies -- whether in the media, academia, financial industries, or ethnic ghettoes guarantee the continuous decline of the US economic future.

Asia has the talent, and talented Asians still have the hunger to build, create, and transform.

Balochistan Forever!

Balochistan is another "phantom stan", along with Kurdistan and Pushtunistan. Before the days of the United Nations and fixed national borders, we had tribes and tribal areas of control. As the strength of the tribe ebbed and flowed, its area of control would expand and contract -- like a beating heart. Observe B-stan, in the middle of Pakistan, Afghanistan, and Iran. And yet Balochistan has no UN representative, no army, navy, diplomatic service. Just like Kurdistan and Pushtunistan. But B-stan is considered important in the halls of power, like the other phantom stans.

Strategically, Balochistan is mouth-watering: east of Iran, south of Afghanistan, and boasting three Arabian sea ports, including Gwadar, practically at the mouth of the Strait of Hormuz.

Gwadar - a port built by China - is the absolute key. It is the essential node in the crucial, ongoing, and still virtual Pipelineistan war between IPI and TAPI. IPI is the Iran-Pakistan-India pipeline, also known as the "peace pipeline", which is planned to cross from Iranian to Pakistani Balochistan - an anathema to Washington. TAPI is the perennially troubled, US-backed Turkmenistan-Afghanistan-Pakistan-India pipeline, which is planned to cross western Afghanistan via Herat and branch out to Kandahar and Gwadar.

Washington's dream scenario is Gwadar as the new Dubai - while China would need Gwadar as a port and also as a base for pumping gas via a long pipeline to China. One way or another, it will all depend on local grievances being taken very seriously. Islamabad pays a pittance in royalties for the Balochis, and development aid is negligible; Balochistan is treated as a backwater. Gwadar as the new Dubai would not necessarily mean local Balochis benefiting from the boom; in many cases they could even be stripped of their local land.

To top it all, there's the New Great Game in Eurasia fact that Pakistan is a key pivot to both NATO and the Shanghai Cooperation Organization (SCO), of which Pakistan is an observer. So whoever "wins" Balochistan incorporates Pakistan as a key transit corridor to either Iranian gas from the monster South Pars field or a great deal of the Caspian wealth of "gas republic" Turkmenistan.
_ATimes

Pepe "the punk" Escobar envisions Baluchistan as the object of another US expeditionary force, led by Barak Obama. Of course, Escobar is not thinking clearly, which is more the norm than not it seems. And yet, such visions are useful for writers of pulp fiction and journalists of minimal realism. Something to think about when you are high, and lacking in anything important to discuss or cogitate upon.

The serious fact is the state of the tribal areas of the planet -- unstable. From Africa to Asia to parts of South America and the Pacific, the thought of tribal insurgencies can ruin the digestions of many a regional and global leader.

Will we ever see a nation called Balochistan? Probably not of any consequence. And yet, some very pivotal battles over access to energy may happen not far from B-stan. China is there. Pakistan is there. Iran is there. The US and NATO are not actually that far away.

Whether Pepe the punk is correct about the future of B-stan has more to do with the incompetence of Obama than anything else. Only a very incompetent Obama could make Escobar's paranoid visions come true.

Illegitimate Births Double in Japan and US!

Yes, between 1980 and 2007, illegitimate births in both Japan and the US have approximately doubled. Specifically, unwed births in Japan went from 1% to 2%, and in the US from 18% to 40%. The percentages roughly doubled in both countries, but of course the raw numbers (and raw impact) is much higher in the US. But if you think the US has a high percent of bastards, check out Europe:

Increases were much more dramatic in the other countries, with Italy rising from 4 percent to 21 percent, Ireland from 5 percent to 33 percent, Canada from 13 to 30 percent, and the United Kingdom from 12 percent to 44 percent.

...Iceland is the leader with 6 in 10 births occurring among unmarried women. About half of all births in Sweden and Norway are to unwed moms, while in the U.S., it's about 40 percent.

France, Denmark and the United Kingdom also have higher percentages than the United States, according to the report from the U.S. Centers for Disease Control and Prevention. _Sourcevia_NewsAlert

Within the US, percentage of bastard births in the black population is 70%, and among hispanics over 50%. What kind of future will these children born without fathers into poverty and (probably) low IQ experience?

You are correct. Someone has to support employment in law enforcement, prisons, and the court system.

People Everywhere Just Got To Be Free

If a specimen of homo sapiens is not free to succeed or fail on his own merits, that specimen is not human. In that sense, Mark Steyn thinks the US is heading in the direction of non-humanity. Steyn's essay "Live Free or Die" speaks to this disturbing trend across America:

In most of the developed world, the state has gradually annexed all the responsibilities of adulthood—health care, child care, care of the elderly—to the point where it's effectively severed its citizens from humanity's primal instincts, not least the survival instinct. Hillary Rodham Clinton said it takes a village to raise a child. It's supposedly an African proverb—there is no record of anyone in Africa ever using this proverb, but let that pass. P.J. O'Rourke summed up that book superbly: It takes a village to raise a child. The government is the village, and you're the child. Oh, and by the way, even if it did take a village to raise a child, I wouldn't want it to be an African village. If you fly over West Africa at night, the lights form one giant coastal megalopolis: Not even Africans regard the African village as a useful societal model. But nor is the European village. Europe's addiction to big government, unaffordable entitlements, cradle-to-grave welfare, and a dependence on mass immigration needed to sustain it has become an existential threat to some of the oldest nation-states in the world.

And now the last holdout, the United States, is embarking on the same grim path: After the President unveiled his budget, I heard Americans complain, oh, it's another Jimmy Carter, or LBJ's Great Society, or the new New Deal. You should be so lucky. Those nickel-and-dime comparisons barely begin to encompass the wholesale Europeanization that's underway. The 44th president's multi-trillion-dollar budget, the first of many, adds more to the national debt than all the previous 43 presidents combined, from George Washington to George Dubya. The President wants Europeanized health care, Europeanized daycare, Europeanized education, and, as the Europeans have discovered, even with Europeanized tax rates you can't make that math add up. In Sweden, state spending accounts for 54% of GDP. In America, it was 34%—ten years ago. Today, it's about 40%. In four years' time, that number will be trending very Swede-like.

But forget the money, the deficit, the debt, the big numbers with the 12 zeroes on the end of them. So-called fiscal conservatives often miss the point. The problem isn't the cost. These programs would still be wrong even if Bill Gates wrote a check to cover them each month. They're wrong because they deform the relationship between the citizen and the state. Even if there were no financial consequences, the moral and even spiritual consequences would still be fatal. That's the stage where Europe is.

America is just beginning this process. I looked at the rankings in Freedom in the 50 States published by George Mason University last month. New Hampshire came in Number One, the Freest State in the Nation, which all but certainly makes it the freest jurisdiction in the Western world. Which kind of depressed me. Because the Granite State feels less free to me than it did when I moved there, and you always hope there's somewhere else out there just in case things go belly up and you have to hit the road. And way down at the bottom in the last five places were Maryland, California, Rhode Island, New Jersey, and the least free state in the Union by some distance, New York.

New York! How does the song go? "If you can make it there, you'll make it anywhere!" If you can make it there, you're some kind of genius. "This is the worst fiscal downturn since the Great Depression," announced Governor Paterson a few weeks ago. So what's he doing? He's bringing in the biggest tax hike in New York history. If you can make it there, he can take it there—via state tax, sales tax, municipal tax, a doubled beer tax, a tax on clothing, a tax on cab rides, an "iTunes tax," a tax on haircuts, 137 new tax hikes in all. Call 1-800-I-HEART-NEW-YORK today and order your new package of state tax forms, for just $199.99, plus the 12% tax on tax forms and the 4% tax form application fee partially refundable upon payment of the 7.5% tax filing tax. If you can make it there, you'll certainly have no difficulty making it in Tajikistan.

New York, California... These are the great iconic American states, the ones we foreigners have heard of. To a penniless immigrant called Arnold Schwarzenegger, California was a land of plenty. Now Arnold is an immigrant of plenty in a penniless land: That's not an improvement. One of his predecessors as governor of California, Ronald Reagan, famously said, "We are a nation that has a government, not the other way around." In California, it's now the other way around: California is increasingly a government that has a state. And it is still in the early stages of the process. California has thirtysomething million people. The Province of Quebec has seven million people. Yet California and Quebec have roughly the same number of government workers. "There is a great deal of ruin in a nation," said Adam Smith, and America still has a long way to go. But it's better to jump off the train as you're leaving the station and it's still picking up speed than when it's roaring down the track and you realize you've got a one-way ticket on the Oblivion Express. _ Imprimis PDF

Imagine a world without a free country anywhere. This is the world that Obama is bringing in his messianic wake. If you have any alternative ideas, you had best start developing them now.

Obama vs. Godzilla: Is He Up For It?

The global derivatives bubble is at roughly $700 trillion, with the US' share roughly at $200 trillion (PDF).

Obama's first federal budget will be roughly $3 trillion, with almost $2 trillion of that provided by "imaginary wealth." Expect similar or larger deficits and budgets for every year that Obama is narcissist in chief. Obama is determined to prop up the millionaire / billionaire bankers, investors, and speculators who financed his campaign. Obama is willing and eager to joust the windmill of a monstrous investment bubble using the entire country as collateral. And make no mistake, Obama sees himself as the hope of the world -- not just the US.

How long can Obama keep up this charade? The old media is certainly behind the clown prince, providing smoke screens to obscure his gaffs and providing a loud cheering section to celebrate his "triumphs." But the new media is divided between the zombie pro-Obama crowd, and a growing number of disillusioned and skeptical thinkers.

Obama will double the US national debt in just a few years. Financial catastrophe is now all but certain, thanks to this incompetent boob. Anyone who has reason to believe that he will be adversely affected by the collapse of the US economy should perhaps be making contingency plans.

Hyper-Inflation: The Cure that Kills

Obama's $2 trillion deficit for the coming fiscal year budget is just the beginning of the exponential growth of deficit spending and a rapid and repetitive doubling of the national debt over a short period of time. Hyper inflation will be hardest on the elderly and others on fixed budgets. Obama had to destroy social security in order to save it -- except nothing is being saved.

With an unprecedented deficit that’s approaching $2 trillion, this budget proposal is a surefire prescription for hyperinflation. So every senator and representative who votes for this monster $3.6 trillion budget will be endorsing a spending spree that could very well turn America into the next Weimar Republic. For those too young to remember, that was the period in Germany in the years between the two world wars when people needed wheelbarrows full of money to buy a loaf of bread.

In a 1993 interview, Harvard University law professor Friedrich Kessler offered a chilling portrait of the Weimar Republic: “It was horrible. Horrible! Like lightning it struck. No one was prepared. The shelves in the grocery store were empty. You could buy nothing with your paper money.”

Thanks to the expanding profligacy on Capitol Hill, a version of such economic hell will likely happen here, according to two prominent economists. Johns Hopkins University professor Steve Hanke notes that the Federal Reserve’s balance sheet “has more than doubled in size since August. Unless the Fed shrinks its balance sheet,” he warns, “... inflation will roar back with a vengeance.” _SFExaminer

Behind the egocentric and narcissistic solipsist, is anyone at home? Hello?

Academic Indoctrination -- Obama Wants More

The University of Delaware program to brainwash its students into mindless leftist dogma may be lying dormant, temporarily. But Obama wants to expand the program to high schools -- to create his own National Service Corps of brown-shirted Nazi Youth like zombie minions. In order the be sure that these "Red Guard" lookalikes have gotten their minds right, Obama will instruct them all to undergo consciousness training.

And why not? These youth have very little future, once Obama has made mincemeat out of the economy for the next 50 years. May as well march to the drummer that pays that government check, eh?

French Unions form Gangs to Victimise Citizens

Redundancy plans have caused violent protests in private sector companies, left-wing students have blocked universities and unions are planning a demonstration on Labour Day. “There is a risk of revolution,” Dominique de Villepin, the former prime minister, said. _TimesOnline

In France, striking labour unions are forming gangs to terrorize French citizens into submission. Cutting off power and gas to neighborhoods already at risk from ethnic and religious violence, French labour unions are hoping to push France over the edge into outright insurrection. Union leaders hope that such violence will convince the government that the unions are too big to discipline.

At an electricity substation on a bleak industrial estate north of Paris a masked union militant is preparing to deprive a neighbourhood of power.

His colleague is outside, dragging nervously on a roll-up cigarette while keeping a lookout for police or security guards. “Get a move on,” he says. “And then let’s get out of here.”

A switch is pulled down, the door of the sabotaged transformer is locked and the two activists — employees of EDF, the French state electricity supplier — drive off.

....It was the second time in a week that blackouts had hit the Paris region as striking gas and electricity workers adopted radical tactics to support their call for a 10 per cent pay rise and an end to outsourcing of jobs.

They are denounced as industrial saboteurs by the Government and face disciplinary action and prosecution, but say they are determined to press ahead with what they portray as a struggle against free-market forces.... _TimesOnline

In Germany, the threat of revolution is more subdued. Potential gangs are waiting for the other shoe to drop -- waiting to see what happens when the second stage of bad loans hits the financial sector of Germany and Europe.

A clutch of political and labour leaders in Germany have raised the spectre of civil unrest after the country's leading institutes forecast a 6pc contraction of gross domestic product this year, a slump reminiscent of 1931 and bad enough to drive unemployment to 4.7m by 2010.

...Michael Sommer, leader of the DGB trade union federation, called the latest wave of sackings a "declaration of war" against Germany's workers. "Social unrest can no longer be ruled out," he said.

Gesine Swann, presidential candidate for the Social Democrats, said "the mood could turn explosive" over the next three months unless the government takes drastic action.

While authorities have belatedly agreed to create a "bad bank" to absorb toxic loans and stabilise the credit system, further financial troubles are almost certainly in the pipeline.

Swiss risk advisers Independent Credit View said a "second wave" of debt stress is likely to hit the UK and Europe this year as the turmoil moves from mortgage securities to old-fashioned bank loans. A detailed "stress test" of 17 lenders worldwide found that European banks have much lower reserve cushions than US banks, leaving them acutely vulnerable to the coming phase of rising defaults. _Telegraph

Of course, in third world countries -- even relatively prosperous ones such as Jamaica -- there is no pretense of order. When the government declares a tax hike, they call out the army in advance to suppress violence by any means necessary. I think I'll cancel that weekend in Jamaica I had planned for next month.

Meanwhile, in nearby Mexico, swine flue threatens to upset the ongoing status quo of corruption and drug cartel warfare. Riding a wave of human immigrants to el norte, the flu is starting to spread to the US, along with the drug cartel violence.

Hope and change in the world of the Obama / Pelosi reich. It may come down to a question of the last man standing.

Obama "Feels the Terrorists' Pain"

President Clinton was famous for the ability to feel the pain of ordinary Americans -- and to remind them of this facility at every opportunity. President Obama is even more sensitive than President Clinton, with the ability to feel the pain of terrorists and anti-American dictators around the world. When not bowing to dictators, he is laughing at their anti-American jokes and accepting their gifts of anti-American propaganda. And still he has time to leak top-secret memos describing harsh interrogation techniques that reaped plentiful high-value information from proved terrorists. He is making sure America can never obtain such high-value information from terrorists ever again -- at least during his reich. Because he feels the terrorists' pain, so that when the terrorists hurt, Obama hurts.

The release of the memoranda means that we are unlikely ever again to get valuable information from terror suspects, because now our enemies know the precise lengths to which our interrogators are willing to go to coerce information, and that those limits stop well short of actually causing the terror suspect injury. _JWR

The interrogation techniques did not exactly involve "pain", as such. There was plenty of psychological stress involved, with the threat of pain and injury. But clearly the word "torture" may not actually mean what Herr Obama thinks it means.

Take the insect “torture.” Specifically designed for al-Qaeda operative Abu Zubaydah, a confidant of Osama bin Laden’s with a fear of spiders, it involved placing Zubaydah in a “cramped confinement box” with an ostensibly stinging insect. Except that the insect would actually be harmless caterpillar. No physical harm whatsoever was meant to come to Zubaydah himself and, in any case, the tactic was never used. As evidence of “torture,” this is far from compelling.

One interrogation technique that was used is sleep deprivation. Importantly, however, the memos reveal that the emphasis was always two-fold: to obtain intelligence and cooperation but only insofar as no lasting physical or mental harm came to the detainee. To that end, they stipulate that if the detainee were to be denied sleep then “personnel with medical training” had to be available to intervene “in the unlikely event of an abnormal reaction.” _FPM

As much like genuine torture as The Sound of Music is like hard core porn. And left-wing zomboids are plenty mad about Obama's actions. Oh, not because they feel he has gone too far in placing American forces and the American people at risk. No, leftists are hopping angry because they feel Obama did not go far enough in tearing down America's defenses against death-dealing muslim and other terrorists.

... there is the sense of anxiety and fragility that stems from the liberals' newly-won power. They control everything in government, and some fear what the responsibility of governing is doing to them.

Their president of hope and change has chosen not to prosecute the authors of the Bush-era "torture memos." He is escalating the war in Afghanistan. He seems determined to bail out the nation's richest bankers. For some on the left, it can be difficult to abide those actions and still maintain the image of one's self atop the moral high ground. So they lash out at the easy target... _WashEx

Any easy target will do as long as it is decidedly American, and dedicated to the safety and prosperity of the American people. Leftists are so predictable!

So we see that Obama feels the terrorists' pain, whether they are actually feeling any pain themselves. And we are learning that "torture" -- like "sexual harassment" -- is anything that makes the complainant "uncomfortable" in any way, at any time. There is much to learn from a US President who is so sensitive -- almost effeminately so. The first truly "metrosexual" president surely has more surprises up his laced, perfumed sleeves. We simply cannot wait to learn what they are.

Banned by YouTube, Coming to a Town Near You

H/T Brussels Journal

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From Sweden to Belgium to Holland to Paris to Germany to London. This is the face of your future.

Obama, Saviour of the Universe! Film Festival

Okay, well perhaps the last video is just a bit over the top. It reminds me of something the Obama juggernaut (ACORN, moveon.org, Rev. Wright, etc) might have cooked up, if the Obama steamroller had been running against Obama. Sauce for the goose and the gander, you might say. It certainly had me laughing uncontrollably most of the way through.